Noor v The Owners-Strata Plan No 72939

NCAT Appeal Panel|2023-10-03

Summary

This appeal solely concerns a decision made as to costs in proceedings in the Consumer and Commercial Division after it resolved a dispute between the parties under the Strata Schemes Management Act 2015 (NSW)(SSMA).
The primary decision, being the dismissal of the appellant's claims, was later set aside and remitted, in part, to the Division for redetermination: Noor v The Owners - Strata Plan No 72939 [2023] NSWCATAP 236. That decision of the Appeal Panel was published on 24 August 2023, although there were minor amendments to the decision made subsequently, and a revised decision was subsequently published. The Tribunal at first instance is yet to redetermine the remitted proceedings.
In this appeal decision a reference to the "substantive" appeal decision is a reference to the Appeal Panel decision first published on 24 August 2023.
At the last possible opportunity, after oral submissions had closed in the hearing of the appeal before us, the respondent conceded the appeal should be allowed, but subject to the cost order made by the Tribunal at first instance being an order that the appellant pay the respondent's costs of the part of the appellant's claim that was unsuccessful and was not disturbed on appeal.
We agree that the appeal should be allowed and given the respondent's concession will give only truncated reasons in that regard. The parties remain at odds as to how the appeal should otherwise be disposed of. For the reasons set out below, we have decided to remit the determination of the issue of costs to the Division, if pressed, once the primary proceedings have been redetermined.

Scope and nature of internal appeals

To succeed in an appeal from an ancillary order such as this one, the appellant must demonstrate either an error on a question of law which may be argued as of right; or that permission (that is, "leave") to appeal should be granted to bring the appeal: NCAT Act, s 80(2).
The principles governing an application for leave to appeal under the NCAT Act are well-established and are repeated in many decisions of the Appeal Panel, often quoting Collins v Urban [2014] NSWCATAP 17. They are the same principles applied by the courts. It is enough as a summary to refer to the Secretary, Department of Family and Community Services v Smith [2017] NSWCA 206, where the Court said at [28] (citations omitted): Only if the decision is attended with sufficient doubt to warrant its reconsideration on appeal will leave be granted. Ordinarily, it is only appropriate to grant leave where there is an issue of principle, a question of general public importance, or an injustice which is reasonably clear, in the sense of going beyond what is merely arguable. It is well established that it is not sufficient merely to show that the trial judge was arguably wrong.
Where the appeal is from a decision made in the Consumer and Commercial Division (other than in respect of interlocutory decisions), there is a further qualification to the possible grant of leave in that we may only go on to consider a grant of leave in the broader sense if we are first satisfied that the elements of cl 12(1) of Sch 4 of the NCAT Act are made out, in that the appellant may have suffered a substantial miscarriage of justice on the basis that: 1. the decision of the Tribunal under appeal was not fair and equitable; or 2. the decision of the Tribunal under appeal was against the weight of evidence; or 3. significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with).

An appeal commenced out of time.

The appeal was not commenced within time. However, given the short delay and the respondent's eventual concession that the appeal should be allowed, we will extend time for lodging the Notice of Appeal.

Consideration

There are several bases on which the Tribunal can be seen to have erred: 1. Firstly, the Tribunal appears to have proceeded on the basis costs follow the event, without addressing why r 38 of the NCAT Rules applied and displaced the primary position in s 60 of the NCAT Act that each party is to pay their own costs unless there are special circumstances warranting an order as to costs: Reasons at [14]; 2. Secondly, the findings as to special circumstances are not referred to as a separate basis for an award as to costs but, rather, are linked to the finding that costs should follow the event by the use of the word "and" between those considerations in the Reasons at [14]. 3. Thirdly, whilst the Tribunal went on to make findings that there were special circumstances, it made no reference to, or finding that, the special circumstances warranted an order, indicating that it may have asked itself the wrong question: Reasons at [14]. A finding of special circumstances simpliciter is not a proper basis for an award of costs under s 60 of the NCAT Act. The Tribunal must also be satisfied they are circumstances "warranting an award of costs": The Owners-Strata Plan 63731 v B & G Trading Pty Ltd (No 2) [2020] NSWCATAP 273 at [10]-[15]; and 4. Given the Tribunal considered that costs should follow the event, it would be manifestly and obviously unjust to let the costs decision under appeal remain in place where the "event" is now uncertain given the decision in the substantive appeal decision.
Those findings sufficiently demonstrate that the decision was not fair and equitable, leaving a chance that is fairly open that a different and more favourable result would have been achieved by the appellant in a material sense.
For those reasons, to the extent required leave to appeal should be granted and the appeal should be allowed.

Can we redetermine the issue of costs?

