| JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL STREAM : COMMERCIAL & CIVIL ACT : BUILDING SERVICES (COMPLAINT RESOLUTION and ADMINISTRATION) ACT 2011 (WA) CITATION : HOSKINS and DANIEL VINCI T/As D'VINCI CONTRACTING [2011] WASAT 188 MEMBER : MR C RAYMOND (SENIOR MEMBER) HEARD : 11 NOVEMBER 2011 DELIVERED : 24 NOVEMBER 2011 FILE NO/S : CC 1308 of 2011 BETWEEN : JOHN HOSKINS MICHELLE HOSKINS
Applicants
AND
DANIEL VINCI T/As D'VINCI CONTRACTING
Respondent
Catchwords: Building Services (Complaint Resolution and Administration) Act 2011 (WA) Application for costs Principles to be applied Legislation: Builders Registration Act 1939 (WA), s 41
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Building Services (Complaint Resolution and Administration) Act 2011 (WA), s 49
Rules of the Supreme Court (WA), r 66(1)
State Administrative Tribunal Act 2004 (WA), s 9, s 87, s 87(1)
Supreme Court Act 1935 (WA), s 66
Interpretation Act 1984 (WA), s 18 Result: Application successful in part Category: B
Representation: Counsel:
Applicants : In person
Respondent : Ms Hunter (Acting as Agent)
Solicitors:
Applicants : N/A
Respondent : N/A
Case(s) referred to in decision(s):
Cachia v Hanes & Anor (1994) 179 CLR 403
Clifford and Shire of Busselton [2007] WASAT 89 (S)
Duke Eastern Gas Pipeline Pty Ltd (2001) ATPR 41 - 827
Lai & Anor and Costa [2006] WASAT 117 (S)
Marvelle Investments Pty Ltd and Argyle Holdings Pty Ltd [2010] WASAT 125 (S)
Motor Vehicle Industry Board and Dawson [2006] WASAT 8
Pearce & Anor and Germain [2007] WASAT 291 (S)
Western Australian Planning Commission and Shim [2007] WASAT 262 (S)
Western Australian Planning Commission v Dungey [2010] WASC 52
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REASONS FOR DECISION OF THE TRIBUNAL:
Summary of Tribunal's decision 1 The applicants' complaint in relation to building work originally made to the Building Disputes Tribunal was referred to the State Administrative Tribunal under the Building Services (Complaint Resolution and Administration) Act 2011 (WA). The substantive complaint was settled at a directions hearing save in respect of costs. The applicant applied for costs against the respondent. 2 The Tribunal considered the effect of the cost provisions set out under s 49 of the Building Services (Complaint Resolution and Administration) Act 2011 and the effect which those provisions had on the Tribunal's usual costs regime applying under s 87 of the State Administrative Tribunal Act 2004 (WA). The former provisions provided the Tribunal with a discretion to order such costs as it thought fit whereas the latter provisions, unless otherwise specified in the State Administrative Tribunal Act 2004 or the enabling Act requires that each party bears its own costs. 3 The Tribunal outlined that s 49 of the Building Services (Complaint Resolution and Administration) Act 2011 must be construed having regard not only to its statutory context but also taking into account its purpose to apply to and govern the manner in which the Tribunal is to exercise its powers in relation to its jurisdiction in building matters. As the provision applies to a Tribunal which has been specifically established with particular objectives and procedures designed to provide an informal, inexpensive and flexible means of resolving disputes, it should be construed in a manner which promotes those objectives and procedures. The Tribunal referred to authority that even a broad costs discretion will be read down if inconsistent with the purposes of a tribunal. 4 The Tribunal referred to its statutory objectives which included that it act speedily and with as little formality and technicality as practicable and to minimise the costs to the parties, and concluded that the new costs provisions should not be understood as providing that costs will generally follow the result because that would be inconsistent with the Tribunal's objectives and procedures. The Tribunal concluded that the provisions gave the Tribunal the broadest possible discretion in relation to costs and should be regarded as being entirely neutral in effect, but should be applied in a manner which is consistent with and reinforces the objectives and procedures of the Tribunal. In the exercise of that discretion all of the considerations identified in earlier decisions of the Tribunal on costs (Page 4)
remained relevant. However, those considerations are not exhaustive and any other factors will be relevant which point to the justice of the case requiring an award of costs. 5 The Tribunal then dealt with the merits of the costs application and awarded only a portion thereof in relation to the costs of obtaining an independent expert report. Other claims for costs were not allowed having regard to the particular facts. The claim for lodgement fees was disallowed on the basis that the cost was incidental having regard to the substantial benefit obtained by the applicants in the proceedings.
