Mudie v Gainriver Pty Ltd[2002] QCA 546

SUPREME COURT OF QUEENSLAND

[1]  McMURDO P and ATKINSON J:  On 31 January 2002 the Planning and Environment Court dismissed the appellant's application for costs under s 7.6(1A) Local Government (Planning and Environment) Act 1990 (Qld) ("the Act").  The appellant claims the learned primary judge erred in law in his interpretation of s 7.6(1A)(a) of the Act.  She appeals under s 7.4(3) of the Act, which remains apposite despite the introduction of the Integrated Planning Act 1997 (Qld) ("the IPA").[1]

The history of the litigation

[2] The contest between the parties has been long in duration and hard fought.  The first respondent, Gainriver Pty Ltd ("the developer"), applied to the Gatton Shire Council ("the Council") in May 1994 to subdivide its land into eight allotments.  The land neighboured the appellant's property, separated only by a dedicated but unconstructed public road ("the public road").  Both properties had frontages to and access from Flagstone Creek Road, a sealed road which ultimately leads to Toowoomba. 

[3] The Council approved the subdivision on 21 December 1994 subject to a number of conditions, including the construction of a bitumen sealed internal access road ("the access road") to include adequate drainage, sealed passing areas, appropriate erosion control and slope stability measures in accordance with the Queensland Streets Design Manual.  The intersection of the access road with Flagstone Creek Road was to be designed and constructed to the Council's satisfaction and in accordance with the Council's design standards.  A further condition[2] included the provision to the Council of a geotechnical investigation into the potential for slope instability and the suitability of the form of development proposed with emphasis on matters including the internal road and its intersection with Flagstone Creek Road.  The Council indicated its preference for subdivision by way of group title including creation of common property and a body corporate. 

[4] In January 1995, the developer's consulting civil engineer, Mr Kehoe, determined that it was not geotechnically sound to widen the track for the access road.  He looked for alternatives and decided the best solution was to construct the access road on the public road.  Although unformed and untraffickable and with a small dam on it at one section near the appellant's property, members of the public and neighbouring land owners have a right of access to the public road which leads to Flagstone Creek Road.  The Chief Executive Officer and General Manager of the Council, Mr Schumacher, was satisfied with Mr Kehoe's civil design drawings on 1 November 1995 but the change to the location of the road was not considered by the Council.  This change favoured the developer because it removed 100 metres of access road from its northern lots and placed it on the public road, making the approved easements unnecessary.

[5] The access road was constructed in early 1996.  An officer of the developer became alarmed at the steepness of the track for the access road and without consulting the engineer, Mr Kehoe, directed the road be cut in a different position in an attempt to flatten out the steepest parts.  There were a number of difficulties with the access road but the major problem was its steepness with a grade measured over 15 metres of up to 29 per cent, well exceeding the absolute maximum of 20 per cent provided for as standard in the Queensland Streets Manual.  The road was constructed on a level higher than both the public road and the appellant's land, affecting her access to the public road and through it to Flagstone Creek Road.

[6] During construction, the developer erected boulder walls, (for landscaping not structural purposes), without any proper effort to ensure their safety and security and without discussion with the Council.  The boulders were laid against the soil of the slope without any preparatory work, drainage system or foundations and were dangerous.  On one occasion, a boulder belonging to the developer rolled through the appellant's boundary fence and broke the wall of a horse shed.  A young woman riding a horse escaped injury but a mare in foal later miscarried.  The appellant approached the developer's officer, Mr Nikden, who spoke to her in insulting language and ordered her off his land.[3]

[7] In the second half of 1996, the Council approved the erection of a licensed gate at the top of the access road (constructed at this point on the public road) where it joins Flagstone Creek Road.  Although the appellant agreed to a licensed gate, she required that it be electronically operated whilst the developer preferred a manual catch.  Manual operation was difficult because it necessitated parking and leaving a vehicle on a steep slope whilst operating the gate.  The Council officers were keen to see approval given for the changed access road, which was then almost entirely constructed and completed.[4]

[8] Meanwhile, on 9 May 1995, the developer forwarded to the Council its surveyors' sketch plan showing a proposed group title subdivision of the land into eight lots with a common area under the Building Units and Group Titles Act 1980 (Qld).  On 3 October 1996 the developer applied under that Act for a group title subdivision in accordance with a plan which differed in material respects from the plan earlier forwarded to the Council.  The access road commenced, not from the Flagstone Creek Road boundary in accordance with the Council plans, but from the subdivisional land's boundary with the public road near its intersection with Flagstone Creek Road, and near an entrance from the public road to the appellant's property.   

[9] On 16 October 1996 the Council approved the developer's application under the Building Units and Group Titles Act 1980 (Qld), subject to conditions which included that the road be bitumen sealed and adequately drained, sealed passing areas and appropriate erosion control and stability measures.  That approval superseded the earlier approval under the Act.

[10]  The appellant was understandably aggrieved.  She made some efforts to resolve the matter with the developer and the Council but finally applied on 9 April 1997 to the Planning and Environment Court for an injunction against the developer and the Council and a declaration to have the road removed.[5]  The appellant also contended that the respondents had committed offences against the Act.[6]  On 23 April 1997, the court gave directions for discovery, the exchange of reports and to confer to give consideration for resolution of any issues.

