FFO v Cumberland Council

NCAT Appeal Panel|2022-08-10

REASONS FOR DECISION

In a decision published in this matter on 18 May 2022, FFO's application for an extension of time within which to lodge an appeal against a first instance decision of the Tribunal was refused on the basis that the proposed appeal had no merit (see FFO v Cumberland Council [2022] NSWCATAP 164).
The Cumberland Council ('the Council') has now applied for an order for costs in relation to both the application for an extension of time within which to appeal, and also in relation to the attendance in the Tribunal on 4 February 2022, when it was expected that an application by FFO for a stay would be heard, but the application was withdrawn.

Should the Tribunal dispense with a hearing in relation to costs

The Civil and Administrative Tribunal Act 2013 (NSW) ('the CAT Act'), in s 50, provides: 50 When hearings are required (1) A hearing is required for proceedings in the Tribunal except - (a) in proceedings for the granting of leave for an external or internal appeal, or (b) in connection with the use of any resolution processes in proceedings, or (c) if the Tribunal makes an order under this section dispensing with a hearing, or (d) in such other circumstances as may be prescribed by the procedural rules. (2) The Tribunal may make an order dispensing with a hearing if it is satisfied that the issues for determination can be adequately determined in the absence of the parties by considering any written submissions or any other documents or material lodged with or provided to the Tribunal. (3) The Tribunal may not make an order dispensing with a hearing unless the Tribunal has first - (a) afforded the parties an opportunity to make submissions about the proposed order, and (b) taken any such submissions into account. (4) The Tribunal may determine proceedings in which a hearing is not required based on the written submissions or any other documents or material that have been lodged with or provided to the Tribunal in accordance with the requirements of this Act, enabling legislation and the procedural rules. (5) This section does not prevent the Tribunal from holding a hearing even if it is not required.

The application for costs

The Civil and Administrative Tribunal Act 2013 provides, in s 60: 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.
Our task, therefore, is to determine whether there are special circumstances warranting an order for costs, bearing in mind that the usual course is that each party pays its own costs.
In Edwards v Commissioner for Fair Trading, Department of Customer Service (Costs) [2019] NSWCATAP 249, at [9], the Appeal Panel said: Special circumstances are circumstances that are out of the ordinary, but need not be those which are exceptional or extraordinary. These principles are well established and have been consistently applied in this Tribunal: Megerditchian v Kurmond Homes Pty Ltd [2014] NSWCATAP 120 at [11]; Commissioner for Fair Trading v Edward Lees Imports Pty Ltd (No 2) [2019] NSWCATAP 222 at [8]; CPD Holdings Pty Ltd t/as The Bathroom Exchange v Baguley [2015] NSWCATAP 21 at [32].
Our discretion to award costs must be exercised judicially, and not arbitrarily, capriciously or so as to frustrate the legislative intent (see Oshlack v Richmond River Council (1998) HCA 11 at [22]).
We bear in mind that a costs order is compensatory and not punitive (see Dr Douglass v Lawton Pty Ltd (No 2) [2007] NSWCA 90 at [22]).