The proceedings and application for costs 6 The applicants (owners) lodged two complaints against the respondent (contractor) with the Building Disputes Tribunal. The first complaint was lodged on 30 September 2010 and the second on 3 February 2011. The complaints related to different aspects of work undertaken by the contractor in relation to the installation of fencing and retaining walls on the owners' property at Clifton Park, Bunbury. Those complaints have been resolved and the only matter in issue is whether the owners should be entitled to an award of costs. 7 The uncontradicted evidence of the owners is that they were informed by the Building Disputes Tribunal that there would be a significant delay if they waited for a Builders' Registration Board inspector to carry out an inspection of the alleged faulty and unsatisfactory building work and that they were encouraged to obtain their own independent report, which they proceeded to do. They obtained that report from a building consultant, Independent Building Inspections, on 20 January 2011. The contractor declined to accept the findings that a portion of the work had constituted poor workmanship and consequently the owners had to wait for a report to be prepared by an inspector of the Builders' Registration Board. That report was provided on 23 June 2011 and was favourable to the owners in a number of respects. The inspector recommended that two complaints relating to whether the fence failed to follow the boundary line and whether a retaining wall had been constructed in the neighbour's property be referred to the Building Disputes Tribunal. 8 The Building Services (Complaint Resolution and Administration) Act 2011 (WA) (BS(CRA) Act) came into effect on 29 August 2011 and pursuant to its provisions the matter was referred by the newly established Building Commission to this Tribunal. Directions hearings were held on 5 October 2011 and 25 October 2011 as a result of which the matter was (Page 5)
settled. On the latter date the Tribunal issued a building remedy order by consent in terms of which the contractor is required to carry out agreed remedial action in respect of all complaints. The owners requested that they be awarded costs and directions were made requiring a written application to be made which was listed for hearing on 11 November 2011. That application was duly made and in terms thereof the owners seek to recover costs as follows: 1) $825 in respect of survey costs. 2) The cost of the initial Independent Building Inspections' report of $220. 3) The cost of a further Independent Building Inspections' attendance of $220 said to be required pursuant to the Tribunal's order of 5 October 2011. 4) Travelling expenses of $66. 5) A claim for loss of shrubs and plants of $50. 6) The cost of lodging the building disputes complaint of $32. 9 At the conclusion of the oral hearing of the costs application the Tribunal indicated its intention that only the costs of the initial Independent Building Inspections' report of $220 would be awarded and that, because no decision has been published dealing with an application for costs under the BS(CRA) Act, the decision would be reserved and then published in writing.
The applicable principles for the award of costs 10 Section 49 of the BS(CRA) Act provides as follows: Costs and expenses (1) Subject to this section, the Building Commissioner or the State Administrative Tribunal may make such orders for costs as they think fit in relation to proceedings arising from a building service complaint or a HBWC complaint. (2) The Building Commissioner must not award costs to a party for the services of a representative of that party unless, in the opinion of the Building Commissioner, it is fair to do so, having regard to (Page 6)
(a) whether a party has acted in relation to a complaint in a way that unnecessarily disadvantaged another party; or (b) whether a party has been responsible for prolonging unreasonably the time taken to deal with the complaint; or (c) the relative strengths of the claims made by each of the parties; or (d) any other matter the Building Commissioner considers relevant. … 11 The power for the Tribunal to award costs expressed above represents a departure from the provisions for the award of costs under the State Administrative Tribunal Act 2004 (WA) (SAT Act). Section 87 of the SAT Act provides: Costs of parties and others (1) Unless otherwise specified in this Act, the enabling Act, or an order of the Tribunal under this section, parties bear their own costs in a proceeding of the Tribunal. (2) Unless otherwise specified in the enabling Act, the Tribunal may make an order for the payment by a party of all or any of the costs of another party or of a person required to produce a document or other material on the application of the party under section 35. … 12 Consequently, the starting point when dealing with a costs application under s 87 of the SAT Act is that each party bears its own costs of a proceeding before the Tribunal. The Tribunal has shown a willingness to move away from that starting point in particular areas of its jurisdiction for a variety of reasons. These varying reasons are reflected in previous decisions of the Tribunal. For example, the successful party will usually recover costs in proceedings for compensation for compulsory acquisition of land (see: Clifford and Shire of Busselton[2007] WASAT 89 (S)and Western Australian Planning Commission and Shim[2007] WASAT 262 (S)). In Lai & Anor and Costa[2006] WASAT 117 (S) it was stated that in the review of decisions of the Building Disputes Tribunal under s 41 of the Builders Registration Act 1939 (WA) the costs of conducting the case might be allowed when the costs were such that an injustice would result by not allowing costs. However, as the costs in that case were regarded as incidental to the (Page 7)
