Civil and Administrative Tribunal New South Wales Medium Neutral Citation: The Owners SP 89023 v AT Building Pty Ltd (No 2) [2019] NSWCATAP 215 Hearing dates: On the papers Date of orders: 27 August 2019 Decision date: 27 August 2019 Jurisdiction: Appeal Panel Before: L Pearson, Principal Member R Hamilton SC, Senior Member Decision: (1) A hearing is dispensed with pursuant to s50(2) Civil and Administrative Tribunal Act. (2) The Owners-SP 89023 must pay the respondents costs of and incidental to appeal AP 19/00156 on the ordinary basis as agreed or assessed. Catchwords: COSTS - home building- appeal from first instance costs order Legislation Cited: Civil and Administrative Tribunal Act 2013 Civil and Administrative Tribunal Rules 2014 Cases Cited: Latoudis v Casey (1990) 170 CLR 534 Oshlak v Richmond River Council [1998] HCA 11 Owners Corporation SP 79417 v Trajcevski (No.2) [2017] NSWCATAP 173 The Owners - Strata Plan 89023 v AT Building Pty Ltd [2019] NSWCATAP 171 Thomson v Chapman [2016] NSWCATAP 6 Texts Cited: Nil Category: Costs Parties: The Owners SP 89023 – Appellants AT Building Pty Ltd and Mowbray Road Pty Ltd as trustee for Mowbray Road Unit Trust - Respondents Representation: Counsel: D Priestley SC (Respondents) Solicitors: Sparke Helmore (Appellant) Mayweathers (Respondents) File Number(s): AP 19/00156 Publication restriction: Nil Decision under appeal Court or tribunal: Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Citation: [2018] NSWCATCD 33 Date of Decision: 13 December 2018 Before: P Boyce, Senior Member File Number(s): HB 15/61109 REASONS FOR DECISION 1. On 11 July 2019 we dismissed the appellant's appeal in this matter concerning the award of indemnity costs in the Tribunal in proceedings HB 15/61109 (The Owners - Strata Plan 89023 v AT Building Pty Ltd [2019] NSWCATAP 171) and made the following orders as to costs of the appeal: "3. If a party seeks an order for costs of the appeal, that party may file written submissions within 14 days of publication of these reasons seeking an order in relation to the costs of the appeal. 4. If a party files submissions in accordance with order 3, any other party may file submissions in response within a further 14 days. 5. Any submissions filed in accordance with orders 3 and 4 should address whether the question of costs may be determined on the papers and without a hearing pursuant to s50(2) of the Civil and Administrative Tribunal Act 2013." 1. The respondents to the appeal filed submissions on 22 July 2019. In summary they sought the costs of the appeal on the ordinary basis, and consented to the matter being dealt with on the papers without a further hearing. 2. The appellant provided submissions in reply, in which it consented to the issue of costs of the appeal being determined on the papers without a further hearing. 3. The Appeal Panel is satisfied that the issues for determination can be adequately determined in the absence of the parties by considering any written submissions or any other documents or material lodged with or provided to the Tribunal without a further hearing. The parties would be put to unnecessary expense if a hearing on costs were held. Accordingly, the order to dispense with a hearing pursuant to s50(2) of the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act) has been made. 4. Although the usual rule in the Tribunal is that each party pay their own costs unless there are 'special circumstances' (s60 NCAT Act), this is displaced in the case of proceedings in the Consumer and Commercial Division where the amount claimed or in dispute is more than $30,000, and in internal appeals in such proceedings (Rules 38 and 38A Civil and Administrative Tribunal Rules 2014 (NSW) (the Rules) 5. The respondents submitted that the amount claimed in both the substantive dispute and in the claim for costs exceeded $30,000, and that therefore s60 NCAT Act did not apply. The appellant does not dispute that rules 38(2)(b) and 38A apply. 6. We agree with this submission, and accordingly the Appeal Panel is not required to be satisfied that there are special circumstances warranting an award of costs. 7. The respondents submit that the usual rule that costs are awarded to the successful party, where there has been no disentitling conduct on their part, should apply. If the Appeal Panel considers that special circumstances are required, such circumstances exist as the appellant was wholly unsuccessful in the appeal and leave to appeal was refused; the appeal on a question of costs only was brought against a well-reasoned determination; no argument put forward on appeal was found to have any merit; and the appeal was brought despite the firmly established principle that costs orders are subject to a broad discretion and rarely to be interfered with. It would be perverse if the respondents could not recover the costs of successfully defending the costs order in their favour particularly having regard to the fact that the order turned on an offer made by the respondents in the proceedings for the express purpose of shortening the proceedings and avoiding unnecessary costs. The respondents do not make an application for indemnity costs of the appeal. 8. The appellant submits that the appeal was reasonable and of considerable merit, and disputes that the appeal was misconceived or lacking in substance. The application for costs should be dismissed, or in the alternative, each party should pay their own costs of the appeal. If a costs order is made, the appellant seeks that the costs of the appeal are to be as agreed or assessed. Consideration 1. The Tribunal has a wide discretion to make an order for costs, and rule 38 does not specify the factors the Tribunal must take into account in exercising the discretion. Where an application has been heard and determined on the merits, the appropriate starting point for the exercise of the discretion is the well-established position at common law; that is, that 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, this means that a party who is successful is entitled to an order for costs in its favour: Latoudis v Casey (1990) 170 CLR 534; Oshlak v Richmond River Council [1998] HCA 11. 2. The starting position is that the respondents are entitled to recover their costs of and incidental to the appeal proceedings in circumstances where there has been no submission that there has been disentitling conduct on their part to cause the discretion to award costs in their favour not to be exercised: Owners Corporation SP 79417 v Trajcevski (No.2) [2017] NSWCATAP 173. However, as discussed by the Appeal Panel in Thomson v Chapman [2016] NSWCATAP 6 at [71], where there is a general discretion for costs there is no absolute rule that, absent disentitling conduct, a successful party is to be compensated by the unsuccessful party, and nor is there any rule that a successful party might not be ordered to bear the costs of an unsuccessful party. In circumstances where there is a general discretion to award costs, the Tribunal in exercising its discretion is to have regard to the nature of the proceedings before it and all relevant factors arising in connection with those proceedings for the purpose of determining what order for costs, if any, should be made. 3. The appellants were not successful in establishing any of the five grounds of appeal against the costs order made in proceedings HB 15/61109, and the appeal was dismissed. No disentitling conduct has been asserted or established, and there is no other consideration which would displace the usual rule that the successful party (here the respondents) should have the costs of and incidental to the appeal on the ordinary basis as agreed or assessed. Orders 1. The orders of the Appeal Panel are: 1. A hearing is dispensed with pursuant to s50(2) Civil and Administrative Tribunal Act. 2. The Owners-SP 89023 must pay the respondents costs of and incidental to appeal AP 19/00156 on the ordinary basis as agreed or assessed. ********** 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: 27 August 2019