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- Unreported Judgment
Seeiseo Pty. Ltd. v Body Corporate for Taralla Apartments CTS 15627 (No. 2) QCAT 10
QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL
Seeiseo Pty Ltd v Body Corporate for Taralla Apartments CTS 15627 (No. 2)  QCAT 10
SEEISEO PTY LTD
BODY CORPORATE FOR TARALLA APARTMENTS CTS 15627
Other civil dispute matters
22 January 2019
On the papers
The applicant pay the respondent’s costs of the application to dismiss proceedings assessed in the sum of $3,539.58 within 14 days of the date of order.
PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – COSTS – where therespondent applied to strike out the proceeding – where the proceeding dismissed on the basis that it lacked substance– where submissions filed in respect of costs – where the usual rule that parties bear their own costs excluded – where costs of the application to dismiss awarded the respondent on a standard basis
Acts Interpretation Act 1954 (Qld), s 14A(1)
Body Corporate and Community Management Act 1997 (Qld), s 149A
Queensland Civil and Administrative Tribunal Act 2009 (Qld) s 47(2)(c), s 100, s 102
Queensland Civil and Administrative Tribunal Rules
2009 (Qld), r 86
Lyons v Dreamstarter Pty Ltd  QCATA 142 Stuart v Queensland Building & Construction Commission  QCATA 135
Self-represented by C Lawrence
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
- By order made on 16 October 2018 matter OCL035-18 was dismissed. The parties were allowed to make submissions on costs.
- The matter was dismissed because the application (as at date of decision) lacked substance and was futile. The applicant, a caretaker under a caretaking and letting agreement with the respondent body corporate, had a right to review its remuneration under the agreement every 5 years. The caretaker sought early review and additional compensation for its work outside the agreed terms of review. There was no entitlement to that under the caretaking agreement nor could any statutory entitlement be called upon.
- The respondent body corporate successfully applied to have the action dismissed. It now seeks its costs of that application.
- Section 100 of the Queensland Civil and Administrative Act 2009 (Qld) (‘QCAT Act’) states:
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.
- That is the usual rule in the Tribunal, that parties are usually expected to bear their own costs. Cost orders are therefore regarded as the exception rather than the rule. That also displaces the usual rule under s 681 of the Uniform Civil Procedure Rules 1999 (Qld) that costs of a proceeding are in the discretion of the court but follow the event, unless the court orders otherwise.
- However there is a proviso to s 100. The proviso is that the usual Tribunal rule is subject to a contrary provision of the QCAT Act or an enabling Act applying.
- Section 47 of the QCAT Act provides:
Dismissing, striking out or deciding if unjustified proceeding or part
- (1)This section applies if the tribunal considers a proceeding or a part of a proceeding is—
- (a)frivolous, vexatious or misconceived; or
- (b)lacking in substance; or
- (c)otherwise an abuse of process.
- (2)The tribunal may—
- (a)if the party who brought the proceeding or part before the tribunal is the applicant for the proceeding, order the proceeding or part be dismissed or struck out or;
(c) make a costs order against the party who brought the proceeding or part before the tribunal to compensate another party for any reasonable costs, expenses, loss, inconvenience and embarrassment resulting from the proceeding or part.
- Though initially it appears the orders available are in the alternative, looking to the purpose of the provisionwhich is intended to facilitate an early conclusion to otherwise futile proceedings or proceedings without substance, it seems inconceivable that the legislature intended the consequent specific provision about awarding costs not to be linked with and used together with the power provided to end proceedings also given in the provision. I conclude where a proceeding is dismissed on the basis of s 47(2)(a) or (b), then 47(2)(c) applies to permit a cost order to be made without the stricture of the usual rule under s 100, that the parties should bear their own costs, applying.
- Accordingly I conclude the usual rule in s 100 that each party to a proceeding should bear their own costs for the proceeding does not apply in circumstances where proceedings are ended early under s 47.
- That is not to say that the tribunal is at liberty to make any cost order it wishes without regard to the facts and circumstances of the matter:
A jurisdiction given in general terms allows the tribunal to make an order as to costs that is justified in the circumstances. It is a broad general discretion which must be exercised judicially, not upon irrelevant or extraneous considerations but upon facts connected with or leading up to the litigation.
- The factors listed in s 102(3) will usually still be relevant to the exercise of the general discretion under s 47(2)(c).
- The applicant commenced proceedings on 1 May 2018. The first part of the relief sought was the appointment of a valuer said to be pursuant to the terms of the caretaking agreement. The respondent challenged whether a dispute about refusal to appoint a valuer existed at that time. Regardless, the respondent did agree to an appointment after the proceedings commenced.
- On 30 May 2018 the body corporate committee wrote to the caretaker as follows:
Lesley and Chris
Rather than wait until the end of the week, we know these things are urgent and important to you and the committee wants to share some good news.
While the committee considers starting now is way too early we do understand you may want an early valuation to help you sell your business and we are willing to help. This has dragged on for 9 months now and frankly could drag on for many more but in the interests of moving on we propose doing exactly what you asked in the QCAT orders:
“We’d like the tribunal to instruct the body corporate for Taralla Apartments to appoint a valuer as per our caretaking and letting agreement and to comply with all relevant clauses in a timely manner moving forward"
The committee has searched for a valuer… We propose appointing David (Leary) immediately so he can get started on the work…
Assuming agreement on the valuation the committee is willing to agree to your suggestion to set up conciliation rather than continue to rack up legal costs and/or take more drastic action which is available.
