Supreme Court New South Wales

• Medium Neutral Citation: Franks v Consumer, Trader and Tenancy Tribunal [2013] NSWSC 341
• Hearing dates: 7/03/2013
• Decision date: 19 April 2013
• Before: Fullerton J

Decision

1.  Quash part of the third order made by the Consumer, Trader and Tenancy Tribunal on 14 December 2012 so that the order reads:

 

3. Phillip Franks is to pay The Owners Corp SP-70672 costs as agreed or assessed.    

 

2.  Orders 1 and 2 made by the Consumer, Trader and Tenancy Tribunal on 14 December 2012 remain undisturbed.

 

3.  Otherwise the summons is dismissed.

 

4. The plaintiff to pay the second defendant’s costs.

• Catchwords: APPEAL - appeal from Consumer, Trader and Tenancy Tribunal - strata schemes adjudicator - jurisdiction
• Legislation Cited: Civil Procedure Act 2005; Consumer, Trader and Tenancy Tribunal Act 2001; Strata Schemes Management Act 1996; Supreme Court Act 1970; Uniform Civil Procedure Rules 2005
• Cases Cited: Boral Gas (NSW) Pty Ltd v Magill (1993) 32 NSWLR 501; Carnley v Grafton Ngerrie Local Aboriginal Land Council [2010] NSWSC 837; Great Lakes Council v Lani [2007] NSWLEC 681; 158 LGERA 1; Kirk v Industrial Relations Commission (NSW) [2010] HCA 1; 239 CLR 531; Kostas v HIA Insurance Services Pty Ltd [2010] HCA 32; 241 CLR 390; Re Refugee Review Tribunal; Ex parte Aala [2000] HCA 57, (2000) 204 CLR 82
• Category: Principal judgment
• Parties: Phillip Maurice Franks (Plaintiff); Consumer, Trader and Tenancy Tribunal (1st Defendant); The Owners - Strata Plan No. 70672 (2nd Defendant)
• Representation: Counsel: D Robinson SC/G George (Plaintiff); D Knoll (2nd Defendant); Solicitors: Parramatta Lawyers (Plaintiff); Grace Lawyers (2nd Defendant)
• File Number(s): 2012/249755

Decision under appeal

• Before: Consumer Trader and Tenancy Tribunal
• File Number(s): SCS 11/18967; SCS 11/50143

JUDGMENT

The facts

1 At relevant times between 2007 and 2011 the plaintiff was the owner and occupier of unit 2203 in The Cove Apartments (the Apartments) situated at The Rocks in Sydney. Under the applicable strata scheme the common property vested in the second defendant (the Owners Corporation), a statutory corporation responsible for managing the Apartments.

2 By operation of s 44 of the Strata Schemes Management Act 1996 (the Act) the owners (and occupiers) of the Apartments are obliged to comply with by-laws adopted by the strata scheme for the mutual benefit of all owners (and occupiers).

3 By-law 7.1 provides:

7.1 You must not:

(a) make noise that interferes unreasonably with another owner or occupier;

(b) use language or behave in a way that is reasonably likely to offend or embarrass another owner or occupier or their visitors;

(c) obstruct a person's legal use of Common Property;

(d) use equipment that interferes with equipment or appliances used by the Owners Corporation or another owner or occupier;

(e) do anything that might damage the good reputation of Cove Apartments; or

(f) do anything in Cove Apartments that is illegal.

4 By s 138(1) of the Act the power to determine a strata scheme dispute vests in a Strata Schemes Adjudicator. That section provides:

An Adjudicator may make an order to settle a dispute or complaint about:

(a) an exercise of, or a failure to exercise, a function conferred or imposed by or under this Act or the by-laws in relation to a strata scheme, or

(b) the operation, administration or management of a strata scheme under this Act.

5 Under s 217 and s 218 of the Act the Minister may appoint Strata Scheme Adjudicators who have conferred upon them the functions of an Adjudicator under the Act including, so far as is relevant to this case, the function under s 138 of the Act.

