Council of the City of Caloundra v Beerwah Pine Pty Ltd [1991] QSC 97

I i I { ! I I ) 10 30 !~R·, i=•-:-11 "'=O r.--:;;,n, · r_:-;:-,: ''t.:~:, - 1 ,_ ,Ur~- ..._, .. _, • -•'' •,.,. • _; I C:.:it!d Repcrt::1: ~·:~1rt:;au i Dc:te, :J..,/ S- I 9t __ ....__ _______ ,., IN THE SUPREME COURT OF QUEENSLAND CIVIL JURISDICTION No. 385 of 1991 BEFORE MR. JUSTICE LEE BRISBANE, 11 APRIL 1991 (Copyright in this transcript is vested in the Crown. Copies thereof must not be made or sold without the written authority of the Chief Court Reporter,Court Reporting Bureau.) BETWEEN: COUNCIL OF THE CITY OF CALOUNDRA -and- BEERWAH PINE PTY LTD JUDGMENT Plaintiff Defendant HIS HONOUR: On the question of the application by counsel for the defendant to read and file an affidavit before me before I hand down judgment, an affidavit which apparently has only just been prepared, this was objected to by counsel for the plaintiff on the basis that it deals with matters argued before me on the hearing, and also on the basis that depending upon the decision which I am about to deliver, it may be that 10 20 30 40 40 50 60 the defendant could bring a further application consequent upon that decision, if that was thought necessary by it. In the circumstances, I decline to receive the further affidavit material at this late stage, and particularly having regard to the fact that the proceedings are interlocutory in nature. For the reasons which I am about to publish, and in the exercise of my discretion, I have decided on balance that the injunction as sought should now be declined and the matter allowed to go to trial as speedily as possible. Govt. Printer, Qld. 1 50 60 -- 1 of 33 -- 10 20 30 40 50 60 ----~- ----- ------------- --- Accordingly, the application is dismissed. Costs of and incidental to the motion are reserved. The action is certified as one which should be tried speedily. Further order as follows: defence and counterclaim within seven days; reply and answer within three days 10 of delivery of the defence and counterclaim; each party to serve and file an affidavit of documents within three days after delivery of the reply and answer; inspection within three days thereafter; leave to either party to deliver interrogatories for examination of the other within three days after 20 n. inspection; answers by affidavit within seven days of delivery; abridge the time for the · return of a duly tendered signed certificate of readiness to three days after delivery. Order accordingly. I publish my reasons. Govt. Printer, Old. 2 (~_) 30 0 40 (J' \. 50 60 I -- 2 of 33 -- l 1. 1. I, t I [ 1. I, ll t l 1, II 1: n C) () IN THE SUPREME COURT OF QUEENSLAND Writ No. 385 of 1991 Before Mr. Justice Lee BETWEEN: COUNCIL OF THE CITY OF CALOUNDRA Plaintiff AND: BEERWAH PINE PTY. LTD. Defendant JUDGMENT - LEE J. Delivered the 11th day of April, 1991 CATCHWORDS: Q Counsel: Mr. G.H. Brandis for applicant/plaintiff Mr. R.J. Douglas Q.C. respondent/defendant and J.D. Batch for Solicitors: Watkins Stokes, town agents for Heiner & Doyle for applicant/plaintiff Carberry & McGuire for resp_ondent/defendant Hearing date: 12th March, 1991 -- 3 of 33 -- I . [ l l l 1. I. I, I. r ), I. 1. 1. I f r t n 0 IN THE SUPREME COURT OF QUEENSLAND Writ No. 385 of 1991 BETWEEN: COUNCIL OF THE CITY OF CALOUNDRA Plaintiff AND: BEERWAH PINE PTY. LTD. Defendant JUDGMENT - LEE J. Delivered the 11th day of April, 1991 The plaintiff, the Council of the City of Caloundra, by notice of motion filed 4th March, 1991, seeks an order that the defendant, Beerwah Pine Pty. Ltd. (Receiver and Manager appointed) by itself, its servants or agents, be restrained until the trial of this action or further earlier order from causing nuisance by reason of the emission from its property at Back Creek Road, Beerwah in the State of Queensland, of levels of noise in excess of maximum levels set out in the schedule to the statement of claim served with the notice of motion. The schedule to the statement of claim shows three different maximum levels of noise depending upon the time of day or night or on Sundays and public holidays when the defendant operates its timber mill on the above property. By the writ (also issued on 4th March, 1991) and the statement of claim, the plaintiff claimed two types of injunctions:- -- 4 of 33 -- 2 (1) an injunction to restrain the defendant from carrying out activities in and about the property so as to cause noise levels to exceed the levels set out in the schedule to the statement of claim; and (2) a mandatory injunction requiring the defendant to take all such steps as are necessary and suitable to ensure that the level of noise does not exceed the above levels, including undertaking the noise abatement measures. Some dispute occurred over what precisely the plaintiff was claiming in this particular notice of motion. Counsel for the plaintiff submitted that care had been taken to seek in the notice of motion, only an injunction prohibiting excessive noise, and not a mandatory injunction compelling the defendant to abate the noise as also claimed in the writ and statement of claim. He further submitted that the plaintiff's claim for interlocutory relief was based upon nuisance, a breach of the by-laws of the Council, and a breach of a deed between the parties dated 1st June, 1989. 0 CJ 0 It was also submitted that this case involved a public () nuisance so that the principles referred to in the judgment of the Privy Council in Associated Minerals Consolidated Ltd. v. Wyong Shire Council (1974) 48 A.L.J.R. 464 at 470 applied viz. that by reason of s. 52(8) of the Local Government Act 1966-1984, the plaintiff was seeking relief in the public interest so that it is necessary to base the granting or denial of equitable relief on broader grounds than would normally apply as between private citizens. This means a weighing of injury to the public -- 5 of 33 -- l I ( 1. 1. L L t 1. 