Keevers v Sarraf Property Group Pty Ltd - [2022] NSWSC 1017

Supreme Court

New South Wales

Medium Neutral Citation: Keevers v Sarraf Property Group Pty Ltd [2022] NSWSC 1017
Hearing dates: 8 March 2022
Date of orders: 28 July 2022
Decision date: 28 July 2022
Jurisdiction: Common Law
Before: Harrison AsJ
Decision:
(1) Leave to appeal pursuant to s 83(1) of the Civil and Administrative Tribunal Act 2013 (NSW) is refused.
(2) The amended summons filed 26 October 2021 is dismissed.
(3) The stay orders made on 8 July 2022 in this Court are dissolved.
(4) The plaintiff is to pay the defendants’ costs.

Catchwords:
ADMINISTRATIVE LAW – NCAT Appeal – Leave to appeal – Whether the Appeal Panel erred in joining parties – Whether there was an injustice going beyond what was reasonably arguable – Whether there is an issue of principle or a question of public importance – Appeal dismissed

Legislation Cited:
Civil and Administrative Tribunal Act 2013 (NSW) ss 44, 80
Strata Schemes Development Act 2015 (NSW) Part 10
Strata Schemes Management Act 2015 (NSW) ss 86, 87, 237
to s 86 Strata Schemes Management Act
Uniform Civil Procedure Rules 2005 (NSW) r 6.19

Cases Cited:
Adam P Brown Male Fashions v Phillip Morris (1981) 148 CLR 170
Administration of Papua New Guinea v Daera Guba (1972) 130 CLR 353
Australian Railways Union v Victorian Railways (1971) 125 CLR 319
Be Financial Pty Ltd as Trustee for Be Financial Operations Trust v Das [2012] NSWCA 164
Browne v Dunne (1893) 6 R 67
Commissioner of Police, New South Wales Police Force v Fine [2014] NSWCA 327
Corcoran v Far [2020] NSWCA 140
Coulter v R [1988] HCA 3; 164 CLR 350
Fox v Percy (2003) 214 CLR 118; [2003] HCA 22
Glenquarry Park Investments Pty Ltd v Hegyesi [2019] NSWSC 1120
House of Spring Gardens Ltd v Waite [1991] 1 QB 241
House v The King [1936] HCA 40; 55 CLR 499
Huang v Attapallil & Ors [2017] NSWCA 181
Kuhl v Zurich Financial Services Australia [2011] HCA 11; (2011) 243 CLR 361
Lee v New South Wales Crime Commission (2012) 224 A Crim R 94; [2012] NSWCA 262
Macquane Developments Pty Ltd & Anor v Forrester & Anor [2005] NSWSC 674
Nana Ofori Atta II v Nana Abu Bonsra II [1958] AC 95 at 102
Nominal Defendant v Manning (2000) 50 NSWLR 139, [2000] NSWCA 80
Osborne v Smith (1960) 105 CLR 153
PPK Willoughby v Baird [2019] NSWCA 48
Rice Marketing Board for the State of New South Wales v Forbidden Foods Pty Limited; Forbidden Foods Pty Limited v Rice Marketing Board for the State of New South Wales [2020] NSWCATAP 182
Rosenberg v Percival (2001) 205 CLR 434; [2001] HCA 18
Tan v Owners Corporation Strata Plan 22014 (No 2) [2015] NSWSC 1920

Category: Principal judgment
Parties: Francis Keevers (Plaintiff)
Sarraf Property Group Pty Ltd (First Defendant)
Konn Palonis (Second Defendant)
Owners of Strata Plan 1813 (Third Defendant)
Peta Bourke (Fourth Defendant)
Joanna Fardell (Fifth Defendant)
Representation:
Counsel:
S. Philips (Plaintiff)
G. Sirtes SC (First, Second and Third Defendants)
Solicitors:
Terret Lawyers (Plaintiff)
Madison Marcus (First, second and Third Defendants)

File Number(s): 2021/237102
Publication restriction: Nil
Decision under appeal

Court or tribunal:

Civil and Administrative Tribunal of New South Wales

Jurisdiction:

Appeal Panel

Citation:

NSWCATAP 130

Date of Decision:

12 May 2021; 22 July 2021; 30 July 2021;

Before:

P Durack SC, Senior Member
D Robertson, Senior Member

File Number(s):

2020/00370815 (AP 20/23648)

Judgment

Background
The Appeal Panel
Events since the decision of the Appeal Panel

Grounds of appeal in this Court
Extension of time to appeal
Leave to appeal
The relevant statutory provisions
Strata Schemes Management Act
Civil and Administrative Tribunal Act

The Appeal Panel’s decision – joinder of parties
Appeal Grounds 1A, 1B and 1 – Joinder of parties
The plaintiff’s submissions
The defendant’s submissions

Consideration of Rice Marketing Board and Fine v Commissioner of Police
Rice Marketing Board
The defendant’s submissions on Rice Marketing
The plaintiff’s supplementary submissions on Rice Marketing
Resolution

Appeal Grounds (2)(a) – procedural fairness
The Appeal Panel’s decision

The plaintiff’s submissions
Appeal Ground 2(a) – procedural fairness

The defendant’s submissions
Resolution

Appeal Grounds 2(b)-(d) – findings of fact and evidence
The plaintiff’s submissions
The defendant’s submissions
Resolution

Appeal Ground 3 – an attack on the Appeal Panel’s findings that some first instance findings were infected with factual error
The plaintiff’s submissions
The defendants’ submissions
Resolution

Appeal Ground 4 – costs of the appeal
The plaintiff’s submissions
The defendants’ submissions
Resolution

Result
Costs
The Court orders:

Judgment

HER HONOUR: This matter involves an appeal from a decision of an Appeal Panel of the NSW Civil and Administrative Tribunal (“NCAT”).
By Amended Summons filed on 26 October 2021, the plaintiff appeals (and, to the extent necessary, seeks leave to appeal) two decisions of the Appeal Panel of the NSW Civil and Administrative Tribunal (NCAT Appeal Panel) dated 12 May, 22 July 2021 and a 30 June 2020 decision in relation to costs.
The plaintiff is Mr Francis Keevers. The first defendant is Sarraf Property Group Pty Ltd (“Sarraf Property Group”) which includes two Sarraf brothers, Mr Norman Sarraf and Mr John Sarraf. The second defendant is Mr Konn Palonis. Without meaning any disrespect, I will refer to Konn Palonis as “Palonis” for convenience. The third defendant is the Owners of Strata Plan 1813. The fourth defendant is Peta Bourke. The fifth defendant is Joanna Fardell. I will explain later in this judgment why the fourth and fifth defendants have played no role in this appeal. Mr Philips of Counsel appeared for the plaintiff. Mr Sirtes SC appeared for the first to third defendants. The parties relied upon a courtbook (“CB”). The parties made very lengthy submissions (about 80 pages) so I have endeavored to condense them so to reproduce their submissions with some clarity.
The plaintiff relevantly seeks the following orders:

Leave granted to the plaintiff to appeal from the decisions below, including the orders made on 30 June 2020,12 May 2021 and 22 July 2021.

(1A) To the extent necessary, the time for appealing from the orders made on 30 June 2020 be extended.

Appeal allowed.
Orders numbered 1 and 2 made below on 30 June 2020, Orders numbered 2, 3, 4, 5, 6 made below on 22 July 2021 and orders numbered 2 and 3 made below on 12 May 2021 be set aside and the appeal below be dismissed.
Order 1 in proceedings SC 19/28238 and SC 19/28234 made on 25 May 2020 be restored.
Orders 1, 2 and 3 made in proceedings SC 19/28238 and SC 19/28242 and SC 19/28244 made on 14 July 2020 be restored.
First and second defendants to pay the plaintiff's costs of this appeal and of the appeal below.

Background

The strata building is a two storey, four unit block in Maroubra which was constructed in the 1920s. Strata Plan 1813 comprises four lots, with Lots 15 and 16 on the ground floor and Lots 17 and 18 on the first floor. Lots 15 and 18 each have a unit entitlement of 26% while Lots 16 and 17 each have 24%.
At the time of the NCAT proceedings, Keevers was (and has been since 1978) the owner of Lot XX in Strata Plan 1813, located in Maroubra (“the strata building”). Lot XX had and has a unit entitlement of 24% in the strata building. Marta Casabon is the spouse of Keevers.
The first and second defendants, Sarraf Property Group and Palonis, have since about January 2016 owned Lots 15 and 18 in the strata building, which together have a combined unit entitlement in the strata building of 52%.
The Third Defendant is the Owners Corporation of the strata building (“Owners Corporation”)
The Fourth and Fifth Defendants (“Bourke” and “Fardell”) are sisters, who between about May 2018 and June 2021 were the owners of Lot 16 in the strata building (having inherited that lot from their late father). Lot 16 has a unit entitlement of 24% in the Strata building. In June 2021, Bourke and Fardell sold Lot 16 to Sarraf Property Group and Palonis, resulting in Sarraf Property Group and Palonis acquiring a combined unit entitlement of 76% in the strata building. The sale of Lot 16 explains why the fourth and fifth defendants did not appear at the hearing as they no longer had any interest in their property.
During the Appeal Panel proceedings, Sarraf Property Group and Palonis were referred to as the majority lot owners, while Keevers and Bourke and Fardell were referred to as the minority lot owners. Now Keevers is the minority owner and Sarraf Property Group and Palonis are the majority lot owners.
On 10 April 2017, an extraordinary general meeting of the Owners Corporation on was held, where it was resolved that the Owners Corporation engage a building consultant to prepare a report in relation to any structural or remedial issues of the building.
On 9 June 2017, the Strata Manager received a Building Inspection Report prepared by Strata Defects Specialists, Michael Dakhoul, which provided an opinion in relation to defects within the strata building (“Dakhoul report”). The report concluded that the estimated cost of undertaking work to remedy the defects in the strata building was $1,006,425.00.
On or about 13 November 2017, the Owners Corporation circulated a Notice of Meeting for an Annual General Meeting. The notice included proposed resolutions to the following effect: building contractors be retained to undertake in the order of $800,000 in building works to the strata building; a Special Levy for a total amount of $1,000,000 be struck to assist with payment for the building works; the number of members of the Strata Committee for the ensuing year to be decided, and such members to be elected.
On 27 November 2017, the solicitor for Keevers informed the strata manager that he considered the Notice of Meeting to be defective in several respects, and that, as a result, if the proposed AGM were to proceed, then resolutions passed at it would be invalid.
On 28 November 2017, the AGM of the Owners Corporation occurred, with Keevers, Bourke and John Sarraf (as company nominee for Sarraf Property Group) were present. At this meeting the following matters were resolved by ordinary resolution, only 3 members were elected to the Strata Committee, excluding Keevers; approval of expenditure for building works, and special levies, of about $980,000 in total, amounting to about $250,000 for each of the 4 lots (“2017 Special Levies”).
Both Keevers and Bourke and Fardell refused to pay the 2017 Special Levies on various grounds, including that they were invalidly struck. This led to the commencement of the debt recovery proceedings by the Owners Corporation against Keevers and Bourke and Fardell in the District Court.
Keevers, Bourke and Fardell obtained a building condition report which indicated that, contrary to the Dakhoul Report, the strata building was in a generally fair condition and required only about $77,650 in essential works in order to rectify the common areas and common property. In particular, this report described the roofing membrane as being in very good condition and reported as being only a few years old, and that the perimeter parapet wall had recently been capped.