Costs of the Stay Application

FFO's application for a stay in this matter, filed on 18 January 2022, sought the following order: Immediate stay on the Tribunal's determination of the substantive matter 2021/205873 pending the outcome of the Appellant's appeal of the decision to dismiss the Appellant's s 64(1)(d) application.
The application, under 'Grounds for application of order' said: As of today (18/01/2022) a finding on the substantive merits is 'reserved'. The Tribunal may wish to consider a stay on the finalising the substantive matter pending the outcome of the appeal [sic].
The application the subject of the appeal was an application by FFO for orders under s 64(1)(d) of the Civil and Administrative Tribunal Act 2013 prohibiting the disclosure, to three specified officers of the Council, of legal submissions and evidentiary documentation, and, also, an order prohibiting the disclosure of evidence bundles 1b, 2a and 2b to Mr McFadzean, General Counsel of Council.
On 21 December 2021, SM Ransome refused to make the orders sought under s 64(1)(d).
The matter referred to by FFO as 'the substantive matter' was argued before SM Christie, who reserved his decision on 18 January 2022.
On 4 February 2022, FFO's application for a stay came before PM Suthers for hearing. By that time, FFO had filed and served submissions with respect to the application for a stay, and the Council had filed and served an affidavit and submissions.
In the course of the hearing on 4 February 2022, FFO withdrew the application for a stay.
In Re Minister for Immigration and Ethnic Affairs Ex parte Lai Qin (1997) 186 CLR 622, Mc Hugh J said: In an appropriate case, a court will make an order for costs even when there has been no hearing on the merits and the moving party no longer wishes to proceed with the action. The court cannot try a hypothetical action between the parties[3]. To do so would burden the parties with the costs of a litigated action which by settlement or extra-curial action they had avoided. In some cases, however, the court may be able to conclude that one of the parties has acted so unreasonably that the other party should obtain the costs of the action[4].
FFO's application for a stay of 'the substantive matter', in effect, sought to prevent SM Christie from making the decision which had been reserved on 18 January 2022 until FFO's appeal against SM Ransome's refusal to make orders prohibiting the disclosure of evidence and submissions in the matter to certain officers of the Council had been decided. The application for a stay was made after the substantive matter had been heard at first instance, so the Council had been in possession of the documents and submissions for some time and had prepared and presented its case at first instance, as had FFO.
At no time did the application for a stay have any merit, or even any practical utility. The application had no tenable basis and was misconceived.
FFO's decision to withdraw his application for a stay in the course of the hearing prevented the Council from incurring any further costs in relation to the stay application subsequent to 4 February 2022. However, by then, the Council had expended legal costs in preparing for the argument in relation to the stay, including the preparation of an affidavit and written submissions and its attendance at the hearing.
It was argued on behalf of FFO that some tolerance ought to be extended to unrepresented litigants who do not understand legal concepts (see DYH v Public Guardian (No 3) [2022] NSWCATAP 34 at [19]). We agree, and we bear this in mind. We also bear in mind s 60 of the CAT Act. We determine, however, that special circumstances within the meaning of s 60(3) of the CAT Act are present in relation to the costs application in relation to the stay application, in that it plainly had no tenable basis and no practical utility.
FFO argued that the Tribunal has a discretion in relation to an application for an award of costs, even when special circumstances are present. We agree. In all of the circumstances, the appropriate exercise of our discretion is to make an order for the costs of the stay application in the Council's favour.
FFO will be ordered to pay the Council's costs in relation to the stay application.

Costs of the appeal

The decision in relation to the appeal in this matter sets out in some detail the reasons for the Tribunal's determination that none of the subject matter argued by FFO as grounds of appeal raised an error of law, and that the appeal had no merit. We will not repeat what we said in the decision.
In the decision in relation to the appeal in this matter, we listed the following subject matter as having been raised by FFO: 1. FFO's concern about the potential for the misuse of his information/documents. 2. FFO's belief that his personal information should not be disclosed without careful consideration, without security safeguards to protect it from misuse and without his knowledge and consent. 3. FFO's seeking of the order under s 64 of the CAT Act as a safeguard against the misuse of the documents in other proceedings. 4. FFO's contention with respect to the limits which he believes should be in existence upon the use to which the Council may make of documents when preparing its case. 5. FFO's assertion that past breaches of his privacy have had a detrimental psychological effect upon him and that the Tribunal at first instance should have allowed him to tender medical reports to the Tribunal at first instance after the decision at first instance had been announced. 6. FFO's apprehension that his failure to obtain orders under s 64 of the CAT Act would have a negative impact upon the Tribunal's decision with respect to the substantive application.
None of FFO's grounds or arguments raised a question of law.
The appeal had no tenable basis in law or in fact. The appeal was misconceived. This is not a matter in which the appellant failed in relation to an arguable point. Special circumstances warranting an award of costs are present in relation to the legal costs of the appeal.
FFO submitted that he had 'genuine concerns' about the potential use of documents. The pursuit of an appeal, however, was not an appropriate method of dealing with those concerns. Obtaining legal advice would have been a more appropriate course, which would not have involved the Council in expenditure on legal advice and representation.
As we have said, we agree with FFO's submission, that, even when special circumstances exist, the Tribunal has a discretion as to whether or not an award of costs should be made.
In this matter, in all of the circumstances, we consider that the proper exercise of our discretion under s 60(2) of the CAT Act is to order that FFO pay the legal costs of the Council in relation to the costs of the appeal.

