PENN and LOCAL GOVERNMENT STANDARDS PANEL - [2019] WASAT 83

JURISDICTION     :   STATE ADMINISTRATIVE TRIBUNAL
ACT: LOCAL GOVERNMENT ACT 1995 (WA)
CITATION:   PENN and LOCAL GOVERNMENT STANDARDS PANEL [2019] WASAT 83
MEMBER:   DR B DE VILLIERS, MEMBER
HEARD:   DETERMINED ON THE DOCUMENTS
DELIVERED          :   7 OCTOBER 2019
FILE NO/S:   CC 1370 of 2018
BETWEEN:   STEPHANIE PENN
Applicant
AND
LOCAL GOVERNMENT STANDARDS PANEL
Respondent
ATTORNEY GENERAL OF WESTERN AUSTRALIA
Intervener

Catchwords:

Review of decision by Local Government Standards Panel - Application for costs against Intervener - Role of the Intervener - Substantial delay or prolongation of hearing

Legislation:

Legal Profession (State Administrative Tribunal) Determination 2018 (WA)
State Administrative Tribunal Act 2004 (WA), s 9(b), s 26(1), s 27, s 37, s 46, s 47, s 48, s 87, s 87(1), s 87(2), s 87(3), s 88, s 88(1)

Result:

Orders made for costs

Category: B

Representation:

Counsel:

Applicant	:	Ms D Bechelet
Respondent	:	Mr C Bydder & Mr E Fearis
Intervener	:	Mr C Bydder & Mr E Fearis

Solicitors:

Applicant	:	Avon Legal
Respondent	:	State Solicitor's Office
Intervener	:	State Solicitor's Office

Case(s) referred to in decision(s):

Burnside City Council v Attorney-General (SA) (1994) 63 SASR 65
Chew and Director General of the Department of Education and Training [2006] WASAT 248
Gill & Ors and Wildnight Pty Ltd [2008] WASAT 135
Medical Board of Western Australia and Kyi [2009] WASAR 22
Pearce and Anor and Germain [2007] WASAT 291 (S)
Tanner v The Queen [2001] WADC 207
Treby and Local Government Standards Panel [2010] WASAT 81
Western Australian Planning Commission v Questdale Holdings Pty Ltd [2016] WASCA 32

REASONS FOR DECISION OF THE TRIBUNAL:

Background

This application for costs arises from a decision by the Tribunal to revoke a sanction imposed by the Local Government Standard Panel (the Panel) on Ms Stephanie Penn (the applicant). The Tribunal found on 16 January 2019 that there was inadequate evidence that the applicant made a threat to leave the council meeting of 16 November 2016; or that the applicant left the meeting with the intent, knowledge, understanding or expectation that three other councillors would also leave the meeting after her; or that the previous conduct of councillors at earlier meetings established a basis of common intent to boycott or disrupt the meeting of 16 November 2016.
The applicant is now seeking costs from the Attorney General of Western Australia (the Intervener) since she says the proceeding was void of merit; the proceeding was unnecessarily drawn out by counsel for the Intervener; and that the Intervener ought to be ordered to pay for costs wasted as a result of the proceeding.

Issue

•Should an award of costs be made against the Intervener?

Status of the Intervener in proceedings of this nature

The respondent is not an active party to the proceeding since it had completed its function as a statutorily created body to determine a complaint about the conduct of a councillor of a local government. The Attorney General of Western Australia therefore sought to intervene in the proceeding and leave was granted (s 37 of the State Administrative Tribunal Act 2004 (WA) (SAT Act).
The Intervener, in essence, is under an obligation to assist the Tribunal. The Intervener is not acting on behalf of or defending the decision of the respondent since it is a de novo hearing. As model litigant the Intervener is required to draw the attention of the Tribunal to strengths and weaknesses of the complaint against the applicant. By doing so, the Intervener is expected to assist the Tribunal to reach the correct and preferable decision (s 27 of the SAT Act). For example, the Intervener, when perusing the decision the subject of review, may form the opinion that in light of all the material before the Tribunal the Panel had erred in some regard or that the penalty imposed was not justified in light of the facts available. The Intervener would then be expected, as model litigant, to disclose its opinion to the Tribunal in order for the Tribunal to give due consideration to it. The nature and extent of the Intervener's involvement in a review of a decision of the Panel can therefore vary depending on each case.
Since the hearing is de novo, information that was available to the Panel as well as any additional information that has since become available, may be taken into account. When all information is available, the Intervener can make an informed decision about the role it would adopt to support or oppose the application for review, and the nature and extent of its involvement in a particular proceeding. It is not inconceivable that the Intervener, once all information before the Tribunal is taken into account, may form the opinion that there is not an adequate basis for disciplinary action and in effect support the application to set aside a finding and sanction (see Treby and Local Government Standards Panel [2010] WASAT 81).
Although there is no onus of proof on the Intervener, the Tribunal must as far as factual disputes are concerned be satisfied that a certain factual finding that gives rise to a breach can be made on the basis of the civil test, meaning that it is more likely than not that a certain fact exists. The Intervener can assist the Tribunal in its fact finding and can then make its own submissions whether disciplinary action is justified, and if so, the nature of the penalty or sanction to be imposed.

