1. The Applicant has provided the following submissions in support of the claim:

(a) Protection work was required to his property as the land being developed next door had a two-level basement car park to be constructed on the property boundary.

(b) A negotiated agreement for protection work and license agreement was drawn up whereby a combination of cash payment and physical works between the Applicant and Cobild. Whilst the license agreement was with Cobild, for necessity as they required the access, the understanding was that Milieu were fully funding the payment (no mention or representation of Lygon Street Land (LSL) being the owner was made to the Applicant until the proceeding was commenced). The license agreement and expected building works were from July 2021 to January 2023. There was a clear end date, no attempt was made to extend that date as was provided for in the license agreement. The complainant fully accepted that the compensation was fixed to those dates and covered the "irritation or the annoyance of spending time having to deal with the protection works" and "time taken to review the initial protection works" Ryan v Gracievski.

(c) The protection work extended significantly past any reasonable time and no agreement was reached in relation to the original agreement. The works only required a few days to undertake in total and could all have been reasonably undertaken within 1 week of the email sent by the Applicant given Cobuild had possession of the site. If the Applicant had been aware of the time frames, he would have sought additional compensation.

(d) The Applicant experienced inconvenience, being inability to complete garden, commence demolition and removal of damaged rear fence, plan for construction of a garage and completion of his garden to the front. The voice which remained was steep and he had fears the property could experience land slip.

(e) The Applicant's inconvenience also extended to the community group he is involved in. The community group grows native plants and sells them at cost to provide cheap indigenous plants so that residents can plant out nature strips and gardens to increase biodiversity for native plants and animals. As he had lost a significant part of his garden area he could not store as many plants as he had previously and so could not contribute to the group as he had done before.

(f) There were issues in relation to the completion of the work such as the agree height of the scoria. Attempts to resolve the matter failed until the proceeding shad been issued to the BAB.

(g) The Applicant seeks compensation pursuant to s 98 of the Building Act 1993 (Act).

(h) A monthly rate can be deduced and applied to the timeframe from my first email to the final resolution. As the License agreement was for both cash and works, the Applicant's estimate the total compensation to be $50,000. This was to cover a period from July 21 to January 23, which is 19 months therefore the monthly rate is $2,632. The additional time he estimated to be from 8 June 23 to 11 October 24 which is 16 months and so the claim is $42,112. It is important to note that he is not claiming for February 23 to May 23. The additional time taken to complete the works is a normal part of construction, and expected and allowed for by him. The Applicant is claiming for what is not normal.

(i) He had numerous interactions with Cobild during the works, including identifying where the piling contractor had not installed the piles to the drawings and additional ground anchors were required to protect his property. This was missed by Cobild and could have resulted in collapse of the excavation. He also identified to them damage to my house and property which they were unaware of and had to fix. All of these interactions were covered by the licence agreement.

(j) The case of Ryan v Gracievski denied the claim. He would like to point out the differences in my circumstances to that case. That case was talking about the period prior to and during construction whereas I am talking about an unreasonable time post construction to complete the protection works. It cannot be considered that the original amount negotiated could have contemplated and therefore covered the extraordinarily long time taken for Cobild to complete the works. Therefore his claim is for $11,088.00.

(k) In pursuing the claim before the BAB, the complainant has expended $1,037.37 (see items 36, 43, 45-47 and 49).

1. The Second Interested Party provides the following submissions:

(a) The Applicant's submissions are out of scope as the proceeding was withdrawn with the exception of costs. The Directions and Orders permitted costs of the proceeding. Any other costs are out of scope.

(b) The dispute proceeding was limited to (and relief being sought for) a limited scope of works being carryout out as 'agreed to in Q3 and Q4 and to seal any drill holes in an approved manner and to clean my metal wall sheeting at the end'. Q3 and Q4 are references to questions 3 and 4 (and responses by the Second Interested Party) to proposed protection work the subject of protection work notices served in December 2020.

(c) On 11 October 2024 the Applicant email the BAB to say that 'the physical Works had been completed'.

(d) On 15 October 2024 the BAB emailed the Applicant and the other parties to advise, among other things, that based on the Applicant's email and the information provided by other parties the Registry will draft a determination withdrawing the matter except for the question of costs.

