CITATION: Gizah Pty Limited -v- AXA Trustees Limited (No. 2) [2001] NSWADT 164 DIVISION: Retail Leases Division APPLICANT PARTIES: Gizah Pty Limited RESPONDENT AXA Trustees Limited FILE NUMBER: 005052 HEARING DATES: 31/08/2001 SUBMISSIONS CLOSED: 08/31/2001 DATE OF DECISION: 09/27/2001 BEFORE: Molloy GB - Judicial Member APPLICATION: Costs MATTER FOR DECISION: Principal matter LEGISLATION CITED : Administrative Decisions Tribunal Act 1997 Retail Leases Act 1994 Brooks Maher v Cheng ( 2001 ) NSWADT 18 Mark Phillip Symonds ( 1995 ) 2LPDR 10 Hoblos vs Marchese (1999) NSWADT 127 Hurt v Director General , Department of Fair Trading (1999) NSWADT 50 Destination Travel Pty Limited v Travel Compensation Fund (2000) NSWADT 12 Colleja v Malli [2001] NSWADT 20 CASES CITED: Lynch v Perpetual Trustees Australia Limited [2000] NSWADT 78 Law Society v Gallagher [1999] NSWADT 8 Caltex Refining Co.Pty.Ltd v Maritime Services Board of NSW (1995) 36 NSWLR 552. Sloey v State Transit (1999 ) NSWATD 40 Mangoplah Pastoral Company Pty Ltd v Great Southern Energy (No 2)(2000) NSWADT 4 Charteris (No 2) v General Manager , Leichardt Council [2000] NSWADT 109 Gulliver v General Manager , Maitland City Council (1999)NSWADT 67 Prsa v Polymeris[2000] NSWADT 108 APPLICANT REPRESENTATION: C Newlands, barrister RESPONDENT V Tsolakis, barrister ORDERS: 1. The Respondent pay to the Applicant within twenty-eight days (28) days the sum of $15,286.11 interest; 2. The Respondent pay the Applicant's costs of these proceedings; 3. Liberty to apply . Background 1 The Applicant was the Lessee of certain premises and the Respondent was the Lessor. The Applicant brought proceedings seeking relief in the Tribunal and those proceedings were heard by me on 7 and 8 June 2001 and my decision was delivered 12 July 2001. 2 I made the following Orders: (1) The Lease executed by the Applicant as Lessee and the Respondent as Lessor in respect of premises being part Folio Identifier 3/789759 and being shop 8, Food Court, Level 7, MMI Centre, 2 Market Street, Sydney and commencing 5 January 2000 be and is hereby terminated as at the date of this order. (2) The Applicant vacate the said shop as at the date of this order. (3) Upon the vacation and termination of the said Lease neither party to that Lease be under further liability to the other thereunder. (4) The Respondent pay to the Applicant damages in the sum of $132,976.00. (5) Leave granted to the Applicant to re-list this matter before me within fourteen days of the date of this order to argue either or both of the following issues: a) Whether the Respondent should pay interest upon the damages so ordered. b) Whether the Respondent should pay the costs of the Applicant of the whole matter, or any part of the matter. (6) Should the Applicant re-list to argue either or both of the above issues then such argument will be limited to the issue or issues the subject of the re-listing. In the event that the Applicant does not re-list for argument on the question of interest, then no interest will be payable in the event that the Applicant does not re-list on the argument that the Respondent pay the Applicant's costs then there will be no order for costs. 3 The Applicant re–listed this matter to argue both of the above issues. Claim For Interest 4 The Applicant Lessee seeks an order that it be awarded interest on the damages ($132,976.00.) The Retail Leases Act 1994, S.72A, gives this Tribunal power to award interest at a specified rate not exceeding the rate at which interest is payable on a judgment debt in the District Court. Interest is of course awarded by a way of compensation in support of the entitlement of a successful party to be properly compensated for its loss. 5 The Applicant claimed interest on its unchallenged set- up costs of $38.712.00 from the date of the Lease (5 January 2000) to the date of payment of the damages (31 August 2001 ) at the relevant District Court rates, in total $6243.24. 6 The Applicant also claimed interest on the balance of the damages ordered ($94,264.00) from the date of the Lease to the expected date of payment (26 July 2001), in total $15,202.33, then claimed one half only of that sum on the general basis that the losses were incurred from time to time during the currency of the occupancy of the demised premises, thereby reducing the amount claimed to $7601.17, then claimed further interest for the next 36 days on that sum to the actual date of payment (31 August 2001 ) at $1442.70. 7 There was no challenge to the application for interest and there was no challenge to the method of calculation, the various rates to be applied and the method of calculation. 