review they were not allowed. In vocational matters where a vocational regulatory body is successful it will usually be entitled to recover costs: (see Motor Vehicle Industry Board and Dawson[2006] WASAT 8 at [44] [48]). 13 It has been recognised that there are a range of factors that might contribute to the Tribunal making a costs order, including the following nonexhaustive list: a) where a party conducts itself unreasonably, particularly where the conduct leads to unnecessary costs to the other party; b) where a party has conducted itself inappropriately, particularly where the conduct leads to unnecessary costs to the other party; c) where credibility of evidence is at the heart of a matter; d) where the application undermines the integrity of proceedings under the relevant Act; e) where the case is weak, being incredible or implausible or obviously unmeritorious; and f) where a party has to embark in proceedings to vindicate its clear contractual entitlement, all of which appears within the discussion in Pearce & Anor and Germain [2007] WASAT 291 (S) (Pearce) at [22] [24]. In Marvelle Investments Pty Ltd and Argyle Holdings Pty Ltd [2010] WASAT 125 (S) the Tribunal referred to the factors discussed in Pearce and clarified that its reasoning conveyed that there may be circumstances in which the justice of the case supports moving away from the initial position. 14 In each of the circumstances referred to above the Tribunal has identified that there is a basis for moving away from the starting position that each party bear its own costs. Under the BS(CRA) Act that initial predisposition against an award of costs has been removed. 15 Within the court system a discretion to award costs expressed in similar terms to that of the BS(CRA) Act has the consequence that a successful party is usually entitled to an award of costs (see: s 66 of the (Page 8)
Supreme Court Act 1935 (WA) and r 66(1) of the Rules of the Supreme Court (WA)). 16 The cost provisions set out in s 49 of the BS(CRA) Act must be construed having regard to not only its statutory context but taking into account its purpose to apply to and govern the manner in which the Tribunal is to exercise its powers in relation to its jurisdiction in building matters: (see Western Australian Planning Commission v Dungey[2010] WASC 52 at [27] and following). It applies to a tribunal which has been specifically established with particular objectives and procedures designed to provide an informal, inexpensive and flexible means of resolving disputes. While s 87(1) of the SAT Act requires that the provisions of s 49 of the BS(CRA) Act apply, the provisions should be construed in a manner which promote the objectives and procedures of the Tribunal because it is unconceivable that the purpose of the BS(CRA) Act would include any intention to change the fundamental basis upon which the Tribunal operates: s 18 of the Interpretation Act 1984 (WA). Even a broad costs discretion will be read down if inconsistent with the purposes of a tribunal: see Duke Eastern Gas Pipeline Pty Ltd (2001) ATPR 41 827 and the discussion in the Law of Costs,GE Dal Pont, LexisNexis Butterworths, Australia, 2003 at [6.19]. 17 The Tribunal is required by s 9 of the SAT Act to act speedily and with as little formality and technicality as is practicable and to minimise the cost to the parties. Those objectives would not be fostered by an approach that costs should follow the result as a general rule. In most cases in which parties are self-represented the only costs potentially recoverable will be lodgement fees, minor travelling costs and photocopying charges. Costs for the party's own time is not recoverable: see Cachia v Hanes & Anor (1994) 179 CLR 403. The ability of the Tribunal to deal with matters speedily will be compromised if time is taken up in dealing with applications for costs of this nature and hearing arguments over relatively low amounts. 18 There will be cases in which it will be appropriate to exercise a discretion to enable the successful party to recover all costs which may be properly recovered in proceedings before the Tribunal. Without in any way attempting to define the circumstances in which the discretion may be exercised in that way, such an outcome might be achieved in circumstances in which the successful party is legally represented and the complexity of the case required it to be prepared and presented in a more structured way than most building disputes coming before the Tribunal. Similarly, the Tribunal might more readily allow recovery of all (Page 9)
disbursements properly incurred where the total disbursements, usually relating to the costs of expert witnesses, are such that the costs represent a significant proportion of the monetary value of the relief obtained. In such cases the remedy granted by the Tribunal would not be truly effective if costs could not be recovered. These are the type of cases in which the justice of the case points to the need for costs to be awarded. At the other end of the scale, parties will always need to incur lodgement fees, travel costs and the cost of photocopying. It in no way furthers the objectives of the Tribunal to encourage or to have to entertain applications for such costs when they are really quite incidental to the benefit obtained from the proceedings. 19 Accordingly, s 49 of the BS(CRA) Act should not be understood as providing that costs will generally follow the result. It grants the Tribunal the broadest possible discretion in relation to costs and should be regarded as being entirely neutral in effect, but should be applied in a manner which is consistent with and reinforces the objectives and procedures of the Tribunal. In the exercise of that discretion all of the considerations identified above in relation to the exercise of the discretion under s 87 of the SAT Act remain relevant. Those considerations are however not exhaustive and any other factors will be relevant which point to the justice of the case requiring an award of costs.
