Land and Environment Court of New South Wales CITATION : Ku-ring-gai Council v Sydney West Joint Regional Planning Panel [2010] NSWLEC 262 APPLICANT: Ku-ring-gai Council PARTIES : FIRST RESPONDENT: Sydney West Joint Regional Planning Panel SECOND RESPONDENT: Hyecorp Property Fund No. 6 Pty Ltd FILE NUMBER(S) : 40689 of 2010 CORAM: Biscoe J KEY ISSUES: PRACTICE AND PROCEDURE :- leave to withdraw an admission in Points of Defence - principles - leave refused. LEGISLATION CITED: Civil Procedure Act 2005, ss 56-61 Uniform Civil Procedure Rules 2005, r 12.6(2) Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27, 239 CLR 175 CASES CITED: NM Rural Enterprises Pty Ltd v Rimanui Farms Ltd [2010] NSWSC 969 Parramatta City Council v Brickworks Ltd (1972) 128 CLR 1 DATES OF HEARING: 14 December 2010 EX TEMPORE JUDGMENT DATE : 14 December 2010 APPLICANT: Mr T F Robertson SC with Mr J E Lazarus SOLICITORS: HWL Ebsworth FIRST RESPONDENT: LEGAL REPRESENTATIVES: Ms S A Duggan SC with Mr A M Pickles SOLICITORS: Department of Planning SECOND RESPONDENT: Dr J Griffiths SC with Ms M Allars SOLICITORS: Kanjian & Associates JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES BISCOE J 14 December 2010 40689 of 2010 KU-RING-GAI COUNCIL v SYDNEY WEST JOINT REGIONAL PLANNING PANEL & ANOR EX TEMPORE JUDGMENT 1 HIS HONOUR: These are oral applications by the respondents for leave to withdraw an admission in their Points of Defence. The applications are made at the commencement of the hearing of judicial review proceedings fixed for hearing before me for four days commencing today. Notice of the applications appears to have been given to the applicant, Ku-ring-gai Council, only yesterday. 2 A party may not withdraw any admission in a defence or subsequent pleading that operates for the benefit of another party, except with the consent of the other party or leave of the Court: r 12.6(2) Uniform Civil Procedure Rules 2005. In the present case the admission operates for the benefit of the Council which does not consent. 3 The proceedings are a challenge by the Council to the validity of a development consent granted by the first respondent, Sydney West Joint Regional Planning Panel, to the second respondent, Hyecorp Property Fund No 6 Pty Ltd, on 29 April 2010 for the demolition of four existing dwellings and the construction of two residential flat buildings on Boundary Street, Roseville. 4 Three grounds of challenge are pressed: (a) the Panel had no power to grant the consent because the Council, as the responsible authority, had not formed the opinion required by cl 13(2) of the Ku-ring-gai Planning Scheme Ordinance ( KPSO ) namely that the purpose for which the relevant land, being land subject to a road reservation, is reserved could not be carried into effect within a reasonable time after the appointed day (1 October 1971). In the absence of any such opinion having been formed, the development was prohibited because it involved carrying out work of a permanent character on the road reserve. The formation of the requisite opinion by the Council (or alternatively the Panel) is a necessary precondition to the exercise by the Panel of the power to approve the development application; (b) there was no assessment of a State Environmental Planning Policy No 1 ( SEPP 1 ) objection relating to the deep soil landscaping development standard in the KPSO cl 25I(2). The Council, or alternatively the Panel failed to undertake the assessment required by cl 7 of SEPP 1 and failed to consider a mandatory relevant matter, namely, whether the development application should be approved notwithstanding the breach of the relevant development standard; (c) there was a denial of natural justice arising from the late submission of the deep soil landscaping SEPP 1 objection as a result of which objectors were not given an opportunity to make any informed submissions to the Panel in relation to that objection and nor was the Council provided with any reasonable opportunity to assess it. 5 Clause 13 of the KPSO relevantly provides: "13. (1) Except as provided in subclause (2) of this clause a person shall not on land reserved under this Division …carry out…a work of a permanent character…other than a…permanent work…required for or incidental to the purpose for which the land is so reserved. (2) Where it appears to the responsible authority that the purpose for which the land is reserved under this Division cannot be carried into effect within a reasonable time after the appointed day the owner of such land may with the consent of the responsible authority and of the Commissioner for Main Roads…carry out…a work of a permanent character..." 