1. On 18 June 2025, the Tribunal dismissed the proceeding on the basis that the applicants failed to prove their claim against the respondents on the balance of probabilities.
2. The Tribunal reserved the issue of costs and allowed the parties to apply within 42 days of the June 2025 order.
3. On 28 July 2025, the applicants lodged an application for costs. The applicants seek an amount of $50,303.61.
4. On 14 August 2025, the Tribunal made orders for the parties to file and serve written submissions and supporting documents in relation to the applicants' costs application.
5. On 19 September 2025, the applicants filed submissions. The respondents have filed details and evidence of their legal costs but no submissions.

1. Section 109(3) of the Victorian Administrative and Civil Tribunal Act 1998 (Vic) ('VCAT Act') provides:

(3) The Tribunal may make an order under subsection (2) only if satisfied that it is fair to do so, having regard to-

(a) whether a party has conducted the proceeding in a way that unnecessarily disadvantaged another party to the proceeding by conduct such as -

(i) failing to comply with an order or direction of the Tribunal without reasonable excuse;

(ii) failing to comply with this Act, the regulations, the rules or an enabling enactment;

(iii) asking for an adjournment as a result of (i) or (ii);

(iv) causing an adjournment;

(v) attempting to deceive another party or the Tribunal;

(vi) vexatiously conducting the proceeding;

(b) whether a party has been responsible for prolonging unreasonably the time taken to complete the proceeding;

(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 proceeding;

(e) any other matter the Tribunal considers relevant.

7 The approach of the Tribunal to the question of costs was summarised by Gillard J in the case of Vero Insurance Ltd v The Gombac Group Pty Ltd [2007] VSC 117 at [20]:

(i) The prima facie rule is that each party should bear their own costs of the proceeding.

(ii) The Tribunal may make an order awarding costs, being all or a specified part of costs, only if it is satisfied that it is fair to do so. That is a finding essential to making an order.

(iii) In determining whether it is fair to do so, that is, to award costs, the Tribunal must have regard to the matters stated in s. 109(3). The Tribunal must have regard to the specified matters in determining the question, and by reason of paragraph (e) the Tribunal may also take into account any other matter that it considers relevant to the question of costs.

8 The prime requirement is that the costs order be fair, which has been said to require that the order be 'just and appropriate in the circumstances'.[1]

1. In June 2020, the respondents commenced a proceeding in the Magistrates' Court of Victoria for orders that a boundary fence be completed in accordance with an agreement between the parties. In June 2021, the Court ordered the fence be completed in accordance with the agreement.
2. In July 2021, the applicants commenced a proceeding in the Tribunal against the respondents alleging, since January 2018, there have been unreasonable flows of water from the respondents' land onto the applicants' land which has caused damage to the applicants' land, including the fence dividing the properties. The legal basis for the action was breach of section 16 of the VCAT Act and the applicants sought unspecified damages.
3. In July 2022 and through their lawyers, the parties signed a deed of settlement ('Deed'), which resolved the dispute over the boundary fence and alleged flows of water onto the applicants' land. Among other things, the Deed provided the applicants would pay $2,100 for their one-half contribution to complete the boundary fence and the respondents would carry out an agreed scope of work to address the alleged flows of water from their land onto the applicants' land.
4. In January 2023, the applicants requested the proceeding be re-instated on the ground the respondents had failed to comply with the Deed.
5. By Points of Claim filed in November 2023, the applicants sought an order that the respondents complete the work and/or pay damages of approximately $49,000 for the cost of rectification work to stop flows of water onto their land, and refund amounts paid for the boundary fence, legal costs and interest.
6. By Points of Defence filed in January 2024, the respondents denied liability for the applicants' claim and say they have complied with their obligations under the Deed.
7. In June 2025 and after hearing the parties' evidence and considering their submissions, I found the applicants failed to prove on the balance of probabilities the respondents beached their obligations under the Deed, save for the delay in completing the concrete upstand work in Clause 10(a) of the Deed. However, I found the breach of the Deed did not cause the applicants to suffer any loss or damage.

1. In a letter to the Tribunal, which accompanied their submissions dated 19 September 2025, the applicants state:

We are addressing the whole scenario again because of the confusion at the last hearing due to two other parties' documents unrelated to us was mixed in with our file. At the last hearing the whole situation was totally confused as we supplied costing as we were directed to do from a previous hearing 28 March 2024 (order attached Item 3). This hearing was later rescheduled to 11 December 2024. We have also obtained the transcript of the hearing from 3 May 2024 which shows we have complied with all directions given by VCAT.

