Lai & Anor and Costa
[2006] WASAT 117 (S)
•12 MAY 2006
| JURISDICTION | : STATE ADMINISTRATIVE TRIBUNAL | ||
| STREAM | : COMMERCIAL & CIVIL | ||
| ACT |
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| CITATION |
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| MEMBER |
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| HEARD |
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| DELIVERED | : 12 MAY 2006 | ||
| SUPPLEMENTARY | |||
| DECISION | : 5 JULY 2006 | ||
| FILE NO/S |
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| BETWEEN | : TET SIN LAI |
CHEE YIN CHONG
Applicants
AND
PETER RAYMOND COSTA
Respondent
Catchwords:
Review of decision of Building Disputes Tribunal – Award of costs
Legislation:
Builders' Registration Act 1939
(WA), s 38(3), s 38(4) s 87(4), s 89
[2006] WASAT 117 (S)
Result:
Application successful in part
Category: B
Representation:
Counsel:
| Applicants | : | Self-represented |
| Respondent | : | Mr R Tan |
Solicitors:
| Applicants | : | Self-represented |
| Respondent | : | Tan & Tan Lawyers |
Case(s) referred to in decision(s):
Nil
Case(s) also cited:
Nil
[2006] WASAT 117 (S)
REASONS FOR DECISION OF THE TRIBUNAL:
Summary of Tribunal's decision
1 The applicants succeeded in review proceedings in obtaining from
the State Administrative Tribunal orders setting aside a decision of the Building Disputes Tribunal, and substituting orders awarding increased compensation, but otherwise dismissing the complaint to the Disputes Tribunal, save in respect of costs. Directions were issued to enable all costs claimed to be identified and determined. The costs claimed fell into two categories. Firstly, the costs of expert witness fees and reports obtained for use in the Disputes Tribunal proceeding and, secondly, costs incurred in the proceedings before the State Administrative Tribunal.
The State Administrative Tribunal referred to the provisions of s 87 of the State Administrative Tribunal Act 2004 (WA) which established that the starting point was that each party should bear its own costs but that there was a general discretion nevertheless to make an award of costs. In review proceedings, regard had to be had to whether the applicant had genuinely attempted to enable and assist the decision-maker to make a decision on its merits.
3 The State Administrative Tribunal held that great care should be
taken in exercising power to award costs to ensure that accessibility to the State Administrative Tribunal is not affected. Nevertheless there is a distinction between its general review jurisdiction, which relates to decisions made by government, local authorities, and other bodies, and is a true administrative decision review process and the legislative scheme for the review of decisions of the Building Disputes Tribunal. The State Administrative Tribunal recognised that there were circumstances in which an inability to recover costs on review could have the effect of excluding review or, in some circumstances, might discourage use of the Building Disputes Tribunal in favour of the Court system to preserve a right to recover costs on appeal. Such circumstances were held to be relevant in exercising the State Administrative Tribunal's discretion in relation to costs.
4 The State Administrative Tribunal concluded that the costs incurred
in the review proceedings were relatively incidental to the benefit obtained from the order on review and were insignificant when account was taken of all claims made in the review process. In these circumstances, the State Administrative Tribunal held that there was no sufficient reason for the State Administrative Tribunal to move from the starting position that each party should bear their own costs.
[2006] WASAT 117 (S)
5 The State Administrative Tribunal assessed the costs claimed in
respect of expert witness fees and reports in respect of the proceedings before the Disputes Tribunal and made an order in substitution for the decision under review, awarding the applicants the costs of the proceedings before the Disputes Tribunal in the sum of $3641.63. It was further ordered that each party bear its own costs in respect of the review proceedings.
The award of costs
6 On 12 May 2006, the State Administrative Tribunal (the Tribunal)
made orders in favour of the applicants, setting aside a decision of the Building Disputes Tribunal (the Disputes Tribunal) reflected in an order to pay, dated 5 May 2005, substituting its own decision, and awarding increased compensation but otherwise dismissing the complaint, save in respect of costs.
7 Orders were made giving the applicants leave to file and serve an
affidavit setting out fully all costs and expenses claimed by them and annexing vouchers for the same. The respondent was granted leave to file and serve written submissions opposing the application for costs, either in whole or in respect of particular costs and expenses claimed. It was further ordered that unless the Tribunal directed otherwise, that the amount of costs and expenses to which the applicants may be entitled shall be determined on the documents.
8 The parties having complied with the above directions. It is for the
Tribunal to determine the application for costs, and if granted, fix the sum to which the applicants are entitled.
9 Under s 87(1) of the State Administrative Tribunal Act 2004 (WA) (SAT Act) it is provided that unless otherwise specified in the SAT Act, the enabling act, or an order of the Tribunal under this section, parties bear their own costs in a proceeding of the Tribunal. However, a broad discretion is granted to the Tribunal under s 87(2) to the effect that unless otherwise specified in the enabling act, the Tribunal may make an order for the payment by a party of all or any of the costs of another party.
