APPLICANTS Peter Gorey and Arlene Gorey (Adjoining Property owners)

RESPONDENT Frank Cheng (relevant building surveyor)

INTERESTED PARTIES Qian Zhu and Hanlei Xu (Building Site owners)

CITATION Gorey & Anor v Cheng [2025] VBAB 100

Having considered all the submissions and information placed before it, the Building Appeals Board determines that:

1. Pursuant to sch 3, cl 16(2) to the Building Act 1993, the application by the Applicants for their costs of the proceedings to be paid by the Respondent is refused.
2. The proceedings are otherwise dismissed.

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1. These appeal proceedings were commenced by the Applicants on 23 December 2024. On 13 May 2025, the Building Appeals Board (BAB) granted leave to the Applicants to withdraw their appeals and made further orders giving the parties liberty to make an application for costs.
2. The Applicants, being the adjoining property owners, made an application for an order that the Respondent pay their costs of the proceeding (the Costs Claim). To that end, the Applicants rely upon the following material:

(a) written submissions dated 23 May 2025;

(b) two affidavits of David John McKenzie also dated 23 May 2025;

(c) an affidavit of David Johnson dated 23 May 2025;

(d) an affidavit of Peter Gorey all dated 23 May 2025.

1. In my view, much of what is set out in the above affidavits relates to the factual background underpinning the proceedings, including the interaction between the Applicants and the Interested Parties or their consultants; and the costs which the Applicants incurred in responding to the proposal for protection work as detailed in the Form 7 served on them. Although it is important to have regard to the background facts, it is not clear whether the costs and expenses incurred by the Applicants can be wholly attributed to or characterised as their costs of the proceeding.
2. The Respondent filed a defence to the Costs Claim along with eight appendices
3. I have had regard to the material filed by the parties in determining this Costs Claim.

1. The BAB has jurisdiction to order that one party pay another party's costs of a BAB proceeding. Clause 16(2) of sch 3 to the Building Act 1993 (the Act) states:

The determination may include any order as to costs that the Building Appeals Board, on the application of a party to the proceeding, considers is just.

Unless the Building Appeals Board otherwise determines, a party to a proceeding before the Board must bear his, her or its own costs.

1. In Stewart v Building Practitioners Board & Anor (Stewart decision),[1] Gillard J considered the operation of cl 17 of sch 3 to the Act. His Honour stated:

...It is clear from clause 17 that the Board does have power to make an order for costs. It establishes a general rule, namely, that there should be no order as to costs. But, it is clear that the Board may, in appropriate circumstances, refuse to follow the general rule and make an order for costs. One looks in vain to find any criterion to guide the Board when application is made to override the general rule and order costs.

However, in my opinion, the presence of the general rule requires that circumstances must be established to override the general rule, and that means something more than being a successful party.[2]

1. Therefore, there is no presumption that costs will be awarded to a successful party in a proceeding before the BAB.
2. Accordingly, I approach the question of costs guided by the principle that there must be circumstances which override the general rule in proceedings before the BAB; namely, that the parties must bear their own costs, before it will consider making an order for costs.
3. This approach is consistent with the opinion of Bell J in Martin v Fasham Johnson Pty Ltd[3], in discussing the costs discretion of the Victorian Civil and Administrative Tribunal (another 'bear own costs' jurisdiction). In that case, his Honour stated that:

...The discretion must be exercised judicially, which means that the Tribunal must act fairly, impartially and by reference to relevant considerations and not arbitrarily, capriciously or by reference to irrelevant considerations and not in a manner that frustrates the legislative intent.

The Tribunal is a creature of statute and, on the question of costs, it commences from a different starting point. Usually parties must bear their own costs, which no doubt reflects the general object of the Act. That object...is to promote access to justice generally and to minimise the overall level of costs in tribunal proceedings as far as practicable.[4]

1. Although cl 16(2) of sch 3 to the Act does not give any guidance as to what circumstances an order for costs is considered just, as the Supreme Court made clear in the Stewart decision, there must be circumstances that justify overriding the general rule that the parties bear their own costs.

Are there circumstances that justify overriding the general rule that the parties bear their own costs?

1. The Applicants submit that they were 'completely successful' in prosecuting their appeals. For the reasons which follow, I do not accept that proposition. First, the Applicants describe the second appeal made under s 141(b) of the Act as an 'application in relation to the failure of the RBS [5] to determine the emergency protection works was required'.[6] That characterisation is incorrect. An appeal under s 141(b) of the Act is an appeal against a decision of the Victorian Building Authority (VBA) to make an emergency declaration under s 89 of the Act. There is no evidence that the VBA (as it then was named) made any declaration, which could be the subject of review under s 141(b) of the Act. Indeed, the VBA was not a party to the proceedings. Second, there has been no final determination made by the BAB, as both appeals were withdrawn pursuant to orders made on 13 May 2025. In other words, there has been no curial consideration or determination of the merits of the appeals.
2. Notwithstanding the above, merely being successful in a proceeding before the BAB does not necessarily justify an order for costs. There must be something more than merely being successful.
3. The applicants submitted that an application for costs was warranted because the Respondent cancelled the determination made under s 87 of the Act on 18 December 2024, rendering the appeals otiose. It appears from the material filed that the decision to cancel the determination made under s 87 of the Act occurred because the design of the building works was substantially amended, with the result that protection work was no longer required.
4. In my view, redesigning the building works was a matter within the provenance of the Interested Parties, not the Respondent. It was the Respondent's statutory function to respond to the amended design and to determine whether, in light of that amended design, protection work was still required. This is not a situation where the Respondent simply 'changed his mind', even if that was permissible under the Act.
5. To be clear, it was the amendment to the design of the building works which precipitated the Respondent's decision to cancel the s 87 determination, given that it had no relevance to the amended design. Had that action not been taken, the proceedings would have continued without any utility being served and the parties would have incurred additional costs for no purpose. In my view, the Respondent acted appropriately in cancelling the determination made under s 87 of the Act after the design of the building work was amended by the Interested Parties. It was the Interested Parties' decision to amend the design of the building work which ultimately made the appeals otiose and was the catalyst for the Applicants seeking leave to withdraw those appeals.
6. In my view, there are no other matters raised by the Applicants which would otherwise justify departing from the general rule that each party must bear their own costs in proceedings before the BAB.
7. For the foregoing reasons, the Applicants' application that the Respondent RBS pay the Applicants' costs of the proceeding will be refused.

[1] [2001] VSC 349.

[3] [2007] VSC 54.