Chief Executive, Department of Natural Resources and Mines v Sabina Three Gorges Corporation Ltd [2001] QLC 26

LAND COURT BRISBANE 12 APRIL 2001 Re: V00-43 to 50; AV00-344 to 346 and V99-340 Appeals against Unimproved Valuations Valuation of Land Act 1944 Local Government: Townsville Chief Executive, Department of Natural Resources and Mines Applicant v. Sabina Three Gorges Corporation Ltd Respondent APPLICATION FOR COSTS 1. The respondent to this application was the owner of certain land in Townsville at 1 October 1996 and 1 October 1999. The applicant had valued that land pursuant to the provisions of the Valuation of Land Act 1944 and the respondent had appealed to this Court with respect to those valuations totalling 12 in number. These appeals were lodged by Boulton, Cleary & Kern, Solicitors, on behalf of the respondent. The Notices of Appeal for the valuations of 1 October 1996 were dated 23 March 2000 in all cases excepting one, which was dated 30 June 1999. The appeals with respect to the valuations for the 1 October 1999 date were all dated 4 August 2000. 2. By various letters the Registrar of this Court wrote to both parties advising that the matters under appeal would be set down for hearing at the next available sittings in Townsville. By formal notice dated 9 October 2000 the appeals were set down for hearing, together with some other matters, with the hearing to commence not before 10.1 a.m., 28 November 2000. Directions hearings were held on 24 October 2000 then on 8 November 2000 and orders were issued bearing the latter date. A further directions hearing on 16 November 2000 resulted in a variation of the earlier orders issuing that day. These orders were: 1. That on or before the Seventeenth day of November 2000 the Appellants give notice in writing to the Registrar and to the Respondent of any ground of appeal which is abandoned. 2. On or before the Seventeenth day of November 2000 the Appellants provide further and better particulars of the grounds of appeal apart from grounds 2 and 3 upon which they intend to rely at the hearing. [2001] QLC 26 -- 1 of 8 -- 2 3. That on or before the Twentieth day of November 2000 the Appellants make disclosure of documents with respect to each ground of appeal upon which they intend to rely at the hearing. 4. That on or before the Twentieth day of November 2000 the parties deliver to the Registrar and serve upon the other party a list of witnesses intended to be called at the hearing. 5. That the date for delivery of witness statements and of the reports of experts be the Twenty-second day of November 2000 and two (2) copies of each be provided to the Court. 6. That the experts confer for the purposes of Rule 23(5) on or before the Twenty-fourth day of November 2000. 7. That the document required by Rule 23(5) be prepared and delivered to the Registrar on or before the Twenty-seventh day of November 2000 before 10.00 a.m. 8. That the evidence in chief of all witnesses intended to be called be provided in the form of written statements or reports. 9. That the parties confer and provide to the Court by commencement of the hearing an outline of the matters of law in dispute. 3. By notice dated 22 November 2000 filed and served that day, solicitors for the respondent withdrew all of the abovementioned appeals. Withdrawal is provided for in Rule 16 of the Land Court Rules 2000: "Notice of discontinuance or withdrawal 16.(1) A discontinuance or withdrawal is effected by filing a notice in the approved form and serving it as soon as practicable on the other parties to the proceeding. (2) If a party to whom the discontinuance or withdrawal relates consent to the discontinuance or withdrawal, the party must sign the notice before the notice is filed. (3) If the party’s consent is on conditions, the conditions must be stated on the notice. (4) If the discontinuance or withdrawal is effected within 7 days before the date set for hearing the proceeding, the court may require the parties to explain the reason for the late discontinuance or withdrawal. 4. The consent of the applicant in the present proceedings was not endorsed on the notice of withdrawal. Notwithstanding the absence of consent, the filing and serving of a notice of withdrawal is sufficient to effect withdrawal (Rule 16(1)). -- 2 of 8 -- 3 5. By a document dated 24 November 2000 and filed on that day, the applicant sought an order that the respondent "pays the costs of the applicant" in the withdrawn matters. That document was presented as "Form 17 R.51 of the Land Court Rules 2000", however, did not include the "facts, circumstances or other relevant matters" on which the application was based, nor the grounds on which the order for costs was founded. The respondent was served, through its solicitors, by facsimile on 27 November 2000. 6. By an application dated 27 November 2000, Boulton Cleary & Kern sought leave to withdraw as solicitors on the record for the respondent. That application was granted on 29 November 2000. 