6 An application to determine a dispute must be lodged with the Consumer, Trader and Tenancy Tribunal (the first defendant) and the hearing of the dispute preceded by mediation unless mediation has been attempted but was unsuccessful or the Registrar considers mediation is unnecessary or inappropriate. Although mediation did not take place in this case nothing turns on that fact for the purpose of these proceedings. An appeal lies from the Adjudicator to the Consumer, Trader and Tenancy Tribunal (the CTTT) under s 177 of the Act and from the Tribunal to the District Court on a question of law under s 200 of the Act.

The first application - the August order

7 On 14 April 2011, the solicitor acting on behalf of the Owners Corporation filed an application with the CTTT in which it was alleged that the plaintiff had breached by-laws 7.1(b) and 7.1(f) on repeated occasions between 2007 and 2011 by abusive, threatening and assaultive conduct. Orders were sought under s 138(1) of the Act that the plaintiff comply with the by-laws.

8 The application was accompanied by statements from a large number of residents and their guests and from employees of the Owners Corporation who were either the victims of the plaintiff's abuse, threats and assaults, or who had witnessed the plaintiff's abusive treatment of others. The solicitor furnished detailed written submissions in support of the application.

9 On 18 July 2011, the plaintiff responded to the application. He described the claims made against him as "unsubstantiated" and "falsified", adding that:

I have always diligently adhered to the By Laws and will continue to do so with respect.

10 The dispute was referred for adjudication and adjudicated "on the papers".

11 In written reasons dated 5 August 2011 the Adjudicator summarised the nature of the dispute and the material furnished in support of it. He noted that the plaintiff did not deal with the complaints, seriatim, in his written response, whether by way of denial or explanation. He also noted that some of the complaints alleged the plaintiff had committed criminal offences, the determination of which was beyond his jurisdiction, including complaints related to the plaintiff's conduct outside of the strata scheme. He then held as follows:

16. I am satisfied that the behaviour of the respondent as described at paragraphs 4, 6, 7, 8, 10, 12, 13, 16, 18, 24, 27, 28, 30, 31, 32, 36, 42, 43, 44, 45, 50, 51, 52, 54, 55, 57, 58, 59, 61, in the submissions of the applicant amounts to conduct that is likely to offend or embarrass another owner or occupant of the strata scheme, in breach of by-law 7.1(b).

17. Furthermore I am satisfied that at least some of the conduct (paragraphs 13, 18, 27, 44, 50, 54, 55, 58, 59, 61) may constitute an illegal act contrary to the provisions of the Crimes Act 1900 s 61 and 545B so as to put the respondent in breach of by-law 7.1(f). (Emphasis added)

12 He made the following order:

An order is made pursuant to the provisions of the Strata Schemes Management Act 1996, s 138 that the respondent shall not use language or behave in a way that is reasonably likely to offend or embarrass another owner or occupant of the strata scheme or their visitors and shall not do anything illegal within the strata scheme and in particular shall not insult, abuse, assault, intimidate, bully or threaten any other lot owner, resident or employee of the Owners Corporation

(Emphasis added)

13 By letter dated 12 August 2011 the plaintiff was advised of the terms of the order and its effect. He did not appeal the order to the CTTT as provided for in s 177 of the Act, nor seek a stay of the order from the Adjudicator as provided for in s 180(1).

The second application - the December order

14 On 6 October 2011 the solicitor for the Owners Corporation lodged an application with the CTTT for the imposition of a pecuniary penalty pursuant to s 202 of the Act on the basis of the plaintiff's contravention of the Adjudicator's order of 5 August 2011 by threatening and intimidating a resident in the elevator on 10 September 2011. The maximum penalty provided for under the Act is 50 penalty units or $5,500.

15 The application was listed for directions on 2 November 2011 and a timetable fixed for the filing and serving of submissions. On 7 November 2011 the matter was fixed for hearing on 14 December 2011. No submissions were filed by the plaintiff and there was no appearance for the plaintiff at the hearing.

