VICTORIAN CIVIL AND ADMINISTRATIVE TRIBUNAL
CIVIL DIVISION
BUILDING AND PROPERTY LIST	
vcat reference No. BP824/2018	
CATCHWORDS	
Victorian Civil and Administrative Tribunal Act 1998 (Vic) – ss 118 and 149 – stay of order pending outcome of an application before the Supreme Court of Victoria for leave to appeal orders made by the Tribunal – factors to consider.	

APPLICANT	Omega Building Group Pty Ltd (ACN: 107 845 974)	
RESPONDENT	Shininggarden Pty Ltd (ACN: 151 739 703)	
WHERE HELD	Melbourne, by teleconference	
BEFORE	E Riegler, Deputy President	
HEARING TYPE	Stay application	
DATE OF HEARING	29 November 2023	
DATE OF ORDER	30 November 2023	
CITATION	Omega Building Group Pty Ltd v Shininggarden Pty Ltd (Building and Property) [2023] VCAT 1369	

Order
1.	Subject to Order 2 of these orders and pursuant to s 118 of the Victorian Civil and Administrative Act 1998 (Vic), the Tribunal’s orders dated 31 August 2023 are stayed.
2.	The parties are at liberty to apply for an order to lift the stay of the Tribunal’s orders dated 31 August 2023 should circumstances change or if the Supreme Court of Victoria finds or directs that the stay be lifted. 
3.	The Tribunal’s orders dated 9 October 2023 are suspended pending further order.
4.	Liberty to apply.
5.	Costs reserved. 

E Riegler
Deputy President			

APPEARANCES:		
For Applicant	Mr M Sanger of Counsel	
For Respondent	Mr N Phillpott of Counsel	

