CLAY and THE OWNERS OF CARINYA COURT ROCKINGHAM STRATA PLAN 25819 - [2024] WASAT 121 (S)

JURISDICTION     :   STATE ADMINISTRATIVE TRIBUNAL
ACT: STRATA TITLES ACT 1985 (WA)
CITATION:   CLAY and THE OWNERS OF CARINYA COURT ROCKINGHAM STRATA PLAN 25819 [2024] WASAT 121 (S)
MEMBER:   MS R PETRUCCI, MEMBER
HEARD:   DETERMINED ON THE DOCUMENTS
DELIVERED          :   11 FEBRUARY 2025
FILE NO/S:   CC 88 of 2024
BETWEEN:   MARK GREGORY CLAY
Applicant
AND
THE OWNERS OF CARINYA COURT ROCKINGHAM STRATA PLAN 25819
Respondent

Catchwords:

Strata Titles Act 1985 (WA) - Application for costs - Scheme dispute - Interim applications - Costs of proceeding - Objectives of Tribunal - Onus on party seeking costs order - Nature of dispute - Conduct of parties - Whether fair and reasonable to award costs - Discretion of Tribunal to award costs - Broadbrush approach as a matter of impression and without attempt at mathematical precision

Legislation:

Legal Profession (State Administrative Tribunal) Determination 2022 (WA)
Legal Profession (State Administrative Tribunal) Determination 2024 (WA)
State Administrative Tribunal Act 2004 (WA), s 9, s 60(2), s 87(2)
Strata Titles Act 1985 (WA) (prior to 1 May 2020), s 81(7)
Strata Titles Act 1985 (WA), s 3, s 107, s 197(4), Sch 5, cl 30(1)
Strata Titles Amendment Act 2018 (WA)

Result:

Application for costs partly successful
Order for costs made

Category: B

Representation:

Counsel:

Applicant	:	N/A
Respondent	:	Ms SE Macmillan

Solicitors:

Applicant	:	N/A
Respondent	:	Macmillan Legal

Case(s) referred to in decision(s):

Banning and The Owners of Terrace Place Strata Plan 9704 [2019] WASAT 89
Clay and The Owners of Carinya Court Rockingham Strata Plan 25819 [2024] WASAT 121
Giabeni and The Owners of 30 Coode Street Mount Lawley Strata Plan 11321 [2024] WASAT 105 (S)
Western Australian Planning Commission v Questdale Holdings Pty Ltd [2016] WASCA 32

REASONS FOR DECISION OF THE TRIBUNAL:

Introduction

On 11 November 2024, the Tribunal published its decision in Clay and The Owners of Carinya Court Rockingham Strata Plan 25819 [2024] WASAT 121 (the substantive decision). It concerns a scheme dispute under s 197(4) of the Strata Titles Act 1985 (WA) (ST Act).
Mr Clay's application was unsuccessful apart from issue 8 which concerned the proper construction of Sch 1 by-law 17 - debt recovery costs. Mr Clay raised this issue on the last day of the final hearing, and with consent of The Owners of Carinya Court Rockingham Strata Plan 25819 (strata company), both parties filed written submissions. Mr Clay did not seek any order from the Tribunal regarding issue 8 and therefore no order was made.
Following publication of the substantive decision, on 2 December 2024, the strata company filed its application for costs under s 87(2) of the State Administrative Tribunal Act 2004 (WA) (SAT Act). Further, on 3 December 2024, the strata company filed written submissions in support of its application seeking costs fixed in the amount of $52,788.25.
Historically, prior to 1 May 2020, the Tribunal could not make an order for costs under the ST Act except in two circumstances. The first circumstance arose where the applicant was given leave by the Tribunal to amend their application to compensate persons (for example, the respondent) for time unnecessarily spent in connection with the application. The only other circumstance was concerning a variation to unit entitlements.[1]
[1] Section 81(7) of the ST Act prior to 1 May 2020. See generally Banning and The Owners of Terrace Place Strata Plan 9704 [2019] WASAT 89 at [75] to [77].
As a result of the major amendments to the ST Act, which came into operation on 1 May 2020 under the Strata Titles Amendment Act 2018 (WA), the Tribunal is now not so limited in making orders for the payment of costs under the ST Act. Consequently, as Mr Clay commenced the proceeding in the Tribunal on 14 February 2024, that is after the major amendments, the provisions of the ST Act apply to the determination of the strata company's application for costs (Sch 5 cl 30(1) of the ST Act).
On 3 December 2024, the Tribunal made orders for Mr Clay to file written submissions in reply to the strata company's application for costs.
Following Mr Clay filing his written submissions opposing the costs application,[2] on 19 December 2024, the Tribunal reserved the issue of costs to be determined on the documents pursuant to s 60(2) of the SAT Act.
[2] Mr Clay's submission on the strata company's application for costs filed on 18 December 2024 at page 1.
The legislative framework and principles for determining a costs application were most recently detailed in Giabeni and The Owners of 30 Coode Street Mount Lawley Strata Plan 11321 [2024] WASAT 105 (S) at [16] to [32]. It is not necessary to repeat them here other than to say I adopt the legislative framework and I have applied the principles in determining the costs application in this case.