16 The CTTT heard evidence and submissions on behalf of the Owners Corporation (including, at their invitation, on the issue of indemnity costs) and made the following orders:

1. The Tribunal is satisfied that the respondent, Phillip Franks [the plaintiff] has breached the order made on 05/08/2011 in SCS 11/18967.

2. The Tribunal orders the respondent Phillip Franks to pay a penalty of $5,500 by 14/1/2012 to the Director-General, Department of Services, Technology & Administration, Level 6, McKell Building, 2 - 24 Rawson Place, Sydney NSW 2000.

3. Phillip Franks is to pay The Owners Corp SP-70672 costs on an indemnity basis, as agreed or assessed.

17 The reasons for the CTTT's decision included the following:

...the breach of the adjudicator's order, so soon after it was made indicates that the respondent has little regard for either the order itself, or for the requirement for compliance with by-laws. I find that the serious nature of the incident on 10/09/2011 and the respondent's egregious behaviour justifies the imposition of the maximum penalty under s 202 of the Strata Schemes Management Act 1996 as well as an order that the respondent pays the Owners Corporation's costs on an indemnity basis...

(Emphasis added)

18 The jurisdiction to order costs is found in s 204 of the Act which provides:

(1) The Tribunal may also make an order for the payment of costs when making an order requiring the payment of a pecuniary penalty under this Part.

(2) Any costs awarded against a person on an application for an order under section 202 include the amount of the fee paid when the application for the original order was made.

19 The plaintiff was advised in writing of the order and of his right to appeal to the District Court on a question of law within 28 days. No appeal was lodged within that time frame. An appeal to the District Court was lodged in January 2012 but discontinued in March 2012.

20 The plaintiff relied upon two grounds in challenging the December order on the basis of jurisdictional error in this Court: the first that when imposing the maximum penalty the CTTT failed to consider the discretionary principles of parity and proportionality; and the second that the order for indemnity costs was made contrary to established principle in that it was expressly awarded as an additional punishment for what the CTTT was satisfied was the plaintiff's "egregious behaviour". Only the second ground was pressed at the hearing.

21 By summons filed in this Court on 9 August 2012 the plaintiff seeks relief in the nature of certiorari under s 69 of the Supreme Court Act 1970 and an order that the matter be remitted to the CTTT to be determined according to law. The plaintiff seeks the same relief with respect to orders made consequent upon an application by the Owners Corporation, lodged with the CTTT in October 2011, for the imposition of a pecuniary penalty under s 202 of the Act after the plaintiff breached the August order. This will be referred to as "the December order".

22 The plaintiff's Uniform Civil Procedure Rules 6.12A statement identified what were said to be multiple legal errors in the Adjudicator's decision that gave rise to the August order and in the decision of the CTTT that gave rise to the December order. At the hearing only one ground was pressed so far as the Adjudicator's decision was concerned and one ground in relation to the decision of the CTTT to impose a pecuniary penalty and indemnity costs.

23 In so far as the August order was concerned, it related to that part of the order which required the plaintiff to comply with by-law 7.1(f), namely "not to do anything illegal within the strata scheme". It was submitted that the order was beyond power since it depended upon the Adjudicator being satisfied, on the balance of probabilities, that the plaintiff had previously engaged in illegal conduct and, on a proper construction of his reasons for decision, no such finding was made. In so far as the December order was concerned, it related only to the order for indemnity costs. It was submitted that in ordering that the plaintiff pay costs on an indemnity basis as an additional penalty for his conduct in breaching the August order he exceeded the jurisdiction to award costs under s 202 of the Act

24 On 31 July 2012 the second defendant applied to have the costs of the proceedings before the CTTT on the second application, and the costs of the discontinued District Court proceedings, assessed. That assessment had been adjourned pending the outcome of the proceedings in this Court.

25 Two further applications for the imposition of penalties for alleged breaches of the August order were pending in the CTTT at the time of the hearing of the summons. In the event that the challenge to the August order fails it is anticipated those proceedings will proceed before the CTTT without delay.

