Solicitors:
Mr A Little, HWL Ebsworth (First and Second Plaintiffs)
Mr R Allsop, Allsop Glover Lawyers (First Defendant)
Ms Z Bojanac, Wright Law ILP (Second Defendant)
File Number(s): 2022/00065978
[2]
Overview
These proceedings have their genesis in a residential tenancy agreement ("the lease") entered into on or about 12 July 2018 between Mr Anton Donde (First Plaintiff) and Ms Odile Frank (Second Plaintiff), as lessors, and Mr David York (First Defendant) and Ms Kirsten York (Second Defendant), as lessees, over premises are situated at Clovelly ("the property").
The parties are said to have agreed that in return for a discounted rent afforded by the Plaintiffs, the First Defendant, who had expertise as a builder, would undertake various works at the property and would maintain the property throughout the period of the Defendants' tenancy.
The Statement of Claim filed 7 March 2022 is pleaded as a claim in contract such that the lease, and ancillary contract for works and maintenance detailed in a document appended to the lease, were express and partly written and partly oral.
In essence, the Plaintiffs assert that the Defendants breached the lease and the contract by virtue of having conducted unauthorised works, having damaged the property and having completed some, but not all, of the various works and improvements which had been agreed upon.
The Plaintiffs seek the sum of $44,320.00 in damages for the losses sustained due to a breach of the lease, and the sum of $20,900.00 in damages as a result of the losses suffered due to a breach of the contract. The Statement of Claim envisages that further particulars of damages would be provided "in due course" with respect to both breaches.
Relevantly, the Statement of Claim makes no reference to earlier proceedings ("the NCAT proceedings") in the NSW Civil and Administrative Tribunal (Case No: 2019/49183) ("NCAT"), the central issue on which the Court is called upon to intervene.
The Defendants, in a Defence filed 4 April 2022, and in an Amended Defence filed 24 May 2022 in relation to only the Second Defendant (following her separation from the First Defendant), plead estoppel and contend that this, coupled with the principle of res judicata, preclude the advancement of the Local Court proceedings, having regard to earlier proceedings at, and orders made by, NCAT on or about 16 December 2019 and 3 February 2020, in which the Plaintiffs (as Applicants) and the Defendants (as Respondents) brought to a resolution previously what are generally said to be the same claims and issues in dispute.
In the alternative, the Defendants, in the main, either do not admit, or deny, the assertions of fact outlined by the Plaintiffs in their Statement of Claim. In the case of the Second Defendant, through her Amended Defence, there is an additional denial that she was part of any conversation with the Plaintiffs regarding the terms on which the property would be leased to her and the First Defendant.
When the matter came before the Chief Magistrate, Johnstone DCJ, for case management directions on 21 June 2022, his Honour noted that the Plaintiffs could elect to apply for an amendment to the Statement of Claim to plead a breach of the settlement agreement entered into in finalisation of the NCAT proceedings on or about 3 February 2020. Alternatively, his Honour noted that the Court would exercise jurisdiction under s.73 of the Civil Procedure Act 2005 (NSW) to resolve the preliminary issue regarding the res judicata and estoppel defences arising from the resolution of the NCAT proceedings ("the preliminary issue"), any amendment to the Statement of Claim, and any consequential costs issues.
The matter came before me on 25 October 2022, at which time these issues were ventilated through submissions made by separate legal representatives for the First and Second Defendants, and for the Plaintiff.
[3]
The NCAT proceedings
The NCAT proceedings, which were commenced by the Plaintiffs on or about 2 November 2019, sought a single order, namely, an order for the payment of the sum of $54,360.00, pursuant to s.187(1)(c) of the Residential Tenancies Act 2010 (NSW), as compensation for the Defendants' failure to perform the various works outlined in the lease together with their failure to restore unauthorised changes made to the property absent the consent of the Plaintiffs.
