Kafataris v Bookmakers & Bookmakers' Clerks Registration Committee (Occupational and Business Regulation) [2008] VCAT 577

1. Respondent to pay Applicant's costs to be taxed in default of agreement on County Court Scale "D", such costs to include reserved costs.
2. Certificate for two counsel for hearing over three sitting days.
3. Liberty to apply.

Dr T McEvoy, instructed by the Victorian Government Solicitor.

1. On 19 September 2007 I made orders in this matter. I found that the decision of the Bookmakers and Bookmakers' Clerks Registration Committee ("the BBCRC") of 31st October 2006 should be set aside, and that the application of Con Peter Kafataris ("Kafataris") to be registered in Victoria as a sports bookmaker should be granted. I reserved the question of any ancillary orders. Pursuant to that reservation, Kafataris now seeks his costs of his successful application.
2. A summary of the litigation history of this matter is as follows. Kafataris issued his application for review of the decision of 31st October 2006 out of this Tribunal on 24th November 2006. Thereafter it went through a number of directions hearings. Those which were the subject of particular attention in the present application were conducted on 2nd April 2007, 14th May 2007 and 29th May 2007. Indeed, the matter had been set down for hearing, with an allocated three days, on 2nd April 2007. A subsequent hearing fixed for 29th May 2007 was also subsequently adjourned. At each directions hearing, counsel represented each party and there was considerable debate and discussion. On 2nd April 2007, 14th May 2007 and 29th May 2007, there was a reservation of costs.
3. The matter ultimately came on for hearing before me on 20th August 2007 and was heard over three days, concluding on 22nd August 2007. Kafataris was represented by Mr M Dreyfus QC, leading Mr R Millar. The BBCRC was represented by Mr P Holdenson QC, leading Dr T McEvoy. Evidence was called from a number of witnesses, and counsel made detailed opening and closing addresses. The matter was fully and vigorously contested, the contest embracing a number of issues including the somewhat complex nature of Kafataris' business enterprises, matters of probity, the application of Acts of Parliament and of rules made by Racing Victoria and the like. It was certainly not a simple matter. As stated, Kafataris was successful. He succeeded in relation to each ground that had been the subject of debate. My Reasons For Decision, being a document attached to the Orders, runs for some 97 paragraphs and I shall not repeat it in any great detail in this ruling.
4. On this occasion, Kafataris was represented by Mr Millar of counsel. The BBCRC was represented by Dr McEvoy of counsel. No evidence was called, although an affidavit of Ms Joanne Maree Kummrow, together with attachments, was filed and served on behalf of the BBCRC. Reference to this, and to other documentary material and authorities, was made in the very helpful and careful submissions of counsel. I shall now summarise those submissions.

1. The submissions of Mr Millar on behalf of Kafataris could be briefly summarised as follows.
2. Whilst the starting point pursuant to s.109 of the Victorian Civil and Administrative Tribunal Act 1998 ("the Act") is that each party bear its own costs, it is appropriate that costs be ordered to the successful party in the present case. In two other cases in the Occupational and Business Regulation List costs have been awarded to the successful party. Those cases are Dias v Psychologists Registration Board [2004] VCAT 1357 and Howell v Psychologists Registration Board [2007] VCAT 65.
3. In the present matter, there are a number of the provisions or exceptions contained in s.109(3) which are applicable and which would justify the awarding of costs. Firstly, s.109(3)(a)(iv) is relevant because on two occasions the BBCRC caused an adjournment. In essence, this was because it wished to rely upon material additional to that which formed the basis of the decision of 31st October 2006. That decision, refusing Kafataris' application for registration, was based upon his business structures and the related issue of who, or which entity, would reap the benefits of any registration. Prior to 2nd April 2007, the BBCRC then broadened the grounds of its objection to include matters of probity and what could be described as the issue of substantial attendance. The introduction of these issues, and the work required to address them, caused the directions hearings and the adjournments. Whatever else, Kafataris is entitled to the costs associated with those directions hearings and adjournments.
4. Further, pursuant to s.109(3)(b), the placing of additional material before the Tribunal unnecessarily prolonged the time required to complete the proceeding. The additional material in relation to probity was the subject of some cross-examination, but effectively was not even addressed in closing submissions. The question of probity was dealt with and discarded summarily in the Reasons For Decision. Thus, these matters made preparation more expensive, prolonged the hearing, and ultimately were of no assistance to the Tribunal.
5. Turning to s.109(3)(c), the case of the BBCRC was weak. Kafataris had a comprehensive victory, succeeding on all issues in dispute whether they be of fact or of law. In essence, the reasons of the BBCRC for refusal of Kafataris' application were found to be without substance.
6. In addition, the nature and complexity of the application are such as to attract the operation of s.109(3)(d). Considerable evidence was placed before the Tribunal, including technical reports and evidence from experts. Some of that material did very little to assist the Tribunal in its deliberations.
7. In summary, Kafataris is entitled to his costs. They should be on the Supreme Court Scale, or, if not, at least on County Court Scale "D". The costs awarded should be in relation to the entire proceeding, but, as an alternative, Kafataris is at least entitled to his costs in relation to the directions hearings and adjournments which occurred.
8. I should add that, at the end of submissions from both counsel, I raised the topic of s.109(3)(e) and factors which might be considered relevant, this aspect of the costs application not having been touched upon. The submissions of Mr Millar in this regard were that relevant factors included the manner in which the case had been conducted, its adversarial nature, and its complexity.

