Berry & Anor v Gold Coast City Council [2011] QLC 53 (2011) 32 QLCR 251

LAND COURT OF QUEENSLAND CITATION: Berry & Anor v Gold Coast City Council [2011] QLC 53 PARTIES: Colleen Patricia Berry and Francis John Sheehan (as Trustees) (applicants/respondents) v. Gold Coast City Council (respondent/applicant) FILE NO: AQL036-11 DIVISION: General Division PROCEEDING: Application DELIVERED ON: 22 August 2011 DELIVERED AT: Brisbane HEARD AT: Brisbane PRESIDENT: CAC MacDonald ORDER: The application for a partial joint hearing is refused. CATCHWORDS: Practice and procedure – partial joint hearing – s.79 Uniform Civil Procedure Rules 1999 – discretion to order joint hearing – guidelines considered – application refused. APPEARANCES: Mr E Morzone of Counsel for the applicants/respondents Mr B Cronin of Counsel for the respondent/applicant Mr D Gore QC, by leave, for Halcyon Waters Community Pty Ltd SOLICITORS: Collas Moro Ross for the applicants/respondents Gall Standfield Smith for the respondent/applicant Anderssens Lawyers Pty Ltd for Halcyon Waters Community Pty Ltd [1] The principal proceeding in this matter is a claim for compensation brought by Colleen Patricia Berry and Francis John Sheehan (as Trustees) against the Gold Coast City -- 1 of 8 -- 2 Council (the Berry & Sheehan proceedings) in respect of the compulsory acquisition of land under the provisions of the Acquisition of Land Act 1967 (the Act). [2] In addition to the Berry & Sheehan proceedings a claim for compensation has been filed in this Court by Halcyon Waters Community Pty Ltd against the Chief Executive, Gold Coast City Council (AQL359-09, the Halcyon proceedings) in respect of the compulsory acquisition of land adjoining the Berry & Sheehan land. [3] This decision deals with a general application filed by the Gold Coast City Council (the Council) on 25 March 2011 for an order that the Berry & Sheehan and Halcyon proceedings be heard together. The Berry & Sheehan proceedings [4] The Berry & Sheehan land was taken by the Gold Coast City Council for park, recreation ground and road purposes on 24 April 2008. The land taken was the whole of Lot 131 on SP 192584 in the Parish of Coomera, County of Ward, containing an area of 1.713 ha. [5] The claim for compensation was filed in this Court on 9 February 2011. The claimants have asserted that, as at the date of resumption, the highest and best use of their land was for residential development. As the land was subject to partial flooding, the claimant identified the minimum developable area of the land as 5,900 m² and, on the basis that a subdivision of that area of land would yield 28.6 unit dwelling sites which the claimant valued at $87,000 per site, sought compensation for loss of land in the sum of $2,490,000.00, together with compensation for disturbance, and interest. [6] The Council has paid an advance of $800,000 to Berry & Sheehan. It appears that that advance was calculated on the basis of a report prepared by Cardno Lawson Treloar (CLT) for the Gold Coast City Council on the flooding characteristics of Lot 131.1 That report determined that .16 ha of the site could have been filled in a site only filling scenario, and that .05 ha could be filled in an equitable filling scenario. [7] Prior to the resumption, Lot 131 was adjoined on its western boundary by Lot 11 on SP 204098 which was 19.11 ha in area. Lot 11 was owned by Halcyon Waters Community Pty Ltd. The northern part of Lot 11, 4.35 ha, was resumed on 24 April 2008 in the same taking of land notice and for the same purposes as Lot 131. The resumed land became Lot 101 on SP 214275. [8] At the time of the resumption of Lot 101, an approval existed for the development of Stage Two of the Halcyon retirement development on that land, incorporating a retirement community, a shop (chemist) and doctor's room. The approval allowed the filling of 1.3 ha on Lot 101 but conditions 34 and 35 of the approval required 1 Exhibit DRS2 to the affidavit of DR Standfield filed 29 March 2011. -- 2 of 8 -- 3 certification from a qualified registered hydraulic engineer, prior to commencement of works on site, to support an operational works (change to ground level) application. There is evidence that modelling indicates that such fill would alter the existing water flow patterns on Lot 131 by concentrating the flow entering Lot 131 from the west, to the northern section of the lot, rather than it being more evenly distributed across the western boundary.2 [9] Mr N Collins, the hydraulic expert commissioned to provide an expert report for Berry & Sheehan has challenged the correctness of the hydraulic assessment undertaken by Lawson and Treloar with respect to Lot 101 which was the basis of the development approval for