1. The relevant principles to be considered under both s74(2)(b) and s109 are well established:
   1. The general rule in s109 is that each party is to bear their own costs unless the Tribunal considers it fair to order otherwise (s109(1)).
   2. Section 74(2)(b) confers a power to award costs upon withdrawal that is separate from the Tribunal's general costs power under s109.[2]
   3. The discretionary power to award costs under s74(2)(b) is governed by the overarching obligation on the Tribunal to act fairly and according to the substantial merits of the case, imposed by s97.[3]
   4. There is no automatic rule that costs will always be awarded against the withdrawing party. The decision as to costs must be based on the particular circumstances of each case.[4]
   5. The circumstances set out in s109(3) may be relevant to the exercise of discretion to award costs under s74(2)(b).[5]
   6. The term "costs" has the same meaning in s74(2) of the VCAT Act as it has in s109 of the VCAT Act.[6] The Tribunal has long accepted that, following the High Court of Australia decision in Cachia v Hanes,[7] and in the context of an application for an award of costs, costs means legal costs - that is, costs of a lawyer.[8] This may include the costs of a professional advocate, as that term is defined in s62 of the VCAT Act, where a party is represented by a professional advocate in the circumstances contemplated by with s62(1)(b) or (c) of the VCAT Act.[9]

1. The applicant commenced the application for unpaid fees on 22 February 2023.
2. The Tribunal's first Order, dated 14 March 2023, listed the proceeding for hearing and determination on the papers on 26 April 2023. The Tribunal's Order, and a Notice of Hearing On the Papers, was sent by post to the respondent at the lot.
3. In accordance with the Tribunal's usual procedure in fee recovery applications, the Order directed the applicant to file a Summary of Proofs and copies of all documents by 28 March 2023, and directed the respondent to file Points of Defence, supporting documents and submissions, by 11 April 2023. Any objection to the application being heard and determined "on the papers" was required to be made by 18 April 2023.
4. The applicant filed its Summary of Proofs and supporting documents on 27 March 2023.
5. The respondent did not file Points of Defence, documents or submissions by 11 April 2023.
6. Due to oversight, orders were not made on 26 April 2023. This oversight became apparent only after the respondent emailed requesting that the hearing not be listed on certain dates in May 2023. That correspondence was treated as an objection to the application being heard and determined "on the papers", and a hearing by videoconferencing facility was scheduled for 30 October 2023.
7. On 23 October 2023, the respondent filed an affidavit, for the hearing.
8. Subsequently, the hearing was further adjourned to 29 February 2024, on the respondent's request that the hearing be held in the afternoon, because she was overseas, and in a different time zone.[10]
9. The application was then withdrawn by Orders of the Tribunal dated 15 March 2024, on the application of the applicant.
10. As a consequence, there was no hearing in person in the proceeding.

1. The evidence given by the respondent in her affidavit dated 23 October 2023 is relevant to the application she now makes for costs. It will be convenient to consider that affidavit before turning to the costs application.
2. The respondent's affidavit dated 23 October 2023 comprises six paragraphs over 3 pages, and 8 pages of Exhibits.
3. In paragraph 2 of the affidavit the respondent deposed that she had owned the lot in the subdivision since 1990, and

the structure payment of levies was paid every quarter in advance, if there was a special levy each year, eg: sinking fund, I have paid the full amount. ...[after a change in owners corporation management] I continued to pay [the manager] on a quarterly basis in advance, as that is a standard practice in the industry as I have been told by my family and friends.

1. In paragraph 3 of the affidavit, the respondent deposed further as to payments made on 8 May 2022, 8 August 2022, 7 November 2022, 14 November 2022, 22 November 2022, 28 February 2023, 8 May 2023, and 8 August 2023. She deposes that "the payments for November 2023 and February 2024 are not due yet and will be paid before the due date". The Exhibits relating to these payments are of extremely poor quality and cannot be read.
2. In paragraph 3 of the affidavit the respondent also deposed that

Being an aged pensioner, we do not get paid by the government for the full year, hence I am unable to pay my levies in full at the start of the year. Despite making payments, [the manager] made an application to VCAT for fee recovery. As I have been financial, there was no need of [sic] VCAT application, this is a mere demonstration of the strata manager's incompetency.

1. In paragraph 4 of the affidavit, the respondent deposed to, and made submissions in relation to, a final fee notice dated 3 August 2023. That final fee notice was not the subject of this proceeding: as I have noted above, the owners corporation relied on a fee notice dated 3 October 2022 and a final fee notice dated 16 December 2022.
2. In the last two paragraphs of the affidavit the respondent deposes

I was not aware of the hearing date of 26 April 2023. On becoming aware of it with great difficulty I borrowed money $..... (sic) and flew down to Melbourne to resolve the VCAT issue. I personally went to VCAT for requesting (sic) a date before my travel back to overseas, unfortunately I had no response.

