Supreme Court New South Wales Medium Neutral Citation: City Convenience Leasing Pty Limited v Boo [2015] NSWSC 1271 Hearing dates: 28 July 2015 Date of orders: 03 September 2015 Decision date: 03 September 2015 Jurisdiction: Common Law Before: Schmidt J Decision: (1) Leave to appeal is refused. (2) The usual order as to costs is that they follow the event. Unless the parties approach within 14 days that will be the Courts order. (3) All exhibits and subpoenaed material may be returned forthwith; any exhibits returned must be retained intact by the party or person that produced the material until the expiry of the time to file an appeal, or until any appeal has been determined. Catchwords: APPEAL – leave to appeal against a costs order – NCAT decision – jurisdiction – appeal does not raise a question of law – costs – leave to appeal is refused Legislation Cited: Administrative Decisions Tribunal Act 1997 (NSW) Civil and Administrative Tribunal Act 2013 (NSW) Retail Leases Act 1994 (NSW) Cases Cited: Brymount Pty Ltd t/a Watson Toyota v Cummins; Young Shire Council v Cummins (No 2) [2005] NSWCA 69 Charalambous v Yeung (No 2) (RLD) [2014] NSWCATAP 1 City Convenience Leasing Pty Ltd v Boo [2013] NSWADT 268 City Convenience Leasing Pty Ltd v Boo [2014] NSWCATAP 12 City Convenience Leasing Pty Ltd v Boo (No 2) [2014] NSWCATAP 55 Hazeldene's Chicken Farm Pty Ltd v Victorian House v The King [1936] HCA 40; (1936) 55 CLR 499 Irresistible Frocks Salon Pty Ltd v Sparbac Pty Ltd and Roche Group Pty Ltd (No 2) [2004] NSWADT 72 Jones v Bradley (No. 2) [2003] NSWCA 258 Kooee Communications Pty Ltd v Primus Telecommunications Pty Ltd (No. 2) [2008] NSWCA 85 Miwa Pty Ltd v Siantan Properties Pty Ltd (No 2) [2011] NSWCA 344 Prospect Resources Ltd v Molyneux [2015] NSWCA 171 SMEC Testing Services Pty Limited [2000] NSWCA 323 Thaina Town (On Goulburn) Pty Ltd v City of Sydney Council [2007] NSWCA 300; (2007) 71 NSWLR 230 WorkCover Authority (No 2) [2005] VSCA 298; 13 VR 435 Category: Principal judgment Parties: City Convenience Leasing Pty Limited (Plaintiff) Akau Boo (First Defendant) Vinh Quang Tran (Second Defendant) Kim Chau Tran (Third Defendant) Representation: Counsel: Mr AF Fernon (Plaintiff) Mr C Ireland (Defendants) Solicitors: Coleman Greig Lawyers (Defendant) File Number(s): 2014/319129 Publication restriction: None Judgment 1. City Convenience Leasing Pty Limited ("CCL") seeks leave to appeal a costs order made by the NSW Civil and Administrative Tribunal on 30 September 2014, requiring it to pay the defendants' costs of proceedings concerning a lease of premises at Hunter Street Sydney, owned by the defendants, where CCL operated a convenience store. 2. There was a disagreement over the rent. In November 2013 an application brought under the Retail Leases Act 1994 (NSW) came before the Retail Leases Division of the Administrative Decisions Tribunal, then constituted by Deputy President Callaghan, in accordance with the Administrative Decisions Tribunal Act 1997 (NSW). 3. The application was dismissed (see City Convenience Leasing Pty Ltd v Boo [2013] NSWADT 268). CCL's appeal from that decision was dismissed by the NCAT Appeal Panel, in a decision given on 7 April 2014 (see City Convenience Leasing Pty Ltd v Boo [2014] NSWCATAP 12). 4. The ADT was abolished on 1 January 2014 and its functions were taken over by NCAT and so the appeal proceedings were "unheard proceedings" as defined in cl 6(1) of Sch 1 of the Civil and Administrative Tribunal Act 2013 (NSW). Clauses 7(1) and 7(3)(b) of that Schedule required the proceedings to be heard by NCAT, as if that Act had not been enacted. 5. The question of costs, at first instance and on appeal, were dealt with by NCAT on the papers, in accordance with s 76 of the Administrative Decisions Tribunal Act on 30 September 2014 (see City Convenience Leasing Pty Ltd v Boo (No 2) [2014] NSWCATAP 55). CCL was ordered to pay the defendant's costs as from 17 September 2013, when it received a Calderbank offer. 6. In August 2006, CCL had leased ground floor premises in Hunter Street, Sydney owned by the defendants. It operated a convenience store there for an annual rent of some $285,000. The lease provided for a 5% annual rent increase and a market review in 2012, in accordance with a mechanism provided in clause 5. There was also an option to renew the lease, at the reviewed rent, increased by a further 5%, the new lease to commence in August 2013. 7. The rent review procedure was not implemented in 2012. In September and October 2012 rent was in arrears. The parties then entered into a payment plan agreement, which envisaged rent would be brought up to date by February 2013. 