Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Komadina trading as We Paint Pools v Kelleher [2018] NSWCATAP 56 Hearing dates: On the papers Date of orders: 05 March 2018 Decision date: 05 March 2018 Jurisdiction: Appeal Panel Before: L Pearson, Principal Member J Kearney, 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. (2) The application for costs is dismissed. (3) Each party is to pay its own costs. Catchwords: COSTS: Whether special circumstances Legislation Cited: Civil and Administrative Tribunal Act 2013 Civil and Administrative Tribunal Rules 2014 Cases Cited: Sam Komadina t/as We Paint Pools v Kelleher [2018] NSWCATAP 3 Megerditchian v Kurmond Homes Pty Ltd [2014] NSWCATAP 120 Category: Costs Parties: Sam Komadina t/as We Paint Pools (Appellant) Deborah Kelleher (Respondent) Representation: Counsel: J Nathan (Appellant) Solicitors: Contracts Specialist Solicitors and Attorneys (Appellant) McNally Jones Staff (Respondent) File Number(s): AP 17/37989 Publication restriction: No Decision under appeal Court or tribunal: NSW Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Date of Decision: 2 August 2017 Before: P French, General Member File Number(s): HB 17/15866 REASONS FOR DECISION 1. This is an application for costs made by Deborah Kelleher (the homeowner) against Sam Komadina t/as We Paint Pools (the contractor), arising from an internal appeal under s 80(1) of the Civil and Administrative Tribunal Act 2013 (the NCAT Act) in respect of proceedings HB 17/15866 in the Consumer and Commercial Division, in which the contractor was ordered to pay the homeowner $21,890.00 compensation for the cost of rectifying incomplete and defective home building works, being the repair of an in-ground pool at premises in Blacktown NSW. 2. In the substantive proceedings, the contractor's appeal was wholly unsuccessful on all grounds. On 3 January 2018 we made the following orders: (1) Leave to appeal refused. (2) Appeal dismissed. (3) The stay of the operation of order 2 made on 2 August 2017 in HB 17/15866 is lifted. (4) If either party seeks costs of the appeal, leave is granted to file and serve a short written submission on that issue within 14 days of the date of this decision. (5) Leave is granted for the other party to file and serve a short written submission in reply within a further 14 days. (6) Submissions should address the question of whether the Tribunal should dispense with a hearing on the issue of costs, pursuant to s 50 of the Civil and Administrative Tribunal Act 2013. 1. The background to the substantive application and our reasons for the decision are set out in Sam Komadina t/as We Paint Pools v Kelleher [2018] NSWCATAP 3. Costs application and submissions 1. On 22 January 2018 the homeowner emailed the Tribunal stating "I would like to seek my costs for the appeal AP 17/37989 which totalled $5,830.00". The homeowner stated: I believe I did everything right and the evidence was more than clear so feel I am bound to seek costs. Attached please find the final documentation re Costs. 1. The homeowner copied the email to the solicitors who had acted on the appeal. 2. On 30 January 2018 the Tribunal wrote to the homeowner advising her that in accordance with the directions made she was required to provide a short written submission as to her claim for costs, noting in particular the requirement in s 60(2) of the NCAT Act that the Tribunal may only award costs in the circumstances of this appeal if satisfied there are special circumstances warranting an award of costs; that the submissions should include submissions as to whether the Appeal Panel should dispense with a hearing on costs, and determine the application on the papers; and that she should include in her submissions any application for leave under s 41 of the NCAT Act to extend the time to make her application for costs. 3. On 1 February 2018 the homeowner provided her submissions, including a request for leave to extend the time to make the application for costs. The homeowner submitted that she had not been aware of an email advising her that the decision on the appeal would be published on 3 January 2018. In support of her contention that there are special circumstances warranting an award of costs, the homeowner relevantly submits: 1. The damage done by the contractor was clear and evident in the first hearing; 2. The original quote was $5,500 which escalated to $7,500 and eventually cost $30,000 after engaging another contractor; 3. The contractor was found to be an unlicensed house painter while repairing the pool and was not licensed for pool repair work; 4. The address for service of documents is still the contractor's business address despite his evidence that he had not lived there for many years; 5. The contractor is not known at either his electoral roll address, or the PO Box address on his website; 6. The appeal disadvantaged her financial position above the amount already paid out to repair the damage caused by the contractor. 1. The homeowner is seeking payment of $5,830.00, which is the amount specified in the costs agreement with the solicitor who appeared on her behalf at the appeal hearing. In her submission the homeowner refers to possible additional costs and interest should she take enforcement action, however any such amounts are not quantified. 2. The homeowner advised the Tribunal on 2 February 2018 that she had emailed a copy of her submissions to the contractor's barrister. 