Owners Corporation No. 1 PS542645C v Filippou Management Pty Ltd (Civil Claims) [2010] VCAT 2085

**1. Hearing with respect to the reinstatement of glass sliding doors is adjourned to 14 February 2011 and if not renewed by the applicant before that date, the application will be considered withdrawn.

2. The Tribunal orders Filippou Management Pty Ltd (ACN: 120 880 604) to pay the costs of Owners Corporation No. 1 PS542645C in this proceeding including reserved costs:

a. from 1 July 2009 to 6 May 2010 in accordance with Scale D of the Rules of the County Court to be assessed by the Victorian Costs Court in default of agreement;

b. from 7 May 2010 to and including 14 December 2010 on a full indemnity basis with the intent the applicant will be fully indemnified for all costs except to the extent that any item is unreasonably incurred or is an unreasonable amount, to be assessed by the Victorian Costs Court in default of agreement.

Sweetvale Pty Ltd v Minister for Planning [2004] VCAT 2000 (8 October 2004)

Martin v Fasham Johnson Pty Ltd [2007] VSC 54

Colgate Palmolive Pty Ltd v Cussons Pty Ltd [1993] FCA 536; (1993) 46 FCR 225

Ugly Tribe Co Pty Ltd v Sikola [2001] VSC 189

Mardel Constructions Pty Ltd v Sinha (Domestic Building) [2009] VCAT 1532 (3 August 2009)

Pacific Indemnity Underwriting Agency Pty Ltd v Maclaw No 651 Pty Ltd & Anor [2005] VSCA 165 (29 June 2005)

Maltall Pty Ltd & J. & C. Iliopoulous v Bevendale Pty Ltd No. 2, 10 November 1998, (1999) V ConvR 58-528

1. The Q2 Building is a relatively new office building in Queen Street in Melbourne's CBD. It comprises 12 floors with retail space on the ground floor, office space above and a 'Corporate Centre'. It is structured as an owners corporation with approximately 110 lots.
2. Filippou Management Pty Ltd (Filippou) owns and lets (or owned) all the lots on the ground floor.
3. Mr Spiros Kalotihos is a director and operations manager of Filippou.
4. This proceeding commenced in November 2008 under the Owners Corporation Act 2006. Owners Corporation No. 1 PS542645C (the OC) sought orders with respect to fees (issue resolved by consent in December 2008 ) and concerning works around the ground floor foyer of the building in question by Filippou.
5. By terms of settlement dated 6 January 2009, the parties recorded,

... in consideration of the ... fees being paid and our undertaking that glass doors in front of the lifts will be re-instated as soon as the shop fit outs for respective tenants have been completed, the owners corporation consents to cancelling of all VCAT proceedings and allows Fillipou Management P/L to complete the respective shop fitouts without delay or interuption.

1. In February 2009, VCAT gave leave to the OC to withdraw the application with a right of reinstatement. To this point, costs were not sought or ordered.
2. In July 2009, VCAT reinstated the application at the request of the OC. In September 2009, VCAT held a compulsory conference with respect to five separate proceedings at VCAT between the parties. In this proceeding, the matter of the glass door was again settled. Filippou was to "reinstate glass sliding doors in front of the lifts in the foyer" at the latest within ten weeks.
3. It appears from the VCAT proceeding file that VCAT mistakenly reinstated this matter on 16 November 2009, when dealing with related proceedings between the parties. This was addressed by orders in December 2009.
4. However, in a separate proceeding, Filippou then made a wide-ranging application against the OC, its manager and others. In January 2010, VCAT made orders on the basis this proceeding was on foot.
5. I heard all related applications in March 2010 and in this proceeding ordered the glass doors be reinstated by 31 March 2010.
6. On 13 April 2010, the OC sought orders that Filippou be ordered to pay $40,700 so the OC could reinstate the doors.
7. By letter dated 22 April 2010, Filippou sought a further 14 days to reinstate the glass doors. It said, following my orders of March 2010, Filippou had in its possession the original glass doors. By that time, due to works undertaken by Filippou within its lot, they could not simply be reinstalled. Stairs had to be reconfigured, which required a building permit. The permit was granted on 11 March 2010. Filippou obtained a quote dated 5 March 2010. Before works could be done, Flinders Street was flooded by rains. Manually operated sliding doors were installed in front of the bottle shop. The other doors were put into storage pending completion of the stair work (which began "well before 31 March 2010) but were then damaged by a tradesperson. A replacement door was sought. While Filippou had advised the OC by telephone as to the progress, in mid April 2010, the OC sought further orders from VCAT.
8. By orders in chambers of 7 May 2010, I gave Filippou until 18 May 2010 to reinstate the glass doors.
9. On 9 June 2010, I conducted a hearing, intending it to be the final hearing between the parties on another fee claim by the OC, a costs application and the glass door issue. My orders of 13 July 2010 tell the story,