8 In those circumstances in seems to me that the Applicant is entitled to an Award of Interest in $7601.17 plus $1442.70 plus $6243.24, in Total $15.287.11. Claim for costs : 9 The Applicant submitted that it should be entitled to an order that the Respondent pay its costs of the proceedings. It submitted that there were special circumstances that entitled it to such an order, and these circumstances were, in summary, a) Attempted alternative dispute resolution was not helpful and was unsuccessful. b) An adjournment was obtained by the Respondent on the basis that the affidavit of its prime witness ( Mr Stollznow ) had not been prepared. This application demonstrated unreasonable conduct by the Respondent because it was in breach of the Orders of the Tribunal in not filing the affidavit within the time specified and either the Applicant or its legal advisers had not taken the statement of the witness, alternately had taken the statement of the witness but had not engrossed it, alternately had not filed it. c) There was dishonest conduct by another witness for the Respondent in making various statements to the Directors of the applicant in circumstances where he knew that the statements were incorrect and that such was unconceivable conduct. d) The directors of the Applicant were cross-examined on loss of profits in circumstances where the evidence showed that the Applicant was stuck with the Lease and the Respondent would not let the Applicant out of the Lease. e) The Respondent ran every point, even not sustainable points ,eg that Mr Stollznow did not have any authority when plainly he did. f) In all the circumstances the case should not have been run by the Respondent, because on its own evidence its case was un-sustainable because its own evidence supported that of the Applicant, particularly in relation to the representations and the property manager knew about the representations, knew they were false and yet continued to conduct the case and had control over the case. 10 The Respondent, not surprisingly, submitted that there were no special circumstances , that there was nothing different in this case from the norm and that a win does not entitle an Applicant to a costs order. The law: 11 During the course of the hearing the Respondent referred to the recent decision of this Tribunal in Brooks Maher v Cheng ( 2001 ) NSWADT 18 and I referred to Mark Phillip Symonds ( 1995 ) 2LPDR 10 and Hoblos vs Marchese (1999) NSWADT 127. No authorities were referred to by the Applicant. 12 Further research by me has thrown up quite a number of authorities of the meaning of "special circumstances" when dealing with that phrase in the context of the varying jurisdictions of this Tribunal when making costs orders. 13 It is trite to observe that this Tribunal has power to make orders for costs . That power is to be found in Administrative Decisions Tribunal Act 1997, Section 88. That section is in the following terms: 88 Costs (1) Subject to the rules of the Tribunal and any other Act or law, the Tribunal may award costs in relation to proceedings before it, but only if it is satisfied that there are special circumstances warranting an award of costs. (2) 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 Division 6 of Part 11 of the Legal Profession Act 1987 or on any other basis. (3) However, the Tribunal many not award costs in relation to proceedings for an original decision unless the enactment under which the Tribunal has jurisdiction to make the decision provides for the awarding of costs. (4) In this section, costs includes: (a) costs of or incidental to proceedings in the Tribunal, and (b) the costs of or incidental to the proceedings giving rise to the application , as well as the costs of or incidental to the application. 14 The power in the Retail Leases Division referred to in section 88 (3) above is contained in Retail Leases Act 1994, section 77 A. 15 It is further trite to observe the words "special circumstances" appear in many pieces of legislation. In my view it is not helpful to embark upon an analysis of that phrase in legislation that deals otherwise than with costs. Clearly different considerations apply and the Tribunal is likely to fall into error if it attempts to transpose decisions relating to that phrase as relate to the use of that phrase in other factual–legal milieus. 16 Even within this Tribunal there are a number of different Divisions in which costs orders can be made under section 88 but in relation to different legislation where perhaps different considerations apply. 17 So for example , an application for costs was refused in Hurt v Director General , Department of Fair Trading (1999) NSWADT 50 where there was an appeal from an administrative decision to refuse the applicant a contractor licence and the Tribunal made these observations: (9) The costs discretion is a wide one. While the usual rule in many proceedings is that costs follow the event, in the case of this legislation that rule is moderated significantly. (10) The legislation creating the Administrative Decisions Tribunal seeks to advance certain objectives of the Parliament, one of which is to enable people to exercise the right to review decisions made by administrators where the Act under which the administrators have made the decision gives a review jurisdiction to the Tribunal. (11) The scheme of the legislation permits individuals to obtain internal review of reviewable decisions before proceeding in the Tribunal. Following internal