[2025] NSWCATAP 92
General information, not legal advice.
NCAT Appeal Panel
2025-04-29
G Blake AM SC, Principal MemberD Goldstein, Senior Member
Original judgment source is linked above.
"(4) The respondent is to pay one quarter of the costs of the appellant of the appeal on the ordinary basis."
"The Appellant is to pay three quarters of the of the Respondent's costs of the appeal on the ordinary basis,
Or in the alternative,
Each party to pay their own costs."
"(2) The applicant is to pay 80% of the respondent's costs, on the ordinary basis, as agreed or as assessed if no such agreement can be reached."
"(2) The applicant is to pay 60% of the respondent's costs, on the ordinary basis, as agreed or as assessed if no such agreement can be reached."
(1) its submissions on the costs of the proceedings at first instance as part of the WHD costs application (the WHD costs submissions);
(2) the affidavit of David Edward Edwards (Mr Edwards) affirmed on 9 April 2025 (the Edwards affidavit).
(1) whether a hearing of the OSP70276 costs application should be dispensed with;
(2) whether the appeal costs order should be varied;
(3) whether the first instance costs order should be varied.
3 Objects of Act
The objects of this Act are -
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(d) to enable the Tribunal to resolve the real issues in proceedings justly, quickly, cheaply and with as little formality as possible, and
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4 Definitions
(1) In this Act -
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ancillary decision of the Tribunal means a decision made by the Tribunal under legislation (other than an interlocutory decision of the Tribunal) that is preliminary to, or consequential on, a decision determining proceedings, including -
(a) a decision concerning whether the Tribunal has jurisdiction to deal with a matter, and
(b) a decision concerning the awarding of costs in proceedings.
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decision - see section 5.
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internal appeal, internal appeal jurisdiction and internally appealable decision - see section 32.
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5 Meaning of "decision"
(1) In this Act, decision includes any of the following -
(a) making, suspending, revoking or refusing to make an order or determination,
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32 Internal appeal jurisdiction of Tribunal
(1) The Tribunal has internal appeal jurisdiction over -
(a) any decision made by the Tribunal in proceedings for a general decision or administrative review decision, and
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(4) An internally appealable decision is a decision of the Tribunal or a registrar over which the Tribunal has internal appeal jurisdiction.
(5) An internal appeal is an appeal to the Tribunal against an internally appealable decision.
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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.
38 Procedure of Tribunal generally
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(4) The Tribunal is to act with as little formality as the circumstances of the case permit and according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms.
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60 Costs
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(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.
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.
80 Making of internal appeals
(1) An appeal against an internally appealable decision may be made to an Appeal Panel by a party to the proceedings in which the decision is made.
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(2) Any internal appeal may be made -
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(b) in the case of any other kind of decision (including an ancillary decision) of the Tribunal at first instance - as of right on any question of law, or with the leave of the Appeal Panel, on any other grounds.
81 Determination of internal appeals
(1) In determining an internal appeal, the Appeal Panel may make such orders as it considers appropriate in light of its decision on the appeal, including (but not limited to) orders that provide for any one or more of the following -
(a) the appeal to be allowed or dismissed,
(b) the decision under appeal to be confirmed, affirmed or varied,
(c) the decision under appeal to be quashed or set aside,
(d) the decision under appeal to be quashed or set aside and for another decision to be substituted for it,
(e) the whole or any part of the case to be reconsidered by the Tribunal, either with or without further evidence, in accordance with the directions of the Appeal Panel.
(2) The Appeal Panel may exercise all the functions that are conferred or imposed by this Act or other legislation on the Tribunal at first instance when confirming, affirming or varying, or making a decision in substitution for, the decision under appeal and may exercise such functions on grounds other than those relied upon at first instance.
