Tanwar Institute of Professional Studies Pty Ltd v Domenic Ruggeri t/as Dom Panino

1. In its reasons of 18 August 2025, the Tribunal identified s 60 of the Civil and Administrative Tribunal Act 2013 (NSW) (CAT Act) as one source of jurisdiction and power to award costs.
2. The Tribunal also identified [11] rule 38 of the Civil and Administrative Tribunal Regulations 2013 (NSW) (NCAT Rules) which has application with respect to costs in the Consumer and Commercial Division of the Tribunal. The rule provides (38(2)) that the Tribunal "may" award costs in proceedings, in the absence of special circumstances warranting such an order, if relevantly:

"(b) the amount claimed or in dispute in the proceedings is more than $30,000"

1. The Tribunal referred [12] to the decision in Allen v TriCare (Hastings) Ltd [2017] NSWCATAP 25 in relation to the meaning of "amount claimed" and "amount in dispute". The Appeal Panel there held [43] that "In the case of an internal appeal, the "amount claimed ... in the proceedings" can be determined by considering what orders the appellant seeks on the appeal. If those orders sought include an order that the respondent pay a sum of more than $30,000, expressly or impliedly, then the Tribunal should conclude that the amount claimed in those proceedings was more than $30,000. If the substantive orders do not involve any express or implied claim to any amount, it is difficult to see how there is any "amount claimed" for the purposes of r 38(2)(b)."
2. The Tribunal referred [13] to the statement by the Appeal Panel in Allen at [48] that "The inclusion of the words "or in dispute" after "the amount claim" in r 38 indicates that amounts may be in dispute in proceedings even if they are not the subject of a specific claim for an order for payment".
3. The Tribunal recorded [14] that the competing costs applications "appear to have been made on the basis of a mixed result for both litigants from in essence the one case", a proposition with which the Tribunal recorded [15] its agreement. The Tribunal proceeded [15] "on the basis that there were in fact two proceedings (although one judgment)".
4. The Tribunal recorded [16] that the Lessee submitted that he had succeeded on his claim, and that the Lessor's Cross-Claim was dismissed and that, as such costs should "follow the event". The Tribunal identified the "event" as the award of $16,167 to the Lessee on his claim, and the dismissal of the Lessor's Cross-Claim "entirely".
5. The Tribunal recorded [17] the submission of the Lessee that r 38 was engaged as the amount claimed or in dispute, in both proceedings, exceeded $30,000.
6. The Tribunal referred [18] to the Lessee's submissions with respect to "special circumstances" pursuant to s 60 of the CAT Act, and, [19] to the Lessor's submission with respect to "special circumstances", the crux of which was that the Lessee had originally claimed $176,225 but been awarded $16,167.
7. The Tribunal referred [20] to the "substantial damages" claimed by the Lessee for breaches of a lease between the parties, and "certain provisions" of the Retail Leases Act 1994 (NSW) (RLA). The Tribunal identified [21] the breaches of s 17 of the RLA relied upon by the Lessee, and [22] the basis of the damages $110,481.32 and continuing, claimed by him.
8. The Tribunal referred [23] to its finding in the substantive proceedings at [69] that "By 28 January 2023 the Respondent (Lessor) had substantially complied with its fit out obligations". The Tribunal found [24] that "Any damages in relation to a breach of s 17 of the RLA ended at the date in which the fit out obligations were substantially complied with [98] being some four weeks after commencement of the lease resulting in damages of only $16,167".
9. The submission on behalf of the Lessor was recorded [25] as being that "Given the determination by the Tribunal of the much lesser amount, not only is there no basis in law, but given the submissions advanced by the Lessee, there was not even an arguable basis at law to press the "continuing breach" claim".
10. The Tribunal referred [26] to the Lessor's claim for costs pursuant to s 60(2) of the CAT Act in reliance upon alleged "special circumstances", and particularly the "relative strengths of the claims that have been made by each of the parties, including whether a party has made a claim that has no tenable basis in fact or law". The Tribunal recorded [27] that the submission of the Lessor that it take into account "that the dispute over the fit out obligations constituted the majority of the proceedings with respect to the amount of evidence adduced, the number of witnesses called, and the time allocated for hearing of the relevant arguments". The submission of the Lessor that "had the continuing breach claim of Lessee been properly assessed and appropriately reduced to the period of the breach, as the Tribunal ultimately found, the substantive proceedings of the Lessee's claim would have been far shorter in time, if not fully resolved as the amount sought in damages would have favoured settlement over a contested hearing" [28]. The Tribunal found [29] that "The conduct of the Lessee in not doing such allows the Tribunal to readily find special circumstances consistent with s 60(3)(c) of the NCAT Act" and award costs to the lessor.
11. The Tribunal referred [31] to the Lessor's emphasis on the Lessee's claim under s 17 of the RLA, and the Tribunal's findings in that regard to which reference had earlier been made and the submission of the Lessor that "In short the Lessee clearly knew when the obligations were complied with yet still pressed for an ongoing continuing breach which was not tenable in fact and in law". The decision of the Appeal Panel in Vella v Mir (No. 3) [2020] NSWCATAP 17 at [28]- [33] was referred to by the Tribunal, at [32]. It was there held that "The proper exercise of the discretion requires the decision maker to do justice between the parties and to exercise the discretion having regard to relevant considerations and in a manner which is not arbitrary and capricious".
12. The Tribunal reasoned [43] that to "merely award costs because the Lessee was awarded some damages would be arbitrary in light of the relevant consideration, namely that the claim only enlivens rule 38 as a result of inflated and ultimately untenable alleged damages" and found that to award costs in those circumstances would "simply encourage future applicants to file viable claims but with inflated damages to surpass the $30,000 threshold of rule 38, knowing that any semblance of success will entitle them to potential costs". The Tribunal proceeded [34] to reiterate, in reliance upon Vella, that the discretion conferred by r 38 required consideration of whether "the amount claimed should be properly reduced to below $30,000 in line with the actual award and rule 38 should not apply".
13. The Tribunal found [35] that in the exercise of its discretion it was not satisfied that the Lessee "overinflated the amount of damages being claimed" and was persuaded, by reference to Zucker v Burbank Montague Pty Ltd [2018] NSWCATAP 135 at [44] where the Appeal Panel held that "A finding that a claim is "not proved on the balance of probabilities" is not the same as a finding that a claim is "not tenable in fact or law". They are different concepts. The expression "no tenable basis in fact or law" relates to the common law tests developed and applied" in the High Court decisions referred to and that, for a claim to have no tenable basis in fact or law "it must be so obviously untenable that it cannot possibly succeed".
14. The Tribunal relied [37] on the Lessee's success on its claim for breach of s 17 of the RLA, but "not in respect of the quantum" but found that did not make the claim "untenable" or "overinflated". The Tribunal was unable [38] to "find a basis upon which the Lessor would be entitled to costs". The thrust of the submissions on behalf of the Lessor being considered to more "actually go" to whether the discretion should be exercised in favour of the Lessee.
15. The Tribunal ultimately considered [39] that having considered the submissions by the Lessor, "notwithstanding the limited success of the Lessee's claim, the Lessee is still the successful party and entitled to its costs".

