Land and Environment Court New South Wales Medium Neutral Citation: Cumberland Council v Cando Management and Maintenance Pty Limited [2017] NSWLEC 50 Hearing dates: 28 April 2017 Date of orders: 03 May 2017 Decision date: 03 May 2017 Jurisdiction: Class 4 Before: Sheahan J Decision: See [41] Catchwords: PRACTICE AND PROCEDURE: Application to file a cross-summons out of time – change of counsel – interests of justice – costs thrown away – costs of motion – directions. Category: Procedural and other rulings Parties: Cumberland Council (Applicant) Cando Management and Maintenance Pty Limited (Respondent) Representation: Counsel: Ms J McKelvey, barrister (Applicant) Mr P Tomasetti, SC (Respondent) Solicitors: Sparke Helmore Lawyers (Applicant) Sterling Legal (Respondent) File Number(s): 2016/150312 Judgment Introduction 1. This case is presently listed for hearing on 26 – 27 June 2017, but, as a result of a recent change in senior counsel, the applicant seeks leave to file a cross-summons out of time. 2. If that leave is granted, the vacation of the June hearing dates becomes inevitable. 3. The Council helpfully provided the Court with a detailed chronology, to which many relevant documents were attached in a tabbed bundle. 4. The subject development is a completed, but idle, multi-unit residential complex at 527 Woodville Road, Guildford, comprising nine townhouses and basement car parking. It is the subject of a Court-granted consent, dated July 2004. 5. On 2 July 2015, the then Parramatta City Council commenced these Class 4 proceedings, and filed detailed Points of Claim ("POC"). It sought one of two alternative suites of relief, both of which included declarations, restraining orders, and an order that the Respondent demolish the development. 6. The Respondent filed Points of Defence ("POD") on 11 September 2015, and the Council filed several affidavits later in 2015. 7. A central issue in this case is whether or not the July 2004 consent lapsed. 8. In its POC, Council acknowledged (1) the Respondent's efforts during 2015 to rectify its position; and (2) Council's rejection of the Respondent's Building Certificate and Modification Applications. 9. The Respondent has experienced financial pressures (affidavit J J Refalo, 17 February 2017, pars 7 to 10, and some of its annexures). However, its director and his family hold "Donut King" franchises, and come into funds from time to time. 10. In his affidavit of 12 April 2017, Mr Refalo gives a detailed and candid history of the project, his dealings with Council, his exposure to holding costs etc., and his discretion arguments against demolition. The Proceedings 1. The matter has been before the Court on many occasions for directions. 2. The Respondent concedes that it has failed to comply with some directions, and/or to observe Court timetables (affidavit J J Refalo, 1 February 2017, par 4. See also the Respondent's failure to respond to the Applicant's correspondence, demonstrated in tabs 16 to 21). 3. A mediation was conducted by Dixon C, on 8 February 2016, as a result of which the parties reached an agreement (reported to Pain J on 12 February), under which the Respondent undertook: 1. to lodge a development application ("DA") for use of the property as a boarding house; and 2. not to carry out further work, occupy the premises, or permit their occupation, until further order. 1. The written record of the agreement was signed on the Respondent's behalf by Mr Refalo, as its director, and by its then senior counsel, Mr P R Clay, SC. 2. The required DA was lodged on time (31 March 2016), but its assessment was delayed by the State government's realignment of Council boundaries to constitute Cumberland Council. 3. The DA was refused by Council on 6 October 2016 (tab 13), and, on 7 October 2016, the List Judge (Moore J) stood the matter over for three weeks so the Respondent could consider a Class 1 appeal against that refusal. 4. On 28 October 2016, I, as List Judge, noted the Court file "Class 1 not to be pursued", gave a series of pre-hearing directions, and referred the parties to the Registrar to obtain a hearing date. The Registrar set the hearing down for 21 to 23 February 2017. 5. On 3 February 2017, the Respondent failed to appear for a directions hearing, and Moore J vacated that hearing. 6. Then, on 3 March 2017, the current June hearing dates were fixed, and pre-hearing directions were given by Robson J. 7. The Court has been expecting the hearing to be effectively confined to questions of discretion, in light of the Respondent's concessions of unlawfulness (including in its POD). This Application 1. The Respondent's solicitor, Tom Zreika (of Sterling Legal), deposes (affidavit 13 April 2017) that Mr Peter Tomasetti, SC has lately been retained, in place of Mr Clay. 2. On 10 April 2017, Mr Tomasetti gave Mr Refalo advice, which his company has accepted, resulting in the present application by the Respondent for leave to pursue a cross-summons, seeking the following relief: 1. A declaration that development consent JE 1904/03 granted by the Land and Environment Court in proceedings 10175/2004 has not lapsed. 