Since 31 December 2007, the Victorian Civil and Administrative Tribunal, which is otherwise known as VCAT has had the power to hear Body Corporate / Owners Corporation disputes ("OC"). Prior to this all or the majority of OC disputes were heard in the Magistrates' Court of Victoria. A big part of the reason for the move to VCAT was to eliminate or minimise the issue of legal costs for people or OCs involved in such disputes as VCAT has a general position or mandate that each person to a dispute must bear their own legal costs unless exceptional circumstances apply. This is supposedly to allow the individual lot owner to air their grievances  without the worry a legal costs order to follow.

As great as this sounds that does not mean that affected persons or individual lot owners should not consider the dispute resolution process stipulated in the Owners Corporations Act 2006 and Owners Corporations Regulations 2007, which sets out a process by which grievances maybe heard. Should an aggrieved person fail to attempt to resolve the dispute prior to issuing an application in VCAT and it is determined that the aggrieved person's claim had no grounds or frivilous then it will not be uncommon for a costs order to be made against that person. Quite simply this is due to an OC being an inanimate object which requires someone to deal with the dispute and attend VCAT hearings, for which they will charge the OC for their time spent on the matter. In other words, a person should not issue a claim in VCAT where he or she has not attempted to mediate or conciliate the issue prior to the claim being issued as that person will run a much greater chance of receiving a costs order against them where they have attempted to do so in the first place.

Anthony Wilkinson  - Principal Lawyer