Brett Wolinski Building Pty Ltd v HIA Insurance Services Pty Ltd

[2003] NSWSC 475

Reported Decision: (2003) 12 ANZ Insurance Cases 61-575

Supreme Court

CITATION:

Wolinski v HIA Insurance [2003] NSWSC 475

HEARING DATE(S):

3 April 2003

JUDGMENT DATE:

2 June 2003

JURISDICTION:

Common Law - Administrative Law List

JUDGMENT OF:

Master Harrison

DECISION:

(1) The decision of Senior Tribunal Member Christine Paull dated 16 September 2002 is affirmed; (2) The appeal is dismissed; (3) The summons is dismissed; (4) The plaintiff is to pay the second defendant's costs as agreed or assessed.

CATCHWORDS:

Appeal decision of FTT - preliminary issue, definition of building work - insurance

LEGISLATION CITED:

Building Act 1989
Consumer Trader & Tenancy Act
Fair Trading Tribunal Act
Fair Trading Tribunal Regulation 1999
Federal Court of Australia Act (1976) (Cth)
Fish Supply Management Act 1972-1976
Judicature Act 1873 (UK)
Supreme Court Act 1928

CASES CITED:

Canceri v Taylor (1994) 123 ALR 667
Collings Homes Pty Limited v Head [2002] NSWSC 1219
Crowe v Bennett; ex parte Crowe [1993] 1 QdR 57
Dowd v The President of Violet Town Shire (1899)_ 6 ALR (CN) 1
Ex parte Asher (1865) 4 SCR (NSW) 71
Ex parte Charlton (1869) 8 SCR (NSW) 158
Ex parte Lawrry (1868) 7 SCR (NSW) 183
Horne v Frank [2001] QDC 29
Khatri v Price [1999] FCA 1289
Lawford v Partridge (1857) 1 H&N 621
Perkins v County Court of Victoria & Ors [2000] 2 VR 246
Phillips v Morris [1999] 1 QdR 89
Queensland Fish Board v Bunney [1979] QdR 301
R v Justices of South Brisbane; ex parte Zagami (1901) 11 QLJ 81
Re Crittendon; Ex Parte The Law Institute of Victoria [1958] VR 101
Woolfe v Sussman [2001] NSWSC 702

PARTIES :

Brett Wolinski Building Pty Ltd
(Plaintiff)

HIA Insurance Services Pty Ltd
(First Defendant)

Royal & Sun Alliance Australia Limited
(Second Defendant)

CTTT
(Third Defendant)

FILE NUMBER(S):

SC 30070/2002

COUNSEL:

Mr R O'Keefe
(Second Defendant)

SOLICITORS:

Dr Doyle
The Builders' Lawyer
(Plaintiff)

Mr Ben Phillips
Minter Ellison
(Second Defendant)

LOWER COURTJURISDICTION:	FTT
LOWER COURT FILE NUMBER(S):	N/A
LOWER COURT JUDICIAL OFFICER :	Senior Tribunal Member Christine Paull

- 19 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION
ADMINISTRATIVE LAW LIST

MASTER HARRISON

MONDAY, 2 JUNE 2003

30070/2002 - BRETT WOLINSKI BUILDING PTY LTD v
HIA INSURANCE SERVICES PTY LTD
& 2 ORS

JUDGMENT (Appeal decision of FTT – preliminary
issue, definition of building work – insurance)

1 MASTER: By summons filed 28 August 2002, the plaintiff seeks orders firstly, that the orders of the Consumer Trader and Tenancy Tribunal (CTTT) made on 31 July 2002 be set aside; and secondly, that the matter be remitted to the Tribunal for rehearing and redetermination of all issues according to law. The plaintiff relied on the affidavit of Jayson Fung Choy Cheung sworn 12 November 2002.

2 The plaintiff is Brett Wolinski Building Pty Ltd. The first defendant is HIA Insurance Services Pty Ltd (HIA). The second defendant is Royal & Sun Alliance Australia Limited (Royal). The third defendant, the CTTT, filed a submitting appearance. This matter has been referred by the list Judge to a Master for hearing.