7. The application for costs was initially heard on 28 November 2000 where it became clear if clarity was indeed needed, that, whereas the applicant had complied with the orders of the Court of 16 November 2000, the respondent had not complied with them and I refer in particular to orders numbered 2 to 5 inclusive, each of which required compliance on or before 22 November 2000, the date of withdrawal. 8. In the circumstances, I decided on 28 November 2000 that the respondent should be provided with an opportunity to respond to the application and, accordingly, ordered that it be provided with a transcript of the application and be afforded time to respond. 9. On 22 December 2000 McMahons, Solicitors, provided submissions in response to the application for costs. In that response the respondent submitted: "Appeals were also filed by Lakes Investment Pty Ltd and Landel Pty Ltd arising out of the same development. It was expected that the Lakes Investment Pty Ltd appeal would be argued first and take the form of a 'test case'. Unexpectedly the court decided to hear all the appeals arising from the Lakes Stage 2 valuation together and they were all set down for hearing in the Land Court from 28 November to 1 December 2000. When that occurred the respondent formed the view that the potential savings from successful appeals were outweighed by the costs that would be incurred participating in a hearing and instructed their then solicitors, Boulton Cleary & Kern to withdraw the appeals." 10. I understand the term "test case" to be referring to a case which would be heard and then decided in order that other similar cases might subsequently be settled in accordance with that decision. I observe that there is no record in the Court registry of any application having been received from the respondent in that respect. Nor was any order made in these matters or in association with other matters set down for hearing in Townsville at the same time that any matter be such a test case. In these -- 3 of 8 -- 4 circumstances it is difficult to understand why the notice of the Court setting these appeals down for hearing would be unexpected. 11. Nevertheless, I understand the respondent's point to be that it intended to have its appeals disposed of following the outcome of the Lakes Investment Pty Ltd appeal. It is probably of no relevance whether that was simply a hope held by the respondent or that it was its understanding that a formal approach might be made to the Court and to the other parties in that regard. The important point is that the respondent was not proceeding on the basis that it would prosecute its appeals solely on its own account. 12. When it became aware via the Court Notice of 9 October 2000 that its strategy could not be pursued, unless it successfully obtained an adjournment, the respondent's options were to change its strategy or withdraw. There was no application for adjournment. What the respondent did, however, was to allow the applicant to participate in directions hearings and to prepare itself on the footing that the respondent's appeals would be contested. That no trial would take place would or ought to have been known to the respondent soon after the date of notification by the Court that the matters were set down for hearing. It would or ought to have been at its most obvious during the various directions hearings and at the times at which the orders of the Court of 16 November 2000 required compliance. I do not understand anything in the submission of the respondent which points to the date of withdrawal of 22 November 2000 as being a date arrived at as an appropriate and considered date for withdrawal. It is difficult not to conclude that the lateness of the decision to withdraw was the result of tardiness, a lack or concern that the orders of the Court ought to be complied with or a failure to have regard to the inconvenience and costs being borne by the applicant. 13. Rule 18 provides for costs:. "Costs 18. If an applicant discontinues or withdraws, the court may order the applicant to pay - (a) the costs of the party to whom the discontinuance or withdrawal relates up to the date of the discontinuance or withdrawal, if the party has not consented to the discontinuance or withdrawal; and (b) the costs of another party or parties caused by the discontinuance or withdrawal." -- 4 of 8 -- 5 14. That rule appears to have been included in the Rules in order that it may be made perfectly clear to an applicant to withdraw that a late or inconsiderate application may be the subject of an order for costs. The provision of the power for the Land Court to order costs irrespective of Rule 18 is made clear in s.34 of the Land Court Act 2000:- "Costs 34.