10 Under s 87(4) of the SAT Act, the Tribunal is directed that in relation
to proceedings within its review jurisdiction, the Tribunal is to have regard to whether the applicant genuinely attempted to enable and assist the decision-maker to make a decision on its merits.
[2006] WASAT 117 (S)
11 In proceedings before the Disputes Tribunal under the Builders' Registration Act 1939 (WA) (BR Act), s 38(3) specifically empowers the Disputes Tribunal to make such order for costs, other than costs for the service of a legal practitioner, as it thinks fit. Subsection 38(4) to which subsection (3) is expressed to be subject, provides that costs are not to be awarded to any party for the services of any legal practitioner except in circumstances which are prescribed in that section.
12 Prior to the coming into effect of the SAT Act on 1 January 2005, the
review of decisions of the Building Disputes Tribunal lay by way of an appeal to the District Court of Western Australia. In accordance with the rules of that Court, costs were awarded in accordance with the usual cost principles.
13 In this matter, the applicants were not legally represented before the
Disputes Tribunal or this Tribunal. But the extent of matters in dispute, and the need to establish remedial costs, required the engagement of a building consultant, Mr Knowles, and a quantity surveyor, Mr Rafferty, at a not considerable expense. The total amount of costs claimed in respect of these persons, the obtaining of a transcript of the proceedings before the Disputes Tribunal and various sundry charges amount to $4929.07.
The respondent was legally represented before this Tribunal.
15 Having regard to the provisions of s 87 of the SAT Act to which
reference has been made above, the intent of the legislation is clear that the starting point in any consideration of an application for costs, is that each party should bear their own costs. It is intended that the Tribunal should remain readily accessible to the public at relatively low cost, and in particular, that the Tribunal should act as speedily and with as little formality and technicality as is practicable and minimise the costs to parties as is expressly prescribed in s 9 of the SAT Act. Accordingly, great care should be taken in exercising a power to award costs to ensure that accessibility to the Tribunal is not affected.
16 It is however, relevant that the Disputes Tribunal has an unfettered
discretion to award costs (other than costs of a legal practitioner) in proceedings before it. Some of the costs now claimed are properly costs which could have been awarded by the Disputes Tribunal. In the order made by this Tribunal on 12 May 2006, the decision under review was set aside, and substituted by orders for the payment of compensation and otherwise dismissing the complaint, save in relation to costs. The Tribunal will identify those costs which, if they are to be awarded, will be
[2006] WASAT 117 (S)
awarded as part of the principal order substituted for that of the Disputes Tribunal. But even so, there is approximately $1000 in costs claimed in respect of the obtaining of a transcript and copying of documents which do properly form part of the costs of these proceedings.
17 The legislative scheme for the review of decisions of the
Disputes Tribunal is different to the Tribunal's general review jurisdiction which relates to decisions made by government, local authorities, and other bodies, which is a true administrative decision review process. The parties in proceedings before the Disputes Tribunal are private persons engaged in adversarial litigation.
18 There will be some cases in which an injustice could result by not
allowing costs to be recovered. In this particular area of jurisdiction, it is frequently the case that costs have to be incurred in engaging engineering or building consultants. The inability to recover costs may, in some circumstances, have the practical affect of precluding an application being made because even when the prospects of success are considered to be high, the final benefit achievable after deduction of irrecoverable costs, may not justify the proceedings. Such a result would not be in the public interest.
19 At the other end of the spectrum, the complexity of issues raised or
the value of a claim the subject of a complaint to the Disputes Tribunal, may have the result that the applicant, or even both parties, wish to have legal representation from the outset. If there is sufficient at stake, consideration will be given to the possibility that whatever the result, one of the parties will wish to have the decision reviewed. In such circumstances, the inability to recover costs may be an important consideration, so that an applicant may prefer to commence proceedings in a court, rather than before the Disputes Tribunal. The Disputes Tribunal was established in the public interest to provide a cost effective and prompt method of dispute resolution in building cases. The Disputes Tribunal is a specialist tribunal which requires that its chair be a legal practitioner and that the other members be drawn from two panels, one representing consumer interests and the other representative of the interest of builders, to facilitate that purpose. If the cost of legal representation, and even expert witness fees, could not be recovered in the review proceedings, that may therefore, impact on the use of the Disputes Tribunal, and deny any review role by this Tribunal. It is relevant in considering an application for costs for the Tribunal to take such factors into account.
[2006] WASAT 117 (S)
20 Subject therefore to the starting position being that in proceedings
before this Tribunal each party should bear its own costs, it must be recognised that the Tribunal nevertheless has a broad discretion in relation to costs, in the exercise of which, factors such as the above, may be taken into account, together with the particular circumstances of each case.
21 In this matter there can be no doubt that the applicant endeavoured to
put its case properly before the Disputes Tribunal, and thereby genuinely attempted to enable and assist the Disputes Tribunal to make a decision on its merits.
