1. The respondent filed its costs application on 17 July 2025, in which it is seeking the following costs:
   1. Legal costs of:

(a) $429.00 for the preparation of an offer of settlement to the applicant on 20 May 2024 (1 hour);

(b) $484.00 for the review of an expert report from the applicant on 8 August 2024 (1 hour);

(c) $7,260.00 for preparation for the final hearing between 11 and 25 March 2025 (15 hours);

(d) $2,574.00 for attendance as counsel on the first day of hearing on 26 March 2025 (6 hours); and

(e) $2,145.00 for attendance as counsel on the first day of hearing on 26 March 2025 (5 hours).

(a) $9,900.00 for reviewing and responding to the applicant's expert report prepared by Airey Taylor Consulting;

(b) $4,537.50 for attending the expert witness conferral, liaising with the applicant's expert witness, and preparing the joint expert report; and

1. The respondent's submissions in support of its costs application are as follows:
   1. The respondent submits that the applicant's claim and actions in prosecuting his claim have been inappropriate, or in the alternative unmeritorious, vexatious or grossly exaggerated for the following reasons:

(a) The quote provided by the applicant in support of his claim for the reconstruction cost of the patio is:

(i) based on a 'sketch provided by [the applicant]', but no details of the sketch are provided;

(ii) for a free-standing patio as opposed to the supported patio that the applicant contracted the respondent to build; and

(iii) details 'upgraded Columns of 100 x 1000 SHS and upgraded beams as detailed on the sketch provided'.

(b) The applicant sought and failed to obtain punitive damages in the amount of $10,000.00, but the applicant provided no evidence regarding this element of his claim.

(c) The applicant has claimed legal costs of $28,877.83 despite not being represented at any stage in the proceeding.

(d) The amount awarded to the applicant was only $233.00 which was less than 1% of the claim advanced by the applicant.

(e) The applicant installed electrical conduit through his hose gutters (thereby decreasing their capacity) and then sought to blame the inability of those gutters to handle rainfall on the respondent's construction of the patio.

(f) The applicant unreasonably refused to accept both a without prejudice offer of settlement and an open offer of settlement.

(g) The video evidence of the applicant shows an outdoor rug and outdoor chair under the patio, with the implication that despite the applicant's insistence that the patio was not fit for purpose, he has in fact used the patio in the 7 years from when it was constructed.

1. The respondent refers to a without prejudice, save as to costs, offer of settlement made by it to the applicant on 30 November 2023 (respondent's November 2023 settlement offer), a copy of which is included in the respondent's costs application, which proposed:

(a) that the applicant consent to the respondent applying to the City of Cockburn for a building approval certificate with the respondent paying for all costs associated with the application;

(b) if a building approval certificate was granted then the matter would be settled and the applicant would withdraw the complaint;

(c) if a building approval certificate was not granted the respondent would rectify any issues raised by the City or, if the City required the patio to be removed completely then the respondent would do that and refund to the applicant the amount he had paid for the patio;

(d) that the applicant allow access to his property for the patio to be inspected by a 'building certifier' and for any alterations required to be undertaken by the respondent;

(e) drew the attention of the applicant to the obligation for him to mitigate his loss; and

(f) was stated to be made on the Calderbank principles and was open for acceptance by the applicant for a period of 21 days.

1. The respondent submits that the applicant's rejection of that offer of settlement was unreasonable because there was no cost to the applicant in making an application for a building approval certificate and the respondent would undertake any work at its cost which might be required prior to a building approval certificate being issued or remove the patio at its cost and refund all the money the applicant had paid for the patio if the City of Cockburn required the patio to be removed.
2. The respondent also refers to a letter sent to the applicant by the respondent's legal representative dated 22 May 2024 (respondent's May 2024 settlement offer), which was put into evidence during the final hearing on 26 and 27 March 2025 and dealt with in Review Decision. However, the respondent has not made any submission regarding the terms of that offer, other than to submit that in light of the applicant's rejection of both the respondent's November 2023 settlement offer and the respondent's May 2024 settlement offer, the Tribunal should exercise its discretion to award costs to the respondent.