1. The applicants contend there were errors in the Tribunal's 'computers' and the respondents have not been truthful. Because of this, the applicants submit they have had to obtain the recording of various hearings to show that the respondents did not comply with the Deed and that the Tribunal should not have relied on the respondents' oral evidence at the hearing. This has caused the applicants to incur further costs and inconvenience.
2. The applicants allege they were told costs would be awarded in their favour unless the respondents could prove that they have complied with the Deed, but evidence has proven that the respondents did not comply and were untruthful.
3. The applicants maintain that the respondents failed to show that they had a right to install the fence as they did not have a council permit to do so. The respondents' permit was to install the boundary fence on their property. However, the boundary fence crossed onto the applicants' property. The applicants submit there has been no work to rectify this issue.
4. The applicants seek the costs associated with the installation of the boundary fence, legal costs, consultants' fees, re-instalment of the fence in its correct position as per the permit, VCAT fees, and the cost of obtaining the recording of the hearings. The costs, including legal costs, amount to $50,303.61.
5. The applicants further contend the respondents are responsible for dragging this matter out by not being truthful and this is another ground on which they should be entitled to costs.
6. The applicants submit they have attempted to reduce costs by not engaging lawyers but, due to the respondents' unreasonableness, they have had no choice but to appoint lawyers, therefore incurring further costs.
7. The applicants submit that an award of anything short of the full amount claimed would be a denial of natural justice. Further, the respondents have bullied them and this is why a restraining order has been made against the respondents.
8. The applicants further note that none of the work has been rectified and do not have the Council's approval to be there. There is also a metre of soil that has caused damage to the applicants' property but the cost of rectification is not included in the claim.
9. In support of their application, the applicants have provided receipts for various costs related to the proceedings and work.

1. On 30 September 2025, the respondents sent an email to the Tribunal which purported to attach the respondents' submissions in relation to costs. However, no submissions accompanied the email and it is unclear if the respondents are seeking their costs of defending the proceeding.
2. The respondents attached to their email details and evidence of the legal and other costs and expenses they have incurred since September 2020, in dealing with the boundary fencing work, Magistrates' Court proceeding, and the Tribunal proceeding, including preparation and signing of the settlement deed.

1. I do not accept the applicants' claim for costs for the following reasons:

(i) The applicants are seeking to re-open and litigate the matters which were the subject of their unsuccessful claims against the respondents and the determination by the Tribunal per orders dated 18 June 2025. Such an application is misconceived.

(ii) The applicants substantially failed in their application for damages and relief against the respondents.

(iii) The applicants have not specifically referred to or addressed any of the factors in s 109(3) of the VCAT Act in support of their costs claim.

(iv) Apart from the legal costs incurred before the Deed was signed and expert witness fees, the applicants are seeking damages and the cost of rectification of the work. These costs and expenses fall outside the meaning of costs under s 109 of the VCAT Act.

(v) The legal costs incurred by the applicants and respondents in obtaining or responding to intervention orders are not part of the costs of the Tribunal proceeding.

1. Further, I find the Deed provides the parties are to bear their own costs of the proceedings, up to the time of settlement of the proceeding in June 2022.[2]
2. The applicants claim they were told costs would be awarded in their favour. However, I stated in my reasons that the Tribunal's preliminary view was that the parties should bear their own costs under s 109(1) of the VCAT Act.[3]
3. Insofar as the respondents seek their costs of the proceedings, in the absence of written submissions in support of such an application and for the reasons in paragraphs 28(iii) and (v) and 29 above, I find the respondents are also not entitled to their costs of the proceeding.

1. Under s 109 of the VCAT Act, the general rule is that each party is to bear their own costs in the proceeding, unless the Tribunal is satisfied that it is fair to order otherwise.
2. In the circumstances, I am not satisfied that it is fair to depart from the position that each party bears their own costs under s 109(1) of the Act.
3. For the reasons set out above, the applicants' application for costs is dismissed.
4. I will make orders accordingly.

[1] Filippou Management Pty Ltd v MREEF Project Company No 11 Pty Ltd [2010] VCAT 1261 at [20].

[3] Reasons dated 18 June 2025, 12 [99].