Procedural background in various courts and in NCAT

There has been continuing, highly contested litigation in various Courts and NCAT, between the parties. I shall set out the litigation relevant to these proceedings.
On 23 February 2018, by summons, Keevers commenced proceedings against the Owners Corporation in the Equity Division of this Court (“SC Proceedings”) and then filed Points of Claim on 14 April 2018. The Owners Corporation was the sole defendant to those proceedings, with Keevers (initially) the sole plaintiff. The initial relief sought in the Summons related to a by-law which had been passed by the Owners Corporation concerning garage spaces. This issue has no significance in this appeal.
On 30 May and 3 July 2018, the Owners Corporation commenced (separate) debt recovery proceedings against Keevers, and Bourke and Fardell, in the District Court of NSW (“DC Proceedings”) seeking payment of the unpaid 2017 Special Levies. On 6 July and 6 August 2018, defences were filed in the District Court. On 3 August and 7 December 2018, consent orders were made transferring the DC Proceedings to the Supreme Court and ordering that they be heard and determined together with the SC Proceedings.
On 22 March 2019, Keevers served proposed Amended Points of Claim in the SC Proceedings that included adding Bourke and Fardell as plaintiffs.
On 1 April 2019, the SC and DC Proceedings were listed for hearing before Darke J.
On 3 June 2019, Amended Points of Claim were filed in the SC Proceedings in which Bourke and Fardell were added as plaintiffs. The relief sought in the Amended Points of Claim was expanded to include orders (pursuant to ss 87 237 Strata Schemes Management Act 2015 (NSW)) reducing the 2017 Special Levies down to $25,000 for each lot owner and for the appointment of an independent strata manager to exercise all the functions of the Owners Corporation. The Owners Corporation remained as the sole defendant to those proceedings.
On 14 June 2019, Darke J made orders transferring both the SC Proceedings and DC Proceedings to NCAT for determination.

The NCAT proceedings

On 24 July 2019, case management orders were made in the proceedings by NCAT (Ex C in this Appeal). The relevant orders to this appeal are:

“(7) if any lot owner in the strata scheme seeks to make submissions or provide documents in relation to the application for compulsory management they must seek to have themselves joined as a respondent to the proceedings and file and serve any submissions or documents by 4 October 2019; and
(8) Note that interested parties are on notice that they will not be able to make submissions or give evidence at the hearing unless they have added themselves as a respondent to the proceedings.”

Neither Sarraf Property Group nor Palonis availed themselves of this opportunity to be joined as a party to the proceedings. The directions included were that if they were not joined as parties they could not make submissions before the Tribunal Member. Hence they did not make submissions before the Tribunal Member. I shall refer in more detail to what transpired before Deputy President Westgarth shortly.
On 6, 7 and 8 April, 14 May and 14 July 2020, the proceedings were heard before Senior Member Ellis SC (“the Senior Member”) Neither Sarraf Property Group nor Palonis gave evidence or made submissions. The Senior Member delivered his substantive reasons and made orders on 25 May 2020 and delivered further reasons and made orders for costs on 14 July 2020 (Costs orders). The relevant orders made by Senior Member Ellis on 25 May 2020 are as follows:

Rollings and Tyrell Pty Ltd are appointed as strata managing agent to exercise all the functions of the Owners Corporation pursuant to s 237 of the Strata Schemes Management Act

The appointment is to continue for a period of two (2) years from the date of these orders.

Orders pursuant to s 87 Strata Schemes Management Act reducing the 2017 Special Levies from $980,000 in total down to $80,000.

The relevant orders made on 14 July 2020 are as follows:

that the Owners Corporation is to pay the costs of Keevers, Bourke and Fardell of (each of) the proceedings, and

The Owners Corporation is not to recoup its costs from any levy or fund which includes monies contributed by those parties (costs orders).

Appeal to the Appeal Panel

On 26 May 2020, the Owners Corporation filed a Notice of Appeal to the Appeal Panel seeking to appeal all of the orders of Senior Member. An application seeking leave to appeal and a stay of the order for compulsory strata manager was later withdrawn. While the Tribunal Member had made an order appointing an independent Strata Manager, Rollings and Tyrell Pty Ltd for a period of 2 years (from 25 May 2020) at the time of the hearing of the appeal in this Court, the period of appointment of the independent strata manager had expired. The Owners Corporation was named as the appellant in the appeal, with Keevers, Bourke and Fardell named as the defendants.

Interlocutory hearing and orders of Deputy President Westgarth (“Deputy Presidents decision”) comprising of the Appeal Panel dated 30 June 2020

The orders made by the Deputy President assume importance in the current appeal to this Court.
On 30 June 2020, at the hearing of the stay application (before Deputy President Westgarth constituting the Appeal Panel), the following transpired:

an oral application was made by Sarraf Property Group and Palonis to be joined as parties to the appeal;

counsel for Keevers, Bourke and Fardell opposed the joinder of Sarraf Property Group and Palonis as parties to the appeal,

Sarraf Property Group and Palonis were joined to the Appeal as additional plaintiffs; and

the solicitors for the Owners Corporation were granted leave to represent Sarraf Property Group and Palonis in the Appeal.

The Transcript

I have extracted the relevant portions of the transcript of the hearing before Deputy President Westgarth on the topic of the joinder of parties.
At T7.12-T9-22 (CB 364-366), the following exchange took place between Mr Philips, appearing for Keevers, Mr Moir, appearing for Sarraf Property Group and the Deputy President:

“Mr Philips: …But there may be a case for a joinder of the two parties identified by Mr Moir once those costs orders have been delivered, but, as things currently stand, in my submission, there's no basis for those two parties at this stage to be joined as parties to the appeal. Can I just respond…
…
The D. President: The costs orders won't be against the majority owners. They will be against the Owners Corporation, won't they?
Mr Philips: Yes. But depending on the way the form of the order that is sought.
…
Now, if that order is not made along those lines, then it's difficult to see how Sarraf Property Group and Mr Palonis would have any standing to be joined as appellants to the appeal.
The D. President: Except for this… That there's no real contradicter (SIC) in the appeal.
Mr Philips: I accept that.
The D. President: I just can't see how you can avoid not adding these two majority owners if the real interests are to be discussed opening before the appeal panel, that is to say that majority and the minority unit holders have different positions and that can only be properly ventilated by these two majority owners being added, I would have thought.
Mr Philips: … If you're minded- if you're against me, ...either today or at some future occasion to join these two parties as appellants, then I wouldn't wish to be heard any further about that. The further submission that I wish to make or observation that I wish to make was that the Sarraf Property Group and Mr Palonis did have an opportunity - when the proceedings below were transferred from the Supreme Court to the tribunal, there was an opportunity, I think to formally make this on the record, but it should be apparent on some directions that were made-I can't remember the name of the senior member, but it was-when it first came before the tribunal, an opportunity was given to those two parties to join the proceedings as there were countervailing claims.
… when that first came before the tribunal, there was an opportunity given to Mr Palonis and Sarraf Property Group as interested parties to join in the proceedings either as appellants - applicants or respondent in some way and they declined to avail themselves of that opportunity. That's merely one further submission I wish to draw attention- the tribunal's attention to on the question of whether it's appropriate that they should be joined as parties as appellants in the appeal, but that's all I wish to say in relation to that point.
Mr Moir: All I can say, Deputy President, was that most of the orders being sought by the two parties and there were three applications that were determined and there were orders sought on both side, but mostly then there was no reason to join the other owners the majority owners to the proceedings. But one of the orders was repayments with the collection of a special levy. There's no reason to join them on that order. Another order being sought by the minority owners was to confirm their right of exclusive use of a garage by-law. That was the dispute between them and the Owners Corporation. There was no reason to join the majority owners for that purpose either.

The main reason when the tribunal normally runs these two joined - or gives parties the opportunity to be joined to proceedings is whether the proposed change of unit entitlements because all owners can be directly affected their unit entitlements and their share of the vote and their share of the levies can go up or down if those orders are made. That, I believe, was the reason - but I could be wrong, but I believe that was the reason why the tribunal made that standard order for those people to be joined if they would like to and, ultimately that order was abandoned from Mr Philips at the hearing. So I don't think, given the orders that were made and the order that's being appealed, I don't think it was really appropriate for those parties to be joined in the previous proceedings or to seek to be joined in the previous proceedings.
The D. President: Well, with great respect to you both, I don't think the history of it is directly relevant. I think what is relevant is that there's an appeal brought by an Owners Corporation, the officers of which have been displaced by the appointment of a compulsory manager. In reality, those who wish to contest the orders that are under appeal is not the Owners Corporation nor the respondents to the appeal, but two other parties who are called the "majority owners" and I think that the interests of justice require that they be added as additional appellants and I propose, therefore, to add Sarraf Property Group and Palonis, whoever they are, to the appeal as additional appellants. And do I take it that, Mr Moir, you will be representing those two appellants?
Mr Moir: Yes. I will.”

The Appeal Panel

On 28 October 2020, Keevers, Bourke and Fardell served their submissions on the appeal. In [5]-[11] of those submissions, they raised, as a threshold issue, the standing of Sarraf Property Group and Palonis to bring or be joined as plaintiffs in the appeal. They submitted that, by virtue of the provisions of s 80(1) of the Civil and Administrative Tribunal Act 2013 (NSW)(“NCAT Act”), as they were not parties to the proceedings below, Sarraf Property Group and Palonis did not have any standing to, and therefore could not, to bring the appeal to the Appeal Panel.
On 27 November 2020, Sarraf Property Group and Palonis served their written submissions in reply.
On 8 and 17 December 2020, the hearing of the appeal took place before the Appeal Panel comprised of Durack SC and D Robertson, Senior Members (“The Appeal Panel”). On 12 May 2021, the Appeal Panel delivered its substantive reasons, and delivered further reasons on costs. It made orders on 22 July 2021. The orders made by the Appeal Panel were in substance as follows:

set aside the s 87 orders (reducing the 2017 Special Levies to $80,000 in total) save to the extent that each required payment of a levy referable to repair work required to the common stairs in the sum of $80,000;

remit to a differently constituted Tribunal for redetermination (based on evidence already adduced and such further evidence as may be allowed) all claims made concerning the 2017 Special Levies, the appointment of a compulsory strata manager and the question of costs of the proceedings at first instance; and

Sarraf Property Group’s costs of the appeal to be paid by Keevers, Bourke and Fardell.

Events since the decision of the Appeal Panel

On 14 May 2021, Sarraf informed Keevers (by email) that the previous strata manager (CF Strata) had refused to take back management of the strata scheme and that the Sarraf Property Group would be nominating a different manager to replace the compulsory strata manager as soon as practicable.
On 20 May 2021, Sarraf informed Keevers (by email) that Sarraf Property Group and a company controlled by Palonis had entered into a contract to purchase Lot 16 from Bourke and Fardell.
On 28 May 2021, the solicitors for Sarraf Property Group and Palonis informed the solicitor for Keevers that as the plaintiffs now control at least 75% of the lots in the strata scheme, they had been instructed to commence the strata renewal process in Part 10 of the Strata Schemes Development Act 2015 (NSW).
On 30 May 2021, the solicitors for the Sarraf Property Group informed the solicitor for Keevers (by email) that the strata manager appointed by the Tribunal (Ms Tyrrell) had ceased managing the scheme, had handed over the books and records to the plaintiffs and they had passed a motion appointing their preferred strata manager to run the scheme.
On 1 September 2021 a development application was lodged with Randwick Council (on the instructions of Sarraf) for the demolition of the strata building and the construction of nine apartments on the site in its place.
On 23 September 2021, an order was made by NCAT that the remitted proceedings be stayed pending finalisation of the appeal to this Court.
Currently, the strata block is vacant. The tenants have vacated the premises. The power has been turned off.
On 8 July 2022, I granted an urgent stay of the execution of District Court judgment in proceedings number 2022/123197:

“Upon the undertaking proffered to the Court by counsel on behalf of the plaintiff not to dispose of or further encumber the property pending the determination of the appeal, with exception to the proposed $300,000.00 draw down under their mortgage facility with Credit Union of Australia Ltd, as deposed in the plaintiff’s affidavit.
THE COURT ORDERS THAT:
(1)   The enforcement of the judgment of the District Court of New South Wales in proceedings number 2022/00123197 given on 29 April 2022 (“the Proceedings”) be stayed pending determination of the appeal and until 14 days after the publication of reasons in relation to the appeal to this Court or further order of this Court.
(2)   The operation and effect of the garnishee order made on 7 June 2022 in the Proceedings be stayed pending determination of the appeal and until 14 days after the publication of reasons in relation to the appeal to this Court or further order of this Court.
(3)   In the event that Mr Keevers fails by Friday 15 July 2022 to pay $132,716.37 by way of security for the judgment debt into his solicitor’s trust account, the stay effected by orders 1 and 2 above are automatically discharged.
(4)   The plaintiff’s solicitor, Mr Terret shall confirm in writing upon receiving such funds into his trust account, as provided in order 3 above, with the defendants’ solicitors.
(5)    Costs reserved.”

