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J.Mac Constructions Pty. Ltd. v Queensland Building and Construction Commission[2019] QCAT 249

J.Mac Constructions Pty. Ltd. v Queensland Building and Construction Commission[2019] QCAT 249

QUEENSLAND CIVIL AND

ADMINISTRATIVE TRIBUNAL

CITATION:

J.Mac Constructions Pty Ltd v Queensland Building and Construction Commission [2019] QCAT 249

PARTIES:

J.MAC CONSTRUCTIONS PTY LTD

(applicant)

v

QUEENSLAND BUILDING AND CONSTRUCTION COMMISSION

(respondent)

APPLICATION NO:

OCR235-19

MATTER TYPE:

Costs

DELIVERED ON:

23 August 2019

HEARING DATE:

5 August 2019

HEARD AT:

Brisbane

DECISION OF:

Member Dr Collier

ORDERS:

Application dismissed.

CATCHWORDS:

STATUTES – ACTS OF PARLIAMENT – INTERPRETATION – costs – interpretation of the Queensland Building and Construction Commission Act 1991 (Qld) – meaning of ‘for the benefit of a creditor’

ADMINISTRATIVE LAW – ADMINISTRATIVE TRIBUNALS – QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL ACT – costs – Queensland Civil and Administrative Tribunal Act 2009 (Qld) – s 100 – s 102

PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – COSTS – Queensland Civil and Administrative Tribunal Act 2009 (Qld) – s 100 – s 102

Professional Engineers and Other Legislation Amendment Act 2014 (Qld)

Queensland Building and Construction Commission Act 1991 (Qld), S 56AC

Queensland Building and Construction Commission and Other Legislation Amendment Act 2014 (Qld)

Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 32, s 100, s 102, s 102(3)(a), s 102(3)(b), s 102(3)(c), s 102(3)(d), s 102(3)(e), s 102(3)(f), s 107(1)

Ascot v Nursing & Midwifery Board of Australia [2010] QCAT 364

Ezra Constructions Pty Ltd & Ors v Queensland Building and Construction Commission & Ors [2019] QSC 47

J.Mac Constructions Pty Ltd v Queensland Building and Construction Commission [2019] QCAT (unpublished)

Ralacom Pty Ltd v Body Corporate for Paradise Island Apartments (No 2) [2010] QCAT 412

Tamawood Limited v Paans [2005] QCA 111

REPRESENTATION:

 

Applicant:

Self-represented

Respondent:

Self-represented

APPEARANCES:

The claim for costs 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]
    Colonial Properties Pty Ltd (‘Colonial’) was a builder that entered a members’ voluntary winding-up approved by the Queensland Supreme Court on 15 November 2013. At all relevant times Colonial was solvent and able to meet its debts as and when they fell due. Upon liquidation in January 2016 it returned 100 cents in the dollar to all creditors and a substantial sum to members.
  2. [2]
    At the date of the Winding-up Order, 15 November 2013, Craig Mortensen was secretary of Colonial Properties.
  3. [3]
    Mr Mortensen was also a director and secretary of J.Mac Constructions Pty Ltd (‘J.Mac’), a successful builder not financially related to Colonial, on and around the date when Colonial had the liquidator appointed.
  4. [4]
    Since 30 July 2015 J.Mac had been a QBCC licence-holder in the class: Builder - Low Rise. On 17 April 2018 J.Mac submitted an application to the QBCC seeking to be licenced also as: Builder - Medium Rise.
  5. [5]
    As a result of this application by J.Mac, the QBCC noticed that Mr Mortensen had been a director of Colonial at the time when a liquidator had been appointed.
  6. [6]
    As a result, the QBCC notified Mr Mortensen on 24 May 2018 that he had been categorised as an excluded individual under s 56AC of the Queensland Building and Construction Commission Act 1991 (‘QBCC Act’) as a result of him being secretary of Colonial Properties on the date of the Winding-up Order in 2015.
  7. [7]
    A further consequence of this was that, because Mr Mortensen had been declared an excluded individual because of his involvement as an officer of J.Mac, J.Mac had been declared by the QBCC to be an excluded company on 24 May 2018.
  8. [8]
    Amendments to the Queensland Building and Construction Act came into effect on 1 July 2015 affecting the provisions dealing with excluded individuals and companies.[1]
  9. [9]
    A combination of the date when Mr Mortensen was declared by the QBCC to be an excluded individual and the dates associated with the amended legislation led to the QBCC purporting to declaring Mr Mortensen to be an excluded individual for 5 years with no basis on which he could appeal that decision.
  10. [10]
    J.Mac, on behalf of Mr Mortensen, applied to this Tribunal to answer two preliminary questions concerning Mr Mortensen’s status, in particular whether he had been lawfully declared by the QBCC to be an excluded individual for the period involved.[2]
  11. [11]
    This Tribunal made findings relevant to the preliminary questions posed by the parties[3] and, with consent of the parties, on 10 April 2019 set aside the decision of the QBCC that J.Mac was an excluded company. 
  1. [12]
    The Applicant J.Mac now seeks to recover the costs that it incurred in its action against the Respondent, the QBCC, in its earlier application.