6 In its Further Amended Points of Claim at paragraph 12 the Council pleads: "12. The Development involved the carrying out of a work of a permanent character on the road reserve, within the meaning of cl 13(1) of the KPSO. PARTICULARS The Development included landscaping, drainage, letterboxes and access pathways on the road reserve." 7 In their Points of Defence, each respondent admits this allegation which is important to at least the first of the three grounds of challenge. APPLICABLE LEGAL PRINCIPLES 8 The legal principles applicable to the withdrawal of an admission were reviewed in NM Rural Enterprises Pty Ltd v Rimanui Farms Ltd [2010] NSWSC 969 at [11] – [14] by Harrison J: "11 In Drabsch v Switzerland General Insurance Co Ltd (Supreme Court of New South Wales, Santow J, 16 October 1996, unreported), his Honour summarised the applicable principles at 7 as follows: '1. Where a party under no apparent disability makes a clear and distinct admission which is accepted by its opponent and acted upon, for reasons of policy and the due conduct of the business of the court, an application to withdraw the admission, especially at appeal, should not be freely granted; Coopers Brewery Ltd v Panfida Foods Ltd (1992) 26 NSWLR 738 per Rogers CJ Comm D, followed in IOL Petroleum Ltd v O'Neill per Young J (Young J, 17 November 1995, unreported) and Apex Pallett Hire Pty Ltd v Brambles Holdings Ltd (full Supreme Court of Victoria, 8 April 1988, unreported), and in that respect not following H Clark (Doncaster) Ltd v Wilkinson [1965] Ch 694 at 703. 2. The question is one for the reviewing judge to consider in the context of each particular appeal, with the general guideline being that the person seeking on a review to withdraw a concession made should provide some good reason why the judge should disturb what was previously common ground or conceded; IOL Petroleum Ltd v O'Neill (supra), in the context of withdrawing a concession made before the Registrar. 3. Where a court is satisfied that admissions have been made after consideration and advice such as from the parties' expert and after a full opportunity to consider its case and whether the admissions should be made, admissions so made with deliberateness and formality would ordinarily not be permitted to be withdrawn; Coopers Brewery Ltd v Panfida Foods Ltd (supra) at 745 and 748. Thus a court will not lend its approval to the withdrawal of admissions where, by analogy with the making of amendments, this is actuated by purely tactical reasons; compare Devae Prufcoat Pty Ltd v Altex Industrial Paints Ltd (Cole J, 15 March 1989, unreported). 4. It will usually be appropriate to grant leave to withdraw an admission where it is shown that the admission is contrary to the actual facts. Leave may also be appropriate where circumstances show that the admission was made inadvertently or without due consideration of material matters. Irrespective of whether the admission has or has not been formally made, leave may be refused if the other party has changed its position in reliance upon the admission; H Clark (Doncaster) Ltd v Wilkinson (supra), in that respect not doubted. 5. Following Cohen v Mc William and Anor (1995) 38 NSWLR 476, a court is not obliged to give decisive weight to court efficiency, such that a party who wishes to defend its claim is entitled to a hearing on the merits, with cost orders being available as a means of compensating the other party for any costs thereby unnecessarily incurred or not fairly visited on the other party.' 12 In Maile v Rafiq [2005] NSWCA 410, Tobias JA adopted these principles and said this at [75]: '[75] In my opinion, there is no essential difference between the principles articulated by Master Harper in Wyer on the one hand, which were sourced in the decision of the Full Court in Celestino and that of Santow J in Drabsch , and the statement of principle by the primary judge on the other that the onus lay upon the claimant to place before the Court material not only to explain the circumstances which led to the situation in which the claimant had now found itself but also to satisfy the Court that, were relief to be granted, the opponent would not be prejudiced in obtaining a fair trial on the issue of breach of duty of care." 13 At [58] - [63] and [78] - [91], Tobias JA discussed the issue of prejudice if an admission were withdrawn. A respondent carries no onus to establish actual prejudice and the Court is entitled to take into account presumed prejudice, which arises from delay. His Honour continued at [95]: '[95] In these circumstances, the evidence must establish an adequate reason based on evidence or a sensible