Planning and Environment Minister v Yates, Yates (Née Van Neste) and R’S Skips Ltd

JurisdictionJersey
CourtCourt of Appeal
JudgeSteel, McNeill and Montgomery, JJ.A.
Judgment Date27 November 2008
Date27 November 2008
COURT OF APPEAL
Steel, McNeill and Montgomery, JJ.A.
née

S.C.K. Pallot for the Minister;

R.L. Pinel, Director of the second respondent, in person;

The first respondents did not appear and were not represented.

Cases cited:

(1) Aiden Shipping Co. Ltd. v. Interbulk Ltd., [1985] 1 W.L.R. 1222; [1985] 3 All E.R. 641; [1986] 1 Lloyd's Rep. 107; on appeal, [1986] A.C. 965; [1986] 2 All E.R. 409; [1986] 2 Lloyd's Rep. 117; (1986), 130 Sol. Jo. 429, applied.

(2) Dolphin Quays Devs. Ltd. v. Mills, [2008] 1 W.L.R. 1829; [2008] Bus. L.R. 1520; [2008] 4 All E.R. 58; [2008] BCC 471; [2008] EWCA Civ 385, applied.

(3) Drake (née Neville) v. Gouveia, 2000 JLR 411, applied.

(4) Dymocks Franchise Systems (NSW) Pty. Ltd. v. Todd, [2004] 1 W.L.R. 2807; [2005] 4 All E.R. 195; [2005] Costs L.R. 52; [2004] UKPC 39, applied.

(5) Fairfax (John) & Sons Pty. Ltd. v. E.C. de Witt & Co.(Australia) Pty. Ltd., [1958] 1 Q.B. 323; [1957] 3 W.L.R. 877; [1957] 3 All E.R. 410, referred to.

(6) Forbes-Smith v. Forbes-Smith, [1901] P. 258, referred to.

(7) Gore v. Justice Corp. Pty. Ltd., [2002] FCA 354; (2002), 189 ALR 712, distinguished.

(8) Pritchard v. J.H. Cobden Ltd., [1988] Fam. 22; [1987] 2 W.L.R. 627; [1987] 1 All E.R. 300; [1987] 2 FLR 30, distinguished.

(9) Symphony Group PLC v. Hodgson, [1994] Q.B. 179; [1993] 4 All E.R. 143, applied.

Legislation construed:

Civil Proceedings (Jersey) Law 1956 (Revised Edition, ch.04.200), art. 2(1): The relevant terms of this paragraph are set out at para. 11.

Planning and Building (Jersey) Law 2002 (Revised Edition, ch.22.550, 2008 ed. (2009 Reissue)), art. 19(2): The relevant terms of this paragraph are set out at para. 39.

art. 19(7): The relevant terms of this paragraph are set out at para. 36.

Civil Procedure—costs—costs against non-party—no limit to power to award costs under Civil Proceedings (Jersey) Law 1956, art. 2(1), but exercised with reason and justice in fact-specific cases—order against non-party normally unjust—not generally ordered against mere funder of action, i.e. if no personal interest, or if costs not caused by non-party's involvement—costs of action for breach of voisinage after grant of planning permission for change of use of property not properly ordered against P & E Minister if no encouragement of breach and no connection with action, i.e. no funding, direction or participation and no benefit from outcome

The first respondents brought an action against the second respondent in the Royal Court in voisinage.

When the first respondents had bought their home in 1999, the neighbouring property had been a dairy farm. Planning permission was granted in 2002 for a change of use of certain farm buildings from redundant dairy buildings to dry storage and, in 2005, further permission was granted for a change of use from dry storage to commercial. The planning permission contained the caution that it was purely permissive and did not overrule any private property rights. The second respondent's business involved the noisy mechanical sorting of rubbish. It moved to the farm as tenant in 2005 and shortly afterwards the first respondents complained of excessive levels of noise.

The first respondents brought an action against the second respondent in the Royal Court in voisinage, seeking damages and an injunction preventing it from conducting its business at the farm. The court (Bailhache, Bailiff and Jurats Tibbo and Morgan) found that the second respondent's activities constituted a breach of its duty of voisinage and granted the injunction (in proceedings noted at 2007 JLR N [65]). That decision was upheld on appeal (in proceedings reported at 2008 JLR 191).

The Royal Court (Bailhache, Bailiff) ordered that the Minister for Planning & Environment should be convened to the hearing of the first respondents' application for costs. The court considered that, although the second respondent was primarily responsible for the breach of voisinage, the Minister bore some responsibility since he encouraged the second respondent to relocate its business to a site where such a breach should have been foreseen. The court ordered that the second respondent should pay the first respondents' costs on the standard basis, but that it was entitled to recover 25% of those costs from the Minister.

