Land and Environment Court New South Wales Medium Neutral Citation: Moss Vale Projects Pty Limited v Wingecarribee Shire Council [2018] NSWLEC 180 Hearing dates: 25 September 2018 Date of orders: 12 November 2018 Decision date: 12 November 2018 Jurisdiction: Class 1 Before: Sheahan J Decision: (1) The Notice of Motion brought by Council on 16 August 2018 is dismissed. (2) Each party is to pay its own costs on that Notice of Motion. (3) The Exhibits may remain in the Court file. Catchwords: COSTS: Discontinued Class 1 appeal – application by Respondent Council for all of its costs of the appeal – principles to apply – costs on the motion. Legislation Cited: Environmental Planning and Assessment Act 1979 Land and Environment Court Rules 1996 Land and Environment Court Rules 2007 State Environmental Planning Policy (Infrastructure) 2007 Uniform Civil Procedure Rules 2005 Wingecarribee Local Environment Plan 2010 Cases Cited: Aldi Foods Pty Ltd v Holroyd City Council (2005) 142 LGERA 141 Arden Anglican School v Hornsby Shire Council (2008) 158 LGERA 224; [2008] NSWLEC 103 Community Association DP270253 v Woollahra Municipal Council (2015) 207 LGERA 268; [2015] NSWCA 80 Dunford v Gosford City Council (No 3) [2015] NSWLEC 96 Futurespace Pty Ltd v Ku-ring-gai Council (2009) 169 LGERA 45; [2009] NSWLEC 153 Hunter v Central Coast Council [2017] NSWLEC 154 Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 53 Marinkovic v Rockdale City Council (2007) 151 LGERA 385; [2007] NSWLEC 71 McDonald's Australia Limited v Ashfield Council (No 2) [2012] NSWLEC 268 Port Stephens Council v Sansom (2007) 156 LGERA 125; [2007] NSWCA 299 Re The Minister for Immigration and Ethnic Affairs of the Commonwealth of Australia; Ex Parte Lai Qin (1997) 186 CLR 622 Ross v Lane Cove Council [2013] NSWLEC 109 Universal Childcare Pty Ltd v Leichhardt Municipal Council [2008] NSWLEC 277 Valoth v Parramatta City Council (No 2) [2012] NSWLEC 161 Category: Costs Parties: Moss Vale Projects Pty Limited (Applicant) Wingecarribee Shire Council (Respondent) Representation: Counsel: Mr S Nash, barrister (Applicant, and respondent on the costs motion) Mr C Leggat, SC (Respondent, and applicant on the costs motion) Solicitors: Project Lawyers Pty Ltd (Applicant) Shaw Reynolds Lawyers Pty Ltd (Respondent) File Number(s): 2017/143343 Judgment Introduction 1. The Respondent Council in this discontinued Class 1 appeal seeks an order that all its costs of the proceedings be paid by the Applicant Company. 2. The substantive proceedings were commenced by an Application filed on 12 May 2017, appealing against the Council's refusal (subject of a Notice of Determination, dated 21 November 2016) of a development application ("DA" – no 16/0361), lodged with Council on 29 April 2016. 3. The subject DA sought approval for a supermarket and associated car-parking, on a site fronting Argyle Street, Moss Vale, but "located next to a waterway [("Whites Creek")], and at the confluence of five roads" (Tp2, LL44-45), including Lackey Road. 4. The Appellant Company also lodged extensive supporting documents with its Class 1 application, and a s 34 conference to seek a resolution of the appeal was terminated on 9 October 2017. 5. The appeal was twice listed for hearing. 6. The original hearing dates, 5 to 8 March 2018, were set on 18 October 2017, but were vacated on 8 February 2018, with "costs thrown away" ordered in favour of Council. 7. The hearing was rescheduled, on 16 February 2018, for 31 July to 3 August 2018. 8. On 27 July 2018, the Assistant Registrar granted the Applicant leave to discontinue, but noted that the Respondent Council reserved it rights to "put on a motion for costs" (transcript before me as Exhibit C1). 9. The notice of discontinuance, signed by only the Applicant's solicitor, was filed later that day. 10. The Notice of Motion ("NOM") for costs was filed on 16 August 2018. 11. It was argued before me on 25 September 2018, when Mr C J Leggat SC appeared for the Respondent Council, as applicant on the motion, and Mr S Nash of counsel appeared for the Applicant Company, as respondent to the motion. 12. I find no merit in the Applicant's contention that the Court lacks jurisdiction to deal with a costs application in these circumstances (see Tp44, L35-p45, L5). 13. Discontinuation is a common "outcome of litigation"; it occurs in a wide range of circumstances, and cannot put an end to either party's right to seek a compensatory costs order. In this respect I accept the Council's submissions (Tp46, LL7-43). Relevant Provisions 1. The Court's Practice Note covering Class 1 Development Appeals, published on 29 March 2018, includes the following provisions which Council finds relevant here (emphasis added): Parties to seek directions before adducing expert evidence ... 25. A party intending to adduce expert evidence at the hearing of any development appeal must apply for directions from the Court under Pt 31 r 31.19 of the Uniform Civil Procedure Rules 2005 permitting the adducing of expert evidence. 26. The application for directions is to be made at a directions hearing at which the development appeal is listed for hearing. The application is to be supported by a completed information sheet ..., outlining the issues in the proceedings, the experts whose opinion is sought to be adduced as evidence in the proceedings, and the areas of expertise of each expert. ... ... 