Anderson v Cameron

REASONS FOR DECISION

1. The respondent landlord, Mr and Mrs Cameron, seek an order that the appellant tenant, Mr Anderson, pay their costs of the appeal, which was dismissed by the Tribunal, constituted by Principal Member Redfern. The appellant's appeal was dismissed, on 25 February 2016, under subsection 55(1)(a) of the Civil and Administrative Tribunal Act 2013 as the appellant had advised, on 9 February 2016, that he did not wish to proceed with his appeal. Principal Member Redfern dismissed the appellant's appeal subject to respondent's application for costs.
2. Subsequent to making the orders on 25 February 2016, Principal Member Redfern was no longer able to hear and determine the respondents' application for costs as she had resigned. In light of this, on 13 April 2016, the Principal Registrar wrote to the parties to inform them of Principal Member Redfern's unavailability to hear and determine the respondent's cost application and that the President proposed to reconstitute the Appeal Panel by appointing me to replace Principal Member Redfern pursuant to subsection 52(2)(a) of the Civil and Administrative Tribunal Act 2013. The parties were also invited to make any submissions on the proposed reconstitution by 26 April 2016.
3. On 15 April 2016, the respondents' solicitor wrote to the Registrar stating the respondents had no objection to the Tribunal following its own internal procedures. The solicitor also advised that on 25 February 2016, the Federal Circuit Court of Australia had made a sequestration order against the estate of the appellant under the Bankruptcy Act 1966. A copy of the order was enclosed and I note the order was stayed for a period of 21 days. The respondent's solicitor advised that the applicant for the sequestration order was a former landlord of the appellant and if an award of costs were to be made by the Tribunal "it would simply be lodged as a proof of debt with the Trustee in Bankruptcy."
4. The appellant has not responded to the Registrar's letter concerning the reconstitution of the Tribunal.
5. I note the stay of proceedings provisions in section 60 of the Bankruptcy Act 1966. In the absence of the parties informing the Tribunal otherwise, I have assumed the Federal Circuit Court has not made an order staying these proceedings. Accordingly, I have determined the respondents' application for costs on the papers that are before the Tribunal.

The Tribunal's power to make an order for costs

1. The Tribunal's power to make an award of costs is contained in section 60 of the Civil and Administrative Tribunal Act 2013. That section provides as follows: 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.
2. Accordingly, the issue for determination in this application of the respondents is whether they have established that there are special circumstances that warrant an award of costs in their favour in this appeal. For the reasons set out below, I have found that they have failed to do so.

