The Owners - Strata Plan No 31284 v Mustafa, Young and Gallo - [2022] NSWCATCD 136 - NSWCATCD 2022 case summary

Judgment (6 paragraphs)

[1]

REASONS FOR DECISION

This is a costs application from a decision of the Tribunal on 26 May 2022 where the Tribunal made order s pursuant to ss 124 of the Strata Schemes Management Act 2015 (NSW) ('the SSMA').
The Owners - Strata Plan 31284 is the registered proprietor of the common property in Strata Plan 31284. The respondents in the proceedings were Mr Mustafa, the registered proprietor of Lot 60 in the strata scheme and Mr Young and Mr Gallo, the occupants of Lot 60 in the strata scheme.

[2]

TRIBUNAL PROCEEDINGS

The applicant commenced proceedings in the Tribunal on 3 March 2022 seeking orders with respect to access to the respondents' lot to repair a leak emanating from Lot 60 of the strata scheme into the lot directly below, being Lot 49.
On 26 May 2022 the Tribunal made the following orders: 1. Jorge Gallo and Richard Young and Alfesani Mustafa, lot owner/occupiers of Lot 60, must allow access to the Owners Corporation and its authorised contractors for the purpose of:

Enabling the following work to be carried out
As required by the Owners Corporation to ensure compliance with section 106 of the SSM Act and to that effect;
To carry out the scope of work as set out in the Estimate of Forward Plumbing dated 12 May 2022 (provided to the respondents by the applicant). 1. The applicant is to provide to the respondents 72 hours written notice of the date and time of entry. 2. In accordance with section 122(5) of the SSM Act a person must not obstruct or hinder and owner's corporation in the exercise of its function.