8. On the day before the lease was due to expire in August 2013, but after CCL had exercised the option to extend the lease, CCL filed an application under s 19(1) of the Retail Leases Act for appointment of a specialist retail valuer to determine "current market rent", the term used in clause 5 of the lease. It fell to the ADT to determine whether the defendants could object to the appointment of the valuer. 9. CCL was represented by an agent, Mr Soltan, who was not legally qualified. The defendants filed a motion seeking to have CCL's application struck out. On 13 September 2013, Mr Soltan wrote by email to the defendants' lawyers, inviting them to withdraw their objection to the appointment of the valuer, which it was claimed was vexatious and lacked merit, providing a basis for CCL to claim its costs under s 88 of the Administrative Decisions Tribunal Act. The defendants made a counter offer on 17 September, which was not accepted. When the matter came before the ADT on 19 September, directions were given for the filing of evidence and submissions. 10. The application was heard on 4 November. It was dismissed on 26 November. The appeal was dismissed on 7 April 2014, in part on different grounds. Costs were later ordered against CCL under s 88(1A) of the Administrative Decisions Tribunal Act, which provides: "88 Costs (1) Each party to proceedings before the Tribunal is to bear the party's own costs in the proceedings, except as provided by this section. (1A) 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 it is fair to do so having regard to the following: (a) whether a party has conducted the proceedings in a way that unnecessarily disadvantaged another party to the proceedings by conduct such as: (i) failing to comply with an order or direction of the Tribunal without reasonable excuse, or (ii) failing to comply with this Act, the regulations, the rules of the Tribunal or any relevant provision of the enactment under which the Tribunal has jurisdiction in relation to the proceedings, or (iii) asking for an adjournment as a result of a failure referred to in subparagraph (i) or (ii), or (iv) causing an adjournment, or (v) attempting to deceive another party or the Tribunal, or (vi) vexatiously conducting 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) any other matter that the Tribunal considers relevant. (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 a basis set out in Division 11 of Part 3.2 of the Legal Profession Act 2004 or on any other basis. (3) However, the Tribunal may 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." Jurisdiction 1. Under s 83 of the Civil and Administrative Tribunal Act 2013, an appeal lies to this Court, on questions of law, with leave. Under s 119(1A) of the Administrative Decisions Tribunal Act, as at 31 December 2013, an appeal on a question of costs lay to this Court, with leave. 2. Initially, the parties contended that the Court's jurisdiction to deal with these proceedings arose under Sch 1 of the Civil and Administrative Tribunal Act and thus had to be decided under s 119 of the Administrative Decisions Tribunal Act. It came to be common ground that jurisdiction was, in fact, conferred by s 83 of the Civil and Administrative Tribunal Act. That reflected that it is a decision of NCAT which is the subject of this appeal, a decision to which the transitional provisions of Sch 1 of the Civil and Administrative Tribunal Act do not apply. 3. That common ground reflects that at [6[ - [7] of the NCAT judgment, it was noted that the appeal had been heard as if the Civil and Administrative Tribunal Act had not been enacted. 4. That accorded with subclause (3)(b) of clause 7 "Pending proceedings before existing tribunals transfer to NCAT" of Subdivision 2 "Determination of pending proceedings" of Schedule 1 "Savings, transitional and other provisions" of the Civil and Administrative Tribunal Act. That provides that "unheard" proceedings' were to be heard by NCAT, as if "the provisions of any Act, statutory rule or other law that would have applied to or in respect of the proceedings had this Act and the relevant amending Acts not been enacted". 5. "Unheard proceedings" are defined in clause 6 of Schedule 1 to mean "pending proceedings that had not been heard before the establishment day by the court or existing tribunal in which the proceedings were instituted or commenced". 6. "Pending proceedings" are there defined to be: "proceedings (including appeals) that: (a) were instituted or commenced before the establishment day, and (b) have not been finally determined before that day by the court or existing tribunal in which the proceedings were instituted or commenced." 1. It follows that this appeal does not fall within these definitions, it having not been either instituted or commenced before the establishment day, which is 1 January 2014. 