(e) The Orders discontinuing or withdrawing the proceeding (save for costs) was made 1 November 2024.

(f) It is submitted that any 'costs of the proceeding' must be limited to costs incurred in the period 16 July 2024 to 11 October 2024.

(g) The majority of the 'costs' claimed ($42,112) in the Costs Claim are not costs of the proceeding, but rather an unjustified and grossly exaggerated claim for compensation under section 98 of the Building Act 1993 (Vic) (the Act) purportedly for inconvenience, loss or damage. It is submitted that these are not costs of the proceeding.

(h) If the Applicant wishes to seek compensation pursuant to s 98 of the Act, then a proceeding needed to be commenced under s 159 of the Act.

(i) The Applicant's own Cost Claim makes an important concession in the final paragraph of the submission, which states that the 'Cost for the proceeding' are $1,037.37. With the exception of the sum of $1,037.37 (but subject to Sections 2 and 3 below) the Applicant is not entitled to claim any further costs.

(j) The Licencing Agreement contains provisions in which claims made by the Applicant are claims arising from rights released (in the sense of being 'fully fulfilled, satisfied and/or discharged') under the Licence Agreement. The Applicant has waived any further right under the Act (including the right to bring this proceeding, under s 155 of the Act and the costs claim) by reason of clause 5(c) of the Licence Agreement.

(k) The claim for costs in the sum of $11,088 for 56 hours works out at an hourly rate of $198. There is no invoice to evidence this amount or basis provided for $198 per hour or whether it includes a GST component. The cost has been claimed regardless of the work performed.

(l) The $1,037.37 was claimed separately.

(m) Paragraph 2 of the Orders requires that a party which makes an application that another party pay their costs of the proceeding serve on the other parties the Costs Claim by 15 November 2024.

(n) The Second Interested Party was not served with the Costs Claim by the Applicant.

(o) The Costs Claim was received by the Second Interested Party from the Respondent on 29 November 2024. Accordingly, the Applicant failed to comply with the Orders.

APPLICANT'S RESPONSE TO SECOND INTERESTED PARTY SUBMISSION

1. The Applicant has provided the following submissions in reply to the Second Interested Party:

(a) In the preamble the Second Interested Party makes the claim that "in relation to the subject matter protection work it is the agent of the First Interested Party". The Applicant notes that the First Interested Party represented itself at the hearing, at which time it made no mention or direction that the Second Interested Party was its agent. And after this, there was no written or verbal correspondence that the Applicant is aware of which provided such direction. Therefore, the Applicant requests that the BAB finds that the First Interested Party has not submitted a response or defence to the Applicants claim.

(b) The Second Interested Party should provide the Licensing Agreement. The Agreement had a set term which expired and the rights and obligations under this deed, including the Licence also expired.

(c) In BAB case no. 453286 and BAB case no. 454344 the BAB noted that the Act compels the BAB to act with as little formality and technicality and with as much expedition as the Act and the circumstances permit. In both occasions the BAB considered it appropriate to make an order to change the nature of the application to include another section of the act and I feel this is appropriate in these circumstances.

(d) If requested, the Applicant is happy to provide an invoice depicting the daily rate. The Applicant has given sufficient breakdown of the calculation of cost per hour and hours spent. The hour rate is his minimum time unit for charging per hour.

(e) All parties were emailed confirming that the submission had been filed on e-brief, no party responded to deny that e-brief could not be accessed.

SECOND INTERESTED PARTY'S RESPONSE TO THE APPLICANT

1. The Second Interested Party provided the following submissions:

(a) The Applicant Response has admitted that justification is lacking and suggests that it is a matter for the other parties to provide a detailed costing. That submission must be rejected by the BAB. It is not for respondents to make out an applicant's case.

(b) The Applicant has not itemised the amount claimed. The failure to do so is fatal to the claim.

(c) The BAB should be satisfied that in the light of the submissions before the BAB, other than the sum of $1,037.37 the Applicant:

(i) has not met the requirements of the Board's orders;

(ii) has not discharged his burden of proof to substantiate an entitlement to costs; and

(iii) does not have an entitlement to any, or to make claims for any, other costs.

