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[2008] WASCA 109
Court of Appeal (WA)
2008-05-14
McLure JA, Steytler P, Lure JA, Pullin JA
Original judgment source is linked above.
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
CITATION : REAL ESTATE AND BUSINESS AGENTS SUPERVISORY BOARD -v- ESPANOL HOLDINGS PTY LTD (in liq) [No 2] [2008] WASCA 109
BETWEEN : REAL ESTATE AND BUSINESS AGENTS SUPERVISORY BOARD
ESPANOL HOLDINGS PTY LTD (in liq) (ACN 009 087 334)
Jurisdiction : STATE ADMINISTRATIVE TRIBUNAL OF WESTERN AUSTRALIA
Coram : HON R VIOL (SUPPLEMENTARY DEPUTY PRESIDENT)
Citation : ESPANOL HOLDINGS PTY LTD & ANOR and REAL ESTATE & BUSINESS AGENTS SUPERVISORY BOARD [2007] WASAT 5
Statutes - Interpretation - Real Estate and Business Agents Act 1978 (WA) - Claim under Fidelity Account - Scope of s 117, s 118 and s 119 - Relevance of release to power to settle claim - Whether action in rem - Whether jurisdiction conferred on courts
Bankruptcy Act 1966 (Cth), s 58(3)
Legal Profession Practice Act 1958 (Vic), s 66(3)
2 McLURE JA: The Real Estate and Business Agents Supervisory Board (Board) appeals from the decision of the State Administrative Tribunal (Tribunal) made on 12 January 2007 setting aside the Board's decision made on 25 July 2006 disallowing the respondents' claim against the Real Estate and Business Agents Fidelity Guarantee Fund (Fidelity Fund). The Fidelity Fund, now called Fidelity Account, is established under the Real Estate and Business Agents Act 1978 (WA) (the Act), s 107. I will refer to the fund as the Fidelity Account. The Board is established under the Act and administers the Fidelity Account.
3 In February 1999 the respondents commenced Supreme Court proceedings against, inter alia, Douglas Brewer, a licensed real estate agent, and Martin Banning, a licensed business agent/sales representative, in relation to two real estate transactions in which they acted for the respondents (Supreme Court action).
4 On 13 March 1999 the respondents gave notice of their claim against the Fidelity Account arising out of the conduct of Brewer and Banning in relation to the real estate transactions the subject of the Supreme Court action (the transactions).
5 Between 6 February 2003 and 26 June 2003 the Board conducted proceedings under Pt II Div 3 of the Act in relation to allegations of professional misconduct against Brewer and Banning arising out of the transactions. On 31 December 2004 the Board delivered written reasons for its decision which had been delivered on 29 August 2003. The Board found that Brewer and Banning were involved in the 're-documentation' of the transactions pursuant to which the prices of the properties were increased so as to enhance the prospect of finance being obtained for those transactions. The Board also found that the second respondent (a director of the first respondent) was a willing and knowing party to the re-documentation of the transactions.
6 By deed dated 29 April 2005 the parties to the Supreme Court action settled the action before trial (settlement deed). Each defendant agreed to pay a nominated sum to the respondents which totalled $550,000, of which $525,000 was paid to their solicitors for legal costs. By cl 3 of the settlement deed, the respondents released and discharged the defendants, including Brewer and Banning, from all claims, actions etc arising out of
the subject matter of, or facts relied on in, the Supreme Court action. Clause 8 of the settlement deed provides:
Each party acknowledges that the other parties are entitled to enforce this deed directly and may plead this deed in bar to any claim or proceeding by any of the parties against any other party in respect of the Released Matters.
7 In August 2005, at a preliminary hearing of the respondents' claim against the Fidelity Account, the Board ordered that two questions be determined as preliminary issues. For present purposes, the relevant issue was whether the claim should be dismissed on the basis that the Board was entitled to rely on the releases granted by the respondents to Banning and Brewer in the settlement deed.
8 After hearing from the parties, the Board disallowed the claim concluding that the releases granted to Brewer and Banning prevented any claim by the respondents against the Fidelity Account.
