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[2014] WASAT 160
General information, not legal advice.
State Administrative Tribunal (WA)
2015-06-03
Original judgment source is linked above.
CITATION : McLERIE and KOLESZKO [2014] WASAT 160
Building Services (Complaint Resolution and Administration) Act 2011 (WA) - Standing to make complaint - Whether building service carried out by approved owner-builder - Whether home building work carried out under contract or arrangement for gain or reward - Whether contract or arrangement entered into by agent on behalf of respondent - What remedies available - Whether complaint made out of time
Building Act 2011 (WA), s 3
Building Services (Complaint Resolution and Administration) Regulations, reg 5, reg 5A, reg 5(5), reg 7
The applicants and the respondent are neighbours. The applicants claimed that they were entitled to an order for the demolition and reconstruction of a limestone wall on the boundary of the properties. The respondent's property is Lot 1 on a strata plan and is known as 14 Beach Street, Bicton. Lot 2 on the strata plan is situated at the rear of Lot 1 and is known as 14A Beach Street, Bicton. At the time of the original construction of the limestone wall, the strata plan had not been registered and the land was held under a single freehold title. The owners of Lot 2 had already demolished the section of wall bordering Lot 2 and the applicants' property. The applicants claimed to be entitled to an order for the amount which they had agreed to pay to the owners of Lot 2 for the reconstruction of the boundary wall between Lot 2 and the applicants' property.
It was not in issue that the original retaining wall had been constructed in a manner that was not proper and proficient, and was faulty or unsatisfactory by reason of the omission of reinforcing bars, the footings being inadequate and the wall not being constructed wholly within the boundary of the respondent's property (and the extension of it into what is now Lot 2) in accordance with the approved plans. The respondent had ultimately consented to the demolition of the wall following the issue of a building order by the City of Melville. The demolition had commenced at the time of the hearing but had not been completed.
After analysing the evidence, the Tribunal concluded that, on the facts, the limestone wall had been completed more than six years prior to the date on which the complaint was lodged with the Building Commission and therefore the proceedings fell to be dismissed as being out of time.
In case the dispute proceeded further, the Tribunal went on to make findings in relation to the remaining issues.
Contrary to the respondent's denial, the Tribunal concluded that the respondent had contracted with the applicants for the construction of the wall as shown on the building licence issued to her as an owner/builder. The contract had been entered into with Mr V Fazio acting as the agent for the respondent. However, in relation to the section of wall extending over what is now Lot 2, the Tribunal found that Mr Fazio had acted for an undisclosed principal, being the company which held the legal title to the land.
The Tribunal concluded that the applicants were entitled to make a building service complaint in relation to the construction of the wall because they were persons whose interests are being, and had been, adversely affected by the carrying out of a regulated building service. The Tribunal found that the construction of the wall constituted the provision of a regulated building service on two bases. Firstly, the Tribunal found that the wall had been constructed by Mr Fazio as an agent for the respondent under the building licence issued to her as an owner/builder. The Tribunal concluded that, as such, she constituted a repealed Act builder and the construction of the wall constituted a regulated building service under the Building Services (Complaint Resolution and Administration) Act 2011 (WA). Secondly, the Tribunal concluded that the construction of the wall constituted home building work within the definition of the phrase under s 3 of the Home Building Contracts Act 1991 (WA) if read with the definition therein of 'associated work' in relation to which an arrangement had been entered into for gain or reward, which therefore constituted a regulated building service. Consequently, it was held that the applicants had standing to advance their claim in relation to the dividing wall to the extent that it bordered the property of the respondent.
The Tribunal concluded that the applicants did not have standing to bring a claim against the respondent in respect to the extension of the wall running on the border of what is now known as Lot 2.
Consideration was then given to the controversy between the parties as to what would constitute an appropriate remedy but for the Tribunal's finding that the proceedings should be dismissed as being out of time. The Tribunal concluded that it would have been appropriate to issue an order for the demolition of the wall, notwithstanding the existence of an order from the Tribunal issued in mediation of a dispute between the City of Melville and the respondent, because the enforcement of that order lay in the hands of the City of Melville. Further, given that the applicants had made a not insignificant contribution towards the cost of the original wall, there was no reason why they should not be entitled to the building service being completely remedied so as to achieve compliance with the original building licence and the agreed form of the building wall.
Fazio v Fazio [2010] WASC 263
The Owners of 38- 40 Onslow Road, Shenton Park & Anor and C&I Constructions Pty Ltd [2014]WASAT123
The Owners of Strata Plan 41133 and Lendlease Project Management Construction (Australia) Pty Ltd [2014] WASAT 6
1 The applicants, Mr Mark McLerie and Ms Margo Zimmer and the respondent, Mrs Sarina Koleszko (formerly known as Miss Sarina Fazio), are neighbours, residing respectively at 12 and 14 Beach Street, Bicton in the State of Western Australia. They are in dispute as to whether the applicants are entitled to orders requiring the respondent to demolish and reconstruct a limestone wall dividing the properties and to recover the costs which they are obliged to contribute towards the cost of reconstructing a part of the same wall which now divides the applicants' property and a property created by subdivision, now known as 14A Beach Street.
3 For the reasons which follow, we conclude that the wall was completed more than six years prior to lodgement of the complaint with the Building Commissioner and that, therefore, the proceedings should be dismissed as being out of time. Having reached that conclusion, it is not strictly necessary to determine the remaining issues, but in case the dispute goes further, we shall set out our findings on those issues also, but we shall do so as concisely as possible.
4 We shall address all issues after setting out the background to the dispute. The background reflects the Tribunal's findings of fact based on the material before the Tribunal which is uncontested, unless the context indicates otherwise in which event our reasons reflect the basis upon which any disputed facts have been determined. We have made additional findings of fact to the extent necessary, and on the same basis, in the consideration of each issue.
5 It is not in issue that the applicants were at all relevant times and remain the registered owners of the land situated at 12 Beach Street. The house which was originally on the property has been demolished and the applicants are in the process of completing a new dwelling. During most of the relevant time, the applicants lived overseas and let out the old house.
6 The state of the title in relation to the property known as 14 Beach Street will be discussed further below in considering issue 2. It suffices at present to note that, as shown later below, the whole of the property known as 14 Beach Street was subdivided and a survey strata plan was registered during 2007. The rear of the property became known as 14A Beach Street, and is set out in what is usually described as a battleaxe block at the rear of 14 Beach Street. The common boundary between 12 Beach Street and 14 and 14A Beach Street is some 52 metres in length and it is the wall constructed along this boundary but encroaching partly into 12 Beach Street which is the subject of the dispute.
