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Metricon Homes Pty Ltd v Sawyer

Metricon Homes Pty Ltd v Sawyer

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Case Copied 27 September 2013 41 min read

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IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION
JUDICIAL REVIEW AND APPEALS LIST

S CI 2013 00380

METRICON HOMES PTY LTD	Appellant
(ACN 005 108 752)
v
FREDERICK ELI SAWYER & ORS	Respondents

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JUDGE:	GARDE J
WHERE HELD:	Melbourne
DATE OF HEARING:	6 September 2013
DATE OF JUDGMENT:	27 September 2013
CASE MAY BE CITED AS:	Metricon Homes Pty Ltd v Sawyer
MEDIUM NEUTRAL CITATION:	[2013] VSC 518

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COSTS – Settlement offer – “All-in” offer – Determination of whether amount awarded plus costs was not more favourable to the other party than the offer – Production of accounts for costs and disbursements sought by offeror party – Assessment of costs by Costs Court – Whether offer effective – Use of costs consultant – Appeal from VCAT – Victorian Civil and Administrative Tribunal Act 1998 (Vic) ss 109, 111, 112 and 113 – Supreme Court Act 1986 (Vic) ss 17D and 17J - Supreme Court (General Civil Procedure) Rules 2005 (Vic) rr 26.02(4)(a) and 26.08(3) – Interpretation of Legislation Act 1984 (Vic) s 35(a) – Very slight evidence rule – Appeal allowed – Proceeding remitted to Tribunal.

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APPEARANCES:	Counsel	Solicitors
For the Appellant	Mr K Oliver	David Naidoo & Associates
For the Respondents	Ms S Kirton	Neil McPhee & Associates

HIS HONOUR:

Introduction

This appeal involves the settlement offer procedures of the Victorian Civil and Administrative Tribunal (‘the Tribunal’) under the provisions of the Victorian Civil and Administrative Tribunal Act 1998 (Vic) (‘the VCAT Act’).[1] Following an “all-in” settlement offer, a lower award plus costs was achieved. Was there an obligation on the Tribunal to determine the quantum of costs that it would have ordered at the offer date, so as to compare like with like? Was the “all-in” offer ineffectual? The settlement offer procedures of the Tribunal stand to be considered in a tribunal where prima facie no costs are awarded,[2] alternative dispute resolution is encouraged, and parties are advised to take advantage of opportunities to resolve their disputes. One consideration is that an “all-in” offer is simpler and easier to understand than a “costs-plus” offer in jurisdictions where there are many litigants in person.
[1]Victorian Civil and Administrative Tribunal Act 1998 (Vic) ss 112–115.
[2]Ibid, s 109(1).

Metricon Homes Pty Ltd (ACN 005 108 752) (‘the builder’) appeals against an order by the Tribunal that it pay the respondent owners (‘the owners’) the costs of a domestic building claim brought by the owners for defective work in relation to a dwelling house constructed by the builder at Langwarrin.[3]
[3]Sawyer v Metricon Homes Pty Ltd [2012] VCAT 1971 (Senior Member Walker) (‘Reasons’).

In February 2011, proceedings were commenced in the Tribunal by the owners claiming compensation from the builder for defective work. On 1 July 2011, the builder made an all-in offer to the owners of $80,000 in full and final settlement of the proceeding (‘the first offer’). On 22 July 2011, an offer of $90,000 “all-in” was made by…

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: [2013] VSC 518
Decision Date: 27 September 2013

CaseChat Overview and Summary

In the case of Metricon Homes Pty Ltd v Sawyer, the dispute involved a settlement offer made by Metricon Homes, which was subsequently assessed for its effectiveness in accordance with the Victorian Civil and Administrative Tribunal Act 1998. The matter was appealed to the Supreme Court, which considered whether the offer was effective and if the amount awarded, when combined with the costs, was not more favourable to the plaintiff than the offer itself. The plaintiff, Sawyer, sought production of Metricon Homes' accounts for costs and disbursements to aid in the assessment of the offer. The Supreme Court was tasked with interpreting the relevant provisions of the legislation and determining the appropriate application of the "very slight evidence rule" in this context.

The primary legal issues before the court were the interpretation of the statutory provisions governing settlement offers, particularly sections 109, 111, 112, and 113 of the Victorian Civil and Administrative Tribunal Act 1998. Additionally, the court had to determine whether the costs incurred by Metricon Homes were properly assessed and whether the use of a costs consultant was permissible under the circumstances. The court also needed to address the implications of the "very slight evidence rule" as it pertains to the assessment of costs in the context of a settlement offer.

The Supreme Court found that the Tribunal had erred in its assessment of the settlement offer and the costs associated with it. The court concluded that the Tribunal had not properly considered the statutory provisions and the evidence presented. The Supreme Court held that the Tribunal's decision should be set aside and the matter remitted to the Tribunal for re-assessment in accordance with the correct legal principles. The court found that the Tribunal had not sufficiently addressed the evidence provided by the costs consultant and had not properly applied the "very slight evidence rule." The appeal was allowed, and the matter was remitted to the Tribunal for a new determination.

The final orders of the court were that the appeal be allowed, the decision of the Tribunal be set aside, and the matter be remitted to the Tribunal for re-assessment in accordance with the correct legal principles. The court did not make any specific orders regarding costs at this stage of the proceedings.

Orders