Carrington Homes Pty Ltd v Harrold
[2009] QDC 146
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- Unreported Judgment
- Carrington Homes Pty Ltd v Harrold[2009] QDC 146
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Carrington Homes Pty Ltd v Harrold[2009] QDC 146
Carrington Homes Pty Ltd v Harrold[2009] QDC 146
DISTRICT COURT OF QUEENSLAND
CITATION: | Carrington Homes Pty Ltd T/A Dixon Homes Cairns v Harrold & another [2009] QDC 146 |
PARTIES: | CARRINGTON HOMES PTY LTD T/A DIXON HOMES CAIRNS (Appellant) v HARROLD & ANOTHER (Respondent) |
FILE NO/S: | 1788 of 2008 |
DIVISION: | Civil |
PROCEEDING: | Appeal |
ORIGINATING COURT: | Brisbane District Court |
DELIVERED ON: | 29 April 2009 |
DELIVERED AT: | Brisbane District Court |
HEARING DATE: | 22 April 2009 |
JUDGE: | M W Forde DCJ |
ORDER: |
|
CATCHWORDS: | LEAVE TO APPEAL – meaning of “decision” – final or interlocutory order – error of law – limited role of appellate court on factual findings – application to strike out vexatious or oppressive claim – discretion to award costs Commercial and Consumer Tribunal Act 2003 ss 34, 50, 58, 60, 71, 100, 126, 128, Schedule 2. Queensland Building Tribunal Act 2000 ss 70, 77, 83, 86, 92. Acts Interpretation Act 1954 s 14A , 14B. Adam P. Brown Male Fashions Proprietary Limited v Phillip Morris Incorporated and Anor. [1981] 148 CLR 170 - applied Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321- applied Cassatone Nominees Pty Ltd v Queenslandwide House & Building Reports Pty Ltd (2008) QCA 102 – referred to Clements v Flower [2005] QDC 50 – referred to Freedom Homes Pty L td v Botros [1999] QCA 150 – applied Greg Kern & Co Pty Ltd Atf the Tiffany Trust v Building and Civil Contractors Pty Ltd [2007] QDC 059 – followed. Hall v Nominal Defendant (1966) 117 CLR 423 at 440 - applied International Entertainment (Aust) Pty Ltd v Churchill [2003] QSC 247 – referred to In re Page [1910] 1 Ch 489 – referred to. In Re the Will of FB Gilbert (1946) 46 SR NSW 318 – referred to. McDonald v Douglas Shire Council [2002] QCA 387 – referred to Mudie v Gainriver Pty Ltd(No 2) [2002] QCA 546 - applied Oceanic Sun Line Special shipping Company Inc v Fay (1988) 165 CLR 197 – applied Olivant v Wright (1875) 45 LJ Ch 1 – referred to Pingel v R & R Leach Pty Ltd and Ors [2002] QDC 030 - distinguished Port of Melbourne Authority v Anshun Pty Ltd (No 2) (1980-1981) 147 CLR 589 – referred to. Queensland Pork Pty Ltd v Lott [2003] QCA 271 – referred to. Re The News Corporation Ltd and others (1987) 70 ALR 419 – referred to. Risefer v Permanent Trustee Company Ltd (2005) 1 Qd R 681 - followed Saitta Pty Ltd v Commonwealth (No 2) [2003] VSC 346 – referred to. Tamawood Limited v Paans (2005) 2 Qd R 101 - applied Tampion v Anderson and Just (No 2) [1973] VR 829 – followed. The “Atlantic Star” (1974) AC 436 – referred to Vodopevic and Nor v Knigge [2003] QDC 304 – referred to Voth v Manildra Flour Mills Pty Ltd. (1990) 171 CLR 538 – referred to. Whywait Pty Ltd v Davison [1997] 1 Qd R 225 – referred to. Williams v Spautz (1991-1992) 171 CLR 509 at 526-527 – applied. |
COUNSEL: | Appellant: R. Wensley QC with him S. Moody Respondent: L. Alford |
SOLICITORS: | Appellant: B. Goodwin Solicitor Respondent: Christopher E. Taylor The Construction Lawyer. |
Introduction
- [1]On or about 12 April 2006, the appellant, a licensed building contractor, entered into a contract with the respondent to build a house at Redlynch in the State of Queensland. Disputes arose between the parties and the respondent purported to terminate the contract in writing on 11 April 2008. On 11 April 2008, the appellant filed an application in a Domestic Building Dispute in the Commercial and Consumer Tribunal (the “Tribunal”) claiming the sum of $60,000.00 owing to it under the contract.[1] On a date unknown the respondent filed a claim with the Queensland Building Services Authority (“QBSA”) seeking to be indemnified under the statutory insurance scheme.[2]
- [2]On 2 May 2008, the respondent filed an application seeking the summary dismissal of the appellant’s application pursuant to ss 58, 60 or 126 of the Commercial and Consumer Tribunal Act 2003 (the “CCT” Act). Subsequently, the appellant filed an amended Application which contained the statement of claim on 26 May 2008.[3] There was a consent order to amend and so leave was given to amend the application pursuant to s 34 of the CCT Act on 29 May 2008.[4] On the same occasion the application of the respondent to dismiss the appellant’s claim was heard. The Tribunal member dismissed the appellant’s claim pursuant to s 58(a) of the CCT Act by finding that the proceedings had been brought vexatiously or oppressively and ordered costs against the appellant.[5]
- [3]The appellant seeks leave to appeal against that decision pursuant to s 100 of the CCT Act to the District Court. For leave to be granted, it must be shown that there is an error of law or an excess, or want, of jurisdiction.