7 In December 2002, Mr McLerie met Mr Vincent Fazio. Mr Fazio informed Mr McLerie that he was building a house for his daughter at 14 Beach Street. The respondent is the daughter of Mr Fazio. Construction of the dwelling started in late 2002 or early 2003. There is no suggestion that there was any construction taking place on 14A Beach Street. All of this is evident from the exchange of emails numbered 35 to 38 in Exhibit 3. These emails also reflect that somebody had entered the applicants' property on 12 April 2003 and had removed the dividing fence between 12 Beach Street and 14 Beach Street and had cut down trees on the fence-line.
8 This led to Mr McLerie meeting with Mr Fazio 'on site' on 22 March 2004 and to a series of email communications (all from Mr McLerie) putting forward a basis upon which the applicants would contribute $5,148 to the cost of a dividing wall. The various communications which thereafter ensued will also be canvassed more fully when considering issue 2.
9 On 27 June 2005, Roadstone Quarries Pty Ltd (Roadstone) issued an invoice to the applicants for an amount of $5,148 for the construction of the limestone wall. The invoice reflected that the amount charged was the price for the construction of the wall 'as per your email instructions to Vince Fazio'. Mr McLerie had directed all of his email communications to an email address 'info@roadstone.com.au' but marked 'private for Vince Fazio'. The applicants responded to the invoice from Roadstone by email dated 18 September 2005 to Vince Fazio, but clearly directed to Roadstone, claiming there was no contractual relationship with the company, and suggesting that Roadstone contact the owners of 14 Beach Street. The applicants also emailed Mr Fazio on 30 November 2005 at the 'info@roadstone' email address, this time specifically requesting the email be passed on to Mr Vince Fazio or to Miss Sarina Fazio. The applicants stated that they had received another invoice from Roadstone, which they would not pay as they had no relationship with Roadstone. They advised they would be in Perth after Christmas and would be happy to meet with Mr Fazio to inspect the fence and 'close out any remaining issues'. It is to be noted that Roadstone carried on a business previously carried out by a partnership known as Italia Limestone Company which was started by Mr V Fazio in partnership with a number of other Italian immigrants: see the extract from the decision of Martin CJ in Fazio v Fazio [2010] WASC 263 at page 22 of Exhibit 3.
10 The next email communications from the applicants occurred on 26 February 2006. In one email addressed to Mr Vince Fazio, Mr McLerie apologised for missing a site meeting arranged over the Christmas period; he stated he had inspected the 'fence' and that it was looking very good but was clearly not finished (which is understood to mean at that time during the Christmas period). A cheque was enclosed to cover 50% of the agreed contribution, being $2,574.00. A second email was addressed to Miss Sarina Fazio and to Mr Vince Fazio. The applicants stated that they understood from their agent that the dividing fence had essentially been completed. They continued that, as they had not had any correspondence from 'you' since the email of 17 January 2005 and previous correspondence regarding their agreement to construct the dividing fence, they would like to confirm that 'you' accept the conditions as outlined. They then set out the same conditions as expressed in previous correspondence.
11 On 27 April 2007, the applicants addressed a further email to Mr Vince Fazio on behalf of the 14 Beach Street Owners, Miss Sarina Fazio, using the same info@roadstone email address. In this letter, the applicants stated, relevantly, as follows:
Further to our letter of 26 February 2006 we are pleased to see the dividing fence is new [sic] completed/and looking good.
Per our arrangement I am pleased to enclose at [sic] cheque for an additional $2,000 leaving $574 remaining from our agreed cost of $5,148. I would appreciate a receipt from you, as Owners of 14 Beach Street.
I will forward the remaining amount of $574 once you confirm completion in accordance with the requirements of our arrangement, as we stated in our letter of 26 February 2006.
12 A receipt was subsequently provided from V and G Fazio for the payment of the $2,000, with the payment particulars being noted '14 Beach Street, Bicton, dividing fence'.
13 The applicants returned to live in Australia with effect from 17 January 2007 and took up residence in the original dwelling at 12 Beach Street on or about that date. At that stage, the dividing wall appeared physically complete although, as will appear from evidence referred to later, there was ongoing building work being carried out at 14 Beach Street. As Ms Koleszko explained in her evidence, the house had been constructed by her father as a gift to her, but the gift did not include outside works (apparently other than the walls) such as the swimming pool and decking.
14 The conditions which the applicants had attached to their contribution towards the cost of a dividing wall included, amongst others, that the wall was to be built on the surveyed boundary, for the full extent of the applicants' block of 52 metres, that the footings would be suitable for the 'fence' in relation to depth and would be steel reinforced. The wording of the conditions might have suggested that some encroachment onto the applicants' property might be permitted because the conditions stated that the footings were not to 'protrude onto our property any more than the "fence" (including the retaining wall sections)'. However, Mr McLerie testified that this was stated in the context of the parties having before them what he referred to as the 2002 plans for the 14 Beach Street development which clearly showed that the fence including piers would be wholly constructed within the 14 Beach Street property (see bundle of documents (BOD) vol 3 p 504). No contrary proposition is advanced.
15 Mr V Fazio passed away on 5 August 2007. He had never responded to any of the applicants' email communications accepting the conditions which the applicants imposed. Neither was any response received from any other person, including the respondent. The applicants were concerned about whether or not the wall had been constructed in accordance with the conditions they had attempted to impose. During 2013, Mr McLerie was provided with copies of documents relating to 14 Beach Street by the City of Melville (City) following a freedom of information application. Although these documents delete references to the identity of the addressees of various communications, they disclose, relevantly, that the City had obtained a professional opinion on the adequacy of the masonry wall as a result of concerns expressed by the 'adjoining property owner' which is obviously a reference to the applicants. The opinion obtained was that the wall was structurally inadequate due to inadequate compaction, incorrect sizing of the footings, and because the piers were inadequate to support the wall spans and wall height (BOD vol 2 p 228/229). The then owners of 14A Beach Street, a Mr and Mrs Quinn, caused the portion of the wall dividing their property and that of the applicants to be demolished prior to that property being transferred to a Mr and Mrs Murphy. During or about May 2013, and as confirmed in email communications between the applicants, Mr and Mrs Murphy, and Bellagio Homes Pty Ltd, a building company engaged by Mr and Mrs Murphy, the applicants agreed to contribute an amount of $3,500 to the cost of the reconstruction of the wall.
16 The respondent did not then agree to the demolition of the wall. This resulted in the City issuing a building order against her on 12 February 2013. The respondent sought a review of that order before the Tribunal but ultimately agreed to carry out remedial work to address the structural concerns raised.
