Land and Environment Court of New South Wales CITATION : Huang v Parramatta City Council [2009] NSWLEC 1227 APPLICANT Uky Huang PARTIES : RESPONDENT Parramatta City Council FILE NUMBER(S) : 10085 of 2009 CORAM: Acting Registrar Gray KEY ISSUES: COSTS :- Amended development application - construction of s 97B Civil Procedure Act 2005 Environmental Planning and Assessment Act 1979 s 97B LEGISLATION CITED: Environmental Planning and Assessment Regulation 2000 Interpretation Act 1987 Land and Environment Court Act 1979 CASES CITED: Cachia v Manly Council (No 2) [2009] NSWLEC 1107 DATES OF HEARING: 20 May 2009 DATE OF JUDGMENT: 21 May 2009 APPLICANT Mr J Doyle LEGAL REPRESENTATIVES: RESPONDENT Mr D Loether, solicitor DLA Phillips Fox JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES ACTING REGISTRAR GRAY THURSDAY 21 MAY 2009 10085/09 - Uky Huang v Parramatta Council JUDGMENT 1 ACTING REGISTRAR: This matter was before me yesterday for directions and at that time Parramatta Council, the respondent in the proceedings, asked for a costs order to be made pursuant to s 97B of the Environmental Planning and Assessment Act 1979. 2 The proceedings concern an appeal against a refusal by the Council for the development for, and use of, premises leased by the applicant as a brothel. An appeal against that same decision was lodged in May 2008 but was ultimately discontinued. When the proceedings first came before me for a directions hearing on 12 March 2009, there was some confusion surrounding the development application that formed the subject of the appeal. This confusion was articulated in a Statement of Facts and Contentions filed by the respondent, which indicated that the material filed with the application to the Court was not the material that was before Council when it made its determination. 3 On that date I made orders that required the applicant to rectify the inconsistencies in the originating process and directing the applicant to file and serve a Notice of Motion to rely on amended plans. In accordance with those directions, that Notice of Motion was filed on 20 March 2009 and was returnable before me on 27 March 2009. On that occasion, by the consent of the Council I granted leave to the applicant to rely on the amended plans. The consequence of that is that the provisions of s97B arise for consideration. That section deals with costs incurred by the Council that are payable if the Court allows the applicant to file an amended development application. The issue of whether a costs order should be made under that section was stood over to yesterday's date from 27 March 2009 to allow the parties an opportunity to reach an agreement as to the terms of any costs order. There having been no agreement, the solicitor for the Council yesterday asked for the costs order to be made pursuant to s97B. 4 There is no dispute as to whether a costs order should be made pursuant to s 97B. It is the precise terms of that costs order that forms the substance of the dispute. The Council submits that the terms of the costs order should reflect the words of s 97B, whereas the applicant submits that the section does not mandate the making of a costs order on those precise terms. 5 Section 97B provides: (1) This section applies to proceedings if the Court, on an appeal by an applicant under section 97 allows the applicant to file an amended development application (other than to make a minor amendment). (2) In any proceedings to which this section applies, the Court must make an order for the payment by the applicant of those costs of the consent authority that were incurred in respect of the assessment of, and proceedings relating to, the original development application the subject of the appeal. (3) The regulations may provide for circumstances in which subsection (2) does not apply. (4) This section has effect despite the provisions of any other Act or law. 6 The provisions of s97B were recently considered by Moore SC in Cachia v Manly Council (No 2) [2009] NSWLEC 1107. At paragraph 3 of that decision the Senior Commissioner says: "The provision contains a number of steps. The first is that there has to be an allowing by the Court of the filing of an amended development application. The second, but not necessarily requiring to be dealt with sequentially with the first, is a consideration of whether the amendments that would be comprehended by such an amended development application constitute "a minor amendment" or not." 7 In the current application, the applicant concedes that the amendments to the plans cannot be described as a minor amendment in accordance with the provisions of this section. Therefore, it is clear that in these proceedings both of those steps have been completed. The Senior Commissioner goes on to say in the following paragraphs: "4. If both of those steps are taken, that is the applicant files an amended development application and the Court determines that the amendments are other than a minor amendment, s 97B(2) requires, in mandatory terms, that the Court must make an order for the payment by the applicant of "those costs of the consent authority that were incurred in respect of the assessment of, and the proceedings relating to, the original development application the subject of the appeal". 5. If such an order is required, that order may be in one of two forms, in my view. 6. First, if the parties reach an agreement as to a sum to be nominated in such an order, I am of the view that the Court is obliged to make an order reflecting that sum and has no obligation to go, nor opportunity to go, behind the terms of the agreed amount and make any inquiry as to its appropriateness or not. 7. If there is not an agreed amount for incorporation in such an order, the Court, in my view, must make the conventional costs order that such costs are to be as agreed or assessed." The Senior Commissioner then went on to consider the meaning of "minor amendment" and determine whether the proposed amendments in those proceedings fell within that meaning. 