Maran Corporation v Body Corporate for Four Corners at Willow Brook Park
[2013] QCAT 219
| CITATION: | Maran Corporation v Body Corporate for Four Corners at Willow Brook Park [2013] QCAT 219 |
| PARTIES: | Andrea Clair Battistella t/as Maran Corporation (Applicant) |
| V | |
| Body Corporate for Four Corners at Willow Brook Park (Respondent) |
| APPLICATION NUMBER: | OCL066-12 |
| MATTER TYPE: | Other civil dispute matters |
| HEARING DATE: | On the papers |
| HEARD AT: | Brisbane |
| DECISION OF: | Sandra G Deane, Member |
| DELIVERED ON: | 3 May 2013 |
| DELIVERED AT: | Brisbane |
| ORDERS MADE: | 1. Maran Corporation Pty Ltd’s application is dismissed 2. Maran Corporation Pty Ltd is to pay the Body Corporate for Four Corners at Willow Brook Park’s costs of and incidental to the dismissal application on the standard basis of assessment on the District Court Scale of Costs on and from 13 October 2012. 3. If the amount of the costs is not agreed between the parties within 14 days, the costs are to be assessed by Hickey & Garrett, Legal Costs Consultants, Level 21, 141 Queen Street, Brisbane. 4. Maran Corporation Pty Ltd is to pay the costs (as agreed or assessed) within 14 days of such agreement or assessment. |
| CATCHWORDS: | Body Corporate dispute – application to dismiss proceedings – application lacks substance - application for costs – whether indemnity costs should be awarded Queensland Civil and Administrative Tribunal Act 2009 ss 3(b), 28(3)(d), 47,100, 102, 107 Body Corporate and Community Management Act 1997 ss 126(2), 270 Ralacom Pty Ltd v Body Corporate for Paradise Island Apartments (No2) [2010] QCAT 412 Malay Industries Pty Ltd v Queensland Building Services Authority [2010] QCAT 310 |
APPEARANCES and REPRESENTATION (if any):
This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act).
REASONS FOR DECISION
Maran Corporation Pty Ltd at the time this proceeding commenced was the holder of caretaking and letting agreements with the Body Corporate relating to a complex at Beenleigh. Mrs Battistella is a director and shareholder of Maran Corporation. On 29 August 2012 the Tribunal clarified that the applicant is Maran Corporation.
In May and June 2012 the Body Corporate issued remedial action notices claiming breaches of the agreements. On 16 July 2012 the Body Corporate resolved to terminate the agreements.
On 19 July 2012 this application was made to resolve a complex dispute together with an application for interim orders to prevent termination and for other orders.
Since the application was filed a receiver was appointed over Maran Corporation’s trust property under the Property Agents and Motor Dealers Act 2000[1] and Westpac Banking Corporation appointed receivers to the assets and undertaking of Maran Corporation including the Caretaking Agreement but excluding the Letting Agreement.[2]
[1] 31 July 2012.
[2] 8 August 2012.
On 29 August 2012 the application for an interim order was withdrawn and consequently dismissed apparently due to the change in circumstances as just outlined. At that time the Tribunal made directions to facilitate a decision in relation to the primary application. Costs were reserved.
There is no evidence before the Tribunal that the bank’s receiver has consented or authorised Maran Corporation to pursue this proceeding in relation to the Caretaking Agreement. It would be unnecessary as upon the appointment of the bank’s receiver the Body Corporate is prevented from terminating that agreement.[3] The Body Corporate does not dispute this. The issue in dispute therefore only relates to the Letting Agreement.
[3] Section 126(2) Body Corporate and Community Management Act 1997.
Maran Corporation failed to comply with the 29 August 2012 directions. It has not filed any submissions or statements or any additional documents. It has not sought to vacate the direction.
On 11 October 2012 the Tribunal made directions in respect of the Body Corporate’s dismissal application and claim for costs. Maran Corporation has also failed to comply with those directions. It has not filed a response.
Should Maran Corporation’s application be dismissed?