In the following reasons, I explain why in my view it is fair and reasonable in all of the particular circumstances or realities of this case to make final orders to require Mr Clay to pay costs of the strata company fixed in the amount of $30,000 within 30 days of this order, or some other timeframe as agreed in writing by the parties.

Costs - the parties' position

In claiming its costs, the strata company must discharge the onus of establishing that it is fair and reasonable in the circumstances or the realities of this case for it to be awarded its costs. This is often referred to the onus probandi.
The parties are a long way apart in respect of the appropriate orders as to costs in the proceeding.

The strata company's position on costs

The strata company seeks reimbursement of its costs fixed in the amount of $52,788.25.[3]
[3] Strata company's application for costs filed 2 December 2024.
Counsel for the strata company submits that the Tribunal should exercise its discretion to award the strata company its costs in the proceeding for the following reasons:[4]
(a)the strata company was entirely successful in the proceeding having been found to have acted in good faith in an attempt to comply with the ST Act and orders of the Tribunal related to the annual general meeting held on 14 December 2023 (2023 AGM);
(b)the long history, nature and complexity of the matter not only justified but required the strata company to engage legal representation;
(c)Mr Clay is self-described as a non-practising lawyer and drew upon his legal knowledge and skills when construing and interpreting the provisions of the ST Act for the purposes of his application(s);
(d)the issues in dispute were such as to warrant the strata company's engagement of legal representatives to advise and represent it in the proceeding to ensure its case was prepared and presented in an appropriate and structured manner;
(e)the conduct of Mr Clay in respect of the nature of his complaints led to unnecessary legal costs being incurred by the strata company; and
(f)in the absence of legal representation, the strata company would have been disadvantaged in the proceeding, given the breadth of the issues raised by Mr Clay and the nature of the legal responses required.
[4] Stata company's submissions in support of any application for costs pursuant to s 87(2) of the SAT Act filed on 3 December 2024 at pages 2 to 3.
In summary, it is the position of the strata company that Mr Clay has been the protagonist in the long history of conflict between himself and the majority of the owners in the strata scheme, which he has described as 'intractable disagreements'.[5] This 'intractability' to which Mr Clay refers, is twofold according to the strata company. First, Mr Clay's attitude is unbending and controlling that is characterised by his unwillingness to accept the views and decisions of the majority of the members of the strata company, or of the 'changing of the guard' of the membership of the council.[6] Second, Mr Clay refuses to accept the orders and the decisions made by the Tribunal (differently constituted) in prior proceedings.[7]
[5] Ibid at page 15.
[6] The 'council' is the governing body of the strata company: s 3 of the ST Act.
[7] Above n 4 at page 16.
It is submitted by counsel for the strata company that it is Mr Clay's 'rage' against all efforts by the council to move on positively from the proceedings in the Tribunal for the benefit of all owners in the strata scheme where he seeks to continue to control the strata company and has deliberately and capriciously 'perpetuated the storm that embroiled' the strata company in three recent successive proceedings in the Tribunal.[8]
[8] Ibid.
To conclude, counsel for the strata company submits that by his actions, Mr Clay has demonstrated no remorse or care for the financial and emotional strain the recent successive proceedings have inflicted on the other owners in the strata scheme whom he has 'left to drown in his wake'.[9]

Mr Clay's position on costs

[9] Ibid.

In contrast, Mr Clay asserts that despite the 'very real issues that [he has] with many of the findings and statement[s] in the Reasons for Decision' as set out in the substantive decision and 'the fact that all or virtually all the findings and orders [made by the Tribunal] have been made [by the Tribunal] in the exercise of a discretion rather than on the basis of a finding that [his] claims were not valid' or that the findings made are beneficial to all parties, justifies his position that there be no order for costs.[10] Put simply, Mr Clay says that there 'should be no cost consequences'.[11]
[10] Above n 2 at page 1.
[11] Above n 2 at page 5.
It is the belief of Mr Clay that his analysis of the substantive decision would provide strong grounds for him to seek 'a review and/or appeal' of the substantive decision, however, he has decided not to seek 'a review or appeal' for the following reasons:
(a)for the reasons stated in the substantive decision at [304], that 'it is now time for Mr Clay and the strata company to accept that the past has happened, to learn from it, and to move on in the interests of all of the members of the strata company';
(b)that any review or appeal would impose further material costs on all members in that any costs borne by the strata company are ultimately paid for by the members;
(c)any finality in the matter would be unduly delayed, again to the detriment of all owners, regardless of the review/appeal outcome; and
(d)the passage of time would make rectification a very difficult exercise if the review/appeal were successful and that issue could itself be a factor in a review/appeal.
If, by making the statements at (a) to (d) in the preceding paragraph, it is Mr Clay's intention to signal to the strata company that he genuinely seeks for the parties to move forward then his comments about bringing finality to what Mr Clay describes as the 'intractable disagreements' between the parties is a positive step forward. However, in my view, the great lengths that Mr Clay went to in his written submissions setting out why, in his analysis of the substantive decision the reasons why he would have strong grounds to seek a 'review and/or appeal' is not relevant in the exercise of the Tribunal's discretion to make an award of costs. Consequently, I have disregarded most of fourteen pages of written submissions made by Mr Clay, apart from the few submissions that address the costs application.[12]
[12] Above n 2 at pages 1 to 14.
Before turning to the consider the parties' contentions on the quantum of costs, it is useful to start by outlining a history of the proceeding in the Tribunal by reference to the documents lodged by, and the actions of the parties in relation to the proceeding.

