Land and Environment Court of New South Wales CITATION : McGovern and Anor v Ku-ring-gai Council and Anor (No 2) [2008] NSWLEC 50 APPLICANTS David and Roslyn McGovern PARTIES : FIRST RESPONDENT Ku-ring-gai Council SECOND RESPONDENT Marilena Allen FILE NUMBER(S) : 40607 of 2005 CORAM: Pain J KEY ISSUES: Costs :- exercise of discretion to award costs in judicial review proceedings LEGISLATION CITED: Land and Environment Court Act 1979 s 69 Uniform Civil Procedure Rules 2005 Pt 42 CASES CITED: Latoudis v Casey (1990) 170 CLR 534 McGovern v Ku-Ring-Gai Council & Anor [2007] NSWLEC 22 9 November 2007 (written submissions) DATES OF HEARING: 23 November 2007 (written submissions) 3 December 2007 (written submissions) DATE OF JUDGMENT: 11 February 2008 APPLICANT Mr P Roberts SC Mr R Beech-Jones SC SOLICITOR Bradfield and Scott FIRST RESPONDENT LEGAL REPRESENTATIVES: Dr J E Griffiths SC Ms M Allars SOLICITOR Deacons SECOND RESPONDENT Mr P McEwen SC SOLICITOR Harris Freidman Hyde Page JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES Pain J 11 February 2008 40607 of 2005 McGovern and Anor v Ku-Ring-Gai Council and Anor (No 2) JUDGMENT 1 Her Honour: In McGovern v Ku-Ring-Gai Council & Anor [2007] NSWLEC 22 (McGovern (No 1)) I dismissed the Applicants' Class 4 application concerning a challenge to the validity of a development consent issued by the Council to the Second Respondent in 2005. The issue of costs remains outstanding. In this matter each party is seeking its costs as follows. 2 The Council seeks orders that: (a) the Applicants pay the Council's costs of the proceedings, including any reserved costs, as agreed or assessed; (b) the Applicants pay the Council's costs of the motion; and (c) such further or other orders as the Court may deem fit. 3 The Second Respondent seeks orders that: the Applicants pay the Second Respondent's costs of the proceedings, including any reserved costs, as agreed or assessed. 4 The Applicants seek orders that: (a) the Respondents pay the Applicants' costs of the proceedings up to 28 October 2005; (b) thereafter there should be no order as to costs; or (c) alternatively to (b), any order as to costs should be confined to one order for costs only. 5 In the substantive hearing the Applicants relied on the Third Further Amended Points of Claim (TFAPOC) which referred to numerous challenges to the grant of a development application filed in 2004 (the 2004 DA) and a development application filed in 2005 (the 2005 DA). The case as actually argued at the hearing was based on five grounds of challenge and those are the matters considered in my judgment. The grounds were as follows: (i) Non-compliance of 2005 DA with statutory requirements – necessity for a proper survey and certification of Statement of Environmental Effects; (ii) Misrepresentation in relation to matters fundamental to the grant of the 2005 DA; (iii) Breach of natural justice by the Council in granting the 2005 DA; (iv) Failure to take into account relevant considerations by the Council in granting the 2005 DA; (v) Taking account of irrelevant considerations by the Council in granting the 2005 DA. The Applicants were unsuccessful on each of the five grounds. Council's submissions 6 The Council argued that it should have its costs as it was entirely successful in the issues determined by the Court and has not engaged in any disentitling conduct. A history of the proceedings is identified in the written submissions at par 2.3 –2.7 concerning the original challenge the subject of the Class 4 proceedings being to a development application granted in 2004 by the Council on 6 June 2005 (the 2004 DA). The Applicants then applied for a new development application in 2005 which was granted by the Council on 12 October 2005 (the 2005 DA) which then became the subject of the Applicants' Class 4 application. The Court did not determine the validity of the 2004 DA, it being unnecessary to do so given the course of the proceedings. The grant of the 2005 DA had a condition requiring the surrender of the 2004 DA. Despite this the Applicants continued to press grounds of challenge in relation to the validity of the 2004 DA. Only during the hearing was it submitted that it would not be necessary to determine its validity. It was necessary for the other parties to respond to the case presented by the Applicants who continued to challenge the grant of the 2004 DA up to and during part of the substantive hearing. Applicants' submissions 7 The Applicants argued that they commenced proceedings challenging the development consent granted on 6 June 2005 (the 2004 DA) which was later surrendered consequent upon the grant of the development consent on 14 October 2005 (the 2005 DA). As the challenge to the first development was successful due to its surrender the Applicants had succeeded in their claim on that aspect. Reliance was placed on statements in McGovern (No 1) at [138] that the first development consent was bad and a declaration of invalidity inevitable. 