Grounds of appeal in this Court

The grounds of appeal as set out in the amended summons are numerous. They are follows:

(1A) The Appeal Panel erred, in law, in ordering that the First and Second Defendants be joined to the appeal as additional plaintiffs, in circumstances where:

s 80(1) of the NSW Civil and Administrative Tribunal Act 2013 provides that an appeal against an internally appealable decision may only be made to an Appeal Panel by a party to the proceedings in which the decision is made and the first and second defendants were not parties to the proceedings in which the decision the subject of the appeal below was made; and
the appeal below sought relief by way of orders pursuant to s 86(1) of the Strata Schemes Management Act 2015 and s 86(2) of that Act provides that such an order may only be made on the application of the Owners Corporation.

(1B) In the alternative to Ground 1A, the Appeal Panel erred, in law, by not limiting the joinder of the first and second defendants as additional plaintiffs to the appeal to those grounds of appeal relating to the appointment of a compulsory strata manager pursuant to s 237 of the Strata Schemes Management Act 2015.

The Appeal Panel erred, in law, in finding that:

it was open to the plaintiff to appeal the interlocutory decision of the Deputy President and that the only method of challenging that decision was to make such an appeal: [86] of the Appeal Panel's Reasons for Decision dated 25 May 2021,

the plaintiff did not suggest that the Appeal Panel should revoke the interlocutory decision of the Deputy President [87]; and

the plaintiff's submissions amounted to an impermissible collateral challenge to the decision of the Deputy President: [91].

The Appeal Panel erred, in law, in finding that:

the Tribunal at first instance made an error of law in the form of procedural unfairness by making findings (in [79] of its Reasons) described as "adverse" in circumstances where such findings were not advanced or sought by the plaintiff: Reasons 1 [139]-[140];

it was not open (to the Tribunal) to conclude that a cost estimate was inflated because there was no probative evidence for such conclusion and the Tribunal erred in so doing (Reasons 1 [141]-[142]) in circumstances where there was probative evidence for such conclusion;

material from an expert witness report was not capable of supporting a conclusion that the costs estimate was inflated (Reasons 1 [166]) in circumstances where such material was capable of supporting such conclusion;

it was not open (to the Tribunal) to conclude that the building work the subject of the special levy went beyond what was required by s 106 of the Strata Schemes Management Act because there was no probative evidence to support such conclusion and such conclusion was an error of law (Reasons at [168]-[169]) in circumstances where there was probative evidence for such conclusion.

The Appeal Panel erred, in law, in:

upholding Ground 6 of the appeal below, and in so doing finding that the Tribunal's conclusions (about preferring the evidence of the plaintiff and Casabon to that of Norman Sarraf and that Norman Sarraf said at a meeting that the renovation work would never be carried out) were impugned and undermined by material errors of fact (Reasons 1 [215-216]) without identifying any such errors of fact; and

upholding Ground 5 of the appeal below ([225]) and in so doing failing to give any, or sufficient, weight to the unchallenged findings made by the Tribunal (at [108] of its Reasons for Decision of 25 May 2020) which, individually and collectively, supported the conclusion that the special levy had been imposed for an improper purpose.

The Appeal Panel erred, in law, in finding and ordering, in its second Reasons for Decision dated 30 July 2021 that:

the First and Second Defendants achieved substantial success in the appeal (Reasons 2 at [31]) in circumstances where:

none of the relief sought by them in the appeal (namely the making of all of the orders sought by the Owners Corporation before the Tribunal below) was granted;

contrary to the finding (Reasons 2 at [31(1)]) that they succeeded in having all of the orders made by the Tribunal at first instance which they challenged overturned), one of the principal orders of the Tribunal below which they challenged (namely the appointment of a compulsory strata manager) was not set aside following the appeal; and

where the substantive orders made following the appeal (namely the remittal of the proceedings to a freshly constituted Tribunal for redetermination) had not been sought; and

the plaintiff should pay the First and Second Defendants' costs of the appeal below. (costs)

While there are numerous grounds of appeal, they fall into three broad categories. The first group consists of Appeal Grounds 1A, 1B and 1 in the amended summons. In these grounds, the plaintiff submitted that the Appeal Panel erred, in law, in ordering that Sarraf Property Group and Palonis be joined as plaintiffs (“Joinder of parties”). This is the main issue in this appeal. The second group of appeal grounds consists of Appeal Grounds 2(a), 2(b)-(d) and 3(a)-(b). These grounds allege errors made by the Appeal Panel as to findings of evidence and fact (“findings of fact and evidence”). The third group, Appeal Ground 4, refers to costs.

Extension of time to appeal

The first issue to be determined in these proceedings is whether and extension of time to appeal should be granted. It is my view that at the time Sarraf Property Group and Palonis were joined as parties, it may not have been clear to Keevers, Bourke and Fardell whether they should have appealed to the Court of Appeal in relation to the decision of Deputy President Westgarth (Comprising of the Appeal Panel) before the Appeal Panel heard the appeal. As was recently said by the Court of Appeal in Chalak v G & G Michael Pty Ltd [2022] NSWCA 116 at [9], the Court is cautious about granting leave to appeal from interlocutory judgments, especially those that are concerned with practice and procedure. As the plaintiff contends that had the appeal been upheld, there would have been no utility in incurring additional costs in appealing to the Court of Appeal on an interlocutory matter. In these circumstances, I grant an extension of time to appeal to this Court.

Leave to appeal

The next issue is whether leave to appeal should be granted, I can only make a determination on these topics after I have examined the grounds of Appeal and in particular in particular Grounds of appeal 1A, 1B and 1.
Section 83 of the NCAT Act relevantly reads:

“83 Appeals against appealable decisions
(1) A party to an external or internal appeal may, with the leave of the Supreme Court, appeal on a question of law to the Court against any decision made by the Tribunal in the proceedings.
…
(3) The court hearing the appeal may make such orders as it considers appropriate in light of its decision on the appeal, including (but not limited to) the following—
(a) an order affirming, varying or setting aside the decision of the Tribunal,
(b) an order remitting the case to be heard and decided again by the Tribunal (either with or without the hearing of further evidence) in accordance with the directions of the court.”

There are many cases which deal with the principles governing leave to appeal. I will refer to Be Financial Pty Ltd as Trustee for Be Financial Operations Trust v Das [2012] NSWCA 164 (“Das”), Lee v New South Wales Crime Commission (2012) 224 A Crim R 94; [2012] NSWCA 262 (“Lee”) and Coulter v R [1988] HCA 3; 164 CLR 350 (“Coulter”).
In Das, the Court of Appeal set out the principles to be considered in deciding whether leave to appeal should be granted. At [32], [33] and [35], Basten JA stated:

“[32] The principles governing cases such as these have recently been restated in Zelden v Sewell; Henamast Pty Ltd v Sewell [2011] NSWCA 56. As Campbell JA noted (with the agreement of Young JA) at [22]:
‘It is of some importance to reiterate the principles that were stated in Carolan v AMF Bowling Pty Limited [1995] NSWCA 69, where Sheller JA said that an applicant for leave must demonstrate something more than that the trial judge was arguably wrong in the conclusion arrived at. Cole JA relied on a principle that where small claims are involved, it is important that there be early finality in determination of litigation, otherwise the costs that will be involved are likely to swamp the money sum involved in the dispute.’

[33] In Jaycar Pty Ltd v Lombardo [2011] NSWCA 284 Campbell JA, with the agreement of Young and Meagher JJA, expanded on his summary of Carolan, noting that Kirby P had recognised ‘that ordinarily it was appropriate to grant leave to appeal only concerning matters that involve issues of principle, questions of general public importance or an injustice which is reasonably clear, in the sense of going beyond [what is] merely arguable’: at [46].
…
[35] In Coulter v The Queen [1988] HCA 3; 164 CLR 350, dealing with a challenge to a refusal of the South Australian Full Court to grant leave to appeal in a criminal matter, the majority noted that a leave requirement was a preliminary procedure ‘recognised by the legislature as a means of enabling the court to control in some measure the volume of appellate work requiring its attention’: at 356 (Mason CJ, Wilson and Brennan JJ). That statement is clearly applicable to civil, as well as criminal, appellate jurisdiction.”

Similarly, in Lee, Bathurst CJ outlined the principles relevant to the granting of leave at [12]:

“[12] The principles upon which leave to appeal is granted are well established. Ordinarily it is only appropriate to grant leave concerning matters that involve issues of principle, questions of general public importance or where it is reasonably clear there has been an injustice in the sense of going beyond it being reasonably arguable that the primary judge was in error: Carolan v AMF Bowling Pty Ltd [1995] NSWCA 69; Zelden v Sewell [2011] NSWCA 56 at [22]; Jaycar Pty Ltd v Lombardo [2011] NSWCA 284 at [46]; GKD v Director of Department of Family & Community Service [2012] NSWCA 219 at [10]; Be Financial Pty Ltd v Das [2012] NSWCA 164 at [32]-[34].”

The authorities referred to above are equally applicable in these proceedings. In determining whether or not I should grant leave to appeal, I shall consider whether the matters raised on appeal to this court involve issues of principle, questions of public importance, and whether it is reasonably clear that there has been an injustice in the sense of going beyond what is reasonably arguable that the Appeal Panel was in error.

The relevant statutory provisions

It is necessary to briefly refer to the most relevant statutory provisions of the Strata Schemes Management Act, the NCAT Act and Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”) 6.19.

Strata Schemes Management Act

While some of the statutory provisions of the Strata Schemes Management Act are not directly relevant, they provide a background framework for the Tribunal Member’s and the Appeal Panel’s decisions.
The Owners Corporation is responsible for the management of the strata scheme: s 9.
Section 44(1) sets out the functions of treasurer of Owners Corporation. They include: to notify owners of any contributions levied in accordance with this Act; to receive, acknowledge, bank and account for any money paid to the Owners Corporation; to prepare any strata information certificate; and to keep the accounting records and prepare the financial statements.
The Owners Corporation must establish a capital works fund: s 74(1). The Owners Corporation must pay into the capital works fund contributions levied on lot owners for payment into that fund: s 74(2)(a). The Owners Corporation may pay money from the capital works fund only for prescribed payments, which includes payments of the kind for which estimates have been made under s 79 (2): s 74(4)(a).
An Owners Corporation must at each annual general meeting estimate how much money it will need to credit to its capital works fund for actual and expected expenditure for various purposes, including to replace or repair the common property: s 79(2). It must prepare and, in so far as practicable, implement a 10-year capital works plan including the detail and costing in respect of the works: s 80.
The Owners Corporation must determine the amounts to be levied as a contribution to the capital works fund to raise the amounts estimated as needing to be credited to that fund and levy on each person liable for such contribution: s 81. Such a contribution is, if the Owners Corporation so determines, payable by the regular periodic instalments specified in the determination setting the amount of the contribution: s 81(5).
A contribution levied by an Owners Corporation becomes due and payable on the date set out in the notice of the contribution: s 83(3).
Section 86 makes provision for recovery of unpaid contributions. It reads:

86 Recovery of unpaid contributions and interest
(1) The Tribunal may order the owner of a lot in the strata scheme, or other person, to pay a contribution that is payable by the owner or other person under this Act that is not paid at the end of 1 month after it becomes due and payable, together with any interest payable on that unpaid contribution and the reasonable expenses of the owners corporation incurred in recovering those amounts.