28. A party may not adduce expert evidence at the hearing of any development appeal unless the Court has given directions permitting the adducing of that expert evidence and the adducing of that expert evidence is in accordance with those directions ... 29. Any directions for the filing of experts' reports and joint expert reports made by the Court will specify the name of each expert required to comply with the directions. 30. If either party seeks to adduce the evidence of any expert not named in the directions made, that party is required to seek additional directions for the filing of evidence by that expert ... Any application for additional directions is to ... provide the information and explanation referred to in paragraphs 26 and 27 of this practice note. ... Applications to vacate hearings and for adjournments 95. Development appeals will not be adjourned generally. In particular, applicants for consent should generally be ready to proceed with their development appeal when it is commenced. This requires applicants to ensure that their development appeal application, and the development proposed in the application, is considered, complete and final, and suitable for assessment at the final hearing. 96. Development appeals usually will not be adjourned because of failure to comply with this practice note or Court directions or because of lack of preparedness for any attendance before the Court. If failure to comply or lack of preparedness nevertheless does cause the adjournment of the proceedings, the defaulting parties or legal practitioners may be ordered to pay costs. ... Costs and compliance 103. If a breach of the Court's directions or of this practice note causes costs to be thrown away, a party or legal practitioner responsible for the breach may be ordered to pay those costs. 104. The cost of unnecessary photocopying and assembly of documents is unacceptable. Legal practitioners for the parties are to consider carefully the documents necessary to be tendered. Unnecessary documents may attract adverse costs orders. 105. Any failure by one party to comply with the Court's directions will not be considered an adequate excuse for any failure to comply by the other party. Applications for a cost order 106. ... Note: Pt 3 r 3.7 of the Land and Environment Court Rules 2007 provides that for proceedings in Class 1 of the Court's jurisdiction, including development appeals, the Court "is not to make an order of the payment of costs unless the Court considers that the making of an order as to the whole or any part of the costs is fair and reasonable in the circumstances": Pt 3 r 3.7(2). Some of the circumstances in which the Court might consider the making of a costs order to be fair and reasonable are listed in Pt 3 r 3.7(3). 107. The notice of motion for costs [envisaged by par 106] will be heard and determined by either the Registrar or a Judge of the Court. 1. It is to be remembered that costs are compensatory, not punitive: Latoudis v Casey [1990] HCA 59; (1990) 170 CLR 534. 2. Rule 3.7 of this Court's Rules, dated 2007, relevantly provides (emphasis added): Costs in certain proceedings (cf Land and Environment Court Rules 1996, Part 16, rule 4) (1) This rule applies to the following proceedings (except for appeals under section 56A of the Act): (a) all proceedings in Class 1 of the Court's jurisdiction, ... (2) The Court is not to make an order for the payment of costs unless the Court considers that the making of an order as to the whole or any part of the costs is fair and reasonable in the circumstances. (3) Circumstances in which the Court might consider the making of a costs order to be fair and reasonable include (without limitation) the following: ... (b) that a party has failed to provide, or has unreasonably delayed in providing, information or documents: (i) that are required by law to be provided in relation to any application the subject of the proceedings, or (ii) that are necessary to enable a consent authority to gain a proper understanding of, and give proper consideration to, the application, ... (d) that a party has acted unreasonably in the conduct of the proceedings, ... 1. Section 97B of the Environmental Planning and Assessment Act 1979 ("EPA Act"), prior to the major revision of the Act, effective 1 March 2018, provided (emphasis added): Costs payable if amended development application filed (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 are thrown away as a result of amending the development application. (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. 1. A major question, which often arose when s 97B costs were sought, was whether the amendment was "minor" or not, and some principles to guide that decision were articulated by Pepper J in Futurespace Pty Ltd v Ku-ring-gai Council ("Futurespace") (2009) 169 LGERA 45; [2009] NSWLEC 153, at [42]. 