Leave to appeal
- [4]The respondent submits that it was not seeking a decision from the Tribunal based on the merits of the appellant’s claim but a dismissal of the proceedings themselves based upon ss 58(a), 60(1)(c) or 126(2)(b). The Tribunal member pointed out that there had been no affidavit filed pursuant to s 128(4) of the CCT Act and so reliance upon s 126(2) was not pursued. It is pointed out in the respondent’s submissions that the attack on the decision of the Tribunal was made solely under s 58(a) of the CCT Act.[6] It is therefore unnecessary to decide if the affidavit filed by the respondent complied with s 128(4) for the purposes of a summary dismissal of the claim.[7]
- [5]The respondent opposes the granting of leave on the basis that the order of the Tribunal was of an interlocutory nature and not a final order. Reliance was placed upon the decision of his honour Judge McGill in Pingel v R & R Leach Pty Ltd and Ors. [8] That case concerned s 92(1) of the Queensland Building Tribunal Act 2000 and stated that “a party to a proceeding before the Tribunal may appeal to the District Court against a decision of the Tribunal that finally decides matters the subject of the proceeding.” This Act was the precursor of the CCT Act. Section 100 of the CCT Act has no such limitation. The respondent contends that the order dismissing the appellant’s claim by the Tribunal was of a procedural or interlocutory nature and not final a decision, and that leave ought not be granted.
- [6]The appellant in its written submissions[9] refers to the definition of “decision” in Schedule 2 of the CCT Act. It includes order and direction. An order was made dismissing the appellant’s claim. It does not distinguish an interlocutory or final order. It is illustrative to refer to the previous legislation[10] and the definition of “decision” in the schedule in deciding whether an order of an interlocutory nature, for example, is a decision for the purposes of s 100. The subtle change in the legislation from “a decision that finally decides the matters” to “an order or direction” has some significance.
- [7]Even if a final order was required, the appellant points out that the decision to dismiss the appellant’s proceedings pursuant to s 58(a) of the CCT Act was a final order based upon the vexatious or oppressive nature of the proceedings. It finally determined the rights of the parties on that issue. Reference was made to Hall v Nominal Defendant[11]. However, Taylor J referred to the case of In re Page[12] as authority for the view that an order dismissing an action as frivolous and vexatious was an interlocutory order. It assumes that there was a right to bring another claim. That is the case here. The appellant can proceed to make a claim for monies owing notwithstanding the dismissal of the application as amended.[13] The order by the Tribunal dismissing the claim made by the appellant is “an order other than a final judgment or decree in an action”[14] One of the grounds for finding the appellant’s proceedings to be vexatious was the absence of a sworn affidavit as to the particulars of the claim or that it was an attempt to prevent recovery under the statutory insurance scheme.[15] Even if the order made by the Tribunal was not “final” in the sense discussed in the authorities, the definition in Schedule 2 does not limit the nature of the decision to be appealed under s 100 of the CCT Act. However, the Explanatory Notes[16] provide:
Clause 100 provides that appeals from decisions of the Tribunal may be made to the District Court and only by leave of the District Court and only on a question of law. Appealable decisions under this provision do not include interlocutory or procedural orders or directions, but only final decisions in proceedings. This provision narrows the scope of appealable decisions in order to give the Tribunal more certainty about its decision making.
- [8]Extrinsic material may be used to interpret an Act if it is ambiguous or obscure.[17] An explanatory note falls within that category.[18] Unfortunately, the Explanatory Notes complicate the present question as the definition in the Schedule did not reflect the observations also by the Minister in the Second Reading Speech. It seems that a “decision” can include a “direction”. The latter does not have the same importance as say an order, whether it be final or interlocutory. Mr Wensley QC is content to rely on the definition of “decision” as provided for in the Schedule of the CCT Act as being inclusive of both final and interlocutory orders. The definition of “decision” did not adhere to the Minister’s views expressed before the Bill became law. Therefore, it seems that the Schedule to the Act broadened the types of decisions which were appealable. As was pointed out in the appellant’s submissions[19], the question as to whether an order is final or interlocutory is ordinarily relevant to the question as to whether leave to appeal is required.[20] It does not define the grounds for leave to appeal such as is provided for in s 100 of the CCT Act viz error of law. Therefore, in the present case, notwithstanding that the order made could be described as interlocutory in nature, the appellant argues it is entitled to challenge that decision under s 100 of the CCT Act. As pointed out by his honour Judge McGill in Vodopevic and Anor v Knigge[21]:
It is difficult to imagine what, if anything, the legislature had in mind when imposing the requirement for leave in the 2003 Act: it is difficult to conceive of any circumstances where any appeal on the ground of excess or want of jurisdiction would not justify leave…
One would also think that it would be unusual to find a situation where the District Court would refuse leave to appeal against a decision of the tribunal which was infected with some error of law.
