Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Nutek Constructions Pty Ltd v Slotwinski (No 3) [2018] NSWCATAP 226 Hearing dates: 4 September 2018 Date of orders: 20 September 2018 Decision date: 20 September 2018 Jurisdiction: Appeal Panel Before: R C Titterton, Principal Member Decision: 1. The application for a stay is refused. 2. The interim stay granted on 22 August 2018 and continued on 4 September 2018 until further order is lifted. Catchwords: INTERLOCUTORY ORDERS – application for a stay – no question of principle Legislation Cited: Civil and Administrative Tribunal Act 2013 (NSW) Cases Cited: Alexander v Cambridge Credit Corporation Ltd (1985) 2 NSWLR 685 Bentran Pty Ltd v Sabbarton [2014] NSWCATAP 37 Kalafair Pty Limited v Digitec (Australia) Pty Limited (2002) 55 NSWLR 737 Mushroom Composters Pty Ltd v IS & DE Robertson Pty Ltd [2014] NSWCA 231 New South Wales Bar Association v Stevens [2003] NSWCA 95 Penrith Whitewater Stadium Ltd v Lesvos Pty Ltd [2007] NSWCA 103 Vaughan v Dawson [2008] NSWCA 169 Williams v Spautz (1992) 174 CLR 509 Category: Procedural and other rulings Parties: Nutek Constructions Pty Ltd (Appellant) Piotr Slotwinski and Julia Slotwinski (Respondents) Representation: Counsel: I Archibold (Appellant) D O'Connor (Respondents) Solicitors: Harrington Lawyers (Appellant) Lou Baker & Associates (Respondents) File Number(s): AP 18/36620 Decision under appeal Court or tribunal: Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Date of Decision: 26 July 2018 Before: G Meadows, Senior Member File Number(s): HB 16/25001 and HB 17/06469 REASONS FOR DECISION Summary 1. For convenience, in these reasons, I will refer to the appellant as the Builder, and the respondents as the Homeowners. 2. On 26 July 2018, the Tribunal published its costs decisions in matters HB 16/25001 and HB 17/06469 (the Costs Decision). (The Tribunal had previously published its substantive reasons on 2 May 2018 (the Substantive Decision). On 21 August 2018, the Builder filed an appeal in respect of the Costs Decision and sought a stay of order (2) in proceedings HB 16/25001, and order (3) in proceedings HB 17/06469. 3. For the following reasons, each application for a stay is dismissed. Appellant's submissions 1. The appellant relies on submissions filed 27 August 2018 and 7 September 2018. In summary, it makes the following submissions. 2. First, it submits that the Costs Decision was made prematurely, in that it is inappropriate that an order for costs be made in circumstances where the decision is on appeal and the outcome of the appeal is likely to change the outcome of the decision of the Tribunal below and therefore the costs that would follow. 3. Secondly, it is likely that the decision of the Appeal Panel will significantly affect the costs orders made by the Tribunal. 4. Thirdly, the Homeowners are located abroad, and it would be difficult for the Builder to recover any monies paid should the decision on costs be reversed. 5. Fourthly, the Homeowner Ms Slotwinski has not complied the order to pay the Builder $36,500 and has not paid to the appellant the ordered amount. Accordingly, there is a significant risk that should the costs be paid to the Homeowners, the amounts would not be recoverable in the event of a decision being made in any of the appeal proceedings that reverses the decision dated 26 July 2018, In that regard, the Builder submits that Ms Slotwinski has pending bankruptcy proceedings before the Federal Court of Australia. Respondent's submission 1. The Homeowners submit that the granting of a stay would be an abuse of process. The Homeowners submit that, on the one hand, the Builder would be allowed to enforce that part of the Substantive Decision in its favour (namely the award of $36,500) but be able to stay the costs orders made against it. 2. The Homeowners submit: * it is an abuse of process to use court proceedings for the purpose of obtaining some collateral advantage, and a party using proceedings to obtain a collateral advantage will be liable to be held guilty of abusing the process of the court and therefore disqualified from invoking the powers of the Court see; Williams v Spautz (1992) 174 CLR 509; * the current application is an abuse of process because the appellant is enforcing part of the Substantive Decision favorable to it by serving a bankruptcy notice, but seeking that this Tribunal stay the Costs Decision which would be otherwise available to it to set off the amounts claimed in the bankruptcy notice; * a party cannot seek to stay part of the Substantive Decision unfavorable to it and yet seek to enforce part of the Decision favorable to it; * by seeking that the costs orders be stayed the appellant is seeking a collateral advantage in other proceedings, namely the application to set aside the bankruptcy notice now filed in the Federal Court of Australia (NSD1475/2018). 