Unlike the Defendants who were legally represented, the self-represented Plaintiffs in the NCAT proceedings agreed, after some negotiations, to compromise their claim by entering into a settlement agreement in order to resolve their dispute expeditiously. Whilst there does not appear to have been a formal Deed of Settlement entered into, which would otherwise have embodied the rights and obligations of the respective parties and which would have enabled a party to plead the Deed as a bar absolute to any future proceedings brought by the other with respect to the same subject matter, the agreement of the parties was formalised via a Notice of Order ("the NCAT orders") dated 3 February 2020, referable to the orders made on 16 December 2019.
In order to better understand the nature of the Defendants' grievance, it is instructive to set out, in full, the NCAT orders, which provided as follows:
[On NCAT letterhead]
Notice of Order
On 16 December 2019, the following orders were made:
In full and final settlement of all issues in dispute:
(1) By consent, the tenant, Kirsten York and David York, C/- York Building Unit 1, 31 - 33 Botany Street, Bondi Junction NSW 2022 Australia, is to pay the landlord, Odile Frank and Anton Donde, [redacted] Clovelly NSW 2031 Australia, the sum of $215.00 on or before 23 December 2019.
Reasons:
- settlement sum $215.00
(2) By consent, the Tribunal orders that the respondent(s): Kirsten York C/- York Building Unit 1, 31 - 33 Botany Street, Bondi Junction NSW 2022 Australia and David York C/- York Building Unit 1, 31 - 33 Botany Street, Bondi Junction NSW 2022 Australia, is to cause the undertaking of the following work in a proper and workmanlike manner on or before 13 January 2020.
Details of Work order:
(a) Move light fitting from master bedroom to child's bathroom.
(b) Replace and install master bathroom light.
(c) Replace kitchen splash back with tiles chosen by the landlord.
(d) Repair or if necessary replace the damaged light fitting in the master bedroom.
(e) Replace wooden Venetian blind in the master bedroom.
(f) Install 5 bedroom wardrobe doors.
(g) Repair the ceiling of the child's bedroom.
If you do not receive the money payable to you as directed by this order, you can get a certified copy of this money order from NCAT. You can then register it with the Local or District Court to enforce the order. For more information about enforcing money orders, visit the NCAT website .
Note: Failure to pay the money owed by this order in the time directed can result in enforcement action being taken in the Local or District Court. If this happens additional costs and interest can be added to the amount payable.
NOTATION
The Tribunal notes that the parties have also agreed on the following terms in settlement of the dispute:
When the current tenants vacate the premises, being on or about 21 November 2020, the respondent tenants are to undertake the following works to completion to the full satisfaction of the landlord, being to Australian building standards. On completion of these works, it is agreed that the dispute between the parties is resolved and that this agreement can be used as a bar to any further proceedings.
(a) Repaint the interior of the rented premises.
(b) Replace the blinds, curtains and wardrobe doors in the master bedroom with Princess Dupioni Silk curtains with colours chosen by the landlord.
P French
Tribunal Member
3/2/2020
[4]
The Plaintiffs' case
The Plaintiffs emphasised the relevant prefatory words in the notation of the NCAT orders, to the effect that the parties agreed that the dispute between them would be considered as having been resolved, the agreement of which could be used as a bar to any further proceedings, "on completion of these works."
The Plaintiffs asserted that they were not precluded from seeking the relief sought in the Statement of Claim on the basis of any estoppel and, moreover, the works outlined in the NCAT orders, to which the Defendants ought to have attended, have not been completed in full. Whilst the NCAT orders numbered 1, 2(a), 2(e) and 2(g) have been complied with, the works outlined in NCAT orders numbered 2(b), 2(c), 2(d) and 2(f), including the works outlined in the Notations numbered (a) and (b), remain outstanding ("the outstanding works").
The Plaintiffs contended that in light of the Defendants' non-performance of its obligations, the dispute between the parties remains unresolved and the NCAT orders were unable to be used as a bar to any further proceedings. This is despite the Plaintiffs having demanded, in writing, on some 13 occasions over a two-year period since the NCAT orders were made, that the Defendant complete the outstanding works.