3 Section 60 of the Fair Trading Tribunal Act (FTT Act) provides that relief can be granted by way of a judgment or order in the nature of prohibition, mandamus, certiorari, and a declaratory judgment or an injunction if, in relation to the hearing or declaration of a matter where the Tribunal gave a ruling as to its jurisdiction, it was in error (s 60(2)) or a party had been denied procedural fairness.

4 The FTT Act has been repealed and replaced by the CTTT Act. However, Sch 6 cl 6 of the CTTT Act makes provision for proceedings in the former Tribunal, which were instituted before 25 February 2002 to be continued and determined as if the CTTT Act had not been enacted. The legislation specifically includes any proceedings that are the subject of an appeal to the Supreme Court. As the plaintiff’s claim was originally filed in the Fair Trading Tribunal on 13 August 2001, the FTT Act is to apply to these proceedings. In any event, both Acts contain similar provisions.

Grounds of appeal

5 The plaintiff’s grounds of appeal are firstly, that the decision by the Member of the Tribunal that the Tribunal had no jurisdiction in the matter assumed a finding of fact where the Member had no evidence to find; secondly, the claim by the plaintiff is premised upon a decision by the Home Owners Warranty (“HOW”) insurer to grant insurance; thirdly, if as a matter of fact the Tribunal found at the full hearing that the insurer did indeed grant HOW insurance, then it will have had jurisdiction to review the decision of the insurer not to continue, or to disavow the insurance policy under the express reservations continued in s 84(2) of the Home Building Act 1989 (HB Act); fourthly, the Member erred in granting the application of the first and second defendants for costs since the Member had already declared herself functus officio; fifthly, the Member erred in granting the costs of the proceedings to the first and second defendants when the matter had been in the Tribunal for many months, and had been subject to an earlier direction by another Member that the issue of jurisdiction and fact be heard together. According to the plaintiff, it is an abuse for a Member to contradict earlier orders upon which parties including the plaintiff relied and therefore in breach of ss 23 and 48(1) of the FTT Act.

The Tribunal proceedings

6 On 13 August 2001, the plaintiff lodged an application No. HB 01/78459 in the Home Building Division of the FTT against the first and second defendants. The claim concerning HIA was withdrawn and it plays no part in this appeal.

7 The plaintiff alleged that he and Royal entered into an agreement whereby Royal was to provide the insurance required under the HB Act in regard to residential building work which the plaintiff was to do for a consumer (who was not a party to the Tribunal proceedings). In return the plaintiff was to pay the relevant insurance premium. It was further alleged that Royal did not provide the insurance and as a result the plaintiff suffered loss and damage for which it was entitled to sue Royal in the Home Building Division of the Tribunal.

8 On 28 May 2002, directions were made that the parties file and exchange written submissions on jurisdiction. The matter was set down for a jurisdictional hearing before Senior Member Christine Paull on 31 July 2002. Hence the preliminary matter for determination before the Member was whether the Tribunal had jurisdiction to determine the application. The gravamen was whether the claim came within the definition of a building claim under the HB Act.

9 The relevant provisions of the HB Act were those contained in the now repealed sections 89A-C. For all practical purposes, the current definitions of a building claim, residential building work and building goods and services are similar, if not identical to the provisions they replace.

10 In particular, s 48A of the HB Act provides:

“Definitions
(1) In this Part:
“building claim” means a claim for:
(a) the payment of a specified sum of money, or
(b) the supply of specified services, or
(c) relief from payment of a specified sum of money, or
(d) the delivery, return or replacement of specified goods or goods of a specified description, or
(e) a combination of two or more of the remedies referred to in paragraphs (a)-(d),
that arises from a supply of building goods or services, whether under a contract or not, or that arises under a contract that is collateral to a contract for the supply of building goods or services, but does not include a claim that the regulations declare not to be a building claim.
“building dispute” means a dispute about building goods or services that may be the subject of a building claim,
“building goods or services” mean goods or services supplied for or in connection with the carrying out of residential building work or specialist work, being goods or services:
(a) supplied by the person who contracts to do that work, or
(b) supplied in such circumstances as may be prescribed to the person who contracts to do that work.
(2) Without limiting the definition of building claim, a building claim includes the following:
(a) an appeal against a decision of an insurer under a contract of insurance required to be entered into under this Act,
(b) a claim for compensation for loss arising from a breach of a statutory warranty implied under Part 2C.”