2. Clause 10 of the Schedule deals with "unexercised rights", defined in clause 6 to be: "… a right (including a right exercisable only with leave) that: (a) was available to be exercised immediately before the establishment day, and (b) had not yet been exercised before that day." 1. This appeal is not such a right, because it was not available to be exercised immediately before the establishment day, because the costs decision the subject of this appeal, had not then been given. 2. Accordingly, as the parties finally accepted, CCL may only appeal from NCAT's decision on a question of law, with the leave of the Court, as s 83 of the Civil and Administrative Tribunal Act provides. The appeal does not raise a question of law The costs decision 1. In its decision NCAT noted that the defendants sought costs in respect of their motion before the ADT, the interlocutory orders made in their favour by the ADT in January 2014 and the appeal determined by NCAT's appeal of 7 April 2014. 2. After referring to s 88 of the Administrative Decisions Tribunal Act and accepting that the proceedings had been complex as CCL argued, reference was made to a Calderbank offer made by the defendants by email sent to Mr Soltan on 17 September 2013. That email provided: "I am instructed to propose a, without admissions, counter offer that the rent increase at the option of the lease as from 18 August 2013 be reduced from 5% to 2.5%. This offer is open for acceptance until 4.00pm 18 September 2013." This settlement offer is made in a genuine attempt to resolve the issues between the parties and before substantial costs are incurred. This offer is made on the basis of the principles set out in Calderbank v Calderbank. I reserve the right to refer to this email on any issue of costs which may arise in any Court/Tribunal proceedings and to claim costs on an indemnity basis from the date of this email, should your client fail to achieve an outcome in the proceedings which is no more favourable than the terms of this offer." 1. There was no response to that counter offer. 2. NCAT accepted that the case which CCL had advanced called for careful examination and could not easily be put to one side (at [58]). In the result, it could not be concluded that s 88(1A)(c) and (d) had been triggered, there not being at first instance, or appeal a substantial disparity between the relative strengths of the parties' claims (at [61])). It was concluded, however, that CCL's application for interlocutory relief had not been soundly based (see at [62] - [65]). 3. It was, however, accepted to be well recognised that the unreasonable rejection by an unsuccessful party of an offer of settlement on terms more favourable than the order ultimately made in the proceedings, may be treated as a relevant consideration under paragraph (e) of section 88(1A) and may provide the basis for a costs order (Charalambous v Yeung (No 2) (RLD) [2014] NSWCATAP 1 at [21]). 4. It was noted that the offer was made by the defendants' solicitors in the email message sent to Mr Soltan at 3.27 p.m. on Tuesday 17 September 2013, rejecting CCL's offer made in the email Mr Soltan sent on Friday 13 September. The defendants' offer lapsed at 4.00 pm on 18 September 2013. There was a directions hearing the next day 19 September 2013. 5. At [70], NCAT noted that the defendants had argued that the "amount to be achieved by the Application" was at that stage "under active consideration" by CCL. It followed, they maintained, that CCL's rejection of their offer was unreasonable and that "an appropriate costs order" should therefore be made in their favour. 6. It was also noted that CCL maintained that the 17 September offer was "not a Calderbank v Calderbank offer" and could not be invoked as a basis for a costs order in their favour, because firstly, the time it was given to consider the offer was only 24 hours, which was insufficient to allow Mr Soltan to advise it as to the legal consequences of the offer, or to obtain relevant legal advice. Secondly, the offer did not "deal with the Application that was before the Tribunal", with "the rent [that] may have been overpaid or underpaid for the year ending 17 August 2013", or with "the costs of the application", but only the option lease (see at [71] - [73]). 7. CCL also relied on an offer of settlement made on 13 February 2014, between the delivery of the Tribunal's decision and the commencement of the appeal hearing. The terms of the offer were that if the defendants consented to the appointment of a specialist retail valuer, it would not require the payment of any rent overpaid to them between 18 August 2012 and 23 January 2014 (on which date they had sold the premises to a third party). 