Reasons
1.	By orders dated 31 August 2023, with accompanying Reasons, the Tribunal ordered that the respondent (‘the Owner’) pay the applicant (‘the Builder’) a total of $428,279.97, with liberty to apply for costs (‘the VCAT Order’). By application dated 2 October 2023, the Builder sought further orders that the Owner and/or the director of the Owner pay the Builder’s costs on an indemnity basis, alternatively on a standard basis on the Supreme Court Scale. As the director of the Owner is not a party to the proceeding, that application also included an application that that person be joined to the proceeding. 
2.	On or about 28 September 2023, the Owner filed an application with the Supreme Court of Victoria to appeal the VCAT Order (‘the Appeal’). It is understood that the Appeal will not be heard before the middle of 2024; with the substantive appeal to be heard immediately following the application for leave to appeal, should leave be granted. 
3.	On or about 16 October 2023, the Owner filed an application with the Tribunal, seeking an order that the VCAT Order be stayed pending the outcome of the Appeal (‘the Stay Application’). Several affidavits, supplemented by written submissions, have been filed by the parties in support of or in opposition to that application. 
4.	The Stay Application is made pursuant to s 118 of the Victorian Civil and Administrative Tribunal Act 1998 (Vic), or alternatively, s 149 of that Act. However, the parties agree that the legal principles underpinning both those provisions are substantially the same for the purposes of the Stay Application. The relevant principles are not in dispute. To that end, reference was made to the judgment of his Honour, Judge Bowman in State of Victoria v Bradto as setting out the relevant test when considering an application to stay an order of the Tribunal:
7	Whether the correct section applicable be s.118 or s.149, the same principles will apply. Consideration must be given as to whether the granting of the stay, as I shall describe it whichever section may be utilised, will render a proposed appeal nugatory. As discussed by Hollinworth J in Brown and Anor v A.E.P. Belgium S.A. and Anor [2004] VSC 255, consideration should be given to the prospect of obtaining leave to appeal, the effect of a grant or refusal of the stay, and the balance of convenience …
5.	I find that the grounds raised in the Appeal comprise complex questions concerning the construction of the building agreement between the parties and other issues concerning the conduct of the hearing before the Tribunal. The complexity of those questions and the issues raised therein reinforce the prospect of obtaining leave to appeal. However, that finding is not, of itself, determinative of the Stay Application. In my view, the effect of that finding is mitigated by the fact that the Builder has undertaken not to enforce the VCAT Order, until such time as the Supreme Court determines the Appeal. In other words, there is no risk of the Builder registering the VCAT Order and seeking to recover the judgment amount until after the Appeal (or application for leave to appeal) has been determined. 
6.	What then is the effect of a grant or refusal of the Stay Application? 
7.	According to the Owner, the affidavit material and the exhibits to that material clearly demonstrate that the Builder is in a precarious financial position, with little or no prospect of it being able to trade in the short term, if at all. Mr Phillpott of counsel, who appeared on behalf of the Owner, submitted that this leads to a reasonable inference that the judgment amount, if paid, will be dissipated because the Builder has no other means of meeting its financial commitments or obligations. Consequently, Mr Phillpott submitted that any successful appeal will be rendered nugatory. 
8.	I do not accept that proposition. In my view, there needs to be more evidence to comfortably draw that inference. However, it is unnecessary for me to further consider this submission, given the undertaking by the Builder that it will not seek to enforce the judgment amount prior to the Appeal being heard and determined.
9.	Nevertheless, Mr Phillpott submitted that this question is still relevant because a refusal to stay the VCAT Order could result in the Tribunal having to conduct a further hearing to determine the Builder’s application for costs. Mr Phillpott submitted that such a hearing would be costly, time consuming and require considerable effort, including cross-examination of witnesses, given the nature of the costs application prosecuted by the Builder. Mr Phillpott further submitted, and I accept, that the costs application has added complexity because the Builder seeks orders, the effect of which, would require the director of the Owner to effectively indemnify the Owner if it failed to pay any costs awarded against it. 
10.	On the other hand, Mr Sanger of counsel, who appeared on behalf of the Builder, submitted that there was utility in allowing the Tribunal to determine the costs application before the Appeal was heard. Specifically, he argued that a determination of the costs application may be relevant to the Builder’s application for security for costs in the Appeal proceeding, which is to be heard by the Supreme Court in January 2024. He further submitted that there is also utility in allowing the costs application to be determined prior to the Appeal because that would allow any appeal of the costs determination to be heard and determined concurrently with the substantive Appeal, should either party seek to challenge that costs determination.
11.	I do not accept that a determination of the costs application may be relevant to the Builder’s application for security for costs of the Appeal. I accept Mr Phillpott’s submission that applications for security for costs relate to prospective costs and not the costs associated with an earlier proceeding. Reference was made to the Victorian Court of Appeal judgment in Hoser & Anor v Pelley, where the Court stated:
14.	We pause to observe that the demand for the payment of the judgment debt cannot form part of the demand for security …
12.	In my view, the balance of convenience weighs against hearing the costs application prior to the Appeal being determined. I have formed that view based on several factors. First, I accept that the costs application is complex and likely to be costly and time-consuming. In my view, that factor weighs against the potential utility of the costs determination being annexed to the Appeal, should either party seek to appeal that costs determination. Second, there is no guarantee that costs will be awarded in proceedings before the Tribunal and the outcome of the Appeal; or any findings made by the Court in that proceeding, may influence how the Tribunal exercises its discretion on the question of costs (if the appeal is dismissed).
13.	Nevertheless, given the undertaking of the Builder not to enforce the judgment amount, staying the whole of the VCAT Order simply to avoid the Tribunal hearing and determining the Builder’s costs application may be seen as an overreach. On the other hand, given the Builder’s undertaking that it will not enforce the VCAT Order, it is difficult to appreciate what prejudice it would suffer if an order was made consistent with that undertaking.
14.	In my view the appropriate course, having regard to the justice of the matter, is to stay the VCAT Order, subject to either party being given liberty to apply to have the stay lifted, should circumstances change; or the Supreme Court finds that the stay should be lifted. By extension, that would require that I vacate or suspend the orders requiring the filing of material in support of or in opposition to the costs application and any orders for the hearing of that application.
15.	To that end, I note that Mr Phillpott has indicated that the Owner was poised to make an application to amend the interlocutory steps relating to the costs application to ensure that the application is heard orally with evidence being given viva voce. That will now not be necessary, at least in the short term. 

E Riegler
Deputy President