9 The respondents applied to the Tribunal under s 23(1) of the Act to review the Board's decision. The Tribunal concluded that the settlement deed could not be relied on to defeat the respondents' claim against the Fidelity Account. Before explaining the reasons for the Tribunal's decision it is necessary to set out the statutory scheme.
10 Part VIII of the Act deals with the Fidelity Account. The Fidelity Account is funded from, inter alia, compulsory contributions from agents and sales representatives licensed and registered under the Act (s 109, s 113). If the Fidelity Account is, in the opinion of the Board, 'not sufficient to satisfy the liabilities of the Board', the Board can impose a levy on licensed agents and registered sales representatives (s 115(1)). Section 116 identifies the purpose of the Fidelity Account. It provides:
(1) Subject to this Act, the Fidelity Account shall be held and applied for the purpose of reimbursing persons who may suffer pecuniary loss or loss of property by reason of any defalcation by a licensee during any period when he was the holder of a current triennial certificate, but reimbursing only to the extent of the defalcation of the licensee.
(2) The Board is to disallow a claim against the Fidelity Account unless -
(a) notice of the claim is given in writing to the Board within 3 years after the day on which the claimant became aware of the defalcation; or
(b) the Board -
(i) has been given notice in writing of the claim within 6 years after the day on which the claimant became aware of the defalcation; and
(ii) considers that it is just and reasonable in the circumstances to deal with the claim even though notice was not given within the time referred to in paragraph (a).
(1) The Board may receive and, subject to section 116(2), settle any claim against the Fidelity Account at any time after the defalcation in respect of which the claim arose has occurred, but no person is entitled, without the leave of the Board, to commence any action in relation to the Fidelity Account, unless the Board has disallowed his claim and unless and until the claimant has exhausted all relevant rights of action and other legal remedies available against the defaulting licensee or any other person in respect of the loss suffered by the claimant.
(2) A person is not entitled to recover from the Fidelity Account an amount greater than the balance of the loss suffered by him after deducting from the total amount of his loss, the amount or value of all money or other benefits received or receivable by him from any source other than the Fidelity Account in reduction of his loss, including any benefits received by reason of services rendered or payments made by the defaulting licensee.
(3) No amount shall be charged or be chargeable to the Fidelity Account as interest on the amount of any judgment obtained or of any claim admitted against the Fidelity Account.
(4) No right of action lies in relation to the Fidelity Account in respect of any loss suffered by any person by reason of any defalcation by a licensee at any time after the claimant has received a notice in writing from the Board warning him against the employment or continued employment of that licensee which notice the Board is hereby empowered to send.
(5) No right of action lies in relation to the Fidelity Account in respect of any loss suffered by the spouse or de facto partner of a licensee by reason of any defalcation by that licensee, or in respect of any loss suffered by any licensee by reason of any defalcation in the course of the licensee's business by any one or more of the persons in the class of persons specified in the interpretation "defalcation by a licensee" in section 4.
In any action brought against the Board in relation to the Fidelity Account, all defences that would have been available to the defaulting licensee are available to the Board.
On payment from moneys standing to the credit of the Fidelity Account in settlement in whole or in part of any claims under this Act, the Board shall be subrogated, to the extent of that payment, to all rights and remedies of the claimant against the licensee in relation to whom the claim arose or in the event of the death or insolvency or other disability of the licensee, against his personal representatives or other persons having authority to administer his estate, and to all other rights and remedies of the claimant in respect of the defalcation to which the claim relates.
12 Section 120 of the Act sets out what is to be done in the event the Fidelity Account is insufficient to satisfy all judgments and claims. Section 120(1) materially provides that the moneys standing to the credit of the Fidelity Account are the only property of the Board available for the satisfaction of any judgment obtained against the Board in relation to the Fidelity Account, or for the payment of any claim allowed by the Board; in the event the moneys are insufficient, unsatisfied judgments and claims shall be charged against future accumulations of the Fidelity Account.
