The Owners - Strata Plan No 70871 v Turek

The circumstances which apply to these appeal proceedings

1. In order to determine whether circumstances are special for the purpose of section 60 of the CAT Act, it is first necessary to identify them. In order to consider this issue and to deal with the submissions of the parties we deal with a number of matters.

The Notice of Appeal

1. The first matter is the form of the Notice of Appeal itself. In written submissions the respondents said that the Notice of Appeal did not identify any grounds upon which leave to appeal might be granted and any grounds of appeal.
2. In our appeal decision we made the following observations; 14 The appellant filed a Notice of Appeal on 28 November 2019. It was prepared by its solicitor, Mr Joseph Bannerman. The form of Notice of Appeal utilised by this Tribunal is a standard form. It requires the appellant to specify a number of matters. Significantly for our purposes these include; the orders challenged on appeal, the grounds of appeal, the orders that should be made on appeal, and in connection with the seeking of leave to appeal, the reasons why the decision from which the appeal is brought was not fair and equitable, that significant new evidence was now available that was not reasonably available at the time of the hearing, and why that evidence was not so available. Each of these matters were referred to in the Notice of Appeal by use of the words "Please see attached submissions." There was annexed to the Notice of Appeal a document entitled "Respondent's Submissions" consisting of 4 closely typed pages and to which were attached seven documents with a total length of 45 pages. The attachments included 32 pages of transcript of two sets of proceedings, correspondence between Mr Bannerman and the Registrar of this Tribunal, and copies of a number of orders made by the Tribunal. 15 It is not necessary that we analyse the documentation furnished by the appellant's solicitor in any detail. It is sufficient to state that the written submissions do not assist the Appeal Panel in any meaningful manner in discerning what are the grounds of appeal, as well as the matters relating to the leave issue. Although the written submissions do set out the orders that are sought on appeal, the discursus on why the decision the subject of the appeal was not fair and equitable consists of a rambling narrative, and an attempt to identify significant new evidence is misplaced. 16 We add for completeness that in written submissions counsel for the respondent encountered the same difficulty that confronted us in endeavouring to comprehend what were the grounds of appeal being advanced by the appellant. 17 At the commencement of the hearing we suggested to Mr Bannerman that our understanding of the basis for the appeal, as best we could comprehend it, was an argument based upon the construction of section 131 of the SSM Act, namely that the owners corporation could not be said to have refused to grant a licence to use the common property because no license agreement had been submitted to it by the respondents or their tenant. Mr Bannerman embraced this as encapsulating the substantial ground of appeal.
3. It follows that we accept these submissions of the respondents.
4. In its written submissions the appellant said that "The grounds of appeal were clearly explained to the Appeal Panel during call over hearing, the stay hearing and the final hearing…. Furthermore, the grounds of appeal were explained to Appeal Panel during the hearing and the Appeal Panel was fully aware of the grounds of appeal.