Background

1. On 21 January 2016, the appellant filed a Notice of Appeal seeking to appeal a decision of the Tribunal, in the Consumer and Commercial Division, terminating the residential tenancy agreement (tenancy agreement) he had entered into with the respondents on 22 May 2015. The Tribunal's decision was made on 15 January 2016. The Tribunal also published reasons for decision that day.
2. The appellant lodged his Notice of Appeal within the time prescribed in clause 25(4)(b) of the Civil and Administrative Tribunal Rules 2014 (i.e. within 14 days). In lodging his Notice of Appeal the appellant sought an urgent stay of the orders of the Tribunal terminating the tenancy agreement. On 25 January 2016, the Appeal Panel, constituted by Deputy President, S Westgarth, made the following orders in regard to the appellant's stay application: "(1) The appeal is listed for call over at 2:15pm on 3 February 2016 at the Tribunal's hearing rooms at 175 Castlereagh Street Sydney for the purpose of conducting a call-over of the appeal from decisions made in RT 15/40779, RT 15/64236 and RT 15/63766 and for considering the appellant's application for a stay; (2) The appellant is to file and serve its (sic) evidence and submissions in support of the stay application by 4:00pm on Friday 29 January 2016; (3) The respondents are to file and serve their evidence and submissions in opposition to the stay application by 4:00pm on Tuesday 2 February 2016."
3. The Appeal Panel also provided written reasons as to why the appellant's urgent application for a stay was not dealt with in chambers at that time. The Appeal Panel said the primary reasons for not dealing with the stay application was the appellant's failure to explain why the application was urgent and that there was no evidence of a warrant for possession having been issued. The Registry was subsequently notified that a warrant had issued and there was a direction that the warrant should not be executed pending the determination of the appellant's stay application on 3 February 2016.
4. In accordance with the orders that were made on 25 January 2016, the appellant filed and served his written submissions on 29 January. The respondent filed their submissions in opposition on 3 February 2016.
5. On 3 February 2016, the Appeal Panel, constituted by Deputy President Westgarth, refused the appellant's application for a stay and made orders for the filing and serving of evidence and submissions in regard to the appellant's appeal. The Appeal Panel also set the matter down for hearing on 9 March 2016. Written reasons for the decision to refuse the appellant's application for a stay were not provided. Nor did the appellant make a request for written reasons: see Civil and Administrative Tribunal Act, subsection 62(2).
6. On 9 February 2016, the solicitor for the applicant wrote to the Tribunal and advised that the "appellant has decided not to proceed with the appeal and seeks to withdraw the appeal" and requested that the hearing of 9 March 2016 be vacated.
7. The Registry of the Tribunal wrote to the respondents' solicitor the following day informing them of the appellant's request to withdraw his appeal and requesting the respondents to advise, by 17 February 2016, of any objection they might have to the proposed withdrawal. A copy of that letter was also sent to the appellant. On 12 February 2016, the respondents' solicitor wrote to the Tribunal and advised that they had been instructed to seek the respondents' costs of the appeal, in particular their costs in regard to the appearance of their solicitor before the Appeal Panel and their costs in filing a response to the appellant's stay application.
8. On 25 February 2016, the Appeal Panel, constituted by Principal Member Redfern made the following orders in chambers: "1. Hearing of 9 March 2016 vacated. 2. The appeal is dismissed, save for the question of costs. 3. The Respondent to provide submissions as to why they say costs should be ordered by 3 March 2016. 4. The Appellant to provide any submissions in response by 17 March 2016. 5. The parties to provide submissions on whether the question of costs can be determined on the papers rather than a hearing at the same time as their submissions referred to in (3) and (4) above."
9. The respondents filed and served their submissions on costs on 29 February 2016. In their submissions, the respondents consented to the matter being determined on the papers.
10. On 1 March 2016, the appellant sent an email to the Registry stating that he wished to be heard on the respondents' application for costs. He also said that as his stay had not been granted he was forced to withdraw his appeal.
11. On 9 March 2016, the matter came before me in chambers to determine, on the basis of the submissions of the parties, whether a hearing was required: see Civil and Administrative Tribunal Act, subsections 50(2), (3) and (4). On this day I made the following orders after considering the submissions of the parties and the matters issue: "1. Pursuant to section 50(2) of the Civil and Administrative Tribunal Act 2013, the respondent's application for costs is to be determined on the papers. 2. Order 4 made on 25 February 2016 that the appellant provide submissions in response by 17 march 2016 is confirmed."
12. On 18 March 2016, the appellant sent his written submissions to the Registry by email.