13 The Tribunal's reasoning was as follows. Sections 117 and 118 of the Act contemplate two distinct procedures being a 'claim' against the Fidelity Account and 'action' against the Board in relation to that account. The decision of the Board related to a claim against the Fidelity Account and was not an action against the Board. The Tribunal concluded:
Because of this clear dichotomy, the Tribunal is of the view that on the face of the legislation, the [Board], when acting administratively, cannot rely on the provisions of s 118 [53].
14 The Tribunal also relied on public interest considerations for its conclusion. It said [61] - [63]:
The Tribunal also confirms that the Deed was a commercial settlement and could not be relied upon to determine the likely outcome of the Supreme Court action. As noted by [the respondents], the Board has previously taken into account payments received under a settlement, to the extent that they relate to the Fidelity Fund claim under consideration as reducing the amount of the award payable to the claimant in reduction of the losses as required by s 117(2) of the Act (e_x parte Bowie_ (Unreported REBA decision, 17 January 2003 at 52) ... ). The Board's decision in this matter is thus contrary to its decision in the previous matter.
This finding by the Tribunal is another reason why, in the Tribunal's view, the Deed could not be relied on to defeat the claim by [the respondents].
The Tribunal is also of the view that as a matter of public interest, parties should be encouraged to settle claims which would have the potential to limit the liability of the Board in the event that a claim against the Fidelity Fund was made.
15 The Tribunal rejected the respondents' contentions that no court had jurisdiction to hear an action in relation to the Fidelity Account and that s 119 entitles the Board to sue a defaulting licensee who had been released by a claimant.
16 The Board relied on two grounds of appeal in the following terms (excluding particulars):
17 At the hearing the Board applied for leave to add a further ground of appeal in the following terms:
18 The application for leave was opposed. The proposed ground was in response to the respondents' interpretation of the Tribunal's reasons. The amendment occasions no prejudice to the respondents and leave should be granted.
19 Rule 33(7)(a) of the Supreme Court (Court of Appeal) Rules 2005 (WA) requires a respondent to state succinctly in numbered paragraphs each ground not relied on by the primary court on which the respondent relies to uphold the primary court's decision. The respondents' notice of contention does not comply with that rule. In this case, the court is left to attempt to identify the respondents' grounds from 10 pages of submissions which it is said should be read together with their submissions in opposition to the appeal. I take the grounds of contention to be that:
20 There is also a ground of contention which is to be found only in the respondents' appeal submissions. It is in terms that s 118 of the Act should be interpreted as 'only conferring those defences available at the time of the defalcation rather than any defence alleged to arise after the time of the defalcation'. It was reformulated in the course of oral submissions to refer to defences available with respect to the conduct complained of (being the defalcation in issue).
21 It is inappropriate to consider the parties' contentions in isolation and without regard to the legislative scheme relating to claims against the Fidelity Account. The starting point is to identify the nature and scope of the claimant's rights and the Board's powers or duties under Pt VIII of the Act. That will in turn facilitate the identification of the scope of any discretion and what constitutes relevant (mandatory) considerations that the Board is required to take into account.
22 A person who has suffered pecuniary loss or property loss by reason of any defalcation by a licensee has (subject to the limitations in s 116 and s 117) a right to claim reimbursement from the Fidelity Account for that loss.
23 Section 117 details the avenues that a claimant has for obtaining reimbursement from the Fidelity Account. There are only two. The first avenue is if the Board exercises its discretion to settle the claim against the Fidelity Account. Settle means allow or admit the claim in whole or in part: s 117(3) refers to any claim 'admitted' against the Fidelity Account; s 120(1) and s 123(3) refer to claims 'allowed' against the Fidelity Account.
24 The second avenue is by a judgment in an action against the Board: ss 117, 118, 120 of the Act. I respectfully agree with the Tribunal that, on its proper construction, s 117(1) allows the commencement of an action in relation to reimbursement from the Fidelity Account in two circumstances being first, with the leave of the Board and secondly, without the leave of the Board providing two pre-requisites exist being:
(ii) the claimant has exhausted all relevant rights of action and other legal remedies against the defaulting licensee or any other person in respect of the loss suffered by the claimant.