- [9]The respondent argues that the decision made is one of practice or procedure, and that an appeal court should exercise particular caution in reviewing matters of that nature.[22] It is unhelpful to categorise even an interlocutory order as one of practice or procedure. The CCT Act specifically defines decision. If there is an error of law established in relation to a decision, leave can be granted to appeal. Cases relied upon by the respondent relying on orders relating to practice or procedure can be distinguished from the present case. The arguments of the respondent on this point are rejected.[23]
Supplementary Submissions of Parties
- [10]Having heard argument, the parties were invited to present further written submissions.[24] Reference is made by the appellant to s 50 of the CCT Act which provides as follows:
50 Directions and Orders
(1) The Tribunal may make orders, give directions and do whatever is necessary for the just, fair, informal, cost efficient and speedy resolution of a proceeding.
(2) The power to give directions under subsection (1) is subject to practice directions under section 49.
(3) Without limiting subsection (1), the Tribunal may at any time –
(a) set time limits for the completion of anything to be done in relation to the proceeding; and
(b) require a party to the proceeding to give the tribunal either or both of the following if the Tribunal considers it may be relevant to the proceeding –
(i) a document in the party’s possession or control;
(ii) any other information or evidence.
- (4)A party must comply with an order or direction within the time stated in the order or direction unless the party applies to the tribunal for and is granted an extension of time to comply with the order or direction.
- (5)The Tribunal, on application of a party or on its own initiative, may at any time vary or revoke an order or direction given by it.
- (6)The Tribunal may not vary or revoke an order or direction given by it if to do so would cause any prejudice or detriment to a party or potential party that can not be remedied by an appropriate order for costs or damages.
- (7)In this section –
order includes an interim order.
- [11]The appellant rejects the proposition of the respondent’s counsel that an appeal against an interlocutory decision cannot be made. Examples were given including s 118(3) of the District Court Act (Qld) which provides for leave to be obtained before the appeal can be heard from the District Court if the requirements of s 118(2) are not met. This can include interlocutory orders.[25] It is accepted in the submissions of the appellant that the granting of leave to appeal on an interlocutory decision will ordinarily require caution to be exercised so as not to encourage appeals from interlocutory orders.[26] Their honours referred to the passage in In re the Will of F B Gilbert[27]:
…I am of the opinion that, …there is a material difference between an exercise of discretion on a point of practice or procedure and an exercise of discretion which determines substantive rights. In the former class of case, if a tight rein were not kept upon interference with the orders of Judges of first instance, the result would be disastrous to the proper administration of justice. The disposal of cases could be delayed interminably, and costs heaped up indefinitely, if a litigant with a long purse or a litigious disposition could, at will, in effect transfer all exercises of discretion in interlocutory applications from a Judge in Chambers to a Court of Appeal.
- [12]That passage is relied upon by the present respondent. A further submission was made:[28]
The Respondent submitted during the hearing on the question of Leave to Appeal, that it would be a nonsense if every direction or order of the Tribunal was appellable, noting that directions include directions as to the provision of, inter alia, statements of evidence and expert reports. Thus the definition of ‘decision’ in the Act must be read in the context of what was intended by the Parliament in enacting the legislation, and narrowly in light of the common law acceptance that interlocutory decisions are not applellable. The meaning of decision to the extent it is read in conjunction with s 100 of the Act can only mean final decisions. Such a submission is in line with what was clearly the intention of parliament in enacting the legislation.
That submission is at the heart of the respondent’s case as to why the appellant’s leave to appeal in the present case should be refused. Some weight is also attached to the Second Reading Speech:[29]
The Bill establishes that appeals of decisions of the CCT may be made to the District Court only on a question of law and then only with leave of the court. This narrows the current appeal rights for some jurisdictions. However, I believe it is essential that parties should be given some certainty about CCT’s outcomes, which can be achieved by restricting appeals (sic) to questions of law.
Reliance was also placed upon the objects of the CCT Act by establishing a system of dispute resolution that is just and fair and gives litigants “equal opportunity, regardless of their resources, to assert or defend their legal rights” and have a “range of procedures available and minimises costs to the extent practicable”[30]. To allow appeals on directions or interlocutory applications as is sought in the present case would, it is submitted by contrary to the Act and the usual approach of appeal courts. The respondent further submits that the Acts Interpretation Act 1954 (Qld) requires an interpretation that “achieves the purpose of the Act” [31] The same Act of course refers to the use of extrinsic material in interpretation of acts.[32]
- [13]The respondent submits that to adopt the interpretation urged by the appellant of s 100 would mean that “every order and direction made by the Tribunal” could be the subject of an appeal[33]. When one looks at the types of directions which have been referred to in s 50 of the CCT Act, to allow a right to appeal in all such cases if there is an error of law may not fit comfortably with the purpose of the CCT Act. It may be difficult to establish an error of law in a directions decision in any event. A party would be discouraged from making frivolous applications. This would be more so when one looks at s 47 of the CCT Act which provides that proceedings are at the discretion of the tribunal. An extension of time in which to file a document may be a direction in a proceedings or a decision of an interlocutory nature. To prove a error of law may be difficult. However, the CCT Act provides that threshold before leave to appeal can be obtained. If it is merely a challenge to the exercise of a discretion, it would be difficult to overturn:[34]
It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration , then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so.
- [14]It seems, however, that there is authority to the contrary to the propositions put by the respondent. His honour Judge Brabazon QC has held[35] that notwithstanding the Explanatory Notes accompanying the Bill (referred to above) that the restricted intention was not carried through to the Act. In other words, once there is an error of law established as reflected in the decision, leave would be granted to appeal against orders or directions. In that case, even though the order in relation to security for costs was not a final decision, the appellant could obtain leave if there was an error of law. His honour then went on to consider that question.