I urge the member hearing this case to please make an order to reimburse my money $..... which I had to borrow to travel to Melbourne. As stated and clearly proven in the financials that I have been financial all the way through.

1. The respondent's application for costs was filed on 28 March 2024 by Thomas D'Souza, Fire Risk Engineer, who stated, in the covering email that he acted "as a paralegal" for the respondent".[11]
2. By orders dated 2 April 2024, the Tribunal set a timetable by which the parties were to file and serve documents in relation to the respondent's application for costs. The Order directed that the costs application would be heard and determined "on the papers" pursuant to s100 of the Victorian Civil and Administrative Tribunal Act 1998, that is, without appearance or representation by the parties. Any party objecting to the proceeding being heard and determined "on the papers" was required to make their objection known by 31 May 2024. No such objection was made by either party.
3. The respondent's affidavit and submissions were required to be filed by 24 April 2024. On 22 April 2024, the respondent filed an affidavit, dated 19 April 2024, taken by a Notary of the Government of India, in support of her costs application. That document was taken to have been filed and served in partial compliance with the Tribunal's orders dated 2 April 2024. The following day, Mr D'Souza sent an email requesting amendment of the Tribunal's Order dated 2 April 2024, to extend the compliance dates, to give the respondent more time to 'gather information for our submissions' in support of the application for costs.
4. Mr D'Souza's email dated 23 April 2024 was inadvertently overlooked by the Tribunal's registry. That oversight was eventually rectified and brought to my attention by the Tribunal's registry on 18 October 2024. I made a further Order that day extending the dates for compliance. The terms of the Order drew the parties' attention to the need to address the legal grounds on which the respondent relied, and the legal authorities relevant to s74(2)(b) of the VCAT Act.
5. Due to further administrative oversight within the Tribunal's registry, the Order dated 18 October 2024 was not sent to the parties, but, regrettably, this fact did not become apparent until after further Orders had been sent to the parties dismissing the respondent's application for costs for noncompliance with compliance dates set out in the Tribunal's Order dated 18 October 2024.
6. When the administrative error was brought to the Tribunal's attention by the respondent, the proceeding was reinstated and further extensions of time ordered.
7. The respondent filed submissions in support of her application for costs on 14 February 2025, as directed. The applicant filed its submissions in reply to those of the respondent on 25 February 2025, as directed. The respondent's submissions in reply to those of the applicant were required by 11 March 2025. On 31 March 2025, the respondent wrote to the Tribunal, omitting to copy the applicant, requesting a further extension of time to 2 April 2025. The respondent did not meet that timeline, and requested a further extension of time, which was granted, extending the time to 4:00pm AEST on 7 April 2025.
8. The respondent subsequently filed submissions in reply on 8 April 2025.

1. As I have noted above, the respondent relies on an affidavit dated 19 April 2024 in support of her claim for costs.
2. I set out the text of the affidavit dated 19 April 2024 in full here:

I Gover Navill Cadamster of [address omitted] make oath and say in support of my Costs Application:

I engaged a competing body corporate manager to take instructions and produce an Affidavit dated 23 October 2023 and I paid $143 in Notary Fees to be able to swear the affidavit in a foreign Country. The notary fees were cheaper than me travelling back to Victoria for the sole purpose of executing an Affidavit.

My taxi fares are AUD72 for me to commute to and from the office of the notary. These were paid to the taxi drivers on completion of each trip. The meter does not print out a receipt like it does in Australia.

I booked a flight to Australia for the first hearing. The Flight was AUD1399. Now shown to me and annexed as Annexure1 of this Affidavit is the my [sic] tax invoice for the flight.

My Paralegal charged me $1000 to prepare for the trial and file this Application. I am yet to receive an invoice for the additional work done over and above the trial preparation, for the Applicant not co-operating with my requests to know which of my accounts the Applicant took money from without my consent.

[jurat omitted]

1. Exhibited to the affidavit is an email receipt, apparently issued by Richard Alwyn to Nan Ram by Mann Travel on 10 April 2023 for $1399.00. The email receipt does not prove payment by the respondent of this amount.
2. As I have noted above, the respondent was not required to attend a hearing in April 2023. No documentary evidence was exhibited to the affidavit in respect of the affidavit dated 23 October 2023, notary fees, taxi fares or the amount of $1,000 charged by the paralegal "to prepare for the trial" and file the costs application.

