VICTORIAN CIVIL AND ADMINISTRATIVE TRIBUNAL
planning and environment LIST	vcat reference NoS. P1271/2023 & P1275/2023

Applicant	Scotts Securities Pty Ltd	
Relevant Authority	Melton City Council	
SUBJECT LAND	2389 Diggers Rest-Coimadai Road
TOOLERN VALE  VIC  3337	
HEARING TYPE	Costs Hearing on the papers	
DATE OF HEARING	31 October 2024	
DATE OF ORDER	24 December 2024	
CITATION	Scotts Securities Pty Ltd v Melton CC (Costs) [2024] VCAT 1222	

Order

1	The application by the Melton City Council for an award of costs against Scotts Securities Pty Ltd pursuant to section 109 of the Victorian Civil and Administrative Tribunal Act 1998 (Vic) is refused.

J Perlstein
Presiding Member	M Deidun
Member	

Reasons

1	On 13 September 2024, in Scotts Securities Pty Ltd v Melton CC [2024] VCAT 878 (‘Scotts Securities’), the Tribunal made the following orders:
APPLICATION P1271/2023
Certificate of compliance application
1	In the application for review of the failure of the responsibly authority to issue a certificate of compliance, the Tribunal directs, pursuant to section 97P(2)(a) of the Planning and Environment Act 1987 (Vic), that a certificate of compliance must not be issued.
APPLICATION P1275/2023
Determination application
2	The Tribunal declines to make the declarations sought by the applicant pursuant to section 149A of the Planning and Environment Act 1987 (Vic), and the application is refused.
2	In Scotts Securities, the Tribunal referred to the applications as the ‘Review proceeding’ and the ‘Determination proceeding’ respectively. The same terminology will be used in this decision. 
3	The Melton City Council (‘council’) had foreshadowed that it would seek an application for costs if successful and a process was put in place to facilitate that application.
4	The council made its application, seeking costs up to approximately $150,000, but asking that the quantum of costs be determined by consent following an order of the Tribunal, or by the Costs Court, in the absence of consent. The applicant filed submissions opposing the making of an order for costs.
5	The Tribunal has considered the submissions and supporting documents filed by both of the parties and determined that each party pay its own costs of the proceedings. Our reasons follow.
Quantum of costs 
6	In an unusual approach, the council did not provide a precise breakdown of costs incurred in these proceedings. It provided overall legal costs incurred with respect to applications P1271/2023 and P1275/2023 as well as legal costs incurred in P1238/2023, which was resolved by consent following a compulsory conference. The council says that it is unable to proportion costs referable to P1238/2023 and considers that this can be undertaken during the taxation process. The council also acknowledged that costs for the final day of hearing ought not be awarded and said that these are likely to be in the realm of $5,950, without providing a fixed cost. 
7	The council also included three invoices from Beck Legal with the heading ‘P1268/2023’ totalling approximately $45,000. It is possible that those invoices refer to work undertaken with respect to P1238/2023. However, on a cursory scan of the items, they do not appear to relate to the proceedings the subject of this application in any way and include evidence from persons unrelated to these proceedings.  
8	Where costs have been incurred and a party is requesting that its costs be paid by another party, it is the responsibility of the party seeking costs that it articulates those costs. The Tribunal is concerned with the approach taken by the council in this mater, seeking costs orders from the Tribunal prior to an understanding of the quantum of costs sought, and including costs relating to matters that are not before the Tribunal.
9	Ultimately, however, regardless of the quantum, the Tribunal must determine whether an order for costs is appropriate having regard to the matters set out in section 109 of the Victorian Civil and Administrative Tribunal Act 1998 (Vic) (‘VCAT Act’).
Power to award costs
10	Section 109 of the VCAT Act provides as follows:
109	Power to award costs
(1) 	Subject to this Division, each party is to bear their own costs in the proceeding.
(2) 	At any time, the Tribunal may order that a party pay all or a specified part of the costs of another party in a proceeding.