[11]  On 13 May 1997 the Council's CEO and Mayor issued a certificate certifying that the proposed subdivision was approved by the Gatton Shire Council and that all requirements of the Act as modified by the Building Units and Group Titles Act 1980 (Qld) were met.  The developer's engineer had not certified that the works were completed in accordance with the plans and specifications approved by the Council.  An essential requirement under the planning scheme was therefore absent and the certificate of 13 May 1997 was invalid and ineffective.  The Registrar of Titles acted upon an invalid document in registering the group titles plan.[7] 

[12]  The matter was mentioned in the Planning and Environment Court in June and July.  The respondents contended in an interlocutory application that the appellant did not have jurisdiction to bring her application and faced an impossible task in proving the commission of any offences under the Act.  Those contentions were heard by the learned primary judge in August 1997 over parts of two days.[8]  His Honour observed that because of the factual disputes it was "really not possible or appropriate to attempt to sort out the matter definitively on any application of this kind";[9] nor was his Honour persuaded that it was impossible for the appellant to demonstrate a breach of the planning scheme.  In dismissing the respondents' interlocutory application, his Honour observed:

"… it is impossible at this stage of proceedings to say with confidence that what [the appellant] is attempting to do lies outside the jurisdiction of this court."[10]

On 19 September 1997, his Honour ordered the appellant have leave to proceed to hearing on the declarations sought and as further identified in the particulars provided to the court on 20 August 1997; the costs of this application were reserved.

[13]  The appellant's substantive case was heard in the Planning and Environment Court over six days from November 1997 to February 1998.[11]  The primary judge found the following.  The Planning and Environment Court had jurisdiction to decide the matters in dispute between the parties.[12]  The Council approval of 21 December 1994 required the access road to be on the developer's land.  The amended plans placing the access road on the public road were not approved by the Council and no Council officer had authority to change the position of the access road.  The developer had no approval to build the access road on the public road and in so doing committed an offence against the Act.  The constructed access road is steep and dangerous but ultimately this is a concern for the Council not the court; his Honour refused the appellant's application for a declaration that the access road was unlawful because of dangerousness, despite consensus that the gate was dangerous if it had to be manually operated.  The appellant did not delay in making complaints about the unlawfulness of the works.  The Council's approval of 16 October 1996 is void and of no effect as no geotechnical report was obtained.  The Council's certificate of 13 May 1997 is void and of no effect; there was no certificate from a supervising engineer as required under the planning scheme.  The developer's right to rely on its title as registered proprietor under the Building Units and Group Titles Act 1980 (Qld) does not affect any declarations to which the appellant is entitled.  The developer's officer brought boulders onto the dedicated road and constructed two boulder walls that were dangerous, unlawful and a nuisance, in that they obstructed a highway without lawful authority.  The developer also committed a nuisance in erecting a gate across the dedicated road.  The appellant is entitled to a declaration that the erection of the boulder walls is unlawful and a nuisance.  The appellant is entitled to a further hearing in the Planning and Environment Court to investigate the Council's conduct in approving the second application to subdivide.  The present regrettable situation has been caused by the Council's officers who, at the hearing, were determined to justify their actions.[13]  Because the developer's subdivision was for eight allotments, not nine, the density provisions under the new planning scheme were not disregarded and the appellant was not entitled to the declaration she sought as to density.

[14]  On 17 March 1998, the learned primary judge ordered and declared that the developer committed an offence against s 2.23(1)(a) of the Act in contravening or failing to comply with conditions attached to the Council approval of 21 December 1994 by constructing the access road on the dedicated road to the east of the developer's land; that para 4.6 of the Planning Scheme for the Shire of Gatton applies to the development on a dedicated road; the purported approval of the Council of 16 October 1996 is void as there was no evidence to satisfy the Council that construction of access on the dedicated road should be permitted because the requirements of condition 16 of the approval were not satisfied; that as the requirements of para 7.3.1(2)(b) of the planning scheme were not complied with in that no certificate from the supervising engineer was obtained, the Council certificate of 13 May 1997 is void and of no effect; the two boulder walls were unlawfully placed on the dedicated road by the developer and are a nuisance; the appellant's requests for declarations about the unlawfulness of the steep access road, the gate, and the density provisions applying to the subdivision be dismissed; all other issues between the parties be adjourned for further consideration; each party to bear its own costs.  These orders were in the terms of the draft order handed to the judge by the appellant's solicitor.

[15]  The appellant was therefore largely but not wholly successful in her application.  The Council and the developer appealed to this Court to set aside those declarations.[14]  The appellant did not appeal from any of those orders and there is nothing before us to suggest that the appellant contended before the primary judge that the respondents should pay her costs because they conducted the proceedings in a way which was frivolous or vexatious.

[16] Davies JA and Wilson J made the following observations in their reasons for judgment with which McPherson JA largely agreed.  The developer's submitted surveyors' sketch plan in May 1995 for a proposed group title subdivision, explains but does not justify the construction of the roadway on the dedicated road.[15]  Whilst the construction of a roadway upon the dedicated road may have been unlawful, it was not a contravention of the conditions of the approval of 21 December 1994; the declaration that the developer committed an offence against s 2.23(1)(a) of the Act in contravening or failing to comply with those conditions should not have been made.  The learned primary judge's conclusion that the construction of the boulder walls constituted a public nuisance and an offence constituted by a contravention of para 7.3.1(2)(a) or (b) of the Planning Scheme was correct, although on a different basis, namely, that the work was done before obtaining subdivisional approval;   any mistake on the part of the developer was one of law, not fact and in any case was not reasonable.

[17]  This Court allowed the appeal, set aside the declarations made below and instead made the following declarations and orders.  First, the developer, by constructing a roadway and two boulder walls on the dedicated but unmade road to the east of its land without first obtaining the approval of the Council under para 7.3.1(2)(a) Planning Scheme, contravened para 7.3.1(2)(a) Planning Scheme and committed an offence under s 2.23(1)(a) of the Act.  Second, the developer, by completing the construction referred to in declaration 1 without first having planning and specifications for it approved by the Council under a subdivisional approval, contravened para 7.3.1(2)(b) Planning Scheme and committed an offence under s 2.23(1)(a) of the Act.  Third, the construction of the boulder walls and the dedicated road in contravention of paras 7.3.1(2)(a) and (b) constitutes a public nuisance.  The matter was remitted to the Planning and Environment Court to consider whether in the light of these declarations an order should be made under s 2.24(5)(b) of the Act, namely whether the boulder walls or road should be removed.  The respondent (the appellant in this appeal) was ordered to pay the appellant Council's costs of the appeal but was granted an indemnity certificate under the Appeal Costs Fund Act 1973 (Qld). 