8 The issues that arise for my determination in these proceedings concern the form of the order that is to be made. The parties did not come to an agreement as to an appropriate sum for such an order. Whilst the Senior Commissioner indicates that in those circumstances the Court must make "the conventional costs order that such costs are to be agreed or assessed", he does not go so far as to say that such an order must be made on the same terms as the precise words of s 97B. His use of the words "mandatory terms" in paragraph 4 simply refers to the terms of the section being such that a costs order is mandatory, and his words there do not extend to a conclusion that the terms of the costs order must follow the terms of the legislation. Further, paragraph 7 does little to shed light on his view as to the appropriate scope and terms of the costs order. Whilst it may have been implicit in his reasoning that any such order should follow the precise terms of the section, that question was not explicitly dealt with by him. 9 A question also arose in relation to whether I am bound by the decision of the Senior Commissioner. Given that I am of the view that the main issue for my determination was not dealt with by the Senior Commissioner, this question need not necessarily be resolved herein. However, given that I will go on to deal with whether an order for costs can be made otherwise than as agreed or assessed, I think it is appropriate for me to consider the question. 10 Both Commissioners and Registrars exercise the functions of the Court pursuant to powers delegated to them from the Chief Judge. For a Registrar, that delegation arises pursuant to section 13 of the Civil Procedure Act 2005. That delegation gives the Registrar a quasi-judicial function. For a Commissioner, that delegation arises pursuant to section 36 of the Land and Environment Court Act 1979. Commissioners are statutory officers appointed under that Act but are not, strictly speaking, judicial officers. There are some powers that are exercisable by Commissioners that are not exercisable by a Registrar. For example, a Commissioner can make a final determination in proceedings falling in Classes 1, 2 and 3 of the Court's jurisdiction. Indeed, that is the primary function of their role. Conversely, there are powers that are exercisable by the Registrar that are not exercisable by a Commissioner. For example, a Registrar has the delegation to make a general order for costs whereas such an order is not within the power of a Commissioner. 11 It seems that a Registrar and a Commissioner are two distinct offices that each exercise the functions of the Court as delegated to them by the Chief Judge. As a result, it cannot be said in my view that one of those officers is bound by the decisions of the other. Nor can it be said that one of those officers can reverse a principle elucidated by the other in a decision made in exercising that delegation. However, in light of the fact that a Commissioner is an appointed statutory officer who has seniority that outweighs that of a Registrar, it is appropriate for the Registrar to look upon the decision of a Commissioner with quite some persuasion. 12 In interpreting the provisions of s 97B, the parties have referred me to the Minister's second reading speech to assist in the interpretation in accordance with s 34(2)(f) of the Interpretation Act 1987. This is consistent with the Senior Commissioner's decision at paragraph 18. On 15 May 2008, the Hon Frank Sartor MP, Minister for Planning, commenced the second reading speech and dealt with the proposed introduction of s 97B by saying: "The bill provides that in a class 1 appeal before the Land and Environment Court, where the court allows an applicant to amend a development application - other than a minor amendment - the court must order that applicant to pay the consent authority's costs thrown away as a consequence of the amendment. This is to act as a disincentive to applicants seeking to amend their proposals before the court without community consultation or input from councils and other relevant authorities." 13 As outlined above, the Council submits that the appropriate order is one that is in the precise terms of s 97B(2). The Council submits that given steps 1 and 2 have been taken in accordance with the decision of the Senior Commissioner, the required result that follows is an order in accordance with the words of s 97B(2) for costs as agreed or assessed. 14 The Council also says that if there is ambiguity as to the meaning of the words of s 97B(2), that ambiguity should be left with the parties or with the assessor. The Council submits that to do otherwise would move away from the intention of the legislation to provide for a mandatory costs order where the Court permits the filing of an amended development application. 15 Mr Doyle, counsel for the applicant, firstly submits that there is no evidence that there have been any costs incurred by the Council in accordance with s 97B(2). He tendered a letter in support of that submission, which is dated 30 March 2009 and requests that the Council indicate to the applicant what costs have been incurred. No response to that letter had been received to date. In those circumstances, Mr Doyle submits that the appropriate order is that there be no costs paid and that such an order is not outside the ambit of s 97B(2). 16 Counsel for the applicant also submits that the section should not be given the wide scope that would arise if a costs order is made on the same terms as that of s 97B(2). That assertion is made on three grounds. Firstly, it is submitted that the intention of the legislature was that the costs in s 97B(2) be the costs thrown away. Secondly, it is submitted that such a scope would be inconsistent with the general discretion of the Court to award costs, which is described as being 'at large'. The better view, it is submitted, is that s 97B(2) identifies a general objective and it is a matter for the Court in its discretion to make a costs order on appropriate terms. 17 Thirdly, Mr Doyle refers me to the provisions of Rule 245AA(2) of the Environmental Planning and Assessment Regulation 2000, which prescribes that the fee paid for the development application covers the completion by the consent authority of certain tasks. The submission is that any costs order pursuant to s 97B(2) should not include costs incurred for the tasks contained in s 245AA(2). 