Juskey v The Owners – Strata Plan No 62732

1. A brief background of the proceedings between the parties is set out below.
2. Ms Juskey is the owner of a lot in a 6 lot strata scheme. Mr Juskey resides with her in the lot and was also a strata committee member.
3. The appellants filed an application in the Consumer and Commercial Division of the Tribunal on 2 December 2022 seeking orders under the Strata Schemes Management Act 2015 (NSW) (SSM Act) against the respondent in relation to a partially collapsed boundary retaining wall and fence located in an area proximate to Ms Juskey's lot.
4. The appellants sought orders that the retaining wall be repaired according their proposed design; payment of damages under s 106(5) of the SSM Act (for costs including various quotes and expert reports they had obtained in respect of their proposed design); an order limiting the amount Ms Juskey would be levied for the repair works; and costs (in respect of legal advice previously obtained).
5. The Tribunal application was listed for hearing on 22 February 2023 before Ellis SC SM. The appellants appeared self-represented, with Mr Juskey presenting the appellants' case. The respondent was, pursuant to a grant of leave by the Tribunal under s 45 of the NCAT Act, represented by Mr Ton, Solicitor, of Grace Lawyers.
6. At the hearing, the respondent did not dispute that repairs needed to be performed.
7. However, it asserted that it had approved repairs and was ready, willing and able to have the repairs performed, with the inability to perform the repairs arising from the appellants refusing to give reasonable access to their lot by reason of the appellants disagreeing with the respondent's scope of works. The respondent sought that the Tribunal make an order that the appellants give access to their lot so that the repairs to the retaining wall and fence could be performed. The respondent also asserted that the appellants had conducted previous unauthorized works involving the retaining wall and fence. The appellants disputed that they had performed unauthorized works.
8. The Tribunal decision was given on 28 February 2023. The decision comprises 16 pages of written reasons.
9. Orders were made by the Tribunal as follows:

(1) The applicants are to provide access to the respondent, its strata managing agent, strata committee members, experts, contractors, and agents, provided 48 hours' written notice is provided (which notice may be provided by email), in relation to work on the retaining wall and/or fence on the western boundary of the land covered by the strata plan number 62732.

(2) The applicants are not to interfere with or hinder in any way any person carrying out work in accordance with Order 1.

(3) Without prior written approval of the respondent or its strata committee, the applicants are not to carry out any work on the common property or near the retaining wall and/or fence until the work carried out in accordance with Order 1 is completed.

(4) The application is otherwise dismissed.

(5) Each party is to bear their own costs of the application.

1. Detailed written reasons were given by the Tribunal for the decision.
2. In substance the Tribunal was satisfied as follows:

(1) There had been no breach by the respondent of its duty under s 106(1) or (2) of the SSM Act to keep and maintain common property in a state of good repair. It is for the owners corporation, not an individual lot owner, to determine an appropriate scope of works to repair common property (citing The Owners-Strata Plan 32735 v Lesley-Swan [2012] NSWSC 383 at [181] and The Owners Strata Plan No 6534 v El Khouri [ 2015] NSWCATAD 145 at [74]);

(2) It was clear the wall and fence required rectification;

(3) The rectification work was delayed by the conduct of the appellants who preferred a different design;

(4) There could be no recovery of amounts claimed by the appellants under s 106(5) of the SSM Act where there had been no breach by the respondent of its duty under s 106(1) or (2);

(5) It was appropriate to make an access order to facilitate the repair work being performed;

(6) It was appropriate to make an order restraining the appellants from carrying out work on or near the subject boundary wall and fence in circumstances where the Tribunal was satisfied that the appellants had previously performed unauthorised work.

(7) There were no sufficient 'special circumstances' to depart from the principle under s 60(1) of the NCAT Act that each party bear its own costs.

