B & W Windows (Residential) Pty Ltd v Franjulis; Franjulis v B & W Windows

NCAT Consumer and Commercial|2020-01-17

Background

On 1 February 2017, Senior Member Harris SC published his determination and reasons in matters HB 15/56878 and HB 15/60326.
Matter number HB 15/56878 is the claim of Nicholas Frangulis against B & W Windows (Residential) Pty Ltd.
Matter number HB 15/60326 is the claim of B & W Windows (Residential) Pty Ltd against Nicholas Frangulis.
I am not aware of the reasons why this application for costs has been delayed until now, nor why, as is the case, that Senior Member Harris is unavailable to make the determination on costs, but it appears from the Tribunal's file that the parties have been advised of this situation, and that another Member is to decide the costs application.
I note that I have the benefit of Member Harris's detailed decision and reasons, and the documentary evidence provided by the parties. I have considered those documents. I have also sought to make this determination on costs based on clear evidence or undisputed facts and the reasons of Member Harris. I have striven to avoid speculation or assumptions not supported by the evidence, undisputed facts and the Member's reasons. Of course, I have attempted to apply the statutory and, if necessary and appropriate, common law to the above evidence, undisputed facts and reasons.
In these reasons I will refer to Nicholas Frangulis as the owner and to B & W Windows (Residential) Pty Ltd as the builder.
The owner's claim sought orders that he did not have to pay the amount of $19,950.00 to the builder, that the builder was to pay him the amount of $200.00 and for the builder to deliver, return or replace specified goods to the approximate value of $5,000.00. There were additional orders for the builder to remove its windows from the building site and to reinstate the original window. At the date of lodging the application the cost of the additional orders had not been calculated. The total amount claimed (not including the unknown costs) was $25,150.00.
The builder's claim sought an order for payment of the sum of $9,999.00 being the amount alleged to be outstanding from the contract price.

Legislation

Section 60 of the Civil and Administrative Tribunal Act 2013 provides: 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 Pr ofession 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.
Rules 38 and 39 of the Civil and Administrative Tribunal Rules 2014 provide: 38 Costs in Consumer and Commercial Division of the Tribunal (1) This rule applies to proceedings for the exercise of functions of the Tribunal that are allocated to the Consumer and Commercial Division of the Tribunal. (2) Despite section 60 of the Act, the Tribunal may award costs in proceedings to which this rule applies even in the absence of special circumstances warranting such an award if: (a) the amount claimed or in dispute in the proceedings is more than $10,000 but not more than $30,000 and the Tribunal has made an order under clause 10 (2) of Schedule 4 to the Act in relation to the proceedings, or (b) the amount claimed or in dispute in the proceedings is more than $30,000. 39 Interest on judgment debt (1) This rule applies if a party to proceedings has made a successful civil claim against another party for the payment or recovery of any debt, demand or damages (whether liquidated or unliquidated). (2) Interest is payable on the outstanding balance for the time being of money adjudged by the Tribunal to be payable and which, being due, remains unpaid. (3) Such interest is payable at a rate equal to the rate for the time being prescribed for the purposes of section 101 of the Civil Procedure Act 2005.
Section 4 of the Civil Procedure Act 2005 provides as follows: 4 Application of Parts 3-10 (1) Subject to this section, Parts 3-9 apply to each court referred to in Schedule 1 in relation to civil proceedings of a kind referred to in that Schedule in respect of that court. (1A) Part 10 applies in relation to civil proceedings in the Supreme Court. (2) The uniform rules may exclude any class of civil proceedings from the operation of all or any of the provisions of Parts 3-9. (3) The Governor may, by regulation, amend or substitute Schedule 1. (4) A regulation under this section may contain provisions consequent on the amendment or substitution of Schedule 1, including: (a) provisions excluding any class of civil proceedings from the operation of all or any of the provisions of Parts 3-9, and (b) provisions modifying any specified provision of Parts 3-9, or of any other Act or law, in its application to any class of civil proceedings. (5) Subject to any such regulation, this Act does not limit the operation of any other Act with respect to the conduct of civil proceedings.
Schedule 1 of the Civil Procedure Act 2005 provides as follows: Schedule 1 Application of Act (Section 4) Column 1 Column 2 Court Kinds of civil proceedings Supreme Court All civil proceedings Land and Environment Court All civil proceedings in Class 1, 2, 3, 4 or 8 of the Court's jurisdiction Industrial Relations Commission All civil proceedings District Court All civil proceedings Dust Diseases Tribunal All civil proceedings All civil proceedings under Part 3 of the Local Court Act 2007 All civil proceedings under the Property (Re lationships) Act 1984 Local Court All civil proceedings that are substituted proceedings within the meaning of Part 3A of the Civil and A dministrative Tribunal Act 2013 Note. Section 34C of the Civil and Administrati ve Tribunal Act 2013 modifies the application of this Act. Those modifications prevail because of section 34D of that Act. All civil proceedings for which the Local Court has jurisdiction under section 91 of the Crimes (Domestic and Personal Violence) Act 2007 …