Orders

We will make the following orders: 1. FFO is to pay the costs of the Council in relation to the application for a stay filed on 18 January 2022 in this matter to be agreed or assessed. 2. FFO is to pay the costs of the Council in relation to this appeal to be agreed or assessed.

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

Amendments 19 August 2022 - Date of decision - amended year from 2002 to 2022 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: 19 August 2022

Special circumstances are circumstances that are out of the ordinary, but need not be those which are exceptional or extraordinary. These principles are well established and have been consistently applied in this Tribunal: Megerditchian v Kurmond Homes Pty Ltd [2014] NSWCATAP 120 at [11]; Commissioner for Fair Trading v Edward Lees Imports Pty Ltd (No 2) [2019] NSWCATAP 222 at [8]; CPD Holdings Pty Ltd t/as The Bathroom Exchange v Baguley [2015] NSWCATAP 21 at [32].

Our discretion to award costs must be exercised judicially, and not arbitrarily, capriciously or so as to frustrate the legislative intent (see Oshlack v Richmond River Council (1998) HCA 11 at [22]).
We bear in mind that a costs order is compensatory and not punitive (see Dr Douglass v Lawton Pty Ltd (No 2) [2007] NSWCA 90 at [22]).

FFO's application for a stay in this matter, filed on 18 January 2022, sought the following order:

Immediate stay on the Tribunal's determination of the substantive matter 2021/205873 pending the outcome of the Appellant's appeal of the decision to dismiss the Appellant's s 64(1)(d) application.

The application, under 'Grounds for application of order' said:

As of today (18/01/2022) a finding on the substantive merits is 'reserved'. The Tribunal may wish to consider a stay on the finalising the substantive matter pending the outcome of the appeal [sic].

The application the subject of the appeal was an application by FFO for orders under s 64(1)(d) of the Civil and Administrative Tribunal Act 2013 prohibiting the disclosure, to three specified officers of the Council, of legal submissions and evidentiary documentation, and, also, an order prohibiting the disclosure of evidence bundles 1b, 2a and 2b to Mr McFadzean, General Counsel of Council.
On 21 December 2021, SM Ransome refused to make the orders sought under s 64(1)(d).
The matter referred to by FFO as 'the substantive matter' was argued before SM Christie, who reserved his decision on 18 January 2022.
On 4 February 2022, FFO's application for a stay came before PM Suthers for hearing. By that time, FFO had filed and served submissions with respect to the application for a stay, and the Council had filed and served an affidavit and submissions.
In the course of the hearing on 4 February 2022, FFO withdrew the application for a stay.
In Re Minister for Immigration and Ethnic Affairs Ex parte Lai Qin [1997] HCA 6; (1997) 186 CLR 622, Mc Hugh J said:

In an appropriate case, a court will make an order for costs even when there has been no hearing on the merits and the moving party no longer wishes to proceed with the action. The court cannot try a hypothetical action between the parties[3]. To do so would burden the parties with the costs of a litigated action which by settlement or extra-curial action they had avoided. In some cases, however, the court may be able to conclude that one of the parties has acted so unreasonably that the other party should obtain the costs of the action[4].

