The next time you think you have a rock-solid strata case – so good that you want to take it to the Supreme Court, where you think wiser heads may prevail than at say, a tribunal (NCAT), think again.
According to our good friend, strata lawyer Tony Cordato, even if you win, you could lose … and expensively.
In May this year, a Potts Point owner was successful in obtaining a NSW Supreme Court declaration that his owners corporation could not interfere or restrict access to the car parking space (pictured).
But he was shocked by the order that he pay the owners corporation’s legal costs of going to court – he thought that it should be the reverse – the owner’s corporation pay his costs because he had won.
The other week, the NSW Court of Appeal upheld the order that he pay the legal costs of the owners corporation’s failed defence. The reason given was that the owner had chosen the high-cost option of going to court, rather than the low-cost, Strata Act-suggested alternative of going to the Tribunal (NCAT).
“If you go to court and win, as a general rule the loser will pay your legal costs,” says Tony. “Legal Costs are often in the range of $40,000 to $80,000 for a contested hearing of one or two days in the Supreme Court, so it’s no wonder that people avoid going to court if they possibly can – because the legal fees are very high and what they are fighting over is not worth it.
“It is for this reason that the Strata Titles Law encourages strata owners and owners corporations / body corporates to take their disputes to the Tribunal, such as NCAT, VCAT or QCAT, which have cheap and informal procedures which keep legal costs to a minimum.
“They also have a rule that the winner is not entitled to be paid their legal costs by the loser, except in special circumstances.”
However, as Tony points out, tribunals can’t deal with some disputes and the orders they make are not as enforceable as orders made by the Supreme Court.
But in this case, where the owner of a car space was about to have access to it obstructed by works ordered by the owners corporation, NCAT could have dealt with it and so the costs were awarded against the winner
A costly lesson and if you or your committee is thinking of by-passing NCAT and going direct to the Supreme Court, you might want to read Tony’s full commentary HERE.