(d) The Applicant's 'Response' identified that the BAB, in case no. 453286 and case no. 454344 'considered it appropriate to make an order to change the nature of the application to include another section of the act'. These decisions determined to allow alternative applications at a stage prior to the application for costs of and incidental to the proceeding, as pursuant to the First Orders. These are different circumstances.

(e) It is submitted that the BAB should determine that the Applicant is not entitled to amend the nature of both the costs proceeding, and the section of the Act in which the dispute was brought by the Applicant.

(f) The Licence Agreement was extended by the consent of the parties as late as 30 July 2024.

(g) Further any claim for costs incurred during the period of the Licence Agreement, including without limitation the Applicant's claim for inconvenience costs are to be considered in the context of the waiver in clause 5(c) of the Licence Agreement;

(h) clause 5(c) provides that the Applicant 'waives any further right it may have under the Act, including a right of appeal to the Building Appeals Board'.

(i) The hourly rate is excessive and without justification or evidence. The Orders asked that where applicable, an amount should have reference to a court scale. The Applicant has not done this.

(j) The notes in the Orders clearly state that the parties must agree as between themselves that viewing the material on e-brief would be effective service. There was no such agreement.

1. Having considered all the material including the submissions filed by the parties, I make the following findings and observations.
2. The BAB's Practice Note 9A - 2023 provides guidance in respect of applications for costs of and incidental to the proceeding of the BAB. The Practice Note defines those costs as usually meaning:

[M]oney paid or liabilities incurred for professional legal services and out-of-pocket disbursements or expenses, such as filing fees, expert witness fees, et cetera, where directly related to the proceeding before the Board.

1. As part of any consideration on whether an order as to costs would be 'just' in the circumstances, I may review the party's conduct during the proceedings. Further, I may have regard to factors which support an award of costs in other jurisdictions which are typically 'bear own costs' jurisdictions.
2. I consider it would be of assistance to outline those factors which might support an award for costs prior to considering the substantive application for costs brought by the Applicant.
3. I note that in the submissions made by the Applicant a claim for compensation is asserted pursuant to s 98 of the Act for loss and inconvenience. However, the proceeding was brought under s 155 of the Act and then withdrawn save as to costs. The Directions and Orders dated 1 November 2024 permitting the withdrawal of the proceeding also state that:

...any party that has made an application for an order that another party or parties pay their costs of the proceeding must file with the Building Appeals Board (BAB) and serve on the other parties a document entitled Costs Claim.....

1. These Directions and Orders only allowed an application for the costs of the proceeding under cl 16(2) of schedule 3 of the Act rather than costs incurred or claimed under s 98, 155 and 159 of the Act.
2. I accept the Applicant attempted to clarify this issue by email dated 11 October 2024 to the Registry of the BAB. He received a response on 15 October 2024 which referenced cl 16(3) Schedule 3 of the Act. I further accept that the Applicant may have been seeking information directed more towards a compensation claim pursuant to s 98 of the Act rather than costs of the proceeding. However, there is no prejudice to the Applicant as the Applicant is still able to refer such a matter and would always have had to refer such a new application to the BAB to enliven jurisdiction.
3. The Second Interested Party notes the costs of the proceeding are more limited in scope than the costs of inconvenience and delay as claimed pursuant to s 98 of the Act. The Second Interested Party notes the Applicant has neither established an entitlement to claim costs of the proceeding or the amount of costs claimed.
4. The parties do not dispute the BAB can consider an application for costs of the proceeding pursuant to cl 16(2) of Schedule 3 to the Act.
5. The parties are in dispute regarding the application of a Licence Agreement to either a claim under s 98 or cl 16(2) of Schedule 3 of the Act.
6. I confirm, from a starting premise, that costs may be sought even in circumstances where the substantive proceeding has been withdrawn.
7. I consider it appropriate to address the factors which may indicate it is just in the circumstances to award costs, the impact of the licence agreement on the claim for costs and then the substance of the application for costs itself.