18 The solicitor for the Council submits that it is not appropriate for the Court to have regard to s 245AA(2) and therefore determine what precisely falls within the ambit of an order made pursuant to s 97B(2). The submission by the Council is that such a matter is for the costs assessor. 19 Mr Doyle has also asked that if I do make a costs order on those terms, some comment ought to be provided on how that section should be interpreted in order firstly to assist the parties in agreeing on a sum and secondly to assist a costs assessor if the matter proceeds to an assessment of the costs incurred. Terms of the Costs Order 20 Firstly, I accept that if there is no evidence of costs being incurred by the Council in respect of the original application, the Court can make an order pursuant to section 97B that there are no costs to be paid by the applicant to the Council. In my view this is a course that can be followed by the Court by virtue of the wording of section 97B(2). Where there are no costs incurred by the consent authority, it ought to follow that the order for costs made by the Court reflects the fact that no costs are required to be paid. 21 However in my view it would be unusual and in most circumstances inappropriate for the Court to make such an order. The function of the Court is not to perform an assessment of costs where the parties cannot agree or quantify the specific costs incurred. It would be unusual for the Court to assess the costs as being nought based on a lack of evidence and therefore make an order that there be no costs paid. Notwithstanding that in my view it is open to the Court to take that course in proper circumstances, the more appropriate and usual course is for an order that the costs are as agreed or assessed. This allows a costs assessor to engage in the task of assessing the extent of the costs incurred. 22 Further, in most cases, as in these proceedings, the incurring of costs by the consent authority will be evident from the court file. In these proceedings, prior to the filing of the Notice of Motion by the applicant seeking to rely on amended plans, a Statement of Facts and Contentions was filed by the Council and there was an appearance by the Council in the directions hearing list before me. It is clear that costs were incurred by the Council in dealing with the original application and it is therefore not appropriate for me to make an order that there are no costs to be paid by the applicant to the Council. 23 I accept the submission by the Council that section 97B requires an order for costs on the precise terms of that section. In my view the terms of the section make it clear that the terms and scope of the costs order should be identical to the terms of s 97B(2). I think the section should be read according to is plain meaning and I cannot accept the submission by the applicant that the section should be interpreted narrowly in light of the general discretion to award costs. Construction of Section 97B(2) 24 I refer to the invitation made by Mr Doyle to make some comment as to the precise interpretation of the costs that are intended to be covered by such an order. 25 In my view that is not the role of the Court in making the costs order. The interpretation of the words of the costs order is a matter for the parties and for the assessor if there is no agreement between the parties. 26 I therefore make some preliminary comments that are not intended to be binding on the costs assessor. It appears to me that the words of s 97B(2) suggest that costs can be recovered for two distinct aspects of the application. The first is the costs incurred in respect of the assessment of the original development application. The second is the costs incurred in the proceedings relating to the original development application. 27 The first appears to relate to the costs incurred by the consent authority in engaging in the assessment of the actual development application. It appears that those costs must exclude the duties that are outlined in Rule 245AA(2). To include those duties in the costs the subject of an order pursuant to s 97B(2) would be to allow the consent authority to obtain its costs for those tasks twice. In my view, such a result would be contrary to the purpose of the section as set out in the second reading speech. 28 The second aspect of the costs entitled to be covered pursuant to the terms of s97B(2) appears to be for legal or professional costs incurred in the proceedings (including party/party costs) up to the time of leave being granted to rely on the amended plans. 29 However, the precise scope of the section is ultimately a question for a costs assessor. It is not the role of the Court, at the point of making the order pursuant to s 97B(2), to define the ambit of the costs intended to be recovered by that section. Costs of this application 30 Mr Doyle, counsel for the applicant, raised the issue as to whether costs should be awarded in favour of either of the parties following the outcome of my decision. The matter was before me yesterday for directions, which are part of the usual course of the proceedings. Whilst there were a number of extra hours of attendance required for the argument on the question of s 97B, an order for costs is not made in proceedings of this nature unless the Court is satisfied that it is fair and reasonable to do so. In my view, each of the parties in this application was entitled to articulate their view and neither party was unreasonable in doing so. Accordingly, the appropriate order is that there be no order as to the costs of this application. 31 Therefore I make the following orders: 1. That the Applicant pay the respondent's costs incurred in respect of the assessment of, and proceedings relating to, the original development application the subject of the appeal, as agreed or assessed. 2. That there be no order as to the costs of this application. 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.