17 The applicants were incensed that the City had only taken up the structural inadequacies of the wall because they had also established that the wall encroached into their property, contrary to the building licence and approved plans. The encroachment is established by a surveyor's report (BOD vol 2 p 337). The encroachment extended over the full length of the wall dividing 14 and 14A Beach Street with the applicants' property to an extent of 0.17 metres at the northern end of the boundary and 0.14 metres at the southern end of the boundary.
18 In June 2014, the City issued the respondent with a further building order requiring the wall to be demolished on the grounds of the encroachment. The respondent again applied to the Tribunal for a review of the decision but, following mediation at the Tribunal, agreed to demolish the wall. An order to that effect was issued on 23 September 2014 (BOD vol 4 p 678). It was a term of that order that only upon completion of the demolition will the building order be set aside. With that background, we turn to consider each of the issues requiring determination.
19 The complaint was lodged with the Building Commission on 4 February 2013.
20 Section 6 of the Building Services (Complaint Resolution and Administration) Act 2011 (WA) (BSCRA Act) provides that a building service complaint is made out of time if the complaint is made more than six years after the completion of the regulated building service to which the complaint relates. We find that the construction of the wall constituted a regulated building service for the reasons given below in discussing whether or not the applicants have standing to make the complaint.
21 All references hereafter to sections or parts of legislation are to the BSCRA Act unless expressly stated otherwise.
22 The scheme of the legislation requires the Building Commissioner to make a preliminary decision whether or not to accept the complaint. One of the grounds on which the Building Commission may refuse to accept a complaint is that the complaint is made out of time: s 7(3)(c). If the Building Commissioner accepts the complaint, he is required to cause an investigation of the complaint to be carried out by an authorised person. The authorised person must, in turn, prepare a report on the investigation for consideration by the Building Commissioner. The Building Commissioner must consider the report and thereafter take certain specified steps. However, the Building Commissioner is expressly required to dismiss the complaint if it is made out of time. This procedure is set out in s 9, s 10 and s 11.
23 In this case, the Building Commissioner accepted the complaint, but during the course of the investigation of it, received specific submissions from the parties in relation to whether the complaint was made out of time. The Building Commissioner did not decide to dismiss the matter and instead referred the matter to the Tribunal pursuant to s 11(1)(d). In these circumstances, the Tribunal has power to dismiss the matter under s 47 of the State Administrative Tribunal Act 2004 (WA) if the complaint is out of time: see The Owners of 38- 40 Onslow Road, Shenton Park & Anor and C&I Constructions Pty Ltd [2014]WASAT123 (C&I Constructions).
24 It is therefore necessary to determine whether the construction of the wall was completed prior to 7 February 2007 being the date six years prior to the date of lodgement of the complaint on 6 February 2013.
25 As we understand the applicants' contentions, there are two bases upon which it is submitted that the complaint was made within time.
26 The direction of cross-examination conducted by Mr McLerie suggested that he had intended also to contend that, as there was still other building work being carried out on site, after the respondent took occupation, well into 2008 and possibly later, that the regulated building service therefore had not been completed until the completion of all of that work. When that was challenged by the Tribunal, Mr McLerie did not attempt to support that line of questioning, and therefore the proposition it was obviously intended to support. As will be seen, the applicants were correct to abandon that approach.
27 The time limit of six years runs from the completion of the regulated building service to which the complaint relates. By s 6(2), the regulated building service is taken to be completed:
(a) if the criteria for determining the date of completion for that building service are prescribed - on the date determined in accordance with the criteria;
(b) if (a) does not apply, on the date on which the building service was last carried out.
28 There are criteria prescribed for determining the date of completion. Regulation 7 of the Building Services (Complaint Resolution and Administration) Regulations 2011 (WA) (Regulations) provides firstly for circumstances in which the building work or demolition work was carried out under a building permit or demolition permit. Building or demolition permits are issued under the Building Act 2011 (WA) which only came into force in part on 26 August 2011 and in part on 2 April 2012. Regulation 7 to that extent therefore does not apply. The regulation, however, proceeds also to prescribe that, in the case of a regulated building service that is not carried out under a building permit or demolition permit and is carried out under a home building work contract or other contract that provides for a date of completion and has been brought to practical completion, that the building service is completed on the date practical completion is achieved. There is no evidence of any home building work contract or other contract that provides for a date of practical completion applying to the carrying out of this building service. This aspect of the Regulations therefore also does not apply.
29 Accordingly, by reason of s 6(2)(b), it is the date on which the building service was last carried out which is the date from which time commences to run, and that is the building service to which the complaint relates. In the case of a contract providing for practical completion, it would not really matter that the particular item of work the subject of complaint was carried out sometime prior to practical completion because practical completion would be the deemed date on which the regulated building service is taken to have been completed. Until practical completion, the builder remains in possession of the building site and therefore would generally not be in breach until attempting to deliver to the owner the defective work, and that would occur when practical completion is claimed to have been achieved and possession offered to the owner. When there is no such contractual regime applying, it is necessary to determine the date on which the building service to which the complaint relates was completed. The building service to which this complaint relates is the construction of the dividing wall. Consequently, as the applicants effectively conceded, it is not relevant to have regard to when all of the work, which was the subject of the building licence, was completed.
30 It is also not necessary to become involved in consideration of whether the existence of a latent defect, such as the omission of reinforcing steel, prevents the regulated building service ever having been completed. It is unlikely that the legislation ever intended such a result because s 6 is intended to provide certain events which will trigger the running of time. The prescribed criteria removes the room for any argument about the effect of latent defects. The statutory enquiry is a simple one, and that is to determine the date on which the building service to which the complaint relates was last carried out.
31 Accordingly, the only submission advanced by the applicants which might be upheld is that which depends upon the date the actual work on the wall was last carried out. In this regard, there is the original regulated building service for the construction of the wall, and there is the subsequent carrying out of remedial repairs. It may be that repairs carried out under the maintenance provisions of a building contract or the provision of a regulated building service would be caught by the date of practical completion, where the contract has such a provision. But, in our view, it would be entirely artificial to suggest that remedial work, carried out potentially many years after the completion of building work in the ordinary sense of that term, could constitute the last date on which the regulated building service was carried out so as to enable a complaint not related to the remedial work to be advanced. The subsequent remedial work would, in itself, be the provision of a regulated building service and if not carried out in a proper and proficient manner or if faulty or unsatisfactory, could be the subject of complaint: see The Owners of Strata Plan 41133 and Lendlease Project Management Construction (Australia) Pty Ltd [2014] WASAT 6 at [21].