25 The requirement that the Board has 'disallowed' the claim requires that the Board reject the claim. This meaning is consistent with s 116(2) and s 124 (which refers to rejecting the claim) of the Act.
26 The requirement that the claimant 'exhaust' all relevant rights of action and remedies is not satisfied by the voluntary settlement of an action before trial, whether reasonable or otherwise. Ordinarily, it would require the action to be pursued to judgment. There would be exceptions such as if the defendant is bankrupt. I leave for subsequent consideration whether it also requires the claimant to execute on the judgment.
27 The respondents' contentions were based in part on their view that the Board could require a claimant to exhaust all his or her rights of action against the defaulting licensee (and other relevant persons) before considering or making a decision in relation to a claim. Such a course would be beyond the Board's power. The Board has a duty to consider and make a decision in relation to claims: Re Real Estate and Business Agents Supervisory Board; Ex parte Cohen [1999] WASCA 47; (1999) 21 WAR 158 [122] (Cohen No 1). There may be situations where it is appropriate to defer a decision in relation to a claim but that cannot be for the purpose or with the object of requiring or pressuring the claimant to first litigate his or her claim against the defaulting licensee or others.
28 As to the range of possible decisions (and without intending to be exhaustive), the Board may in the exercise of its discretion settle (admit or allow) the claim in whole or in part or the Board may disallow (reject) the claim. Further, the Board may decline to either settle or disallow the claim if, in the exercise of its discretion, it concludes that it is appropriate to grant leave to the claimant to take action against the Board to vindicate the claim. The Board may also grant leave to take action after it has disallowed a claim. That may be appropriate when it is unreasonable to require the claimant to exhaust all rights of action because, for example, the licensee is impecunious.
29 Against that background, I turn to the central issue in this case which is whether the defences in an action referred to in s 118 are also relevant to the Board's decision to settle or disallow the claim. The answer to that question must be in the affirmative. The avenues for obtaining reimbursement of a claim are closely related. They bear some similarity to the position of any potential defendant who will ordinarily consider whether to settle a claim or defend an action. An action against the Board will be determined by reference to whether the claimant has proven the necessary elements to establish an entitlement to reimbursement and whether the Board has established any s 118 defence. That is, the action will be determined on its legal merits. The Board must have regard to those same issues in determining whether to settle or disallow the claim. In an action, the material elements of the claim and any defence are determinative not discretionary. They can also be determinative of the Board's decision in relation to a claim. For example, the Board could not settle the claim if the evidence before it established there was no defalcation or that the defaulting licensee had a complete s 118 defence to the claim. A s 118 defence is relevant and potentially determinative of the claim whether in the exercise of the Board's powers to settle or reject the claim or in any judicial adjudication of that claim.
30 The remaining issues are whether the release under the settlement deed is a defence under s 118 and if so, whether the answer would be the same if the action against the Board was illusory because it could not be litigated in any court in this State.
31 The respondents accept that the release in cl 3 of the settlement deed would be a good defence to any action by them against Brewer and Banning in relation to the defalcations the subject of claim against the Fidelity Account. The respondents contend that the release of a defaulting licensee, like res judicata and bankruptcy, is not a defence under s 118 of the Act. They claim the phrase 'would have been available' in that section points to a legislative intention to confine the defences to those available at the time of the defalcation or alternatively to defences available with respect to the conduct complained of (that is, the defalcation). This latter formulation is very broad and in my view wide enough to include the release given by the claimants.
32 I propose to start with the question whether bankruptcy is a s 118 defence. Section 58(3) of the Bankruptcy Act 1966 (Cth) provides that it is not competent for a creditor to enforce any remedy or, except with the leave of the court, commence or take any fresh step in any legal proceeding in respect of a provable debt. The section does not affect the nature or extent of a bankrupt's liability in relation to a claim that is a provable debt but protects the legislative scheme for the equitable division of the bankrupt's property amongst his creditors.
