Akdogan v The Owners - Strata Plan No 55665 [2025] NSWCATCD 114;

1. The substantive dispute concerns a strata scheme in Brighton le Sands.
2. In March 2021 the OC resolved in a general meeting to replace the balustrades.
3. The then strata manager, Foreshew Strata Agency Pty Ltd ("Foreshew"), engaged Glaztech Pty Ltd ("Glaztech") to replace the balustrades at a cost of $72,238.00.
4. The work was completed in February 2022.
5. Glaztech was unlicensed, did not take out insurance pursuant to the Home Building Act 1989 (NSW) and was deregistered on or about 21 January 2022.
6. On 16 November 2022 Foreshew lodged proceedings in the Local Court against the OC, Zac Mourad, Kevin Green and Pinar Degirmenci ("the Foreshew claim"). In brief, Foreshew claims that it entered into an agreement with Zac Mourad, Green and Degirmenci whereby Foreshew loaned $73,013.00 to the OC. It has not been repaid.
7. Zac Mourad is the brother of Khaled Mourad who is the owner of lot 2 and one of the applicants in these proceedings. Zac Mourad and his partner, Ms Degirmenci, are defendants in the Foreshew claim and live in lot 2.
8. Mr Green, another defendant in the Foreshew claim, is the father of two of the applicants in the present proceedings, Jillian Dolby and Bronwyn Whale. Mr Green is a former owner and current tenant of lot 4. His interest in lot 4 was transferred to Ms Dolby and Ms Whale.
9. Some lot owners raised concerns about the safety and quality of the balustrades installed by Glaztech, and other concerns regarding the management of the strata scheme.
10. Upon application of some lot owners, the Tribunal appointed Strata Choice as compulsory strata manager on 16 October 2023 for a period of 2 years, pursuant to s 237 of the Strata Schemes Management Act 2015 (NSW) ("SSMA").
11. On or about 28 February 2024, the OC (by its compulsory strata manager) commenced proceedings against Foreshew ("the OC claim"), alleging breach of its duty of care in appointing Glaztech and claiming the cost of rectifying the defective balustrades, an amount up to $300,000.00.
12. The Foreshew claim was subsequently transferred to the District Court. On 23 July 2024 the District Court ordered that the Foreshew claim and the OC claim are to travel together and be heard together, with the evidence in one being relied on as evidence in the other (together referred to as "the District Court proceedings").
13. The District Court proceedings are still on foot.
14. In around July 2024 the OC obtained a loan of $500,000.00, apparently to fund litigation.
15. On 18 November 2024 the applicant lot owners filed these proceedings in the Tribunal against the OC. The second and third respondents were subsequently joined.
16. In Points of Claim lodged 7 February 2025 the applicants seek the following relief:

(1) An order revoking or terminating Strata Choice as compulsory strata manager;

(2) Alternatively, the appointment of ASM Strata Management in place of Strata Choice for the balance of the term of appointment;

(3) An order varying the levies raised on 20 May 2024 and 24 November 2024;

(4) Orders requiring the OC and/or Strata Choice to provide the following records and information to the applicants:

(a) A detailed accounts summary of amounts paid to all payees/ contractors and particulars regarding legal expenses incurred;

(b) Any advice as to risks and merit of the claim against Foreshew including in relation to anticipated legal costs and the anticipated recovery of compensation.

1. On 10 March 2025, at the request of the applicants, a Summons was issued addressed to the OC. Its focus is the OC's claim against Foreshew as part of the District Court proceedings. It seeks the production of the following documents:

(1) Any legal advice, correspondence, or memoranda received by the OC regarding the risks, merits, or prospects of success of the claim brought by the OC in the District Court against Foreshew;

(2) All fee notes, invoices, cost agreements, cost estimates, or cost disclosures received by the OC in connection with the claim against Foreshew;

(3) All expert reports, witness statements, or other evidentiary materials obtained by the OC or its legal representatives in relation to the claim against Foreshew, whether or not such materials have been served in the District Court proceedings;

(4) A copy of the loan agreement relating to the $500,000 loan facility obtained by the OC, together with a statement of the loan account to date;

