Zistis v Zistis (No 2)

[2019] NSWSC 227

Supreme Court

New South Wales

Medium Neutral Citation:

Zistis v Zistis (No 2) [2019] NSWSC 227

Hearing dates:

4 March 2019

Date of orders:

08 March 2019

Decision date:

08 March 2019

Jurisdiction:

Common Law

Before:

Schmidt J

Decision:

(1)   The Attorney-General for New South Wales pay the plaintiff’s costs, as agreed or assessed, to the extent that they were increased by the intervention of the Attorney-General for New South Wales.

 (2)   Save for the costs the subject of Order 1, the first defendant pay the plaintiff’s costs of the proceedings on the ordinary basis up to 15 January 2018, and thereafter on an indemnity basis.

Catchwords:

CIVIL PROCEDURE — Hearings — Adjournment application — Where party did not appear to press application — Adjournment application dismissed

 

COSTS — Party/Party — General rule that costs follow the event — Whether costs should be ordered on an Indemnity basis

  COSTS — Party/Party — Orders when proceedings involve multiple parties — Interveners — Where applicant’s costs increased as the result of intervention

Legislation Cited:

Civil Procedure Act 2005 (NSW)
Evidence Act 1995 (NSW)
Judiciary Act 1903 (Cth)
Residential Tenancies Act 2010 (NSW)
Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:

Burns v Corbett; Gaynor v Burns (2017) 96 NSWLR 247; [2017] NSWCA 3
Huddart, Parker & Co Pty Ltd v Moorehead (1908) 8 CLR 330
O'Toole v Charles David Pty Ltd (1991) 171 CLR 232; [1991] HCA 14
Silk Bros Pty Ltd v State Electricity Commission of Victoria (1943) 67 CLR 1
Zistis v Zistis [2018] NSWSC 722

Category:

Costs

Parties:

Steve Zistis (Plaintiff)
George Zistis (First Defendant)
NSW Civil and Administrative Tribunal (Second Defendant)
Attorney-General for New South Wales (Intervener)

Representation:

Counsel:
P Santucci (Plaintiff)
A Mitchelmore (Attorney-General for New South Wales)

  Solicitors:
Low Doherty & Stratford (Plaintiff)
Crown Solicitor’s Office (Attorney General for New South Wales)

File Number(s):

2017/153633

Judgment

1. In May 2018 Latham J gave judgment for Mr Steve Zistis against his brother Mr George Zistis, ordering him to give vacant possession of a property at Kensington, where he was living. Mr George Zistis’ case, that he was entitled to live indefinitely in the property, as the result of a representation that Mr Steve Zistis would bequeath the property to him under his will, failed: Zistis v Zistis [2018] NSWSC 722. Mr Steve Zistis has since died and it is his estate which now pursues the question of costs.

2. In issue at trial was whether there was a residential tenancy under the Residential Tenancies Act2010 (NSW) in existence and if there was, whether NCAT had the exclusive jurisdiction to terminate possession of the property. The validity provisions of the Residential Tenancies Act arose in the light of what was decided in Burns v Corbett; Gaynor v Burns (2017) 96 NSWLR 247; [2017] NSWCA 3.

3. After s 78B notices were issued, the Attorney-General for New South Wales intervened in the proceedings, but the case advanced on the intervention also failed.

4. Now in issue is what costs orders should be made in these circumstances.

Mr George Zistis’ motion

5. On 21 February 2019, Mr George Zistis filed a motion seeking the adjournment of the costs hearing on 4 March, because of his ill health. The motion was supported by an affidavit which he had signed before Mr Lazkani.

6. The motion was also listed for hearing on 4 March, but Mr George Zistis did not appear to press his motion. Mr George Zistis had made no contact with the Court, but Mr Lazkani was present, he explained, because the Registrar had suggested to him that he should attend. He did not seek to appear for Mr George Zistis, however, because he had not been authorised to appear on his behalf. He understood that Mr George Zistis was at home.

7. In his affidavit, Mr George Zistis said that he had a heart condition, which was supported by attached documents that he required treatment scheduled for 22 February 2019, which if not successful, would necessitate surgery. What had been the outcome of the procedure is unknown. It was accordingly not apparent that Mr George Zistis was unable to participate in the costs hearing, which had been fixed on a date which suited him.

8. The other parties had been ordered to provide written submissions, which he would then have an opportunity to address at the hearing, he being unrepresented.

9. In the circumstances, given that Mr George Zistis had not appeared to press his motion, it was dismissed and the other parties heard on the question of costs, s 56 of the Civil Procedure Act2005 (NSW) requiring that the Court act to ensure that its practices, procedures and powers were exercised to ensure the just, cheap and quick resolution of the real issues lying between the parties. Section 58, amongst other things, also required the Court to follow what the dictates of justice required in the circumstances, in relation to the granting of any adjournment.

10. Given that Mr George Zistis had, without explanation, simply not appeared to press his adjournment application and did not take any steps to inform the Court as to what, if anything, might be precluding his appearance when his motion was to be heard, even by telephone, I was satisfied that justice did not permit the adjournment of a long fixed hearing, which was opposed.

11. Parties such as Mr George Zistis simply cannot proceed on the basis that the mere filing of a motion will result in an adjournment. Not taking available steps to press such an application will run the risk, which materialised in this case, that the motion will be dismissed.

The costs orders

Mr George Zistis

12. Against Mr George Zistis, an indemnity costs order was sought. Under the Uniform Civil Procedure Rules 2005 (NSW), the usual order is that costs follow the event. That was an order he bear Mr Steve Zistis’ costs of the proceedings, as agreed or assessed.

