Simpson v Torning [2026] NSWCATAP 107;

"2025/232686

1. The Tribunal declares pursuant to section 11 of the Residential Tenancies Act 2010 that the agreement between the applicant and the respondent in respect of the bedroom located at 66 Thirteenth Street, Warragamba NSW fell within the exception in section 8(1)(c) of the Residential Tenancies Act 2010 and as such is not a residential tenancy agreement to which the Residential Tenancies Act 2010 applies.

2. The application is otherwise dismissed.

2025/283664

1. The application is dismissed."

(a) by way of introduction, it sets out details of the background, the two CCD proceedings and the evidence ([1]-[10]);

(b) it finds that it has jurisdiction ([11]-[13]);

(c) it sets out the law with respect to the existence of a lodging arrangement to which the RT Act does not apply ([14]-[21]);

(d) it summarises the evidence of the parties ([22]-[32]);

(e) it finds that the agreement between the parties was not a residential tenancy agreement to which the RT Act applied ([33]-[41]);

(f) it finds that Mr Torning is not entitled to relief in the Torning proceedings and to a costs order against Mr Simpson ([42]-[50]).

1. On 26 November 2025, Mr Simpson as the appellant commenced this appeal against Mr Torning as the respondent by lodging a notice of appeal in which he:

(a) challenged the orders made on 30 October 2025 in the Simpson proceedings;

(b) set out the following grounds of appeal (as summarised by the headings):

"- Tribunal mischaracterised a long-term exclusive-possession tenancy as lodging.

- Tribunal ignored evidence proving tenancy since 2016.

- Tribunal failed to consider rent receipts and exclusive use of premises.

- Tribunal allowed lawyers despite Appellant's PTSD and cognitive injury.

- When Appellant informed Member of PTSD triggers, Member replied: "What do you want me to do with these?"

- Procedural unfairness and failure to make reasonable adjustments."

(c) set out the orders the Appeal Panel should make:

"- Set aside declaration under s 8(1)(c) RTA.

- Declare agreement a residential tenancy agreement.

- Remit matter for rehearing before different Member."

(d) sought leave to appeal on the grounds that the decision under appeal was not fair and equitable and against the weight of evidence, and significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with).

1. On 1 December 2025, Mr Simpson lodged an application for a stay in which he sought a stay of the orders made on 30 October 2025 in the Simpson proceedings (the stay application).
2. On 1 December 2025, the Appeal Panel constituted by myself dismissed the stay application in so far as Mr Simpson sought an ex-parte interim stay, listed the appeal for a call over and the hearing of the stay application on 12 January 2026, and made procedural directions for the lodgement of evidence and submissions in relation to the stay application.
3. On 19 December 2025, Mr Torning lodged Respondent's Evidence and Submissions in Opposition of the Application of that date (the Torning stay documents) comprising submissions (the Torning stay submissions) and evidence by way of correspondence and photographs.
4. On 7 January 2026, Mr Torning lodged his reply to appeal in which he attached and relied on the Torning stay documents in response to the grounds of appeal, and in opposition to the application for leave to appeal, in the notice of appeal.
5. On 12 January 2026, the Appeal Panel constituted by Principal Member S De Jersey made procedural orders for the hearing of the appeal including by order 1 that leave is given to Mr Simpson to be legally represented, by order 2 that leave is given to Mr Torning to be legally represented, by order 3 that the application of Mr Simpson for an adjournment of the call over and the hearing of the stay application is dismissed, by order 4 that Mr Simpson lodge and serve his material in support of the appeal by 23 February 2026, by order 5 that Mr Torning lodge and serve his material in opposition to the appeal by 23 March 2026, by order 6 that Mr Simpson lodge and serve any submissions in reply by 7 April 2026, and by order 7 listing the appeal for hearing on 22 April 2026 at 10.15 AM in Sydney for a half day.
6. On 19 January 2026, the Appeal Panel constituted by Principal Member Dr J Lucy made a consent order adjourning the hearing of the appeal to 13 May 2026 at 10.15 AM in Sydney.
7. On 12 February 2026, Mr Simpson's solicitor, Jason Li, sent on email to the Appeal Registry attaching a request for the withdrawal of the appeal (the 12 February 2026 withdrawal application).
8. On 16 February 2026, the Registrar sent a letter dated 16 February 2026 by email to the parties requesting their comments on the 12 February 2026 withdrawal application.
9. On 19 February 2026, Mr Torning lodged Respondent's Submissions on the Appellant's Withdrawal Application of that date which included the Torning costs application and Mr Torning's submissions on the costs of the appeal (the Torning costs submissions).
10. On 23 February 2026, the Appeal Panel constituted by myself made an order dismissing the appeal upon its withdrawal by Mr Simpson, and procedural orders for the determination of the Torning costs application.
11. On 23 February 2026, Mr Simpson lodged undated Appellants' Submissions (the Simpson costs submissions).
12. On 9 March 2026, Mr Torning lodged Respondent's Submissions on the Appellant's Withdrawal Application dated 6 March 2026 (the Torning costs submissions in reply).

