Northern Beaches Council v The Owners Strata Plan No 7114; The Owners Strata Plan No 7114 v Northern Beaches Council

Case •

[2023] NSWCATCD 128

•

02 November 2023

No judgment structure available for this case.

Civil and Administrative Tribunal


New South Wales

Medium Neutral Citation: Northern Beaches Council v The Owners - Strata Plan No 7114; The Owners - Strata Plan No 7114 v Northern Beaches Council [2023] NSWCATCD 128
Hearing dates: 09 October 2023
Date of orders: 02 November 2023
Decision date: 02 November 2023
Jurisdiction:Consumer and Commercial Division
Before: G Blake AM SC, Senior Member
Decision:

1.   The hearing on 16 and 17 November 2023 is vacated.

2.   Orders 5 to 16 made on 25 May 2023 are vacated.

3.   The proceedings are to be listed for further directions not before 1 March 2024.

Catchwords:

CIVIL PROCEDURE — Hearings — Adjournment — Abuse of process – No abuse of abuse established where second application for adjournment

CIVIL PROCEDURE — Hearings — Adjournment — Relevant factors — Where there are proceedings on foot in both the Tribunal and a court - Where the Tribunal is deprived of jurisdiction in respect of issues – Adjournment granted

Legislation Cited:

Civil and Administrative Tribunal Act 2013 (NSW), ss 36, 51, Sch 4, cll 5, 6

Civil Procedure Act 2005 (NSW), s 56

District Court Act 1973 (NSW), s 9

Local Government (Council Amalgamations) Proclamation 2016 (NSW)

Strata Schemes Management Act 2015 (NSW), ss 149, 253

Cases Cited:

AIN v Medical Council of New South Wales [2017] NSWCATAP 36

Brimaud v Honeysett Instant Print Pty Ltd (1988) 217 ALR 44

EB 9 & 10 Pty Ltd v The Owners SP 934 (No 2) [2018] NSWSC 546

Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management Pty Ltd (2013) 250 CLR 303; [2013] HCA 46

Donna O’Neill v T and I Engines Pty Ltd [2015] NSWCATAP 77

Gallagher v Northern NSW Local Health District [2023] NSWCATAP 245

Hanson v Metricon Homes Pty Ltd [2019] NSWCATAP 133

Nominal Defendant v Manning (2000) 50 NSWLR 139; [2000] NSWCA 80

Sethi v Cho [2023] NSWCATAP 221

Steak Plains Olive Farm Pty Ltd v Australian Executor Trustees Limited [2015] NSWSC 289; (2015) 18 BPR 35,471

Sunaust Properties Pty Ltd v The Owners - Strata Plan No 64807 [2022] NSWSC 1643

Touma v Colantuono [2021] NSWCATAP 152

Texts Cited:

None cited

Category:Procedural rulings
Parties:

SC 23/20360;
Northern Beaches Council (Applicant)
The Owners - Strata Plan No 7114 (Respondent)

SC 23/31243:
The Owners - Strata Plan No 7114 (Applicant)
Northern Beaches Council (Respondent)
Representation:

Counsel:
P Barham (Northern Beaches Council)
J Knackstredt (The Owners - Strata Plan No 7114)

Solicitors:
HWL Ebsworth Lawyers (Northern Beaches Council)
Bannermans Lawyers (The Owners - Strata Plan No 7114)
File Number(s): SC 23/20360; SC 23/31243
Publication restriction: Nil

REASONS FOR DECISION

Overview

  1. In these two proceedings Northern Beaches Council (the Council) and The Owners - Strata Plan No 7114 (OSP7114) make claims against the other under the Strata Schemes Management Act 2015 (NSW) (SSM Act) concerning a carpark.

  2. The Council has applied to vacate the hearing date and for consequential orders.

  3. I have rejected the submission of OSP7114 that the application of the Council should be dismissed because it constitutes an abuse of process.

  4. The critical factor in determining the application of the Council is whether the Tribunal has been deprived of jurisdiction in respect of issues arising in the two proceedings pursuant to cl 5(7) of Sch 4 to the Civil and Administrative Tribunals Act 2013 (NSW) (NCAT Act).

  5. As I am satisfied that the Tribunal has been deprived of jurisdiction in respect of issues arising in one of the two proceedings and the same issues arise in the other proceedings, I have decided to vacate the hearing date and make the consequential orders sought by the Council.

Introduction

  1. To explain why I have vacated the hearing date and made the consequential orders sought by the Council, I have summarised the factual background, the procedural history of, and the relief claimed and relevant allegations made in, the three proceedings between the parties, one in the District Court of New South Wales (the DCNSW proceedings) and two in the Tribunal (the NCAT proceedings), and important details of the hearing. After identifying the issues for determination, I have then dealt with the issues in turn before setting out my dispositive orders.

The factual background

  1. On 2 April 1973, the strata scheme related to strata plan no 7114 (scheme 7114), which comprises a multi-storey building including eight floors of car parking located at Manly in New South Wales, was registered.

  2. Part of the common property of scheme 7114 was subdivided and is the strata scheme related to strata plan no 13245 (scheme 13245).

  3. Since 2 April 1973, Manly Council has been the registered proprietor of 246 lots in scheme 13245 and operated a commercial public car park in respect of 217 lots.

  4. On 18 September 1996, Manly Council and OSP7114 entered into a Licence Agreement regarding the operation of the car park and related matters (the 18 September 1996 Agreement).

  5. On 22 June 1999, Manly Council and OSP7114 entered into a Deed regarding the operation of the car park and related matters (the 22 June 1999 Deed) whereby:

  1. OSP7114 granted Manly Council a ten-year licence to operate a commercial public carpark facility on specified lots of scheme 13245 and if continued thereafter on a month to month basis determinable by not less than one month’s notice in writing from either party in consideration for which the Council was required to pay to OSP7114 an annual licence fee of $2,000 per annum (subject to adjustment);

  2. Council granted OSP7114 an unrestricted right to use and occupy specified lots of scheme 13245 in consideration for which OSP7114 was required to pay Manly Council an annual licence fee of $28,500 (subject to adjustment).

  1. On 12 May 2016, the Council was formed by the amalgamation of Manly Council, Warringah Council and Pittwater Council pursuant to the Local Government (Council Amalgamations) Proclamation 2016 (NSW) and thereby had transferred to it all of the assets, rights and liabilities of Manly Council.

The DCNSW proceedings

The procedural history

  1. On 23 September 2022, the Council commenced proceedings 2022/00284794 against OSP7114 by filing a Statement of Claim (SOC).

  2. On 18 May 2023, the Council filed an Amended Statement of Claim (ASOC).

  3. On 3 July 2023, OSP7114 filed the following documents:

  1. a Defence to the Amended Statement of Claim (DTASOC);

  2. a Statement of Cross-Claim (SOCC).

  1. On 28 August 2023, Judicial Registrar Howard made a timetable for the service of evidence by the parties with the last to occur by 20 November 2023 (the 28 August 2023 DCNSW timetable).

  2. On 29 August 2023, the Council filed the following documents:

  1. Defence to Cross-Claim (DTCC);

  2. Reply to the Defence to the Amended Statement of Claim.

The relief claimed and relevant allegations made

  1. In the ASOC the Council is seeking judgment, or an order for payment by the OSP7114 to Council, in the sum of $336,069.90 (including GST) as a debt (being the total of the outstanding licence fees) with the amount payable continuing to accrue on a monthly basis.

  2. In the SOCC OSP7114:

  1. is seeking the following substantive relief:

  1. judgment in the following sums:

  1. $363,867.03 in respect of the mistaken payments;

  2. $29,652.28 in respect of the unpaid annual licence fee;

  3. $215,908.52 in respect of unpaid electricity and other charges owing;

  1. alternatively, damages;

  1. has relevantly made the following allegations:

“Unpaid electricity and other charges

20 It was a term of bylaw 17 of the Strata Plan that for so long as the Council is the owner of any of the Carpark Lots, the Council may operate a public parking station within the lots at the Council’s own cost (the Bylaw 17 Term).

21 The Bylaw 17 Term has contractual force and effect as between the OC and the Council.

Particulars

i. Section 44 of the Strata Schemes Management Act 1996 (NSW).

ii. Section 135 of the Strata Schemes Management Act 2015 (NSW).

