Marino v Building Commission NSW, Department of Customer Service

Material before the Tribunal

1. Both parties made written submissions to the Tribunal on the issue of costs. The Commission was granted the opportunity to provide further written submissions in reply and did so on 2 August 2024.
2. Attached to his written submissions, Mr Marino also provided correspondence between the parties: a letter of offer dated 14 May 2024 from Mr Marino and two responses from the Commission, one in the form of an email dated 23 May 2024 and one in the form of a letter dated 5 June 2024.

Procedural matters

1. The parties were given the opportunity to make submissions as to whether the Tribunal should dispense with a hearing, and while the Commission objected to a decision being made on the papers, I am satisfied the matter can be adequately determined in the absence of the parties, particularly because the Commission was provided with an opportunity to provide submissions in reply and applying the guiding principle of s 36 of the CAT Act to "facilitate the just, quick and cheap resolution of the real issues in the proceedings". A hearing in these costs application proceedings is therefore dispensed with under s 50(2) of the CAT Act.
2. In their first written submissions on costs, the Commission indicated they intended to appeal the substantive decision in this matter and would be seeking a stay of the Tribunal's decision as to costs. In their submissions in reply on costs the Commission made no further reference to an appeal or an application for stay. I have not been provided with any orders from the Appeal Panel staying the costs application proceedings or been made aware of any such application having been made.
3. Applying the guiding principle of s 36 of the CAT Act again, it is appropriate to proceed with this decision as to costs and I would not grant a stay in these cost application proceedings including because it will provide an opportunity for a party to request the issue of costs to be considered as part of any appeal.

Applicant's case

1. Mr Marino submits he should be awarded costs for the proceedings on the basis that special circumstances apply because of the Commission's conduct in the proceedings, particularly in relation to the issue of fitness and proprietary. Mr Marino submits the relevant statutory criteria are met to justify the Tribunal finding special circumstances apply.

Respondent's case

1. The Commission submits special circumstances do not apply as its conduct during the proceedings was proper, there was evidence to be properly tested and there were issues of law determined by the Tribunal in the matter.

Law

1. Section 60 of the CAT Act relevantly provides: (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.
2. The onus to satisfy the Tribunal that there are special circumstances warranting an award of costs lies with Mr Marino: Styles v Wollondilly Shire Council [2017] NSWCATAP 108.
3. The special circumstances specified in s 60(2) of the CAT Act are circumstances that are out of the ordinary and do not have to be extraordinary or exceptional: see Youssef v NSW Legal Services Commissioner (Costs) [2020] NSWCATOD 115 (Youssef) at [108].
4. Merely because one or more s 60(3) criteria are satisfied does not necessarily mean special circumstances exist, given the observations of the Appeal Panel in The Owners - Strata Plan No 63731 v B & G Trading Pty Ltd (No 2) [2020] NSWCATAP 273 at [11]-[13] that: 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].
5. In Youssef the Appeal Panel stated (at[107]): The general rule that parties should bear their own costs is 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]. It is accepted that where a party is unsuccessful in the party's application before the Tribunal, this alone will not amount to special circumstances in favour of the successful party.

Consideration

1. In this matter, while Mr Marino was successful it does not immediately follow that he should be awarded costs: see Youssef.
2. It is necessary to consider the whole of the circumstances of the proceedings and any relevant s 60(3) criteria as they apply in this matter in determining whether special circumstances exist warranting an award of costs.
3. The Commission's written submissions filed on 23 May 2024 stated this was "a relatively simple matter" (at [3] of exhibit R3) and focussed solely on statutory construction as it applied to Mr Marino, making no reference to the issue of fitness and propriety.
4. The Commission's letter of 5 June 2024 was the first time the Commission raised potential issues of fitness and propriety. This occurred in the context of rejection of an offer as to costs and did not clearly outline the basis upon which such an issue arose.
5. The Commission's conduct of the proceedings in raising the issue of fitness and propriety, well after the Applicant's material including submissions was before the Tribunal, unnecessarily disadvantaged the Applicant and failed to comply with the duty imposed by s 36(3) of the CAT Act. As a result, the Tribunal made procedural rulings to ensure fairness in the proceedings which also, in part prolonged the proceedings due to need for further written submissions after the hearing had ended (see [16] and [25] of the Tribunal decision).
6. Further, the Commission was wholly unsuccessful on the issue of fitness and propriety as set out in the Tribunal decision (at [43]-[48]): I am not satisfied there are any grounds to justify a finding, as the Commission seeks, that Mr Marino is not a fit and proper person to hold a licence under the HB Act. On the material before the Tribunal, I am not satisfied anything untoward occurred between late March 2023 when Mr Marino's father died and August 2023 when his plumbing business engaged a relevant supervisor. Mr Marino's evidence, which I accept, is that he relied on friends and fellow contractors to supervise work where appropriate in order to meet the immediate needs of clients during a tumultuous time of grief for his family. I note a qualified supervisor joined the business in August 2023, which was some time before the Commission responded in October 2023 to Mr Marino's early June 2023 application. I find Mr Marino to be a witness of credit. He answered questions openly and candidly. He emphasised his skills were in plumbing, not paperwork and that he trusted those with expertise, such as his accountant in relation to business structures. He understood the need for work to occur under appropriate supervision at all times and maintained that always occurred in his family business. Further, consistent with all the witnesses and referee's evidence, I am satisfied Mr Marino performed plumbing and other relevant work under the supervision of his father for over two decades until his father's untimely death in March 2023. On the material before the Tribunal, I am also not satisfied Mr Marino performed any unlicenced or unsupervised work at any time. Therefore, in all the circumstances, I find Mr Marino to be a fit and proper person for the purposes of the HB Act. The Commission asked the Tribunal to consider making serious character findings against Mr Marino, on the basis of his own documents, with no supporting evidence or investigation and at short notice to Mr Marino. Moreover the written submissions of the Commission filed prior to the hearing only addressed statutory interpretation issues, not the issue of fit and proper. In my view, those are not the actions of a model litigant under Premier's Memorandum M2016-03, Model Litigant Policy for Civil Litigation and Guiding Principles for Civil Claims for Child Abuse in the context of Tribunal proceedings.
7. Given those circumstances I am satisfied the Commission's claims as to fitness and propriety were weak.
8. Taking into account the whole of the circumstances as discussed in these reasons and on the material before the Tribunal, I am satisfied special circumstances arise in the proceedings that warrant a departure from the usual order that each party bear their own costs.
9. I note the majority of both the hearing, up to as much as one and a half days, and the remainder of the proceedings following the hearing focussed on the issue of fitness and propriety.
10. I agree with the Commission's submission that there were issues of law to be determined, as evidenced by the Tribunal decision at [49]-[56], therefore Mr Marino should not be awarded costs for the whole of the proceedings. Instead, Mr Marino should be awarded costs in respect of the issue of costs as well as the issue of fitness and propriety.
11. It follows that Mr Marino's application for costs should be granted in respect of the issue of fitness and propriety, and the issue of costs.

Orders 1. An oral hearing on the issue of costs is dispensed with under s 50(2) of the Civil and Administrative Tribunal Act 2013. 2. The respondent is to pay the applicant's costs, in relation to both the issue of fitness and propriety in the proceedings and the costs application, 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. 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: 14 August 2024