1. On 17 October 2023, the appellants filed further Tribunal proceedings pertaining to the dispute about the retaining wall and fence. Those proceedings were withdrawn on 18 March 2024.
2. In August 2024, after involvement of the local Council, the respondents demolished the old retaining wall and constructed a new retaining wall and fence pursuant to earlier remediation orders of the local Council. There was a subsequent complaint by the appellants regarding the existence of asbestos in the area where the works were performed, but it unnecessary to explore that complaint in the context of the appeal proceedings and this costs application.
3. On 9 September 2024, the appellants filed the Notice of Appeal, being an internal appeal pursuant to s 80(2) of the NCAT Act. A stay application was also filed. The respondent submits that there are other Tribunal proceedings involving the parties, that are separate to the appeal proceedings.
4. On 12 September 2024, Harrowell DP when setting the appeal down for a call over, and hearing of the stay application, stated the following in the orders and directions:

"This appeal concerns a decision made on 28 February 2023 and has been lodged well beyond the 28 day limit to do so. No evidence is provided to support an ex-parte stay and directions are made to permit the parties to file and serve relevant submissions. The Tribunal may also consider the extension of time application at the call over on 27 September 2024 due to the extreme lateness of the appeal. The parties should deal with this matter and provide evidence and submissions as appropriate."

1. On 20 September 2024, the respondent's Solicitor sent an email to Mr Juskey that set out in detail:

(1) The appeal and stay application were significantly out of time and had no prospects of success.

(2) There was no likely basis for the Appeal Panel granting an extension of time to file the appeal.

(3) The respondent would suffer "significant prejudice" if an extension was granted, as the retaining wall and fence had now been constructed.

(4) The appellants had not provided details of their other Tribunal proceedings, which were relevant to the appeal and the issue of whether time would be extended.

(5) The respondent had incurred significant legal costs defending the Tribunal proceedings and would incur further costs if the appellants proceeded with the appeal.

"...

For the reasons set out in this email, we would contend that you do not satisfy the criteria that would allow for an extension of time.

Considering our client is required to put on its reply to the appeal and evidence in response to the stay application by 25 September 2024, we put on you on notice that if you do not withdraw the appeal by 10 am on 24 September 2024, our client will prepare its evidence and opposition to your appeal and stay application and in support of an application that the appeal will be dismissed immediately.

Our client will then rely upon this letter on the question of costs.

..."

1. The call over directions hearing of the appeal occurred on 27 September 2024. The parties were directed to provide documents and submissions for the appeal. The stay application was dismissed.
2. Documents and submissions were provided by both parties.
3. The appeal was set down for hearing on 19 December 2024 and on that date, after hearing and consideration of the submissions, orders were made as follows with oral reasons:

1 Leave to extend time to file the appeal is refused.

2 The appeal is dismissed.

3 Costs of the appeal are reserved.

4 Respondent to file and serve, by person or by post, and additionally by email, costs submissions and documents by 30 January 2025.

5 Appellants to file and serve, by person or by post, and additionally by email, costs submissions and documents by 27 February 2025.

6 Respondent to file and serve, by person or by post and additionally by email, costs submissions in reply by 13 March 2025.

7 The costs submission of the parties are to address whether an oral hearing is sought on the issue of costs, or whether costs can be determined on the papers in accordance with s 50(2) of the Civil and Administrative Tribunal Act 2013.

8 Either party has liberty to apply in writing to the Appeal Panel and the other party to extend the timetable for costs submissions and documents.

9 Reasons

Oral reasons were given at the appeal hearing on 19 December 2024.

1. The oral reasons of the Appeal Panel set out why the Appeal Panel was not satisfied that it was appropriate to extend the time to file the appeal under s 41 of the NCAT Act, in circumstances where the appeal had been filed a considerable period beyond the limitation period contained in r 25 of the Civil and Administrative Tribunal Rules 2014 (NSW) (NCAT Rules). Further, as the retaining wall and fence had now been constructed, there would be no utility in allowing the appeal in any event.
2. The respondent filed a submission in support of a request for costs on 30 January 2025.
3. The appellants filed a costs submission in reply on 3 March 2025.
4. The respondent filed a cost submission in reply on 13 March 2025.
5. We have considered these submissions in determining the respondent's application for costs of the appeal. We summarise the submissions as follows.