the material change of use approval. Mr Collins said that a review of the CLT assessment revealed that the modelling had assumed that the 1.3 ha fill was in place and that there was no main roads upgrade. This did not reflect Council's planning as ultimately adopted. Based on Council's ultimate development outcome for the area and the further modelling undertaken by his company, Mr Collins concluded that "it is our opinion that our client was disadvantaged by the CLT July 2007 assessment and that a more accurate assessment incorporating the removal of the 1.3 ha fill area and inclusion of the proposed main roads and Halcyon Way upgrades to ARI 100 year immunity, would have produced a more favourable outcome for our client in terms of compensation". [10] Both Mr Collins and Dr M Jempson, the expert commissioned by the Council, have said in their joint report prepared for the Berry & Sheehan proceedings that the certification required by conditions 34 and 35 of the Stage 2 approval of the Halcyon Waters development would not have been achieved. They say that if the Halcyon land were not filled in accordance with the development approval, Lot 131 would be advantaged in that the land could be more extensively developed. Mr Collins says that 5,900 m² of the land would be developable, Dr Jempson asserts a lesser area, in the vicinity of 4,100 m². The Halcyon proceedings [11] As noted above, Halcyon Waters Community Pty Ltd were the owners of Lot 101 prior to its resumption by the respondent on 24 April 2008. Halcyon filed a claim for compensation in this Court on 11 August 2009 in the sum of $16,060,000 plus disturbance and interest. in respect of the resumption of Lot 101. This proceeding is well advanced such that the parties will be in a position for the matter to be heard either before the end of this year or early in 2012. 2 Joint hydraulic report form N Collins and M Jempson, Exhibit WJR2 to the affidavit of WJ Ross filed 15 July 2011. -- 3 of 8 -- 4 [12] In contrast to the Berry & Sheehan proceedings, the parties in the Halcyon proceedings are not agreed that the certification contemplated by conditions 34 and 35 of the Halcyon Waters Stage 2 approval of 16 February 2007, may not have been achieved. Halcyon's expert (Dr Johnson) contends that he would have been able to provide the certification required by conditions 34 and 35 whereas, consistently with his opinion in the Berry & Sheehan proceeding, Dr Jempson for the Council expresses a contrary view. Further, Halcyon says that there is another issue, namely, whether in view of the long history of approvals relating to the Halcyon development, a competent hydraulic engineer would have advised a hypothetical purchaser that it was not necessary to carry out any further computer modelling. The application [13] The application for a joint hearing was filed in the Berry & Sheehan proceedings and leave was given for Halcyon Waters Community Pty Ltd to appear and be heard in respect of the application. It was made clear by Mr Cronin of counsel for the Gold Coast City Council at the hearing of the application that the Council sought a partial joint hearing only, to be limited to a hearing of the hydraulic evidence in both cases, on the basis that the hydraulic evidence in each case be treated as the hydraulic evidence in the other. [14] The principal basis on which the order for a partial joint hearing was sought was that it would be unfair for the Council to be faced with the possibility of different findings as to whether Halcyon would have obtained the required certification under conditions 34 and 35 of the development approval and consequently have been in a position to fill 1.3 ha of the site. If there were a finding in the Berry & Sheehan proceedings that the 1.3 ha of fill on the Halcyon land could not progress, a larger area of the Berry & Sheehan land could be developed and the result in those proceedings could be a higher valuation of $1,690,000. On the other hand, if there were a different finding in the Halcyon proceedings, namely that the 1.3 ha could be filled, the valuation of the Halcyon land could be $5,500,000 higher. [15] Mr Cronin said that the hydraulic evidence would be given by three experts if heard together, that is a hydraulic expert for each claimant with Dr Jempson giving evidence for the Council. Mr Cronin submitted that the time and cost difference between the two hearings was not particularly significant. However different findings of fact could result in very substantial differences in awards for compensation. It was undesirable that inconsistent findings of fact should be made and the way that this could be avoided was to hold a joint hearing in relation to the hydraulic evidence. -- 4 of 