1. The principles applicable in respect of an application for costs in a proceeding under the BSCRA Act have recently been well summarised by Member Benter and Sessional Member Woodforde in Petsos and Judd [2025] WASAT 26 (S) at [19] - [29] as follows:
   1. The SAT Act provides that the general starting position in Tribunal proceedings is that each party bears their own costs[6], but that the Tribunal has discretion to make an order for the payment of costs where it considers appropriate.[7]
   2. The builder's costs submissions seek to address the engagement between the relevant provisions of the SAT Act and s 49(1) of the Building Services (Complaint Resolution and Administration) Act 2011 (WA) (BSCRA Act), which states:

(1) Subject to this section, the Building Commissioner or the State Administrative Tribunal may make such orders for costs as they think fit in relation to proceedings arising from a building service complaint or a HBWC complaint.

1. This engagement between the relevant provisions in relation to the costs of building disputes, and the principles applicable to determining costs, have been considered previously by the Tribunal[8] and were well summarised by Senior Member Aitken of the Tribunal in Deshmukh and Distinctive Building Services Pty Ltd [2024] WASAT 62 (Deshmukh) as follows:
   1. ... Thus, in considering a claim for costs made pursuant to s 49(1) of the BSCRA Act, the Tribunal is not required to start from the position that each party is to bear its own costs. However, as is well understood, costs do not 'follow the event' in Tribunal proceedings and the broad discretion conferred on the Tribunal is to be properly exercised by taking into account relevant considerations.
   2. In Hippydayze (S) at [11] the Tribunal referred to the guidance given to the Tribunal in relation to the exercise of its discretion to award costs by the Court of Appeal in Western Australian Planning Commission v Questdale Holdings Pty Ltd [2016] WASCA 32 (Questdale) in which the following principles were found to apply:

(1) The discretionary power is to be exercised judicially; that is not arbitrarily, capriciously, or so as to frustrate the legislative intent;

(2) The power to award costs is to be exercised if it is fair and reasonable in all the circumstances of the case to do so;

(3) The onus is on the party seeking an order in its favour to establish that a favourable order ought to be made;

(4) Every party to proceedings before the Tribunal is taken to be cognisant of the objectives of the Tribunal as expressly provided for in s 9 of the SAT Act. It is therefore necessary for the applicant to establish that the respondent's conduct has impaired the attainment of the Tribunal's objectives to have the proceedings determined fairly and in accordance with the substantial merits, with as little formality and technicality as possible and in a way which minimises the costs to the parties; and

(5) The mere fact that a party ultimately fails on a contention advanced during the course of the hearing does not, in itself, signify that the party has acted inconsistently with the objectives set out in s 9 of the SAT Act.

1. In Hippydayze (S) at [12] the Tribunal noted that if it exercises its discretion to award costs, it is to approach the task of fixing costs in a broad and relatively robust fashion, referring to the decisions of the Tribunal in Perth Central Holdings Pty Ltd and Doric Constructions Pty Ltd [2008] WASAT 302 at [67] and Marvelle Investments Pty Ltd and Argyle Holdings Pty Ltd [2010] WASAT 125 (S) at [49]. However, although fixing costs involves a relatively broad-brush approach, the Tribunal must nevertheless be satisfied that the costs claimed are reasonable and not excessive in nature.
2. I agree with the view of the Tribunal expressed in both Gileno and Hippydayze (S) that in considering a claim for costs made pursuant to s 49(1) of the BSCRA Act, the Tribunal is not required to start from the position that each party is to bear its own costs, although that does not mean that costs 'follow the event.
3. The broad discretion conferred on the Tribunal under s 49(1) of the BSCRA Act is to be properly exercised by taking into account relevant considerations. The power to award costs is to be exercised if it is fair and reasonable in all the circumstances of the case to do so and the onus is on the party seeking an order for costs in its favour to establish that a favourable order ought to be made.
4. Adopting the principles above in respect of the related proceedings, being building dispute proceedings pursuant to the BSCRA Act, the Tribunal is not required to start from the position that each party is to bear its own costs and is to exercise its discretion as to costs taking into account all relevant considerations.
5. As noted above, the home owners' costs application is founded upon both the 25 June Offer and the builder's conduct in the proceedings.
6. In relation to the impact of a settlement offer on the costs of a proceeding in the Tribunal, s 87(5) of the SAT Act states:

(5) The rules may deal with the effect of certain offers to settle, and responses, if any, to the offer, on the making of an order for the payment by a party of the costs of another party.