22 It was a term of the 1996 Deed that the Council would:

a. at its own cost clean and keep clean the Carpark Lots and the Common Property;

Particulars

Clause 5(b) of the 1996 Deed.

b. pay one-half of the:

i. electricity charges for the operation of the lift between 8 pm to midnight Thursday to Friday inclusive up to a maximum of $1,000 per annum during the currency of a licence in favour of the OC over the Lots;

ii. additional costs for cleaning the ground floor arcade area of the Strata Plan up to a maximum of $1,000 per annum during the currency of a licence in favour of the OC over the Lots (together, the 1996 Deed Terms).

Particulars

Clause 5(c) of the 1996 Deed.

23 It was a term of bylaw 34 of the Strata Plan that the Council would pay one-half of the:

a. electricity charges for the operation of the lift between 8 pm to midnight Thursday to Saturday inclusive up to a maximum of $1,000 per annum;

b. additional costs for cleaning the ground floor arcade area of the Strata Plan up to a maximum of $1,000 per annum (together, the Bylaw 34 Terms).

Particulars

Clause (x) of Part 3 of bylaw 34.

24 The Bylaw 34 Terms have contractual force and effect as between the OC and the Council.

Particulars

i. Section 44 of the Strata Schemes Management Act 1996 (NSVI’).

ii. Section 135 of the Strata Schemes Management Act 2015 (NSW).

25 It was a term of the Contract that, during the period of the Lots Licence, including any month-to-month extension:

a. the Council would keep clean levels IA to 3B of the carpark including removing any graffiti;

Particulars

Clause 2.6.2 of the Contract.

b. the Council would keep clean all light covers, ramps and aisles in the Common Property;

Particulars

Clauses 2.6.4 and 2.6.5 of the Contract.

c. the Council would clean, maintain, repair and keep the Carpark Lots and the Common Property in good and substantial working order and condition (together, the Contract Terms).

Particulars

Clauses 9.1 and 23.1 of the Contract.

26 In breach of the Bylaw 17 Term, the 1996 Deed Terms, the Bylaw 34 Terms and the Contract Terms, the Council has failed or refused to:

a. clean and keep clean, or pay for the cleaning of, the Carpark Lots and the Common Property (including the fire stairs);

b. pay for the supply of electricity used by and on the Carpark Lots and/or the Common Property;

c. pay for one half of the additional electricity charges for the use of the lift between 8 pm and midnight Thursday to Saturday; and

d. pay for the additional charges for cleaning the ground floor arcade area of the Strata Plan.

…”

  1. In the DTCC, the Council has relevantly made the following allegations:

“Unpaid electricity and other charges

20 The Council admits paragraph 20 of the Cross-Claim.

21 The Council admits paragraph 21 of the Cross-Claim.

22 In answer to paragraph 22 of the Cross-Claim, the Council:

a. does not admit subparagraph (a) and in answer to this subparagraph relies on the terms of Clause 5(b) of the 1996 Deed for their true meaning and effect;

b. does not admit subparagraph (b) and in answer to this subparagraph relies on the terms of Clause 5(c) of the 1996 Deed for their true meaning and effect; and

c. says, in answer to the whole of this paragraph, that the 1996 Deed is no longer in force and effect between the Council and OC by reason of the parties’ entry into the Contract and repeats its pleading to paragraph 6.

23 The Council does not admit paragraph 23 of the Cross-Claim and in answer to this paragraph relies on the terms of by-law 34 for their true meaning and effect.

24 The Council admits paragraph 24 of the Cross-Claim.

25 In answer to paragraph 25, the Council:

a. does not admit that there was a “Lots Licence” and relies on the terms of the Contract;

b. admits the obligations within clauses 2.6.2, 2.6.4, 2,6.5, 9.1 and 23.1 of the Contract;

c. says that performance of its obligations were and are contingent upon performance by the 00 of its obligations;

d. says the OC has breached the Contract as pleaded in the Amended Statement of Claim;

e. repeats sub-paragraphs 17(c) and 17(d) above;

f. relies on the terms of the Contract for their true meaning and effect; and

g. otherwise does not admit paragraph 25 of the Cross-Claim.

26 The Council does not admit paragraph 26 of the Cross-Claim and, further, relies upon and repeats paragraph 25 above in answer to this paragraph.”

The NCAT proceedings

The procedural history

  1. On 1 May 2023, the Council commenced proceedings SC 23/20360 against OSP7114 by filing a strata and community schemes application setting out the orders it was seeking and reasons for seeking those orders (the Council’s strata application).

  2. On 25 May 2023, the Tribunal made procedural orders for the hearing of proceedings SC 23/20360 including for the filing of amended points of claim and points of defence, and orders 5 to 16 which provided for the filing of the lay and expert evidence (by 13 July 2023 and 10 August 2023 and 7 September 2023 in reply for the Council pursuant to orders 5, 7 and 9, and by 27 July 2023 and 24 August 2023 for OSP7114 pursuant to orders 6 and 8) and submissions of the parties (the 25 May 2023 orders).

  3. On 15 June 2023, the Council filed its amended points of claim (APOC).

  4. On 5 July 2023, OSP7114 filed its points of defence.

  5. On 6 July 2023, OSP7114 commenced proceedings SC 23/31243 against the Council by filing a strata and community schemes application setting out the orders it was seeking and reasons for seeking those orders (OSP7114’s strata application).

  6. On 12 July 2023, the Tribunal made procedural orders that proceedings SC 23/31243 would be listed with proceedings SC 23/20360 and that the parties were to jointly advise the Tribunal before 21 July 2023 whether the 25 May 2023 orders were sufficient for both proceedings and if not, proposed procedural directions for proceedings SC 23/31243.

  7. On 14 July 2023, the Registrar sent a notice of hearing to the parties advising that the hearing would take place on 16 and 17 November 2023.

  8. On 2 August 2023, the solicitor for the Council sent an email to the Tribunal requesting the listing of the proceedings for directions as the parties had been unable to reach agreement as to a proposed timetable.

  9. On 2 August 2023, the Tribunal made a procedural order that the parties should send their proposed timetable to the Tribunal by 9 August 2023 and it would make orders as to new timetable without the need for them to appear.

  10. On 9 August 2023, the solicitor for the Council sent an email to the Tribunal attaching its outline of submissions on the proposed orders which relevantly included an order that the NCAT proceedings be stayed pending the determination of the DCNSW proceedings (the Council’s 9 August 2023 application).

  11. On 9 August 2023, the solicitor for OSP7114 sent an email to the Tribunal attaching its letter of that date in which it relevantly sought an order that the hearing of the NCAT proceedings on 16 and 17 November 2023 be vacated.

  12. On 10 August 2023, the Tribunal made the following procedural orders (the 10 August 2023 orders) and statement of reasons (the 10 August 2023 reasons):

“1. The application to vacate the two day hearing of 16 November is dismissed.

2. The timetable made on 25 May 2023 is affirmed.

The Tribunal has received correspondence from the solicitor for the owners corporation and the solicitors for the Northern Beaches Council. Both parties ask that the hearing dates of 16 and 17 November 2023 be vacated. In the letter supporting the proposed orders the Council states that the parties could not agree to an amended timetable to retain the hearing date on 16 November 2023. In addition the solicitor now states that there are “various issues” that are currently being litigated in the District Court that relate to the interpretation of two deeds entered into by the parties.

In the circumstances the council submits that “the most appropriate way forward is to have the NCAT proceedings stayed until such a time as a decision is made in the District Court proceedings and any appeal therefrom is finalised” ... “That would avoid any risk of inconsistent findings because of the duplicated nature of the dispute”.

The NCAT Act does not provide for proceedings to be stayed or stayed indefinitely. If the applicants wish to withdraw their applications until the District Court proceedings are finalised they may do so at any time in writing.

Any further application to vacate a hearing date or to stay proceedings must be brought by an “application for miscellaneous matters” setting out why the application should be held in abeyance for an indefinite amount of time. Such application should be accompanied by appropriate pleadings from the District Court and supported by affidavits setting out why the tribunal is deprived of jurisdiction setting out precisely the duplication of causes of actions litigated in the District Court. Such application should make reference to Schedule 4 clause 7 of the NCAT Act and clarify if at the time this application was made to the Tribunal an issue arising under the application was already the subject of the dispute in the District Court proceedings in which case the Tribunal never had or was seized with jurisdiction to hear and determine the issues. Such submissions should address whether the application to vacate a hearing date and “stay” the proceedings can be decided in chambers without the need of the parties to appear.”

  1. On 5 September 2023, the Council filed the following documents:

  1. its reply in proceedings SC 23/20360;

  2. its points of defence in proceedings SC 23/31243.