The Tribunal has power to bring a proceeding to an early end if the Tribunal considers that an application is frivolous, vexatious or misconceived or is lacking in substance or is otherwise an abuse of process. [4]
[4] Section 47 QCAT Act 2009.
The Tribunal must deal with matters in a way that is accessible, fair, just, economical, informal and quick.[5]
[5] Section 3(b) QCAT Act 2009.
The failure to comply with the directions may be related to events having overtaken Maran Corporation’s application. Understandably the Body Corporate wishes to have Maran Corporation’s application finalised.
Maran Corporation’s application is dismissed.
There is evidence before the Tribunal that:
a)the Body Corporate issued a remedial action notice in relation to breach of the Letting Agreement relating to the failure to hold a relevant licence;
b)the notice was received by Maran Corporation;
c)Maran Corporation did not hold the required licence;
d)the breach set out in the notice was not remedied prior to the Body Corporate resolving to terminate;
e)the Body Corporate passed a resolution to terminate and communicated that termination to Maran Corporation.
There is no evidence before the Tribunal which seeks to dispute any of these facts. There is no evidence before the Tribunal which suggests that there has been a defect in the process of terminating the letting agreement. These matters support the Body Corporate’s right of termination.
Maran Corporation’s application broadly viewed seeks to challenge the right of termination. The Tribunal is required to act with little formality and technicality[6] and so Maran Corporation’s application which is informally particularised is not necessarily one which should be brought to an early end. As is quite common in proceedings before the Tribunal additional information is required to assist to articulate its case. Maran Corporation was afforded this opportunity. No additional submissions or evidence have been filed.
[6] Section 28(3)(d) QCAT Act.
I find that Maran Corporation’s application seeking to challenge the Body Corporate’s right of termination is without substance and should be brought to an early end in view of the failure to provide sufficient information to the Tribunal to find that there is an arguable case to challenge the termination.
Costs
The QCAT Act provides “Other than as provided under this Act or an enabling Act, each party to a proceeding must bear the party’s own costs for the proceedings.”[7] The Body Corporate and Community Management Act 1997 (BCCM Act) provides for the award of costs in limited circumstances, which are not relevant to this proceeding.[8] The application is therefore to be decided under the QCAT Act.
[7] Section 100 QCAT Act.
[8] Section 270 BCCM Act.
The Tribunal may make an order for costs if the interests of justice require it.[9] The Tribunal may have regard to various factors.[10] These include whether a party acted in a way that unnecessarily disadvantaged another; the nature and complexity of the dispute; the relative strengths of the claims; the financial circumstances of the parties and anything else the tribunal considers relevant.
[9] Section 102(1) QCAT Act.
[10] Section 102(3) QCAT Act.
Costs may be awarded where the circumstances point compellingly that the award of costs is in the interests of justice so as to overcome the contrary starting position.[11]
[11] Ralacom Pty Ltd v Body Corporate for Paradise Island Apartments (No2) [2010] QCAT 412.
Should the Reserved costs be awarded?
I find that the circumstances in relation to reserved costs of the interim orders application do not point compellingly that the award of costs is in the interests of justice so as to overcome the contrary starting position.
The Body Corporate contends that Maran Corporation has acted in a way that unnecessarily disadvantaged it, in that it failed to withdraw the interim orders application prior to the hearing on 29 August 2012 and that by failing to withdraw it within a reasonable time of the change in circumstances[12] it caused the Body Corporate to incur costs of drawing material to defend the application and the appearance at the hearing.
[12] The appointment of the received to trust property on 31 July 2012 and the appointment of the bank’s receiver on 8 August 2012.
The Body Corporate filed 3 statements of evidence in its defence of the interim orders application. Those statements were filed on 28 August 2012.
There is no material before the Tribunal as to why the interim orders application was not withdrawn prior to 29 August 2012. The applicant was self represented and it is possible was not sufficiently aware of procedures to take such steps prior to the hearing.
There is no material before the Tribunal that the Body Corporate having received information as to the change in circumstances communicated with Maran Corporation and invited it to discontinue the application prior to the hearing on 29 August 2012.
