VICTORIAN CIVIL AND ADMINISTRATIVE TRIBUNAL
civil DIVISION
OWNERS CORPORATIONS LIST	VCAT REFERENCE NO. OC1425/2022
CATCHWORDS	
Application for costs. Victorian Civil and Administrative Tribunal Act 1998 sub sections 109(1)(a), (c) and (e). Owners Corporations Act 2006. Issues in costs application not established. Procedural irregularities.	

FIRST APPLICANT	Mr David Bird	
SECOND APPLICANT	Maria Pope	
FIRST RESPONDENT	Owners Corporation No. 1 PS641011U 	
SECOND RESPONDENT	Owners Corporation No. 2 PS641011U	
WHERE HELD	Melbourne	
BEFORE	Dr R Leshinsky, Member	
HEARING TYPE	On the papers costs application 	
objecting party written submissions due	10 March 2023	
DATE OF ORDER	27 March 2023	
CITATION	Bird v Owners Corporation No 1 PS641011U (Owners Corporations) [2023] VCAT 328	

Order
The costs application is dismissed. 

Dr R Leshinsky 
Member			

Reasons
1	John Chau and Guardian Strata Management Services Pty Ltd (GSMS), who are not parties to this proceeding, are seeking costs from the applicants, Maria Pope and David Bird. 
2	John Chau is an owners corporation manager and acting on behalf of GSMS. 
3	In Chambers Orders dated 12 December 2022 allowed for written submissions in favour and opposing any costs application. 
4	The original first respondent was:
The IKON c/o Guardian Strata Management Services Pty Ltd (PS641011U OC1).
5	The original second respondent was:
The IKON c/o Guardian Strata Management Services Pty Ltd (PS641011U OC2).
6	Maria Pope and David Bird put in written submissions. Based on the written submissions from John Chau and GSMS, and Maria Pope and David Bird, I find no costs are to be awarded. I will make an order for the costs application to be dismissed. My reasons follow.
What is the costs application about?
7	The application in OC1425/2022 was originally made against The IKON c/o Guardian Strata Management Services Pty Ltd. It is not uncommon in an owners corporation proceeding for applicants to name the respondent as the building itself and/or the property management company, and for self-represented litigants to misunderstand that the owners corporation is in fact the proper legal entity for the proceeding. Misnaming a party is a procedural irregularity.
8	A directions hearing was listed for 28 October 2022. The applicants both appeared and were self-represented. At the directions hearing, I explained to Maria Pope and David Bird, they need to consider who is the correct respondent. In my orders dated 28 October 2022, I put in a background note stating:
The applicants must consider who are the legally correct respondents in this proceeding as there are serious consequences, including legal costs concerns, when incorrect respondents are brought into litigation.
9	I understand in the development there are four owners corporations being Owners Corporations Nos. 1-4 PS641011U. At the first directions hearing these four owners corporations were represented by Mr Mermelstein, a legal practitioner. There was no appearance for the original respondents The IKON c/o Guardian Strata Management Services Pty Ltd. 
10	Mr Mermelstein informed the Tribunal that an annual general meeting was part-held on 6 October 2022, and interim special resolutions were passed at that meeting, and those interim special resolutions were to become special resolutions on 4 November 2022.
11	There being no objection from the applicants, and at the request of Mr Mermelstein, the Tribunal listed the proceeding for a further directions hearing after 4 November 2022, to allow for the interim special resolutions to take their course.
12	At the directions hearing on 22 November 2022, there was no appearance by the applicants. Owners Corporations Nos. 1 and 2 PS641011U were represented by Mr Mermelstein who asked for the original first and second respondents to be substituted by Owners Corporation No. 1 PS641011U as first respondent, and Owners Corporation No. 2 PS641011U as second respondent. Mr Mermelstein put to the Tribunal that the applicants did not object to the substitution. There was no representation at the second directions hearing for the respondents originally named (The IKON c/o Guardian Strata Management Services Pty Ltd).
13	Mr Mermelstein sought a further order that the proceeding be struck out as the parties were in discussion to resolve the proceeding.
14	I made orders to strike out the proceeding with the right to apply for reinstatement. 
15	To date, the proceeding has remained struck out with the right to apply for reinstatement.  No reinstatement application has been made by any of the parties. John Chau and GSMS filed their application for costs on 31 January 2023 without expressly seeking reinstatement of the proceeding. That is also a procedural irregularity. 
The assessment of costs
16	Mr Chau in written submissions set out his grounds for a costs application against the applicants based on Maria Pope and David Bird having:
(a)	vexatiously conducted the proceeding;
(b)	made claims that have no tenable basis in fact; and 
(c)	breached the Owners Corporations Act 2006.

17	Maria Pope and David Bird put in written submissions in response. Much of their submissions are an attack on Mr Chau’s conduct and performance as the owners corporations’ manager. 
18	Having regard to the criteria in subsections 109(3)(a), (c) and (e) of the Victorian Civil and Administrative Tribunal Act 1998 (Vic), I am not satisfied that it would be fair to order the applicants to the pay the costs of John Chau or GSMS, even if John Chau and GSMS had standing to make the application.
19	The power to award costs is conditional in that it may not be exercised by the Tribunal unless it is fair to do so (see for instance, Chiropractic Board of Australia v Hooper [2013] VCAT 236 at [60]). The word fair in this context has been interpreted to mean “just or appropriate” in the circumstances (Filippou Management Pty Ltd v MREEF Project Company No. 11 Pty Ltd [2010] VCAT 1261 at [20]; Owners Corporation No. 1 PS 542645C v Filippou Management Pty Ltd [2010] VCAT 2085 at [34]).
20	John Chau was never a party to these proceedings. Further, there was no appearance by GSMS at either of the directions hearings. At the second directions hearing, GSMS was removed as a party and Owners Corporations Nos. 1 and 2 PS641011U were substituted as respondents. There has been no application to reinstate the original respondents as parties to this proceeding. Further, there has been no interlocutory or final hearing to test whether the applicants, as Mr Chau claims, had in fact:
(a)	vexatiously conducted the proceeding;
(b)	made claims that have no tenable basis in fact; or
(c)	breached the Owners Corporations Act 2006.
Conclusion
21	I find Mr Chau’s application for costs misconceived in relation to his own costs. Mr Chau is and was never a party to these proceedings. Nor has he applied to be joined as a party. For costs claimed on behalf of GSMS, and even for Mr Chau, the Tribunal has not had any opportunity hear any submissions or evidence on the substantial issues in this proceeding which makes it impossible to determine whether Maria Pope and David Bird vexatiously conducted the proceeding, made claims with no tenable basis in fact or even breached the Owners Corporations Act 2006 (Vic). Accordingly, the Tribunal cannot make a fair assessment for costs, which is just or appropriate, in relation to these issues. 
22	Under these circumstances, it is not fair for the Tribunal to make a costs order against Maria Pope and David Bird. Accordingly, I will make orders to dismiss the costs application. 

Dr R Leshinsky 
Member