- [15]The respondent has presented some forceful arguments as to why leave should not be given to appeal an interlocutory order made by the Tribunal. When one looks at the cases a court is required to take a cautious approach to allowing such appeals. A party aggrieved, in order to succeed and obtain leave under s 100 of the CCT Act, would have to show an error of law. This would be difficult to show in most cases where directions had been given under s 50 of the CCT Act. Perhaps the legislature had that in mind in deciding the definition of “decision” in the Schedule to the CCT Act. By so doing it has avoided the problems associated with deciding whether an order was a final or interlocutory order for the purposes of obtaining leave.[36] If the legislature intended to limit appeals to decisions of a “final” nature, then it ought to be reflected in the definition of “decision” in the Schedule. It was certainly limited in the former legislation.[37]
Error of Law
- [16]It is submitted by both parties that leave to appeal ought to be granted if there is “a reasonable prospect of demonstrating an error of law on the part of the learned member who constituted the CCT, and that it could have materially affected the decision”[38]
- [17]There are some 10 or so grounds of appeal. It is only necessary to deal with two of those grounds as there is some overlapping and a decision on two grounds will be sufficient for present purposes:
- proceeding on the basis that the Appellant (the respondent before him) was obliged to place sworn evidence before the Tribunal (including the building contract between the parties; evidence going to and explaining amendments to the Appellant’s pleading and the reasons for them; and evidence substantiating the Appellant’s amended pleading) when, as a matter of law, the Member was obliged to proceed on the basis that the Appellant could establish at trial all of the matters pleaded by it;
- [18]In the amended statement of claim, the appellant increased the quantum from $60,000.00 to $138,700.00 without providing an explanation for the increase. The Tribunal member expressed the view that one “would normally expect an explanation in support of an application for leave to amend or at least, in defence of the application by a respondent for a summary decision.” As pointed out by the respondent’s counsel, the relevant form for applications in the CCT requires a statement in affidavit form explaining the reasons.[39] However, in this case the amendment was by consent. The respondent has submitted[40] that even though the respondent may have technically consented to the order, that it was the background to the amendment that required an explanation in order to avoid an adverse finding by the Tribunal. In practice, in such cases no material by way of affidavit is usually given by either side. The amended statement of claim sets out more clearly the cause of action.[41] It was not suggested there was no cause of action.[42] The Tribunal member was critical that no particulars were provided of the claim. None were sought at that stage. Contrary to what is submitted by the respondent, the lateness of the amendment does not prove vexation. It may be a factor depending on the facts.
- [19]Absent an explanation for the amendments, the Tribunal member went on to find that the appellant had no proper basis for the claims made in the original application filed on 11 April. He stated further:
This, together with the builder’s failure to explain or depose to the basis for the complete revision of its claim, reflects adversely on the genuineness of the claims advanced by the builder in the amended application.[43]
- [20]The finding did not reflect the factual matrix. Even if the original claim lodged was not genuine, it had been amended prior to the application to dismiss the claim on the grounds that it was vexatious.[44] The respondent had accepted that there were disputed questions of fact and law on the face of the amended statement of claim.[45] A perusal of the amended statement of claim shows a properly pleaded case. It was not necessary at that stage to swear to the case pleaded.[46] It was not a summary application to dismiss the case on the grounds that there was no cause of action or that that there was a defence on the merits.[47] The onus was on the respondent to show that the appellant had commenced proceedings in the Tribunal vexatiously or oppressively.[48] The evidentiary onus did not shift to the appellant. The lateness of the amendment was not determinative of that issue. It was a consent order. The lateness of an amendement was perhaps explained by the nature of the application by the respondent. Pleadings are often amended to avoid a striking out application. It does not follow that they are vexatious. The finding that there was a failure to prove the claim by affidavit placed the onus on the appellant not the respondent. It was a reversal of the onus of proof. This was an error of law.
- [21]The respondent contends that the role of an appellate court is limited:
In any event, in an application for leave to appeal under s 94(1), or, on an appeal like this from a decision refusing such leave, the function of the Appellant Court is limited in the manner described in Whywait Pty Ltd v Davison[49]. It is not open to this Court to make findings of primary fact or to draw inferences that are inconsistent with those that were arrived at by the Tribunal Member unless there was no reasonable evidence on which such a finding or inference could have been arrived at. That is not the case here.[50]
- [22]That principle can also be found in Australian Broadcasting Tribunal v Bond[51]:
Thus, at common law, according to the Australian Authorities, want of logic is not synonymous with error of law. So long as there is some basis for an inference – in other words, the particular inference is reasonable open, even if that inference appears to have been drawn as a result of illogical reasoning, there is no place for judicial review because no error of law has taken place.[52]
- [23]In the present case there was no reasonable evidence to support the inference that the appellant had acted vexatiously or oppressively. There was a genuine dispute both on the facts and at law. The nature of the CCT Act and the QBSA Act envisaged applications before the Authority and also in the Tribunal.[53] There was some correspondence between the parties which was described by the appellant as “robust”[54] In its letter of 8 April 2008, the Corporate Counsel for the appellant indicated to the respondent’s solicitor that his client was going to take the matter to the Tribunal as the respondent had frustrated the contract and that damages would be sought. That letter was received on 10 April 2008. There is nothing remarkable in that. In fact, it has not been proved when the application was lodged by the respondent under the QBSA Act. The appellant was entitled to protect its position. What has occurred is that the respondent obtained a finding in its favour before the Authority and the appellant has appealed the finding that the respondent was not at fault in terminating the contract. That fact by itself is not relevant to this determination. What is relevant is that the appellant was entitled to protect its position under the contract by commencing proceedings in the Tribunal and seeking payment of the monies owed to it for any breach. An adverse finding by the Authority as to who breached the contract may have amounted to an issue estoppel as both the appellant and the respondent were parties.[55] In a fax sent on 8 April 2008, the solicitor for the respondent indicated that it was going to refer the matter to the QBSA and make a claim under the statutory insurance scheme. The right to insurance was dependent upon a finding by an administrative officer that the respondent was not at fault in terminating the contract. Each party was asserting what they believed to be their rights. A pre-emptive step as part of the litigious process does not in most cases amount to a vexatious or oppressive action.
