Mauger v Wingecarribee Shire Council (No. 2)

1. [1]

   On 31 July 2015 I provided my reasons for judgment in relation to the claims of the Plaintiff arising out of two series of complaints referred under the Council’s Code of Conduct to external reviewers: Mauger v Wingecarribee Shire Council [2015] NSWSC 1022. I found that the Plaintiff failed in relation to the first set of complaints (concerning the illegal dumping of material). In relation to the second set of complaints I found that the Plaintiff was successful in relation to only one of five of the individual matters. That matter concerned the claim for travel expenses of $700 in relation to a dinner at Condobolin. The Plaintiff was successful because he demonstrated that he had been denied procedural fairness in that the reviewer, subsequently to speaking to the Plaintiff, spoke with Council officers and obtained further information or comment from them: see at [101]-[105].

2. [2]

   Two issues need now to be determined. The first is the form of the declaration to be made in relation to the finding of procedural unfairness. The second concerns the costs of the proceedings.

The form of the declaration

1. [3]

   The Plaintiff’s proposed order is as follows:

2. [4]

   The Defendant’s proposed declaration is this:

3. [5]

   At the costs hearing on 14 August 2015 I indicated that I would make a declaration in the form that the Defendant sought. The declaration will be slightly modified for reasons that will appear. These are my reasons for doing so.

4. [6]

   Although the proceedings were in substance an application for judicial review of the reports of each of the Committees established to deal with the two subjects of complaints, the Plaintiff did not seek any orders in the nature of certiorari or mandamus. Rather, all that was sought were declarations. The purpose of the proceedings was said to be to vindicate the reputation of the Plaintiff. He was no longer a member of the Council and has not been a member since the Council elections on 8 September 2012.

5. [7]

   I note, however, that the declarations sought in the Amended Summons were these:

6. [8]

   The Plaintiff is not entitled to declarations in paragraphs 1A and 1B because I found against the Plaintiff that the decision to refer the complaint to the Reviewer was not made without jurisdiction and, therefore, that the investigation that she made was not without power. The only relevant declaration sought is that the Council's resolution of 23 November 2011 which adopted the Reviewer’s findings is null and void.

7. [9]

   There was one resolution in relation to the Reviewer’s report although it contained five paragraphs as follows:

8. [10]

   Two things may be noted about this resolution. First, this resolution dealt only with the Report of the Sole Reviewer in relation to the Mayor’s Complaint. I have never been provided with a copy of any resolution dealing with the Dumping Complaint, nor does the Amended Summons claim any relief in respect of such a resolution. Secondly, the evidence disclosed (Exhibit B) that the resolution was passed at the Council meeting on 16 November 2011 and not 23 November 2011 as was put to me in submissions at the first hearing, and as appears in the Amended Summons and the Plaintiff’s proposed declaration set out at [3] above. To that extent, paragraph [9] of the principal judgment should be corrected to refer to 16 November 2011.

9. [11]

   At the time the resolution was passed the Council did not know that the findings of the Reviewer in relation to the Condobolin dinner expenses were reached without according procedural fairness to the Plaintiff. There is no suggestion, however, that the resolution was not appropriately considered by the Council and passed by it.

10. [12]

    I have not quashed the findings of the Reviewer. In the first place, I was not asked to do so. Secondly, even if certiorari had been sought there would have been no basis to quash the whole of the report but only the identifiable section that concerned findings in relation to the Condobolin dinner expenses. Again, it is difficult to see that, even if the whole of the Reviewer’s report was quashed that that would make the Council’s resolution null and void. Certainly, where only one aspect of the Reviewer’s report was been successfully impugned, it cannot be said that the Council’s resolution is null and void.

11. [13]

    In Project Blue Sky v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 the joint judgment of McHugh, Gummow, Kirby and Hayne JJ discussed the appropriate test for the legal outcome of a breach of a statutory provision. Formerly, the distinction had been made between directory and mandatory requirements. The joint judgment said:

12. [14]

    Brennan J, although dissenting in the outcome, adopted a similar approach, saying:

13. [15]

    In the present case, the resolution of the Council was properly and validly passed according to proper procedures. To provide for a declaration that said the whole of the resolution was null and void would be inconsistent with the judgment of the Court that in all but one respect the report of the Sole Reviewer should stand.