(2)   The Tribunal may make an order under subsection (1) only—
(a)   on the application of the owners corporation, and
(b)   if proceedings between the owners corporation and the owner of a lot in the strata scheme or other person are pending before the Tribunal.
…

Section 87 makes provision for the Tribunal to vary a contribution. It reads:

87   Orders varying contributions or payment methods
(1)   The Tribunal may, on application, make either or both of the following orders if the Tribunal considers that any amount levied or proposed to be levied by way of contributions is inadequate or excessive or that the manner of payment of contributions is unreasonable—
(a)   an order for payment of contributions of a different amount,
(b)   an order for payment of contributions in a different manner.

(2) An application for an order may be made by the lessor of a leasehold strata scheme, an owners corporation, an owner or a mortgagee in possession.

The Owners Corporation is obliged to maintain and repair the common property. Section 106, reads:

106 Duty of owners corporation to maintain and repair property
(1) An owners corporation for a strata scheme must properly maintain and keep in a state of good and serviceable repair the common property and any personal property vested in the owners corporation.

Section 237 reads:

237 Orders for appointment of strata managing agent
(1) Order appointing or requiring the appointment of strata managing agent to exercise functions of owners corporation The Tribunal may, on its own motion or on application, make an order appointing a person as a strata managing agent or requiring an owners corporation to appoint a person as a strata managing agent--
(a) to exercise all the functions of an owners corporation, or
(b) to exercise specified functions of an owners corporation, or
(c) to exercise all the functions other than specified functions of an owners corporation.

(2) Order may confer other functions on strata managing agent The Tribunal may also, when making an order under this section, order that the strata managing agent is to have and may exercise--
(a) all the functions of the chairperson, secretary, treasurer or strata committee of the owners corporation, or
(b) specified functions of the chairperson, secretary, treasurer or strata committee of the owners corporation, or
(c) all the functions of the chairperson, secretary, treasurer or strata committee of the owners corporation other than specified functions.

(3) Circumstances in which order may be made The Tribunal may make an order only if satisfied that--
(a) the management of a strata scheme the subject of an application for an order under this Act or an appeal to the Tribunal is not functioning or is not functioning satisfactorily, or
(b) an owners corporation has failed to comply with a requirement imposed on the owners corporation by an order made under this Act, or
(c) an owners corporation has failed to perform one or more of its duties, or
(d) an owners corporation owes a judgment debt.

(4) Qualifications of person appointed A person appointed as a strata managing agent as a consequence of an order made by the Tribunal must--
(a) hold a strata managing agent's licence issued under the Property and Stock Agents Act 2002 , and
(b) have consented in writing to the appointment, which consent, in the case of a strata managing agent that is a corporation, may be given by the Secretary or other officer of the corporation or another person authorised by the corporation to do so.

(5) Terms and conditions of appointment A strata managing agent may be appointed as a consequence of an order under this section on the terms and conditions (including terms and conditions relating to remuneration by the owners corporation and the duration of appointment) specified in the order making or directing the appointment.
…
(8) Persons who may make an application The following persons may make an application under this section--
(a) a person who obtained an order under this Act that imposed a duty on the owners corporation or on the strata committee or an officer of the owners corporation and that has not been complied with,
(b) a person having an estate or interest in a lot in the strata scheme concerned or, in the case of a leasehold strata scheme, in a lease of a lot in the scheme,
(c) the authority having the benefit of a positive covenant that imposes a duty on the owners corporation,
(d) a judgment creditor to whom the owners corporation owes a judgment debt.

Civil and Administrative Tribunal Act

The relevant sections of the NCAT Act are as follows.
Section 29 is contained in Part 3 which provides for the jurisdiction of the Tribunal.

29 General jurisdiction
(1) The Tribunal has
"general jurisdiction" over a matter if--
(a) legislation (other than this Act or the procedural rules) enables the Tribunal to make decisions or exercise other functions, whether on application or of its own motion, of a kind specified by the legislation in respect of that matter, and
(b) the matter does not otherwise fall within the administrative review jurisdiction, appeal jurisdiction or enforcement jurisdiction of the Tribunal.

Note: The general jurisdiction of the Tribunal includes (but is not limited to) functions conferred on the Tribunal by enabling legislation to review or otherwise re-examine decisions of persons or bodies other than in connection with the exercise of the Tribunal's administrative review jurisdiction.
(2) The Tribunal also has the following jurisdiction in proceedings for the exercise of its general jurisdiction--
(a) the jurisdiction to make ancillary and interlocutory decisions of the Tribunal in the proceedings,
(b) the jurisdiction to exercise such other functions as are conferred or imposed on the Tribunal by or under this Act or enabling legislation in connection with the conduct or resolution of such proceedings.

(3) A "general decision" of the Tribunal is a decision of the Tribunal determining a matter over which it has general jurisdiction.
(4) A "general application" is an application made to the Tribunal for a general decision.
(5) Nothing in this section permits general jurisdiction to be conferred on the Tribunal by a statutory rule unless the conferral of jurisdiction by such means is expressly authorised by another Act.

Part 4 Div 1 of the Act provides for the practice and procedure of the Tribunal. Sections 32(3)(a) and 36 read:

32 Internal appeal jurisdiction of Tribunal
…

(2) The Tribunal also has the following jurisdiction in proceedings for the exercise of its internal appeal jurisdiction—
(a) the jurisdiction to make ancillary and interlocutory decisions of the Tribunal in the proceedings,
..

36   Guiding principle to be applied to practice and procedure
(1) The guiding principle for this Act and the procedural rules, in their application to proceedings in the Tribunal, is to facilitate the just, quick and cheap resolution of the real issues in the proceedings.
(2) The Tribunal must seek to give effect to the guiding principle when it—
(a)  exercises any power given to it by this Act or the procedural rules, or
(b)  interprets any provision of this Act or the procedural rules.

(3) Each of the following persons is under a duty to co-operate with the Tribunal to give effect to the guiding principle and, for that purpose, to participate in the processes of the Tribunal and to comply with directions and orders of the Tribunal—
(a) a party to proceedings in the Tribunal,
(b) an Australian legal practitioner or other person who is representing a party in proceedings in the Tribunal.

(4) In addition, the practice and procedure of the Tribunal should be implemented so as to facilitate the resolution of the issues between the parties in such a way that the cost to the parties and the Tribunal is proportionate to the importance and complexity of the subject-matter of the proceedings.
(5) However, nothing in this section requires or permits the Tribunal to exercise any functions that are conferred or imposed on it under enabling legislation in a manner that is inconsistent with the objects or principles for which that legislation provides in relation to the exercise of those functions.

Part 4, Division 3 makes provisions for participation in proceedings. Section 44 reads:

44   Parties and intervention
(1) The Tribunal may order that a person be joined as a party to proceedings if the Tribunal considers that the person should be joined as a party.
(2) The Tribunal may order that a person be removed as a party to proceedings if the Tribunal considers that the person has—
(a)  been improperly or unnecessarily joined, or
(b)  ceased to be a proper or necessary party.

…
(4) The following persons may intervene and be heard in proceedings to which they are not already parties—
(a)  the Attorney General,
(b)  a Minister who administers the legislation that confers or imposes functions the exercise (or purported exercise) of which are in issue in the proceedings,
(c)  any other person who is authorised by this Act, enabling legislation or the procedural rules to intervene in the proceedings.
…

Sections 80, 81 and 82 read:

80   Making of internal appeals
(1) An appeal against an internally appealable decision may be made to an Appeal Panel by a party to the proceedings in which the decision is made.
Note—
Internal appeals are required to be heard by the Tribunal constituted as an Appeal Panel. See section 27(1).
(2) Any internal appeal may be made—
(a)  in the case of an interlocutory decision of the Tribunal at first instance—with the leave of the Appeal Panel, and
(b)  in the case of any other kind of decision (including an ancillary decision) of the Tribunal at first instance—as of right on any question of law, or with the leave of the Appeal Panel, on any other grounds.

(3) The Appeal Panel may—
(a) decide to deal with the internal appeal by way of a new hearing if it considers that the grounds for the appeal warrant a new hearing, and
(b) permit such fresh evidence, or evidence in addition to or in substitution for the evidence received by the Tribunal at first instance, to be given in the new hearing as it considers appropriate in the circumstances.

81   Determination of internal appeals
(1) In determining an internal appeal, the Appeal Panel may make such orders as it considers appropriate in light of its decision on the appeal, including (but not limited to) orders that provide for any one or more of the following—
(a)  the appeal to be allowed or dismissed,
(b)  the decision under appeal to be confirmed, affirmed or varied,
(c)  the decision under appeal to be quashed or set aside,
(d)  the decision under appeal to be quashed or set aside and for another decision to be substituted for it,
(e)  the whole or any part of the case to be reconsidered by the Tribunal, either with or without further evidence, in accordance with the directions of the Appeal Panel.

(2) The Appeal Panel may exercise all the functions that are conferred or imposed by this Act or other legislation on the Tribunal at first instance when confirming, affirming or varying, or making a decision in substitution for, the decision under appeal and may exercise such functions on grounds other than those relied upon at first instance.
82   Interpretation
(1) Each of the following kinds of decisions of the Tribunal is an appealable decision of the Tribunal for the purposes of this Division—
(a)  any decision made by an Appeal Panel in an internal appeal,
(b)  any decision made by the Tribunal in an external appeal,
…

Note—
An appealable decision includes any ancillary or interlocutory decisions of the Tribunal in such proceedings.
…

Finally, UCPR 6.19 reads:

6.19 Proceedings involving common questions of law or fact
(cf SCR Part 8, rule 2; DCR Part 7, rule 2; LCR Part 6, rule 2)
(1) Two or more persons may be joined as plaintiffs or defendants in any originating process if--
(a) separate proceedings by or against each of them would give rise to a common question of law or fact, and
(b) all rights of relief claimed in the originating process are in respect of, or arise out of, the same transaction or series of transactions,
or if the court gives leave for them to be joined.

(2) Leave under subrule (1) may be granted before or after the originating process is filed.

