Council pays the price for taking enforcement action against the wrong party

Background

Gold Coast City Council (Council) issued an enforcement notice to the owner of a lot in a community title scheme (CTS).  The lot adjoins a buffer area, which is common property of the CTS (the Buffer Area), and borders Saltwater Creek in Helensvale.  Pursuant to the community management statement for the CTS, the lot owner has exclusive use rights for the part of the common property comprising the buffer area.

It was alleged by Council that the owner of the lot had committed a development offence by erecting fencing and play equipment in the buffer area contrary to the development approval that created the CTS.

The Buffer Area was subject to a registerable planning covenant and a coastal management program for the buffer to Saltwater Creek.

The conditions of the original subdivision approval required the then applicant to comply with the relevant registrable planning covenant and the coastal management program for the buffer to Saltwater Creek, which effectively prohibited the erection of buildings and structures in the Buffer Area.

The lot owner filed an appeal in the Planning and Environment Court against the Council’s enforcement notice, alleging (amongst other matters) that she could not be shown to have committed a development offence as the conditions of the original subdivision approval did not attach to her lot but rather the land the subject of the Buffer Area (which was common property).

The Council and the lot owner engaged in correspondence for some months after the filing of the appeal which eventually resulted in the Council withdrawing the enforcement notice.

The issue in the proceedings then became a matter of costs.

Costs argument

The lot owner argued that in the context of the appeal against the Council’s enforcement notice, costs should be awarded against Council for the following reasons:

• the appeal was conducted for an improper purpose in that there had been an improper delay by the Council in the conduct of the proceedings;
• the appeal was frivolous or vexatious, by virtue of the Council’s continued resistance of the appeal on assertions which were groundless;
• the Council sought to introduce new material;
• there had been a default in the Planning and Environment Court’s procedural requirements; and
• there is an obligation on the Council to properly assess the merits of the appeal and acknowledge and address its shortcomings.

The Council argued against costs being ordered for the following reasons:

• the proper purpose of a local government is the enforcement of planning laws within its local government area and that the failure to progress the appeal by filing for directions at an earlier time did not amount to an improper purpose;
• Council did not file a proper response to the grounds set out in the owner’s notice of appeal, as the matter was summarily terminated;
• no new material was introduced as Council was simply engaging in the argument that the enforcement notice was inappropriate or wrong;
• there was no identifiable loss or prejudice to the owner from the perceived delay in making an application for directions to progress the appeal;
• the enforcement notice was withdrawn before the first Court appearance and the lot owner was not required to file any evidence in support of her case or to otherwise take any further substantive steps in the proceedings;
• there is no reported Planning and Environment Court decision which has ordered costs in a similar situation; and
• ordering costs in the circumstances of this case could have the unintended consequent of deterring the early resolution of matters.

The Law

Costs are confined to sections 59 and 60 of the Planning and Environment Court Act 2016 (PEC Act).  While the default position is that each party bear its own costs, this may be varied in one or more of the scenarios contemplated in section 60.

Decision

In Favero v Council of the City of Gold Coast [2019] QPEC 61, His Honour Judge Kent QC, DCJ held that the lot owner could not be shown by Council to have been the proper respondent to the enforcement action taken by Council.  It was also observed that the appeal had proceeded at a leisurely pace since it was filed by the owner.

Overall, His Honour could not accept that on the evidence that the proceeding was started or conducted primarily for an improper purpose, including, for example, to delay or obstruct (section 60(1)(a) of the PEC Act).

However, in respect of whether the proceedings were frivolous or vexatious (section 60(1)(b)) of the PEC Act, His Honour Held at para [41] that:

“… the enforcement notice and the initial resistance to the appeal are within the category of “frivolous and vexatious” in circumstances where the basic flaw in the notice, apparently fatal to its prospects, should have been known to, or ascertained by, the respondent before giving it. In all the circumstances the application for costs is allowed. The respondent will pay the appellant’s costs of the appeal including this application on the standard basis.”

 The costs application against Council was allowed.

Conclusion

This decision highlights the importance of ensuring that enforcement action for alleged development offences is only taken against the proper party and that costs can be awarded against the enforcement authority if action is taken against the wrong person.

For recipients of an enforcement notice, it pays to check the basis on which the enforcement notice has been issued.  Although each case will turn on its own facts and circumstances, recipients of an enforcement notice should not accept at face value the basis upon which an authority has initiated enforcement proceedings.

Equally, enforcement authorities need to carefully identify the person responsible for an alleged offence and ensure that action is only taken against a proper respondent.

The Court has demonstrated that it will order costs against a council if it resists an appeal where a flaw in an enforcement notice could be fatal to its prospects, despite early resolution.

Authored by:

Stafford Hopewell, Partner
Sarah Day, Associate