5. The reference to the stay hearing is a reference to an application to stay the decision of the Senior Member prior to the hearing of the appeal. That matter came on for hearing before Principal Member Suthers. The application for a stay was refused. Principal Member Suthers then dealt with an application by the respondents for a costs order in their favour, which was dismissed. The proceedings are The Owners - Strata Plan No 70871 v Turek [2020] NSWCATAP 29. In the course of his reasons for decision Principal Member Suthers said at [6] On 10 December 2019, I refused an application for a stay of the order. In doing so, I made the following relevant findings: (1) At [5] that: "...the appellant's Notice of Appeal lacked particularity in identifying the errors alleged to have been made by the Tribunal below. However, I was informed that it had asked for reasons for the decision from the Tribunal, which have not yet been received. Unfortunately, the appellant indicates that the reasons were requested more than 28 days ago and that the Tribunal has not complied with its obligation under s 62(2) of the Civil and Administrative Tribunal Act 2013 (NSW) ("the NCAT Act"). Whilst I do not need to deal in this application with the appellant's argument that this, in itself, means that the Tribunal has failed to provide adequate reasons and thereby that an error on a question of law is established, I do accept that the lack of particularity in the Notice of Appeal should not weigh against the appellant in those circumstances.";
6. There can be no doubt that as at 10 December, 2019 the solicitor for the appellant, Mr Bannerman was aware that there were deficiencies in the Notice of Appeal which he had filed. Notwithstanding that he may not have received the reasons for decision at the date that he filed the Notice of Appeal, it is clear that he had received them well before the appeal matter came on for hearing before us on 6 February 2020.
7. In its written submissions the appellant also said that the grounds of appeal were set out in the submissions and evidence filed in accordance with the directions of the Appeal Panel. We refer to the material extracted from the appeal decision in [15] above. We reject any suggestion that the grounds of appeal were set out in the submissions and evidence in any intelligible manner.
8. Furthermore, we reject the appellant's submission that the grounds of appeal were explained by Mr Bannerman to us at the appeal hearing in a manner which enabled us to understand them. As set out in the extract from the appeal decision above, at the appeal hearing we endeavoured to discern the subject matter of the appeal and the grounds of appeal in dialogue with Mr Bannerman. He eventually informed us that he agreed that the manner in which we had formulated the one substantial ground of appeal was the ground upon which his client relied.
9. Many litigants who come before this Tribunal are self represented with little or no legal knowledge. They are encouraged to formulate grounds of appeal by reference to the matters to which their attention is directed when completing the form of Notice of Appeal. In these proceedings the appellant was represented by a solicitor, Mr J Bannerman. It might be expected that a solicitor would be able to draft a Notice of Appeal complying with the requirements of the Tribunal, which in turn reflect the requirements of the CAT Act. The failure of an appellant to formulate appropriate grounds to justify the grant of leave to appeal and the failure to formulate grounds of appeal is a serious matter. Such failure severely impedes the ability of a respondent to understand and prepare for the appeal proceedings, and creates difficulties for the Tribunal in managing the appeal proceedings. Such a failure is compounded where it is caused by a solicitor. We shall refer to this matter further when considering whether to make a costs order as sought by the respondents.