explanation of a solid and substantial character explaining the admission of a breach of duty of care in the Notice of Grounds of Defence filed on 11 May 2004…' 14 Kirby J also helpfully referred to the way in which White J had approached some of the pertinent issues in Bank of Western Australia v Salmon [No 1] [2009] NSWSC 224 at [40] – [41] and [43] – [46] as follows: '[40] . . . The authorities are helpfully collected by White J in a case of SLE Worldwide v WGB & Ors [2005] NSWSC 816. It is convenient to quote from the headnote in that case which is in these terms: ' ...Held that admissions made formally and deliberately by party legally advised should prima facie not be permitted to be withdrawn unless party seeking to withdraw them can point to an error when admissions were made or a relevant change of circumstance.' [41] Later in the judgment, White J set out at some length the passages from a number of authorities. They included Sangora Holdings Pty Ltd v Dunstan (Supreme Court of Western Australia, Full Court, 13 April 1999, unreported; BC9901667) where Steytler J (with whom Scott J agreed) said the following: (at 7) '[54] It is a serious matter to make an admission in a pleading. From that point onwards the admitted fact or facts cease to be in issue and the action proceeds upon that assumption. It may often be the case that, absent the admission, the action would have proceeded upon a different basis. It has consequently been said on a number of occasions that, as a matter of principle, a party who has made an admission in a pleading should not be entitled to withdraw that admission without good cause (see, for example, Divcon (Australia) Pty Ltd v Devine Shipping Pty Ltd [1996] 2 VR 79 at 80). The withdrawal of an admission will often even less readily be allowed if it has stood for a long time (see Davey v Harrow Corporation [1958] 1 QB 60 at 69) or when the withdrawal will cause significant prejudice to the other party (see Hamilton v Australian Telecommunications Commission [1989] 2 Qd R 18 at 20 and Permanent Building Society v Wheeler , unreported; FCt SCt of WA; Library No 940115; 22 February 1994 and see, generally, Seaman: Civil Procedure Western Australia para 20.14.2)' … [43] White J observed that this remained a correct statement of the relevant principles after Queensland v JL Holdings Pty Ltd (1997) 189 CLR 146. ( Jeans v Commonwealth Bank of Australia [2003] FCAFC 309; (2003) 204 ALR 327 at 330-331; Silver v Dome Resources NL [2005] NSWSC 265 at [8]-[9]). His Honour continued: '56. ... In Jeans v Commonwealth Bank of Australia , the Full Court of the Federal Court said that there was no principle that admissions might or might not be withdrawn, but that the court had a broad discretion to weigh up all matters, with the overall question being to ensure there was a fair trial. (At 330 [18]). Nonetheless, I approach the task of assessing what fairness to the parties requires, guided by the principles expounded by Santow J in Drabsch . It is legitimate and it may be necessary to consider whether the party making the admission did so deliberately, or whether he did so in error, whether the significance of the admission has changed since it was made, for example by reason of other amendments, ( Silver v Dome Resources NL at [12]), or whether new evidence has come to light. In this case there is no suggestion that the admission was made in error. There has been no change to the pleadings which has altered the significance of the admissions. It is not suggested that new evidence has come to light which justifies their withdrawal. Where a party, who is legally advised and does not suffer any disability, deliberately and without mistake, admits liability in whole or in part, and there are no relevant changes of circumstance, prima facie, justice or fairness to both parties does not require that it be allowed to change its mind. That is why admissions made with deliberateness and formality are not ordinarily permitted to be withdrawn.' [44] His Honour later referred to a Queensland case Rigato Farms Pty Ltd v Ridolfi [2000] QCA 292; [2001] 2 Qd R 455, where De Jersey CJ said this: 'Fulfilling procedural requirements will often contribute significantly to securing an ultimate result which may be considered just. Allowing the appellant to withdraw these deemed admissions would substantially erode the beneficial worth of a very important procedural mechanism directed, through expediting cases and reducing costs, to promoting the interests of justice.' [45] McPherson JA, in the same case, emphasised that, in permitting an admission to be withdrawn, the Court should be satisfied that