(5) Any records or statements detailing the application or use of funds drawn on the loan facility, including but not limited to invoices, receipts, or other source documents evidencing payments made;

(6) Any quotes, estimates, or assessments obtained by the OC regarding the cost of rectifying the defects that are the subject of the claim against Foreshew;

(7) Any notices or correspondence received by the OC from Foreshew or its legal representatives under Part 4 (Proportionate Liability) of the Civil Liability Act 2002 (NSW) in relation to the claim against Foreshew;

(8) Any defence filed to the claim against Foreshew;

(9) Copies of all orders and directions made by the court in the proceedings for the claim against Foreshew, including any interlocutory orders or procedural directions;

(10) A copy of the 'Issues in Dispute' document relied upon and referred to in the judgement of NCAT Proceedings SC23/22595.

1. On 17 April 2025 the OC lodged a Miscellaneous Application with the Tribunal seeking the Summons to be set aside or amended. In compliance with directions, an amended Miscellaneous Application was filed on 3 June 2025.
2. Pursuant to the amended Miscellaneous Application, the OC seeks the following orders:

(1) That paragraphs 1, 2, 3, 6, 7, 8 and 9 be set aside.

(2) In the alternative:

(a) Order 1 above setting aside the Summons be made.

(b) The following paragraphs of the Summons be amended as follows:

(i) Paragraph 4 of the Summons be amended to "The OC to provide the Lot Owners a copy of the Loan Agreement with Lannock Strata Finance (Lannock) dated 5 July 2024 for the loan facility of $500,000";

(ii) Paragraph 5 of the Summons be amended to "The OC to provide to the Lot Owners Loan drawdown statements from Lannock from the commencement of the loan until the date the Summons was issued, and invoices submitted to Lannock based on which the loan drawdown was made"; and

(iii) Paragraph 10 of the Summons be amended to "The OC to provide to the Lot Owners a copy of the Schedule of Disputes document relating to NCAT Proceedings SC23/22595".

1. In determining the Miscellaneous Application, the Tribunal has had regard to the following:

(1) Applicants' submissions in support of the Summons lodged 2 May 2025;

(2) The OC's submissions in reply to the applicants' submissions in support lodged 14 May 2025;

(3) Amended Miscellaneous Application lodged by the OC on 3 June 2025 with submissions in support;

(4) Applicants' reply to the Amended Miscellaneous Application dated 18 June 2025;

(5) Applicants' folder including evidence and pleadings lodged 10 July 2025;

(6) Submissions by the second and third respondents in support of the Miscellaneous Application lodged 30 April 2025;

(7) Submissions by the second and third respondents in response to the applicants' submissions in support of the Summons, lodged 14 May 2025;

(8) Submissions by the second and third respondents in support of the amended Miscellaneous Application lodged 25 June 2025.

1. The OC's submissions may be summarised as follows:

(1) The documents sought in paragraphs 1 and 2 are the same documents which the applicants seek in paragraph 8 of their Points of Claim. The production of those documents should therefore be determined by the Tribunal once the respondents have examined the applicants' evidence and produced a defence;

(2) There is a history of conflict between the interests of the OC and the applicants. Both applications which make up the District Court proceedings are interconnected. The OC's position in the District Court proceedings will be jeopardised if it is required to produce to the applicants documents from the District Court proceedings;

(3) Pursuant to schedule 4, clause 5(7) of the Civil and Administrative Tribunal Act 2013 (NSW) ("NCAT Act"), the Tribunal ceases to have jurisdiction to hear and determine an issue if an issue arising under the application is the subject of a dispute in proceedings pending before a court. It is inappropriate for the Tribunal to determine the merits of the District Court proceedings, including costs, while those proceedings are on foot;

(4) The documents sought do not have probative value or legitimate forensic purpose in relation to the s 237 claim, nor the s 87 claim;

(5) The documents sought in paragraph 1 are privileged.