The rules relating to costs

  1. [13]
    The starting rule concerning costs in this Tribunal is found in s 100 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (‘QCAT Act’) that parties should bear their own costs in proceedings.
  2. [14]
    Section 102 of the QCAT Act sets out the basis on which this Tribunal may award costs in a matter:
  1. The tribunal may make an order requiring a party to a proceeding to pay all or a stated part of the costs of another party to the proceeding if the tribunal considers the interests of justice require it to make the order.

  1. In deciding whether to award costs under subsection (1) or (2) the tribunal may have regard to the following—
  1. whether a party to a proceeding is acting in a way that unnecessarily disadvantages another party to the proceeding, including as mentioned in section 48(1)(a) to (g);
  2. the nature and complexity of the dispute the subject of the proceeding;
  3. the relative strengths of the claims made by each of the parties to the proceeding;
  4. for a proceeding for the review of a reviewable decision—
  1. whether the applicant was afforded natural justice by the decision-maker for the decision; and
  2. whether the applicant genuinely attempted to enable and help the decision-maker to make the decision on the merits;
  1. the financial circumstances of the parties to the proceeding;
  2. anything else the tribunal considers relevant.
  1. [15]
    The Tribunal will also assess whether, if costs are to be awarded, they are to be awarded at the standard rate, or some other rate, including indemnity costs.
  2. [16]
    Further, section 107(1) of the QCAT Act requires that, ‘If the tribunal makes a costs order under this Act or an enabling Act, the tribunal must fix the costs if possible’.
  3. [17]
    Both parties had legal representation before the Tribunal in the substantive matter. It would be reasonable to conclude that the Tribunal granted the right to be represented because of the relative complexity of the law involved.
  4. [18]
    The basis on which costs should be considered in this Tribunal is described in Ralacom Pty Ltd v Body Corporate for Paradise Island Apartments (No 2) where the Tribunal said:[4]

"Under the QCAT Act the question that will usually arise in each case in which costs are sought is whether the circumstances relevant to the discretion inherent in the phrase ‘the interests of justice’ point so compellingly to a costs award that they overcome the strong contra-indication against costs orders in s 100."

  1. [19]
    In assessing whether to award costs guidance is provided by decisions such as Ascot v Nursing & Midwifery Board of Australia where the Tribunal said:[5]

The public policy intent of the provisions in the QCAT Act is plain. The tribunal was established as a no costs jurisdiction. That may be departed from where the interests of justice require it. The considerations identified in s 102(3) are not grounds for awarding costs. They are factors that may be taken into account in determining whether, in a particular case, the interests of justice require the tribunal to make a costs order.

The Applicant’s case for seeking costs

  1. [20]
    The Applicant is seeking $71,821.68 in costs in this matter, being an amount calculated by a costs assessor according to the District Court scale, representing the whole of the Applicant’s allowable costs in the matter.[6]
  2. [21]
    The Applicant sets out in its submissions dated 8 May 2019 factors under five of the headings found in s 102(3) of the QCAT Act that are relevant to whether it is entitled to its costs in this matter, namely:
    1. Whether a party to a proceeding is acting in a way that unnecessarily disadvantages another party to the proceeding;
    2. The nature and complexity of the dispute;
    3. The relative strengths of the claims made by each of the parties to the proceeding;
    4. Whether the Applicant genuinely attempted to enable and help the decision-maker to make the correct decision on the merits; and
    5. The financial circumstances of the parties to the proceeding.
  3. [22]
    Each of the following headings contains a summary of the basis on which the Applicant seeks costs.