Whether a hearing of the OSP70276 costs application should be dispensed with
Whether the appeal costs order should be varied
(1) the OSP70276 costs application is for the Appeal Panel to exercise the discretion afresh under r 38A(2) of the NCAT Rules;
(2) it refers to the principle in Doppstadt Australia Pty Ltd v Lovick & Son Developments Pty Ltd (No 2) [2014] NSWCA 219 (Doppstadt (No 2)) at [17] (Ward, Emmett and Gleeson JJA):
"The usual circumstance in which a court will deprive the successful party of the costs relating to an issue on which the successful party lost is when that issue is clearly dominant or separable: Monie v Commonwealth of Australia (No 2) [2008] NSWCA 15 at [64] (Campbell JA). See also Waters v PC Henderson (Australia) Pty Ltd [1994] NSWCA 338; 254 ALR 328 at 330-33 1 (Mahoney JA)."
(3) in re-exercising the costs discretion, the Appeal Panel should give weight to the following circumstances:
(a) given "the weight of the outcome of the decision", it was the successful party;
(b) the second ground of appeal, on which WHD was successful, was not "clearly dominant" in the proceedings as a whole, nor in terms of complexity or time taken in argument;
(c) in terms of quantum, it was also not dominant (as set out in WHD's schedule of damages at first instance which references the AD & B scope of works as $91,805.00 exclusive of GST, and the loss of rent as at 9 September 2023 as $374,324.25 exclusive of GST. The cost of the basement works claimed in ground 4 of the appeal was not quantified, but those works were much more substantial than the works to which the second ground relates and so would have been substantially more costly;
(d) it was but one of four issues and it was wholly successful on the other three issues,
(e) had the appeal been formulated only on the one issue on which WHD was successful it may be inferred that the matter might have resolved without the need for any hearing;
(4) as it succeeded on three of the four grounds of appeal this is "the dominant outcome" and should be reflected in the costs order as sought in the first alternative order in the OSP70276 costs application;
(5) otherwise, the view could be taken that both parties have had some success in the appeal and each party should pay their own costs.
(1) the appeal costs order was appropriate in circumstances in which:
(a) the subject matter of the appeal was four separate and discrete claims for relief. The designations "grounds" or "issues" does not fully capture the fact that each related to a quite distinct claim before the Tribunal below and a quite distinct appellate challenge to the Tribunal's decision on each claim;
(b) the appeal was successful in relation to one of these discrete claims for relief;
(c) the grounds upon which the three other claims were dismissed and, more generally, the respondent's conduct of the appeal militated against the Appeal Panel awarding OSP70276 costs in relation to those claims;
(2) there is no reason to deny it a costs order in respect of appeal ground 2 upon which it succeeded. The Appeal Panel would only do so if it rejected the analysis of the appeal as one involving discrete, separable issues;
(3) as to the other three grounds, the Appeal Panel's exercise of its discretion would be informed by the following matters:
(a) it established errors of law on the Tribunal's part in relation to grounds one and four but the challenges ultimately failed for reasons identified by the Appeal Panel without apparent assistance from OSP70276's submissions;
(b) much of the hearing time was taken up with OSP70276's unsuccessful challenges to its grounds on the basis that they were not on questions of law;
(c) OSP70276's challenges in this regard were not only prolix and time consuming but were raised belatedly at the hearing itself in breach of procedural directions and necessitating it to incur the additional expense of preparing supplementary submissions in reply;
(4) the appeal costs order should not be disturbed in the light of these matters and the New South Wales Court of Appeal's emphasis on impression and evaluation in outcomes involving mixed success: Bostik Australia Pty Ltd v Liddiard (No 2) [2009] NSWCA 304 (Bostik) at [38] (Beazley, Ipp and Basten JJA).
(1) "the weight of the outcome of the decision" and "the dominant outcome" on the appeal did not favour OSP70276. As indicated in the appeal decision at [158], there were four separable issues which should be considered separately when determining the costs of the appeal;
(2) the quantum of WHD's claim was not a relevant factor in the determination of the appeal which involved the consideration of four questions of law;
(3) the success of OSP70276 on three of the four contested questions of law was reflected in the appeal costs order whereby we decided that OSP70276 should pay one quarter of WHD's costs of the appeal;
(4) it is not relevant to speculate on an appeal which only involved the issue on which WHD was successful.