Respondent's Costs Submissions (Including Reply Submissions)

1. In summary , the respondent submits in support of the application for costs:
2. There are "special circumstances" warranting an order for costs because:

(a) It is out of the ordinary for an appellant to be seeking an extension of time to the extent of 582 days, especially in circumstances where the appellants have exercised their rights in the intervening period in other sets of NCAT proceedings, two of which were still on foot at the time of the respondent's submissions dated 30 January 2025;

(b) 582 days is so out of the ordinary so as to fall within the meaning of special circumstances;

(c) The delay has not been properly explained by the appellants;

(d) The grounds for an extension of time and appeal grounds were exceedingly weak and the appellants were put on notice by the respondent of the difficulties with the extension of time application and at that time should have withdrawn the appeal;

(e) The appellants have unreasonably prolonged the time taken to resolve the dispute which has increased the cost and complexity of the appeal proceedings;

(f) The appellants' appeal submissions were unnecessarily prolix and unfocussed;

(g) The email from the respondent's solicitor to the appellants dated 20 September 2024 confirmed to the appellants that there was a lack of utility to the appeal when the retaining wall and fence had been constructed; and that letter also drew the appellants' attention to the fact that they did not meet the criteria for an extension of time arising the principles in Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22 at [22];

(h) The above matters constitute "special circumstances" and the Tribunal ought exercise its discretion to award costs to compensate the respondent for the needless appeal proceedings;

(i) In reply to the appellants' submissions the respondent says that the suggestion that English is the second language of the appellants is irrelevant and there was no suggestion of disadvantage by virtue of language. The appellants could have but did not ask for an interpreter for either the Tribunal proceedings or the appeal;

(j) The appellants are self-represented but they are not strangers to litigation in the Tribunal having pursued 5 proceedings in the Tribunal against the respondent;

(k) The issue in the appeal was not that the respondent had not constructed the wall but rather the appellants were unhappy with what had been constructed;

(l) A costs order would be compensatory to the respondent and not punitive to the appellants;

(m) The insurance submission of the appellants is unproven and irrelevant;

(n) It is irrelevant that the appellants pay strata levies, as every proceedings between an owners corporation and a lot owner, has the lot owner as a payer of strata levies and therefore this could not be a valid reason to decline a costs application against a lot owner.

1. In summary , the appellants submit in opposition to the application for costs:

(a) It is unfair for the respondent to claim costs when it is already compensated by its insurer;

(b) The appellants have at all times paid strata levies which were used to pay for the respondent's defence and insurance excess;

(c) The delay in filing the appeal is explained as it was only after the respondent started doing the repairs that the need, nature and substance of the appeal became fully apparent as the appellants privacy, property rights and other civil rights were affected;

(d) These rights were important to the appellants and therefore the appeal was critical;

(e) The delay in filing the appeal did not affect the respondent;

(f) The appeal was extremely focused and limited to around 2 hours so there was no prolonging as claimed by the respondent;

(g) English is the appellants' second language and they are self-represented and therefore deserve latitude;

(h) There are no special circumstances;

(i) There was a tenable basis for the appellants to lodge the appeal when it became clear to the appellants that the respondent would not comply with its duties under s 106 of the SSM Act;

(j) The respondent is under a strict duty to repair and maintain common property;

(k) The appellants have filed expert evidence to establish there has been a failure to repair and maintain common property;

(l) This appeal and other proceedings were necessary as the respondent had taken no action since the decision of the Tribunal dated 23 February 2023;

(m) The appellants conducted the appeal reasonably and there has been no capitulation;

(n) The appellants did not prolong the proceedings.

1. By reason of rr 38 and 38A of the NCAT Rules, the Appeal Panel can make a costs order without 'special circumstances' being established if (a) the amount claimed or in dispute in the Tribunal proceedings exceeded $30,000; and (b) the amount claimed or in dispute in the appeal exceeded $30,000 (see, for example, The Owners-Strata Plan No 53865 v JPG Investments Pty Ltd (No 2) [2024] NSWCATAP 67 at [12]- [14]). The respondent made no submission that rr 38 and 38A of the NCAT Rules was applicable to this costs application, and we are satisfied that rr 38 and 38A do not apply.
2. 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.

