Belmed Pty Ltd v Nichols Constructions Pty Ltd [2012] QCAT 452

CITATION: Belmed Pty Ltd v Nichols Constructions Pty Ltd [2012] QCAT 452 PARTIES: Belmed Pty Ltd trading as Belmont Medical Centre (Applicant/Appellant) v Nichols Constructions Pty Ltd (Respondent) APPLICATION NUMBER: RSL086-11 MATTER TYPE: Retail shop leases matters HEARING DATE: On the papers HEARD AT: Brisbane DECISION OF: Michelle Howard, Acting Senior Member DELIVERED ON: 13 September 2012 DELIVERED AT: Brisbane ORDERS MADE: 1. The application for costs of Nichols Constructions Pty Ltd is dismissed. CATCHWORDS: COSTS APPLICATION – where application by respondent for dismissal or striking out refused – where applicant directed to file amended notice of dispute – where respondent seeks legal costs of dismissal application and previous steps in the proceeding – where leave for legal representation granted at same time application for dismissal refused Queensland Civil and Administrative Tribunal Act 2009, ss 47, 100, 102 APPEARANCES and REPRESENTATION (if any): This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act). REASONS FOR DECISION [1] On 28 June 2012, I made orders dismissing an application filed by Nichols Constructions Pty Ltd which sought the dismissal or striking out of a notice -- 1 of 5 -- 2 of dispute filed by Belmont Medical Pty Ltd. I also made orders allowing Belmont Medical Centre to file and serve an amended application. As my reasons for decision discuss, Belmont Medical Centre acknowledged that the actual lessee was an associated company, Belmed Pty Ltd, as disclosed in the documentation filed with their original application. The originally named applicant was the trading entity. Belmed was to be named as the applicant in the amended application. [2] On the same day, I made orders on another application filed by Nichols Constructions granting leave to both parties to be legally represented. Nichols Constructions is legally represented. [3] At a directions hearing on 17 July 2012, Nichols Constructions indicated that it wished to make a costs application. I made directions in relation to that application and other matters. The directions of 17 July 2012 provide for the filing of any application for costs and submissions by Nichols Constructions; Belmed’s response to the costs application; the hearing of that application for costs on the papers; for Nichols Constructions to file a response to the amended application of Belmed; for Belmed to file all of the witness statements it relies upon; for Nichols Constructions to file all witness statements it relies upon; for a further directions hearing on 23 October 2012; a further compulsory conference on 8 November 2012; and a two day hearing on 13 and 14 December 2012. [4] For completeness, I note that a further directions hearing was held on 7 August 2012. No directions were made on that date. [5] Written submissions have been received from both parties regarding the application for costs. A separate application for costs was not filed. The parties’ submissions [6] Nichols Constructions seeks a costs order pursuant to s 47 for its costs of and incidental to the proceedings brought against it by Belmont Medical Centre on an indemnity basis. The order is sought to compensate it for costs described, in essence, as being wasted, because they say, the application has in effect been started again, even though their application for dismissal was unsuccessful. The costs sought are said to be compensation for reasonable costs, expenses, inconvenience and embarrassment resulting from the proceeding or part of it which lacked substance. [7] Nichols Constructions relies upon the directions made on 17 July 2012 to support the application for costs. They argue that the directions reflect that although it was unsuccessful on its strike out application, the Tribunal has implicitly acknowledged the proceeding was lacking in substance by granting leave to amend the application and ‘recommencing’ the proceeding so that Nichols Constructions must now go through all of the steps with the new applicant, that it went through with the former applicant, Belmont Medical Centre. -- 2 of 5 -- 3 [8] Belmed submits that section 47 operates in circumstances where the Tribunal makes a decision to dismiss, strike out or decide that a proceeding or part of it is unjustified. It contends that as there was no finding that any part of the application was unjustified, the application for costs can not succeed. Belmed says that the substantive issues remain the same and past steps do not need repeating. Further, it submits that section 100 of the QCAT Act, which provides for each party to usually bear their own costs is the starting point for consideration of the application, while acknowledging that section 102 provides for awarding of costs if the interests of justice require it. [9] Further, it submits that Nichols Constructions chose to retain legal representatives although leave was not granted by the Tribunal until recently and now seeks retrospective costs for a period when leave for legal representation was not allowed. Further, it