2. A declaration that the existing multi-unit development at 527 Woodville Road Guildford ('the Building') may be occupied without an occupation certificate. 3. A declaration that the cross-respondent is authorised to grant development consent to the strata subdivision of the Building in accordance with the strata plan annexed and marked 'A'. 4. A declaration that the cross-respondent is authorised to issue a subdivision certificate for the registration of the strata plan annexed and marked 'A'. 5. An order that the cross-respondent issue a subdivision certificate for the registration of the strata plan annexed and marked 'A'. 1. Mr Tomasetti said, in argument, that the Respondent was not now pressing the prayer in par 3. The Respondent's Position 1. Since filing its Notice of Motion on 13 April 2017, the Respondent has filed two affidavits from (structural) engineers, and has lodged with Council an application for a building certificate. 2. Mr Tomasetti informed the Court on 28 April that more affidavits (from an architect, a planner, and relevant certifiers) will shortly follow, and that the Respondent will also approach Council about fire safety concerns. 3. Mr Tomasetti also informed the Court that an application may be made to the Court for a modification of the 2004 consent. 4. If the Respondent's present application for leave fails, separate Class 4 proceedings to the same effect will be commenced, and the Respondent will seek orders that all related cases (including any appeal against refusal of the current building certificate application) be heard together. 5. Clearly, the Respondent no longer accepts the boarding house solution, nor is it now content to confine its litigation to questions of discretion. 6. Mr Tomasetti did, however, tell the Court that the Respondent might be content to pursue another mediation, if the Court is happy to order one, once all fresh proceedings and material have been filed. Council's Position 1. Council disputes that the Court has jurisdiction to do all Mr Tomasetti seeks in the draft cross-summons. 2. Counsel for the Council (Ms McKelvey) argues that the Respondent finds itself in "a mess of its own making", and is now asking Council to start its case again. 3. While an order for "all costs thrown away", preferably on an indemnity basis, might arguably cure any prejudice suffered by Council, she submitted that neither the Court nor Council can or should rely on the Respondent's promises. 4. The Respondent should be bound by its earlier decisions, and the case should proceed to the hearing of arguments on discretion. Consideration 1. This late change in the Respondent's position is to be regretted. 2. However, I consider that the interests of justice are best served by granting the Respondent leave to file the cross-summons, even though, given the history of the case, the change of course can hardly be said to be just, quick and cheap. 3. There must be some residual concern that there will continue to be timetable slippage on the Respondent's part as the case proceeds. 4. A tight timetable must be set, and supervised. 5. As a consequence of my decision, the June hearing dates will be vacated. Costs 1. The Council asked for an order that the Respondent, if successful on the present application, pay the Council's costs thrown away, on an indemnity basis. 2. I am content to reserve that question, but the Respondent should, at least, be ordered to pay Council's costs of this motion, on an ordinary basis, as agreed or assessed, before the case, as reconstituted, is set down for hearing or mediation. Orders 1. I, therefore, make the following orders and directions: 1. Leave is granted to the Respondent to file, within 7 days, a Cross-Summons in the form annexed to its Notice of Motion filed 13 April 2017, and marked "A", subject to the proposed deletion of prayer 3. 2. The hearing dates 26 – 27 June 2017 are vacated. 3. The Respondent is ordered to pay, before any further hearing dates, or any mediation date, is/are set by the Court, the Applicant Council's costs on the Notice of Motion, on a party-party basis, as agreed or assessed. 4. The Applicant's oral application for its "costs thrown away" to be paid by the Respondent, on an indemnity basis, is reserved. 5. The Respondent is to serve any amended Points of Defence, any Points of cross-claim, all its affidavits in chief, and its bundle of any additional documents, including any related to questions of discretion, by 1 June 2017. 6. The Applicant is to serve any Points of Cross-Defence, any affidavits in reply, and any bundle of additional documents in reply, by 1 July 2017. 7. The matter is to be listed before the List Judge for further directions on Friday 7 July 2017. 8. The parties have liberty to restore the matter to the List Judge list on 2 days' notice. 9. The chronology and supporting documents are returned to the Applicant. ********** 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. Decision last updated: 03 May 2017