J CORP PTY LTD and CHUDY
[2008] WASAT 79 (S)
•17 OCTOBER 2008
| JURISDICTION | : | STATE ADMINISTRATIVE TRIBUNAL |
| STREAM | : | COMMERCIAL & CIVIL |
| ACT | : | BUILDERS' REGISTRATION ACT 1939 (WA) |
| CITATION | : | J CORP PTY LTD and CHUDY [2008] WASAT 79 (S) |
| MEMBER | : | MR C RAYMOND (SENIOR MEMBER) |
| HEARD | : | 15 OCTOBER 2007 |
| DELIVERED | : | 10 APRIL 2008 |
| SUPPLEMENTARY | ||
| DECISION | : | 17 OCTOBER 2008 |
| FILE NO/S | : | CC 413 of 2007 |
| BETWEEN | : | J CORP PTY LTD Applicant |
| AND | ||
| JOZEF CHUDY SHIMI MARIA CHUDY Respondents | ||
| Catchwords: |
Application by respondent for costs - Leave to review decision of Building Disputes Tribunal dismissed - Reviewable error established - No substantial injustice found on decisive issue not raised by respondent
Legislation:
| Builders Registration Act 1939 (WA) State Administrative Tribunal Act 2004 (WA), s 87(1), s 87(2) | [2008] WASAT 79 (S) |
| Result: | |
| Application for costs dismissed | |
| Category: B | |
| Representation: | |
| Counsel: |
| Applicant | : | Mr A MacPherson |
| Respondents | : | Mr R Shaw |
Solicitors:
| Applicant | : | Hotchkin Hanley |
| Respondents | : | Lavan Legal |
Case(s) referred to in decision(s):
J & P Metals Pty Ltd and Shire of Dardanup [2006] WASAT 282 (S)
J Corp Pty Ltd and Chudy [2008] WASAT 79
Lai and Costa [2006] WASAT 116 (S)
Rainbow Pty Ltd and Hawkins [2007] WASAT 216 (S)
[2008] WASAT 79 (S)
REASONS FOR DECISION OF THE TRIBUNAL:
Summary of Tribunal's decision
1 The respondent sought an award of legal costs of $8,870 incurred in
opposing the applicant's application for leave to review a decision of the
Building Disputes Tribunal.2 The State Administrative Tribunal concluded that the recoverable
costs, if costs were awarded, were of borderline significance when considered against the benefit obtained by the preservation of the order of the Building Disputes Tribunal which was for payment of compensation of $100,000.
3 Although the matter was complex and it was necessary for the
respondents to obtain legal representation to properly oppose the application, a significant factor in the exercise of the State Administrative Tribunal's discretion was that leave to review the decision would have been granted, but for adverse findings made by the State Administrative Tribunal on issues which were not raised by the respondents. Further, there were a number of aspects of the decision of the Building Disputes Tribunal which were cause for concern so that the commencement of proceedings by the applicant was justified. It was obvious to the State Administrative Tribunal that the applicant had incurred significantly higher costs than the respondents.
4 Taking all factors into account, the State Administrative Tribunal
concluded that the most appropriate outcome was that each party should bear its own costs and the respondents' application for costs was accordingly dismissed.
The application for costs
5 On 10 April 2008 the Tribunal delivered written reasons for decision
refusing the applicant's (builder) application for leave to review a decision of the Building Disputes Tribunal; see J Corp Pty Ltd and Chudy [2008] WASAT 79. The respondents (the owners) have applied for the costs of opposing the application for leave in an amount of $8,870.
The parties have filed written submissions in support and in opposition to the application, respectively.
[2008] WASAT 79 (S)
Conclusion
For the reasons which follow, the application for costs should be
dismissed.
8 In Lai and Costa [2006] WASAT 116 (S) and Rainbow Pty Ltd and Hawkins [2007] WASAT 216 (S) (Rainbow Pty Ltd and Hawkins), the Tribunal set out a number of factors relevant to the consideration of whether or not to award costs in relation to proceedings for the review of a decision of the Building Disputes Tribunal under the Builders Registration Act 1939 (WA) (BR Act). The starting point in relation to an application for costs is that each party should bear their own costs in accordance with s 87(1) of the State Administrative Tribunal Act 2004 (WA) (SAT Act). However, there is a broad discretion to award costs as provided for under s 87(2) of the SAT Act and the above decisions acknowledge that a relevant factor in considering the award of costs is that it would not be in the public interest if the cost of legal representation and expert witness fees could not be recovered in some cases, because of the effect that might have on limiting the use of the Building Disputes Tribunal. It is also relevant that there will be cases where the nature of the case are such that legal representation is necessary.
9 However, where the costs incurred are relatively incidental to the
benefit obtained from the proceeding, that may be a sufficient basis to
decline to make any award of costs in favour of a party.10 It is of course necessary, by reason of the provisions of s 87(4) of the
SAT Act, for the Tribunal to have regard to whether a party genuinely attempted to enable and assist the decision-maker to make a decision on its merits.