(3) 	The Tribunal may make an order under subsection (2) only if satisfied that it is fair to do so, having regard to—
(a) 	whether a party has conducted the proceeding in a way that unnecessarily disadvantaged another party to the proceeding by conduct such as—
(i) 	failing to comply with an order or direction of the Tribunal without reasonable excuse;
(ii) 	failing to comply with this Act, the regulations, the rules or an enabling enactment;
(iii) 	asking for an adjournment as a result of (i) or (ii);
(iv) 	causing an adjournment;
(v) 	attempting to deceive another party or the Tribunal;
(vi) 	vexatiously conducting the proceeding;
(b) 	whether a party has been responsible for prolonging unreasonably the time taken to complete the proceeding;
(c) 	the relative strengths of the claims made by each of the parties, including whether a party has made a claim that has no tenable basis in fact or law;
(d) 	the nature and complexity of the proceeding;
(e) 	any other matter the Tribunal considers relevant.
11	The Tribunal must consider section 109 in deciding whether parties should bear their own costs in the proceeding or whether, having regard to the matters said out in section 109(3), it is fair to make an order that one party pay all or a specified part of the costs of another party in a proceeding. 
12	As noted by the Tribunal in Moore v Minister for Planning:
There is a long line of Tribunal cases which confirm that an award of costs is not to punish the unsuccessful party but rather to compensate a party who has incurred costs which in the circumstances, would be unfair for that party to be liable for such costs.
Submissions of the council
13	The council relies on section 109(3) as a whole in submitting that it is ‘fair overall’ to award costs in this proceeding, while also highlighting specific elements within that section.
14	The council submits that both proceedings are ‘inextricably interwoven’ and should be treated as one for the purposes of the costs decision, relying on the decision of Mornington Peninsula SC v Ackermann & Ors [2011] VCAT 164.
15	The council commenced its submissions, seeking that costs be ordered, in summary, for the following reasons:
a	The way in which the application for a certificate of compliance was filed with the council was vague and poorly framed, and this continued throughout the Review proceeding. So too, the application for declaration was framed in a broad way, lacking detail and unsupported by submissions and evidence.
b	The applicants were twice asked to provide further and better particulars and failed to address, with clarity, the particulars sought. The application for declaration was not properly articulated in terms of the existing use asserted or the basis on which it was asserted. 
c	The council’s behaviour during the hearing was to actively promote the efficiency of the proceeding and not cause any unreasonable delay.
16	The council then referred to the following specific elements of section 109(3):

a	Nature and complexity
The council referred to the Declaration proceeding being in the Tribunal’s original jurisdiction and the complexity of preparing responses to each of the elements within the application for declaration despite the applicant not pursuing many of those elements in submissions.
b	Relative strength of the claims
The council submitted that evidence was not provided to support the existing use rights asserted and did not make connections between the use of horse husbandry and the fill activities sought to be included in existing use rights. The applicant did not submit legal arguments in support of many of its claims and failed to address many of them in any material way.
c	Party causing an adjournment
An adjournment of the final hearing day was required to provide further evidence. The council submits that the applicant caused the adjournment by its ‘lack of clear evidence, poorly framed application, and at times, unclear and contradictory evidence’. 
The council submitted that this contrasts with the council’s conduct during the proceeding and its provision of clear, consistent and well framed arguments.
d	Any other relevant factor
The council submitted that the original jurisdiction of the Declaration proceeding lends itself more readily to a costs order, and that although the Review proceeding is in the review jurisdiction, it is similar to the Declaration proceeding.
The council submitted that it is in the interests of justice that proceedings of this nature ‘warrant a carefully considered application supported by cogent evidence’ and that the Tribunal should discourage poorly thought out applications for review.
17	The council concluded as follows:
59.	Council submits that at no time did the Applicant present evidence to the standard that is required for the Tribunal to make a determination in the manner in which was being sought by the Applicant.
