Court Denies Defendant’s Request for Professional Costs After Prosecution Withdrawal

The court dismissed a defendant's motion seeking professional costs after the prosecution was withdrawn. The decision emphasises that to be awarded such costs, the prosecutor must have acted unreasonably or improperly, which was not established in this case.

OUTCOME: Dismissed

Land and [ADDRESS] South Wales

Medium Neutral Citation: Secretary, Department of Planning and Environment v [COMPANY] (No 7) [2022] NSWLEC 83 Hearing dates: 21 June 2022 Decision date: 07 July 2022 Jurisdiction: Class 5 Before: Pain J Decision: The Defendant's notice of motion dated 10 June 2022 is dismissed. Catchwords: COSTS – defendant seeks costs order following withdrawal of prosecution Legislation Cited: Criminal Procedure Act 1986 (NSW), ss 247K, 257A, 257C, 257D, 257G Justices Act 1902 (NSW) (repealed), s 81 Native Vegetation Act 2003 (NSW) (repealed), s 42 Cases Cited: Environment Protection Authority v [COMPANY] (No 2) (2014) 202 LGERA 203; [2014] NSWLEC 70 [NAME] v Director of Public Prosecutions [1999] NSWSC 367 [COMPANY] v Sprowles (2001) 52 NSWLR 705; [2001] NSWCA 305 Minister for Immigration and Border Protection v SZVFW (2018) 264 CLR 541; [2018] HCA 30 [NAME] v [NAME]; [NAME] v [NAME] (No 2) [2021] NSWLEC 18 Pittwater Council v [COMPANY] (No 3) (2009) 165 LGERA 6; [2009] NSWLEC 21 Port Macquarie-Hastings Council v [COMPANY] (No 7) (2008) 139 LGERA 87; [2008] NSWLEC 75 Secretary, Department of Planning and Environment v [COMPANY] (No 2) [2022] NSWLEC 56 [NAME] v [NAME] on behalf of the Department of Environment and Climate Change (2010) 181 LGERA 352; [2010] NSWCCA 292 Category: Costs Parties: Secretary, Department of Planning and Environment ([NAME]) [RESPONDENT] (Defendant) Representation: Counsel: [redacted] J Ireland QC with [COUNSEL] (Defendant)

Solicitors: [redacted] [NAME] (Defendant) File Number(s): 19/81751

Judgment on costs 1. The Defendant was charged with an unlawful clearing offence under the Native Vegetation Act 2003 (NSW). The [NAME] withdrew the charge of unlawful clearing on 6 June 2022 following an evidentiary ruling of 17 May 2022 in Secretary, Department of Planning and Environment v [RESPONDENT] (No 6) [2022] NSWLEC 62 (Namoi Valley No 6). The Defendant has filed a notice of motion dated 10 June 2022 seeking an order that its professional costs be paid by the [NAME]. Section 257C(1) applies as the charge was withdrawn.

2. The Defendant is not alleging any impropriety by the [NAME]. At issue is whether the [NAME] acted unreasonably, in several respects.