By the hearing before me on 9 June 2009, the issue was still not resolved. At the end of the hearing, with the building being close to the Tribunal, I and the parties viewed the site. It was apparent that "reinstating the glass doors" is no simple matter.

I understand that at the time and the respondent removed the glass doors they were sliding doors on the southern side of the ground floor foyer. Due to works by the respondent within its lot, there are great difficulties in reinstalling the automatic closing doors. The set of doors closer to be front entrance of the building may now not have sufficient room about them to install automatic closing doors. Neither are they frosted, giving everyone who enters through the foyer and unfortunate view into a storage area. The respondent says it is willing to frost the glass and keep the doors closed. The body corporate manager is somewhat sceptical about whether the doors would be kept closed.

The removal of the doors further from the front door, is more problematic. The respondent is installing a mezzanine level within the lot. A set of stairs at one point came to where the previously removed glass doors had been. Apparently due to building regulation issues, those stairs have been demolished and stairs with a return installed. The doors will now have to be at the corner where the southern wall of the foyer meets the eastern wall of the foyer. Unfortunately, this will create a situation where the door of the toilet which can be accessed from the ground floor foyer will, when opened, open across the sliding door. It seems questionable whether this will be approved by building authorities. It is certainly most unsatisfactory from the Owners Corporation's point of view.

It appears there is no proposition before me as to what I might order to satisfactorily remedy this situation. Both the quotes for $40,700 and the lower amount do not appear to have been obtained with a view to addressing the current situation. It is not apparent to me what non-monetary orders I might reasonably make to enforce the agreement that the glass doors be reinstated.

Therefore, I direct the Owners Corporation at a time of its choosing and the respondent within 14 days, to put submissions to me (and serve them on the other party) on the appropriate orders.

It has been some weeks since I visited the site. It may be there have been developments in terms of the progress of the building works and required approvals of which is at least the respondent is aware. I direct the respondent to advise me of any developments.

1. On 27 July 2010, Filippou filed a written submission, proposing,
   1. The glass windows in front of the liquor shop, facing the foyer, to be frosted to obscure any view into the liquor shop.
   2. If the [OC] prefers, once the glass is installed in front of the stairs, this glass could also be frosted to conceal the stairwell.
2. On 18 October 2010, the OC submitted in writing that Filippou should be required to reinstate the glass doors within seven days and in default the OC would obtain quotes. The OC said it would seek costs with respect to this issue.
3. On 18 October 2010 I listed the matter for a final hearing on 14 December 2010 saying and ordering (costs reserved),

**On 13 July 2010, I made directions in this matter (about the door dispute) which in part directed the Owners Corporation at a time of its choosing and the respondent within 14 days, to put submissions to me (and serve them on the other party) on the appropriate orders.

On 9 August 2010, I made directions and noted that on 27 July 2010, Filippou Management Pty Ltd filed written submissions about the building claim and I assume served them on the Owners Corporation. I said I await a submission from the Owners Corporation.