Absent contravention proceedings which, by virtue of s.75 of the Civil and Administrative Tribunal Act 2013 (NSW) ("the C&AT Act"), can only be brought by the Minister or a person with the written consent of either the Minister or another person authorised by the Minister, the Plaintiffs conceded that they could have taken steps to "renew" the NCAT proceedings, pursuant to cl.8 of Sch.4 of the C&AT Act, although cl.8(2) would have had the effect of requiring a renewal application of this kind to be made within 12 months after the date by which the outstanding works were to have been completed. Given that this period had already elapsed, the Plaintiffs would have been required to seek, and obtain, leave in any application for the renewal of the NCAT proceedings, something which the Plaintiffs initially contended would have resulted in nothing more than yet a further order that the Defendants perform the outstanding works, and which they may have continued to ignore. The Plaintiffs, through subsequent submissions over the period during which judgment was reserved (and with the consent of the Defendants) wrote to the Registrar, to bring to my attention, the fact that there was an alternative remedy available, namely, that NCAT, when considering any application for the renewal of proceedings, could, pursuant to cl.8(4)(a) of Sch.4 of the C&AT Act, make any other appropriate order under the Act or enabling legislation as it could have made when the matter was originally determined.
[5]
The Defendants' case
While the First Defendant and Second Defendant were separately represented in these proceedings, their submissions were, for the purposes of the preliminary issue, closely aligned.
The Defendants contended that the claims made by the Plaintiffs as against the Defendants in the Statement of Claim were the same claims made by the Plaintiffs (as Applicants) and the Defendants (as Respondents) in the NCAT proceedings which culminated in the NCAT orders made by consent, and a notation of an agreement, between the Plaintiffs and Defendants, in full and final settlement of all issues in dispute in those proceedings.
The Defendants posited their case in a number of discrete, although related, ways.
First, the Defendants contended that the claims made by the Plaintiffs in the present proceedings were determined to finality by the NCAT orders made in the NCAT proceedings, such that the claims merged into the judgment set out in the Notice of Order and ceased to exist on the basis of the doctrine of res judicata ("the res judicata ground").
Secondly, and in the alternative, the Defendants contended that the doctrine of estoppel precluded the Plaintiffs from bringing the claims outlined in the Statement of Claim because the parties in the present proceedings were the same parties in the NCAT proceedings, in which the issues raised in the present proceedings were determined to finality by the NCAT orders made in the NCAT proceedings ("the issue estoppel ground").
Thirdly, and in the alternative, to the extent that the Plaintiffs' claims in the Statement of Claim raised new issues, the Defendants contended that the doctrine of the estoppel precluded the Plaintiffs from bringing these claims because they were so connected to the claims made in the NCAT proceedings for them not to have been raised in the earlier proceedings, by virtue of Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589; [1981] HCA 45, and Timbercorp Finance Pty Ltd (in liq) v Collins (2016) 259 CLR 212; [2016] HCA 44 ("the Anshun estoppel ground").
Fourthly, and in the alternative, in the event that the Court were of the view that the Plaintiffs were not estopped by virtue of the NCAT orders made in the NCAT proceedings, the Defendants contended that the Plaintiffs were bound by the agreement outlined in the Notice of Order. It was submitted that the bringing of the present proceedings in this Court, within the context described in Tomlinson v Ramsey Food Processing Pty Ltd (2015) 256 CLR 507; [2015] HCA 28, where the earlier proceedings might for whatever reason not have given rise to an estoppel, was an abuse of process and ought be permanently stayed.
[6]
Relevant legislative provisions
Clause 1 of Sch.4 of the C&AT Act provides, relevantly:
Schedule 4 Consumer and Commercial Division
Part 1 Interpretation
1 Definitions
In this Schedule -
…
the Division means the Consumer and Commercial Division of the Tribunal.
Clause 3 of Sch.4 of the C&AT Act provides, relevantly:
Schedule 4 Consumer and Commercial Division
Part 3 Functions of Division
3 Functions allocated to Division
(1) The functions of the Tribunal in relation to the following legislation are allocated to the Division -
…
Residential Tenancies Act 2010
Clause 8 of Sch.4 of the C&AT Act provides as follows:
8 Renewal of proceedings in respect of certain Division decisions
(1) If the Tribunal makes an order in exercise of a Division function in proceedings, the Tribunal may, when the order is made or later, give leave to the person in whose favour the order is made to renew the proceedings if the order is not complied with within the period specified by the Tribunal.