review people may seek further review of the decision externally in this Tribunal. (12) The complication that has arisen in this case is one that has arisen in a number of matters that have been dealt with by the Tribunal in its early history. That complication is that the original administrative decision in relation to which review is sought is one that is mandatory in character rather than discretionary. The Act does not plainly differentiate between original administrative decisions that are mandatory in character and those that are discretionary in character. The scheme of rights that is found in the legislation, to which I have alluded, applies equally whether the original administrative decision is a mandatory or discretionary in character, provided the original administrative decision is one in relation to which review jurisdiction has been conferred. So it is open to individuals who have had a decision made against them by an administrator on a mandatory ground nevertheless to seek both internal review by the administrator and external review by this Tribunal, even though the prospects of success may be extremely limited or non-existent. (13) These considerations, it seems to me, colour the question as to whether "special circumstances" exist in the present instance to warrant an award of costs against the applicant. The applicant has on the face of the Administrative Decisions Tribunal Act and on the face of the amendment conferring jurisdiction that now appears in the Home Building Act (see Part 4A ), unqualified rights in respect of applications for internal review and external review. In my opinion it would be undesirable for the Tribunal to encourage , by the way of adverse costs orders, people to be reluctant to exercise their statutory rights. On the other hand I recognise, to a degree at least ,the concern that the Department is expressing through this application which is that the real prospects of success are remote to non-existent , the Department should not be put to the trouble of responding at various levels of the legal system to this kind of application. (14) Nonetheless as I see it the scheme in the legislation permits individuals to exercise their rights in that way . Further if one examines the correspondence from the Department of Fair Trading to the applicant it properly, in terms of the Administrative Decisions Tribunal Act, notifies him of the various rights that he has including at the first stage of the process his right of internal review and subsequent to internal review his right to seek external review by this Tribunal. Mr Hurt exercised his right of internal review. It would appear that Mr Hurt has involved himself in the present proceedings on an unrepresented basis and as an unrepresented litigant. It would not be unreasonable of him to conclude without legal advice that he had some meaningful right of access to this Tribunal. (16) I acknowledge that the Department has obviously been put to expense by these proceedings . But I think it would be dangerous as I have indicated previously, to implement a regime of costs orders so as to deal to what appears to me to be a lack of clarity on the face of the legislation as to the practical difference that applies to review rights in circumstances where that appeal relates to a discretionary decision as distinct from the circumstances where it relates to a mandatory decision. 18 To similar effect are observations of this Tribunal in Insley v State Electoral Commissioner ( No 2 ) ( 2001 ) NSWADT 24 in an action relating to a local council election result. The Tribunal said this- (16)…..To use the costs power as some kind of sanction to punish agencies for poor administration would ,I consider , involve the error condemned frequently by the courts of using the costs sanction for punitive rather than compensatory purposes… This Tribunal only becomes involved in the issue of bad administration to the extent that statutory procedures pertinent to an application may not have been observed. (17)……we note that it is not enough for the party applying for a costs order to be successful in the original proceedings…The legislature has given a clear indication that the Tribunal is not to apply the usual approach to an unfettered discretion to award costs in judicial proceedings, ie that the successful party can expect to enjoy the benefit of a costs order. Something more than success is needed to warrant an order, whether the successful party is a citizen challenging an administrative decision or an administrative agency resisting such a challenge. (18)…..While it is clear that (the applicant) has been successful in his action , there is nothing to distinguish his case from others in which one party has been successful. There is nothing which indicates something unusual or rare or outstanding and therefore "special" in the circumstances relating to this particular case. 19 For reasons that I set out below it is not my view that the last sentence of the above quotation is the correct test to apply, certainly not in relation to the Retail Leases Division of this Tribunal. 