The challenge to the August orders

26 The challenge to the August order is limited to the finding of fact in paragraph 17 of the reasons for decision (see [11] above) which is said to ground the order prohibiting the plaintiff from committing any illegal acts in the future in breach of by-law 7.1(f) and, in particular, to what is said to be the necessary construction given to the word "may" inherent in that finding.

27 Senior counsel for the plaintiff submitted that when the Adjudicator declared himself satisfied in paragraph 17 that the past conduct of the plaintiff, which he identified by paragraph numbers in the submissions filed by the Owners Corporation, "may" constitute criminal activity and that this justified the order that the plaintiff refrain (in the future) from breaching by-law 7.1(f), he should be taken to have decided that the plaintiff's past conduct merely "could", in the sense that it "might", constitute a criminal act, (or that he was unable to decide whether the conduct was of that kind) as distinct from being satisfied that it was probable that it was conduct of that kind. It was submitted that a finding that it was merely possible that the plaintiff's past conduct amounted to a breach of either or both s 61 and s 545B of the Crimes Act did not ground the jurisdiction in s 138 of the Act to order that the plaintiff refrain in the future from doing:

... anything illegal within the strata scheme and in particular shall not insult, abuse, assault, intimidate, bully or threaten any other lot owner, resident or employee of the Owners Corporation.

28 Counsel submitted that a positive finding by the Adjudicator that the plaintiff's past conduct probably amounted to a criminal offence or offences was essential to ground jurisdiction and, since he made no such finding, the order requiring the plaintiff to comply with by-law 7.1(f) was beyond the jurisdiction conferred under s 138 of the Act, thereby constituting jurisdictional error.

29 Section 138(1) of the Act confers on an Adjudicator jurisdiction, inter alia, to settle a dispute or rectify a complaint about the operation, administration and management of the by-laws of a strata scheme (in this case, whether there has been a breach of a by-law) without specifying a standard of proof by which a breach must be found to have occurred as a precondition to the exercise of the power to require compliance with the by-law or by-laws under consideration. Counsel was unable to refer me to any authority for the proposition that before the jurisdiction in s 138 is enlivened, whether generally or, so far as this case is concerned, before it was open to the Adjudicator to order that the plaintiff comply with the prohibition in by-law 7.1(f) against doing anything illegal in the Apartments, that the factual finding supporting the making of the order for compliance must, by necessary implication, be made according to the civil standard of proof.

30 The fact that Adjudicators in other cases to which I was referred by counsel have expressed themselves to be satisfied on the probabilities that a particular by-law was breached, while in other cases a strata title dispute has been determined or resolved by the Adjudicator expressing himself or herself as simply satisfied that material matters are established, is not determinative. In my view, what those decisions indicate is that it is sufficient for an Adjudicator exercising the function under s 138 to be comfortably satisfied on the available material in the particular case that there is a genuine dispute or complaint which is capable of being resolved, and, where necessary, that the facts justify an order or orders settling the dispute, including orders requiring compliance with a by-law (or by-laws) by the person or persons whose conduct has been found to be in breach.

31 It is perfectly clear from the reasons for decision (the adequacy of which were not the subject of criticism save for lack of precision or potential ambiguity in his use of the word "may" in paragraph 17) that was the approach taken by the Adjudicator in this case. There is no reason to doubt that he was well satisfied that the plaintiff's behaviour, set out in considerable detail in the enumerated paragraphs of the submissions of the Owners Corporation, constituted conduct that was likely to offend or embarrass another owner or occupant of the strata scheme, in breach of by-law 7.1(b) despite the fact that he did not advert to any standard of proof referable to which that finding was made. The plaintiff's counsel accepted that finding was likely to have been made on the balance of probabilities.