History of the current proceeding

On 14 February 2024, Mr Clay filed his application with the Tribunal for the resolution of a scheme dispute under the ST Act, following which the Tribunal made orders, by consent of the parties, referring the matter to mediation.
The matter did not resolve, nor were the issues narrowed down, at the two mediation sessions conducted in March 2024.
On the same date that Mr Clay filed his application with the Tribunal (14 February 2024), he also filed his first (of four) interim applications. The Tribunal, following agreement of the strata company, made an order staying legal action by the strata company against Mr Clay for the payment of outstanding strata levies until the current proceeding was determined.
On 8 April 2024, the strata company gave notice to the Tribunal of its legal representation.
On 16 April 2024, the Tribunal made orders requiring each party to file a statement of issues, facts and contentions (SIFC), book of documents and a list of witnesses to be called to give evidence. The final hearing was listed for 19 July 2024.
On 6 May 2024, Mr Clay filed his SIFC along with annexures 1 to 3.
On 30 May 2024, the strata company filed its SIFC, book of documents and list of witnesses. This was after the Tribunal granted the strata company an extension of time to 31 May 2024 (an extension of four days).
Mr Clay filed an interim application (second) on 3 June 2024.
On 6 June 2024, the strata company filed a letter of objection to the listing of a hearing for Mr Clay's second interim application.
On 10 June 2024, Mr Clay filed his response to the strata company's SIFC and a letter in reply to the letter of objection filed by the strata company on 6 June 2024. Mr Clay did not file his book of documents and a list of witnesses to be called to give evidence at the final hearing by 10 June 2024 as required by the orders of the Tribunal made on 16 April 2024.
On 20 June 2024, Mr Clay filed a further interim application (third).
On 29 June 2024, Mr Clay filed a letter to the Tribunal and attached to the letter proposed resolutions that he circulated by email to the members of the strata company.
On 1 July 2024, the strata company filed its response to Mr Clay's second and third interim applications together with a letter to the Tribunal.
Mr Clay's second and third interim applications were dealt with by the Tribunal by way of a directions hearing on 1 July 2024. The Tribunal dismissed Mr Clay's second interim application in which he sought for the orders made by the Tribunal on 16 April 2024 be set aside and to vacate and relist the final hearing (listed on 19 July 2024). Further, on 1 July 2024, the Tribunal granted an extension of time for Mr Clay to file his SIFC, book of documents and list of witnesses to 10 July 2024 (from the original date of 10 June 2024). The consequence of this is that the strata company's due date to file its book of documents, list of witnesses and witness statements was extended to 17 July 2024 (from 1 July 2024) being seven days after Mr Clay had to file and just two days before the final hearing.
Finally, on 1 July 2024 the Tribunal granted leave to Mr Clay to amend his application by reference to the amended final orders sought and amended grounds that he had filed with the Tribunal on 4 March 2024 but had not previously sought leave of the Tribunal to amend his application.
On 19 July 2024, following the final hearing, the Tribunal made orders for the parties to file closing written submissions including, by consent of the parties, two new issues raised by Mr Clay on the last day of the final hearing. Those written submissions were due by 5 August 2024. That date was extended to 12 August 2024 by consent of the parties. Further, on 12 August 2024, the Tribunal granted a further extension to the strata company to file its submission by 13 August 2024 (an extension of one day).
On 29 July 2024, following the final hearing, Mr Clay filed a further interim application (fourth).
On 31 July 2024 counsel for the strata company filed its response to Mr Clay's further interim application.
On 16 August 2024, the Tribunal gave leave for Mr Clay to file a corrected 'Applicant's bundle of documents volume 3' and a copy of the order made by the Tribunal (differently constituted) on 24 October 2023 in matter CC 1099 of 2023 with the document titled 'Owner Ledger from 1/10/19 to 1/9/20' prepared by B Strata (the former strata manager for the strata company).
Following receipt of closing written submissions, on 16 August 2024, the Tribunal reserved its decision. The substantive decision was published on 11 November 2024.
On 3 December 2024 the strata company filed its application for costs and on 18 December 2024, Mr Clay filed his written submissions opposing any order for costs. On 19 December 2024, the Tribunal reserved its decision on the costs application.
I now turn to consider whether in the particular circumstances or realities of this case, it is fair and reasonable that the strata company should be reimbursed for the costs it incurred, and if so, in what amount?

