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

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

CITATION:

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

PARTIES:

Andrew John Stuart

(Applicant/Appellant)

v

Queensland Building and Construction Commission

(Respondent)

APPLICATION NUMBER:

APL316-14

MATTER TYPE:

Appeals

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Senior Member O'Callaghan

Member Deane

DELIVERED ON:

22 September 2016

DELIVERED AT:

Brisbane

ORDERS MADE:

  1. The application for costs is dismissed.

CATCHWORDS:

APPEAL – COSTS – whether in the interests of justice to order costs – where wholly successful on appeal – whether Commission acted ‘ultra vires’ in collecting evidence, which was not in its possession at the time of its decision

Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 20, s 21, s 40(b), s 43, s 100, s 102, s 106, s 107

Queensland Building and Construction Commission Act 1991 (Qld), s 3, s 7, s 71, s 77

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

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

Tamawood Ltd & Anor v Paans [2005] 2 Qd R 101

Lyons v Dreamstarter Pty Ltd [2012] QCATA 71

Lyons v Dreamstarter Pty Ltd [2011] QCATA 142

R v Hardimann (1980) 144 CLR 13

Crime and Misconduct Commission v Deputy Commissioner Stewart and Anor (No 2) [2012] QCAT 382

Macedon Ranges Shire Council v Romsey Hotel Pty Ltd (2008) 19 VR 422

Kehl v Board of Engineers [2010] QCATA 58

Fuge v Queensland Building and Construction Commission [2014] QCAT 383

Queensland Building Services Authority  v Fox [2005] QDC129

AX v Commissioner for Children and Young People and Child Guardian [2012] QCATA 227

APPEARANCES:

APPLICANT:

Andrew John Stuart

RESPONDENT:

Queensland Building and Construction Commission

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

REPRESENTATIVES:

APPLICANT:

represented by B.E. Codd of Counsel instructed by Murdoch Lawyers

RESPONDENT:

represented by G.I. Thomson and K.McAulifffe-Lake of Counsel instructed by Holding Redlich

REASONS FOR DECISION

  1. [1]
    On 16 June 2015, we allowed Mr Stuart’s appeal.  On 10 December 2015, Mr Stuart filed a miscellaneous matters application seeking costs of the appeal and the review proceedings.[1]
  2. [2]
    The Tribunal may award costs after the proceeding has ended.[2]
  3. [3]
    Mr Stuart contends that the Appeal Tribunal:
    1. has jurisdiction to make appropriate awards in respect of both the review and appeal proceedings; and
    2. should fix the costs having regard to an assessment, on a standard basis in accordance with the District Court scale, by Mr Ryan, Legal Costs Assessor,[3] at $88,807.95 in respect of the review proceedings and $36,494.55 in respect of the appeal proceedings.[4]
  4. [4]
    The review proceedings and this appeal arise out of a decision by the Queensland Building and Construction Commission (the Commission), as it is now known, in relation to whether home owners, for whom Mr Stuart performed domestic building work, were entitled to succesfully claim under the statutory insurance scheme.  The decision sought to be reviewed was that the contract had been validly terminated upon the contractor’s default.[5]  Such a decision placed Mr Stuart at risk that the Commission would seek to recover from him amounts paid to the homeowners under the scheme.[6] 
  5. [5]
    Upon the hearing of the review proceedings, the learned Member found that the contract had been mutually abandoned.  He set aside the decision of 12 September 2012 and made consequential orders.  The consequential orders still placed Mr Stuart at risk that the Commission may seek to recover from him amounts paid to the homeowners under the scheme.  Mr Stuart successfully appealed the consequential orders. 
  6. [6]
    In allowing the appeal, we found that the scheme did not indemnify an insured for the loss suffered for non-completion by a contractor, as a result of a proper termination by the insured, when the mode of termination was by mutual abandonment.[7] 
  7. [7]
    We accept that Mr Stuart incurred significant expense in bringing the review proceedings and the appeal. 
  8. [8]
    The QCAT Act 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 proceedings.[8]  The starting point may be displaced, if the Tribunal considers it is in the interests of justice to do so.[9]
  9. [9]
    The then President, Justice Wilson in Ralacom Pty Ltd v Body Corporate for Paradise Island Apartments (No 2)[10] stated at [4]:

This presumption may, however, be displaced if the Tribunal considers it is in the interests of justice to order a party to pay all or part of the costs of another party: s 102(1).  The phrase “in the interests of justice” is not defined in the Act but is to be construed according to its ordinary and plain meaning, which obviously confers a broad discretionary power on the decision-maker.