1. 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 concisely summarised in The Owners - Strata Plan No 63731 v B & G Trading Pty Ltd (No 2) [2020] NSWCATAP 273 at [6]- [15] as follows (footnotes omitted):

"The general rule set out in s 60(1) was:

"... designed to promote access to justice generally and to minimise the overall level of costs in tribunal proceedings as far as is practicable: Choi v University of Technology Sydney [2020] NSWCATAP 18 at [41]. [1]

In Feng v OzWood (Australia) Pty Ltd [2020] NSWCATAP 42 the Appeal Panel said, at [8], that the discretion to award costs had to be exercised judicially:

"...having regard to the underlying principle that parties to proceedings in the Tribunal are ordinarily to bear their own costs. (See eMove Pty Ltd v Naomi Dickinson [2015] NSWCATAP 94 at [48]; CPD Holdings Pty Ltd t/as The Bathroom Exchange v Baguley [2015] NSWCATAP 21 at [23]-[31]; Nguyen & Anor v Perpetual Trustee Company Ltd; Perpetual Trustee Company Ltd v Nguyen & Anor (no 2) [2016] NSWCATAP 168 at [16].)"

Section 60(2) says that the Appeal Panel may award costs to a party "only if" satisfied there are special circumstances warranting an award of costs.

Section 60(3) sets out a non-exclusionary list of factors to which an Appeal Panel may have regard in determining whether special circumstances warranting an award of costs exist.

"Special circumstances" are circumstances that are out of the ordinary, but need not be those which are exceptional or extraordinary: Cripps v G & M Dawson Pty Ltd [2006] NSWCA 81 at [60] (Santow J); Megerditchian v Kurmond Homes Pty Ltd [2014] NSWCATAP 120 at [11]; CPD Holdings Pty Ltd t/as The Bathroom Exchange v Baguley [2015] NSWCATAP 21 at [32]; Commissioner for Fair Trading v Edward Lees Imports Pty Ltd (No 2) [2019] NSWCATAP 222 at [8]; Edwards v Commissioner for Fair Trading, Department of Customer Service (Costs) [2019] NSWCATAP 249 at [9]; Youssef v NSW Legal Services Commissioner (Costs) [2020] NSWCATOD 115 at [107].

However, it does not follow that a costs order should be made simply because one or more of the factors in s 60(3) are made out.

Even if satisfied that there are special circumstances, the Appeal Panel must further be satisfied that they are circumstances "warranting an award of costs" - Fitzpatrick Investments Pty Ltd v Chief Commissioner of State Revenue [2015] NSWCATAD 103 at [21]; Youssef at [108].

The exercise of the discretion requires the Tribunal "to weigh whether those circumstances are sufficient to amount to 'special' circumstances that justify departing from the general rule that each party bear their own costs": BPU v New South Wales Trustee and Guardian (Costs) [2016] NSWCATAP 87 at [9]; Obieta v Australian College of Professionals Pty Ltd (2014) NSWCATAP 38 at [81]; Khalafv Commissioner of Police [2019] NSWCATOD 178 at [29]; Alliance Motor Auctions Pty Ltd v Saman [2018] NSWCATAP 137 at [35].

He who asserts must prove, and so the party seeking the costs order bears the onus of proving that special circumstances exist - Styles v Wollondilly Shire Council [2017] NSWCATAP 108 at [5] under the heading "Costs".

Whether special circumstances exist is a question of fact and each case must be assessed according to its circumstances: Wynne Avenue Property Ltd v MJHQ Pty Ltd (No 2) [2019] NSWCATAP 68 at [57]; The Owners - Strata Plan 20211 v Rosenthal [2019J NSWCATAP 49 at [15]."