When conceding the appeal should be allowed, the respondent submitted that we could redetermine the issue and pressed for an order that the appellant pay its costs solely in relation to the loss of rent claim made by the appellant at first instance. It should be recalled that appellant failed in respect of that aspect of the substantive appeal. The findings of the Tribunal as to special circumstances also related to those aspects of the appellant's claim at first instance.
We are not satisfied that we could or should redetermine the issue, for the following reasons: 1. Despite the manifest strength of the appeal, the respondent's position altered far too late for the non-legally represented appellant to have a procedurally fair opportunity to address the outcome now sought; 2. Where there was no finding that the special circumstances warranted any costs order, we do not think it appropriate that we redetermine the issue, noting that if we do so any appeal from our decision would lie only to the Supreme Court and only on a question of law: NCAT Act, s 83(1); and 3. We do not think the exercise of the costs discretion should occur until the outcome of the proceedings at first instance is known, in full. The application for costs involves a single exercisable discretion that should be undertaken with full knowledge of all relevant circumstances.
For those reasons, the issue should be remitted for redetermination, if pressed, after the Tribunal redetermines the substantive claims remitted to it.

The Tribunal's factual findings about special circumstances

However, because the appellant challenged the factual findings of the Tribunal which it considered to be special circumstances in respect of the loss of rent claim, and that issue is not remitted for redetermination, we should separately consider the challenges to those findings. If the member erred in factual findings potentially constituting special circumstances in relation to issues not remitted, and we do not correct that, the error will simply be continued in the redetermination of the costs issue if it arises again.
We acknowledge that the findings challenged all relate to an aspect of the appellant's claim that failed at first instance and in the substantive appeal (being the claim for lost rent), however the conduct of the claim is what is relied upon as special circumstances, not the outcome.
For that reason, we will consider whether to grant leave in respect of the appellant's challenges to the Tribunal's factual findings. However, we will only do so where, and to the extent, those findings were referred to as constituting special circumstances in respect of costs on issues not remitted to the Tribunal. Accordingly, a factual finding on an issue of credit or non-compliance with Tribunal directions made in the costs decision of the Tribunal is not a factual finding in the remitted proceedings.
In that regard, several findings are challenged: 1. The lack of any tax information or tax records supporting a claim for lost rent: Reasons at [10] - The appellant asserts that the Tribunal was in error in making this finding but has only done so by assertion. Contrary to directions made in the appeal, no evidence has been put before us to establish that the Tribunal's finding was incorrect. Whilst the appellant asserts the Tribunal erred in its substantive decision refusing her application by finding that her accountant was unwell, when the evidence was that he had died, the reasons read fairly and as a whole do not support the relevant challenge. We were taken to evidence that, whilst the appellant's accountant had died a month before the hearing at first instance, it was his asserted prior illness that had been the alleged source of the appellant's long term inability to produce relevant tax records. This is not an issue of general principle or public importance. This allegation of error does not rise beyond the merely arguable and no grant of leave to challenge it is warranted; 2. The issues around the appellant's husband's bank records and the appellant's unjustified "reluctance to produce them" or to produce them in an unredacted form: Reasons at [11] - Again the appellant asserts that the Tribunal erred and relies upon an assertion that she, and we infer her husband who represented her, misunderstood the summons process. However, there is no other evidence before us to support those allegations. This is not an issue of general principle or public importance. This allegation of error does not rise beyond the merely arguable and no grant of leave to challenge it is warranted; 3. The appellant's husband's conduct in evidence before the Tribunal, leading to a finding that he was "not frank" but was "evasive and appeared to change [his position] from time to time to suit how matters were evolving": Reasons at [12] - The appellant indicated that this issue could not be demonstrated by mere transcription of part, or all, of her husband's evidence. She invited the Appeal Panel to listen to the audio recording of her husband's cross-examination in full. Having done so, we are satisfied the Tribunal's finding was reasonably open to it, the more so where appropriate acknowledgement is made of the advantage the Tribunal had of observing the witness in evidence: Fox v Percy 214 CLR 118; [2003] HCA 22 at [48]. This is not an issue of general principle or public importance. No grant of leave is warranted.

Orders

Our Orders are as follows: 1. Grant the appellant leave to extend time to lodge the Notice of Appeal to the date of lodgment; 2. To the extent required, leave to appeal is granted except in respect of the Tribunal's factual findings; 3. The appeal is allowed; 4. The decision of the Tribunal on 12 July 2023 in proceedings SC 21/38944 is set aside; 5. Remit the determination of the issue of costs, if pressed, to the Tribunal once the primary proceedings have been redetermined, with the admission of relevant new evidence on the issue of costs at the discretion of the Tribunal redetermining the matter.

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: 10 October 2023

At a glance

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Judgment (9 paragraphs)

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Legislation Cited (3)

Cases Cited (5)