JV Co.8 Pty Ltd v Council of the City of Shellharbour [2024] NSWSC 1249 (17 September 2024)

Last Updated: 9 October 2024

Supreme Court New South Wales

Case Name:	JV Co.8 Pty Ltd v Council of the City of Shellharbour
Medium Neutral Citation:	[2024] NSWSC 1249
Hearing Date(s):	17 September 2024
Date of Orders:	17 September 2024
Decision Date:	17 September 2024
Jurisdiction:	Common Law
Before:	Garling J
Decision:	(1) Direct that lawyers for the parties are to confer and prepare agreed Short Minutes of Order on or before 9 October 2024. (2) If the parties are unable to agree upon the Short Minutes of Order then competing orders should be submitted to Chambers on or before 9 October 2024. (3) The determination of the appropriate orders will be dealt with on the papers. (4) Stand the proceedings over for directions before Garling J to 18 October 2024. If agreed consent orders are received by 14 October 2024, the matter will be removed from his Honour's list.
Catchwords:	CIVIL PROCEDURE – Discovery – Classes or categories of documents.
Legislation Cited:	Fair Trading Act 1987 Uniform Civil Procedure Rules 2005
Cases Cited:	Not Applicable
Texts Cited:	Australian Consumer Law
Category:	Principal judgment
Parties:	J V Co.8 Pty Limited (P) Council of the City of Shellharbour (D)
Representation:	Counsel: J King (P) D Priestley SC (D) Solicitors: Dentons Australia Pty Ltd (P) McCulloch & Buggy Lawyers (D)
File Number(s):	2023/305563
Publication Restriction:	Not Applicable

EX TEMPORE JUDGMENT

1. On 20 June 2024, the defendant filed a Notice of Motion seeking discovery pursuant to r 21.2(1)(a) of the Uniform Civil Procedure Rules 2005 (“UCPR”) of documents falling within 19 separately identified categories set out in Schedule A to the Motion.
2. The parties are agreed that Categories 9 and 14 are appropriate categories for discovery and that subject to a change of wording by deleting the word "relating" and inserting the word "relevant" in Categories 17, 18 and 19, there is no dispute that those categories describe documents proper for discovery.
3. According to the plaintiff’s submissions, putting the dispute brought before the Court in its Duty List, at its simplest, it is one where the defendant seeks in the remaining 14 categories, discovery of every document that ever existed about any form of the development which ultimately became an approved development, and everything which has occurred since.
4. Perhaps more realistically, the plaintiff submits that whilst the categories may properly describe a range of documents, they can be limited appropriately in a way which confines the categories to a subject matter which touched only upon the subject of flooding, overland flows and stormwater flows affecting the property or the water, sewerage, and stormwater drainage infrastructure installed in or found on the property or otherwise affecting it.
5. If I were to accept the defendant's submissions, the substantive effect of this restriction would be to so confine the categories for discovery as to make them effectively inutile. I have decided that as with many of these disputes, the position is somewhere between those two extremes.

Background Facts

6. Some background facts are necessary to be noted.
7. The Statement of Claim was filed on 26 September 2023. It relates to a parcel of land at Oak Flats, which was at all relevant times vacant and owned prior to 12 May 2017 by the defendant. The defendant prior to that date sought expressions of interest for the purchase of that property. Consequent upon the expressions of interest process, which commenced in June 2016, the plaintiff and defendant entered into a contract for the sale and purchase of the property on 12 May 2017.
8. About six months later on 23 November 2017, the plaintiff applied to the defendant for development consent in respect of the property. Ultimately on 28 June 2019, after various steps had been taken in the Land and Environment Court to reach an agreed position, that Court made orders granting development consent to the plaintiff's development application DA0580/2017 for the property (“the 2017 DA”). The judgment of the Land and Environment Court noted the particular conditions applicable to the 2017 DA.
9. It was a condition of the 2017 DA that prior to the release of the Construction Certificate, the detailed drainage design of the site must be submitted in accordance with the conditions which were approved. On 15 December 2021, the drainage design was certified pursuant to Condition 17 of the 2017 DA and consequently, about a month later, the Construction Certificate was issued including the drainage design.
10. Some preliminary works on the property were commenced on 18 January 2022. On 4 February 2022, the plaintiff and Quasar Constructions (Commercial) Pty Ltd (“Quasar”) entered into a design and construction contract for the property.
11. On or about 22 April 2022, Quasar informed the defendant by email that it had discovered, beneath the surface of the land, the existence of three stormwater pipes which were enabling water to flow onto the land and which was causing a delay to the works that were then underway. The plaintiff claims in the Statement of Claim that at no time prior to 22 April 2022 did it know of the existence of the stormwater pipes under the land, which it alleges were installed by the defendant at some time prior to 12 May 2017.
12. Based on that discovery, and the consequences of it, to which I will return, the plaintiff claims damages for two tortious causes of action by way of nuisance, negligent misstatement and also a statutory cause of action by way of misleading conduct contrary to the Fair Trading Act 1987 and the Australian Consumer Law insofar as it applies to a local council. It is said that the tortious conduct and the conduct constituting the statutory breach was the silence of the defendant in failing to reveal the fact and existence of the three stormwater pipes, and that such silence and failure to reveal the existence of the stormwater pipes is said to have been actionable as at the time that expressions of interest were first called for in 2016.
13. Insofar as either of the tortious or the statutory causes of action caused loss and damage to the plaintiff, the plaintiff claims damages by reason of three matters: namely, delays to the completion of the project as planned; particular variations which were made necessary to the 2017 DA by reason of the state of the land; and the remediation work which was necessary because of the existence of the council pipes and the discharge of water onto the property.
14. At paragraph 55 of the Statement of Claim, the plaintiff pleads that but for the defendant's conduct it would have known of the stormwater pipes and acted "as pleaded at [37]". Paragraph 37 pleads specifically with respect to the statutory cause of action, but in a way applicable to all causes of action, that had the plaintiff known about the existence, location and ownership of the council stormwater pipes it would have:

“(a) at all material times taken all steps necessary to accommodate the council pipes;

(b) applied to the defendant for development consent or amended its application for development consent in a manner that accommodated the council pipes;

(c) agreed to or obtained a decision in the development consent proceedings on terms that accommodated the council pipes; and

(d) otherwise proceeded with the development works in a manner that accommodated the council pipes."

Discernment

15. It seems to me that the issue between the parties can best be resolved by this Court indicating for the purposes of the current application for discovery which, I should note, does not of itself and without more purport to limit any future application that the defendant may wish to make for further and better discovery arising out of the discovery once given, by indicating some relevant parameters.
16. The first is this. It seems to me to be a relevant issue and one which is not limited in time other than by the date 15 June 2016 when the defendant issued an invitation for expressions of interest to acquire the property, and up until 22 April 2022, that the plaintiff either had knowledge of the existence of the council stormwater pipes and whether it, by itself or through its agents or contractors, made any investigations to establish the nature and characteristics of the land comprising the property and what lay below the surface and any flooding, overland flows or stormwater flows which affected the property, and the existence of any works which had by that stage been carried out on the property relating to the stormwater pipes which were later identified on 22 April 2022.
17. The second relevant issue which relates to the damages claimed is the entirety of the development project the subject of the 2018 DA, and the documents subsequently submitted to enable a construction certificate to issue on 11 January 2022. It is that development as approved in 2018 and incorporated in the planning documents, which provides the counterfactual, or alternatively put, the baseline, case for the plaintiff's claim for damages. That is so because it is said that the plaintiff's development was based on those proposals and that consent was delayed, needed to be varied and had additional work caused to it by reason of the discovery of the stormwater pipes. It seems to me that there should not be any restriction placed upon the discovery of those documents insofar as those documents are relevant to the counterfactual proposal which was to be implemented and in so far as work had been implemented prior to 22 April 2022.
18. The third issue which seems to me to be relevant is that the plaintiff ought be required to discover all documents relating to what has occurred since the discovery of the council stormwater pipes in so far as it relates to any matter touching upon the claimed losses, that is to say, delays, variations and remediation works. It seems to me, although I will leave it to the parties to decide, that Categories 17, 18 and 19 as amended would cover those particular matters of relevance.
19. In terms of any submission requiring documents containing communications with contractors, then it will be a matter for the discovering party to make a judgment as to whether that falls within the constraints which I have allowed save and except category 16, which relates to correspondence with SMEC Australia Pty Ltd. In my view having regard to the nature of the complaint said to give rise to the claim for damages, then I am satisfied that category 16 as proposed by the defendant is an appropriate category.
20. Each of the categories include the use of the term "all documents". It is unfortunate but understandable that the categories use the term "all documents". However, it seems to me that such a broad description is limited by the subparagraphs used in, for example, Category 3. In so far as the plaintiff contends that those subparagraphs are too wide, I do not agree. In my view those five subparagraphs are appropriate and act as a limitation on the use of the unfortunately broad term "all documents".
21. I have come to these views and express these remarks because it seems to me that from the pleadings the issues of substance in this proceeding, so far as the plaintiff giving discovery of documents to the defendant is concerned, are:

(1) What if anything did the plaintiff know about the land that it proposed to purchase for the purpose of carrying out the development for which it ultimately obtained consent.

(2) What investigations, if any, had it made about the nature, conditions and substratum of the land prior to the 2018 DA and afterwards.

(3) What it proposed to construct which it says was formulated on the basis of the absence of knowledge of the council stormwater pipes.

(4) What in fact happened as a consequence of the identification of the pipes so as to have an approved plan which accommodated the existence of the pipes, addressed the need for any other earthworks or drainage works and identifies the delay over and above that which would have occurred in the course of the approved development.

22. They are the relevant issues, and the plaintiff needs to give discovery of documents in its possession which touches upon all of those issues.
23. Against the background of the issues that were argued before me, I do not propose to go through each category indicating which of those should be re‑worded. That is a task which I will leave to counsel and direct that the lawyers for the parties confer and agree on a form of short minutes of order, which the Court can make within 21 days, failing which competing proposed consent orders should be submitted to my chambers, at which time I will consider whether the matter can be dealt with on the papers or else I will re-list the matter to hear any further argument.
24. Formally, I will note the order which I have just made about the submission.

Orders

25. I make the following orders:

(1) Direct that lawyers for the parties are to confer and prepare agreed Short Minutes of Order on or before 9 October 2024.

(2) If the parties are unable to agree upon the Short Minutes of Order then competing orders should be submitted to Chambers on or before 9 October 2024.

(3) The determination of the appropriate orders will be dealt with on the papers.

(4) Stand the proceedings over for directions before Garling J to 18 October 2024. If agreed consent orders are received by 14 October 2024, the matter will be removed from his Honour's list.

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