CONSIDERATION OF THE COSTS APPLICATION IN MATTER

The applicant submits the following in relation to the cost's application: 1. The respondents were responsible for prolonging unreasonably, the time taken to complete the proceedings. 2. The respondents prohibited the applicant from complying with its strict duty under section 106 of the Strata Schemes Management Act. 3. The conduct of the respondents left the applicant with little option but to bring the dispute before the Tribunal for a final determination. 4. The respondents were provided with ample opportunity both before and commencement of the proceedings and prior to the final hearing to all the applicant access. 5. The protracted time in which the respondents had to comply with their obligations to allow access. 6. The lot owner held himself out to be the occupant of the lot. This was not correct which necessitated an amendment to the respondents to include the occupants. 7. The proceedings were avoidable and the respondents' unwillingness to allow access unreasonably prolonged the time to complete the proceedings, especially in circumstances where reasonable access was again requested from the respondents prior to the hearing. 8. The proceedings were uncontested, and the respondents had no tenable basis to refuse to provide the applicant with access. 9. The applicant incurred unnecessary legal costs as a direct result of the respondents conduct. 10. The lot owner breached his duty under section 36(3) of the NCAT Act which disadvantaged the applicant and further prolonged the time to complete the proceedings. 11. The respondents failed to serve any evidence and failed to attend the hearing. It can therefore be said that the applicant's position was correct and unchallengeable at all relevant times.
Section 60 of the NCAT Act states: 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.
The Appeal Panel of the Tribunal has considered on many occasions the applicable principles in respect of whether or not "special circumstances" apply to depart from the usual position under s 60 (1) of the NCAT Act that each party bears its own costs.
Such principles were summarised in The Owners-Strata Plan No 63731 v B & G Trading Pty Ltd (No 2) [2020] NSWCATAP 273 at [6]-[15] (B & G Trading (No 2) as follows: "6. The general rule set out in s 60(1) was (citing Youssef v NSW Legal Services Commissioner (Costs) [2020] NSWCATOD 115 at [107]): '… designed to promote access to justice generally and to minimise the overall level of costs in tribunal proceedings as far as is practicable: Choi v University of Technology Sydney [2020] NSWCATAP 18 at [41].' 7. In Feng v OzWood (Australia) Pty Ltd [2020] NSWCATAP 42 the Appeal Panel said, at [8], that the discretion to award costs had to be exercised judicially: '...having regard to the underlying principle that parties to proceedings in the Tribunal are ordinarily to bear their own costs. (See eMove Pty Ltd v Naomi Dickinson [2015] NSWCATAP 94 at [48]; CPD Holdings Pty Ltd t/as The Bathroom Exchange v Baguley [2015] NSWCATAP 21 at [23]-[31]; Nguyen & Anor v Perpetual Trustee Company Ltd; Perpetual Trustee Company Ltd v Nguyen & Anor (No 2) [2016] NSWCATAP 168 at [16].)' 8. Section 60(2) says that the Appeal Panel may award costs to a party 'only if' satisfied there are special circumstances warranting an award of costs. 9. Section 60(3) sets out a non-exclusionary list of factors to which an Appeal Panel may have regard in determining whether special circumstances warranting an award of costs exist. 10. 'Special circumstances' are circumstances that are out of the ordinary, but need not be those which are exceptional or extraordinary: Cripps v G & M Dawson Pty Ltd [2006] NSWCA 81 at [60] (Santow J); Megerditchian v Kurmond Homes Pty Ltd [2014] NSWCATAP 120 at [11]; CPD Holdings Pty Ltd t/as The Bathroom Exchange v Baguley [2015] NSWCATAP 21 at [32]; Commissioner for Fair Trading v Edward Lees Imports Pty Ltd (No 2) [2019] NSWCATAP 222 at [8]; Edwards v Commissioner for Fair Trading, Department of Customer Service (Costs) [2019] NSWCATAP 249 at [9]; Youssef v NSW Legal Services Commissioner (Costs) [2020] NSWCATOD 115 at [107]. 11. However, it does not follow that a costs order should be made simply because one or more of the factors in s 60(3) are made out. 12. Even if satisfied that there are special circumstances, the Appeal Panel must further be satisfied that they are circumstances 'warranting an award of costs' - Fitzpatrick Investments Pty Ltd v Chief Commissioner of State Revenue [2015] NSWCATAD 103 at [21]; Youssef at [108]. 13. The exercise of the discretion requires the Tribunal 'to weigh whether those circumstances are sufficient to amount to 'special' circumstances that justify departing from the general rule that each party bear their own costs': BPU v New South Wales Trustee and Guardian (Costs) [2016] NSWCATAP 87 at [9]; Obieta v Australian College of Professionals Pty Ltd (2014) NSWCATAP 38 at [81]; Khalaf v Commissioner of Police [2019] NSWCATOD 178 at [29]; Alliance Motor Auctions Pty Ltd v Saman [2018] NSWCATAP 137 at [35]. 14. The person who asserts must prove, and so the party seeking the costs order bears the onus of proving that special circumstances exist - Styles v Wollondilly Shire Council [2017] NSWCATAP 108 at [5] under the heading 'Costs'. 15. Whether special circumstances exist is a question of fact and each case must be assessed according to its circumstances: Wynne Avenue Property Ltd v MJHQ Pty Ltd (No 2) [2019] NSWCATAP 68 at [57]; The Owners - Strata Plan 20211 v Rosenthal [2019] NSWCATAP 49 at [15]."
The conduct of the parties prior to the proceedings being commenced by the applicant is of little relevance in determining whether there are special circumstances that warrant a cost order being made in favour of the applicant.
The procedural history of the matter in the Tribunal is not sufficiently unusual or lengthy by reasons of the actions of the respondents that "special circumstances" are established. The proceedings were filed by the applicant on 3 March 2022. The matter was first listed on 23 March 2022. The matter was adjourned on that day with directions made for the filing and serving of documents. On 24 March 2022 the respondent sought an extension of time to comply with directions of the Tribunal. The applicant consented to the extension of time being granted. A four-day extension of time was granted to the respondent to comply with directions. On 5 April 2022 notices of hearing were sent to the parties advising them of the hearing date on 26 May 2022. On 7 April 2022 leave was granted to the applicant to join the occupants of the lot as respondents to the proceedings. The matter was heard and finalised on 26 May 2022. The Tribunal is not satisfied that any actions taken by the respondents in the proceedings have resulted in unnecessarily disadvantaging the applicant or that the proceedings have been prolonged due to the actions of the respondents.
The Tribunal accepts that the respondents had a number of opportunities prior to the proceedings commencing to agreeing to providing access, however, there is nothing special about bringing an application to the Tribunal due to a party not providing access to the lot. The Tribunal also accepts that the respondent could have consented during the proceedings to provide access, however, there is nothing out of the ordinary for there to be a dispute about access to a person's lot and for the matter needing to be resolved through litigation.
There are no other matters that the Tribunal regards as constituting "special circumstances" under s 60 (2) of the NCAT Act, taking into consideration the relevant matters set out in s 60 (3) of the NCAT Act.

The Owners - Strata Plan No 31284 v Mustafa, Young and Gallo

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Judgment (6 paragraphs)

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