1. In conclusion, the Homeowners submit that it would be unjust and an abuse of process to stay the costs orders in circumstances where the Builder is seeking to bankrupt a litigant to the proceedings based on a judgment emanating from the same proceedings in another Court. Principles 1. As the President of the Tribunal noted in Bentran Pty Ltd v Sabbarton [2014] NSWCATAP 37, under s 43 of the Civil and Administrative Tribunal Act 2013 (NSW) (the Act), the lodgment of an internal appeal, such as the appeal in the present case, does not affect the operation of the decision appealed. Nonetheless, under s 43(3) the Tribunal may stay the operation of a decision pending the determination of the appeal. 2. In Bentran, the relevant appeals governing stays are set out at [8] and [9] as setting out the relevant principles. In summary, those principles are: 1. generally a successful party is entitled to the benefit of the decision or orders that the party has obtained at first instance, but a stay may be granted where the appellant has demonstrated an appropriate case to warrant the exercise of discretion in its favour: s 43(2) and (3) of the Act; Kalafair Pty Limited v Digitec (Australia) Pty Limited (2002) 55 NSWLR 737 at [28], Mushroom Composters Pty Ltd v IS & DE Robertson Pty Ltd [2014] NSWCA 231 at [7]; 2. the onus is on an applicant for a stay to make out a case that it is appropriate for the court to make such an order: Alexander v Cambridge Credit Corporation Ltd (1985) 2 NSWLR 685 at 694, Vaughan v Dawson [2008] NSWCA 169 at 16; 3. the mere lodgment of the notice of appeal is insufficient, of itself, to demonstrate that it is an appropriate case to warrant the granting of a stay: Cambridge Credit Corporation Ltd at 694, Mushroom Composters at [7]; 4. an order staying the operation of a decision or orders will generally be appropriate where such an order is reasonably necessary to secure the effectiveness of the appeal; 5. the Tribunal may also take into account the strength or otherwise of the case of the party seeking the stay. 6. the Tribunal's power to grant a stay includes a power to make such an order subject to such conditions as the Tribunal specifies; 7. in exercising the discretion, the Tribunal will weigh the balance of convenience and the competing rights of the parties and may impose appropriate conditions so as to achieve a result that is fair to all parties; 8. finally, the overriding principle in an application for a stay is to ask what the interests of justice require: New South Wales Bar Association v Stevens [2003] NSWCA 95 at [83] and Penrith Whitewater Stadium Ltd v Lesvos Pty Ltd [2007] NSWCA 103 at [18]. Consideration 1. I need to set the present application in the overall history of the proceedings. 2. On 2 May 2018, the Tribunal published the Substantive Decision. The effect of the Substantive Decision was that: 1. the respondents were to pay the Builder $36,500, the Builder having claimed $200,000, in proceedings HB 16/25001; 2. the Builder failed entirely in proceedings HB 17/06469, having claimed $77,000. 1. Both parties filed appeals against the Substantive Decision. 2. The Homeowners sought a stay of the Substantive Decision that they pay the Builder $36,500 pending the determination of the appeal. That application was dismissed on 22 May 2018. 3. The Tribunal subsequently issued its decision on costs on 26 July 2018. In matter HB 16/25001, the Tribunal made the following orders: 1. the Homeowners are to pay the Builder's costs thrown away of and incidental to the Homeowners' application to transfer proceedings HB 16/25001 and HB 17/06469 to the Supreme Court. 2. otherwise the Builder is to pay the Homeowner's costs as agreed or assessed on the ordinary basis, such costs to be reduced by the proportion of 15%. 