  1. On 13 September 2023, the Council filed the following documents:

  1. an application for miscellaneous matters in which it seeks the following orders (the Council’s 13 September 2023 application):

“1. The hearing on 16 November 2023 be vacated.

2. The orders made on 25 May 2023 be vacated.

3. The matter to be listed for further directions not before 1 March 2024.”

  1. the affidavit of Alistair Woodward Little (Mr Little) affirmed on 11 September 2023 (the Little affidavit).

  1. On 14 September 2023, the Tribunal made the following procedural orders and statement of reasons:

“The Tribunal has received an application for miscellaneous matters. The application seeks orders to indefinitely stay proceedings pending the outcome of District Court proceedings and that the application not be relisted before March 2024.

The Tribunal sought clarification of the causes of action that are said to be duplicated between the proceedings before the District Court and the proceedings before the Tribunal. Having regard to the statement of claim filed in the District Court in May 2023, the cause of action arises in contract (a 1996 deed) and the relief sought is payment of a debt.

Prima facie there is no overlapping cause of action between the District Court proceedings and the Tribunal proceedings. However, in an affidavit of Alistair Little dated 11 September 2023 the solicitor for the council states that the central issue in all proceedings is whether the parties’ legal relationship is governed by the 1996 deed and if so whether the parties are in breach of their various obligations under that deed.

The issue to be determined is whether at the time proceedings were commenced in the Tribunal in July 2023 the proceedings effectively mirror the central issue (the terms and validity of the deed) of proceedings had already been commenced in the District Court, depriving the Tribunal of jurisdiction (see Civil and Administrative Tribunal Act 2013, schedule 4 clause 5(7)). If that is the case the Tribunal may not have jurisdiction. Alternatively, even if the Tribunal has jurisdiction, the Tribunal must determine if it is preferable to transfer all applications to the District Court (the earlier proceedings) to avoid the risk of inconsistent findings.

The matter is set down for 90 minutes to determine whether the proceedings should be transferred to the District Court because the Tribunal does not have jurisdiction to hear and determine the issues in dispute.

In the alternative, if the Tribunal does have jurisdiction, and the real issues in dispute to be determined in the Tribunal are separate and distinct from those pleaded in the District Court proceedings, to confirm the hearing date of 16 and 17 November 2023.

1. The applicant shall file and serve any submissions by 21 September 2023.

2. The respondent shall file and serve submissions in response by 28 September 2023.

3. The matter is set down for hearing for 90 Minutes to determine if the matter should be transferred to the District Court or whether the hearing date of 16 and 17 November should be maintained.”

  1. On 21 September 2023, the Council filed its submissions dated 21 September 2023 (the Council’s submissions).

  2. On 28 September 2023, OSP7114 filed the following documents:

  1. its submissions dated 27 September 2023 (OSP7114’s submissions);

  2. the affidavit of Brandon Thai (Mr Thai) affirmed on 28 September 2023 (the Thai affidavit).

  1. On 9 October 2023, OSP7114 was taken to have filed amended points of defence (APOD) and amended points of cross claim (APOCC).

The relief claimed and relevant allegations made

  1. In the Council’s strata application, the Council sought the following relief:

“1. Pursuant to s 148 (1)(b) of the SSM Act, or otherwise, by-laws 17,18, 20, 33 and 34, purportedly repealed by resolution pursuant to motion 21(2) of the Annual General Meeting of 4 April 2022, are revived.

2. Pursuant to s 150 of the SSM Act, or otherwise, the by-law purportedly made by resolution pursuant to motion 21(4) of the Annual General Meeting of 4 April 2022 (OC By-Law) is invalid.

3. Pursuant to s 148(1)(c) of the SSM Act, or otherwise, the OC By-Law is repealed.

4. Pursuant to s149 of the SSM Act, or otherwise, the by-law included at item 20 of the Annual General Meeting of 4 April 2022 (Council By-Law) is made and the Respondent is, within 28 days of orders made pursuant to these prayers for relief, to do all things necessary to register the Council By-Law.

5. Pursuant to s 126 of the SSM Act, or otherwise, the Respondent is to make repairs and maintain the lighting in the common property areas, including the common property areas in the “public car park” and including the internal building lighting over carpark lots, within 56 days of the making of orders pursuant to this prayer for relief, or such other time as the Tribunal may order.

6. Pursuant to s 131 of the SSM Act, or otherwise, the Applicant may use the areas identified at Attachment A so long as it operates a public car park on the premises for the purposes specified conditional upon a one-off payment to the Respondent of $6,700 (inclusive of GST if applicable).

7. The Respondent pay the Applicant’s legal costs.

  1. In the APOC the Council:

  1. has deleted orders 1 to 3 in the Council’s strata application, and renumbered orders 4 to 7 as orders 1 to 4;

  2. has relevantly made the following allegations:

“Background

…

(f) In or about 1996 Manly Council entered into a Deed with the Respondent granting a licence to the Respondent to use car spaces contained in lots 412 to 430 for a nominal fee (1996 Deed).

(g) In June 1999 Manly Council and the Respondent entered into another Deed (1999 Deed) which granted a licence to the Respondent to use car spaces in Lots 412 to 430 for an annual licence fee increased annually by CPI (Annual Fee). The licence extended for an initial term of 10 years expiring on 30 June 2009 and continues as a monthly licence pursuant to the holding over provisions in clause 2.5 of the 1999 Deed.

…

1. Order 1: S 149 - the by-Jaw included at item 20 of the Annual General Meeting of 4 April 2022 (Council By-Law) is made and the Respondent is to do all things necessary to register the Council By-Law.

…

1.6 Where an owners corporation unreasonably refuses to make a common property rights by-law requested by a lot owner, then the lot owner may seek an order from the Tribunal under s 149 of the SSM Act (entitled ‘Order with respect to common property rights by-laws’). The Applicant says that the Respondent’s refusal to enact a common property rights by-law is unreasonable. The High Court case of Ainsworth v Albrecht [2016] HCA 40 illustrates the practical considerations to take into account when considering the interests of all owners in the use and enjoyment of their lots and common property. The Applicant addresses each as follows:

(a) Whether there was an expectation of limited functionality of the affected property to particular uses or a particular state

The Applicant has always operated a public car park from the establishment of the strata scheme in 1973. Lot owners have been on notice of the express authority of the Applicant to operate the public carparking station as set out in registered By-law 17. The Council By-Law remains consistent with the Applicant’s continued operation of the public car park.

(b) Whether there is an impact on preservation of the original design intent or amenity of the building

The car park equipment is largely internal and to the extent visible is in keeping with the operation of a public car parking station.

(c) Whether there is any impact on noise or privacy intrusions

The car park equipment required for the operation of the public car park does not have any noise or privacy impacts.

(d) The ‘precedent effect’ - exercising caution as to opening the flood gates for other owners to make similar requests affecting the overall amenity of the building

The Council By-Law is unique to the Applicant’s operation of the public car parking station.

(e) Any ancillary benefit to the Respondent from improvements/repairs made to common property and transfer of ongoing maintenance obligation and indemnity to owner as per by-laws proposed

The car park equipment is necessary for the efficient operation of the car park that enables access to the private parking for other lot owners in the strata scheme.

(f) Whether there is any compensation owing to the Respondent for loss of enjoyment of the common property

The Applicant is prepared to offer to the Respondent the amount of $6,700.00 in consideration for the grant of the Council By-Law for the additional area of 1.6752 m2. This amount has been calculated in accordance with the valuation report by Wal Dobrow (attached) for the relevant additional area of common property.

(g) Benefit to Applicant

(i) The lots owned by the Applicant are car space lots as part of a carparking station. In using these lots, the Applicant has a reasonable expectation to be able to use the common property in connection with the operation of the car parking station.

(ii) By-law 17 authorises the Applicant to operate a public parking station with respect to the lots owned by the Applicant and this right supports the request by the Applicant for the Council By-Law. Additionally, By-law 18 confers on the Applicant “care, management and control” of certain areas of common property, being the driveways for the use of the Applicant’s car spaces. This also supports the request by the Applicant for the Council By-Law.

(iii) There is a reasonable expectation that a by-law, such as the Council By-Law, will be necessary to accommodate the upgrade of new entry and exit gates, ticket machines and payment equipment with the advance of technology.

(h) No Disadvantage to other owners

(i) The Council By-Law does not detrimentally affect the interests of other owners or the common property.

