Nastav v Commissioner of Police, NSW Police Force

NCAT Occupational|2018-07-31

Summary

These reasons deal with the respondent Commissioner's application for costs of these proceedings.
The background to this application is that on 27 September 2017, the Commissioner decided to revoke the applicant's Class 1ABCDE, 2ABC security licence on the basis that the applicant had provided false or misleading information to officers of the Security Licensing & Enforcement Directorate (SLED) and to this Tribunal (the Decision). The Commissioner considered that it was not in the public interest for the applicant to continue to hold the security licence.
The applicant sought an internal review of the Decision. The Decision was upheld on 8 November 2017. In addition to finding that it was in the public interest that the applicant's Licence be revoked, the delegate also found that the applicant was not a fit and proper person to hold a security licence.
The applicant then sought a review of the Decision by this Tribunal. On 18 May 2018, I decided to affirm the Decision: Nastav v Commissioner of Police, NSW Police Force [2018] NSWCATOD 71.
For the following reasons, I have decided that the applicant should pay the Commissioner's costs in the fixed amount of $21,334.00.

Submissions

The Commissioner filed written submissions on 26 June 2018. In summary, he says:

Are there circumstances warranting an order that the applicant pay the Commissioner's costs?

The relevant costs rule appears in s 60 of the Civil and Administrative Tribunal Act 2013 (NSW) (the Act). That section provides: 60 Costs (1) Each party to proceedings in the Tribunal is to pay the party's own costs. (2) The Tribunal may award costs in relation to proceedings before it only if it is satisfied that there are special circumstances warranting an award of costs. (3) In determining whether there are special circumstances warranting an award of costs, the Tribunal may have regard to the following: (a) whether a party has conducted the proceedings in a way that unnecessarily disadvantaged another party to the proceedings, (b) whether a party has been responsible for prolonging unreasonably the time taken to complete the proceedings, (c) the relative strengths of the claims made by each of the parties, including whether a party has made a claim that has no tenable basis in fact or law, (d) the nature and complexity of the proceedings, (e) whether the proceedings were frivolous or vexatious or otherwise misconceived or lacking in substance, (f) whether a party has refused or failed to comply with the duty imposed by section 36 (3), (g) any other matter that the Tribunal considers relevant.
The section has been considered in many cases and its effect can be summarised as follows:

"special circumstances" are circumstances that are out of the ordinary, they do not have to be extraordinary or exceptional;
the discretion to award costs must be exercised judicially and having regard to the underlying principle that parties to proceedings in the Tribunal are ordinarily to bear their own costs;
each situation must be assessed on a case by case basis to see whether or not special circumstances exist so as to warrant the award of costs, see eMove Pty Ltd v Naomi Dickinson [2015] NSWCATAP 94 at [48].

Further, if a costs applicant establishes that some of the circumstances in s 60(3) apply, it does not necessarily follow that a costs order should be made: Abughazaleh v Commissioner of Police, NSW Police Force; Sydney Training Academy Pty Ltd v Commissioner of Police, NSW Police Force [2018] NSWCATAD 30 at [38]). The Tribunal must "weigh whether those circumstances are sufficient to amount to special circumstances that justify departing from the ordinary rule that each party bear their own costs": Obieta v Australian College of Professionals Pty Ltd [2014] NSWCATAP 38 at [81]. In other words, even where special circumstances exist, the Tribunal has a discretion to exercise in deciding what, if any, order should be made: Brodyn Pty Ltd v Owners Corporation - Strata Plan 73019 (No 2) [2016] NSWCATAP 224 at [21] and [24].
The Commissioner relies principally on the Tribunal's findings that:

the applicant had misled the Tribunal on two previous occasions, and SLED in an interview conducted on 26 June 2017; and
the applicant arranged for CXA to work at the Camden Show in breach of his bail conditions, fabricated roster documents to protect CXA and gave evidence for CXA as a representative of Southern Cross Protection Pty Ltd when he was not authorised to do so.

The Commissioner submits that the fact of the applicant's dishonesty and untruthful grounds for review warrant a finding of special circumstances. He submits that the applicant's behaviour before the Tribunal was deceitful and misleading, and represented a disregard for the law and principles pertaining to security licensing in NSW (see the Decision at [54]).
I agree. The Tribunal has found on a number of occasions that dishonesty can amount to special circumstances: Abughazaleh v Commissioner of Police, NSW Police Force; Sydney Training Academy Pty Ltd v Commissioner of Police, NSW Police Force [2018] NSWCATAD 30; Ahmed v Commissioner of Police, NSW Police Force [2017] NSWCATOD 113.
In Abughazaleh, the Tribunal stated at [33]: I am satisfied that a party's dishonesty is a relevant matter to take into account in the exercise of this discretion. Where a party brings proceedings which are based upon evidence the Tribunal finds to be untruthful, the party is using the tribunal processes for fraudulent ends. The other party is put to the time and expense of responding to proceedings which are, to some extent at least, not brought and pursued in good faith. This circumstance is "out of the ordinary": Megerditchian v Kurmond Homes Pty Ltd [2014] NSWCATAP 120 at [11].
I am satisfied that, having regard to the dishonesty of the applicant, there are special circumstances warranting an award of costs.

Should costs be awarded on the indemnity basis?