refers to the delay between the filing of the application and the strike out application. It further says that even if costs were allowed there is no basis for an award of indemnity costs. Discussion and decision [10] Section 47 applies if the Tribunal considers that the proceeding or part of it is frivolous, vexatious or misconceived; lacking in substance; or otherwise an abuse of process: s 47(1). The Tribunal may, in the exercise of its discretion, among other things, in those specified circumstances in which the section applies, dismiss or strike out the proceeding or part of it; or make a costs order against the party who brought the proceeding to compensate for any reasonable costs, expenses, loss, inconvenience or embarrassment. Therefore, an order for costs can be made under s 47 as a means of addressing the situation when the application or part of it is considered by the Tribunal to fall within those categories specified in s 47(1). [11] In this case, the application to dismiss or strike out the application was unsuccessful. I did not make a finding that the application fell into the categories specified in section 47(1). I held neither of the bases contended by Nichols Constructions, as warranting striking out of the application, was successful. I directed filing of an amended application to correct the notice of dispute which had been brought in the name of the trading entity associated with the lessee, Belmed. [12] Nichols Constructions argue that the directions of 17 July 2012 indicate implicit acceptance that the application was lacking in substance and force it to go through all steps again. In this regard, I make the observation that Nichols Constructions had not filed a response to the notice of dispute previously, although both parties had filed some material to be relied upon at hearing. The parties had attended a compulsory conference, but a second conference before a hearing is not unusual, especially in circumstances when not all material to be relied upon has been filed by the parties at the time of the first conference. -- 3 of 5 -- 4 [13] Whether there will be any significant repetition of previous steps as a consequence of the directions made on 17 July 2012 remains to be seen. It is apparent from my reasons for decision that I intended, through the orders made on 28 June 2012, to avoid the need for the proceedings to be recommenced de novo. [14] Section 47 allows the Tribunal, in its discretion, if it is satisfied that s 47(1) applies, to make various orders in the alternative. One of those orders is an award of costs. In this case, the application under section 47 has already been dismissed by me and I made no finding that the section applied. Therefore, there is no basis for making an order for costs under section 47. Also, an award of costs is a possible alternative order to dismissal when a section 47 application is made. There is no current application. In my view this application for costs under section 47 must fail. [15] In any event, I make the observation that the parties were granted leave for legal representation on 28 June 2012, the same day as the application of Nichols Constructions for strike out was refused. Even if the application for costs pursuant to s 47 was properly made at this stage, I would not in my discretion make an order for costs even had I found the original notice of dispute was lacking in substance, which I did not, because leave had not been granted for legal representation when the costs which are claimed were incurred. [16] Also, to the extent that an award of costs is sought on the basis that there may be some duplication of steps, I do not accept that will inevitably be so, other than to a minor extent. For example, reading one or two amended pages, in the amended notice of dispute was no doubt necessary. Reading several folios in amended statements, amending the name of the lessee may also be necessary. However, there may be no other ‘duplication.’ [17] Further, as I understand this costs application by Nichols Constructions, it is specifically made pursuant to s 47. However, Belmed refers to general principles relating to costs applications as provided for in sections 100 and 102 of the QCAT Act. I have also considered whether an order under those provisions is appropriate. Section 100 contains a strong contra- indication against costs orders.1 That said, s 102 provides for costs orders to be made in the Tribunal’s discretion in circumstances when the interests of justice require it. [18] For reasons similar to those set out in paragraphs [15], relating to the granting of legal representation on the day the s 47 application was dismissed, and [16] above, I do not consider it in the interests of justice to exercise the discretion to make an order for the costs sought under the general costs provisions in favour of Nichols Constructions. 1 Ralacom Pty Ltd v Body Corporate for Paradise Island Apartments (No 2) [2010] QCAT 412; McEwen v Barker Builders Pty Ltd [2010] QCATA 49. -- 4 of 5 -- 5 [19] I make orders dismissing the application for costs. -- 5 of 5 --