1. I f f I, t I f C) 0 3 interest by denial of relief, its extent and degree of irre·mediabili ty, against any loss which the defendant may have sustained by the plaintiff standing by. Counsel further relied on the statement in Doherty v. Allman and Dowden (1878) 3 A.C. 709 by Lord Cairns at 719-80 to the effect that when a negative covenant is broken (as opposed to an affirmative covenant), there was a well-settled practice that a Court of Equity had no discretion to exercise because an injunction does nothing more than give sanction of the process of the Court to that which is already in the contract between the parties, subject to the subsequent development of the law on the notion of the balance of convenience. He further submitted that the jurisdiction to award damages ought to be exercised only in very exceptional circumstances where an actionable nuisance was continuing: see Shelfer v. City of London Electric Lighting Co. (1895] 1 Ch. 287; Kennaway v. Thompson (1981] 1 Q.B. 88 at 92-93. According to the submission, it follows from these cases that the plaintiff was entitled to the interlocutory relief sought. Senior counsel for the defendant submitted that even if the plaintiff could rely in this motion on an alleged breach of covenant, the covenant in question was a positive one and not to refrain from doing something, so that Doherty v. Allman was inapplicable. However, he submitted that the application was framed only a nuisance which was the only claim the defendant was required to meet on this application and that, regardless of the way the plaintiff advanced its application, it was in fact seeking a mandatory injunction which, he submitted, required a much more stringent test referred to in the decision of Gibbs -- 6 of 33 -- 4 C. J. in State of Queensland v. Australian Telecommunications Commission (1985) 59 A.L.J.R. 562 at 563 where His Honour referred to the House of Lords decision in Redland Bricks Ltd. v. Morris [1970] A.C. 652 and a passage in Halsbury's Laws of England vol. 24 para. 948 to the effect that whilst a mandatory injunction can be granted on an interlocutory application as well as at the hearing, in the absence of special circumstances it will not normally be granted. See also the passage cited by His Honour from the judgment of Megarry J. in Shepherd Homes Ltd. v. Sandham [1971] 1 Ch. 340 at 351 as follows:- " on motion, as contrasted with the trial, the Court is far more reluctant to grant a mandatory injunction than it would be to grant a comparable prohibitory injunction. In a normal case the Court must, inter alia, feel a high degree of assurance thatat the trial it will appear that the injunction was rightly granted; and this is a higher standard than is required for a prohibitory injunction." Counsel for the plaintiff in reply referred to the decision of Carter J. in Gillespie v. Whiteoak [1989] 1 Qd. R. 284 where His Honour followed State of Queensland v. Australian 0 0 0 Telecommunications Commission (supra) and Shepherd Homes Ltd. v. Sandham (supra) in his · conclusion that "a high degree of (J persuasion" had been satisfied on the facts before him. Counsel also submitted that various decisions of the Federal Court had held that no different test applies to each type of injunction and that even if a mandatory injunction was in fact sought, the test of a "high degree of persuasion" was satisfied in this case. His fundamental submission however was that a mandatory injunction was not being sought but only a prohibitory injunction in accordance with the terms of the notice of motion which in substance follows the first claim in the writ and statement of f, -- 7 of 33 -- 1. I_ I~ 1. L 1. l l l l I. l 5 claim. No application was made to amend the notice of motion to allege a breach of the by-laws or a breach of the deed of 1st June, 1989. It is necessary to refer to the history of the matter. For some years prior to 26th May, 1988, a substantial saw mill had been conducted on the subject land and that use was an existing lawful non-conforming use under the plaintiff's town planning scheme. On the above date, the defendant applied to the ,'~ plaintiff for rezoning of the land consisting of 1.103 ha. from the "rural" zone to the "special purposes - timber mill, timber Q products and associated facilities zone". The reason for the application was that the defendant wished to expand its operations, construct new buildings and install new machinery. This also involved building and ancillary applications to the plaintiff. For some time prior to the above date, complaints had been made by local residents concerning noise, dust etc. emanating from the land. It appears from the affidavit of Barry William Sands, consulting engineer filed 12th March, 1991 that the mill had operated on the land for a considerable period when the adjoining Old Bruce Highway was the main North Coast highway carrying a constant and considerable volume of heavy and noisy traffic which tended to overshadow any noise produced by the mill. It appears from his affidavit, although the timing is not precise, that after the new Caloundra By-pass Highway was opened a few years ago, thus leaving the former Old Bruce Highway as a substantially quieter local scenic road, the noise level of the highway dropped substantially with the practical result that to -- 8 of 33 -- 6 local listeners the noise of the mill then seemed to be more acute and excessive, hence the complaints in recent years, an unfortunate result not only for the residents but also for the defendant. As a result, there has been a long period of negotiation between the plaintiff, the defendant and the Department of Environment and Heritage ("the Department") followed by confrontation including prosecutions launched by the plaintiff against the defendant in the Magistrates Court and now this proceeding. The complaints from residents were apparently made to the defendant who appears to have taken certain action and incurred expense since 1987 in an attempt to abate the noise, but unfortunately not to the apparent satisfaction of some local residents. The plaintiff commenced receiving complaints early in 1988. So also did the Department as appears from the affidavit of Peter Charles Justin Overton, the Senior Environmental Officer of that Department, filed 4th March, 1991. Mr. Overton took noise readings in March 1988 followed by discussions with management of the defendant in March/ April 1988. By letter 19th May 1988 the Department wrote to the defendant recommending maximum noise levels, the same as those which appear in the first column of the schedule to the writ and statement of claim. Further readings on 21st June, 1988 showed that the noise level was no lower than those revealed earlier. On 8th July, 1988, the Department by letter provided to the plaintiff the table of maximum noise levels which are those adopted by the plaintiff as one of the conditions for granting its approval to 0 C) 0 (J -- 9 of 33 -- 1. I~ I. 1. 1. 