Section 48O of the Home Building Act 1989 provides as follows: 48O Powers of Tribunal (1) In determining a building claim, the Tribunal is empowered to make one or more of the following orders as it considers appropriate: (a) an order that one party to the proceedings pay money to another party or to a person specified in the order, whether by way of debt, damages or restitution, or refund any money paid by a specified person, (b) an order that a specified amount of money is not due or owing by a party to the proceedings to a specified person, or that a party to the proceedings is not entitled to a refund of any money paid to another party to the proceedings, (c) an order that a party to the proceedings: (i) do any specified work or perform any specified service or any obligation arising under this Act or the terms of any agreement, or (ii) do or perform, or refrain from doing or performing, any specified act, matter or thing. (2) The Tribunal can make an order even if it is not the order that the applicant asked for. (3) Sections 79R and 79T-79V of the Fair Tradi ng Act 1987 apply, with any necessary modifications, to and in respect of the determination of a building claim.

Interest

The builder claims interest under Rule 39 of the CAT Rules. The builder's submissions note that no order for interest was made by Member Harris and that "[t]he Tribunal appears not to have addressed this question".
The builder submits that interest under Rule 39 is payable at the rate prescribed in s 101 of the Civil Procedure Act 2005 (CP Act). Calculations on that basis are attached to the submissions of the builder.
The builder also submits that the right to the "contractual damages" (being the unpaid balance of the contract price) "arose on 20 February 2015, when Mr Frangulis repudiated the contract". The builder's calculations of interest therefore commence on 20 February 2015.
I reject that submission and do not allow interest calculated on that basis. In my opinion the clear sense of Rule 39 of the CAT Rules is that interest may be allowed only from the date of "a successful civil claim against another party …" which I take to be the date of Member Harris's decision.
As an alternative submission, the builder submits that if Rule 39 does not apply interest is payable as damages under s 48O of the HB Act. The basis of the submission is that interest is payable on damages for breach of contract is compensation for the loss of use of the money that the builder ought to have been paid.
The submission in the previous paragraph is made on the authority of The Craftsmen Restoration and Renovations v Thomas Boland, Thomas Boland v the Craftsmen Restoration and Renovations [2008] NSWSC 660 (Craftsmen) at [139]-[143], based on Hungerfords v Walker (1989) 171 CLR 125 (footnote 4 in the builder's submissions). No analysis or discussion is provided in relation to the nature and application of the legal principle stated in paragraph 1 9.
For the reasons which follow further below, I do not accept this submission of the builder but first it is necessary to consider with more exactitude the nature of the common law principle referred to by the builder.
I note first that in Craftsmen, Howie SCJ did indeed make an award of interest based on the common law principle submitted for in the case before him: [141] … The Tribunal ruled that interest was not payable under the Uniform Civil Procedure Act but not otherwise. The Tribunal may be forgiven for making this error as the owners nominated the authority for their claim as the provisions of that Act. However interest was payable on the common law principle stated in the passage quoted above from Amery and it seems to follow from that decision that there was an error of law on the part of the Senior Member in limiting the consideration of interest to a specific Act.
As is clear from the passage extracted in paragraph 22 above, Howie SCJ did not refer directly to Hungerfords v Walker but rather to Amery v New South Wales (Director-General, NSW Dept of Education and Training) [2004] NSWCA 404 (Amery). In Amery, at paragraphs [148]-[154], Beazley JA (with whom Hodgson JA, in dissent otherwise, and Cripps AJA agreed), after referring to Hungerfords v Walker, stated: Interest [148 The appellants claimed interest on any damages they may be awarded. This claim was determined by the presiding member as he considered that it raised an issue of law: see Administrative Decisions Tribunal Act, s.78(2). The judicial member refused the claim for interest on essentially two grounds. First, he considered that, there being no provision in the ADA for the award of interest, and no authority that the Tribunal had the power to award interest, no award should be made. Secondly, he considered that as the matter had been raised late in proceedings, any interest which would have been made would have only been from the time of amendment so that an order would be of no utility. [149] The appellants appealed against this decision to the Appeal Panel. However, as the Appeal Panel upheld the Department's appeal, it did not consider the question. The appellants now claim that the judicial member erred in law in finding that interest was not payable. They relied principally upon the decision of the High Court in Hungerfords v. Walker (1989) 171 CLR 125. The question in issue in that case was stated by Mason CJ and Wilson J at the outset of their judgment. They said, at p.132: "This appeal raises the important question whether, at common law, a court, when awarding damages for breach of contract or negligence, can include in its award damages, assessed by reference to appropriate interest rates, for the loss of the use of money which the plaintiff paid