Factor 1 - Whether a party to a proceeding is acting in a way that unnecessarily disadvantages another party to the proceeding[7]

  1. [23]
    The Applicant argues that it was unnecessarily put to the cost of having the decision that Mr Mortensen was an excluded individual reviewed because:
    1. The relevant decision of the Respondent was a defective exercise of power;
    2. The Respondent failed to give proper consideration to whether the appointment of a liquidator to Colonial was ‘for the benefit of a creditor’; and
    3. The resolution of the preliminary questions proved sufficient to have the relevant decision of the Respondent being set aside.

Factor 2 - The nature and complexity of the dispute[8]

  1. [24]
    The Applicant acknowledges that the Application ‘… involved some complex matters of statutory construction …’.[9]

Factor 3 - The relative strengths of the claims made by each of the parties to the proceeding[10]

  1. [25]
    In this case the Applicant says that the Respondent took an unreasonable position and presented a weak case before the Tribunal.

Factor 4 - Whether the Applicant genuinely attempted to enable and help the decision-maker to make the correct decision on the merits[11]

  1. [26]
    The Applicant says that it genuinely attempted to assist the Respondent, in particular in offering the Applicant’s view as to the proper meaning of the term ‘for the benefit of a creditor’. The Applicant believes that, had the Respondent:

"…engaged in any reasonable analysis of the words “for the benefit of a creditor” in s 56AC of the QBCC Act or the transitional provisions, the QBCC could not have reached the conclusion it did, and J.Mac would not have been required to incur the costs of the subject Application."[12]

Factor 5 - The financial circumstances of the parties to the proceeding[13]

  1. [27]
    The issue raised here by the Applicant is, essentially, that the Applicant should not have been required to expend its resources on its Application.

The Respondent’s case opposing costs

  1. [28]
    It is evident from the Respondent’s submission that it contends that it has been prompt in attending to matters concerning the principal application and was not dilatory.[14] I do not disagree with this and the Respondent has not suggested otherwise.
  2. [29]
    The Respondent says that the starting point for all costs decisions in the Tribunal is in QCAT Act s 100, namely that the Tribunal is a no costs jurisdiction and that costs should be considered only ‘… where the interests of justice require it’.[15] This approach is further explained in the decision of Ralacom Pty Ltd v Body Corporate for Paradise Island Apartments (No 2), cited in paragraph [18] above.
  3. [30]
    Like the Applicant, the Respondent refers to QCAT Act s 102 and offers comments on each relevant factor. The Respondent’s view relevant to each factor is considered below.
  4. [31]
    The Respondent says that the Applicant has not overcome the strong contra-indication against costs orders in the QCAT Act and is not entitled to costs in this matter.[16]
  5. [32]
    The Respondent says that, in the event that the Tribunal is minded to award costs in this matter, costs should not be awarded on an indemnity basis.[17]

Analysis

  1. [33]
    The Applicant makes reference to five of the factors to which the Tribunal may have regard when deciding whether to award costs under QCAT Act s 102(3).
  2. [34]
    Two of those may be disposed of immediately.
  3. [35]
    In relation to Factor 2, paragraph [24] above, the matter did involve a complex question of statutory construction. It would seem to me that the fact that the principal matter involved complex matters of statutory construction speaks against the Applicant recovering costs because the complexity involved must have been the same for each party. Further, because of the complexity, and the associated uncertainty in interpreting the legislation, both parties had an interest in resolving the controversy. This factor is not relevant in deciding the issue of costs here.
  4. [36]
    In relation to Factor 5, paragraph [27] above, the Respondent was at no time in a difficult financial situation and the costs of the proceeding, although large, were never going to prejudice the ability of the Applicant to seek or obtain redress. This factor is not relevant in deciding the issue of costs here.
  5. [37]
    Turning to Factor 1 mentioned in paragraph [23] above, I am not persuaded that the conduct of the Respondent unnecessarily disadvantaged the Applicant. A wrong decision by the Respondent on a complex matter of statutory interpretation is not an ‘unnecessary disadvantage’. I also note that the parties resolved the matter at the first opportunity after the Tribunal had answered the preliminary questions, which indicates reasonable conduct on the part of the Respondent.
  6. [38]
    As to the term ‘for the benefit of creditors’, the meaning of this term has previously been given scant attention by courts and tribunals when dealing with matters under the QBCC Act, despite its important part in that legislation and the importance of the term in matters of insolvency law. It has been considered recently by Queensland Supreme Court and, even then, that Court did not appear to provide much guidance concerning the meaning of the term in this context.[18] It is not to be unexpected that parties, even an entity with the resources of the Respondent, continue to find the meaning of that term challenging in the absence of useful guidance.
  7. [39]
    I am not persuaded that, in respect of Factor 1, the Applicant has overcome the strong contra-indication against costs orders.
  8. [40]
    Turning to Factor 3, the assertion by the Applicant that the that the Respondent took an unreasonable position and presented a weak case before the Tribunal is not sustained by the facts. The Respondent’s case was not weak. Resolving the legislative conundrum involved was not simple. Nor was the conduct of the Respondent unreasonable. The Respondent may have been wrong in the final analysis, but it had acted reasonably.
  9. [41]
    I am not persuaded that, in respect of Factor 3, the Applicant has overcome the strong contra-indication against costs orders.
  10. [42]
    Finally, concerning Factor 4, the Applicant’s argument turns on the Respondent having been unreasonable in its interpretation of the term ‘for the benefit of a creditor’. The same considerations apply as mentioned above: the issue was tractable only after substantial effort and the conduct of the Respondent in pressing its interpretation was not unreasonable, nor was its conduct of the proceeding.
  11. [43]
    Thus I am not persuaded that, in respect of Factor 4, the Applicant has overcome the strong contra-indication against costs orders.
  12. [44]
    Taking account of all the factors mentioned in s 102(3) together, rather than individually, it remains my conclusion that the interests of justice do not require the Applicant to be compensated for costs. This remains the case even considering the proposition described by Keane JA (as he then was) in Tamawood Limited v Paans[19] where he said:[20]