1. l ll l 1, t 7 the defendant's application for rezoning (see below - and para. 6 of Mr. Overton's affidavit). Soon thereafter the plaintiff approved the defendant's application for rezoning, subject to certain conditions including conditions as to air pollution and noise levels. By letter dated 13th October, 1988, the plaintiff wrote to the Department advising that the rezoning was recently approved by the plaintiff, one of the conditions being maximum levels relating ·~ to air pollution and noise emission. The letter also referred to "significant number of complaints" relating to the foregoing, indicating the fact that it had co-operated with the defendant in granting building approval for sound amelioration measures, and requested the Department to investigate the problem as early as possible with any intended action consequent thereon~ The letter indicated that this matter had been an ongoing source of complaint and was "still ... of grave concern to joining owners". The plaintiff not unreasonably was then content to let the matter be resolved by the Department with appropriate action pursuant to that Department's statutory powers under the Noise Abatement () Act. On 25th October, 1988 (ex. C to the affidavit of John Raymond Smith, town clerk to the plaintiff filed 4th March, 1991), the plaintiff wrote to the defendant after expiry of the objector appeal period, no objector having appealed against the application for rezoning. The letter at p. 5 indicates that there had been some 10 objections to the initial application. The letter in its terms advised that the plaintiff had confirmed its previously deemed decision to support the application to the -- 10 of 33 -- 8 Minister for amendment to the scheme as proposed, subject to the previously nominated conditions as listed in the letter. These included the entry into a binding agreement with the plaintiff before submission of the application for rezoning for ministerial approval. The agreement was to bind the defendant to development conditions including - development in accordance with drawing no. 2496; submission of a cash bond or bank guarantee to secure the performance "of all works external to the subject site", the Q actual amount to be determined by the plaintiff upon preparation of detail estimates of required works; completion of specified road works; provision of ingress and egress to Back Creek Road in accordance with the plaintiff's minimum requirements; provision of a 1.8 metre high solid timber, a.c or concrete fence along Back Creek Road; application to be made to the appropriate authorities to obtain permission to occupy that part of the road 0 reserve over which buildings had been partially erected; a Q condition regarding parking of vehicles in the road reserve; provision of a sealed parking area; maintenance of noise levels measured on FAST response at any affected residence so as not to exceed the levels specified in the letter (being identical with those contained in the writ and statement of claim and as furnished to the plaintiff by Mr. Overton on 8th July 1988) . The following then appeared after condition (i) as to noise levels:- "To achieve these levels, the following measures are to be taken:- ( i) dri-ers and wood chippers are to be acoustically treated Q!: adequately enclosed. (ii) the debarking machine and circular saws are to be adequately enclosed. CJ -- 11 of 33 -- I [ l 1. I. l I. l lt l l I [ with 9 (iii) endloaders on the site are to be modified using high insertion loss modifiers". A further condition required air emission levels to comply the requirements of the Department. Also building approvals were to be obtained for all unauthorised and proposed work with a building application for unauthorised work to be lodged prior to the application being forwarded to the Department on Local Government for Ministerial approval. Compliance with the above conditions necessarily involved the lapse of a considerable period of time, the incurring of considerable expenditure by the defendant, compliance with local authority and (J other statutory requirements and consents, and a degree of co-operation between the plaintiff and the defendant with regard to approvals etc. The letter further advised the defendant of its right of appeal to the Local Government Court against the plaint.:i,.ff' s decision in relation to the conditions nominated in the letter. The letter also acknowledged receipt of a submission on behalf of the defendant by Chris Schamburgk Consul ting Pty. Ltd. seeking Q amendments to the conditions regarding completion of road works and maintenance of noise levels. The letter indicated that these matters were receiving consideration and that the defendant would be advised of the plaintiff's decision at the earliest convenience. The material does not disclose the extent of the plaintiff's consideration of and its decision on those matters or whether and by what means or when its decision (if any) was conveyed to the defendant. It must be taken, however, from what follows, that the plaintiff did not amend or vary the specified noise levels. Further discussions were held between Mr. Overton and the defendant and on 14th November, 1988 the Department wrote again -- 12 of 33 -- 10 to the defendant (ex. B to Mr. Overton' s affidavit), acknowledging that certain noise abatement work had been carried out by the defendant but pointing out that this work was not sufficient or satisfactory for residents during the day. A programme of abatement measures and its timetable was requested by 30th November, 1988, failing which it was pointed out that a reference would be made to the Noise Abatement Authority for consideration under the Noise Abatement Act. By letter 24th November, 1988 (ex. C to Mr. Overton' s affidavit) the defendant wrote to the Department referring to its efforts to satisfy noise complaints from residents. It pointed 0 out that "The company does not have unlimited funds available, () however each month we have spent many dollars in an effort to reduce noise to the very low levels set for our Sawmill." On 25th November, 1988, the defendant appealed to the Local Government Court in respect of certain conditions in the conditional approval letter of 25th October 1988 and in particular in respect of the contribution to roadworks, erection of a 1 .8 metre high fence, and the noise levels, on the grounds () set out in the notice of appeal, ex. D to the affidavit of (J Mr. Smith. follows:- Grounds 9 and 10 dealing with noise levels are as "9. Condition 1(i) is not reasonably required by the rezoning of the subject land having regard to thenature of the surrounding area, the location of the subject land adjacent to a major tourist and local thoroughfare and in close proximity to a railway line, and the ambient background noise levels in the surrounding area. 10. Condition 1(i) ought to be amended by deleting all reference to stipulated noise levels and insubstitution therefore, requiring the appellantto satisfy the requirements of the Noise ,. -- 13 of 33 -- 1. I~ 1. l l I. ll I i: 1 1 Abatement Authority M.A.A. with respect to noise emissions from the subject land." On 2nd December, 1988, the Department replied to the plaintiff's letter of 13th October, 1988, advising that the defendant's response to the Department's request for a programme of abatement measures and the timetable for completion indicated that "sufficient measures are unlikely to be implemented to achieve a satisfactory situation for residents". The letter indicated that the Department would be obliged to refer the matter to the Noise Abatement Authority for consideration under the relevant Act. (,,,-----) On 15th December, 1988 a letter signed by some 57 residents \ .