Martin v Fasham Johnson Pty Ltd - [2007] VSC 54

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

No. 6428 of 2006

JENNIFER MARTIN	Appellant
v
FASHAM JOHNSON PTY LTD	Respondent

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JUDGE:	Bell J
WHERE HELD:	Melbourne
DATE OF HEARING:	5 March 2007
DATE OF JUDGMENT:	13 March 2007
CASE MAY BE CITED AS:	Martin v Fasham Johnson
MEDIUM NEUTRAL CITATION:	[2007] VSC 54

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COSTS – appeal – Victorian Civil and Administrative Tribunal – inadvertent mistake about value of losing party’s claim – selection of appropriate scale – relevant considerations – must be connected with case – costs orders compensatory not punitive – rules of natural justice – rules apply to issues of costs – proper approach to appeals against questions of costs – Victorian Civil and Administrative Tribunal Act 1998, ss 78(2)(c), 97, 98(1)(a), 109(1)-(3) and 111.

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APPEARANCES:	Counsel	Solicitors
For the appellant	Mr M Scarfo	Access Law
For the respondent	Mr A Laird	Schetzer Brott & Appel

HIS HONOUR:

THE ISSUES IN THE APPEAL

In a proceeding between an owner and a builder, the builder asked the Victorian Civil and Administrative Tribunal to make orders striking out the owner’s points of claim with costs, which it did.[1] The costs order required the owner to pay the builder’s costs according to the Supreme Court scale.
[1]Martin v Fasham Johnson Pty Ltd [2006] VCAT 680.

Before making these orders, the Tribunal heard submissions from the parties on all issues except the selection of the appropriate scale. The Tribunal made that selection itself.

The owner, Jennifer Martin, appealed[2] to this Court, on a question of law, against the whole decision of the Tribunal. She obtained the necessary leave only in respect of the costs order. The appeal is therefore confined to that order and these are the grounds:[3]
[2]Under s 148(1) of the Victorian Civil and Administrative Tribunal Act 1998.
[3]As specified in the notice of appeal dated 15 June 2006.

1. The Tribunal ought to have ordered costs on the scale of the County Court or the Magistrates’ Court.

2. The Tribunal erred in ordering the appellant to pay the respondent’s costs on the Supreme Court scale without first hearing submissions by the appellant as to the appropriate scale.

3. The Tribunal failed to provide any or any adequate reasons for its order.

It is convenient for me to begin with ground three.

WHY THE TRIBUNAL SPECIFIED THE SUPREME COURT SCALE

The Tribunal noted in its reasons that “general damages are claimed which seems to take this beyond County Court level.” This suggests the Supreme Court scale was selected because it thought the owner had made a claim for general – in the sense of unlimited – damages, as was perfectly possible in cases in the Domestic Building List.[4] The transcript of a later directions hearing[5] in the case confirms this to be the reason for the selection.
[4]There was no money limit on the jurisdiction of the Tribunal in cases brought under this List.
[5]Conducted on 31…

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: [2007] VSC 54
Decision Date: 13 March 2007

CaseChat Overview and Summary

Martin commenced proceedings against Fasham Johnson Pty Ltd in the Victorian Civil and Administrative Tribunal, seeking damages for alleged breaches of contract and other related claims. The Tribunal dismissed Martin's claims, and subsequently ordered him to pay costs to Fasham Johnson. Martin appealed the costs order to the Supreme Court, arguing that the Tribunal had made an inadvertent mistake regarding the value of his claims and, consequently, had applied an inappropriate scale for determining costs. The appeal raised questions about the appropriate considerations for selecting a costs scale and the proper approach to appeals concerning costs orders.

The court considered whether the Tribunal's inadvertent mistake about the value of Martin's claims warranted a different approach to the assessment of costs. The court noted that costs orders are compensatory, not punitive, and that the rules of natural justice apply to issues of costs. The court also emphasised the importance of connecting the costs order with the case and the need to consider relevant factors when selecting the appropriate costs scale. The court found that the Tribunal's error did not necessitate a different approach to the assessment of costs and that the order was within the permissible range. The appeal was dismissed, and the original costs order was upheld.

The Supreme Court reiterated that costs orders should be compensatory rather than punitive and that the rules of natural justice apply to issues of costs. The court highlighted the importance of considering relevant factors when selecting the appropriate scale for determining costs and emphasised that the costs order must be connected with the case. The court concluded that the Tribunal's costs order was within the permissible range and that the inadvertent mistake about the value of Martin's claims did not warrant a different approach to the assessment of costs.

The Supreme Court dismissed the appeal and affirmed the original costs order of the Tribunal. Martin was required to pay the costs of the appeal.

Orders