32 We turn, therefore, to consider the evidence as to the date of completion of the wall.
33 Both applicants gave evidence touching this issue. The second applicant, Ms Margo Zimmer, gave evidence in an entirely satisfactory manner. She was careful to be accurate in all that she said and readily volunteered when she was not certain of her answer. Mr McLerie was not as satisfactory a witness because he slipped into making general statements which were sometimes misleading. For instance, he gave evidence that, as a result of a complaint from their tenants that the dividing fence which then existed had been taken down and trees on the border had been cut, he had obtained the respondent's details from the City and communicated with her. That was potentially misleading. Central to the dispute between the parties is whether Mr Fazio acted on behalf of the respondent. For Mr McLerie to say that he communicated with the respondent gave the impression that he had direct communication with her at that time, and strengthened the contention that when he dealt with Mr Fazio, Mr Fazio was acting for the respondent. He was asked to produce the documents which established this and he then collated overnight and tendered the next morning Exhibit 4. The email communications within Exhibit 4 show only communications with Mr Fazio in the period in which contact was made after the removal of the dividing fence and in the discussion of the construction of a new dividing wall. Consequently, we have approached Mr McLerie's evidence with care and, where possible, have sought to reconcile it with contemporaneous records, or otherwise have sought corroboration with the evidence of other witnesses.
34 The respondent and her husband both gave evidence on this issue and they did so in an entirely acceptable manner.
35 There was some controversy as to whether the entire 52 metre length of wall had been completed by June 2005. At that time, the respondent applied for a further building licence in respect of a retaining wall and front wall on the northern side of 14 Beach Street, which links up with the north /south boundary where the wall in issue is located. The issue was whether a 7 metre section of the fence bordering 12 Beach Street had then been completed, because there is no suggestion that any other portion of the wall appeared incomplete. An annotation on the approved plan suggests that the dividing wall had been constructed up to that 7 metre point, but not beyond it. Little turns on this controversy.
36 The respondent testified that the dividing wall section had been completed by the end of 2005 and that the front wall was completed during 2006. She stated that she moved into her new home in about June or July 2006. She could not be sure of the month but it was during winter. A letter from Telstra dated 10 February 2014 provided to the Magistrates Court in relation to proceedings between the parties shows that telephone services were billed to the respondent at 14 Beach Street from 24 July 2006. We find that the respondent had taken occupation of the house at 14 Beach Street shortly prior to 24 July 2006. She stated that no work had been done on the dividing wall from when she moved in until she caused structural repairs to be carried out in 2013.
37 Ms Zimmer stated that when she and her husband moved into the property on 17 January 2007, the dividing wall appeared physically complete. However, she stated that from May through to November 2007, there was frequent work carried out on the dividing wall. The work was carried out in the evening, sometimes until late into the night. The work involved jack hammering. She stated that she had been involved in the renovation of a number of homes and that she knew what jack hammering sounded like and that she could tell from the sound and from the proximity of the noise that it was in relation to work carried out on the dividing wall. She could not actually see any of the work carried out because it was at night and it was on the other side of the solid wall. Mr McLerie corroborated this evidence.
38 The respondent said that there was jack hammering carried out at one stage because the concrete pool, as constructed, had not allowed for a skimmer box and the concrete was too thick. She and her husband had been involved in the completion of all outside work after they had moved into the house. Her father had gifted the house to her but had left the completion of the outside to her.
39 The respondent's husband testified that he was an employee in the Roadstone business where he ran the processing facility. He had nothing to do with the actual construction of the dwelling at 14 Beach Street. He said that they had moved into the new home in 2006. He was not sure of the time of year. He had helped with the construction of the front wall which he said was the last work undertaken before they moved in.
40 It is readily evident that the evidence of what the applicants heard at night can be reconciled with the evidence of the respondent and her husband, which we accept. It is difficult to understand what work could have been carried out on a dividing wall which appeared to be physically completed and that took from May through to November 2007 to complete. Ongoing work during this period is, on a balance of probability, more consistent with the explanation offered by the respondent and her husband.
41 By January 2007, the dividing wall appeared to have been physically completed. By the applicants' letter dated 27 April 2007, they made payment of the balance of the agreed contribution, withholding only $574 because they wanted written confirmation of compliance with the various conditions which they had imposed. By that letter, they also apologised for not getting back to Mr Fazio sooner, explaining that they had been extremely busy since relocating back from the United Kingdom. In a communication with the building service coordinator dated 5 October 2012 (BOD vol 1 p 117), the applicants stated:
We confirm that the dividing fence was constructed by the owners of 14 Beach Street between early 2005 and 2006 pursuant to their written agreement (agreement) entered into by the parties on or about May 2005 whilst we were living overseas.
42 These communications are consistent with the respondent's case. If the applicants were of the view that work had recommenced on the dividing wall through the period May to November 2007, it is strange that this was not taken up with the respondent, given that the applicants had paid virtually the full contribution by the end of April 2007.
43 We accept the evidence of the respondent and her husband that the last work done on the walls was the construction of the front section of wall prior to them taking occupation. We have already found that occupation was taken shortly prior to 24 July 2006. We consequently find that the dividing wall along its full 52 metre length had been completed shortly prior to 24 July 2006. The complaint to the Building Commission would need to have been lodged within six years of whatever was the actual date of completion in 2006. As it was only lodged on 4 February 2013, it is out of time.
44 For the reasons discussed in C&I Constructions, the intent of the legislation is that complaints should be dismissed if made out of time. The proceedings therefore fall to be dismissed on this basis.
45 As mentioned above, we shall nevertheless set out our reasons as concisely as possible in relation to the remaining issues.
Did the applicants contract with Mr V Fazio on behalf of the respondent for the construction of the dividing wall?
46 Mr McLerie's evidence was that, following advice from the tenants of 12 Beach Street that the then existing dividing wall had been taken down, he had obtained information from the City identifying the respondent, then known as Miss Sarina Fazio, as the owner of the next door property. This evidence is correct in substance but not as to timing. The email communications in Exhibit 3 at page 38 show that the applicants received an email from Ms Meredith Kenny of the City sometime prior to 28 August 2002 advising that the owner of 14 Beach Street, according to an application form for an ownerbuilder building licence lodged with the City, was Miss Sarina Fazio of 14 Beach Street. The email further advised that the City's property database listed the owner of 14 and 14A Beach Street as Anham Nominees Pty Ltd. It was not until April 2003 that the dividing fence was removed, as reflected in the communication from Kristy, who is understood to be the applicants' letting agent, dated 15 April 2003 (Exhibit 3, page 36).
