The downside of procedural flexibility and informality: The mental gymnastics of NCAT

The anticipation was that NCAT would exclusively decide on those matters which comprise “all functions of government”[1] and have a “reduced emphasis on legal technicality, offering litigants the opportunity to present their own cases, without disadvantage and without the need to retain legal practitioners to act on their behalf.”[2]

The recent decision of SP 95221 v Lane Cove Council [2025] NSWSC 172 (“this Decision”), handed down by Slattery J, identified that, by being flexible and informal in respect of its rules, NCAT can detract from, rather than attract to, “prompt, affordable and accessible justice.” In this Decision, it was notable that the Tribunal Registry (“the Registry”), even at the application stage, prevented an applicant from filing an application on the basis of “an incorrect test that omitted them.”

This refusal to accept the application had significant consequences with respect to limitations; denying the applicant procedural fairness which ultimately necessitated an appeal to the Supreme Court that would have been wholly unnecessary, had proper procedure been followed. This case illustrates the impacts of failed attempts by the tribunal to achieve “prompt, affordable and accessible justice.” Paradoxically, this detracted from the principal aim of the Tribunal to encourage “lay and community representatives in decision making.”

A misreading of statute and a departure from precedent

This case is in respect of a minor building defects dispute, where The Owners – Strata Plan No. 95221 (“the Owners”), an owners corporation of a residential apartment complex, attempted to file a claim with NCAT against the builder and the developer for breaches of the statutory warranties pursuant to sections 18B to 18D of the Home Building Act 1989 (NSW) (“HB Act”). Notably, the developer was the local council.

Upon filing for application, significant issues with the conduct of the Registry arose and were later identified by Slattery J. The initial application of the Owners to the Tribunal was rejected on an incorrect application of the HB Act section 48J and Direction 5, at [129]. These provisions control the acceptance of a building defect claim, of which there are of two conditions, either:

• the principal registrar is satisfied that the “subject matter of the building claim has been investigated under [HB Act Part 3A] Division 2” (this is pursuant to section 48J of HB Act); or
• the President of the Tribunal “directs that the building claim be accepted without such an investigation being made”, at [90].

In respect of the latter, Direction 5 expressly, at (4)(d), allows acceptance of “claims where the time for lodging a claim is due to expire within three months.” As stated by his Honour, the reason for this category is obvious:

“Such a category is necessary because it is not difficult to foresee that for HB Act s18E(1)(b) defects that are not major defects, attracting a two-year warranty period starting on completion of the work (HB Act s18E(1)(c)) that the commencement and completion of the investigation may well take longer than the warranty period”, at [93].

It should be noted that had the damages for the claim exceeded $500,000, pursuant to section 48K of HB Act, the matter would have been filed with the District Court. Under this process, an applicant can just file the claim without requiring the Division 2 investigation. For the Tribunal to require a higher standard of their applicants than the District Court, would seem to contradict the need for broader legal accessibility for which NCAT was created to fulfil.

The Owners lodged their application on 22 December 2018, the day before the expiry of the two-year limitation period for minor defects. Whilst it was disputed by the parties as to when the two-year period accrued, i.e. whether the interim occupation certificate date accrued for the whole or only part of the building works (c.f. [115] – [118]), it was found by his Honour that:

“In the Court’s view (a) the Owners Corporation’s submission about the effect of the interim occupation certificate is reasonably arguable, and (b) that is all that the Owners Corporation is required to show to gain the prerogative relief it seeks”, at [119].

As identified in the judgment, the impending time limitations should have engaged Direction 5 (4)(d), from which it should have been inferred by the Registry that the Owners’ application was entitled to be accepted under the consideration of the President without “[the Division 2] investigation being made.” Despite this, the Registry stated in a series of email correspondence that without the defects having been investigated, pursuant to Division 2, the “registrar must not accept an application.”

On 23 January 2019 an email was sent to the Owners, who were legally represented, at [38]:

“As this was not presented to NCAT within the allocated timeframe, namely 15-JAN-2019, your application was dismissed. You may wish to lodge a new application with appropriate documentation. Alternatively, you may wish to seek your own independent legal advice. Please refer to the attached document “Getting Help” for your review.”