11 In Rainbow Pty Ltd and Hawkins the Tribunal also outlined the basis upon which the Tribunal would assess the costs to which a party might be entitled, following the principles stated by Deputy President Chaney in J & P Metals Pty Ltd and Shire of Dardanup [2006] WASAT 282 (S). As the costs incurred by the owners are a factor featuring significantly in the Tribunal's consideration of the matter, it is convenient to deal with this aspect first. The owners have provided no detail of the basis on which the $8,870 is claimed; that is, by reference to time spent in attendance at directions hearings, preparation and getting up, or attendance at the hearing. All that is provided is a statement that the amount claimed represents 7.1 hours work by junior practitioners, charged at a rate of $253 per hour, and 19.5 hours work by a senior practitioner, charged at $363 per hour.
[2008] WASAT 79 (S)
12 There is no prescribed scale in relation to the conduct of proceedings
before the Tribunal but regard can be had to statutory scales as a guide. The Legal Practitioners (District Court Appeals) (Contentious Business) Report and Determination 2006 provides the District Court Appeal Scale of costs (the District Court Appeal Scale). The District Court Appeal Scale provides some guidance in relation to the subject proceedings. However, the District Court Appeal Scale deals only with an appeal, whereas proceedings in this Tribunal in applications to review and the review of Building Disputes Tribunal decisions require a combination of that process, with an application for leave, and a merits review, which in some instances may require a substantial body of new evidence. The District Court Appeal Scale allows relevantly $1,243 for proceedings in chambers, $1,243 for getting up the appeal for hearing, and counsel's fee on hearing, including preparation, of up to $4,356.
13 In the absence of any details of the time taken and costs charged for
relevant activities, based on the Tribunal records and documents filed on
record, I would assess the recoverable costs, if awarded, as set out below:
| 1. | 4 directions hearings @ $150 each | $600 |
| 2. | Drafting submissions in opposition to leave: | |
| - 3 hours (junior practitioner) @ $250/hour | ||
| - 1 hour (senior practitioner) @ 360/hour | $110 | |
| 3. | Getting up: | |
| - 4 hours (senior practitioner) @ $360/hour |
- 3 hours (junior practitioner) @ $250/hour $2,190
4. Hearing:
- 3.5 hours (senior practitioner) @ $360 $1,260
5. Supplementary submissions:
- 1.5 hours (junior practitioner) @ $250
- 7.5 hours (senior practitioner) @ $360 $645
6. Submissions on costs:
- .5 hour (junior practitioner) @ $250 $125
$5,930
[2008] WASAT 79 (S)
14 The above costs weighed against the benefit of preservation of the
order made by the Building Disputes Tribunal for payment of damages of $100,000 can be considered as being on the border of a significant amount.
15 The Tribunal accepts that due to the complexity of the matter, the
owners could not have properly conducted these proceedings without legal representation. Further, there is nothing to suggest that the owners did anything other than genuinely attempt to enable and assist the Building Disputes Tribunal to determine the matter. In the absence of the further factors, referred to below, the Tribunal would be inclined to award costs.
16 In this case the Tribunal made a number of findings reflecting
aspects of the Building Disputes Tribunal's decision which were either wrong, or attended with sufficient doubt as to meet those particular criteria necessary for the grant of leave. Significantly, the Tribunal accepted that cl 7.5 of the building contract entered into between the parties arguably excluded reliance on the representation on which the Disputes Tribunal based its finding of the existence of an estoppel which precluded termination of the contract. The only reason that leave was not therefore granted was because the Tribunal also found that the builder had no common law or contractual right to terminate the contract. That conclusion was reached only because the Tribunal raised the issues and called for further submissions, after the substantial hearing of the matter, in order to enable it to discharge its obligation to determine the substantial merits of the matter. Based on that conclusion, the Tribunal found that no substantial injustice would result from the refusal of leave. The builder, who had had the carriage of the matter, has filed extensive submissions and it is obvious to the Tribunal that the builder will have incurred significantly more costs than the owners. There were a number of aspects of the decision of the Building Disputes Tribunal which were cause for concern and although the application for leave ultimately failed, the proceedings were certainly justified.
17 Having regard to all of the above factors and circumstances, and
having regard to the marginal significance of the costs potentially recoverable weighed against the preservation of the Building Disputes Tribunal's order, the Tribunal concludes that the most appropriate outcome is that each party should bear their own costs. That outcome will result from a decision to dismiss the owners' application for costs.
[2008] WASAT 79 (S)
Order
For the above reasons, the Tribunal will issue an order:
1. The respondents' application for costs is dismissed.
I certify that this and the preceding [18] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
___________________________________
MR C RAYMOND, SENIOR MEMBER
0
0
8