DATE BY WHICH APPLICANT FILED SUBMISSIONS IN RESPONSE

DATE BY WHICH ANY OBJECTION TO A DETERMINATION ON THE PAPERS WAS TO BE MADE

Owners Corporation PS631843C v Saint-John (Owners Corporations) (Costs) [2025] VCAT 368

1. The respondent's application for costs is dismissed.

1. This is an application by the respondent Simon Saint-John ('Saint-John') for the applicant Owners Corporation PS631843C ('the OC') to pay all, or alternatively part, of his costs of the proceeding.
2. This proceeding has a relatively short history, with the OC filing an application and affidavit in support on 1 October 2024 seeking injunctive relief to restrain Saint-John from conducting a special general meeting of the OC proposed to be held on 3 October 2024.
3. The OC sought the listing of an urgent injunction on 2 October 2024, however due to staffing constraints the Tribunal was not able to list the proceeding for an injunction hearing, instead listing the proceeding for a directions hearing on 23 October 2024.
4. The directions hearing proceeded before me on 23 October 2024 at which time the issue of the OC's ability to initiate the proceedings was raised, with Saint-John seeking a stay of proceedings due to non-compliance with s 18 of the Owners Corporations Act 2006 (Vic) ('OC Act'). I made orders on that day requiring the OC to file submissions by 13 November 2024 with respect to that issue.
5. The OC did not file submissions in accordance with the orders, instead seeking leave to withdraw the application on 19 November 2024.
6. Saint-John neither consented to nor opposed the withdrawal of the application, but noted that in the event the OC was granted leave to withdraw its application he would apply for an order that the OC pay his costs of the proceeding.
7. Leave with granted to the OC to withdraw its application by order dated 28 November 2025, and on 11 December 2024 Saint-John sought an order for the payment of his costs by the OC.
8. I made timetabling orders for the parties to file written submissions, and neither party objected to the determination of the costs application on the papers.
9. Saint-John seeks his costs pursuant to s 74(2)(b) and s 109(3) of the Victorian Civil and Administrative Tribunal Act 1998 ('VCAT Act').

1. Section 74 of the VCAT Act relevantly states:

Withdrawal of proceedings

(1) If the Tribunal gives leave, an applicant may withdraw an application or referral before it is determined by the Tribunal.

(2) If an applicant withdraws an application or referral -

...

(b) the Tribunal may make an order that the applicant pay all, or any part of, the costs of the other parties to the proceeding; ...

1. Section 74(2)(b) relevantly gives the Tribunal the power to exercise discretion to award costs where it has given an applicant leave to withdraw an application. The section itself does not provide any express limitations or guidance as to how that discretion may be exercised. However, the authorities state that the discretion must be exercised in compliance with s 97 of the VCAT Act. That is, the Tribunal must exercise its discretionary power 'fairly and according to the substantial merits of the case in all proceedings'.
2. In addition to s 74(2)(b), where the Tribunal has ordered that the application or proceeding has been withdrawn, a respondent may be able to seek costs under s 109(2) of the VCAT Act, provided that the requirements under s 109(3) are met.
3. Section 109 states:

Power to award costs

(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);

(iv) causing an adjournment;

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

(vi) vexatiously conducting the proceeding;

(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;

(d) the nature and complexity of the proceeding;

(e) any other matter the Tribunal considers relevant.

1. When considering a costs application under s 74(2)(b) and s 109(3) of the VCAT Act, Senior Member Kirton (as her Honour then was) in Yanik[1] stated:

As I said in Culvenor v Casey, it is well established that the following principles should be considered in an application under both s 74(2)(b) and s 109:

1. 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. When awarding costs under s 74(2)(b) there is no rule (as there is under s 109) that costs lie where they fall unless the Tribunal considers it fair to order otherwise.
3. The discretionary power to award costs under s 74(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 s 97.
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.
5. The circumstances set out in s 109(3) may be relevant to the exercise of discretion to award costs under s 74(2)(b).
6. The general rule in s 109 is that each party is to bear their own costs unless the Tribunal considers it fair to order otherwise (s 109(1)).
7. The Tribunal has a broad discretion to award costs after taking into account the factors in s 109(3).

1. Saint-John submits that there are several relevant factors which should be persuasive to the Tribunal in considering the application for costs. I will consider each of them in turn, and then overall, in determining whether it is fair in the circumstances to make an order for costs.
2. Saint-John submits that the OC has acted unreasonably in the conduct of the proceeding including:

(a) By filing an application for an injunction less than two days before the scheduled special general meeting, and with less than 20 minutes notice to Saint-John's solicitor;

(b) Commencing the proceeding without a special resolution authorising it to do so; and

(c) By continuing the proceeding until 19 November 2024 despite:

(i) Saint-John's solicitor's email on 1 October 2024 inviting the OC to withdraw its application; and

(ii) The first return date of the OC's application being listed for a directions hearing on 23 October 2024, and the special general meeting having proceeded on 3 October 2024, noting that the applicant did not seek to amend its application after the meeting was held on 3 October 2024 to seek declaratory relief in lieu of injunctive relief.