(i) The Applicant has always operated a public car park from the establishment of the strata scheme. The Council By-Law remains consistent with this and will allow for the continuing use of the common property as a public car park. In addition, the car park equipment is required for the operation of the car park. The car park equipment does not pose any disadvantage to the Respondent, as there are no impacts on the design or amenity of the building, and no noise or privacy implications. It is in the interest of the Respondent to have modern as opposed to dated, and dated looking, entry and exit equipment.

(ii) Benefits accrue to the Respondent from the Council By-Law, including the benefit of an efficiently operating car park and the benefit of repair obligations being imposed on the Applicant in the exclusive use area.

(j) The Council By-Law does not detrimentally affect the interests of other owners or the common property and is within the reasonable expectations of the Applicant. Additionally there is a benefit to the Respondent from the Council By-Law.

…

3. Order 3: S 131 - the Applicant may use the areas identified at Attachment A so long as it operates a public car park on the premises for the purposes specified, conditional upon a one-off payment to the Respondent of $6,700 (inclusive of GST if applicable).

3.1 As stated above, the Applicant has operated the car park since the establishment of the building in 1973.

3.2 Consistent with s 131(2)(a) of the SSM Act, the use is required for the reasonable operation of the public car park and, pursuant to s 131 (2)(b) of the SSM Act, the Respondent has refused to grant a licence on terms and conditions that would allow Council to continue to operate the public car park in an efficient manner.”

  1. In the APOD OSP7114 has relevantly made the following allegations:

“A. Background

…

6. In answer to paragraph (f), the Owners Corporation:

…

f. says that there is an extant dispute in the District Court (District Court proceedings) as to whether or not Council is presently in breach of clause 5 of the 1996 Deed and clause (x) of Part 3 of By-law 34, in that Council has failed or otherwise refused to:

i. clean and keep clean, or pay for the cleaning of, the Carparking Lots and the adjacent common property (including the fire stairs);

ii. pay for the supply of electricity used by and on the Carparking Lots and/or the adjacent common property;

iii. pay for one half of the additional electricity charges for the use of the lift between 8 pm and midnight Thursday to Saturday; and

iv. pay for the additional charges for cleaning the ground floor arcade area of Strata Plan 7114.

…

7. In answer to paragraph (g), the Owners Corporation:

…

f. says there is a dispute in the District Court proceedings as to whether or not the Council is presently in breach of clause 2.7 and 3 of the 1999 Deed, in that it has failed to pay the annual fee for the 1999 Common Property Licence from and including 2016; and

…

B. Order 1:5149 application for the making of a by-law

…

6. In answer to paragraph 1.6, the Owners Corporation:

a. repeats paragraphs A3 to A12 of the Background section above and paragraphs B4 B5 of this section;

b. says that the proposed common property rights by-law is:

…

iii. being sought in circumstances where, as alleged in the District Court proceedings, the Council is in extant breach of its own obligations under the existing contractual framework;

…

D. Order 3: S 131 application

1. In answer to this aspect of the application, the Owners Corporation:

a. repeats its answers in Sections A (Background) and B (Order 1) above;

…”

  1. In the APOCC OSP7114:

  1. is relevantly seeking the following relief:

“1. Pursuant to s 149(1)(b) of the Strata Schemes Management Act 2015 (NSW) (SSMA), an Order repealing By-law 34 (By-law 34) of Strata Plan 7114 (the Strata Plan).

2. Pursuant to s 232 of the SSMA, clause (xii) of Part 3 of By-law 34 and! or clause 9.4 of the deed entered into by the Respondent (the Council) and the Applicant (the Owners Corporation) on or about 22 June 1999 (the 1999 Deed), an Order requiring the Council to:

a. remove all car parking infrastructure from the common property of the Strata Plan; and

b. restore the common property to the state and condition it was in before the car parking infrastructure was installed.

3. In the alternative to prayers 1 and 2, pursuant to s 149(1)(c) of the SSMA, an Order prescribing a change to By-law 34, requiring the Council to pay to the Owners Corporation a fair and reasonable licence fee, to be determined by the Tribunal, for the rights granted by and in respect of By-law 34 to the Council to install and maintain car parking infrastructure on the common property of the Strata Plan.

…”

  1. has relevantly made the following allegations:

“B. Order 1: S 149 application for the repeal of By-law 34

1. By-laws 17 and 18 of the Strata Plan are adequate for Council to be able to operate a public carpark in the Car Parking Lots.

2. Council is unable to operate a commercial for-profit car park in the Car Parking Lots in the absence of a right to use, alter and maintain fixtures upon common property of the Strata Plan.

3. The rights which the Council presently enjoys to use, alter and maintain fixtures upon the common property of the Strata Plan:

a. are variously conferred by:

i. the 1996 Deed and By-law 34, which may be terminated by the Owners Corporation as a result of the Council’s extant breach alleged in the District Court proceedings; and

ii. the 1999 Deed, which may be terminated by the Owners Corporation at will;

b. are being enjoyed by the Council:

i. at a nominal cost, to the disbenefit of the Owners Corporation as a whole; and

ii. in circumstances where, as alleged in the District Court proceedings, the Council is in extant breach of its payment obligations under the 1996 Deed, By-law 34 and the 1999 Deed.

4. Lot owners in the Strata Plan other than the Council, and the Owners Corporation as a whole, are disadvantaged by the continued operation of By-law 34:

a. in the circumstances set forth in paragraph B3 above; and

b. further, in circumstances where, as a result of the operation of the commercial car park:

i. members of the public are permitted to come on to the common property of the Strata Plan and cause mess and damage;

ii. the common property of the Strata Plan is subject to greater wear and tear than would otherwise be the case;

iii. the presence of members of the public on the common property of the Strata Plan detracts from other lot owners’ reasonable expectations of privacy; and

iv. the common property of the Strata Plan around and adjacent to the Car Parking Lots is being utilised by just one lot owner (the Council) for its own exclusive and substantial financial benefit, without that benefit being meaningfully shared with the Owners Corporation as a whole.

5. In light of the history of the Strata Plan as alleged herein, the Council:

a. only has a reasonable expectation of being able to use the common property of the Strata Plan to operate a public car park without any car parking infrastructure; and

b. has no reasonable expectation of being able to use, alter and maintain fixtures on the common property of the Strata Plan to generate a profit without adequately compensating the Owners Corporation.

6. In the premises, the Tribunal ought to make an Order pursuant to s 149(1)(b) of the SSMA, repealing By-law 34.

C. Order 2: S 232 application for make-good works

Pursuant to clause (x) of Part 3 of By-law 34, at the expiry of the term of By-law 34 (which would occur upon its repeal in accordance with Order 1), the Council is obligated to remove its car parking infrastructure and make good the common property of the Strata Plan. A similar obligation is imposed by clause 9.4 of the 1999 Deed.

2. Accordingly, and in any event, if the Tribunal makes Order 1, it is proper and just that the Council ought to be required to carry out its removal and make good obligations.

D. Order 3: S 149 application for the amendment of By-law 34

3. Alternatively to Orders 1 and 2, for the same reasons as those set forth in Section B above, the Tribunal ought to make an Order pursuant to s 149(1)(c) of the SSMA, changing By-law 34 so as to require the Council to pay to the Owners Corporation a fair and reasonable licence fee, to be determined by the Tribunal, for the rights granted by and in respect of By-law 34 to the Council to install and maintain car parking infrastructure on the common property of the Strata Plan.”

The hearing of the Council’s 13 September 2023 application

  1. On 9 October 2023, the Council’s 13 September 2023 application was heard.

  2. The Council relied on the following documents which were admitted into evidence without objection as to the document in (1) below and subject to relevance as to the documents in (2) and (3) below:

  1. the Little affidavit which was marked as exhibit A1;

  2. the 18 September 1996 Agreement which was marked as exhibit A2;

  3. the 22 June 1999 Deed which was marked as exhibit A3.

  1. OSP7114 relied on the Thai affidavit which was admitted into evidence without objection and marked as exhibit R1.

  2. At the commencement of the hearing, I granted leave to OSP7114 to file the APOD and the APOCC which were taken to be filed instanter.

  3. There was no oral evidence.

  4. Each of the Council and OSP7114 relied on their written submissions. Council for the Council and OSP7114 each made oral submissions.

  5. At the conclusion of the hearing, I reserved my decision and made procedural orders for the provision of submissions on the question of whether the Council’s 13 September 2023 application should be dismissed on the basis that it is in substance a repetition of the Council’s 9 August 2023 application and there has been no material change in circumstances.

  6. On 16 October 2023, the Council filed its supplementary submissions of that date (the Council’s supplementary submissions).