- [24]The other ground in the Notice of Appeal to be discussed is:
- (e)attributing knowledge to the Appellant (which knowledge was essential to the Member’s reasoning process and conclusion that the proceedings were brought for the sole purpose of “stopping the homeowners’ claim under the statutory insurance scheme[56] and as part of a course of conduct intended to vex and intimidate the homeowners”.) When there was no evidence that could have grounded such an attribution;
If one of the consequences of making a claim in the Tribunal was to thwart the respondent’s application before the Authority, that is not fatal to the appellant if there was some other justifiable purpose viz bringing a claim and seeking to obtain relief. The existence of an ulterior motive is irrelevant:[57]
And the existence of the ultimate purpose cannot constitute an abuse of process when that purpose is to bring about a result for which the law provides in the event that the proceedings terminate in the prosecutor’s favour.It is otherwise when the purpose of bringing the proceedings is not to prosecute them to a conclusion but to use them as a means of obtaining some advantage for which they are not designed or some collateral advantage beyond what the law offers.[58]
- [25]Under the CCT, the appellant was allowed to seek monies owing.[59] In fact, s 77 of the QBSA Act gave the Tribunal power to decide building disputes and s 83 gave the Tribunal the right to manage the dispute. Section 70 of the same Act allowed the respondent to seek indemnity under the insurance scheme by applying to the Authority in accordance with the regulations. The decision to give insurance cover is an administrative one. The appellant, as the builder, can appeal to the Tribunal from the decision of the Authority.[60] It has done so in this case. A party is entitled to argue its case and to seek a determination of the relevant tribunal of its claim.[61]
- [26]It is illustrative, at this point to consider the findings of the Tribunal member to place the case in some perspective:
[51] The builder, experienced in the statutory regulation of domestic building contracts and advised by its corporate counsel, plainly knew that there were many “avenues open” to it. It knew that it could attempt to reach an agreement with the home owners as an alternative to disputation. It knew that it could make its own submissions to the QBSA concerning the home owners’ claim under the statutory insurance scheme. It knew that it could await the decision of the QBSA and, if it disagreed with that decision, it could apply to have the decision reviewed by the tribunal.
[52] The builder also knew that bringing a domestic building application in the tribunal would have a direct effect on the ability of the home owners to progress a claim through the statutory insurance scheme. I infer as much from the second letter from the builder’s corporate counsel (dated 11 April 2008) and the relief originally sought in the application filed on that date.
[53] In the written submissions filed after the hearing, the builder conceded its knowledge that QBSA “has a view of the matter that results in it generally continuing with the non-completion claim” even when its decision is the subject of a review in the tribunal. In those written submissions, the builder agreed that it would otherwise have to seek a stay or injunction against the QBSA to stop the statutory insurance scheme…it follows the builder knew that only by filing a domestic building application could it arrest the progress of the home owners’ insurance claim.
In fact what has happened is that the Authority continued with assessing the insurance claim and granted it. That is the decision presently under review by the Tribunal. As was submitted to the Tribunal member, the Authority would continue to process the claim for insurance notwithstanding there may be review proceedings on foot before the Tribunal relating to the decision to grant insurance.
[63] In all the circumstances, on the evidence before the tribunal, I am satisfied that the builder brought the domestic building application for the purpose of stopping the homeowners’ claim under the statutory insurance scheme and as part of a course of conduct intended to vex and intimidate the home owners.
[68] If there was any proper basis for the builder’s claim, as now articulated in the amended application, it would have been a reasonably simple matter for the builder to depose to the relevant material facts so as to set up that claim.
[70] I am also satisfied, as noted above, that the builder instituted the proceeding merely to vex the home owners and has maintained it for that purpose.
- [27]Counsel for the appellant drew the attention of the court to the difference between s 58(a) and s 60(1)(c) of the CCT Act. The former relates to vexatiously bringing a claim and the latter to conducting the claim vexatiously and which results in unreasonably disadvantaging another party. For present purposes, s 58(a) is relevant. It is inherent in the reasoning of the Tribunal member that the failure to particularise and depose by way of affidavit the basis of the claim amounted to an intention to vex and intimidate the respondent as their claim for insurance would be thwarted. In fact, that has not happened. At the time of the hearing of the appeal, and the original application the appellant accepted that the Authority would continue to process the claim for insurance. The respondent did not contend otherwise. As was submitted by the appellant[62], even if the appellant were successful in appealing the decision of the Authority on the termination of contract point, it would still have to pursue its claim in the Tribunal for damages.
