Ngo v Sin & Partner Pty Ltd

NCAT Appeal Panel|2024-11-12

Background

On 1 August 2024 we published our decision dismissing this appeal and made directions concerning costs of the appeal. The directions required the Respondent to the appeal to make an application for costs, should it desire to do so, within 14 days, by filing and serving evidence and submissions in support, and thereafter, the Appellant was given time to file and serve evidence and submissions opposing the Respondent's application for costs. The parties were also given an opportunity to make submissions as to whether they objected to the Appeal Panel dispensing with a hearing on costs and deciding the issue of costs on the papers.
The submissions have now been received and this decision constitutes our decision on whether the Respondent should have an order in its favour to the effect that the Appellant pay the Respondent's costs incurred in the appeal.
The dispute between the parties concerned provisions of the Retail Leases Act 1994 (NSW) (the RL Act). The Appellant was the lessee under the RL Act and the Respondent the lessor. The Appellant brought an application in the Consumer & Commercial Division of the Tribunal seeking relief as a result of being an impacted tenant under the Retail and Other Commercial Leases (Covid-19) Regulations 2020 (NSW) and its various successors (the Covid Regulations). At first instance the Tribunal found that the Tribunal did not have jurisdiction to alter the provisions of the lease so as to reduce the rent payable by the Appellant and nor did the Tribunal have jurisdiction to grant to the Appellant a further 24 month extension in the term of the lease. As a result, the Appellant's application was dismissed.
In the appeal, the Appellant sought to overturn the reasoning and the decision of the Tribunal at first instance. However, we were of the opinion that the Tribunal was not in error and the appeal was dismissed. We agreed with the Tribunal at first instance that the Covid Regulations did not provide power to the Tribunal to make the orders sought by the Appellant and thus the view of the Tribunal was that there was no jurisdiction to make the orders sought.

The Respondent's submissions

In support of the Respondent's application for an order for costs of the appeal to be made in its favour, the Respondent has provided written submissions, the effect of which may be summarised as follows: 1. The Respondent seeks an order for indemnity costs in the sum of $5,600. 2. The Respondent consents to the Appeal Panel deciding costs on the papers and dispensing with a further hearing as to costs. 3. The Respondent engaged its solicitors, Helen Sin Legal Pty Ltd to act for it in the appeal. The submissions attach a copy of the costs agreement. 4. The submissions state that the Respondent and Helen Sin Legal Pty Ltd are related in the sense that Helen Sin is a shareholder and a director of both the Respondent and the law firm constituted by Helen Sin Legal Pty Ltd. The Respondent and Helen Sin Legal Pty Ltd also share a second shareholder namely Kam Fan Sin. 5. In this case the Respondent is entitled to have legal representation: see sch 4 cl 7(b) of the Civil and Administrative Tribunal Act, 2013 (NSW) (the NCAT Act). 6. The costs agreement provides that Helen Sin has a charge out rate of $500 per hour plus GST and for Dr Kam the charge out rate is $900 per hour plus GST. 7. The Respondent submitted that it is entitled to indemnity costs upon the basis that there was a single issue in the appeal, namely whether the Tribunal had jurisdiction. The Respondent submitted that the Appellant did not address that question in the material he lodged. Additionally, the Respondent submitted that the Appellant abused the legal process by running his appeal concurrently with another application in the Tribunal seeking the same orders on the basis of the same evidence. 8. Indemnity costs should be awarded where the losing party has no chance of success: see Mendonca v Tonna [2017] NSWCATAP 176. That case is also authority for the view that indemnity costs may be warranted where the proceedings amount to an abuse of process, or where there has been unreasonable conduct. 9. Indemnity costs were sought relying upon s 60(3) of the NCAT Act which refers to cases where there is no tenable basis in law. 10. The Respondent also contended that the appeal was frivolous or vexatious and was being prosecuted for purposes other than in good faith or for an ulterior or collateral purpose. The Respondent referred to other proceedings before the Tribunal raising the same or similar issues. The submissions provide particulars of other proceedings brought by the Appellant in the Tribunal. 11. Attached to the submissions is an invoice rendered by Helen Sin Legal Pty Ltd to the Respondent in respect of work done in opposing the appeal and which totals $5,600.

Appellant's submissions

The written submissions of the Appellant may be summarised as follows: 1. During the hearing of the appeal, Dr Kam stated that he had been retired for more than 20 years. 2. Costs should not be awarded because the Respondent and the legal representative are related entities. 3. The Respondent breached requirements of legislation in seeking to obtain possession of the retail shop from the Appellant.
The Appellant's written submissions do not state whether the Appellant consents to the issue of costs being determined on the papers without the need for a further hearing.