33 In my view, s 58(3) does not provide a defence to which s 118 applies. Although the Act creates a statutory right to reimbursement, it does not expressly identify any defence to the statutory claim. The defences in s 118 must refer to defences to other causes of action known to the law that are based on the material facts of the statutory claim. Further, the defences are to be identified by reference to the defaulting licensee being a notional defendant in place of the Board in an action under the Act. Against that background, the defences must be to the claim not to the enforcement of the claim in the action in which the defaulting licensee is only the notional defendant. It would be a very odd result if the legislature intended to make the defaulting licensee's bankruptcy a defence to an action against the Fidelity Account. I am aware that this analysis would also exclude a limitation defence that barred the remedy not the right. That is consistent with s 116(2), of the Act which appears to cover the field in relation to limitation for claims under Pt VIII of the Act.
34 Res judicata on the other hand is a defence to a claim in a legal proceeding which, if made out, is a complete bar to the claim: Chamberlain v Deputy Commissioner of Taxation [1988] HCA 21; (1988) 164 CLR 502; Blair v Curran [1939] HCA 23; (1939) 62 CLR 464. The defence is available where an action has been brought and judgment has been entered in that action. If the cause of action is held to exist and judgment is given, the cause of action is said to be merged in the judgment and no longer has an independent existence: Blair v Curran (532). If it was held not to exist, the unsuccessful plaintiff may no longer assert that it does: Effem Foods Pty Ltd v Trawl Industries of Australia Pty Ltd (Receivers and Managers Appointed) (in liq) [1993] FCA 342; (1993) 43 FCR 510. Res judicata only arises from a judgment on the merits and applies to parties and their privies. It was accepted by the parties that the Board would be a privy of the defaulting licensee for the purposes of s 118 of the Act.
35 It is clear from reading s 117(1) together with s 118 of the Act that the legislature did not intend res judicata to be a s 118 defence. That is apparent from the requirement in s 117(1) that if the Board disallows the claim, the claimant must exhaust all relevant rights of action and legal remedies available against the defaulting licensee before taking action against the Board. However, that reasoning has no application to a voluntary release of the defaulting licensee by the claimant.
36 Moreover, the voluntary release of a defaulting licensee would have the effect of depriving the Board of the intended effect of subrogating it to the position of the claimant who has received moneys from the Fidelity Account. The intention of s 119 is to put the Board in a position analogous to an insurer: Cohen No 1 [122]; Real Estate and Business Agents Supervisory Board v Cohen [2004] WASCA 19; (2004) 28 WAR 475 [8]. In Sydney Turf Club v Crowley [1971] 1 NSWLR 724, Mason JA said:
Where an insurer is subrogated to the rights of the insured against a third party, the insured does not acquire an independent cause of action in his own right. He succeeds to the insured's cause of action against the third party ... That right of action remains in all respects unaltered; it is brought in the name of the insured and it is subject to all the defences which would be available if the action had been brought by the insured for his own benefit [734].
37 Thus, the release in the settlement deed would be a good defence to an action against the defaulting licensees that would defeat the Board's subrogated claim under s 119. For example, if the extent of the defalcation was $1 million and the claimant settled for $500,000 and released the defaulting licensee, the Board would be unable to recover from the defaulting licensee the balance of $500,000 paid to the claimant from the Fidelity Account. In contrast, the Board would be subrogated to the claimant's rights against the defaulting licensee under an enforceable judgment or in his bankruptcy.
38 The Respondents contend that if a settlement was unreasonable, the Board could disallow a claim for all or part of the balance on the ground that the defalcation did not cause the entire loss or reduce the amount paid under s 117(2). I doubt the correctness of both propositions. They also point out, correctly, that the right of subrogation in s 119 applies to third parties and that there is a public interest in promoting settlement of litigation. However, I am not persuaded that these matters, even if all are correct, justify the construction of s 118 for which the respondents contend. It is unlikely the legislature intended that a claimant could by his or her voluntary act defeat the Board's right to pursue recovery from the defaulting licensee.