3. The following provisions of the Criminal Procedure Act 1986 (NSW) (CP Act) are relevant to this costs application: Part 5 Summary jurisdiction of Supreme Court and other higher courts … Division 4 Costs 257A Definition In this Division— professional costs means costs (other than court costs) relating to professional expenses and disbursements (including witnesses' expenses) in respect of proceedings before a court. … 257C When professional costs may be awarded to accused person (1) A court may at the end of proceedings under this Part order that the [NAME] pay professional costs to the registrar of the court, for payment to the accused person, if the matter is dismissed or withdrawn. (2) The amount of professional costs is to be such professional costs as the court specifies or, if the order directs, as may be determined under section 257G. (3) Without limiting the operation of subsection (1), a court may order that the [NAME] in proceedings under this Part pay professional costs if— (a) the accused person is discharged as to the offence the subject of the proceedings, or (b) the matter is dismissed because the [NAME] fails to appear, or (c) the matter is withdrawn or the proceedings are for any reason invalid. 257D Limit on award of professional costs against a [NAME] acting in a public capacity (1) Professional costs are not to be awarded in favour of an accused person in proceedings under this Part unless the court is satisfied as to one or more of the following— (a) that the investigation into the alleged offence was conducted in an unreasonable or improper manner, (b) that the proceedings were initiated without reasonable cause or in bad faith or were conducted by the [NAME] in an improper manner, (c) that the [NAME] unreasonably failed to investigate (or to investigate properly) any relevant matter of which it was aware or ought reasonably to have been aware and which suggested either that the accused person might not be guilty or that, for any other reason, the proceedings should not have been brought, (d) that, because of other exceptional circumstances relating to the conduct of the proceedings by the [NAME], it is just and reasonable to award professional costs. … 257G Calculation of costs The professional or other costs payable by a [NAME] or accused person in accordance with an order directing that the amount of costs is to be determined under this section are to be determined— (a) by agreement between the [NAME] and accused person, or (b) if no such agreement can be reached, in accordance with the legal costs legislation (as defined in section 3A of the Legal Profession Uniform Law Application Act 2014) (with or without modifications prescribed by the regulations).

1. Professional costs are defined as set out above. It is not disputed that the [NAME] was working in a public capacity for the purposes of s 257D of the CP Act.

2. The Defendant must satisfy the Court of an entitlement to costs under s 275C of the CP Act and bring themselves within one or more of the circumstances in s 257D(1) of the CP Act: [NAME] v [NAME] on behalf of the Department of Environment and Climate Change (2010) 181 LGERA 352; [2010] NSWCCA 292 ([NAME]) at [68]. Every case depends on its own facts.

Chronology 1. The [NAME] provided a short chronology in written submissions to which I have added to include all relevant events referred to by the parties in argument.

2. On 6 March 2019 an expert report of [NAME] [NAME] [NAME] was finalised.

3. On 13 March 2019 an expert report of [NAME] [NAME] [NAME] was finalised.

4. On 14 March 2019 the [NAME] commenced proceedings.

5. On 16 March 2019 the statutory time bar on commencement of proceedings came into effect under s 42(4) of the Native Vegetation Act 2003 (NSW).

6. On 28 June 2019 [NAME] [NAME] second expert report was finalised.

7. On 9 August 2021 the Defendant's notice under s 247K of the CP Act was served on the [NAME] notifying an in globo objection to the reports of [NAME] [NAME] and [NAME] [NAME] [NAME].

8. On 21 September 2021 the Court ordered that the Defendant provide its objections to the [NAME] by 28 March 2022 (MFI-1). This order was not complied with by the Defendant.

9. On 8 April 2022 the [NAME] filed a notice of motion seeking leave to rely upon the additional reports of [NAME] [NAME] (dated 21 March 2022) and [NAME] [NAME] [NAME] (dated 5 April 2022).

10. On 26-27 April 2022 the pre-trial hearing of the Defendant's notice of motion dated 8 April 2022 occurred.

11. On 28 April 2022 the pre-trial hearing of the [NAME]'s notice of motion dated 8 April 2022 occurred. On 29 April 2022 I refused the [NAME]'s notice of motion seeking to rely on the additional reports of [NAME] [NAME] and [NAME] [NAME] [NAME] in Secretary, Department of Planning and Environment v [COMPANY] (No 2) [2022] NSWLEC 56 ([NAME]).

12. On 4 May 2022 the trial proper commenced. On 4 May 2022 the [NAME] received objections articulating grounds on which the Defendant objected to individual paragraphs in [RESPONDENT] report.

13. On 12 May 2022 the [NAME] received further objections articulating the grounds of objection including of failure to disclose the method of interpretation for identification of alleged clearing, the ground ultimately upheld in Namoi Valley No 6.