  7. On 19 October 2023, OSP7114 filed its supplementary submissions dated 18 October 2023 (OSP7114’s supplementary submissions).

The issues for determination

  1. The following issues arise for determination:

  1. issue 1: whether the Council’s 13 September 2023 application should be dismissed on the ground that it is an abuse of process;

  2. issue 2: whether the relief sought in the Council’s 13 September 2023 adjournment application should be granted.

Issue 1: whether the Council’s 13 September 2023 application should be dismissed on the ground that it is an abuse of process

  1. Counsel for OSP7114 raised this issue in his oral submissions and referred to Brimaud v HoneysettInstant Print Pty Ltd (1988) 217 ALR 44 (Brimeaud) at 46. This issue has been dealt by the parties with in their supplementary written submissions. I have summarised these supplementary written submissions before considering this issue.

The Council’s supplementary submissions

  1. In the Council’s supplementary submissions, the Council made the following submissions:

  1. in summary, the Council’s 13 September 2023 application is not an abuse of process. No claim of prejudice has been advanced. The Council’s 13 September 2023 application is not in substance a repetition of the Council’s 9 August 2023 application. There is no general rule that there must be a material change of circumstances. In any event, there has been a material change of circumstances in a number of respects;

  2. Brimaud must now be seen in light of s 36 of the NCAT Act;

  3. while the principles in Brimaud have been followed in the Tribunal (see AIN v Medical Council of New South Wales [2017] NSWCATAP 36 (AIN)), there is no general rule about second interlocutory applications as explained in Nominal Defendant v Manning (2000) 50 NSWLR 139; [2000] NSWCA 80 (Manning) at [45], [71];

  4. the 10 August 2023 orders were orders of a purely procedural nature;

  5. the Council’s 13 September 2023 application was necessarily dealt with in the absence of evidence. It cannot be said that the Council engaged in a “self-created risk”;

  6. the ability to put on detailed written submissions and evidence and to engage in a live hearing constituted a material change of circumstances;

  7. the two orders sought in the Council’s 9 August 2023 application and the Council’s 13 September 2023 application are vastly different in operation;

  8. it is clear from the 10 August 2023 reasons that the Tribunal did not intend to make a final ruling or to prevent a second application being brought in the outlined circumstances;

  9. the following matters constituted a material change of circumstances:

  1. the filing of the evidence by the Council;

  2. the filing of the evidence by OSP7114;

  3. the filing of extensive submissions by both parties;

  4. the need to have a timetable made for proceedings SC 23/31243;

  5. the 28 August 2023 DCNSW timetable;

  6. OSP7114’s amended pleadings filed on 9 October 2023.

OSP7114’s supplementary submissions

  1. In OSP7114’s supplementary submissions, OSP7114 made the following submissions:

  1. the principles in Brimaud have been cited in many subsequent cases, including in the Tribunal, in a variety of procedural contexts. They can apply to any form of interlocutory application that is of a substantive nature. As here, a stay is substantive in nature, as it will materially affect the ability of the parties to have their dispute determined promptly as recognised in Manning at [13], [45];

  2. section 36 of the NCAT Act is a broad statement of purpose which does not circumscribe the operation of the Brimaud principles, which continue to have application in the Tribunal and elsewhere. To the extent s 36 is relevant at all, the ‘guiding principle’ requires proceedings to be disposed of promptly - the very antithesis of the Council’s 13 September 2023 application;

  3. The ‘circumstances’ that require a material change are the actual facts which could have a material bearing upon the outcome of an interlocutory application as explained in Brimeaud at 46. Nothing that has been pointed to by the Council fits that description.

Consideration

  1. The factual context in which Brimeaud was decided is set out in the headnote:

“The plaintiff filed a summons claiming an order that the defendant company be wound up. A notice of motion was brought by the plaintiff for the appointment of the provisional liquidator of the defendant company and a notice of motion by the defendant for various procedural orders including an order for pleadings.

Pursuant to leave the summons was amended by adding three directors of the defendant company as defendants. That same day there was also a contested hearing of the application for appointment of a provisional liquidator, and an order was made appointing a provisional liquidator. There had been no evidence at all from the defendants except of the most formal kind and there had been no application for an adjournment of the motion for appointment of a provisional liquidator.

The defendants filed a notice of motion for an order that the order appointing the provisional liquidator be set aside, to which was added by amendment, an order pursuant to s 373 of the Companies (NSW) Code that the provisional liquidator be removed.”

  1. In Brimaud at 46-47 McLelland J articulated the following principles:

Interlocutory orders, of their very nature, create no res judicata or estoppel, and the court retains jurisdiction to set aside, vary or discharge an interlocutory order up to the time of the final disposition of the proceedings. However the general rationale of the principles last referred to applies even in the case of interlocutory orders. It would be conducive to great injustice and enormous waste of judicial time and resources if there were no limit on the power of a party to have any interlocutory application or order relitigated at will.

The overriding principle governing the approach of the court to interlocutory applications is that the court should do whatever the interests of justice require in the particular circumstances of the case. In giving effect to that general principle, and in recognition of the public and private interests earlier referred to, rules of practice have been developed in accordance with which the discretionary power of the court to set aside, vary or discharge interlocutory orders will ordinarily be exercised. Not all kinds of interlocutory orders attract the same considerations. For present purposes one may put to one side orders of a merely procedural nature … and injunctions (or undertakings) made or given by agreement and without contest “until further order” …

In the present case I am dealing with an interlocutory order of a substantive nature made after a contested hearing in contemplation that it would operate until the final disposition of the proceedings. In such a case the ordinary rule of practice is that an application to set aside, vary or discharge the order must be founded on a material change of circumstances since the original application was heard, or the discovery of new material which could not reasonably have been put before the court on the hearing of the original application: …” (citations omitted)

  1. In Manning, the factual context of the appeal is set out in the headnote:

“The respondent sued the Nominal Defendant for damages arising from a motor vehicle accident in 1989. The respondent had to commence proceedings under the Motor Accidents Act (“the Act”) by 30 June 1990, but did not commence proceedings against the Nominal Defendant until 1996. George ADCJ refused leave to commence the action out of time. There was no appeal against the dismissal of the action. The respondent made another application which came before Williams DCJ. It was supported by additional evidence not produced at the first application. His Honour granted leave to the respondent to commence proceedings against the Nominal Defendant pursuant to s52(4) of the Act. He was satisfied that a full and satisfactory explanation had been given for the delay, and considered that it was fair and just that the leave sought by the respondent be granted. He found that the Nominal Defendant had suffered no prejudice in relation to the issue of liability. His Honour granted leave but excluding certain claims in respect of injuries and disabilities.”

  1. In Manning, the New South Wales Court of Appeal (Heydon JA and Foster AJA with Mason P dissenting) dismissed the appeal. At [45], Heydon JA said in relation to Brimaud:

“[45] … These “general rules” and “ordinary rules of practice” are to be administered bearing in mind the “over-riding principle governing the approach of the Court to the interlocutory applications”, namely “that the Court should do whatever the interests of justice require in the particular circumstances of the case” … “ (citation omitted).

  1. Foster AJA after referring at [97] to Brimaud at 46-47, at [99] noted the submission of counsel for the Nominal Defendant a second interlocutory application seeking the same orders could not be entertained unless it was based on changed circumstances or evidence which could not previously have been adduced with due diligence. In so doing he also referred to the undoubted public interest in forensic efficiency and the early finalisation of litigation. His Honour at [101] explained why he was not persuaded by this submission:

“[101] As will appear, I am not persuaded that counsel’s submission, in this regard, is correct. The circumstances that the previous application had failed for want of evidence explaining the delay and that the second application was brought, in effect, to remedy that deficiency by the adduction of evidence which should have been presented in the first application was a matter to be considered in determining how the discretion should be exercised in the second application. I am not prepared, however, to hold that the applicant was precluded, as a matter of principle, from bringing the evidence forward in the second application or that its reception and acceptance inevitably resulted in the miscarriage of discretion.”

  1. The principles in Brimaud at 46-47 have been recently referred to and applied in the Tribunal: AIN at [23], [25]; Sethi v Cho [2023] NSWCATAP 221 at [25]; Gallagher v Northern NSW Local Health District [2023] NSWCATAP 245 at [62].