8 The challenge to the first development consent was reasonable given the matters referred to in the unchallenged affidavit of Mr McGovern, one of the Applicants, sworn on 2 March 2006 set out in par 8 of the Applicants' written submissions. There were numerous court attendances required to progress the matter in relation to the challenges to the 2004 DA. Accordingly costs should be awarded in the Applicants' favour up to 28 October 2005. 9 There should be no award of costs against the Applicants after October 2005 because it was argued that there were deficiencies in the 2005 DA submitted by the Second Respondent and the Second Respondent had acted falsely in obtaining the consent from the Council. This was said to amount to disentitling conduct by the Council and the Second Respondent such that no award of costs ought be made. 10 Alternatively there should be one order in relation to costs against the Applicants as they ran the same case and the Second Respondent adopted the submissions of the Council. Second Respondent's submissions 11 There should be two costs orders in favour of both of the Respondents. Both were joined in the proceedings, their respective cases were not identical as can be seen from the summary of arguments in the judgment and both Respondents were entirely successful on all the grounds of challenge raised by the TFAPOC provided on the third day of hearing. There is no disentitling conduct and all the reasons advanced to support that submission by the Applicants were rejected at the hearing. Finding 12 At the time the parties' submissions were prepared (they having agreed last year to deal with this matter in writing without oral submissions) s 69 of the Land and Environment Court Act 1979 (the Court Act) was in force. That provided broad discretion to the Court to award costs in Class 4 proceedings. The general approach taken was that costs were awarded on the basis that they should follow the event in the absence of disentitling conduct. While the Uniform Civil Procedure Rules 2005 (UCPR) are now in force in this Court as from 28 January 2008 I consider I should deal with the matter under s 69 of the Court Act. I note that were I considering the UCPR Pt 42 I do not consider my approach would be any different. Costs are compensatory not punitive, see Latoudis v Casey (1990) 170 CLR 534. 13 It is clear from McGovern (No 1) that the focus of the hearing was the validity of the 2005 DA. The Respondents were successful on all the substantive grounds argued and as costs generally follow the event they should have an award of costs in their favour subject to consideration of two further matters. 14 The first issue is whether the Respondents should have their costs for the period up to 28 October 2005 as the 2004 DA was required to be surrendered on the granting of the 2005 DA. The Applicants seek their costs for that period. I made no finding about the validity of the 2004 DA it being unnecessary to do so as it had been surrendered by the Second Respondent. The reliance placed on [138] of McGovern (No 1) is misconceived and mischaracterises the issues which were ultimately before me. I do not consider there is any "event" which suggests the Applicants should have their costs to 28 October 2005. 15 There were grounds of challenge to the 2004 DA as identified at par 9-36 of the TFAPOC which I summarised at [3] of McGovern (No 1). The 2004 DA had little relevance to the issues which were ultimately argued by the Applicants based on the case presented at the hearing. Given that the Applicants continued to press their challenge against the 2004 DA in the TFAPOC there is no basis to limit any award of costs as the Applicants argued, given that costs were incurred by the other parties responding to the issues raised in relation to the 2004 DA. 16 The second issue is that there is no disentitling conduct as alleged by the Applicants. The matters raised as giving rise to such conduct were all considered in the course of the hearing and, as already stated, the Respondents were successful in their arguments on all five grounds of challenge. 17 For the reasons advanced by the Second Respondent both Respondents should be awarded their costs. 18 As the Respondents have generally been successful in their Notices of Motion the Applicants should pay the costs of these motions. Orders 19 The Court makes the following orders: 1. The Applicants are to pay Ku-Ring-Gai Council's costs as agreed or assessed. 2. The Applicants are to pay the Second Respondent's costs as agreed or assessed. 3. The Applicants are to pay the costs of the Council's Notice of Motion dated 29 October 2007 and Second Respondent's Notice of Motion dated 15 October 2007. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.