14. On 13 May 2022 the [NAME] tendered the March 2019 and June 2019 reports of [NAME] [RESPONDENT].

15. On 13 and 16 May 2022 the hearing of the Defendant's objections proceeded.

16. On 17 May 2022 I delivered oral reasons upholding objections to various paragraphs of [NAME] [NAME] first report in which he opined as to clearing on subject land having occurred in the charge period by reference to [NAME] images he compared.

17. On 18 May 2022 I provided my written reasons in Namoi Valley No 6. The [NAME] applied for an adjournment so that it could consider its position in light of the judgment. The adjournment was granted.

18. On 31 May 2022 the [NAME] notified the Defendant that it proposed to withdraw the charge when the matter resumed on 6 June 2022.

19. On 2 June 2022 the [NAME] notified the Court that it proposed to withdraw the charge when the matter resumed on 6 June 2022.

20. On 6 June 2022 the [NAME] withdrew the charge.

Evidence 1. The affidavit of [NAME] [NAME] sworn 10 June 2022 attests to the quantum of professional costs incurred by the Defendant in the proceedings and when these were incurred. 2. [NAME] [NAME] was briefly cross examination by reference to a document showing an email exchange between the [NAME] and Defendant in which, as [NAME] [RESPONDENT] confirmed, the [NAME] notified the Defendant of its intention to withdraw the summons on 31 May 2022 and asked for the Defendant's consent to notify the Court of that intention.

Defendant's submissions 1. The Defendant relies on s 257D(1)(a), (b), (c), and (d) of the CP Act on the basis of unreasonableness on the [NAME]'s part (not alleging improper conduct in so far as that concept appears in s 257D(1) of the CP Act). 2. [NAME] [NAME] first report of 2019 and [NAME] [NAME] [NAME]'s report of 2019 were the basis for the [NAME]'s case and critical to proof of the charges laid. Their work was the core of the investigation carried out by the [NAME] and they were the instruments of the investigation which resulted in a charge being laid. These reports were in existence before proceedings were commenced, signed off and available from 14 March 2019. The deadline for commencing proceedings expired on 6 March 2019. [NAME] [NAME] is not an employee of the [NAME] he is an instrument of investigation whose techniques and methodology were inadequate and this should have been obvious on the face of the reports to the lawyers for the [NAME] before proceedings were commenced. Self-evidently the reports were inadequate.

3. That the [NAME] sought to rely on an additional report of [NAME] [NAME] which was partly the subject of [NAME] less than three weeks before the scheduled commencement of the trial reinforces the view that [NAME] [NAME] reports were deficient. The matter became beyond doubt when the application to rely on the additional report was refused on 29 April 2022 in [NAME].

4. The circumstances of the late commencement of the prosecution close to the statutory time bar date, the recent receipt before that date of [NAME]' report which must have been reviewed by the [NAME]'s lawyers, give rise to an inference that the [NAME] commenced proceedings cognisant of the risk of the inadequacy of [NAME] [NAME] reports. Objectively considered what was done was unreasonable. These same circumstances establish that s 257D(1) paragraphs (a)-(d) all apply.

5. Section 257D(1)(a) applies as the investigation into the alleged offence was conducted in an unreasonable manner.

6. Section 257D(1)(b) applies as the proceedings were initiated without reasonable cause. This is for the same reasons as previously identified regarding the role and consideration of [NAME] [NAME] reports.

7. Section 257D(1)(c) also applies in that the [NAME] unreasonably failed to investigate (or investigate properly) any relevant matter of which it was aware or ought reasonably to have been aware and which suggested for any other reason that the proceedings should not have been brought. The other reason in this case was that the [NAME] was aware or ought reasonably to have been aware that [NAME] [NAME] reports were deficient in the sense recognised in Namoi Valley No 6.

8. Section 257D(1)(d) also applies because there were exceptional circumstances relating to the conduct of the proceedings by the [NAME] making it just and reasonable to award professional costs. The exceptional circumstances were the same circumstances as previously mentioned. The [NAME] should have withdrawn the summons at the latest by 29 April 2022 when [NAME] was decided. Instead the [NAME] prolonged the already expensive and lengthy proceedings by commencing the trial.