Factors which may indicate it is just in the circumstances to award costs

1. As noted by the parties, the BAB has previously had regard to other jurisdictions which have a 'bear own costs' jurisdiction. In particular, the Victorian Civil and Administrative Tribunal Act 1998 (VCAT Act) which, like the Board, also stipulates the Victorian Civil and Administrative Tribunal (VCAT) as being a 'bear own' costs jurisdiction. Under s 109(3) of the VCAT Act that tribunal may exercise a discretion to award costs after giving consideration to:

(a) whether a party has conducted the proceeding in a way that unnecessarily disadvantaged another party to the proceeding by conduct such as -

(i) failing to comply with an order or direction of the Tribunal without reasonable excuse;

(ii) failing to comply with this Act, the regulations, the rules or an enabling enactment;

(iii) asking for an adjournment as a result of (i) or (ii);

(iv) causing an adjournment;

(v) attempting to deceive another party or the Tribunal; and

(vi) vexatiously conducting the proceeding;

(b) whether a party has been responsible for prolonging unreasonably the time taken to complete the proceeding;

(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 proceeding; and

(e) any other matter the Tribunal considers relevant.

1. Whilst the Board is not bound by these considerations, I am of the view they are relevant considerations, and I may be guided by them in determining whether it would be 'just' to exercise a discretion to award costs.

The impact of the licence agreement on the application for costs

1. I have obtained a copy of the licence agreement and note the following provisions:

Additional Works means any additional works required for the performance of the works as notified to the Owner, and includes without limitation those works set out in Schedule 1.

Protection Works means the work as described and set out in the Protection Works Notice.

Protection Works Notice means the notice from the Contractor dated 12 August 2021 and attached at Schedule 3

In exchange for payment in the amount of $25,000 inc GST (Licence Fee) and successful completion of the works in Schedule 1, the Owner grants, subject to clause 6 of this Deed, an irrevocable licence to the Contract to:

(a) enter and access the property to complete the relevant Additional Works; and

(b) allow the Crane to enter the airspace of the Property

(a) The Owner acknowledges the Protection Works Notice and by execution of this Deed accepts and agrees to its contents.

(b) The Owner acknowledges that it has rights under the Building Act 1993 (Vic), including without limitation Part 7 (Act), arising from the issue of the Protection Works Notice.

(c) The Owner agrees upon execution of this Deed any such rights it has under the Act are fully fulfilled, satisfied and/or discharged and in consideration of, amongst other things, the mutual promises in this Deed, the Owner waives any further right it may have under the Act, including the right of appeal to the Building Appeals Board.

Except where otherwise provided in this deed, the parties' rights and obligations under this deed, including the Licence, shall expire at the expiry of the term unless otherwise agreed in writing between the parties.

7.7 If any provision of the Contract is illegal, void, invalid or unenforceable for any reason all other provisions which are self-sustaining and capable of separate enforcement shall, to the maximum extent permitted by law, be and continue to be valid and enforceable.

1. The Licence granted under the agreement appears to be directed to 'Additional Work' which is particularly defined. Similarly, protection work is separately defined under the agreement. It would be reasonable to conclude the Licence is granted for Additional Work rather than protection work.
2. Clause 5 notes that the Owner (Applicant) agrees that any rights he has under the Act are fulfilled and agrees to waive any rights he may have under the Act including the right of appeal to the BAB.
3. I note that clause 7.7 also provides a severability clause in the event that a provision of the contract is illegal, void, invalid or unenforceable.
4. I note the case of Westfield Management Ltd v AMP Capital Property Nominees Ltd[3] at [29] the Court noted:

...Windeyer J observed in Brooks v Burns Philp Trustee Co Ltd[32] that a person upon whom a statute confers a right may waive or renounce his or her rights unless it would be contrary to the statute to do so. It will be contrary to the statute where the statute contains an express prohibition against "contracting out" of rights. In addition, the provisions of a statute, read as a whole, might be inconsistent with a power, on the part of a person, to forego statutory rights. It is the policy of the law that contractual arrangements will not be enforced where they operate to defeat or circumvent a statutory purpose or policy according to which statutory rights are conferred in the public interest, rather than for the benefit of an individual alone. The courts will treat such arrangements as ineffective or void, even in the absence of a breach of a norm of conduct or other requirement expressed or necessarily implicit in the statutory text.

Some statutes may, by their nature and purpose, more readily suggest inconsistency with an individual's liberty to forego statutory rights. Some statutes which have a regulatory and protective purpose may fall into this category.

