|
|
[Home]
[Databases]
[WorldLII]
[Search]
[Feedback]
Environment Resources and Development Court of South Australia Decisions |
Last Updated: 8 February 1999
Judgment of His Honour Judge Bowering
Respondent IAN P & PATIENCE J BAILEY:
Counsel: MR S HENRY - Solicitors: FINLAYSONS
Respondent MT LOFTY HOLDINGS PTY LTD T/AS MOUNT LOFTY SPRINGS:
Counsel: MR S HENRY - Solicitors: FINLAYSONS
ERD-97-348
Judgment No. OE3
15 January 1999
STIRLING DISTRICT ENVIRONMENT ASSOCIATION INC.
v
IAN A & PATIENCE J BAILEY
and
MT LOFTY HOLDINGS PTY LTD t/as MOUNT LOFTY SPRINGS
[1999] SAERDC No.348 of 1997 OE3
JUDGEMENT OF HIS HONOUR JUDGE BOWERING
1 The Stirling District Environment Association Inc is an association incorporated under the Associations Incorporation Act, 1985. It has approximately 100 to 120 members. Speaking generally, the objects and purposes of the Association are to protect the environment and built heritage of what used to be the district of the District Council of Stirling in a variety of ways.
2 By application dated 18th November, 1997, the Association applied to this Court for leave to serve a summons pursuant to Section 85 of the Development Act, 1993. The application was amended on 2nd December, 1997 and leave to serve the summons was granted on the amended application. The summons was duly issued on 9th December, 1997, and served on the respondent on that day. The respondents to the summons are Mr Ian Bailey, Mrs Patience Bailey and Mt Lofty Holdings Pty Ltd, trading as "Mt Lofty Springs".
3 Mt Lofty Springs conducts the business of the extraction, storage and packaging of spring water on land situated at 41 and 61 Sprigg Road, Picadilly. The Association alleges, in its summons, that Mt Lofty Springs is conducting the business in a way which constitutes a breach or breaches of the Development Act. There are two principal allegations in the summons, namely, that part of the business is being conducted on land with respect to which no planning approval has ever issued and, secondly, that in so far as the business is being conducted on land with respect to which a planning approval has issued (and in particular, a planning approval issued in 1992) the business is not being conducted in accordance with the terms of that approval. Mt Lofty Springs has entered an appearance to the summons and present indications are that the allegations contained in the summons will be contested. The action is set for trial for five days commencing on 8th March, 1999.
4 The terms of subsections 85(15) and (16) of the Development Act are as follows:-
(15) The Court may order an applicant in proceedings under this section -
(a) to provide security for the payment of costs that may be awarded against the applicant if the application is subsequently dismissed;
(b) to give an undertaking as to the payment of any amount that may be awarded against the applicant under subsection (16).
(16) If on an application under this section the Court is satisfied -
(a) that the respondent has not breached this Act or a repealed Act; and
(b) that the respondent has suffered loss or damage as a result of the actions of the applicant; and
(c) that in the circumstances it is appropriate to make an order under this provision,
the Court may, on the application of the respondent (and in addition to any order as to costs), require the applicant to pay to the respondent an amount, determined by the court, to compensate the respondent for the loss or damage which the respondent has suffered."
5 Mt Lofty Springs has applied for an order that the Association provide security for the payment of costs that may be awarded against it if its action is dismissed. In support of the application, Mr Henry, for Mt Lofty Springs put to me that the assets of the Association are unlikely to be sufficient to meet any order for costs which is likely to be made in the respondents' favour should such an order be made pursuant to subsection 85(16). This means, he said, that should Mt Lofty Springs win the case, it would not be able to recover its proper costs, a situation which he described as unfair. He expects his clients' costs to be in the vicinity of $15,000-$18,000, but is prepared to accept security for $12,000. This figure is based on the fact that the Association has approximately 120 members, and Mr Henry's view that it would not be appropriate for the Association to ask each member to contribute $100 to a costs fund.
6 The Association admits that it does not have the assets to meet an order for costs in the vicinity of $15,000-$18,000. Such assets as it has available to meet an order for costs are below - well below - that figure. The President of the Association, Mr Murray, expressed the view that, if the Association made a call to each member for a contribution of $100 to a "fighting fund" it is unlikely that such call would be heeded by a significant number of members. He opposed any order for security for costs, principally on the ground that the Association would not be able to provide such security and that the practical effect of such an order would be to force the Association to withdraw its action.