Whether the first instance costs order should be varied
(1) whether the WHD costs application should be determined;
(2) if so, whether the first instance costs order should be varied.
(1) the 11 November 2024 decision ([2]) in which the Tribunal relevantly made the following findings:
(a) there were six issues which were separable except for a link between two issues, WHD was successful in respect of two issues and unsuccessful in respect of four issues. One of the unsuccessful issues involved three claims: first, a claim for loss of rent of $11,667.67 per month from 8 January 2021 to the date of the hearing, which was more than $400,000; secondly, a claim for $91,805, or alternatively a work order, for property damage; thirdly, a further claim for loss of rent of $11,667.67 per month from the date of the orders until completion of work on the roof and skylight ([29]-[30);
(b) the monetary claim was the primary aspect of the proceedings, involving claims for $500,000 or more. OSP70276 was successful in the proceedings in respect of all but two issues ([31]-[32]);
(c) a discount of 20% should be applied so that OSP70276 would not be overcompensated. In assessing that discount it had regard to the extent to the successful issues, compared to the unsuccessful issues, required evidence and submissions, both written and oral; the entire proceedings and not just the hearing, since it was considering the costs of the proceedings and not the just the costs of the hearing; and the effect of s 104 of the SSM Act ([33]-[37]);
(2) his letter dated 12 November 2024 to the solicitors of OSP70276 (the 12 November 2024 DEA letter) which relevantly provided:
"We also put you on notice that we intend to argue at the hearing of the appeal that the costs order made by the Tribunal yesterday should be set aside and an order made in lieu thereof by the Appeal Panel. The submissions on what form that order will take will depend upon the Appeal Panel's decision and should be addressed at that time."
(1) the WHD costs application goes well beyond the leave granted by order (5) of the appeal decision;
(2) for the Appeal Panel to vary the first instance costs order, WHD would first need to make a successful application to reopen the appeal. No such application has been made let alone granted;
(3) leave to reopen any matter after judgment has been delivered would require WHD to establish extraordinary circumstances which do not exist here and any application for leave to reopen the appeal case would be vigorously opposed;
(4) WHD did not lodge an amended notice of appeal it which it seeks a variation of the first instance costs order;
(5) WHD in neither the appeal book nor its written or oral submissions referred to the 11 November 2024 decision or an application to vary the first instance costs order;
(6) WHD did not make any submission seeking a variation of the first instance costs order on the hearing of the appeal as foreshadowed in the 12 November 2024 DEA letter.
(1) OSP70276 in the OSP70276 costs submissions takes a technical point that the effect of orders 4 and 5 of the appeal decision was to permit further submissions on the costs of the appeal only and not on the costs orders made below;
(2) costs orders, both at first instance and on appeal, depend upon and await the substantive decisions. This fundamental fact is reflected in their designation as "ancillary orders" under the definition in s 4(1) of the NCAT Act;
(3) in s 60 of the NCAT Act (unaffected in this regard by r 38A of the NCAT Rules), the source of the Appeal Panel's discretionary powers in relation to costs, the expression "costs" is defined in subs 5(b) to include the costs of, or incidental to, the proceedings giving rise to the appeal, as well as the costs of or incidental to the appeal itself;
(4) having regard to these matters there is no inconsistency with orders 4 and 5 of the appeal decision in it seeking variation of the costs orders below in conformity with the Appeal Panel's variation of the substantive orders. This is notwithstanding the absence of any expressly pleaded claim for relief in respect of the costs of the proceedings below;
(5) it would be quite contrary to the interests of justice if it were not permitted to agitate for variation of the costs orders below, and contrary to the statutory injunction upon the Tribunal under s 36 of the NCAT Act to facilitate, among other things, the just resolution of the proceedings;
(6) it would also represent a triumph of form over substance in a forum which is expressly subject to statutory injunctions against allowing this to happen. Section 1(d) of the NCAT Act sets out the Act's purpose of, among other things, enabling the Tribunal to resolve the real issues in proceedings justly, quickly, cheaply and with as little formality as possible. Section 38(4) mandates that the Tribunal act with as little formality as the circumstances of the case permit and according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms;
(7) in terms of prejudice to OSP70276 there can be none in circumstances in which it put OSP70276 on notice of its intention to contest the costs orders below in the 12 November 2024 DEA letter.