2. The relevant new provision in the EPA Act is s 8.15(3), which provides: If the Court on an appeal by an applicant under this Division allows the applicant to file an amended application for development consent (other than to make a minor amendment), the Court must make an order for the payment by the applicant of those costs of the consent authority that have been thrown away as a result of the amendment of the application for development consent. ... 1. State Environmental Planning Policy (Infrastructure) 2007 ("the Infrastructure SEPP") applied to the proposal in this case, because the subject site is located "in or adjacent to road corridors" (Tp3, L13), requiring the consent authority to be satisfied about access, as a critical issue in terms of traffic. 2. The requirements of the Wingecarribee Local Environment Plan 2010 ("LEP") made the site's "high hazard" flood risk, and questions of drainage, important merit considerations. Some Relevant Authorities 1. In Class 1 of this Court's jurisdiction there is no presumption that a discontinuing Applicant should pay the Respondent's costs: Ross v Lane Cove Council ("Ross") [2013] NSWLEC 109, at [1] to [11]. 2. However, Rule 3.7(2), quoted above ([16]), contains a "presumptive rule" that there be no order, unless it be "fair and reasonable in the circumstances". 3. The Judge determining a costs application in Class 1 normally examines the history of both the project and the proceedings, as fairness and reasonableness must be adjudged on the individual facts and circumstances of the particular case at hand. 4. The Judge must not, however, be drawn into some form of hypothetical trial of the substantive case, in order to decide the question of costs: Re The Minister for Immigration and Ethnic Affairs of the Commonwealth of Australia; Ex Parte Lai Qin (1997) 186 CLR 622, e.g. at 626. 5. In Marinkovic v Rockdale City Council ("Marinkovic") (2007) 151 LGERA 385; [2007] NSWLEC 71, Preston ChJ noted (at [21]) that Class 1 matters often involve "the generation of amended plans as a consequence of an evolutionary process", and then said (at [22]-[23]): 22 There should be a capacity for an applicant in class 1 proceedings before the Court to amend its application to respond to evidence, including evidence of a court appointed expert, and to address concerns of the court that is hearing the appeal. A respondent council should expect that an applicant might need to respond in this way. That is to say, such amendments should be seen to be part of the usual process of conducting a class 1 appeal in this Court. The mere making of an amendment is not by itself a circumstance that always makes it fair and reasonable to make an order for costs. 23 Of course, there must be some limit placed upon this capacity to respond to evidence and to the Court's concerns by means of an amendment. This case is a good illustration. The multiple amendments that were made by the applicant prior to 19 September 2006 is an illustration of where an applicant has stepped outside what can be reasonably expected in the usual conduct of a class 1 appeal. 1. His Honour did not accept ([26]) that there is "an inviolate rule that an order for costs should always be made whenever there is an application to amend", but said that: there must be some capacity for an applicant to respond to the evidence and the concerns of the Court. This should be seen as part of the usual conduct of proceedings. Where making that amendment does lead to costs thrown away, then there may be some justification for making an order ... 1. In Universal Childcare Pty Ltd v Leichhardt Municipal Council ("Universal") [2008] NSWLEC 277, I surveyed key authorities, including (at [13]) Aldi Foods Pty Ltd v Holroyd City Council (2005) 142 LGERA 141, in which Talbot J said (at [5]): The Rules make it plain that the approach to an application for an order for costs in class 1 proceedings is fundamentally unchanged from the historical position to the extent that the underlying principle is that there will generally be no order as to costs. Accordingly, unless it is in the circumstances of the particular case otherwise fair and reasonable, the Court will approach the exercise of its discretion on the basis that parties are to remain confident they may commence or defend proceedings without the onerous threat of incurring liability for costs other than their own, even if they are not the successful party. In other words costs will not be awarded in the proceedings referred to in Part 16, rule 4 unless it is fair and reasonable to depart from the underlying assumption in the circumstances of the particular case. Reasonableness is to be determined according to the ordinary sense of the word. The award of costs has to be fair as well as reasonable. Thus not only must it be reasonable for costs to be awarded but it must also be just and equitable. 1. I noted in Universal (at [6]), what has become known as the "non-discouragement" principle, "underpinning the basic rule or presumption that there be 'no order'", and then added: That principle requires the court to be careful not to act in such a way in relation to costs that it will discourage applicants entitled to appeal from doing so because of the risk or threat that failure would more likely result in an order for costs against them. 1. I also noted (at [14], and later at [54]): 14 It is only when the facts are clear that the principles can be applied. In the present case there is an extraordinary volume of documentary evidence before the court, and competing sworn evidence from the solicitors for the parties on the significance of those documents and particular events ... ... 