Costs - Exercise of Tribunal's discretion

The following is a summary of the main points put forward by counsel for the strata company in support of its position for an order for costs:[13]
[13] Above n 2 at pages 3 to 4.
(a)Mr Clay expressed dissatisfaction with the settled outcome of the compulsory conference in the previous proceeding CC 1099 of 2023 and sought to reagitate and reventilate matters in the current proceeding even though they had already been determined in that proceeding. By including those issues, Mr Clay unreasonably expanded the issues for determination in the current proceeding and in doing so Mr Clay ignored any responsibility to have regard to the legal costs caused to the strata company;
(b)Mr Clay misled the Tribunal about matters related to the settled outcome in the previous proceeding CC 1099 of 2023 and the confidential deliberations in that proceeding. Further, Mr Clay embellished matters for the purpose of persuading the Tribunal to his point of view as to the confirmation of meeting minutes (issue 2 of the substantive decision at [159] to [177]);
(c)the interim application filed by Mr Clay on 3 June 2024 unreasonably sought to compel the strata company to seek to strike it out in circumstances where the strata company had informed Mr Clay that such application was neither necessary nor warranted. The issue was resolved by the Tribunal striking out words from the strata company's response, as had been suggested and conveyed to Mr Clay and to the Tribunal by counsel for the strata company by letter prior to the interim application hearing. The purpose of the letter was to negate the interim application hearing and to promote the objectives of the Tribunal;
(d)the second interim application filed by Mr Clay on 20 June 2024 was without merit and beyond the jurisdiction of the Tribunal as it related to demands for information to be provided to him by way of discovery rather than by application under s 107 of the ST Act, with which Mr Clay refused to comply, capriciously deciding instead to file an interim application and thereby cause unwarranted legal costs to the strata company;
(e)Mr Clay's request for information was directed to counsel for the strata company rather than to the strata company or to its strata manager as provided for by s 107 of the ST Act. Mr Clay's refusal to make his application under s 107 of ST Act caused unwarranted legal costs to be incurred by the strata company;
(f)Mr Clay did not comply with orders of the Tribunal which resulted in the Tribunal granting him an extension of time of one month to file his bundle of documents and witness statements and thereby constrained both the time available for the strata company to prepare and present its case for the final hearing and for the Tribunal's capacity to read the voluminous documents (in excess of 1,700 pages);
(g)Mr Clay's application incorporated applications for both interim and final orders. On 4 March 2024, Mr Clay filed amended final orders and amended grounds without seeking or obtaining the leave of the Tribunal;
(h)in his application, Mr Clay included issues that were dealt with in the earlier proceeding CC 579 of 2020 and the previous proceeding CC 1099 of 2023. By doing this, Mr Clay increased the complexity of the work for the strata company to respond to, along with the associated legal costs and disbursements. The consequence is that Mr Clay enlarged both the subject matter and length of the documents filed by him as well as the responsive documents that the strata company had to file to support its position;
(i)Mr Clay's witness statement was 44 pages long and contained an inordinate amount of information irrelevant to the determination of the application. Further, at the final hearing, Mr Clay read from a further witness statement which he did not file with the Tribunal;
(j)the hearing book comprised 1,767 pages which was later revised by Mr Clay by filing, after the final hearing was concluded, a corrected bundle of documents and other materials; and
(k)the final hearing was for one day following which the parties were ordered to file closing written submissions.

In contrast, the following is a summary of Mr Clay's main points opposing any order for costs:
(a)the members of the council initially declined to participate in the mediation and that in the end the mediation process 'was very one sided';[14]
(b)when he filed his amended orders sought on 4 March 2024, he was of the understanding that he did not require leave of the Tribunal as there had not been any substantive procedure that had occurred in the proceeding. He says that he understood the mediation to be separate from the proceeding;
(c)he did not oppose the orders made by the Tribunal on 16 April 2024 and it may have been him who suggested a one day hearing would be appropriate;
(d)his interim application of 3 June 2024 was made because the strata company failed to comply with the orders of 16 April 2024;
(e)the core of his objections and interim application resulted in the Tribunal striking out part of the strata company's document filed in response to the orders of 16 April 2024;
(f)he has at no time expressed dissatisfaction with the final orders made in the previous proceeding CC 1099 of 2023 but there were disagreements between the parties as to the meaning and effect of some of the terms of the orders as they were 'drafted in rather vague and imprecise terms' by the Tribunal (differently constituted);
(g)he had no way of knowing that the Tribunal 'had not followed its normal procedure [to] inform all parties' of its decision regarding his interim application (fourth) made on 29 July 2024 following the conclusion of the final hearing on 19 July 2024;
(h)he rejects all the negative inferences made against him by the strata company;
(i)the strata company sought indulgences from him for extra time or agreement of other matters which he willingly agreed to and he believes he did so without exception, including the strata company's numerous requests for extra time to file documents; and
(j)the assertions made by other owners in the strata scheme about his motivations are false as he has always been more than happy to leave the administration of the strata company to others. However, he requires that those who administer the strata company must do so according to the law.
[14] Above n 2 at page 11.
I start by considering the nature of the dispute before I turn to consider the conduct of the parties all of which are relevant considerations in the exercise of the Tribunal's discretion to make an order for costs.