Whether the WHD costs application should be determined
"[160] In the absence of any indication in the Tribunal Act that the Appeal Panel is not able to reopen a decision once pronounced, there will be circumstances in which it may do so and, indeed, circumstances where it should do so. Such a power will fall within the breadth of the procedural powers conferred on it under s 38. Where the Tribunal is satisfied that it has failed to address one of the real issues in the proceedings before it, it may (and perhaps should) reopen the proceedings in order to give effect to the guiding principle set out in s 36 of the Tribunal Act."
(1) noted that on 19 December 2023, after the appeals were commenced, the Tribunal made a cost decision that the homeowner pay the builder's costs of the proceedings at first instance (the costs decision) ([3]);
(2) noted that it sought submissions from the parties as to whether it could consider the costs of the original proceedings without the notice of appeal being amended to include an appeal against the costs decision ([7]);
(3) after setting out the submissions of the parties made a finding that it had power to consider the costs of the original proceedings without the notice of appeal being amended ([17]-[18]) including:
"[17] We have concluded that we have the power to reconsider the costs decision (and if necessary, to set it aside) in circumstances where the decision itself is not challenged, but where its outcome has potentially been undermined by a decision on appeal altering the basis on which the costs decision was made. This is what the homeowner contends is the case. That power is to be found in s 81. The power has to be exercised in a procedurally fair manner, which we have endeavoured to do here. The need for the costs decision to be reconsidered only arose after the result of the appeal was known (and the final outcome's interaction with settlement offers became obvious). This points to utility of the Appeal Panel reconsidering the costs decision, without a formal amendment, as a means of facilitating the just, quick and cheap resolution of the real issues in the proceedings."
(1) the powers conferred on the Appeal Panel in s 81 of the NCAT Act may be exercised "(i)n determining an internal appeal". In the light of the definitions of "internal appeal", "internal appeal jurisdiction" and "internally appealable decision" in ss 4(1) and 32(1), (4) and (5) when read with the definition of "decision" in ss 4(1) and 5, these powers are limited to the particular decision which is the subject of the appeal;
(2) section 81(1)(b), (c) and (d) by their terms only permit the varying, quashing, setting aside, or quashing or setting aside and substituting another decision for "the decision under appeal";
(3) the costs decision is an "ancillary decision" within para (b) of the definition of this expression in s (4) when read with the meaning of "decision" in s 5(1)(a) of the NCAT Act. As such, a separate internal appeal against it may be made pursuant to s 80(1) and (2)(b). Unless an internal appeal is made against it, the powers in s 81 cannot be exercised in relation to the decision.
(1) section 3(d) is one of the objects of the NCAT Act, and does not confer any power on the Tribunal;
(2) while it is necessary pursuant to s 36(2)(b) to seek to give effect to the guiding principle in s 36(1) in interpreting s 81, it does not support the existence of a power to make orders in respect of a decision which is not under appeal;
(3) the stipulation in s 38(4) as to the procedure of the Tribunal does not address the existence of the powers of the Tribunal;
(4) while we accept that s 60(4) when read with para (b) of the definition of "costs" in s 60(5) enables the Tribunal to determine the costs in proceedings giving rise to an appeal, this provision does not confer any power on the Appeal Panel to set aside a costs decision which is not the subject of the appeal.
If so, whether the first instance costs order should be varied
(1) A hearing of the application of the respondent to vary order (4) made on 2 April 2025 is dispensed with.
(2) The application of the respondent to vary order (4) made on 2 April 2025 is dismissed and the respondent is to pay the appellant's costs of the application.
(3) The application of the appellant to reopen the appeal is dismissed and the appellant is to pay the respondent's costs of the application.
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.
White House Developments Pty Ltd
The Owners - Strata Plan No 70276