Can costs be awarded against the Intervener?

The question was raised during the hearing whether costs can be awarded against the Intervener since the Intervener is not a party in the traditional sense of the word. The Intervener in proceedings of this nature seeks to be involved to assist the Tribunal since a decision of the Panel is being reviewed. The Panel is, of course, not a party and neither is the relevant local government or the person who made the complaint.
The Intervener and legal representative of the applicant at the hearing expressed the opinion that costs cannot be awarded against the Intervener. The Intervener by way of letter to the Tribunal revisited its opinion and concluded on proper consideration of the SAT Act that costs can indeed be awarded against the Intervener.
The Tribunal is satisfied that costs can be awarded against the Intervener. Section 87(2) of the SAT Act empowers the Tribunal to make an order for the payment by 'a party' of all or any costs of the other party. A 'party' is relevantly defined by s 26(1) of the SAT Act in the case of a 'person intervening' in the proceeding - this includes the Intervener in this matter.

Comments made by the Tribunal when the decision was revoked

In its oral reasons for decision handed down on 16 January 2019 in which the Tribunal revoked the decision of the respondent to impose a sanction on the applicant, the Tribunal, in summary, observed the following in regard to the conduct of the Intervener during the proceeding:
(1)A proper reading of the material and witness statements by a legally trained person should have raised concerns prior to the hearing about the merit of a finding of a breach and the imposition of a sanction. Such concern could have caused the Intervener not to seek intervention; or to intervene with a limited role; or to intervene and thereby assist the Tribunal to identify potential shortcomings in the material. In this matter the Intervener adopted what the Tribunal termed an adversarial approach which, against the proper reading of all the material, was not justified.
(2)The Intervener contributed to the hearing extending longer than was justified. A hearing of this duration was not justified in light of the materials before the Tribunal. Costs were in the opinion of the Tribunal substantially inflated as a result of the approach adopted by the Intervener.
(3)The Intervener, in effect, expanded the hearing into an inquiry about the conduct of other councillors at previous meetings with the underlying proposition that there was an ongoing scheme orchestrated by the applicant to frustrate meetings that reached a climax when she left the chambers of the special meeting. This proposition was not supported by the materials available to the Intervener prior to the hearing and was shown to be without any merit during the hearing. The line of questioning adopted by the Intervener nevertheless caused the hearing to consume much more time than was justified or proportionate to the nature of the issue before the Tribunal.

Statutory framework for costs

Section 87 of the SAT Act relevantly provides as follows:
(1)Unless otherwise specified in this Act, the enabling Act, or an order of the Tribunal under this section, parties bear their own costs in a proceeding of the Tribunal.
(2)Unless otherwise specified in the enabling Act, the Tribunal may make an order for the payment by a party of all or any of the costs of another party or of a person required to produce a document or other material on the application of the party under section 35.
(3)The power of the Tribunal to make an order for the payment by a party of the costs of another party includes the power to make an order for the payment of an amount to compensate the other party for any expenses, loss, inconvenience, or embarrassment resulting from the proceeding or the matter because of which the proceeding was brought[.]
Section 88 of the SAT Act relevantly provides as follows:
(1)In this section
costs of a proceeding means costs of, or incidental to, a proceeding of the Tribunal, other than costs of a party.
(2)The Tribunal may order that all or any of the costs of a proceeding be paid by a party.
(3)If the matter that is the subject of the proceeding comes within the Tribunal's review jurisdiction, the Tribunal cannot make an order under this section against a party unless
(a)the party brought or conducted the proceeding frivolously or vexatiously; or
(b)section 87(4) applies to the party; or
(c)circumstances have arisen in which the Tribunal could make an order under section 46, 47 or 48.