(2) If an order has not been complied with within the period specified by the Tribunal, the person in whose favour the order was made may renew the proceedings to which the order relates by lodging a notice with the Tribunal, within 12 months after the end of the period, stating that the order has not been complied with.
(3) The provisions of this Act apply to a notice lodged in accordance with subclause (2) as if the notice were a new application made in accordance with this Act.
(4) When proceedings have been renewed in accordance with this clause, the Tribunal -
(a) may make any other appropriate order under this Act or enabling legislation as it could have made when the matter was originally determined, or
(b) may refuse to make such an order.
(5) This clause does not apply if -
(a) the operation of an order has been suspended, or
(b) the order is or has been the subject of an internal appeal.
Section 187 of the Residential Tenancies Act 2010 (NSW) provides, relevantly:
187 Orders that may be made by Tribunal
(1) The Tribunal may, on application by a landlord or tenant or other person under this Act, or in any proceedings under this Act, make one or more of the following orders -
…
(c) an order for the payment of an amount of money,
(d) an order as to compensation,
(e) an order that a party to a residential tenancy agreement perform such work or take such other steps as the order specifies to remedy a breach of the agreement,
…
(4) The Tribunal must not make an order for -
(a) the payment of an amount that exceeds the amount (if any) prescribed by the regulations for the purposes of this section, or
(b) the performance of work or the taking of steps the cost of which is likely to or will exceed the amount (if any) prescribed by the regulations for the purposes of this section.
[7]
Res Judicata
The doctrine of res judicata (often referred to as "cause of action estoppel") is one of the hallmarks of the justice system and straddles both the criminal and civil jurisdictions in its own unique way. Put simply, a res judicata is a decision on the merits, pronounced by a tribunal which is judicial in the relevant sense: K R Handley, Spencer Bower and Handley: Res Judicata (5th ed, 2019, LexisNexis Butterworths) ("Res Judicata") at [2.01]. It involves an adjudication over the cause of action and the parties, which disposes, once and for all, the fundamental matters decided, so that, except on appeal, they cannot be re-litigated between persons bound by the judgment: Res Judicata at [1.01].
It operates in such a way as to preclude the maintenance of any other proceedings on the same cause of action and, in circumstances where the earlier judgment is proved, the original cause of action is merged and ceases to exist independently: Jackson v Goldsmith (1950) 81 CLR 446 at 466 (Fullagar J); [1950] HCA 22; Blair v Curran (1939) 62 CLR 464 at 532 (Dixon J, as his Honour then was); [1939] HCA 23.
The salient rationale on which the principle stands is that, from both a public policy and inter partes perspective, there must be finality to litigation to avoid the re-agitation of issues previously decided and to preclude the introduction of issues which ought to have been ventilated in earlier proceedings.
In Blair v Curran (1939) 62 CLR 464; [1939] HCA 23, Dixon J (as his Honour then was) held at 531 - 532:
A judicial determination directly involving an issue of fact or of law disposes once and for all of the issue, so that it cannot afterwards be raised between the same parties or their privies. The estoppel covers only those matters which the prior judgment, decree or order necessarily established as the legal foundation or justification of its conclusion, whether that conclusion is that a money sum be recovered or that the doing of an act be commanded or be restrained or that rights be declared. The distinction between res judicata and issue-estoppel is that in the first the very right or cause of action claimed or put in suit has in the former proceedings passed into judgment, so that it is merged and has no longer an independent existence, while in the second, for the purpose of some other claim or cause of action, a state of fact or law is alleged or denied the existence of which is a matter necessarily decided by the prior judgment, decree or order.
[8]
Issue Estoppel
Issue estoppel, on the other hand, attends upon a particular issue in the proceedings, rather than the more broader cause of action. Issue estoppel will materialise where "a particular issue was judicially determined in previous litigation between the parties, although the previous cause of action was not identical with the current cause": The CCH Macquarie Dictionary of Law (rev ed, CCH, 1996) p 92.