  1. [10]
    Mr Stuart contends that it is in the interests of justice that the Commission pay his costs.
  2. [11]
    The then Deputy President, Judge Kingham in Ascot v Nursing & Midwifery Board of Australia[11] stated at [9]:

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.

  1. [12]
    Mr Stuart relies principally upon the principle in Tamawood Ltd & Anor v Paans.[12] The costs provision under consideration in that case was quite different to section 100 of the QCAT Act. 
  2. [13]
    The then President, Justice Wilson in Ralacom Pty Ltd v Body Corporate for Paradise Island Apartments (No 2)[13] considered the principle in Tamawood and stated at [26] – [27]

Keane JA was of the view that where the complexity of the matter justified legal representation, it would not be in the interests of justice to bar the successful party from recovering costs that were reasonably necessary to achieve a satisfactory outcome.

That conclusion must, here, be considered in the light of the difference between s 70 of the CCT Act and s 100 of the QCAT Act. Section 70 speaks of a ‘main purpose’, but s 100 mandates that parties shall bear their own costs.

  1. [14]
    Mr Stuart contends that the approach in Lyons v Dreamstarter Pty Ltd[14]sits more comfortably with the approach taken by Keane JA in Tamawood’[15]  where the then President, Justice Wilson stated at [11]:

The discretion to award costs starts with the proposition that it is just and reasonable that a party who causes another to incur costs should reimburse the other party for them.[16] Otherwise, the factors affecting the discretion will vary in each case.[17]

  1. [15]
    However, those comments were in relation to a domestic building dispute.  The Tribunal’s discretion to award costs in a building dispute[18] is a broader and more general discretion than the one conferred by the QCAT Act[19] because there is an express power to award costs conferred by the Queensland Building and Construction Commission Act 1991 (Qld)[20] (‘QBCC Act’), the relevant enabling Act.  Unlike in the QCAT Act, there is no strong contra-indication in section 77 of the QBCC Act against a costs order. 
  2. [16]
    Mr Stuart contends that it is necessary to determine the interests of justice ‘on a case by case basis and not by applying a gloss to the words of the Act such as to require the applicant make out a compelling case for costs as opposed to what the justice of the case demands’.[21]
  3. [17]
    We accept that it is necessary to consider the factors referred to in section 102(3) of the QCAT Act, to the extent they are relevant to a particular case, to determine if the interests of justice point to a costs award. 
  4. [18]
    Those considerations are largely in the nature of what may be regarded as ‘entitling’ or ‘disentitling’ factors.  In the exercise of the discretion to award costs, it is necessary to weigh relevant factors against the starting position that each party bear their own costs.  In view of the legislated shift in the starting position to that stated in section 100, the weight of such factors must be compelling for the starting position to be overcome.
  5. [19]
    We accept that it may be appropriate to consider costs in the review proceeding separately from costs in the appeal proceeding.  The particular factors affecting the exercise of the discretion to award costs may differ and may lead to different outcomes.
  6. [20]
    If an order is made, the Tribunal should fix the costs if possible.[22]

Whether a party acts in a way that unnecessarily disadvantages another party[23]

  1. [21]
    We are not satisfied that the Commission acted in a way which unnecessarily disadvantaged Mr Stuart in either the review proceedings or the appeal.
  2. [22]
    Mr Stuart contends that the Commission has not acted in accordance with the model litigant principle and takes issue with the way the Commission undertook its obligations to assist the Tribunal.[24]   The decision maker is to use their best endeavours to help the Tribunal make its decision. 
  3. [23]
    Mr Stuart contends that the Commission took on an adversarial role and in doing so is exposed to a costs order.  Specifically he contends that the Commission ought not to have advanced a positive case when the owners could have taken on that role.  Section 40(b) of the QCAT Act requires the Commission, as decision-maker, to be a party to the proceedings.  At a relatively early time in the proceedings, the Commission applied to join the owners.[25]  On 29 July 2013 that application was dismissed.
  4. [24]
    Mr Stuart also contends that the Commission acted ‘ultra vires’ in collecting evidence, which was not in its possession at the time of its decision and caused legal costs to be incurred by Mr Stuart.  He says that the Commission ought to have adopted a role described as the Hardiman principle.[26] 
  5. [25]
    The Tribunal has previously considered this principle in Crime and Misconduct Commission v Deputy Commissioner Stewart and Anor (No 2)[27]