[18]  The orders of this Court did not alter the learned primary judge's order as to the costs of the six day hearing.  The respondents did not contend in this appeal that the order of the Planning and Environment Court of 17 March 1998, that each party bears its own costs, precludes the appellant from now applying for the costs of that hearing under s 7.6 of the Act.  But the order of 17 March 1998 was a final order of the Planning and Environment Court made over four and a half years ago, from which there has been no appeal.  In the proceedings now appealed from, the appellant does not seem to have made an application to correct or set aside the costs order of 17 March 1998.  The circumstances in which a court of record may alter its own judgments after they have been formally entered are, in any case, very limited.[16]  On the material before this Court, it is inappropriate and in these circumstances not possible to now make a different order as to the costs of the six day hearing in the Planning and Environment Court in November 1997 and February 1998.[17]

[19]  The matter was next heard in the Planning and Environment Court on 27 March 2000  for consideration of the issue whether the boulder walls and/or alternatively the road should be removed.  It emerged at the hearing that the full Council had not considered whether the road should be removed.  His Honour expressed a desire to know the Council's attitude and response to the developer's belated application for approval and adjourned the appeal "so that the attitude of Council may be known and taken into effect".  His Honour adjourned the hearing to a date to be fixed.[18]  On 15 December 2000, his Honour accepted the view of the Council based on a traffic engineer's report that although the road is very steep and has sharp curves, provided drivers are given appropriate guidance, it can operate safely; the report suggested improvements to the road signage and markings which the Council agreed to implement.  His Honour refused to order the removal of the road.

[20]  The appellant appealed from this decision.[19]  On 14 September 2001, Davies and Thomas JJA and White J found that, although the opinion of the Council as the local road-making authority was a relevant matter to take into account in determining this matter, as the Council was a party with an interest in the outcome it was necessary to be cautious about the Council's opinion, let alone its wishes.[20]  The determination of what should be done to remedy the appellant's complaint was for the Planning and Environment Court, not the Council.  This Court allowed the appeal with costs and varied the order substituted by this Court in the earlier appeal[21] by adding a further declaration that the developer cause the construction of the dedicated road to be removed and the level of the road to be restored to natural surface level.

[21]  This Court made the following observations in its reasons for judgment.  The developer's contraventions were not merely technical; they were serious contraventions and a means of private gain.  The cost of removal and reinstatement to natural surface level was surprisingly small, about $35,000.  The road contained slopes exceeding recognised requirements of public safety; the only solution suggested by the Council was the erection of warning signs.  There was no evidence of any satisfactory intermediate remedy for the appellant short of removal to restore the former levels.  The placement and construction of the road was substantially different from the original proposal to build the road wholly on the developer's land.  There was no evidence of alternative arrangements which might eliminate the nuisance to the appellant, or that it would be uneconomic to make some alternative arrangement after removal of the nuisance.  A different access to the subdivision had already been sought by the developer by means of a track from Upper Flagstone Creek Road.  Although it would no doubt be inconvenient and expensive for the developer to resubdivide using alternative access, such an option was by no means ruled out.  The developer's access road unlawfully deprived the appellant of her access to the public road.  There was uncontradicted evidence of ongoing ingress of dirt and other problems occasioned by the batter banks onto the appellant's property."[22]  The Council was plainly a party with an interest[23] and the Council's officers were determined to justify their actions, an attitude which continued after the first decision of the Court of Appeal in the production of what appears to have been an invalid retrospective and unauthorised consent for the unauthorised road.  The Council's decision does not seem to have risen above the views of its officers.  The road as constructed was a public nuisance and the appellant demonstrated a continuing disadvantage from its presence; there was no sufficient reason of a private or public nature to decline to make an order against the developer for its removal. 

[22]  The next and hopefully final although continuing chapter in this saga is the appellant's application to the learned primary judge for a costs order against the respondents for all proceedings in the Planning and Environment Court under s 7.6 of the Act.[24]

The notices of contention

[23]  It is sensible to deal firstly with the respondents' arguments set out in their notices of contention that s 7.6(1A)(a) of the Act only empowers the Planning & Environment Court to make an adverse costs order for an initiating proceeding, not for a defence of proceedings, and, alternatively, that no adverse costs order can be made for part only of an appeal or other proceeding.

[24]  Normally costs in civil matters are at the discretion of the court, but ordinarily follow the event,[25] however s 7.6 of the Act relevantly provides:

"(1)  Subject to subsection (1A), each of the parties to an appeal or other proceedings is to bear their own costs.

(1A)  The Court may, upon application made to it, order such costs (including allowances to witnesses attending for the purpose of giving evidence at the hearing) as it considers appropriate in the following cases –

(a)where it considers the appeal or other proceedings to have been frivolous or vexatious;

(b)where a party has not been given reasonable prior notice of intention to apply for an adjournment of an appeal or other proceedings;

(c)where a party has incurred costs because another party has defaulted in the procedural requirements;

(d)without limiting the generality of paragraph (c), where a party has incurred costs because another party has introduced or sought to introduce new material without first giving the party reasonable time to consider the material;

(e)where a local government does not take an active part in the proceedings where it has a responsibility to do so.

… ."

[25]  The appellant relies only upon (1A)(a) above.