For issue estoppel to be enlivened, the issues the subject of scrutiny must be identical, even though the causes of action might not be the same: New Brunswick Railway Co v British & French Trust Corp Ltd [1939] AC 1 (at 20) (Lord Maugham LC).
[9]
Anshun Estoppel
By further extension, Anshun estoppel operates to preclude the introduction of causes of action or issues in later proceedings which could have been, and ought to have been, raised in earlier proceedings, the logic being that there should be an avoidance of the possibility of an inconsistency between the decisions of two tribunals: Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589; [1981] HCA 45. Of course, with this, comes the general policy-based reasoning of ensuring a more efficient use of judicial resources and time: Ford Motor Co of Australia Ltd v Tristar Steering & Suspension Australia Ltd [2003] FCA 596 at [35] (Goldberg J). The test imported is one of reasonableness: Boles v Esanda Finance Corp Ltd (1989) 18 NSWLR 666.
Importantly, Anshun estoppel will not be enlivened where the cause of action or issue could not have been raised in the earlier proceedings by virtue of a lack of jurisdiction of the tribunal in those proceedings: See Morlend Finance Corp (Vic) Pty Ltd v Levine [1990] VR 205, in which it was held that because credit related matters under the Credit Act 1984 (Vic) were allocated exclusively to the Small Claims Tribunal, there was no estoppel which arose.
[10]
Consideration
Given that res judicata and the closely associated principle of estoppel, in all its manifestations, were central to the arguments raised by the Defendants, it would be remiss of the Court not to make mention of the obvious tension between an earlier judgment following a hearing "on the merits" and a judgment which is entered "by consent", as was the case in the present dispute.
The doctrine of res judicata has as much application in matters adjudicated in the traditional sense, via a defended hearing, as it does in matters resolved through negotiations and subsequent terms of settlement. Thus, an estoppel may be enlivened in circumstances where a judgment is entered by consent, although a careful consideration of the legally indispensable parts of the earlier pronouncement is required. In any such settlement by consent, the tribunal is relieved of the obligation to engage with the issues in dispute and of the need to give reasons for decision and a judicial pronouncement. It is the will of the parties, following successful negotiations, that the court give its judicial endorsement to the agreement reached, which operates to create a bar to future proceedings.
In Marshall v Prescott (No 3) [2013] NSWSC 1949, Beech-Jones J (as his Honour then was) observed at [135] that:
… A judgment or order by consent is a res judicata (Chamberlain v Deputy Commissioner of Taxation [1988] HCA 21; 164 CLR 502 at 508, Isaacs v Ocean Accident & Guarantee Corporation Ltd (1957) 58 SR (NSW) 69 at 75 per Street CJ and Roper CJ in Eq; Nau v Kemp & Associates Pty Ltd [2010] NSWCA 164; 77 NSWLR 687 per McColl JA at [64]). It is as effective as one pronounced after a hearing in merging the cause of action sued on in the judgment. However the fact that "a judgment is entered by consent may on occasion make it hard to say what was necessarily decided by the judgment" (Chamberlain at 508).
His Honour continued (at [136]):
… Although a judgment or order by consent may give rise to issue estoppels, the question of the extent to which it may do so is not settled (K.R. Handley, Spencer Bower and Handley: Res Judicata, 4th Ed (2009) at p 20). As Street CJ and Roper CJ in Eq stated in Isaacs, "[i]t is clear that the mere fact that the judgment is by consent does not detract from its conclusive effect upon the issues determined by it" (at 75). A judgment, whether by consent or not, operates by way of estoppel only in relation to those matters which are necessarily decided by it (id). The observation in Chamberlain (at 508) noted above as to the difficulty in determining what Consent Orders have decided applies equally to issue estoppel as it does to res judicata.
[11]
Findings and Orders
For the above reasons, I make the following findings and orders:
1. Pursuant to s.73 of the Civil Procedure Act 2005 (NSW), on the preliminary issue, I find, on the balance of probabilities, that the principles of res judicata and issue estoppel attend upon the earlier judgment entered by consent by the NSW Civil and Administrative Tribunal on 16 December 2019 and 3 February 2020.
