Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Channell v Graham [2017] NSWCATAP 129 Hearing dates: 7 March 2017 Date of orders: 09 June 2017 Decision date: 09 June 2017 Jurisdiction: Appeal Panel Before: S Westgarth, Deputy President I Bailey, Senior Member Decision: (1) A hearing on costs is dispensed with pursuant to s 50(1)(c) of the Civil and Administrative Tribunal Act 2013; and (2) The appellant is to pay the respondent's costs of and incidental to the appeal in an amount to be agreed or assessed Catchwords: COSTS – Rules 38 and 38A - Reg 20(4) – withdrawal of appeal Legislation Cited: Civil and Administrative Tribunal Act 2013 Civil and Administrative Tribunal Rules 2013 Consumer, Trader and Tenancy Act 2001 Consumer, Trader and Tenancy Regulation 2009 Home Building Act 1989 Cases Cited: Solomons v Valley Motor Auctions Pty Ltd [2017] NSWCATAP 31 Category: Costs Parties: Irene Channell (Appellant) Roberta Graham ( Respondent) Representation: Counsel: L Gor (for costs applicant/respondent) A Bryne (for costs respondent/appellant) Solicitors: J S Mueller & Co (for costs applicant/respondent) Thirlow Fisher (for costs respondent/appellant) File Number(s): AP 16/47497 Publication restriction: Unrestricted Decision under appeal Court or tribunal: Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Citation: Not applicable Date of Decision: 29 September 2016 Before: D Goldstein, Senior Member File Number(s): HB 12/53320 reasons for decision Background 1. This decision concerns an appeal from a decision made in the Consumer and Commercial Division of the Tribunal published on 29 September 2016 ('the Decision'). The appeal has been withdrawn and we now have before us an application for an order that costs of the appeal be paid by the appellant. The appellant opposes that order and submits that there should be no order as to costs. 2. The appellant was the applicant in the first instance proceedings and the orders made by the Tribunal as recorded in the Decision were that the appellant's application was dismissed. In addition, directions were made for the parties to make submissions concerning costs. 3. The appellant filed a Notice of Appeal on 27 October 2016. The respondent filed a Reply to Appeal and the appeal proceeded to a call over which was held on 6 December 2016. Directions were made at the call over for the parties to exchange material and evidence in support of and in opposition to the appeal. Orders were made on that occasion varying the directions made at first instance for the filing of submissions concerning costs. The variations concerned the dates for the parties to file their respective submissions. The appellant thereafter filed submissions in support of the appeal. 4. At the call over the appeal was given a hearing date of 7 March 2017. On that date, orders were made by consent for the appeal to be adjourned and directions were made for time to be extended for the parties to file and serve submissions and evidence. In addition, by consent, costs were reserved and the directions concerning costs made in the proceedings below were set aside. Finally, by consent, the costs application in the proceedings below was remitted to the Member who had heard the proceedings at first instance for his decision concerning costs. 5. On 30 March 2017, the Appeal Panel dismissed the appeal under s 55(1)(a) of the Civil and Administrative Tribunal Act 2013 (NCAT Act). That section provides that the Tribunal may dismiss proceedings if the applicant or appellant withdraws the application or appeal. In addition, orders were made for the respondent to file and serve submissions concerning costs of the appeal within 21 days and for the appellant to file and serve submissions on costs of the appeal in response to the respondent's submissions within a further period of 21 days. The order required the parties to include submissions as to whether the Appeal Panel may deal with the question of costs on the papers without a hearing. 6. The respondent has filed and served her submissions concerning costs of the appeal. The appellant has also filed submissions which include consent to the Tribunal determining the question of costs on the papers. 7. The respondent has not filed a submission concerning whether we should make an order dispensing with a hearing and decide the question of costs on the papers. We are of the opinion that a hearing is not required based upon the written submissions and we propose to decide the question of costs on the papers. We will make an order dispensing with a hearing (see s 50 of the NCAT Act). The Respondent's Submissions on Costs 1. The respondent now seeks an order that her costs of, and incidental to, the appeal be paid by the appellant in an amount to be agreed or assessed. 2. The first basis for the respondent's application is that there is no reason to depart from the general or usual rule that "costs follow the event". The second basis is that the respondent submits that the appellant's appeal was misconceived and "hopeless from the outset". The third basis is that the appellant did not accept a Calderbank offer in circumstances where the respondent made a very significant compromise which she has bettered in the appeal. 3. The respondent submitted that the appellant's application concerned a claim for damages and alleged overcharging totalling an amount in excess of $108,000.00. 4. The respondent's submissions set out the legislative framework relevant to the question of whether an order for costs should be paid. In particular, references are made to, and the respondent relies upon r 38A and r 38 of the Civil and Administrative Tribunal Rules 2013 (the Rules). Appellant's Submissions 1. The appellant's submissions may be summarised in these terms: 1. The appellant sought to vindicate a home building claim which she believed to be meritorious on the basis of advice received from her former solicitors and counsel; 2. The appellant proactively sought fresh advice as to the merits of the appeal from new solicitors and counsel; 3. On the basis of fresh advice the appellant withdrew the appeal at an early opportunity; and 4. The respondent "in principle" did not object to the withdrawal of the appeal, thereby constructively consenting to the discontinuance of the appeal. 