1. The Appellant filed submissions in support of its appeal on 14 November 2025. The Respondent filed submissions in opposition to the appeal on 11 February 2026. On 25 February 2026 the Appellant filed submissions in reply. The parties provided a Court Book containing all of the material which was before the Tribunal at first instance.

1. The Appellant appeals as of right on 3 grounds which, if established, would demonstrate error on a question of law. The Appellant does not seek, or require, leave to appeal pursuant to s 80(2)(b) of the CAT Act.
2. The Respondent does not dispute that the grounds relied on by the Appellant in its Amended Notice of Appeal assert error on question of law.
3. The Appellant's grounds assert:

Ground 1 - An error in the "interpretation, and in turn, application, of the principle exposed in Zucker v Burbank Montague Pty Ltd [2018] NSWCATAP 135 at [44] with respect to whether the lessee's claim was untenable or not, as the lessee's claim ought to be considered as pleaded, made, and in full, not whether a version of the claim is tenable";

Ground 2.2 - An error in law on the application of s 38(2)(b) of the Rules by applying an arbitrary approach to the question, as opposed to exercising the discretion, having regard to relevant considerations and doing justice between the parties"; and

Ground 2.3 - Pursuant to grounds 1 and 2.2 the Lessor has been "unfairly prejudiced by the fact that a version and/or part of the Lessee's claim being untenable" but in excess of the threshold provided by r 38(2)(b) enlivens the discretion to award costs.

