Case Study: Environment East Gippsland

Central to effective public interest lawyering is the ability for individuals and organizations to bring meritorious matters in the public interest to the courts for determination. Part of PILCH’s mandate is to remove structural barriers and risks that deter applicants, particularly those that are marginalized or disadvantaged, from pursuing such matters such as the risk of an adverse costs order. For some time now, PILCH has been campaigning for the introduction of legislation that would specifically empower Courts to make protective costs orders where they determine that a matter has been brought in the public interest.

This recommendation recently received broad endorsement by the Federal Attorney General in the release of the Government’s Access to Justice Report. The report says that judges would issue these orders in cases that would “determine, enforce or clarify an important right or obligation affecting the community or a significant section of the community, or affect the development of the law generally and reduce the need for further litigation.”

While the recommendation has drawn some criticism from business lobbies (see The Australian etc), a recent Victorian decision demonstrates the need for courts to be mindful of unfair cost burdens on applicants who raise public interest matters.

In the recent case of Environment East Gippsland Inc v VicForests (No 2) [2009] VSC 421 (unreported, 17 September 2009, Forrest J) the Supreme Court recognised the public interest nature of litigation as an important consideration in determining whether to order security in respect of an undertaking as to damages.

The Supreme Court has recently recognised the public interest nature of litigation as an important consideration in determining whether to order security in respect of an undertaking as to damages.

The case concerned an undertaking as to damages proffered by the applicant, Environment East Gippsland (EEG), in support of its application for an interlocutory injunction. The interlocutory injunction concerned logging activities in what EEG argued was a major native fauna habitat. EEG alleged that the logging was in breach of VicForest’s (the respondent) legislative obligations relating to conservation. VicForest submitted that EEG’s financial position made the undertaking inadequate, and that security should be imposed as a condition of the injunction. Forrest J rejected the respondent’s submissions on public interest grounds.

Forrest J stated that where an undertaking may be of dubious value, the court is required to exercise its judgement as to what is appropriate to ensure adequate compensation. Generally an applicant will be required to provide the undertaking or applicable security, unless ‘exceptional circumstances’ are present. 

Forrest J found that ‘exceptional circumstances’ were present given:

• the imperative of native fauna protection, and its public interest significance, was important to the purpose of the legislation in question;
• an order that EEG should provide security would probably ‘stultify its ability to conduct its case against VicForests and therefore run contrary to the public interest’;
• there is a ‘genuine risk of irremediable harm or serious damage’ to an endangered and threatened species, and in particular to its habitat; and that
• there is a ‘prima facie case that VicForests may, if it carries out its harvesting operations in the two coupes, breach statutory obligations’.
• His Honour therefore concluded that security should not be ordered in addition to the usual undertaking as to damages.