1. The determination of the Torning costs application will involve answering the following two questions:

(1) whether a hearing of the Torning costs application should be dispensed with;

(2) whether a costs order, and if so what costs order, should be made in favour of Mr Torning.

Whether a hearing of the Torning costs application should be dispensed with

1. Mr Torning makes no objection, and Mr Simpson makes no submission, as to whether a hearing of the Torning costs application should be dispensed with.
2. I am satisfied that the issues for determination in relation to the Torning costs application can be adequately determined in the absence of the parties by considering their evidence and written submissions. Accordingly, I have decided pursuant to s 50(2) of the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act) to make an order dispensing with a hearing in relation to the Torning costs application.

Whether a costs order, and if so what costs order, should be made in favour of Mr Torning

1. The Torning costs application is pursuant to s 60(2) of the NCAT Act by reason of the existence of special circumstances that include but are not limited to the factors in s 60(3)(a), (b), (c), (e) and (f). The determination of this application will involve answering the first and may involve answering the second and third of the following three questions:

(1) whether there are special circumstances warranting an award of costs in favour of Mr Torning;

(2) if so, whether the discretion should be exercised to award costs;

(3) if so, what costs order should be made.

1. Before dealing with this issue, it is appropriate to set out the applicable provisions of the NCAT Act and legal principles, and to summarise the evidence and submissions of the parties.
2. Mr Torning in the Torning costs submissions has given evidence as to the quantum of his costs. Mr Simpson in the Simpson costs submissions has in part addressed the quantum of Mr Torning's costs. As this evidence and these submissions relate to the third question as to what costs order should be made which is unnecessary to answer, I have not summarised them to this extent.

1. Part 4 Division 5 (ss 56-63) contains provisions dealing with participation in proceedings in the Tribunal. Section 60 deals with costs, and relevantly provides:

60 Costs

(1) Each party to proceedings in the Tribunal is to pay the party's own costs.

(2) The Tribunal may award costs in relation to proceedings before it only if it is satisfied that there are special circumstances warranting an award of costs.

(3) In determining whether there are special circumstances warranting an award of costs, the Tribunal may have regard to the following -

(a) whether a party has conducted the proceedings in a way that unnecessarily disadvantaged another party to the proceedings,

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

(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 proceedings,

(e) whether the proceedings were frivolous or vexatious or otherwise misconceived or lacking in substance,

(f) whether a party has refused or failed to comply with the duty imposed by section 36(3),

(g) any other matter that the Tribunal considers relevant.

(4) If costs are to be awarded by the Tribunal, the Tribunal may -

(a) determine by whom and to what extent costs are to be paid, and

(b) order costs to be assessed on the basis set out in the legal costs legislation (as defined in section 3A of the Legal Profession Uniform Law Application Act 2014) or on any other basis.

costs includes -

(a) ...

(b) the costs of, or incidental to, the proceedings giving rise to the application or appeal, as well as the costs of or incidental to the application or appeal.

The applicable legal principles under s 60(2) of the NCAT Act

1. In FZK v Secretary, Department of Communities and Justice (No 4) [2025] NSWCATAP 278 (FZK (No 4)) at [31]-[41] and [52], the Appeal Panel set out the general principles applicable to an award of costs under s 60(2) of the NCAT Act including:

(1) the usual rule is that a party is to pay their own costs of proceedings but, as the legislation makes clear, the Tribunal may make an order for costs if satisfied that there are "special circumstances";

(2) the following six leading principles are apposite:

(a) first, special circumstances are circumstances that are out of the ordinary. It is not necessary to establish extraordinary or exceptional circumstances;

(b) secondly, the onus is on the party seeking an order for costs to satisfy the Tribunal that there are special circumstances warranting an award of costs in its favour;

(c) thirdly, the Tribunal is to consider whether the circumstances are sufficient to amount to special circumstances that justify departing from the general rule that each party bear its own costs;

(d) fourthly, each case will depend on its own particular facts and circumstances;

(e) fifthly, mere success (or failure) of an application does not give rise to special circumstances;

(f) sixthly, the discretion to award costs must be exercised judicially and having regard to the underlying principle that parties to proceedings in the Tribunal are ordinarily to bear their own costs;

(3) overall, what is required is for the Tribunal to exercise its discretion in a manner which is fair and reasonable having regard to the particular circumstances of a particular case;

(4) the decision to award costs pursuant to s 60(2) of the NCAT Act involves, in effect, two decisions. The first is the Tribunal's satisfaction that there are special circumstances warranting an award of costs. Satisfaction as to the existence of special circumstances merely enlivens the discretion to award costs rather than mandating an award of costs. This necessitates the making of a second decision as to whether in all the circumstances, an award for costs should be made;

(5) an award of costs is intended to be compensatory and not punitive.