1. The Deed references the protection work and states the Applicant will be deemed to accept the Protection Work Notice and its contents on signing the Deed. The Owner (the Applicant) acknowledges his rights under Part 7 of the Act arising from the issue of the Protection Work Notice and that on execution any rights under the Act are fulfilled. Further, that the Applicant waives further rights he may have had under the Act including a right of appeal to the BAB.
2. The context of the Deed clauses suggests this agreement was attempting to confirm agreement to the proposed protection work as required under s 86 of the Act. The Applicant could have rejected the proposed protection work and appealed against any decision of the RBS as to appropriateness but has in fact agreed to the stated proposed work.
3. I note there is no specific reference to the undertaking of the protection work and the right to claim loss or damage arising from same contained within the Deed. The reference made is simply to the Protection Work Notice issued. Accordingly, it does not appear that the Deed shows an intent to contract out of all rights under Part 7 of the Act. Further, the Deed references appeals which can be brought in relation to disputes over a Form 9 determination by a relevant building surveyor. However, claims for compensation are not appeals but are either referred to the BAB as a 'Dispute' (s 155) or applied for under 'Other Proceedings' (s 159).
4. Part 7 of the Act is quite broad and has a clear statutory intent to provide rights to claim by adjoining owners as well as protecting their property. It has a clear protective and regulatory purpose. According to common law principles, this would make it less likely that an adjoining owner could contract out of his or her statutory rights under the Act.
5. Given this, I do not consider that under common law principles or a matter of construction of clauses in the Deed that the Applicant has contracted out of all of his statutory rights arising under Part 7 of the Act. This includes the right to commence a proceeding and/or apply for any costs of this proceeding pursuant to clause 16(2) of Schedule 3 to the Act.
6. Accordingly, I find that the Licence Agreement does not impact on the costs claim brought by the Applicant.

1. It should be noted that of the costs claimed by the Applicant, only the following costs might be categorised as costs of the proceeding:

(a) Solicitors invoice dated 2 May 2024 for $593.17 inclusive of GST

(b) Land data search invoice dated 16 July 2024 for $20.46 inclusive of GST

(c) Filing Fee $376.24

(d) Land data search invoice $7.50 for Owners Corporation

(e) ASIC Company Searches on four companies at $10 each ($40 total) dated 1 September 2024

The two other amounts claimed by the applicant are for compensation which is distinctly different from costs of the proceeding.

1. The Applicant claimed legal fees but did not provide an itemised invoice to allow the assessment of those legal fees. Further, the legal invoice predates the issuing of proceedings by two months which raises doubts that they are costs of the proceedings.
2. The Applicant's principal ground in support of his application for costs is due to the failure of the First Interested Party to complete works agreed on in a Licence Agreement. The Applicant considered the only way to ensure completion of agreed works was to refer a matter to the BAB under s 155 of the Act.
3. As the matter has been withdrawn it is appropriate to note how this may impact a claim for costs of the proceeding within a no costs jurisdiction such as the BAB.
4. In reviewing other no cost jurisdictions, such as VCAT, it is clear that VCAT does have the option to award costs in favour of the other party in circumstances where the Applicant has withdrawn their application pursuant to s 74 of the VCAT Act. Although the BAB does not have a similar express power, there is also nothing contained in the wording of clause 16 of Schedule 3 of the Act which would preclude a claim for costs of the proceeding in the event of a withdrawn application. I do consider however that an award for costs would still be subject to the same condition set out under the Act that it must be just in the circumstances. I note VCAT in Marple v Indigo SC[4] held that:

Whether costs be sought under section 74(2)(b) or section 109, the power to award costs is a discretionary one. Although section 74(2)(b), on its face, does not contain the same constraints as are contained in section 109(3), the Tribunal has previously held that the circumstances relevant to the exercise of the discretion contained in section 74(2)(b) include, but are not limited to, the matters listed in section 109(3). The Tribunal has also held that in considering the matters contained in section 109(3), the Tribunal should also have regard to the provisions of section 109(1) and (2).

Thus, either way, matters such as the nature and complexity of the proceeding, the relative strengths of the claims made by the parties and the manner in which the parties have conducted the proceeding, are matters that the Tribunal may properly take into account in determining whether to exercise the discretion and award costs against the Applicants.