The Appeal Panel’s decision – joinder of parties

The decision to which leave to appeal is sought is The Owners – Strata Plan No 1813 v Keevers [2021] NSWCATAP 130, a decision of the Appeal Panel dated 22 July 2021. The grounds of appeal [5]-[24] include many subparagraphs (CB 231-233).
On this topic of the joinder of parties namely, Sarraf Property Group and Palonis, the Appeal Panel summarised the respondents submissions as follows:

“[74]   The respondents submitted that the appeal should be dismissed at the outset because it was only the Sarraf Property Ground appellants who were pursuing the appeal and it was said that they had no standing to do so because they had not been parties to the proceedings at first instance.
…
[77]   It was the OC under the control of the SPG appellants which had pursued its claims in the proceedings at first instance to be paid contributions to the special levy and had defended the claims for the appointment of a strata manager and for variation of the special levy. Nevertheless, at the heart of the dispute in these proceedings was a dispute between the SPG appellants, as majority lot owners, and the minority lot owners.
[78]   It was uncontroversial that since the appointment of the strata manager (which took effect on the date the Tribunal made the orders the subject of the appeal) the OC was under the control of the compulsory strata manager and, although an appeal had been lodged, purportedly on behalf of the OC on the day after the Tribunal made its orders, but not by the compulsory strata manager as agent for the OC, no steps were taken by the compulsory strata manager on behalf of the OC to prosecute the appeal.
[79]   Because of the effect of the appointment of the compulsory strata manager, as provided for in the SSMA, unless the compulsory strata manager chose to prosecute the appeal, or some means were put in place by which the majority lot owners could prosecute the appeal, no effective appeal right would exist in respect of the Tribunal’s orders. Plainly, the compulsory strata manager had a personal interest that was in conflict with prosecuting an appeal which challenged to its appointment.
[80] This was the situation because the appointment of the compulsory strata manager under s 237 was to exercise all of the functions of the OC and functions is defined in the SSMA to include a power or authority (Definitions in s 4). This wide authority conferred on the compulsory strata manager covered a decision to pursue an appeal. There was no carve out from the appointment concerning a decision to pursue an appeal.
[81]   However, as the SPG appellants pointed out, the appointment itself did not operate to terminate the OC’s retainer of the solicitors who acted for it in the proceedings at first instance and who lodged the Notice of Appeal as representative of the OC. We were not provided with any evidence as to the terms of such retainer, including whether or not it authorised the lodging of an appeal.
…
[82]   The respondents submitted as follows:
(1)   The SPG appellants had declined the opportunity to become parties to the proceedings at first instance. This opportunity had been provided by orders made on 24 July 2019. It was submitted that it should be inferred that the SPG appellants did not take up the opportunity to be joined as parties because they were content to rely on their control of the OC and did not want to expose themselves to the possibility of an adverse costs order by being joined to the proceedings. It was also submitted that in these circumstances the SPG appellants had elected or waived any right to pursue an appeal.
(2)   Since 25 May 2020 (the date of the Tribunal’s orders) the powers and rights of the OC were reposed in the compulsory strata manager.
(3)   There was no evidence that the OC consented to or approved the lodging of the appeal in its name on 26 May 2020. That Notice of Appeal was lodged by the solicitors who had acted for the OC in the proceedings at first instance and were the solicitors acting for the SPG appellants in relation to the appeal (Mr Moir from Madison Marcus Law Firm was named in the Notice of Appeal as the representative of the OC).
(4)   Given that the compulsory strata manager has not taken any steps in the appeal and has informed the Tribunal that it does not wish to participate in the appeal, it should be inferred that the appeal was commenced without the consent or approval of the compulsory strata manager and, therefore, without the consent or approval of the OC.
(5) By orders made in the appeal proceedings by Deputy President Westgarth on 30 June 2020, the SPG appellants were added as appellants to the appeal pursuant to the Tribunal’s power in s 44 (1) of the NCAT Act. The respondents had objected to this step on the basis that the SPG appellants were not parties to the proceedings below and, therefore, had no standing to appeal the decision.
(6) Section 80 (1) of the NCAT Act provides that an appeal against an internally appealable decision may be brought by a party to the proceedings in which the decision is made and there is no provision for an appeal to be made by an entity which was not a party to the proceedings in which the decision was made.”

On this topic, the Appeal Panel concluded at [86]-[89] and [91]:

[84]   Significantly, neither before Deputy President Westgarth on 30 June 2020, nor before us, did the respondents contend that the appeal was invalid (because it had been commenced without the authority of the OC) and that, as a consequence, the Appeal Panel constituted by Deputy President Westgarth, had no power to make any order for the joinder of any party. In saying that, we do not suggest that such a contention would have been available to the respondents on this appeal since it was a contention that ought to have been advanced before Deputy President Westgarth, if it was to be made.
….
[86]   No appeal against the making of any of these orders has been brought.
[87]   In our opinion, the short answer to the respondents’ objection to the appeal on the basis that the SPG appellants have no standing is that the contrary position has already been determined by the decision made by the Deputy President on 30 June 2020, from which there has been no appeal, and the respondents do not suggest that we should revoke the interlocutory decision of the Deputy President by reason of a change of circumstances or other reason.
[89]   As appears from the respondents’ submissions to us, in arriving at this decision the Deputy President rejected the submission that the SPG appellants had no standing to be joined as appellants because they were not parties to the proceedings at first instance.
…
[91]   In substance, as the SPG appellants submitted, the respondents’ submissions ignored the effect of the decision of the Deputy President and amounted to an impermissible collateral challenge to that decision.

Appeal Grounds 1A, 1B and 1 – Joinder of parties

The plaintiff’s submissions

As set out earlier, by appeal grounds 1A, 1B and 1 in the Amended Summons, Keevers contends that the Appeal Panel erred, in law, in ordering that Sarraf Property Group and Palonis be joined as plaintiffs (or in not limiting such joinder) in circumstances where the provisions of the NCAT Act and the Strata Schemes Management Act provide that only parties to the proceedings can bring an appeal and only the Owners Corporation can bring proceedings for unpaid strata levies, and in finding that Keevers could not challenge the decision to join Sarraf Property Group and Palonis as plaintiffs.

Appeal Ground 1

In [86], [87] and [91] of the Appeal Panel’s reasons, the Appeal Panel made the following findings:

as no appeal had been made from the orders of the Appeal Panel joining the Sarraf Property Group as parties to the appeal, it was open to Keevers to appeal that (interlocutory) decision and the only way to challenge that decision was to make such an appeal;

Keevers did not contend that the Appeal Panel should revoke the interlocutory decision of the Deputy President; and

Keevers' submissions amounted to an impermissible collateral challenge to the decision of the Deputy President.

For the reasons set out below, each of these findings was, with respect, wrong, and the Appeal Panel erred in law in so finding.
First, implicit in these findings is an assumption that it was open to Keevers to bring a freestanding appeal challenging the interlocutory decision of the Appeal Panel to join the Sarraf Property Group to the appeal. This assumption is incorrect because:

s 32(3)(a) of the NCAT Act expressly provides that the internal appeal jurisdiction of the Tribunal (that is to the Appeal Panel) does not extend to any decision made by the Appeal Panel (which must include any interlocutory decision of the Appeal Panel). Consequently, Keevers could not have brought any appeal from the (interlocutory) decision of the Appeal Panel to the Appeal Panel itself;

the only mechanism by which Keevers could have brought an appeal from the Appeal Panel's interlocutory decision re joinder would have been to appeal (to this Court) pursuant to ss 82 and 83 of the NCAT Act. Any such appeal would have been subject to leave being granted by the Court: (see NCAT Act s 83(1)). It is doubtful that leave to appeal from such an interlocutory decision would have been granted at the time, especially given that appellate courts exercise caution in reviewing decisions pertaining to practice and procedure: eg Adam P Brown Male Fashions v Phillip Morris (1981) 148 CLR 170 at 177;

in any event, it would be unusual for the Court to grant leave and uphold an appeal from an interlocutory decision with respect to the joinder of a party (being a matter of discretion and practice and procedure), especially an application for leave made during the course of proceedings, given that any such application would be approached with restraint by the Court: see BHP Billiton Ltd v Dunning [2013] NSWCA 421 at [21].

Second, Keevers did, as a matter of substance, contend that the Appeal Panel should, in effect, revoke the interlocutory decision of the Appeal Panel (comprising the Deputy President). In submitting that the Appeal Panel should find that the Sarraf Property Group had no standing to bring the appeal and advancing the s 80 contention, Keevers was, in substance and effect, contending that the Deputy President had erred in joining them as plaintiffs and inviting the Appeal Panel to revoke that decision.
Third, in circumstances where there is no practical way for a party to appeal from an interlocutory decision of the Appeal Panel (at least until the whole appeal has been determined and an appeal can be made to the Court), the challenge to the substance of the Deputy President's decision (by advancing the s 80 contention) was not an impermissible collateral challenge to that decision. To the contrary, it was a reasonable and practical way of drawing to the attention of the Appeal Panel the reality that the Sarraf Property Group lacked standing and that by incident of s 80 the whole appeal was misconceived, and the Appeal Panel lacked jurisdiction to hear and determine it.

Ground 1A - the Appeal Panel erred in joining Sarraf Property Group and Palonis as plaintiffs

There is no specific provision in the NCAT Act that provides for an appeal to be brought by a party which was not a party to the proceedings in which the decision was made. Even a party which actively participated, made submissions to and was an intervenor in the proceedings, cannot be characterised as a party in the Tribunal proceedings below for the purposes of NCAT internal appeal rights under s 80 of the NCAT Act: Rice Marketing Board for the State of New South Wales v Forbidden Foods Pty Limited; Forbidden Foods Pty Limited v Rice Marketing Board for the State of New South Wales [2020] NSWCATAP 182 at [74] per Armstrong P and Senior Member Britton (“Rice Marketing Board”).
This is consistent with the more general principle that an appeal cannot be brought by an entity which was not a party to the proceedings in which the impugned decision was made. This in turn is supported by the following principles: it is parties, and parties alone, which have standing to conduct and appear in proceedings: see Australian Railways Union v Victorian Railways (1971) 125 CLR 319 at 331 per Dixon J. Any person who had an interest in and could make themselves a party to proceedings, but knowing what was passing, was content to stand by and see the battle fought by somebody else in the same interest, should be bound by the result, and not be allowed to re-open the case (or, it follows, appeal from the result): Administration of Papua New Guinea v Daera Guba (1972) 130 CLR 353 at 456 per Gibbs J; Osborne v Smith (1960) 105 CLR 153 at 155 per Kitto J; Nana Ofori Atta II v Nana Abu Bonsra II [1958] AC 95 at 102; House of Spring Gardens Ltd v Waite [1991] 1 QB 241 at 252-253.
There are sensible practical reasons for this. They are that if it were otherwise, it would be possible for an entity which may have a practical interest in the outcome of proceedings (such as a lot owner in a strata scheme) to decline an opportunity to participate as a party to proceedings (and thereby avoid any potential exposure to an adverse costs order) but still be able to appeal from a decision in those proceedings (to which it was not a party).
As Sarraf Property Group and Palonis were not parties to the proceedings before the Tribunal, given the terms of s 80(1), absent being joined as parties to the proceedings, they had no standing to bring or continue any appeal from the decision of the Tribunal and, it follows, the Appeal Panel had no jurisdiction to entertain or determine any appeal brought by such entities (not being parties to the proceedings in which the decision was made).
Sarraf Property Group and Palonis sought to circumvent this impediment to any appeal by them by making a joinder application. The Appeal Panel erred in granting this application, and in joining Sarraf Property Group and Palonis as plaintiffs in the appeal, for these reasons:

if Sarraf Property Group and Palonis had wished to resist the application by Keevers (and Bourke and Fardell) for a compulsory strata manager to be appointed pursuant to s 237 of the Strata Schemes Management Act (or otherwise oppose the granting of the other relief sought in the proceedings), they should have availed themselves of the express opportunity to do so which was afforded to them earlier in the Tribunal and have themselves joined as defendants to the proceedings. Sarraf Property Group and Palonis did not do so, and thereby elected not to be joined to the proceedings before the Tribunal and should be bound by that election, and its consequences, which included having no right or ability to appeal from the decision of the Tribunal;