• C) was received by the plaintiff (ex. "A" to the affidavit of John Joseph Hession, the plaintiff's Deputy Town Planner filed 8th March, 1991). That was an objection to the planned rezoning. On 8th February, 1989, the plaintiff applied for and was given a date for hearing of the defendant's appeal to the Local Government Court. On 7th April, 1989, the defendant withdrew its appeal. The reasons for this withdrawal are not stated in the Q evidence before me. In the meantime on 15th and 16th March, 1989, the Department conducted further noise surveys. These again indicated excessive noise levels i.e. that is levels in excess of the maximum specified in the plaintiff's letter of conditional approval dated 25th October, 1988. On 6th May, 1989 a further letter signed by numerous residents was sent to the plaintiff for the attention of the Health Department. It demanded that proceedings be taken against the defendant under s. 86 of the Health Act 1937 (complaint of -- 14 of 33 -- 12 nuisance). The plaintiff after receipt of legal advice did not proceed under that Act. Notwithstanding the foregoing, on 1st June, 1989, the plaintiff and the defendant entered into the deed (ex. "E" to Mr. Smith's affidavit), in accordance with the letter of approval of 25th October, 1988 (ex. "C" to Mr. Smith's affidavit). The conditions in Schedule 2 thereof are the same as those in the letter of 25th October, 1988. Clause 9 of that schedule deals with noise abatement levels in similar terms, and with the same words following the table commencing with the words "To achieve these levels, the following measures are' to be taken". Clause 2 of the deed provides that in the event of the Governor-in-Council approving the application referred to in cl. 1 (for rezoning) the defendant shall "undertake, carry out; provide and do or cause to be undertaken, carried out, provided and done the works and make or pay the payments of contribution set out and specified in the ~econd Schedule which, on its face, includes the abatement measures in order to achieve the maximum noise emissions referred to. Clause 3 of Schedule 2 refers to the provision by the defendant of a bond to secure the defendant's due performance of its obligations under the deed with respect to "payments or contributions required to be made and the works, matters and things required to be undertaken, carried out, provided and done by the applicant as set out and specified in the Second Schedule hereto". Prima facie, this bond covers all works including the noise abatement measures. Yet the bond to be provided in cl. 2 of the Second Schedule is (as is also provided for by the letter 0 0 0 CJ -- 15 of 33 -- ( f, 1. r' I. I 13 of 25th October, 1988), a bond to secure performance of all works external to the site. It is obvious that the noise abatement measures at least are works to be performed on the site and are not external to the site. The above provisions were relied upon by senior counsel for the defendant as imposing a positive obligation on the defendant to undertake and carry out works, i.e. a positive covenant and not merely a negative covenant to abate noise. It was further ) submitted that a substantial issue would have to be tried in due course as to the true construction of the deed when viewed in the proper context of all surrounding circumstances. 0 On 26th June, 1989, the defendant duly lodged with the plaintiff a bond of $90,000.00 in accordance with one of the conditions of approval. On 12th July, 1989 the plaintiff issued a complaint under the Justices Act 1886 as amended (ex. "H" to Mr. Smith's affidavit) alleging a breach by the defendant in about December 1988 of the plaintiff's town planning scheme, cl. 10(5). It was alleged that the defendant executed or carried out certain additions to its premises without obtaining the prior consent of the plaintiff as required by the Town Planning Scheme. These additions included various structures. On 17th August, 1989, the defendant was convicted of the offence at the Caloundra i Magistrates Court and fined $150.00. On 18th September, 1989, the rezoning of the land after approval by the Governor-in-Council was duly gazetted. Thus the rezoning had become law. It was submitted by counsel for the plaintiff that the conditions imposed by the Council by virtue -- 16 of 33 -- 14 of the letter dated 25th October, 1988 and in particular by the deed of 1 st June, 1989, must be taken to be "reasonable and relevant conditions to which the approval of the rezoning was subject". Further noise tests were conducted by the Department on and in the region of the defendant's land and in particular on 3rd April, 1990. On 22nd March, 1990 the plaintiff issued a further complaint (ex. "I" to Mr. Smith's affidavit) alleging inter alia a breach of the conditions of approval to the rezoning in that it stored scrap timber within the road reserve adjoining the land 0 and noise levels generated upon the subject land exceeded those permitted by the Conditions of Approval. On 19th April, 1990, Q the defendant was convicted of the offence in the Caloundra Magistrates Court and fined $200.00. It was said on behalf of the defendant that this prosecution was invalid because it was based on an alleged breach of the deed of 1st June, 1989. The defendant did not appear at that hearing. Counsel for the plaintiff on the other hand drew attention to cl. 5 of Part IV of the Town Plan ( Queensland Government Gazette No. 68, December, 1987) as follows:- " 5. Where in respect of any applications to rezone whether approved by the Council before or after the coming into force of this part and which is approved by the Council subject to reasonable and relevant conditions, any person who ·in any respect fails to comply with any one or more of the conditions imposed by the Council in granting the approval within the time specified or if no time is specified then after the use of the land commences whether in whole or in part shall be guilty of an offence under this Chapter." 