Consideration of the costs claim 20 The principles identified above must be applied to a consideration of the costs claim. In addition, in this case, it is relevant to take into account that the contractor has sought to resolve the matter at the earliest possible stage in the proceedings before this Tribunal and that the owners have succeeded in obtaining effectively all the relief to which they may have been entitled if the matter had proceeded.
1) Survey costs $825 The contract terms as reflected in the quotation accepted by the owners contains a provision that boundaries must be clearly marked by the customer. The owners failed to do so. After the work had been completed and because of concerns about the quality of it and also encroachment into the neighbour's property, the owners caused a survey to be carried out. They have succeeded in obtaining orders in these proceedings which will rectify their complaints and the effect of that is to put them in the position they would have been in had they had the survey (Page 10)
carried out first and provided to the contractor. This claim is therefore not allowed.
2) Initial Independent Building Inspections' report $220 The owners were encouraged to obtain this report to facilitate the conduct of the proceedings before the Building Disputes Tribunal because of the anticipated delay in obtaining a report from an inspector of the Builders' Registration Board. It is accordingly fair that they should be able to recover this cost and the claim is allowed.
3) Further Independent Building Inspections' report $220 This cost was unnecessarily incurred. The Tribunal's order of 5 October 2011 reflected that the matter was adjourned to 25 October 2011 to enable the contractor to confer with the owners' building consultant. The owners took it upon themselves to arrange for the building consultant to attend at their premises which resulted in the costs now claimed. This course was followed without any arrangement being in place for the respondent to meet the building consultant at the premises. The claim is therefore disallowed.
4) Travelling expenses $66 This claim is in respect of the owners' fuel and parking costs in travelling from Bunbury to Perth to attend directions hearings. The Tribunal's notice of those hearings specifically offers teleconferencing or videoconferencing. The respondent took up the opportunity to attend by way of teleconference. The owners contended that they preferred to be in attendance because they considered it to be more effective. It was, however, not necessary for them to travel twice from Bunbury to Perth and, if they chose to do so when the matter was perfectly capable of being conducted by way of teleconference, then the cost of doing so should not fall upon the other party. That is particularly so in the circumstances of this case in which the respondent took the opportunity provided by the directions hearings to resolve the matter.
5) Loss of shrubs and plants $50 This is a claim for the loss of plants which were temporarily stored with the intention of being replanted after the complaint (Page 11)
had been resolved. This claim is not properly a claim for costs in the proceedings and no substantive claim of this nature was made. The claim is accordingly disallowed.
6) Building Disputes Tribunal lodgement fees $32 This is an incidental cost when regard is had to the substantial benefit obtained by the owners in these proceedings. In the circumstances this claim is also disallowed.
Conclusion and order 21 For the above reasons the only costs allowed to the owners and which they are entitled to recover against the contractor relate to the initial independent building consultant's report in the sum of $220 and an order will be made to that effect. 22 The Tribunal will accordingly cause an order to issue: 1. The respondent is to pay the applicants' costs in respect of the initial building consultant's report obtained by them in the sum of $220, such payment to be made within 21 days of the date of this order. |