Independent Liquor & Gaming Authority v Hurlstone Park Hotel Operations Pty Ltd

Relevant costs rule and principles

1. The first task is to determine the relevant costs rule. All parties submit, and we accept, that the relevant costs rule is found in s 60 of the NCAT Act.
2. That section relevantly states: 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.
3. The Appeal Panel of the Tribunal has considered on many occasions the applicable principles as to whether there are "special circumstances" to justify a costs order in favour of a party. The principles were summarised in The Owners-Strata Plan No 63731 v B & G Trading Pty Ltd (No 2) [2020] NSWCATAP 273 at [6]-[15] and can be paraphrased as follows: 1. "special circumstances" mean out of the ordinary but not to the degree of being exceptional or extraordinary; 2. a costs order is not made simply because one or more of the circumstances in s 60(3) of the NCAT Act is established. The special circumstances must be sufficient for the Tribunal to exercise its discretion in favour of making a costs order; 3. the party seeking costs bears the onus of persuading the Tribunal that the special circumstances are sufficient to justify departing from the usual principle in s 60(1) of the NCAT Act; 4. the discretion should be exercised judicially, with consideration that the usual principle is that by reason of s 60(1) of the NCAT Act each party bears its own costs, and the Tribunal must be persuaded to depart from that principle; 5. whether there are sufficient special circumstances to justify a costs order is a question of fact and each case must be assessed according to its circumstances.

Submissions

1. We commence by noting that, even though the appellant was the successful party, the respondent HPHO Pty Ltd, the unsuccessful party, sought costs.

The submissions of HPHO Pty Ltd

1. HPHO Pty Ltd sought its costs of proceedings 2023/00035087 on the basis that special circumstances were established warranting an award of costs in the Tribunal's discretion in its favour.
2. In summary, HPHO Pty Ltd submits that the Authority should pay its costs thrown away by the Authority's raising late in the proceedings the jurisdictional point which led to the appeal being allowed and the proceedings below being dismissed.
3. The respondents submit that it was only on the "second last business day" before the Tribunal hearing of Taphouse Investments Pty Limited v Independent Liquor and Gaming Authority [2022] NSWCATAD 255, that the Authority served written submissions that raised for the first time, the proposition that there was no jurisdiction to entertain an appeal by HPHO Pty Ltd from the Tribunal's decision, a point established in Taphouse Investments Pty Ltd v Independent Liquor and Gaming Authority [2023] NSWCATAP 171 (26 June 2023) and subsequently upheld in Taphouse Investments Pty Limited v Independent Liquor and Gaming Authority [2024] NSWSC 240 (13 March 2024)
4. HPHO Pty Ltd submits that there were a number of occasions when the jurisdictional point could have been taken, and say that the Authority's failure: to raise the very same point that it had already raised prior to the proceedings below being fixed for hearing, and fully prepared for hearing, amounts to conduct that led to unnecessary litigation and expense. It unnecessarily disadvantaged [HPHO Pty Ltd] and unreasonably prolonged the time taken to complete the proceedings. Had the point been taken or raised, when the refusal was communicated to [HPHO Pty Ltd] or when [HPHO Pty Ltd] filed the appeal, the costs incurred subsequently would have been avoided.
5. In short, HPHO Pty Ltd submits that the "real issue" was not raised when it ought to have been, with costs wasted as a result.
6. HPHO Pty Ltd submits that special circumstances are established notwithstanding the Authority's success on the appeal. On that basis, it seeks its costs of the proceedings below thrown away by reason of the Authority failing to raise the jurisdictional point until the Thursday before the hearing in October 2023.