away and lost as a direct consequence of the defendant's breach of contract or negligence." [150] Their Honours held that interest was payable, essentially on the basis that a successful plaintiff was entitled to restitutio in integrum. Their Honours' said: "According to that principle, the plaintiff is entitled to full compensation for the loss … [sustained] in consequence of the defendant's wrong, subject to the rule as to remoteness of damage and to the plaintiff's duty to mitigate … loss. In principle, [the plaintiff] should be awarded the compensation which would restore him to the position he would have been in but for the defendant's breach of contract or negligence. Judged from the commercial viewpoint, the plaintiff sustained an economic loss if his damages are not paid promptly just as he sustains such a loss when his debt is not paid on the date." (emphasis added) [151] Brennan and Deane JJ said at 152: "… there is no acceptable reason why the ordinary principles governing recovery of common law damages should not, in an appropriate case, apply to entitle a plaintiff to an actual award of damages as compensation for a wrongfully and foreseeably caused loss of the use of money." [152] The appellants submit that in this case the teachers' claim for damages is a claim for the amount they ought to have been paid from 1996 arising out of their Department's discriminatory conduct. The appellants submit that, as a matter of law, interest is payable and in this case, ought to have been paid in order to properly compensate them for the loss they had sustained. The claim for interest will of course only be of utility to those appellants who were awarded damages below the maximum of $40,000.00. [153] In my opinion, the judicial member refused the claim for interest on the substantive basis that there was no authority that supported the proposition. He did not however, enter upon a determination as to whether as a matter of law a claim for damages under the Act could include a claim for compensatory interest. In my opinion, by failing to consider this question, he erred in law. Accordingly, the discretionary consideration that he relied upon, namely the late making of the claim for interest, does not need to be considered. [154] In my opinion, as a matter of law, the appellants are entitled to interest by way of compensation for the loss of the use of the money that ought to have been paid to them by way of salary but for the discriminatory condition. This is not a matter where I would reject any claim under the guise of refusing an amendment to their claim. As the appellants point out, the Department did not claim that it was in any way prejudiced by the late amendment. Accordingly, I am of the opinion that an award of interest should have been made in those cases where the award of damages was less than $40,000.00. However, there has been no argument before this Court as to the rate of interest and therefore the additional quantum of damages that ought to have been awarded. I would propose to give the parties liberty to apply in case they cannot reach agreement on that matter.
Amery was an appeal from a decision of an Appeal Panel of the Administrative Decisions Tribunal (ADT) in a case brought under the Anti-Discrimination Act 1997 (A-D Act). In the case at first instance before a single member, that member determined that the A-D Act made no provision for an award of interest and that the ADT otherwise had no power to award interest.
Craftsmen was an appeal from a decision of Senior Member Paull in the Consumer Trader and Tenancy Tribunal, a predecessor of this tribunal. In her decision, Member Paull noted or inferred that the claim for interest was brought pursuant to the CP Act and declined to award interest as the CP Act did not apply to the Tribunal.
Both Amery and Craftsmen were subject to appeal is not the findings in relation to interest in each matter were not overturned.
In the absence of submissions from either party that those two cases (and Hungerfords v Walker) are not still good law, I would be prepared to accept the builder's submission that an award of interest could be made under the common law.
However, upon careful consideration of each of those cases it is apparent that such an award of interest would be by way of common law damages and, as was pointed out in Amery at [154], that claim would be included in the total quantum of damages awarded and following the provision of evidence and argument in relation to the appropriate rate of interest.
It is not clear to me that a claim for interest was made before Member Harris and there was certainly no reference in the decision to any such claim nor to any evidence which would support an appropriate determination of interest.
A further difficulty, or rather a related difficulty, in making an appropriate determination of interest arises from the specific lack of any evidence in relation to the appropriate interest rate. As Schedule 1 of the CP Act makes clear, that Act does not apply to this Tribunal. Howie SCJ, who referred to the "Uniform Civil Procedure Act" (a formulation apparently included in the reasons of Member Paull) but clearly intended to refer to the CP Act, purported to select the interest rate formula has provided in that Act. There was no discussion as to why that was appropriate or required.
In any case, in my opinion it is not appropriate to include such an award when considering an application for costs. To the best of my knowledge the decision of Member Harris was not appealed and in my opinion that would be the only avenue available to a party aggrieved by there being no award for interest.
For those reasons I dismissed the application for interest.

