Tom Builder Pty Ltd v Quan Duong (No 2)

Tom Builder Pty Ltd applied for costs in respect of the unsuccessful counter-claim brought by Van Quan Duong. The application was made on the papers, pursuant to section 32 of the Queensland Civil and Administrative Tribunal Act 2009. Tom Builder sought either costs in the sum of $13,000, costs on an indemnity basis from 22 September 2012, or costs on a standard basis in accordance with the District Court Scale. The court was required to determine whether an order for costs should be made in Tom Builder's favour, and if so, on what basis.

In reaching its decision, the court considered the usual position as to costs in the Tribunal, the powers of the Tribunal to award costs in building disputes, and the relevant factors to be considered in exercising its discretion. The court noted that the usual position as to costs in the Tribunal is that each party must bear their own costs, unless otherwise provided under the QCAT Act or an enabling Act. However, in building disputes brought under the Queensland Building Services Authority Act 1991, the Tribunal has a broad general discretion to award costs. The court also considered the factors relevant to the exercise of this discretion, including the nature of the claim, the strength of the claim, and whether either party unnecessarily disadvantaged the other.

In this case, the court found that while Tom Builder was successful in having the counter-claim dismissed, there were factors which weighed against making a costs order in its favour. These factors included the lengthy history of the proceeding, Tom Builder's failure to progress its own claim, and the very brief period that the offer to settle was open. The court also noted that Mr Duong was put to the costs of two hearings rather than one, and an appeal process, due to Tom Builder's neglect to progress the proceeding in the first place. The court considered that these factors deserved greater weight than the other factors, and therefore ordered that both parties must bear their own costs.

This decision highlights the importance of considering all relevant factors when exercising the Tribunal's discretion to award costs in building disputes. While success in a claim may be a relevant factor, it is not the only factor to be considered. The court must also consider the nature and complexity of the dispute, the conduct of the proceeding, and whether either party unnecessarily disadvantaged the other. In this case, the court found that the factors weighing against making a costs order in Tom Builder's favour were sufficient to tip the scale against the making of the order.