The SAT – reluctant interstate traveller

Since its inauguration in 2005, the jurisdiction of the State Administrative Tribunal in Western Australia (SAT) has expanded exponentially to include more than 154 pieces of statutory legislation.

The appeal of the SAT as a less complex, more informal, less procedurally stringent and expedited manner of dispute resolution has gained momentum and traction among the public (self-representatives in particular) over the past few years. With the increase in the number of claims falling within the SAT’s enabling jurisdiction, our firm has noticed a marked increase in referrals that end up in the SAT. The days of confining disputes to the formal judiciary regime (and arbitrations on a less frequent occasion) are over.

A recent development has, however, dampened the way in which the SAT is able to assist those seeking its intervention and access its relatively flexible approach. The limitation is essentially when one of the parties to the dispute resides or operates from beyond Western Australia.

In brief, during 2013 and 2014, Mr Garry Burns, a resident of New South Wales (NSW), made a series of complaints to the Anti-Discrimination Board of NSW regarding statements made by Mr Bernard Gaynor, a resident of Queensland, and Ms Therese Corbett, a resident of Victoria. The matter escalated to the NSW Civil and Administrative Tribunal (NCAT) and later elevated to the Court of Appeal of the Supreme Court of NSW, where the issue arose as to whether NCAT could actually determine a claim, arising under NSW legislation, by a resident of NSW against residents of other states. In April 2018, the High Court ultimately held in Burns v Corbett (2018) HCA 15 (Burns) that NCAT did not have sufficient jurisdiction (or, more appropriately, jurisdiction whatsoever) to determine matters between residents of different states, commonly referred to as “diversity jurisdiction”. More specifically, it was held by the majority judgment that the Constitution did not allow State Parliaments to be vested with power to confer diversity jurisdiction on any tribunal by reason of it not being a “court of the State”.

As a number of our clients have disputes before the SAT on foot against persons and entities based interstate, the implications of Burns were immediately felt, and we believe its effects will present an unfortunate obstacle for a considerable period. As mentioned, our firm has seen a dramatic rise in new engagements particularly in the planning space, as well as building and construction disputes over the past two to three years.

According to the SAT’s most recent Annual Report (2017), 87% of all building applications were pursuant to the Building Services (Complaint Resolution and Administration) Act 2011 (the Act), of which 66% were referrals from the Building Commissioner regarding remedy orders, whereas applications for review from parties aggrieved by a decision from the Building Commissioner accounted for a significant component. It appears that with the general downturn in the WA economy, a substantial number of builders and contractors have sought greener economic pastures over east. It is not uncommon to experience the birth of claims for defective work and latent defects during the intervening period since the work was performed and the geographical migrations of these building entities. Accordingly, a significant number of them are pursued in the SAT – or, more accurately, were capable of being pursued before Burns.

Immediately following the aftermath of Burns it was uncertain how the SAT would be dealing with matters where one of the parties was essentially now to be considered ‘extra-territorial’.

As Burns extended to tribunals and State administrative agencies in all states and territories, the ripple effect was unavoidable. It seems that efforts are being made to address the “gap”. Recently NCAT was prepared to adopt a position in which it presents itself as a ‘court of a State’ such that it can hear matters involving diversity jurisdiction. As far as we are aware, no tribunal has followed suit. NCAT relies on a provision in the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act) which empowers NCAT to refer matters to a court if it was believed NCAT lacked jurisdiction to hear matters involving diversity jurisdiction. Section 50 of the State Administrative Tribunal Act 2004 (WA) (SAT Act) mirrors a similar provision, which relevantly provides that the SAT may make an order striking out all or any part of, alternatively refer, a proceeding if it considers that the matter would be more appropriately dealt with by another tribunal or a court. As we see it, the inherent challenge lies in the fact that such a striking out or referral of the matter encapsulates the making of an order, and to make such an order implies (or at least requires) the existence of a power to exercise the judicial authority – the very thing Burns removed.

Our firm has recently been involved in a number of disputes where we represented aggrieved property owners and contractors.  Regrettably, Burns was already in full force and effect by the time mediation had been listed in these matters, but to the credit of the presiding members the SAT was still willing to expend resources to attempt to resolve the dispute (even though it was unable to make a binding order). Accordingly, whilst the SAT’s ability to dispense judicial authority over interstate parties has been terminated, to the extent that these claims are earmarked for mediation in the near future it is worthwhile to see whether the SAT can still assist.

It is, of course, not uncommon to have multiple parties involved in a dispute before the SAT. For example, where a landlord, a tenant and the leasing agent/managing agent are all parties to a dispute – one of whom might not necessarily (or might no longer be) located within WA. In such an event, the SAT will equally lack capacity to adjudicate the matter to the extent that it relates to that party. It is thought that the SAT’s ability to act in the normal course as between the parties located within Western Australian borders will remain unaltered.

So in a nutshell, state administrative agencies, such as the SAT, do not have jurisdiction to hear matters arising between residents of different states. If you find yourself considering proceedings against an interstate person or entity, Burns might prompt the need to pursue an action in either the federal or other state courts (subject to the nature of the dispute and relief sought). In any event, we can assist you in negotiating the complexities of the legal maze.