Brown v The Owners - Strata Plan No. 82527 - [2022] NSWCATAP 328 - NSWCATAP 2022 case summary

Consideration

Following a short adjournment, both parties indicated to the Tribunal that they would consent to the orders being set aside and for the following orders to be made in connection with the original application: By consent: 1. The orders made on 15 July 2022 in application SC 22/19796 are set aside and the application is to be listed for hearing in the Consumer and Commercial Division in the week commencing 21 November 2022. 2. The application is amended to delete the application for a civil penalty and to seek the following orders: a) An order under s 156(1) of the Strata Schemes Management Act 2015 (NSW) (SSMA) that Tania Brown remove 2 of her 3 dogs from her lot and common property. b) That Ms Brown nominates to the Owners Corporation one of her three dogs that is to remain (the remaining dog). c) An order under s 158(2)(b) of the SSMA that Ms Brown take steps to ensure the remaining dog does not continue to create a nuisance or unreasonable interference. 3. On or before 11 October 2022, the Owners Corporation is to provide particulars of the action required for the purpose of an order under s 158(2)(b) of the SSMA. 4. On or before 25 October 2022, the Owners Corporation is to file and serve any further evidence in support of its application. 5. On or before 11 November 2022, Ms Brown is to file and serve any further evidence in reply. 6. On or before 18 November 2022, the Owners Corporation is to file and serve any evidence in response and a short submission, not more than 5 pages, setting out what orders should be made and why. 7. The Tribunal notes: a) Ms Brown may lodge an application under the bylaws with the Owners Corporation to keep more than one dog, such application to be made by 11 October 2022. b) The Owners Corporation will use its best endeavours to determine such application no later than 4 November 2022. 8. In the event the application is made as recorded in paragraph 7 of these orders and is refused, any application by Ms Brown for an order in connection with such refusal must be lodged not later than 11 November 2022 and is to be listed for hearing with these proceedings. 9. The proceedings are listed for hearing in the week commencing 21 November 2022, the Registrar to advise the exact date for hearing in that week. 10. Leave is given to both parties to be legally represented. 11. Liberty to apply. 12. Reasons: The Tribunal will provide reasons in due course.
In light of the jurisdictional and procedural issues which we raised, we considered that it was appropriate to make orders in the above terms. These are the reasons for that decision.
As will be apparent from cl 9(1)(a), the Tribunal can set aside orders by consent.
However, as that clause makes clear, there is a discretion which the Tribunal has to exercise. That discretion requires the Tribunal to consider whether it is appropriate to set aside orders in the circumstances of the case.
For example, where proceedings have been finally heard and determined the Tribunal would not usually set aside orders by consent where the only reason offered by the parties is that they would like to start again and have another hearing or that they are both dissatisfied with the decision. In such a case neither the guiding principle nor a consideration of the cost to the parties and the Tribunal and the requirement to consider proportionality found in s 36 of the NCAT Act would support such an approach.
However, if there was an error which required correction and the parties recognised such an error which vitiated any decision made and warranted it being set aside and a new hearing ordered, the proper exercise of discretion may make it appropriate to set aside the erroneous decision by consent rather than require the parties to expend costs in prosecuting an appeal or taking proceedings in a court to achieve the same result. Such an approach is wholly consistent with the requirements of s 36 of the NCAT Act.
In the present case, the consent orders that we made permits the Tribunal to address the problems arising from the form of the proceedings and the decision that has been made by setting aside that decision and relisting the proceedings to determine the application in the agreed amended form.
In this regard, we are satisfied that it is inappropriate for the Tribunal in the Consumer and Commercial Division to determine an application for general orders under the SSMA and an application for the imposition of a civil penalty under the SSMA in the same proceedings or at the same time. Further, the combination of such claims in one application is impermissible and an irregularity of a type contemplated by s 53(3) and (4) of the NCAT Act.
There are a number of reasons why we hold this view.
