A mandatory stay of proceedings to be heard in VCAT

Case study – Impresa Construction v Oxford Building [2021] VCC 1146

In the recent decision of Impresa Construction v Oxford Building [2021] VCC 1146, the County Court of Victoria considered whether a stay of proceedings pursuant to s57 of the Domestic Building Contracts Act 1995 (Vic) (‘the Act’) can be heard by VCAT and the overarching purpose in relation to the timeliness of dispute resolution.

Her Honour Judge Burchell provided commentary on the public policy for s57 of the Act, namely that s57 of the Act is intended to provide a single, inexpensive, time-efficient and expert forum for the resolution of domestic building disputes and given the current state of under-resourcing at VCAT, this cannot be satisfied.

Her Honour observed the current VCAT website and in particular the impact COVID-19 has had on the Building and Property List. Her Honour commentated that currently, the public policy rationale behind s57 of the Act appears to be frustrated stating that:

“Allowing mandatory stay of proceedings to be heard in VCAT where there is a shortage of resources to meet the backlog of matters, where:

(a)   timelines do not apply;

(b)   VCAT will contact the parties 8-10 weeks from initiation with the proposed next steps;

(c)   currently listed hearings fixed from October 2021 are being vacated and presumably refixed in priority of new initiations to ensure that adjourned hearings are heard within a reasonable timeframe; and

(d)   where interlocutory hearings are being fixed some 8 months into the future,

all subvert the purpose of both the Act and the CPA to enable timely and cost-effective dispute resolution.”

There was further discussion that VCAT is experiencing delays in its hearings because of the sheer volume of matters being brought before the Tribunal during COVID-19 and the slow transition to remote hearings. Her Honour specifically noted [at paragraph 48 of the judgement] that:

As at 30 April 2020, approximately 400 VCAT matters were adjourned, with VCAT venues (including VCAT counters) closed to the public and no face-to-face hearings being scheduled.”

In May 2021 Deputy President Aird announced her retirement. Deputy President Aird created a legacy to improve efficiencies and case management procedures in the Building and Property List, and it is bittersweet to see such legacy be diminished through the effects of COVID-19 and lack of resources.

Her Honour emphasised that a proceeding stayed and heard at VCAT is impossible for a timeliness of resolution. It is clear that more needs to be done to make it possible for VCAT to fulfil its role in providing an accessible, efficient and low-cost tribunal by ensuring it can provide a timely service in the resolution of parties’ disputes, and by doing so at the moment this can only be achieved if appropriate resources are allocated towards the proper functioning of the Tribunal.

Further, Her Honour commented [at paragraph 20 of the decision] that in the meantime, in circumstances where: (a) a party does not promptly commence proceedings in VCAT and/or (b) there is an inordinate delay in VCAT’s ability to hear the proceeding, the parties can apply to lift any stay granted by this Court pursuant to s57 of the Act. Another alternative is to seek an order under s77 of the Victorian Civil and Administrative Tribunal Act 1998 (Vic) to globally refer matters back to the County Court.

It will be interesting to see how many parties elect to have their matter heard in the County Court as opposed to the VCAT.  Whilst there are obvious time benefits to having the matter heard in the County Court, a party will have to weigh up the costs of having the matter heard in the County Court as opposed to the Tribunal.

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