1. Further, Deputy President Gibson noted in Wilcon Projects Pty Ltd v Hobsons Bay CC[5] that:

Section 74(2)(b) is a separate power to order costs on a withdrawal of a proceeding. There is no rule that costs lie where they fall unless the Tribunal considers it fair to order otherwise, such as applies under section 109 of the Victorian Civil and Administrative Tribunal Act 1998. The Tribunal has an unfettered and broad discretion as to costs under section 74(2)(b). A decision as to costs must depend on all the circumstances of the case. The power to award costs under section 74(2)(b) is governed by the overarching obligation on the Tribunal to act fairly and according to the substantial merits of the case, imposed by section 97 of the Act. For this reason, the Tribunal has held that the issue of costs under section 74(2)(b) must be considered on a case by case basis.

1. In my view, however, the fact that the BAB has not determined the merits of the proceeding would preclude the BAB from making a finding of costs on a merits-based ground. The approach in the VCAT jurisdiction appears to have similar limitations as indicated in the case of JD AC Nom Pty Ltd v Greater Geelong CC,[6] which held:

Ultimately, the Applicant lodged VCAT Application P974/2021 on the basis of the 6.07 metre wide easement proposal and the amended condition 14 statement and, no longer needing VCAT Application P1605/2020, sought leave to withdraw that proceeding.

Whilst this series of events seems to suggest that the Respondent was correct in its assertions regarding the technical issues with the former condition 14 (as well as whether there was a need for the 45 metre wide easement proposal) and what the Applicant was seeking to do, the Tribunal has not made any findings as to the jurisdictional matters raised by the Respondent. In the circumstances of this case, it would not be appropriate for the Tribunal to come to conclusions as to the jurisdictional issues in the absence of making findings in this respect.

I distinguish this from other instances where it might not be inappropriate for the Tribunal to draw a conclusion where an application has been withdrawn that goes to the question of costs. For instance: a council lodging an application for enforcement order in respect of a person undertaking a use on land without the requisite planning permission, in circumstances where the council had previously, repeatedly, communicated with the person of the need to obtain a planning permit, but it was not until the lodgement of enforcement proceedings that the person lodged a planning permit application with the council. The council then seeks to withdraw the enforcement order application on the grounds that it is no longer required. In a situation like that, the Tribunal might be minded to award costs in favour of the council, even though it had not made any finding that a breach had occurred, mindful of the alleged breach, what can be inferred from the person's application for planning permit and the council's statutory duty to enforce the planning scheme.

However, this is a different situation. I do not think it would be appropriate for the Tribunal to award costs on the basis that the changes made to the original statement in condition 14 in any way 'prove' that the Respondent was correct in its allegations regarding technical deficiencies in the original statement. The Tribunal has not made any findings in relation to that matter.

1. I cannot make a finding on the substantive claim made by the Applicant as it was withdrawn. This would be a precondition of a finding in favour of a costs claim which is prosecuted on the basis that the Interested Parties had delayed complying with their obligations under the Licence Agreement.
2. Although I may consider other grounds in the Application for costs which relate to the process undertaken in issuing and prosecuting the claim, the Applicant has not provided any grounds unrelated to the substantive ground for commencing the proceeding. As I have not made findings relating to the merits of those grounds, it follows I should not grant costs in relation to those grounds.
3. I find that the Applicant has not established that it would be 'just in the circumstances' to permit the award of costs of the hearing in circumstances where the Interested Parties have settled the claim. The Interested Parties have not created delays or additional costs during the period of time the proceeding was at the BAB which might otherwise give rise to a successful claim for costs.
4. The above findings and orders relate to the costs of the proceedings and not to any separate claim made under s 98 of the Act. This determination does not bar the Applicant from any rights to bring such a claim.

[1] Stewart v Building Practitioners Board and Anor [2001] VSC 349.

[2] Martin v Fasham Johnson Pty Ltd [2007] VSC 54.

[3] [2012] HCA 54.

[4] [2016] VCAT 1618 [28]-[29].

[5] [2019] VCAT 190 [13].

[6] [2021] VCAT 1519 [108]-[111].