(1) Subject to the provisions of this or another Act to the contrary, the Land Court may order costs for a proceeding in the court as it considers appropriate. (2) If the court does not make an order under subsection (1), each party to the proceeding must bear the party's own costs for the proceeding. (3) An order made under subsection (1) may be made an order of the Supreme Court and enforced in the Supreme Court. (4) For subsection (3), it is enough to file the order in the Supreme Court. (5) The court may, if it considers it appropriate, order the costs to be decided by the appropriate assessing officer of the Supreme Court, under the scale of costs prescribed by law for proceedings in the Supreme Court. (6) If the court makes an order under subsection (4), the assessing officer may decide the appropriate scale to be used in assessing the costs." 15. The respondent referred me to a decision of this Court in Dreamworld Pty Ltd v. Chief Executive, Department of Natural Resources (1999) 20 QLCR 170 ("Dreamworld"), a case in which the landholder appellant applied for an order for costs against the Chief Executive because of the lateness of an offer from the Chief Executive, which was in due course accepted by the landholder, resulting in a settlement of the issues between the parties. In that case Dr Divett considered the application pursuant to s.41(9) of the Land Act 1962 the precursor to s.34 of the Land Court Act 2000, though expressed in different and in somewhat more comprehensive language. The learned Member took guidance from WH Bowden v. The Valuer- General (1980) 7 QLCR 138 and Collins Foods International (Properties) No. 2 Pty Ltd v. Chief Executive, Department of Natural Resources (1996) 16 QLCR 651 ("Collins Foods"). In the exercise of his discretion the learned Member, as I read his reasons, decided that each party should bear their own costs because each had -- 5 of 8 -- 6 contributed in some way to the lateness of the settlement of the appeal. The present case can easily be distinguished, there being no submission from the respondent that the appellant is responsible in any way for the lateness of the withdrawal of the appeals by the respondent. 16. The present case might further be distinguished from Dreamworld in that since that decision the Land Court Rules 2000 have been enacted. These Rules read as a whole, communicate a comprehensive statutory structure which together with the uniform Civil Procedure Rules 1999 which complement the Land Court Rules 2000 create a system for the pre-trial conduct of matters before the Court. In the case of the respondent's appeals, those Rules were relied upon and orders issued on 16 November 2000 with a view to exposing and narrowing the issues and in ensuring that neither party would be caught by surprise. This position may be contrasted with the position that obtained prior to the new Rules coming into effect where there were many occasions when success for one party depended to some extent on its capacity to ambush the other, the prevailing Rules being quite inadequate with respect to case management. In the circumstances of the enactment of the new Rules it must be appreciated by parties coming before the Court that, particularly in instances where parties are represented, the Court will be astute to utilise the Rules of the Court and to expect the parties to comply with orders made in reliance on the Rules. 17. Notwithstanding what I have observed concerning the significance of the enactment of the Land Court Rules 2000, some benefit can still be taken from a consideration of the authorities decided under the previous legislation. I might usefully refer to Collins Foods and I take the following quotation from pp.664-665: " Although the Land Court’s discretion is unfettered, it must be exercised judicially, that is, by reference to relevant considerations (for example see Townsville City Council v Moyses and Morris (1979) 6 QLCR 271 at 273-4, WH Bowden v The Valuer-General at 144-7). It is apparent that the attitude which the Court should take in the exercise of its discretion is primarily one of restraint which, speaking broadly, may be exercised against a party if the Court is satisfied that the party acted arbitrarily or capriciously, or in a frivolous or vexatious manner. In dealing with applications for costs made under section 70 of the Valuation of land Act 1944 (previously numbered section 22), the Land Court and Land Appeal Court have generally adopted a restrained attitude, emphasising the desirability of easy access to the Land Court to air grievances and have valuations reviewed. Such access 'should be available without fear of costs being awarded to either party except in special cases' (see Bowden’s case at 147). -- 6 of 8 -- 7 This is not to say that the Court will not, in a proper case, make an award of costs, but there would need to be sufficient reason for such an award. In exercising its discretion, the Court necessarily takes into account all of the circumstances then appearing. Such cases include cases where a party may justifiably seek costs through lateness of notice, or where the Court is satisfied that proceedings are of a frivolous or vexatious nature or perhaps where a hearing is adjourned due to the wrongful conduct of a party (see Bowden’s case at page 146 and The Valuer-General ats Queensland Club (1990-91) 13 QLCR 207 at 222-4 (Land Appeal Court) and cases cited therein)." 