1. The general principles concerning the awarding of costs where proceedings are discontinued or dismissed by consent were considered by McHugh J in Re Minister for Immigration & Ethnic Affairs of the Commonwealth of Australia; Ex Parte Lai Qin (1997) 186 CLR 622 at 624-625; [1997] HCA 6 (Lai Qin):

"In most jurisdictions today, the power to order costs is a discretionary power. Ordinarily, the power is exercised after a hearing on the merits and as a general rule the successful party is entitled to his or her costs. Success in the action or on particular issues is the fact that usually controls the exercise of the discretion. A successful party is prima facie entitled to a costs order. When there has been no hearing on the merits, however, a court is necessarily deprived of the factor that usually determines whether or how it will make a costs order.

In an appropriate case, a court will make an order for costs even when there has been no hearing on the merits and the moving party no longer wishes to proceed with the action. The court cannot try a hypothetical action between the parties. To do so would burden the parties with the costs of a litigated action which by settlement or extra-curial action they had avoided. In some cases, however, the court may be able to conclude that one of the parties has acted so unreasonably that the other party should obtain the costs of the action. ...

Moreover, in some cases a judge may feel confident that, although both parties have acted reasonably, one party was almost certain to have succeeded if the matter had been fully tried. ... But such cases are likely to be rare.

If it appears that both parties have acted reasonably in commencing and defending the proceedings and the conduct of the parties continued to be reasonable until the litigation was settled or its further prosecution became futile, the proper exercise of the cost discretion will usually mean that the court will make no order as to the cost of the proceedings. This approach has been adopted in a large number of cases." (citations omitted)

1. The general principles concerning the awarding of costs where proceedings are discontinued or dismissed by consent as summarised in Lai Qin at 624-625 have been applied in the courts and the Tribunal: see for example Alijagic v Australian Bosnian-Hercegovina Cultural Association Incorporated [2025] NSWSC 393 at [52]- [59] (Kunc J); Karpinski v The Owners - Strata Plan No 1731 [2026] NSWCATAP 12 at [22].

1. Mr Torning in the Torning costs submissions relevantly submits:

(1) Mr Simpson's conduct in the two CCD proceedings was contrary to a reasonable person's ethics for the reasons specified in the Torning stay submissions at [2.7];

(2) the factors in s 60(3)(a), (b), (c), (e) and (f) of the NCAT Act apply to the two CCD proceedings for the reasons specified in the Torning stay submissions at [2.12].

1. Mr Simpson in the Simpson costs submissions relevantly submits:

(1) the only issue presently before the Appeal Panel is the costs of the appeal. Accordingly, any claim relating to the initial proceedings is not properly before the Appeal Panel and should be disregarded;

(2) Mr Torning has not established the existence of special circumstances.

1. Mr Torning in the Torning costs submissions in reply has substantially repeated the Torning costs submissions.

Whether there are special circumstances warranting an award of costs in favour of Mr Torning

1. I am not satisfied that Mr Torning has established that there are special circumstances warranting an award of costs in his favour for the following reasons:

(1) the conduct of Mr Simpson in in the two CCD proceedings is not relevant to the determination of the existence of special circumstances in relation to the appeal;

(2) having regard to the principles in Lai Qin, he has not demonstrated on clear and uncontested evidence in circumstances where there was no hearing of the appeal on its merits that Mr Simpson behaved unreasonably in commencing the appeal, or he was almost certain to succeed on the interconvertible facts, which was evidenced by Mr Simpson's capitulation.

If there are special circumstances warranting an award of costs in favour of Mr Torning, whether the discretion should be exercised to award costs

1. As I have decided there are not special circumstances warranting an award of costs in favour of Mr Torning, these questions do not arise for consideration.

(1) A hearing of the costs application of the respondent is dispensed with.

(2) The costs application of the respondent is dismissed.

(3) Each of the appellant and the respondent is to pay their costs of the appeal.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.