  2. It is unnecessary to determine whether the Council’s 13 September 2023 application is in substance the same as the Council’s 9 August 2023 application, and if it is whether there has been material change of circumstances since 10 August 2023. This is because the Tribunal in the 10 August 2023 reasons contemplated a further adjournment application by the Council in the form of an application for miscellaneous matters accompanied by evidence including the pleading in the DCNSW proceedings. In these circumstances, I am satisfied that the interests of justice, and it can be added the guiding principle in s 36(1) as given effect to pursuant to s 36(2) of the NCAT Act, require that the Council’s 13 September 2023 application be determined on its merits.

  3. For these reasons, I have not accepted OSP7114’s contention that the Council’s 13 September 2023 application should be dismissed on the ground that it is an abuse of process.

Issue 2: whether the relief sought in the Council’s 13 September 2023 adjournment application should be granted

  1. Before considering this issue, I have summarised the evidence of the parties to the extent that it is not recorded in the factual background, and their written submissions. It is unnecessary to summarise oral submissions as they, in substance, reinforced their written submissions.

The Little affidavit

  1. In the Little affidavit (at [18]), Mr Little gave evidence that on 20 July 2023 he caused his letter of that date to be sent to Mr Thai proposing a timetable in the NCAT proceedings involving the identification of the issues in dispute through points of claim, defence and reply, and then their stay pending determination of the DCNSW proceedings (the 20 July 2023 Little letter).

The Thai affidavit

  1. In the Thai affidavit Mr Thai gave the following evidence:

  1. the Council served the SOC on 22 March 2023 (at 5]);

  2. OSP7114 has been unable to comply with order 6 of the 25 May 2023 orders because the Council is in breach of order 5 (at 8]);

  3. he sent an email to Nicole Tutton (Ms Tutton) of the council’s lawyers on 26 July 2023 contending that there was no true overlap between the DCNSW proceedings and the NCAT Proceedings and proposing a timetable in the NCAT proceedings involving the identification of the issues in dispute through points of claim, defence and reply, and an extension of time for compliance with the 25 May 2023 orders in which it was implicit that the hearing on 16 and 17 November 2023 would be vacated (at 13]);

  4. Ms Tutton sent an email to him on 28 July 2023 in substance repeating the contents of the 20 July 2023 Little letter (at 14]).

The Council’s submissions

  1. In the Council’s submissions, the Council made the following submissions:

  1. in summary, OSP7114’s strata application agitates various issues that are currently being litigated in the DCNSW proceedings, primarily in relation to the issue of the validity and operation of the 18 September 1996 Agreement and the 22 June 1999 Deed;

  2. a temporary adjournment of the NCAT Proceedings would best facilitate the overriding purpose in s 56 of the Civil Procedure Act 2005 (NSW) (CP Act) and s 36 of the NCAT Act in that it would avoid potentially inconsistent or contradictory findings across the two jurisdictions; prevent the parties from being put to unnecessary expense with respect to the preparation of evidence; reduce the likelihood of any appeal in both matters; and better allow for the just, quick and cheap resolution of the real issues in dispute;

  3. the District Court is not only the appropriate forum in which to litigate the OSP7114’s claim for relief in the SOCC, it is now the only forum to determine this debt claim, as the Tribunal would appear, currently, to lack jurisdiction for at least two reasons:

  1. firstly, it is because the Tribunal has no express head of power to make awards of damages in contract claims or to order payments of debts due under contracts, or to apply the CP Act as sought in the DTASOC at [24], even on a broad view of implied or incidental powers. The subject of implied or incidental powers of the Tribunal has been fertile ground for appeal and is to be avoided if possible. Even if the Tribunal did have such implied or incidental powers, its jurisdiction in respect of the interpretation of the 22 June 1999 Deed has been ousted by virtue of the prior institution of the DCNSW proceedings;

  2. secondly, the Council commenced the DCNSW proceedings in 2022, and, if necessary to argue, the ASOC was filed before OSP7114’s strata application was filed and the pleadings in the DCNSW proceedings raising the 18 September 1996 Agreement were all filed prior to the filing of OSP7114’s strata application. In those circumstances, having regard to Sunaust Properties Pty Ltd v The Owners - Strata Plan No 64807 [2022] NSWSC 1643 (Sunaust Properties) at [9] and [15], by the operation of cl 5(7) of Sch 4 to the NCAT Act, on the Tribunal becoming aware of the DCNSW proceedings it ceases to have jurisdiction to hear the OSP7114’s strata application;

  1. as to the Council’s strata application, at the time of the commencement of proceedings SC 23/20360 on 27 May 2023 (which is presumably a mistaken reference to 1 May 2023), the issue with respect to the status of the 18 September 1996 Agreement and the 22 June 1999 Deed was not, on the pleadings, the subject of dispute in either the DCNSW proceedings or proceedings SC 23/20360. It follows that the Tribunal could not have been deprived of jurisdiction to deal with the matters raised in the Council’s strata application by reason of cl 5(7) of Sch 4 to the NCAT Act;

  2. the issues associated with the concurrent jurisdiction of the Tribunal and the District Court did not arise until the filing of the SOCC, and OSP7114’s strata application on 3 July 2023 and 6 July 2023 respectively. The key points of duplication arise because both the SOCC and the APOCC allege that the parties’ legal relationship is still partly governed by, and that Council is in breach of purported obligations said to arise under, the 18 September 1996 Agreement. However, the Tribunal does not have jurisdiction to determine these claims. Even if it did, these claims should be determined in the District Court because the DCNSW proceedings were commenced first in time;

  3. the NCAT Proceedings cannot be transferred to the District Court pursuant to cl 6 of Sch 4 of the NCAT Act and consolidated with the DCNSW proceedings due to the District Court’s lack of jurisdiction to hear the matter either under s 9 of the District Court Act 1973 (NSW) (DC Act) or the SSM Act;

  4. alternatively, in the light of s 253 of the SSM Act and having regard to EB 9 & 10 Pty Ltd v The Owners SP 934 (No 2) [2018] NSWSC 546 at [37], proceedings regarding strata matters should be dealt with, absent special reasons, by the Tribunal at first instance rather than being referred to the Supreme Court,

  5. the transfer of the DCNSW proceedings from the District Court to the DCNSW proceedings would also be untenable as the claims involved do not satisfy the requirement of cl 6(2) of Sch 4 to the NCAT Act and the Tribunal is unlikely to have the jurisdiction to grant the relief sought by OSP7114 in the SOCC;

  6. a finite adjournment of the NCAT proceedings (pursuant to s 51 of the NCAT Act) would be the appropriate remedy, rather than any prospective transfer of the NCAT proceedings under cl 6 of Sch 4 to the NCAT Act;

  7. having regard to the 28 August 2023 DCNSW timetable, an adjournment of the NCAT proceedings for six months would be adequate to enable the DCNSW proceedings to be heard and for the District Court to hand down its decision, which the Council anticipates will include a determination about the interpretation of the 18 September 1996 Agreement and the 22 June 1999 Deed and the connected issues agitated across the various proceedings. Should the DCNSW proceedings be finalised prior to that time, the parties could request that the Tribunal re-list the matter for further directions;

  8. such a stay or adjournment has previously been granted in proceedings in the Tribunal out of a similar concern with respect to estoppels arising due to concurrent proceedings: Steak Plains Olive Farm Pty Ltd v Australian Executor Trustees Limited [2015] NSWSC 289; (2015) 18 BPR 35,471 (Steak Plains Olive Farm) at [111];

  9. as the decision by the District Court will bind the parties on the issues which are determined by that Court (and which are intrinsic to its determination), an approach which allows for the conclusion of the DCNSW proceedings before the continuation of the NCAT Proceedings would limit the risk of inconsistent findings, limit the risk of appeals, and the NCAT Proceedings can instead be focused entirely on the issues arising under and in relation to the SSM Act.