1. The State Administrative Tribunal Rules 2004 (WA) (SAT Rules) in turn set out the process by which a party in Tribunal proceedings may make a settlement offer to another party and, where such an offer has been made, r 42 provides as follows:
   1. Order for costs if settlement offer is rejected

(a) a party to a proceeding (other than a proceeding in the Tribunal's review jurisdiction) gives another party to the proceeding an offer in writing to settle the proceeding; and

(b) the other party does not accept the offer within the time the offer is open; and

(d) in the opinion of the Tribunal, the orders made by the Tribunal in the proceeding are not more favourable to the other party than the offer.

(2) If this rule applies, the Tribunal is to, in determining the costs that may be awarded, take into account that the party did not accept an offer more favourable than the Tribunal's order.

(3) In determining whether its orders are or are not more favourable to a party than an offer, the Tribunal -

(a) must take into account any costs it would have ordered on the date the offer was made; and

(b) must disregard any costs it ordered in respect of any period after the date the offer was received.

1. The reasoning behind the SAT Rules in respect of settlement offers, and the manner in which they are applied, was addressed by the Tribunal in Giabeni Pty Limited and the Owners of 30 Coode Street Mount Lawley Strata Plan 11321 [2024] WASAT 105 (S) at [25] to [27] as follows:
   1. The SAT Rules encourage parties to settle their differences without the need for a final hearing before the Tribunal. The is reflected in Clifford and Shire of Busselton [2007] WASAT 89 (S) at [48] (Clifford) as follows:
      1. The SAT Act, therefore, through s 87(5) and the rules referred to, reveals parliamentary support for the idea that, where possible, parties to proceedings should endeavour to consider settlement. This intent is evident elsewhere in the SAT Act. For example, s 9(b) makes it one of the main objectives of the Tribunal to act as speedily and with as little formality and technicality as is practicable, and minimise the cost to parties. Section 52 encourages the use of compulsory conference as an alternative to a final adversarial hearing. Section 54 encourages mediation as an alternative to a final adversarial hearing. Importantly, s 56 expressly deals with settlement and enables the Tribunal to make an order giving effect to a written settlement of the parties. In this statutory context then, the rules providing for the making and acceptance of the settlement offers and for the making of an order for costs in the event that a settlement offer is rejected, or at least settling out factors to be considered in relation to an application for an order for costs in some circumstances, are important.
   2. However, there is no particular format that an offer to settle must be put. This is reflected in Gill & Ors and Wildnight Pty Ltd [2008] WASAT 135 where the Tribunal noted at [40]:
      1. There is no format in the SAT Act with which the settlement offer must comply. There is also no need for the settlement offer to refer to the SAT Rules. The offer must, however, be drafted in a way that, if accepted, an agreement comes into being. It must therefore be specific enough to settle issues in dispute if it is accepted.
   3. In its original jurisdiction, which is the case here, the Tribunal is required to take into account if a party did not accept an offer of settlement made in compliance with r 40 and r 41 of the SAT Rules which is more favourable than the Tribunal's orders: s 87(5) of the SAT Act. However, it does not follow that a costs order will be made. This is because the SAT Rules do not provide that a party who makes an offer more favourable to a party than the result achieved in the Tribunal, is by reason of that, entitled to an order for costs. Rather, as stated by Martin CJ in Questdale at [10], r 42 of the SAT Rules merely provides, perhaps superfluously, that the Tribunal must take such matters into account. This is the same as stated by the Tribunal in the earlier decision of Clifford at [49] to [50].
2. In considering whether a party's refusal to accept an offer made in accordance with the Calderbank principles[9] is unreasonable, the Victorian Court of Appeal in Hazeldene's Chicken Farm Pty Ltd v Victorian WorkCover Authority [No 2] [2005] VSCA 298 (Hazeldene's Chicken Farm) stated at [25] that regard should ordinarily be had to at least the following matters:

(a) the stage of the proceeding at which the offer was received;

(b) the time allowed to the offeree to consider the offer;

(d) the offeree's prospects of success, assessed as 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 an indemnity costs in the event of the offeree's rejecting it.