FFO's application for a stay of 'the substantive matter', in effect, sought to prevent SM Christie from making the decision which had been reserved on 18 January 2022 until FFO's appeal against SM Ransome's refusal to make orders prohibiting the disclosure of evidence and submissions in the matter to certain officers of the Council had been decided. The application for a stay was made after the substantive matter had been heard at first instance, so the Council had been in possession of the documents and submissions for some time and had prepared and presented its case at first instance, as had FFO.
At no time did the application for a stay have any merit, or even any practical utility. The application had no tenable basis and was misconceived.
FFO's decision to withdraw his application for a stay in the course of the hearing prevented the Council from incurring any further costs in relation to the stay application subsequent to 4 February 2022. However, by then, the Council had expended legal costs in preparing for the argument in relation to the stay, including the preparation of an affidavit and written submissions and its attendance at the hearing.
It was argued on behalf of FFO that some tolerance ought to be extended to unrepresented litigants who do not understand legal concepts (see DYH v Public Guardian (No 3) [2022] NSWCATAP 34 at [19]). We agree, and we bear this in mind. We also bear in mind s 60 of the CAT Act. We determine, however, that special circumstances within the meaning of s 60(3) of the CAT Act are present in relation to the costs application in relation to the stay application, in that it plainly had no tenable basis and no practical utility.
FFO argued that the Tribunal has a discretion in relation to an application for an award of costs, even when special circumstances are present. We agree. In all of the circumstances, the appropriate exercise of our discretion is to make an order for the costs of the stay application in the Council's favour.
FFO will be ordered to pay the Council's costs in relation to the stay application.

The decision in relation to the appeal in this matter sets out in some detail the reasons for the Tribunal's determination that none of the subject matter argued by FFO as grounds of appeal raised an error of law, and that the appeal had no merit. We will not repeat what we said in the decision.
In the decision in relation to the appeal in this matter, we listed the following subject matter as having been raised by FFO:

(1) FFO's concern about the potential for the misuse of his information/documents.

(2) FFO's belief that his personal information should not be disclosed without careful consideration, without security safeguards to protect it from misuse and without his knowledge and consent.

(3) FFO's seeking of the order under s 64 of the CAT Act as a safeguard against the misuse of the documents in other proceedings.

(4) FFO's contention with respect to the limits which he believes should be in existence upon the use to which the Council may make of documents when preparing its case.

(5) FFO's assertion that past breaches of his privacy have had a detrimental psychological effect upon him and that the Tribunal at first instance should have allowed him to tender medical reports to the Tribunal at first instance after the decision at first instance had been announced.

(6) FFO's apprehension that his failure to obtain orders under s 64 of the CAT Act would have a negative impact upon the Tribunal's decision with respect to the substantive application.

None of FFO's grounds or arguments raised a question of law.
The appeal had no tenable basis in law or in fact. The appeal was misconceived. This is not a matter in which the appellant failed in relation to an arguable point. Special circumstances warranting an award of costs are present in relation to the legal costs of the appeal.
FFO submitted that he had 'genuine concerns' about the potential use of documents. The pursuit of an appeal, however, was not an appropriate method of dealing with those concerns. Obtaining legal advice would have been a more appropriate course, which would not have involved the Council in expenditure on legal advice and representation.
As we have said, we agree with FFO's submission, that, even when special circumstances exist, the Tribunal has a discretion as to whether or not an award of costs should be made.
In this matter, in all of the circumstances, we consider that the proper exercise of our discretion under s 60(2) of the CAT Act is to order that FFO pay the legal costs of the Council in relation to the costs of the appeal.

(1) FFO is to pay the costs of the Council in relation to the application for a stay filed on 18 January 2022 in this matter to be agreed or assessed.

(2) FFO is to pay the costs of the Council in relation to this appeal to be agreed or assessed.

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.

19 August 2022 - Date of decision - amended year from 2002 to 2022

Administrative Tribunal Act 2013

Profession Uniform Law Application Act 2014

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Judgment (23 paragraphs)

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