The new evidence application

1. The next matter for consideration is the application made by the appellant to adduce new evidence in the appeal proceedings. The decision under appeal was concerned with the granting of an application for adjournment and the making of orders in the nature of case management orders directed towards the preparation of the proceedings for hearing. The new evidence which the appellant said it wished to introduce was described as "significant new evidence" and was intended to rebut any suggestion that the appellant had consented to the adjournment of the proceedings before the Senior Member and the making of consequential orders.
2. In the appeal decision we said at [33] and following 33 Before us the appellant submitted that it had objected to the adjournment and had then objected to orders made by the Tribunal that the respondents were to provide a draft license agreement and that the appellant was required to arrange an EGM to consider the terms of that license. Mr Bannerman said that he had objected to these subsequent orders. He cited an extract from the transcript of evidence in which he said to the Senior Member I have to take instructions from my client. I can't say if my client is going to even agree to convene a meeting to consider it. They don't have to, but I would encourage them to. 34 This was said to constitute the "new evidence" upon which Mr Bannerman sought to rely for the purpose of this appeal. 35 In citing to us this extract, Mr Bannerman failed to include reference to the following material which is extracted in the submissions of the respondents and which follows immediately after the above passage; Member: Then we will order one Mr Bannerman: Okay, okay but I mean... Member: Your client can't refuse everything Mr Bannerman: Yes, okay. Fine. But... Member: Then no point in having me here Mr Bannerman: Okay, understood. But, but yeah, I mean, well, we can set a timetable, um and we can convene a meeting, it takes about three weeks or so Member: And, and then you can ask for an extension. I'm not saying you have to do anything, but something will have to be done Member: I, I haven't heard yet that we won't call a meeting to consider it. Then the licence will come to me. Mr Bannerman: Yep Member: Okay, so if you say you need two weeks, what would you need, four? That would be six weeks Mr Bannerman: Oh, I'd probably need 5, because we need to convene the general meeting and then prepare our evidence after that. 36 Shortly after, the following exchange occurred; Member: You're fine with that? So direction I am making to you is, the Respondent, is to call, arrange and EGM and, ah, what would you do, you will decide whether to approve or not to approve the draft license Mr Bannerman: Yes, yes Member: Or amendments or whatever Mr Bannerman: Sure 37 Following this further exchange, the Member fixed 17 January 2020 as the date on which the EGM would be held and asked Mr Bannerman whether that date was acceptable, and he replied in the affirmative. 38 When the above extracts were drawn to our attention by counsel for the respondents, we questioned Mr Bannerman why he had asserted that his client had not consented to the making of the two subsequent orders. After discussion he reluctantly indicated to us that he had "acquiesced" in the making of these orders. 39 It follows from the material referred to above that in submitting to us that there was a lack of consent by his client to the making of orders requiring the submission of a licence agreement and the holding of an EGM to consider it that Mr Bannerman was acting in a disingenuous manner. A legal practitioner appearing before this Tribunal must conduct himself or herself in a manner which is consistent with an appropriate degree of candour and accuracy. 40 To the extent that Mr Bannerman sought to set aside the making of those orders for the purpose of these appeal proceedings, in circumstances where he informed the Member that his client acquiesced in the making of those orders, which we understand as best we can to be the basis for such a submission, that submission must be rejected.
3. We regard any circumstances in which a party to proceedings before this Tribunal, including an appellant in appeal proceedings acts in a disingenuous manner as something which could not be described as "ordinary" and which must be characterised as "extraordinary." This is more so when the party is represented by a solicitor. The application to adduce new evidence was misconceived and had no proper basis. The respondent was required to address that point and we were required to consider it. A disingenuous point does not have the same character as an appeal point about which an argument can be put, although ultimately to be found lacking in legal merit. The making of a disingenuous point arguably detracts from the ability of this Tribunal to "facilitate the just, quick and cheap resolution of the real issues in the proceedings" as required by section 36 of the CAT Act; 36 Guiding principle to be applied to practice and procedure (1) The guiding principle for this Act and the procedural rules, in their application to proceedings in the Tribunal, is to facilitate the just, quick and cheap resolution of the real issues in the proceedings. (2) The Tribunal must seek to give effect to the guiding principle when it - (a) exercises any power given to it by this Act or the procedural rules, or (b) interprets any provision of this Act or the procedural rules. (3) Each of the following persons is under a duty to co-operate with the Tribunal to give effect to the guiding principle and, for that purpose, to participate in the processes of the Tribunal and to comply with directions and orders of the Tribunal - (a) a party to proceedings in the Tribunal, (b) an Australian legal practitioner or other person who is representing a party in proceedings in the Tribunal. (4) In addition, the practice and procedure of the Tribunal should be implemented so as to facilitate the resolution of the issues between the parties in such a way that the cost to the parties and the Tribunal is proportionate to the importance and complexity of the subject-matter of the proceedings. (5) However, nothing in this section requires or permits the Tribunal to exercise any functions that are conferred or imposed on it under enabling legislation in a manner that is inconsistent with the objects or principles for which that legislation provides in relation to the exercise of those functions.
4. Arguably, Mr Bannerman has also failed in his duty to this Tribunal as required by section 36 (3) (b) above.

The motive for the appeal

1. The respondents submitted that the motivation for the appeal was the desire to "shut down, on a preliminary basis", the respondents' application for the granting of a licence to store their garbage bins. In aid of this submission the respondents relied on an assertion that the appellant would never consent to the respondents' tenant storing their waste bins on common property, and that the arguments relied upon by the appellant in the appeal proceedings concerning the necessity for written license agreements constituted in effect a smoke screen for the real issue.
2. Whilst there is truth in the underlying argument of the respondents that there was no merit in the appellant's appeal, there is insufficient evidence to allow us to conclude that was the real motivation of the appellant in instituting the appeal constituted, in effect, a subterfuge designed to frustrate the respondents' position. We reject the respondents' submission that the motivation of the appellant for the institution of the appeal is a circumstance which would justify making an adverse costs order.