if Sarraf Property Group and Palonis had been joined as defendants in the proceedings in the Tribunal and participated as such in the first instance hearing, they would have had a statutory right, as parties to the proceedings, to seek to appeal from the decision of the Tribunal. Having elected not to be so joined, they should not have (retrospectively) been granted the ability to appeal from a decision in proceedings in which they elected not to participate;

the corollary of the Appeal Panel's decision to join Sarraf Property Group and Palonis as plaintiffs is that it enables individual lot owners in a strata scheme which is the subject of an application for the appointment of a compulsory strata manager not to join themselves as defendants to such an application but nevertheless preserve the ability to appeal from a decision they consider to be unfavourable. In practical terms, the Appeal Panel's decision permits a person potentially affected by proceedings to elect not to participate in those proceedings but nevertheless to enjoy an ability to appeal from a decision in those proceedings;

by adding Sarraf Property Group and Palonis as plaintiffs without any limitation, the Appeal Panel in effect conveyed on them a wider ability to appeal than they would have enjoyed if they had (already) been joined to the proceedings before the Tribunal. This is because in the Notice of Appeal as lodged on 26 May 2020, the Owners Corporation sought that, in lieu of the orders made by the Tribunal Member, orders be made as sought in the District Court Proceedings (namely orders pursuant to s 86 of the Strata Schemes Management Act for the payment of the unpaid 2017 Special Levies) but s 86(2) of the Strata Schemes Management Act provides that such an order can only be made on the application of the Owners Corporation. Such orders were also sought by Sarraf Property Group and Palonis in the Amended Notice of Appeal filed on about 27 August 2020. If the Appeal Panel had, in determining the appeal, made the orders pursuant to s 86 Strata Schemes Management Act sought by Sarraf Property Group and Palonis, then it would have acted in excess of its jurisdiction, given that s 86(2) expressly provides that such an order can only be made on the application of the Owners Corporation. In other words, the Appeal Panel erred in adding Sarraf Property Group and Palonis as plaintiffs for all purposes and without limiting such joinder for the (limited) purpose of challenging the order appointing the compulsory strata manager because it left open the possibility that in granting the relief sought on appeal it would exceed its jurisdiction (and thereby fall into further error); and

if there was to be any joinder of additional parties to the proceedings below (not just to the appeal), that should only have occurred (by order pursuant to s 44 of the NCAT Act) following a proper hearing, of which proper notice was given and at which considered submissions were made. Further, any such order for joinder should have been subject to conditions that it was limited to the issue of the application for the appointment of a compulsory strata manager and that the newly joined parties be exposed to the same potential risks as the other parties to the proceedings, (particularly with respect to the costs of those proceedings), and not be represented by the same solicitor that had acted for the Owners Corporation throughout the proceedings. That Sarraf Property Group and Palonis were joined, not as parties to the proceedings below but only as plaintiffs, without a hearing for which proper notice was given, and without any such limitations, only highlights the errors made by the Appeal Panel in so ordering.

Put another way, the Appeal Panel's decision to allow Sarraf Property Group and Palonis to be joined as plaintiffs put them in a more advantageous position than they would have been if they had been joined to the proceedings below. As a result of the Appeal Panel's decision, Sarraf Property Group and Palonis enjoyed the benefits of being able to appeal from the decision of the Tribunal without facing any of the burdens imposed on the parties to the proceedings before the Tribunal (such as exposure to an order for costs). In short, the Appeal Panel's decision to join the Sarraf Property Group as plaintiffs led to substantive unfairness because it enabled entities who elected not to participate in proceedings to nevertheless appeal from a decision made in those proceedings.
The Appeal Panel compounded its initial error (in joining Sarraf Property Group and Palonis as plaintiffs) by proceeding to hear an appeal brought by two entities who were not a party to the proceedings in which the decision had been made. The Appeal Panel, even after (wrongly) ordering that Sarraf Property Group and Palonis be joined as plaintiffs, did not have any jurisdiction to hear (and determine) the appeal, because the Owners Corporation did not seek to prosecute the appeal and Sarraf Property Group and Palonis were not, and had not been made, parties to the proceedings in which the subject decision had been made, and therefore by incident of s 80(1) could not bring the appeal.

The section 80 contention

Section 80(1) of the NCAT Act only allows an appeal to be brought by a party to the proceedings in which the decision was made. The joinder of a party as an plaintiff in the appeal (but not as a party to the proceedings below) does not overcome this fundamental bar. The only way that Sarraf Property Group and Palonis could have (properly and legitimately) overcome the clear words of s 80(1) and ensured they would have an ability to appeal from the decision of the Tribunal, was by seeking to be joined as a party to the proceedings below before the Tribunal (not to the appeal). This they did not do, either when they were expressly given the opportunity to do so in 2019, or subsequently.
This section 80 contention was, in substance, advanced by Keevers before the Appeal Panel when he submitted (having referred to s 80(1)) that the appeal (as advanced by Sarraf Property Group and Palonis but not the OC) should be dismissed at the threshold on the basis that it was not properly brought by a person with standing to do: see Appeal Panel Reasons 1 [83]. The Appeal Panel failed to (properly) address this submission because it (wrongly) found that the contrary position had already been determined by the Appeal Panel (comprising the Deputy President) on 30 June 2020: see Appeal Panel Reasons 1 [87]. This finding was wrong because on 30 June 2020 the Deputy President had not determined that, for the purposes of s 80(1), Sarraf Property Group or Palonis had standing to bring the appeal, or if he had (implicitly) done so, he was in error, because neither of those entities was, or had been made, a party to the proceedings in the Tribunal, and therefore had no standing to bring the appeal.
At [87], the Appeal Panel (wrongly) found that the short answer to the s 80 contention was that the contrary position had already been determined by the decision made by the Deputy President on 30 June 2020. For the reasons set out above, this was no answer to the s 80 contention and the Appeal Panel was wrong to so find. Not only did this finding involve circular logic but it was wrong in point of fact. The Deputy President had simply made an order acceding to the (ad hoc) application that Sarraf Property Group and Palonis be joined as additional plaintiffs. In so doing, he did not provide any reasoning or make any findings, including any finding that the Sarraf Property Group had standing to bring the appeal. Contrary to the conclusion (and finding) of the Appeal Panel, the Deputy President did not order that the Sarraf Property Group be joined as parties to the proceedings (and thereby overcome the s 80 contention).

Hypothetical derivative proceedings

Sarraf Property Group and Palonis sought to outflank the s 80 contention by submitting (in reply) that it amounted to a triumph of form over substance and, in effect, that any procedural defect could be cured by them being joined to the proceedings below and bringing derivative proceedings on behalf of the Owners Corporation: see [4]-[7] of Sarraf Property Group Reply Submissions. For the reasons which follow, these submissions should have been rejected by the Appeal Panel (and it erred in not doing so).
First, it cannot be said that the clear terms of s 80(1) amount to a triumph of form over substance. As has been set out above, there are sensible and compelling reasons why a person who was not a party to the proceedings in which a decision was made, cannot have standing to bring an appeal from that decision, not least that if it were otherwise a person who was not a party to proceedings could nevertheless appeal from a decision made in those proceedings. This was, in effect, conceded by Sarraf Property Group and Palonis who submitted that the Tribunal could overcome any deficiency in form by making a further order pursuant to s 44 joining them to the proceedings below (which the Appeal Panel erroneously failed to do): see [4] of Sarraf Property Group Reply Submissions.
Second, while it may have been possible, at least in theory, for Sarraf Property Group and Palonis to have made an application to bring derivative proceedings on behalf of the Owners Corporation, that is not what actually occurred in this case. The theoretical possibility that such proceedings could have been brought was entirely hypothetical and as such provided no answer to the factual reality that Sarraf Property Group and Palonis had not sought to bring such proceedings and were not parties to the proceedings below (and therefore had no standing to bring the appeal by virtue of s 80).
Third, any application to bring derivative proceedings on behalf of the Owners Corporation (in order to prosecute the appeal) would have been opposed by Keevers and the Appeal Panel would have been wrong to entertain or grant any such application. Sarraf Property Group and Palonis relied upon Glenquarry Park Investments Pty Ltd v Hegyesi [2019] NSWSC 1120 (“Glenquarry Park Investments”) at [8]-[9] and Tan v Owners Corporation Strata Plan 22014 (No 2) [2015] NSWSC 1920 (“Tan”) as authority for the proposition that where there has been a compulsory appointment, meaning there is no avenue for a lot owner to cause the Owners Corporation to pursue an appeal, a lot owner is entitled to bring derivative proceedings in the name of the Owners Corporation: see [6] of Sarraf Property Group Reply Submissions. However, those authorities do not go that far. Rather, they merely establish that, in an appropriate case, the Court can, pursuant to its inherent equitable or statutory jurisdiction (which the Tribunal and Appeal Panel do not enjoy) grant leave to parties who are connected with corporations to bring proceedings for the benefit or in the name of the corporation.
In Tan, Robb J stressed (at [114]) that, in deciding whether to grant leave to individual lot owners to bring derivative proceedings in the name of the Owners Corporation, the fundamental question would be whether the applicants for leave wished to appeal in the name of the Owners Corporation to achieve a result that would be of a genuine benefit for the Owners Corporation, and for all of the lot owners, or whether, instead, the application was to secure a benefit for the applicants, but that for technical reasons requires the applicants to wield the name of the Owners Corporation to secure the benefit for themselves.
Here, there was no application for leave to bring derivative proceedings (or an appeal) in the name of the Owners Corporation or for the benefit of the Owners Corporation as a whole. Instead, there was an ad hoc application for Sarraf Property group and Palonis to be added as plaintiffs, not joined as parties to the proceedings below, for the benefit of the Sarraf Property Group, not the Owners Corporation as a whole, or for all of the lot owners. The reference to, and reliance on, principles relating to the bringing of derivative proceedings on behalf of the Owners Corporation was entirely hypothetical and of no relevance (or assistance) because no application was in fact made at any time to bring such proceedings.
Further, in addition to seeking to challenge the appointment of a compulsory strata manager, Sarraf Property Group and Palonis sought, as plaintiffs in their own right, to challenge the decision of the Tribunal to (substantially) reduce the 2017 Special Levies and in its place to make orders (pursuant to s 86 of the Strata Schemes Management Act) requiring Keevers (and Bourke and Fardell) to pay their share of these (disputed) special levies. In so doing, Sarraf Property Group and Palonis were not seeking to secure a benefit for the Owners Corporation as a whole and for all of the lot owners, but rather were seeking to secure a benefit for themselves as majority lot owners, and were acting contrary to the interests of Keevers (and Bourke and Fardell) as minority lot owners, and, on Keevers' case (and the findings made by the Tribunal) in furtherance of an improper purpose. This is consistent with the (unchallenged) finding of the Appeal Panel that it was the Owners Corporation, under the control of Sarraf Property Group and Palonis. which had pursued claims to be paid contributions to the special levy, and that the heart of the proceedings was a dispute between the majority lot owners (Sarraf Property Group and Palonis) and the minority lot owners (Keevers, Bourke and Fardell): see AP Reasons 1 [77].

of the remainder of the 2017 Special Levies (not refunded) a substantial amount has been used to cover administrative expenses and the deficit in the administrative fund (and it was not surprising that the minority lot wonders submitted that the money paid in response to the 2017 Special Levies was being used to fund the lawyers acting for the Owners Corporation in the proceedings); and

none of the 2017 Special Levies that had been received had been used to carry out urgent repairs needed to the stairs and landing (despite a repair notice having been received from Council);

At the Tribunal’s Reasons at [63], the Tribunal also found (based on 5 matters, only one of which was the subject of any challenge) that the objective of the Sarraf property Group was to acquire all four units, dismantle the strata scheme and redevelop the site, which remains an underlying motivation. This finding was not challenged before, or disturbed or subject to any adverse comment by, the Appeal Panel.
Consequently, notwithstanding the Appeal Panel's findings with respect to the evidence in relation to the 2018 February meeting, there remained twelve unchallenged findings which supported the Tribunal's ultimate finding with respect to improper purpose.
At [222], the Appeal Panel found that these findings left open the prospect that at the time the 2017 Special Levies were struck, the Sarraf Property Group, whilst keen to acquire the lots of Keevers and Bourke and prepared to exert pressure on them to sell, intended to cause the Owners Corporation to carry out the works (if the special levy contributions were paid and the defendants did not sell). This finding is at odds with, and is undermined by and cannot stand with, the remaining unchallenged findings of the Tribunal referred to above. Further, in and of itself this finding is internally inconsistent.
The Appeal Panel could not, with any consistency or coherence, find on the one hand that the Sarraf Property Group were keen to acquire the other lots and exert pressure on their owners to sell, and accept that their intention was to dismantle the strata scheme and redevelop the site, and on the other hand, intend to carry out the works the subject of the special levies (if they were paid), when armed with the knowledge that the special levies would be challenged and would not be paid by Keevers and could not be paid by Bourke.
The Appeal Panel's findings at [222] were completely at odds with both the remaining unchallenged findings as to the intentions and conduct of the Sarraf Property Group and the weight of the evidence, and cannot stand. If that finding is set aside, then the further findings (at [223]-[224]) that there was a prospect that there was no improper purpose should also be set aside. This would mean that the Tribunal's ultimate finding with respect to improper purpose (at [109]) should be restored.

