Skiba v Serendipity

The Tribunal's power to award costs

1. In this case, the Tribunal's power to award costs is set out in s 60 of the NCAT Act. That section provides as follows: 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. (5) In this section: costs includes: (a) the costs of, or incidental to, proceedings in the Tribunal, and (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.
2. As can be seen from s 60(1), the ordinary rule is that each party to proceedings before the Tribunal are to pay their own costs. However, the Tribunal is given the discretion to make an order for costs where it is satisfied that there are special circumstances warranting an award of costs.

The respondent's submissions

1. The respondent submitted that special circumstances did exist in this appeal that warranted an award of costs in its favour. It was submitted that, based on the principles set out in CPD Holdings Pty Ltd t/as The Bathroom Exchange v Baguley [2015] NSWCATAP 21, the circumstances of the appellants claim and appeal were 'out of the ordinary' in the following ways: 1. the appellant's case as a whole was patently hopeless and failed to engage with reality. It had no tenable basis in fact or law (s 60(3)(c)) and was frivolous, vexatious, misconceived and lacking in substance (s 60(3)(c)). In this regard the respondent pointed to our findings, at [72]-[74] and [79] of our reasons for decision that the appellant had no prospects of success in her appeal or her claim before the Tribunal and that her claim before the Tribunal was misconceived. The respondent also pointed to our finding at [78] of our reasons for decision that the appellant's claim before the Tribunal was based on a misunderstanding and that it was difficult to understand why the appellant had pursued such matters; 2. the appellant's pursuit of her appeal was dogged, but far from diligent. It was submitted that although the appellant had provided a satisfactory explanation for the delay in lodging her appeal, it was nonetheless out of time, the consequence of which was to deprive the respondent of its right to be able to rely on the judgement given by the Tribunal at first instance. The respondent submitted that as the appellant may well persist with a further stage of appellate review, it should be brought home to her that she faces cost consequences if she does so; and 3. the appellant's case was based on a distorted view of the evidence and law and in response, the respondent was required to undertake extensive work, including seeking the assistance of counsel so as to address the matters raised satisfactorily. Hence it became necessary for the respondent to consider closely a number of provisions of the Fair Trading Act governing the jurisdiction of the Tribunal and the complex legislative framework of the Federal social security system. The respondent submitted that none of that work would have been necessary had the appellant behaved reasonably and refrained from imposing unnecessary costs on the respondent at first instance and on appeal.

The appellant's submissions

1. In her submissions the appellant contended: 1. there are no special circumstances warranting an award of costs in favour of the respondent; 2. her consumer claim had a legal basis under the Fair Trading Act 1987; and 3. our decision contained errors of law and should not be considered in deciding whether costs should be awarded in favour of the respondent.
2. The appellant went on to make submissions on those matters she contended we had erred in law.
3. It is unnecessary for us to deal with these matters, as the appellant's application for an extension of time within which to appeal has been heard and determined.

Consideration

1. As noted above, the first matter to consider is whether 'special circumstances' exist, warranting an award of costs under s 60(2) of the NCAT Act.
2. In CPD Holdings Pty Ltd t/as The Bathroom Exchange v Baguley (supra), at [24] to [31], the Tribunal considered the meaning of the words 'special circumstances' as applied in other decisions of the Tribunal (including the Appeal Panel). At [29], the Tribunal cited with approval the following remarks of the former Administrative Decisions Tribunal in Gizah Pty Limited v AXA Trustees Limited (No 2) [2001] NSWADT 164 in regard to s 88 of the Administrative Decisions Tribunal Act 1997, which was in similar terms to s 60 of the NCAT Act: 29 In Gizah Pty Limited v AXA Trustees Limited (No. 2) [2001] NSWADT 164 the ADT considered another application for costs. The ADT stated: 29 Consequently, I am of the opinion that in order to satisfy the test of "special circumstances" one must find circumstances that are out of the ordinary, but without having to be extraordinary or exceptional, and those special circumstances would warrant an award of costs. . . 30 Each case depends upon on its own particular facts. . . 31 In Hoblos v Marchese [1999] NSWADT 127 the Tribunal refused to find "special circumstances" and in support of its opinion relied upon numerous cases .The Tribunal correctly (in my respectful view) observed that the discretion under section 88 is not unfettered, required that the Tribunal "must take into account all the circumstances" and that the "discretion to displace (the ordinary rule that costs follow the event) is a judicial one requiring the private and public proposes of the rule to borne in mind."
3. It is accepted that the mere fact of an applicant being unsuccessful in his or her application or appeal does not of itself amount to special circumstances.
4. In Obieta v Australian College of Professionals Pty Ltd [2014] NSWCATAP 38, at [81], the Appeal Panel also held that it does not follow that where one or more of the factors in s 60(3) are made out, that a cost order should be made. In this regard the Appeal Panel noted that where one or more of the factors in s 60(3) is made out, the Tribunal must nevertheless weigh whether those factors are sufficient to amount to 'special' circumstances that justify departing from the ordinary rule that each party bear their own costs.
5. Ultimately, it is a question of fact, having regard to the circumstances of the matter before the Tribunal, as to whether there are special circumstances warranting a departure from the ordinary rule that each party pay its own costs.
6. In this case, while the appellants appeal related to a claim she had made against the respondent under the Fair Trading Act, it was not a claim for which she sought an order for the payment of an amount exceeding $10,000. Hence, the cost provisions in s 60 applied: see Civil and Administrative Tribunal Rules 2014 (NSW), cl 38.
7. The appellant has at all times been self represented and while we found that, on the material before us, her claim was misconceived and had no prospects of success if time were to be extended to lodge her appeal, we do not find that this constituted special circumstances.
8. As we noted, at [70] and [71] of our reasons for decision, we were satisfied, on the material before us, that it was arguable that the appellant was a consumer falling within the terms of s 79H(a) of Part 6A of the Fair Trading Act and that the respondent had provided 'services' to the appellant as defined under that Act. However, we were not satisfied that those services were provided in trade and commerce, as required under s 79F(1) of the Fair Trading Act.
9. Even though we were satisfied on the material before us that the appellant's claim was misconceived, we are not satisfied that she lacked diligence in bringing her application for an extension of time to bring her appeal or in prosecuting her application and substantive appeal. Nor were we satisfied that the appellant was frivolous or vexatious in bringing her appeal.
10. That the appellant may appeal our decision, in our view, is not a relevant to the question of whether there are special circumstances warranting an order for costs.
11. While there was no onus on the respondent in the claim before the Tribunal, or in the appellant's application for an extension of time to bring her appeal, the respondent acknowledges the complex legislative framework of the federal social security system. It is understandable that the appellant, or the Tribunal may not have fully grasped the complexity of that system and whether the services provided by the respondent were provided in trade and commerce. In our opinion, it is also arguable that, on the material before us, the respondent did not fully grasp these complexities. In making this remark we are not critical of the respondent, but merely wish to point out that the legal issues raised by the appellant in her appeal was not entirely without merit.
12. Accordingly, we are not satisfied that the respondent has established that there are special circumstances that warrant are departure from the general rule that each party pay its own costs.

Orders

1. For the reasons set out above, we make the following orders: 1. A hearing of the respondent's application for costs is dispensed with under s 50(1)(c) of the Civil and Administrative Tribunal Act 20013 (NSW). 2. The respondent's application for costs is dismissed.

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. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 28 November 2019