Costs

I have extracted the relevant provisions from the CAT Act and the CAT Rules above.
The first issue to be considered is whether Rule 38 applies. In that regard, it has been suggested that the combined amounts in the two applications provides the relevant figure. I do not agree with that submission. There are two separate cases and the amount in dispute or claimed in each of those cases is less than $30,000.00. In making an application for costs, it is necessary for the party or parties making such an application to do so in relation to each case. On that basis Rule 38(2)(b) does not apply. (Rule 38(2)(b) does not apply in any case.)
It is therefore necessary to consider the provisions of s 60 of the CAT Act - that is, are there "special circumstances" warranting an award of costs in these proceedings.
I deal first with the vigorous submission of the owner to the effect that the Tribunal several times refused an application by the builder to be legally represented.
As such leave was not granted, in my opinion the builder is not entitled to claim the costs of such representation. Although the reasons of Member Harris make it clear that Mr Dalgleish of counsel was present in the hearing room, he stated: "[5] … I took the view that it was not open to me to review those decisions and the previous rulings stood. However, I could see no reason why he should be excluded from the hearing room and he remained and Mr Pawa consulted him on some occasions with my permission. I could see no basis for concluding that unfairness was caused to the applicant by this course and the Tribunal was assisted by it. In my opinion, the hearing would have been significantly extended had Mr Dalgleish not been present."
Section 60 of the CAT Act defines "costs" as: 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. That is quite a broad definition and in my opinion includes the giving of legal advice and assistance in the preparation of evidence and assistance in preparing a claim for hearing in the Tribunal.
Therefore, in my opinion, the fact that leave has not been granted for a party to be represented does not prevent that party from making an application for legal costs and in appropriate circumstances succeeding in obtaining an award of legal costs.
The builder claims special circumstances on three bases: "the nature and complexity of the proceedings" (s 60(3)(d) of the CAT Act), the Calderbank offers made by the builder and the serious allegation this made by the owner that the builder had produced and sought to rely on a contract that was inaccurate (in effect, a forgery).
The builder make no submissions in relation to the nature and complexity of the proceedings, but merely presents that submission as though it should automatically be accepted. In any case, in my opinion the detailed reasons of Member Harris do support such a submission.
Before turning to the other "special circumstances" I will consider the submissions in reply by the owner.
The owner relies on the refusal to grant leave for legal representation and suggests that awarding legal costs to the builder at this stage would be the equivalent of overturning the refusal of leave. For the reasons given above I do not agree with that submission and consider it is misconceived.
In relation to "special circumstances", the owners submits there are special circumstances in his favour, that is that the builder had a barrister "putting their case together for them".
Secondly, the owners submits that the Calderbank offers were not fair and reasonable because, as he put it, he paid 50% of the cost of the project and received nothing in return.
Thirdly, in relation to the "inaccurate" contract, the owner essentially seeks to argue that position again. Member Harris has already definitively determined that issue. This
Returning to consider the Calderbank offers of 09 November 2015 and 30 March 2016, I note copies of each offer were included with the builder's submissions.
Although the owner considers that the offers were not fair and reasonable on the basis just described, as was pointed out with great clarity in each offer the issue is that if the offer is not accepted by the offeree and the Tribunal makes a determination and orders which are no more favourable to the offeree than the offer, then the offer or may seek an order for costs from the date of the offer.
In my opinion each of the offers is a model of clarity. Each contains a reasonable estimate or rather opinion as to the state of the evidence and the relative strengths of the parties' cases, summarises the effect of the CAT Act and CAT Rules in relation to costs and recommends that the owner obtain legal advice.
Again in my opinion, the offers do not contain any exaggerated estimates nor attempt to bamboozle or bully the owner, or to frighten the owner into acceptance. I would describe them as reasonable and professional in their tone and content.