The main purposes of the Hardiman principle would seem to be the avoidance of unnecessary duplication when there is already a contradictor, and avoidance of the spectacle of a decision-maker (in that case, a quasi- judicial officer) becoming a protagonist in his or her own cause.  However in some merits review jurisdictions it has been held that the presence of a contradictor does not preclude the decision-maker from playing an active role, or diminish the appropriateness or its doing so[28].   

……

It is therefore important that decision-makers, who are bound by s 21 of the QCAT Act to use their best endeavours to help the Tribunal to perform its review, should engage in the proceedings in any respect in which the submissions on behalf of the other parties may be perceived as not adequately covering the perspective of the decision-maker and of the Queensland Police Service on whose behalf they perform their role.

  1. [26]
    In this case, there was no other respondent.  The obligation to assist in section 21(1) of the QCAT Act is expressly not limited to the matters in section 21(2), being the provision of a written statement of reasons and any document or thing in the decision-maker’s possession.
  2. [27]
    We are not satisfied that the Commission acted ‘ultra vires’.
  3. [28]
    Mr Stuart also points out that a short time prior to the hearing, the Commission advised that it did not propose to rely upon affidavits sworn by two officers including the decision maker.  Mr Stuart’s solicitors had requested the officers be available for cross-examination apparently in pursuit of Mr Stuart’s contention of a denial of natural justice in arriving at the 12 September 2012 decision.
  4. [29]
    The purpose of review proceedings is to produce the correct and preferable decision.[29]  In review proceedings before the Tribunal it is not necessary to demonstrate errors such as denial of natural justice, as the Tribunal reconsiders the matter afresh[30] and there is no presumption that the decision maker’s decision is correct.[31]
  5. [30]
    The QCAT Practice Direction in relation to the conduct of review hearings[32] makes it clear that the decision maker is not to give evidence nor be cross- examined about why the decision was made.
  6. [31]
    The conduct by the Commission of the review hearing appears largely consistent with the practice direction.

The nature and complexity of the dispute[33]

  1. [32]
    We accept that this is a factor in favour of an award of costs in both the review proceedings and the appeal but it is not determinative.[34]
  2. [33]
    Mr Stuart places particular emphasis on this factor.  He contends that the proceeding involved complex legal issues, which warranted legal representation. 
  3. [34]
    He points to the direction[35] that granted both parties leave to be legally represented and contends that it is implicit in the direction that the granting of leave was considered in the interests of justice, as otherwise parties are to represent themselves.[36] He also points to this direction as evidence of the complexity.
  4. [35]
    Mr Stuart also points to written submissions dated 25 February 2014 in which he gave notice of an intention to seek costs.
  5. [36]
    We accept that such a direction coupled with the retaining of lawyers would alert each party to the possibility that a costs order may be sought. 
  6. [37]
    The granting of leave to be represented is a factor to be considered in exercising the discretion to award costs but it is well settled in the Tribunal that it is not determinative of whether costs will be awarded and that parties engage lawyers knowing that the starting position is that each party is to bear their own costs. 
  7. [38]
    It is not disputed, that the issues to be determined in the review and in the appeal involved complex legal issues and that the Tribunal and the ultimate outcome benefitted from the parties being legally represented. 

The relative strengths of the claims[37]

  1. [39]
    We are not satisfied that this is a factor in favour of an award of costs in either the review or the appeal proceeding.   
  2. [40]
    Mr Stuart was partially successful in the review proceedings, in that the decision of 12 September 2012 was set aside and was ultimately successful on appeal.  In this sense, Mr Stuart’s claims were stronger.  However, it is well settled in the Tribunal that the principle that costs follow the event is displaced by section 100 of the QCAT Act. 
  3. [41]
    The Commission’s position as to the consequences of mutual abandonment both at the review proceeding hearing and upon appeal relied upon the obiter comments of McGill DCJ in Queensland Building Services Authority  v Fox.[38]  The Learned Member followed McGill DCJ’s views in making the consequential orders.  This is not a matter where the Commission was unsuccessful at first instance on the mutual abandonment point such that it ought not to have persisted with it on appeal.
  4. [42]
    Whilst ultimately unsuccessful on appeal the position advanced was not so unreasonable that it ought not to have been advanced by a body charged with balancing duties to assist the Tribunal, protect consumers and administer a self – funding statutory insurance scheme.
  5. [43]
    In continuing to advance this position on appeal, the Commission facilitated a thorough consideration of the issue consistent with its obligation to assist the Tribunal[39] reach the correct and preferable decision. 

