Queensland Judgments
Authorised Reports & Unreported Judgments
  • sclq logo
  1. Caselaw
  2. QCAT
  3. 2018
  4. Ultimate Property One Management Pty Ltd v Body Corporate for the Pivotal Point Residential Community Title Scheme 33550 (No. 2) - [2018] QCAT 229

Authorised Reports & Unreported Judgments
Exit Distraction Free Reading Mode
  • Unreported Judgment

Ultimate Property One Management Pty Ltd v Body Corporate for the Pivotal Point Residential Community Title Scheme 33550 (No. 2)[2018] QCAT 229

Ultimate Property One Management Pty Ltd v Body Corporate for the Pivotal Point Residential Community Title Scheme 33550 (No. 2)[2018] QCAT 229

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

CITATION:

Ultimate Property One Management Pty Ltd v Body Corporate for the Pivotal Point Residential Community Title Scheme 33550 (No.2) [2018] QCAT 229

PARTIES:

ULTIMATE PROPERTY ONE MANAGEMENT PTY LTD

(applicant)

v

BODY CORPORATE FOR THE PIVOTAL POINT RESIDENTIAL COMMUNITY TITLE SCHEME 33550

(respondent)

APPLICATION NO/S:

OCL031-16

MATTER TYPE:

Other civil dispute matters

DELIVERED ON:

20 July 2018

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Member Howe

ORDERS:

Each party to bear their own costs.

CATCHWORDS:

PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – COSTS – where the applicant was successful in complex litigation – where appropriate matter for legal representation – where the usual order of the Tribunal in cost matters is that both parties bear their own costs – where both parties claimed costs – where both parties alleged conduct by the other party which caused unnecessary disadvantage – where respondent’s failure to narrow the issues for hearing unnecessarily complicated the proceedings and possibly extended the time of the hearing – where the applicant was generally dilatory in its compliance with the orders of the Tribunal – whether the case of the respondent not so weak as being unreasonable to pursue – where the financial circumstances of the parties considered – whether the interests of justice such that another rather than the usual order that each party bear their own costs should apply

Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 48(1), s 100, s 102(3)

Uniform Civil Procedure Rules 1999 (Qld), r 681

Body Corporate for Padstow Place CTS 46532 v AJHJ Property Nominee Pty Ltd [2016] QCAT 481

Cairns Regional Council and Ors v Carey [2012] QCATA 151

Nursing and Midwifery Board of Australia v Faulkner (No 2) [2017] QCAT 273

Samimi v QBSA [2012] QCAT 133

Stuart v Queensland Building & Construction Commission [2016] QCATA 135

REPRESENTATION:

 

Applicant:

B W S Kidston, instructed by Mahoneys Solicitors

 

Respondent:

W Thomas, instructed by MBA Lawyers

APPEARANCES:

 

This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld).

REASONS FOR DECISION

  1. [1]
    This matter was heard over 5 days and involved complex facts and legal issues. Both parties had legal representation and were represented by solicitors and counsel.
  2. [2]
    The applicant was successful in resisting the threat by the respondent to terminate its caretaking and letting contracts. The respondent had served 3 Remedial Action Notices (‘RANs’) and passed a resolution at extraordinary general meeting to that effect.
  3. [3]
    The parties were directed to file submissions about costs. They have done so.
  4. [4]
    The starting point in matters of this type is s 100 of the Queensland Civil and Administrative Act 2009 (Qld) (‘QCAT Act’) which provides:

Other than as provided under this Act or an enabling Act, each party to a proceeding must bear the party’s own costs for the proceeding.