The respondent's submissions dated 14 February 2025

1. Submissions dated 14 February 2025 were filed on behalf of the respondent by Thomas D'Souza. On page 8 of the submissions, Mr D'Souza set out the following "summary of expenses":

Take instructions and produce affidavit in reply dated 25 October 2023

Paralegal prepare for trial and file this Application for costs

Submissions ordered on question of costs 14 February 2025

1. Attached to the Submission are copies of two invoices, each issued by Rubik Fire Pty Ltd, dated 14 October 2024 and 14 February 2025.
2. The invoice dated 14 October 2024 is for $2,500.00, and is in respect of the first and fifth item in the table above.
3. The invoice dated 14 February 2025 is for $800.00 and is in respect of the sixth item in the table above.
4. Both invoices are marked with the notation "This claim is made under the Building & Construction Industry Security of Payment Act 1999".[12] It is clear they have no connection at all with a contract for construction work.
5. The submissions made, over 59 paragraphs are of no assistance to the Tribunal. The submissions commence with the proposition that by withdrawing the application the applicant "denied the respondent the opportunity to have its day in court, after the extensive preparation that had taken place, only to be turned to costs thrown away".[13] The respondent accepts that the Registrar was not required to consult the respondent on the withdrawal.[14]
6. The submissions allege, without any evidence to support the allegation, that the applicant drew on the respondent's trust funds to pay the amount that had been claimed in this proceeding.[15]
7. In support of the claim for $1,500.00, the respondent submits

We submit that our paralegal background and involvement in VCAT (and other tribunals around the country) in particular on the Planning and Environment list (list names vary per jurisdiction); that we have been able to apply our knowledge of VCAT practice and procedure to assist the tribunal to identify the issues in dispute, and uncover anomalies within the respondent's trust funds unilaterally controlled by the applicant's owners corporation manager. We are keen to see the applicant's reply to double dipping allegations"

1. As there was no determination of the applicant's claim, it is misconceived to suggest that the respondent had any impact on the outcome of the proceeding, or provided any "assistance" to the Tribunal.

The applicant's submissions in reply dated 25 February 2025

1. In summary, the applicant's submission, in response to the respondent's application for costs, is that the respondent fell into arrears because, although fees are levied annually, and a single annual payment required, the respondent "chooses to pay quarterly".
2. The applicant noted that the owners corporation had incurred application fees, and additional hours of preparation for the hearings. Those amounts cannot now be claimed, because the substantive claim has been withdrawn. The owners corporation's costs will be borne by all lot owners, including the respondent, according to lot liability.

1. The respondent's submissions in reply
   1. assert that Mr DeSouza has "kept a file running and done work for as [sic] a Paralegal, such as having prepared this matter inside-out [sic] for trial, only for the Applicant to withdraw 9 days before trial".
   2. allege, without evidence, that the applicant's manager "removed money" from an account of the respondent.
   3. allege, without evidence, that funds paid to the owners corporation are applied to different purposes.
   4. assert that the quarterly payments made [by the respondent] "add to the amount approved at the AGM", by which I understand the respondent to be saying that over four quarters she made payments which add up to the sum of the annual fees payable.
   5. submit that the principle set out in s109 of the VCAT Act, that each party should bear its own costs should have no application to an application for costs pursuant to s74(2) of the VCAT Act.
   6. appear to suggest that the applicant was responsible for the proceeding being listed for hearing "on the papers" and submits that a hearing on the papers "was not suitable" for the respondent, who is "a 76 year old pensioner who has arthritis and little to no records in her possession to defend this matter on the papers".

1. In the circumstances of this proceeding, and having due regard to the requirements of the VCAT Act, I am satisfied that it would not be fair to order the owners corporation to pay the costs claimed by the respondent.
2. As I have noted above, the Tribunal's power to order costs under s74(2)(b) of the VCAT Act is discretionary, and governed by the Tribunal's overarching obligation to act fairly and according to the substantial merits of the case, as required by s97 of the VCAT Act. It is also appropriate that I have regard to the matters set out in s109(3) of the VCAT Act. I consider the following matters relevant to my determination.

Did the applicant conduct the proceeding in a way that unnecessarily disadvantaged the respondent? (s109(3)(a) VCAT Act)

1. The respondent asserts that there was no need for the fee recovery application to be made, and that she was "financial" at all times. It is apparent that the owners corporation is of the view that fees were payable annually and not quarterly. That issue has not been determined in a hearing. However, I note that, the respondent herself has deposed that she is "unable to pay my levies in full at the start of the year". That appears to be an acknowledgement that the owners corporation expected fees to be paid annually in advance, and not quarterly as the respondent has done.
2. It was not inappropriate for the owners corporation to commence the proceeding. The owners corporation did not conduct the proceeding in a way that unnecessarily disadvantaged the respondent.