1. An offer made in accordance with the SAT Rules may or may not, depending upon the circumstances, also constitute an offer made in accordance with the Calderbank principles. However, whether a settlement offer is made pursuant to the SAT Rules, the Calderbank principles or both, the Tribunal has regularly referred to the factors outlined in Hazeldene's Chicken Farm as being matters relevant to the Tribunal's consideration of an application for costs based upon a settlement offer that was not accepted.[10]
2. In relation to the otherwise broad discretion in respect of costs, the Tribunal in McLerie and Koleszko [2014] WASAT 160 (S) stated at [3]:
   1. There are a range of factors that might contribute to the Tribunal making a costs order, including the following nonexhaustive list:

1. where a party conducts itself unreasonably, particularly where the conduct leads to unnecessary costs to the other party; 2. where a party has conducted itself inappropriately, particularly where the conduct leads to unnecessary costs to the other party;

1. where credibility of evidence is at the heart of a matter;

1. where the application undermines the integrity of proceedings under the relevant Act; 2. where the case is weak, being incredible or implausible or obviously unmeritorious; 3. where a party has to embark in proceedings to vindicate its clear contractual entitlement; 4. the circumstances of the case having regard to the above, or other factors, are such that the justice of the case supports moving away from the initial position that each party should bear their own costs; and 5. in the case of proceedings conducted under the Building Services (Complaint Resolution and Administration) Act 2011 (WA) (BSCRA Act), although s 39 [sic 49] thereof broadens the Tribunal's discretion in relation to costs, the provision should not be understood as providing that costs will generally follow the result, it is neutral in effect, and should be applied in the manner which is consistent with and reinforces the objectives and procedures of the Tribunal and any factors will be relevant which point to the justice of the case requiring an award of costs;

as discussed in Pearce & Anor and Germain [2007] WASAT 291 (S) at [22] [24]; Marvelle Investments Pty Ltd and Argyle Holdings Pty Ltd [2010] WASAT 125 (S) and Hoskins and Daniel Vinci t/as D'Vinci Contracting [2011] WASAT 188.

1. I will apply those principles in my consideration of both the applicant's costs application and the respondent's costs application.

1. I must take into account the respondent's settlement offers and consider whether the applicant's refusal to accept those offers was unreasonable, so I will commence my consideration of the costs applications by doing this, having regard to the factors outlined in Hazeldene's Chicken Farm.

Was the applicant's refusal to accept the respondent's November 2023 settlement offer unreasonable?

1. The respondent's November 2023 settlement offer was made very early in the review proceeding. Leave to review the Dismissal Decision was granted on 11 October 2023.
2. The applicant was given 21 days to consider the settlement offer and the terms of the offer were quite clear. However, those terms incorrectly stated that the respondent would apply for a building approval certificate, because it is only the applicant who can make that application.
3. Also, if the City of Cockburn were to require that the constructed patio be removed the offer to refund to the applicant the amount he had paid for the patio would most likely not have put him in the position to pay someone else to construct the patio he had contracted with the respondent to construct, because it is very likely that the cost of constructing the patio would have risen significantly between the date of the Contract (November 2017) and the date of the settlement offer (November 2023).
4. Also, in my view, the applicant's prospects of success as at the date of the settlement offer in his claim against the respondent were not clear.
5. In those circumstances I consider that the applicant's refusal to accept this settlement offer was reasonable.

Was the applicant's refusal to accept the respondent's May 2024 settlement offer unreasonable?

1. The respondent's May 2024 settlement offer was made quite early in the review proceeding.
2. There was no time limit placed on the applicant to consider the offer and the terms of the offer were clear. It proposed a means whereby the applicant could obtain retrospective approval (a building approval certificate) for the constructed patio.
3. However, as at the date of the settlement offer and thereafter the applicant was of the view that the constructed patio did not meet the requirements of the NCC and would not be approved by the City of Cockburn. He obtained a report from his engineer expert witness at the end of July 2024 which concluded that the constructed patio did not comply with the NCC.
4. The question of whether the constructed patio complies with the NCC and whether it is possible for a building approval certificate to be obtained was not resolved until the Review Decision was delivered by the Tribunal.
5. In those circumstances I consider that the applicant's refusal to accept this settlement offer was reasonable.