2. Pursuant to s.73 of the Civil Procedure Act 2005 (NSW), on the preliminary issue, I find, on the balance of probabilities, that the Plaintiffs' claim, in its current form, cannot be maintained.
3. Pursuant to s.64(1)(b) of the Civil Procedure Act 2005 (NSW), leave is granted to the Plaintiffs to amend the Statement of Claim to plead the agreement outlined in the NSW Civil and Administrative Tribunal Notice of Order dated 3 February 2020.
[12]
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: 13 March 2023
In essence, provided that the Plaintiffs were successful in obtaining leave to bring a renewal application out of time, they could seek, in the alternative to the original order for the performance of works, a monetary order as against the Defendants. Even if successful in obtaining a monetary order, this, the Plaintiffs submitted, would not have adequately compensated them for the losses suffered, given that the prescribed jurisdictional limit with respect to which NCAT is empowered to make monetary orders is, by virtue of s.187(4)(a) of the Residential Tenancies Act 2010 (NSW) and cl.40(b) of the Residential Tenancies Regulation 2019 (NSW), the sum of $15,000.00.
Clause 40 of the Residential Tenancies Regulation 2019 (NSW) provides as follows:
40 Monetary limit of jurisdiction of Tribunal - s 187(4)(a) of Act
For the purposes of section 187(4)(a) of the Act, the amount prescribed is -
(a) if the order is with respect to a rental bond - $30,000, or
(b) otherwise - $15,000.
Section 73 of the Civil Procedure Act 2005 (NSW) provides as follows:
73 Power of court to determine questions about compromises and settlements
(1) In any proceedings, the court -
(a) has and may exercise jurisdiction to determine any question in dispute between the parties to the proceedings as to whether, and on what terms, the proceedings have been compromised or settled between them, and
(b) may make such orders as it considers appropriate to give effect to any such determination.
(2) This section does not limit the jurisdiction that the court may otherwise have in relation to the determination of any such question.
In Tomlinson v Ramsay Food Processing Pty Ltd (2015) 256 CLR 507; [2015] HCA 28, French CJ, Bell, Gageler and Keane JJ at [22] summarised issue estoppel as follows:
Estoppel in that form operates to preclude the raising in a subsequent proceeding of an ultimate issue of fact or law which was necessarily resolved as a step in reaching the determination made in the judgment. The classic expression of the primary consequence of its operation is that a "judicial determination directly involving an issue of fact or of law disposes once for all of the issue, so that it cannot afterwards be raised between the same parties or their privies".
The issue of res judicata, captured through judgments entered based on consent orders (and notations), was considered in detail in Beck v Weinstock; Beck v L W Furniture (Consolidated) Pty Ltd [2012] NSWCA 289, wherein Campbell J (with whom McColl and Meagher JJA agreed) after highlighting the distinction between "preliminary matters" and the "mandatory part" of the decree or order, observed that:
58 Sometimes, if a dispute that has become the subject of litigation is settled, the settlement takes the form of an agreement that the court will make certain orders. Such an agreement is implemented by the parties jointly requesting the court to make those orders, and the court actually making those orders by consent. But disputes are sometimes settled by different mechanisms. One is an agreement between the parties whose commercial substance is not embodied in court orders, and the litigation is brought to an end by a consent order that is quite uninformative about the real commercial basis on which the dispute has been brought to an end, such as an order there be judgment for the Defendant with no order as to costs.
59 There is a middle course, which was adopted in the present case. If parties to litigation request the court to make certain orders by consent, they can also request the court to note the terms of an agreement between the parties but for that agreement not to result in the court actually ordering anything concerning the subject matter of the agreement. There can be advantages for the parties in having the court note such an agreement - the note in the court records provides excellent evidence of the terms of the agreement, and the fact that the note appears accompanying certain orders of the court can assist in making clear that the agreement bears a relationship to those orders (though the precise nature of any such relationship might need to be established by other evidence).