  1. [5]
    Accordingly it can be said that costs orders should be the exception rather than the rule in matters before the Tribunal.[1] That displaces the usual rule under s 681 of the Uniform Civil Procedure Rules 1999 that costs of a proceeding are in the discretion of the court but follow the event, unless the court orders otherwise.
  2. [6]
    By s 102(1) of the QCAT Act the Tribunal may, however, make an order requiring a party to a proceeding to pay all or part of the costs of another party if the interests of justice require it. In deciding whether the interests of justice require it, by s 102(3) the Tribunal may take guidance from a number of listed factors which are set out in the provision, but the Tribunal is not limited to consideration of only those factors.
  3. [7]
    One such factor is whether a party to a proceeding has acted in a way that unnecessarily disadvantages another party, including in the ways mentioned in s 48(1) and (2) of the QCAT Act. Section 48(1) refers to such things as failing to comply with Tribunal orders and conducting proceedings vexatiously.
  4. [8]
    Both parties here level accusations of poor behaviour at the other.
  5. [9]
    The applicant says the respondent has conducted the proceedings in a way that has unnecessarily disadvantaged it.
  6. [10]
    The applicant filed its initiating application on 15 June 2016. In the application the applicant challenged the validity of the 3 RANs.
  7. [11]
    On 25 October 2016 the Tribunal ordered that the respondent advise the applicant and the Tribunal whether ‘it did not intend to rely on any of the RANs in part or in whole’.
  8. [12]
    There was never a narrowing of the alleged breaches relied on in any of the RANs until the last day of the 5-day hearing when Counsel for the respondent conceded that only those items (breaches not remedied) pressed at hearing were relied on.
  9. [13]
    The applicant says its statements of evidence were prepared on the basis that all the breaches alleged in all 3 RANs would be pursued at hearing. There were 44 breaches specified in RAN 1,[2] of which only 8 were pressed at hearing, 32 breaches specified in RAN 2 of which 3 were pressed and 39 breaches specified in RAN 3 of which 7 were relied on as not rectified within time.
  10. [14]
    The voluminous statements of evidence presented by both parties was directed to all 115 breaches in the 3 RANs.
  11. [15]
    But I note at the time of the order directing the respondent to narrow the breaches relied on the bulk of the applicant’s material (statement of evidence of Shengpin Han sworn 14 October 2016) had already been prepared. However, the subsequent conduct of the action could well have been much facilitated and perhaps the hearing time reduced had the respondent advised after 25 October 2016 that more than 80% of the breaches would not be in issue.
  12. [16]
    The respondent says in reply that the respondent did not narrow the breaches relied on in the RANs before hearing because it was waiting for the applicant to particularise its claim and the applicant never did. The applicant failed to file agreed facts and issues or even concede facts until the day of hearing; that the applicant consistently failed to comply with Tribunal directions.
  13. [17]
    There are many letters exchanged between the parties’ solicitors accusing the other of delay and failure to comply with the directions of the Tribunal. Both parties accuse the other of dilatory conduct and the inability to proceed diligently with the filing of statements of evidence and preparation of an agreed statement of facts and issues because both parties awaited material from the other.[3]
  14. [18]
    Most of the complaints about delay appear to have arisen over, and were consequent on, failed attempts by the applicant to sell its caretaking and letting interests to a third party during the course of the litigation. A disagreement followed about the respondent’s costs of acquiescing (distinct from the litigation) to any such transfer of interests.
  15. [19]
    At the time the respondent’s solicitors accused the applicant of carrying on the litigation as a delaying tactic to allow the applicant to find a buyer. I make no finding about delay for tactical reasons not associated with the litigation, though I note such has been held to constitute unnecessarily disadvantaging another party and a cost order made because of it.[4] I have insufficient evidence before me to allow me to reach that conclusion here and of course the outcome of the litigation in end result favoured the applicant accused of avoiding the contest.
  16. [20]
    As at 4 August 2017, the statements of evidence relied on at hearing had already been prepared (save for a supplementary report by Mr Turner of 13 November 2017) and the complaint by the respondents’ solicitors in large part appears to have been reiteration that the applicant had not confirmed that all material intended to be relied on had been filed.
  17. [21]
    The parties had been ordered to file an agreed statement of facts and issues by 4 August 2017. The respondent’s solicitors complained that no statement of agreed facts or issues could be prepared without the additional statements of evidence intended to be filed by the applicant. No additional statements of evidence were prepared save the statement of evidence of Mr Turner. Accordingly no agreed statement of evidence was ever prepared.
  18. [22]
    I conclude the applicant was generally dilatory in complying with the Tribunal’s orders. Its solicitors filed affidavit material deposing to being very busy at the time.
  19. [23]
    I also determine however that the respondent’s failure to narrow the issues for hearing unnecessarily complicated the proceedings and possibly extended the time of the hearing. Further, perusing the exchange of correspondence between the solicitors, the solicitors for the respondent appear to have adopted an unnecessarily aggressive approach in representing their client.
  20. [24]
    There was therefore conduct on both sides that might be categorised as causing unnecessary disadvantage to the other.
  21. [25]
    The dispute was complex. It was appropriate that the parties have legal representation. But just because the matter justifies legal representation does not without more overcome application of the usual rule as to costs in the Tribunal.[5] And as noted in Cairns Regional Council and Ors v Carey:[6]