1. The Owners submit the request for those documents:

(1) Is an abuse of process because the documents have no relevance to the s 237 and s 87 claims; their production would be seriously prejudicial to the Owners because of the District Court proceedings; and amount to an exercise of discovery;

(2) Constitutes a fishing expedition;

(3) Is oppressive because it is too wide in scope, imposes too great a burden when the documents serve no legitimate forensic purpose;

(4) The respondent will incur unnecessary costs when the documents serve no legitimate forensic purpose;

(5) The documents requested in paragraphs 3 and 6 are privileged.

1. In important respects the second and third respondents rely on the submissions of the OC.
2. They also submit, in brief:

(1) The compulsory strata manager has provided lot owners with significant documentation about rectification alternatives;

(2) It would be inappropriate for the compulsory strata manager to release details of proposed remediation prior to the evaluation of tenders;

(3) The contested documents are confidential and legally privileged;

(4) The applicants are adversaries to the OC and are working with the conflicted parties Zac Mourad, Green and Degirmenci to thwart the ability of the OC to defend itself in the District Court proceedings;

(5) The provision of the documents would prejudice the OC in the District Court proceedings and/or the remediation or replacement of the balustrades.

1. The applicants' submissions in support of the Summons may be summarised as follows:

(1) The Points of Claim allege the compulsory strata manager imprudently commenced proceedings against Foreshew and the documents are relevant to that question ("the legal proceedings question");

(2) The documents sought in paragraphs 1 and 2 are essential to a proper analysis of the legal proceedings question;

(3) Cost agreements, estimates and disclosures cannot be subject to a claim for privilege, citing CSR Ltd v Eddy [2002] NSWCA 83 at [62];

(4) The District Court proceedings involve distinct claims. The Summons only seeks documents regarding the claim by the OC against Foreshew in the District Court, not the claim by Foreshew against the OC and Zac Mourad, Green and Degirmenci;

(5) None of the applicants in these proceedings are parties to the Local Court or District Court proceedings. Zac Mourad, Green and Degirmenci are not applicants in these proceedings;

(6) Even if the applicants in these proceedings are considered proxies for Zac Mourad, Green and Degirmenci, the claim against Foreshew is a separate and distinct claim from the claim by Foreshew that involves Zac Mourad, Green and Degirmenci. The applicants as lot owners share a common interest with the OC in the claim against Foreshew: their interests are not adversarial or divergent;

(7) The existence and content of the documents, or their non-existence, is of relevance to the prudence and propriety of the compulsory strata manager's decision to claim against Foreshew;

(8) The issues in these proceedings concern the conduct of the compulsory strata manager and whether its appointment should continue. Those issues are not raised in the District Court proceedings. The Tribunal is not required to determine the issues in the District Court proceedings, namely whether Foreshew was negligent or acted in breach of contract;

(9) The OC's concerns about the improper use of documents may be addressed by paragraph 41 of NCAT Procedural Direction 2 and s 64 of the NCAT Act.

(1) The District Court proceedings involving the OC and Foreshew are not separate and distinct because on 23 July 2024 orders were made in the District Court that the proceedings were to travel together and that evidence in one proceeding can be relied on as evidence in the other;

(2) Because of their familial relationships with parties to the District Court proceedings and their continued ties to the strata scheme (whether as lot owner or as tenant), Khaled Mourad and Mr Green have conflicting interests with the Owners;

(3) Such conflict is shown by Motion 3 submitted by Khaled Mourad, Mr Green, Ayten Akdogan and Ameen Ayoud at a general meeting they called on 13 September 2023. Motion 3 forms the foundation of the District Court proceedings;

(4) Because both District Court proceedings are interconnected, and because the lot owners have conflicting interests to the OC, the OC's position in the District Court proceedings will be jeopardised if it is required to produce documents from the District Court proceedings;

(5) By virtue of schedule 4, clause 5(7) of the NCAT Act, the Tribunal ceases to have jurisdiction to hear and determine issues related to the District Court proceedings and therefore it is inappropriate to produce documents from the District Court proceedings;

(6) The applicants have failed to explain how the documents from the District Court proceedings are relevant to the functioning of the strata scheme or the OC's failure to perform its duties. The Summons is a fishing expedition.