The decision of the Tribunal below

1. The Tribunal had four proceedings before it. These were proceedings in file no RT 15/40779, RT 15/64236, RT 15/63766 and RT 15/50971.
2. As noted by the Tribunal in its reasons for decision, at [7], the primary application was that of the respondents in file no RT 15/40799 seeking an order for termination of the tenancy agreement and an order for possession of the premises on the basis of a Notice of Termination issued to the appellant, on 22 June 2015. The Notice was issued on the grounds of a breach of the tenancy agreement by the appellant; namely the applicant's failure to pay the rent outstanding as set out in the Termination Notice by the termination date: Residential Tenancies Act 2010 section 87(4). This application was supplemented with another application for an order for termination and possession (i.e. file no RT 15/64236) also on the grounds of a failure to pay rent: see Residential Tenancies Act 2010 section 88.
3. The remaining applications were those of the applicant, which the Tribunal explained were defensive in nature. At [39], the Tribunal noted that on 27 November 2015, when the four applications were before the Tribunal at a directions hearing, orders were made in regard to the hearing and the determination of the respondents' termination and possession applications on 15 January 2016. An order was also made for the appellant's application for orders in regard to repairs, rent reduction and/or compensation to be heard and determined on another day. I have assumed that this application of the appellant was file no RT 15/50971, as this was the matter in which the Tribunal did not make any final orders, but listed it for further directions.
4. At [12] of its reasons for decision, the Tribunal noted that at the commencement of the hearing, the appellant sought an adjournment because various summonses for persons to appear at the hearing and give evidence had not been able to be served and he had been given an opportunity to adequately prepare for the hearing. The Tribunal noted that appellant had requested the issue of the summonses on 24 December 2015. The Tribunal found that there was no explanation as to why the summonses had not been requested earlier and on that basis rejected the appellant's application for an adjournment.
5. At [47] of its reasons for decision, the Tribunal identified the issues for determination as follows: "47 The real contest in this application is whether or not at the time of the Notice. The Respondent [appellant in this appeal] had tendered rent to R & W acting for the Applicants, so as to discharge his liability under the Agreement and render him immune from the effect of the Notice; or alternatively whether he was in arrears of rent at least 14 days, and thus susceptible to service of the Notice, and liable to meeting its requirements."
6. At [48], the Tribunal noted that the respondents' evidence was largely dependent upon the forensic accounting report of the respondents' expert, Mr Fisher. At [52], the Tribunal said it accepted and found "as a fact" that the appellant was, as at 22 June 2015 "being the date of the Notice, in arrear as to rent by 16 days" under the tenancy agreement. In the following paragraph the Tribunal said it made this finding "by reason of Mr Fisher being the only person qualified to reconcile the moneys which have been received by R & W from any source attributable to the Respondent."
7. The appellant's case was that payments for rent had been made to the leasing agent, R & W. The appellant put into evidence copies of receipts for payments that he said were made to Mr Emerson, of R & W, on account of rent. At [71] of its reasons for decision, the Tribunal rejected the appellant's contention and found that the moneys to which the receipts related could "not be considered to be and accounted as rent in the R & W ledger recording moneys paid" by the appellant to the respondents under the tenancy agreement. The Tribunal went on to explain why the evidence of the appellant did not impugn the evidence in Mr Fisher's report and why it should be rejected.
8. At [109] the Tribunal found that on the basis of the evidence advanced by the respondents it was "comfortably satisfied" within the meaning of subsection 87(4) of the Residential Tenancies Act that the appellant had breached the tenancy agreement, that the breach was sufficient to justify termination of the agreement, the Termination Notice was given in accordance with that subsection and the appellant had not vacated the premises as required by the Notice. On the basis of these findings the Tribunal made an order, in file no RT 15/40779, that the tenancy agreement between the parties was terminated. The Tribunal also made an order under subsection 83(1) of the Residential Tenancies Act that the appellant give possession of the premises the subject of the residential tenancy agreement to the respondent within seven days.
9. The Tribunal also made an order dismissing the proceedings in file nos RT 15/64236 and RT 15/63766. As I have already noted the appellant's proceedings in file no RT 15/50971 were listed for further directions.

The appellant's Notice of Appeal and Stay Application

1. In his Notice of Appeal the appellant challenged the orders made by the Tribunal below in each of the proceedings before it, other than the orders made in regard to the appellant's claim that was file no RT 15/50791.
2. The grounds of appeal were stated to be: "1) The Tribunal erred in its assessment of the evidence, and failed to give proper reasons to determine that the Termination Notice dated 22 June 2015 was valid within the meaning of s88 of the Residential Tenancies Act 2010. 2) The Tribunal erred in its assessment of the evidence, and failed to give proper reasons in finding that the Appellant had breached the agreement, namely that it was in arrears of rent for more than 14 days at the time the Termination Notice was served. 3) The Tribunal failed to give proper reasons why the alleged breach of the agreement was sufficient to justify termination of the agreement within the meaning of s87(4) of the Residential Tenancies Act 2010. 4) The Tribunal did not allow procedural fairness to the Appellant in refusing an adjournment of the Appellant."
3. In his Application for a Stay, the appellant said that by enforcing the orders in file no RT 15/40779 before his appeal was heard would render his appeal useless. In this regard the appellant noted that the orders included an order that he give possession of the premises to the respondent and if possession were enforced, this could not be rectified if he were successful in his appeal.

