FHH v Port Stephens Council

NCAT Appeal Panel|2023-10-23

Introduction

On 25 August 2023, the Appeal Panel dismissed the Appellants' appeal on all grounds: see FHH v Port Stephens Council [2023] NSWCATAP 239 (the Decision).The Appeal Panel set a timetable for any costs application by the parties. The Respondent has applied for its costs in respect of the appeal.
The issues for determination are: 1. Should a hearing of the costs application be dispensed with? 2. Should an order for costs be made in favour of the Respondent? 3. Should a lump sum order be made?

Should a hearing of the costs application be dispensed with?

Pursuant to s 50(2) of the Civil and Administrative Tribunal Act 2013 (NCAT Act), the Tribunal may make an order dispensing with the 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 document or material lodged with or provided to the Tribunal.
The directions of the Appeal Panel afforded the parties an opportunity to make submissions as to whether or not a hearing of the costs application should be dispensed with. The parties did not object to the hearing of the costs application being dispensed with.
We are satisfied that the issue of costs can be adequately determined in the absence of the parties by considering the parties' submissions and written evidence. The parties would be put to unnecessary expense if required to argue the costs application at a hearing. An order under s 50(2) of the NCAT Act has accordingly been made.

Should the Appeal Panel order the Appellant to pay the Respondent's costs?

Relevant principles

Section 60 of the NCAT Act provides as follows: 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.
The Appeal Panel in Grasso v Owners of Strata Plan No 52399 [2023] NSWCATAP 91 at [12] discussed the established principles in respect of an order of costs in 'special circumstances' as provided for in s 60 of the NCAT Act as follows: 12 Certain principles have been established concerning an award of cost as follows: (1) An application for costs can only succeed before the Tribunal if it can be shown that "the circumstances are out of the ordinary. They do not have to be extraordinary or exceptional.": Santow JA in Cripps v G & M Mawson [2006] NSWCA 84 at [60] in relation to s 88 (1) of the Administrative Decisions Tribunal Act 1997, which, by analogy, is a useful statement applicable in this Tribunal; (2) "An assessment whether circumstances are "special" involves the exercise of a value judgement carried out by way of comparison between what is not "special", and what is special.": See Alexander James Pty Ltd v Pozetu Pty Ltd (No.2) [2016] NSWCATAP 75 at [14]; (3) the nature and complexity of the appeal proceedings is the relevant consideration; not the nature and complexity of the proceedings at first instance: see Sahade v Owners SP No 62022 [2015] NSWATAP 225 at [38]; (4) the power to award costs is a discretionary power vested in the decision maker: see Re Minister for Immigration and Ethnic Affairs; Ex parte Lai Qin (1997) 186 CLR 62 at 65; [1997] HCA 6; (5) the exercise the discretion requires a tribunal "to weigh whether those circumstances are sufficient to amount to "special circumstances that justify departing from the general rule that each party bear its own costs": see The Owners - Strata Plan No 63731 v B&G Trading Pty Ltd (No2) [2020] NSWCATAP 273 at [13]; (6) an order for costs is intended to compensate the successful party: it is not intended to be punitive in nature: Oshlak v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72; Hamod v State of New South Wales (2002) 188 ALR 659; [2002] FCA 424; [2002] FCAFC 97; and (7) the discretion to award costs is to be exercised judicially: Nguyen v Perpetual Trustee Co Ltd [2015] NSWCATAP 264 at [94].

Respondent's submissions

The Respondent put forward relevant considerations which it submitted amounted to special circumstances warranting an award of costs in favour of the Respondent: 1. The relevant strength 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; and 2. The proceedings were frivolous or vexatious or otherwise misconceived or lacking in substance.
The Respondent referred to the fact that the Notice of Appeal covered three grounds of appeal as follows: 1. The Decision did not accurately articulate the real issues in dispute; 2. The Decision failed to address and deal with the real issues in dispute; 3. The Tribunal's Decision failed to address the Appellant's submissions concerning Privacy Principles 15 and 16 of the Privacy and Personal Information Protection Act 1998 (NSW) (PIPP Act).
As pointed out by the Respondent, the Appeal Panel rejected all three grounds. The three grounds of appeal essentially involved the proposition that the Tribunal below had failed to consider ss15 and 16 of the PIPP Act.
As the Appeal Panel pointed out at [40], s 15 relates to a situation where a Public Sector Agency withholds personal information and there is a request to amend the information to ensure that it is accurate, relevant, up-to-date, complete and not misleading. The Respondent points out that the allegations of breach of s 15 could only be of relevance if there was personal information as defined in s 4 of the PPIP Act being held by the relevant Public Sector Agency.
The Respondent refers to the finding of the Appeal Panel that the information complained about was not personal information and hence the ground of appeal was misconceived. As the Appeal Panel stated at [43] - [44]: 43 Accordingly, pursuant to s 4(3)(b), personal information does not include information about an individual that is contained in a publicly available publication. It is plain that the information that the Appellants complain about concerning the grounds for refusal to disclose information to the Appellants, was in a publicly available publication, being the previous Tribunal decision. 44 This was part of the findings of the Tribunal below, including in particular at [88] in respect of the slide in question. The Appellants did not seek to appeal this conclusion.
The Respondent in this regard referred to parts of the transcript where Senior Member McAteer stated in clear terms to the Appellants that ss 15 and 16 of the PIPP Act had no relevance to the proceedings.
Accordingly, the Respondent submits that the Appellants ought to have known that their grounds of appeal had no tenable basis in law.
Nextly, the Respondent focussed on what were frivolous or vexatious or otherwise misconceived submissions by the Appellants. The Respondent pointed out that a large portion of the Appellants' submissions made inflammatory and unfounded accusations against the Respondent's employees, with special attention devoted to Mr Tony Wickam of the Respondent.
Some examples of the submissions were given such as that Mr Wickam 'initiated and entered into an unlawful agreement with a member of the public'; 'made false and misleading statements' and 'changed the personal information of the Appellants'.
The Respondent submitted that the Appellants failed to provide any evidence in support of these allegations which were also, apart from being unsubstantiated, of no relevance to the appeal or the appeal grounds put forward by the Appellants.