Submissions by the parties

The applicant contends, in summary, why costs should be awarded to her.
The applicant says the Intervener conducted the proceeding frivolously; it was an abuse of process; misconceived and for an improper purpose. In doing so the Intervener caused unnecessary disadvantage to the applicant and thereby caused her to expend substantial costs on legal representation. The applicant acted reasonably by seeking legal representation because she previously misunderstood the proceedings of the Panel and was concerned about the complexities that may arise as a result of inconsistent evidence. The applicant makes reference to several critical observations by the Tribunal about the manner in which the Intervener conducted the proceeding and the manner in which the Intervener undertook examination of witnesses. Ultimately the applicant says the Intervener should have withdrawn or if there was merit for it to participate it should have truncated the hearing rather than prolonging it. On proper reflection the matter could have been resolved in less than a day or even on the documents. An amount of $45,001.40 ought to be awarded to the applicant.
The Intervener contends, in summary, why costs should not be awarded against it, or if costs are awarded, what would be a reasonable basis for calculating costs.
The Intervener says that the basic principle in regard to which the Tribunal operates is found in s 87(1) of the SAT Act whereby each party is responsible for their own costs regardless of the outcome of a proceeding. Although the Tribunal made critical comments about the possible prolongation of time, the additional time spent in the hearing, if any, was not substantial. The hearing was ultimately concluded within two days. There was no substantial delay as a result of the Intervener's input. The oral testimonies of witnesses assisted the Tribunal to ascertain whether a case had been made for disciplinary proceedings. If costs were to be awarded it should be limited to what the Tribunal regards as unreasonable conduct of the Intervener and taking into account the value of the subject matter in proportion to the costs incurred.