14. [16]

    It is instructive to examine the terms of the Resolution in the light of the Court’s judgment. Paragraphs 1 and 2 merely note the contents of the Report. The acknowledgment by the Plaintiff in paragraph 3 is, in a sense, independent of the Report by reason of what appears at [108]-[110] of the principal judgment. In any event, the Report’s findings on this matter were not successfully challenged. As far as paragraph 4 is concerned, the Reviewer’s findings were not successfully challenged.

15. [17]

    It is only paragraph 5 that can be said to be affected by the principal judgment. What is provided for in the paragraph is now history. However, a declaration in the form to be made is a public qualification of paragraph 5 to the extent that the paragraph refers to unauthorised travel expenses. In circumstances where the Plaintiff’s concern was for his reputation a declaration in the terms put forward by the Defendant is both adequate and sufficient to restore his reputation in relation to the one matter where the sole reviewer was found to have erred by not according him procedural fairness.

16. [18]

    It cannot have been the intention of Parliament under the Local Government Act 1993 (NSW) that a resolution of Council adopting a Review Committee’s report would be null and void if it could be shown that some aspect of the Reviewer’s report was able to be impugned. The non-compliance in any regard by the Committee does not affect the ambit of Council’s power with respect to passing a resolution: Project Blue Sky at [41].

17. [19]

    The one modification to the Defendant’s proposed declaration is the insertion of the words “on and” after “investigation”. The Report makes clear that the Reviewer spoke with a WSC Councillor on 2 August 2011, that is, after the draft report was sent to the Plaintiff. The Defendant’s form of the declaration does not allow for the receipt of information on 2 August.

Costs

1. [20]

   The Plaintiff submitted that the Defendant should pay the Plaintiff’s costs of the proceedings. The Plaintiff submitted that he had been successful in establishing a denial of procedural fairness which vitiated the report of the Reviewer. This was because it was the critical finding in the dispute between the parties. The Plaintiff submitted that the applicable principle is that a court should award the costs of the proceedings to a successful party without attempting to differentiate between the issues on which the party succeeded and any issues on which the party failed. The Plaintiff said that a consistent theme of the cases is that justice may not be served if parties are dissuaded by the risk of costs from canvassing all issues which might be material to the decision in the case, in reliance on Hexiva Pty Ltd v Lederer (Costs) [2006] NSWSC 1259 at [9].

2. [21]

   The Plaintiff submitted that this was a case in which there were multiple legal issues, none of which was clearly dominant and none of which was severable so that the proper order is that costs ought simply follow the event. Since the Plaintiff was successful the Defendant should pay his costs.

3. [22]

   The Defendant submitted that the Court found in the Plaintiff’s favour on a discrete point in the Plaintiff’s claim in relation to allegation 1 in the second group of complaints. The Defendant referred to three principles identified by Toohey J in Hughes v Western Australian Cricket Association (Inc) [1986] ATPR 40, 748 at p 48,136 as follows:

4. [23]

   The Defendant submitted that if these principles were applied the Plaintiff failed in 90% of his claim. In those circumstances the Plaintiff should pay 90% of the Defendant's costs. The Defendant relied also on Thiess v TCN Channel Nine Pty Ltd (No 5) [1994] 1 Qd R 156 where the Full Court of the Supreme Court of Queensland said:

5. [24]

   Whether and to what extent it can be said that the Plaintiff was successful depends on an analysis of the claims the Plaintiff made. In the first place, as the principal judgment noted at [3]-[6] there were two sets of complaints. Further, as noted at [11] the Plaintiff claimed that both the investigations and the subsequent reports were invalid on four separate bases:

6. [25]

   In the result the Plaintiff failed entirely in relation to the first set of complaints. In relation to the second set of complaints, which involved five separate matters or allegations, the Plaintiff was successful on one ground only ([24](c) above) in respect of one of the matters or allegations. It is significant also that the complaint about procedural fairness in relation to the first set of complaints was an entirely different allegation to the complaint of procedural fairness in relation to the second set of complaints. The challenge to procedural fairness in relation to the first set of complaints was that the General Manager did not afford procedural fairness to the Plaintiff before he referred the Dumping Complaint to the Review Committee (see principal judgment at [28]). The consideration in relation to that alleged breach of procedural fairness involved entirely different considerations to the procedural fairness grievance in relation to the second lot of complaints (Cf [44]-[52] of the principal judgment with [75] and [97]-[118]). The procedural unfairness was at a completely different time in the process of referral of the complaint and report as between the two sets of complaints. Further, as I have already noted, the Plaintiff was only successful in relation to one of the five allegations in the second set of complaints.