Nature of the dispute

A relevant consideration to the Tribunal's exercise of its discretion to make an order for costs, is the nature of the dispute. In considering the nature of the dispute this will entail a consideration of the history of the dispute as well as the complexity of the dispute.
Mr Clay's application was essentially a challenge to the validity of the notice for, and the 2023 AGM. In the substantive decision at [141] I stated that, in my view, Mr Clay opportunistically seized on an irregularity or non-compliance with a requirement in respect of the notice concerning item 4 (election of council) to seek to invalidate the notice and the entire 2023 AGM in circumstances where he did not challenge the election of council at the extraordinary general meeting called the previous month in compliance with orders made by the Tribunal (differently constituted) in the previous proceeding CC 1099 of 2023.
Further, I came to the view, as stated in the substantive decision at [130], that the whole proceeding in the Tribunal could have been avoided had Mr Clay informed the council of his concerns with item 4 in the 14 days leading up to the 2023 AGM.
The application for which costs is sought by the strata company follows on from what Mr Clay refers to as the 'intractable disagreements' between the parties. In the previous proceeding CC 1099 of 2023, Mr Clay sought orders to:
(a) invalidate the election of the council;
(b) invalidate the AGM held on 1 October 2022 (2022 AGM); and
(c)invalidate resolutions passed at the 2022 AGM as well as at the meetings held by the council (see the substantive decision at [7] to [11]).
The strata company, understandably, is concerned that it has to deal with Mr Clay's recurring history of commencing applications in the Tribunal and his unwillingness to accept the decisions of the majority of the members of the strata company or other members which do not align with his views (using words of Mr Pearce, Ms Della-Vedova and Ms Metzger as set out in the substantive decision at [303]).
Further, by reference to Ms Metzger's statement filed on 17 July 2024 (see the substantive decision at [302]) where she stated that Mr Clay does not attempt to resolve matters with the members of the council but instead uses proceedings in the Tribunal to 'press his point of view', it was entirely appropriate and necessary for the strata company to participate in the hearing and to defend its position.
When the nature of the dispute is considered in light of the history between the parties, it was entirely appropriate, in my view, for the strata company to participate in the final hearing, to put forward and to defend its position with the assistance of legal representation. The ultimate result, where Mr Clay was unsuccessful on all issues (where an order was made by the Tribunal), supports the position that it was entirely appropriate for the strata company to participate in the hearing and have legal representation to defend its position.
In addition, the strata company incurred costs to deal with Mr Clay's interim applications including where Mr Clay sought to stay recovery proceedings against him, to vacate orders made by the Tribunal on 16 April 2024 and to have documents provided to him by way of discovery. The strata company also had to deal with Mr Clay not filing his book of documents and list of witnesses to be called to give evidence at the final hearing until 10 July 2024 (rather than by 10 June 2024).
In summary, while the whole proceeding in the Tribunal could have been avoided as stated earlier (see above at [48]), it was entirely appropriate in this case where there is a history of 'intractable disagreements' between the parties for the strata company to participate in the hearing to defend its position and to do so with legal representation.