1. In the course of oral submissions, Counsel for the Lessor, correctly in the Appeal Panel's view, confirmed that pivotal to the Lessor's challenges to the decision of the Tribunal at first instance was an asserted failure to have regard to relevant considerations (ground 2.2). Counsel for the Lessor confirmed, correctly in the Appeal Panel's view, that no part of the challenges to the decision at first instance involved, expressly or impliedly, "weight" challenges. Failure to have regard to a relevant consideration constitutes error on a question of law (Micallef v ICI Operations Australia Pty Ltd [2001] NSWCA 274).
2. Although the Lessor's grounds of appeal do not raise challenges to the adequacy of the reasons of the Tribunal at first instance, as is usually the case, the asserted failure to refer to a relevant consideration in the reasons was submitted to confirm that the Tribunal had failed to have regard to those relevant considerations (Carrascalao v Minister for Immigration and Border Protection (2017) 347 ALR 173; [2017] FCAFC 107).
3. Both parties referred in their submissions to the decision of the Appeal Panel in Vella [28]-[33]. In reliance upon Vella, and the decision of BNT Constructions Pty Ltd v Allen [2017] NSWCATAP 18 to which reference was made in Vella the "rule 38 principles" were submitted, accurately, to be that:

"(i) the "starting point" is that a successful party should be entitled to a costs order;

(ii) a costs order is compensatory and not punitive;

(iii) there is no absolute rule that, absent disentitling conduct, a successful party is entitled to a costs order;

(iv) the relevant considerations are not confined, as to do so would constrain the Tribunal's discretion;

(v) the relative success of the parties on different issues, and the time taken to determine them may be relevant considerations;

(vi) the nature of the proceedings is a relevant consideration;

(vii) the exercise of discretion requires a decision maker to do justice between the parties, and exercise the discretion having regard to relevant considerations in a manner which is not arbitrary or capricious."

1. In its written submissions, the Lessor referred [10] to the Lessee having claimed damages "of at least $156,070.32", but was ultimately awarded $16,167 in damages [3]. That decision was not disturbed on appeal.
2. The Lessor referred [7] to the components of the Lessee's damages claim pursuant to sections 17 and 34 of the RLA. As Counsel for the Lessee reminded the Appeal Panel, some of those claims were sought in reliance upon alleged breaches of the lease agreement.
3. Counsel for the Lessor explained in some detail [10]-[17] the background to the appeal. By reference to the reasons for the Tribunal's decision in the substantive proceedings. None of those factual matters is controversial in the appeal.
4. The Lessor accepted [23]:

"a. That the Lessee was successful on paper in the substantive proceedings, but notes that only 10% of what was sought was actually awarded.

b. The Lessee's claim did technically seek damages in excess of $30,000, which would generally enliven rule 38. However, for reasons expanded on below, the manner in which those damages were derived, raise considerable issues."