54 In adversarial proceedings the principle that "costs follow the event" has a big influence on the parties, not least on settlement of the dispute. On the other hand, the "non-discouragement" principle (see par [6]) underpins the "fair and reasonable" test this court applies in planning appeals. 1. In my conclusion, I said (at [71]): While the present case may not be seen to be as serious a breach of "the usual conduct of a class 1 appeal" process as Marinkovic, I am satisfied that it is fair and reasonable for the Council to recover costs which would otherwise not be incurred in an appeal of this type. While I could set a particular date, or adopt some other formula as the various authorities I have surveyed suggest, I am satisfied that the principal order suggested by Mr Ayling is appropriate, in the sense of being fair, just, reasonable and equitable (as required by the authorities), in all the circumstances. 1. During argument in Universal, there was discussion about the concept of what the Council lawyer called the "usual 'argy bargy' that goes on between an applicant and Council" in development assessment, and in Class 1 appeals, as they work, hopefully collaboratively, towards "an appropriate environmental outcome". 2. In Arden Anglican School v Hornsby Shire Council (2008) 158 LGERA 224; [2008] NSWLEC 103, Biscoe J said (at [9]): In the context of the presumptive rule that there will be no order as to costs in planning appeals, the power to make a costs order is in the broadest of terms, that is, what is "fair and reasonable in the circumstances". All rational considerations are relevant to the formulation of that judgment. In the end, the question is whether, in the opinion of the Court, they are of sufficient weight to overcome the presumptive rule. ... 1. Biscoe J revisited the presumptive rule in Ross saying (at [10] – [11]): 10 For example, if there was no reasonable basis for a planning appeal, that would be a strong circumstance supporting a costs order against the discontinuing applicant. But if, for example, an applicant, in the light of evidence that has emerged during the proceedings or an "amber light" by the presiding Commissioner, decides that the resultant increased risks of litigation are such that a planning appeal should be discontinued, with resultant savings in time and costs of the other party and saving of the Court's time, that may be a circumstance weighing against ordering the discontinuing party to pay the costs of the other party. In such a situation in a planning appeal, it may be sensible to discontinue, and not sensible to discourage the applicant from discontinuing by raising a presumption that it should pay the respondent's costs and to encourage it to continue and lose by a r 3.7(2) presumption that there will be no costs order. 11 I would make an additional observation about r 3.7(3)(c) of the LECR, which provides that a circumstance in which the Court might consider the making of a costs order to be fair and reasonable is that a party has acted unreasonably in circumstances leading up to the commencement of the proceedings. ... 1. In Valoth v Parramatta City Council (No 2) [2012] NSWLEC 161, I applied the principles I had summarized in Universal, and dismissed an application for costs. I found "no unreasonable, irrational or improper conduct" on Council's part, and I also awarded to Council its costs on the costs NOM, as I was not satisfied it was reasonable for the Applicants to have sought a costs order (see [118]-[121]). 2. In McDonald's Australia Limited v Ashfield Council (No 2) [2012] NSWLEC 268, I dismissed the Council's application for costs on the basis of the above principles. 3. In Dunford v Gosford City Council (No 3) ("Dunford") [2015] NSWLEC 96, I dealt with a series of Court of Appeal decisions on orders for costs in Class 1. 4. That Court noted, in Port Stephens Council v Sansom (2007) 156 LGERA 125; [2007] NSWCA 299, at [51], that the formulation "fair and reasonable" requires the Court to make a judgment rather than exercise its wide discretion (Dunford, at [30]d.), and that the circumstances identified in Rule 3.7(3) are neither prescriptive nor exhaustive ([30]f). Each case clearly turns on its own facts and circumstances. 5. In Community Association DP270253 v Woollahra Municipal Council (2015) 207 LGERA 268; [2015] NSWCA 80, Barrett JA, delivering the judgment of the Court of Appeal, distinguished (at [53]) between the unreasonableness of conduct, related to the particular proceedings, with which Rule 3.7 is concerned, and "unreasonableness" affecting the decision challenged in the proceedings. His Honour said (at [55]): The Association chose to bring Class 1 proceedings and thereby to enter an arena to which rule 3.7 applied. That being so, it could not (and did not seek to) argue simply that costs should follow the event. It was required to establish that some aspect of the conduct of the Council as a litigant in the Class 1 proceedings made it fair and reasonable that the judge should cause the prima facie position prescribed by rule 3.7(2) to be replaced by a situation in which the Council was required to pay the Association's costs. The Association has, in my opinion, failed to establish this. ... 