1. The applicant's submissions are all focussed on the apparent non-acceptance by the applicant of the Review Decision and do not address the principles and factors which are relevant to the determination of a costs application.
2. Also, the documents referred to by the applicant in support of his costs application do not provide details of the work done by the law firm (which he appears to have engaged to provide legal advice, but which did not represent him in either the original proceeding or the review proceeding) or by the applicant's engineer expert witness to justify the significant amounts claimed.
3. However, that is of no consequence because I have decided not to award costs to the applicant for the reasons which follow.
4. In my view neither party's case was implausible nor obviously unmeritorious.
5. The issue of what amount of compensation should be awarded to the applicant consequent upon the respondent's breach of the Contract, by not obtaining a building permit for the constructed patio, was highly contested by the parties and turned on the question of whether it is possible for retrospective approval (a building approval certificate) to be obtained for the constructed patio.
6. Each party had an engineer expert witness, both of whom are highly experienced civil and structural engineers. Each of those engineers had prepared a report and they attended a conferral conference, following which they prepared a joint statement. In the joint statement they agreed on several issues, but they also disagreed on several issues which went to the question of whether the constructed patio complies with the requirements of the NCC.
7. Those expert witnesses gave concurrent oral evidence during the final hearing in the review proceeding which the Tribunal needed to carefully consider and assess following the conclusion of the final hearing.
8. The Tribunal concluded on the evidence presented during the final hearing that the respondent's May 2024 settlement offer satisfies the legislative requirements for retrospective approval and, therefore it is possible for the applicant to obtain retrospective approval for the constructed patio.
9. Consequently, the Tribunal decided that by not taking up that offer, the applicant had not taken all reasonable steps to mitigate his loss consequent upon the breach of the Contract by the respondent and the Tribunal only awarded the respondent the amount which would be payable to lodge the application for a building approval certificate.
10. However, it was not until the Tribunal considered the documentary evidence received during the final hearing and the oral evidence given by the engineer expert witnesses during the final hearing that the Tribunal was able to make that decision.

1. It is very regrettable that the costs incurred by each party which they have sought to recover from the other party ($56,892.16 by the applicant and $28,704.50 by the respondent) far exceed the price paid by the applicant to the respondent for the patio ($11,850.00) and that the parties were not able to resolve the dispute through the mediation conferences conducted by a Tribunal member during the proceeding.
2. Whilst the Tribunal is not required in this proceeding to start from the position that each party is to bear its own costs, taking into account all relevant circumstances, which I have referred to above, I have decided that it is not fair and reasonable to award costs to either party. Therefore, I will dismiss each party's application for costs.

1. The applicant's application for costs filed on 17 July 2025 is dismissed.
2. The respondent's application for costs filed on 17 July 2025 is dismissed.

I certify that the preceding paragraph(s) comprise the reasons for decision of the State Administrative Tribunal.

[1] Constituted by Member Barton and Sessional Member Fraser.

[2] Constituted by Senior Member Aitken.

[3] The respondent had obtained a building permit to construct a patio at the applicant's property prior to carrying out the works, but that building permit was not for the constructed patio.

[4] Constituted by Senior Member Aitken and Senior Sessional Member Affleck.

[5] An application for a building approval certificate is a form BA13, which must be accompanied by a certificate of building compliance, which is a form BA18.

[8] See in particular Hippydayze Pty Ltd and Mener Group Pty Ltd [2019] WASAT 92 (S) (Hippydayze (S)) at [4] to [12] and Gileno and Riviera Homes (WA) Pty Ltd [2018] WASAT 48 (S) (Gileno).

[9] Calderbank v Calderbank (1975) 3 All ER 333.

[10] See for example Cairnes and Ventura Home Group Pty Ltd [2024] WASAT 111 (S) at [15] and McLerie and Koleszko [2014] WASAT 160 (S) at [4].