…the complexity of the dispute and the reasonableness of a serious contest upon it are relevant considerations, although those factors might be thought to cut fairly evenly both ways.[7]

  1. [26]
    What of the strength of the claims of the parties? I am unwilling to conclude that the case of the respondent was so weak and obviously poor from outset that objectively it had limited prospects of success and that should have been realised long before the hearing.
  2. [27]
    There were a number of novel issues raised in the proceedings, including construction of the terms of the caretaking agreement. In result, much turned on this latter point. There were also differences of opinion between the experts about the work expected of a caretaker and the reasonable time required to perform the remedial tasks set in the RANs. It was not unreasonable for the respondent to rely on its expert evidence.
  3. [28]
    The applicant submits the applicant commenced proceedings in response to the unlawful and unjustified actions of the respondent.[8] I do not think the stand adopted by the respondent defending its RANs warrants that description when the litigation is understood in context.
  4. [29]
    There were 115 breaches identified in the 3 RANs. Of those, 18 were “pressed” at hearing. However a significant amount of evidence presented by Mr Han,[9] for the applicant, consisted of describing all the work done remedying the breaches identified in the RANs. Not only in respect of the 18 breaches pressed at hearing, but also setting out how many of the other 97 had also been remedied during the period set by the RANs.
  5. [30]
    Many of the breaches identified in the RANs were based on the respondent’s expert’s observations about the inadequate caretaking work performed by the respondent.
  6. [31]
    What of the financial circumstances of the parties? The applicant continues to own and operate the caretaking business at Pivotal Point. Mr Han and his wife own unit 604 in the scheme as the manager’s lot. The applicant paid $1.38 million for the management rights in August 2014. There was finance from Suncorp funding the lot purchase and the caretaking rights and unit 604 is burdened by security to the extent of $560,000.
  7. [32]
    The applicant generates an annual profit of $220,000. The caretaking and letting work requires Mr Han and his wife to work 60 to 70 hours a week. It is not clear whether that refers to the couple’s collective or individual hours of work.
  8. [33]
    The work is said to be unpaid but the reality is, as the shareholders of the applicant company, they reap the reward through their shareholding.
  9. [34]
    The applicant’s solicitor swore an affidavit on 2 November 2017 during the litigation deposing to the applicant having a surplus of assets over liabilities of approximately $650,000. That was based however on a buyer prepared to pay only $710,000 for the caretaking rights. The litigation has finished and the rights continue through to 2024. They may well be valued more now without the burden of urgent sale forced on the applicant because of the litigation.
  10. [35]
    The applicant’s solicitor describes the value of the shareholding in the applicant as Mr and Mrs Han’s bulk of life savings accumulated over 30 years of work. The respondent says the applicant’s two shareholders have understated their finances. It appears there are 3 properties currently owned by Mr Han or his wife or both of them in addition to their interest (as shareholders) in unit 604. The 3 properties were purchased over the period July 2014 to September 2016 for $2.79 million. Each are encumbered by mortgages and the amount of the mortgages are unknown.
  11. [36]
    There is no evidence that the applicant’s financial circumstances have become strained as a result of this litigation, though the costs incurred by both parties are large. The applicant and its shareholders appear to have reasonably substantial assets.
  12. [37]
    Similarly though there is no evidence that the respondent’s finances are of such modest means that a cost order against the respondent would have a crippling or punitive effect.[10]
  13. [38]
    In all of the circumstances, including consideration of the matters listed in s 102(3) of the QCAT Act, it seems to me that the interests of justice do not warrant an order other than that the usual rule should apply and each party should bear their own costs.