8. After referring to authorities cited by the parties, Jones v Bradley (No 2) [2003] NSWCA 258; Charalambous v Yeung (No 2); Brymount Pty Ltd t/a Watson Toyota v Cummins; Young Shire Council v Cummins (No 2) [2005] NSWCA 69 at [14]; SMEC Testing Services Pty Ltd [2000] NSWCA 323, it was concluded at [80] - [90]: "80 Discussion and conclusions. A costs order under section 88(1A) may only be based on the rejection of an offer of compromise if the following conditions are satisfied: (a) the terms offered constitute a genuine compromise of the dispute between the parties; (b) they are more favourable to the offeree than the outcome of the proceedings; and (c) having regard to all the circumstances, the offeree's rejection of the offer was unreasonable. 81 The Respondents' offer of 17 September 2013 had the effect of halving the amount of the rent increase that took effect on the exercise of the option. It envisaged an increase of 2.5% instead of the contractual rate of 5%. According to their case, which the Tribunal and the Appeal Panel ultimately upheld, the monthly rent payable during the final year of the initial term, constituting also the current market rent, was $31,827.27 plus GST, which amounts to $35,010. When the contractual rate of 5% is applied to this figure, the amount of the increase during the first year of the renewed lease is $1750.50. 82 Acceptance of the Respondents' offer would have reduced this amount by $875.25 per month, which translates to $10,503 per annum. This reduction would have affected the amount payable as rent not only during the first year of the renewed term, but also during the each of the remaining six years. This follows from the fact that under the Lease an annual increase of 5% takes place throughout the renewed term. Accordingly, the offer conveyed by the Respondents, when compared to the amount of rent being sought by them during the seven years of the renewed term, involved a long-term benefit to the Applicant amounting to more than $70,000. 83 This analysis shows that the first two of the three conditions outlined above were satisfied. The Respondents' offer made on 17 September 2013 was both (a) a genuine compromise of the dispute and (b) distinctly more favourable to the Applicant than the outcome of the proceedings. 84 As to the third condition - that having regard to all the circumstances, the rejection was unreasonable - the chief matter to be investigated is whether sufficient time was afforded to the Applicant to give due consideration to the offer. 85 The Applicant maintained that the period of time allowed - little more than 24 hours - was insufficient. But the evidence that it tendered to the Tribunal included a copy, annexed to a witness statement signed by Mr Soltan, of the offer of settlement (referred to above at [68]) that the Applicant had made on 13 September 2013. The email message in which this offer was conveyed by Mr Soltan to Greig Coleman included the following passages:- We have carefully reviewed the correspondences, the lease document, the applicable statute and case law related to the issue, and can confirm that your clients' claim that our client is estopped from asserting that market rent as at 18 August 2012 has not been agreed upon, has no basis in fact or law and there is 'substantial disparity' between your clients' claim and ours. The six elements needed to establish estoppel are simply not there... We are of the opinion that your objection is vexatious and substantially lacks merits... 86 The focus of the first of these extracts from Mr Soltan's email is on the specific question of estoppel. But the two extracts, considered in conjunction with the fact that in this email the Applicant made its own offer of settlement, indicate that at the time when it received the Respondents' counter-offer it was giving 'active consideration' to the case that it would advance in the forthcoming proceedings. A further factor supporting this conclusion is that the matter was set down for directions two days later. It follows that the period of time afforded to the Applicant to consider the offer was not unduly short. 87 For these reasons, the Applicant's rejection of the Respondents' offer of compromise was, in all the circumstances, unreasonable. 88 The offer of settlement made by the Applicant on 13 February 2014 does not assist its case because its terms were less favourable to the Respondents than the outcome of the proceedings. 89 The Respondents have accordingly succeeded in showing that the Applicant's rejection of their offer of compromise provides a proper basis for a finding that it would be 'fair', within the meaning of section 88(1A) of the ADT Act, to order the Applicant to pay their costs as from 17 September 2013, the date when the offer was conveyed. 