The submissions of the parties

1. The respondents submit that the following matters are circumstances warranting an award of costs: 1. the appellant's appeal and stay application had no reasonable prospects of success; 2. the appellant conducted the proceedings in a way that unnecessarily disadvantaged the respondent. In this regard the respondent noted the appellant used the appeal process for his sole advantage to continue to occupy the respondents' property while having paid no rent since May 2015. The rent outstanding as at 3 February 2016 was $65,584.34; 3. the appellant's applications had no basis in fact or law; 4. the appellant's appeal and stay application was based on his general dissatisfaction with the outcome of their application that was file number RT 15/40779; 5. the appellant's appeal and stay application were frivolous and vexatious and otherwise misconceived and lacking in substance; 6. the appellant failed to comply with the duty imposed on him under subsection 36(3) of the Civil and Administrative Tribunal Act in that he failed to identify any issue of law and his failure to immediately withdraw his appeal once the stay was refused.
2. It is on this basis that the respondents contend their costs in preparing for and appearing at the stay hearing on 3 February 2016 were wasted.
3. In his email of 1 March 2016, the appellant raised issues of concern about the Appeal Panel refusing his application for a stay. He noted he was in hospital on the day of the hearing and unable to give instructions to his legal representatives at that time.
4. In his subsequent email, sent on 18 March 2016, the appellant said: 1. he felt he had not been dealt with fairly in the first place and was not provided with procedural fairness; 2. the original notice served on him was unlawful and this was a matter not dealt with effectively by the Tribunal below; 3. prior to lodging his appeal he sought legal advice and this appeal and stay application were prepared by his legal representative; 4. the failure of the Appeal Panel resulted in in his appeal being rendered useless and as such he was left with no alternative but to abandon his appeal; and 5. he re-iterated he was in hospital on 3 February 2016. He said he had been informed the Appeal Panel had considered a stay if he could pay $60,000 by the close of business that day. He said that the Tribunal had not made any orders for the payment of money and that his application before the Tribunal below was still pending at that time. He also noted that the amount of $60,000 was outside the jurisdictional limit of the Tribunal in residential tenancy matters.

Consideration

1. As can be seen from the terms of subsection 60(1) of the Civil and Administrative Tribunal Act, the starting point in the respondent's application for costs is that each party pay its own costs. Subsection 60(2) gives the Tribunal a discretion to award costs if it is satisfied that there are "special circumstances warranting the award of costs." That is, even if the Tribunal is satisfied there are special circumstances, the Tribunal must also be satisfied that such circumstances warrant an award of costs.
2. The matters the Tribunal can have regard to in determining whether there are special circumstances warranting an award of costs are those set out in subsection 60(3).
3. In Megerditchian v Kurmond Homes Pty Ltd at [11], the Appeal Panel cited with approval the meaning of the expression "special circumstances" that had been given to the same expression in the former section 88 of the Administrative Decisions Tribunal Act 1997 (NSW) by the Court of Appeal in Cripps v G & M Mawson [2006] NSWCA 84 at [60]. That is, special circumstances are "circumstances that that are out of the ordinary" - they do not have to be "extraordinary or exceptional".
4. In ACT Builders v Haridemos (No 2) [2016] NSWCATAP 118 at [41], the Appeal Panel noted that the mere fact a party was unsuccessful in their appeal does not of itself give rise to special circumstances warranting an order for costs in favour of the other party. The same applies where the appealing party was successful in their appeal.
5. The onus is on the party seeking an order for costs to satisfy the Tribunal that there are special circumstances warranting an award of costs in their favour.
6. While the respondents contend the appellant's appeal had no reasonable prospect of success, the appeal and the stay application were frivolous and vexatious, the appellant's applications had no basis in fact or law and the appellant had conducted his appeal in a manner that unnecessarily disadvantaged them they have not referred to any material which supports these contentions other than they were successful at first instance. As I have noted, this is not a sufficient basis to give rise to special circumstances warranting and exercise of the discretion to depart from the general rule that each party pay its own costs.
7. On the other hand the appellant did not delay in lodging his appeal. While particulars were not provided, the grounds of appeal in the appellant's Notice of Appeal identified a number of alleged errors of law. Having had his application for a stay refused the appellant did not unduly delay in advising that he did not wish to proceed with his appeal.
8. In the absence of reasons for the decision to refuse the appellant's application for a stay it is difficult to determine whether the appellant's application for a stay lacked merit. But what is evident is that the appellant did not seek to delay the hearing of his stay application. Again it was dealt with expeditiously.
9. Accordingly, I find the respondents have failed to establish special circumstances that warrant an order that the appellant pay their costs of the appeal, in particular their costs relating to the appellant's stay application.
10. On the basis of my findings the appropriate order is to dismiss the respondents application for cost.

Order 1. The respondents' application for costs is refused.

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: 29 May 2018