32 I am unable to see why it should follow that when, in the next paragraph, the Adjudicator declared himself satisfied that some of that same behaviour also amounted to conduct that "may" have constituted an offence contrary to the Crimes Act he should be taken to have expressed himself as satisfied to any different standard. The two paragraphs are not only factually linked with the numbered paragraphs in paragraph 17, being a subset of the numbered paragraphs, but by his use of the word "furthermore" the Adjudicator must be taken to have intended that in addition to his being satisfied that there is proven conduct constituting a breach of by-law 7.1(b) some of that same conduct puts the plaintiff in breach of by-law 7.1(f) because it "may" also constitute specified criminal conduct and, that being so, that an order the plaintiff not do anything in the Apartments that is illegal should be made. .

16. I am satisfied that the behaviour of the respondent as described at paragraphs 4, 6, 7, 8, 10, 12, 13, 16, 18, 24, 27, 28, 30, 31, 32, 36, 42, 43, 44, 45, 50, 51, 52, 54, 55, 57, 58, 59, 61, in the submissions of the applicant amounts to conduct that is likely to offend or embarrass another owner or occupant of the strata scheme, in breach of by-law 7.1(b).

17. Furthermore I am satisfied that at least some of the conduct (paragraphs 13, 18, 27, 44, 50, 54, 55, 58, 59, 61) may constitute an illegal act contrary to the provisions of the Crimes Act 1900 s 61 and 545B so as to put the respondent in breach of by-law 7.1(f).

(Emphasis added)

33 Interpreted in that way, his use of the word "may" simply emphasised what the Adjudicator had noted earlier in his reasons, namely that while he had no jurisdiction to decide whether any of the conduct complained of was actually criminal, it appeared to him that at least some of the conduct may well constitute a breach of the criminal law and, for that reason, he was justified in making an order prohibiting the plaintiff from conducting himself in the future in a way that would put him in breach of the law. .

34 Counsel for the second defendant submitted that the interpretation of the Adjudicator's reason for decision for which the plaintiff's counsel contended, suggested the reasons (or a discrete part of them) had been combed with an eye for jurisdictional error, an approach to the exercise of the jurisdiction of this Court under s 69 of the Supreme Court Act which has been repeatedly criticised. I regard that submission well founded. I am not persuaded that the error of jurisdiction for which the plaintiff contended is made out.

35 Even were the order requiring the plaintiff to comply with by-law 7.1(f) made without jurisdiction, it would be necessary to decide in the exercise of discretion whether to grant the plaintiff the relief sought. In this case I would not have exercised the discretion in the plaintiff's favour.

36 In Carnley v Grafton Ngerrie Local Aboriginal Land Council [2010] NSWSC 837, a case where the decision of the CTTT to uphold the termination of the plaintiff's tenancy of certain lands was held to have been infected by jurisdictional error, Garling J reviewed the relevant authorities bearing on that question at [96]-[114]. In the result, his Honour was satisfied that he should exercise his discretion to grant the relief sought, namely a quashing of the decision and a direction that the matter remitted to the CTTT.

37 After noting at [96] that the categories of cases where relief is refused are not closed but are commonly withheld if there is another "equally effective and convenient remedy" (see Boral Gas (NSW) Pty Ltd v Magill (1993) 32 NSWLR 501 at 508F), his Honour noted at [97] that the mere existence of an alternate statutory remedy is not necessarily fatal to the provision of relief, particularly where it can be demonstrated that the statutory remedy was "nowhere near so convenient, beneficial and effectual". In this case, I am well satisfied that on any practical view the appeal against the Adjudicator's order to the CTTT under s 177 of the Act meets these criterion. The appeal under the Act is both more expeditious and necessarily less expensive than proceedings for judicial review in this Court (see Kostas v HIA Insurance Services Pty Ltd [2010] HCA 32; 241 CLR 390). In addition, not only does the CTTT have the specialist experience to resolve whether or not the Adjudicator was required, when exercising the jurisdiction under s 138, to find the breach of by-law7.1(f) established on the probabilities, the appeal is a hearing de novo where fresh evidence may have been adduced. An appeal to the District Court from the CTTT's decision on a question of law is also available under s 67 of the Consumer, Trader and Tenancy Tribunal Act 2001. As Garling J observed at [113]:

Parties are not entitled to expect simply because they bring proceedings to this Court that the Court will automatically grant relief. The failure to take advantage of other avenues for rehearing or for appeals where those avenues are quicker, less expensive and more suitable or appropriate, is a matter which can be, and typically will be, weighed in the balance by this Court when considering whether to exercise its discretion or not.