1. The submissions of Dr McEvoy on behalf of the BBCRC could be summarised as follows.
2. Pursuant to s.109(1) of the Act, and its objects and purposes, each party should bear its own costs. In that regard, reference is made to the decision of Morris J in Stonnington CC v Blue Emporium Pty Ltd [2004] VCAT 1441. In addition, there is nothing to distinguish matters brought in the Occupational and Business Regulation List from other matters brought before VCAT. In order for costs to be awarded, the situation must fall within one of the sub-sections of s.109(3). It must also be fair so to do.
3. The costs application insofar as it relies upon s.109(3)(a)(iv) is totally misconceived. It was the application of Kafataris that all matters pertaining to his registration be heard together, rather than those relating to his business structure be dealt with and then there be a further hearing or application in relation to matters of probity and substantial attendance. The first adjournment was in fact granted upon the application of Kafataris, who was desirous of having all aspects of the application heard at the one time and needed an adjournment for the purposes of preparation. The second adjournment resulted from the Tribunal's agreeing with the proposition that there should be only the one hearing, and the outcome of an appeal in New South Wales which was still awaited, this having some bearing on matters of probity. Accordingly, neither adjournment was caused by the conduct of the BBCRC, which had not agreed to the proposition that all aspects of the matter should be heard at the one time, but resulted from a combination of an application by Kafataris for an adjournment and the determination of the Tribunal that it was preferable that all aspects of the matter be heard at the one time.
4. For the same reasons, insofar as Kafataris' application relies upon s.109(3)(b) it must also fail. The BBCRC had warned Kafataris that the hearing of all aspects of the matter at the one time would prolong it, but it was the desire of Kafataris, a desire accepted by the Tribunal, that the case should be conducted in such fashion. Accordingly, the BBCRC cannot be held responsible for any prolongation of the hearing, even assuming that such did occur.
5. The factual context in which cases such as Dias were decided is totally different from that which exists in the present case. Here, there has been no failure to call witnesses, make available witness statements or the like. Such cases are not to the point. The application should be dismissed.
6. As indicated, I also discussed the possible relevance of s.109(3)(e) with Dr McEvoy, it not having been raised during his submissions. It was his submission that there was nothing of relevance which would invoke the operation of that sub-section, particularly bearing in mind s.109(1), and the objects of the Act. Section 109(3)(e) could not be invoked so as to overcome the general intent that each party bear its own costs unless there were obvious and compelling reasons why this should be so.

1. Some further discussion took place. However, this was primarily focussed upon the issues of the directions hearings and adjournments referred to above, and responsibility for the placing of all relevant matters before the Tribunal. As shall now be discussed, those matters have little impact upon my ruling.