1. The Lessor submitted [24] that an award of costs was not "a purely mechanical operation that must follow" in the event that r 38 is enlivened, the Tribunal having a discretion with respect to costs as the expression "may award" costs as the terms of the rule confirms (Ward v Williams (1955) 92 CLR 496; [1955] HCA 4). The Appeal Panel accepts that the Tribunal at first instance exercised a discretion pursuant to r 38 which was not unfettered.
2. The Lessor asserted, at first instance, and before the Appeal Panel, [29] that the Lessee's claims for damages pursuant to s 34 of the RLA for $35,000 and claim pursuant to s 17 of the RLA for $110,481.32 were "not tenable and/or were overly inflated" such that the discretion under r 38 ought not have been exercised. The Lessor submitted [31] that the Lessee's claim was demonstrably untenable.
3. The Lessor submitted [35]-[36] that, whilst the "question of a tenable claim" as discussed in Zucker requires an applicant to demonstrate that a claim was "so weak as to be unarguable, rather than merely weak" for the purpose of an application pursuant to s 60 of the CAT Act, the exercise of discretion pursuant to r 38 was determined differently. It was submitted that the Tribunal at first instance erred by failing to correctly apply the r 38 principles identified earlier in its submissions.
4. The Lessor submitted [42] that the Tribunal at first instance "stripped away portions of the Lessee's claim, arguably the portions too weak they should not have been pressed" and then awarding costs as a result was "highly prejudicial" to the Lessor who was submitted to have been "required to respond to the Lessee's claims in full and did not have the liberty nor benefit of only addressing the Revised Lessee's Claim". With respect to Counsel for the Lessor, the Lessor has not referred the Appeal Panel to any material which could advance that submission. Such a submission may have had merit in an appeal against the substantive decision but, that decision having not been disturbed on appeal, the Tribunal at first instance proceeded, and the Appeal Panel proceeds, on the basis of that decision for the purpose of the costs dispute.
5. The Lessor submitted [43] that the Tribunal at first instance having found that the Lessee's claim was "not overly inflated" contradicted other findings within the Judgment. It was further submitted that if the amounts sought were not overinflated, then far more substantial damages should have been awarded than the Tribunal did award.
6. No ground of appeal alleges that the Tribunal at first instance decided the costs issue in reliance upon a material error of fact. The Tribunal's finding in that regard has not been expressly or impliedly shown to have been plainly wrong (Noble v Edwards v Noble (1971) 125 CLR 296; [1971] HCA 63) or wrong in reliance upon a credit finding (Fox v Percy (2003) 214 CLR 118; [2003] HCA 22). The Lessor is undoubtedly correct to submit that the quantum of the Lessee's failure in the substantive proceedings was a relevant consideration.
7. As the written and oral submissions of Counsel for the parties confirm, the focus of this ground is ultimately whether the Tribunal erred in principle by conflating s 60 CAT Act and r 38 considerations. The Tribunal at first instance recorded [14] that the competing costs applications "appear to have been made on the basis of a mixed result for both litigants from in essence the one case".
8. The Tribunal accepted [15] that the result was "mixed" but, proceeded "on the basis that there were in fact two proceedings (although one judgment)". As is not in doubt, the two proceedings were the Lessee's claim for $156,070.32 and the Lessor's Cross-Claim for $22,000.
9. The Tribunal recorded [16] accurately, that the Lessee was wholly successful in resisting the Lessor's Cross-Claim and that the Lessee was successful only in the sum of $16,167 on his claim.
10. Under the heading "Lessor's costs claim in the Lessee's claim", the Tribunal at first instance considered in detail the Lessor's costs claim noting [26] that the claim was made in reliance upon s 60 of the CAT Act. The Lessor having sought less than $30,000, any costs claim made by it was necessarily pursuant to s 60 of the CAT Act. The Lessor has not challenged the Tribunal's rejection of its costs claim. The crux of this ground is the asserted "conflation" of s 60 CAT Act and r 38 considerations.
11. The Tribunal identified [31], accurately, the crux of the Lessor's claim. The Tribunal then referred [32] to Vella, it being readily apparent, and even more so from the observations at [34] that the Tribunal was engaging with the Lessee's r 38 application. The Tribunal referred [35], to the Lessor's contention that the Lessee "overinflated the amount of damages being claimed" and referred, correctly, to the distinction recognised in Zucker between a finding that a claim is not proved on the balance of probabilities, and a finding that a claim is not tenable in fact or law. The Tribunal referred [37]-[39] to the merits of the Lessee's r 38 application. Irrespective of whether the Lessor succeeds with other grounds agitated by it, this ground has not been made out.
12. The Tribunal was required to, and did, consider the Lessor's costs claim pursuant to s 60 of the CAT Act. The Tribunal's rejection of the Lessor's costs claim has not been submitted, formally or otherwise, to have been infected with error. The Tribunal's reasons adequately demonstrate that the s 60 CAT Act considerations and the r 38 considerations were not "conflated". As the Tribunal recognised, there were two proceedings which resulted in one judgment. This challenge fails.