19th On 3rd April, 1990, the Department carried out more tests (see ex. "F" to Mr. Overton's affidavit). This resulted in a 0 0 -- 17 of 33 -- n C) 0 j 15 noise abatement notice being issued against the defendant, calling on the defendant to show cause why an order should not be made. On 1st May, 1990 a "show cause" hearing was held by the Noise Abatement Authority and on 23rd July, 1990 a noise abatement order was issued against the defendant (ex. 11 0 11 to Mr. Overton's affidavit of 4th March, 1991), stating that the noise emitted was excessive. The order required the defendant to commission a recognised acoustics consul ting expert and to submit to the Department by 10th August, 1990 a report on identifiable noise sources and available noise control techniques and by that date also a draft timetable for the implementation of noise control measures recommended by the acoustic consultant. On 22nd May, 1990 Mr. Overton inspected the site with the defendant's manager and seven areas were identified which contributed to noise levels. It appears from the minutes dated 13th June, 1990 (ex. "H" to the affidavit of John Joseph Hession sworn 4th March, 1991 - the plaintiff's Deputy Town Planner) that a site inspection was undertaken on 11 th May, 1990 by him and another officer in company with a representative of the defendant. A further site inspection was undertaken on 31st May, 1990 by Mr. Hession, the Building Inspector, the Health Inspector, and two Local Council Aldermen together with the manager of the defendant company. A review of all of the conditions of . the rezoning apparently occurred and these are referred to in those minutes. Certain conditions which had not been complied with were noted. It was noted that noise levels often exceeded the nominated maximum levels imposed and that no acoustic treatment had been undertaken -- 18 of 33 -- 16 on site with regard to the drier and other machines. It was stated that there had not been full compliance with this condition of approval. The recommendation of that meeting was that the proprietor of the defendant should be given the opportunity to show cause why the Council should not proceed with action for the defendant's failure to satisfy the rezoning conditions relating to noise levels and with respect to the alleged unlawful installation of a drier and proposed installation of a second drier in a storage shed not indicated in the original application. The defendant submitted a report from Consulting Structural and Mechanical Engineers, Stewart and Thiris Pty. Ltd. following tests conducted at the site on 30th July, 1990. By letter dated 8th August, 1990 (part of ex. "E" to Mr. Overton's affidavit), that engineer congratulated the defendant for a "very low noise level" which had been achieved. The letter stated that the noise generated was considerably less than that generated by some stockfeed mills, furniture and joinery works and continued:- "From our inspection of the mill noise, generated during operationi and the background noise with mill shut down, a much lesser noise generation is indicated than the figures obtained by the Department of Environment and Heri~age." The letter questioned some of the readings obtained by Mr. Overton but went on to refer to three noise sources about which "something can be done". He referred to the "recommended" limits recognised in the Department's environment guidance leaflet which he said were strictly only guidelines and stated to be "desirable objectives". He did not refer to the levels in fact approved by the plaintiff and which had been incorporated 0 C) C) (j -- 19 of 33 -- 0 17 as conditions of the plaintiff's approval to the rezoning. He concluded that the mill operated within an acceptable level of noise when compared with the noise generated from other mills. It was submitted that this evidence also indicated that there was a substantial issue to be tried namely whether or not there was in fact a nuisance, being the only basis claimed by the plaintiff in the notice of motion. On 8th August, 1990, the defendant wrote to the Council (ex. 11 J 11 to the affidavit of Mr. Hession) enclosing a copy of the above consultant's reports, referring also to money spent over the previous 18 months and giving specific answers to Mr. Hession's letter of 10th July, 1990 to the defendant. The defendant was making some effort to abate the noise and was not ignoring the problem. It appears however that the expertise of this consultant commissioned by the defendant, was not accepted by the plaintiff. On 5th September, 1990 the plaintiff issued two further complaints (exs. "J" and "K" to Mr. Smith's affidavit). The first alleged a breach of the conditions of approval to the rezoning and in particular alleged failures in relation to the erection of a drier, the non-completion of a 1 .8 metre high fence and the non-provision of a sealed car-parking area. Exhibit "K" consisted of an alleged breach of the rezoning conditions in that the noise levels measured at an effected residence exceeded the permissible noise level set out in the said conditions. On 2nd November, 1990, a receiver and manager was appointed to the defendant company by a major creditor, the ANZ Banking Group. On 23rd November, 1990, the solicitors for Mr. Max -- 20 of 33 -- 18 Prentice, the receiver and manager, wrote to the solicitors for the plaintiff seeking a commercial solution to the problem which existed between the plaintiff and the defendant and seeking an adjournment of the hearing of the aforesaid complaints which were due to come before the Magistrate's Court on 28th November, 1990. It appears that the plaintiff's solicitors refused an adjournment and proceeded on 28th November, 1990 when the first of the above two summonses was dismissed with a costs order of $6,500.00 awarded against the plaintiff. Senior counsel for the defendant informed me that the Magistrate had acceded to submissions on behalf of the defendant to the effect that there could be no quasi criminal prosecution for a breach of a deed between the parties, even if a breach had in fact occurred. The noise prosecution summons was adjourned to 10th December, 1990 and subsequently by consent to 4th April, 1991. The Council has appealed to the District Court against the decision of the Magistrates Court on 28th November, 1990 dismissing the complaint. It appears that a conference arranged to be held at the plaintiff's premises on 29th