The Minister appealed, submitting that (a) although the Royal Court had power, under art. 2(1) of the Civil Proceedings (Jersey) Law 1956, to order any person to pay the costs of proceedings, he had no connection to the proceedings and there was therefore no basis in reason or justice for the costs order made against him; (b) alternatively, if he were considered to have a connection with the proceedings, the court erred in finding that there was a sufficient causal link between his actions and the institution of the proceedings, in particular he had not encouraged the second respondent's activities; (c) a costs order would undermine art. 19(7) of the Planning and Building (Jersey) Law 2002, which provided that a grant of planning permission did not give any person the right to claim compensation in respect of any loss or damage he might suffer as a result of that action; and (d) he had not been given a proper opportunity to be heard, as the Royal Court's finding of encouragement had been made before the costs hearing when he first appeared.

Held, allowing the appeal:

(1) The appeal would be allowed, as the Royal Court had failed to have due regard to the fact that the Minister had no involvement in the proceedings. There was no limit to the power under art. 2(1) of the Civil Proceedings (Jersey) Law 1956 to award costs but it had to be exercised in accordance with reason and justice. Costs orders against non-parties were exceptional, in that they involved considerations outside the ordinary cases in which parties pursued or defended claims for their own benefit and at their own expense. Such cases were fact-specific and the ultimate consideration was to achieve justice as between the litigant seeking the order and the person against whom it was sought. In the vast majority of cases, it would be unjust to make an award of costs against a non-party. In general, a non-party would not be ordered to pay costs if the costs would have been incurred in any event, even without the non-party's involvement in the proceedings. Furthermore, a costs order would not generally be made against a mere funder of litigation, i.e. a person with no personal interest in the litigation, who did not stand to benefit from it, was not funding it as a matter of business and did not seek to control its events. A non-party who promoted or funded proceedings by an insolvent company solely or substantially for his own financial benefit would be liable for costs but careful consideration would be required in the case of an individual director who participated in or funded litigation. Although, in the present case, the grant of planning permission and its exercise were at the root of the litigation, the Minister had no involvement in or connection with the litigation whatsoever. He had not funded, directed or participated in it and had not stood to benefit from the outcome. The Royal Court should not, therefore, have ordered that the second respondent could recover from the Minister 25% of the first respondents' costs which it was ordered to pay and that part of the order would be excluded ( para. 42; paras. 67-68; paras. 74-75; paras. 78-79).

(2) Alternatively, even if the above conclusion were wrong, or if causation were not an essential requirement for a costs order against a non-party, the appeal would nevertheless be allowed because the Royal Court had not exercised its discretion under art. 2(1) reasonably. The Minister had not encouraged the second respondent's activities which were found to be in breach of its duty of voisinage in a way that could give rise to liability for costs. The grant of planning permission had been merely permissive, taken on planning merits, and neither the Minister nor the Planning Department had acted as adviser to the second respondent. Furthermore, the Royal Court had failed to address the important public policy arguments concerning art. 19 of the Planning and Building (Jersey) Law 2002 ( para. 71; para. 76).

(3) There should have been a hearing before the Royal Court in relation to the Minister's position before the costs order was made. The liability of a non-party to pay the costs of an action could, in certain cases, be dealt with summarily, if he had close proximity to or direction of the proceedings. Ordinarily, however, a non-party who had not funded an action and had no personal interest in it would not be liable for the costs incurred by the unsuccessful party without a full hearing of the merits. A claim against a non-party might be in contract or in tort and there might be very serious issues to be tried. Summary procedure had not been appropriate in the present case, as the Minister had not funded, directed or participated in the litigation or stood to benefit from the outcome ( paras. 72-74; para. 77).

1.McNEILL, J.A., delivering the judgment of the court:

Background

In April 2007, the first respondents, by Order of Justice in the Royal Court (Samedi Division), sought various orders against the second respondent. The principal order sought was that the second respondent cease carrying on a skip business and associated activities at Heatherbrae Farm or within one mile of the residence of the first respondents, "Les Ormes," both in the Parish of St. John.

2.One of the grounds set out was that, under the Jersey law doctrine of voisinage, an occupier or possessor of land must use the land in such a way that he does not cause damage to his neighbours. The first respondents averred that the second respondent's activities in operating a skip business in a property adjacent to the first respondents' home constituted a breach of those...

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