On 18 October 2010, the Owners Corporation filed written submissions.

a) Either the sliding doors installed in the foyer or the windows of the liquor shop be frosted. It has previously submitted it is not physically possible to install an automatic door closer for these doors.

b) If the applicant prefers, once the glass is installed in front of the stairs, this glass could also be frosted to conceal the stairwell.

a) The sliding doors installed in the foyer be frosted and an automatic door closer be reinstalled.

b) The glass installed in front of the stairs be frosted to conceal the stairwell.

c) The respondent pay the applicants costs on an indemnity basis.

On my own initiative, without notice to the parties I have twice visited the foyer during lunchtime. On both occasions, the doors in front of the liquor store were open. The view of boxes in the liquor store was unsightly. On my first visit, works were underway around the stairwell. On my second recent visit (this week), it seemed works were complete. However, the glass door was open. Wires were visible overhead. It appears the self-closer was not operating.

a) Within 14 days the respondent frost both the sliding doors installed in the foyer and the windows of the liquor shop;

b) The respondent provide the applicant access to the doors so that it may seek a quote to install an automatic self-closer. I note a tradesperson may advise it is not feasible to install an automatic self-closer.

c) Within 14 days the respondent frost the glass installed in front of the stairs (the doors and wall) to conceal the stairwell and make the doors operational.

d) The respondent provide the applicant access to all required areas so that it may seek a quote to frost the doors and wall in front of the stairs and make the self closer operational.

e) The respondent is to file and serve any quotes it seeks [to rely on].**

1. At the 14 December 2010 hearing, Mr A. Ball, solicitor appeared for the OC. Mr S. Kalotihos appeared for Filippou.
2. They advised the door issue was resolved. Fillipou had deposited $10,000 with the OC from which works would be paid. The end result will be two sets of self-closing frosted sliding glass doors facing into the foyer.
3. I heard the costs application. The OC sought costs on an indemnity basis or alternately costs at Scale D of the County Court Costs Scale. Filippou submitted each party should bear its own costs.
4. I reserved my decision.

1. Section 78 of the Victorian Civil and Administrative Tribunal Act 1998 (the VCAT Act) says,

(1) This section applies if the Tribunal believes that a party to a proceeding is conducting the proceeding in a way that unnecessarily disadvantages another party to the proceeding by conduct such as -

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

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

(c) asking for an adjournment as a result of (a) or (b); or

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

(g) failing to attend mediation or the hearing of the proceeding.

(2) If this section applies, the Tribunal may - ...

(3) The Tribunal's powers under this section are exercisable by the presiding member.

(1) Subject to this Division, each party is to bear their own costs in the proceeding.

(2) At any time, the Tribunal may order that a party pay all or a specified part of the costs of another party in a proceeding.

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

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

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

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

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

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

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

(c) the relative strengths of the claims made by each of the parties, including whether a party has made a claim that has no tenable basis in fact or law;

(e) any other matter the Tribunal considers relevant.

(4) If the Tribunal considers that the representative of a party, rather than the party, is responsible for conduct described in subsection (3)(a) or (b), the Tribunal may order that the representative in his or her own capacity compensate another party for any costs incurred unnecessarily.

(5) Before making an order under subsection (4), the Tribunal must give the representative a reasonable opportunity to be heard.

(6) If the Tribunal makes an order for costs before the end of a proceeding, the Tribunal may require that the order be complied with before it continues with the proceeding.

1. Morris J in Sweetvale Pty Ltd v Minister for Planning [2004] VCAT 2000 (8 October 2004) said (at paragraph 17),

Section 109 of the VCAT Act gives the tribunal a broad discretion in relation to costs. The existence of such a discretion enables the tribunal to do its best to provide a just outcome, subject to the basic principle that each party will usually bear its own costs. There is much to be said for the existence of such a broad discretion. But, equally, it is important that the obligation to pay costs be predictable; as this promotes certainty. A proper balance is likely to be promoted if decisions as to costs are only made after serious and close consideration of the statutory provisions; and then according to principles and practices that develop in relation to particular provisions, cases or lists.