47 The application referred to related to what Mr McLerie referred to as the 2002 plans for the development at 14 Beach Street. A copy of these plans was faxed to Mr McLerie by Ms Meredith Kenny on 5 November 2002 (Exhibit 3, pages 39 - 41). The plan, at page 41 of Exhibit 3, shows 14 Beach Street divided into two lots. The front lot, which is where the respondent currently resides, is described as Lot 1 and the rear lot as Lot 2. This suggests that 14 and 14A Beach Street were strata titled properties. However, an application to register a strata/survey-strata plan was only signed on behalf of Anham Nominees Pty Ltd on 5 December 2006 and must have been lodged sometime thereafter (Exhibit 1 vol 1, page 294). The application describes the land to be registered on the strata plan as being Lot 599 on plan 4549. A duplicate record of certificate of title issued on 30 July 2003 reflects that the registered proprietor of Lot 599 on plan 4549 is Anham Nominees Pty Ltd.
48 The applicants provided an email communication dated 25 March 2013 from Mr John Quinn who was then the owner of 14A Beach Street, who stated that he had bought the property on or about 10 September 2011 from Anham Nominees Pty Ltd.
49 Although a transfer of land form for the transfer of Lot 1 on survey-strata plan 37082 was signed on 27 June 2002 in respect of a transfer of Anham Nominees Pty Ltd's interests notified on survey-strata plan 37082 to Miss Sarina Fazio, Exhibit 7 demonstrates that transfer was only effected during 2007. This is consistent with an application for registration of the strata plan being lodged sometime after the application for registration which was signed on 5 December 2006.
50 As related above, Mr McLerie first met Mr V Fazio in December 2002 when Mr Fazio advised that he was building a home for his daughter (Exhibit 3 page 35). At that time, an application was before the City for the issue of an ownerbuilder's licence to Miss Sarina Fazio. That licence was issued on 25 January 2003 (BOD vol 3 p 500 - 504). The building licence was for the construction of a two storey front grouped dwelling at the address described as 'strata 599/1 plan 37082, 14 Beach Street, Bicton WA 6157'.
51 The applicants relied strongly on Mr Fazio's advice that he was building for his daughter, and the advice they had received from the City together with copies of the plans for 14 Beach Street, to the effect that the owner of 14 Beach Street, according to the application form, was Miss Sarina Fazio (although the City's property database listed the owner of 14 and 14A Beach Street as Anham Nominees Pty Ltd). It is not apparent why the City described the property in a manner as if the strata plan had already been registered, as it is clear from the records referred to above that the plan could not have been registered prior to 5 December 2006. In the email communications which ensued and to which we have already referred, the applicants dealt with Mr V Fazio without any initial intimation that they regarded him as acting on behalf of the owner of 14 Beach Street. This was made clear for the first time only in an email dated 17 September 2005 and a subsequent email on 30 November 2005, both addressed to Mr Fazio (BOD vol 1 p 37). Nevertheless, we accept and find that Mr McLerie believed throughout this period that Mr V Fazio was acting on behalf of his daughter, because he understood that it was the respondent who was responsible for the building works which included the boundary walls shown on the plan. Mr Fazio had advised the applicants that he was building for his daughter and the building licence had been issued in her name. By the respondent applying in her own name for an ownerbuilder's licence and then standing by and allowing her father, Mr V Fazio, to make all the arrangements with subcontractors and effectively construct the dwelling at 14 Beach Street on her behalf, she held him out as being entitled to contract on her behalf.
52 Although there was no response clearly accepting the conditions which the applicants were imposing to their contribution towards costs, we find a contract was concluded by conduct.
53 After receipt of the applicants' email setting out those conditions, a quotation was received from Fazio Homes providing costs for various options, depending on the length of wall to be constructed, including one option requiring a contribution of $5,148 for the construction of a 52 metre wall along the entire boundary with the applicants' property (BOD vol 1 p 31).
54 The applicants responded to that quotation by email dated 31 May 2004 to the info@roadstone address but marked 'Private: for Vince Fazio', advising that they were happy to pay the contribution of $5,148, subject to a number of conditions. The conditions included the height of the fence, the finish to be provided, that the wall would be built for the full extent of the boundary with their property (52 metres), and that the footings would be suitable in terms of depth, would be steel reinforced and would not protrude onto their property. The applicants did not accept the Fazio Homes quotation. They made an offer to contribute towards the cost to Mr Fazio who, they understood, and who, for the reasons which follow, we find was acting as an agent for the respondent.
55 The connection between Mr V Fazio and Fazio Homes was never explained.
56 As stated, there was never any response to the applicants' emails above.
57 The applicants responded, by way of an email letter dated 26 February 2006 (BOD vol 2 p 258), to a request for their consent to the construction of what they described as a front 'fence' (wall) and retaining wall at 14 Beach Street (which we understand was required because the structures encroached into the front setback). The applicants recorded that they understood from their agent that the dividing wall had essentially been completed. The applicants again sought acceptance of the conditions which they wished to apply to their contribution towards the cost of the dividing wall.
58 The correspondence reflects that a meeting was arranged between the applicants and Mr V Fazio over the Christmas period in 2005 but that the applicants were unable to attend as a close relative was admitted to hospital. In a letter dated 26 February 2006 (BOD vol 2 p 257), the applicants recorded that the dividing wall had been inspected and was looking very good, but clearly was yet to be finished. It is not clear as to what extent the dividing wall remained to be finished, although, as outlined above, it is possible that a 7 metre section of the dividing wall at the northern end required completion (being part of the wall the subject of a request for the applicants' consent referred to above in the email communication of 26 February 2006). In any event, the applicants paid 50% of the agreed contribution by way of a cheque enclosed in that letter.
59 On or about 27 June 2005, an invoice was received from Roadstone for the construction of the dividing wall 'as per your email instructions to Vince Fazio'. It was to this invoice that the applicants responded to Mr V Fazio, making it clear that their communications had been to him on behalf of the owners of 14 Beach Street and that they had no contractual relationship with Roadstone.
60 Having regard to the contact which Mr McLerie had with MrV Fazio, the advice that Mr Fazio was building for his daughter (the respondent), and that she had applied for and obtained the building licence, we find that Mr Fazio acted as her agent, at least insofar as the construction of the dividing wall bordering 14 Beach Street was concerned (Lot 1 on the strata plan). Although the respondent was not the legal owner of the land at that stage, it was obviously intended that the property would be transferred to her. The whole of 14 Beach Street, including the rear portion, was then owned by Anham Nominees Pty Ltd. Anham Nominees Pty Ltd is the trustee of the V Fazio Family Trust, the beneficiaries of which were the children of Mr Vince Fazio, their children and grandchildren, and Vince and Guiseppina (see Exhibit 3 at pages 22 - 24).