11 Also in s 3(1) of the Act “residential building work” is defined as meaning:

“any work involved in, or involved in co-ordinating or supervising any work involved in:
(a) the construction of a dwelling, or
(b) the making of alterations or additions to a dwelling, or
(c) the repairing, renovation, decoration or protective treatment of a dwelling.
It includes work declared by the regulations to be roof plumbing work or specialist work done in connection with a dwelling and work concerned in installing a prescribed fixture or apparatus in a dwelling (or in adding to, altering or repairing any such installation).
It does not include work that is declared by the regulations to be excluded from this definition.”

12 On 31 July 2002, the Senior Member ordered that the application be dismissed on the basis that the Tribunal had no jurisdiction to determine the application. The applicant was ordered to pay the respondent’s costs as agreed or assessed. On 16 September 2002, in response to a request, the Senior Member provided written reasons for her decision dated 31 July 2002.

13 Firstly, the plaintiff’s solicitor raised two submissions which can be shortly dealt with. These submissions were to the effect that the Tribunal Member’s record is incorrect.

14 In her reasons, the Tribunal Member stated:

“(I digress here to note that the definition of a building claim also specifically includes an action for the reversal of a decision of an insurance under a contract required to be entered into under the HBA. It was common ground that this part of the definition was not relevant to the matter before me.)”

15 The plaintiff’s solicitor submitted that this issue was not common ground at the hearing. There was no transcript taken of the proceedings in the Tribunal. In the absence of a transcript, affidavits by those who attended the hearing can be admitted as evidence as to what occurred before the Tribunal. No evidence was put forward by a solicitor who attended the hearing to support the proposition that the Tribunal Member’s record is incorrect. It would then fall to the Court to determine whether there was an error. In the absence of any evidence on this topic this submission fails.

16 The plaintiff’s solicitor also submitted that the Tribunal Member should not have decided the jurisdictional issue until she had determined the facts. Once again, there was no evidence to suggest that there was a submission to this effect made to her. What is recorded in the Tribunal Member’s judgment is that, in accordance with previous directions made, the parties had filed and exchanged written submissions on jurisdiction and the matter was set down for a jurisdictional hearing. The Tribunal Member noted that at the previous directions hearing when she had suggested that the jurisdictional issue be ventilated, first by written submissions and then by separate hearing, the plaintiff’s solicitor took no objection to that course. The Tribunal Member also stated:

“In any event I do not agree with this submission. It appears to me that there was a clear threshold issue as to jurisdiction that needed to be determined. Namely, whether the definition of a building claim encompasses a dispute between a builder and an insurer. Determining this threshold issue initially and separately allowed the matter to be dealt with economically and expediently without having to put the parties to the expense of a full hearing.”

17 The plaintiff cannot now complain about the course of action that was adopted by him.

18 There was an affidavit of the plaintiff sworn 10 August 2001 before the Tribunal Member (Ex 1). The plaintiff deposed that he prepared a quote to carry out building residential works at Roseville. On 8 June 2001, the plaintiff completed a project application to insure the works and forwarded it to HIA Insurance offices. He deposed to conversations that he had with the insurer but these conversations never culminated in a certificate of insurance being issued. The plaintiff builder never entered into a building contract with the party who was seeking to renovate the Roseville property.

19 In her reasons dated 16 September 2002, the Tribunal Member stated:

“In that Act, the definition of a building claim is premised on the definition of “building goods” or “building services”. Building goods and services are defined as goods and services supplied by the person who contracts to do the “residential building work”.

This leads to a consideration of the definition of “residential building work” under the HBA. On my reading the definition of residential building work (and indeed the whole emphasis of the HBA) is on the physical building work done or to be done in relation to peoples homes or dwellings and the regulation of those who are to carry out that physical work. This is also supported in the relevant second Reading Speech. It does not appear to me that the legislation is directed towards disputes between builders and insurers over the provision of insurance.