1. I am not persuaded by Saint-John's submissions or the timeline of the proceeding that the OC acted unreasonably in the conduct of the proceeding. It is fairly typical in the issuing of proceedings of an urgent injunctive nature that that filing of the application will be undertaken on an urgent basis and with little or no notice to the opposing party. In this case the OC was attempting to prevent a special general meeting proceeding on 3 October 2024, and filed its application on 1 October 2024, on short notice to Saint-John. This is neither unusual nor unreasonable in respect of an application for urgent injunctive relief.
2. The commencement of the proceeding without a special resolution authorising it to do so may be considered unreasonable, as it involves commences a proceeding without compliance with s18 of the OC Act. However, the application was commenced by way of urgent interlocutory relief, and had the proceeding continued, the issue of non-compliance with the OC Act could have been remedied by the passing of a subsequent special resolution authorising the continuation of the proceedings. The commencement of the proceedings without a special resolution does not in the particular circumstances of this proceeding satisfy me that it is fair to award costs.
3. Saint-John also submits the OC acted unreasonably by continuing the proceeding until 19 November 2024 despite inviting the OC to withdraw its application by email of 1 October 2024, and failing to seek leave to amend its application following the special general meeting on 3 October 2025. It was not unreasonable for the OC not to withdraw its application on 1 October 2024 in response to Saint-John's email, as the OC was seeking an urgent hearing on 2 October 2024, to prevent the special general meeting occurring on 3 October 2024. Due to Tribunal constraints the matter could not be listed for injunctive relief, and the only hearing in this proceeding was the directions hearing before me on 23 October 2024. These were circumstances outside of the control of the OC. Following the directions hearing the OC did not file submissions in respect of s 18 of the OC Act but sought to withdraw its application on 19 November 2024. These steps were taken whilst proceeding OC1200/2024 was also on foot, and in which Senior Member Moraitis made injunctive orders on 29 October 2024. Those orders included Order 4 that 'The persons purportedly appointed to the committee on 3 October 2024 are restrained from acting as committee members until the next Annual General Meeting'. With the making of those orders, the OC had in effect achieved what it had originally sought in this proceeding. It was therefore reasonable and appropriate that it did not seek leave to amend its application, or file the ordered submissions, but instead sought leave to withdraw the application.
4. Saint-John further submits that the proceeding was 'misconceived and the majority of the applicant's claims in its points of claim had no tenable basis in fact or in law'.[2] Saint-John's submission provide little elaboration on this point, and I am not satisfied that this is the case. The proceeding did not reach a point at which Points of Defence were required to be filed to address any alleged deficiency in law or fact in the application. Indeed, contrary to this submission, Senior Member Moraitis made orders on 29 October 2024 which included an order that 'The persons purportedly appointed to the committee on 3 October 2024 are restrained from acting as committee members until the next Annual General Meeting'. These orders were made despite the fact that the OC was a respondent to the proceeding, and not withstanding this, the Senior Member determined that orders should be made preventing those persons purportedly elected on 3 October 2024 to act as committee members. There is nothing before the Tribunal to suggest that the claim had no tenable basis in fact or in law.
5. Finally, Saint-John submits that the nature and complexity of the proceeding warrants an award of costs. He states that the application was in the nature of an application for final relief and was commenced and maintained in the midst of a complicated series ongoing disputes between the parties, including corporate governance disputes.[3]
6. Whilst I accept the disputes that have arisen between the parties in multiple proceedings have complexity, this proceeding was confined in terms of the issues raised and of short duration. That application commenced as one for injunctive relief, but did not proceed on that basis due to Tribunal constraints. One directions hearing was held, and leave was granted to withdraw the proceeding subsequent to that directions hearing. The nature and complexity of the proceeding does not in my view warrant an award of costs.
7. The general rule in s 109 of the VCAT Act is that each party is to bear their own costs unless the Tribunal considers it fair to order otherwise (s 109(1)). I am not satisfied that it is fair to depart from the position that each party bears their own costs under s 109.
8. When awarding costs under s 74(2)(b) of the VCAT Act following the withdrawal of a proceeding, there is no rule (as there is under s 109) that costs lie where they fall unless the Tribunal considers it fair to order otherwise. Equally though, 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. The circumstances set out in s 109(3) may be relevant to the exercise of discretion to award costs under s 74(2)(b).
9. I am satisfied for the reasons I have provided above that the circumstances of this proceeding do not warrant the exercise of my discretion to award costs under s 74(2)(b).
10. The application for costs shall be dismissed.

[1] Yanik v Thomas (Building and Property) [2023] VCAT 850 at [11].

[2] Saint-John's submissions dated 29 January 2025 at para 4.