Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Lewisham Estates Pty Ltd v LMW Advisory Group Pty Ltd [2014] NSWCATCD 95 Hearing dates: 20 and 21 March 2014 Decision date: 06 June 2014 Before: S Thode, Senior Member Decision: 1.The respondent shall pay the applicant's costs of the application COM 12/50563 on the ordinary basis as agreed or assessed. Such costs include the cost of the Notice of Motion to adduce further evidence. Category: Principal judgment Parties: Lewisham Estates Pty Ltd (applicant) LMW Advisory Group Pty Ltd (respondent) File Number(s): COM 12/50563 REASONS FOR DECISION The proceedings 1 The applicant sought declaratory relief pursuant to section 8 of the Consumer Claims Act 1998 that it did not have to pay commission in the sum of $533,500.00 to the respondent. 2 The hearing spanned two days on 11 and 12 March 2014. The decision was reserved. On 20 March 2014 the respondent sought leave to re-open to adduce further evidence. The motion was heard on 20 March 2014 and that decision was reserved also. 3 On 6 May 2014 the Tribunal published its orders granting the declaratory relief sought. The notice of motion was dismissed. 4 The applicant submitted that the respondent was wholly unsuccessful and that costs should follow the event. 5 The respondent cited the CTTT authority of Gigliotti Constructions Pty Ltd v Lancuba (Home Building) [2010] NSWCTTT 263 (17 June 2010). The Tribunal found that where a party was justified to maintain its position in proceedings, and conducts itself reasonably, the Tribunal may decide to not exercise its discretion and make no costs order. 6 The respondent submitted that it was entirely justified and acted reasonably and that it was entitled to maintain its defence until final hearing. It was a reasonable position to maintain that an agency agreement had been formed, or in the alternative, that the respondent should be entitled to recover the commission despite a failure to serve an agency agreement in accordance with the Property Stock and Business Agents Act 2002 (NSW). It is further submitted that the question as to whether an agreement had been entered into between the parties and whether the requirements of the Act had been met were not clear on the documentary evidence filed and were issues "that required ventilation at a hearing due to a conflict in recollection by both parties." 7 It was further submitted that it was reasonable for the respondent to bring the matter to a hearing in light of the fact that the Tribunal's decision was based on preference of oral evidence presented by one party over the other. 8 Further, costs of the motion should not be borne by the respondent. The Tribunal had indicated it was a contributing factor in its decision not to allow further evidence, as it had already formed the view that further evidence would be otiose in light of its primary finding that no Agency Agreement had been formed. The respondent could not have known that the Tribunal had formed a view and it was therefore reasonable to move the Tribunal for further orders on the issue of inadvertence. 9 For these reasons the respondent submitted there should be no order as to costs. Findings and Decisions 10 This matter was determined by the Consumer, Trader and Tenancy Tribunal when the CTTT Act and the CTTT Regulation were in force. The Consumer Trader and Tenancy Tribunal was abolished as of 1 January 2014 and the CTTT Act and Regulation were repealed. As the issue of costs was not determined at the time the substantive issues were decided, the proceedings are incomplete. 11 Transitional provisions in relation to part heard (that is, incomplete proceedings) are set out in Clause 7 of Schedule 1 of the NCAT Act. Pursuant to Clause 7(3), the current Tribunal has and may exercise all the functions that the CTTT had immediately before its abolition, and the provisions of the CTTT Act and Regulation continue to apply to incomplete proceedings. 12 The relevant provisions in relation to costs are accordingly section 53 of the CTTT Act and in Clause 20 of the CTTT Regulation. Clause 20(4) of the Regulation states that in any proceedings in respect of which the amount claimed or in dispute is more than $30,000.00, the Tribunal may award costs "in such circumstances as it thinks fit". The declaratory relief claimed was well in excess of $30,000.00. 13 The Tribunal therefore has a wide discretion in relation to making an order for costs. 53 Costs Subject to this section and the regulations, the parties in any proceedings are to pay their own costs. The Tribunal may, in accordance with the regulations, award costs in relation to any proceedings. If costs are to be awarded by the Tribunal in accordance with the regulations, the Tribunal may: determine by whom and to what extent costs are to be paid, and order costs to be assessed on the basis set out in Division 11 of Part 3.2 of the Legal Profession Act 2004 or on any other basis. In this section, "costs" includes the costs of, or incidental to, proceedings. 14 Clause 20(4) is of particular relevance: "In any proceedings in respect of which the amount claimed or in dispute is more than $30,000 the Tribunal may award costs in relation to the proceedings in such circumstances as it thinks fit. " 15 I accept the respondent's submission that it was entitled to maintain its defences and that a hearing including cross-examination of the parties was necessarily required to assist the Tribunal in coming to its findings. However, the applicant was wholly successful in its case. 16 Although an award as to costs is always in the discretion of the Tribunal, Regulation 20 creates an expectation that costs will "follow the event", the event being a matter where the claim made exceeded $30,000.00. In cases over $30,000.00 the Tribunal may, in the exercise of its discretion, follow and adopt the general law position that a successful party has a "reasonable expectation" of being awarded costs against the unsuccessful party: Oshlack v Richmond River Council (1998) 193 CLR 72 at [67] and [134]. The purpose of an order for costs is to compensate the person in whose favour it is made and not to punish the person against whom the order is made: Allplastics Engineering Pty Ltd v Dornoch Ltd [2006] NSWCA. 17 I am satisfied that the applicant was wholly successful in its claim against the respondent and succeeded in obtaining the declaratory relief sought. I am further satisfied that the notice of motion, was determined in favour of the applicant not because the Tribunal had already reached its conclusions, but because the issues between the parties had been pleaded and well ventilated for a number of years. Points of claim filed on 12 December 2012 squarely raised the section 55 issue. In light of these matters the Tribunal declined leave to re-open to allow further evidence on the issue of inadvertence. 18 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 terms, a party who is successful is entitled to an order for costs in its favour, subject to certain limited exceptions generally involving misconduct on the part of that party. (See, for example, Latoudis v Casey [1990] HCA 59; [1990] 170 CLR 534 and Oshlak v Richmond River Council [1998] HCA 11) 19 Adopting these well-known principles, the Tribunal is satisfied that the applicant, as the successful party, is entitled to an order for costs. There is no suggestion that there was misconduct during the proceedings which would preclude the applicant from being awarded costs of the application on the usual basis. 20 For the reasons set out above it must follow that the respondent should also be ordered to pay the applicant's costs in relation to the notice of motion. 21 Accordingly, I make the orders in paragraph one above. S Thode Senior Member Civil and Administrative Tribunal of New South Wales 6 June 2014 ********** 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: 21 August 2014