Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Sadlo v Australian Retirement Holdings Pty Ltd (Costs) [2020] NSWCATAP 207 Hearing dates: On the papers after 17 September 2020 Date of orders: 12 October 2020 Decision date: 12 October 2020 Jurisdiction: Appeal Panel Before: N Hennessy ADCJ, Deputy President L Pearson, Principal Member Decision: (1) A hearing is dispensed with under s 50 of the Civil and Administrative Tribunal Act 2013 (NSW). (2) The application by Australian Retirement Holdings Pty Limited for costs is refused. Catchwords: APPEAL –application for costs on appeal – whether there are special circumstances warranting a costs order Legislation Cited: Civil and Administrative Tribunal Act 2013 (NSW) Civil and Administrative Tribunal Rules 2014 (NSW) Retirement Villages Act 1999 (NSW) Cases Cited: Sadlo v Australian Retirement Holdings Pty Ltd [2020] NSWCATAP 169 Texts Cited: None cited Category: Costs Parties: Walter Sadlo (Appellant) Australian Retirement Holdings Pty Ltd (Respondent) Representation: Counsel: G Watson SC (Appellant) J Trebeck (Respondent) Solicitors: Eakin McCaffery Cox (Respondent) File Number(s): AP 20/13633 Publication restriction: Nil Decision under appeal Court or tribunal: Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Citation: N/A Date of Decision: 18 February 2020 Before: J Ringrose, General Member File Number(s): RV 19/10105 REASON FOR DECISION Overview 1. Mr Sadlo is a resident of a retirement village operated by Australian Retirement Holdings Pty Ltd. He brought proceedings against the operator under the Retirement Villages Act 1999 (NSW). The Tribunal dismissed his application and ordered him to pay Australian Retirement Holdings $25,000 for its legal costs. Mr Sadlo appealed to the Appeal Panel from the costs order. The Tribunal dismissed the appeal: Sadlo v Australian Retirement Holdings Pty Ltd [2020] NSWCATAP 169. Australian Retirement Holdings has applied for Mr Sadlo to pay its costs of the appeal. 2. Mr Sadlo agreed that the application for costs could be determined without a hearing, and there was no submission to the contrary from Australian Retirement Holdings. We have decided to dispense with a hearing: Civil and Administrative Tribunal Act 2013 (NSW)(NCAT Act), s 50. Costs rule 1. The applicable costs rule is that each party is to pay their own costs. It is only where the Tribunal is satisfied that there are special circumstances warranting an award of costs that it may order costs. We have concluded that this is the applicable costs rule because, on an internal appeal, we must "apply the first instance costs provisions": Civil and Administrative Tribunal Rules 2014 (NSW), cl 38A. Because the amount claimed or in dispute at first instance was not more than $30,000, the costs rule in s 60 of the NCAT Act applies: Civil and Administrative Tribunal Rules 2014 (NSW) (NCAT Rules), rule 38. 2. The applicable costs rule is set out in s 60 of the NCAT Act: Costs (1) Each party to proceedings in the Tribunal is to pay the party's own costs. (2) The Tribunal may award costs in relation to proceedings before it only if it is satisfied that there are special circumstances warranting an award of costs. (3) In determining whether there are special circumstances warranting an award of costs, the Tribunal may have regard to the following— (a) whether a party has conducted the proceedings in a way that unnecessarily disadvantaged another party to the proceedings, (b) whether a party has been responsible for prolonging unreasonably the time taken to complete the proceedings, (c) the relative strengths of the claims made by each of the parties, including whether a party has made a claim that has no tenable basis in fact or law, (d) the nature and complexity of the proceedings, (e) whether the proceedings were frivolous or vexatious or otherwise misconceived or lacking in substance, (f) whether a party has refused or failed to comply with the duty imposed by section 36(3), (g) any other matter that the Tribunal considers relevant. (4) If costs are to be awarded by the Tribunal, the Tribunal may— (a) determine by whom and to what extent costs are to be paid, and (b) order costs to be assessed on the basis set out in the legal costs legislation (as defined in section 3A of the Legal Profession Uniform Law Application Act 2014) or on any other basis. (5) In this section— costs includes— (a) the costs of, or incidental to, proceedings in the Tribunal, and (b) the costs of, or incidental to, the proceedings giving rise to the application or appeal, as well as the costs of or incidental to the application or appeal. Identification of special circumstances 1. Australian Retirement Holdings has identified the following matters as amounting to special circumstances warranting an award of costs: 1. Mr Sadlo's grounds of appeal were lacking in substance and had no tenable basis. The Appeal Panel "easily dismissed" those grounds of appeal. 2. Mr Sadlo argued that there was a "substantial miscarriage of justice" but did not engage in any way with any of the "leave grounds" in Sch 4 Part 5, cl 12 of the NCAT Act. Identifying a discrete basis of appeal, but not addressing its components in written submissions, is a "special circumstance". Mr Sadlo continued to pursue the point in reply, when it ought to have been dropped. Australian Retirement Holdings should not have been put to the expense of responding to a submission which did not address in any meaningful way the criteria of the legislation. 1. Mr Sadlo submitted that there are no special circumstances justifying an order for costs on appeal. He opposed an order for costs, submitting that each party should bear its own costs. Strength of appeal 1. The first matter said to justify a costs order relates to the "the relative strengths of the claims made by each of the parties, including whether a party has made a claim that has no tenable basis in fact or law" and "whether the proceedings were frivolous or vexatious or otherwise misconceived or lacking in substance": NCAT Act, s 60(1)(c) and (e). 2. Mr Sadlo submitted that costs do not "follow the event" in these proceedings and the fact that he was unsuccessful is not a reason to order costs. The appeal was brought in good faith and Mr Sadlo is an aged pensioner living in a retirement village, not a powerful and wealthy litigant attempting to make a point. 3. At [35] – [57] of the primary decision, we addressed the question as to whether any of Mr Sadlo's grounds of appeal identified a question of law and, if so, whether the Tribunal had made any legal errors. Our ultimate conclusion was that while questions of law had been identified, the Tribunal had not erred. We dismissed Mr Sadlo's appeal from the first instance costs decision. However, it cannot be said, in the technical legal sense, that the grounds of appeal were lacking in substance or had no tenable basis. Those grounds were weak, but not so weak as to justify a costs order. Disadvantaging Australian Retirement Holdings 1. The second "special circumstance" is said to be that Mr Sadlo "has conducted the proceedings in a way that unnecessarily disadvantaged" Australian Retirement Holdings. That disadvantage was to seek leave to appeal because there was a "substantial miscarriage of justice" but to fail to provide any basis for that application in the written submissions or in the reply. 2. We addressed this issue at [9] – [11] of the appeal from the first instance costs decision and concluded at [12] that: Mr Sadlo has appealed from the Costs Decision on a question of law. He has also asked that, if the appeal is not upheld on a question of law, permission be given for him to appeal on a ground other than a question of law. He relies on the same grounds as constituting a substantial miscarriage of justice. If necessary, we will decide whether to give Mr Sadlo permission to appeal on that basis. 1. Mr Sadlo's reasons for seeking leave to appeal were made on the same basis as his appeal on questions of law. Australian Retirement Holdings were not unnecessarily disadvantaged by Mr Sadlo's failure to articulate any separate grounds for seeking leave. It follows that that failure does not constitute a special circumstance warranting a costs order on appeal. Orders 1. A hearing is dispensed with under s 50 of the Civil and Administrative Tribunal Act 2013 (NSW). 2. The application by Australian Retirement Holdings Pty Limited for costs is refused. ********** 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: 12 October 2020