- [28]The Tribunal member has made an error of law in determining that because there was an improper motive that the proceedings were brought vexatiously. That finding ignored the statutory provisions and the prima facie justifiable claims of the appellant. The amended statement of claim did not on its fact lack efficacy. It established a cause of action open to the appellant to pursue at any point. The appellant was not required to desist from making any claim to the Tribunal because the Authority was administratively considering a claim for statutory insurance. The Authority pressed on with that claim and made a determination.[63] It was envisaged at the hearing before the Tribunal that it would do so. It should also be remembered that at the time that the appellant filed its claim, there was no evidence to establish that in fact the respondent had filed its claim with QBSA.[64]
- [29]
‘Oppressive’ is an adjective which ought to be, and today normally is, confined to deliberate acts of moral, though not necessarily legal, delinquency, such as an unfair abuse of power by the stronger party in order that a weaker party may be put in difficulties in obtaining his just rights. ‘Vexatious’ today has overtones of irresponsible pursuit of litigation by someone who either knows he has no proper cause of action, or is mentally incapable of forming a rational opinion on that topic.
- [30]The case of Fay was concerned with what was the most appropriate forum for the action to be heard. As was remarked by Brennan J[67]:
Unless a defendant is able to show oppression, vexation or other abuse of process, the first condition is unsatisfied and a stay is refused. A defendant does not have to discharge the burden of proof merely by showing that the balance of convenience favours litigation in some other forum. The policy of the law is to allow “any plaintiff bona fide seeking relief to have unrestricted access to the seat of judgment” [68] and that is a policy which prevails unless oppression, vexation or other abuse of process is shown.The grounds on which the court is justified in refusing to exercise its jurisdiction when it is regularly invoked are, and in my opinion, should be, grave and narrowly confined.
- [31]
[36] Unquestionably, something much more than lack of success needs to be shown before a party’s proceedings are frivolous or vexatious. Although in a different context, some assistance can be gained from the discussion of the meaning of these words in Oceanic Sun Line Special Shipping Company v Fay[71] where Deane J states that “oppressive” means seriously and unfairly burdensome, prejudicial or damaging and “vexatious” means productive of serious and unjustified trouble and harassment, meanings apparently approved by Mason CJ, Deane and Gaudron JJ in Voth v Manildra Flour Mills Pty Ltd.[72] Those meanings are apposite here.
[37] Whether proceedings are vexatious or oppressive will turn on the circumstances of the case and will include public policy considerations and the interests of justice.
- [32]In the present case, the appellant was entitled to bring its claim in the Tribunal. The respondent was entitled to bring a claim before the Authority. It is not a case of vexation or oppression. There was jurisdiction in the Tribunal to hear the case. A valid cause of action was pleaded. It was not necessary to decide if at the end of the day the appellant could prove each element of the cause of action. The QBSA and the Tribunal were dealing with different issues. The legislature gave the power to the Tribunal to manage the proceedings.[73] It is not to the point that there may be established some ulterior motive.
- [33]The inferences drawn by the Tribunal member as referred to above[74] were not reasonable in the circumstances. In that event an error of law has occurred. Such an error has materially affected the outcome of the case. In view of the findings on the main grounds of appeal, it is unnecessary to deal with all grounds of appeal.
Costs
- [34]The relevant provisions of the CCT Act in relation to costs are as follows:
70 Purposes of div 7
The main purpose of this division is to have parties pay their own costs unless the interests of justice require otherwise.
71 Costs
(1) In a proceeding, the tribunal may award the costs it considers appropriate on—
(a) the application of a party to the proceeding; or
(b) its own initiative.
(4) In deciding whether to award costs, and the amount of the costs, the tribunal may have regard to the following—
(a) the outcome of the proceeding;
(b) the conduct of the parties to the proceeding before and during the proceeding;
(c) the nature and complexity of the proceeding;
(d) the relative strengths of the claims made by each of the parties to the proceeding;
(e) any contravention of an Act by a party to the proceeding;
(f) for a proceeding to which a State agency is a party, whether the other party to the proceeding was afforded natural justice by the State agency;
(g) anything else the tribunal considers relevant.
Examples of paragraph (g)—
The tribunal may consider whether a party to a proceeding is acting in a way that unreasonably disadvantages another party to the proceeding.
The tribunal may consider whether the proceeding, or a part of the proceeding, has been frivolous or vexatious.
(5) A party to a proceeding is not entitled to costs merely because—
(a) the party was the beneficiary of an order of the tribunal; or
(b) the party was legally represented at the proceeding. 100 Appeals
(1) A party to a proceeding before the tribunal may appeal to the District Court against a decision of the tribunal, with the court’s leave, only on the ground of—
(a) error of law; or
(b) excess, or want, of jurisdiction.
(3) An appeal must be filed within 28 days after the decision takes effect.
(4) An appeal must—
(a) be accompanied by the tribunal’s decision and reasons for decision, if any; and
(b) refer to the tribunal’s decision and reasons for decision, if any, and any other relevant material and state the grounds for the application.
(8) The appellant must pay the costs of the appeal, including the costs of any transcript.