First, as stated in s 38 of the NCAT, the Tribunal "is to act with as little formality as the circumstances of the case permit and according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms". However, in the case of a mixed application seeking general orders and the imposition of a penalty under the SSMA, while both fall within the definition of "general jurisdiction" of the Tribunal found in s 29, different procedural rules apply to the Tribunal in determining such applications.
In proceedings for general orders under the SSMA, the Tribunal is not bound by the rules of evidence and may enquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of natural justice: s 38(2). In contrast, proceedings for the imposition by the Tribunal of a civil penalty in the exercise of its general jurisdiction require that the Tribunal must observe the rules of evidence: s 38(3) NCAT Act. In our view these different requirements indicate the Legislature intended separate proceedings for general orders and proceedings for the imposition of a civil penalty.
This view is supported by the fact that civil penalty proceedings under the SSMA are similar in nature to the Tribunal exercising its enforcement jurisdiction under s 33(1)(b) of the NCAT Act.
Secondly, in all proceedings, whether for a general order under the SSMA or the imposition of a civil penalty under that Act, the rules of natural justice apply. In National Companies & Securities Commission v News Corporation Ltd (1984) 156 CLR 296; [1984] HCA 29, Gibbs CJ said at 512 (Brennan J agreeing: 15. In Russell v. The Duke of Norfolk (1949) 1 All ER 109 Tucker L.J. said, at p 118: "The requirements of natural justice must depend on the circumstances of the case, the nature of the inquiry, the rules under which the tribunal is acting, the subject-matter that is being dealt with, and so forth." The passage has frequently been approved - for example, by this Court in Reg. v. Commonwealth Conciliation and Arbitration Commission; Ex parte Angliss Group (1969) 122 CLR 546, at p 552. The authorities show that natural justice does not require the inflexible application of a fixed body of rules; it requires fairness in all the circumstances, which include the nature of the jurisdiction or power exercised and the statutory provisions governing its exercise. Moreover, as Stephen J. said in Salemi v. MacKellar (No. 2) [1977] HCA 26; (1977) 137 CLR 396, at p 444, the rules of natural justice "may also vary from case to case although each be conducted before one and the same tribunal or person."
It seems to us that natural justice cannot be afforded in mixed proceedings of this type where evidence may be received for the purpose of general orders under an enquiry permitted by s 38(2) whereas the Tribunal must apply the rules of evidence in civil penalty proceedings. This is because of the different nature of the inquiry and different rules under which the Tribunal is acting in each type of claim.
Further, because: 1. a party may be entitled to claim civil penalty privilege in connection with proceedings for the imposition of a civil penalty; and 2. the manner in which civil proceeding should properly be conducted is different (it usually being appropriate to conduct a hearing on contravention then deal with the aspect of penalty), it is self-evident that a respondent would be placed at a significant disadvantage both in terms of knowing what evidence was relied upon for what purpose and what might constitute evidence to which the respondent was required to respond in connection with the different types of application. Consequently, combining such applications and hearing them at the same time is inherently unfair and/or likely to lead any decision-maker into error.
Thirdly, as indicated above, there are different appeal paths depending on the nature of the proceedings. General orders may be challenged by way of internal appeal. A decision to impose a civil penalty is appealable to the relevant court. The Legislature could not have intended that a respondent who was subject to general orders and the imposition of a civil penalty in the same proceedings would be required to lodge two appeals to different bodies. Further, the Legislature could not have intended that the different appeal bodies could make determinations about the same factual matters relevant to the making of general orders and the imposition of a civil penalty. Rather, giving effect to the guiding principle in interpreting the provisions of the NCAT Act and procedural rules (as required by s 36(2)(b) of the NCAT Act) and having regard to the objects found in s 3 and the distinctions drawn between different types of proceedings in the Tribunal when exercising different jurisdiction, in our view the combination of applications for general orders and the imposition of a civil penalty under the SSMA in one proceeding is not permitted.
Since commencement of proceedings before the Tribunal and the form by which an application is made are matters of practice and procedure, the combination of applications for general orders and for imposition of a civil penalty constitutes an irregularity in the commencement or continuation of proceedings: Harkness v Bell's Asbestos and Engineering Ltd [1967] 2 QB 729 per Lord Denning MR at 735- 6; [1996] 3 All ER 843.