The defendants’ submissions

The plaintiff attempts to overturn the Appeal Panel’s conclusions concerning factual matters, namely, that the Tribunal's conclusions about preferring the evidence of Casabon and Keevers to that of Norman Sarraf was impugned by material errors of fact. Being exclusively a factual matter this was a matter on which the Appeal Panel granted leave to appeal. Pursuant to s 83 of the NCAT Act, the Supreme Court does not have jurisdiction to grant leave in relation to alleged factual errors.
The plaintiff has no right to seek leave to appeal in relation to this ground. It should be dismissed. The plaintiffs reliance on Fox v Percy (2003) 214 CLR 118; [2003] HCA 22 and Rosenberg v Percival (2001) 205 CLR 434; [2001] HCA 18 (plaintiff’s submissions at [100]-[101]), illustrates that this ground of appeal relates to alleged factual errors, for which no appeal lies.
In any event, the plaintiff's submissions have no merit:

the Tribunal set out 6 reasons as to why it preferred the evidence of Keevers and his wife (Ms Casabon). These reasons were cumulative and interdependent Because of this, the plaintiff's submissions – which attack the Appeal Panel's findings as to 2 of the 6 reasons – do not overcome the material errors in the 4 remaining reasons;

in relation to the Tribunal's reason 6, the Appeal Panel explained why Norman Sarraf’s reference to 'sending 3000 texts' was not a proper basis for the Tribunal to come to an adverse conclusion about his general reliability (Appeal Panel at [198]-[204]). It was not put to Sarraf or in submissions that this testimony was adverse to him. The Appeal Panel set out the transcript of the evidence, including the innocuous and wrong question put by counsel for Keevers to Norman Sarraf, Norman Sarraf’s response and the apology from the questioner. As the Appeal Panel held, the reference to 'sending 3000 texts was an obvious and inconsequential exaggeration meaning “he sent a lot of texts each day”;

in relation to the Tribunal's reasons 3 and 4, the Appeal Panel correctly found that Bourke's evidence of her conversation with Norman Sarraf contained no reference to Norman Sarraf saying that the “renovation would never be carried out”, or that if Keevers paid his contribution the money would be used to buy Bourke's unit, so that the Tribunal's reasons 3 and 4 were wrong to the extent they suggested otherwise (at [205]). Further, the Appeal Panel correctly identified that the Tribunal failed to refer to Norm Sarrafs’ text message to Bourke, which was inconsistent with a belief that the remedial work would never be carried out (at [206]);

in relation to the Tribunal's reasons 2 and 4, the Appeal Panel correctly found that the Tribunal had made material factual errors concerning how Casabon and Keevers came to have made virtually identical affidavits, so that the value of their evidence was seriously prejudiced in the manner described by Palmer J in Macquane Developments Pty Ltd & Anor v Forrester & Anor [2005] NSWSC 674 (at [209]-[216]); and

Although reason 5 was not directly addressed by the Appeal Panel, the evidence of Casabon and Keevers was diminished by cross-examination, because the accounts they each gave in cross-examination was inconsistent, they were irreconcilable with the fact that their 2 affidavits were relevantly identical, and their solicitor gave no explanation as to how the identical affidavits were prepared.

In any event, given the hearing was by way of telephone, the Appeal Panel had a recording of the evidence before them, and the Tribunal's findings were not expressed to be demeanour based, the Appeal Panel was in the same position as Tribunal to make factual determinations.
Ground 3(b) does not raise any error of law. It seeks to overturn the Appeal Panel's factual finding that the Tribunal was wrong it its finding that the 2017 Special Levy was imposed for an improper purpose. This was based upon the Appeal Panel's finding that the Tribunal made factual errors concerning (a) Norman Sarraf’s evidence, (b) that the building works the subject of the special levy went beyond what was required by s 106 of the Strata Schemes Management Act, and (c) that the estimated costs of the works were more than was reasonably required (Substantive Decision at [219]).
The Appeal Panel's conclusions in relation to each of those matters was correct for the reasons previously given.
The plaintiff's remaining submissions that the Appeal Panel's findings were internally inconsistent and at odds with other findings of the Tribunal (plaintiff’s submissions at [106]-[111]) are all quintessential factual matters.
In any event, those were matters relied upon by Keevers before the Appeal Panel, they were considered by the Appeal Panel and the Appeal Panel disagreed with them as the Appeal Panel stated:

the Tribunal's finding about the scope and cost of the proposed building work (that informed the special levy) and the Tribunal's finding that Norman Sarraf said that 'such work would never be carried out' were critical aspects of its improper purpose conclusion (at [221]);

the remaining findings and other aspect of Norman Sarraf’s evidence left open the prospect that at the time when the special levy resolution was passed the building works did need to be carried out in order to comply with s 106 and Sarraf Property Group parties – while keen to acquire the plaintiff’s and the Bourke sisters' lots and prepared to exert pressure upon them to sell – did intend to cause the Owners Corporation to carry out such works if the special levy contributions were paid and the defendants did not sell (at [222]); and

while the Appeal Panel was not itself in a position to make a final factual determination, if those were the facts, the Appeal Panel did not see how the raising of the special levy was affected by an improper purpose (at [223]-[224]).

The substance of the plaintiff's submissions is that its factual submissions before the Appeal Panel should have been accepted but were not. That does not demonstrate error, let alone a legal error and the plaintiff's misconceived application for leave to appeal in relation to ground 3(b) should be dismissed.

Resolution

These grounds of Appeal are essentially factual disputes that were ventilated before the Appeal Panel. The Appeal Panel disagreed with some factual findings made by the Tribunal member and provided reasons as to why. According to the Appeal Panel, some of these incorrect factual findings concerned critical aspects of the improper purpose conclusion. In essence, the plaintiff disagrees with the Appeal Panel’s findings. The Appeal Panel is entitled to disagree with specific findings, and conclude that they infected the Tribunal’s decision as to improper purpose. Even if the Appeal Panel is wrong on these factual matters, they are not matters that be dealt with on an appeal to this Court as it is limited to a question of law, if leave to appeal were to be granted. Further, even if this Court could intervene, they are not matters which satisfy the test that leave to appeal should be granted.
It is my view that leave to appeal these grounds of appeal should not be granted as it is reasonably clear that there has not been an injustice in the sense of going beyond what was reasonable arguable that the Appeal Panel was in error. Nor does this ground of appeal raise issues of principle or questions of public importance.

Appeal Ground 4 – costs of the appeal

In Appeal Ground 4, the plaintiff contends that the Appeal Panel erred in finding and ordering that the plaintiff achieved substantial success in the appeal and that the plaintiff should pay their costs of the appeal below.
The Appeal Panel ordered at (6) that the second defendants are to pay the plaintiff’s costs of appeal. It also set aside the orders made by the Tribunal concerning costs. The Appeal Panel ordered that the second defendants are to pay the plaintiff’s costs below. In the Appeal Panel’s costs decision, it stated at [29]-[33] (CB 158-159):

“[29]   First, the events that have transpired since our substantive decision, which we have already referred to, as well as the apparent refusal of the original strata manager to accept a new appointment, have no bearing upon our costs determination, which, in accordance with principle, must be founded upon the outcome of the appeal and any relevant aspects of the conduct of the parties in dealing with the appeal.
[30]   Secondly, the present circumstances are quite different to what occurred in the Johnson case. There, the respondents succeeded in upholding the Tribunal’s decision about liability, whilst the appellant was successful in its challenge to the decision about quantum such that quantum was ordered to be redetermined. By contrast, the respondents did not succeed in upholding any aspect of the Tribunal’s orders which were challenged or any of the key conclusions which supported the relief which was granted.
[31]   Thirdly, whilst it may be appropriate to characterise the outcome as a “mixed” outcome in the sense that the SPG Appellants did not obtain all that it sought on the appeal or succeed on all issues that were put, we regard the SPG Appellants as achieving substantial success in the appeal (see Grain Growers Limited v Chief Commissioner of State Revenue (No 2) [2015] NSWSC 1445 at [20] and [25]) for the following reasons:
(1)   They have succeeded in having all of the orders made by the Tribunal which they challenged overturned.
(2)   Whilst the orders sought by the SPG Appellants on appeal extended to orders dismissing the respondents’ claims in the proceedings and upholding the claims of the owners corporation, overwhelmingly, if not entirely, their grounds of appeal and submissions on appeal were directed at establishing that significant parts of the Tribunal’s fact-finding were flawed rather than establishing that the claims and defences of the owners corporation should succeed on the merits. Such an approach was understandable given the extent of the evidence adduced to the Tribunal and the credit issues that arose.
(3) The first respondent contended that out of 12 grounds of appeal the SPG Appellants failed to succeed on 4 of those grounds, namely Grounds 7, 8, 9 and an additional ground relating to the validity of an appointment to the Strata Committee. However, in fact, the SPG appellants failed to succeed on one of these grounds only, namely Ground 7 (a challenge to the Tribunal’s conclusion that The Owners corporation had contravened s106 of the SSM Act by failing to repair the common stairs). We found it was unnecessary for us to deal with Ground 8 and the additional ground of appeal concerning a finding by the Tribunal in respect of an appointment to the Strata Committee (a matter addressed in our substantive decision at [269] to [272]). We upheld Ground 9 concerning the claim against Ms Bourke for unpaid levies.
(4)   Ground 7 was a subsidiary part of the challenge to the Tribunal’s appointment of a compulsory strata manager (the main part was based upon the Tribunal’s conclusions about the November 2017 special levy). Only a small part of the submissions of the parties was directed to this ground of appeal.

[32]   Fourthly, we fail to see why the SPG Appellants should be refused costs of the appeal because of the matters in paragraph 29 (1), (5) and (6) above.
[33]   As to the matter in paragraph 29 (1), the fact is that the SPG Appellants were joined as parties to the appeal in order to allow the appeal to be prosecuted. That order contained no limitation about their entitlement to costs and the respondents should have been aware that they were at risk of an adverse costs order in favour of the SPG Appellants.
[34]   As to the matter in paragraph 29 (5), on the appeal the respondents argued against the contentions as to the flaws in the Tribunal’s fact-finding. In doing so, they exposed themselves to the risk of an adverse costs order if they were unsuccessful.
[35]   As to the matter in paragraph 29 (6), we have already said that the events which have transpired since our decision are irrelevant to our assessment of costs. As to the potential outcome of a redetermination, similarly, that is a hypothetical matter that can have no bearing on our present assessment.”