1. Ground 2 emerged from oral submissions of Counsel for the parties as pivotal to the outcome of the appeal. The Lessor submitted [44] that the decision to award the Lessee costs (Decision at [39]) "conflicts with both point 3 and 5 of the r 38 principles, and, consequently, with point 7. Those principles provided that:

"(iii) there is no absolute rule that, absent disentitling conduct, a successful party is entitled to a costs order;

(v) the relative success of the parties on different issues and the time taken to determine them may be relevant;

(vii) the proper exercise of discretion requires the decision maker to do justice between the parties and exercise the discretion having regard to relevant considerations and in a manner which is not arbitrary or capricious."

1. It is not in contest that a relevant consideration was the limited success of the Lessee, as submitted by the Lessor [45] 10% of the initial claim, 4% of the two major "heads of damage", "coupled with the fact that the primary manner in which those damages were calculated was rejected by the Tribunal". It was submitted [46] that the Tribunal's categorisation of the Lessee's success as "limited" grossly misstates what the outcome was and ignores the fact that "relatively miniscule damages" were awarded. In its written submissions, the Lessor submitted that the Tribunal had failed to "properly weigh" those considerations. In oral submissions, Counsel for the Lessor conceded, correctly in the Appeal Panel's view, that no part of the appeal was concerned with the "weight" given to the measure of the Lessee's success, the complaint being that the Tribunal at first instance failed to have regard to that success or, as clarified in oral submissions, failed to give proper, genuine and realistic consideration to that factor.
2. In oral submissions, Counsel for the Lessor confirmed that the basis of this ground was articulated at [47] of Counsel's written submissions. It was there submitted [47(a)] in reliance upon point 5 of the r 38 principles that it was a relevant consideration that the Lessee was awarded only 10% of his claim. It is not in contest that it was a relevant consideration, the issue being whether the Tribunal at first instance had regard to it or gave that factor proper, genuine and realistic consideration.
3. The second matter relied upon [47(b)] "stifled negotiations" cannot advance the Lessor's appeal in circumstances where it was fairly conceded that the Tribunal at first instance had not been referred to any Offers of Compromise or Calderbank offers in support of or opposition to the Lessee's costs claim. Whilst it is undoubtedly correct that it "cannot be held against" the Lessor for not seeking Offers of Compromise, as Counsel for the Lessor acknowledged during oral submissions, the Tribunal is either referred to Offers of Compromise or Calderbank offers or it is not and, in the circumstances of this case, no part of the decision of the Tribunal at first instance involved consideration of such offers or was suggested to have required such consideration in the admitted absence of such offers.
4. The Lessor submitted [47(c)] that the Lessee had "prolonged proceedings". It was submitted, correctly, that "proportionality and commercial realities must be taken into consideration" in the determination of a r 38 costs application. It was submitted that "had the Lessee's damage claim reflected the more appropriate figure determined by the Senior Member of $16,167, there would be strong and compelling reasons for the landlord to have not pursued their Cross-Claim and for the substantive proceedings to not take three days of hearing. Again, by maintaining damages in excess of $156,000 the (Lessor) was stripped of this course of action". It was further submitted [47(d)] that there were "public implications" if the decision of the Tribunal at first instance was permitted to stand in that by effectively "approving" damages claims exceeding $30,000, without any likelihood of ultimately being upheld in order to enliven r 38.
5. If the appeal is dismissed, it will be because, on the facts and circumstances of this case that is the decision which the Appeal Panel arrives at by applying relevant legal principles. That outcome would not have the consequence asserted by the Lessor. With no disrespect to the submissions of the Lessor, that submission underestimates the ability of the Tribunal to discern, and reject, applications which are unreasonably inflated with a view to enlivening r 38.
6. The Lessee submitted [40] that, even if the Appeal Panel applied a "keen eye" attuned to error, the Reasons of the Tribunal at first instance "stand up to scrutiny". The Lessee submitted [47] with respect to principle 5 of the r 38 principles that although the relative success of the parties on different issues may be relevant, the Lessor had failed to demonstrate any more than the disparity in the quantum of the outcome and had failed to demonstrate any of the other considerations which were relevant pursuant to r 5.