The merits of the appeal

1. Without traversing in any detail the reasons why the appellant's appeal failed, the details of which are set out in our appeal decision, we observe that in essence the appellant failed to appreciate that the decision from which the appeal was brought concerned interlocutory proceedings, and that the decision itself was part of the case management of the proceedings by the Tribunal. In addition, the appellant's submissions concerning the operation of section 131 of the Strata Schemes Management Act 2015 were misconceived, for reasons which are set out in the appeal decision.
2. The appeal clearly lacked merit. However, this in itself is not necessarily a circumstance which would render the proceedings out of the ordinary if it were not for two additional bases upon which the appellant proceeded.
3. Although not specified as a ground of appeal (because no grounds of appeal were specified), it emerged during the course of the submissions made by Mr Bannerman on behalf of the appellant that he was arguing that the proceedings from which the appeal was brought should have been summarily dismissed because they were doomed to fail and that there was no basis upon which the respondents could succeed. In dealing with this submission we observed at [26] Mr Bannerman submitted the application should be summarily dismissed. In so submitting, he did not engage in any attempt to analyse and discuss the provisions of section 131 of the SSM Act, nor did he deign to discuss the relevant principles which apply to a consideration of the summary dismissal of proceedings. During the course of the hearing we raised with Mr Bannerman principles espoused in well-known decisions such as General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69 in the High Court of Australia.
4. After discussing the provisions of section 131 and the decision in General Steel we said at [31]; It is clear that there is simply no basis upon which it could be asserted that the application brought by the respondents was doomed to fail within the General Steel principles. No consideration could be given to such an application unless the respondents had been given an opportunity of furnishing to the Tribunal all of the information upon which they wished to rely in support. That occasion had not then arisen.
5. We accordingly dismissed the appellant's argument on this point.
6. Finally, Mr Bannerman submitted that the underlying proceedings which were the subject of the appeal should have been dismissed under section 55 of the CAT Act. We dealt with that submission as follows; 42 In support of this submission Mr Bannerman's written submissions asserted that the proceedings were "frivolous or vexatious or otherwise misconceived or lacking in substance and/or there has been a want of prosecution of the proceedings." In no manner did Mr Bannerman attempt in his written submissions to describe why the proceedings should be characterised by any of these descriptions contained in section 55. He did not describe why they might be characterised as frivolous or vexatious, and as we have previously discussed, he did not deign to describe why he thought that they might be lacking in substance or "otherwise misconceived." Of course, there is material contained in his narration that does assert a lack of prosecution on the part of the respondents. But apart from this particular matter, the overall submissions of Mr Bannerman dealing with the provisions of section 55 are unhelpful. 43 We cannot find any basis for the application of section 55 of the CAT Act as asserted by the appellant. This submission is rejected.

Consideration

1. In determining whether special circumstances exist which would justify the making of an adverse costs order we take into account a number of matters.
2. In filing a Notice of Appeal which was fundamentally defective, and in failing otherwise to specify the grounds of appeal the respondents were unnecessarily disadvantaged in the preparation of their resistance to the appeal. In addition, these deficiencies also inhibited this Tribunal in dealing with the appeal proceedings in a timely fashion. Furthermore, in so doing Mr Bannerman and his client breached the provisions of section 36 (3) of the CAT Act. It follows that the provisions of section 60(3)(a), (b) and (f) have been satisfied, and these circumstances justify the making of an adverse costs order.
3. In addition, the proceedings were unnecessarily complicated and the hearing unnecessarily prolonged because of the submissions made by Mr Bannerman dealing with the "new evidence" application, the "summary dismissal" point and the section 55 application. None of these matters had any merit. If the submissions had been made by a party without legal knowledge or unrepresented, we may have arguably considered them in a different light when determining whether or not the mere fact that they were made would constitute special circumstances. However, the submissions were made by a solicitor. For the reasons which we articulated in the appeal decision and which we have summarised above, they were misconceived and without merit. As such, they also justify a conclusion that special circumstances exist which justify the making of an adverse costs order by applying section 60(3)(c) and (e).
4. For all these reasons we conclude that special circumstances apply to the appeal proceedings as provided for in section 60 of the CAT Act. Costs should follow the event and the appellant must pay the respondents' costs of the appeal. We propose to order accordingly.

Orders

1. Order that the appellant pay the costs of the respondents in an amount 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) in default of agreement.

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: 19 May 2020