Out of State means out of order?

Both State and Federal governments have a new-found passion for “specialist Tribunals” as opposed to Courts.  Talk of such a Tribunal has abounded in discussions around the scandals affecting the financial advisor and banking industries.

In New South Wales we have the Civil and Administrative Tribunal (or NCAT), which has a broad range of matters under its purview including home building, tenancy, guardianship, administrative appeals and occupational regulation.

It seems that the politicians like “tribunals” as opposed to good old-fashioned Courts because they give the pollies to bash lawyers a bit.  Tribunals are often badged as quicker, less formal and targeted towards allowing people to represent themselves.

In practice it’s our experience that Tribunals aren’t quite the panacea the politicians imagine them to be.  Whilst they are great at dealing with disputes with a relatively low monetary value, the attributes of informality can become a handicap when disputes of a greater value come about.

By way of example the home building jurisdiction of the NCAT extends to $500,000.  I would imagine there would be very few people willing to represent themselves in a dispute over that amount of money.  I would also imagine that parties in that size a dispute would draw comfort from the rigorous application of the rules of evidence.

The recent case of Zistis v Zistis in the Supreme Court of New South Wales was interesting for a number of reasons.

The dispute was between two brothers, the plaintiff who is 81 and living in Queensland and the first defendant who is 74.  The plaintiff owns a property in Kensington, which the defendant had been living in.  The plaintiff said that the defendant was renting the property from him.  By contrast the defendant said that the plaintiff could stay there for as long as he wanted, and that he would be leaving the property to the first defendant and their sister.

The first defendant spent a not insubstantial amount of money on renovations to the property.  He says he did this because of the promises made to him by the plaintiff.  Alternatively, the first defendant wanted to be paid for the renovations and the value of his life estate before he would move out.  The plaintiff denied such promises, and eventually took action in NCAT to have the first defendant evicted so that the plaintiff could sell the property.

The Tribunal application was dismissed for want of jurisdiction and the proceedings in the Supreme Court commenced.  We will get to why in a minute.

Justice Latham did not believe the evidence of the first defendant.  There were a number of glaring inconsistencies in his evidence, which led Her Honour to the conclusion that “the inference that the defendant fabricated the testamentary promise by the plaintiff is justified”.  An excruciatingly polite way of saying he was lying.  The Court ordered vacant possession be given.

The Court also gave judgment on the jurisdiction of NCAT.  The question arose because the plaintiff was resident in Queensland, not NSW.  In those circumstances whether or not NCAT had jurisdiction depended on whether it was exercising judicial power, and was a Court of the state.

The Supreme Court found that NCAT was purporting to exercise judicial power, but that it was not a Court of the state.  For those reasons it found that sections 81, 83, 85, 187, and 119 of the Residential Tenancies Act were invalid with respect to residents of different states.

So to the morals of the story.  First is whenever you have an agreement with someone, whether they are related to you or not, at the very least you should get it writing, but when it’s regarding something as important a piece of property you should see a lawyer.

The second is less of a moral and more perhaps of an opinion.  We have three Courts, the Supreme, District and Local, with their jurisdiction being divided primarily along financial lines.  Instead of trying to create specialist tribunals (which by the way are doing a great job within their parameters), perhaps it would be best if governments focussed on adequately resourcing the Courts we already have in place.  They are after all in existence for the very purpose of determining disputes and are of a standard that we should all be proud of.  Bouncing between different Courts and Tribunals is no one’s idea of fun, not even a lawyer’s.