60 However, the fact that a judge notes the agreement, and that note is entered in the court's records, does not change its essential status - it is still an agreement between the parties, not an order of the court. Indeed, sometimes a court is prepared to note an agreement in circumstances where the court would decline to make an order to similar effect, such as when the court notes an agreement that terms of settlement not be disclosed. That distinction between agreements that the court will, if asked, give effect to by itself pronouncing an order, and agreements that the court is willing to note but will not turn into an actual order is recognised in UCPR 36.1A, which provides:
(1) The court may give judgment, or order that judgment be entered, in the terms of an agreement between parties in relation to proceedings between them.
(2) Unless the court, for special reasons, otherwise orders, the court must refuse to give judgment, or order that judgment be entered, in terms that restrict, or purport to restrict, any disclosure of the terms of the judgment or order.
(3) Subrule (2) does not limit the effect of any agreement between the parties that contains provisions that restrict the parties, or purport to restrict the parties, from disclosing the terms of the agreement or of the judgment or order.
Campbell J helpfully distilled the relevant principles and it is instructive to quote them here: -
63 An agreement that is noted by a court, but does not result in a court order being made that gives the court's authority to the agreement does not result in a res judicata. The first edition of Spencer-Bower, The Doctrine of Res Judicata (1924), Butterworth & Co London, states as follows:
"14. A res judicata is a judicial decision, pronounced by a judicial tribunal. It is of no avail to prove that the alleged res judicata was a decision, or even that it was a judicial one, in the sense that it was pronounced according to judicial principles, unless it be also established that it emanated from a judicial tribunal in the exercise of its judicial functions; nor, on the other hand, is it sufficient to shew that it was pronounced by a judicial tribunal, unless it be also shown that it was a decision, and a judicial one, as distinguished from a termination of the proceedings otherwise than by a judicial decision.
...
23. In order to establish a res judicata on which an estoppel may be founded, it must appear ... that what was pronounced amounted to a judicial decision. There must have been ... a judicium, which for purposes of estoppel means a decision or determination or adjudication of some question of law or fact, whether such decision takes the form of an express judicial declaration, or is necessarily involved in the command or prohibition which constitutes the judgment or judicial in its coercive or operative aspect.
...
33. Any judgment or order which in other respects answers to the description of a res judicata is none the less so because it was made in pursuance of the consent and agreement of the parties. It is true that, in such cases, the court is discharged from the duty of investigating, or (where the consent is given at a late stage in the proceedings) further investigating, the matters in controversy, and is not asked to, and does not, pronounce a judicial opinion upon any of such matters; but it is none the less true also that, at the joint request of the parties, the tribunal gives judicial sanction and coercive authority to what those parties have settled between themselves, and in that way converts a mere agreement which, except in certain special cases the subject of express statutory provision in that behalf, could only operate as an agreement, and not as a bar, into a judicial decision on which a plea of res judicata may be founded. Accordingly, judgments, orders, and awards by consent have always been held no less efficacious as estoppels than other judgments, orders, or decisions, though doubts have been occasionally expressed whether, strictly, the foundation of the estoppel in such cases is not representation by conduct, rather than res judicata.
34. But, though consent judgments and orders are undoubtedly in every case decisions in the sense that the actual mandatory or prohibitive parts of the judgment or order is conclusively binding upon, not only the parties , but the rest of the world, it may often be a matter of legitimate doubt and debate as to what, if any, particular questions or issues of right, title, or liability were, expressly or impliedly, the subject of the consent, and of the decision. For this purpose, as for all other purposes connected with the ascertainment of the subject-matter of a decision, the court will closely examine all such evidence, if any, as is available and admissible, and, by the aid of such materials, will ascertain whether any and what adjudication of matters in dispute was expressed, or necessarily involved, in the actual decision assented to. Any issue or question which is thus shown to have been recognized or taken by the parties as the subject of the litigation, and of the judgment or order agreed to, is deemed to have been thereby conclusively determined, so as to preclude any subsequent challenge. Where, however, there are no such materials, available as are above indicated, there is nothing which can operate as a decision of any particular question or issue, and neither party is estopped from disputing anything but the actual judgment or order itself." (italics in original)
It was not in dispute that NCAT was a tribunal sufficiently seized of jurisdiction to deal with the earlier proceedings and, notwithstanding the use of the word "Administrative" in its title, did not change the fact that the doctrines described above extended to it, having regard to its decision-making powers to determine to finality, in a judicial sense, disputes falling within its purview: Administration of Papua and New Guinea v Daera Guba (1973) 130 CLR 353 at 453 (Gibbs J); [1973] HCA 59; Kuligowski v MetroBus (2004) 220 CLR 363; [2004] HCA 34, at [22] (Gleeson CJ, McHugh, Gummow, Kirby, Hayne, Callinan and Heydon JJ).