November, 1990 (i.e. the day after the Court hearing) was cancelled. According to submissions of senior counsel for the defendant, this was cancelled by the plaintiff. By letter dated 4th December, 1990 (ex. "B" to the affidavit of Christopher Michael Carbery, solicitor for the receivers filed 12th March, 1991) the receiver's solicitors wrote again to the solicitors for the plaintiff again referring to the fact that the receiver had been only recently appointed and was now in control of the company without a thorough knowledge of the 0 C) C) 0 -- 21 of 33 -- I · '[ I \ I [ I i: I ' 't L I f r 1 J r l n 19 issues but was anxious to obtain that knowledge from the plaintiff. The receiver expressed anxiety in preserving the asset value of the land and business as a going concern and again entreated the plaintiff's solicitors to attempt to arrive at a commercial solution in order to keep the business going. It was stated that the receiver and the ANZ Banking Group were most anxious to ensure that there were no unnecessary retrenchments from the defendant's mill. The letter entreated the Council to reconvene a conference in order that the matter could be amicably discussed. That letter was acknowledged by letter dated 7th December, 1990 from the plaintiff's solicitors which referred to the fact that a meeting was convened on 5th December, 1990. By letter dated 12th December, 1990 (ex. "D" to Mr. Carbery's affidavit), the solicitors for the plaintiff paid $6,500.00 to the solicitors for the defendant and expressed disagreement with some of the () matters referred to in the receiver's solicitors' letter of 4th December, 1990. 0 In the meantime Mr. Overton conducted further noise level tests at or near the site on 3rd April, 1990, 28th September, 1990 and 8th January, 1991. See exs. "F", "G" and "H" to his affidavit. All tests showed readings above the approved limits. His reports also indicate that these tests showed no significant reduction in noise levels and indeed, he said that the tests in September 1990 showed a higher reading than that recorded in his previous tests. In para. 13 of that affidavit, Mr. Overton suggested various measures which could be taken, many of which did not in his opinion require the approval of the plaintiff but -- 22 of 33 -- 20 were matters for the management at the defendant's mill. His recommendations also included the replacement of galvanised iron sheds which contributed to the noise level by reverberant build- up, with an acoustically designed building, but he recognised that this required funding by the defendant, and approval from the plaintiff. Mr. Overton expressed the opinion that from a practical point of view, the noise levels emanating from the mill were greater than twice as loud as that permitted by the approval conditions. He further said that this was a practical consequence to a listener. It appears from the affidavits of Mr. Lovewell and Mrs. Neilson who live close to the mill that noise, dust and other activity caused them annoyance and concern. It appears that the plaintiff proposed to proceed with the roadworks referred to in para. (c) of the rezoning approval and to that end, the plaintiff had previously resolved to draw down on the funds deposited by the defendant by way of the bond on· 26th June, 1989. By his affidavit filed 4th March, 1991, Mr. Hession said that the plaintiff was presently undertaking some of those works. In that affidavit he referred to what he termed "various breaches" by the defendant of rezoning conditions. On 5th March, 1991 Mr. Overton took further readings of noise emanating from the defendant's mill in the garden of the residence of Mr. Lovewell. This recorded a reading well in excess of tlle maximum specified levels. On 5th March, 1991 he, in the company of Mr. Hession, and the manager of the mill inspected the mill. The manager indicated to them three items 0 0 () (j -- 23 of 33 -- f 21 of work undertaken by the defendant to implement the recommendation of Stewart & Thiris Pty. Ltd. which Mr. Overton described as minor. Mr. Overton said that noise levels from the mill had not reduced significantly since the measurements taken in September 1990. On 7 th March, 1 9 91 , Mr. Overton took a further reading from Mr. Lovewell's premises at 8.13 a.m. which showed a reading of 72.1 LA.Max Adj. 15 min. David Spence Irvine, company secretary and internal accountant for the defendant swore an affidavit filed 12th March, 1991 on behalf of the defendant. He referred to expenditure incurred by the defendant since October 1987 on noise abatement. r' 1 \_~) He said that in September 1990 the defendant had submitted plans C) to the plaintiff for approval of construction of a building to enclose the southern-most chipper as well as to erect a roof over the debarker and lining for the drier shed. He swore that the defendant was still awaiting approval from the plaintiff before being able to carry out the major part of this work. He said that the defendant had on 6th March, 1991 given instructions to a firm of engineers to prepare plans for the erection of a 50 Q metre long, four metre high solid fill wall along the western side of the plant building thereby enclosing the debarker, saw mill and veneer mill and providing for openings for the feeding of logs into the plant with rubber screens over these openings. Mr. Irvine also said that on a number of occasions since February 1991 he had personally performed sound tests or had caused the mine manager to carry out noise emission tests. He referred to a list of noise levels which in general did not exceed the maximum contained in the conditions of approval for the rezoning. -- 24 of 33 -- 22 It was submitted that this was a further basis for ordering a trial of the action because such disputed questions of fact could not be determined on an interlocutory application. On or about 10th January 1991, Barry William Sands, Consulting Engineer, was retained by the receiver and manager of the defendant to report on the feasibility of reducing noise levels. Mr. Sands knew of the site, having travelled that road which was the Old Bruce Highway on numerous occasions during the past 30 years. He formed the view that the noise levels caused Qby traffic alone in that area before the new Caloundra by-pass was built so that all of the constant heavy traffic then flowed past the mill, was about 67-75 db, i.e. well above the noise limits now permitted by the conditions of approval, and quite apart from the noise generated by the mill. Mr. Sands conducted several inspections in January and stated that all of the houses situated