13. The exercise of the Court’s discretion under s 98 of the Civil Procedure Act to make an indemnity costs order was sought on the basis of on an offer made by Mr Steve Zistis on 18 December 2017, without prejudice except as to costs. There he offered to pay Mr George Zistis $100,000 on completion of the sale of the property, if he vacated it by 1 February 2018, with rent until then being waived and the parties paying their own costs of the proceedings. This offer was open until 15 January 2018, but was not accepted. The matter was listed for hearing on 27 and 28 February.

14. There can be no question that the settlement so offered was not only clear, it capable of acceptance also offered a real compromise, accompanied by a reasonable period for acceptance. It was accordingly admissible under s 131 of the Evidence Act1995(NSW) on this costs application. Further, having been ordered to give Mr Steve Zistis possession as he later was, because of the failure of the case which Mr George Zistis advanced before Latham J, there can be no question that he would have been considerably better off, had he accepted the offer.

15. In all of those circumstances, it is apparent that Mr George Zistis’ rejection of the December offer was unreasonable and that thereby a proper basis has been established for the conclusion that justice demands a departure from the usual costs order. In the result, I am satisfied that Mr George Zistis must be ordered to pay Mr Steve Zistis’ costs of the proceedings, from 15 January 2018, on an indemnity basis.

The Attorney General

16. There is no question that the Attorney having been unsuccessful in the case advanced at trial, a costs order may be made in favour of Mr Steve Zistis: s 78A(2) Judiciary Act1903 (Cth). What Mr Steve Zistis sought was an order as to the additional costs incurred by reason of the Attorney’s intervention.

17. It was contended for Mr Steve Zistis that it was the Attorney who had unexpectedly raised the ‘judicial power’ argument which failed, that not having been raised by Mr George Zistis in his objection to jurisdiction, contending that the power to terminate a residential tenancy did not involve the exercise of judicial power, with the result that NCAT was empowered to determine what lay in issue between the parties.

18. Further, that the argument which the Attorney advanced in oral and written submissions was contrary to what was decided in Burns v Corbett; Gaynor v Burns and in Silk Bros Pty Ltd v State Electricity Commission of Victoria (1943) 67 CLR 1, where it was held that the “power to make an order in favour of a landlord against a tenant for the recovery of the possession of leased land is plainly a judicial power according to any definition of judicial power which can be suggested”: per Latham CJ at 9, citing Griffith CJ in Huddart, Parker & Co Pty Ltd v Moorehead (1908) 8 CLR 330 at 357.

19. But what was advanced in support of the Attorney’s institutional interests as to the scope of NCAT’s powers, required substantial rebuttal and involved significant additional expense being incurred by Mr Steve Zistis particularly, in order to deal with what was only belatedly addressed in further written submissions provided after oral submissions had been made for Mr Steve Zistis, in relation to what was decided in Silk Bros.

20. The Attorney contended that costs were rarely awarded against an intervener, where no novel constitutional issue was raised and what was addressed was integral to the question of the Court’s jurisdiction, which had arisen on the cases which the parties had advanced, in any event. That significant additional expense had been incurred as the result of the intervention, or that the case advanced was against the weight of authority, were also in issue.

21. In O'Toole v Charles David Pty Ltd (1991) 171 CLR 232; [1991] HCA 14, it was held that at [4] it:

“is only in special circumstances that it is appropriate for the Court to make an order for costs against an intervener or, at all events, an order which would have the result that an intervener pay to one of the parties more than the amount by which the costs of that party have been increased by the intervention.”

22. There it was ordered that the Commonwealth pay the respondent’s costs of the proceedings in the High Court which it had sought and in the Federal Court, the respondent’s costs “to the extent, if at all, to which they were increased by the intervention of the Commonwealth in that court”: at [4].

23. At trial Mr Steve Zistis had to establish this Court’s jurisdiction to make the orders which he sought, which was in issue between the parties and resulted in the giving of the s 78B notice. Latham J noted that whether ss 81, 83, 85, 187 and 119 in Part 5 of the Residential Tenancies Act conferred judicial power on NCAT and whether NCAT is a court were finally in issue: at [7]. Her Honour there also noted that:

“The plaintiff‘s position is that NCAT exercises judicial power. The defendant’s and the Attorney General’s position is that NCAT exercises administrative, not judicial power. The defendant maintains that NCAT is a court, whereas the Attorney General acknowledges that it is not a court. It is therefore necessary to address those questions in this judgment before considering the application of Burns v Corbett.”

24. Latham J was satisfied that the powers exercised by NCAT under the Residential Tenancies Act were judicial in nature, accepting the case pressed for Mr Steve Zistis, which relied on both long established and recent authority.

25. Like in O’Toole, it appears that Mr Steve Zistis' costs were increased as the result of the Attorney’s intervention. Given how the parties respectively advanced their cases, Mr Steve Zistis succeeding as he did, because he persuaded Latham J that the weight of authority was against the case unsuccessfully advanced for the Attorney, it must be concluded I consider, that justice requires that the order sought should be made.

26. That the arguments which the Attorney advanced would have been advanced for Mr George Zistis, in the absence of that intervention, is not apparent.

Orders

27. For these reasons I order that:

1. The Attorney-General for New South Wales pay the plaintiff’s costs, as agreed or assessed, to the extent that they were increased by the intervention of the Attorney-General for New South Wales.

2. Save for the costs the subject of Order 1, the first defendant pay the plaintiff’s costs of the proceedings on the ordinary basis up to 15 January 2018, and thereafter on an indemnity basis.

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Decision last updated: 08 March 2019