8 -- 5 [16] The application has been strenuously resisted by Berry & Sheehan and Halcyon. Consideration of the issues [17] This application was brought under s.79 of the Uniform Civil Procedure Rules 1999 which, by virtue of s.4(1) of the Land Court Rules 2000 applies to proceedings in this Court. Section 79 provides - "79 Sequence of hearings The court may order that 2 or more proceedings be heard together or in a particular sequence." [18] As s.79 does not say anything about the matters which the Court is to take into account in deciding whether to make an order under the section, it appears that the Court has an unfettered discretion as to whether to make such an order. [19] The authorities indicate that a number of factors have been considered relevant in exercising such a discretion. There are no inflexible rules.3 In Cameron v McBain4 Herring CJ said that - "The question would seem to be whether in all the circumstances it is convenient that the actions be consolidated, and in deciding whether it is convenient, regard may be had to such matters as the desirability of avoiding multiplicity of actions, and the saving of time and expense. At the same time the interests of the parties should not be prejudiced by the making of an order."5 [20] In Bishop v Bridgeland Securities6, Wilcox J set out the principles which he considered should guide the exercise of such a discretion. He said that the basic principle to be applied is that the Court should take whatever course seems to be most conducive to a just resolution of the dispute between the parties, having regard to the desirability of limiting, as far as practicable, the cost and delay of litigation. [21] In Ghose v CX Reinsurance Co Ltd7 Austin J said that the task of the Court is to "work out pragmatically whether the most efficient course consistent with the requirements of fairness would be consolidation, a joint hearing, sequential hearing, entirely separate hearings or something else (such as determination of separate questions prior to or after the hearing of the remainder of the proceedings)". [22] In Humphries v Newport Quays Stage 2A Pty Ltd8 Besanko J stated that the relevant factors in deciding whether actions should be tried together are - 3 See Cousins v Cousins (1948) 51 WALR 57 at 60. 4 [1948] VLR 245 at 247. 5 Although Herring CJ was discussing consolidation, it appears that the same principles apply when the application is for a joint hearing (Ghose v CX Reinsurance Co Ltd [2010] NSWSC 110 at [27]). 6 Bishop v Bridgeland Securities (1990) 25 FCR 311 at 314. 7 [2010] NSWSC 110 at [27]. 8 (2009) FCA 699 at [11]. -- 5 of 8 -- 6 "1. Are the proceedings broadly of a similar nature? 2. Are there issues of fact and law common to each proceeding? 3. Will witnesses (lay and expert) in one proceeding be witnesses in one or more of the other proceedings? 4. Has there been an alternative proposal put forward that there be a test case and have the parties agreed to abide the outcome, or, at least, the determination of common issues of fact and law? 5. Is there a prospect of multiple appeals with substantial delays if the proceedings are not tried at the same time? 6. Will there be a substantial saving of time if the proceedings are tried at the same time compared with each proceeding being tried separately? 7. Will an order that the proceedings be tried at the same time create difficulties in terms of trial management, complexity of procedural issues and difficulties of determining cross-admissibility of evidence? 8. Is one proceeding further advanced in terms of preparation for trial than the others? 9. Are there parties to one or some only of the proceedings who will be inconvenienced if all of the proceedings are tried at the same time?" [23] It can be seen from the extracts from the authorities set out above, that it is necessary to balance all the relevant factors in deciding whether to order a joint hearing. The Council has asserted that it would be fundamentally unjust if there were different findings of fact in relation to the hydraulic issues in each of the cases. Strictly speaking, it is not the function of this Court to determine whether in fact the 1.3 ha of Halcyon land could be filled. In both proceedings the Court has to decide the market value of the resumed land as at the date of resumption by deciding what the hypothetical prudent purchaser would pay for the land, on the basis that such a purchaser was aware of all the facts that would affect its value.9 As is common in cases of this nature, the claimants have commissioned experts to provide their opinions as to various issues relevant to the determination of value and have submitted that that information would have been available to the