61 However, the respondent had nothing to do with the development of the rear of 14 Beach Street, which was subdivided to become Lot 2 on the strata plan and is known as 14A Beach Street. The building licence issued to the respondent related only to the front section of the property, being 14 Beach Street. Consequently, by Mr V Fazio arranging for Roadstone to invoice the applicants, and by his acceptance of the payments made by them, we conclude that a contractual relationship was established with the respondent, but only in relation to the front property known as 14 Beach Street (Lot 1 on the strata plan).
62 Mr Fazio did not disclose the identity of the principal contracting in respect of the length of the dividing wall beyond the boundary of what, for convenience, we shall refer to as 'Lot 1'. In respect of that further section of dividing wall, Mr Fazio was, in our view, acting as agent for an undisclosed principal, namely, Anham Nominees Pty Ltd.
63 As the matter does not involve the enforcement of contractual rights, it is not necessary to go further than our finding that a contractual relationship is established with the respondent. The consequences of this finding will fall for further consideration when examining the remaining issues.
Do the applicants have standing to advance the claim against the respondent?
64 Section 5 enables a person to make a complaint to the Building Commission about a regulated building service not being carried out in a proper and proficient manner, or being faulty or unsatisfactory. By s 5(5), regulations may prescribe who may make a complaint. Regulation 5 prescribes that such a complaint may be made by a person whose interests are being, or have been, adversely affected by the carrying out of the regulated building service.
65 The applicants were directly affected by the construction of the dividing wall in a manner which was not structurally sound and which encroached without their consent onto their property. They are therefore persons whose interests were adversely affected.
66 The question then remains whether they are advancing a claim which is in respect of a regulated building service.
67 A regulated building service is defined so as to include a building service carried out by a registered building service provider or an approved ownerbuilder; or home building work that is carried out by a person for another person under a home building work contract, or other contract or arrangement for gain or reward; or any other service or work prescribed.
68 Regulation 5A prescribes for the purposes of the definition of 'regulated building service' the construction, alteration or demolition of a building by a repealed Act builder at the time the work was carried out. A repealed Act builder is defined to mean, relevantly, a person who has constructed a dwelling under a building licence issued in accordance with s 4A(i)(c) of the Builders Registration Act 1939 (WA). The respondent was issued her ownerbuilder licence under this regime. Further, the definition of 'building' includes any incidental structure, fence, freestanding wall and retaining wall: s 3 read with s 3 of the Building Act 2011 (WA).
69 On our above findings, the respondent's dwelling at 14 Beach Street was constructed by her father, Mr V Fazio, but as an agent on her behalf. Her evidence reflects that she had very little involvement in the actual building. But she obtained the building licence and was aware that her father was carrying out the construction. He therefore acted on her behalf. It is likely that the costs were paid for out of the V Fazio Family Trust given that the trustee, Anham Nominees Pty Ltd transferred the property to the respondent, presumably as payments made on behalf of the respondent who was a beneficiary as one of the children of Mr V Fazio. The construction of the dwelling, in our view, including the construction of the boundary wall, constituted a building service carried out by the respondent as a repealed Act builder (being an approved ownerbuilder under the Builders Registration Act 1939 (WA)).
70 In addition, the construction of the dividing wall constituted 'home building work' within the definition of that phrase contained in s 3 of the Home Building Contracts Act 1991 (WA), read with the definition therein also of 'associated work'. Although there might be some difficulty in severing the contract terms as they apply to each principal involved, there is no doubt that the contract, whether enforceable or not, constituted an arrangement entered into for gain or reward in the form of the contribution which the applicants agreed to pay.
71 On either of the above bases, we find that the applicants therefore had standing to bring the claim, at least insofar as it relates to the dividing wall bordering their property with that of the respondent.
72 The respondent did not, however, have anything to do with the building of the dividing wall bordering 14A Beach Street and the applicants' property. As far as that aspect of the work is concerned, Mr Fazio must be regarded as acting on behalf of Anham Nominees Pty Ltd, an undisclosed principal. Mr Fazio was authorised to represent the respondent insofar as the carrying out of building work on 14 Beach Street is concerned, but she had no building licence in respect of 14A Beach Street and no reason to authorise Mr Fazio to do any work on her behalf in respect of 14A Beach Street.
73 The applicants therefore have no standing to advance a claim against the respondent in respect of the section of wall bordering 14A and 12 Beach Street.
74 Obviously, on our above finding that the complaint was made out of time, the proceedings fall to be dismissed. However, our findings in relation to the remaining issues would come into operation if our conclusion that the proceedings were commenced out of time were found to be wrong. On that assumption, we consider what remedies would be appropriate.
75 The applicants contributed a total sum of $4,574 towards the cost of the construction of the 52 metre length dividing wall. The construction of the dividing wall constituted the provision of a regulated building service, not only for the benefit of the owners of 14 and 14A Beach Street, but also for the applicants.
76 The respondent contends that, even though the dividing wall was faulty or unsatisfactory, or not constructed in a proper and proficient manner, the applicants do not need any remedy because there exists already an order of the Tribunal requiring the 14 Beach Street portion of the dividing wall to be demolished. That is true, but enforcement of that order lies directly in the hands of another party, namely, the City. There is no reason, in our view, why the applicants should not enjoy the benefit of an order in their favour, which they may enforce, should that be necessary. In addition, having paid a not insignificant contribution towards the cost of the dividing wall, there is no reason why the applicants should not be entitled to the building service being completely remedied so as to achieve compliance with the original building licence and the agreed form of the dividing wall. Accordingly, but for our finding that the complaint was made out of time, we would have granted an order for the demolition and reconstruction of the dividing wall as described. We would not, however, have granted any relief in respect of the rear portion of the dividing wall forming the boundary with 14A Beach Street with which the respondent had no involvement.
77 For the above reasons, we shall cause an order to issue as follows:
I certify that this and the preceding [77] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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CITATION : McLERIE and KOLESZKO [2014] WASAT 160 (S)
MEMBER : MR C RAYMOND (SENIOR SESSIONAL MEMBER)
Building Services (Complaint Resolution and Administration) Act 2011 (WA) Successful respondent applying for costs Whether justice of the case supports an award of costs Effect of offer to settle
Legal Practitioners (State Administrative Tribunal) Determination 2012 (WA)
Limitation Act 2005 (WA), s 13
State Administrative Tribunal Rules 2004 (WA), r 40, r 41, r 42(2)
The respondent, as the successful party to the proceedings, made an application for costs in the total sum of $27,392.20. The applicants opposed the order for costs.
The Tribunal referred to the principles applicable to the order for costs in respect of proceedings brought under the Building Services (Complaint Resolution and Administration) Act 2011 (WA) as outlined in Hoskins and Daniel Vinci t/as D'Vinci Contracting [2011] WASAT 188 and in relation to an offer made in accordance with r 40 and r 41 of the State Administrative Tribunal Rules 2004 (WA) as discussed in Ampezzo Pty Ltd and Franken [2009] WASAT 109 (S).
