Hanson v Metricon Homes Pty Ltd (No 2) [2020] NSWSC 733

Supreme Court New South Wales

Medium Neutral Citation: Hanson v Metricon Homes Pty Ltd (No 2) [2020] NSWSC 733 Hearing dates: On the papers Date of orders: 12 June 2020 Decision date: 12 June 2020 Jurisdiction: Common Law Before: Hamill J Decision: (1) The defendant is to pay the costs of and incidental to the internal appeal to the Appeal Panel. (2) The defendant is to pay the costs of and incidental to the appeal to this Court. (3) These orders are stayed until 16 July 2020. Catchwords: CIVL LAW – costs – oppositional stance – no question of principle Legislation Cited: Civil and Administrative Tribunal Act 2013 (NSW), ss 83 and 84 Uniform Civil Procedure Rules 2005 (NSW), r 42.1 Cases Cited: Hanson v Metricon Homes Pty Ltd [2020] NSWSC 401 Jarrett v Westpac Banking Corporation [1999] FCA 425 Category: Costs Parties: Lloyd Hanson (First Plaintiff) Anna Hanson (Second Plaintiff) Metricon Homes Pty Limited (Defendant) Representation: Counsel: J Hyde (Plaintiffs) G Carolan (Defendant)

Solicitors: Wilkinson Building & Construction Lawyers (Plaintiffs) Moray & Agnew Lawyers (Defendant) File Number(s): 2019/254540 Publication restriction: Nil

Judgment 1. On 16 April 2020, I published a judgment known as Hanson v Metricon Homes Pty Ltd [2020] NSWSC 401. Familiarity with that judgment is assumed for the purpose of what follows. The orders made on 16 April 2020 were as follows: 1. Pursuant to s 84(2)(b) of the Civil and Administrative Tribunal Act 2013, extend time for the filing of the summons. 2. Pursuant to s 83 of the Civil and Administrative Tribunal Act 2013, grant leave to appeal against the decision of the Appeal Panel dated 31 May 2019 and known as Hanson v Metricon Homes Pty Ltd [2019] NSWCATAP 133. 3. Set aside the orders of the Appeal Panel made on 31 May 2019 and in lieu thereof make the following orders: 1. Appeal allowed. 2. The decision of Senior Member Goldstein dated 13 November 2018 is quashed. 3. Metricon's claim filed 15 December 2016 is remitted for hearing by a different single Member of the Civil and Administrative Tribunal to be dealt with according to law. 4. Metricon is to pay the costs of and incidental to the internal appeal to the Appeal Panel. 1. Proceedings 2019/00006261 in the District Court of New South Wales are stayed pending the determination of Metricon's claim in the Civil and Administrative Tribunal. 2. The defendant is to pay the costs of and incidental to the appeal to this Court. 1. Shortly after the publication of the judgment, the defendant sought a temporary stay of a number of those orders. The stay was designed to give the defendant time to consider whether to seek to appeal to the Court of Appeal. I stayed the relevant orders until 15 May 2020. A notice of intention to appeal was filed on 12 May 2020 and, on the defendant's application and by consent, I extended the stay of order 3(iii) until 16 July 2020. 2. The defendant also invited me to vacate orders 3(iv) and 5 (relating to costs) and to allow the parties to make written submissions concerning the orders relating to costs of proceedings before the Appeal Panel and this Court. I vacated the costs orders on 24 April 2020 and set a timetable for submissions. The parties have now made those submissions. 3. The defendant submits that the appropriate order is for the parties to pay their own costs of the proceedings before the Appeal Panel and this Court. In essence, it asserts that the fact that the plaintiffs were denied procedural fairness in the original proceedings before Senior Member Goldstein was through no fault of the defendant. Emphasis was given to the fact that an expert report was served very late, a matter out of the control of the parties, and the fact that the plaintiffs' lawyer left the hearing in circumstances which were not adequately explained. The defendant relied on the extensive delay in the original proceedings, much (if not all) of which was attributable to the fault of the plaintiffs. 4. The defendant also submits that an order other than one requiring each party to bear their own costs would put the plaintiffs in a "better position" than they would have been if they had "expressly" and successfully sought an adjournment on the first day of the trial. The defendant relied on Jarrett v Westpac Banking Corp. [1] The defendant submitted: "Had the plaintiffs expressly made an application for an adjournment then in order to enable them to obtain new legal representation or to consider their options in relation to the Zakos report, it is entirely likely that they would have faced an application for costs thrown away. That application was likely to have been successful, given the history of the matter." 1. The plaintiffs submitted that the appropriate costs order was an orthodox one whereby costs follow the event. Reliance was placed on r 42.1 of the Uniform Civil Procedure Rules 2005 (NSW) and the plaintiffs noted the oppositional stance taken by the defendant in the appeal process. The plaintiffs argued that the delay in the proceedings before the Tribunal was attributable to both parties. They referred to consent orders made on 14 February 2018, "for an adjournment to enable engineering issues to be investigated and the subject of further expert evidence" as well as the defendant's failure to "consent to the appeal". 2. While the substance of the defendant's submissions appears to be factually correct, two things should be noted. First, I made no orders concerning the costs of the proceedings before Senior Member Goldstein. The absence of an order reflected the fact that the defect in the proceedings was not really attributable to the conduct of the defendant, even though it was represented by counsel and could have encouraged the Senior Member to adjourn the proceedings in circumstances where the plaintiffs were left unrepresented following the late service of the expert report. 3. The second thing to note is that the defendant made no real concessions at any stage of the appeal process. Apart from acknowledging in this Court that the proceedings before the Senior Member were "unorthodox", no concession of any significance was made in the course of the internal appeal and the appeal to this Court. At both stages the defendant sought to have the decision of the Senior Member upheld. Had the defendant acknowledged the problems that developed in the original proceedings, and consented to orders that facilitated the plaintiffs receiving a further hearing, the costs of the appeal process would have been minimal. 4. None of the matters now raised dissuade me from the view that the defendants should bear the costs of the proceedings before the Appeal Panel and the proceedings in this Court. 5. The decision of the Federal Court in Jarrett v Westpac Banking Corporation compels no different conclusion. The circumstances of that case are distinguishable from the facts of the present appeal. I accept the plaintiffs' submission that it is "untenable" for the defendant to assert that the plaintiffs "failed to seek an adjournment." [2] The plaintiffs became self-represented immediately before the hearing commenced. Only one of the plaintiffs had read the lengthy expert report provided a few days earlier. The record showed that neither had seen the "bundles" of evidence tendered before the Senior Member. When asked they were ready to proceed and they both replied "not really". The Appeal Panel accepted that there was, in effect if not in terms, an application for an adjournment. [3] I also accept the plaintiffs' submission that "there is no certainty that, considered properly, there would have been any basis to order that the plaintiffs pay costs of any vacated hearing in circumstances where a critical report was provided late through no fault of the plaintiffs." 6. For those reasons, I make the following orders: 1. The defendant is to pay the costs of and incidental to the internal appeal to the Appeal Panel. 2. The defendant is to pay the costs of and incidental to the appeal to this Court. 3. These orders are stayed until 16 July 2020.