38 I should also add that an additional factor weighing heavily against the exercise of discretion in the plaintiff's favour, were I called upon to exercise it, is the fact that the proceedings in this Court were not brought in a timely fashion and, when instituted, were accompanied by a lengthy UCPR 6.12A statement and written submissions, most of which was ultimately abandoned the day before the hearing. I anticipate that this must have resulted in unnecessary costs incurred by the second defendant and what I know to be a wholly unwarranted waste of court time and judicial resources.

39 Furthermore, even assuming that it was appropriate to grant the relief sought in the exercise of discretion, in circumstances where there was no challenge to the Adjudicator's jurisdiction to order the plaintiff's compliance with by-law 7.1(b), I would have held that it was both open to me and appropriate to have quashed that part of the order (set out in full in [12] above) from the word "visitors", thereby leaving the balance of the order to have its intended effect. I note that an order, the effect of which would have been to partially quash the order and remit the residue of the dispute that gave rise to the August order to the CTTT to be dealt with according to law, was not resisted by the plaintiff's counsel.

The challenge to the orders made on December 2012

40 The plaintiff's counsel submitted that the order that the plaintiff pay the costs of the Owners Corporation on an indemnity basis, expressed by the CTTT to be an additional punishment for what they were satisfied was his egregious breach of the August order, amounted to a jurisdictional error being beyond the CTTT's jurisdiction under s 204 of the Act to award costs in favour of an applicant where it is satisfied that a penalty under s 202 should be imposed. It was further submitted that, characterised in that way, the privative clause in s 65 of the Consumer, Trader and Tenancy Tribunal Act is no impediment to this Court's jurisdiction to grant relief under s 69 of the Supreme Court Act.

41 The critical question however remains whether, assuming that the CTTT made the order for indemnity costs to punish the plaintiff for breach of the August order (an interpretation which is clearly open) and that is not a purpose to which an order for indemnity costs may properly be put (as to which there can be no real dispute) it is a jurisdictional error or an error within jurisdiction. If it is the latter then I am satisfied that s 65 of the Consumer, Trader and Tenancy Tribunal Act does operate to deprive this Court of jurisdiction under s 69 of the Supreme Court Act.

42 As Hayne J explained in Re Refugee Review Tribunal; Ex parte Aala [2000] HCA 57, (2000) 204 CLR 82 at 141:

...There is a jurisdictional error if the decision maker makes a decision outside the limits of the functions and powers conferred on him or her, or does something which he or she lacks power to do. By contrast, incorrectly deciding something which the decision

maker is authorised to decide is an error within jurisdiction...

43 In Kirk v Industrial Relations Commission (NSW) [2010] HCA 1; 239 CLR 531 at [67] the Court noted:

The drawing of a distinction between errors within jurisdiction and errors outside jurisdiction was held, in Craig [1995] HCA 58; (1995) 184 CLR 163, to require different application as between "on the one hand, the inferior courts which are amenable to certiorari and, on the other, those other tribunals exercising governmental powers which are also amenable to the writ". The Court said that:

"If ... an administrative tribunal falls into an error of law which causes it to identify a wrong issue, to ask itself a wrong question, to ignore relevant material, to rely on irrelevant material or, at least in some circumstances, to make an erroneous finding or to reach a mistaken conclusion, and the tribunal's exercise or purported exercise of power is thereby affected, it exceeds its authority or powers. Such an error of law is jurisdictional error which will invalidate any order or decision of the tribunal which reflects it."

