Malay Industries Pty Ltd v Queensland Building Services Authority
[2010] QCAT 310
•30 June 2010
| CITATION: | Malay Industries Pty Ltd v Queensland Building Services Authority [2010] QCAT 310 |
| PARTIES: | Malay Industries Pty Ltd |
| v | |
| Queensland Building Services Authority |
| APPLICATION NUMBER: | QR286-08 |
| MATTER TYPE: | General administrative review matters |
| HEARING DATE: | On the papers |
| HEARD AT: | Brisbane |
| DECISION OF: | Ms Sharon Christensen |
| DELIVERED ON: | 30 June 2010 |
| DELIVERED AT: | Brisbane |
ORDERS MADE: | 1. The Applicant will pay the Respondents costs of and incidental to the proceedings prior to 5 February 2009 on a standard basis on the District Court Scale as agreed or failing agreement, as assessed. 2. The Applicant will pay the Respondents reasonable costs on an indemnity basis of conducting the proceedings on and from 5 February 2009 on the District Court scale as agreed, or failing agreement, as assessed. 3. The Respondent’s costs will be assessed as follows: (a) The Respondent will deliver to the Applicant an itemised claim for costs referring to the relevant items contained in the scale; and (b) If within 14 days of that delivery, the parties have not agreed to an amount for costs, the costs shall be assessed by Hickey & Garrett, Legal Costs Assessors, Level 21, 141 Queen Street Brisbane. 4. The Applicant will pay the Respondent’s costs (as agreed or assessed) within fourteen (14) days of such agreement or assessment. |
| CATCHWORDS : | Application for costs, consideration of sections 70, 71, 138, 142 of the Commercial and Consumer Tribunal Act and discretionary factors. |
APPEARANCES and REPRESENTATION (if any):
The application was determined on the papers.
REASONS FOR DECISION
Introduction
The Applicant applied to the Commercial and Consumer Tribunal (CCT) for review of the Respondent’s decision to cancel the Applicant’s licence pursuant to section 53A(3) of the Queensland Building Services Authority Act 1991 (Qld) (QBSA Act) (Application for Review). The Application for Review was dismissed by the CCT on 18 June 2009.
The Respondent made application to the CCT on 17 September 2009 for the Applicant to pay the Respondents costs of the proceeding (Application for Costs).
Factual Background
On or about 21 July 2008, the Respondent suspended the Applicant’s building licence pursuant to sections 38(1) and 53A(3) of the QBSA Act for a failure to pay the licence fee and provide necessary financial information.
On 11 November 2008, the Respondent cancelled the Applicant’s licence pursuant to the provisions of section 53A(3) of the QBSA Act.
On 19 December 2008, the Applicant lodged the Application for Review with the CCT requesting a stay of the cancellation.
On 5 February 2009, the Respondent sent a letter to the Applicant making an offer to settle pursuant to section 138 Commercial and Consumer Tribunal Act 2003 (CCT Act).
The offer to settle was not accepted by the Respondent.
On 8 April 2009 the CCT dismissed the application for a stay and on 20 April 2009 the CCT ordered the Applicant to file their statements of evidence by 4.00pm on 25 May 2009.
No statements were filed by 25 May 2009.
On 10 June 2009, a further order was made to file statements of evidence by 4.00pm on 17 June 2009.
No statements were filed by 17 June 2009.
On 18 June 2009, the CCT dismissed the Applicant’s review application.
The Respondent made an offer to settle the matter of costs on 1 July 2009, which was not accepted.
Jurisdiction
The jurisdiction of QCAT to deal with applications made to former tribunals appears in Chapter 7 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act). Jurisdiction is given to QCAT to deal with a proceeding started before a former tribunal that is either a ‘pending proceeding’ (section 256) or an ‘other proceeding’ (section 257).
A ‘pending proceeding’ is defined in section 245 to be an existing proceeding in a court or former tribunal where, at the date of commencement of the QCAT Act, the former tribunal:
(a) has not started to hear a matter the subject of the proceeding; or
(b) has started to hear a matter the subject of the proceeding but has not started to consider evidence for the purpose of making its final decision in the proceeding.
A final decision (as defined in section 244 QCAT Act) was made by the CCT in relation to the Application for Review on 18 June 2009. Therefore, there was no pending proceeding between the Applicant and Respondent on the date of commencement.
The Application for Costs is therefore an ‘other proceeding’ under section 257 QCAT Act which provides for:
(a)the proceeding to be a proceeding before QCAT and
(b)that QCAT has jurisdiction to deal with the matter the subject of the proceeding under this Act.