1. In proceedings HB 17/06469, the Tribunal made the following orders numbered as follows: (3) the Builder is to pay the Homeowners' costs as agreed or assessed on an indemnity basis; (4) Order 3 does not apply with regard to Sydney's Elite Concrete Pumping Services Pty Ltd. 1. This is the decision the subject of the present application for a stay. As noted, the Builder seeks a stay of order (2) in proceedings HB 16/25001, and order (3) in proceedings HB 17/06469. 2. I turn now to the Bentran matters. I note that generally a successful party is entitled to the benefit of the decision or orders that they obtained at first instance, but a stay may be granted where the appellant has demonstrated an appropriate case to warrant the exercise of discretion in its favour. The onus is on an applicant, here the Builder, for a stay to make out a case that it is appropriate for the court or Tribunal to make such an order. Effectiveness of the appeal 1. I am not persuaded that an order staying the operation of a decision or orders will generally be appropriate where such an order is reasonably necessary to secure the effectiveness of the appeal. Generally, a successful party is entitled to the benefit of the decision or orders that the party has obtained at first instance: Bentran at [9](1). This is a simple money order, where the Homeowners are entitled are entitled to the fruits of their victory, subject to the Builder demonstrating an appropriate case to warrant the exercise of discretion in its favour. In my view, this discretionary factor does not warrant the granting of a stay. Strength of the case 1. Neither party addresses this factor. I note however that the Builder asserts that: * the outcome of the appeal in the Substantive Decision "is likely to change the outcome of the decision of the Tribunal below and therefore the costs that would follow"; and * The decision of the Appeal Panel will "significantly affect the costs order made by the Tribunal" 1. I see no particular substance in these submissions. In the absence of any persuasive reasoning about the strength of the appeal, the outcome is simply speculative. To my mind this is, at best, a neutral factor in determining whether or not to grant a stay. At worse, this discretionary factor does not warrant the granting of a stay. Balance of convenience 1. In exercising its discretion, the Tribunal will weigh the balance of convenience and the competing rights of the parties and may impose appropriate conditions so as to achieve a result that is fair to all parties. The Builder asserts, relevantly, that the Homeowners are abroad and it would be difficult to recover monies. The Builder further asserts that any costs paid would be difficult to recover. While there is no evidence to support this assertion, it is not disputed in the Homeowners' submissions in response. This factor therefore favours somewhat the grant of a stay. However, the evidence about Ms Slotwinski's impecuniosity somewhat minimizes this discretionary factor. There is no material before me about Mr Slotwinski at all. On balance, this factor barely favours the grant of a stay. The interests of justice 1. The Homeowners made persuasive submissions referring to an abuse of process were a stay to be granted. I would not characterize the present situation like that myself, but I do consider that there is substance in a submission that the interests of justice require a stay not being granted. It does seem unfair, or inequitable, to allow the Builder to "cherry pick" those parts of the ultimate outcome that suits it, and to require the Homeowners to comply with an order that they pay compensation of some $36,500, in circumstances where it refuses to pay costs as ordered. 2. And I reject the argument that the Costs Decision was premature ending the outcome of the Substantive Decision. To my mind, it was entirely appropriate for the Tribunal to proceed in the way it did. 3. Finally, there should be parity with the result of the Builder's application for a stay in the appeal in relation to the Substantive Decision. 4. In my view, the interests of justice do not favour the granting of a stay. Conclusion 1. Having weighed all these matters, I consider that a stay should not be granted. Order 1. The application for a stay is refused. 2. The interim stay granted on 22 August 2018 and continued on 4 September 2018 until further order is lifted. ********** 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: 20 September 2018