there was a genuine dispute, and that would ordinarily require an explanation of how the admission came about. White J quoted the following passage from that judgment: 'Before permitting the admission to be withdrawn, the first step to be determined here was whether there was a genuine dispute about the defendant's liability in this action. ... it is not enough for that purpose simply to assert that a dispute exists: ...Some proper basis must be laid for that assertion, which would ordinarily include an explanation of how the earlier admission came to be made and why it should now be permitted to be withdrawn. That is not shown by a (sic) saying simply that there has been a change of solicitors, or that it is possible to see that, before the admission was made, the issue of liability was an open question. Here the defendant has not condescended to swear to the circumstances in which the admission came to be made, or to show that it occurred by inadvertence, mistake or in some other way that might now justify its withdrawal.' [46] I was also taken to the decision of the Federal Court in Re Rocco Celestino v Antonio Celestino [1990] FCA 299 and especially paragraphs 12 to 14; and Coopers Brewery Ltd v Panfida Foods Ltd (1992) 26 NSWLR 738 (Rogers CJ Comm D)." 9 The proposed amendment to the Points of Defence consequential upon the proposed withdrawal of the admissions should also be considered in light of the principles in ss 56-61 of the Civil Procedure Act 2005 and the decision of the High Court in Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27, 239 CLR 175 which was decided in the context of similar rules in the Australian Capital Territory. Section 56(1) provides that the overriding purpose of the Act and of the Rules of Court in their application to civil proceedings is to facilitate the just, quick and cheap resolution of the real issues in the proceedings. Section 56(2) mandates that the Court must seek to give effect to the overriding purpose when it exercises any power given to it by the Act or by rules of Court or when it interprets any provision of the Act or any such rule. In Aon the trial judge granted the plaintiff leave to amend its statement of claim to introduce a new and substantial claim. The High Court allowed an appeal against the decision. 10 The respondents simultaneously with their applications to withdraw their admissions seek leave to amend their Points of Defence by, in the case of the Panel, simply denying paragraph 12 of the Further Amended Points of Claim and, in the case of Hyecorp, pleading that it "denies the Development involved carrying out of any work of a permanent character on the area reserved for the county road widening under cl 13(1) of the KPSO". 11 The proposed amendments appear to constitute denials that the proposed work was a work; a denial that if it was a work, it was a permanent work; and a denial that if it was a permanent work, it was within the reserve. However, the respondents indicated in oral argument that the intent of the proposed amendments was more limited. 12 The Council submits that leave should not be granted because it would be contrary to the applicable principles, including that they are significantly prejudiced in that they would have called expert evidence to establish that the particularised work was work and was of a permanent character and was within the reserve. It is apparent from the evidence that the Council would have called such evidence except that it concluded that there was no need for it as both respondents had admitted paragraph 12 of the Further Amended Points of Claim. 13 The respondents submit that the determination of whether the subject work was work of a permanent character within the reserve should be assessed merely by looking at a couple of plans which were before the Panel when it granted development consent, that the Council's proposed expert evidence on that issue if the withdrawal of the admission were to be allowed would be inadmissible, and in any event no further evidence is required. Consequently, the respondents submit, there is no prejudice to the Council. 14 In my view, it is open to the Council to call expert evidence on this issue as it plainly contemplated that it would do so except for the admissions by the respondents of paragraph 12 of the Further Amended Points of Claim. That pre-hearing material includes an extract from senior counsel's advice in respect of which, to that extent, privilege has been waived. Even the meaning of "work" is a question of fact and degree: Parramatta City Council v Brickworks Ltd (1972) 128 CLR 1 at 24 – 25. 