Casuscelli v Community Association DP 270482; Shonroo Pty Ltd v Community Association DP 270482

NCAT Appeal Panel|2019-09-30|Before: Community Association DP

REASONS FOR DECISION

In Shonroo Pty Ltd v Community Association DP 270482 and Casuscelli v Community Association DP 270482 and Shonroo Pty Ltd [2019] NSWCATAP 168 we dealt with appeals brought by two lot holders in the respondent Community Association from decisions made by that Association in General Meetings to make changes to certain bylaws.
The proceedings had come before us on the basis that the appellants alleged that a number of those bylaws were invalid. The appeals were brought from a determination which had been made by a Member of this Tribunal. As will be seen from a detailed reading of our earlier decision, the appellants and the respondent agreed that the subject matter of the earlier determination by the Member was no longer an issue before them, but there were other matters which had not previously been ventilated before the Tribunal which they wished us to determine.
For reasons set out in our earlier decision we proceeded to deal with the new matters raised before us and we determined that certain bylaws which had purported to have been made by the respondent were invalid and should be revoked.
At the conclusion of our reasons for decision we made the following orders: We order that: (1) Appeal allowed (2) the decision of the Member in SCS 18/09453 is set aside. (3) so much of the amendments made at the Annual General Meeting of Community Association DP 270482 held on 7 October, 2017 which purport to amend any provision of Part 4 of the By-Laws of the Association and which purport to amend Part 5 of the Management Statement are revoked, with effect from 7 October, 2017. (4) the parties are directed within 28 days to bring in short orders of minutes, reflecting order (3) above (5) costs reserved with liberty to apply to be exercised within 28 days.
We have now received costs submissions from the parties and correspondence from the respondent with respect to the short minutes of order that we had anticipated receiving. We now proceed to deal with each of these outstanding matters.

Final form of orders

Following the publication of our decision the parties engaged in correspondence between themselves and with the Registry concerning the final form of orders, and whether any consequential amendments to the by-laws should rectify other deficiencies in the state of the by-laws which the appellants alleged also existed. The Registry indicated on our behalf that we were only prepared to confine the orders made by us to the immediate consequences of the matters which we had considered during the course of the hearing.
Solicitors for the respondent have now produced a form of bylaws which they assert reflects the orders which we made and especially order (3) set out above. We do not apprehend that the appellants have made any objection to the form of bylaws produced by these solicitors. In these circumstances it is sufficient that we note that the version of the Community Management Statement of the respondent Association attached to email communication from Mr Warwick Van Ede solicitor to this Tribunal dated 30 September, 2019 reflects the orders made by us and satisfies the obligations of the parties to produce short minutes of order.

Costs

There is no automatic entitlement to a costs order in these proceedings. The respondent submitted that no entitlement arose under the relevant legislative provisions and did not seek an order for costs. The appellants did seek a costs order in their favour which was resisted by the respondent.
Whether costs are awarded is governed by the provisions of section 60 of the Civil and Administrative Tribunal Act 2013 which are in the following terms: 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.
Whether the circumstances of the proceedings may be characterised as "special" for the purpose of section 60 so as to warrant a costs order is a matter of impression and evaluation guided by the several matters set out in section 60 (3). Those matters are not exclusive, and it is not necessary that all of them be considered.
The circumstances of these appeal proceedings are that the matters which were initially argued before the Member were no longer in contention when the proceedings came before us. We were, in effect, asked to consider the proceedings anew by reference to different matters. In determining the proceedings we concluded that there were fundamental defects which pertained to the purported attempts to amend the by-laws because no Council approval had ever been sought and obtained. Furthermore, the bases for the amendments were misconceived. These arguments had always been advanced by the appellants, especially as they applied to the failure to obtain Council approval.
The existence of those arguments provides a compelling argument that the position taken by the respondent lacked a tenable basis. Of course, it is usual for the parties to proceedings before this Tribunal to take differing positions, and these circumstances alone would not create anything which would be regarded as "special." However, non-"special" circumstances of this kind will usually be reflected in the existence of an arguable case. Here, the fundamental failure to obtain Council consent, which was clearly a responsibility of the respondent in each case, created a situation where it had, in reality, no tenable basis to resist the ultimate position taken by the appellants. To this limited extent we are of the opinion that the circumstances constitute "special" circumstances for the purpose of considering the costs application
We therefore conclude that the appellants are entitled to a costs order in their favour.
However, the extent of those costs must be restricted to ensure that they do not include the costs associated with the appeal as originally formulated which was abandoned before us at the commencement of the hearing. In other words, the costs of the appeal should be restricted to the costs incurred by the appellants with respect to the newly raised matters considered by us at the hearing of the appeal.
The appellants set out details of their costs in a memorandum from Shonroo Pty Ltd dated 30 September 2019. Included in those costs was a reference to counsel's fees paid by Shonroo Pty Ltd totalling $8,700. Included in that amount were fees for attending the hearing before us on 6 June 2019 but also fees for attending an earlier hearing on 13 March 2019. Those fees also included initial instructions and perusing initial files, preparation for a hearing on the two dates indicated and drafting submissions There is also claimed disbursements for printing documents, transcript (presumably of the earlier hearing) and cost of filing the appeal totalling $3,153. Mr Abduraham has claimed "costs" unspecified of $864.
That memorandum also refers to disbursements paid by Mr Casuscelli with respect to appeal books of $255 and for his own "costs" unspecified of $660.
Because of the restriction on the subject matter of the costs which we intend applying as set out above and doing the best we can to deal with the nature and extent of the costs submitted by the respondents, we conclude that we should allow counsel's fees in the sum of $2500 only. In the same way, although some of the material produced for the appeal hearing before us was no longer relevant, some of it was. We intend allowing each of Shonroo Pty Ltd and Mr Csuscelli the sum of $200 towards the cost of appeal books. There is no demonstrated basis to support the other "costs" claimed which appear to be personal to both individuals. Indeed, in most cases the costs expended by persons in terms of the expenditure of their time for the preparation of a hearing are not usually recoverable as legal costs in proceedings. Accordingly, we intend to reject these items.
In all the circumstances we award costs in favour of Shonroo Pty Ltd in the sum of $2,700, and in favour of Charles Casuscelli in the sum of $200, in each case payable by the respondent.

Orders

We make the following orders; 1. The version of the Community Management Statement of the respondent Association attached to email communication from Mr Warwick Van Ede solicitor to this Tribunal dated 30 September, 2019 reflects the orders made by us and satisfies the obligations of the parties to produce short minutes of order. 2. The respondent is to pay the costs of the appellant Shonroo Pty Ltd in the sum of $2,700 and of Charles Casuscelli in the sum of $200.

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 November 2019

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Judgment (5 paragraphs)

Cases Cited (1)