60. 	In summary, this is a case where the circumstances are such that it would be wholly inequitable and unfair to require the ratepayers to bear the costs referable to the Applicants broad and largely unsubstantiated Application and the costs of dealing with and responding to, what is submitted is a poorly conceived Application.
61. 	It is submitted that Council has acted as a fair, reasonable and responsible Responsible Authority in responding to the Applications.
62. 	Council contends that in the circumstances of this matter, it is fair that it be reasonably compensated for the costs it has been forced to incur in responding to the Application but particularly, the costs incurred by Council to respond to points relied on by the Applicant, but ultimately never addressed and hence, not pressed and abandoned.
Submissions of the applicant 
18	The applicant resisted an order for costs that relate to both proceedings as a whole, on the basis that the proceedings, whilst heard and determined together, remained as separate proceedings. The council submitted that the facts of these proceedings could be distinguished from the decision cited by the council, where the two proceedings were dependent on each other. In this case, the applicant referred to the Tribunal’s view that the Declaration proceeding could be determined regardless of whether a certificate of compliance was issued in the Review proceeding.
19	With respect to the Review proceeding, the applicant submitted that:
a	The proceeding was initiated following the failure of the council to determine the application;
b	The council filed a joint statement of facts agreeing to existing use of the land for specific purposes, stated in written submissions that the evidence of the applicant shows, on the balance of probabilities, a basis for the establishment of existing use rights for horse husbandry; and signed proposed minutes of consent for a certificate to issue in the following terms:
The existing use of the land for the purpose of Horse husbandry including breeding, spelling, weaning, foaling down, yearling preparation, broodmare agistment, general sales preparation, overnight and short-term stabling, horse rehabilitation, and recovery of racehorses.
c	It was the Tribunal that raised questions about the continuity of the use, which resulted in the further evidence required and the change in position of the council; and 
d	The council prolonged the proceeding because it did not form an initial position on the application when filed with the council.
20	The applicant submitted that no circumstances identified by section 109(3) of the VCAT Act arise from its conduct of the proceedings.
21	With respect to the Declaration proceeding, the applicant submitted that the application was sought to resolve a dispute with the council concerning planning permission required for placement of fill, in circumstances where the applicant has been unable to proceed with its plans for the property through planning permission or certificates of compliance and has been through prosecution and enforcement proceedings. The applicant submitted that:
44	The Tribunal’s advisory opinion is for Scotts Securities Pty Ltd to apply for a certificate of compliance for a proposed placement of fill to top dress paddocks. Scotts Securities Pty Ltd cannot continue to fight the Melton City Council with the prosect of cost applications, in a jurisdiction where the starting position is each party bears its own costs.
45 	The application for a determination sought to provide clarity concerning the continued impasse with the Melton City Council regarding placement of fill to top dress paddocks to improve the property.
22	The applicant submitted that none of the matters in section 109(3)(a) arise in these proceedings and that:
54	Scotts Securities Pty Ltd sought to expeditiously advance its application and did so noting the matters conceded by the Melton City Council in its statement of grounds, joint statement of facts, written submissions and minutes of consent, all of which remained in place until the Melton City Council withdrew its consent position on day 3 of the hearing and made final submissions contrary to that contention. 
23	With respect to the matters in the remainder of section 109(3), the applicant made the following submissions (footnotes excluded):
56	The Tribunal did not find that there was no tenable basis in fact or law, rather that it was not satisfied on the evidence.
57 	Indeed, the Tribunal has specifically addressed the difference between a “weak” and “untenable” application by clarifying that:
“A difficult, doubtful or test case might be necessary to clarify the legal position of the parties. It is probably seldom that an order for costs would be made having regard to this consideration alone where there is a real issue to be tried and real justification for the claims made on either side.”
