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What is the situation with legal costs?

Posted 20 May 2024

Category: NCAT and Court Proceedings, eBooks

The general position regarding legal costs in the Tribunal is that each party bears its own costs. This means that, in most cases, even if you win your matter at Tribunal, you will not be able to recover your legal costs from the other party.

However, the Tribunal may order one party to pay all or part of another party’s costs if it believes there are circumstances that justify it. These are known as special circumstances.

Some factors the Tribunal might consider include:

  • If a party has incurred additional costs because another party conducted the case in a way that unnecessarily disadvantaged the other party.
  • If the proceedings were commenced or defended without reasonable grounds.
  • If a party has refused a reasonable settlement offer.

While the general principle is that each party bears its own costs, it’s essential to approach every matter knowing that there are situations where costs can be awarded.

Please note, however, that there is only one situation in which the Tribunal may automatically award costs to a successful party without the requirement for an application for costs or the establishment of the existence of special circumstances. That is in circumstances where the amount being claimed or in dispute exceeds $30,000.00 pursuant to rule 38 of the Civil and Administrative Rules 2014.

 Further, if as an individual, you commence proceedings against the owners corporation and you are not successful with your application, you may be required to pay a portion of the owners corporation’s legal costs associated with defending the proceedings. This will be based on the unit entitlement for your property.

However, if you are successful, then you will not need to contribute towards the owners corporation’s costs with respect to the defence of the proceedings. There is an exclusion under section 104 of the SSMA which prohibits the owners corporation from levying part of its defence costs against a successful lot owner.

If you are concerned about potential costs or are considering applying for a costs order, it will be a good idea to seek legal advice to understand your position better. Bannermans Lawyers can assist further with the provision of this advice.

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This is an extract from our Bannermans NCAT Strata Disputes ebook.

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Bannermans Lawyers

Published 20 May 2024