9. Replying to the [NAME]'s submission that unreasonableness in s 257D(1) is to be equated with unreasonableness in the administrative law sense (see below in [39]), the Defendant submitted that there is no basis for such an equation. The bar for unreasonableness in s 257D(1) is lower than in judicial review proceedings, being whether, objectively viewed, in all the circumstances, the conduct in the particular case was unreasonable.

10. In response to the [NAME]'s submissions summarised below in [46], the Defendant identified in the transcript of 26 April 2022 references where the Defendant submitted the [NAME] expressed an awareness that the Defendant was objecting to the whole of the original reports of [NAME] [NAME] and [NAME] [NAME] on the grounds identified in [COMPANY] v Sprowles (2001) 52 NSWLR 705; [2001] NSWCA 305 ([NAME]).

[NAME]'s submissions 1. No basis for any of the circumstances in s 257D(1) applying has been made out by the Defendant.

2. In relation to the claim that the [NAME] acted unreasonably generally, the [NAME] submitted that it acted entirely reasonably in considering and relying on [NAME] [NAME] expert reports. Unreasonableness in the context of 257D(1) is to be equated with unreasonableness in the administrative law sense. A decision can be legally unreasonable when it lacks an evident and intelligible justification: Minister for Immigration and Border Protection v SZVFW (2018) 264 CLR 541; [2018] HCA 30 at [10], [59] and [82].

3. In relation to s 257D(1)(a), the Defendant does not even clear the first hurdle because it does not explain how the shortcoming of [NAME] [NAME] reports meant that the "investigation" into the alleged offence was conducted in an unreasonable manner. There is an important distinction between the investigation and the preparation of evidence for a hearing. A failure to interview a critical eyewitness may constitute an investigation conducted in an unreasonable manner: Pittwater Council v [COMPANY] (No 3) (2009) 165 LGERA 6; [2009] NSWLEC 21 (A1 Professional) at [15c]. An investigation may not be unreasonable, yet evidence for the trial may be deficient: A1 Professional at [19]. [NAME] [NAME] reports were not part of the investigation of the offence. [NAME] [NAME] reports were prepared to collect evidence for the proceedings. Alternatively, if [NAME] [NAME] writing of reports was part of an investigation it would be a misuse of language to describe his omission to disclose his method of interpretation of alleged clearing as part of the investigation.

4. Proceedings will be instituted without reasonable cause within the meaning of s 257D(1)(b) if objectively assessed on the facts or the facts apparent at the time of initiating the proceedings, they had no real prospects of success or were doomed to failure: A1 Professional at [15]. The test turns upon the facts as known to the [NAME], not the evidence: A1 Professional at [13]. The [NAME] relied on the propositions identified by me at [88]-[89] in [NAME] v [NAME]; [NAME] v [NAME] (No 2) [2021] NSWLEC 18 ([NAME]).

5. The Defendant did not identify any facts which suggested the proceedings were instituted without reasonable cause.

6. Contrary to the Defendant's submission that the [NAME] recognised the deficiencies in [NAME] [NAME] first report as evidenced by its application for leave to rely on an additional report, the [NAME] relied on [NAME] [NAME] additional report to respond to criticisms of the first [RESPONDENT] report by the Defendant's expert [NAME] [RESPONDENT] [NAME], as recorded by the Court in [NAME] at [11], [21]. The additional report the subject of Namoi No 2 was not brought forward for the purpose of 'curing' deficiencies in the [NAME] [NAME] 2019 reports and did not address those deficiencies. The additional report was not allowed because it would cause irredeemable prejudice to the Defendant.