58 	The Tribunal has clarified this by stating:
“Rather, the focus of paragraph 109(3)(c) is to examine whether prospectively one party had an extremely weak, or unsustainable case, but still persisted in making it in circumstances where there was no reasonable prospect of success. As such, whether there is a tenable basis in law or fact for a party’s claim is part of the required consideration in paragraph 109(3)(c), but it is not the sole or determinative consideration in terms of an application for costs. Indeed, adopting such an approach would undermine the general rule in subsection 109(1) that each party is to bear their own costs in a proceeding.”
59 	In relation to proceeding P1275/2023 the Tribunal held that the determination sought was advisory in nature and unable to be made by the Tribunal pursuant to section 149A. As detailed above, Scotts Securities Pty Ltd filed the application seeking to resolve a continued dispute with the Melton City Council that has seen it prosecuted in the Magistrates Court of Victoria.
60 	Complexity in a hearing can be considered both ways with respect to costs, with Deputy President Dwyer finding: 
“the issue of complexity also potentially ‘cuts both ways’ in relation to costs. Complexity will not always be a factor in favour of a costs award – the novelty or public interest in the issues ventilated before the Tribunal may sometimes militate against an award of costs despite the relative complexity of the proceeding.
Here, I do not consider that the fact that this proceeding comprised a declaration proceeding requiring a hearing before a presidential member, raising complex issues, and that was conducted by senior counsel with a ‘court-like’ character, is sufficient to justify a costs award. In my view, these factors would still, by themselves, be rarely sufficient to depart from the general rule that each party bear its own costs at VCAT.” [emphasis added]
61 	Scotts Securities Pty Ltd leaves the Tribunal empty handed with nothing more than advisory opinion from the Tribunal that it was open to apply for a certificate of compliance at the time the land was purchased.
62 	The costs incurred by the Melton City Council in the proceedings are excessive and clearly include matters that are beyond the scope of the proceedings P1271/2023 and P1275/2023, such as preparation of an affidavit of Kane Gebert, that was not filed in either proceeding or proceeding P1268/2023.
63 	In all of the circumstances it is not fair, or just, to award costs in favour of the Melton City Council against Scotts Securities Pty Ltd.
24	The applicant also submitted that the council is discharging its duty as the responsible authority in responding to the applications before the Tribunal, that it did not discharge its duty in failing to initially determine the certificate of compliance application and that awarding costs to the council for the discharge of its duty is inconsistent with Tribunal practice and section 109(1), that each party bears its own costs.
Consideration of the Tribunal
25	At the outset, the Tribunal does not agree with the council contention that the two proceedings are inextricably interwoven. The Tribunal considered and determined each proceeding separately. This reflected the way in which the hearing was conducted, with each application being dealt with separately, to the point where application P1275/2023 was completed prior to the final day of hearing which was convened to consider only P1271/2023.
26	While the two proceedings were listed together and the parties provided a single submission for both, the submissions themselves had to deal with each application separately and the facts relevant to each of the applications were markedly different.
27	We therefore deal with each proceeding separately.
Review proceeding
28	Given the way in which the council approached its costs submissions with the proceedings interwoven, there were many aspects of the submissions that were confusing and unclear in terms of to which proceeding they related. In addition, the council referenced the ‘Application’ several times with different meanings. For example, paragraph 23 of the council’s submissions provides as follows:
Council submits that the Applicant provided insufficient description both at the outset of the Application, and for the remainder of the Proceeding for Council to conceivably consider issuing a certificate that such proposed use would comply with the Melton Planning Scheme.
29	This paragraph refers to the application to the council for a certificate of compliance, with respect to which the Tribunal cannot order costs, and suggests that the council, rather than the Tribunal, could not conceivably consider issuing a certificate of compliance in the Review proceeding. 
30	However, this is inconsistent with the council’s position both before and during the hearing, when it filed a joint statement of facts and then filed proposed minutes of consent for a certificate to issue. Despite the submissions made at the end of the hearing concerning the applicant’s inability to establish existing use rights based on the requirements of clause 63 of the Melton Planning Scheme, the council had previously filed submissions accepting that the evidence of the applicant showed the establishment of existing use rights for horse husbandry. The minutes of consent filed included a broader description of the existing use agreed. 