Despite a further response from the Owners legal representatives to the Registry, noting the limitations, the Registry sent a final letter stating on 31 January 2019: “as the documentary evidence [of an investigation] has not been provided, your application cannot be accepted, and the file has now been closed.” In respect of these correspondences his Honour found the Registry was fundamentally “unmoving” [41] in an incorrect application of the law:

“In the Court’s view the Registrar failed to take into account those relevant considerations and erred in law applying an incorrect test that omitted them. Moreover, the Registrar also denied the Owners Corporation procedural fairness in denying it an opportunity to advance an argument based on Directive 5(4)(d)” at [129] (emphasis added).

Further identified by his Honour, at [130], was that NCAT’s standard application form “was structured to invite NCAT applicants to present to the Registry any considerations that may impair their capacity to communicate with NCAT.” The nominated special needs of the Owners, identified as the upcoming expiry of limitations period, was disregarded by the Registry and was not directed to the President of NCAT for consideration.

His Honour did give consideration as to whether the limited capacity of the Tribunal President made it impractical to respond to requests pursuant to HB Act section 48J and Directive 5, with his Honour identifying it as an additional point of concern, at [92]. His Honour observed that in this case, the Registry made no attempt to contact the President but rather proceeded to impose a time limit on the Owners to respond with the relevant expert evidence. This limit was characterised by the Owners’ legal representatives as “arbitrary only and is not imposed by either the Procedural Direction or the Civil and Administrative Tribunal Act 2013 or the Home Building Act” at [40] (emphasis added).

This time limit additionally failed to accommodate for the automatic email replies given in response to correspondence from the Registry over the holiday period, meaning that the file was closed even before the Owners had capacity to respond and accommodate the request for expert evidence. In any case, an appropriate application of Direction 5 (4)(d) would have rendered such correspondence unnecessary.

His Honour ultimately found in favour of the Owners, with the Court making a mandamus order to NCAT, stipulating that it accept the Owners’ application of 22 December 2018. None of these complications would have been likely to arise had the application exceeded NCAT’s jurisdictional limit and had been filed at the District Court. Unlike NCAT, this jurisdiction does not have the same controls for accepting building defects claims.

Conclusion

Practitioners should take note of the importance of organising and preparing evidence well in advance and to avoid over reliance on the capacity of the Tribunal to accommodate the circumstantial needs of applicants. When making an application to preserve time at NCAT, practitioners should emphasise as much as possible that that is the purpose of the application.

Beyond the practical implication, a greater concern that emerges from this case is in respect of the administration of the Tribunal. Whilst the Tribunal was established to be flexible and determine its own procedure and conduct without regard to technicalities or legal forms, as it can be observed in this Decision, it is possible such flexibility detracts from the rules of natural justice and procedural fairness, c.f. section 38 Civil and Administrative Tribunal Act 2013 (NSW). As stated by Wright J, when NCAT was founded:

“NCAT has inherent in it the tension between a great ideal: prompt, affordable and accessible justice; and, the difficulties of implementation in the real world. The importance of getting the tribunal system right cannot be understated since, for many in New South Wales, NCAT is the primary means they have of obtaining access to justice, of having their complaints and issues heard and of receiving the help that they need.”[3]

Whilst the Tribunal has been successful in arriving at the correct balance in navigating this “tension” in most cases, this Decision illustrates that this balancing act is a continuing work for which all participants in the Tribunal, but particularly legal practitioners, ought to be vigilant and steadfast.

Matthew Lo is Special Counsel with Kerin Benson Lawyers Pty Ltd and a member of the Law Society of NSW’s Business Law and Costs Committees. Sophie Barbour is Paralegal with Kerin Benson Lawyers Pty Ltd.

[1] Justice Robertson Wright, ‘Launch of the Civil and Administrative Tribunal of New South Wales’ (Speech, NSW Civil & Administrative Tribunal, 29 January 2014) 

[2]Justice Robertson Wright, ‘An Overview of the NSW Civil and Administrative Tribunal’ (Speech, The College of Law Litigation Breakfast Series, 3 March 2015) at [50] <https://ncat.nsw.gov.au/documents/speeches/speech_overview_of_nsw_civil_and_administrative_tribunal.pdf>.

[3] Justice Robertson Wright, ‘Launch of the Civil and Administrative Tribunal of New South Wales’ (Speech, NSW Civil & Administrative Tribunal, 29 January 2014) [12] <https://supremecourt.nsw.gov.au/documents/Publications/Speeches/Pre-2015-Speeches/Wright/wright_20140129.pdf>.