However, as held in Owen v The Adams Group Pty Ltd t/a Richard Adams Homes Downs Earthmoving Pty Ltd [2010] QCAT 10, both of these sections must be read in conjunction with section 252(3) QCAT Act, which provides for applications before a former tribunal to deal with a ‘final decision’ of that tribunal. The definition of ‘deal with a decision’ refers inclusively to applications to amend, revoke or correct a final decision. I agree with the finding of Member Oliver in Owen v The Adams Group Pty Ltd t/a Richard Adams Homes Downs Earthmoving Pty Ltd [2010] QCAT 10 that this does not preclude the finding that an Application for Cost is also an application to deal with a final order.
According to sections 252(2) and (3) QCAT Act, an application to deal with a final order of a former tribunal is an application under the QCAT Act but QCAT must only deal with the application in a manner consistent with the former tribunals powers. Therefore, when considering the application for costs, the relevant matters for consideration are those contained in the former CCT Act.
The Respondent has sought costs to be assessed for the proceedings from the date of commencement (19 December 2008) to 4 February 2009 and then pursuant to section 142 CCT Act after 4 February 2009.
Costs from 4 February – after offer to settle
The Respondent made an offer to settle the Application for Review on 5 February 2009. This offer was made pursuant to Division 7 of Part 7 of the CCT Act.
The Respondent claims its ‘reasonable costs’ of the proceedings from 4 February 2009 under section 142 CCT Act. Section 142(1) of the CCT Act states that it applies, 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.
If section 142(1) applies 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 142(2)).
I am satisfied that the offer of 5 February 2009 complied with section 138 as it was in writing and served on the party to whom the offer related.
The offer to settle was not accepted by the Applicant.
I am satisfied that the decision of the tribunal was not more favourable to the other party than the offer. Therefore, I am required to award the respondent all reasonable costs incurred in conducting the proceeding after the offer was made, that is 5 February 2009. See Peat v Payne [2006] QCCTB 127.
The respondent seeks indemnity costs but did not refer to any authority for that submission.
In Marshall, K. H & Ken & Daryl Marshall Pty Ltd v Seckhold, D.G & G [2005] QCCTR 60 (18 April 2005), Member Lohrisch considered the meaning of "reasonable costs" in the context of section 142(2) of the CCT Act, and made the following comments:
"[53] It falls now to determine what is meant by "reasonable costs" in section 142(2) of the CCT Act. The reference is in fact to ".. .all reasonable costs incurred by that party in conduct of the proceeding. .."
[54] It seems to me by use of the words "all" and "incurred" in the subsection, what is meant is indemnity/ solicitor and own client costs, and that the only qualification is that such costs are to be "reasonably" incurred. As to what is "reasonable" in terms of indemnity costs, I note the decision of the Chief Justice in Bottoms v Reser [2000] QSC 413 in which he said that indemnity costs cover all costs, except insofar as the amount may be unreasonable, or where they were unreasonably incurred. The Chief Justice considered that such an assessment should be undertaken in the context of the following -
a. The approach of the registrar in assessing the costs should take into account the concept that the receiving party will be given the benefit of any doubt.
b. Considerable liberality should ordinarily be extended in assessing reasonableness.
c. No niggardly or unduly narrow approach would be warranted.
d. Whether an item is unreasonable is to be considered in the overall context, which would include the terms of the agreement between the Client and the Solicitor."
This decision was followed in Energy Efficient Houses Pty Ltd –v- Byrne & Sheldon t/a Sheldon and Byrne Painting Contractors [2009] QCCTB. However, a contrary view was expressed in relation to section 142 by Member Stilgoe in Leo v Paulsen [2010] QCAT 122 on the basis that “
in jurisdictions where costs normally follow the event, the cost disincentive must necessarily be something more punitive than would otherwise be available. In that context, an award of indemnity costs is reasonable. If the starting point in the tribunal is that each party should bear its own costs, I see no sensible reason for the entitlement to costs to be anything more than standard costs.
Despite the differing views, I accept the view that the expression “all reasonable costs” in section 142 of the CCT Act is capable of referring to indemnity costs. Reasonable indemnity costs should therefore be awarded to the Respondent from 5 February 2009.
Costs from 19 December 2008 to 4 February 2009
The starting point in relation to costs under the CCT Act is section 70, which provides for the parties to pay their own costs unless “one side is able to show good reason, in terms of the interests of justice in the particular circumstances of the case, why there should be a positive exercise of the discretion in that party's favour”. Tamawood Ltd v Paans (2005) QCA 111 [18]
The mere fact that a party is legally represented will not justify an order for costs: section 71(5) CCT Act.