- [35]It has been held in Tamawood Limited v Paans [75]:
(1)That ss 70 and 71 imposed a general rule that good reason was to be shown in terms of the interests of justice for making an award of costs in proceedings before the Tribunal.
(2)That a finding, that a successful party reasonably obtained legal representation because of the complexity of the case, could be a sufficient basis for an award of costs by the Tribunal in that party’s favour, at least in the absence of any countervailing consideration.
(3)That s 100(8) referred to the costs involved in the formal process required to initiate the appeal, as distinct from the legal costs of representation. Accordingly on such an appeal the District Court retained its discretion under the Uniform Civil Procedure Rules 1999 (UCPR) to award costs other than those referred to in s 100(8).
Therefore, the appellant is required to pay the costs of the appeal in relation to the formal process including the transcript as required under s 100(8). Both parties agreed to the legal representation. The appellant was represented by its in house lawyer who then briefed counsel on the appeal. It cannot be said, therefore, that the obtaining of legal representation due to the complexity of the case applies to the appellant which is involved in the building industry and retains its own solicitor.
- [36]In deciding to award costs before the Tribunal, the following have been taken into account:
- (a)The appellant was successful on appeal.
- (b)The appellant filed its initial application. The respondent then sought to strike it out on the grounds that it was oppressive and vexatious. The original pleading was rambling and historical. The appellant saw the need to amend. It got leave on the morning of the application. The matter proceeded on the amended claim.
- (c)This application was somewhat complex in determining whether the claim by the appellant before the Tribunal was oppressive or vexatious. It did involve an extensive review of the cases put by both sides. Presently, the issue of who was responsible for breaching the contract is before the Tribunal. The initial finding by the Authority in favour of the respondent is being challenged. The appellant seeks payment of monies outstanding.
- (d)It is not necessary and in fact not possible to determine the merits of the appellant’s claim. The respondent claims that there were delays and that they have a partly built house in respect of which they have sought insurance from the QBSA. Apparently, that has continued to be processed before the Authority and is to be heard in the Tribunal. Both the appellant’s claim and the respondent’s claim remain to be heard depending upon the findings of the Tribunal on the contractual point.
- (e)Both parties have exercised their rights under the QBSA and the CCT Act in pursuing their rights under the respective legislation. It cannot be said that any legislation has been contravened by either side at this point.
The factors relevant to the exercise of the discretion under s 71(4) of the CCT Act have been considered. In the present case, the appellant has failed to satisfy me that there is a good reason in terms of the interests of justice for awarding costs in its favour before the Tribunal. The late amendment to its claim does not favour an award of costs. No order for costs in relation to the application by the respondent before the Tribunal seems appropriate.
- [37]In relation to the costs of the appeal, the appellant has had a determination which favours it. The Tribunal member has erred in his findings of the facts and applying those facts to the principles applicable in the application to strike out. Under the UCPR, costs usually follow the event.[76] A large part of this appeal was that the appellant was not entitled to leave to appeal as the order made by the Tribunal was of an interlocutory nature. The decision of Greg Kern & Co v Building & Civil Contractors (op cit) was against that view. The respondent also failed in upholding the Tribunal member’s decision which erred in law. In the circumstances, it is appropriate that the respondent do pay the appellant’s costs of the appeal.
Orders
- Leave is granted to the appellant to appeal the decision of the Tribunal dated 4 June 2008.
- The decision of the Tribunal is reversed and the order for costs quashed.
- The application by the respondent to dismiss the appellant’s claim as amended is hereby dismissed.
- Pursuant to s 100(8) of the Commercial and Consumer Tribunal Act 2003, the appellant is ordered to pay the costs associated with the appeal concerned with the steps prescribed for the initiation of the appeal to the District Court, as distinct from legal costs including the costs of any transcript.
- It is further ordered that the respondent do pay the appellant’s legal costs of the appeal to the District Court on the standard basis or as agreed.
- Liberty to apply.
Footnotes
[1] Appellant’s Appeal Book Record pp1 – 8.
[2] QBSA Act 1991 s 70
[3] Appeal Book pp 30-39
[4] Reasons of Tribunal at [33]. The claim was increased to $138, 700.29.
[5] Ss 60(1)(c) and 126(2)(b) were also relied upon by the Tribunal at [64]but are not relevant for present purposes and not relied upon by the appellant
[6] Respondent’s submissions filed 3 October 2008 at [5]-[7] at pp 178-200 of Appeal Book
[7] Affidavit of L. Harrold sworn 28 may 2008 at p 46 Appeal Book
[8] [2002] QDC 030
[9] Filed 6 February 2009
[10] s 92(1) of the Queensland Building Tribunal Act 2000; s 100 of the CCT Act can be found at p21 hereof.
[11] (1966) 117 CLR 423 at 440
[12] [1910] 1 Ch 489
[13] This was conceded by counsel for the appellant in argument
[14] Hall v Nominal Defendant op cit at 440; see also Tampion v Anderson and Just (No 2) [1973] VR 829 at 830 which supports the view that an order dismissing an action as vexatious is not a final judgment.