It may be objected that the first offer, that of 09 November 2015, included the submission in relation to Rule 38 which I rejected in paragraph 34 above. While that is true, I do not consider that fact removes or lessens the effectiveness of the offer as a Calderbank offer. The offer goes on to make submissions "in any event" pursuant to s. 60 of the CAT Act.
In other circumstances I would have little hesitation in finding that the Calderbank offers support and order for costs as claimed. However, it is still necessary to determine whether the existence of these two offers of itself is a "special circumstance".
"Special circumstances" are circumstances that are out of the ordinary. They do not have to be extraordinary or exceptional: Megerditchian v Kurmond Homes Pty Ltd [2014] NSWCATAP 120 at [11], citing Santow JA in Cripps v G & M Mawson [2006] NSWCA 84 at [60].
In Thompson v Chapman [2016] NSWCATAP 6, the Appeal Panel summarised the relevant considerations in relation to Calderbank offers as follows: [91]… From cases such as SMEC Testing Services Pty Ltd v Campbelltown City Council [2000] NSWCA 323 at [37], Miwa Pty Ltd v Siantan Properties Pty Ltd (No2) [2011] NSWCA 344 and Nu Line Construction Group Pty Ltd v Fowler [2012] NSWSC 816 at [48]. The [sic] following principles can be derived in respect of whether a special order for costs should be made: (1) there must be a real and genuine element of compromise; (2) the refusal must be unreasonable; (3) the reasonableness in rejecting an offer must be considered at the time the offer is made, not with the benefit of hindsight; (4) relevant factors in relation to whether the rejection was unreasonable include: (a) the stage of the proceedings at which the offer was received; (b) the time allowed to consider the offer; (c) the extent of the compromise offered; (d) the offeree's prospects of success, assessed at the date of the offer; (e) the clarity with which the terms of the offer were expressed; (f) whether the offer foreshadowed an application for indemnity costs in the event of each rejection.
I find that the terms of the Calderbank offers in these proceedings comply with the above requirements, except of the foreshadowing of an application for indemnity costs in the earlier of the offers. The offer dated 30 March 2016 does foreshadow an application for indemnity costs.
I have searched for any Appeal Panel decision, or any decision of a Court of Record, which determines whether an effective Calderbank offer will support the exercise of the discretion to make an award of costs on the basis that the offer represents a special circumstance.
The issue which concerns me is that a Calderbank offer is most often, in my experience, the basis for seeking or awarding costs on an indemnity basis. As just noted, that is true of the second offer in the current proceedings.
However, the issue I am considering presently, is whether a Calderbank offer which fulfils the necessary criteria of being a genuine compromise and which the offeree acted unreasonably in refusing, can also, or instead, support or justify a finding, of itself, that "special circumstances" exist.
There are many cases in which a more general statement of the effect of a Calderbank offer is made, not just in relation to a claim or award of indemnity costs. For example, in the recent Court of Appeal decision in Singapore Airlines Cargo Pte Limited v Principle International Pty Ltd (No 2) [2017] NSWCA 340 it was stated: [30] Calderbank offers are a well-established means of parties seeking to compromise proceedings in circumstances where, provided that the offer is a genuine offer of compromise and the opposing party unreasonably rejects the offer, the court may, in the exercise of its discretion, make a special costs order in favour of the offeror. … [Emphasis added]
However, even though in that paragraph the Court used the general phrase "a special costs order", the succeeding words and paragraphs referred specifically to indemnity costs.
In Zucker v Burbank Montague Pty Ltd [2018] NSWCATAP 135, an internal Appeal Panel discussed the issue, or a similar issue at least, as follows: [60] Despite finding that the refusal of the Calderbank offer was not unreasonable or imprudent, the Tribunal went on to find that, the refusal of the Calderbank letter, together with the claim having no tenable basis in fact or law and lacking substance, constituted special circumstances. [61] The respondents submit that as the Tribunal found that "in hindsight" the appellant "would have been better off accepting the offer", the refusal of the offer could be considered a contributory factor, which in combination with other special circumstances, was capable of reaching the threshold for special circumstances. [62] The Tribunal's rejection of the respondents' submission that the failure to accept the Calderbank offer constituted special circumstances at [11.2] of the decision seems logically inconsistent with its reliance on rejection of the offer as part of what constitutes special circumstances at [14] of the decision. That said, we agree with the submission that the refusal of a Calderbank offer, even if it does not amount to special circumstances on its own, could amount to special circumstances when considered in conjunction with other factors. [Emphasis added]