The Tribunal found that the failure of the respondent to address the dispute in a responsible and neighbourly way, together with the fact that she had escaped legal liability due to a technicality, namely the claim having being made out of time, as well as the fact that the applicants had probably lost the right to enforce any contractual claim for the reconstruction of the works in question, militated strongly against any award of costs.
On the other hand, the Tribunal found that the applicants should have become aware of decisions of the Tribunal pointing to the likelihood that their claim was out of time and should certainly have focused on that issue when an offer of settlement was received some six weeks prior to the hearing. In all the circumstances, the Tribunal determined that the applicants should be ordered to pay a contribution to the respondent's costs based on the costs incurred from the date on which the offer of settlement was made.
Because the nature of the dispute did not warrant an award of costs at the maximum rates set out in the Legal Practitioners (State Administrative Tribunal) Determination 2012 (WA), the Tribunal fixed the rates at a level approximating 80% of the maximum under that Determination. An order was made that the applicants contribute an amount fixed in the sum of $10,500 towards the respondent's costs.
Ampezzo Pty Ltd and Franken [2009] WASAT 109 (S)
Hoskins and Daniel Vinci t/as D'Vinci Contracting [2011] WASAT 188
Marvelle Investments Pty Ltd and Argyle Holdings Pty Ltd [2010] WASAT 125 (S)
McLerie and Koleszko [2014] WASAT 160
Pearce & Anor and Germain [2007] WASAT 291 (S)
Teo and Gojko Maricic t/as G & Ms Maricic Building Co [2013] WASAT 166
The Owners of 3840 Onslow Road, Shenton Park & Anor and C&I Constructions Pty Ltd [2014] WASAT 123
The Owners of Strata Plan 41133 and Lendlease Project Management Construction (Australia) Pty Ltd [2014] WASAT 6
1 The applicants, Mr Mark McLerie and Ms Margo Zimmer and the respondent, Mrs Sarina Koleszko (formerly known as Ms Sarina Fezio), are neighbours, residing respectively at 12 and 14 Beach Street, Bicton in the State of Western Australia. The parties were in a dispute concerning whether the applicants were entitled to require the respondent to demolish and reconstruct a limestone wall dividing the properties and to recover the costs which the applicants were obliged to contribute towards the costs of reconstructing an extension of the same wall dividing the applicants' property and a property created by subdivision, known as 14A Beach Street, Bicton. The Tribunal dismissed the application as reported in McLerie and Koleszko [2014] WASAT 160 (the Principal proceedings or Principal decision). The respondent has applied for costs totalling $27,392.20 and both parties have filed written submissions.
2 The respondent asserts that in the general exercise of the Tribunal's discretion, costs should be awarded, alternatively, costs should be awarded by reason of the applicant's refusal of an offer to settle dated 26 September 2014 which was expressed in the standard 'Calderbank' offer form as having been made without prejudice save as to costs.
3 There are a range of factors that might contribute to the Tribunal making a costs order, including the following nonexhaustive list:
as discussed in Pearce & Anor and Germain [2007] WASAT 291 (S) at [22] [24]; Marvelle Investments Pty Ltd and Argyle Holdings Pty Ltd [2010] WASAT 125 (S) and Hoskins and Daniel Vinci t/as D'Vinci Contracting [2011] WASAT 188.
4 In the case of an offer of settlement, whether or not the offer complies with r 40 and r 41 of the State Administrative Tribunal Rules 2004 (WA) (SAT Rules) the Tribunal, in determining the costs that may be awarded, must take into account that a party did not accept an offer more favourable than the Tribunal's order. In deciding whether the rejection of an offer was unreasonable, regard should ordinarily be had to, at least the following:
as discussed in Ampezzo Pty Ltd and Franken [2009] WASAT 109 (S).
5 On any measure, the effort required to resolve the dispute between the parties has been disproportionate.
6 The applicants commenced proceedings in the Magistrates Court under the Dividing Fences Act 1961 (WA). Those proceedings were dismissed and resulted in a costs award in favour of the respondent in an amount of $11,246.30. The applicants unsuccessfully appealed that decision.
7 As a result of complaints made by the applicant, the City of Melville (City) issued a building order for the removal of the dividing wall based on the City having determined that the wall was structurally unsafe. The respondent applied for a review of that decision in Matter No CC 310 of 2013. The matter was settled in mediation on the basis that the respondent was to carry out structural repairs.
The applicants were incensed that the City [of Melville] had only taken up the structural inadequacies of the wall because they had also established that the wall encroached into their property, contrary to the building licence and approved plans[.]
Ultimately the City issued a further building order for the removal of the wall based on the encroachment. The respondent again applied to the Tribunal for a review of the decision. Ultimately, that matter was resolved in mediation as well, with the respondent consenting to an order for the demolition of the wall. That concession was reflected in mediation orders made by the Tribunal on 23 September 2014.
9 There are a number of factors which have contributed to the intractable dispute which still exists between the parties. The prime cause of the dispute, as is so often the case, is a complete breakdown in communication between the parties. The respondent has been less than forthcoming in her dealings with the applicants. Prior to the determination of the Tribunal in the Principal proceedings there may have appeared to be a number of technical arguments available to the respondent. But, morally, and if there had been any inclination on her part to be a good neighbour, she should have recognised that the wall constructed on her behalf, by her father, was defective and should have accepted a responsibility to rectify the situation by causing the wall to be reconstructed in accordance with the originally agreed terms. She has never done so and even now, as reflected in the settlement offered to which reference will be made later, she has done no more than to buckle under irresistible pressure to demolish the wall. She has given no indication of any willingness to reconstruct the wall in a proper manner. It is legitimate for the Tribunal to take this into account: see the discussion in GE Dal Pont, Law of Costs (2nd ed, 2009) at [8.51].
10 The applicants have contributed to the breakdown in communication by an over legalistic approach to all matters. Mr McLerie is a sophisticated person, clearly familiar with commercial contracts, as evident by his drafting of many documents that were before the Tribunal, and has endeavoured to ensure that dealings are recorded in writing and in some detail. On the other hand, the respondent presents as a far less sophisticated person. When challenged during the hearing about her failure to respond to Mr McLerie's many written communications, the respondent replied to the effect that Mr McLerie should simply have come to speak to her rather than to write in such a legal manner. We considered that to be a genuine and understandable response but it does not excuse, at least morally, her failure to rectify the situation by agreeing at an early stage to a demolition of the wall and its reinstatement in accordance with the terms originally agreed with her father, on her behalf. The respondent has escaped legal liability in these proceedings before the Tribunal on a technicality, namely, that the claim was made out of time.