1. In November 2017, Pain J dismissed a costs claim in Hunter v Central Coast Council [2017] NSWLEC 154, which concerned the Avoca Beach Theatre. Her Honour noted (at [38]) that: ... despite the presumptive rule in r 3.7 of the Court Act, a comparison of the interests of the parties in planning appeals suggests that an unsuccessful consent authority should be more likely to suffer an adverse costs order than an unsuccessful applicant ... The Evidence 1. In the present matter, the Council applicant for costs relied upon, apart from the transcript in Exhibit C1, and the Court's practice notes, two affidavits by one of its solicitors, Robecca Cunningham (16 August and 4 September 2018), and other sworn material included in them. 2. The Applicant respondent on the costs motion relied upon affidavits from the following: 1. Its solicitor, Anthony Perkins, 30 August 2018; 2. Its traffic expert, Tim Rogers, 3 September 2018; and 3. Its junior solicitor, Claire Parsons, 20 September 2018; and two annexures to a further affidavit, sworn by Cunningham on 27 July 2018, but not read by Council, namely: 1. an email from Council's planning expert, Deb Laidlaw, to Cunningham and others, dated 18 July 2018 (annexure 'E' to the affidavit, and Exhibit A1 before me); and 2. an email from Cunningham to Council's water and traffic experts, Andrew Norris and Daniel Martens, dated 6 February 2018 (annexure 'B' to the affidavit, and Exhibit A2 before me). A Factual Chronology of the Case 1. As is usually found necessary in these cases, I will now examine, in regrettable detail, the history of the proceedings, and any relevant extra-curial behaviour of the parties, in the chronological order disclosed by the evidence, and/or the Court record, and/or the competing submissions of the parties. 2. On 18 October 2017, when the Class 1 appeal was set down for hearing in March 2018, directions were given for preparation of the case for trial, and competing experts were identified for traffic and hydraulic issues, which, along with planning issues, appeared to be the major issues between the parties. 3. On 19 December 2017, the Applicant's traffic expert, Rogers, met with RMS over the latter's concerns regarding access and other traffic issues. 4. On 6 February 2018, the Applicant, preferring not to proceed "absent RMS support on concurrence" (Tp28, LL11-12), sought vacation of the March hearing dates. As Perkins deposes, the Applicant wished to amend its DA, to address matters raised in Council's SFC, in the conciliation conference, and in discussions with RMS. Council did not oppose the vacation, but directed its experts to cease joint conferencing (Exhibit A2). 5. On 8 February 2018, the March hearing dates were vacated, and the Applicant was ordered to pay Council's costs "thrown away" as a consequence. 6. On 15 February 2018, the second set of hearing dates (commencing 31 July 2018) were fixed, and the Applicant was directed to file and serve any application it wished to make for leave to rely on amended plans. 7. On 4 May 2018, the Applicant was granted leave to amend its application, but ordered to pay s 97B costs consequential upon its amendment ([17] above). 8. On 9 May 2018, the Applicant served "soft" copies of its "amendment documents", including plans. Those documents included some material regarding flood issues, prepared by Cardno for the Applicant's nominated water expert (Cardno later became or provided an "additional" expert, for the Applicant, engaged to assist in its responding to Council's allegedly changing position). The Applicant notes (Tp30, LL32-40) that Council, as at May 2018, raised no issue about the Applicant's reliance on its flooding material, including that from Cardno (which was not yet engaged as an expert in the proceedings). 9. On 16 May 2018, leave was granted to the Applicant to rely upon its amended DA, and Council was ordered to file and serve an amended statement of facts and contentions ("ASFC") by 8 June 2018. Experts' joint reports were required by 6 July 2018. 10. As at 8 June 2018, no ASFC had been filed and/or served. 11. On 18 June 2018, Rogers provided to RMS, and Council, his revised traffic report and amended plans, upon which RMS requested further information, which Rogers provided to RMS, with a copy to Council. 12. On 20 June 2018, Martens suggested amendments to Council's proposed ASFC, regarding both traffic and flooding. On 21 June 2018, the Applicant chased Council for that ASFC, which had been due, as noted above, on 8 June 2018. 13. On 3 July 2018, Council served an unfiled ASFC, but it provided no explanation for its delay from 20 June (Tp32, LL14-20). The Applicant says, (Tp32, LL29-32) that this "became the turning point ... where the wheels ... fell off", and (Tp30, LL38-50) that those contentions made necessary the engagement of Cardno as an expert witness (see also Tp33, LL5-50), Council having "raised numerous new [unanticipated] issues" (Tp32, LL34-36). The Applicant also says (Tp34, LL8-19) that these events made clear that Council did not see flood management as a topic which could be dealt with by conditions. 