[26]  The respondents' contention is based in part on the decision in Begley v Pine Rivers Shire Council & Ors[26] where Skoien SJDC held that the words of s 7.6(1A)(a) of the Act only allow the court to exercise a discretion to award costs if the appeal or proceeding as a whole, not just in part, is frivolous or vexatious, not following Hudson Surveys Pty Ltd v Council of the City of Hervey Bay.[27]

[27]  The learned primary judge rejected the respondents' argument pointing out that in the Planning and Environment Court there are no pleadings and proof of an issue may be on a respondent; that respondent may be responsible for bringing forward substantial aspects of the whole proceedings.  Tactics or chance might cause one party to file the first application.[28]

[28]  Although the interpretation contended for by the respondents is arguably open on a literal interpretation of the words in s 7.6(1A)(a), the interpretation which achieves the purpose of the Act is to be preferred,[29] especially where the literal interpretation produces an odd result.  No clue as to legislative intent is provided in the Act's Second Reading speeches either when the Act was first passed or when this section was subsequently amended to add the words "or other proceedings" after "appeal" in s 7.6(1).

[29]  The objectives of the Act are:

"(a)to provide a code by which a local government or the Minister may undertake the planning of an area to facilitate orderly development and the protection of the environment; and

(b)to provide an adequate framework for a person to apply for approval in respect of a development proposal and to provide for appropriate appeal rights in respect thereof."[30]

[30]  The sub-paragraphs of s 7.6(1A) suggest the legislative intent is to give the court a power to award costs to compensate a party disadvantaged by the unmeritorious conduct of another party, as particularised in those sub-paragraphs.  The legislature must have intended to give the courts a discretion to award costs when any party conducts the proceedings in a way that is frivolous or vexatious; it could not have intended that respondents who behave in such a way should be immune from a costs order against them.  To accede to the respondents' contention would mean that a wealthy and powerful respondent could vexatiously and oppressively prolong proceedings causing the financial ruin of a worthy but less wealthy and less powerful appellant or applicant.  We are not prepared to give the sub-section such an unattractive meaning which would weaken the rule of law.  A respondent is not immune from a costs order under s 7.6(1A)(a).  Nor should s 7.6(1A)(a) be interpreted as limited to instances where the conduct of the entire appeal or proceedings is vexatious or oppressive; it extends to awarding costs to reflect a party's conduct of proceedings which is in part vexatious or oppressive.[31]  Both objectives of the Act favour such an interpretation.  The notices of contention are without substance.

Frivolous and vexatious?

[31]  The next question is whether his Honour erred in law in determining these proceedings were not frivolous or vexatious.  The awarding of costs and the determination of whether a proceeding is frivolous or vexatious involve discretionary considerations with which this Court will not lightly interfere.[32]

[32]  In determining the meaning of "frivolous or vexatious" in s 7.6(1A)(a) of the Act, his Honour considered the meaning of those words in applications to strike out frivolous and vexatious proceedings.[33]  His Honour also referred to a line of Planning and Environment Court cases which demonstrate a similarly cautious approach to ordering costs in frivolous or vexatious proceedings.[34]    His Honour additionally observed that in some instances a party may be guilty of an abuse of process which constitutes vexatious conduct.[35] 

[33]  After reviewing parts of the history of the litigation, the learned primary judge concluded that the attitude of the respondents was regrettable, particularly the attitude of the Council's officers, but the declarations ultimately obtained by the appellant were not those originally sought.  Resisting the removal of the road could not be seen as vexatious or an abuse of process as there were real considerations in favour of either conclusion; neither the Council nor the developer had acted in a vexatious or frivolous way and the applicant's application for costs could not be considered frivolous or vexatious. 

[34]  It seems likely that one purpose of s 7.6(1) of the Act, which sets out the general rule that each of the parties bear their own costs, consistent with the objectives of the Act,[36] is to ensure that citizens are not discouraged from appealing or applying to the Planning and Environment Court because of fear that a crippling costs order might be made against them.  The provision no doubt also recognises the public interest character of some applications to the Planning and Environment Court.[37]  For that reason, there is often an understandable judicial reluctance, demonstrated in the planning cases referred to by his Honour, in finding proceedings brought by citizens to be frivolous or vexatious. 

[35]  The words "frivolous or vexatious" are not defined in the Act and should be given their ordinary meaning, unfettered by their meaning in the very different context of striking out or staying proceedings for an abuse of process.  By the time an application for costs is made, the court knows the issues which have been litigated whilst a interlocutory applications, the court must to some extent speculate and must necessarily be cautious to ensure a deserving claimant is not unjustly deprived of the opportunity of a trial of the action.  The Macquarie Dictionary[38] defines "frivolous" as "of little or no weight, worth or importance; not worthy of serious notice: a frivolous objection.  2.  characterised by lack of seriousness or sense: frivolous conduct …" and "vexatious" as "1.  causing vexation; vexing; annoying …". 

[36]  Unquestionably, something much more than lack of success needs to be shown before a party's proceedings are frivolous or vexatious.  Although in a different context, some assistance can be gained from the discussion of the meaning of these words in Oceanic Sun Line Special Shipping Company Inc v Fay[39] where Deane J states that "oppressive" means seriously and unfairly burdensome, prejudicial or damaging and "vexatious" means productive of serious and unjustified trouble and harassment, meanings apparently approved by Mason CJ. Deane, Dawson and Gaudron JJ in Voth v Manildra Flour Mills Pty Ltd.[40]  Those meanings are apposite here.