The plaintiff’s submissions

In their Amended Notice of Appeal, the relief sought by the Sarraf Property Group was that the application brought by Keevers (and Bourke and Fardell) should be dismissed and, in the debt recovery proceedings, that all orders sought by the Owners Corporation (that is judgment against Keevers and Bourke and Fardell for the full amount of the 2017 Special Levies) be made: see para 5 of Amended Notice of Appeal.
None of this relief was granted by the Appeal Panel which instead set aside the orders of the Tribunal (except for those reducing the 2017 Special Levies from $980,000 to $80,000) and remitting the whole of all proceedings to a differently constituted Tribunal for redetermination. This outcome was not within the scope of the relief sought by the Sarraf Property Group.
In these circumstances, Keevers submitted (for the reasons that are summarised at [28] of the costs decision) that there were several factors which militated against the Sarraf Property Group being awarded their costs of the appeal. Nevertheless, the Appeal Panel ordered that Keevers pay the Sarraf Property Group costs of the appeal. In ordering, the Appeal Panel found that:

the defendants did not succeed in upholding any aspect of the Tribunal's orders: AP Reasons costs [30]; and

while the outcome of the appeal was "mixed" (in that the Sarraf Property Group did not obtain all that was sought on the appeal or succeed on all issues that were put), the Sarraf Property Group nevertheless achieved substantial success in the appeal.

These findings were erroneous for the following reasons.
First, it was incorrect for the Appeal Panel to find that the defendants before it did not succeed in upholding any aspect of the Tribunal's orders. To the contrary, as a matter of substance, the Appeal Panel upheld the practical effect of the Tribunal's orders in that the 2017 Special Levies were reduced from $980,000 down to $80,000 (and made any further aspects of the 2017 Special Levies subject to a further hearing and redetermination by the Tribunal). Such an outcome was what, in substance, Keevers was seeking to achieve in the proceedings he was bringing and was at odds with the relief sought by the Sarraf Property Group in the appeal (which was judgment against Keevers).
Second, having correctly found that the outcome of the appeal was "mixed", the Appeal Panel should not have gone on to find that the Sarraf Property Group achieved substantial success in the appeal. This is because the Sarraf Property Group did not achieve any, or most, of the relief sought in the appeal. In particular, they were unsuccessful in obtaining a judgment against Keevers. The substantive relief which the Sarraf Property Group apellants did achieve (namely the remittal of the proceedings to a new Tribunal) was not something which they had sought in the appeal.
Third, in circumstances where: (i) the outcome of the appeal was "mixed", and the substantive relief granted on appeal was a remittal for further determination (giving rise to the possibility that Keevers may succeed, and the Owners Corporation (and Sarraf Property) may fail, in relation to the proceedings as a whole; and (ii) the Sarraf Property Group were joined as plaintiffs having elected not to participate in the proceedings below, the appropriate and proper exercise of the Appeal Panel's discretion with respect to costs entailed an outcome either that each party to the appeal should bear its own costs of the appeal or alternatively that the costs of the appeal should abide the outcome of the remitted proceedings.

The defendants’ submissions

The plaintiff’s submissions concerning costs concern factual contentions, which were made to and rejected by the Appeal Panel. Neither the plaintiff’s appeal nor his submissions raise any error of law, let alone an error of law that would justify the Supreme Court granting leave to appeal in relation to the costs. Keevers would need to identify a House v The King [1936] HCA 40; 55 CLR 499 error. He has not.
Even if the plaintiff were able to establish a legal error in the Appeal Panel’s discretionary decision, leave to appeal ought not be granted given the use of court resources. Appeals as to costs alone must be scrutinised closely to determine whether such a use of resources is in the public interest: see Huang v Attapallil & Ors [2017] NSWCA 181, Corcoran v Far [2020] NSWCA 140 at [23].
In any event, the Appeal Panel did not make the factual errors asserted by Keevers:

contrary to the plaintiff’s submissions at [117], he did not succeed in upholding the Tribunal’s $80,000 levy as matter of substance or at all, because, as the Appeal Panel noted (Costs Decision at [22]), that was an unchallenged element of the Tribunal s variation being a levy of $80,000 in respect of the repairs to the stairs, being work that was unrelated to the special levy raised in November 2017;

as noted by the Appeal Panel, the Sarraf Property Group parties succeeded in having all of the orders made by the Tribunal which they challenged overturned (Costs Decision at [31(1)]. That included the Sarraf Property Group parties successful challenge to the Tribunal's decision concerning the special levy of $980,000, with all claims relating to that levy having to be redetermined (Costs Decision at [21]);

As noted by the Appeal Panel (Costs Decision at [30]), Keevers did not succeed in upholding any aspect of the Tribunal’s orders which were challenged or any of the key conclusions which supported the relief which was granted;

The Sarraf Property Group parties achieved substantial success for the reasons articulated by the Appeal Panel (Costs Decision at [31]); and

The Appeal Panel specifically considered and rejected the matters raised by the Keevers at [119] of his submissions (Costs Decision [33]-[35]).

In essence, the plaintiff repeats his submissions made before the Appeal Panel, and asks this Court to re-exercise the costs discretion in its favour. The plaintiff has not demonstrated any error, let alone any error of law.

Resolution

This ground can briefly be dealt with here. Costs are discretionary. The Appeal Panel, in its costs decision at [29]-[35] provided detailed reasons as to why they made the decision about who should pay the costs of the hearing before the Tribunal Member. At [31], the Tribunal Member stated that while it may be appropriate to characterise the outcome as a “mixed” outcome in the sense that the Sarraf Property Group did not obtain all that it sought on the appeal or succeeded on all issues that were put, that they regarded the Sarraf Property Group as achieved substantial success in the appeal. The Appeal Panel also provided persuasive reasons, the main one being that Sarraf Property Group and Palonis succeeded in having all the orders made by the Tribunal which they challenged overturned (at [31]).
It is my view that leave to appeal should not be granted with regards to these appeal grounds as to costs, as it is reasonably clear that there has not been an injustice in the sense of going beyond what was reasonable arguable that the Appeal Panel was in error. Nor do these grounds of appeal as to costs raise issues of principle or questions of public importance.

Result

After carefully examining the plaintiff’s grounds of appeal in detail, in my reasoning of each appeal ground and then taking an overall appraisal of the cumulative effect of the Appeal Panel’s reasons, I am not satisfied that the appeal raised an injustice in the sense of going beyond what is reasonably arguable that the Appeal Panel was in error. The appeal grounds do not raise any matters of principle nor do they raise any questions of public importance. Leave to appeal is refused. The result is that the plaintiff’s application of appeal fails. The summons is to be dismissed.
The result is that leave to appeal is refused. The amended summons dated 26 October 2021 is dismissed.

Costs

Costs follow the event. The plaintiff is to pay the defendants costs of this Appeal.

The Court orders:

Leave to appeal pursuant to s 83(1) of the Civil and Administrative Tribunal Act 2013 (NSW) is refused.
The amended summons filed 26 October 2021 is dismissed.
The stay orders made on 8 July 2022 in this Court are dissolved.
The plaintiff is to pay the defendants’ costs.

**********

Decision last updated: 28 July 2022

Medium Neutral Citation:	Keevers v Sarraf Property Group Pty Ltd [2022] NSWSC 1017
Hearing dates:	8 March 2022
Date of orders:	28 July 2022
Decision date:	28 July 2022
Jurisdiction:	Common Law
Before:	Harrison AsJ
Decision:	(1) Leave to appeal pursuant to s 83(1) of the Civil and Administrative Tribunal Act 2013 (NSW) is refused. (2) The amended summons filed 26 October 2021 is dismissed. (3) The stay orders made on 8 July 2022 in this Court are dissolved. (4) The plaintiff is to pay the defendants’ costs.
Catchwords:	ADMINISTRATIVE LAW – NCAT Appeal – Leave to appeal – Whether the Appeal Panel erred in joining parties – Whether there was an injustice going beyond what was reasonably arguable – Whether there is an issue of principle or a question of public importance – Appeal dismissed
Legislation Cited:	Civil and Administrative Tribunal Act 2013 (NSW) ss 44, 80 Strata Schemes Development Act 2015 (NSW) Part 10 Strata Schemes Management Act 2015 (NSW) ss 86, 87, 237 to s 86 Strata Schemes Management Act Uniform Civil Procedure Rules 2005 (NSW) r 6.19
Cases Cited:	Adam P Brown Male Fashions v Phillip Morris (1981) 148 CLR 170 Administration of Papua New Guinea v Daera Guba (1972) 130 CLR 353 Australian Railways Union v Victorian Railways (1971) 125 CLR 319 Be Financial Pty Ltd as Trustee for Be Financial Operations Trust v Das [2012] NSWCA 164 Browne v Dunne (1893) 6 R 67 Commissioner of Police, New South Wales Police Force v Fine [2014] NSWCA 327 Corcoran v Far [2020] NSWCA 140 Coulter v R [1988] HCA 3; 164 CLR 350 Fox v Percy (2003) 214 CLR 118; [2003] HCA 22 Glenquarry Park Investments Pty Ltd v Hegyesi [2019] NSWSC 1120 House of Spring Gardens Ltd v Waite [1991] 1 QB 241 House v The King [1936] HCA 40; 55 CLR 499 Huang v Attapallil & Ors [2017] NSWCA 181 Kuhl v Zurich Financial Services Australia [2011] HCA 11; (2011) 243 CLR 361 Lee v New South Wales Crime Commission (2012) 224 A Crim R 94; [2012] NSWCA 262 Macquane Developments Pty Ltd & Anor v Forrester & Anor [2005] NSWSC 674 Nana Ofori Atta II v Nana Abu Bonsra II [1958] AC 95 at 102 Nominal Defendant v Manning (2000) 50 NSWLR 139, [2000] NSWCA 80 Osborne v Smith (1960) 105 CLR 153 PPK Willoughby v Baird [2019] NSWCA 48 Rice Marketing Board for the State of New South Wales v Forbidden Foods Pty Limited; Forbidden Foods Pty Limited v Rice Marketing Board for the State of New South Wales [2020] NSWCATAP 182 Rosenberg v Percival (2001) 205 CLR 434; [2001] HCA 18 Tan v Owners Corporation Strata Plan 22014 (No 2) [2015] NSWSC 1920
Category:	Principal judgment
Parties:	Francis Keevers (Plaintiff) Sarraf Property Group Pty Ltd (First Defendant) Konn Palonis (Second Defendant) Owners of Strata Plan 1813 (Third Defendant) Peta Bourke (Fourth Defendant) Joanna Fardell (Fifth Defendant)
Representation:	Counsel: S. Philips (Plaintiff) G. Sirtes SC (First, Second and Third Defendants) Solicitors: Terret Lawyers (Plaintiff) Madison Marcus (First, second and Third Defendants)
File Number(s):	2021/237102
Publication restriction:	Nil
Decision under appeal	Court or tribunal: Civil and Administrative Tribunal of New South Wales Jurisdiction: Appeal Panel Citation: NSWCATAP 130 Date of Decision: 12 May 2021; 22 July 2021; 30 July 2021; Before: P Durack SC, Senior Member D Robertson, Senior Member File Number(s): 2020/00370815 (AP 20/23648)