Indeed, matters arising under the Residential Tenancies Act 2010 (NSW) are specifically allocated to the Consumer and Commercial Division of NCAT. Specifically allocated, however, does not necessarily mean exclusively allocated. What crystallised from a careful consideration of the C&AT Act and the Residential Tenancies Act 2010 (NSW) was that whilst NCAT likely deals with most rent disputes in this State, it did not, and had no jurisdiction to, deal with matters where the value of the claim exceeded $15,000.00. Such claims could, quite properly, be brought in the Local Court, District Court or even the Supreme Court, at first instance, depending on the value of the principal claim.
So as to resolve their dispute, the Plaintiffs, as I see it, had two choices; First, to commence proceedings at NCAT seeking either a monetary order or a work order, or a combination of both (as they did); or, secondly, as an alternative, to commence proceedings in this Court seeking damages for a breach of the lease and contract. The former option would have constrained any financial outcome to the jurisdictional limit of $15,000. The latter option would have comfortably encapsulated the Plaintiffs' claim of $54,360.00 within this Court's jurisdictional limit of $100,000.00: Local Court Act 2007 (NSW), s.29(1)(a).
But for three items (a refrigerator, a table and a barbecue) which do not appear to have formed the basis of the NCAT proceedings, the cause of action and issues pleaded in this Court are substantially similar to those on which the NCAT proceedings were based. The comparative table prepared by counsel for the Second Defendant in the helpful written submissions dated 25 October 2022 highlights the striking similarities.
On the preliminary issue, and having regard to the quantum of the claim, the Plaintiffs, having chosen to litigate at (by commencing proceedings in, engaging with and submitting to the non-exclusive jurisdiction of) NCAT, cannot now protest that they ought be permitted to plead their case in the same manner as they did in the earlier proceedings, reliant on initiating process substantially identical to the NCAT proceedings.
When assessing the two sets of proceedings and the claims on which they were founded, I was satisfied, on the balance of probabilities, that the principles of res judicata and issue estoppel attend upon the earlier judgment such that:
(a) the NCAT orders were final and conclusive (albeit by consent);
(b) substantially the same cause of action and issues arise; and
(c) the same parties with the same legal interests arise.
One of the focal points of enquiry made by the Court in its oral exchange with counsel for the various parties was whether a formal written agreement had been entered into between them upon the settlement of the NCAT proceedings, as an ancillary document on which the Plaintiffs could have sued in the Local Court. It was clear that there was no such agreement. Its presence would, obviously, have facilitated the bringing of proceedings, with greater administrative ease, in this jurisdiction. Its absence, though, given the phraseology in the Notice of Order, would not impede the bringing of proceedings in this jurisdiction, reliant upon the agreement referred to therein.
In any event, this could be achieved by the granting of leave to amend the Statement of Claim to plead the agreement, which would regularise the proceedings in this jurisdiction and permit the parties, and the Court, to focus on, and to facilitate, the just, quick and cheap resolution of the real issues for determination in the proceedings, consistent with the overriding purpose set out in s.56 of the Civil Procedure Act 2005 (NSW).
I would be disinclined to find that Plaintiffs' commencement of proceedings in this Court, an available forum given the non-exclusivity in the jurisdiction of NCAT, amounted to an abuse of process warranting a stay of proceedings. Determinations of this kind are to be exercised with great caution and, in light of the availability of an alternative which will facilitate the resolution of the real issues in dispute via a hearing on the merits, I decline, to the extent necessary to address this ground, to order a stay.
Further, to strike out the Plaintiffs' Statement of Claim would only serve to add expense and delay.
Following the pronouncement of the findings and orders below, I will hear the parties as to costs and further case management directions.