1. The Appeal Panel summarised the considerations relevant to the grant of leave to issue a summons in Lonsdale v University of Sydney [2015] NSWCATAP 277 as follows at [25] - [26]:

In White v Carlton Tow Bars Pty Ltd [2014] NSWCATAP 36, the Appeal Panel listed these considerations as relevant to the grant of leave to issue summonses:

(a) legitimate forensic purpose;

(b) identification of the respondent to an attendance summons 'with clarity and precision'; and similarly,

(c) identification of the documents in a documents summons with clarity and precision, rather than setting out a series of questions.

We agree with the respondent's submissions that to these should be added:

(d) the respondent must be both competent and compellable (though this will sometimes be a difficult matter for a registrar to address at that stage of consideration);

(e) a summons should not be over-broad and/or oppressive.

1. In Melhem v Commissioner of Police, NSW Police Force [2016] NSWCATAD 279 the Tribunal said at [12]:

A summons may be set aside for various reasons which sometimes overlap. Broadly, they fall into the categories of abuse of process, oppression of the addressee, insufficient particularisation, lack of apparent relevance and using a summons as a fishing expedition. If a document is privileged from production or it will constitute an offence to produce the document, those matters will also be relevant when deciding whether to set aside a summons.

1. The principles to be applied when considering an application to set aside a summons were summarised by the Tribunal in CPJ v The University of Newcastle [2017] NSWCATAD 350 at [8] to [12]:

The Tribunal's guiding principle when exercising any power under the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act), is to "facilitate the just, quick and cheap resolution of the 'real issues' in proceedings": s 36(1) ...

A registrar may, on the application of a party to proceedings or at the direction of the Tribunal, issue a summons: NCAT Act, s 48. NCAT Procedural Direction 2 gives as an example of an objection that can be made to a summons, that the "evidence, documents or other things identified in the summons are not relevant to any issue in dispute in the proceedings". The Tribunal may draw on common law principles when determining whether to set aside a summons. At common law, a summons must only be issued for a legitimate forensic purpose. The onus is on the party attempting to procure the material to demonstrate a legitimate forensic purpose by reference to the issues as disclosed in the pleadings: Becwell Legal Services Pty Ltd v McMaster [2011] FCA 1501 at [27].

It is an abuse of process to issue a summons in relation to documents which have no "apparent relevance" to the issues in dispute: Portal Software v Bodsworth [2005] NSWSC 1115 Brereton J at [22] and [23]; Becwell Legal Services Pty Ltd v McMaster [2011] FCA 1501 at [26]. It is also impermissible for a party to use a summons for "fishing". The author Bernard Cairns describes "fishing" as "where a party attempts by way of a subpoena to find out facts, matters and circumstances which might enable the party to advance a case of which there is no present knowledge": Bernard Cairns, Australian Civil Procedure, Thomson Reuters (10th ed 2014) at 585.

The question is not whether the documents would be admissible in evidence or will "definitely advance the case of the parties" issuing the summons: Portal Software v Bodsworth [2005] NSWSC 1115 Brereton J at [25]. The test is whether the documents sought under the summons have apparent, as distinct from actual, relevance to the case: National Employers' Mutual General Assn Ltd v Waind [1978] 1 NSWLR 372; Casley-Smith v District Council of Stirling (1989) 51 SASR 447.

In a recent Supreme Court case, Brereton J summarised the principle as being "... that there is a reasonable basis for supposing that the material called for will likely add, in the end, in some way or another, to the relevant evidence in the case. This reflects the notions that the documents relate to, throw light on or are sufficiently relevant to the dispute; that they "appear relevant in the sense they relate to the subject matter of the proceedings"; or that they could possibly throw light on the issues in the case": Sharpe v Grobbel [2017] NSWSC 1065 at [35] (footnotes deleted.)

1. Further, in Secretary of the Department of Planning, Industry and Environment v Blacktown City Council [2021] NSWCA 145 per Bell P at [65] and [70]:

It is sufficient, in my view, to justify a subpoena as having been issued for a legitimate forensic purpose if the documents sought are "apparently relevant" or, to use the words of Nicholas J in ICAP at first instance, it can be seen that the documents sought to be produced by way of subpoena will materially assist on an identified issue or there is a reasonable basis beyond speculation that it is likely the documents subpoenaed will so assist.

