Lienhart v Sunrise Homes Pty Ltd - [2010] QCAT 156

CITATION: Lienhart v Sunrise Homes Pty Ltd [2010] QCAT 156

PARTIES: Edgard Lienhart and Marie-Harriet Lienhart

v
Sunrise Homes Pty Ltd (now known as Kennedy Civil Pty Ltd)

APPLICATION NUMBER: BD406-06

MATTER TYPE: Building matters

HEARING DATE: on the papers

HEARD AT: Brisbane

DECISION OF: Peta Stilgoe

DELIVERED ON: 13 January 2010

DELIVERED AT: Brisbane

ORDERS MADE: Each party bears their own costs of the proceedings.

CATCHWORDS: costs, offers to settle

APPEARANCES and REPRESENTATION (if any):

Edgard & Marie-Harriet Lienhart represented by Stuart Latham of Lathams Lawyers

Sunrise Homes Pty Ltd represented by Christian Moore of Aegis Legal

REASONS FOR DECISION

On 14 December 2009, I ordered that the applicants’ claim be dismissed. I invited the parties to make submissions as to costs. The applicants are content with no order as to costs, citing the QCAT legislation and rules. The respondent wants its costs paid on an indemnity basis.

The respondent’s grounds for claiming indemnity costs are:
a.The respondent made numerous settlement offers and the decision of the tribunal was no more favourable to the applicant than those offers.
b.The applicant’s proceedings were unreasonable.
c.The interests of justice, following the principles in Tamawood Limited –v- Paans [2005] QCA 111, (“Tamawood”) warrant an order for costs.

Applicable law

Section 271 of the Queensland Civil and Administrative Tribunal Act (“QCAT Act”) states that, in relation to an existing matters, QCAT can only make a decision that the former entity could have made. Therefore, my ability to award costs is governed by the provisions of the Commercial and Consumer Tribunal Act, not the QCAT legislation.

Settlement offer

Section 142(2) of the Commercial and Consumer Tribunal Act stated that, if:
a)A party to a proceeding serves another party to the proceeding with a written offer to settle the matters in dispute between the parties; and
b)The other party does not accept the offer within the time is open; and
c)The offer complies with this division; and
d)In the opinion of the tribunal, the decision of the tribunal on the matters in dispute is not more favourable to the other party than the offer;
the tribunal must award the party who made the offer all reasonable costs incurred by that party in conducting the proceeding after the offer was made.
Section 138 requires that:
·an offer must be made by signed writing served on the party to whom the offer relates.
·If it provides for payment of an amount, the offer must state when the amount is to be paid and to whom.

By email of 27 August 2008, the respondent offered to settle the dispute as follows:
As to the defect issue identified by the QBSA report dated 25 July 2008:
1.the respondent will pay the applicants the sum of $500 in full and final settlement of this matter;
2.the parties agree to provide their authority to release the CCT settlement monies ($19,190) presently held in the CCT account on the following basis:
a)The sum of $500 to the Applicants…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2010] QCAT 156
Decision Date: 13 January 2010

CaseChat Overview and Summary

In the case of Lienhart v Sunrise Homes Pty Ltd, the applicants, Edgard and Marie-Harriet Lienhart, brought an action against Sunrise Homes Pty Ltd (now known as Kennedy Civil Pty Ltd) before the Queensland Civil and Administrative Tribunal (QCAT). The applicants' claim related to building matters, specifically concerning defects and the handling of settlement funds. Following a decision by Peta Stilgoe on 14 December 2009 to dismiss the applicants' claim, submissions were made regarding the allocation of costs. The applicants were content with no order for costs, whereas the respondent sought an indemnity costs order.

The legal issues before the court included whether the respondent's settlement offers complied with the statutory requirements under the Commercial and Consumer Tribunal Act, and if the applicants' conduct was unreasonable such that it warranted an award of indemnity costs. Additionally, the court considered the principles of justice as outlined in Tamawood Limited v Paans, which emphasised the importance of ensuring that just claims are not deterred by the costs of litigation.

The court found that while the respondent had made several settlement offers, none of them strictly complied with the statutory requirements for such offers, particularly regarding the specification of payment details. Consequently, the court could not award costs based on these offers. Furthermore, the court acknowledged the applicants' failure to accept the offers but highlighted that the respondent did not draw attention to the potential consequences of rejecting these offers. The court also noted that the applicants' continuation of the claim was not unreasonable, given the mediation agreement and the complexity introduced by the parties' non-compliance with the building contract. While the applicants' refusal to release funds was deemed unreasonable from a commercial perspective, the court considered broader factors, including the respondent's own breaches of the Domestic Building Contracts Act.

Ultimately, the court ruled that each party should bear their own costs of the proceedings. The court did not find the applicants' conduct to be unreasonable to the extent that it warranted an award of indemnity costs, nor did it deem the principles of justice as outlined in Tamawood to apply in favour of the respondent. Consequently, the final orders were that each party bears their own costs of the proceedings.

Orders