18. The learned Member on that occasion did not say that a party would need to act arbitrarily or capriciously or in a frivolous or vexatious manner as a prerequisite to an order for costs going against him, but that such behaviour, inter alia, might be expected to give rise to an order for costs. At p.666 of his reported reasons the Member said that he was not convinced that the respondent's representative in that case had acted arbitrarily or capriciously or in a frivolous or vexatious manner, however, remained satisfied that the circumstances surrounding the withdrawal of the appeal in that case were such that an order for costs was warranted. 19. I too find that an order for costs is warranted in the matter before me. The reason advanced by the respondent for the lateness of withdrawal of the appeals is a reason without proper foundation. In addition, no explanation has been forthcoming as to the failure to comply with the orders of the Court of 16 November 2000. Whatever epithet might be employed to describe the behaviour of the respondent in these respects, it is clear to me that the orders of the Court were treated as an irrelevancy. 20 The respondent made the following submission: " If the Court is of a mind to order costs against the respondent it is submitted that the costs should be limited to the costs of the Department thrown away by the withdrawal of these appeals. The issues involved in these appeals are the same as the issues involved in the appeals commenced by Landel Pty Ltd and Lakes Investments Pty Ltd. The preparation for hearing required by the Department for the hearing of the appeals commenced by Sabina were also required for the hearing of the appeals commenced by Landel Pty Ltd and Lakes Investments Pty Ltd and as such the Department has incurred little or no extra cost due to the commencement and the withdrawal of the appeals by Sabina." 21. I understand the force of this submission, however, am of the view that I need not qualify my costs order in such a way that the concern raised by the respondent is reflected in it. My understanding is that the officer charged with taxing costs should -- 7 of 8 -- 8 take into account the point raised by the respondent in such a manner that the respondent is not required to pay costs which are not attributable to it. 22. The applicant in this matter seeks an order that the respondent pay the applicant's costs of and incidental to the appeals to be taxed. It submits that whilst there are costs thrown away in relation to preparing for the hearing of the appeals, any costs order should not be confined to those costs. Counsel for the applicant submitted, "If there are any earlier costs the appellant caused those to be incurred and has withdrawn the platform upon which they might ultimately be awarded. Had the appeals proceeded there might have been an order but it's chosen to collapse the proceedings and put the respondent in a position where it can't do anything other than to apply under rule 18 for an order." 23. I think that it is appropriate that the respondent be held responsible for costs incurred after it became clear, or ought to have become clear, that it needed to act to withdraw its appeals or decide to prosecute them. That date was 9 October 2000, the date of the notice of hearing. Any costs incurred by the applicant before this date would be costs arising out of its statutory duty or costs incurred in anticipation, only, of the appeals being set down for hearing. The applicant submits that given the stated strategy of the respondent, it is clear that its appeals were lodged on a speculative basis and that the administrative costs which fell to the applicant as a result of the lodgment of these appeals should be encompassed by any costs order. I am aware that appeals under the Valuation of Land Act 1944 are often lodged on a protective basis, as a protest or as a tool of negotiation, as well as being the means of initiating litigation. Whilst there are no statutory fees payable for the lodgment of such appeals - a rarity in these times of rational economics - it seems to me that I should hesitate to extend my costs order in the manner prepared by the applicant. To do so may be understood by landowners as creating a hurdle to the free lodgment of appeals. That would, I think, be contrary to what the Land Appeal Court said in Bowden's case. 24. I order that the respondent to this application pay the applicant's costs of and incidental to the appeals, such costs being incurred not before 9 October 2000 to be ascertained and fixed by the appropriate assessing officer of the Supreme Court at Townsville according to the scale of costs prescribed by law for the time being in respect of proceedings in the Supreme Court and in accordance with the provisions of s.34 of the Land Court Act 2000. RP SCOTT MEMBER OF THE LAND COURT -- 8 of 8 --