Consideration

It is axiomatic that the Tribunal is an own cost jurisdiction (s 87(1) of the SAT Act), but that orders may be made in appropriate circumstances for the costs of another party to be paid, in full or in part (s 87(2) of the SAT Act). Costs may also be awarded for other costs incidental to the cost of the proceeding (s 88(1) of the SAT Act). The Tribunal is therefore clothed with a wide discretion to award costs when so justified, but within the context of the Tribunal, in essence, being an own cost jurisdiction, resolving matters speedily, and to minimise the cost to parties (s 9(b) of the SAT Act).
In the matter of Pearce and Anor and Germain [2007] WASAT 291 (S) (Pearce) an overview was given by Chaney J of the cost regime applied by the Tribunal and the criteria to be considered prior to the award of costs. In the matter of Gill & Ors and Wildnight Pty Ltd [2008] WASAT 135 the criteria as discussed in Pearce were, for the sake of convenience, summarised as follows at [20]:
In Pearce, his Honour set out the following principles for the consideration of costs applications by the Tribunal:
(i)The starting point of the Tribunal is that it is a 'no cost' jurisdiction ([8]).
(ii)The cost regime that was applicable to the previous Commercial Tribunal does not apply to the State Administrative Tribunal ([11]).
(iii)The objectives of the State Administrative Tribunal are furthered by its being essentially a 'no cost' jurisdiction ([17]).
(iv)Where there is a genuine dispute and the respective rights are unclear and parties seek a determination, the 'starting point remains that each party should expect to pay their own costs' ([24]).
(v)The Tribunal does have the power to award costs, and it is not appropriate to 'delineate the particular circumstances' in which the discretion to award costs would be exercised favourably ([22]).
(vi)Some of the factors (not an exhaustive list) that may contribute to the Tribunal making a cost order are for example -
a.A party has conducted itself unreasonably, particularly where the conduct leads to unnecessary costs to the other party.
b.A party has conducted itself inappropriately, particularly where the conduct leads to unnecessary costs to the other party.
c.Where credibility of evidence is at the heart of a matter.
d.Where the application undermine the integrity of proceedings under the relevant Act.
e.The relative weakness of a case, it being incredible or implausible or ''obviously unmeritorious''.
f.If a party has to embark in proceedings to 'vindicate its clear contractual entitlements'. ([22] - [24])[.]
In the current proceeding the Tribunal accepts that the Intervener was under an obligation to participate in the proceeding. The material received from the respondent was clearly very limited; the applicant had apparently misunderstood the process before the respondent and did not file all the material that she later realised she could have filed; and witness statements of several persons who had attended the special meeting had been settled. The preparatory work undertaken by the Intervener was therefore justified since it was the applicant who sought a review and the Tribunal had to be provided with a more elaborate outline of evidence than was available to the Panel.
It must be noted that the applicant decided to retain counsel to seek a review of a 'minor breach' with a sanction to attend four hours of training. Furthermore it was the obligation of counsel to explain to the applicant that the Tribunal is, in essence, an own costs jurisdiction and even if she was successful, a costs order would not necessarily follow. The applicant therefore had to weigh up the sanction imposed vis-à-vis the costs of a review. In similar vein that the Intervener must consider proportionality in the nature and extent of its role, the applicant must take into account the risk of litigation, the cost of litigation, and the nature of the sanction against which she objects. Although the Tribunal accepts that the applicant wanted to clear her name, the costs of doing so cannot necessarily be attributed to the Intervener. Furthermore, the decision of the applicant to retain counsel is understandable, but at the same time the nature and complexity of the review did not necessarily justify the costs incurred. The case put forward by the applicant was relatively straightforward and she was vindicated. She denied, in essence, that she had left the meeting in a manner that justifies a disciplinary finding, and she succeeded.
On the other hand, the role of the Intervener also deserves consideration. The Intervener is also required to take into account the nature and scale of the matter before the Tribunal to ascertain its own involvement. Proportionality applies equally to the applicant and to the Intervener. The Tribunal accepts that the preparatory work that had been undertaken by the Intervener was justified. It is only by undertaking the preparations that the Tribunal had the full benefit of all relevant evidence and material. The concerns expressed by the Tribunal during the hearing was not directed at the preparation undertaken by the Intervener. It was directed at what followed during the hearing.
A plain reading of the materials prior to the hearing would have exposed several weaknesses in the case against the applicant. The Intervener did not, in its submissions to the Tribunal, acknowledge the weaknesses or identify specific areas in which examination was required so as to limit time. The Intervener spent substantial time, without any real benefit to the Tribunal, in examination of witnesses even after it became clear that the witnesses had contradictory and vague recollection of events. The proposition that the Intervener sought to sustain namely, that the applicant left the meeting with the intent, knowledge, understanding or expectation that three other councillors would also leave the meeting after her; or that the previous conduct of councillors at earlier meetings established a basis of common intent to boycott or disrupt the meeting of 16 November 2016, was never likely to be established by the witness statements as filed or by the resultant cross-examination. The Tribunal is critical in this regard of the Intervener's contribution. A model litigant would have disclosed to the Tribunal possible shortcomings of the case and perhaps suggested areas where specific examination could occur so as to reduce the time wasted in examination. This would have saved substantial time. The Intervener, however, adopted what could best be described as adversarial examination which ultimately bore no fruit, but came at a higher cost to the applicant.
The effort by the Intervener to draw some link between the conduct of some councillors at earlier meetings in order to sustain the proposition that there was a trend of disruption to meetings or that the previous collusion culminated in a walk-out at the special meeting, was at best speculative. Although this part of the examination may not have taken much time, it highlighted the adversarial approach adopted by the Intervener and its desire to succeed with some form of disciplinary finding at all cost. The Tribunal accepts that a witnesses who is being cross-examined need not be informed of the exact nature of examination prior to commencing cross-examination (Tanner v The Queen [2001] WADC 207 at [18]), but in this matter the conduct of counsellors at earlier meetings had not been the subject of a complaint or of disciplinary proceedings.