The appellant's submissions in response

1. After setting out the various procedural steps in the various "Taphouse proceedings", the Authority submits that: 1. the lawyers for HPHO Pty Ltd in the Taphouse proceedings were the same lawyers as have represented HPHO Pty Ltd throughout the various proceedings; 2. In Taphouse, Mr Orr only ceased to be the licensee after the first instance review hearing in the Tribunal and the issue was then whether it was able to maintain an appeal. Here, Mr Orr was the applicant licensee to the Authority, but had ceased to be by the time of the decision and there had been multiple changes in licensee thereafter. Thus the change in licensee had occurred at a different stage in the process and so raised different jurisdictional issues. Further, in this case HPHO Pty Ltd maintained the position that Taphouse was "clearly distinguishable" on its facts; 3. HPHO Pty Ltd does not identify when it asserts that the Authority ought to have raised a jurisdictional issue. At the time of the commencement of these proceedings (2 February 2023) and the first directions hearing (28 February 2023), the Appeal Panel hearing in Taphouse, at which time the jurisdictional argument in Taphouse was the subject of argument (17 March 2023) had not yet occurred (and Mr Francesco Stramandinoli was the licensee); 4. by the time of the Appeal Panel decision in in Taphouse Investments Pty Ltd v Independent Liquor and Gaming Authority [2023] NSWCATAP 17, being 26 June 2023, in these proceedings HPHO Pty Ltd had already served its substantive evidence in chief. The applicant in Taphouse then filed its Summons in the Supreme Court seeking leave (2 August 2023) shortly before HPHO Pty Ltd served its reply evidence; 5. the jurisdictional issue in Taphouse was relevant to but distinguishable from the issue raised in these proceedings.

Consideration

1. We find HPHO Pty Ltd's costs application to be misconceived. In our view, the application should be rejected and no order as to costs made in conformity with the NCAT Act.
2. The proceedings below were commenced by HPHO Pty Ltd on 2 February 2023. A directions hearing took place on 28 February 2023, at which time directions were given for the service of evidence and submissions and the matter was listed for hearing on 4 and 5 October 2023.
3. On 4 October 2023, the Tribunal adjourned the hearing of the review application pending the determination of the Appeal Panel proceedings.
4. The Appeal Panel proceedings were held on 17 March 2023, with reasons published on 26 June 2023
5. The Supreme Court hearing was held on 2 February 2024 and the judgment published on 13 March 2024: Taphouse Investments Pty Limited v Independent Liquor and Gaming Authority [2024] NSWSC 240.
6. Following that decision, the Authority sought to have these proceedings dismissed at first instance. That application was unsuccessful, but that decision set aside by us in the Substantive Decision.
7. It is against that background that HPHO Pty Ltd now seeks its costs "thrown away by reason of the late raising of the jurisdictional issue by the Authority on 29 September 2023", just shortly before the hearing at first instance.
8. As the Authority submits, HPHO Pty Ltd had lawyers acting for it all times, the same lawyers in all proceedings. More to the point, HPHO Pty Ltd was itself a party in the relevant proceedings. All parties relevantly should have understood the implications of the Appeal Panel and Supreme Court decisions. Had HPHO Pty Ltd turned its mind to those implications, it could have withdrawn its review application, which would have limited its costs to some extent.
9. But we see no obligation on the appellant to have indicated its position at some earlier point in time.
10. It follows that we are not satisfied that HPHO Pty Ltd has established special circumstances. Even if we had, we would have been disinclined to award cots in the exercise of our discretion, given the multiplicity of proceedings involving the Authority and licensees of the of the Hurlstone Park Hotel .

Conclusion

1. For the above reasons, we have concluded that the respondents' application for costs in proceedings 2023/00035087 is dismissed, with the intent that all parties bear their own costs in those proceedings.
2. For completeness, we note that no party sought their own costs in proceedings 2024/00305927. Accordingly, we make no order in the appeal proceedings, again with the intent that all parties bear their own costs.

Other

1. During the course of preparing these reasons we noticed that there was an error in the name of the respondent in the Substantive Decision.
2. Pursuant to s 63 of the NCAT Act we amend the name of the respondent on the cover page of the Substantive Decision so as to read "Hurlstone Park Operations Pty Ltd".

Orders

1. The Tribunal orders: 1. In proceedings 2023/00035087 the respondent's application for costs is dismissed, with the intent that all parties bear their own costs in those proceedings. 2. In proceedings 2024/00305927, there is no order as to costs, with the intent that all parties bear their own costs in those proceedings. 3. Pursuant to s 63 of the Civil and Administrative Tribunal Act 2023 (NSW) the name of the respondent on the cover page of the decision published as Independent Liquor & Gaming Authority v Hurlstone Park Operations Pty Ltd [2024] NSWCATAP 232 so as to read "Hurlstone Park Operations Pty Ltd".

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: 07 February 2025