Appellants' submissions

The Appellants pointed out that they are not that legally trained, qualified, or represented and are non-legal professionals. They also submit that the Tribunal advertises that it facilitates members of the public appearing self-represented. The Appellants contend that it cannot be said that a person who has no legal training can act vexatiously or frivolously.
The Appellants also referred to the disadvantage they suffered dealing with experienced representatives of a government agency. According to the Appellants such self-represented parties are completely intimidated which they submitted is compounded by the fact that the more powerful party has had access to information which the weaker party does not.
In respect of the specifics of the claims made by the Respondent, the Appellants contended that they genuinely believed that the Respondent was making false and misleading claims and that the Respondent has known at all times and continues to know by its agent Mr Wickam that the subject of his presentation of 17 July 2008 was false and misleading.
According to the Appellants, the fact that they have continuously raised serious issues of 'the grossly unprofessional, unlawful and unethical conduct' of Mr Wickam should have 'no bearing on the outcome of an appeal or costs application'.
According to the Appellants whilst they recognise their submissions are 'understandably extremely distasteful for Mr Wickam' they cannot be classified as vexatious conduct.
Nextly, the Appellants submit that the Respondent has not produced a 'Legal Services Tender' or a 'competitive legal services tender' which should be done to get best value for services provided and that as the costs application is the result of a 'handshake agreement at best', the claim for costs is 'completely defective'.
We note that the evidence before us satisfies us that the Respondent has engaged solicitors, being Lindsay Taylor Lawyers, and it has incurred fees to that firm and accordingly we reject the proposition that the costs application by the Respondent is not properly based due to some flaw in the nature of the relationship between the Respondent and its lawyers.
The Appellants submission also contained various complaints made against the Council which are of no relevance to the costs application before us. For example, the Appellants contend that the Respondent is wasting public resources by using lawyers and has a current debt in the amount of $85 million and they submit the Council should not be engaging external lawyers as this is a waste of rate payers' money.
The Appellants even submitted that the engagement of external legal services was designed to set up the putative application for costs. Similarly, we note, the Appellants' submissions included many paragraphs on the question of abuse of process and malicious prosecution which are not relevant.
The Appellants submitted, as we understand their submissions, that the fact that the Respondent did not tender a costs agreement, that it failed to undertake a competitive legal tendering process, or that it failed to use inhouse legal services meant the Respondent's costs application amounted to an abuse of process.
We hold that there is no basis for the suggestion that the Respondent's application for costs was anything other than for the proper purpose of seeking compensation for the amount outlaid on costs in respect of the Appellant's appeal.
The Appellants submitted that the Appeal Panel ought to be satisfied of all of the matters in s 60(3) before being satisfied of the existence of special circumstances. We find that such a construction is not correct. Section 60(3) sets out a non-exhaustive list of matters that the Tribunal 'may have regard to' in respect of being satisfied of special circumstances.
The Appeal Panel may be satisfied of special circumstances if any one or indeed none of the matters set out in s 60(3) are made out.

Consideration

We agree with the Respondent's submissions.
The fact that the Appellants are unrepresented does not render them immune from being found to have pursued frivolous and vexatious or otherwise misconceived proceedings or proceedings that lack substance or that have no tenable basis in fact of law.
Further, an unrepresented litigant, depending on the circumstances, who does conduct proceedings with no tenable basis which are misconceived, or which are frivolous or vexatious and lack substance, may give rise to special circumstances warranting an award of costs.
First, we agree with the thrust of the Respondent's submission that a great deal of the Appellants' submissions on appeal centred upon unsubstantiated and irrelevant allegations being made against Mr Wickam. We note that such unsubstantiated and irrelevant contention persisted in the submissions on costs.
In our view, the Appellants, who are not unintelligent and who were articulate in their oral presentation, ought to have been aware of the lack of foundation of their basal claims of attack on Mr Wickam and also ought to have been aware that such attacks had no apparent relevance to the contention that was being put forward on appeal.
Second, we agree with the Respondent that the Tribunal in the first instance proceedings did patiently engage with the Appellants and pointed out to them the areas of relevance in an application of review of privacy principles under the PPIP Act. This included the fact that for the information in question, being in the public domain, there was no basis under the legislation to seek to correct the information in the way the Appellants wished.
We further note that when this basal proposition was put to the Appellants on appeal, the Appellants stated that, being non-legally trained, they were not in a position to make any submissions on the matter.
For these reasons, we are satisfied that special circumstances have been made out which warrant an award of costs against the Appellants in respect of their appeal.