39 The phrase 'would have been available' in s 118 is not in my view intended to confine the defences to those available at the time of the defalcation but instead to refer to defences that would have been available if the defaulting licensee was the notional defendant. I see no reason in the language of s 118 or in principle for reading down the phrase 'all defences that would have been available to the defaulting licensee' to exclude a defence based on the release in the settlement deed. The defence of res judicata, is an exception based on s 117(2) that does not affect the general scope of what is a s 118 defence. In summary, with the exception of res judicata, s 118 applies to defences to claims (not defences to enforcement thereof) that would have been available to the defaulting licensee if he, not the Board, was the defendant to the action under Pt VIII of the Act. A release is a complete defence to such a claim. The motive for, or reasonableness of, the release or settlement is an irrelevant consideration.
40 This result is consistent with the decision of the Victorian Court of Appeal in Legge v The Law Institute of Victoria (Unreported, VSCFC, Library No BC9000831, 27 April 1990). The court was there concerned with an action against the Law Institute of Victoria for payment from a statutory fund. The claimants had suffered pecuniary loss from a defalcation committed by a solicitor. Section 66 of the Legal Profession Practice Act 1958 (Vic) gave the Council of the Law Institute the power to settle any claim against the fund and the claimant an entitlement, with the leave of the Council or as of right if the Council has disallowed the claim and the claimant had exhausted all rights of action and other legal remedies, to take proceedings against the Law Institute. Section 66(3) provided that:
In any proceedings brought to establish a claim ... all defences which would have been available to that solicitor or person shall be available to the institute.
41 The claimants had taken legal action against the defaulting solicitor and others which action was settled before trial. As part of the settlement, the claimants executed a release of the defendants, including the defaulting solicitor. Thereafter, the claimants commenced proceedings against the Law Institute for compensation from the fund. The Full Court, relying on s 66(3), said that if the claim against the Law Institute had been pleaded against the defaulting solicitor there would be at least two arguable defences arising from the settlement agreement being first, accord and satisfaction and secondly, the release of the defendants. The Full Court held that the defence of accord and satisfaction (which extinguished the claimant's cause of action against the defaulting solicitor) was bound to succeed. It was unnecessary for the court to consider whether the release covered the claim against the Institute.
42 The Board's decision in Ex parte Bowie is not inconsistent with its decision on the preliminary issue in this case or the decision in Legge. The settlement and release of the action in Ex parte Bowie did not apply to the claims against the defaulting licensee.
43 There remains the respondents' contention that the right of action to which s 118 refers is illusory. I infer the next step in the reasoning is that the defences available in the action should not affect the identification of matters relevant to the Board's decision in relation to the claim.
44 I understand the respondents' argument to be that the action in relation to the Fidelity Account is an action in rem not an action in personam and that jurisdiction in rem must be expressly conferred on a court either in the Act creating the right or in the Act conferring jurisdiction on the court.
45 The action in relation to the Fidelity Account is not an action in rem because it does not determine the 'status or disposition' of the property in question being the money standing to the credit of the Fidelity Account: see McGovern v State of Victoria [1984] VicRp 46; [1984] VR 570, 575 - 576. The money standing to the credit of the Fidelity Account is the property of the Board (s 120(1)) and exists to satisfy the liabilities of the Board (s 115(1)). The Act refers to actions and judgments against the Board: s 117(1), (3), (4), (5); s 118; s 120(1), (2), (3). The money standing to the credit of the
Fidelity Account is the sole property available to satisfy the Board's liability and any judgment: s 120. The action in relation to the Fidelity Account referred to in s 117, s 118 and s 120 of the Act is an action in personam against the Board.
46 In any event, jurisdiction whether in personam or in rem can be expressly or impliedly conferred on a court. The Act clearly evinces an intention that a claimant, under certain conditions, has a right of action in the courts of this State that exercise civil personal jurisdiction.