Whether the applicant was afforded natural justice by the decision-maker[40]

  1. [44]
    We find that this is not a factor in favour of an award of costs in the review proceedings or the appeal.
  2. [45]
    Mr Stuart claims a denial of natural justice prior to the 12 September 2012 decision.  He expressly relied upon a denial of natural justice in the Application to review a decision.[41]   This is factor that may be relevant to the exercise of the discretion for costs in the review proceeding. 
  3. [46]
    In our view, it is not sufficient to simply point to a denial of natural justice.  It is also necessary to demonstrate the consequence or prejudice, which this caused.  The prejudice in terms of the outcome is not clear to us. 
  4. [47]
    Mr Stuart takes issue[42] with the Learned Member’s reasons that he first raised termination by mutual abandonment at the final hearing of the review proceedings, which commenced on 25 February 2014.[43] 
  5. [48]
    Mr Stuart contends that the Commission was in possession of the same documents, upon which the Learned Member relied to reach the conclusion of mutual abandonment and therefore the same conclusion was open to the Commission.  The Learned Member, of course, had the benefit of Mr Stuart’s submissions, which assisted him to reach that conclusion.  It is clear that the grounds in Mr Stuart’s initiating application do not expressly rely upon mutual abandonment and its consequences and that the ultimately successful submissions were advanced at a much later time. 
  6. [49]
    We are not satisfied that had the Commission afforded Mr Stuart the additional opportunity to respond prior to making the 12 September 2012 decision contended for by Mr Stuart that the review proceedings could have been avoided nor the costs of the review necessarily significantly reduced.  Even if Mr Stuart had expressly raised the issue of mutual abandonment earlier than the first day of the hearing, then it is likely it would have been met with the same response from the Commission i.e. a reliance upon the obiter comments of McGill DCJ.  For the reasons set out earlier this was not a completely unreasonable course for the Commission to adopt.
  7. [50]
    Mr Stuart’s submissions on this point are substantively, that costs should follow the event i.e. the Commission made an incorrect decision, the decision was overturned and therefore it ought to pay Mr Stuart’s costs.  This principle has been displaced by section 100 of the QCAT Act.

Whether the applicant genuinely attempted to enable and help the decision-maker to make the decision on the merits[44] 

  1. [51]
    This is a factor that may be relevant to the exercise of the discretion for costs in the review proceeding. 
  2. [52]
    The Commission contends and Mr Stuart accepts that this is not a significant factor.

The financial circumstances of the parties[45]

  1. [53]
    We are not satisfied that this is a factor in favour of an award of costs in either the review or the appeal proceeding.   
  2. [54]
    Mr Stuart has given evidence of the significant legal expenses incurred by him in these proceedings, in excess of $130,000.  There is no specific evidence of the financial hardship pursuing the review and appeal proceedings have caused.  There is limited evidence that around the time of the 12 September 2012 decision his net tangible assets were $106,395, which is of a similar order as the costs incurred in these proceedings.  There is no evidence before us as to his current net tangible asset position.
  3. [55]
    The Commission is a statutory body funded from fees paid by licensees.  It has a number of statutory obligations including to achieve a reasonable balance between building contractors and building owners.[46] 
  4. [56]
    There is no specific evidence before the Tribunal of the Commission’s financial position.  We accept that the Commission may have a better net asset position than Mr Stuart but it does not have unlimited funds, has budgetary constraints and many demands on its resources.
  5. [57]
    The Appeal Tribunal has previously accepted that the relative financial position should not be ‘the sole determinant’[47] of a costs application. 
  6. [58]
    In view of the Commission’s statutory role the Tribunal has previously accepted that

it must not be reticent in discharging its obligations for fear of adverse costs orders against it if it is unsuccessful in responding to an application for review of its decisions unless it can be demonstrated, there is some specific conduct on the part of the Commission, that would ‘so compellingly’ overcome the strong contra-indication against costs orders in s 100 of the QCAT Act.[48]

  1. [59]
    We are not satisfied that any such specific conduct applies in either the review or the appeal proceeding. 