20 In Sloey v State Transit (1999 ) NSWATD 40, a case under Anti Discrimination Act, the Tribunal based its decision on section 114 of that Act, rather than section 88 of the Administrative Decisions Tribunal Act. Consequently, although Sloey appears to have been relevantly quoted with approval by the Tribunal in Mangoplah Pastoral Company Pty Ltd v Great Southern Energy (No 2)(2000) NSWADT 4, in relation to how one interprets the phrase "special circumstances" under section 88, in my view Sloey is not helpful in this context . However the Tribunal in Mangoplah said this – (5) The legislature has given a clear indication that the Tribunal is not to apply the usual approach to an unfettered discretion to award costs in judicial proceedings, ie that the successful party can expect to enjoy the benefit of costs order. Something more than success is needed to warrant an order, whether the successful party is a citizen challenging administrative decision or administrative agency resisting such a challenge. Moreover, due to the nature of the Tribunal's jurisdiction in its General Division, the fact that the proceedings concern the correctness of an action taken by a government agency does not of itself raise a " special" consideration. In such proceedings both sides should normally come to the Tribunal with the expectation that they will carry their own costs. 21 And finally, I make reference to the Charteris (No 2) v General Manager , Leichardt Council [2000] NSWADT 109. This case involved freedom of information legislation and the Tribunal said– (6) I accept the view…that the costs power should not be used as "some kind of sanction to punish agencies for poor administration" preceding the Tribunal proceedings and that the Tribunal should not embark on a" general enquiry into the way in which the agency dealt with the applicant." However…it may be relevant to consider whether an agency has failed to observe statutory procedures "pertinent to an application" to the Tribunal, at least where it is found that these have had an impact on the costs incurred by the applicant so as to make it appropriate that the agency should indemnify some or all of them. When considering an agency's conduct in relation to the proceedings, I remain of the view expressed in Mangoplah…: "in a costs application under section 88(1), I do not think that the reasonableness of a party's contest of proceedings before the Tribunal should be assessed by an overly critical scrutiny". 22 The difficulty with relying upon interpretations of the phrase "special circumstances" in the context of appeals from administrative decisions is that the legislative milieu appears to have been interpreted in such a way that parties are not to be discouraged from appealing to this Tribunal by risk as to costs, even from mandatory decisions , as a matter of public policy. Therefore as I read the decisions the bar appears to be higher for an applicant for costs in these circumstances than perhaps in the Retail Leases Division. In my view the phrase " special circumstances " must be interpreted in the context of the Division of this Tribunal or other legislative milieu in which the phrase appears. To interpret the phrase is in an inflexible way would be in my view do injustice to the relevant legislation and injustice to the parties. 23 Before embarking upon an analysis of the phrase " special circumstances" in the context of the Retail Leases Act, there are a number of observations that I would seek to respectfully make. Firstly, its seems to me that once it has been demonstrated to that there are special circumstances the circumstances of the other party are simply irrelevant. Section 88 makes it plain in my opinion that once special circumstances warranting an award of costs are found, it would be a brave Tribunal not to make an order for costs. Although the phraseology in section 88 (1) is permissive (by the use of the word "may" ) its seems to me that there would need to be some very strong reason why a costs order should not be made once there is a finding of "special circumstances" warranting an award of costs. In Gulliver v General Manager , Maitland City Council (1999)NSWADT 67 the Tribunal said- (30) The respondent made an application for costs under s88 of the Administrative Decisions Act 1997 arguing that there were " special circumstances" warranting an award of costs. The circumstances allegedly included the fact that the respondent had been provided with all the documents in the council's possession in response to the applicant's applications under the FOI Act and that the respondent had written to the applicant requesting that he withdraw his application to the Tribunal. (31) The Applicant is not represented and has brought these proceedings in good faith. He had no legal advice about the prospects of success of his application. In these circumstances he should not be liable for costs. 