[37]  Whether proceedings are vexatious or oppressive will turn on the circumstances of the case and will include public policy considerations and the interests of justice.[41]

[38]  The developer has been found to have committed serious offences against the Act for private gain which were not the result of a reasonable mistake.  It created a public nuisance on a road abutting the appellant's land causing ongoing ingress of dirt and other problems onto her property.  The Council's officers compounded this by purporting to give retrospective approval to the developer.  Well after the unlawfulness of their conduct should have been clear, the Council's officers persisted in defending their conduct.  They then tried to avoid their obligation to remove the road, a public nuisance, without offering any solution to the appellant.  In vindicating her position and protecting her rights, the appellant has been required to undertake a lengthy and no doubt expensive proceeding, made much longer and more expensive by the respondents' reprehensible conduct of it.

[39]  In our view, his Honour erred in placing undue weight on the meaning given to the words "frivolous or vexatious" in applications to strike out proceedings[42] and placed the bar for an applicant for costs under s 7.6(1A)(a) too high.

[40]  The respondents' application to summarily dismiss the appellant's action was, with hindsight, unjustifiable.  As to the substantive six day hearing in the Planning and Environment Court, the appellant was largely but by no means wholly successful, although lack of success, of course, is no measure of whether a proceeding is frivolous or vexatious.  The actions of the Council and the developer were resoundingly criticised both by the learned primary judge[43] and by this Court on appeal.[44]  Much of the respondents' defence of the proceeding was vexatious and oppressive in the Oceanic sense.  On the other hand, the appellant was unsuccessful on some issues which the respondents were completely justified in defending.  Importantly, had the appellant more clearly and precisely identified her concerns at the outset of her application, it is quite possible the respondents may have acted more reasonably. 

[41]  The remaining appearances in the Planning and Environment Court involved the removal of the road.  The learned primary judge was of the view that at least some considerations favoured removal and it was a matter on which reasonable minds could differ.  That, however, was not the view of this Court, which observed there was no evidence of any satisfactory intermediate remedy short of removal and all the evidence before the Court favoured removal.  In these circumstances, the respondents' action in resisting removal of the road was vexatious and oppressive in the Oceanic sense. 

[42]  Once it is established a party's conduct of proceedings is frivolous or vexatious, there is an unfettered discretion to award costs, which this Court should now exercise.  We can see no basis for distinguishing between the conduct of the developer or the Council in these proceedings.  The appellant is deserving of a costs order in her favour to compensate her for the additional expense to which she has been put because of the respondents' vexatious and oppressive conduct of the proceedings.  On the other hand, the appellant did not succeed on a number of issues and could have better clarified and refined the real issues in the case at an earlier stage.  The respondents have had the benefit of an order that each party bears its own costs of the substantive six day hearing.  On the material before us, this Court should not interfere with that order.  In all the circumstances, the respondents should pay the appellant's costs of and incidental to all remaining appearances in the Planning & Environment Court in proceedings No 1387 of 1997.

Orders:

[43]  1.Appeal allowed.

2.Set aside the order of the Planning and Environment Court of 31 January 2002.

3.Order that the respondents Gainriver Pty Ltd and Gatton Shire Council pay to the appellant the costs of proceedings No 1387 of 1997 in the Planning and Environment Court other than costs dealt with by the order of 17 March 1998, but including all costs reserved and in particular costs reserved by the order of 19 September 1997 to be assessed according to the scale of costs prescribed by law for the time being in respect of proceedings in the District Court for claims in excess of $50,000.

4.Order that the respondents pay the appellant's costs of and incidental to the application for costs in the Planning and Environment Court to be assessed on the aforesaid scale and of and incidental to the appeal to be assessed.

[44]  WILLIAMS JA:  I have had the advantage of reading the joint reasons for judgment of the President and Atkinson J and I will not unnecessarily repeat facts stated therein.

[45]  Against the background of what occurred between May 1994 when Gainriver Pty Ltd (“Gainriver”) applied to the Gatton Shire Council (“Gatton”) for subdivisional approval with respect to certain land and April 1997 by which time Gainriver had carried out works, including the construction of a road associated with that subdivision, the appellant (who was an adjoining land owner) commenced proceedings by application filed 9 April, 1997, in the Planning and Environment Court (No 1387 of 1997) seeking the following orders:

“1.  A declaration that the use of land being a road reserve adjoining Lot 1 on RP 216283 and Lot 755 on RP 905938 further adjoining the said road reserve is a nuisance and dangerous and illegal.

2. An Order restraining the First Respondent [Gatton] from approving the use of the land aforesaid.
3. An Order that the First Respondent [Gatton] reinstate the stability and drainage of the land referred to forthwith.
4. A Declaration that the level of the road adjoining Lot 1 on RP 216283 is not the level determined by “the plans” of Kehoe Meyers and a Declaration that it is beyond the jurisdiction of the Gatton Shire Council to fix the permanent level of the said road by reference to the said purported plans under s 513 of the Local Government Act 1993.
5. Such further or other order as to the Court may seem fit.”

[46]  Gatton and Gainriver disputed the jurisdiction of the Court to deal with that application; argument on that issue was spread over two days and on 20 August 1997 the Court held that it had jurisdiction and reserved the costs of the application: Mudie v Gatton Shire Council & Anor [1998] QPELR 373.  The formal order is dated 19 September 1997.  Thereafter the learned judge conducted a hearing over six days and gave judgment on 27 February 1998: Mudie v Gatton Shire Council & Anor [1998] QPELR 375.  The orders formally made on 17 March 1998 were as follows:

“1.  Declare that Gainriver has committed an offence against s 2.23(1)(a) of the Local Government (Planning and Environment) Act 1990 in that it contravened or failed to comply with Conditions 11 and 13 attached to the Gatton Shire Council’s approval of 21 December 1994, by constructing the access road on the dedicated road to the east of Gainriver’s land.