[15] This aspect will be discussed later in the reasons
[16] Commercial and Consumer Tribunal Bill 2003 p3
[17] S 14B(1)(a) of the Acts Interpretation Act 1954
[18] S 14B(3)(e) and (f)
[19] Submissions in response note 1 p1 at p 201 Appeal Book
[20] That was the case in Tampion v Anderson And Anor op cit and In re Page op cit
[21] [2003] QDC 304 at [3] in referring to s 100 of the CCT Act
[22] Adam P. Brown Male Fashions Proprietary Limited v Phillip Morris Incorporated and Anor. [1981] 148 CLR 170 at 177
[23] Appeal Book op cit at pp 192-3
[24] The Supplementary Final Submissions of the Appellant are marked Exhibit 6 and those of the respondent Exhibit 7
[25] See the discussion at [311,950.25] in Civil Procedure Queensland Civil District Court of Queensland Act 1967
[26] Tampion v Anderson (1973) VR 829 at 831; Adam Peter Brown Male Fashions Pty Ltd v Phillip Morris Incorporated (1981) 148 CLR 170 at 176-177 per Gibbs CJ, Aickin, Wilson and Brennan JJ
[27] (1946) 46 SR (NSW) 318 at 323 per Sir Frederick Jordan
[28] Exhibit 7 at [8]
[29] Exhibit 7 at [5]
[30] S 4 of the CCT Act
[31] s 14A(1); see also Re The News Corporation Ltd and others (1987) 70 ALR 419 at 428 referred to at [16] of Exhibit 7
[32] s 14B
[33] Exhibit 7 at [17]
[34] House v The King [1936] 55 CLR 499 at 504-505
[35] Greg Kern & Co Pty Ltd Atf the Tiffany Trust v Building and Civil Contractors Pty Ltd [2007] QDC 059 at [4]-[8]
[36] The problem was highlighted in In re Page op cit per Buckley LJ at 493-494; see also the submissions Exhibit 6 at [15]
[37] Queensland Building Tribunal Act s 92
[38] Appellant’s submissions in response filed 6 February 2009 at [11] referring to Clements v Flower [2005] QDC 50 per Wilson J and McDonald v Douglas Shire Council [2002] QCA 387 at [5] per Jerrard JA and at [24] per Atkinson J. See also respondent’s submissions at [16] op cit
[39] Form 4 para E
[40] Exhibit 7 at [28]-[34]
[41] Appeal Book pp 30-39
[42] The Tribunal member described it as “…the superficial appearance of a valid claim” at [64] of Reasons
[43] Reasons at [62] Appeal Record at p 135
[44] s 58(a)
[45] Respondent’s submissions dated 29 May 2008 at [21]-[27] at p 56-68 Appeal Record
[46] Cassatone Nominees Pty Ltd v Queenslandwide House & Building Reports Pty Ltd (2008) QCA 102 at [46] Per Fraser JA with whom President McMurdo and Fryberg J agreed.
[47] Contrast cases such as Queensland Pork Pty Ltd v Lott [2003] QCA 271 at [41] per Jones J
[48] Cassatone Nominees Pty Ltd v Queenslandwide House & Building Reports Pty Ltd op cit at [9] per Fraser JA
[49] [1997] 1 Qd R 225,233
[50] Freedom Homes Pty L td v Botros [1999] QCA 150 at [10]
[51] (1990) 170 CLR 321 at 356 per Mason CJ
[52] See also Deane J at 367 for a similar statement
[53] Section 83 of the QBSA Act gives the Tribunal the power to manage the case
[54] op cit at [35] at p 168
[55] Port of Melbourne Authority v Anshun Pty Ltd (No 2) (1980-1981) 147 CLR 589
[56] under the Queensland Building Services Authority Act (Qld)(“the QBSA Act”)
[57] Williams v Spautz (1991-1992) 171 CLR 509 at 526-527 per Mason CJ, Dawson, Toohey and McHugh JJ
[58] Williams v Spautz was applied in International Entertainment (Aust) Pty Ltd v Churchill [2003] QSC 247 at [23] per McMurdo J
[59] s 31; the respondent was entitled to defend under s 33
[60] s 86(1)(i)
[61] Saitta Pty Ltd v Commonwealth (No 2) [2003] VSC 346 at [29]-[31] per Williams J.
[62] Submissions in response at [17] p 204 of Appeal Record
[63] Respondent’s submission at [42] Appeal Record p 190 and reasons at [53]; events subsequent to the Tribunal hearing are not relevant.
[64] Affidavit of L. Harrold sworn 28 may 2008 at [3f]. The documents were sent on 10 or 11 April.
[65] 58(a); Oceanic Sun Line Special shipping Company Inc v Fay (1988) 165 CLR 197 at 233 per Brennan J and Deane J at 243
[66] (1974) AC 436 at 477
[67] op cit at 233; see also Risefer v Permanent Trustee Company Ltd (2005) 1 Qd R 681 at [11] & [25] per Keane JA.
[68] per Lord Simon of Glaisdale in The “Atlantic Star” (op cit)
[69] The “Atlantic Star” op cit at 477
[70] [2002] QCA 546 at [36]-[38] per McMurdo P and Atkinson J
[71] op cit at 247
[72] (1990) 171 CLR 538
[73] s 83 QBSA
[74] Reasons at [51]-[53] and [68]-[70]
[75] (2005) 2 Qd R 101
[76] Rules 766(d) and 785 referred to by Keane JA in Tamawood Limited op cit at [39]; Olivant v Wright (1875) 45 LJ Ch 1 referred to at r 766.50 Civil Procedure in Queensland, UCPR, Butterworths