14. On 5 July 2018, Council notified the Applicant that it had engaged new hydraulic and heritage experts, and the orders made on 16 May 2018 were revised, by consent, to accommodate those changes. Also on 5 July, Council advised the Court that the lateness of its ASFC was due to Martens's "recent unavailability". 15. On 6 July 2018, the Applicant's flooding expert, Andrew Francis, advised that Martens would not be available to meet him until 13 July (only two weeks before the hearing). 16. On 9 July 2018, Council was provided with a (further?) copy of the Preliminary Site Investigation Report, from WSP Parson Brinkerhoff, relevant to Council's contamination contentions. 17. On 10 July 2018, the orders made on 18 October 2017 were revised, to remedy the omission of the joint traffic expert report. 18. On 13 July 2018, the Applicant's traffic expert provided to the RMS, revised plans, and the further information it had requested, and again sent copies to Council. 19. Also on 13 July 2018, the Applicant sought the participation, in joint conferencing and reporting on flood issues, of Cardno's Mr Hentschel, who had, to Council's knowledge (since 9 May 2018), prepared the Applicant's flood modelling, on which Francis was said to be "sweating" (Tp36, LL5 and 19). 20. On 16 July 2018, the respective traffic experts commenced joint conferencing, and Council's expert indicated that the RMS's concurrence to the DA was expected. 21. Also on 16 July 2018, the joint heritage report was received. 22. On 17 July 2018, Council refused to agree about Cardno ([61] above), but the Applicant contends that its request was reasonable – and Council's refusal unreasonable – because of Council's "new (and late)" contentions. Council says that the Applicant is bound by its forensic decision, on or shortly after 9 May 2018, not to apply to the Court at that time for the Cardno expert to provide its own expert evidence (Tp49, LL36-47). 23. Also on 17 July 2018, RMS wrote to Council withdrawing its objection to the DA, subject to the imposition of recommended conditions (Exhibit A1). A copy was provided to the Applicant's traffic expert. 24. On 19 July 2018, the Applicant asked Council to confirm its position on traffic issues, in the light of RMS's advice. 25. Also on 19 July 2018, Council filed and served its tender bundle. 26. On 20 July 2018, the joint expert town planning report was received. The Applicant complains that the Council expert, Laidlaw, refused to discuss the additional information she acknowledged the Applicant had provided, responsive to Council's contentions. 27. Also on 20 July 2018, allegedly with no notice to the Applicant, and only ten days before the hearing, Council served a NOM for leave to further amend its SFC, to add what are said to be "entirely new" contentions regarding prohibitions, owner's consent, excavation, and inadequate plans. Also, the Applicant sought confirmation from Council that the Applicant had satisfied (by the Site report) Council's contention (3.6) regarding contamination. 28. Council failed to respond, leading the Applicant to complain (1) that it was denied an opportunity to prepare a further response on the issue, and (2) that the Council's written submissions indicated that contention 3.6 was to be pressed. 29. On 24 July 2018, Council sought to add to its tender bundle, further documents relating to its contentions on the question of tree removal(s). The Applicant complains that none of the experts had dealt with those documents in their evidence. 30. On 25 July 2018, RMS reversed its concurrence, apparently in response to representations by the Council that RMS would have to attend the hearing to justify its (change in) position (Tp36, LL23-27). (Council was aware that the Applicant, which had worked closely with RMS on key issues (Tp40, LL35-36 and see Rogers's affidavit), had provided revised material after 18 June, in advance of the 17 July concurrence decision.) No explanation was given. 31. Also on 25 July 2018, the Applicant filed its NOM to vacate the July-August Hearing Dates. Council "actively opposed" this second vacation application (Tp50, LL15-16), refused to consent to short service, and also, without reason or indication (Tp41, L5), withdrew its NOM to further amend its SFC, upon which the Applicant had concentrated its efforts for "five critical days" pre-hearing (Tp41, LL16-17). The Applicant complains (Tp40, L46) that Council took "an unreasonable position", so that (Tp41, LL13-14) "it could avoid blame for any need for the hearing to be vacated or discontinued". 32. On 26 July 2018, Martens informed Council's solicitors of the (alleged) reasons for delay in finalising flooding and traffic joint reports. 33. On 27 July 2018, Assistant Registrar Anastasi dealt with the Applicant's motion to vacate, and granted leave to the Applicant to discontinue (Exhibit C1, and see [8] above). Competing Submissions Council 1. Council's primary submission is that the chronology of events, as described above, brings Rule 3.7(3) into play, because of the Applicant's "delay in providing responsive information and material, both in relation to flooding and ... traffic ..." (Tp8, LL11-13, see also p18, LL25-30). 