Was the applicant responsible for prolonging unnecessarily the time taken to complete the proceeding?

1. As I have set out above, the Tribunal's file discloses that a number of lengthy and unfortunate delays were occasioned by oversight on the part of the Tribunal's registry staff. Those delays were regrettable, and the Tribunal extends its apologies to the parties for that having been the case. However, the applicant was not responsible in any way for those delays. Further, the short delay between 30 October 2023 and 29 February 2024 was occasioned by the respondent herself, as a consequence of her request that the hearing be scheduled later in the day.

Would it otherwise be fair or according to the substantial merits?

1. The evidence filed by the respondent in support of her application for costs consists solely of the affidavit dated 19 April 2024. In that affidavit, she deposes that she was charged $1,000 to "prepare for the trial and to prepare [the costs application]".
2. Although the submissions prepared by the paralegal, dated 14 February 2025, seek to assert claims that include $1,500 for "take instructions and produce affidavit in reply dated 23 October 2023" and $1,000 for "paralegal prepare for trial and file this application for costs", the respondent's affidavit evidence dated 19 April 2024, does not include any evidence in relation to costs associated with the later affidavit or other services.
3. As I have set out above, the affidavit dated 23 October 2023 included an acknowledgement that the owners corporation required fees to be paid annually, and that the respondent had made payments quarterly. That is, the respondent did not challenge the fees themselves, nor did she assert that the fee notices relied upon by the owners corporation were invalid or unable to be relied upon. It is apparent that, if fees required to be paid annually were paid in quarterly instalments, the respondent would be in arrears for much of the financial year.
4. The affidavit sworn by the respondent dated 23 October 2023 did not address the legislative requirements applicable to the applicant's claim. No other material was filed by the respondent prior to the withdrawal. On its face, the material filed by the respondent recorded that she had no defence to the claim made against her.
5. The amounts claimed by the respondent for air fares were not required to be incurred by her. She had been served with the Tribunal's Order dated 14 March 2023 and Notice of Hearing On the Papers, and had notice from the date of service of those documents that the hearing was not to be in person, and that she was required to file Points of Defence if she sought to defend the claim. That claim, and the claim made for taxi fares, are not claims for legal costs as that term is to be understood in ss74 and 109 of the VCAT Act.
6. Accordingly, I find there is no basis to depart from the general principle under s109(1) of the VCAT Act that each party should bear their own costs of the proceeding. I find there are no grounds which would make it otherwise fair or according to the substantial merits of the case to order the applicant to pay the costs claimed by the respondent. The respondent's application for costs is dismissed.

[1] Pursuant to s100 of the Victorian Civil and Administrative Tribunal Act 1998.

[2] Asghari v SBS Radio [2001] VCAT 1755; Luchio Nominees Pty Ltd v Epping Fresh Food Market Pty Ltd [2016] VCAT 969.

[3] [2016] VCAT 969 at [97].

[4] Body Corporate Strata Plan No 405967 No 1 v Brady Constructions Pty Ltd [2008] VCAT 2305 at [83].

[5] Fernandez v Amatek Pty Ltd [2001] VCAT 1979 at [9].

[6] Barbary v CBL Insurance [2016] VCAT 1218 ('Barbary') at [14], following Fasham Johnson Pty Ltd v Ware [2004] VCAT 1708.

[7] [1994] HCA 14; (1994) 179 CLR 403.

[8] See also Gelman v Kenny [2013] VCAT 117.

[9] See, for example, Re Cardinia Shire Council v Stoilkovic (2002) 12 VPR 61, referred to in Barbary.

[10] Tribunal's Order dated 15 November 2023.

[11] It appears, from material filed by Mr D'Souza in 2025, that he holds a qualification in law, and may thereby be considered to be a 'professional advocate' within the meaning of subsection 62(8)(c) of the VCAT Act. As the owners corporation was represented by a professional advocate, its owners corporation manager, a person with substantial experience before the Tribunal, section 62(1) of the VCAT Act permitted the respondent also to be represented by a professional advocate, in accordance with s62(1)(b)(iii) of the VCAT Act.

[12] This appears to be a reference to the New South Wales legislation of that name, the Building and Constructions Industry Security of Payment Act 1999 (NSW). The Victorian equivalent legislation is the Building and Construction Industry Security of Payment Act 2002 (Vic).

[13] Respondent's submissions dated 13 February 2025 paragraph 2.