hypothetical prudent purchaser on the date of resumption. [24] In the Berry & Sheehan proceedings, the expert hydraulic engineers have agreed that Halcyon would not be able to fill the 1.3 ha because no hydraulic engineer would provide the certification required by conditions 34 and 35. There is therefore no live issue between the parties in that proceeding as to whether the 1.3 ha could be filled. If the hydraulic evidence in both proceedings were heard together as proposed by the Council, Halcyon's evidence as to its capacity to comply with conditions 34 and 35 would become 9 Spencer v The Commonwealth (1907) 5 CLR 418 at 440, 441 (Isaacs J). -- 6 of 8 -- 7 evidence in the Berry & Sheehan proceedings and thus create an issue in those proceedings that would not otherwise arise. The consequence may be that the compensation payable to Berry & Sheehan may be $1,690,000 lower than if that issue had not been raised. [25] It is also the case that Berry & Sheehan and Halcyon have the right to bring two separate claims. Each claim arises out of a separate event, namely the acquisition of two separate parcels of land. The claimants in each proceeding have a substantive right to recover compensation for the value of the land taken. The respondent has a substantive correlative contingent liability in the same amount. In those circumstances, to make a procedural order which would lessen the potential value of the Barry & Sheehan claimants' substantive rights and lessen the respondent's correlative substantive contingent liabilities would work a radical reordering of the parties' substantive rights and obligations, with the risk of substantial prejudice to those claimants.10 [26] Further, I consider that it is relevant to take into account the fact that compulsory acquisition proceedings differ from ordinary litigation in that the claimants in compulsory acquisition proceedings have no choice whether to make a claim or not.11 In those circumstances it would seem unfair to force claimants such as Berry & Sheehan into a joint hearing where they would face, potentially, a substantially lower compensation determination. [27] Berry & Sheehan would also become involved, unwillingly, in proceedings which are significantly more complex than if their claim were heard separately. The applicant in the Halcyon proceedings claims compensation of some $16,000,000 for the loss of land. Those proceedings are complex and it is estimated will involve a two week trial with as many as eleven expert witnesses giving evidence. By contrast, the claim in the Berry & Sheehan proceedings is for approximately $2,500,000; the central issue is the maximum developable area of the land as at the date of acquisition and it is estimated the trial will be a two day trial. While the order sought by the Council is limited to a joint hearing of the hydraulic evidence, the claimants in the Berry & Sheehan proceedings will be involved in additional expense as their legal advisers and hydraulic engineer will be required to undertake significant additional work in order to meet the evidence in the Halcyon proceedings as to the ability to fill the 1.3 ha of land. 10 See Buckley v The Herald and Weekly Times Pty Ltd [2009] VSCA 118 at [12]. 11 See Yalgan Investments Pty Ltd v Council of the Shire of Albert (1997) 17 QLCR 401 at 407; Minister for the Environment v Florence (1980-81) 45 LGERA 127 at 149; Banno v Commonwealth of Australia (1993) 81 LGERA34 at 35. -- 7 of 8 -- 8 [28] It is also relevant that the claimants in each proceeding have a right of appeal from any determination of compensation following the hearings. If a determination were made in respect of the jointly heard hydraulic evidence that the Halcyon land could not be filled, the claimants in the Berry & Sheehan proceedings would possibly be faced with an adverse finding in an appeal in the Halcyon proceedings in respect of a matter which would not have been an issue if the Berry & Sheehan claim had been heard separately. [29] It is acknowledged that it is undesirable that there should be inconsistent findings of fact in separate proceedings. However, while that is a factor to be taken into account in exercising the discretion given under s.79, it is not a determinative factor.12 In my opinion, the factors pointing to a refusal of a joint hearing as set out above significantly outweigh those in favour of such a hearing. I consider that the material prejudice that would be suffered by Berry & Sheehan if a partial joint hearing were ordered is such that the application should be refused. ORDER The application for a partial joint hearing is refused. CAC MacDONALD PRESIDENT OF THE LAND COURT 12 Ghose v CX Reinsurance Co Ltd [2010] NSWSC 110 at [95]. -- 8 of 8 --