In my opinion, for an award of costs to be made it is not sufficient to demonstrate that the nature of the proceeding has a strong resemblance to inter-parties litigation in a court. Section 109(1) of the VCAT Act is designed to cover proceedings in all lists of the tribunal, including those where proceedings are characteristically similar to those conducted in the County Court of the Supreme Court. But paragraph (d) of section 109(3) of the VCAT Act anticipates that certain types of proceedings will be brought before the tribunal which will be of a character to enable the tribunal to be satisfied that an order should be made as to costs. How are these cases to be identified? No doubt it would be convenient if a list of such cases was published. But I think it would be unwise to essay such a list; that will have to emerge over time.

What can be said is this. It is more likely that the nature and complexity of a proceeding will make it fair to make an order as to costs if:

* the proceeding was in the tribunal's original jurisdiction, not its review jurisdiction;

* the proceeding involved a large number of issues, or a small number of particularly complex issues;

* the proceeding involved a large sum of money or a major issue affecting the welfare of a party or the community;

* the proceeding succeeded and was a type which was required to be brought, either by reason of a statutory duty or by reason of some unlawful or improper conduct by another party which warranted redress;

* the proceeding failed and was a type where a party has asserted a right which it knew, or ought to have known, was tenuous;

* a practice has developed that costs are routinely awarded in a particular type of proceeding, thus making an award of costs more predictable for the proceeding in question.

I am satisfied that the present case is of a character which can found an award of costs. I rely upon the nature of the issues involved (which involved judicial review in the tribunal's original jurisdiction), the amount at stake, the commercial nature of the objectives sought to be achieved, the complexity of the legal questions, and the requirement that a presidential member hear the case. The high quality of counsel arguing the proceeding is an indicia of the importance and complexity of the case. I also take into account the tenuous nature of the claim as an additional factor, even though this would not be sufficient in itself to make it fair to award costs. I also believe these same factors mean that it is appropriate that costs be assessed on the Supreme Court scale.

1. Bell J in Martin v Fasham Johnson Pty Ltd [2007] VSC 54 at para 33 said of the above section,

Usually parties must bear their own costs, which no doubt reflects the general object of the Act. That object, as identified by the President [of the Tribunal], is to promote access to justice generally and to minimise the overall level of costs in tribunal proceedings as far as practicable.

The considerations relevant to the exercise of the Tribunal's costs discretion are specified in s 109(3) (see also s 78(2)(c)). As we have seen, it must be satisfied it is fair to make a costs order having regard to a number of specified matters. With one exception to which I will come, the matters specified are all case-connected - the conduct of the proceeding, unreasonable delay, making untenable claims, the nature and complexity of the proceeding (and the fact the Tribunal has struck the proceeding out).

The exception is a catch-all consideration - any other matter the Tribunal considers relevant. I would not wish to say anything that might restrict the circumstances in which such other matters may arise. This has been left to the Tribunal to determine on a case by case basis.

1. Turning to the issue of whether to award costs on a party/party or indemnity basis, Sheppard J. addressed the issue in Colgate Palmolive Pty Ltd v Cussons Pty Ltd [1993] FCA 536; (1993) 46 FCR 225 . In summary, he said (at p. 232):

1. the ordinary rule is that, where the Court orders the costs of one party to litigation to be paid by another party, the order is for payment of those costs on the party and party basis; 2. in many cases the result will be that the amount recovered by the successful party under the Order will fall short of (in many cases well short of) a complete indemnity;

1. there should be some special or unusual feature in the case to justify the Court in departing from the ordinary practice. Most judges dealing with the problem have resolved the particular case before them by dealing with the circumstances of that case and finding in it the presence or absence of factors which would be capable, if they existed, of warranting a departure from the usual rule;