Footnotes

[1]Stuart v Queensland Building & Construction Commission [2016] QCATA 135, [18], which noted the significant change in legislation in the QCAT Act from that governing earlier tribunals and the resultant difference in approach compared to decisions such as Tamawood Ltd & Anor v Paans [2005] 2 Qd R 101.

[2]RAN 1, (similarly RANs 2 and 3), alleged at clause 10.1, 44 failures to comply with obligations under the caretaking agreement (breaches) which, if not remedied, the respondent claimed would entitle it to terminate the caretaking agreement.

[3]Affidavit Rhys Brian Donnelly, sworn 13 October 2017, exhibiting letters dated 3 August 2017 and 14 August 2017 exchanged between the solicitors.

[4]Body Corporate for Padstow Place CTS 46532 v AJHJ Property Nominee Pty Ltd [2016] QCAT 481.

[5]Samimi v QBSA [2012] QCAT 133.

[6][2012] QCATA 151.

[7]Ibid [11].

[8]Counsel’s submissions, 13 June 2018, [9(g)].

[9]Ex 3 to the hearing.

[10]Nursing and Midwifery Board of Australia v Faulkner (No 2) [2017] QCAT 273, [15].

Close

Editorial Notes

  • Published Case Name:

    Ultimate Property One Management Pty Ltd v Body Corporate for the Pivotal Point Residential Community Title Scheme 33550 (No.2)

  • Shortened Case Name:

    Ultimate Property One Management Pty Ltd v Body Corporate for the Pivotal Point Residential Community Title Scheme 33550 (No. 2)

  • MNC:

    [2018] QCAT 229

  • Court:

    QCAT

  • Judge(s):

    Member Howe

  • Date:

    20 Jul 2018

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

Cases Cited

Case NameFull CitationFrequency
Body Corporate for ‘Padstow Place CTS 46532' v AJHJ Property Nominee Pty Ltd [2016] QCAT 481
2 citations
Jump To
Cite 1 - [2016] QCAT 481
Cite 2 - [2016] QCAT 481
Cairns Regional Council and Ors v Carey [2012] QCATA 151
3 citations
Jump To
Cite 1 - [2012] QCATA 151
Cite 2 - [2012] QCATA 151
Cite 3 - [2012] QCATA 151
Nursing and Midwifery Board of Australia v Karen Faulkner (No 2) [2017] QCAT 273
2 citations
Jump To
Cite 1 - [2017] QCAT 273
Cite 2 - [2017] QCAT 273
Samimi v Queensland Building Services Authority [2012] QCAT 133
2 citations
Jump To
Cite 1 - [2012] QCAT 133
Cite 2 - [2012] QCAT 133
Stuart v Queensland Building and Construction Commission [2016] QCATA 135
2 citations
Jump To
Cite 1 - [2016] QCATA 135
Cite 2 - [2016] QCATA 135
Tamawood Ltd v Paans[2005] 2 Qd R 101; [2005] QCA 111
1 citation
Jump To
Cite 1 - [2005] 2 Qd R 101

Cases Citing

No judgments on Queensland Judgments cite this judgment.

1

Require Technical Assistance?

Message sent!

Thanks for reaching out! Someone from our team will get back to you soon.

Message not sent!

Something went wrong. Please try again.