By Nicole Wilde

13 June 2015

Litigation strategy in VCAT proceedings appears to require a ‘softer touch’ if a party wants to be able to successfully claim its legal defence costs against self-represented applicants whose VCAT applications are ‘bound to fail’.

A recent VCAT case involved self-represented lot owners and an Owners Corporation suing various repair contractors, the Owners Corporation Manager and the Owners Corporation’s strata insurer in relation to a leaking sky light at a property.

At the substantive hearing, the Owners Corporation Manager and one of the contractors were ordered to pay the Owners Corporation the sum of $2,986.75. No orders were made against the Owners Corporation’s strata insurer.

After the hearing, the insurer made an application against the lot owners and the Owners Corporation for an order that they pay the insurer’s costs in defending the proceedings. Despite implementing a number of available litigation strategy tools available under the Victorian Civil and Administrative Act 1998, including making a without prejudice settlement offer under section 112, the VCAT Senior Member hearing the costs application ultimately determined that the cover letter to the settlement offer was “…derogatory…” and “…belittling…” to the applicants in circumstances where the applicants were self-represented and therefore not in a position to interpret the letter correctly.

Accordingly, it appears lawyers defending parties to VCAT proceedings may need to re-think about how they strategically use the s.112 settlement offer strategy under the VCAT Act, even if the case against their client has no merit and is bound to fail.

Case Reference: Markessinis& Anor v D S M Coatings Pty Ltd & Ors (Owners Corporations) [2015] VCAT 50 (2 January 2015)

Related Articles

View All
Leasing & Lease Disputes / Property & Development / Property & Developers

Commercial Leases – Protect your Property

By the end of the lease (whether by expiry, abandonment or eviction) things may look different And you may need to...
Read More
Business Law / Commercial Contracts & Agreements / Litigation & Dispute Resolution

Corporate Divorce – The Importance of Prompt Damage Control

When good companies fail due to deteriorating business relationships, there is often a cast of familiar players: 1 The...
Read More
Construction / Litigation & Dispute Resolution / Property & Development

Domestic Building Dispute Resolution – New Regime

The days of VCAT being a first-instance negotiator in Victorian domestic building disputes are coming to an end...
Read More
Litigation & Dispute Resolution

Don’t be scared of a subpoena

A subpoena can be a daunting document Expressed as an order of a Court, a subpoena requires the person served to either...
Read More
Litigation & Dispute Resolution

Who Says that Compliance with a Subpoena Cannot be Profitable?

There is a price for this though A party issuing a subpoena must usually pay the reasonable expenses incurred by the...
Read More
Litigation & Dispute Resolution / Commercial Contracts & Agreements / Business Law

Handshake Agreements and the 100 million dollar bar coaster – Why it pays to speak to a litigator

In 2006 our firm successfully enforced an agreement between shareholders in an unlisted company based on nothing more...
Read More
Litigation & Dispute Resolution / Retail Clients & Chains

Keep your diary well!

One aspect which often lets businesses down when the need arises to enforce a debt is the lack of adequate details...
Read More
Litigation & Dispute Resolution

Why Mediate?

We asked Dennis to explain in his experience why people embrace the Mediation process He sets our various reasons:- 1...
Read More
Litigation & Dispute Resolution / Employment Law / Commercial Contracts & Agreements

Interference with Contractual Relations- Issues when poaching employees of a competitor.

When does an approach to ‘poach’ a person contracted elsewhere cross the line between making a lawful offer to a...
Read More