7. [26]

   In my opinion, the Plaintiff’s use of the words “issue” and “issues” in his submissions obscures the real enquiry. There were four issues in relation to each of the two sets of complaints ([24] above). The two sets of complaints were not separate issues but separate factual matrices, as were the five separate allegations in the second set of complaints.

8. [27]

   Many, if not most, of the cases relied upon by the Plaintiff concerned disputes that involved a number of issues in the ordinarily understood sense of legal issues such as those in [24] above. The present case, as I have said, involved separate claims which had some common issues. However, even if the separate claims in the present matter could be regarded as separate issues the authorities tend to support the view that where there are discrete issues for determination and a party has succeeded on some but not all of those issues there may be an apportionment of the costs.

9. [28]

   In Waters v P C Henderson (Aust) Pty Ltd [1994] NSWCA 338; (1994) 254 ALR 328 Mahoney JA (with whom Kirby P and Priestley JA agreed) approved the following statement of principle in Ritchie’s Supreme Court Practice dealing with the power of the Court to order costs:

10. [29]

    That statement was expressly approved in James v Surf Road Nominees Pty Ltd (No 2) [2005] NSWCA 296 at [32].

11. [30]

    The Court of Appeal in James also approved Toohey J’s observations in Hughes ([22] above) and went on to say:

12. [31]

    In Permanent Trustee v FAI Hodgson CJ in Eq also said (at 13):

13. [32]

    In Hockey v Fairfax Media Publications Pty Ltd (No 2) [2015] FCA 750 White J surveyed many of the cases dealing with the apportionment of costs including those already mentioned in this judgment. I accept that both Hockey and Thiess were both defamation cases and costs principles in those cases may not always coincide with common law principles particularly because of a legislated approach (see s 40 Defamation Act 2005 (NSW)). Nevertheless, what was said in Thiess seems to me to be consistent with what Toohey J said in Cretazzo v Lombardi and the principles established in Waters and in James.

14. [33]

    The Defendant rightly points out that the matter on which the Plaintiff succeeded took a very small period of time to argue and to articulate. It is referred to only in paragraph 15(c) of the Plaintiff’s Amended Grounds of Review and is referred to only at [32] of the Plaintiff’s written submissions and paragraph [48] of the Defendant’s written submissions. In addition, the point was argued over only four of 55 pages of transcript, two for the Plaintiff and two for the Defendant.

15. [34]

    The principal issues argued at the hearing and in the written submissions related to the Code of Conduct (both its relationship to what the Plaintiff was alleged to have done and whether its provisions had been complied with), the notion of functus officio for the referral of the Mayor’s Complaint and procedural fairness in relation to the referral of the Dumping Complaint. The Plaintiff was unsuccessful on all of those issues.

16. [35]

    There is one further matter to mention. The Summons filed by the Plaintiff on 21 August 2012 was only concerned with the report of the Conduct Review Committee dated 27 April 2012 in relation to the Dumping Complaint. The first time the Mayor’s complaint, which included the Condobolin dinner expenses, was raised was in a Notice of Motion dated 7 January 2013 which sought leave to amend the Summons to claim declarations in respect of the report of the sole reviewer.

17. [36]

    The final result for the Plaintiff was that he succeeded on one legal issue in relation to one out of six complaints that were investigated. So far from this being substantial success for the Plaintiff it was only a small vindication, and in circumstances where it could not be positively shown that the Plaintiff had been denied procedural fairness – only that it may have occurred because the Reviewer did not make clear if she had relied on any material obtained after she last put matters to the Plaintiff on that one allegation.

18. [37]

    A division of costs following the Thiess approach would suggest that the Plaintiff ought to pay about 80% of the Defendant’s costs. However, I consider that some weight needs to be given to the fact that it was necessary for the Plaintiff to pursue proceedings (even if many matters should not have been litigated) to achieve a partial vindication of his reputation.

19. [38]

    In all of the circumstances the Plaintiff should pay 50% of the Defendant’s costs of the proceedings.