OSP7114’s submissions

  1. In OSP7114’s submissions, OSP7114 made the following submissions:

  1. the DCNSW proceedings are backwards looking: they require the District Court to determine whether or not the Council, and/or OSP7114, have breached historical obligations arising under existing agreements and bylaws. By contrast, the NCAT proceedings are forward looking: they require the Tribunal to determine what legal framework, by way of by-law, ought to govern the parties’ relationship in the future;

  2. it is not clear why the Tribunal is said by the Council to be required to determine, as a factual matter in the NCAT proceedings, the existence (or otherwise) of historical breaches by the Council of its contractual obligations. Those matters do not require determination in order for the Tribunal to be able to decide upon a legal framework to govern the parties’ future relationship;

  3. there is no true overlap between the two sets of proceedings. To put the issue beyond further argument, OSP7114 have filed the APOD and the APOCC which make clear that, to the extent that historical breaches by the Council are relevant in the NCAT proceedings, no finding of breach is required by the Tribunal; rather, it is necessary only, at this point, to make a finding as to the existence of a dispute in the DCNSW proceedings about those matters;

  4. the Tribunal has jurisdiction, and is properly seized of, the issues that are in the dispute in the NCAT proceedings. Similarly, the District Court has jurisdiction, and it properly seized of, the issues that are in dispute in the DCNSW proceedings. The provisions dealing with deprivation of jurisdiction under cl 5 of Sch 4 to the NCAT Act therefore have no application. It also follows that a transfer of these proceedings to the District Court pursuant to cl 6 of Sch 4 to the NCAT Act would not be appropriate. This context is important in determining whether or not there is any proper basis for the Council’s 13 September 2023 application;

  5. having regard to s 36 of the NCAT Act and the principles in Armee v Brealey [2017] NSWCATAP 141 (Armee) at [121], the Council’s 13 September 2023 application should be dismissed. There is no prejudice to the Council in requiring it to prosecute both the DCNSW proceedings and the NCAT proceedings at the same time: the Council decided to commence both proceedings; and OSP7114 are similarly required to defend both proceedings at the same time;

  6. it may be anticipated that, if the Council’s 13 September 2023 application is granted, a further application will be brought for a further stay in the event the DCNSW proceedings – including any appeal - have not yet been resolved by that time. In reality, it could be years before the NCAT proceedings are revived for consideration;

  7. the Council should be directed to put on its evidence in support of the Council’s strata application forthwith, noting that it was originally directed to do so by 13 July 2023.

Consideration

  1. Part 4 Division 4 (ss 49-55) of the NCAT Act contains provisions dealing with the conduct of proceedings in the Tribunal. Section 51 deals with the adjournment of proceedings, and provides:

51 Adjournment of proceedings

The Tribunal may adjourn proceedings to any time and place (including for the purpose of enabling the parties to negotiate a settlement).

  1. Schedule 4 contains provisions dealing with proceedings in the Consumer and Commercial Division of the Tribunal. Clause 5 deals with the relationship between the Tribunal and courts and other bodies in connection with Division functions, and relevantly provides:

5 Relationship between Tribunal and courts and other bodies in connection with Division functions

…

(3) Effect of application to Tribunal or court If, at the time when an application was made to the Tribunal for the exercise of a Division function, no issue arising under the application was the subject of a dispute in proceedings pending before a court, a court has no jurisdiction to hear or determine such an issue.

…

(6) For the purposes of subclause (3), an issue arises under an application made to the Tribunal for the exercise of a Division function only if the existence of the issue is shown in the applicant’s claim or is recorded in the record made by the Tribunal in accordance with this Act.

(7) Effect of pending court proceedings on Tribunal If, at the time when an application is made to the Tribunal for the exercise of a Division function, an issue arising under the application was the subject of a dispute in proceedings pending before a court, the Tribunal, on becoming aware of those proceedings, ceases to have jurisdiction to hear or determine the issue.

(8) Subclause (7) ceases to apply to the extent to which the proceedings concerned are dismissed or quashed by the court, or by another court, for want of jurisdiction or without deciding the issue on its merits, or withdrawn.

…

  1. Clause 6 deals with the Transfer of proceedings to courts or to other tribunals, and provides:

6 Transfer of proceedings to courts or to other tribunals

(1) If the parties in any proceedings for the exercise of a Division function so agree, or if the Tribunal of its own motion or on the application of a party so directs, the proceedings are—

(a) to be transferred to a court (in accordance with the rules of that court) that has jurisdiction in the matter, and

(b) to continue before that court as if the proceedings had been instituted there.

(2) If the parties in any proceedings that have been instituted in a court so agree, or if the court of its own motion or on the application of a party so directs, the proceedings are, if the proceedings relate to a matter for which the Tribunal has jurisdiction to exercise a Division function—

(a) to be transferred to the Tribunal in accordance with the procedural rules (if any), and

(b) to continue before the Tribunal as if the proceedings had been instituted in the Tribunal.

  1. In Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management Pty Ltd (2013) 250 CLR 303; [2013] HCA 46 (ERAG) the High Court (French CJ, Kiefel, Bell, Gageler and Keane JJ) at [51] made the following observations:

“[51] In Aon Risk Services Australia Ltd v Australian National University , it was pointed out that case management is an accepted aspect of the system of civil justice administered by the courts in Australia. It had been recognised some time ago by courts in the common law world that a different approach was required to tackle the problems of delay and cost in the litigation process. Speed and efficiency, in the sense of minimum delay and expense, are essential to a just resolution of proceedings. The achievement of a just but timely and cost-effective resolution of a dispute has effects not only upon the parties to the dispute but upon the court and other litigants. The decision in Aon Risk Services Australia Ltd v Australian National University was concerned with the Court Procedures Rules 2006 (ACT) as they applied to amendments to pleadings. However, the decision confirmed as correct an approach to interlocutory proceedings which has regard to the wider objects of the administration of justice.” (citation omitted)

  1. In DonnaO’Neill v T and I Engines Pty Ltd [2015] NSWCATAP 77 (O’Neill), the Appeal Panel, after having at [20] set out ERAG at [51], adopted at [21]-[23] the following principles with respect to an application for an adjournment:

“[21] That approach is applicable in this Tribunal. Section 36(1) of the Civil and Administrative Tribunal Act 2013 (‘the Act’) is in relevantly identical terms to s 56(1) of the Civil Procedure Act 2005, the provision considered in the Expense Reduction decision.

[22] It follows that a number of principles apply to applications for an adjournment:

(1) matters should almost always proceed on the date fixed for hearing, for the reasons enunciated above,

(2) an application for an adjournment should be seen as the exceptional rather than the ordinary course;

(3) where the adjournment is caused, at least in part, by the delay of the party seeking the adjournment, or non compliance by that party with an extant order of the Tribunal, adequate explanation is called for, and its absence weighs heavily, and sometimes decisively against the grant of an adjournment

[23] Further, there is the effect on the opposing party to consider. In Sayhoun v Owners Corporation Strata Plan 75123 [2014] NSWCATAP 112, an Appeal panel of this Tribunal said at [17], in terms we would adopt:

“We are satisfied that the respondent would be prejudiced if an extension of time were granted. That prejudice may be addressed by an award of costs, although we note the remarks of the plurality in Aon Risk Services Aust Pty Ltd v Australian National University [2009] HCA 27; (2009) 239 CLR 175 at [100] that justice cannot always be measured in money and that a judge is entitled to weigh in the balance the strain the litigation imposes upon litigants; and their approval (also at [100]) of Bowen LJ’s statement in Cropper v Smith [1884] 26 Ch D 700 that: Non-compensable inconvenience and stress on individuals are significant elements of modern litigation. Costs recoverable even on an indemnity basis will not compensate for time lost and duplication incurred where litigation is delayed or corrective orders necessary.”“

  1. The principles in O’Neill at [20]-[23] have been followed by the Appeal Panel in several subsequent decisions: see, for example, Armee at [121], [125]; Hanson v Metricon Homes Pty Ltd [2019] NSWCATAP 133 at [25], [28]; Touma v Colantuono [2021] NSWCATAP 152 at [58]-[59].

  2. In Steak Plains Olive Farm, the New South Wales Supreme Court relevantly stayed proceedings in the Supreme Court pending the determination of proceedings in the Tribunal. White J at [95]-[101] considered, but found it unnecessary to determine, the scope and effect cl 5(6) of Sch 4 to the NCAT Act. His Honour at [111] gave the following reasons for staying the proceedings in the Supreme Court:

“[111] The hearing in the Tribunal might well result in the determination of issues relevant to SPOF’s claim for damages. If those issues are essential to whatever orders the Tribunal makes then issue estoppels may well arise. The damages claim should not proceed in this Court whilst the proceedings in the Tribunal continue. There should be a stay of that claim until the final determination of the proceedings in the Tribunal or further order.”

  1. In Sunaust Properties, the New South Wales Supreme Court dismissed an application by the defendant to transfer the proceedings to the Tribunal under cl 6(2) of Sch 4 to the NCAT Act which was opposed by the plaintiff. Rees J, after having referred to cl 5(3) to (6) and then cl 5(7) and (8) of Sch 4, said (at [9]):

“[9] That is, consistently with sub-clauses 5(3) to (6), where a court is where “an issue arising under the application” is first agitated, then that court is the forum where the “issue” will be determined. In either scenario, identification of the “issues” is not to be approached narrowly but by focusing on the substance of the real legal and factual issues and with the statutory purpose in mind, being to avoid concurrent proceedings and a risk of inconsistent findings: Steak Plains Olive Farm at [104]-[105]; The Owners Corporation – Strata Plan 64807 v BCS Strata Management Pty Ltd [2020] NSWSC 1040 at [45] (per Williams J).”