Respondent's submissions

The Respondent seeks a fixed costs order for $14,000 on the basis that the Respondent's total actual costs are $16,859 including GST.
In this regard the Respondent has filed the legal costs ledger which shows the costs incurred by the Respondent. The Respondent apart from the costs ledger relies upon the evidence of the solicitor, Ms Chenhall, which provides an estimate of the range of a costs to proceed to assessment as being in the range of $3,500 - $7,000. Accordingly, the Respondent submits that given the complexity of the matter, the costs of any costs assessment would be out of proportion to the actual costs sought.

Appellants' submissions

The Appellants did not directly engage with the application for a fixed costs order. The Appellants did however, contend that there was excessive reliance upon senior lawyers and accordingly, the actual costs were excessive.
Again, the Appellants submitted that much of the costs if not all of the costs could have been avoided by using inhouse legal representatives.

Consideration

The power to determine by whom and to what extent costs are to be paid includes the power to make a lump sum or fixed sum costs order: see 203 Castlereagh Street Pty Limited v Skybloo Holdings Pty Limited [2017] NSWCATAP 29 at [35] - [37] (Castlereagh Street).
The Appeal Panel summarised the relevant principles as follows at [40]: 40 These principles, relevantly adapted to the circumstances of the Tribunal, include: 1. A fixed sum costs order involves a departure from the usual process by which costs are assessed in accordance with the statutory procedures now relevantly found in the Legal Profession Uniform Law Application Act 2014 (NSW) (especially Pt 7 dealing with "ordered costs") and the Legal Profession Uniform Law (NSW), eInduct Systems at [8]; 2. A fixed sum costs order may be appropriate where: 1. the sum of costs in question is relatively modest, eInduct Systems at [30]; 2. a party obliged to pay the costs would not be able to meet a liability of the order likely to result from the assessment, Hamod at [813], [816] and [817], eInduct Systems at [30]; 3. the assessment of costs would be protracted and expensive, Hamod at [813] and [817]; and/or 4. the case was complex, Hamod at [815]-[817]; 3. Sections 36(1) and (4) of the NCAT Act (which can be seen as equivalent to those in ss 56(1), 57(1)(d) and 60 of the CP Act) suggest that the following factors merit particular consideration: 1. the relative responsibility of the parties for the costs incurred; 2. the degree of any disproportion between the issue litigated and the costs claimed; 3. the complexity of the proceedings in relation to their cost; and 4. the capacity of the unsuccessful party to satisfy any costs liability, Hamod at [816], Kostov at [22]. 4. An order for fixed sum costs should be based on an informed assessment of the actual costs, having regard to the information before the Tribunal. Furthermore, the approach taken to estimate the costs must be logical, fair and reasonable. This may involve an impressionistic discount of the costs actually incurred in order to take into account the contingencies that would be relevant in any formal costs assessment, Hamod at [820]; 5. The power to make a fixed sum costs order should only be exercised when the Tribunal considers that it can do so fairly between the parties, and that includes sufficient confidence in arriving at an appropriate sum on the materials available, Hamod at [813], Kostov at [23];
We note that the totality of the evidence before us in respect of what would be a fair fixed amount for costs is the 'fee ledger' for work Lindsay Taylor Lawyers have undertaken on behalf of the Respondent. The total amount stated on the fee ledger of $16,859 includes $2,802.50 for work involved preparing the application for costs. The amount proposed is $14,000 by the Respondent.
In our view, the materials before us do not give us sufficient confidence that we are able to make a fixed sum costs order that will be fair and do justice between the parties. For example, we have no evidence from any costs assessor or anyone else as to what may be the likely range of costs that would be awarded on an assessment.
Accordingly, we are left with no feeling of confidence that the amount proposed of $14,000 would represent any real discount on what may occur in a costs assessment.
Accordingly, we decline to make any fixed sum costs order.

Conclusion

Accordingly, we have decided to order the Appellants to pay the Respondent's costs of and relating to the appeal as agreed by the parties and default thereof on assessment.

Disposition

The orders of the Appeal Panel are: 1. Order pursuant to s 50(2) of the Civil and Administrative Tribunal Act 2013 (NSW) that the hearing of the application for costs be dispensed with. 2. Order that the Appellants pay the Respondent's costs of and relating to the appeal as 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

Paragraph 25 - '$5 million' amended to '$85 million' 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: 08 April 2024

At a glance

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Judgment (14 paragraphs)

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Legislation Cited (3)

Cases Cited (15)