1. it is useful to note some of the circumstances which have been thought to warrant the exercise of the discretion: 1. the making of allegations of fraud knowing them to be false and the making of irrelevant allegations of fraud; 2. evidence of particular misconduct that causes loss of time to the Court and to other parties; 3. the fact that the proceedings were commenced or continued for some ulterior motive or in wilful disregard of known facts or clearly established law; 4. the making of allegations which ought never to have been

made or the undue prolongation of a case by groundless

contentions; 5. an imprudent refusal of an offer to compromise; and 6. an award of costs on an indemnity basis against a contemptor. 2. other categories of cases are to be found in the reports. Yet others to arise in the future will have different features about them which may justify an order for costs on the indemnity basis. The question must

always be whether the particular facts and circumstances of the

case in question warrant the making of an order for payment of

costs other than on a party and party basis; and 3. it remains to say that the existence of particular facts and

circumstances capable of warranting the making of an order for

payment of costs, for instance, on the indemnity basis, does

not mean that judges are necessarily obliged to exercise their

discretion to make such an order. The costs are always in the

discretion of the trial judge. Provided that discretion is

exercised having regard to the applicable principles and the

particular circumstances of the instant case its exercise will

not be found to have miscarried unless it appears that the

order which has been made involves a manifest error or

injustice. 2. In Ugly Tribe Co Pty Ltd v Sikola [2001] VSC 189, Harper J. discussed similar principles. He also said (para 12),

The position changes where a litigant acts dishonestly in the litigation, or where the rights and privileges of a litigant are flouted or abused. Then, the rationale for refusing to order that the losing party indemnify an opposite party against that party's costs is less compelling. Indeed, costs are more frequently if not invariably awarded on an indemnity or like basis (such as that of solicitor/client) where findings of dishonesty or serious misconduct have been made against the party ordered to pay.

1. Senior Member Walker of VCAT discussed the issue in Paleka v Suvak [2000] VCAT 58, and repeated his view in Mackie and Staff Pty Ltd v Mueller (Domestic Building) [2006] VCAT 1049 (6 June 2006) and Mardel Constructions Pty Ltd v Sinha (Domestic Building) [2009] VCAT 1532 (3 August 2009). While I note his views are put in the context of section 112 of the VCAT Act (which is not relevant here) I refer to his quote in Mardel (at para 16) from Paleka,

I think the conclusion to be drawn from all of the authorities cited and the various quotes to be found in the judgements is that costs, where they are awarded, are normally ordered to be taxed on a party-basis but that they may be awarded on some other basis in an appropriate case. It is in the unfettered discretion of the Tribunal to determine which basis should be adopted. In the exercise of this discretion the Tribunal will take into account the purpose for which provisions such as s112 are enacted but more importantly, it will have regard to the circumstances of the particular case. It is well recognised that party-party costs are usually considerably less than the costs that the successful party has actually spent in prosecuting or defending the application. Even solicitor/client costs, although more generous, fall short of a complete indemnity. Indemnity costs purport to provide a full indemnity but may (according to the terms of the order) not include costs that are unreasonably incurred.

Generally, party/party costs should be awarded. Access to courts and tribunals is a fundamental right enjoyed by everyone in persons bona fide in pursuing that right and not acting improperly should not generally face orders more onerous than party/party costs if they are unsuccessful. Solicitor/client costs are ordered when the party in ....... when the order for costs is being made has somewhat acted improperly in the conduct of the litigation so as to cause the other party unnecessary expenses. Indemnity costs are ordered when the party's conduct is particularly blameworthy. That is, the circumstances, justify a harsh order that ........ solicitor/client costs.

1. He went on to quote Nettle JA in Pacific Indemnity Underwriting Agency Pty Ltd v Maclaw No 651 Pty Ltd & Anor [2005] VSCA 165 (29 June 2005) saying he saw the thrust of the Maclaw decision as consistent with his view. Nettle JA said,

Of course there may be occasions when it is appropriate to award costs in favour of a successful claimant in Domestic Building List proceedings on an indemnity basis. But those occasions will be exceptional and, broadly speaking, circumscribed by the same criteria as govern the award of indemnity costs pursuant to Rule 63.28(c) of the Supreme Court (General Civil Procedure) Rules 1996. ...