15 The respondents refer to the possibility adverted to by senior counsel for the Council in his pre-hearing advice when addressing the question of expert evidence, that expert witnesses might be council officers. The respondents suggest that evidence from the Council's own officers could be arranged in short order such that the respondents' applications to withdraw their admissions could be allowed, and the expert evidence adduced and heard in the days ahead fixed for this hearing. I accept the Council's objection that it is unreasonable, if not impossible, to put in place a regime whereby it had to endeavour to find expert witnesses in the short time frame of a few remaining days fixed for this hearing. The Panel, at least, acknowledges that if such evidence were forthcoming, it would likely call expert evidence in response or may do so. I also do not think that it is reasonable that the Council should be distracted from its conduct of the proceedings by having to go off and endeavour to find expert evidence whilst the hearing is in progress. 16 The respondents submit that their applications come within principle 4 in the Drabsch case quoted in the passage extracted at [8] above from NM Rural Enterprises viz: "It will usually be appropriate to grant leave to withdraw an admission where it is shown that the admission is contrary to the actual facts". On consideration, I do not think that the respondents' applications come within this principle because the respondents have not shown beyond controversy that the admission is contrary to the actual facts. On the contrary, the material before the Court indicates that the allegation in paragraph 12 of the Further Amended Points of Claim is the fact in the perception of Council's senior counsel but in need of expert evidence to support that conclusion in the absence of the respondents' admission. 17 There is no formal evidence of the process by which the respondents came to a decision that their admission should be withdrawn, especially at such a late stage of the proceedings but they point out that there was some delay in the Council meeting the Court directed timetable for pleadings and service of evidence, and contend that it was only after service of that material that they were really in a position to determine that the admissions should be withdrawn. In particular, attention was drawn to the affidavit of a town planner employed by the Council, Ms Munn, indicating that in an earlier assessment report she indicated that the reserve had an approximate area of 833.5 square metres whereas in that affidavit she now indicates her understanding that it is 760.5 square metres in area. The affidavit of Ms Munn appears to have been served on or about 24 November 2010 and other evidence indicates that long before these proceedings began the second respondent was contending that the area in question was an area corresponding with the understanding which Ms Munn said she had reached in her affidavit. I am not satisfied that there is anything in the Council's conduct of the proceedings which provides a sufficient explanation for the respondents' proposed withdrawal of their admissions, particularly at such a late stage in the proceedings. 18 To allow the withdrawal of the admissions in my view will disrupt and extend the further hearing of the case and will certainly affect its timely disposal. If the respondents call expert evidence in response to the Council's proposed expert evidence, the usual practice of the Court would require a regime for joint conferencing and joint reports and the conclusion of the hearing would likely not occur for some months. The Council submits, and it appears to be the case, that there is such an intertwining of the evidence of a number of witnesses over two or more of the three grounds of challenge that it would be impracticable to continue with hearing part of the case while deferring hearing the balance of the case until after the forthcoming long vacation. 19 The respondents made a clear, distinct and significant admission which was accepted by the Council and acted upon. The onus is on the respondents seeking to withdraw their admission to provide some good reason why the Court should disturb what was previously common ground. I do not think that onus has been adequately discharged nor that there has been adequate explanation of why the application was not made until the first day of the hearing. The Council will be prejudiced if the admissions are withdrawn. 20 For these reasons, the respondents' oral applications to withdraw the admissions of paragraph 12 of the Council's Further Amended Points of Claim are dismissed. 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.