1. As recorded above, submissions of Counsel for the Lessor at [47] concisely articulated the real basis of this challenge. The Appeal Panel is not persuaded that the Tribunal at first instance failed to consider, or give proper, genuine and realistic consideration to the extent to which the Lessee unsuccessfully agitated his claim. In the course of its reasons, as recorded earlier, the Tribunal differentiated between a claim which was not found to have been made out on the balance of probabilities and a claim which had no tenable basis in fact or law. Nothing to which the Appeal Panel has been referred establishes that the Tribunal erred in finding that the Lessee's unsuccessful claims fell within the former category. The Tribunal at first instance recognised the measure of the Lessee's failure.
2. The Lessor does not establish this challenge. As noted earlier, the reliance upon "stifled negotiations" cannot advance this challenge in the absence of any evidence of offers, formal or otherwise, to resolve the substantive proceedings or, potentially, the costs dispute. So far as "prolonged proceedings" are concerned, the Appeal Panel has not been referred to anything which demonstrates that the Lessee unreasonably prolonged the proceedings at first instance. It is apparent from the Tribunal's reasons at first instance that there were significant factual disputes with respect to the state of repair and fitness for purpose of the premises the subject of the lease. The Lessor has not demonstrated, either in support of a challenge to a costs order or, which has not been asserted, a proportional costs order, that the Tribunal erred by not having regard to matters which fell within principle five of the r 38 principles. This basis of the challenge fails.
3. For the reasons recorded earlier, the asserted "public implications" of the decision of the Tribunal at first instance surviving appellate challenge are not made out and do not advance this ground. As the ground, and the law recognise, in the absence of the considerations being "mandatory" (Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24; [1986] HCA 40) the relevant considerations for the Tribunal at first instance were those which, through their contentions, the parties submitted to have been relevant, or which the law rendered relevant. The latter are not relied on by either party. It is not in doubt that the Lessor emphasised, in the context of both its costs application and in resisting the Lessee's costs application, the substantial measure of the Lessee's absence of success.
4. The Appeal Panel has not been referred to any other aspects of the conduct of the substantive proceedings with respect to the time taken to determine different issues. Without more, the fact that the Lessor succeeded in relation to the dispute as to when its pre-lease obligations had been completed does not mean, and the Tribunal in the substantive proceedings, did not find that, although unsuccessful, the Lessee's case was demonstrably lacking in merit.
5. Although articulated more skilfully, the crux of this ground is that the measure of the Lessee's absence of success precluded the Tribunal at first instance from having exercised its discretion to award the Lessee his costs. The Tribunal's reasons with respect to that factor were not extensive. Nothing to which the Appeal Panel has been referred establishes however that they should have been more extensive.

1. The success of ground 2.3 was, properly expressed to be contingent upon the success of ground 1 and/or ground 2.1. Neither of those grounds having been made out, ground 3 fails.

1. No ground of appeal having been made out, the appeal will be dismissed. The Tribunal raised with Counsel for the parties a timetable for submissions in relation to costs on the basis that the successful party would be awarded costs on a party and party basis with liberty to either party to seek some other order and for the costs of the appeal to be determined "on the papers".

(2) The Appellant is to pay the Respondent's costs of the appeal as agreed or assessed on a party and party basis.

(3) A party seeking some other order is to file and serve written submissions not exceeding 10 pages in length within 21 days of the Appeal Panel's decision.

(4) A party resisting an application for some other order is to file and serve written submissions in opposition to such order within 42 days of the Appeal Panel's decision.

(5) By consent dispense with a hearing of any application pursuant to these orders in accordance with s 50(2) of the Civil and Administrative Tribunal Act 2013 (NSW).

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.