7 It is well recognized that the decision whether security for costs should be ordered in particular proceedings calls for the exercise of a wide discretion. The proper exercise of that discretion calls for a careful examination of all of the relevant circumstances. In this case, such circumstances have a fairly lengthy history which includes other proceedings between the parties. The first set of such proceedings was a "third party" planning appeal in which Mr and Mrs John Thornton and the Association appealed a decision of the District Council of Stirling to grant provisional development plan consent to Mr and Mrs Bailey, which consent, given on 12th December, 1996, authorized a variation of a development approval granted by the Council in 1992, which approval related to an expansion of the water bottling business then established on the land at 61 Sprigg Road, Picadilly. In the course of that appeal, both Mr and Mrs Thornton and the Association sought to challenge the legality of the business. As part of that appeal, the Court reviewed some of the history of the business and came to the conclusion that several planning approvals (including building) pursuant to which it had been established were open to challenge. The Court also concluded that the appeal proceedings then in train were not the appropriate proceedings to properly challenge the validity of either the approvals which had been issued or any development purportedly undertaken pursuant to them - see J & J Thornton and Stirling District Environment Association v District Council of Stirling and I & J Bailey (1997) 4 EDLR 175. Having delivered its judgement on 15th April, 1997, the Court adjourned the appeal proceedings to give, to the appellants, an opportunity to consider their position.
8 As a consequence, the Association commenced civil enforcement proceedings against Mr & Mrs Bailey pursuant to Section 85 of the Development Act. However, it did so without the consent of the Attorney-General, which consent is required pursuant to subsection 85(18) of that Act if the offences alleged in the proceedings occurred or included offences which occurred more than three years prior to the commencement of the proceedings. The application for leave to serve the summons came before His Honour Chief Judge Brebner in this Court in August, 1997. His Honour dismissed the application, principally on two grounds, namely that the 1992 approval granted by the Development Assessment Commission was voidable rather than void and that thus it could not be said that Mt Lofty Springs was in breach of the Development Act and, secondly, given that some of the alleged breaches related to events which had occurred more than three years prior to the institution of the proceedings, the commencement of the proceedings was not lawful.
9 His Honour's judgement was delivered on 25th August, 1997: see Stirling District Environment Association Inc. v Bailey & Ors (1997) 4 EDLR 548.
10 The Association tried again. It commenced the current proceedings. When considering whether, in these proceedings, an order for security for costs should be made, I have regard to the history of the dispute between the parties as set out in the judgements in the earlier proceedings between the parties.
11 As Mitchell J stated in the matter of John Arnold's Surf Shop Pty Limited (in Liquidation) v Heller Factors Pty Limited and Allert (1979) 22 SASR 20 at page 34, to approach the question of whether an order for security of costs should be made:
"..... with a pre-disposition to make an order for security for costs would be to fetter the discretion which the legislation has left unfettered. It would be, as it seems to me, equally wrong to exercise the discretion in favour of making an order merely because the section enables such an order to be made as it would be to refuse an order merely because the company is impecunious."
12 In the earlier case of Sir Lindsay Parkinson & Co Limited v Triplan Limited [1973] QB 609, Lord Denning, whilst emphasizing the unfettered nature of the discretion, referred, at page 626, at some of the matters which might properly be taken into account when the discretion is exercised. Several of those matters (eg, such as whether money has been paid into Court) are not relevant to these proceedings. Others are. His Lordship referred to the question of whether the claim or defence raised by the party from which security is sought is bona fide, and whether the application for security is being used oppressively - so as to stifle a genuine claim. In the matter before me (and without expressing any view on the merits) I am satisfied that the Association's case is bona fide and I take that into account. Furthermore, although the history of this dispute (including the earlier proceedings) may constitute a basis for the view that one of the grounds for the application for security may be to oppress the Association's case, I have not assumed this to be so and have not taken any possibility of deliberate oppression into account. Be that as it may, the simple fact is that an order for security will probably stifle the Association's case.
