On 6 July 2021, for the reasons then given by the Panel, the order for costs made by the Tribunal in its Consumer and Commercial Division on 10 March 2021 was quashed, pursuant to s81(1) of the Civil and Administrative Tribunal Act 2013 (NSW) ("the NCAT Act").
Pursuant to the orders of the Appeal Panel of 6 July 2021, the Appellant sought an order for the costs of the appeal. The Appeal Panel made directions for submissions on costs, and for the parties to address whether the issue of costs could properly be determined on the papers, and a hearing dispensed with. The Respondent filed submissions on 28 July 2021 opposing the making of any order for the costs of the appeal. On 29 July 2021, the Appellant filed submissions in support of his application for an order for the costs of the appeal. Neither party sought to persuade the Appeal Panel that the issue could not be adequately determined on the papers. We are satisfied that it can be, and will order that a hearing be dispensed with: NCAT Act, s 50(2).
In its submissions, the Respondent asserted that it had not "yet seen any reasons given for the appeal being successful". The Appeal Panel's reasons for its decision were given orally. Each of the parties was in attendance by telephone whilst such reasons were being given. Nothing relating to the delivery of the Appeal Panel's reasons in the appeal impacts upon the current controversy.
The Respondent referred, initially, in its submissions to Rule 38A of the Civil and Administrative Tribunal Rules 2014 ("the Rules"). As is not in doubt, r 38A is preceded and enlivened by the circumstances articulated in r 38, and has no present application. Ultimately, as the Respondent did refer to s 60 of the NCAT Act, and the requirement of "special circumstances" thereby created, nothing turns on the Respondent's misconception with respect to the source of power to make an order for costs.
The Respondent asserted that it had not seen "any claim by the Appellant that such special circumstances exist" as required by s 60 of the Act. The Respondent attached to its submissions a statement by its Chairperson, Ronald Choat, of 21 July 2021. The statement was assertedly to explain why Mr Choat did not provide a copy of the costs application, which was successful before the Tribunal, to the Appellant (paragraph 8). The Respondent further asserted that it had not conducted itself in the proceedings, at first instance or, more relevantly, in the appeal, "in a way that should earn the disapprobation of the Tribunal" (paragraph 9). The Respondent also relied upon the asserted criticism of the Appellant at paragraphs 9 and 10 of the Tribunal's reasons of 25 January 2021. It was ultimately submitted on behalf of the Respondent that the appeal was successful as a result of errors made by the Tribunal, rather than the Respondent, and that the Respondent should not be "penalised for any such errors".
The Appellant asserted that the Appeal Panel would find "special circumstances" as required by s 60 of the NCAT Act. One of the matters relied upon in that context was, correctly as events transpired, the "strong prospects on the appeal" of the Appellant, written submissions in support of the Appellant's grounds articulating the basis of that contention having been filed on or about 21 May 2021.
The Appellant further submitted that the Respondent had no "arguable grounds of defence" to the Appellant's appeal and, in summary, failed to respond to the Appellant's grounds, or submissions in support thereof. It was further submitted that, other than essentially relying upon the matters asserted in its reply to the appeal, unsupported by any evidence, the Respondent did not engage with the appeal process.
It was, properly, conceded that, although the initial error in making the costs order which gave rise to the appeal was an error by the Tribunal rather than the Respondent, the Respondent should have conceded the appeal in circumstances where the error was assertedly "obvious". That contention was supported by the Respondent having known at all times (which is not in contest), that it had not ever given notice to the Appellant of its application for costs nor, in consequence, afforded him any opportunity to be heard in relation to it. Given the time which passed between the making of submissions and the hearing of the appeal, the Appellant asserted that the Respondent had "abundant opportunity" to consider the merits of the appeal and to concede it.
The Appellant further relied upon the Respondent's unsuccessful resistance of the stay application which was heard, and granted, by Deputy President Westgarth on 30 April 2021.
The Appellant further submitted that the statement of Mr Choat was not relevant to the costs application, for reasons set out in his submissions (paragraphs 7, 8 and 9).
The Appellant further submitted that earlier conduct, as found by the Tribunal in its decision of 10 March 2021, was irrelevant for the purpose of the current application.
Section 60 of the NCAT Act provides:
"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."
As observed in Cavers v Gleeson [2021] NSWCATAP 147 at [24], authorities with respect to costs in cases where the issue of costs was at large, subject only to the need for the Court to act judicially, in furtherance of the object of the relevant legislation being applied are not binding on the Appeal Panel in these circumstances. The Panel must be satisfied that there are "special circumstances" warranting an order for costs in favour of either party to justify departure from the ordinary rule that each party pay his or its own costs of the appeal.
Not surprisingly, s 60 of the NCAT Act does not define "special circumstances", but identifies particular matters to which regard "may" be had, and provides that regard may also be had to "any other matter" which is considered to be "relevant". The discretionary nature of the section is readily apparent from the use of "may".
Indemnity costs are awarded by courts only when "exceptional" circumstances are demonstrated: Colgate Palmolive Co v Cussans Pty Ltd (1993) 118 ALR 248. Continuation of proceedings in wilful disregard of the known facts has been held to constitute exceptional circumstances justifying indemnity costs: Fountain Select Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397. It is not in doubt that the respondent knew that it had not informed the appellant of the hearing date of the proceedings in the Tribunal which led to the orders successfully challenged in the appeal in reliance upon the principles of natural justice.
Whilst it could not be said that either party to this appeal prosecuted the appeal, or its resistance, other than diligently, as the Appeal Panel observed in its reasons for allowing the appeal, although the Appellant provided extensive, and appropriate submissions, the Respondent failed to appropriately engage in the appeal process. Despite being directed to do so, the Respondent filed no material in opposition to the appeal, or, with respect, any outline of submissions which could reasonably have advanced the Respondent's defence of the decision of the Tribunal of 10 March 2021. Nor, and again with respect, did the oral submissions on behalf of the Respondent engage with issues in the appeal in a way which was likely to enhance the Respondent's prospects of retaining the benefit of the decision of 10 March 2021.
As the Respondent correctly asserted, and the Appellant acknowledged, the Appeal was allowed because of an error of law by the Tribunal, constituted by the denial of natural justice to the Appellant. With respect to the Respondent, and particularly after the Appellant filed his written submissions in support of the appeal, it ought to have been apparent to the Respondent that, if not inevitable, success on the appeal, at least in relation to the natural justice ground advanced by the appellant, was highly probable.
The Respondent's continued resistance to the appeal, combined with its failure to advance any contentions which could have resulted in the rejection of, at least, the natural justice challenge, is a matter to which regard is appropriate. In our view, this factor falls comfortably within the ambit of s60(3)(c) and, to the extent that the Respondent's resistance of the natural justice challenge raised in the appeal was "misconceived or lacking in substance", arguably within s60(3)(e) of the NCAT Act.
For the reasons recorded above, we are satisfied that the Appellant has established "special circumstances" within the meaning of s60 of the NCAT Act, that warrant an order for costs on the ordinary basis.
[2]
I hereby certify that this is a true and accurate record of the reasons for decision of the New South Wales Civil and Administrative Tribunal.
Registrar
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
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: 12 August 2021