Pong Property Development v Strangio [2005] VSC 217
In the Supreme Court of Victoria, Ashley J allowed a developer's appeal on a question of law from the Victorian Civil and Administrative Tribunal, set aside orders summarily striking out its application for payment into the Domestic Building Fund and compensating Mr Strangio (the third respondent) and remitted the matter, because the Tribunal's reasons did not support treating the application as liable to be struck out from its inception and did not reveal which statutory ground was relied on [2], [6], [59], [62], [63], [68], [76].
What the court decided
The appeal was brought by leave under section 148 of the Victorian Civil and Administrative Tribunal Act 1998 [1]. The developer commenced a proceeding in the Tribunal's Domestic Building List by application filed 20 November 2002 [5]. The claims rested on the Domestic Building Contracts Act 1995 and the Fair Trading Act 1999 [7]. On 23 January 2003 the Tribunal set aside for separate hearing whether the disputed money should be paid into the Domestic Building Fund [18]. That application was one the Tribunal itself proposed as an alternative to the application of which the developer had given notice [19].
On 8 September 2004 the Court of Appeal decided Winslow Constructors Pty Ltd v Mt Holden Estates Pty Ltd, which as his Honour understood it excluded subdivision preparation work from the Domestic Building Contracts Act [37]. There was a lengthy hearing before the Tribunal on 4 October 2004 [39]. At that hearing the developer relied on the alleged demolition of premises by the builder to distinguish Winslow [41]. On 14 October 2004 the developer applied to vacate the hearing of the payment application [47]. Its counsel submitted that the application should be adjourned for disposition at trial [48]. The Tribunal confirmed the hearing date of 25 November and ordered the developer to pay the costs of the day [50]. By letter dated 29 October 2004 the developer sought to abandon the application [51]. Counsel for Mr Strangio later asked the Tribunal to strike it out under section 75(1), enlivening the broad discretion in section 75(2) [54]. The Tribunal did so and ordered compensation under section 75(2) [56].
His Honour said that reasons of an administrative tribunal should not be examined word by word [57]. He nonetheless held that the appeal must succeed [59]. The orders necessarily implied the Tribunal's opinion that the application met a section 75(1) description from its inception in January 2003 [62]. Yet the reasons focused on what had happened from and after 4 October 2004 [62]. Depending on what the Tribunal had done, its reasons were inadequate, it failed to consider a matter it was bound to consider or its opinion was unreasonable [63]. The section 75(2) order also operated indiscriminately across a period when jurisdiction was not seriously in issue and a period when it was under substantial challenge [64]. On an assumption that the Tribunal had jurisdiction under the Domestic Building Contracts Act, nothing suggested that the application fitted section 75(1) before September 2004 [65].
Reasons should be sufficient to reveal to the losing party why it lost and to disclose the reasoning process [67]. The Tribunal had simply repeated the words of paragraphs (a) and (b) of section 75(1), so it was impossible to know which alternative it relied on [68]. Those reasons were at least relevantly inadequate, and in his Honour's view seemed to reveal error [68]. By wrongly characterising the application globally, the Tribunal failed to address questions such as whether it had any jurisdiction under the Domestic Building Contracts Act against Mr Strangio [69]. The Tribunal's criticism of the developer's senior counsel was "quite misconceived, and wholly unreasonable" [70].
Counsel for Mr Strangio submitted that the orders were interlocutory and that entertaining the appeal would fragment the proceeding [71]. Without deciding whether they were interlocutory, his Honour dealt with the appeal because the orders addressed a discrete issue with serious monetary implications [71]. He held that the developer was not obliged to seek written reasons under section 117(2) [73], [74]. Mr Strangio's counsel rightly conceded that paragraph 1 of the orders did not resolve the jurisdictional question [75]. Orders 1 to 3 were set aside and the matter was remitted to the Tribunal, similarly constituted, to consider afresh sections 74 and 75 [76]. The parties were not to be foreclosed from making further submissions [76].
Why it matters
The decision shows that where an abandoned application is struck out with compensation under section 75, the Tribunal may need to address the whole period the application was on foot, including any period before its weakness emerged. It also shows that reasons which merely recite the alternative statutory grounds for a strike out may be inadequate, even allowing for the latitude given to an administrative tribunal [57], [68]. Readers should check the current text of the Tribunal's governing Act.
Numbers in square brackets are paragraph numbers of the judgment. This note summarises a decided case for education and is not legal advice. See how the notes are written.