The Body Corporate was granted leave to be legally represented on 29 August 2012. It is not apparent from the Tribunal file whether reasons were given. Granting leave is consistent with a finding that the matter was one of some complexity but equally is consistent with an efficient process for the Body Corporate to appear and make submissions in a matter. The mere fact that a party engages legal representatives and incurs legal costs is not sufficient to require the exercise of the discretion to award legal costs.
The interim orders application was withdrawn and an order recorded that it was dismissed. This is a factor in favour of an award of costs as it is some indication of the relative strengths of the claims.
There is some but limited evidence before the Tribunal of the financial circumstances of Maran Corporation. That evidence is that its financial circumstances will be adversely affected by the termination of the agreements. There is no evidence as to the financial position of the Body Corporate. This is not a factor in favour of the award of costs.
Should costs in respect of the dismissal application be awarded?
I find that the circumstances in relation to the dismissal application point compellingly that an award of costs on and from 13 October 2012 is in the interests of justice so as to overcome the contrary starting position.
By letter dated 12 October 2012 the Body Corporate confirmed that the Letting Agreement was terminated and invited Maran Corporation to withdraw the application to save costs as the Body Corporate had filed an application to dismiss Maran Corporation’s application. [13]
[13] exhibit RJH12.
Maran Corporation was therefore put on notice that the Body Corporate would be put to further expense if the application was not withdrawn. Costs up to and including 12 October 2012 had already been incurred. No explanation has been received by the Tribunal as to why it failed to withdraw its application given its apparent lack of interest in progressing the application.
The Body Corporate has been unnecessarily disadvantaged by Maran Corporation’s failure to withdraw the application once it was on notice that the Body Corporate had brought this application for dismissal and that the Body Corporate would incur the costs of progressing its application. This is a factor in favour of an award of costs in relation to the dismissal application.
An application for dismissal is somewhat complex. The Body Corporate was successful in its application. This is some evidence of the relative strength of its claims. These are factors in favour of an award of costs.
As stated earlier in these reasons the financial circumstances of the parties is not a factor in favour of the award of costs in this proceeding.
As indicated earlier in these reasons I do not find that the application was necessarily fatally flawed from the start. It is therefore not appropriate to award all the Body Corporate’s costs in defending the application.
Should indemnity costs be awarded?
I am not satisfied that it is appropriate to award indemnity costs.
The letter of 12 October 2012 effectively claimed the Body Corporate’s reserved costs of the interim order application. The Body Corporate has not been successful in its claim for those costs. I am not satisfied that there has been an imprudent refusal of an offer to settle warranting an award of indemnity costs.
Maran Corporation’s failure was to demonstrate it had an arguable claim by providing sufficient information when it was afforded the opportunity. Its failure is more in failing to progress its application rather than continuing it in wilful disregard of known facts or prolonging it by advancing groundless contentions.
Should costs be awarded against Mrs Battistella?
I am not satisfied that costs ought to be awarded against Mrs Battistella.
The applicant was self represented. The issue of the correct applicant was resolved on 29 August, 2012.
The costs awarded relate to a period after 29 August 2012.
Quantifying costs
If the Tribunal makes a costs order it must fix the costs if possible.[14] If it is not possible the Tribunal may make an order requiring costs be assessed by reference to a scale under the rules applying to a court.[15]
[14] Section 107(1) QCAT Act.
[15] Section 107(2) and (3) QCAT Act.
The Body Corporate has not provided any details of its costs allowing the Tribunal to fix the costs. It has submitted that costs should be agreed or assessed on the District Court Scale of fees.
This Tribunal has previously accepted that an itemised scale such as the District or Supreme Court scale may be preferable to a lump sum scale such as the Magistrates Court. This Tribunal has often considered the District Court Scale as appropriate.[16]
[16] Malay Industries Pty Ltd v Queensland Building Services Authority [2010] QCAT 310.
I agree that the District Court Scale is appropriate.
On this basis it is appropriate that Maran Corporation be ordered to pay the Body Corporate’s costs of and incidental to the dismissal application on the standard basis of assessment on the District Court Scale of Costs on and from 13 October 2012.
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