adjacent to the highway and near the mill would have been affected by heavy traffic volumes and noises before the construction of the by-pass so that from a practical point of view, the opening of the Caloundra by-pass had the unfortunate effect that local residents then noticed the major remaining noise which they had not particularly observed previously. He concluded by saying that he doubted whether the combined level of road and mill and background noise at present is any greater than it was in previous years when the road was then the main highway. Nevertheless, Mr. Sands said that it was possible to undertake various works required by the plaintiff and that such works would probably effect a reduction of noise levels. He said 0 0 0 -- 25 of 33 -- r r. n 0 23 that the main inhibiting factors and constraints were the question of costs and the co-operation of the plaintiff in approval of building plans. He also said that his tests and inspections were substantially in agreement with those of Mr. Overton with some areas of divergence which he set out. He said that since Mr. Overton' s inspection the chains of the debarking machine had been tightened and the machine was now running much more quietly so that the machine may not in fact need enclosure as provided for in the conditions of rezoning. From this it was argued on behalf of the defendant that at least one of the conditions set out in the conditions of approval was no longer necessary as noise abatement was achieved by a different process. Whilst not commenting on Mr. Overton's "permitted level" which resulted in Mr. Overton's view that to the average listener sounds emanated were more than twice as loud as the permitted level, Mr. Sands agreed that the levels recorded would be regarded by an average listener as excessively noisy, although no noisier than was the position when the highway was in fact the main North Coast U highway before the Caloundra by-pass was constructed. It appears from the affidavit of Peter Kenneth Lowcock (employee in the firm of Prentice Parbery and Briller, Chartered Accountants, who are engaged on behalf of the receiver) filed 12th March, 1981, that the plaintiff was asked to advise when it intended to commence roadworks and he sought an accounting of how the $90,000.00 bond which the plaintiff proposed to use would be spent. The plaintiff's reply on 15th February, 1991 was to the effect that as the guarantee was unconditional, it would "be -- 26 of 33 -- 24 spent how Council sees fit". Mr. Lowcock contacted the plaintiff expressing concern at this response but. was told "that's the only explanation the Council's going to give you". Graham Max Squire, Queensland Manager of the firm of Chartered Accountants acting for the receiver and manager swore an affidavit filed 12th March, 1991 referring to his involvement and that of the receiver since his appointment. He endeavoured to arrange conferences with the plaintiff, one of which was held on 5th December, 1990 at the plaintiff's premises. Present was the Mayor, Mr. Smith, Mr. Hession and four other City Aldermen representing the ward. He said that the Mayor informed him that the plaintiff insisted that the noise level be in conformity with the schedule of the rezoning agreement. On 7th December, 1990 Mr. Squire wrote to the plaintiff expressing the desire of the receiver and manager to carry out works to minimise the excessive noise as much as is practicable and that it intended to obtain a further report from an acoustics engineer. He sought assistance from the Council as to names of suitable engineers but as no advice was forthcoming, he engaged Mr. Sands. On 21st January, 1991, Mr. Squire and Mr. Lowcock attended a further meeting at the .plaintiff's chambers. They were advised that the plaintiff proposed to seek an injunction and asked what were the receiver's plans for rectifying the noise problem. Mr. Squire advised that Mr. Sands had been engaged and the Town Clerk said that the plaintiff required an immediate curtailment of operating hours to 7.00 a.m. to 6.00 p.m. with the drier and fans to be shut down at 6.00 p.m. A reply to that request was to be given within 24 hours. On 22nd January, 1991, Mr. Squire wrote 0 C) CJ -- 27 of 33 -- 25 to the plaintiff undertaking to curtail the operating hours as requested by the plaintiff whilst reserving the right to review these hours when the noise being emitted by the mill is within the acceptable level specified by the Department of Environment and Heritage (ex. "A" to Mr. Squire's affidavit). Following a letter from the plaintiff on 25th January, 1991, Mr. Squire sent a report to the Council which addressed noise attenuation proposals in two stages. He confirmed that the n operating hours were restricted to 7.30 a.m. to 6.00 p.m. Monday to Friday only and that it was the receiver's intention to pursue n " ,, (J the rectification of the rezoning breaches in the most practical manner and to make all reasonable efforts to meet Council requirements. He invited the plaintiff's officers to contact him at any time should further information be required. Having no response to the lastmentioned report, Mr. Squire made attempts through staff to contact Mr. Hession and Mr. Smith but both were unavailable. The only information available was that an injunction was to be sought by the plaintiff. He expressed concern at the response to Mr. Lowcock's letter requesting an accounting by the Council as to how it would expend the $90,000.00 bond provided by the defendant. He again asked for co-operation and sought a resolution by negotiation. Mr. Squire referred to difficulties in complying with all rezoning requirements and in particular, the defendant had made application to the Land Administration Commission for the purchase of adjoining Crown land and that the Land Administration Commission had proposed certain pre-conditions. This required a bond of $8,400.00 with regard to mains water supply and certain -- 28 of 33 -- 26 other departmental requirements including those of Telecom Australia and the Department of Transport regarding access. He indicated that the receiver would need to take a commercial decision in relation to the viability of acquiring adjacent Crown land having regard to the cost of complying with the Department of Transport' s requirements. He said that he was unable to ascertain the costs of satisfying the Department of Transport's requirements because of the plaintiff's continual refusal to give details of engineering works commenced by the Council on or about 15th February, 1991 without his knowledge or to account to him for the