2.Declare that:

(a)On its proper construction para 4.6 of the Planning Scheme for the Shire of Gatton applies to development on a dedicated road;

(b) The purported approval of the Gatton Shire Council dated 16 October 1996 is void, and of no effect, as there was no evidence put before Council to satisfy it that the construction of the access on the dedicated road should be permitted, and as the requirements of Condition 16 were never satisfied.

3. Declare that, as the requirements of para 7.3.1 (2)(b) of the Planning Scheme were not complied with, in that no certificate from the supervising engineer was obtained, the certificate of the Gatton Shire Council of 13 May 1997 is void and of no effect.
4. Declare that the two boulder walls, described in the affidavit of A Thompson were unlawfully placed on the dedicated road by Gainriver, and are a nuisance.
5. Order that the applicant’s request for declaration about unlawfulness of the steep access road, the gate, and the density provisions applying to the subdivision, be dismissed.
6. Order that all other issues between the parties be adjourned for further consideration.
7. Order that each of the parties bears their own costs.”

[47]  Gatton and Gainriver each appealed against the order of 27 February 1998.  There was no appeal against the costs order.  The appeals were heard together on 11 March and judgment handed down on 16 July 1999: Gatton Shire Council v Mudie (1999) 103 LGERA 419. 

[48]  Each member of the court (Davies and McPherson JJA and Wilson J) was in agreement as to the orders which should be made.  The appeal was allowed to the extent of setting aside the declarations set out in paragraphs 1 to 4 of the Order quoted above and in lieu thereof the following declarations and orders were made:

“3.Declare that Gainriver Pty Ltd, by constructing a roadway and two boulder walls on the dedicated but unmade road to the east of its land without first obtaining approval of the Gatton Shire Council pursuant to par 7.3.1(2)(a) of the Planning Scheme for Shire of Gatton, has contravened par 7.3.1(2)(a) and has thereby committed an offence under s 2.23(1)(a) of the Local Government (Planning and Environment) Act 1990.

4. Declare that Gainriver Pty Ltd, by completing the construction referred to in declaration 1 (sic) without first having plans and specifications for it approved by the Gatton Shire Council pursuant to a subdivisional approval, has contravened par 7.3.1(2)(b) of the Planning Scheme for the Shire of Gatton and has thereby committed an offence under s 2.23(1)(a) of the Local Government (Planning and Environment) Act 1990.
5. Declare that the construction of two boulder walls on the dedicated road in contravention of par 7.3.1(2)(a) and par 7.3.1(2)(b) constitutes a public nuisance.
6. Order that the matter be remitted to Planning and Environment Court to consider whether, in the light of these declarations, an order should be made under s 2.24(5)(b) of the Local Government (Planning and Environment) Act 1990.
7. Order that the respondent Mudie pay to the appellant Gatton Shire Council its costs of its appeal.
8. The respondent Mudie be granted an indemnity certificate pursuant to the Appeal Costs Fund Act 1973.”

[49]  Otherwise the order of the Planning and Environment Court was not interfered with.

[50]  As the Court of Appeal said in a later judgment [[2002] 2 QdR 53 at 56-57], the following express findings of fact made by the Planning and Environment Court in its original judgment “remained relevant for the purposes of the further proceedings”.  Those findings of fact were the following:

“(b)The Council approval of 21 December 1994 required the access road to be on Gainriver’s land.

(c)Mr Keogh’s [Gainriver’s engineers] amended plans, placing the access track on the dedicated road were not approved by Council.  No Council officer had authority to change the position of the access track.

(d)Gainriver had no approval to building the access track on the dedicated road.

(e)In building the access track on the dedicated road, Gainriver committed an offence against the P & E Act.

(f)The access track, as constructed is steep and dangerous.  However, the state of that track is ultimately a matter for Council and not the Court.

…

(i)Council’s apparent approval of 16 October 1996 is void and of no effect, as a geotechnical report was not obtained, and also because Condition 16 was never fulfilled.

…

(o)The present regrettable situation has been caused by the Council’s officers.  At the hearing, they were determined to justify their actions”.

[51]  The reasons of the Court of Appeal delivered 16 July 1999 were in general highly critical of the conduct of Gatton and Gainriver; for example Davies JA and Wilson J said at 427:

“But the work at the intersection of the internal access road with the dedicated road and on the dedicated road could not have been completed in accordance with any such approved plans and specifications because, when completed, there was no relevant subdivisional approval.  By completing the work at the intersection and on the dedicated road before obtaining the subdivisional approval to which that work related Gainriver put it out of its power to give any such certificate by an engineer that that work was completed in accordance with plans and specifications approved pursuant to that subdivisional approval”.

[52]  The matter then went back to the Planning and Environment Court.  It appears that the matter came before the judge on 27 March 2000 and on that occasion some reliance was placed by Gainriver on a decision by a Mr Schumacher, the chief executive officer of Gatton.  There was a challenge to that evidence which ultimately led to further proceedings in the Court of Appeal being [2000] QCA 260, judgment delivered 3 July 2000.  Before the Court of Appeal “no-one objected to the decision of Mr Schumacher being declared void”.

[53]  Thereafter there were further hearings in the Planning and Environment Court which resulted in the decision of 15 December 2000.  The issue essentially litigated on that occasion was whether or not the road should remain or be removed.  Critically for present purposes the learned judge refused to order that the road be removed though he made unopposed orders in relation to the removal of the boulder walls and certain other works.  The order of 15 December 2000 did not refer to costs.

[54]  From that decision the appellant again appealed to the Court of Appeal; the matter was heard on 31 August and judgment delivered on 14 September 2001:  [[2002] 2 QdR 53].  The following passages from the joint judgment of Davies and Thomas JJA and White J are relevant for present purposes.