The application before the Tribunal was in my view too far removed from the ambit of the definition of a building claim (as defined under the HBA) not being one relating is [sic] the physical construction, alteration or repair of a dwelling.
I was assisted in coming to this view by His Honour, McClellan J in Woolfe v Alexander Sussman (trading as A Sussman Construction and Consulting Services) (Supreme Court of New South Wales, Common Law Division, No. 1037-01, 18 July 2001) where his honour stated:-
“In my opinion, residential building work is, as the definition may explain, confined to building work in pursuant of the physical construction or alteration of a dwelling. It does not extend to goods or services provided in the course of considering the feasibility of the redevelopment of property or the means by which utilising suitable valuations and cash flow projections for the redevelopment of a property may be financed.”
It is for this reason that I also rejected the Applicants argument that I should follow my previous decision in another matter, BU 2001/4996 Prudential Homes Pty Limited v Doyle. In that case I was satisfied, on the breadth of the definition of residential building work, that the Tribunal had jurisdiction. That case is distinguishable from the present. In that case the building claim arose from a dispute between a consumer (being a home owner) and a builder who had agreed to enter into a contract which involved the builder preparing designs, plans and specification, obtaining the necessary local council approvals and constructing the residential building work. Although the contract did not proceed to completion, the agreement between the parties and the services that were the subject of that agreement related to the goods and services which the builder was to provide to the consumer in carrying out physical, residential building work to his home.
I turn now to the other matters specifically raised by the Applicant.
Firstly, while I agreed with the Application’s submission, that a building claim need not necessarily arise under a contract, for reasons I have previously stated, it is my view that such a claim must arise from the supply of building goods and services involved in the physical construction of a dwelling by the person who is to supply those goods or services.”

20 The plaintiff’s solicitor cited a number of decisions, some of which he submitted were wrongly decided. The starting point, I think is the decision referred to by the Tribunal Member, namely, Woolfe v Sussman [2001] NSWSC 702.

21 In Sussman, the court was considering whether a feasibility study of a redevelopment of property fell within the definition of “residential building work”. It did not. His Honour specifically considered the definition of “residential work” in s 3(1) and “building claim” in s 84(1) of the Act. The definition of “residential work” is building work in pursuance of physical construction or alteration of a dwelling.

22 Master Malpass in Collings Homes Pty Limited v Head [2002] NSWSC 1219 applied Sussman. At paragraph [28] he stated that in order to satisfy the definition of “residential building work”, the work must be involved in or involved in co-ordinating or supervising any work involved in the construction of a dwelling. Master Malpass decided that services such as the design of the home and the provisions for costing building work did not fall within the definition of “residential building work”. As previously stated, the plaintiff submitted that these decisions were wrong.

23 A contract of insurance between a builder and an insurer does not fall within the definition of building work as being in pursuance of physical construction or alteration of a dwelling. The plaintiff’s claim does not fall within the definition of “residential building work”. It follows that the claim is not one which can be defined as “building goods or services”.

Whether the contract in issue was collateral to a building contract

24 The plaintiff submitted that the insurance contract was collateral one. In this regard, the Tribunal Member stated:

“…As I understand it, the argument was that there was a contract between the Applicant as builder and a consumer being the owner of a dwelling. The transaction which was the subject of the application before the Tribunal ‘arose’ from this ‘contract’, as the Applicant approached the Respondent to obtain the relevant HBA insurance for that dwelling.
In putting forward this submission the Applicant argued that the term collateral must be given its every day usage. I found against the Applicant on this submission. The relevant part of the definition of building claim states:-
“or that arises under a contract that is collateral to a contract to the supply of goods or services.”
It is my view that this definition refers to the term collateral contract as it is understood at law, namely, that there must be common parties between the primary and the collateral contracts. This was not the case here.

25 Even if the Tribunal Member is wrong and the collateral contract did not have to have the parties common to the primary contract and even if the primary contract of insurance existed, there was no collateral contract between the builder and the party seeking to have the renovations carried out. Hence, even on the plaintiff’s best case there was never a contract and a collateral contract in existence. Accordingly, this submission fails. The Tribunal Member’s determination that the Tribunal had no jurisdiction to hear this matter is correct. There is no error of law.