1. The "exceptional test" has been adopted a number of times in VCAT's Domestic Building List both to order indemnity costs and to not do so.

1. Counsel for the OC submitted I should award costs on an indemnity basis, referring to sections 75 and 109 of the VCAT Act because Filippou:
   1. failed to comply with the agreements of January 2009 and September 2009 that it would reinstate the glass doors; and
   2. failed to comply with my orders of March 2010 that it reinstate the glass doors.
2. Mr Kalotihos for Filippou submitted each party should pay its own cost. His submitted:

1. in January 2009 when Fillipou agreed to re-instated as soon as the shop fit outs for respective tenants have been completed, it was evident the fitouts would take considerable time, as they did. Before it was reasonable, the OC returned to VCAT to enforce the agreement; 2. Filippou understood that reinstating the glass doors meant putting doors back, not that they had to be self closing as the original doors were;

1. as stated in its letter of 22 April 2010, it attempted to comply with my orders of 1 March 2010;

1. for quite some time the issue had been complicated by Filippou being advised that at least concerning one set of doors, there was no practical way to reinstall self-closing doors. Only in recent times had a way been found to install two sets of self closing doors; and

1. Filippou has paid $10,000 to the OC which is being held on trust to reinstate the doors.

1. I decided to order Filippou to pay the OC's costs in this proceeding from 1 July 2009 (10 days before the OC applied for reinstatement of the proceeding following the January 2009 settlement) as they relate to the issue of the reinstatement of the self-closing doors.
2. I do so because, while the general rule under section 109 is that each party is to bear their own costs in the proceeding, I am satisfied that it is fair to order costs against Filippou. I see Parliament using "fair" in section 109 as meaning, "just or appropriate in the circumstances" (Compact Oxford Dictionary of Current English, 3rd edition revised, June 2008). I had regard to the factors set out in section 109(3). In my view, "(a)(i) failing to comply with an order or direction of the Tribunal without reasonable excuse", "(b) whether a party has been responsible for prolonging unreasonably the time taken to complete the proceeding", "(d) the nature and complexity of the proceeding" and "(e) any other matter the Tribunal considers relevant", are relevant.
3. Further, in terms of section 78 of the VCAT Act, I believe Filippou conducted the proceeding in a way that unnecessarily disadvantaged the OC by its conduct in failing to comply with an orders of the Tribunal without reasonable excuse.
4. I considered the following factors as supporting costs orders:

1. Filippou has been responsible for extraordinary delay in reinstating the glass doors. It has caused the OC to expend great time and substantial legal costs on this issue. In my view, the delay was as follows: 1. in January 2009, Filippou agreed in writing to reinstate the glass doors. The plain meaning of the agreement was to replace what had once been, two sets of automatically sliding glass doors. The agreement did not stipulate a time by which they were to be reinstated. It is plain it was to be a reasonable time. A relevant issue is the doors faced on to the small foyer of the building. For many months, Filippou created a situation where the foyer was greatly impacted by its ongoing works. Visitors to commercial offices in the building would have had a poor first impression; 2. while some of the delay may have been beyond Filippou's control, it created the situation where due to its building works the doors could not easily be reinstalled; 3. whatever view is taken of the time for installation intended in the January agreement, that time was well past by September 2009, when the second agreement, to reinstall at the latest 10 weeks later (by 1 December 2009), was made; 4. the agreements had not been honoured by 1 March 2010 when on that date I ordered they be reinstated by 31 March 2010. Filippou did not comply with the orders; 5. on 7 May 2010, I ordered the doors be reinstated by 18 May 2010. Filippou did not comply with the orders; 6. in June 2010, when I conducted a site inspection, self-closing doors had not been reinstated in front of the bottle shop, although a set of sliding doors were in place (but left open). The works on an internal set of stairs (to a lot controlled by Filippou) was underway. It was not apparent how self-closing doors could be installed (the stairs were later reconfigured). Looking back, in my view the stair installation did not originally envisage self-closing doors; 7. after giving some thought to the issue, I decided the submissions and evidence before me did not equip me to make reasonable monetary or non-monetary orders without further submissions and perhaps evidence. For example the $50,400 quote provided by the OC many months before, did not appear to address the situation in the foyer as existed in June 2010; 8. by late July 2010, Filippou was writing with further proposals saying installation in front of the stairs would be complete within two weeks. It was not; and 9. finally, on 14 December 2010, at the hearing the parties advised the matter appeared to be resolved. 2. not making costs orders would result in all lot owners paying part of the costs of defending this proceeding, that the OC would be liable to pay; and