"In the absence of countervailing considerations, where a party has reasonably incurred the cost of legal representation, and has been successful before the Tribunal, it could not rationally be said to be in the interests of justice to allow that success to be eroded by requiring that party to bear the costs of the representation which was reasonably necessary to achieve that outcome."

  1. [45]
    Tamawood Limited v Paans is not relevant here because, in that case, the remedy was an amount of money which, had costs not been awarded, would have reduced the value of the damages payable to the successful applicant substantially. In the case here the parties had to resolve the meaning of a written law and the value of the success for the Applicant is not eroded in the relevant sense through the incurring of costs.
  2. [46]
    Section 102(3)(f) of the QCAT Act invites the Tribunal to consider anything else the Tribunal considers relevant when considering costs. There is nothing relevant to the decision in this matter that has been raised by the parties or is otherwise evident to the Tribunal.

Conclusion

  1. [47]
    The starting point for the award of costs by QCAT is that each party to a proceeding must bear its own costs. This starting point can be displaced only where the interests of justice require it. The interests of justice do not require the starting point to be displaced in this case.

Decision

  1. [48]
    The Application is dismissed.

Footnotes

[1] Professional Engineers and Other Legislation Amendment Act 2014 (Qld) (‘PEOLA Act’) and the Queensland Building and Construction Commission and Other Legislation Amendment Act 2014 (Qld) (‘QBCCOLA Act’).

[2] GAR203-18.

[3] J.Mac Constructions Pty Ltd v Queensland Building and Construction Commission [2019] QCAT (unpublished).

[4] Ralacom Pty Ltd v Body Corporate for Paradise Island Apartments (No 2) [2010] QCAT 412, [29].

[5]Ascot v Nursing & Midwifery Board of Australia [2010] QCAT 364, [9].

[6]  The Applicant claims its total actual costs in the matter were approximately $117,000.

[7]  QCAT Act, s 102(3)(a)

[8]  Ibid, s 102(3)(b)

[9]  Applicant’s submissions dated 8 May 2019, par 24

[10]  QCAT Act, s 102(3)(c)

[11]  Ibid, s 102(3)(d)

[12]  Applicant’s submissions dated 8 May 2019, pars 27, 28

[13]  QCAT Act, s 102(3)(e).

[14]  Respondent’s Submissions on Costs, dated 15 May 2019.

[15]  Ibid [22].

[16]  Ibid [69].

[17]  Ibid [62]-[68].

[18] Ezra Constructions Pty Ltd & Ors v Queensland Building and Construction Commission & Ors [2019] QSC 47, [24].

[19] Tamawood Limited v Paans [2005] QCA 111.

[20]  Page 112.

Close

Editorial Notes

  • Published Case Name:

    J.Mac Constructions Pty. Ltd. v Queensland Building and Construction Commission

  • Shortened Case Name:

    J.Mac Constructions Pty. Ltd. v Queensland Building and Construction Commission

  • MNC:

    [2019] QCAT 249

  • Court:

    QCAT

  • Judge(s):

    Member Dr Collier

  • Date:

    23 Aug 2019

Appeal Status

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

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