By contrast, demonstrable error on the part of an inferior court "entrusted with authority to identify, formulate and determine" relevant issues, relevant questions, and what is and what is not relevant evidence was held, in Craig, not ordinarily to constitute jurisdictional error. The Court held that:

"a failure by an inferior court to take into account some matter which it was, as a matter of law, required to take into account in determining a question within jurisdiction or reliance by such a court upon some irrelevant matter upon which it was, as a matter of law, not entitled to rely in determining such a question will not ordinarily involve jurisdictional error".

44 The jurisdiction to award costs in favour of the Owners Corporation under s 204 was discretionary. The CTTT determined to exercise their discretion in favour of the Owners Corporation. The Act is silent as to the basis or bases upon which costs might be ordered. Section 98(1)(c) of the Civil Procedure Act 2005, which makes express provision for costs to be awarded on an ordinary basis or on an indemnity basis, does not apply to proceedings before the CTTT.

45 On the assumption that the CTTT had jurisdiction to order that costs the subject of consideration under s 204 be paid on an indemnity basis, (an issue which did not attract argument in the proceedings before me) I am satisfied that the CTTT fell into error in this case in ordering that the costs of the proceedings for breach of the August order should be paid by the plaintiff on that basis, there being nothing in his conduct of the proceedings before it to justify a finding of misconduct such as might have attracted an order of that kind and none suggested by the CTTT's findings. Costs orders are not designed to perform a punitive function. Special costs orders, including an order for indemnity costs, are directed to compensate a party who has been unjustifiably put to greater expense by reason of the opponent's conduct of the litigation. In Great Lakes Council v Lani [2007] NSWLEC 681; 158 LGERA 1, in the context of civil enforcement proceedings arising out of breach of a statute which is analogous to the proceedings for breach of the Adjudicator's order before the Tribunal, Preston J held at [31]:

I do not consider that there is any special or unusual feature in the circumstances of this particular case justifying a departure from the usual basis for an order of costs that is on a party and party basis. First, the nature of each of the breaches of the statues in question is not a special or unusual feature by itself. Costs are not to be used for punitive purposes. There is no rule that as between the differing bases for ordering costs - party and party, solicitor and client, and indemnity - the selection of the basis depends upon the seriousness of the breach of statute the subject of the civil enforcement proceedings. The seriousness of the breach of the statute cannot be used as an aggravating circumstance warranting departure from ordering costs on the usual basis, namely party and party basis, to another basis such as indemnity basis.

46 I am satisfied that the error of law in ordering the plaintiff to pay indemnity costs is a jurisdictional error thereby invoking the jurisdiction under s 69 of the Supreme Court Act. In considering the exercise of the discretion to which I have referred in paragraphs [35] and [39] above, as I noted in [19], the plaintiff was advised in writing of the CTTT's order and of his right to appeal to the District Court on a question of law under s 67 of the Consumer, Trader and Tenancy Tribunal Act within 28 days. No appeal was lodged within that time frame. An appeal to the District Court was lodged in January 2012 but discontinued in March 2012 without explanation. The summons commencing proceedings in this Court for relief under s 69 of the Supreme Court Act was then filed in August 2012. Both the delay and the unexplained failure to exercise other avenues of redress weighs heavily against the exercise of the discretion, however, since it is only that part of the costs order requiring that they be paid on an indemnity basis that was made in excess of power under s 204, I propose to grant the plaintiff limited relief by quashing that part of the order set out in full in [16] the words "on an indemnity basis", leaving the balance of the order (which is not under challenge) to have its intended effect.

Orders

47 Accordingly, I make the following orders:

1. I quash part of the third order made by the Consumer, Trader and Tenancy Tribunal on 14 December 2012 so that the order reads:

3. Phillip Franks is to pay The Owners Corp SP-70672 costs as agreed or assessed.

2. Orders 1 and 2 made by the Consumer, Trader and Tenancy Tribunal on 14 December 2012 remain undisturbed.

3. Otherwise the summons is dismissed.

4. The plaintiff to pay the second defendant's costs.

**********

Decision last updated: 03 May 2013