2. While "council was moving matters along as fast as it could" (Tp10, LL30-31), the Applicant caused delays by its flood expert Francis's reliance on having its modelling done by a subcontractor, Cardno, (Tp8, LL27-29), with further delay in the Applicant's provision of traffic materials to Council's Dr Martens, explained as "inadvertence" (c.f. "oversight, or omission" – Tp9, c.f. p31, LL41-42). 3. Council rejects the Applicant's claims that Council kept raising "new issues that took us by surprise", leaving it with "no choice but to vacate the hearing" (Tp10, LL44-47). Council claims that it was the Applicant which kept amending its proposal (Tpp11-12), while Council took the view that "the site is probably so flood affected that it's not suitable for a supermarket" (Tp13, LL21-22), and, specifically, the Applicant failed to secure the concurrence of RMS to its proposals regarding traffic and access (Tp15). 4. Council submits (subs par 28) that the events described in the chronology above: ... demonstrate that it is fair and reasonable in the circumstances for there to be an order for costs made in favour of the Council. The principal reason is that the Applicant has acted unreasonably in its history of extensive delay in providing responsive information and material and its conduct is outside what can be reasonably expected in the usual conduct of a Class 1 appeal, and it is this conduct to which Rule 3.7(3) is directed. Applicant 1. The primary grounds, apart from the jurisdictional issue ([12]-[13] above), upon which the Applicant opposes Council's costs motion are (subs par 2, amplified in par 45): (b) The Applicant has acted reasonably in the conduct of these proceedings. If there is fault to be found, it is that the Applicant was too accommodating in respect of the actions of Council. To the extent there were failures to adhere strictly to the Practice Note, those failures were not material and were not unreasonable in light of the proximity of the hearing. (c) To the extent that there were delays on the part of the Applicant, these were as a result of the actions of the Council. To award costs in favour of the Council would enable the Council to derive a benefit from its own unreasonable conduct in these proceedings. (d) The decision not to proceed with the hearing was reasonable in circumstances. To proceed would have denied the Applicant procedural fairness, and on any view, the proceedings were not ready for hearing. There was further work that needed to be completed and insufficient time for this to occur prior to the commencement of the hearing on 31 July 2018. 1. The Applicant maintains (i) that its DA was, and remained, always "ready for assessment", (ii) that it was and remained supported by experts in all relevant disciplines, and (iii) that the Applicant endeavoured to react/respond constructively to concerns of Council (and RMS) as they arose, so as to narrow the issues in dispute (Tp26, LL5-40, and Tp42, LL10-12). 2. The Applicant further argues that it was reasonable for it, in late July, to seek to vacate the hearing dates, or discontinue the proceedings, because: 1. it was prejudiced as to its responding in a timely way to Council's "entirely new" contentions relating to flood modelling, upon which the Applicant had engaged Cardno; 2. the RMS's complete reversal of its position was not to be expected, and was unexplained; 3. the Council's planner refused to deal with new contentions: 4. the tree material was served very late; and 5. as submitted (subs par 31): (a) Council's late amendments to its contentions dated 3 July 2018, which introduced entirely new and unanticipated contentions (and the Applicant's inability to respond to the contentions in such a short timeframe) (b) Council's refusal to allow the Applicant's additional expert to participate in the joint conferencing and reporting process on hydrological issues (c) Council's town planner's refusal to consider additional material and information, despite the material and information being responsive to the Council's new and unanticipated contentions (d) A joint report in relation to hydrological contentions had not been provided to the parties (e) A joint report in relation to traffic and parking contentions had not been provided to the parties (f) Council intended to include material in the Council's tender bundle relating to its street tree masterplan, which none of the experts had considered in their evidence (g) Council had not provided proposed conditions of consent, and (h) Council had not responded to the material and information provided in relation to contamination contentions. (See also subs par 43.) 1. The Applicant says that the 31 July hearing could not proceed, because the Applicant was unable to respond, "in time", to: 1. "the entirely new flooding contentions", and 2. the traffic contentions (with no joint report available and the worry of the RMS reversal). 