The authorities establish that indemnity costs are only awarded in limited circumstances. The discretion to do so must be the subject of careful reasoning, and caution should be exercised in making such an award: Degmam Pty Ltd (In Liq) v Wright (No 2) [1983] 2 NSWLR 354. In Mendonca v Tonna [2017] NSWCATAP 176 at [64], the Appeal Panel held that misconduct of a serious nature, such as fraud, perjury, contempt or dishonesty is conduct that may justify costs being awarded on an indemnity basis. Mendonca was followed by the Tribunal in Abughazaleh where it ordered that costs be paid on the indemnity basis. The Tribunal found that the giving of false evidence by Mr Abughazaleh was serious misconduct, which justified an award of indemnity costs against him and against the company he wholly controls.
In the present case, I have made findings of serious misconduct against Mr Nastav. These included findings that he:

misled the Tribunal on 10 January and 9 May 2017 in the course of CXA's application for a stay of the revocation of CXA's security licence;
did not provide truthful answers on 28 June 2017 when he was interviewed by officers of SLED;
knowingly allowed CXA to work "on patrol" on no less than 19 occasions, including on 10 January 2017, with full knowledge of CXA's stay conditions and his parole conditions;
knowingly provided a reference for CXA to the Tribunal when he was not authorised to do so; and
fabricated roster documents to conceal the fact that CXA was performing his duties at the site specified in the stay orders.

All these findings reflect dishonesty on the part of Mr Nastav. I am satisfied that his dishonesty is a relevant matter to take into account in the exercise of my discretion. By so acting, Mr Nastav has used the tribunal processes for fraudulent ends: Megerditchian. The Commissioner has been put to the time and expense of responding to proceedings which are, to some extent at least, not brought and pursued in good faith.
In these circumstances, I think it appropriate to order that the Commissioner's costs be paid on the indemnity basis.

Should costs be awarded in the fixed amount of $21,334.00?

In both Ahmed and Abughazaleh the Tribunal awarded costs in a fixed amount. It is clear that the Tribunal is empowered to do so, and has done so in many cases: see s 60(4)(a) of the Civil and Administrative Tribunal Act 2013 (NSW), which gives the Tribunal discretion to determine to what extent costs are to be paid: 203 Castlereagh Street Pty Limited v Skybloo Holdings Pty Limited [2017] NSWCATAP 29 at [35].
In 203 Castlereagh Street, the Appeal Panel discussed the relevant principles concerning when a Court or tribunal might make a gross sum costs order, and considered a number of Court of Appeal decisions. The Appeal Panel stated a fixed sum costs order may be appropriate where:

the sum of costs in question is relatively modest;
a party obliged to pay the costs would not be able to meet a liability of the order likely to result from the assessment;
the assessment of costs would be protracted and expensive;
the case was complex;
the power to make a fixed sum costs order should only be exercised when the Tribunal considers that it can do so fairly between the parties, and that includes sufficient confidence in arriving at an appropriate sum on the materials available.

The Commissioner relies on an affidavit of his solicitor Mr Zoppo affirmed 25 June 2018. He states that the costs of the Commissioner in defending the application are $21,334.00. He states that his costs to the Commissioner were charged at reduced rates, and that work was undertaken by a junior solicitor where appropriate. Additional costs were avoided by Mr Zoppo appearing at the hearing rather than engaging counsel, thereby avoiding additional costs.
The "guiding principle" for the NCAT Act and the procedural rules, in their application to proceedings in the Tribunal, is to facilitate the just, quick and cheap resolution of the real issues in the proceedings: s.36(1). The Tribunal must seek to give effect to the guiding principle when it exercises any power given to it by this Act: s 36(3)(a).
In addition, the practice and procedure of the Tribunal is to be implemented so as to facilitate the resolution of the issues between the parties in such a way that the cost to the parties and the Tribunal is proportionate to the importance and complexity of the subject-matter of the proceedings: s 36(4).
Given the amount in issue, I consider it would be disproportionate and contrary to the guiding principle to require either party to now have to have the costs assessed. This would add further delay and further expense to what has already occurred. Consistent with the proportionality principle the appropriate course is for the Tribunal to determine the costs to be paid.
For the above reasons, the applicant is to pay the respondent's costs on the indemnity basis in the sum of $21,334.00.

Other

In my directions, I indicated my preliminary view that this costs application be decided without a hearing. I asked the parties to provide submissions on this matter. The Commissioner submitted that his costs application be determined on the papers and without a hearing. The respondent made no submission about this.
In the circumstances, it is appropriate that a hearing is dispensed with pursuant to s 50(1)(c) of the NCAT Act.
Finally, one of the reasons advanced by Mr Nastav for not making a costs order against him was his lack of funds. Having found that he should pay the Commissioner's costs, Mr Nastav's impecuniosity is not a justifiable reason for changing that view. However, this may be a factor in the Commission determining whether or not to recover his costs, and/or entering into an arrangement for the recovery of those costs.

Order 1. A hearing is dispensed with pursuant to s 50(1)(c) of the Civil and Administrative Tribunal Act 2013 (NSW). 2. The applicant is to pay the respondent's costs on the indemnity basis in the sum of $21,334.00. 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: 20 April 2023

At a glance

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Judgment (7 paragraphs)

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Cases Cited (9)