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Indemnity Costs Order in Class 3 Proceedings

On 7 February 2018, Molesworth AJ of the Land and Environment Court delivered his judgment in Croghan v Blacktown City Council (No 2) [2019] NSWLEC 9 (Croghan). The judgment represents a notable development in the law concerning the making of costs order in Class 3 land acquisition proceedings.  It represents the first time that the Land and Environment Court in New South Wales has ordered the claimant to pay the acquiring authority’s legal costs assessed on an indemnity basis.


In Croghan, the acquiring authority is Blacktown City Council (Council), who sought to acquire part of Mr Croghan’s land in the suburb of Vineyard in 2016 for the purpose of constructing new drainage system and for public recreational uses.

In October 2016, the Valuer-General of New South Wales had assessed the total compensation payable to Mr Croghan at $4,802,000.

Dissatisfied with the Valuer General’s assessment, Mr Croghan lodged an appeal in the Land and Environment Court under the Court’s Class 3 jurisdiction. In the Class 3 Application, Mr Croghan sought a compensation of $11,157,251.88.  This figure was revised down $8,405,752.00 four days before the hearing in February 2018.
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