31	It is the case also that, whether or not the applicant provided insufficient description when filing the application with the council, the council did not request further information and failed to determine the application.
32	The Tribunal also accepts that the application for the certificate was made in the context of the applicant attempting to determine the parameters of use and development that required planning permission on the land. 
33	While this provides background, much of it is not relevant to the Tribunal consideration under section 109(3) of the VCAT Act which primarily concerns the way in which parties conduct themselves during a proceeding. 
34	It was the Tribunal that was not satisfied with the information provided in the Review proceeding, the Tribunal that provided the opportunity for additional evidence to be provided and the Tribunal that determined not to issue a certificate in the Review proceeding. 
35	It was also the Tribunal that asked for greater clarification at the outset of the hearing, given what appeared to be a general form of agreement between the parties as to the extent of existing use rights and the Tribunal’s questioning of whether there was, indeed, a dispute that needed to be resolved. 
36	The Tribunal is not persuaded that the conduct of either party during the Review proceeding meets the threshold that would be required to displace the general rule of parties bearing their own costs. Given the approach of both parties to the Review proceeding, the Tribunal does not consider that the other elements of section 109(3) are engaged. While it is the case that the Tribunal had several concerns with the evidence of the applicant and with the approach to determining the establishment of existing use rights to enable a certificate of compliance to be issued, it was only through the hearing of the Review proceeding that these matters could be considered. In considering the relative strengths of the existing use claim, we note that its deficiencies, particularly given the initial support, in part, of the council, were not clear prior to the hearing. It is not fair to award costs in circumstances where the hearing was required to consider and determine the application fully.
Declaration proceeding 
37	The way in which the application for declaration was framed, despite having been amended, was poor and unclear. It was also broad, to the extent of addressing irrelevant matters, and it is the case that the applicant did not address several elements of the application in either its written or oral submissions. It is also the case that the Tribunal provided several opportunities for the applicant to clarify or amend its application, without success.
38	The council, appropriately, addressed every element of the application in its extensive written submissions, which clearly took considerable time to prepare, at the cost of the council. The council submitted, as set out above, that it should be compensated for costs it was forced to incur to respond to a poorly conceived application with many elements that were not addressed and ultimately abandoned.
39	As with the Review proceeding, the Tribunal does not consider that the conduct of the applicant during the Declaration proceeding gives rise to an ability to order costs on the basis of section 109(3)(a), for the simple reason that we have not been persuaded that the applicant conducted the proceeding in a way that unnecessarily disadvantaged the council. The more relevant question is whether costs ought to be awarded having regard to the strength of the application made by the applicant and the way in which it was pursued, or for any other matter the Tribunal considers relevant.
40	The way in which the declaration was framed was poor and ultimately led to the Tribunal decision to refuse to make a declaration. 
41	However, the ability to apply for a declaration is open to an owner of land and we accept that, in making the application, the applicant was seeking a resolution to what it considered to be an ‘impasse’ with the council with respect to a continuing dispute concerning placement of fill within paddocks on the land.
42	As set out above, the Tribunal, historically, has not ordered costs for reason of a weak application alone. In this case, we accept that the applicant was seeking a resolution and see merit in having determined the proceeding with the ability for the issues to be raised and for the Tribunal to provide a response within its reasons, despite not making a declaration.
43	We understand that public funds were expended by the council in participating in this process and note that the Tribunal was greatly assisted by the participation of the council. 
44	Ultimately, having regard to the entirety of section 109 of the VCAT Act, we are not persuaded that the way in which the applicant conducted the proceeding, the nature of the proceeding or the weakness of the application is sufficient to displace the general rule that each party bears its own costs in a proceeding or that it would be fair to award costs.
Conclusion 
45	For the reasons provided above, the application for costs is refused.

J Perlstein
Presiding Member	M Deidun
Member