... if it can be demonstrated that the party issuing the subpoena has done so for some improper, illegitimate or ulterior purpose foreign to the litigation, the Court in the exercise of its discretion may set aside the subpoena as an abuse of process or refuse access to the subpoenaed documents in spite of their apparent relevance.

1. The issues in the substantive proceedings are particularised in some detail in the Points of Claim.
2. In brief, those issues are the revocation, termination and/or appointment of a compulsory strata manager; whether levies that have been raised should be varied; and whether the OC and/or the strata manager should provide documents relating to legal expenses and advice about the risks and merits of the claim against Foreshew.
3. The principles regarding whether or not a compulsory strata manager should be appointed are well established.
4. The Appeal Panel has said that the circumstances in which the management structure may not be functioning or functioning satisfactorily include where management raises levies and takes or defends legal action on behalf of the owners corporation in circumstances where such action is unnecessary or not in the interests of the owners corporation or the lot owners as a whole: Bischoff v Sahade [2015] NSWCATAP 135 ('Bischoff') at [22].
5. I am satisfied that the documents sought under the Summons have apparent relevance to the issues in the substantive proceedings because the documents could possibly throw light on the question of the merits of the OC's action against Foreshew and the risks and benefits of that action, relative to the alternative of the OC rectifying the defects and bearing the cost itself.
6. The documents also have apparent relevance to the issue of whether the levies raised by the compulsory strata manager are excessive and unreasonable, due to, inter alia, legal costs.
7. I am therefore satisfied that the documents sought in the Summons have a legitimate forensic purpose. For that reason, I am not persuaded the Summons was issued for an ulterior purpose such as to 'thwart' to OC's defence of the Foreshew claim.
8. Nor am I persuaded that the Summons is over-broad and/or oppressive. The applicants have identified with sufficient particularity the documents they seek.

Are the documents requested in paragraphs 1, 3 and 6 privileged?

1. The onus of establishing that privilege applies such that disclosure may be resisted is on the person asserting the privilege: Kenquist Nominees Pty Ltd v Campbell (No 5) [2018] FCA 853 at [18] per Thawley J.
2. Both parties referred to The Owners - Strata Plan No 74602 v Eastmark Holdings Pty Ltd [2013] NSWCA 221 (Eastmark) and The Owners Strata Plan No. 2000 v Bylinska [2019] NSWCATAP 116 (Bylinska).
3. Notwithstanding s 182 of the SSMA, an owners corporation is not required to make available to a party with which the owners corporation is in dispute documents relating to the dispute which are subject to legal professional privilege.
4. None of the applicants are parties to the District Court proceedings.
5. Even if I was to accept that some of the applicants are effectively proxies for Zac Mourad, Green and Degirmenci, a conflict of interest with the OC might exist only in relation to Foreshew's claim, because Foreshew is seeking relief against Zac Mourad, Green and Degirmenci as well as the OC.
6. Similarly, the Qualified Request submitted by Akdogan, Ayoud, Khaled Mourad and Green, calling a general meeting together with the controversial Motion 3, only relates to Foreshew's claim against the OC for the loan repayment.
7. If the Summons sought documents relating to Foreshew's claim against the OC, those documents may be privileged because of the parties' divergent interests.
8. However, the Summons only seeks documents relating to the OC's claim against Foreshew.
9. If, as the second and third respondents contend, the applicants oppose the OC's litigation against Foreshew and accept the balustrades in their current state (without rectification), I do not accept that this would mean the parties are in dispute, in the relevant sense of Eastmark and Bylinska.
10. Neither the applicants, nor Zac Mourad, Green and Degirmenci, are defendants in the OC's claim against Foreshew. The OC only seeks damages from Foreshew. I am not persuaded that the interests of the OC and the applicants are divergent in that dispute.
11. The OC points out that the evidence in one claim in the District Court proceedings is to be relied on as evidence in the other. However, it is not apparent why the OC's position in the District Court proceedings will be jeopardised if the documents are produced. They will not be produced to Foreshew. They do not relate to Foreshew's claim against the OC. Documents obtained under the Summons may only be used for purposes directly connected with the OC's claim, and not for a collateral or ulterior purpose such as Foreshew's claim.
12. The OC has failed to discharge the onus of establishing that privilege applies to the documents sought in the Summons.

