Procedural Background

Between 7 and 10 February 2020, the apartment of Hua Nan Trading Pty Ltd (‘Hau Nan’) flooded.

On 2 February 2022, Hau Nan attempted to commence proceedings against the Owners Corporation for an alleged breached of section 106(4) of the Strata Schemes Management Act 2025 (NSW) (‘SSM Act’). The limitation period to file proceedings is two years,[1] with the expiry date being 5 February 2022. When filing, Hua Nan completed a ‘Strata and Community Schemes Application’, (‘First Application’) being the standard form used to commence strata proceedings at NCAT. The application requires applicants to answer, “have you tried to settle this dispute through mediation”, to which Hua Nan selected “no”. When providing the reason why he had not done so, Hua Nan wrote: “I making insurance claim. It has not been resolved yet. For the time bar is on, before 05/02/2022. Claim the insurance doesn’t request it.”

The Registrar decided to disallow the First Application. This was done on the basis that the mediation requirements of section 227 of the SSM had not be satisfied. The Registrar informed Hau Nan that a new application should be submitted after mediation was complete. On 22 April 2022, NSW Fair Trading conducted mediation between Hau Nan and the Owners Corporation. The mediation was unsuccessful. Then, between April and May 2022, Hau Nan filed an identical application (‘Second Application’).

On 9 November 2022, the Second Application was heard (‘First Decision’). On 11 November 2022, the Tribunal dismissed the application on the basis that the 2-year limitation period had expired. The Tribunal stated that section 41 of the Civil and Administrative Tribunal Act 2013 (‘NCAT Act’)[2] does not allow the Tribunal to extend time against section 106(6) SSM.

Hau Tan appealed the First Decision (‘First Appeal’), which was decided on 6 March 2023.[3] The decision was that the Tribunal does “have power to extend time for the bringing of proceedings for damages, and therefore the Tribunal’s decision should be set aside, and the proceedings remitted to the Tribunal to be re-determined”.[4]

The hearing (‘Second Decision’) occurred on 20 September 2023, with the decision being given on 17 November 2023. The Tribunal again declined to extend the time and dismissed the application.

On 12 December 2023, Hua Nan lodged another appeal (‘Second Appeal’), which was heard on 25 March 2024 and decided on 28 June 2024. The Appeal Panel decided, following the decision of Owners - Strata Plan No 30691 v Pickard [2024] (‘Pickard’),[5] that the First Appeal Decision was “plainly wrong” and that the Tribunal does not have power to extend the limitation period.

Implications

The decision in Hau Tan, and Pickard, strikes at the fundamental principles by which NCAT is governed and the objectives it attempts to achieve. For example, section 38 of the Civil and Administrative Tribunal Act 2013 (NSW)[6] states that NCAT should act with “as little formality as the circumstances of the case permit and according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms”. Section 41 states that “the Tribunal may…extend the period of time for the doing of anything under any legislation in respect of which the Tribunal has jurisdiction despite anything to the contrary under that legislation”.[7]

Both sections appear to give NCAT the power to ignore the ‘technicality’ which took place in this case and extend the limitation period. Indeed, it appears the tribunal gave greater importance to legal technicality and formality, than on equity and good conscience.

How will these decisions affect future cases moving forward? Despite the tribunal’s decision and approach, it is unlikely future cases will be required to follow this precedent in ‘never’ allowing the tribunal to extend a limitation period. Instead, the Tribunal will first determine the merits of the case before extending the limitation period. In this case, Hau Tan has a very “weak” case and was unlikely to succeed, which led the tribunal to decline granting an extension.

Key Takeaways

Persons seeking to lodge applications to NCAT should beware of legal technicalities that may impeded their case. The Tribunal does have powers to assist in the pursuit of equity and good conscience, however, these powers are discretionary and should not be relied upon. The best course of action is to satisfying legal requirements with completeness and precision.

Footnotes

[1] Strata Schemes Management Act 2025 (NSW) s 106(4).

[2] Civil and Administrative Tribunal Act 2013 (NSW) s 41.

[3] Hua Nan Trading Pty Ltd v The Owners – Strata Plan No 32396 [2023] NSWCATAP 66.

[4] Hua Nan Trading Pty Ltd at [4].

[5] Owners - Strata Plan No 30691 v Pickard [2024] NSWCATAP 126.

[6] Civil and Administrative Tribunal Act 2013 (NSW) s 38.

[7] Civil and Administrative Tribunal Act 2013 (NSW) s 41.