1. As I indicated from the bench at the conclusion of submissions, my preliminary feeling, and it was no more than that, was that Kafataris would either receive his costs in toto, or he would be awarded none. My preliminary feeling was that the alternative orders sought by Mr Millar, whereby Kafataris at least received his costs in relation to the relevant directions hearings and adjournments, were not appropriate. After reviewing the material and refreshing my memory of what occurred, that preliminary feeling has become a firm opinion.
2. The arguments advanced by both counsel in relation to these directions hearings and adjournments each contain merit. However, the bottom line is that effectively I ruled that it was more appropriate for all matters pertaining to the application of Kafataris to be registered as a sports bookmaker to be dealt with at the one hearing, rather than dealing only with the question of the financial structure and then dealing with questions of probity and substantial attendance at some future date. Counsel for Kafataris persuaded me that such a course was the preferred option. Once that was the situation, some delay was encountered whilst certain matters pertaining to probity, and which had arisen in New South Wales, were clarified and determined. In my opinion, the directions hearings and the adjournments simply form part of what could be described as the interlocutory process, and need not be singled out for particular attention. In other words, the reserved costs associated with them should simply become part of costs in the cause if Kafataris is awarded the costs associated with his application, or should not be awarded in his favour if he is not otherwise entitled to costs. There is nothing relating to them which specifically requires costs to be awarded in favour of Kafataris regardless of the overall success of this application.
3. Thus, the question is whether Kafataris is entitled to his costs pursuant to s.109 of the Act. For reasons similar to those just expressed in relation to the directions hearings and adjournments, in my opinion s.109(3)(d) does not assist Kafataris in overcoming s.109(1). If there was prolongation of the completion of the proceeding, and in my opinion any such prolongation would not have been great, it was because all relevant matters were dealt with at the one hearing, and this was the result of my determining that this was the way in which the matter should be conducted. It may be that, viewed one way, the additional matters were introduced by the BBCRC, but that body argued, unsuccessfully, that only the question of financial structures should be heard. I do not find that the BBCRC was responsible for unreasonably prolonging the time required to complete the proceeding.
4. I also reject the argument of Mr Millar based upon s.109(3)(c). It is true that Kafataris had a comprehensive victory. However, it could not be said that the case advanced by the BBCRC had no tenable basis in fact or law, or that its case was so weak as to attract the operation of s.109(3)(c). This was a complicated matter which, understandably, warranted the retaining of senior counsel by each party. There was expert evidence. There were detailed submissions. My decision was reserved whilst I considered the competing arguments, and a ruling of some length was required. The fact that one party was ultimately successful in relation to the arguments advanced does not automatically mean that the strength of the claim of the other party was so weak as to attract the operation of s.109(3)(c). I am not persuaded by arguments based upon that provision.
5. That brings me to s.109(3)(d) and (e). In my opinion, a consideration of these provisions leads to the conclusion that, despite the general approach or presumption set out in s.109(1), Kafataris is entitled to his costs.
6. Dealing firstly with s.109(3)(d), as I have stated, this was indeed a complex matter. I have already touched upon this in paragraph 3 of these Reasons. As to its nature, as I stated in my original Reasons For Decision, Kafataris is involved in one of the biggest bookmaking operations in Australia and with international connections. His proposed registration as a sports bookmaker in Victoria was thus a question of some considerable significance. As I have stated, it is a matter which fully warranted the retention of senior counsel by each party. Indeed, this was one aspect of Mr Millar's proposed orders that was not controversial.
7. In relation to s.109(3)(e), the discretion given to the Tribunal is a broad one. In my opinion, relevant factors which were present in this case include the following:-

(i) Each side was represented by senior and junior counsel;

(iii) The manner in which the hearing was conducted was one far more similar to the way in which litigation would be conducted in a court than to the manner in which many cases are conducted before this Tribunal;

(iv) An issue of considerable significance and importance was involved.

Thus, when one considers the factors raised pursuant to s.109(3)(d) and (e), and there is considerable overlapping, it seems to me that what could be described as the presumption pursuant to s.109(1) has been displaced. Kafataris is entitled to his costs, including those reserved costs which have effectively become costs in the cause.

1. Finally, I turn to the question of the scale of costs. Mr Millar urged that costs be on the Supreme Court Scale. Dr McEvoy opposed this position. It is difficult to fix upon a scale based upon the potential quantum involved, but I accept that the amount at stake would be substantial. Viewed another way, what was involved was merely a question of registration, albeit a complex and significant one. On balance, I am of the view that the appropriate scale is County Court Scale "D". That seems to me to be appropriate for an important matter of this kind which involves matters of principle and, potentially, a very considerable amount of money.
2. Accordingly, it is my ruling that the Respondent, the BBCRC, pay the costs of the Applicant, Kafataris, on Scale "D" of the County Court Scales, to be taxed in default of agreement, and such costs to include reserved costs. I certify that this was a proper matter for the retaining of two counsel and, should it be necessary, that the ultimate hearing involving both counsel was conducted over three sitting days. I shall also reserve liberty to apply generally, but also in the event that any further clarification of these orders is required.