24 With respect, the fact that an Applicant "is not represented", has brought the" proceedings in good faith" and/or "had no legal advice of the prospects of success" do not appear to me to be reasons for denying a successful respondent party its costs if otherwise entitled. It seems to me that the word "may" when used in section 88(1) is , in addition to conferring jurisdiction, permissive and there would have to be some disentitling factor(s) that would be sufficiently strong such that a party otherwise entitled to a costs order under section 88 would be denied that order. 25 Secondly, in my view the power to make costs order under section 88 is not confined to the entire case of the applicant , rather a costs order can be made in respect of part only of the case if the circumstances so warrant. In Prsa v Polymeris[2000] NSWADT 108 the Tribunal said: (23) While the applicant's claim was clearly flawed in law as to the failure to approve the new tenant , it was not so clearly flawed in the claim for breach of the covenant of quiet enjoyment. Accordingly it my view there are no " special circumstances" concerning the entire case warranting an order for costs. However I do accept the submission by the lawyer for the Lessor that the cost of obtaining the expert business evidence in reply was only necessary because the consent to assignment claim was pressed. Accordingly in my view the applicant should pay respondent's costs of retaining (the expert ) to prepare the report… 26 The Tribunal in Prsa clearly, and correctly in my view, permitted a costs order to be made for part only of the case because "special circumstances" were found in respect of that part of the case only. 27 The real question is: what are "special circumstances" in the context of the Retail Leases Act ? A starting point is Brooks Maher v Cheung [2001]NSWADT 18. Although this was an administrative law application the Tribunal indicated that it could "only make an award of costs if it is satisfied that there are special circumstances warranting an award of costs." The Tribunal then went on to analyse the phrase "special circumstances" and said this- (l1) (referring to Mangophah)The legislature has given a clear indication that the Tribunal is not to apply the usual approach to an unfettered discretion to award costs in judicial proceedings, ie that the successful party can expect to enjoy the benefit of a costs order. Something more than success is needed to warrant an order , whether the successful party is a citizen challenging an administration decision or an administrative agency resisting such a challenge. (12) " Special" is given 17 meanings in the Macquarie Dictionary , Third edition , The Macquarie Library . One meaning is "distinguished or different from what is ordinary: a special occasion." Another meaning is "extraordinary; exceptional; exceptional in amount or degree ,especial; special importance." In interpreting the term "special circumstances" in a different context, the Federal Court in Holpitt Pty Limited v Varimu Pty Limited (1991) 103 ALR 684 preferred the former definition. In my opinion the court's duty in application of this kind is to consider whether the applicant has shown some circumstances which takes the matter out of the ordinary course. (14) We are satisfied that the plain meaning "special circumstances" is circumstances which are out of the ordinary , without having to be extraordinary or exceptional. But "special circumstances" alone are not sufficient. Under s 88 (1) the special circumstances must "warrant an award of costs". The circumstances which would or would not "warrant an award of costs" can not be exhaustively listed. 28 With respect, I would agree that the interpretation of the word "special circumstances" is correctly set out Brooks Maher and does not require an applicant to satisfy the Tribunal that there is "something unusual or rare or outstanding and therefore special" which seems to be the test in Insley. 29 Consequently, I am of the opinion that in order to satisfy the test of "special circumstances" one must find circumstances that are out of the ordinary, but without having to be extraordinary or exceptional, and those special circumstances would warrant an award of costs. In other words, I agree with Brooks Maher that there are two hurdles for a costs applicant to overcome. 30 Each case depends upon on its own particular facts. In Mark Phillip Symonds (1995) 2 LPDR 10 a costs order was made in favour of the legal practitioner for reasons based substantially upon the conduct of the Law Society in bringing and maintaining the Complaint against him. Similarly, in Destination Travel Pty Limited v Travel Compensation Fund (2000) NSWADT 12 the Tribunal found "special circumstances" where the Fund adopted a policy of opposing stay applications mistakenly believing that criminal convictions involving a director of an Applicant would be relevant to its decision. The Fund conceded that it did not routinely oppose applications of the kind in question "and the only reason for (its) opposition in this case was evidence of (the director's) criminal record…that record is not relevant to any decision the (Fund) can make. (The Tribunal believes) that those administering the fund on a daily basis should have known that it was not their role to take into account a person's criminal convictions when making decisions about participation in the Fund. This conclusion is obvious even on a cursory reading of(the relevant legislation)… Consequently it was unreasonable for the (Fund) to put the applicant to the expense of a hearing when the stay application was opposed on that basis alone.". 