“In the Court of Appeal a declaration had been made that the boulder walls constituted a public nuisance.  A similar declaration of “public nuisance” could have been made in respect of the construction of the unauthorised roadway, but for reasons which emerge at pp 430-431 of the report of that decision it was not necessary for the Court of Appeal to determine that particular question, and no request was made for such relief in the somewhat disjointed procedure that occurred by way of supplementary submissions.  Instead, the making of such a declaration or finding, and the question whether an order for removal of the road should be made was left to the Planning and Environment Court.

In the March hearing Gainriver relied upon an affidavit sworn by its director, Mr Nikdin requesting that the road remain in place, and exhibited a document signed by a Mr Schumacher which Mr Nikdin described as an approval issued by the Gatton Shire Council in respect of his company’s application for approval of the road.  Questions were then raised concerning whether the Council had power to grant a retrospective approval of this kind and the further question whether Mr Schumacher in any event had the authority of the Council to grant such an application (it may be noted that in subsequent proceedings for judicial review of this “approval”, its invalidity was conceded by the Council).  In the course of argument before his Honour it became clear that the full Council had not considered what should be done in relation to the road.”  (57-58)

The Court then went on at 59-60 to specifically note:

“Gainriver’s contraventions were not merely technical - they were serious contraventions and were a means of private gain.  ...

The cost of removal in (sic) reinstatement to natural surface level was surprisingly small – about $35,000. 

…

Mrs Mudie was unlawfully deprived of access which she had formerly enjoyed to the dedicated road.

There was uncontradicted evidence of ongoing ingress of dirt and other problems occasioned by the batter banks onto Mrs Mudie’s property.”

[55]  Ultimately the Court concluded (63) that “the road as constructed was a public nuisance, that Mrs Mudie demonstrated a continuing disadvantage from its presence, and that no sufficient reason of either a private or public nature exists to decline to make an order against Gainriver for its removal”.  The court allowed the appeal to the extent of adding an order that the road in question “be removed and the level of the road be restored to natural surface level”.  It also ordered the respondents, Gainriver and Gatton, to pay the appellant’s costs of the appeal.

[56]  In so far as the decision involved an exercise of discretion, the Court held that the only conclusion reasonably open was that the road should be removed.

[57]  According to the appellant’s outline of argument she made application for an order for costs on 2 November 2001.  There does not appear to be any such formal application on the file, and the order ultimately made with respect to costs on 31 January 2002 describes the originating application as being that filed 9 April 1997, the originating application quoted above.  Given the provisions of s 7.6 of the Planning and Environment Act, quoted in the reasons of the President and Atkinson J, Brabazon DCJ refused to make a costs order in favour of the appellant for reasons delivered on 31 January 2002.  It is from that judgment that this appeal is brought.

[58]  The following extracts from the reasons for judgment are relevant:

“… the basic rule according to that section is that each of the parties to an appeal or other proceedings is to bear their own costs.

…

… the statutory power to award costs is not necessarily confined to a party who formally brings an appeal or an application in this Court.

…

I do not accept the submission that only an applicant who brings proceedings can be the subject of an order for costs for vexatious proceedings.

… it is no barrier to an order for costs that only part of a proceedings is vexatious.

…

… all of the litigation followed inaccurate and wrong assertions by the Council’s officers when Dr Mudie and her solicitor complained about work that was beginning on the public road.  The complaints were early ones, and were met by assertions that all necessary approvals, in effect, had been given.  It is only at the end of this litigation, which owes a lot to the persistence of Dr Mudie and her solicitor, that her position has been quite vindicated.

…

Part of the trial was taken up with dealing with the presence of the boulder walls not the responsibility of Council where, it must be said, opinions differed as to their stability and the merits of their construction.  The Council succeeded on issues with regard to the entrance and the density of development in the subdivision. …

Importantly, the removal of the road which was ultimately ordered by the Court of Appeal was done so, as that Court stressed, because of a discretion to do so.  That is, a discretion which, according to the Court of Appeal, was wrongly exercised by the trial judge and was reversed in the Court of Appeal.

…  Council’s officers maintained aspects of their unauthorised conduct right up until a hearing in this Court on 22 March 2000 when they purported to approve, even then, the road as constructed.

…

… the Council should have recognised the weaknesses in significant parts of its position long before they were found against it either here or in the Court of Appeal.

…

… the attitude of the respondents was regrettable, particularly the attitude of the Council’s officers.  But it would not be right to say, in my opinion, that its conduct was frivolous or vexatious. It was, after all, in a position of a defendant in a one off and unusual case.

…

If this Court had the usual power to award costs, then Dr Mudie would certainly have been compensated by the recovery of most of her costs.

…

The same result, I should say, applies against both the Council and against Gainriver”.

[59]  For the appellant to succeed the court must be satisfied that the appeal to the Planning and Environment Court was “frivolous or vexatious” within the meaning of those words in the section of the legislation empowering the court to make an order for costs.  Each word is used in everyday language and there is little doubt as to the ordinary meaning of each.  The Shorter Oxford English Dictionary defines “frivolous” as follows:

“1. Of little or no value or importance, paltry; (of a claim, charge, etc) having no reasonable grounds.  2.  Lacking seriousness or sense; silly.”

That work defines “vexatious” as follows:

“1.  Causing or tending to cause vexation, annoyance, or distress; annoying, troublesome.  2.  In law.  Of an action; instituted without sufficient grounds for winning purely to cause trouble or annoyance to the defendant.”