Two aspects about the conduct of the Intervener are noteworthy: firstly, the conduct of councillors at previous meetings was not a subject of a complaint, and secondly, the councillors were not put on notice that the Intervener had developed a proposition that their failure to attend previous meetings or them withdrawing from previous meetings, was part of a scheme to frustrate the passing of a resolution. The councillors under examination were therefore not prepared to explain their whereabouts or consult their diaries to ascertain what had motivated their conduct at a specific meeting.
The Tribunal does not agree with the applicant that the proceeding was an abuse of process, that the Intervener conducted itself frivolously, or that the Intervener conducted the matter for an improper purpose. The conduct of the Intervener does not come within the description as found is in Chew and Director General of the Department of Education and Training [2006] WASAT 248 at [85] or in Medical Board of Western Australia and Kyi [2009] WASAR 22 at [73]). The Tribunal is satisfied that the Intervener had to intervene in order to assist the Tribunal; that the Intervener acted professionally and was generally seeking to uphold good governance of a local government councillor; and that there was a proper purpose for the proceeding since a finding had been made by the respondent; the applicant sought a review; and the Intervener assisted the Tribunal.
The Intervener is however open for criticism for having caused the hearing to be drawn out and prolonged in a manner that was not justified.
The Tribunal notes that the Intervener is of the opinion that the hearing had been set down for two days which was concluded within the time and that if time as wasted, it was minimal. It is, of course, a 'question of fact and degree' whether the Intervener's involvement resulted in the proceeding being 'substantially' longer than in would have been without its involvement (Burnside City Council v Attorney-General (SA) (1994) 63 SASR 65 at 68). The Intervener says that even if its involvement had caused the hearing to take longer, it was not for a substantial period.
The Tribunal does not accept this contention.
In regards to the detailed witness statements filed, the issues to be explored in examination of witnesses could have been identified more effectively by the Intervener. It was apparent that witnesses had different recollection of events; that even some of those who had ostensibly heard the threat by the applicant to leave the meeting had contradictory recollections; and one witness who sat closest to the applicant did not hear the remark. The proceeding turned on the question whether the remark was uttered by the applicant. The Intervener engaged in examination that bore little relevance to that question and sought to draw into consideration the conduct of some councillors at previous hearings. What could have been, at most, a three hour hearing (based on the material that had become available) turned into a hearing of one and a half days.
The Intervener may not regard a one and a half day duration of a hearing as substantial, but in light of the evidence and materials available prior to the hearing, the clarity of the specific questions of fact to be determined, and the lack of relevance of conduct during previous meetings, the Intervener caused the hearing to be prolonged by at least six hours which in light of the total duration of the matter (around 9.2 hours) and proportionality, can be regarded as substantial.
The Tribunal therefore finds that the Intervener acted unreasonably by causing the hearing to become drawn out for substantially longer than was necessary. The Intervener should be ordered to pay the costs of the applicant for the period for which the hearing was unnecessarily drawn out. This finding is consistent with the standard expressed by Murphy JA that the even in a statutory context, where generally speaking no costs are awarded, costs may be awarded if it is 'fair and reasonable' (Western Australian Planning Commission v Questdale Holdings Pty Ltd [2016] WASCA 32 at [51]). In this matter both legs identified by the court are met, namely that the additional time spent was substantial and that it is fair and reasonable for costs to be awarded for the additional time.
The Tribunal concurs with the applicant that the basis for calculating costs is not what counsel for the applicant charges, but should be set in accordance with the Legal Profession (State Administrative Tribunal) Determination 2018 (WA) whereby the cost for counsel is set at $341 per hour and for the instructing solicitor at $319 per hour. The total costs to be awarded for legal costs is therefore $3,960.
Section 87(3) of the SAT Act empowers the Tribunal:
… to make an order for the payment of an amount to compensate the other party for any expenses, loss, inconvenience, or embarrassment resulting from the proceeding or the matter because of which the proceeding was brought.
The Tribunal finds that an award of costs under this section is not justified. The Intervener had no role in the complaint that was lodged against the applicant, or in the initial investigation of the complaint, or in the finding of the Panel.
The Tribunal accepts that the entire proceeding caused the applicant substantial inconvenience and embarrassment. It may even give rise to broader policy questions about the way in which proceedings of this nature are conducted by the Intervener. However, the Intervener's role was limited to the review hearing. Although the Tribunal had been critical of aspects of the Intervener's role, that criticism does not amount to the applicant falling within the scope of s 87(3) of the SAT Act.
The applicant seeks costs other than costs of a party to be awarded pursuant to s 88 of the SAT Act. The Tribunal has already found that the Intervener did not conduct the proceeding frivolously or in a manner described in s 46, s 47 or s 48 of the SAT Act. No costs should therefore be awarded under these sections.
The application for costs should therefore succeed and the Intervener should be ordered to pay to the applicant the amount of $3,960.

Orders

1.The application for costs succeeds.
2.The Intervener pay to the applicant by no later than 1 November 2019, the amount of $3,960.

I certify that the preceding paragraph(s) comprise the reasons for decision of the State Administrative Tribunal.
DR B DEVILLIERS, MEMBER
8 OCTOBER 2019