3. No submissions in reply were received within the period specified in Order 5. On 26 February 2018 the contractor's solicitor provided written submissions on behalf of the contractor. Those submissions repeated the claim that the contractor had no knowledge of the first instance hearing, and the contention that the Member erred in finding that the contract was with the homeowner. Relevant to the issue of costs, the contractor submits that there is no evidence that the proceedings were conducted in a way that unnecessarily disadvantaged the homeowner, or that the contractor was responsible for prolonging the proceedings, and that the contractor's claim was arguable. Issues 1. The issues to be determined are: 1. Whether an order should be made dispensing with a hearing in accordance with s 50(1)(c) of the NCAT Act; and 2. Whether an order for costs should be made in favour of the homeowner. Consideration Whether an order should be made dispensing with a hearing 1. The parties were given an opportunity to make submissions in relation to whether the Tribunal should dispense with a hearing on any costs application. The homeowner made no submission, and the contractor submitted that costs should be considered on the papers. 2. We are satisfied that the issue of costs can be adequately determined in the absence of the parties by considering the written submissions, and that a hearing would only delay and add to the costs of the proceedings. 3. Accordingly an order under s 50(1)(c) of the NCAT Act has been made. Whether an order for costs should be made 1. The power to order costs is governed by s 60 of the NCAT Act: 60 Costs (1) Each party to proceedings in the Tribunal is to pay the party's own costs. (2) The Tribunal may award costs in relation to proceedings before it only if it is satisfied that there are special circumstances warranting an award of costs. (3) In determining whether there are special circumstances warranting an award of costs, the Tribunal may have regard to the following: (a) whether a party has conducted the proceedings in a way that unnecessarily disadvantaged another party to the proceedings, (b) whether a party has been responsible for prolonging unreasonably the time taken to complete the proceedings, (c) the relative strengths of the claims made by each of the parties, including whether a party has made a claim that has no tenable basis in fact or law, (d) the nature and complexity of the proceedings, (e) whether the proceedings were frivolous or vexatious or otherwise misconceived or lacking in substance, (f) whether a party has refused or failed to comply with the duty imposed by section 36 (3), (g) any other matter that the Tribunal considers relevant. (4) If costs are to be awarded by the Tribunal, the Tribunal may: (a) determine by whom and to what extent costs are to be paid, and (b) order costs to be assessed on the basis set out in the legal costs legislation (as defined in section 3A of the Legal Profession Uniform Law Application Act 2014) or on any other basis. (5) In this section: costs includes: (a) the costs of, or incidental to, proceedings in the Tribunal, and (b) the costs of, or incidental to, the proceedings giving rise to the application or appeal, as well as the costs of or incidental to the application or appeal. 1. Clause 38 of the Civil and Administrative Tribunal Rules 2014 (the Rules) modifies the application of s 60 in proceedings in the Consumer and Commercial Division, and relevantly provides in cl 38(2) that in proceedings where the amount claimed or in dispute is more than $30,000, the Tribunal may award costs in the absence of special circumstances. The homeowner's claim was for reimbursement of a total amount of $29,390.00, being the cost for another contractor to repair the pool and the ground around the pool, and the amount paid to Mr Komadina. Clause 38(2) of the Rules does not apply, and the applicable costs provision for the proceedings in the Consumer and Commercial Division is s 60 of the NCAT Act. The first instance costs provisions did not differ from those in s 60, and accordingly cl 38A of the Rules does not apply. 2. The issue is therefore whether we are satisfied that there are special circumstances warranting an award of costs. Otherwise, s 60(1) provides that each party is to pay its own costs. The term "special circumstances" is not defined in the Act. It has been interpreted to mean circumstances that are out of the ordinary but not necessarily extraordinary or exceptional. The discretion to award costs must be exercised judicially having regard to the underlying principle that parties to proceedings in the Tribunal are ordinarily to bear their own costs: Megerditchian v Kurmond Homes Pty Ltd [2014] NSWCATAP 120 at [11]. 3. The parties complied with the procedural directions made at the appeal call over on 12 September 2017, and it cannot be said that the appellant contractor conducted the appeal proceedings in a way that unnecessarily disadvantaged the homeowner. The contractor was unsuccessful both on the procedural fairness contention identified in the Notice of Appeal and on the additional ground for which he was given leave to amend during the appeal hearing. However, it could not be said that the appeal had no tenable basis in fact or law, or that the appeal proceedings were frivolous or vexatious or otherwise misconceived or lacking in substance. The submissions of the homeowner rely to a significant extent on her grievance with the work undertaken by the contractor, which was the subject of the first instance proceedings and in respect of which she was awarded compensation. Her complaint that the contractor does not respond to contacts at the address formally listed as his registered business address was a central issue, determined in her favour, in the appeal. However, while she was successful in defending the appeal and the order made in her favour at first instance, that is not sufficient to constitute special circumstances. 4. We are not satisfied that even if we were to extend the time for the homeowner to make her application for costs of the appeal, that the factors on which she relies, separately or in combination, constitute special circumstances warranting an award of costs. It follows we are unable to exercise the power to award costs in the appeal. Orders 1. The orders of the Appeal Panel are: 1. A hearing on costs is dispensed with pursuant to s 50(1)(c) of the Civil and Administrative Tribunal Act 2013. 2. The application for costs is dismissed. 3. Each party is to pay its own costs. ​ ********** ​ 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: 05 March 2018