In my opinion two decisions of the Appeal Panel make it sufficiently clear that a Calderbank offer, indeed even an offer which does not meet the all the criteria of a Calderbank offer, can support a submission that special circumstances apply.
In Brunsprop Pty Ltd v Joanne Hay & Wes Davies [2015] NSWCATAP 152, the Appeal Panel stated: [21] We accept the proposition that the unreasonable refusal of an offer of compromise may constitute special circumstances for the purposes of s 60(2) of the Act, regardless of whether the offer is expressed to be a Calderbank offer. Whether the rejection of an offer can be said to be unreasonable requires consideration of the terms of the offer made and all of the surrounding circumstances: King Network Group Pty Ltd v Club of the Clubs Pty Ltd (No 2) [2009] NSWCA 204 at [11]. [Emphasis added]
In Integrity Homes Pty Ltd v Staniland [2015] NSWCATAP 284, the Appeal Panel stated: [61] A further significant relevant matter is the failure of the builder to agree to the settlement offer made by the owners on 19 October 2015. The offer was for the appeal to be withdrawn and for there to be an order for the builder to pay the owner's costs of the appeal. The hearing of the section 43 application would have continued in the Tribunal. The result that was obtained from refusing the settlement offer was a worse result for the builder because the builder incurred the subsequent costs of preparation for the appeal hearing, the appeal hearing itself and written submissions on costs. That could all have been avoided by the builder agreeing to the proposed settlement. This decision of the builder resulted in both parties incurring considerable unnecessary costs after 19 October. It prolonged the appeal proceedings. It unnecessarily disadvantaged the owners. This is a very significant factor under paras 60(3)(a), (b) and ((f) to be taken into account in deciding whether there are special circumstances that justify a costs order. [Emphasis added]
On the basis of the above consideration, I find that the current Calderbank offers can be considered in relation to a finding that special circumstances do, or do not, exist.
In that regard, I find that each Calderbank offer was a genuine offer to compromise, and that each offer represented a considerable benefit to the owner compared to the decision eventually made by Member Harris.
I am satisfied that taking into account the time the offers were made and the progress of the proceedings at each respective date of the offers and the eventual outcome, it was unreasonable for the owner to reject the offers. I make the finding in relation to each offer, because it will be necessary to consider below whether each offer can be utilised in distinction to the other offer.
Without unnecessarily summarising the reasons of Member Harris, but considering particularly the determination of the terms of the contract and his consideration of the repudiation and termination of that contract, I am satisfied that the nature and complexity of the proceedings was such as to warrant an award of costs in favour of the builder pursuant to s 60(3)(d) of the CAT Act.
I am also persuaded that the owner's allegations in relation to the contract document unreasonably prolonged the time taken to complete the proceedings and so contributes to a finding of special circumstances pursuant to s 60 (3) (b) of the CAT Act.
I note the vigour of the submission in relation to the contract in the owner's costs submissions. However, comparing those submissions with the reasons at paragraphs [71]-[74] of Member Harris's reasons, it appears to me that the submissions are you in a different point to that made by Member Harris and also different to the builder's submission on that issue.
I find that special circumstances exist for the purposes of s 60 of the CAT Act.
The second Calderbank offer contained in the letter dated 30 March 2016 put the owner squarely on notice that the builder would rely on that letter to support an application for costs on an indemnity basis. I note that the application was to date from the date of the first of three offers, being 06 November 2015.
I have already found that it was not reasonable for the owner to reject either of the two written offers, supporting a finding that a costs order is warranted on the basis that special circumstances exist. I find now that the owner is to pay the costs of the builder of and in relation to the proceedings on the ordinary basis up to 30 March 2016 and on an indemnity basis thereafter.

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

Amendments 29 March 2022 - Casename updated 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 March 2022

At a glance

Court

Decision date

Source

Judgment (7 paragraphs)

Legislation Cited (4)

Cases Cited (14)