Consideration

Pursuant to s 50 of the NCAT Act the Appeal Panel has the discretion to dispense with a hearing if it is satisfied that the issues for determination can be adequately determined in the absence of the parties by considering any written submissions or other documents or material lodged with or provided to the Tribunal.
We are satisfied that the issue of costs can be adequately determined in the absence of the parties by considering the parties' written submissions. In our view, the parties would be put to unnecessary expense if a hearing on costs was held.
An order dispensing with a hearing under s 50(1)(c) of the NCAT Act has accordingly been made.
By s 45 of the NCAT Act it is provided that a party to proceedings in the Tribunal has the carriage of the party's own case and is not entitled to be represented by any person. However, leave can be granted for a party to be represented. This is the general position, but it is subject to exceptions. One exception is contained in sch 4 cl 7, where it is provided that despite s 45 a party to proceedings concerning the RL Act is entitled to be represented by an Australian lawyer.
Section 60 of the NCAT Act deals with costs and provides that the general position is that each party to proceedings in the Tribunal is to pay the party's own costs. However, 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". In determining whether there are special circumstances warranting an award of costs the Tribunal may have regard to those matters set out in s 60(3). The terms of s 60 provides as follows: 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. (4) If costs are to be awarded by the Tribunal, the Tribunal may-- (a) determine by whom and to what extent costs are to be paid, and (b) order costs to be assessed on the basis set out in the legal costs legislation (as defined in section 3A of the Legal Profession Uniform Law Application Act 2014) or on any other basis. (5) In this section-- "costs" includes-- (a) the costs of, or incidental to, proceedings in the Tribunal, and (b) the costs of, or incidental to, the proceedings giving rise to the application or appeal, as well as the costs of or incidental to the application or appeal.
The Civil and Administrative Tribunal Rules 2014 provide exceptions to these general principles referred to in s 60 but as no reliance has been placed on those provisions (the relevant ones being r 38 and 38A) we have not considered them.
The basis for the appeal being dismissed was that the Tribunal had no jurisdiction to determine the claim brought by the Appellant or to make the orders sought. That was the result of the decision at first instance and we, as the Appeal Panel, had the same view.
The critical issue to be addressed by the Appellant was the lack of jurisdiction and it cannot be said that the Appellant was taken by surprise in relation to this being the critical issue.
By s 60, before making an order for costs, we must be satisfied that there are special circumstances warranting such an award. One example of "special circumstances" is that the proceedings have no tenable basis. In our view this is a fair description of the appeal. The appeal raised issues and sought orders that were not available under the Covid Regulations. In that sense the appeal had no tenable basis in fact or law.
Accordingly, we are of the view that special circumstances exist. The next question is whether those circumstances warrant an award for costs. Because the issue was addressed and decided at first instance (and therefore there was time for the Appellant to consider whether the appeal had prospects for success), we are of the view that the special circumstances do, in this case, warrant an award for costs.
The Respondent seeks costs on an indemnity basis. It provides a number of reasons for making that submission. One such basis is that the proceedings had "no chance of success". In our view that was the case here, and therefore an order for indemnity costs is warranted.
There is a relationship between the Respondent and its legal representative. We drew this to the attention of the parties in the directions because we were concerned that such a relationship might potentially involve a claim for costs which could not be considered as reasonable compared with a retainer agreement entered into at arm's length.
We have been provided with a costs agreement which appears to follow the usual form and there is no submission from the Appellant that it does not. We have also been provided with the invoice for legal services rendered by Helen Sin Pty Ltd to the Respondent totalling $5,600. There is no evidence or submissions that that amount was inflated or is unreasonable. On its face, it appears to be for a figure which could be fairly considered as reasonable for the costs of preparing to defend the appeal and to attend the hearing of the appeal, including preparation of written submissions.
The Appellant stated that Dr Kam conceded at the hearing that he had been retired for a number of years. The retainer agreement describes him as a solicitor and the invoice shows that he did most of the work. As long as he remains a solicitor (albeit retired) there is nothing precluding him from doing legal work on behalf of Helen Sin Legal Pty Ltd. In those circumstances Helen Sin Legal Pty Ltd is entitled to charge its client, the Respondent for the work done by Dr Kam.
In conclusion, we are of the opinion that the claim for indemnity costs in the sum of $5600 is warranted.
Accordingly, we make the following order: 1. A hearing on costs is dispensed with in accordance with s 50(2) of the Civil and Administrative Tribunal Act 2013. 2. The Appellant is to pay the Respondent's costs of the appeal in the sum of $5,600. Such payment to be made within 21 days or such longer period as may be agreed between the parties.

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: 12 November 2024

Civil and Administrative Rules 2014(NSW)

Retail and Other Commercial Leases (Covid-19) Regulations 2020(NSW)

At a glance

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Judgment (5 paragraphs)

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Legislation Cited (4)

Cases Cited (1)