THE OWNERS - UNIT PLAN NO 1565 v RUFF [2018] ACAT 31 | Case summary

The applicant noted that paralegal staff, amongst others, undertook significant work for which no payment was sought.
Taking into account the guiding principles outlined in Black, the Tribunal accepts that it was reasonable for the corporation to:
- (a) engage an agent to make investigations to take steps to recover the debt; and
- (b) issue proceedings.
The next question is whether the amount of the expenses was reasonable. Three items stand out.
The applicant's agent sent a second and third arrears letter, charged at $110.00 each. Based on the information before the Tribunal, that amount appears to be double the amount typically charged for a first arrears letter. The applicants sought to explain the increase by reference to the 'additional work' and fact checking associated with a second arrears letter. We accept this to a point - although generally a form letter, the arrears letter still needs to be customised and debts calculated and confirmed. Still, the Tribunal had little evidence before it that demonstrates that it is reasonable to increase the charge for a second or third arrears letter to the significant amount argued for in this case. In short, the Tribunal does not consider the extra work sufficiently onerous so as to justify doubling the amount charged. Each arrears letter will be allowed at $55.00.
The second issue is an additional fixed charge of $500.00 for the commencement of legal action. We understand that this is a fee charged by the management company once a matter is referred to an agent for legal or collection action. The evidence does not disclose how the amount is arrived at, for example hourly rate or some other calculation. What the evidence does show is that much of the work charged for involves requesting updates, receiving updates and reporting back to the unit corporation to obtain instructions and then convey those instructions. This kind of work is not onerous and the Tribunal considers the charge of $500.00 is not reasonable. The Tribunal would allow an amount of $250.00.

THE OWNERS - UNIT PLAN NO 1565 v RUFF

At a glance

Court

Decision date

Source

Judgment (1 paragraphs)

Parties

Legislation Cited (2)

Cases Cited (2)

THE OWNERS - UNIT PLAN NO 1565 v RUFF (Civil Dispute) [2018] ACAT 31 (20 March 2018)