31 In Hoblos v Marchese [1999] NSWADT 127 the Tribunal refused to find "special circumstances" and in support of its opinion relied upon numerous cases .The Tribunal correctly (in my respectful view) observed that the discretion under section 88 is not unfettered , required that the Tribunal "must take into account all the circumstances" and that the "discretion to displace (the ordinary rule that costs follow the event) is a judicial one requiring the private and public proposes of the rule to borne in mind." 32 In Hoblos the applicant failed to comply with initial directions, could give no reason why there was no compliance, failed to comply with a revised timetable , failed to appear on the adjourned date, failed again to comply with further directions , appeared on a further adjourned date but only by an agent with limited instructions who could make no submissions and ultimately the proceedings instituted by the applicant were in fact dismissed. The respondent, not surprisingly, applied for a costs order and submitted that there were in fact "special circumstances". The Tribunal , having considered the principles, declined to make an order for costs. This case Hoblos is often quoted in support of a proposition that in this Division orders for costs are rarely made. With respect to the Judicial Member who made the decision in Hoblos, I would respectfully disagree with the result. In seems to me that the circumstances as identified in the decision simply cried out for remedy as "special circumstances", in not dissimilar circumstances that confronted the Legal Profession Disciplinary Tribunal in Mark Phillip Symonds where the proceedings should not have been brought and the respondent was put to grossly unnecessary expense. 33 The Retail Leases Division of this Tribunal deals with commercial matters. All parties to a retail lease are parties engaged in trade and commerce for reward. As such they must be regarded as commercial persons and it is not to the point that one or either of them is unrepresented. Provided that "special circumstances" are found that would warrant the making of a costs order and there are no other disentitling factors, it seems to me that an order must be made. Indeed , the commerciality of this Division was identified in Colleja v Malli [2001] NSWADT 20 where the Tribunal made this observation: (49) The only other matter I need to address is the matter of costs. I have jurisdiction to award costs, but only where there are "special circumstances" and I am satisfied that the offer of Lease made by the Lessor that commencement of the second day's hearing was proper (and perhaps even generous) and amounts to "special circumstances". I note that the Respondent did not completely reject the offer and that time , but sought to further negotiate to terms even more generous , an approach which in my view at the time (and on mature consideration still was) so inappropriate that it amounted to a full rejection. Thus, (the) Applicant's costs of the last day's hearing (but not the costs of preparing for it) and the costs of making written submissions, all on a party / party basis must be borne with by the Respondent. 34 Clearly the Tribunal in Calleja identified the commerciality of retail leases and the Tribunal's role in dealing commercially and at law with matters bought before it. In my view the commerciality of this Division distinguishes the interpretation that should be given to the words "special circumstances" from any interpretation that may be given to those words in other Divisions in this Tribunal or in other contexts dealing with orders for costs under Acts other than the Retail Leases Act. Application of Principles: 35 It was plain that the parties in this matter were experienced operators in the retail leases milieu. The Applicant's directors were very experienced and conducted successful commercial businesses in the food business for quite a number of years and in varying locations. The Respondent was a commercial Lessor and employed a commercial property manager in respect of the premises. 36 It seems to me that the various aspects of the matter claimed the Applicant to constitute "special circumstances" generally fell within the general principle that "the matter falls within the aspect of litigation before the courts which is of a nature which the courts decide everyday"-see Lynch v Perpetual Trustees Australia Limited [2000] NSWADT 78 at para 42. 37 There are three aspects of the case which however in my view require to be especially addressed. 