Lombardo v Hall

1. The applicants submit that Rule 38 of the Civil and Administrative Tribunal Rules 2014 applies to this costs application. The respondent makes a similar submission. I accept the parties' submissions. I find that when exercising my discretion to make a costs order under Rule 38, I must act in a judicial manner and in accordance with established authority.

1. The Applicants state that they were for these successful parties in the proceedings and that in accordance with orthodox principles they are entitled to their costs of the renewal proceedings on the ordinary basis. In making this submission that applicants concede that they did not succeed in obtaining damages for a repudiation that they alleged. The matters that the applicants rely on to support the submission that they were the successful party were:

(1) the fact that they obtained a monetary judgement in their favour and work orders including in relation to an additional major defect beyond the original work referred to in the Heads of Agreement;

(2) the fact that the respondent opposed the entirety of the relief that they sought;

(3) that the respondent contended that the application should be dismissed for want of jurisdiction;

(4) that a significant portion of the submissions were concerned with jurisdictional arguments raised by the respondent;

(5) that at 18 March 2024, the respondent had not accepted the scope of work that had been prepared by the applicants' expert for inclusion in the deed; and

(6) that the applicants were successful on the additional major defect referred to above.

1. The applicants also submit that they had mixed success and that there should be an apportionment of costs.

1. The respondent's submissions point out that the applicants' claims failed in a number of ways. It is submitted that apart from minor work associated with a mastic sealant, the applicants had no better success than if they had signed a deed in the form of the Heads of Agreement they entered into on 7 December 2023. It is submitted that the applicants' success on the defective sealant should not disentitle the respondent from his costs of successfully defending the claims. It is further submitted that this defective item of work did not occupy much time at the final hearing and was a discrete issue in the expert evidence. It was also pointed out that the applicants denied the respondent the opportunity to inspect the new defects, which included the defective sealant.
2. In connection with the question of which party was the successful party, and the order that was made for the respondent to carry out work referred to in the Heads of Agreement, the respondent submits that the respondent was always willing and able to perform his obligations under the Heads of Agreement and that outcome was available to the applicants without recourse to litigation.
3. In Reply the respondent contests the applicants' assertion that they were largely successful and that excessive time and effort was taken up with jurisdictional submissions.

1. The applicants refer to the fact that the respondent sought to avoid any liability and have the proceedings dismissed with costs. They say that in that context they were successful because they succeeded in obtaining the entirety of the relief they obtained.
2. I have had regard to the parties' costs submissions. I find that there is little utility in setting out every matter raised in detail.

1. I accept the respondent's citation of DSHE Holdings Ltd (Receivers and Managers) (in liq) v Potts (No 2) [2022] NSWCA 258 where at [9] the Court stated, albeit in the context of whether or not a particular issue or group of issues were dominant or separable:

'Put simply, in this case the Court should seek to make an order that is fair in all the circumstances, taking account of the extent to which issues are separable, and without aspiring to the false hope of mathematical precision.'

1. I find that there were numerous issues to be resolved in this renewal. In my view the dominant issue was the applicants' claim that the respondent had repudiated the Heads of Agreement entitling them to $297,307.93. I find that faced with such a claim and potential liability it was open to the respondent to assert whatever defence, including questions of the Tribunal's jurisdiction, that was appropriate in order to escape such a liability. So far as the Tribunal's jurisdiction to make orders resembling specific performance was concerned, I find that the respondent should not be criticized for raising such an issue. After all, as I stated at [32] of the decision a Senior Member of the Tribunal made the following comment at a directions hearing:

'The Tribunal does not have jurisdiction in respect of equitable causes of action (Steak Plains Olive Farm Pty Ltd v Australian Executor Trustees Ltd [2015] NSWSC 289 and authorities that refer to that decision)'

1. The detailed reasons for decision found that that the applicants had failed to persuade me that the respondent had repudiated the Heads of Agreement. This finding meant that the applicants failed in their claim for damages of $297,307.93.
2. It is true that the respondent raised technical legal issues of the 'Prevention Principle', 'Within a reasonable time' and 'Ready willing and able' in answer to the applicants' claim and that those arguments were for the most part unsuccessful. I find that the respondent's case on those issues did not take up periods of time at the hearing that could confidently be attributed to them. It was my impression that these issues were dealt with in counsel's written submissions, rather than in cross examination.
3. The applicants have also referred to their success on an additional defect item, which the respondent has described as the defective sealant issue. By far the most time that was spent at the hearing on additional defects was spent on a defect on which the applicants failed, namely the non-compliant flashing refer [178] - [200] of the decision. The defect that the applicants were successful on was item 5, on which the experts agreed, but which the respondent contended had been released by the Heads of Agreement and in any event was not a major defect. The respondent was not successful on either objection to the defect.
4. I find that the applicants were successful in obtaining orders which gave effect to the Heads of agreement plus the mastic control join defect. But that was not in my view the primary purpose for their renewal application. The first order they sought was:

'An order pursuant to section 59 of the Civil and Administrative Tribunal Act 2013 (NSW) (CAT Act) that the respondent is to pay the applicant damages to the assessed.'

1. In Points of Claim the applicants repeated that order, and also sought an order:

'pursuant to section 48O(1)(a) of the Home Building Act 1989 (NSW) (HBA) that the respondent pay money to the first applicant and the second applicant (collectively the Applicants) by way of damages to be assessed'

1. I find that the respondent was successful in resisting those orders and was thereby the successful party in the proceedings.
2. To the extent that the applicants were successful in obtaining orders equivalent to the benefits available to the applicants under the Heads of Agreement, I find that the respondent was at all times agreeable to performing the Heads of Agreement. Refer to [144] of the decision and [4] of the respondent's counsel's submissions.
3. For the reasons provided I will make an order that the applicants must pay the respondent's costs of the proceedings, such costs if not agreed 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).

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.