Komadina trading as We Paint Pools v Kelleher

REASONS FOR DECISION

This is an application for costs made by Deborah Kelleher (the homeowner) against Sam Komadina t/as We Paint Pools (the contractor), arising from an internal appeal under s 80(1) of the Civil and Administrative Tribunal Act 2013 (the NCAT Act) in respect of proceedings HB 17/15866 in the Consumer and Commercial Division, in which the contractor was ordered to pay the homeowner $21,890.00 compensation for the cost of rectifying incomplete and defective home building works, being the repair of an in-ground pool at premises in Blacktown NSW.
In the substantive proceedings, the contractor's appeal was wholly unsuccessful on all grounds. On 3 January 2018 we made the following orders: (1) Leave to appeal refused. (2) Appeal dismissed. (3) The stay of the operation of order 2 made on 2 August 2017 in HB 17/15866 is lifted. (4) If either party seeks costs of the appeal, leave is granted to file and serve a short written submission on that issue within 14 days of the date of this decision. (5) Leave is granted for the other party to file and serve a short written submission in reply within a further 14 days. (6) Submissions should address the question of whether the Tribunal should dispense with a hearing on the issue of costs, pursuant to s 50 of the Civil and Administrative Tribunal Act 2013.
The background to the substantive application and our reasons for the decision are set out in Sam Komadina t/as We Paint Pools v Kelleher [2018] NSWCATAP 3.

Whether an order for costs should be made

The power to order costs is governed by s 60 of the NCAT Act: 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.
Clause 38 of the Civil and Administrative Tribunal Rules 2014 (the Rules) modifies the application of s 60 in proceedings in the Consumer and Commercial Division, and relevantly provides in cl 38(2) that in proceedings where the amount claimed or in dispute is more than $30,000, the Tribunal may award costs in the absence of special circumstances. The homeowner's claim was for reimbursement of a total amount of $29,390.00, being the cost for another contractor to repair the pool and the ground around the pool, and the amount paid to Mr Komadina. Clause 38(2) of the Rules does not apply, and the applicable costs provision for the proceedings in the Consumer and Commercial Division is s 60 of the NCAT Act. The first instance costs provisions did not differ from those in s 60, and accordingly cl 38A of the Rules does not apply.
The issue is therefore whether we are satisfied that there are special circumstances warranting an award of costs. Otherwise, s 60(1) provides that each party is to pay its own costs. The term "special circumstances" is not defined in the Act. It has been interpreted to mean circumstances that are out of the ordinary but not necessarily extraordinary or exceptional. The discretion to award costs must be exercised judicially having regard to the underlying principle that parties to proceedings in the Tribunal are ordinarily to bear their own costs: Megerditchian v Kurmond Homes Pty Ltd [2014] NSWCATAP 120 at [11].
The parties complied with the procedural directions made at the appeal call over on 12 September 2017, and it cannot be said that the appellant contractor conducted the appeal proceedings in a way that unnecessarily disadvantaged the homeowner. The contractor was unsuccessful both on the procedural fairness contention identified in the Notice of Appeal and on the additional ground for which he was given leave to amend during the appeal hearing. However, it could not be said that the appeal had no tenable basis in fact or law, or that the appeal proceedings were frivolous or vexatious or otherwise misconceived or lacking in substance. The submissions of the homeowner rely to a significant extent on her grievance with the work undertaken by the contractor, which was the subject of the first instance proceedings and in respect of which she was awarded compensation. Her complaint that the contractor does not respond to contacts at the address formally listed as his registered business address was a central issue, determined in her favour, in the appeal. However, while she was successful in defending the appeal and the order made in her favour at first instance, that is not sufficient to constitute special circumstances.
We are not satisfied that even if we were to extend the time for the homeowner to make her application for costs of the appeal, that the factors on which she relies, separately or in combination, constitute special circumstances warranting an award of costs. It follows we are unable to exercise the power to award costs in the appeal.

At a glance

Court

Decision date

Source

Judgment (7 paragraphs)

Parties

Cases Cited (2)

Cited By (4)