Conduct of the parties

The conduct of the parties to the proceeding is also a relevant consideration to the Tribunal's exercise of its discretion to make an order for costs.
Mr Clay is self-represented and is self-described as a non-practising lawyer.
The strata company engaged legal representation after the conclusion of the mediation sessions in March 2024.
Mr Clay acknowledges that he did not comply with the orders of the Tribunal of 16 April 2024 (by not filing his book of documents and list of witnesses by the due date) and thereby caused a delay in the proceeding. However, Mr Clay contends that his delay was caused by the strata company's refusal to document their case on one of the issues in the current proceeding, and therefore, in his view, the strata company is in breach of the orders of 16 April 2024.
In my view, Mr Clay's conduct in not filing his book of documents when required by 10 June 2024, caused the strata company unnecessary cost and cut short the time available for the strata company to review the materials and to prepare its book of documents, list of witnesses and witness statements.
Further, Mr Clay asserts that while the strata company in correspondence with him undertook not to pursue a position alluded to in their book of documents at the final hearing, he says that he has too often seen such undertakings not complied with and then the Tribunal not enforcing such undertakings. In the view of Mr Clay, that was a real possibility in this case if he did not insist on compliance with the orders of 16 April 2024. Mr Clay states, as he saw it, he had no alternative and that the position was forced upon him by the strata company.[15] In my view, this position put forward by Mr Clay is unreasonable in circumstances where counsel for the strata company wrote to Mr Clay setting out its position and thereby seeking to avert the hearing on the interim application.
[15] Above n 2 at page 14.
In the previous proceeding CC 1099 of 2023, the parties resolved their dispute at a compulsory conference, however, Mr Clay without leave of a judicial officer of the Tribunal sought to reagitate or reventilate some matters in that proceeding in the current proceeding (see the substantive decision at [175]). That, in my view, incurred unnecessary legal costs for the strata company to defend its position.
Mr Clay rejects all aspersions made against him because, in his view, the history of proceedings before the Tribunal and the records show that his 'approach in all these matters has been to attempt to resolve the matters by conferral both before proceedings to avoid the need to commence proceedings entirely, and after commencement to resolve them expeditiously and with minimal expense'.[16] In the current proceeding, Mr Clay states that he followed the same approach, but the strata company had no desire to confer or engage in a genuine mediation with him. Mr Clay believes that he made every effort possible that could be utilised to avoid, avert or minimise the costs of the proceeding including:[17]
•Seeking to resolve the issues at the general meeting and immediately following the general meeting - efforts that were all rejected by council members;
•Seeking to resolve the issues at mediation, at first opposed by the [strata company] and then ultimately terminated by the [strata company]; and
•Inviting the [strata company] at directions hearings to re-enter mediation processes or external mediation, all rejected.
[16] Above n 2 at pages 1 and 13.
[17] Above n 2 at pages 13 to 14.
As explained in the following paragraphs, Mr Clay's conduct in the proceeding has not been to avoid, avert or minimise the costs to the parties.
In my view, Mr Clay's conduct impaired the attainment of the Tribunal's objectives to have the proceeding determined fairly and in accordance with the substantive merits, with as little formality and technicality as possible, and in a way which minimises the costs to the parties. As stated earlier (see above at [48]) and repeated here, that the whole proceeding in the Tribunal could have been avoided had Mr Clay informed the council of his concerns with item 4 in the 14 days leading up to the 2023 AGM. The consequence of Mr Clay's conduct in the current proceeding has unnecessarily incurred costs for the strata company and in doing so Mr Clay impaired the attainment of the Tribunal's objectives for the following reasons.
First, Mr Clay failed to comply with the orders of 16 April 2024 to file his book of documents and list of witnesses by 10 June 2024. Mr Clay eventually filed them on 10 July 2024 thereby limiting the time for the strata company to consider the documents and file its further bundle of documents and witness statements just two days before the final hearing.
Second, the second interim application unnecessarily compelled the strata company to seek to strike it out in circumstances where counsel for the strata company had informed Mr Clay and the Tribunal that such application was not necessary on the basis that words in the strata company's response could be struck out. Had Mr Clay accepted the letter from counsel for the strata company, time and costs would have been saved without the need for a hearing to determine the interim application.
Third, the third interim application unnecessarily incurred costs for the strata company as Mr Clay had refused to make an application to access the strata records under s 107 of the ST Act. Again, Mr Clay's conduct caused unnecessary cost to the strata company.
Fourth, Mr Clay sought to reagitate or reventilate matters dealt with in the previous proceeding CC 1099 of 2023 without first being given leave to do so by a judicial member of the Tribunal. This caused the strata company to incur unnecessary legal costs to defend its position.
Finally, while Mr Clay asserts that he is happy to leave the administration of the strata company to others provided that they do so according to the law, in my view, he continues to take exception to the council and without any reflection, he continues to make applications to the Tribunal because of what he describes as the 'intractable disagreements'.
All of the above, supports the position of the strata company that Mr Clay continues to seek to 'control' the strata company and in doing so, has deliberately and capriciously perpetuated the storm that has embroiled the owners of the strata company in the successive proceedings in the Tribunal and thereby has demonstrated no remorse or care for the financial and emotional strain the proceedings have inflicted on the other owners in the strata scheme who Mr Clay has 'left to drown in his wake'.[18] It was therefore, in my view, entirely appropriate for the strata company to have legal representation to defend its position in the current proceeding.
[18] Above n 4 at page 16.
In regards to the strata company, the Tribunal has had occasion to consider requests for extension of time to comply with orders. This was in respect of:
(a)its SIFC, book of documents and list of witnesses where the Tribunal granted an extension of four days to 31 May 2024; and
(b)its final written closing submissions where the Tribunal granted an extension of one day to 13 August 2024.
Following the granting of leave by the Tribunal for Mr Clay to file his book of documents and list of witnesses by 10 July 2024 (as he failed to file by 10 June 2024), the Tribunal made orders extending the time for the strata company to file further documents and witness statements to 17 July 2024 which was just one week after Mr Clay was required to file his documents and just two days before the final hearing.
In summary, in my view, the strata company complied with all orders of the Tribunal in a timely manner and thereby assisted the Tribunal achieve its objectives as set out in s 9 of the SAT Act. In the circumstances, I am satisfied and find the strata company acted reasonably in its conduct in the current proceeding.