[60]  So far as the law is concerned the terms have been incorporated into rules of court as a ground upon which a claim may be struck out summarily.  If a proceeding discloses no viable cause of action it can be struck out as being frivolous or vexatious.  In consequence something of a gloss has been superimposed upon the ordinary meaning of each word when used in that context.  But when the terms are not used in the context of striking out a claim which is groundless that gloss is no longer relevant and one must revert to the ordinary meaning of each word.  But that is not to say that cases dealing with the striking out of an action on the ground that it was frivolous and vexatious are entirely irrelevant.  Dixon J in Dey v Victorian Railways Commissioners (1949) 78 CLR 62 at 91 said:

“The application is really made to the inherent jurisdiction of the court to stop the abuse of its process when it is employed for groundless claims”.

[61]  Section 7.6 of the Local Government (Planning and Environment) Act 1990 clearly could apply to the situation where an appeal was struck out because it was groundless, but there is no reason to so limit the operation of the provision.  If it was only to apply to the striking out of an appeal then it would have been easy for the legislation to have so provided.  In this area of the law it quite often happens that more than one party is dissatisfied with a decision of a local authority which may be the subject of an appeal.  In those circumstances it is often merely an accident that a particular party is the appellant for purposes of the appeal.  Once the appeal is instituted other affected parties may raise additional issues for determination by the court.  If a party resisted such an appeal by relying on assertions which were groundless then there is no reason why that party’s conduct should not be described as being “frivolous or vexatious”.  To adapt the phraseology of Dixon J, in such circumstances there has been an abuse of process in that the court’s time and resources have been employed in exposing a groundless basis for resisting the appellant’s claim.  Further, the meaning attributed to the word vexatious by Deane J in Oceanic Sun Line Special Shipping Company Inc v Fay (1988) 165 CLR 197 at 247 also covers that situation; there it was said:  “Vexatious should be understood as meaning productive of serious and unjustified trouble and harassment”.  A developer and local authority clearly produce unjustified trouble and harassment when they resist in court the setting aside of void decisions and seek to justify unlawful conduct on wholly unmeritorious grounds.  Such resistance would, in ordinary parlance, be described as “frivolous and vexatious”.

[62]  The rather lengthy summary of the proceedings between the appellant on the one hand and Gatton and Gainriver on the other set out above would, in my view, leave no doubt in the mind of an impartial observer that the conduct of Gatton and Gainriver was, at least, vexatious; certainly that would be so after the initial finding that the road as constructed was a public nuisance and no lawful approval for it existed.  Not only did each maintain the lawfulness of conduct when it was obvious that necessary approvals had not been given; they went further and sought to benefit from work affecting the appellant’s rights which had been carried out without lawful authority.  Further, attempts were made, improperly, to cover up those failings and to give the aura of legality to what had occurred.

[63]  Most of that appears to have been accepted by the learned judge at first instance.  The extracts quoted in para [58] hereof indicate that.  In the end it appears that the learned judge at first instance declined to hold that the relevant conduct was frivolous and vexatious for two reasons:

(i) Gatton in particular was in the position of a defendant in a one off and unusual case;

(ii) The ultimate order that the road be removed was the result of an exercise of discretion by the court.

[64]  The first point is, in my view, adequately answered by the two earlier judgments of the Court of Appeal and most of the findings of the learned judge at first instance quoted above in para [58].  Gatton must have realised at the time the proceedings were instituted that there were serious breaches of its planning laws and that its officers had not taken the necessary steps to ensure that construction work carried out by Gainriver was in accordance with valid Council approvals.

[65]  Further, it must have been obvious to Gainriver that it had carried out work which was not the subject of an approval validly obtained from the local authority.

[66]  Both Gatton and Gainriver persisted in groundless opposition to the appellant’s claim notwithstanding a number of judicial pronouncements indicating they could not succeed in resisting the application.

[67]  As already noted this was not a situation where there were reasonable grounds on which a court could be asked to exercise its discretion in favour of leaving the road as constructed.  On all occasions the judge at first instance or this court dealt with the matter the road as constructed was described as a nuisance.  Because it had been constructed without proper authorisation and was a public nuisance the only reasonable course open was to order its removal.  One cannot justify the conduct of Gatton and Gainriver by saying that at the very end of the proceedings an exercise of discretion by the court was called into play.

[68]  For all of those reasons I agree with the President and Atkinson J that in this case the appellant has established that the resistance by Gatton and Gainriver to the proceeding commenced by the appellant was frivolous and vexatious.  The appellant is therefore entitled to an order for costs in her favour.  The issues raised by Gatton’s Notice of Contention are sufficiently dealt with by the President and Atkinson J in their reasons. 

[69]  It then becomes necessary to determine what costs the appellant should recover.  The order of 17 March 1998 after the six day trial was that “the parties bear their own costs”.  Such order gave due allowance to the fact that the respondents succeeded on some issues.  That was a final order which was not affected by the appeal from other parts of the overall order.  Neither the judge at first instance on the costs application nor this court on the hearing of this appeal could interfere with that.  Because that order of 17 March 1998 did not deal specifically with the costs reserved by the order of 19 September 1997 this court has the power to determine what should happen to those costs then reserved. 

[70]  No other specific order has been made with respect to proceedings in the Planning and Environment Court in Appeal 1387 of 1997.  The appellant should get those costs.

[71]  The orders of the court should therefore be:

1. Appeal allowed.

2. Set aside the Order of the Planning and Environment Court of 31 January 2002;

3. Order that the respondents Gainriver Pty Ltd and Gatton Shire Council pay to the appellant the costs of proceedings No 1387 of 1997 in the Planning and Environment Court other than costs dealt with by the order of 17 March 1998 but including all costs reserved and in particular costs reserved by the order of 19 September 1997 to be assessed according to the scale of costs prescribed by law for the time being in respect of proceedings in the District Court for claims in excess of $50,000.00.

4. Order that the respondents pay the appellant’s costs of and incidental to the application for costs in the Planning and Environment Court to be assessed on the aforesaid scale and of and incidental to the appeal to be assessed.