1. We are satisfied that the respondent has established that there are special circumstances that justify the exercise of discretion to depart from the usual principle that each party pay its own costs of the appeal under s 60(1) of the NCAT Act.
2. The delay before filing the appeal is substantial and not adequately explained by the appellants.
3. Although the appellants do not have English as their first language and are not legally qualified, we are satisfied that the multiple sets of proceedings they have commenced against the respondent in the Tribunal, meant that they had a sufficient amount of knowledge; could have obtained independent legal advice; and could have made inquiries of the NCAT website or the Appeal Registry as to the time limits for filing internal appeals.
4. The appellants were clearly informed in the email from the respondent's solicitors dated 20 September 2024, issued a short period after the Notice of Appeal was filed, that the appeal grounds did not disclose an error on a question of law or any other appealable error and was an attempt to reargue their unsuccessful case. They were also informed in email that if they persisted with the appeal, costs would be sought by the owners corporation in respect of defending the appeal proceedings.
5. The written orders and directions of the Tribunal dated 12 September 2024 pointed to the lateness of the appeal.
6. The retaining wall and dividing fence had been constructed by the respondent in accordance with advice from an engineering consultant and the respondent was within its rights to choose how to have that wall and fence constructed in accordance with local Council approval, rather than adopt the design and preference of the appellant. Accordingly, an inference can be drawn that the appeal was an avenue for the appellants to continue to press for the design that they preferred and to prevent the respondent from dealing with the common property that it was responsible for. This was not a proper or meritorious basis to bring an appeal.
7. We are satisfied that the prospects of the appellants persuading the Appeal Panel to extend time to file the appeal, and the merits of the appeal, were so poor (s 60(3) (c) of the NCAT Act) as to constitute "special circumstances" and that, in all the circumstances of the appeal, the appropriate exercise of our discretion is to depart from the usual principle under s 60(1) of the NCAT Act that each party pay its own costs. We are satisfied that the appellants being put on notice of the weakness of the appeal and being given an opportunity to withdraw the appeal without the respondent making a costs application is a powerful discretionary reason to make a costs order in all the relevant circumstances.
8. Given the extensive time delay in filing the appeal; the lack of any reasonable explanation for the delay; the merits of the appeal were very poor; the works the subject of the dispute had been completed prior to the filing of the appeal; and the appellants pressed on with the appeal despite the orders of the Appeal Panel dated 12 September 2024 and the email from the respondent's solicitor dated 20 September 2024; it is appropriate to exercise our discretion in favour of allowing the costs application.
9. We regard the period from 10.38 am on 20 September 2024 to 10am on 24 September 2024 as a reasonable period in all the circumstances for the appellants to consider the contents of the email of the respondent's Solicitor; obtain advice; and withdraw the appeal.
10. We agree with the respondent's submission that a costs order may be made irrespective of the fact that there may be some insurance payment and irrespective of the fact that the appellants pay strata levies.
11. We have taken into consideration that English is not the first language of the appellants, and that they are not legally trained. They clearly have strong beliefs regarding the type of retaining wall and fence that should have, in their view, been constructed by the owners corporation.
12. However, weighed against those considerations are a number of salient matters. The appellants had experience as litigants in the Tribunal in other proceedings prior to the filing of the appeal. They were warned by the respondent's Solicitor about the weakness of their appeal grounds and negligible prospects of having the limitation period to file the appeal extended. They were given the opportunity to withdraw the appeal without facing a costs application. Armed with this knowledge, they chose to proceed with the appeal until it was dismissed after a contested appeal hearing.

1. The respondent has satisfied us that (a) there are 'special circumstances' and (b) the circumstances warrant the Appeal Panel exercising its discretion to depart from the usual principle under s 60(1) of the NCAT Act that each party bears its own costs. It is appropriate that a costs order be made in favour of the respondent.

(1) A hearing of the costs application is dispensed with under s 50(2) of the Civil and Administrative Tribunal Act 2013 (NSW).

(2) The appellants are to pay the respondent's costs of 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.