Costs

26 The plaintiff submitted that once the Tribunal Member held that she did not have jurisdiction to hear the claim, she did not have power to award costs. The second defendant submitted that the Tribunal Member did have the power to award costs notwithstanding her finding that there was no jurisdiction.

27 In relation to costs the Tribunal Member stated:

At the conclusion of the proceedings, when I delivered my extempore decision the Respondent made an application for costs. Being satisfied that I had the power to award costs within the relevant statutory framework of the Fair Trading Tribunal Act, I proceed to do so on basis that costs follow the event.

The Applicant raised the issue of my being “functus” having determined that the Tribunal had no jurisdiction. Clearly, following my jurisdictional ruling, the Tribunal is functus to consider any further application or step in the proceedings. It is my view, however, that this is not the case in relation to an application for costs which was part of an arose directly from the hearing at which the jurisdictional ruling was made.”

28 The plaintiff referred to two cases, namely Horne v Frank [2001] QDC 29 (2 March 2001) and Khatri v Price [1999] FCA 1289 (15 September 1999). In Khatri, the Federal Court did not have the jurisdiction to grant the relief sought by the plaintiff. However, the plaintiff sought an order for costs and argued that the Court still had jurisdiction to award them. The plaintiff relied upon s 43 (1) of the Federal Court of Australia Act (1976) (Cth) which provided that:

“A Judge has jurisdiction to award costs in all proceedings before the Court (including proceedings dismissed for want of jurisdiction).”

29 Katz J in rejecting the plaintiff’s claim, said of this provision, at para 17-19:

“As I construe s 43 (1) of the Act, the “proceedings” to which it first refers are the typical ones before this Court, namely, those in which the purported invocation of this Court’s jurisdiction has been proper. Then, to deal with those proceedings before it in which the only jurisdiction which the Court has actually exercised has been its limited jurisdiction to determine that it does not have the jurisdiction purportedly invoked, subs 43(1) of the Act confers, by its parenthetical words, a jurisdiction to award costs in proceedings dismissed for want of jurisdiction. (Presumably, in cases where the Court has exercised the discretion to which I referred in par 14 above, that jurisdiction to award costs in proceedings dismissed for want of jurisdiction is intended to extend, not only to the costs of the jurisdictional aspect of the case, but also to the costs resulting from the hearing of evidence and argument on issues which would have arisen in the proceeding if the Court had held that it did have the jurisdiction purportedly invoked.)
…
… Mr Khatri was unable to point to any case (nor have I been able to find one myself) in which a conferral of jurisdiction upon a court to award costs in proceedings before it has been construed as authorising the awarding of costs in proceedings in which the court concerned has purported to exercise a non-existent jurisdiction. The absence of any such case is entirely unsurprising to me.”

30 The same question was raised in Horne and in that case McGill DCJ concluded at para 36:

“...[I]n my opinion, in the case of an inferior court the existence of jurisdiction to decide whether or not there is jurisdiction to deal with a particular matter does not imply the existence of a power to deal with the costs involved in relation to either that determination or the matter as a whole.”

31 As McGill DCJ found in reaching this conclusion, there is long established authority to support the proposition that, in the absence of a power vested in it by statute, an inferior court cannot award costs where it decides it has no jurisdiction in a matter: Lawford v Partridge (1857) 1 H&N 621; Ex parte Asher (1865) 4 SCR (NSW) 71; Ex parte Lawry (1868) 7 SCR (NSW) 183; Ex parte Charlton (1869) 8 SCR (NSW) 158; Dowd v The President of Violet Town Shire (1899) 6 ALR (CN) 1. See also R v Justices of South Brisbane; ex parte Zagami (1901) 11 QLJ 81; Queensland Fish Board v Bunney [1979] QdR 301; Crowe v Bennett; ex parte Crowe [1993] 1 QdR 57; Phillips v Morris [1999] 1 QdR 89. As with inferior courts, the FTT was a creature of statute and in the absence of a power vested in it by statute, it cannot award costs where it decides that it has no jurisdiction in a matter.