Exercise of discretion

As already stated, and repeated here, in assessing costs, the Tribunal takes a relatively broadbrush approach as a matter of impression and without any attempt at mathematic precision. In doing so, the costs awarded are compensatory and not punitive.
In assessing what is fair and reasonable as to the amount of costs, if any, to be awarded to the strata company, I have had regard to:
(a)the written submissions made by counsel for the strata company;
(b)the written submissions opposing any order for costs made by Mr Clay;
(c)the nature of the dispute;
(d)the conduct of the parties in the current proceeding; and
(e)the substantive decision where Mr Clay was ultimately unsuccessful in all issues (where the Tribunal made a declaration and/or an order).
Mr Clay's contention that there ought to be no order for costs on the basis that the Tribunal made orders in the exercise of its discretion rather than on the basis of a finding that 'his claims were not valid'[19] is misguided in my view. This is because the decision in Western Australian Planning Commission v Questdale Holdings Pty Ltd [2016] WASCA 32 at [49] to [62] sets out the factors (non-exhaustive) to be considered when deciding whether or not to exercise the Tribunal's discretion under s 87(2) of the SAT Act to make a costs award for a party seeking its costs. The factors include the nature of the dispute, which in this case required the Tribunal to intervene to resolve the scheme dispute between parties with what Mr Clay refers to as the 'intractable disagreements', the conduct of the parties in connection with the proceeding and whether that conduct has impaired the attainment of the Tribunal's objectives as set out in s 9 of the SAT Act including minimising the costs of the parties.
[19] Above n 4 at page 1.
For each of the issues raised (issues one to six) in Mr Clay's application, findings were made, and as stated by Mr Clay, some findings were beneficial to both parties,[20] then bearing in mind the findings, as Mr Clay's application was an application made under s 197(4) of the ST Act to resolve the scheme dispute, declarations and/or orders were made by the Tribunal to resolve the scheme dispute.
[20] Above n 4 at page 5.
In coming to a conclusion in the exercise of the Tribunal's discretion to award costs, I am mindful that what was sought by way of costs by the strata company is not the full legal fees incurred but rather the legal fees claimed have been limited to the amounts set out in the Legal Profession (State Administrative Tribunal) Determination 2022 with erratum (1 July 2022 to 30 June 2024) and the Legal Profession (State Administrative Tribunal) Determination 2024 (1 July 2024 onwards).
It is submitted by counsel for the strata company that Mr Clay's original application and interim application were entirely unmeritorious and that had Mr Clay been acting in good faith, rather than acting on other motivations, the strata company would have been spared the substantial expense of legal costs and disbursements incurred in relation to the current proceeding.
Ultimately, Mr Clay was unsuccessful in the current proceeding. However, the mere fact that Mr Clay failed in his application on all contentions advanced at the final hearing (apart from issue 8 which by consent of the parties, the Tribunal set out the proper construction of Sch 1 by-law 17 - debt recovery costs) does not, by itself, signify that he acted inconsistently with the objectives of the Tribunal as set out in s 9 of the SAT Act.
In my view, My Clay's conduct in the proceeding did impair the attainment of the Tribunal objectives to have the proceeding determined fairly and in accordance with the substantial merits, with as little formality and technicality as possible and in a way which minimises the costs to the parties as set out above at [64] to [69] and for the following reasons.
First, in relation to issues one and two concerning the notice of the 2023 AGM and the resolution of the 2023 AGM, I expressed the view in the substantive decision at [110] and [128] to [130] that the current proceeding could have been avoided had Mr Clay informed the council of his concern with the wording or content of item 4 in the 14 days prior to the 2023 AGM. I then went on to state at [141] of the substantive decision that when considering whether to exercise the Tribunal's discretion to make declarations and orders that the Notice and the 2023 AGM are invalid that while Mr Clay feels that he is well intended in his application under s 197(4) of the ST Act that he opportunistically seized on an irregularity or non-compliance with a requirement with respect of the notice concerning item 4 to seek to invalidate the notice and the entire 2023 AGM. This was in circumstances where Mr Clay did not dispute the 2023 EGM or the result of the EGM being the election of council in compliance with order 1 of the orders made by the Tribunal (differently constituted) in the previous proceeding CC 1099 of 2023. In conclusion, in deciding to exercise the Tribunal's discretion to make orders, at [155] I noted that in circumstances where the strata company had endeavoured to comply with the orders of the Tribunal (differently constituted) to hold a meeting for the election of a council, the declarations and orders made in favour of the strata company signals disapproval of Mr Clay's conduct to opportunistically seize on an irregularity or non-compliance with a requirement in respect of the notice.
Second, in relation to issue 3, in the substantive decision at [175], I stated that it was not open for Mr Clay to reagitate or reventilate the matters set out in the previous proceeding CC 1099 of 2023 without leave of a judicial officer of the Tribunal because, apart from orders 1 and 2, the previous proceeding was otherwise dismissed. By Mr Clay pursuing his position in relation to issue 3, the strata company incurred unnecessary legal costs including in relation to the preparation of a response and attendance by the legal representative at the directions hearing held on 1 July 2024. Ultimately, I made orders in favour of the strata company.

