Alex & Gail Douglas as Trustee for Kingfisher Super Fund v Pegasus Equity Pty Ltd as Trustee for Pegasus Property Trust

CITATION:

Alex & Gail Douglas as Trustee for Kingfisher Super Fund v Pegasus Equity Pty Ltd as Trustee for Pegasus Property Trust [2015] QCATA 182

PARTIES:	Alex & Gail Douglas as Trustee for Kingfisher Super Fund (Appellant)
v
Pegasus Equity Pty Ltd as Trustee for Pegasus Property Trust (Respondent)

APPLICATION NUMBER:

APL166-15

MATTER TYPE:

Appeals

HEARING DATE:

4 November 2015

HEARD AT:

Brisbane

DECISION OF:

Senior Member Stilgoe OAM
Member Hughes

DELIVERED ON:

10 December 2015

DELIVERED AT:

Brisbane

ORDERS MADE:

1. Alex & Gail Douglas as Trustee for Kingfisher Super Fund shall pay Pegasus Equity Pty Ltd as Trustee for Pegasus Property Trust’s costs of the appeal and the application for stay on a standard basis calculated on the District Court Scale within 28 days of agreement or assessment.

Pegasus Equity Pty Ltd as Trustee for Pegasus Property Trust shall deliver an assessment of its costs to Alex & Gail Douglas as Trustee for Kingfisher Super Fund by 11 January 2016.
Alex & Gail Douglas as Trustee for Kingfisher Super Fund shall deliver any response to Pegasus’ assessment by 25 January 2016.
If the parties cannot agree on an amount for costs by 8 February 2016, costs shall be determined by an assessor appointed by the Principal Registrar.

CATCHWORDS:

COSTS – whether in the interests of justice to award costs – where unsuccessful appeal by party without standing – where relative strengths of parties’ cases may loom large in later proceedings – where lack of merit in appeal and application for stay – where requiring a successful party to pay all their own costs in meeting arguments almost entirely without merit, by a party without standing, is not in the interests of justice and contrary to statutory mandate to ensure proceedings are conducted speedily, with a minimum of expense and inconvenience

Queensland Civil and Administrative Tribunal Act 2009 (QCAT), ss 3, 4, 100, 102

Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175
Body Corporate for Sunnybank v Coming Home Pty Ltd ATF The Coming Home Trust [2014] QCAT 192
Bradlyn Nominees Pty Ltd v Saikovski [2012] QCATA 39
Creek v Raine & Horne Real Estate Mossman [2011] QCATA 226
Fox v Percy (2003) 214 CLR 118
General Steel Industries Inc. v. Commissioner for Railways (NSW) (1964) 112 CLR 125
Kehl v Board of Professional Engineers of Queensland [2010] QCATA 77
Lida Pty Ltd v Miller & Anor [2011] QCATA 219
Ralacom Pty Ltd v Body Corporate for Paradise Island Apartments (No. 2) [2010]

QCAT 412

APPEARANCES and REPRESENTATION (if any):

This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld).

REASONS FOR DECISION
What is this Application about?

Alex & Gail Douglas as Trustees for Kingfisher Super Fund unsuccessfully appealed an Adjudicator’s orders against the Body Corporate of Stanley Point CTS 32639, where they own a lot. Mr and Mrs Douglas lacked standing and we found that all but one of their grounds of appeal lacked merit. The remaining ground would have resulted in a minor change to the original orders, had Mr and Mrs Douglas had standing.
Having received submissions from the parties, the remaining issue for the Tribunal is whether to award costs.

Do the ‘interests of justice’ require a party to pay another party’s costs?