- It appears Mr Leary was not an acceptable valuer to the caretaker.Shortly after this however he was apparently nominated to the position by an agreed independent body provided for in the body corporate agreement and his appointment was then accepted by the caretaker. That was shortly before 30 June 2018.
- The other principal relief sought by the applicant in the proceedings was a claim for compensation and damages. That was clearly outside the terms of the agreement and not a dispute under s 149A Body Corporate and Community Management Act 1997 (Qld) (‘BCCM Act’) and therefore that claim was bound to fail. The caretaker’s claim in the proceedings, including the application for the appointment of the valuer, had poor prospects of success from commencement of proceedings.
- On this point the caretaker says it was not legally represented and should not be expected to know the complexities of law. However the caretaker had engaged solicitors prior to the caretaker filing the application in OCL035-18. The issue about possible early appointment of a valuer was clearly within any brief to the solicitors at that time. The other claims, for damages and compensation, could appropriately have been the subject of advice then as well.
- By the time the application to dismiss was heard the first part of the caretaker’s claim had been agreed to by the body corporate with the result that the only matter at issue was the claim for damages and compensation.
- The body corporate says it should be awarded the costs of its application to dismiss OCL035-18 on an indemnity basis. It says the caretaker continued with its application despite having been put on notice by the body corporate’s solicitor that its application was misconceived and that costs would be sought against the caretaker.
- But when the solicitor engaged by the body corporate to make the strike out application wrote to the caretaker on 11 June 2018, the notice given was in the form of a proposal of settlement encompassing more than simply the caretaker’s claim in OCL035-18.
- The caretaker was required to withdraw OCL035-18 and also a conciliation application it had lodged at the ‘Commissioner’s’ office and the caretaker was required to ‘remedy all outstanding contraventions of the by-laws that have been notified to you’ without any of those alleged contraventions actually being specified.
- There is no information filed about these additional contentions between the parties. These other factors take the solicitor’s written proposal of settlement well outside an offer of settlement in writing within the scope of Rule 86 of the Queensland Civil and Administrative Rules 2009 (Qld) which permits costs on an indemnity basis.
- In respect of the solicitor’s written notice of 11 June 2018 I note the time given was in any case very short, 4 days. The caretaker was not at that time legally represented.
- Neither party sought nor was granted formal leave to be legally represented in the proceeding. The solicitors for the body corporate appeared at a directions hearing but without leave.
- The body corporate says the ability and the process to apply to dismiss the application would not have been readily apparent to someone who was not legally qualified. It was therefore reasonable, given the nature and complexity of the dispute, for the body corporate to obtain legal advice and assistance.
- I agree the issue as to whether there was a contractual dispute to be litigated in the Tribunal under s 149A of the BCCM Act would not necessarily have been readily apparent to someone who was not legally qualified. I do not agree it is appropriate to engage legal representatives in a forum where leave for legal representation is necessary and expect an order for costs to necessarily follow that however.
- The body corporate says it is a small scheme (9 lots) and it does not have sufficient funds in the bank to pay the solicitor’s costs. If an award is not made in its favour then the body corporate’s success will be eroded having to bear those costs. I note no supporting evidence about the financial position of the body corporate has been provided, and for such a submission to carry weight there needs be such.
- Having regard to the matters set out above I conclude it is appropriate that a cost order under s 47(2)(c) be made in favour of the respondent limited to the costs of the strike out application. I do not accept that there are special circumstances warranting an award of indemnity costs.
- Whilst there was no formal order for legal representation, the proceedings were futile and through the application to dismiss one anticipates the early conclusion of the matter has resulted in a significant saving of time, effort and expense for both parties that would otherwise have been wasted had the matter proceeded to a hearing. It was therefore reasonable for the body corporate to incur costs of legal advice and representation to end the inconvenient and embarrassing proceedings by an application under s 47.
- However the solicitors for the body corporate did not seek leave to represent the body corporate either at a directions hearing,or in making the application to dismiss. They should have and I take that into account in assessing (and reducing) the reasonable costs and expenses that should be paid by the caretaker. The solicitors invoices also includes correspondence with the President SCA which relates to remuneration issues between the parties but are not directly associated with the costs of the dismissal application.
- The respondent’s solicitor own client costs for the strike out application are $7,079.16. I assess the costs payable by the caretaker at 50% of those charges, which is $3,539.58.
 Stuart v Queensland Building & Construction Commission  QCATA 135  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  2 Qd.R 101.
 Section 14A(1) Acts Interpretation Act 1954 (Qld): The interpretation of a provision of an Act, the interpretation that will best achieve the purpose of the Act is to be preferred to any other interpretation.
 Lyons v Dreamstarter Pty Ltd  QCATA 142, , referring to Oshlak v Richmond River Council (1998) 193 CLR 72, 88 and Latoudis v Casey (1990) 170 CLR 534, 557.
 Applicant’s submissions filed 3 July 2018, .
 Respondent’s submissions filed 23 November 2013, [11(a)].
 21 August 2018.
- Published Case Name:
Seeiseo Pty. Ltd. v Body Corporate for Taralla Apartments CTS 15627 (No. 2)
- Shortened Case Name:
Seeiseo Pty. Ltd. v Body Corporate for Taralla Apartments CTS 15627 (No. 2)
 QCAT 10
22 Jan 2019