Third, for issue 4, where Mr Clay challenged the financial accounts for the year ended 30 September 2023, asserting that they had to be redone or corrected to reflect amongst other items, bank balances, I concluded that while Mr Clay considers that he has the knowledge and skills to review and correct the financial accounts, the council had not delegated their functions in relation to the administration and financial management of the strata company to Mr Clay, who is not a member of the council. Again, Mr Clay's conduct and assertions caused the strata company to incur costs unnecessarily to defend its position.
Fourth, in relation to issue 5, I concluded in the substantive decision at [215] that in circumstances where Mr Clay is not elected a member of the council, that he acted without any authority to present and to circulate to the owners in the strata scheme alternative financial statements of the strata company. Further, in relation to issue 6, where Mr Clay challenged resolution 12 concerning the amount of levy contributions, I concluded at [227] that Mr Clay focused on the bank account balance, the current liabilities and expenditure proposed for the next twelve months but failed to consider long-term liabilities (Lannock Finance loans) or the need to increase the reserve fund for future maintenance and repair work. Again, Mr Clay's conduct in relation to these issues caused the strata company to incur costs unnecessarily to defend its position.
Fifth, for issue 7 concerning Mr Clay's practice, where he is not a member of the council, of emailing owners proposed resolutions outside of a general meeting, I concluded in the substantive decision at [263] to [264] that the role of dealing with proposed resolutions outside of a general meeting is with the council and to create certainty for the strata company and reduce disputes between the parties, I made an order requiring Mr Clay to refrain from issuing proposed resolutions (by email or otherwise) outside of a general meeting. The conduct by Mr Clay again has caused the strata company to incur costs unnecessarily to defend its position.
Sixth, in relation to the fourth interim application, which was filed after the final hearing, the strata company had to again incur unnecessary costs to reply to the interim application which clearly went beyond the current proceeding in the Tribunal.
The strata company presented four invoices totalling $52,788.25 after adjustment and discount, in relation to the current proceeding as follows:
(a)Invoice 96 dated 28 June 2024 after adjustment and discount totals $23,573;
(b)Invoice 109 dated 25 September 2024 after adjustment and discount totals $23,537.25;
(c)Invoice 114 dated 2 December 2024 and totals $2,178; and
(d)Invoice 116 dated 2 December 2024 and after discount totals $3,500.
Counsel for the strata company submits the costs were incurred on the basis of the relevant solicitor's hourly fee rate of $440 less substantial discounting of time spent based on proportionality and reasonableness having regard to the nature of the dispute and the 'hapless position in which the [strata company] had been placed by [Mr Clay] in responding to his application',[21] and 'having regard to the breadth and substance of Mr Clay's complaints [and] the extent of irrelevant information submitted and relied on' by Mr Clay.[22]
[21] Above n 4 at page 13.
[22] Above n 4 at page 14.
The strata company seeks to be compensated for costs fixed at $52,788.25 (after adjustment and discount applied per the four invoices) being the total party/party costs incurred in the proceeding. It is the belief of the strata company that the costs sought result directly from Mr Clay's obsessive pursuit for 'control' of the council functions and decisions.[23]
[23] Above n 4 at page 16.
Counsel for the strata company submits that an award of costs is the only way that Mr Clay will experience and understand that there are consequences to his actions, and hopefully, accept that the past has happened, that he needs to learn from those past events, and that it is now imperative that he moves on in the interests of all of the members of the strata company.[24]
[24] Ibid.
In my view, the legislative purpose of the SAT Act will be served by the strata company receiving its reasonable costs. Taking a relatively broadbrush and pragmatic approach looking at the circumstances or the realities of this case and as a matter of impression without any attempt at mathematical precision, I am satisfied for all of the reasons set out above, that a total amount fixed in the amount of $30,000 ought to be recovered by the strata company from Mr Clay.

Conclusion

In conclusion, having regard to the objectives of the Tribunal and in the interests of justice, in my view, it is fair and reasonable, for the reasons set out above, that Mr Clay be required to pay to the strata company costs fixed in the amount of $30,000 pursuant to s 87(2) of the SAT Act within 30 days of these orders, or as otherwise agreed in writing by Mr Clay and the strata company.

Orders

The Tribunal orders:
1.Pursuant to s 87(2) of the State Administrative Tribunal Act 2004 (WA), the applicant must pay costs fixed in the amount of $30,000 to the respondent to be paid within 30 days of these orders or some other timeframe as agreed in writing by the applicant and the respondent.

I certify that the preceding paragraph(s) comprise the reasons for decision of the State Administrative Tribunal.
MS R PETRUCCI, MEMBER
11 FEBRUARY 2025