Anything else the Tribunal considers relevant[49]

  1. [60]
    A relevant factor is often whether a settlement offer was made and that the decision of the Tribunal is not more favourable to the other party than the offer.[50] There is evidence before the Appeal Tribunal, in the itemised accounts, that a settlement offer was made.[51]  There is no evidence before the Appeal Tribunal as to the terms of the offer.  This is not, therefore, a matter, which we are able to take into account.
  2. [61]
    Weighing all of the factors we are not satisfied that the interests of justice require that a costs order be made in either the review or the appeal proceedings.

Footnotes

[1]GAR327-13.

[2]QCAT Act s 106.

[3]Affidavit of Gregory Ryan filed 9 February 2016.  The assessment on this basis is for the professional costs of the solicitors.  Counsel’s fees are treated as outlays.

[4]Affidavit of Kymberley Grant Flehr filed 21 March 2016, paragraph 9.

[5]Letter dated 12 September 2012.

[6] Queensland Building and Construction Commission Act 1991(Qld) (QBCC Act), s 71

[7]Stuart v Queensland Building and Construction Commission [2015] QCATA 81 at [14].

[8]QCAT Act s 100.

[9] Ibid, s 102.

[10][2010] QCAT 412.

[11][2010] QCAT 364.

[12][2005] 2 Qd R 101.

[13][2010] QCAT 412.

[14][2012] QCATA 71.

[15]Applicant’s Outline in Reply dated 17 March 2016 at [10].

[16] Latoudis v Casey [1990] HCA 59.

[17] Donald Campbell & Co v Pollak (1927) AC 732 at 811-12.

[18]QBCC Act s 77(3)(h); Lyons v Dreamstarter Pty Ltd [2011] QCATA 142.

[19]QCAT Act ss 100, 102.

[20]QBCC Act s 77.

[21]Applicant’s Outline in Reply dated 17 March 2016 at [11].

[22]QCAT Act s 107.

[23]Ibid, s 102(3)(a).

[24] Ibid, s 21.

[25]Application for miscellaneous matters dated 1 May 2013.

[26] R v Hardimann (1980) 144 CLR 13.

[27][2012] QCAT 382 at [13] and [15]

[28] Macedon Ranges Shire Council v Romsey Hotel Pty Ltd (2008) 19 VR 422.

[29]QCAT Act s 20(1).

[30]Ibid, s 20(2).

[31] Kehl v Board of Engineers [2010] QCATA 58.

[32]Practice Direction No 3 of 2013.

[33]QCAT Act s 102(3)(b).

[34]Fuge v Queensland Building and Construction Commission [2014] QCAT 383 at [21].

[35]GAR327-12 Direction by Member Gardiner dated 23 October 2012.

[36]QCAT Act s 43(1).

[37] Ibid, s 102(3)(c).

[38][2005] QDC 129.

[39]QCAT Act s 21.

[40] Ibid, s 102(3)(d)(i).

[41]Filed 9 October 2012.

[42]Applicant’s Outline in Reply dated 17 March 2016 at [34].

[43] Stuart v Queensland Building and Construction Commission [2014] QCAT 312 at [22].

[44]QCAT Act s 102(3)(d)(ii).

[45] Ibid, s 102(3)(e).

[46]QBCC Act s 3 and s 7.

[47] AX v Commissioner for Children and Young People and Child Guardian [2012] QCATA 227 at [16].

[48]Fuge v Queensland Building and Construction Commission [2014] QCAT 383 at [28].

[49] QCAT Act s 102(3)(e).

[50] Queensland Civil and Administrative Tribunal Rules 2009 (Qld) s 86.

[51]Exhibit KGF2 to the affidavit of Kymberley Grant Flehr filed 10 December 2015.

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Editorial Notes

  • Published Case Name:

    Stuart v Queensland Building and Construction Commission

  • Shortened Case Name:

    Stuart v Queensland Building and Construction Commission

  • MNC:

    [2016] QCATA 135

  • Court:

    QCATA

  • Judge(s):

    Senior Member O'Callaghan, Member Deane

  • Date:

    22 Sep 2016

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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