32 Turning to the statute, the FTT Act at s 48, provides in respect of costs that:

“(1) The parties to a matter before the Tribunal are to bear their own costs, except as provided by this section.

(2) In cases where an amount is claimed or disputed, costs are not to be awarded if the amount does not exceed $10,000 (or such other amount as may be prescribed by the regulations) unless the Tribunal is of the opinion that the exceptional circumstances of the case warrant an award of costs.

(3) Except as otherwise provided by the regulations or by any other Act or law, in cases where an amount is claimed or disputed in the Commercial Division or the Home Building Division, the Tribunal may award costs if:


(a) the amount claimed or disputed exceeds $10,000 (or such other amount as may be prescribed by the regulations), and

(b) the parties were granted the right to legal representation.

(4) The Tribunal may, however, in any case award costs in relation to proceedings before it in any Division:

(a) in respect of expenses incurred in obtaining professional or expert services (other than legal services), if the amount ordered to be paid by the Tribunal exceeds the amount prescribed for the purposes of this paragraph, or

(b) in respect of expenses incurred in a manner or in circumstances prescribed by the regulations, or

(c) in respect of any particular expenses, if it is satisfied that there are special circumstances warranting an award of costs in respect of them.
(5) If costs are to be awarded, 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 Division 6 of Part 11 of the Legal Profession Act 1987 or on any other basis.

(6) In this section, "costs" includes:

(a) costs of or incidental to proceedings in the Tribunal, and

(b) the costs of or incidental to the application.”

33 And Regulation 32(2) of the Fair Trading Tribunal Regulation 1999 provides that:

“Under section 48(4)(b) of the Act, the Tribunal may order:
(a) that the costs of proceedings on an application for rehearing of a matter be borne wholly or in part by the applicant, if the applicant fails to attend the hearing of the application, or
(b) that the costs of proceedings adjudged by the Tribunal to be frivolous, vexatious, misconceived or lacking in substance, or as otherwise not to be entertained, be borne wholly or in part by the person who instituted them.”

34 There is no specific mention in these provisions of a power to award costs where the Tribunal lacks jurisdiction. The second defendant submitted that pursuant to reg 32 cl 2(b) the Tribunal may award costs in any proceedings that the Tribunal considers to be frivolous, vexatious, misconceived, or as otherwise not to be heard or proceeded with...” These alternatives are aimed at the claim being brought without merit, not without jurisdiction. Although reg 32 cl 2(b) provides for costs in a situation where the Tribunal finds that an action is “otherwise not to be heard or proceeded with” this would seem to be a reference to applications that are withdrawn or not prosecuted.

35 However, pursuant to s 48(6) the Tribunal may award “costs of, or incidental to proceedings” or “costs of or incidental to the application”. This provision appears to be a basis of power for the award of costs by the Tribunal where it is without jurisdiction. As noted by McGill DCJ in Horne at para 36, where a power to award costs is granted to a court by statute it must be conferred expressly. However, it can also be granted by necessary implication, although in this instance the existence of the power must clearly appear.

36 Authority for the proposition that the power to award costs can be conferred by necessary implication is found in Queensland Fish Board v Bunney [1979] QdR 301. In Bunney the Full Court of the Queensland Supreme Court had to determine the issue as to whether s 61(1)(e) of the Fish Supply Management Act 1972-1976 was broad enough to warrant an order by a Magistrates Court for costs where it was alleged that it had no jurisdiction to make such an order. Under s 61(1)(e), the Magistrates Court was empowered to: “make any other order it considers just”. Connolly J, with whom Wanstall CJ and Lucas J agreed, found that this provision was not broad enough. The fact that the provision made no reference to costs at all and contained no clear indication of an intention to confer such a power was key to His Honour’s finding. Connolly J said, at 303:

“It must be remembered that there is a well established principle that apart from the inherent jurisdiction of the court of chancery, costs are entirely the creation of statute and there is no common law jurisdiction in tribunals to grant costs...Some of the older decisions suggest that the power to award costs must be conferred in express terms. See e.g. Service v Flateau (1900) 16 W.N. (N.S.W.) 248...but the better view would seem to be that the power can be conferred expressly or by necessary implication: Spicer v Carmody 48 S.R. (N.S.W.) 348 at p.350. Having regard to this principle however, the power must at least clearly appear.