7. Section 257D(1)(c) is not made out. Even if the shortcomings of [NAME] [NAME] reports were part of the investigation (which is denied for the same reasons as above in relation to s 257D(1)(a)), a shortcoming in the investigation does not amount to a failure to investigate a relevant matter. The Defendant does not and has no basis to suggest that there was a relevant matter which suggested it might not be guilty or that for any other reason the proceedings should not have been brought.

8. Section 257D(1)(d) does not apply. This paragraph requires that the Defendant establish something about the conduct of the proceedings which is an exceptional circumstance, meaning out of the ordinary or unusual, other than some matter arising in relation to paragraphs (a)-(c), to make it just and reasonable for it to obtain costs: [NAME] v Director of Public Prosecutions [1999] NSWSC 367 ([NAME]) at [30] (Wood CJ at CL in an application for judicial review of a magistrate's decision not to award costs under the equivalent provision in s 81 of the Justices Act 1902 (NSW), considered the expression "other exceptional circumstances"). Plainly this could not be satisfied if the circumstances establish one of the other three limbs of the subsection. In any case, this paragraph relates to the conduct of proceedings not something which occurred or did not occur before the proceedings were initiated, and [NAME]' first report was written on 6 March 2019 before the commencement of proceedings. There is no other exceptional circumstance relating to the conduct of proceedings and even if there were, the Court would not be satisfied that it was just and reasonable to award costs.

9. The [NAME] also emphasised the very late notification on 12 May 2022 by the Defendant of the objection which was heard on 13 May 2022 and ultimately successful in Namoi Valley No 6, delivered on 17 May 2022.

Consideration 1. [ADDRESS] must be satisfied that one or more of the subsections in s 257D(1) are met in order for an order for costs in favour of the Defendant to be made with the onus of achieving that satisfaction resting with the Defendant. The Defendant has incurred costs and their quantum is not material at this stage given that s 257G of the CP Act allows the Court to order costs as agreed or assessed. Subsections (1)(a) and (c) concern the investigation of an offence. Subsection (1)(b) concerns the initiation of proceedings and their conduct. Subsection (1)(d) concerns exceptional circumstances (not otherwise covered by earlier subsections).

2. By way of general overview of how events transpired based on the chronology set out above in [7]-[25] the Defendant notified its detailed objections to [NAME] [RESPONDENT] reports late, well after the timeframe specified in the September 2021 Court order made for preparation of the matter for trial. The Defendant had the benefit of the Court nevertheless allowing its objections to be heard. The objection to the whole report on the basis of absence of demonstration of methodology was notified only the day before the hearing on that matter being on 12 May 2022. Similar objections to a number of paragraphs were specified in the Defendant's list of objections dated 4 May 2021. The [NAME] was not on notice earlier of any fundamental flaws in [NAME] [RESPONDENT] reports. While the Defendant relied on a transcript reference identifying that the [NAME] had knowledge of the Defendant's [RESPONDENT] objection broadly on 26 April 2022 that was not the focus of the notice of motion then being heard and in any case the transcript references provided read in context only show awareness by the [NAME] of a [NAME] objection in relation to [NAME] [NAME] [NAME]'s report, not [NAME] [NAME]. The notice of motion dated 8 April the subject of [NAME] did not demonstrate that the [NAME] was on notice of the deficiencies in [NAME] [NAME] reports the subject of Namoi Valley No 6. It was not apparent that the prosecution should have been withdrawn at the date of the judgment in [NAME], contrary to the Defendant's submissions to that effect.

3. The inadequacies in [NAME] [RESPONDENT] reports are not self-evident contrary to the Defendant's submissions. That the Defendant's objection was upheld in key respects in Namoi Valley No 6 does not render a matter self-evident.

4. While the [NAME] made submissions summarised above in [39] to the effect that unreasonableness should or can be assessed by reference to the standard applicable in a judicial review context, such an approach does not appear warranted in these circumstances and adds unnecessary complexity to the task. No authority was cited in the criminal context suggesting such an approach is warranted. The reasonableness of the [NAME]'s actions can be assessed objectively by the Court mindful of the ethical and legal obligations of a [NAME] commencing and conducting criminal proceedings.