1. In addition, the appellant responds to the respondent's submissions as follows: 1. With respect to the principle that "costs follow the event", the event in this case did not happen. In other words, there was no substantive determination of the appeal. The appellant withdrew the appeal at an early stage ensuring that the respondent did not incur additional costs and Tribunal resources were not wasted; 2. In addition, the merits of the appellant's appeal were not ultimately determined because the appeal was withdrawn; and 3. Thirdly, it was not unreasonable for the appellant not to accept an offer of compromise at such an early stage of the appeal. Consideration 1. The proceedings giving rise to this appeal were commenced in 2012 in the Consumer, Trader and Tenancy Tribunal (CTTT), which was abolished as at 1 January 2014. As the Decision makes clear, the appellant's application was not fully determined as of 1 January 2014 and that therefore, the proceedings became "unheard proceedings" as defined in cl 6 of Sch 1 of the NCAT Act. Transitional proceedings in relation to unheard proceedings are set out in cl 7 of Sch 1 of the NCAT Act. Clause 7(3) of Sch 1 provides that this Tribunal has and may exercise all of the functions that the CTTT had immediately before its abolition. 2. We note that the Member at first instance has made orders with respect to costs and, in doing so, has applied the provisions of s 53 of the Consumer, Trader and Tenancy Act 2001 (CTTT Act) and reg 20(4) of the Consumer, Trader and Tenancy Regulation 2009 (CTTT Regulation). That regulation provides 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 relation to the proceedings in such circumstances as it thinks fit 1. A question arises in this appeal as to whether we are applying reg 20(4) of the CTTT Regulation or whether we are applying rr 38 and 38A of the Rules. 2. Rule 38A provides that where an internal appeal has been lodged on or after 1 January 2016 (which is the case with respect to this appeal) and if the provisions that apply to determination of costs in the proceedings of a Tribunal at first instance differed from those set out in s 60 of the NCAT Act because of the operation of enabling legislation, or the Division Schedule for the Division of the Tribunal concerned, or the procedural rules then, despite s60, the Appeal Panel must apply the first instance cost provisions when deciding whether to award costs in relation to the internal appeal. 3. Here, the provisions that apply to the determination of costs in the proceedings of the Tribunal at first instance differed from those set out in s60 of the NCAT Act. In the circumstances of this matter, those provisions are to be found in reg 20(4) of the CTTT Regulation. 4. Rule 38 provides: 38 Costs in Consumer and Commercial Division of the Tribunal (1) This rule applies to proceedings for the exercise of functions of the Tribunal that are allocated to the Consumer and Commercial Division of the Tribunal. (2) Despite section 60 of the Act, the Tribunal may award costs in proceedings to which this rule applies even in the absence of special circumstances warranting such an award if: (a) the amount claimed or in dispute in the proceedings is more than $10,000 but not more than $30,000 and the Tribunal has made an order under clause 10 (2) of Schedule 4 to the Act in relation to the proceedings, or (b) the amount claimed or in dispute in the proceedings is more than $30,000. 1. In this case, the amount claimed or in dispute was more than $30,000.00. It can be seen that the substance of reg 20(4) of the CTTT Regulation and r 38 of the Rules is the same and accordingly, it is not necessary for us to decide upon which basis we are to consider the respondent's application for costs of the appeal. In our view, on both bases the respondent is entitled to an order for costs of the appeal for the reasons which follow. 2. In our view, it is appropriate to make an order that the appellant pay the respondent's costs of the appeal. The appellant initiated the appeal and the consequence of that was that the respondent was put to some expense in considering how she would respond to the appeal and in complying with the directions made by the Appeal Panel. The appeal was then withdrawn. There was no disentitling conduct by the respondent. 3. The fact that the merits of the appeal have not been determined (because of the withdrawal and consequent dismissal) does not result in the appellant avoiding an order for costs of the appeal. The "event" is constituted by the dismissal. This view is consistent with that expressed in Solomons v Valley Motor Auctions Pty Ltd [2017] NSWCATAP 31. 4. We do not accept the appellant's argument that the respondent consented to the discontinuance of the appeal. The respondent's letter of 28 March 2017 makes it clear that the respondent did not object to the withdrawal of the appeal but that she did wish to seek costs. The consent to withdrawal was clearly on terms that costs would be sought. 5. Accordingly, we propose to make the order requested by the respondent and therefore make the following orders. Orders 1. The Appeal Panel makes the following orders: 1. A hearing on costs is dispensed with pursuant to s 50(1)(c) of the Civil and Administrative Tribunal Act 2013; and 2. The appellant is to pay the respondent's costs of and incidental to the appeal in an amount to be agreed or assessed. ********** I hereby certify that this is a true and accurate record of the reasons for decision of the New South Wales Civil and Administrative Tribunal. Principal Registrar 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 Amendments 13 June 2017 - Correction of typographical error in Order 2. To make order read '...and incidental to...' 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: 13 June 2017