90 The Appeal Panel's conclusion is that such an order should be made. The costs should be paid on a party/party basis, in an amount to be agreed or assessed. Given the scale of the costs involved, the Panel will not determine a fixed sum, even though it is empowered to do this in appropriate circumstances." The parties' cases 1. CCL contended that these reasons revealed that thereby the costs discretion had miscarried. The defendants' offer had been made in proceedings without pleadings, at a time when evidence had not been served and there was no hearing pending. NCAT had erred in concluding that there had been an offer of settlement made by CCL on 13 September. There was then no active consideration being given to the issues and risks associated with the litigation and it had been given no reasonable opportunity to obtain legal advice, or consider the merits of accepting the offer. 2. The result was, CCL argued, that the question of costs had been determined on an erroneous factual basis and without proper application of the applicable principles, amounting to error of the kind discussed in House v The King [1936] HCA 40; (1936) 55 CLR 499. Both the evidence had been misunderstood and the principles misapplied. Had those errors not been made, the primary position under s 88, that each party bears its own costs, would not have been departed from. 3. The defendants contended that these alleged errors had not been made and in any event, did not amount to an error of law. Further, that the arguments advanced impermissibly departed from the grounds advanced in the summons. What was pursued was dissatisfaction with the exercise of the costs discretion, which did not amount to an error of the kind discussed in House v R, that is, a result that is so unreasonable or so unjust that an error of principle in approaching the matter of costs must be inferred. 4. Further, even if such an error had been made, the costs order would not be disturbed because there were other reasons for making that order, consistently with the requirements of s 88. There was no error of fact or law 1. It is apparent from the reasons given, that NCAT took the view that it was CCL who had raised the question of settlement by the email sent on 13 September and that it had been unreasonable for CCL not to have accepted the counter offer which the defendants made on 17 September, two days before the directions hearing on 19 September. That involved no factual error. 2. Those conclusions reflected the terms of Mr Soltan's 13 September email which said: "We refer to the above matter and note that as a result of your client [sic] allegations that there was agreement by our client on the market rent as at 18 August 2012, the matter is now listed for directions before the Tribunal on 19 September 2013. We also note that on 4 September 2013 you provided us with the correspondences which your clients rely upon in claiming that our client is estopped from asserting that the market rent has not been agreed upon. We have carefully reviewed the correspondences, the lease document, the applicable statute and case law related to the issue, and can confirm that your clients' claim that our client is estopped from asserting that market rent as at 18 August 2012 has not been agreed upon, has no basis in fact or law and there is "substantial disparity" between your clients' claim and ours. The six elements needed to establish estoppel are simply not there. We are writing to you to invite you to withdraw your objection to the Tribunal appointing a specialist retail valuer in accordance with our client application and the provisions of the Retail Leases Act (NSW) 1994 ("the RL Act") by 4pm Tuesday 17 August 2013. If you fail to withdraw your objection and the Tribunal end up dismissing your objection, we put you on notice that our client will be seeking his costs of the direction [sic] hearing on 19 September 2013 and any incidental work performed by our firm in resisting your clients' objection. We are of the opinion that your objection is vexatious and substantially lacks merits which provide a ground for our client to seek his costs under s.88(1A)(a)(vi), s.88(1A)(b) and s.88(1A)(c) of the Administrative Decisions Tribunal Act 1997 ("the ADT'). We also refer you to a recent decision by the Appeal Panel of the Tribunal in Fathullah v Varma (RLD) [2013] NSWADTAP 39 where our firm acted successfully in two joint appeal [sic] at [143]-[152]. In that passage the Appeal Panel confirmed that "costs" within s.88 of the ADT Act includes professional fees that are payable to a lay advocate who is not an Australian Legal Practitioner. We put you on notice that our client signed a costs agreement with our firm in this matter that stipulated an hourly rate of $450 payable for any work done by us in the Tribunal. Our client will seek to recover these costs from your client if it is successful in resisting your objection. We trust that your clients will be prudent and withdraw their objection by the time stipulated in this email. You can inform us that you agree for the Tribunal to appoint a specialist retail valuer to determine the market rent as at 18 August 2012 pusrant [sic] to s. 19 of the RL Act. We will then write to the Tribunal or attend the direction [sic] hearing on 19 August 2013 to inform the Tribunal with the agreement in which our client will not seek its costs, but that only if you agree by 4pm Tuesday 17 August 2013." 