38 The first aspect is the submission by the Applicant generally to the effect that the case should not have been run by the Respondent, at least with regard to arguing the representations point, simply because it was to a major extent on the Respondent's own evidence that the representations were have been found to have been made , and against the Respondent. That is not discounting at all the evidence of the Applicant, rather it supports the argument that it was from the mouths of the Respondent's own witnesses that the Tribunal could find that the representations were in fact made. Therefore the case at least on that aspect should not have been run at all , rather the Respondent should have admitted that the representations had been made at the outset. 39 In my view that is a very persuasive argument and is clearly a factor that one would take into account in deciding whether there were "special circumstances" that would warrant a costs order being made. In my view to mount an argument which is directly opposite to the evidence of one's own witnesses is a circumstance which is "out of the ordinary" and may indeed "warrant an award of costs". After all, and I repeat, this is a Division that determines commercial disputes within the milieu of the Retail Leases Act. 40 The second aspect, and which has weighed heavily upon my mind, is that before the Lease was entered into the Respondent prepared and submitted to the Applicant a Disclosure Statement in compliance with the requirements Act. There was in the Disclosure Statement as prepared by the Respondent an acknowledgment by the directors of the Applicant by their signature to the Declaration by Lessee. The Disclosure Statement did not contain any reference at all to the representations agitated by Applicant and as found by me to have been made. 41 In my judgement 12 July 2001 I made the following observations: (35) I have therefore found that all three representations as contended by the Applicant have been made out . I should say that I have reached that conclusion without a great deal of difficulty. But in diffidence to the argument that was put by the Respondent in or to the effect that because the representations were not included in the disclosure statement, in addition or alternatively, were not part of the submissions made by the solicitor for the Applicant with respect to the terms of the Lease , then I could conclude that the representations were in fact not made. So, it was submitted, for example, in the disclosure statement the words appear: "Changes or Developments planned for the Lessor: nil". Again , the Disclosure Statement states: "Give details of any rights or obligations of Lessor under that Lease (referring to the Lessor ) that may affect the shop" and nothing appears thereafter. Later under the heading "Declaration by Lessor" there was a box providing for details of "any other agreements between the Lessor and Lessee or representations made by the Lessor or Lessee including those relation to exclusivity or limitation on competing uses" and nothing there appears as to any of the representations agitated by the Applicant. Furthermore, further down that page appears a "Declaration by Lessee" in which the Lessee, signed by Mr & Mrs O'Connor and dated 7 September 1999, "acknowledge that this Disclosure Statement contains all agreements and representations that influenced me to contemplate entering into the proposed lease". (36) From those items and the undoubted expertise of the O'Connors in entering into leases it was submitted that I could not conclude that there were representations made as alleged and it must follow that the Applicant was bound by those declarations. Indeed, it was submitted that the content of the Disclosure Statement amounted to a positive representation by the Applicant to the Respondent that the Disclosure Statement contained all the representations of the Respondent as Lessor. (37) I do not believe as a matter of law that is the case. One of the reasons for this case being now before this Tribunal is the failure by the Applicant and its directors/shareholders in ensuring that the Disclosure Statement was in fact correct as to the representations. However, I do not think it follows as a matter of law that because the representations as alleged are not in fact set out in the Disclosure Statement then I must find that the representations were not made at all. (38) It seems to me that all parties to a retail lease are bound to ensure that all disclosures and representations are properly set out in the Disclosure Statement and any consequent Lease such that there can be no room for argument. This Applicant, and its directors/shareholders, were experienced retail tenants. They should have known and should have insisted upon the representations being properly set out in both those documents. They have been said, however, it does not follow in my view that they are estopped from alleging the representations ,although it clearly does not assist their case by them having failed to include those representations as part of the Disclosure Statement and as part of the lease itself. (39) However, I am satisfied, and clearly satisfied , that the representations were in fact made by the Respondent as I have found above although the argument based on the Disclosure Statement and the Lease has force, in my view it is not an overriding argument such that I am precluded from making a finding otherwise. (40) The failure of the Applicant and the Respondent (for that matter) to set out in full in the Disclosure Statement and the Lease the full and complete terms of the representations and exclusivity of menu has undoubtedly contributed to this matter being so fully argued before me over two days, at no doubt considerable expense to each party. 