In deciding whether to exercise its discretion to award costs in the interests of justice, QCAT should have regard to the matters in section 71 CCT Act.(Tamawood Ltd v Paans (2005) QCA 111 per Keane JA)
(a) the outcome of the proceeding;
(b) the conduct of the parties to the proceeding before and during the proceeding;
(c) the nature and complexity of the proceeding;
(d) the relative strengths of the claims made by each of the parties to the proceeding;
(e) any contravention of an Act by a party to the proceeding;
(f) for a proceeding to which a State agency is a party, whether the other party to the proceeding was afforded natural justice by the State agency;
(g) anything else the tribunal considers relevant.
The Respondent has made various submissions relevant to the matters in section 71(4) of the CCT Act which require consideration.
Outcome of the proceedings
The Application for Review was dismissed by the CCT on 18 June 2009, as a result of a failure by the Applicant to comply with the CCT’s order to file statements of evidence. The Respondent submits that this should be viewed as a successful result for the Respondent. In light of this submission the Respondent refers first to the statements of Keane JA in Tamawood Ltd v Paans (2005) QCA 111 at [30] that the interests of justice are eroded if a successful party is required to bear the cost of representation and secondly, to the statements in Horsburg v Queensland Building Services Authority [2008] QCCTB 235 at [7] about the role of the Respondent as a regulator of the building industry and the inequities arising if such costs are bourne by the Authority.
Whilst it is clear that success in a proceeding is not of itself a ground for the award of costs, in this case the dismissal of the Applicant’s claim by the CCT for failing to provide evidence relevant to the proceeding is a factor that weighs in favour the Respondent.
Conduct of the Parties
The Respondent submits that its conduct was at all times proper and that it gave the Applicant ample opportunity to comply with its requests under the QBSA Act for payment of licensing fees and provision of financial information. The Respondent also gave the Applicant an opportunity to settle both the Applicant for Review and the Application for Costs in an effort to avoid additional legal costs.
Relevant also is the conduct of the Applicant in this matter. The Applicant after filing the Application for Review failed on two occasions to comply with orders of the CCT to file additional material. These failures contributed to the dismissal of the matter and the incurring of additional costs by the Respondent. It is also relevant that the Respondent did not contribute in anyway to the failures of the Applicant in proceeding with this matter. In my view the conduct of the Applicant weighs in favour of a costs order in favour of the Respondent.
Nature and complexity
The Application for Review was not complex. The serious nature of the outcome for the Applicant in having its licence cancelled however, may have justified engaging legal representation. No submissions were made on this point by the Respondent.
Strengths of the Claims
The Respondent submits that the Application to Review lacked merit and the strength of their position entitles them to costs. No submissions to the contrary were received by the CCT. On the facts the lack of prosecution of this matter by the Applicant may suggest a lack of merit but this of itself would not be sufficient for an award of costs.
A contravention of an Act by a party
The Respondent did not make any submissions on this point but it is relevant to note that the Application to Review was only necessary because of the Applicants failure to comply with its obligations under the QBSA Act. This is a factor in the Respondent’s favour.
Conclusions
Having regard to the outcome of the Application for Review, the failure of the Applicant to diligently purse the proceedings in accordance with the orders of the CCT and the fact the proceedings arose out a breach of the QBSA Act by the Applicant, costs in the proceedings on a standard basis should be awarded to the Respondent for the period 19 December 2008 to 4 February 2009.
Scale of costs
The Respondent submits that the District Court scale should be used for the assessment of costs. I note the view stated in Wulf v Cooper [2008] CCT BD247-06 that:
“It is imperative, in my view, if proper effect is to be given to an award by way of indemnity costs (as opposed to costs on a standard basis) that the chosen scale be an itemised scale, such as the District or Supreme Court scale, rather than a lump sum scale such as the Magistrates Court scale, under which, largely, the same sum is prescribed whether costs are to be assessed on a standard or indemnity basis.”
I agree that in this case the District Court scale is appropriate.
Orders
The Applicant will pay the Respondents costs of and incidental to the proceedings prior to 5 February 2009 on a standard basis on the District Court Scale as agreed or failing agreement, as assessed.
The Applicant will pay the Respondents reasonable costs on an indemnity basis of conducting the proceedings on and from 5 February 2009 on the District Court scale as agreed, or failing agreement, as assessed.
The Respondent’s costs will be assessed as follows:
(c)The Respondent will deliver to the Applicant an itemised claim for costs referring to the relevant items contained in the scale; and
(d)If within 14 days of that delivery, the parties have not agreed to an amount for costs, the costs shall be assessed by Hickey & Garrett, Legal Costs Assessors, Level 21, 141 Queen Street Brisbane.
The Applicant will pay the Respondent’s costs (as agreed or assessed) within fourteen (14) days of such agreement or assessment.
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