1. There is no rule precluding efforts at early settlement being pursued, as the parties did, prior to the directions hearing at which they were directed to file and serve their evidence. Even an offer which amounts to capitulation, such as that made by CCL on 13 September can later, in an appropriate case, be relied on by a party seeking a departure from the usual costs order (see Prospect Resources Ltd v Molyneux [2015] NSWCA 171 at [93] - [96]). 2. The defendants' counter offer was not such an offer. To the contrary, CCL having advised the defendants on 13 September of its readiness to settle on the basis that their objection to its claim be withdrawn, after Mr Soltan advised that he had given consideration to the case they were advancing, the defendants made a very substantial counter offer, as NCAT explained at [81]-[82] of its decision. There was no other suggestion in these proceedings that this conclusion was wrong. 3. There was also no error of law in NCAT's articulation of what had to be considered, in determining whether there should be a departure from the usual costs order under s 88, as the result of the rejection of the defendants' counter offer. 4. It was open to NCAT to find that the counter offer was both a genuine compromise of the dispute and one which proved to be more favourable to CCL than the outcome of the proceedings, either initially, or on appeal, CCL having failed to establish its case both at first instance and on appeal, albeit on different grounds. 5. As discussed in Kooee Communications Pty Ltd v Primus Telecommunications Pty Ltd (No. 2) [2008] NSWCA 85 at [22]: " … The question of reasonableness must be judged objectively, in the circumstances known, or which should reasonably have been anticipated, by both parties. In setting the time during which the offer is to remain open, the offeror must necessarily rely upon the circumstances as known to it, or which should reasonably be anticipated by it. The actual circumstances of the recipient, unknown to the offeror, may be relevant to an application that the Court otherwise order in relation to costs of a valid unaccepted offer, but so might evidence as to whether the recipient took any steps to bring such matters to the notice of the offeror." 1. CCL led no evidence as to such matters. 2. The approach adopted by NCAT accorded with that discussed in Miwa Pty Ltd v Siantan Properties Pty Ltd (No 2) [2011] NSWCA 344 at [7] - [9]. As there discussed at [11] – [15], what must be considered in determining whether an offeree was unreasonable in refusing an offer, the response of the offeree must be assessed at the time the offer was made, and not with the benefit of hindsight, resulting from a known outcome. The matters identified in Hazeldene's Chicken Farm Pty Ltd v Victorian WorkCover Authority (No 2) [2005] VSCA 298; (2005) 13 VR 435 must also be considered in determining whether the rejection of the offer was unreasonable. They are: "(a) the stage of the proceeding at which the offer was received; (b) the time allowed to the offeree to consider the offer; (c) the extent of the compromise offered; (d) the offeree's prospects of success, assessed as at the date of the offer; (e) the clarity with which the terms of the offer were expressed; (f) whether the offer foreshadowed an application for indemnity costs in the event of the offeree's rejecting it." 1. In concluding that CCL had been unreasonable in rejecting the counter offer the defendants made prior to the directions hearing, NCAT took the view that this turned on whether sufficient time was afforded to CCL to give due consideration to the offer. 2. There was also no error in this approach, even though at the time of the settlement discussions the parties had not served their evidence. The proceedings had been commenced in August. The parties had made their offers in the context of their ongoing communications about their respective cases. That was the factual context in which the question of unreasonableness arose to be determined. 3. The extent of the compromise which the defendants offered, to which there was no response, or any suggestion that more time was needed to consider it, was consistent with CCL then having an understanding of the nature of the counter offer which the defendants had made. 4. NCAT took the view that in the particular circumstances, the time that the offer was open was not unduly short, given that CCL was then giving active consideration to the question of settlement. 