Civil and Administrative Tribunal New South Wales Medium Neutral Citation: D'Annunzio v North Sydney Council (No 2) [2020] NSWCATAP 98 Hearing dates: On the papers Date of orders: 29 May 2020 Decision date: 29 May 2020 Jurisdiction: Appeal Panel Before: L Pearson, Principal Member Dr J Lucy, Senior Member Decision: (1) Pursuant to s 50(2) of the Civil and Administrative Tribunal Act 2013, a hearing on the question of costs of the appeal is dispensed with. (2) The appellant is to pay the respondent's costs of the appeal as agreed or assessed. Catchwords: COSTS - appeal dismissed – whether order for costs should be made Legislation Cited: Civil and Administrative Tribunal Act 2013 Civil and Administrative Tribunal Rules 2014 Retail Leases Act 1994 Cases Cited: D'Annunzio v North Sydney Council [2020] NSWCATAP 66 Latoudis v Casey (1990) 170 CLR 534 Northern Territory v Sangare (2019) 265 CLR 164 Oshlak v Richmond River Council [1998] HCA 11 Ruddock v Vadarlis [2001] FCA 1865 Thomson v Chapman [2016] NSWCATAP 6 Texts Cited: None cited Category: Costs Parties: Carlo D'Annunzio (Appellant) North Sydney Council (Respondent) Representation: Counsel: D Eardley (Appellant) Solicitors: Praxis Lawyers (Appellant) Hunt & Hunt Lawyers (Respondent) File Number(s): AP20/01855 Publication restriction: Nil Decision under appeal Court or tribunal: Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Citation: N/A Date of Decision: 16 December 2019 Before: G Ulman, Senior Member File Number(s): COM 18/41110 REASONS FOR DECISION 1. On 22 April 2020 the Appeal Panel dismissed an appeal from a decision of the Tribunal to dismiss an application by Carlo D'Annunzio for compensation pursuant to s 63E of the Retail Leases Act 1994 (the RL Act): D'Annunzio v North Sydney Council [2020] NSWCATAP 66. 2. Mr D'Annunzio is a former lessee under a retail shop lease, the lessor being North Sydney Council (the Council). In his application to the Tribunal in the Consumer and Commercial Division, COM 18/41110, he claimed that the Council as lessor had engaged in misleading and deceptive conduct in breach of the RL Act prior to his entering into the lease, and that as a consequence of those breaches he had lost his livelihood. He sought compensation in the amount of $189,887.56 including $8,179.61 for the security bond. 3. In separate proceedings (COM 18/44353) the Council claimed arrears of rent and damages from Mr D'Annunzio for breaches of the lease, and sought payment of the rental bond paid as a security deposit. 4. Both matters were heard together. In proceedings COM 18/44353 the Tribunal ordered that Mr D'Annunzio pay the Council the amount of $29,864.32 and made a declaration that the Council was entitled to be paid the security bond. There was no appeal from the orders in COM 18/44353. The Tribunal dismissed the application COM 18/41110. Mr D'Annunzio's appeal against the decision in COM 18/41110 was also dismissed. 5. The Council applied on 29 April 2020 for an order for costs of the appeal. The Appeal Panel made directions for the parties to provide submissions, including a direction that those submissions were to include any submissions as to whether a hearing is required. Whether a hearing on costs should be dispensed with 1. Section 50 of the Civil and Administrative Tribunal Act 2013 (the NCAT Act) relevantly provides: 50 When hearings are required (1) A hearing is required for proceedings in the Tribunal except: … (c) if the Tribunal makes an order under this section dispensing with a hearing, or … (2) The Tribunal may make an order dispensing with a hearing if it is satisfied that the issues for determination can be adequately determined in the absence of the parties by considering any written submissions or any other documents or material lodged with or provided to the Tribunal. (3) The Tribunal may not make an order dispensing with a hearing unless the Tribunal has first: (a) afforded the parties an opportunity to make submissions about the proposed order, and (b) taken any such submissions into account. (4) The Tribunal may determine proceedings in which a hearing is not required based on the written submissions or any other documents or material that have been lodged with or provided to the Tribunal in accordance with the requirements of this Act, enabling legislation and the procedural rules. … 1. The parties had an opportunity to make submissions as to whether a hearing on costs was required. Both agreed that the question of costs can be determined on the papers. The Appeal Panel is satisfied that the issue of costs can be adequately determined in the absence of the parties by considering the parties' written submissions. The parties would be put to unnecessary expense if a hearing on costs were held. 2. The order under s 50(2) of the NCAT Act has accordingly been made. Submissions on costs 1. The respondent Council submits that an order for costs should be made, on the basis that the Council was entirely successful on the appeal. Relevant to the consideration on the question of costs were the relative strengths of the claims, namely that many of the grounds of appeal were not pressed; there was no tenable basis for two of the grounds pressed; leave was required and refused in respect of both grounds of appeal; and while leave was refused, the Appeal Panel indicated it would have rejected both substantive grounds. Further, there was no conduct by Council that would disentitle it to usual costs orders. 