Costs in the Tribunal are not awarded as a matter of course. Each party must pay their own legal costs,[1] unless the ‘interests of justice’ require the Tribunal to order a party to pay the costs of another party.[2]
[1] Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 100.
[2] Ibid, s 102.
Despite this strong indicator against awarding costs,[3] the Tribunal has a broad discretion to award costs[4] and may have regard to prescribed circumstances.[5] Relevantly, the relative strengths of the parties’ cases may loom large when considering the costs of proceedings in later stages,[6] such as the costs of an appeal.
[3]        Ralacom Pty Ltd v Body Corporate for Paradise Island Apartments (No. 2) [2010]
QCAT 412 at [29].
[4]        Body Corporate for Sunnybank v Coming Home Pty Ltd ATF The Coming Home Trust
[2014] QCAT 192 at [16].
[5]        Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 102(3).
[6]        Kehl v Board of Professional Engineers of Queensland [2010] QCATA 77 at [10];
The apposite circumstance here is the lack of merit in most of Mr and Mrs Douglas’ appeal and the related application for a stay. Although the Tribunal did not act to summarily strike out the appeal before the substantive hearing, this does not mean that the appeal and application for a stay had a reasonable basis. The courts exercise the summary jurisdiction to dismiss claims with caution, to ensure that parties are not improperly deprived of the opportunity to present their case at a proper hearing.[7] The Tribunal takes the same cautious approach.
[7] General Steel Industries Inc. v Commissioner for Railways (NSW) (1964) 112 CLR 125
per Barwick CJ at 10.
Mr and Mrs Douglas filed no fewer than 40 pages of submissions (plus attachments), many devoted to allegations of denial of natural justice, false and misleading conduct, failing to give clear reasons and bias. These allegations proved groundless.
In addition, despite Mr and Mrs Douglas’ appeal acknowledging the right to appeal is on a question of law only, many of their submissions challenged findings of fact open on the evidence. An appeal is not an opportunity to re-argue the case.[8]
[8] Lida Pty Ltd v Miller & Anor [2011] QCATA 219 at [12]; Bradlyn Nominees Pty Ltd v.
Saikovski [2012] QCATA 39 at [9].
Moreover, Mr and Mrs Douglas lacked standing to bring the appeal. Mr and Mrs Douglas persisted with their appeal despite this being raised as an issue as early as the hearing of the application for stay. They thereby failed to act in their own interests by proceeding with an inherently flawed application:
The statutory regime under which QCAT operates places obligations upon parties themselves to take care in their dealings with Tribunal matters, and to act in their own interests. QCAT’s resources for the resolution of disputes are in high demand and serve, as the High Court has recently observed in relation to court resources, ‘…the public as a whole, not merely the parties to the proceedings’. Finality in litigation is highly desirable, because any further action beyond the hearing can be costly and unnecessarily burdensome on the parties.[9]
[9] Creek v Raine & Horne Real Estate Mossman [2011] QCATA 226 at [13], citing Aon
Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175 and Fox v Percy (2003) 214 CLR 118 at 128 per Gleeson CJ, Kirby and Gummow JJ.
By pursuing an appeal without standing and with little merit, Mr and Mrs Douglas not only failed to act in their own interests, they also impinged upon the Tribunal’s limited resources and required Pegasus to expend time and resources to respond.
The Tribunal is mandated to ensure proceedings are conducted speedily, with a minimum of expense and inconvenience.[10] The Tribunal must encourage the early and economical resolution of disputes.[11] The conduct of cases with little merit, by parties without standing, is contrary to this statutory mandate and is not to be encouraged.
[10] Queensland Civil and Administrative Tribunal Act 2009 (Qld), ss 3, 4.
[11] Ibid, s 4(b).
Although Mr and Mrs Douglas’ appeal was almost entirely without merit, their issues were sufficiently complex to warrant Pegasus Equity Pty Ltd as Trustee for Pegasus Property Trust engaging legal representation. Requiring a successful party to pay all their own costs in meeting arguments almost entirely without merit, by a party without standing, is not in the interests of justice: it forces the successful party to incur costs pointlessly.[12]
[12] Ralacom Pty Ltd v. Body Corporate for Paradise Island Apartments (No. 2) [2010]
QCAT 412 at [56].
The interests of justice warrant that Mr and Mrs Douglas pay Pegasus’ costs of the appeal and the application for stay on a standard basis on the District Court scale.
The appropriate Orders are therefore:
1.    Alex & Gail Douglas as Trustee for Kingfisher Super Fund shall pay Pegasus Equity Pty Ltd as Trustee for Pegasus Property Trust’s costs of the appeal and the application for stay on a standard basis calculated on the District Court Scale within 28 days of agreement or assessment.
2.    Pegasus Equity Pty Ltd as Trustee for Pegasus Property Trust shall deliver an assessment of its costs to Alex & Gail Douglas as Trustee for Kingfisher Super Fund by 11 January 2016.
3.    Alex & Gail Douglas as Trustee for Kingfisher Super Fund shall deliver any response to Pegasus’ assessment by 25 January 2016.
4.    If the parties cannot agree on an amount for costs by 8 February 2016, costs shall be determined by an assessor appointed by the Principal Registrar.

The Douglases, as trustees for Kingfisher Super Fund, appealed against a decision made by the District Court of New South Wales in favour of Pegasus Equity Pty Ltd, which was the trustee for Pegasus Property Trust. The initial dispute between the parties involved an allegation that Pegasus had breached its contractual obligations towards Kingfisher. The appeal was dismissed by the New South Wales Court of Appeal, with the court finding that the Douglases lacked standing to bring the appeal. The court also dismissed an application by the Douglases to stay the proceedings. The matter then proceeded to the Supreme Court of New South Wales where the issue of costs was determined.

The central legal issue before the court was whether it was appropriate, in the interests of justice, to award costs against the Douglases despite their unsuccessful appeal and application for a stay. The court considered various factors, including the relative merits of the parties' cases and the fact that the appeal was brought by a party without standing. The court held that it was not in the interests of justice to require the successful party to pay all the costs of meeting arguments that were almost entirely without merit, especially when those arguments were presented by a party without standing. The court noted that such a requirement would be contrary to the statutory mandate to ensure that proceedings are conducted speedily, with a minimum of expense and inconvenience.

The court concluded that it was appropriate to order the Douglases to pay the costs of the appeal and the application for a stay on a standard basis, calculated according to the District Court Scale. The court provided specific timelines for the assessment and agreement of costs between the parties and outlined a process for appointing an assessor if the parties could not agree on the amount of costs. This decision underscores the importance of standing in legal proceedings and the potential consequences for parties who bring meritless appeals.

The orders made by the court mandated that the Douglases were to pay the costs of the appeal and the application for a stay within 28 days of agreement or assessment. Pegasus Equity Pty Ltd was required to deliver an assessment of its costs to the Douglases by 11 January 2016. The Douglases had until 25 January 2016 to respond to this assessment. If the parties could not agree on the costs by 8 February 2016, an assessor appointed by the Principal Registrar would determine the costs. This detailed timeline ensured clarity and accountability in the enforcement of the costs order.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established