5. In relation to s 257D(1)(a), for the reasons given by the [NAME] [NAME] [NAME] report preparation was not part of the investigation of whether an offence had been committed and their preparation was not therefore 'caught' by that section. His reports were prepared for the purpose of giving evidence for the commencement of proceedings, a different phase to an investigation into whether an offence has been conducted. The Defendant has not otherwise identified any failure in the investigation undertaken, as would be required by the principles I identified in Environment Protection Authority v [COMPANY] (No 2) (2014) 202 LGERA 203; [2014] NSWLEC 70 (Bulga Coal Management No 2) and has not satisfied the Court in that regard for the purposes of subs (1)(a).

6. Having relied solely on [NAME] [RESPONDENT] reports not being admitted, the Defendant has failed to establish that s 257D(1)(c) ought to apply in that there was no demonstrated failure to investigate or investigate properly any matter the [NAME] ought to have been aware of which suggested the Defendant might not be guilty inter alia. The [NAME]'s submission above in [44] is accepted.

7. In relation to s 257D(1)(b), in [NAME] I found as follows at [88]-[89]:

88. Proceedings will be instituted without reasonable cause if, objectively assessed on the facts apparent at the time of initiating the proceedings, they had no real prospects of success or were doomed to failure: Council of Kangan Batman Institute of Technology and [NAME] v [NAME] Commission (2006) 156 FCR 275; [2006] FCAFC 199 at [60]; [NAME] v [NAME] (1992) 43 IR 257; [1992] FCA 539 ([NAME]) at 264. The failure of proceedings does not mean that the proceedings were initiated without reasonable cause: Pittwater Council v [COMPANY] (No 3) (2009) 165 LGERA 6; [2009] NSWLEC 21 (A1 Professional Tree Recycling) at [10], [14] and [15(a)]; R v [NAME]; Ex parte Federated Miscellaneous Workers' Union of Australia (1978) 140 CLR 470; [1978] HCA 51 at 473: Wollongong City Council v [COMPANY] (No 9) [2008] NSWLEC 248 at [9].

89. If success depends upon the resolution in the [NAME]'s favour of one or more arguable points of law, it is inappropriate to stigmatise the proceeding as being "without reasonable cause". But where, on the [NAME]'s own version of the facts, the proceeding must clearly fail, it may properly be said that the proceeding lacks reasonable cause: Canceri v Taylor (1994) 123 ALR 667 at 676 where [NAME] adopted the approach of [NAME] in [NAME] at 264.

1. The allegation made is that the initiation of proceedings was without reasonable cause because the Defendant later successfully objected to important parts of the [NAME]'s evidence. That a prosecution is discontinued is not a basis for an award of costs under s (1)(b): [NAME] No 2 at [88]; A1 Professional at [10]. The circumstance relied on without more does not justify the application of subs (1)(b).

2. No definition of exceptional is provided in s 257D(1)(d) and its ordinary meaning can be applied of 'unusual', 'extraordinary': Port Macquarie-Hastings Council v [COMPANY] (No 7) (2008) 139 LGERA 87; [2008] NSWLEC 75 at [75]; Bulga Coal Management No 2 at [76]. The [NAME] correctly submits relying on [NAME] that a circumstance enlivening subs (a)-(c) cannot enliven subs (d) given the words "other exceptional circumstances". In any case as the [NAME] identified, subs (1)(d) refers to the conduct of proceedings. There is nothing exceptional about the circumstances of the conduct of proceedings by the [NAME] in relation to reliance on [NAME] [NAME] reports. I have already found that any failure in these was not self-evident. That [NAME] [NAME] reports were central to the [NAME]'s case does not make these circumstances exceptional and the conduct of proceedings by the [NAME] does not warrant the application of ss (1)(d).

Orders 1. The Defendant's notice of motion dated 10 June 2022 is dismissed.

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