Portico Signage Dispute Leads to VCAT Costs Order

Body Corporate No. 1 Plan No. PS431905W v The First East Auction Holding (Retail Tenancies) [2008] VCAT 1546

GoStrata’s CaseWatch is a short, sharp and easy-to-understand review of important and interesting Court and Tribunal decisions affecting Australian strata title stakeholders.

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Quick Read

This 2008 VCAT decision is about a dispute in a Prahran strata title building over a sign above an entrance portico between tenants under common property licences that dragged them and the strata building into litigation. Despite the case involving arguments about the sign locations and tenants conducted, VCAT only had to decide about costs orders when one tenant removed their Aveda sign at the last minute.  After considering the facts, the licence, cost provisions applying to VCAT and the parties’ conduct, VCAT overturned the default position and said it was ‘fair, that the tenant that installed and removed the sign pay the other tenant’s and the strata building’s costs.  It’s a great reminder that how parties conduct cases can affect their exposure to cost orders and what VCAT will consider in those situations.

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Implications

The key implications of this strata case are as follows.

• The default position at VCAT is that parties pay their own costs.

• But VCAT can still order costs if it’s ‘fair’ under s 109(2) and s 109(3).

• The relative strengths of the parties’ cases are an important factor.

• In this case, the case was ‘strongly in favour’ of one party.