22 The Disputes Tribunal awarded the applicants compensation in an
amount of $11 400. On review by this Tribunal that compensation was increased to almost $32 000. The applicants claimed far in excess of that amount, so that the costs incurred in these proceedings, excluding in relation to Messrs Rafferty and Knowles, which were incurred in the proceedings before the Disputes Tribunal, amount to $1097.70. This is relatively incidental to the benefit obtained from the order on review. When the additional claims advanced on review by the applicants, which were dismissed, are taken into account, the costs are insignificant.
23 In these circumstances, there appears to be no sufficient reason for
the Tribunal to move from the starting position that each party should bear their own costs. An order will be made to that effect, in relation to the review proceedings.
24 In relation to the costs incurred before the Disputes Tribunal, the
respondent submits that the fees claimed in respect of Messrs Knowles and Rafferty are extravagant and not catered for within the earlier decision of this Tribunal made on 12 May 2006. The latter aspect of this submission is rejected. The Tribunal stated quite clearly in the earlier decision that subject to the submissions of the respondent, the applicants should be able to recover the costs of obtaining Mr Knowles' report and for his attendance in the hearing as a witness. Further, it was stated that the applicants were justified in obtaining the quantity surveyor's report when they did, and that they should be entitled to the costs for doing so. It was noted that the applicants would not have been able to prove any of their claims without that report.
25 The applicants claim reimbursement for three invoices rendered by
Mr Knowles. The first invoice, dated 22 April 2004, was for the carrying out of a building inspection and preparation of a report, in a total amount, inclusive of GST, of $374. There is no rate per hour given for the
[2006] WASAT 117 (S)
preparation of the report but it was a comprehensive document raising many items of dispute. It formed the basis upon which the entire case was structured. Having regard to the number of items, the Tribunal considers that the inspection is likely to have taken some hours, probably two to three hours, and that the report itself would have taken at least one to two hours to draft and settle. In the circumstances, the fee charged is considered to be modest and is clearly fair and reasonable. The full amount will be allowed.
26 The next account from Mr Knowles is dated 16 November 2004 in
an amount of $664.12. It relates to a site inspection conducted on 4 November 2004 for which a charge has been raised for three hours time at $105 per hour plus GST. It also includes a meeting with the quantity surveyor on 15 November 2004 for which 2.7 hours at $105 per hour plus GST has been charged.
27 The purpose of the meeting on 4 November 2004 is not explained.
The respondent had not then carried out any remedial work which needed to be checked. It may be that Mr Knowles considered it to be prudent to review the site in the context of his earlier April report, in preparation for the meeting with Mr Rafferty. Although the meeting with Mr Rafferty is not explained, it was prudent and reasonable for Mr Knowles to meet the quantity surveyor on site because it is fundamental to the preparation of cost estimates that the methodology for remedial work be properly understood. That would have required liaison between Mr Knowles and Mr Rafferty. The rate charged and the time spent at the meeting with Mr Rafferty was reasonable and necessary and will be allowed in full. In relation to the site inspection on 4 November 2004, an amount of $105, plus GST, equivalent to 1 hour of time will be allowed on the basis that due to the lapse of time preparation and refreshing for the hearing which Mr Rafferty was justified. In respect of the 16 November 2004 account therefore a total amount of $543.13 will be allowed.
The next claim in respect of Mr Knowles is for an amount of $288.75 which is sworn to relate to his witness fee for attendance before the Disputes Tribunal. No account from Mr Knowles has been produced, but the applicants have provided a copy of a bank statement which shows a debit on 3 May 2005 in the amount claimed and with the description "ordersdisputetribltetlai". It is noted that the Disputes Tribunal allowed an amount of $200 in respect of Mr Knowles' witness fee. It is impossible to assess accurately from the transcript the amount of time for which Mr Knowles was present at the hearing. The Disputes Tribunal was in a
[2006] WASAT 117 (S)
good position to assess an appropriate allowance and in all the
circumstances the same amount of $200 will be allowed.
The amount claimed in respect of Mr Rafferty's fees is $2524.50. Mr Rafferty's account, dated 22 December 2004, reflects that his fee is based on 17 hours of time charged at a rate of $135 per hour plus GST. It relates to a site visit and the preparation of his written report on the cost of remedial and rectification works. The amount charged is considered fair and reasonable and will be allowed in full.
30 The total amount therefore to be allowed the applicants in respect of
| the costs which should have been awarded in the Disputes Tribunal is $3641.63. |
| Order |
For the above reasons, the Tribunal orders as follows.
1. Pursuant to the order of the Tribunal made on 12 May 2006, in substitution for the decision under review, the costs of the proceedings before the Disputes Tribunal are awarded to the applicants in the sum of $3641.63;
2. Each party is to bear its own costs in respect of the review proceedings.
I certify that this and the preceding [31] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
___________________________________ MR C RAYMOND, SENIOR MEMBER
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