1. this application concerned a commercial property. The lots are either shops or offices. In my view it is more appropriate that parties will bear their costs in an owners corporation dispute before VCAT (that do not relate to fee recovery) where issues are of a commercial rather than of a domestic nature.

I agree with Deputy President Macnamara's observation in Maltall Pty Ltd & J. & C. Iliopoulous v Bevendale Pty Ltd No. 2, 10 November 1998, (1999) V ConvR 58-528 that the commercial or non-commercial nature of a dispute can be relevant to a costs application. He considered section 109 in the context of the first costs application in VCAT's then new Retail Tenancies List. He said in part (at 58-528),

Sub-paragraph [109(3)] (d) however seems more apposite. This refers as a relevant consideration to the nature and complexity of the proceeding. Mr Dreyfus' submission is that this is in substance ordinary commercial litigation. In my view there is much force in that submission. It is not every matter in the Tribunal's original jurisdiction that attracts that description. Certainly the Civil Claims List as now constituted is solely a list dealing with claims between consumers and traders. In those circumstances whilst the traders might be regarded as involved in commercial litigation in one sense, the consumers certainly are not. Accordingly it would be wrong to enunciate any sort of general principle across the Tribunal's civil jurisdiction. It is however in my view appropriate to consider whether having regard to the nature and complexity of the matters that appear in this list that some general view and policy should be adopted.

I accept Mr Dreyfus' submissions that proceedings in this list are in the nature of inter parties commercial litigation and having regard to the inherent complexity of the law of landlord and tenant, I believe that at least at the Tribunal level the proceedings in this list merit the description in general terms as complex. In my view these considerations lead to the conclusion that in this list the general presumption that parties bear their own costs should not apply and that subject always to the overall and very flexible discretion which attends all costs orders, a successful party should normally expect to receive in this list, a costs order in favour of that successful party absent any specific consideration to the contrary.

However, it is not my view that in the Owners Corporation List there is a general presumption where the owners corporation operates a commercial property that a successful party should normally expect to receive a costs order in favour of that successful party. As Bell J. said in Martin, any decision about costs has been left to the Tribunal to determine on a case by case basis.

1. Turning to the issue of what type of costs should be ordered, I have ordered costs on a party/party basis from 1 July 2009 to and including 6 May 2010, in accordance with Scale D of the Rules of the County Court to be assessed by the Victorian Costs Court in default of agreement. The date 6 May 2010 is the deadline suggested by Filippou in its 22 April letter.
2. I have ordered costs on an indemnity basis from 7 May 2010. In my opinion, on any view, and arguably well before this, Filippou's actions were such as to constitute:

1. a special or unusual feature in the case to justify VCAT departing from the ordinary practice being misconduct that caused loss of time to VCAT and to other parties as discussed by Sheppard J in Colgate; 2. the flouting and abuse of the rights and privileges of a litigant (the OC and through it other lot owners) as discussed by Harper J in Ugly Tribe;

1. an exceptional occasion as discussed by Nettle JA in Pacific Underwriting; and

1. particularly blameworthy conduct as discussed by Walker SM.