High cost of choosing wrong Tribunal tactics

Anyone heading for a hearing at NCAT who is considering “Trumpifying” their case by overloading the tribunal with documents, denying known facts to confuse the issue, and digging their heels in by dismissing genuine offers of compromise should think again as it could cost a bucketload of cash.

The former caretaker managers in the recent Acacia Gardens case have just had costs awarded against them for employing tactics that the tribunal Member felt warranted the “special” circumstances that can trigger a costs award.

Just to backtrack, although NCAT hearings are supposed to be conducted as low-cost, pay-your-own-way processes, there are special circumstances in which the Member hearing the case must consider awarding costs to one side or the other.

These include (but are not limited to):

• whether a party has conducted the proceedings in a way that unnecessarily disadvantaged another party to the proceedings,
• whether a party has been responsible for prolonging unreasonably the time taken to complete the proceedings,
• the relative strengths of the claims made by each of the parties, including whether a party has made a claim that has no tenable basis in fact or law,
• the nature and complexity of the proceedings,
• whether the proceedings were frivolous or vexatious or otherwise misconceived or lacking in substance,
• whether a party has refused or failed to comply with the duty imposed by section 36(3),
• any other matter the Tribunal considers relevant.

*Section 36 (3) of the tribunals Act requires active participants in cases to “facilitate the just, quick and cheap resolution of the real issues in the proceedings.”

So how might you lose a case and have to pay the other side’s costs – or even win and have to pay, as has happened, albeit rarely – by choosing the wrong tactics?

Delaying the proceedings with unreasonable last-minute demands for information might do it, as would dumping reams of supposed evidence documents on the table just when everything was set to go.

Keeping vital information from the other side might set alarm bells ringing and lining up witnesses who have nothing to contribute would do it too.

Then there’s pursuing a case you know you can’t win unless the other side just gets fed up or runs out of money may raise legal hackles.

Getting “smart” during examination by the other side, by refusing to admit to facts that are known to be true is a delaying tactic that might work in an American TV courtroom but butters no parsnips in an Australian tribunal.

In the Acacia Gardens case, the respondents apparently declined to accept that they had been on the strata committee when it was plain that they had been. This was cited by the Member as one reason they were having costs awarded against them.

“The Tribunal is satisfied that the duration of the hearing, and thus the costs, was increased by the unreasonable failure to concede matters such as [the respondents’] membership of the strata committee,” Senior Member Graham Ellis SC said in his summing up.

Refusing to reasonably consider a genuine attempt to reach a compromise, was also one of the reasons given for awarding costs in that case.

These were not the only reasons given.  Other matters were taken into consideration, individually and collectively.  And it should be noted that the respondents in this case may yet appeal the decision, and the plaintiffs may also appeal against only receiving “ordinary” costs and not the higher amount of “indemnity” costs

The important thing to remember is that the awarding of costs to one side or another is not a penalty related to the rights and wrongs of the case, it’s more a reflection of how willing or not either party has been to reach a fair and equitable solution in a reasonable time.

That’s why it’s possible to win on the legal points but end up having to pay the other side’s costs because of the way you conducted the case. If you make the hearing go longer than it needed to, you could trigger the costs question.

So, if you ever do end up at a tribunal, try to suppress your inner Perry Mason and Rumpole of the Bailey, and make an effort to get to the facts as quickly and transparently as possible.