Schrödinger’s VCAT: both a court and not

Is VCAT a court? Yes and no, the Court of Appeal ruled in Subway Systems Australia Pty v Ireland [2014] VSCA 142. The case was about a Subway restaurant franchise arrangement, including an arbitration agreement to deal with any disputes that arose. The Commercial Arbitration Act 2011 (Vic) prevents “a court” from hearing a matter that is covered by an arbitration agreement. The franchisees tried to take a retail tenancy dispute to VCAT, but Subway objected. The Court of Appeal majority judges held that parliament intended the law to “prefer[] arbitration of whatever kind has been agreed between the parties over State sponsored dispute resolution”, and the word “court” should be interpreted broadly in this context. So VCAT is usually considered to be a tribunal, but in some specific situations it is treated as if it was a court.