2. Mr D'Annunzio submits that contrary to the Council's submissions, rule 38 of the Civil and Administrative Tribunal Rules (the NCAT Rules) was not engaged, as the award made to the Council on its claim was less than $30,000. It is submitted that Mr D'Annunzio is unemployed and in receipt of Commonwealth benefits, has negligible property and owns no real property, and does not have the financial resources to meet a costs order. In the circumstances, the making of a costs order when it cannot be satisfied is nugatory. If that submission is rejected, it is open for the making of a costs order on an ordinary basis. Mr D'Annunzio's position is that the Tribunal would not be persuaded to exercise discretion to make an order for costs. 3. In reply, the Council submits that rule 38 is engaged. There is no evidence as to the personal circumstances of Mr D'Annunzio, and in any event those matters are not relevant to the determination of costs. Whether an order for costs should be made 1. The general rule in relation to costs in the Tribunal is that, unless special circumstances are established, the parties pay their own costs: s 60(1) of the NCAT Act. Subsection 60(3) lists the matters to which the Tribunal may have regard in determining whether there are special circumstances warranting an award of costs. 2. Rule 38 of the NCAT Rules modifies the application of s 60 in proceedings before the Consumer and Commercial Division of the Tribunal. Rule 38(2)(a) provides that in proceedings where the amount claimed or in dispute is more than $30,000, the Tribunal may award costs in the absence of special circumstances. 3. As noted above, there were two proceedings in the Consumer and Commercial Division, COM 18/44353 and COM 18/41110. The appeal was brought from the order in COM 18/41110 to dismiss Mr D'Annunzio's application for compensation, for a total amount of $189,887.56. The amount claimed or in dispute in the proceedings COM 18/41110 was more than $30,000, and rule 38 of the NCAT Rules therefore applied. The appeal from that decision was lodged after 1 January 2016, and the provisions applicable to determination of costs at first instance apply in the appeal: rule 38A of the NCAT Rules. 4. Rule 38 confers on the Tribunal a wide discretion to make an order for costs. While it does not specify the factors the Tribunal must take into account in exercising the discretion, the discretion to make such an order must be exercised judicially: Ruddock v Vadarlis [2001] FCA 1865 at [9]. Where an application has been heard and determined on the merits, the appropriate starting point for the exercise of the discretion is the well-established position at common law, that is, that the purpose of making a costs order is to provide compensation to the party in whose favour the order is made for the expense the party has been put to in prosecuting or defending legal proceedings. In general, that means that a party who is successful is entitled to an order for costs in its favour: Latoudis v Casey (1990) 170 CLR 534; Oshlak v Richmond River Council [1998] HCA 11. 5. However, as discussed by the Appeal Panel in Thomson v Chapman [2016] NSWCATAP 6 at [71], where there is a general discretion for costs there is no absolute rule that, absent disentitling conduct, a successful party is to be compensated by the unsuccessful party, and nor is there any rule that a successful party might not be ordered to bear the costs of an unsuccessful party. In circumstances where there is a general discretion to award costs, the Tribunal in exercising its discretion is to have regard to the nature of the proceedings before it and all relevant factors arising in connection with those proceedings for the purpose of determining what order for costs, if any, should be made. Factors that might influence whether the usual order for costs should apply and if so to what extent, would include whether by reason of the relative success of the parties on different issues and the time taken to determine those issues, an order for costs based on the issues determined should be made; and whether by reason of the nature of the proceedings the usual rule should otherwise be displaced in whole or in part. 6. The Council was entirely successful in the appeal. Neither of the two grounds pressed on the appeal were grounds which raised an error on a question of law; Mr D'Annunzio required leave to appeal, and leave to appeal was refused on both grounds. At [37] and [50] the Appeal Panel noted that even if either ground had raised a question of law, the Tribunal below had not made an error of law. There was no disentitling conduct on the part of the Council in its conduct of the appeal. None of the factors relating to Mr D'Annunzio's personal circumstances are relevant to the question of whether the respondent to the appeal is entitled to a costs order in its favour. In particular, "the courts have consistently rejected the suggestion that a costs order should not be made against an impecunious party because it would be futile to do so" (Northern Territory v Sangare (2019) 265 CLR 164 at 176 [35]). 7. There being no basis on which to depart from the usual rule that the successful party is entitled to be compensated for its costs incurred in defending the appeal, the Appeal Panel is satisfied that the usual order for costs should apply. Orders 1. The Appeal Panel orders: 1. Pursuant to s 50(2) of the Civil and Administrative Tribunal Act 2013, a hearing on the question of costs of the appeal is dispensed with. 2. The appellant is to pay the respondent's costs of the appeal as agreed or assessed. ********** I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 29 May 2020