5. That conclusion rested on Mr Soltan's 13 September email, which revealed that CCL took the view that it had significant prospects of success and that the defendants did not. Given what lay in issue between the parties as to the application of the market rent review clause and the claim for the appointment of a specialist valuer, the claimed agreement as to rent and the defendants' estoppel claims, when it received the counter offer on 17 September, CCL could not have reasonably approached it on the basis that the case which the defendants were advancing had no merits, but still there was no response to the offer or any suggestions that further time was needed to consider it. 6. That conclusion followed the approach taken in Jones v Bradley (No 2) at [16], where a counter offer made on the Friday before the commencement of a trial, which was kept open for only half a working day, was found to have been unreasonably refused. 7. A similar approach was taken in Irresistible Frocks Salon Pty Ltd v Sparbac Pty Ltd and Roche Group Pty Ltd (No 2) [2004] NSWADT 72 at [29] – [31], where two business days had been given to consider an offer made even before proceedings were instigated. There correspondence between the parties also established that settlement was being actively considered. It had even there been suggested by the offeree that the time frame given was unrealistic, but still a counter offer was made within the time provided. 8. Here there was no such suggestion. The counter offer made to CCL on 17 September was open until 4 pm on the 18 September, before the directions hearing on 19 September, after which the parties would begin incurring considerable expenses in preparing the matter for hearing. 9. As discussed in Thaina Town (On Goulburn) Pty Ltd v City of Sydney Council [2007] NSWCA 300; (2007) 71 NSWLR 230, there is a difference between failing to take into account a relevant consideration and the weight which such a consideration is given in the exercise of a discretion (see at [54]). 10. Even if, as a matter of discretion, a different view could have been taken on the facts, CCL has not established that NCAT's conclusion that it had been unreasonable in rejecting the defendants' offer involved any error of law. The conclusions reached do not evince legal unreasonableness of the kind discussed in Minister for Immigration and Citizenship v Li [2013] HCA 18; 249 CLR 332. There it was observed at [75] – [76]: "75 In Peko-Wallsend, Mason J, having observed that there was considerable diversity in the application by the courts of the test of manifest unreasonableness, suggested that "guidance may be found in the close analogy between judicial review of administrative action and appellate review of a judicial discretion". House v The King holds that it is not enough that an appellate court would have taken a different course. What must be evident is that some error has been made in exercising the discretion, such as where a judge acts on a wrong principle or takes irrelevant matters into consideration. The analogy with the approach taken in an administrative law context is apparent. 76 As to the inferences that may be drawn by an appellate court, it was said in House v The King that an appellate court may infer that in some way there has been a failure properly to exercise the discretion "if upon the facts [the result] is unreasonable or plainly unjust". The same reasoning might apply to the review of the exercise of a statutory discretion, where unreasonableness is an inference drawn from the facts and from the matters falling for consideration in the exercise of the statutory power. Even where some reasons have been provided, as is the case here, it may nevertheless not be possible for a court to comprehend how the decision was arrived at. Unreasonableness is a conclusion which may be applied to a decision which lacks an evident and intelligible justification. [citations omitted]" 1. Unreasonableness of this nature has not here been established. In the result, CCL has not established that its case raises a question of law. Accordingly, the leave sought must be refused. Costs 1. The usual order as to costs is that they follow the event. Unless the parties approach within 14 days, that will be the Courts order. Orders 1. For the reasons given, I order that: 1. Leave to appeal is refused. 2. The usual order as to costs is that they follow the event. Unless the parties approach within 14 days, that will be the Courts order. 3. All exhibits and subpoenaed material may be returned forthwith; any exhibits returned must be retained intact by the party or person that produced the material until the expiry of the time to file an appeal, or until any appeal has been determined. 4. ********** 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: 03 September 2015