37 This passage was cited approvingly by Moore J in Canceri v Taylor (1994) 123 ALR 667, at 672, who noted that his own review of authorities led him to the same “general conclusion”.

38 However, in Re Crittendon; Ex Parte The Law Institute of Victoria [1958] VR 101 The Full Court of the Supreme Court of Victoria had to determine whether the Court had power to award costs where it was contended it was without jurisdiction to hear a matter and therefore had no jurisdiction to award costs. The Supreme Court Act 1928, s32 (1) provided that:

“Subject to the provisions of this Act and to Rules of Court and to the express provisions of any other Act the costs of and incidental to all proceedings in the Court including the administration of estates and trusts shall be in the discretion of the Court or Judge and the Court or Judge shall have full power to determine by whom and to what extent costs are to be paid”

39 Lowe J, at 102, found that the Court’s power to deal with costs in the circumstances derived from this provision. The issue, which he sought to address, was whether the particular matter before him was one that could be characterised as a “proceeding”. He found that it was such a case.

40 A similar question arose before the Supreme Court of Victoria in Perkins v County Court of Victoria & Ors [2000] 2 VR 246. However, the issue raised was whether the Court had jurisdiction to award costs. It was not in dispute that the Court had jurisdiction to entertain the judicial review in a criminal matter. In Perkins, the Supreme Court Act 1986 (Vic), s 24(1) read:

“Unless otherwise provided by this or any other Act or by the Rules, the costs of and incidental to all matters in the Court, including the administration of estates and trusts, is in the discretion of the Court and the Court has full power to determine by whom and to what extent the costs are to be paid...”

41 The case is instructive only so far as it traces the history of s 24, going back to the Judicature Act 1873 (UK) and the interpretation given to the words costs “of and incidental to all matter in the Court”.

42 Phillips JA, at 248, said of this provision:

“On its face the jurisdiction thus conferred on the court over costs was ample enough to justify the award of costs made by the judge in this proceeding for judicial review; the grant of power is in respect of the costs “of and incidental to all matters in the Court...”

43 Later in his judgment, when determining the question of jurisdiction, His Honour noted that the provision did not apply to trials on indictment but concluded at 250 that:

“...s24(1) should be read, I think, as conferring a general jurisdiction, according to its terms, over “the costs of and incidental to all matters in the Court.”

44 His Honour accordingly found that costs could be awarded pursuant to this provision where it was alleged the Court was without jurisdiction to do so.

45 The provisions dealt with in Re Crittendon and Perkins, which refer to “costs of and incidental to” are similar to s 48 (5) of the FTT which provides that the Tribunal may determine “by whom and to what extent costs are to be paid...”. Section 48(6)(a) and (b) further defines costs as those: “of or incidental to proceedings in the Tribunal, and the costs of or incidental to the application”. By analogy, s 48(5) and (6)(a) and (b) confer upon the Tribunal a general power to award costs where the Tribunal is without jurisdiction. Unlike the provision dealt with by Connolly J in Bunney, the language of ss 48(5) and (6)(a) and (b) conveys a clear indication of an intention to confer a power to award costs and sets out a power to award costs incidental to an application to the Tribunal. By necessary implication the provision is broad enough to be a source of power for the award of costs where the Tribunal is without jurisdiction.

46 Accordingly, it is my view that s 48 of the FTT Act conferred on the Tribunal member a general power to award costs when she determined that the Tribunal was without jurisdiction. Thus, the Tribunal Member was entitled to make the costs order. The decision of the Tribunal Member dated 31 July 2002 is affirmed. There is no error of law. The appeal is dismissed. The summons is dismissed.

47 Costs normally follow the event. The plaintiff is to pay the second defendant’s costs as agreed or assessed.

48 The court orders that:

(1) The decision of Senior Tribunal Member Christine Paull dated 16 September 2002 is affirmed.

(2) The appeal is dismissed.

(3) The summons is dismissed.

(4) The plaintiff is to pay the second defendant’s costs as agreed or assessed.
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Last Modified: 06/12/2003