Central Coast Council v Minister Administering the Crown Land Management Act 2016 (No 2)

On 20 March 2026, I delivered judgment in this matter concerning the validity of a decision taken by a delegate of the first defendant, the Minister administering the Crown Land Management Act 2016 (NSW), on 14 February 2024 to enter into a Settlement Agreement with the third defendant, Mr Darcy Smith, by which the Minister agreed to settle proceedings that had been commenced by Mr Smith in 2023 seeking specific performance of what was said to be a binding agreement reached on 23 April 2020 to sell to him part of the Land comprising part of a Crown road known as Bakali Road, Forresters Beach NSW in 15 lots for a price of $33,850: see Central Coast Council v Minister Administering the Crown Land Management Act 2016 [2026] NSWSC 238.

Under the terms of the Settlement Agreement the Minister agreed to sell the Land in 15 lots to Mr Smith for $195,000 subject to certain conditions. I held that the Minister did not have power to enter into the Settlement Agreement on those terms because the subdivision of the Land into 15 lots was not necessary for the Land to be sold and therefore the subdivision could only occur with development consent obtained in accordance with the Environmental Planning and Assessment Act 1979 (NSW). I also held that even if the Minister had power to enter into the Settlement Agreement an essential condition of the agreement — namely, the agreement of the plaintiff, Central Coast Council, to the terms of an easement over the Land in its favour — could not be satisfied, with the result that Mr Smith was not entitled to specific performance of the Settlement Agreement.

Consistently with orders made by the Court on 5 December 2025, I did not deal with the question whether Mr Smith was entitled to recover damages for breach of the Settlement Agreement or with an alternative case advanced by Mr Smith that if he was not entitled to enforce the Settlement Agreement, he was entitled to sue on the agreement made on 23 April 2020. I directed that the parties bring in short minutes of order to give effect to the conclusions of my judgment and any agreement in relation to costs and, to the extent that they could not agree, to provide my Associate with a form of orders each party sought and a short outline of written submissions setting out why the Court should make those orders. I stood the matter over until 24 April 2026.

The parties agreed on some of the orders that should be made to give effect to my earlier judgment and I made other orders on 24 April 2026 to deal with the outstanding issues between them. The only issue that remains is the costs orders that should be made in relation to the Council’s claim. This judgment deals with that issue. It assumes familiarity with my earlier judgment and adopts the same abbreviations as used in that judgment.

Two issues arise in relation to the costs of the Council’s claim. The first is what proportion of its costs the Council should recover. The second is whether the Council should be entitled to recover its costs from Mr Smith as well as the Minister.

The Council maintains that it was successful in obtaining an order quashing the 2024 Decision to enter into the Settlement Agreement and that in accordance with Uniform Civil Procedure Rules 2005 (NSW) (UCPR) r 42.1, costs ought to follow the event. On the other hand, the Minister submits that the Council raised six grounds of review, it was successful in relation to only one which itself was only raised as a result of an amendment, the grounds were clearly separable and therefore the Court should in its discretion and applying a broadbrush approach only permit the Council to recover 30% of its costs: see Zurich Australian Insurance Limited v Cimic Group Limited (No 2) [2024] NSWCA 276 at [7]-[8].

I accept the submissions made on behalf of the Minister. The Council submits that the gravamen of its complaint which led to the commencement of proceedings was that it was the Delegate’s decision to enter into the Settlement Agreement that entailed a subdivision of the Land where no such subdivision was otherwise permissible under the applicable environmental planning instruments and legislation. So much may be accepted. However, that does not alter the fact the Council by its claim raised a substantial number of other issues which required a more detailed investigation of the facts and which the Minister was required to address and on which the Council lost. Indeed, the point on which the Council succeeded — that the Minister did not have power to enter into the Settlement Agreement because it provided for a subdivision that was not permitted by the relevant planning instruments and legislation — only clearly emerged during the course of the hearing. In those circumstances, it is appropriate that the Council only recover a proportion of its costs. Applying a broadbrush approach, 30% appears to be a reasonable proportion having regard to the number of issues raised by the Council and the additional complexity of the case that resulted from them.

As to the question whether Mr Smith as well as the Minister should be liable for those costs, I have concluded that he should be. Mr Smith submits that he should not be because, in effect, he did no more than adopt the position of the Minister and he could not have consented to the orders sought by the Council because of his separate claim against the Minister. However, in my opinion, that is not a fair characterisation of the position. It was Mr Smith who insisted that the Land be sold to him in 15 lots. Implicit in that position is that the Minister had power to do so. It was in that context that he actively resisted the orders sought by the Council and, for example, objected to amendments sought by the Council to its claim. The fact that ultimately Mr Smith was largely content to rely on the Minister’s submissions in relation to the Council’s claim does not alter the position.

The Minister proposes that the Council’s costs should be shared equally between the Minister and Mr Smith. I agree with that submission. In the normal course of events, the costs order would be made against both the Minister and Mr Smith, the Council could recover its costs from either and if it recovered its costs from one, that party would be entitled to claim contribution from the other. Since they would be equally liable, the amount of contribution that one would be entitled to recover from the other would be 50%. In the circumstances of this case, it seems sensible that the costs order reflect that ultimate outcome.

Accordingly, I make the following order: