Ceepee Pty Ltd v Roads and Maritime Services

The Applicant's submissions

1. In his submissions on behalf of the Applicant Mr Doyle submitted that the starting point for consideration of the appropriate costs order is the fact that the Applicant has been comprehensively successful in its appeal against the Respondent's decision and the Respondent's position has been judged to be unsustainable. It should have its costs.
2. Mr Doyle identified a number of matters which he submits warrant an award of costs in the Applicant's favour. He contends that the reasonableness of the Respondent's approach to the litigation should be considered with regard to the fact that the matter concerns a very small business which proposed to operate private hire cars limited to 8 licences in a Regional centre of NSW and the Respondent's concern was in relation to the financial viability of that business. Mr Doyle submitted that, given those factors, and the legislative objective of an informal, quick, just and cheap resolution of the case, the Respondent must have been obliged to assist the Tribunal in keeping the cost and complexity of the litigation to a minimum. He further submitted that the Respondent failed in meeting that obligation.
3. Mr Doyle points to the interlocutory steps of the proceedings before the Tribunal's President in which the solicitor for the Respondent raised the concern about the paucity of information the Applicant had provided. The President stressed that if the Respondent required extra information, it needed to give the Applicant a clear indication of what was required.
4. Mr Doyle submitted that the Respondent did not adhere to either the wording or the spirit of the President's directions. Instead, the Respondent's conduct of the litigation resulted in a protracted complex exchange of argument over new matters unrelated to the particularised case initially raised by the Respondent. He submitted that the delay resulted in lost revenue to the business. It also resulted in bailee drivers being left with no work from the business during that time and the potential for damage to the commercial reputation of the Applicant.
5. The Applicant also relies on the Respondent's failure to meet its obligation to act as a "model litigant" in its conduct of the proceedings. Mr Doyle points to comments that I made in that regard from paragraph [79] the decision. In particular he referred to the following comments: 93. In light of the President's encouragement as set out above, it is difficult to understand how the Respondent's inaction regarding a conclave of the financial advisors could be said to be in accordance with the Model Litigant Policy. As a model litigant the Respondent has the obligation to endeavour to avoid litigation. 94. Similarly, it is apparent that the Applicant's offer to meet any reasonable assets or security requirement of the Respondent could have been the subject of discussions between the parties. In my view such discussions had the potential to narrow the issues and may have avoided many of the costs incurred in this matter. 95. I agree with the Applicant that it was incumbent upon the Respondent to identify the concerns it had about the Applicant's financial viability; if it required further information to advise the Applicant what that information was and allow the Applicant a chance to provide it. It was also incumbent upon the Respondent to identify any other concerns it had regarding the Applicant and allow the Applicant a chance to address those concerns. Its failure to do so placed the Applicant at a disadvantage in the conduct of the proceedings and does not meet the obligation placed a model litigant to act honestly and fairly in handling litigation. 96. In my view, the Respondent's conduct of these proceedings has not met the obligation imposed on it as a model litigant.
6. Mr Doyle submitted that these failings must lead to a costs order against the Respondent. In support of that submission he relies on comments by Basten JA in AT v Commissioner of Police NSW at paragraph [32]: 32 … A further factor to be taken into account is that the respondent, being a State agency, was also required to act as a model litigant: Mahenthirarasa v State Rail Authority of NSW (No 2) [2008] NSWCA 201; 72 NSWLR 273 (Basten JA, Giles and Bell JJA agreeing). ...
7. Mr Doyle also referred to Mahenthirarasa v. State Rail Authority of NSW (No 2) [2008] NSWCA 201 at paragraphs [16] - [20]). 16 In this State, the relevant principles as to the proper role of the executive government were succinctly stated by Mahoney J in P & C Cantarella Pty Ltd v Egg Marketing Board (NSW) [1973] 2 NSWLR 366 at 383 in the following terms: "The duty of the executive branch of government is to ascertain the law and obey it. If there is any difficulty in ascertaining what the law is, as applicable to the particular case, it is open to the executive to approach the court, or afford the citizen the opportunity of approaching the court, to clarify the matter. Where the matter is before the court it is the duty of the executive to assist the court to arrive at the proper and just result." 17 As his Honour noted, that principle was not novel, but was to be derived from long-standing authority applied to the Crown in the United Kingdom and reflected in this country in the remarks of Griffiths CJ in The Melbourne Steamship Company Ltd v Moorehead [1912] HCA 69; 15 CLR 333 at 342. In more recent years, the obligation of the government has been described as an expectation that it will act and be seen to act as a "model litigant": see Yong v Minister for Immigration and Multicultural Affairs (1997) 75 FCR 155 at 166E (Beaumont, Burchett and Goldberg JJ). 18 In Scott v Handley [1999] FCA 404; 58 ALD 373, the Full Court of the Federal Court (Spender, Finn and Weinberg JJ) considered the appropriateness of a refusal to grant an adjournment to litigants in person who claimed they were not ready to proceed to a final hearing, in circumstances where the respondent Minister had served affidavits with new material only six days before the hearing and three months outside the time permitted at a directions hearing: at [39]. One factor considered relevant by the Full Court was that the appellants were unrepresented litigants. The second factor was that the active respondent was an officer of the Commonwealth. Their Honours continued at [43]: "As such he properly is to be expected to adhere to those standards of fair dealing in the conduct of litigation that courts in this country have come to expect - and where there has been a lapse therefrom, to exact - from the Commonwealth and from its officers and agencies." 19 After referring to Moorehead and Cantarella, their Honours noted that the principles were stated at a level of broad generalisation, and that "the burden of this fair dealing standard is best appreciated in its particular exemplifications in individual cases": at [45]. They continued: "[46] In the present instance the second respondent (i) was in a position of obvious advantage in relation to unrepresented litigants; (ii) was significantly in default in complying with procedures designed to secure the fair and orderly preparation of the matter for hearing; (iii) served the affidavits on the appellants at an extremely late date with a consequential likely impairment of their capacity to prepare properly for a final hearing; (iv) did not inform his Honour of the default and of its possible consequences; and (v) took advantage of the inability of the appellants to articulate properly the basis for, and to secure, an adjournment. In our view the conclusion is inescapable that the second respondent has fallen considerably short of the standard properly to be expected of the Commonwealth. ... [48] During the course of the present hearing counsel for the second respondent acknowledged that had Mrs Scott's submission in this court been put to his Honour, he would have been hard put to resist an adjournment. That concession was properly made. We agree. The second respondent ought to have informed the trial judge of the default. Had this been done, his Honour would have had a different appreciation of the time the appellants had available to them to prepare for the hearing." 20 These principles have for some years been recognised by express statements of the executive government. At the Commonwealth they are to be found in Legal Service Directions issued by the Attorney-General issued under s 55ZF of the Judiciary Act 1903 (Cth). Similar principles were promulgated by the Government in this State in 2004. As explained by Mahoney JA in Logue v Shoalhaven Shire Council [1979] 1 NSWLR 537, the principles apply to a statutory corporation. Although in dissent as to the outcome, his Honour considered the approach adopted by the respondent Council in seeking to uphold a compulsory sale of property to recover unpaid rates, pursuant to a defective notice. His Honour noted that, "the council is a corporation constituted by statute, and discharging public functions": at 558F. He continued at 558-559: "It is well settled that there is expected of the Crown the highest standards in dealing with its subjects: see Melbourne Steamship Co Ltd v Moorehead ..., per Griffiths CJ. What might be expected from others would not been seen as in full accord with the principles of equity and good conscience to be expected in the case of the Crown: see P & C Cantarella .... In my opinion, a standard of conduct not significantly different should be expected of a statutory corporation of the present kind."
8. The Applicant also relies on a number of the specific grounds provided for by section 88(1A) of the ADT Act, while conceding that these overlap to some extents with the matters already discussed.

Section 88(1A)(a) - the Respondent conducted the proceedings "in a way that unnecessarily disadvantaged the Applicant"

1. Mr Doyle submitted that the Respondent rejected numerous invitations from the Applicant to nominate its reasonable requirements in relation to viability so the Applicant could meet them in advance of the hearing. He further submits that the Respondent did so despite the President's clear direction that it file and serve particulars of its reasons for contesting the application. Mr Doyle noted that Mr Gunton, the Respondent's financial expert witness, conceded under cross examination that limiting the number of licences will not increase viability. That limitation could in fact curtail viability.
2. Mr Doyle further submitted that the Respondent failed to make available its financial expert for conferral with the expert of the Applicant with a view to reaching agreement where possible with a view to identifying and narrowing the issues in the proceedings. This was despite the comments and encouragement from the President at the time when the matter was listed for hearing, and despite several requests from the Applicant.

Section 88(1A)(b)) - The Respondent "prolonged unreasonably the time taken to complete the proceedings"

1. Mr Doyle submitted that the Respondent failed to make its financial expert available to reduce the issues in the proceedings despite the comments and encouragement from the President.
2. Mr Doyle further submitted that the Respondent did not comply with the President's direction that it particularise its arguments. Rather, it chose to raise many arguments at the hearing that had never been particularised, causing unnecessary argument and avoidable complications in the litigation. It moved the Tribunal to permit it to tender all of the evidence and transcripts from the proceedings determined by Ceepee Pty Ltd v Roads and Maritime Services [2014] NSWCATAD 74 (the "cancellation matter"), when that evidence had little relevance to assessing the Applicant's financial viability. Mr Doyle asserted that the Respondent did so under the threat that if the Applicant did not agree it would seek to recall the witnesses from the cancellation matter to re-examine them - presumably over at least two more hearing days.
3. Mr Doyle further submitted that the Respondent raised a series of new, wide ranging allegations in its written submissions directed against the Applicant, the Applicant's directors and its related entities, which served no purpose but to distract wastefully from the real issues before the Tribunal.

Section 88(1A)(c)) - The Respondent's two principal arguments were relatively weak and could have little prospect of success

1. Mr Doyle submitted that the claim that the Applicant was not financially viable to operate 8 licences could have had little prospect of success where: 1. prior to the hearing the Applicant had offered to post security in a sum reasonably nominated by the Respondent to guarantee against any reasonable concern in regard to the Applicant's financial viability; 2. the Applicant had openly disclosed that it was "staked" by the owners of the largest taxi/hire car operator in regional NSW; 3. the Respondent did not present any evidence or argument as to how restricting the Applicant's business to the operation of 3 licences, instead of the 8 licences for which it had applied, would increase its financial viability; and 4. the Respondent had rejected numerous invitations from the Applicant to nominate its reasonable requirements in relation to viability so the Applicant could meet those requirements.
2. Mr Doyle further submitted that the Respondent's claim that the Applicant had failed to provide necessary information sought by the Respondent could have little tenable basis, given that the Respondent's only witness had advised the Applicant in writing and conceded in the witness box that he did not require further information.

Section 88(1A)(e)) - other relevant matter

1. Mr Doyle submitted that the Respondent's conduct of the proceedings, as referred to above, made the proceedings unnecessarily complex, making what could have been a simple investigation into the financial viability of the Applicant into a complex, time consuming investigation of wide ranging accusations.
2. In relation to the Respondent's assertion that the Applicant had withheld information, Mr Doyle set out a schedule showing the history of the Applicant's offers to provide the Respondent with any information it wanted to see and to have its accountant meet with the Respondent's financial expert to resolve any issues of concern. Mr Doyle submitted that the Respondent did not respond to those offers. He also noted however, that the Respondent did conduct a surprise audit of the Applicant's business revealing no breaches.
3. Mr Doyle pointed to the obligations imposed on the Respondent as a Model Litigant and submitted that it is hard to reconcile those obligations with the Respondent's approach in this matters and also with the object of "fostering an atmosphere in which administrative review is viewed positively as a means of enhancing the delivery of services and programs" as stated at section 3(f) of the ADT Act.
4. He contends that the Respondent's ultimately doomed attempts to complicate the proceedings are not consistent with the Respondent adhering to its role in the litigation, having regards to the objects of the ADT Act, which is the reason it is fair that it should pay the Applicant's costs.
5. As noted, the Applicant seeks an order that the Respondent pay its costs on an indemnity basis. Like all costs orders, the purpose of an award of indemnity costs is compensatory and not punitive: Hamod v State of NSW (2002) 188 ALR 659.
6. Mr Doyle submitted that the power to award costs on a basis other than party/party costs is not constrained by the wording of section 88(2)(b) of the ADT Act, and the Tribunal enjoys a wide discretion.
7. He points to the decision in Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225 at 233-234 which held that the making of such an order requires a "sufficient or unusual feature" and Oshlack v Richmond River Council (1998) 193 CLR 72 which held that some "relevant delinquency" is required. He submitted that that does not mean that the Tribunal must necessarily construe some moral delinquency, or some ethical shortcoming, but there must be some "delinquency" relating to the conduct of the case: Ingot Capital Investment v Macquarie Equity Capital Markets Ltd (No 7) (2008) 65 ACSR 324 at [24]; Liverpool City Council v Estephan [2009] NSWCA 161 at [95].
8. Mr Doyle submitted that the Tribunal has already accepted the Applicant's arguments that the Respondent has not met its obligations as model litigant and that the Respondent's failure to meet the President's expectation of expert witness conferral substantially prolonged the hearing despite the Applicant's repeated calls. Indeed the hearing could have been avoided all together.
9. In reply to the Respondent's submissions on the issue of costs Mr Doyle submitted that the submissions include an inappropriate attempt to re-agitate matters which have already been determined. He nevertheless answered the issues raised and denied any impropriety whatsoever on the part of the Applicant or its directors.
10. He submitted that the Respondent's contention that a conclave would not have assisted resolution of the proceedings because it would not have resolved the Respondent's concerns about Mr Williamson's involvement, fails to come to grips with the real complaints made against the Applicant and the nature of the criticisms in the decision. He submitted that the Respondent's complaint was ultimately that the Applicant had not provided adequate and accurate information and that it is simply untenable for the Respondent to make that complaint while at the same time ignoring the repeated invitations of the Applicant for it to engage in frank and open dialogue about any issue of concern. He submitted that the failure to participate in a conclave was just one particularly glaring example of that failure.

The Respondent's submissions

1. In his submissions on behalf of the Respondent Mr Wozniak provided an outline of the Respondent's concerns in relation to the initial application. In essence these related to the Respondent's understanding that the Applicant's business was a start-up business rather than that the Applicant was acquiring a going concern with existing custom.
2. It became a concern to the Respondent that the Applicant may have been a vehicle for Bretabac Pty Ltd to, in effect, continue its business through the Applicant. Bretabac could no longer operate its Port Macquarie business because it had agreed to the cancellation of its licences from 28 February 2013. The Applicant had acquired its business from Bretabac. The Respondent was concerned that the Applicant's financial viability appeared to be wholly dependent upon Bretabac and/or Mr Williamson and that the Applicant could not stand alone without the financial backing of Bretabac and/or Mr Williamson.
3. In relation to the Applicant's contention that the scope of the enquiry extended beyond what was contained in the Statement of Reasons, Mr Wozniak submitted that Senior Member Molony had indicated that the Tribunal was to make a fresh decision based on all of the evidence presented and was not bound by the Statement of Reasons.
4. In relation to the criticism that the Respondent did not engage in a 'conclave' in which the two financial experts would meet to discuss the matter, Mr Wozniak submitted that the Respondent took the view that any such conclave could not result in a resolution of the concerns that it had that Bretabac was in fact the guiding hand behind the Applicant's business, as any discussions between any experts could be purely on the mathematical basis of the figures that were provided. The Applicant's evidence as to how the business was established and how it operates was crucial and could only be explored by cross examination of the various witnesses in relation to the matter. Further, the report of the Applicant's expert was only provided days prior to the hearing. This reduced substantially the amount of time involved in relation to any possible discussions.
5. Mr Wozniak submitted that the fact that the Applicant's business is a 'small business' has no bearing on how litigation should have been conducted as all operators are treated equally, whether large or small. He further submitted that the evidence showed that the Applicant was a new operator to the market and its two directors had no relevant experience as operators in private hire vehicle services. They have had experience as paid employees but not as operators or owners of the business. They resided in Victoria at the time had not been to Port Macquarie where the business was located. They relied on a designated manager, who had no control or authority over the financial affairs of the Applicant, to operate its business. The Respondent's concerns were that Bretabac and/or Mr Williamson were in fact the true operators of the business.
6. In his submissions Mr Wozniak reiterated the reasons for the Respondent's concerns. He said that, ultimately, the Tribunal was asked to accept that the Applicant is financially viable because it has the backing of Bretabac or Mr Williamson to provide working capital and continue to provide key services relevant to the business, including premises, administrative staff and a call centre on non-commercial terms.
7. Mr Wozniak noted the view that I expressed at paragraph 26 of the decision that "I do not consider that Mr Williamson's support of the Applicant's business is of concern in these proceedings". He submitted that whilst this is at odds with the approach taken by the Respondent, and while I was entitled to make a decision based on the matters I considered relevant, the Respondent was entitled to conduct a hearing on the basis of the matters that it considered relevant. As noted above, one of those matters was Mr Williamson's involvement and support in the conduct of the Applicant's business.
8. In relation to the Applicant's contention that it offered security to address the Respondent's concerns as to the Applicant's financial viability, Mr Wozniak submitted that this would not have resolved those concerns because it was probable that the security would have come from either Bretabac or Mr Williamson.
9. Mr Wozniak also submitted that while the Tribunal disagreed with Mr Gunton's assessments in relation to the profitability of the business, the Respondent was entitled to take his opinion into account in relation to the conduct of the matter. He also referred to the fact that there was no evidence to permit it to test the instructions provided to Ms Lindsay in relation to the figures.
10. In relation to the question of whether an order for costs should be made Mr Wozniak referred to my decision in Dee Why Grand Shopping Centre Pty Ltd v Kriletich [ 2012] NSWADT 26 in which I quoted from the decision of Deputy President Chesterman in Profilio v Coogee Bay Village Pty Ltd (No. 4) [2011] NSWADT 64. In that matter the Deputy President stated: 40. Paragraph (c) of Section 88(1A). It is clear that a successful party cannot claim costs under paragraph (c) simply by pointing to the fact that it succeeded. Equally, it is clear that the scope of the paragraph is not confined merely to proceedings where the case advanced by the unsuccessful party had 'no tenable basis in fact or law'. What the paragraph requires is that the Tribunal, in determining whether it is 'fair' to award costs to the successful party, should assess 'the relative strengths' of the claims made by each of the parties.
11. In Profilio the Deputy President cited with approval two decisions of the Victorian Civil and Administrative Tribunal in regard to section 109 of the Victorian Civil and Administrative Tribunal Act 1998 which is an equivalent provision to section 88 of the ADT Act. He stated: "42. In the first of these decisions, Dennis Corporation Pty Ltd v Casey CC (Red Dot) [2008] VCAT 691, the Victorian Tribunal said at [14 - 19]:- 14 The relative strengths of the claims appear to refer to the strength of claims of one party compared to the strength of the claims of another. A difficult, doubtful or test case might be necessary to clarify the legal position of the parties. It is probably seldom that an order for costs would be made having regard to this consideration alone where there was a real issue to be tried and real justification for the claims made on either side. I take it that it is generally where there is a very weak case for one side, or none at all, that this consideration is likely to lead to an order for costs. I note that the wording says that the absence of a "tenable basis in law or fact" is a consideration included within the consideration of the relative strengths of the claims of the parties. 15 This certainly cannot mean that an unsuccessful party should be required to pay costs because, at the end of the case, that party's claims have been found to be untenable in fact or law to the extent that they were not upheld and were not successful. That would amount to "costs following the event". It would compromise the general rule created in s 109(1). 16 As I have said, I do not think that the consideration indicates an order for costs where there are strong cases on either side, or perhaps evenly balanced cases on either side. 17 I am not minded to go so far as to say that a weak case will necessarily indicate an order for costs. The word "untenable" is stronger than "weak". The Macquarie Dictionary, second revision, defines untenable as incapable of being held against attack, incapable of being maintained against argument, as an opinion, scheme etc. … 43. In the second of these decisions, Winky Pop Pty Ltd v Hobsons Bay CC [2008] VCAT 1512, the Tribunal said at [7]:- 7 Although the applicant was ultimately unsuccessful in its application, I do not believe that its case was so weak as to be untenable in fact or law. I endorse the comments of Senior Member Byard in Dennis in relation to this issue. I agree with the applicant that, although I indicated in my reasons that the applicant's case in relation to its access to material was "disingenuous" to a panel process that it well understood, I certainly did not consider the applicant's case to be completely unarguable, unreasonable or untenable in a manner that would clearly justify an award of costs having regard to the relative strengths of the arguments put by each party. This was simply a case where both parties raised and carefully articulated a number of matters of fact and law before the Tribunal, and the applicant was ultimately unsuccessful in persuading the Tribunal to support its view."
12. In the present matter Mr Wozniak submitted that there is nothing to suggest that the Respondent's claim could be classified as 'untenable'. He argues that, putting aside the issue of not being involved in a conclave, the evidence in relation to this matter and the concerns of the Respondent were substantial. The Tribunal's rejection of the arguments does not make them 'fanciful' or 'hopeless' or 'futile' as such to attract an order for costs.
13. Mr Wozniak referred to comments by Judicial Member Molloy in Rucom Pty Ltd and Anor v Multiplex & Ors [2010] NSWADT 1 which I cited in Dee Why Grand Shopping Centre Pty Ltd v Kriletich. In Rucom Pty Ltd and Anor v Multiplex & Ors Judicial Member Molloy stated at paragraph [65]: 65 I wish to repeat the point that has been made on at least two prior occasions in this Tribunal: parties have an obligation to carefully, and consistently, examine their case and, where it doesn't "stack up" then find some way of vacating the field of battle …
14. Mr Wozniak submitted that the Respondent considered its case and believed that the concerns about the involvement of Bretabac and/or Mr Williamson were at the heart of the matter and any conclave would not have resolved those issues. Accordingly the matter was required to proceed, with evidence presented and cross examination occurring, to ascertain the true nature of the position. He contends that any award of costs should take account of the Respondent's view that even if a conclave had occurred the issues would not have been narrowed any further than they had been, and the amount of time taken up on the specific aspect of financial viability based on the figures was small compared to the enquiry in relation to trying to ascertain the true position of the involvement of the Bretabac/Mr Williamson involvement in the running of the business.
15. In any event, Mr Wozniak submitted that should the Tribunal find that an order for costs is warranted, indemnity costs should not be awarded. He referred to the comments by Judicial Molloy in Rucom Pty Ltd and Anor v Multiplex & Ors where he stated at paragraph [61]: "61 Although it is true that the categories of conduct, "sufficient or unusual feature" or "relevant delinquency" are not closed (see Colgate Palmolive at [257]) it is plain that indemnity costs orders are most regularly awarded where litigation is commenced with no reasonable prospects of success. There are a number of cases where such awards have been made where the cases could be generally regarded as "hopeless", or with no chance of success, or categorised as being "without substance", "groundless", "fanciful or hopeless", no reasonable prospects of success or so weak as to be futile. ...
16. Mr Wozniak submitted that it is difficult to classify the Respondent's approach as falling in with any of the descriptions set out above as even if it could be criticised as misguided. If costs are to be awarded they should be awarded only on a limited basis.

Consideration

1. In the substantive matter, the Applicant's financial viability was in issue. The Respondent's contention was that the Applicant was not financially viable to operate any hire car vehicles because without Bretabac and Mr Williamson, the Applicant would not have a viable business. The Applicant was successful in its application and has now sought an order for costs on an indemnity basis.
2. Section 88 of the ADT Act contains a general rule that each party to the proceedings is to bear its own costs of the proceedings and that an award of costs will only be made if the Tribunal is satisfied, having regard to the factors set out in subsection 88(1A), that it is fair to make an award of costs. An order for costs may be made only if the relevant criterion in subsection 88(1A) is satisfied. The criterion of 'fairness' will take into account the compensatory purpose of an award of costs.
3. The Applicant contends that the criterion in subsection 88(1A) (a), (b), (c) and (e) have been satisfied.

Subsection 88(1A)(a)

1. The Tribunal may award costs in relation to proceedings before it, where a party has conducted the proceedings in a way that unnecessarily disadvantaged another party to the proceedings. In my decision in the substantive matter I made comments in relation to the manner in which the Respondent had conducted the proceedings. In particular I made comments in relation to the Respondent's failure to meet its obligation to act as "model litigant". I have referred to passages from the decision above and will not repeat them here.
2. I agree with the Applicant that the approach taken by the Respondent, and particularly the antagonistic approach adopted by counsel for the Respondent, unnecessarily disadvantaged the Applicant. As has been noted, the Respondent did not comply with the President's direction that it particularise its arguments. This placed the Applicant at a disadvantage in preparing for the hearing.
3. I accept Mr Wozniak's submission that in the matter before the Tribunal the Respondent was entitled to raise issues that were not considered in Statement of reasons for the initial determination that was under review. However, the failure to particularise the issues in contention placed the Applicant at a disadvantage in responding to those issues.
4. Further, it is clear that the Applicant attempted to ascertain the nature of the Respondent's concerns and offered to provide the Respondent with information in an effort to address those concerns. In my view, had the Respondent adopted a cooperative approach to that aspect of the proceedings, the issues that remained for determination would have been significantly reduced. In this regard I agree with the Applicant and I do not agree with Mr Wozniak's submissions.

Subsection 88(1A)(b)

1. In my view, the factors referred to above in relation to subsection 88(1A)(a) criterion also had the effect of prolonging unreasonably the time taken to complete the proceedings. Further, as has been noted, the Respondent failed to make its financial expert available to discuss the issues in the proceedings despite the comments and encouragement from the President. Mr Gunton and Ms Lindsay had each prepared their advice from different perspectives. Mr Gunton was apparently of the understanding that the Business was a start-up business and therefore was subject to additional risks that a business acquired as a going concern would not experience. In contrast, Ms Lindsay was clearly of the understanding that the Business was acquired as a going concern. As was apparent from the concessions made by the Respondent's financial expert under cross-examination, that aspect of the hearing could have been largely avoided had the Respondent adopted a different approach.
2. I accept Mr Wozniak's submission that the Respondent was concerned about the extent of the involvement of Bretabac and Mr Williamson in the Applicant's business. However, I do not agree that consultation between the parties could not have assisted in reducing that concern. The Applicant made many invitations to the Respondent to nominate its reasonable requirements in relation to viability so the Applicant could meet those requirements. If the Respondent had concerns about Bretabac's or Mr Williamson's financial circumstances then the Applicant may have been able to address those concerns. By its failure to respond to the Applicant's invitations, the Respondent ensured that resolution of those issues was left to the hearing. In my view, the time needed to address those issues could have been reduced if the Respondent had adopted a consultative approach.

Subsection 88(1A)(c)

1. The Tribunal may award costs in relation to proceedings before it, where a party has made a claim that has no tenable basis in fact or law.
2. As has been noted, the substantive matter concerned the Applicant's financial viability. Mr Gunton's misunderstanding that the Business was a start-up business could have been corrected if the experts had met. Similarly, if the Respondent had advised the Applicant of Mr Gunton's understanding it almost certainly would have been corrected. Mr Gunton was unable to assist in regard to how restricting the Applicant's business to the operation of 3 licences, instead of the 8 licences for which it had applied, would increase its financial viability. In my view, the Respondent's position in that regard was weak, if not untenable.
3. I also agree with Mr Doyle that the Respondent's claim that the Applicant had failed to provide necessary information was unfounded. As noted, Mr Gunton had advised the Applicant in writing and conceded in the witness box that he had not required further information.

Subsection 88(1A)(e)

1. The Tribunal may award costs in relation to proceedings before it, for any other matter that the Tribunal considers relevant. In this regard Mr Doyle pointed to the obligations imposed on the Respondent as a Model Litigant and submitted that the Respondent's approach does not accord with the object stated at section 3(f) of the ADT Act. I agree with that submission.

Indemnity costs

1. As I have indicated, I am generally in agreement with the Applicant that some of the criterion in subsection 88(1A) have been satisfied. I have also been critical of the Respondent's approach to the conduct of the proceedings. I have been particularly critical of the counsel for the Respondent in this regard.
2. In the circumstances of this matter I am satisfied that an award of costs is warranted. However I am not satisfied that it should be on an indemnity basis.
3. I note the comments by Judicial Member Molloy in Rucom Pty Ltd and Anor v Multiplex & Ors to which Mr Wozniak has referred. As Judicial Member Molloy correctly observed, indemnity costs orders are most regularly awarded where litigation is commenced with no reasonable prospects of success or so weak as to be futile. I agree with Mr Wozniak that while the Respondent's position was weak, it is difficult to classify it as falling within any of the descriptions set out in Rucom Pty Ltd and Anor v Multiplex & Ors.

Conclusion

1. In my view, it is fair to make an award of costs in the Applicant's favour in relation to these proceedings. Those costs should be paid on a party-party basis.
2. While I am satisfied that the Applicant was inconvenienced by the Respondent's conduct of the proceedings and that the Respondent's conduct was responsible for prolonging unreasonably the time taken to complete the proceedings, some cost to the Applicant was inevitable. In the circumstances it is my view that the costs should be as assessed or as agreed.

Order The Respondent is to pay the Applicant's costs of and incidental to these proceedings as agreed or assessed on a party-party basis. 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: 28 March 2023