42 It was submitted on behalf of the Applicant that the failure to include the representations the Disclosure Statement was a failure that cut both ways in that it was the Respondent that prepared it and omitted the representations it was the Applicant that signed it and also omitted the representations. 43 That argument has force. But the Applicant and/or its directors were an experienced lessee experienced in this type of tenancy and it was to the Applicant's advantage to make absolutely sure that the representations were properly and fully set out in the Disclosure Statement such that there could be no argument. It was the failure of both parties to ensure that the Disclosure Statement properly set out the representations in my view is a disentitling factor on the question of costs because it was to the Applicant's commercial advantage to ensure the Disclosure Statement (and perhaps also the Lease ) set out and fully and completely the representations (particularly those relating to exclusivity ) in a food court milieu that effectively created the litigation. 44 The word "may" in the context of section 88 may be regarded as conferring jurisdiction on this Tribunal and may also be regarded as permissive as distinct from mandatory. But once a finding is made that there are "special circumstances warranting an award of costs" in my opinion an award must be made unless there are disentitling circumstances of sufficient weight to negative the entitlement. It is clearly a weighing exercise and if the issues in this case stopped here then in my view no costs order would be made. 45 However, there is a third aspect of this litigation that must be put into the balance. The Applicant relied upon a affidavit of its solicitor which showed that prior to the proceedings being commenced the Applicant made an offer to settle at a figure less than ultimately ordered. During the proceedings themselves the Applicant made two further offers to settle , again in each case less than the amount ultimately ordered. In both cases such offers were either rejected or not replied to. In addition on the first day of the hearing the Respondent made an offer and again it was considerably less then the amount ultimately awarded. 46 In commercial matters offers to settle , where properly made, are matters to be taken into account on the question of costs. A party responding to such an offer needs to weigh up, by a cost–benefit analysis, the commercial desirability of proceeding with the litigation. Calderbank letters, formal offers of compromise and offers to settle are all matters to be weighed up in the balance. In this particular case the Applicant put forward three offers to settle, one prior to commencement of legal action, all of which were rejected, by silence or formal rejection. The Respondent's settlement offer was plainly inadequate and bore little or no relationship with the losses suffered by the Applicant. 47 In my opinion these factors coupled with those set out in paragraph 37 above outweigh by a considerable margin the disentitling factors set out in paragraphs 39-42 above such that in my view there are "special circumstances warranting an award for costs" in favour of the Applicant. 48 Having reached that conclusion the next question is: how are costs to be assessed ? Section 88 (2)(a) allows the Tribunal to determine by whom and to what extent costs are to be paid . In this case I determine that the Respondent should pay the Applicant's costs of the litigation. 49 Section 88 (2) (b) permits the Tribunal to order costs to be assessed on the basis set out in Division 6 of Part 11 of the Legal Profession Act 1987 or on an any other basis. The Act does not seem to say "by whom" costs are to be assessed. Subject to any submissions that may be made by the parties it seems to me that costs may be assessed by a Supreme Court Costs Assessor or by this Tribunal. In the latter case of I invite the parties to consider my decision in Law Society v Gallagher [1999] NSWADT 8 as to the relevant principles to be applied , and Caltex Refining Co.Pty.Ltd v Maritime Services Board of NSW (1995) 36 NSWLR 552. 50 I grant leave to the parties to re-list this matter on the question of how and by whom costs are to be assessed and the procedure to be adopted. However, I recommend that the parties negotiate and resolve the question of quantum without further costly argument. 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.