In addition, there is: 1. for the reasons set out about, with such combined applications (as illustrated by the present case), a failure to afford procedural fairness; and 2. in the present case, a failure to exercise jurisdiction in connection with the imposition of a civil penalty because it does not appear the Tribunal examined the facts and made relevant determinations by reaching a level of satisfaction as required by the CFMEU Case.
In Minister for Immigration & Multicultural Affairs v Bhardwaj 209 CLR 597; [2002] HCA 11, at [52]-[53] (citations omitted) Gaudron and Gummow JJ (McHugh J agreeing) said of such errors: 52 The view that a decision involving jurisdictional error does not prevent the decision-maker from correcting that error by making a later decision has been accepted by the Supreme Court of Canada. Thus, in Chandler v Alberta Association of Architects, Sopinka J, with whom Dickson CJ and Wilson J concurred, said: "As a general rule, once [an administrative] tribunal has reached a final decision in respect to the matter that is before it in accordance with its enabling statute, that decision cannot be revisited because the tribunal has changed its mind, made an error within jurisdiction or because there has been a change of circumstances ... To this extent, the principle of functus officio applies. It is based, however, on the policy ground which favours finality of proceedings rather than the rule which was developed with respect to formal judgments of a court whose decision was subject to a full appeal. For this reason, I am of the opinion that its application must be more flexible and less formalistic in respect to the decisions of administrative tribunals which are subject to appeal only on a point of law." In the same case, his Lordship cited with approval a statement by McLachlin J that: "as a matter of logic and on the authorities ... a tribunal which makes a decision in the purported exercise of its power which is a nullity, may thereafter enter upon a proper hearing and render a valid decision". 53 In our view, logic and legal principle both direct the conclusion that the approach of the Supreme Court of Canada is correct. As already pointed out, a decision involving jurisdictional error has no legal foundation and is properly to be regarded, in law, as no decision at all. Once that is accepted, it follows that, if the duty of the decision-maker is to make a decision with respect to a person's rights but, because of jurisdictional error, he or she proceeds to make what is, in law, no decision at all, then, in law, the duty to make a decision remains unperformed. Thus, not only is there no legal impediment under the general law to a decision-maker making such a decision but, as a matter of strict legal principle, he or she is required to do so. And that is so, regardless of s 33(1) of the Acts Interpretation Act.
Consistent with the statement of Basten JA in Atkinson, referring to Bhardwaj, the Tribunal may also set aside a decision for such errors.
Consequently, there is a power to set aside the July orders under s 53(4) of the NCAT Act.
It follows, subject to one matter, that we are satisfied it was appropriate to set aside the July orders by consent.
That matter concerns whether, when constituted as the Appeal Panel, we can set aside all the orders by consent under cl 9 of the Regulation (or s 54(4) of the NCAT Act if there was no consent). This is because we do not have jurisdiction to deal with the appeal in respect of the imposition of a civil penalty. However, we do have internal appeal jurisdiction to deal with the appeal concerning the general order for removal of the dogs.
Under s 81(2) of the NCAT Act we are able to exercise all the functions conferred under the NCAT Act or other legislation on the Tribunal at first instance. That includes the power to set aside decisions permitted by cl 9 of the Regulation or set aside orders for procedural irregularities under s 53(4).
Since we are not determining the appeal against the penalty but, rather, dealing with the procedural irregularity in the original proceedings in the context of the application for general orders, we are satisfied we have jurisdiction to make these orders.
If we are wrong on this aspect of our reasons, since the presiding Member is the Deputy President and Head of the Consumer and Commercial Division with authority to constitute the Tribunal at first instance, he would (consistent with the guiding principle), if necessary, constitute us as the Tribunal at first instance to make the consent orders.
For these reasons we have made the consent orders on, 4 October 2022.

Brown v The Owners - Strata Plan No. 82527

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