13 The question of whether a party's case should be stifled by an order for security was a matter considered as relevant by Bollen J in Spiel v Commodity Brokers Pty Limited (1983) 35 SASR 294. His Honour commenced by examining the width of the discretion - he said, at page 300, that:-
"The discretion is a wide one. The judge or magistrate asked to order security for costs should not approach the application with any pre-disposition at all. I think it follows that in the circumstances in which the discretion should be exercised in favour of making an order cannot be stated exhaustively. Nor should there be any attempt to do so. The judge or magistrate must decide according to his view of the justice of the case. There should be no complaint at the imprecision of that statement. Beyond saying that the judge or magistrate must behave judicially one cannot define or delimit or categorize the circumstances in which security should be ordered to be given. It is quite another thing to speak of some matters which are capable of assuming importance in an application for security."
14 In that case the Full Court upheld a refusal by a magistrate to order security for costs in a civil action commenced by a company in liquidation. Bollen J, who wrote the principal judgement of the Court, refused to accept that the insolvent company had no reasonable chance of success - he concluded that each side had an arguable case. He noted also that, if security had been ordered, the company would be in no position to provide it with the consequence that the other party would have gained a victory without a contest. He noted that this could cause hardship to the company's creditors. At page 301, His Honour put it this way:-
".....The fact was that such an order would have produced a victory for the appellant without a contest. The respondent would have been prevented from proceeding with an arguable case legitimately instituted. The hardship to creditors produced by such a course would, in my opinion, far outweigh the hardship, which possibly inability to recover costs may cause the appellant."
15 Having noted that the liquidator was an officer of the Court and thus stood in a special position, His Honour concluded his judgement, at page 302, thus:-
"In my opinion, it would be unjust and inequitable to impose on the respondent the burden of providing security for the appellant's costs. I think that the easy victory which an order for security would produce would cause greater hardship than would the possibility that the appellant will not be able to collect costs ordered in his favour."
16 Although I do not, for one moment, equate the members of the Stirling District Environment Association with the shareholders of the company in liquidation in the Spiel case, the comments of Bollen J are not without relevance to the question now before me. Given the paucity of the Association's assets, the prospective hardship to the respondent in gaining an order for costs which cannot be satisfied is a matter of significance which I weigh in the balance. However, the fact that I granted leave to the Association to serve the summons which gave rise to these proceedings means that I am satisfied that the Association has made out a case to answer against the respondent. Nothing which has occurred since I gave such leave has changed that view. Were I to order the Association to provide security for costs, such order would produce a victory for Mt Lofty Springs without a contest.
17 The business conducted by Mt Lofty Springs is a business (or industry) of some substance. It involves the transport of packaged water on heavy vehicles. The facts suggest that such vehicles are having an impact upon at least some of the residents of Sprigg Road. The industry so established has, at all relevant times, been prescribed as "prohibited" - now termed "non-complying" - by the relevant provisions of the Development Plan. The matter discloses that the current use of the land has been established pursuant to several planning approvals which either did not justify the commencement of such a business or the validity of which is open to question (although perhaps now no longer open to legal challenge) and the current proceedings allege what is in effect a continuation of such a situation, namely an extension of the business on the land at 61 Sprigg Road in a manner contrary to the approval granted in 1992 and the use of the land at 41 Sprigg Road without any approval. In my view, these allegations are serious and I do not think that Mt Lofty Springs should gain a victory without a contest, particularly in view of the history of the matter. Given that neither the Development Assessment Commission nor the Council - the responsible planning authorities - are willing to test the legality of the actions of Mount Lofty Springs, and given that the Association has made out a case to answer, I am of the opinion that the interests of justice will be served if this action is permitted to proceed to trial. It is an action which I think should go to trial. In the circumstances I do not believe it appropriate that I should make an order the likely consequence of which would be to preclude the trial of the action.
18 Although I am conscious of the justifiable concerns expressed by Mr Henry on behalf of Mt Lofty Springs, I have come to the conclusion that this is not an appropriate case in which security for costs should be ordered. The application for security for costs is therefore dismissed.
AustLII:
Copyright Policy
|
Disclaimers
|
Privacy Policy
|
Feedback
URL: http://www.austlii.edu.au/au/cases/sa/SAERDC/1999/3.html