1. The Applicant's notes on its chronology say (at 4g): The circumstances were very unfortunate, but a confluence of circumstances largely beyond the Applicant's control meant that it was not unreasonable for it to decide to not pursue the matter at the final hearing. There is no evidence that it could not have done so (i.e. there is no evidence that it did not have expert support for its DA), and in light of the RMS's position, if the Court had refused the DA there would have been no basis for the Council to seek its costs. 1. The Applicant decided to "withdraw" the Class 1 appeal, because it had reached the conclusion that its DA needed "greater prospects of success" than it then appeared to have. 2. The Applicant does not concede (Tp29, LL16-20) that "mere absence of [RMS] concurrence ... was fatal to the application". 3. The Applicant also says that it "should not be exposed to an adverse costs order, when the steps it was trying to take were to eliminate, or at least narrow, the issues in dispute". It submits (Tp30, LL15-18) that: "... seeking leave to amend the DAs is not, by any stretch, an exceptional circumstance even if amendments are more than minor. The only consequence of an application proposing amendments that are more than minor is the automatic costs order that follows under the old s 97B of the Act."; and (Tp42, LL25-26, and p43, LL8-10 and LL31-34) that: "was sensible to discontinue in the circumstances it did". It should not be "penalised with an adverse costs order" when it found itself faced with "about 5" "unenviable circumstances ... largely beyond its own control". "Francis was otherwise ready, willing and able to proceed to joint conferencing and finalize the joint report ... [T]he only thing that was holding him back was the flood modelling, which only arose from the new contentions". 1. On the disputed questions regarding delay, the Applicant says (subs par 46): When all of the circumstances of this matter are considered, Council has not made out its principal reason given for an order for costs. The bulk of what is referred to as "delay'' on the part of the Applicant was a consequence of Council serving its amended Statement of Facts & Contentions one month late and less than one month before the hearing. 1. During oral argument, the Applicant conceded three (but I can find four) errors or faults on its part: 1. "Inadvertence" in respect of the provision of its expert traffic report (Tp31, L44-p32, L2). The Applicant submits (Tp32, LL5-7) that "a mere inadvertence is not something that would sound in costs", whereas the Council submits (Tp47, LL15-23) that it "ought" do so; 2. Its failure to object to the Council's ASFC, because it raised "new and unanticipated" issues, which required involvement of "other" experts, and took advantage of the opportunity provided by the Applicant's amendment of its application (Tp34, LL21-29). The Council rejects such a characterisation (Tp47, L25-p48, L24); 3. Its failure to object to the Council's changing of experts (on or about 5 July 2018), without explaining its reasons (Tp34, LL31-38): and 4. (my added, fourth, "error") Its failure to relist the matter to secure directions for the involvement of the Cardno expert, Mr Hentschel (Tp35, LL40-48). The Council contends (Tp51, LL34-36) that Hentschel "was in play", and not simply known to be working in the background for Francis, from 9 May 2018, and that it was his materials which "gave rise to the" ASFC. 1. However, counsel for the Applicant insists (Tp44, LL32-33) that "there is no relevant unreasonableness on the part of the applicant ...". 2. On the other hand, the Applicant complains about some inconsistencies in the Council's approach to the appeal – refusing the Applicant's involvement of Cardno's Mr Hentschel, but insisting that, when the RMS adopted a supportive position, it should be forced to attend the hearing to give evidence (Tp36, LL37-42). Consideration 1. The Applicant's submissions and explanations, both written and oral, set out at length above, are, in my view, clearly to be preferred. 2. As the Applicant says (subs par 9), what occurred in the preparations for hearing of this Class 1 appeal were/was "not an unusual or unreasonable turn of events in Class 1 proceedings". 3. As others might say ([32] above), all of the key events can be seen to be part of the "usual 'argy bargy' that goes on between an applicant and Council" in the course of development assessment and Class 1 appeals. Conclusions 1. In those circumstances, I find no basis for an order for costs in favour of Council, beyond those costs already ordered, and its NOM will be dismissed. 2. In terms of the costs of the costs argument itself, although I have not concluded that Council had a particularly strong case for an order for its costs of the proceedings, I accept that it did have an arguable case for seeking such an order. 3. It is appropriate, therefore, to order that each party pay its own costs on the NOM. Orders 1. The orders of the Court are: 1. The Notice of Motion brought by Council on 16 August 2018 is dismissed. 2. Each party is to pay its own costs on that Notice of Motion. 3. The Exhibits may remain in the Court file. ********** 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: 12 November 2018