47 The review of decisions made under s 116 and s 117 of the Act is a merits review by the Tribunal. The review applies to decisions of the Board as to settlement and disallowance of claims and leave to take action against the Board. The right of review under s 23 is not co-extensive with, or a substitute for, the right of action against the Board which authoritatively determines the claimant's entitlement to compensation from the Fidelity Account.
48 For these reasons I would allow the appeal and dismiss the notice of contention. The orders made by the Tribunal on 12 January 2007 should be set aside and the Board's order upheld.
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
CITATION : REAL ESTATE AND BUSINESS AGENTS SUPERVISORY BOARD -v- ESPANOL HOLDINGS PTY LTD (in liq) [No 2] [2008] WASCA 109 (S)
BETWEEN : REAL ESTATE AND BUSINESS AGENTS SUPERVISORY BOARD
ESPANOL HOLDINGS PTY LTD (in liq) (ACN 009 087 334)
Jurisdiction : STATE ADMINISTRATIVE TRIBUNAL OF WESTERN AUSTRALIA
Coram : HON R VIOL (SUPPLEMENTARY DEPUTY PRESIDENT)
Citation : ESPANOL HOLDINGS PTY LTD & ANOR and REAL ESTATE & BUSINESS AGENTS SUPERVISORY BOARD [2007] WASAT 5
Orders - Costs - Application of public interest litigation principles - Turns on own facts
1 JUDGMENT OF THE COURT: These reasons relate to the orders and costs of the appeal in Real Estate and Business Agency Advisory Board v Espanol Holdings Pty Ltd (in liq) [No 2] [2008] WASCA 109. The parties agree as to the terms of the proposed orders save in relation to the costs of the appeal.
2 The respondents were unsuccessful in the appeal and on their notice of contention. However, they contend the court should not follow the ordinary rule that a successful litigant should be awarded its costs for two reasons. First, they contend that the appeal was public interest litigation sufficient to warrant the appellant being deprived of its costs, relying on Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72. The public interest elements were identified as the interpretation of legislation protecting the public interest, being the creation and regulation of the Fidelity Fund, and the fact that the appellant is a publicly funded body required to administer the Fund.
3 Oshlack was a case where the unsuccessful party legitimately claimed to represent the public interest rather than merely a private interest. Mr Oshlack proceeded under s 123(1) of the Environmental Planning and Assessment Act 1979 (WA) which provided that any person might bring proceedings for an order to remedy or restrain breaches of that Act. This conferral of standing on a member of the public was an important factor in the decision of the majority in Oshlack. See Buddhist Society of Western Australia (Inc) v Shire of Serpentine-Jarrahdale [1999] WASCA 55. In contrast, Pt VIII of the Real Estate and Business Agents Act 1978 (WA) gives to persons who have suffered loss by reason of any defalcation of a licensee a statutory private right to compensation from the Fund. The litigation related to a claim to a private right of the respondents. The fact that the resolution of the issue involved the interpretation of Pt VIII of the Act is a common feature of litigation which does not justify departure from the usual rule as to costs. Hollier v Australia Maritime Safety Authority (No 2) [1988] FCA 975.
4 Secondly, the respondents claim the appellant 'elected' and exercised a 'discretion' to avail itself of a technical legal defence to block the respondents' otherwise valid claim. That is a misstatement of this court's reasons in the appeal [29].
5 We are not satisfied that the circumstances justify a departure from the ordinary rule that a successful litigant should be awarded costs. We hereby order that:
(3) The notice of contention be and is hereby dismissed.
(4) The orders of the State Administrative Tribunal (SAT) made on 12 January 2007 in Espanol Holdings Pty Ltd v Real Estate and Business Agents Supervisory Board [2007] WASAT 5 (VR 146 of 2006) be and is hereby set aside and in lieu thereof it be ordered that the respondents' application to SAT be dismissed.
(5) The respondents pay the appellant's costs of the appeal, including the costs of the respondents' notice of contention and any reserved costs, to be taxed.
(1998) 193 CLR 72
(1999) 21 WAR 158
(1988) 164 CLR 502
(1939) 62 CLR 464
(1993) 43 FCR 510
(2004) 28 WAR 475