sum of $90,000.00 bond money confiscated by the plaintiff. Since the appointment of the receiver, the defendant has traded at a loss. The receiver must consider the interests of creditors and particularly those of the major secured creditor, the ANZ Banking Group. He must fully investigate all options with respect to the marketing for sale of the assets of the company including the marketing of the entire land administered as a going concern. It is obvious that the receiver needed to obtain full information and has acted promptly in an endeavour to do so. One option to be considered was whether or not the entire plant should be closed down and the assets sold piecemeal at a substantially lower figure than if the operation was sold as a going concern. He said that if an injunction was sought the receiver would have no choice but to close the mill down immediately. Peter Kenneth Lowcock, accountant employed by the receivers, by affidavit filed 12th March, 1991, said that the defendant 0 C) C) C) -- 29 of 33 -- n (~) 27 employed 23 full-time permanent employees and a further 11 employees on a casual basis but who are engaged full-time. Approximately $800,000.00 per annum is paid to local contractors and approximately $748,000.00 in wages annually. He was informed by the Caloundra branch of the Commonwealth Employment Service that the Caloundra and Sunshine Coast areas rank amongst the highest areas of unemployment in Australia and that it would be extremely difficult to find employment for an additional 34 men should they be put out of work. Eleven of the employees are single without dependents and the balance of employees have a total of 45 dependents. The company pays approximately $720,000.00 per annum to C.S.R. for the supply of raw materials of which approximately $300,000.00 is paid to local contractors by C.S.R. It was submitted by senior counsel for the defendant that if the defendant were to be forced to close down, it would involve not only the unemployment problem referred to but a (J withdrawal of approximately $2,000,000.00 per annum from the local community at Beerwah with substantial economic effects to that small community. 0 There can be little doubt that the receiver and manager since his appointment on 2nd November, 1990, has acted in a reasonable manner in endeavouring to ascertain all details applicable to the problem and in endeavouring to meet the plaintiff's requirements with a view to resolving the dispute in a commercial manner without litigation. On the other hand, there has been noticeable noise emanating from the defendant's land at least since the new Caloundra by-pass was opened, and this noise, according to the evidence of some deponents to affidavits, -- 30 of 33 -- 28 exceeds the limits specified in the conditions of approval although there is some evidence to the contrary. It must also be recognised that the plaintiff has a public duty to perform in ensuring that its conditions of approval are not broken. It has a duty to represent the interests of the whole community and it has endeavoured to do so as it saw fit. The circumstances under which an injunction is granted are well-known. The remedy )is discretionary in nature. The first requirement is that there must be a substantial question to be tried in the action between the parties. If this condition is satisfied, as it clearly is in this case, then the balance of convenience must be considered, i.e. the position not only with regard to both plaintiff and the defendant pending trial, but also to the positions of affected third parties: Clarke v. Japan Machines (Australia) Pty. Ltd. [1984] 1 Qd. R. 404 per Thomas J. at 419. For the purposes submissions of senior of this application, I accept counsel for the defendant that the the plaintiff's claim is based only on nuisance, with no claim based upon an alleged breach of the by-laws or of the deed. The notice of motion is based only on common law nuisance even though a breach of conditions contained in the deed or of conditions of approval may provide some evidence that a nuisance otherwise in fact exists. Notwithstanding that this point was taken during the proceedings by senior counsel for the defendant, no application was made on behalf of the plaintiff to amend the notice of motion. C) C) C) C) -- 31 of 33 -- (;' / 29 I also accept the submissions of senior counsel for the defendant that if this claim is in fact based upon a breach of the deed, there is a question to be determined as to the true meaning and effect of the nature of the covenant referred to therein. This document must be construed in the light of all the surrounding circumstances and it is not convenient to construe this document on an interlocutory application in the Practice Court. Furthermore, notwithstanding the opinions expressed by Mr. Overton, there is some dispute as to the actual noise levels and their causes and as to the extent to which the defendant has complied with the plaintiff's requirements either by performance of any necessary work or whether or not some of the requirements are no longer necessary by reason of alternative action taken. It is not necessary for the purposes of this application to go into the disputed question of whether or not the defendant is () still awaiting for approvals from the plaintiff in order to [) undertake certain work. Nor is it the Court's function on an interlocutory application to finally resolve other disputed areas - . of fact. This must be left for trial. Having regard to the defendant's financial situation, it may be wondered whether the defendant will in fact · be able to undertake this work without the infusion of further funds which the receiver indicated that he might seek once he is in possession of all information. Alternatively, there is a real possibility, as appears from the evidence, that a decision may very soon be made to shut the mill down completely in any event. -- 32 of 33 -- 30 If this occurs, then the noise problem will disappear without the need for protracted and costly litigation. Having carefully considered all of the material in detail and all of the submissions and arguments before me, as well as the number of years during which this dispute has continued, it seems to me that on balance, the injunction sought should now be declined and the matter allowed to go to trial as speedily as possible. Relatively speaking, the further delay should not be considerable. Accordingly, the application is dismissed. Costs of and incidental to the motion are reserved. The action is certified as one which should be tried speedily. ' . C) 0 C). -- 33 of 33 --