  1. In Sunaust Properties at [15]-[23], Rees J explained the relationship between cll 5 and 6 of Sch 4 to the NCAT Act:

“[15] Clause 5 of Schedule 4 to the NCAT Act governs which forum has jurisdiction to determine a matter. Clause 6 governs the procedure for transferring the case from one forum to the other. The clauses should be read and construed so as to work together in a coherent manner and, where possible, to give effective operation to both.

[16] The application of clause 6 is straightforward where there is only one proceeding on foot, being in either the Tribunal or a court, and the transfer is made from one forum to the other. In that situation, it will obviously be critical to ensure that the forum to which the proceedings are being transferred has jurisdiction to deal with the matter.

[17] The application of clause 6 becomes more complicated where there are proceedings on foot in both the Tribunal and a court and, by operation of clause 5, the forum in which proceedings were first commenced has jurisdiction in respect of “issues” while the other forum does not. Such a situation is not uncommon. Parties endeavour to have their disputes resolved in their preferred forum by promptly filing an application or commencing proceedings in that forum. Not infrequently, the other party to the dispute may have commenced an action in a different forum at about the same time. After sorting out which forum has jurisdiction and in respect of what “issues”, the later applications or proceedings may nonetheless continue to deal with residual issues. In some cases, this difficulty has been addressed by staying one proceeding while the other determines the “issue”: Steak Plains Olive Farm at [111].

[18] As concurrent proceedings progress, however, it may become apparent that the disputes between the parties would be better resolved by being determined in the same forum, requiring the transfer of proceedings from one forum to the other.

[19] Similarly, where the Tribunal has jurisdiction to determine the “issues” and this Court does not, it may become appropriate to transfer the proceedings from the Tribunal to this Court where, for example, the quantum of the claim or the complexity of the issues suggests that the Court may be better equipped to deal with the matter, or at least the parties would prefer that the Court did so.

[20] Likewise, where this Court has jurisdiction in respect of the “issues”, it may emerge that, in reality, the case is better suited to the Tribunal’s procedures to resolve the real issues with as little formality as possible: section 3(d), NCAT Act.

[21] Clause 6(2) of Schedule 4 does not require the Tribunal to have jurisdiction in respect of the “issue” but, rather, for the proceedings to “relate to a matter for which the Tribunal has jurisdiction to exercise a Division function”. The italicised text does not appear in the predecessor legislation. These additional words together with the preceding text which I have quoted indicate that, in order for the Court to transfer a proceeding to the Tribunal, it is sufficient that the proceedings concern the type of matter which falls within the functions allocated to the Consumer and Commercial Division. That is all that is needed to enable a matter to be transferred to the Tribunal if it is otherwise appropriate to do so. There is a difference of language between clause 5 and clause 6 which makes the distinction tolerably clear.

[22] Further, clause 6(2)(b) provides that the transferred proceedings will continue before the Tribunal as if the proceedings had been instituted in the Tribunal. This embraces the situation where the Court had jurisdiction in respect of the “issues” but the Court transfers the proceedings to the Tribunal to determine those “issues”. In transferring the proceedings to the Tribunal under clause 6(2), the Court divests itself of jurisdiction to determine the “issues”. The transferred proceedings will continue in the Tribunal as if it was the proper forum from the outset. Once transferred, the Court no longer has jurisdiction in respect of the “issue” and nor is the Tribunal deprived of jurisdiction by clause 5.

[23] Were it otherwise, clause 6 would be devoid of operation wherever there was more than one proceedings on foot. In that event, even if the parties agreed to transfer proceedings, they could not do so and would be compelled to prosecute parallel proceedings in the Court and Tribunal. Even if it emerged during the progress of the matter in this Court that the “issues” could best be determined in the Tribunal, the proceedings would have to remain in this Court. I do not consider that determination of the proper forum under Clause 5 holds for all time if justice is best served by the dispute being determined in another forum. Such a construction does not conflict with the statutory purpose of clause 5. The vice to which clause 5 is directed is to prevent concurrent proceedings and the risk of inconsistent findings. That vice does not re-emerge if proceedings are transferred from one forum to the other under clause 6 as the result of the transfer is that only one forum will be exercising jurisdiction.” (italics in original)

  1. Having regard to the allegations in the DCNSW proceedings in the SOCC at [20] to [26], the DTCC at [20] to [26], and in the NCAT proceedings in the APOCC at [B] and [D] and the principles in Sunaust Properties at [9], I am satisfied that an issue arising under OSP7114’s strata application, namely whether the Council is in breach of its payment obligations under the 18 September 1996 Agreement, the 22 June 1999 Deed and by-law 34 of scheme 7114, was the subject of a dispute in the DCNSW proceedings within cl 5(7) of Sch 4 to the NCAT Act. This issue necessarily includes the anterior issue of whether the 22 June 1999 Deed continues to be operative. I do not accept that these issues no longer arise by virtue of the filing of the APOCC as there is an allegation in [B3bii] the Council is in breach of its asserted payment obligations and it would be necessary to decide this issue to determine OSP7114’s claims for relief under s 149 of the SSM Act. It follows, now I have become aware of the DCNSW proceedings, that the Tribunal has ceased to have jurisdiction to hear or determine these issues. As recognised in Sunaust Properties at [17], the Tribunal retains its jurisdiction in respect of the residual issues.

  2. In view of this finding, it is appropriate to adjourn proceedings SC 23/31243. It is not feasible to adjourn these proceedings so far as orders 1 and 3 are claimed, as the APOCC at [C] makes clear that order 2 is dependent on order 1 being made.

  3. I accept the Council’s submission that the Tribunal has not been deprived of jurisdiction to deal with the matters raised by the Council’s strata application pursuant to cl 5(7) of Sch 4 to the NCAT Act. On 1 May 2023, when proceedings SC 23/20360 were commenced, there was no issue arising under the Council’s strata application was the subject of a dispute in the DCNSW proceedings.

  4. I also accept the Council’s submission that the NCAT proceedings cannot be transferred to the District Court pursuant to cl 6(1) of Sch 4 to the NCAT Act as the District Court does not have jurisdiction to determine the claims in each of proceedings SC 23/20360 and proceedings SC 23/31243.

  5. Having regard to the allegations in the APOC at (f) and (g) of the Background and [1.6] and the APOC at [A6f], [A7f], [B6biii] and [D1a] the issues of whether the 22 June 1999 Deed continues to be operative and the Council is in breach of its obligations under the 18 September 1996 Agreement, the 22 June 1999 Deed and by-law 34 of scheme 7114 arise in proceedings SC 23/20360. While the Tribunal has jurisdiction to determine proceedings SC 23/20360 including these issues, I am satisfied that these issues should be determined by the District Court. This is because these same issues which arise in proceedings SC 23/31243 can only be determined by the District Court. To permit these issues in proceedings SC 23/20360 to be determined in the Tribunal would give rise to the risk of inconsistent concurrent findings on these issues.

  6. For these reasons, I have decided that the relief sought in the Council’s 13 September 2023 application should be granted. As recognised in Steak Plains Olive Farm at [111], the consequence of this decision is that issue estoppels may arise from the determination of the DCNSW proceedings.

  7. While normally, having regard to the principles in O’Neill at [20]-[23], it would be inappropriate to grant an adjournment pursuant to s 51 of the NCAT Act in circumstances where the Council had failed to comply with orders 5 and 7 of the 25 May 2023 orders, I am satisfied that there are exceptional circumstances that warrant the adjournment of the NCAT proceedings.

Orders

  1. I make the following orders:

  1. the hearing on 16 and 17 November 2023 is vacated;

  2. orders 5 to 16 made on 25 May 2023 are vacated;

  3. the proceedings are to be listed for further directions not before 1 March 2024.

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I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.


Registrar

Decision last updated: 02 November 2023

Cases Citing This Decision

0

Cases Cited

9

Statutory Material Cited

5

McGettigan v Coulter [2024] NSWCA 148
McGettigan v Coulter [2024] NSWCA 148
EB 9 & 10 Pty Ltd v The Owners SP 934 (No 2) [2018] NSWSC 546