Does the Summons circumvent the orders sought in the Points of Claim?

1. This objection relates to paragraphs 1 and 2 of the Summons.
2. As the applicants highlight, the OC has not identified any relevant legal authority for this objection.
3. A half day hearing was committed to the Summons objections, and both parties provided detailed written submissions. Both parties have had a reasonable opportunity to be heard. I do not consider that the Summons has 'sidestepped' the Tribunal's proper consideration of whether the documents should be produced.
4. Theoretically, it would be open to the applicants to withdraw the component of their substantive application seeking an order for those documents. On the logic of the OC's submission, this objection would then fall away.
5. I am not persuaded this is a valid ground of objection.

1. Clause 5(7) of Schedule 4 of the NCAT Act provides:

Effect of pending court proceedings on Tribunal If, at the time when an application is made to the Tribunal for the exercise of a Division function, an issue arising under the application was the subject of a dispute in proceedings pending before a court, the Tribunal, on becoming aware of those proceedings, ceases to have jurisdiction to hear or determine the issue.

1. The pleadings relevant to the District Court proceedings are included in the applicants' evidence bundle.
2. The issues in the District Court proceedings concern, in brief:

(1) Whether Foreshew has a claim against the OC for unjust enrichment due to money loaned to the OC and not repaid; and

(2) Whether Foreshew breached its duty to the OC to exercise reasonable care and skill in the performance of its duties as a strata manager by recommending Glaztech carry out remedial works when Glaztech did not have the relevant contractor license, did not obtain the required insurance and did not enter into a written contract as prescribed by the Home Building Act 1989 (NSW).

1. Clearly, the Tribunal would have no jurisdiction to hear and determine the issue of whether Foreshew was negligent.
2. However, that issue is not raised in the Tribunal proceedings, as per the Points of Claim outlined in [16] above.
3. In determining the substantive application before it, the Tribunal is not required to hear or determine the issues in the District Court proceedings, including whether Foreshew was negligent.
4. The issue of whether the OC's claim against Foreshew was necessary or in the interests of the OC or the lot owners as a whole (Bischoff) does not depend on the ultimate outcome of those proceedings, or a determination of its merits. The cost and duration of the proceedings relative to the cost and duration of remediation is likely to be a critical factor, regardless of whether the OC or Foreshew is the successful party in the District Court.

1. The applicants and the OC have made written submissions regarding costs, including the existence of special circumstances.
2. I am not persuaded that the circumstances of this interlocutory application are out of the ordinary in the sense of s 60(2) of the NCAT Act.
3. While the OC was unsuccessful, it cannot be said that the objections to the Summons were without merit, misconceived or lacking in substance.
4. Neither party addressed whether they consented to a hearing being dispensed with regarding costs. The orders will contain provision for written submissions, in the event a party objects to the Tribunal's determination of costs based on the written submissions provided to date.

(1) The Miscellaneous Application seeking the set aside and/or amendment of the Summons issued on 10 March 2025 is dismissed.

(2) The Summons is returnable on 26 August 2025 at 9.15 am in Chambers. Attendance is not required.

(3) A hearing regarding costs is dispensed with under s 50(2) of the Civil and Administrative Tribunal Act 2013 (NSW).

(4) The costs of this interlocutory application are to be costs in the cause of the substantive proceedings.

(5) If either party makes an application to vary order (3) and (4) above in the manner and within the time specified in order 5(a) below, order (3) and (4) above cease to have effect and the following directions apply:

(a) The party seeking to vary the orders is to lodge and serve submissions limited to three pages by 26 August 2025.

(b) The other party is to lodge and serve any submissions limited to three pages by 9 September 2025.

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.