11 The above weighs against an award of costs in favour of the respondent particularly as, contrary to the applicants' submissions we do not consider that the applicants established any point in the proceedings before the Tribunal which will be of assistance to them. The applicants submit that as a result of the Tribunal's findings that a contract was entered into between them and the respondent, represented by her father, that they will be able to enforce this contract and have thereby established a claim having a value, based on estimated replacement cost, of approximately $40,000 and an estimated claim for damages in excess of $40,000. This overlooks that a contractual claim for breach cannot be enforced by an action commenced if six years have elapsed since the cause of action accrued pursuant to s 13 of the Limitation Act 2005 (WA). It is therefore doubtful that the applicants have gained any benefit out of the Tribunal's determination in the Principal proceedings.
12 By pure chance therefore the respondent may well escape any legal liability to reconstruct the wall and any possible claim for damages. If a sensible attitude had been adopted by the respondent, this dispute could have been resolved as easily as the new owners of the lot at the rear of the respondent's lot were able to resolve the matter with the applicants, as referred to at [15] of the Principal decision. While these circumstances militate strongly against any award of costs in favour of the respondent, there are other factors which need to be considered.
13 Firstly, we consider that the applicants should have realised at some time prior to the hearing that they were unlikely to succeed on the grounds that the application was out of time. They were alerted to the issue because it had been raised in the proceedings when still before the Building Commissioner. Prior to the hearing there had been decisions of the Tribunal which cut across what appears to have been a significant basis for the applicants contending that the wall had never been completed because it had not been constructed in accordance with the agreed terms and that their claim was therefore not out of time: see The Owners of Strata Plan 41133 and Lendlease Project Management Construction (Australia) Pty Ltd [2014] WASAT 6; The Owners of 3840 Onslow Road, Shenton Park & Anor and C&I Constructions Pty Ltd [2014] WASAT 123 and Teo and Gojko Maricic t/as G & Ms Maricic Building Co [2013] WASAT 166. This argument was not pressed at the hearing although it has been revived at paragraph 11 of the applicants' opposing submissions. Otherwise, the applicants' argument concerning the date of completion had to rest on the evidence of the second applicant, Ms Zimmer, which fell far short of establishing their case. This evidence was examined in detail in the Principal decision.
14 Given the way in which Mr McLerie has conducted the litigation, we consider that it was well within his capability to have researched the above decisions and to have properly analysed them. The applicants should have been further focused on their proper consideration of this weakness in their case once they received the respondent's offer of settlement dated 26 September 2014. The offer, as already stated, is expressed in Calderbank form, but it also complies with r 40 and r 41 of the SAT Rules. It specifies that it is an offer made without prejudice and it provides for a period of consideration of the offer which complied with the minimum period specified of 14 days.
15 The offer was made approximately six weeks prior to the date on which the matter was set down for final hearing. The content of the offer was expressed as follows:
With respect to the issues relating to the Building Service Complaint comprising State Administrative Tribunal Action Number CC 489 of 2013, our client, Sarina Koleszko, herby offers to resolve all issues that you have raised in those proceedings on the basis that:
In making this order we make the following observations:
If you proceed to a trial of this matter (or proceed generally with it) and do not achieve an outcome before the Tribunal on terms any more favourable than those set out in this offer, we will rely upon the terms of this letter in order to seek a costs order against you for all costs that our client incurs in the proceedings.
The offer contained in this letter may be accepted by you in writing within 14 days of the date of this letter.
We also note that the terms of this offer were communicated to you orally in the Mediation Conference in the State Administrative Tribunal held 23 September 2014[.]
16 The applicants submit that it is not clear what is meant by the phrase 'if you proceed to a trial of this matter (or proceed generally with it)' and therefore they could not properly assess the offer. We do not accept this submission. In context, the reference to 'or proceed generally' covered the position that the matter might be resolved after rejection of the offer, but before trial. This would occur if the applicants had decided to withdraw. It might also have occurred if the applicants had requested a further attempt at mediation and the matter was settled subject to the respondent's right to apply for costs based on the settlement offer.
17 The applicants also submit that the offer of settlement did not address the replacement of the fence and that it was therefore not unreasonable to reject the offer. Again, the submission is not accepted. It was open to the respondent to assess that the applicants were unlikely to succeed with the claim that she would be required to reinstate the dividing fence because the claim had been brought out of time.
18 On any basis, the offer of settlement provides terms which were more favourable than the Tribunal's order dismissing the Principal proceedings. It is therefore necessary, pursuant to r 42(2) of the SAT Rules, that the Tribunal take into account that the applicants did not accept the offer.
19 Taking into account the offer of settlement, but weighing the factors identified above which militate against the award of costs, we find that the justice of the case requires only that the applicants make a contribution towards the respondent's costs.
20 The settlement offer was made on 26 September 2014. As indicated above, it is then, at the very least, at which the applicant should have given close focus to the weakness in their case, namely, that the complaint had been made out of time. We consider that the applicants should be ordered to pay the respondent's costs, to be fixed by the Tribunal, from 26 September 2014.
21 The respondent submits that costs should be awarded based on the maximum rates provided for in the Legal Practitioners (State Administrative Tribunal) Determination 2012 (WA) (Determination). This provides a maximum hourly rate for a senior practitioner of $374 per hour inclusive of GST, and in respect of counsel, an hourly rate of $297 and a daily rate of $2,970, inclusive of GST.
22 This submission overlooks that the rates given in the Determination are maximum rates. The Determination is used only as a guide because it reflects the maximum rates which may be charged by a legal practitioner in the absence of a written costs agreement. There is no scale of costs applicable to the Tribunal. We consider that the Determination is an appropriate guide having regard to the nature of this case, but the maximum rates should then only be allowed in cases, which by reason of importance to the client or complexity and such factors, warrant an award at the maximum rate. We do not consider that this is such a case and in the circumstances we will allow costs based at approximately 80% of the relevant maximum rate in respect of attendances subsequent to 26 September 2014. In the case of the respondent's legal practitioner, we have applied a rate of $330 per hour, inclusive of GST, and in respect of counsel, a rate of $270 per hour, and a daily rate of $2,700, inclusive of GST. The schedule of work undertaken provided in support of the cost application shows:
23 The total charges calculated in accordance with the above are therefore $10,507.50 which we have rounded down and fixed in the sum of $10,500.
24 For the above reasons, we conclude that the applicants should be ordered to pay a contribution to the respondent's costs, fixed in the sum of $10,500. We shall accordingly cause an order to issue as follows:
I certify that this and the preceding [24] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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