[2015] HCA 40
Minister for Immigration and Citizenship v SZMDS [2010] HCA 16
Minister for Immigration and Multicultural Affairs v Eshetu 197 CLR 61
[1991] HCA 32
Re Minister for Immigration and Multicultural Affairs
Ex parte Applicant S20/2002 77 ALJR 1165
[1986] HCA 54
Stephens v The Queen [2022] HCA 31
Suvaal v Cessnock City Council (2003) 77 ALJR 1449
Source
Original judgment source is linked above.
Catchwords
[2015] HCA 40
Minister for Immigration and Citizenship v SZMDS [2010] HCA 16
Minister for Immigration and Multicultural Affairs v Eshetu 197 CLR 61[1991] HCA 32
Re Minister for Immigration and Multicultural AffairsEx parte Applicant S20/2002 77 ALJR 1165[1986] HCA 54
Stephens v The Queen [2022] HCA 31
Suvaal v Cessnock City Council (2003) 77 ALJR 1449Australian Competition And Consumer Commission v Theo Holdings Pty Ltd [2000] FCA 665
Judgment (35 paragraphs)
[1]
Background
On 2 December 2022, the Tribunal determined competing applications between the parties to these proceedings. To understand the decision, it is first necessary to understand the nature of the dispute and the respective roles of the parties.
The parties were as follows:
1. Actol Pty Ltd (Actol) was the owner of land at Kellyville which it sought to develop by constructing four separate dwellings on the land;
2. Peter Wakefield (Mr Wakefield) was a director of Actol,
3. Rise Products Pty Ltd (Rise) was the manufacturer of a prefabricated concreting formwork system, with some apparently novel features, that was exclusively used in the construction on the land (the "Risewall product");
4. Daniel Pszczonka (Mr Pszczonka) was a director of Rise;
5. Benth Holdings Pty Ltd t/as Gledswood Projects (Benth) was a company engaged in providing building services and which performed some construction on the site using the Risewall product;
6. 3 Form Structures Pty Ltd (3Form) was a company engaged in providing building services and which performed some construction on the site using the Risewall product.
Actol alleged that the Risewall product used in the construction of the four dwellings was defective and sought compensation for the cost of rectifying the defective formwork, damages for delay in the completion of the project (assessed by reference to the interest paid on a loan taken out by Actol to finance the project), and the repayment of half the sum paid (in advance) by Actol to Rise representing the cost of Risewall product not delivered.
The amount sought by Actol was $476,321.56, consisting of rectification costs of $278,133.56, interest payments of $198,208, and "return of overpayment" of $50,650.
Actol alleged that Rise contracted with it to supply and install the Risewall product and that Rise breached the statutory warranties incorporated into that contract by s 18B of the Home Building Act 1989 (NSW) (HBA). In the alternative, Actol alleged the Risewall product did not satisfy the consumer guarantees provided by ss 54, 55, 56, 57, 58, 60, 61 and 62 of the Australian Consumer Law (NSW) (ACL) as that is applied through the FTA and that Rise, via Mr Pszczonka, engaged in misleading and deceptive conduct in breach of s 18 of the ACL.
Rise disputed that it contracted to install the Risewall product. It alleged that Actol initially contracted separately with 3Form, and later Benth for the installation of the Risewall product. It, together with Mr Pszczonka, denied any allegation of misleading and deceptive conduct.
In light of Rise's assertion that Actol had contracted with 3Form and Benth for the installation of the Risewall product, Actol joined 3Form and Benth to the proceedings and sought compensation from 3Form and Benth for breach of statutory warranties.
In the alternative to its claim that Rise had contracted with Actol to install, as well as supply the Risewall product, Actol alleged that Rise had contracted with Actol to act as either the coordinator or supervisor of the installation of the Risewall product, pursuant to a "supervision contract" which also incorporated statutory warranties, and that Rise had breached the statutory warranties in the performance of the supervision contract.
Rise also brought a separate application against 3Form and Benth for contribution and indemnity by reason of alleged breaches of duties of care arising pursuant to the Design and Building Practitioners Act 2020 (NSW) and the common law.
During the proceedings, the Tribunal received notification that 3Form had gone into voluntary liquidation. Pursuant to s 500 of the Corporations Act 2001 (Cth), the applications could not proceed against 3Form without the leave of a Court. As a result, both Actol and Rise withdrew their applications insofar as they sought relief against 3Form and 3Form ceased to be an active party to the proceedings.
Ultimately, the Tribunal decided that Rise contracted with Actol to supply, and not to install, the Risewall product.
It also found that Actol did not acquire the Risewall product as a consumer and its claim for breach of the consumer guarantees under the ACL should fail.
In the alternative, it determined that a breach of ss 54 & 55 of the ACL had been established, in that the Risewall product was not of acceptable quality or reasonably fit for any purpose made known to Rise by Actol and any purpose for which Rise had represented the goods would be reasonably fit. However, the Tribunal went on to find that the defects in the finished walls constructed using the Risewall product were not a foreseeable consequence of the failure of the Risewall product to comply with the consumer guarantees. Accordingly, the only damages recoverable by Actol would have been compensation for the delay in completion of the buildings but Actol had not met its evidentiary burden sufficiently to enable the Tribunal to assess the damage suffered by Actol through the delays to the construction of the four houses caused by the supply of the defective product. The Tribunal also found that the evidence led on that issue by Actol was not reliable, and lacked detail and cogent reasoning.
Actol's misleading and deceptive conduct claims were, likewise, found not to be made out on the evidence. As a result, it was not necessary to consider whether that the claim was apportionable and whether 3Form or Benth were concurrent wrongdoers.
The Tribunal dismissed Actol's alternative claim that Rise had contracted with Actol to supervise Benth's or 3Form's installation of the Risewall product.
The Tribunal determined that Actol's claim for reimbursement of the cost of product not delivered by Rise should be allowed under s 79J of the FTA and should be quantified in the sum of $50,650.60.
Despite the Tribunal's jurisdictional monetary limit of claims under the FTA being $40,000 at the time the proceedings were commenced, the Tribunal accepted that the, subsequently amended, limit of $100,000 was applicable. It therefore allowed the claim in full being the sum of $50,650.60.
The Tribunal later determined that Actol should pay Mr Pszczonka's costs of defending the claim against him, incurred independently to those costs incurred by Rise, and made no further order as to costs with the effect that the parties were otherwise to pay their own costs of the proceedings.
Actol appealed on various grounds against several findings made by the Tribunal, and its determination as to costs to the extent it relies upon those findings. The active respondents were Rise and Mr Pszczonka. As they were commonly represented and no separate issue about Mr Pszczonka's involvement arises in the appeal, we will not refer to him separately. No disrespect is intended. Benth played no active role in the appeal.
Rise appealed solely from the finding that the applicable monetary jurisdictional limit was $100,000 and not $40,000. If it succeeded on that issue, the primary decision could simply be varied to reduce the sum it was ordered to, and had, paid Actol by $10,650.60. That is the difference between the judgement sum and the jurisdictional limit of $40,000 that applied when the proceedings were commenced.
After discussing some preliminary matters, we shall first decide the Rise appeal in the reasons given below before turning to the Actol appeal.
[2]
Scope and nature of internal appeals
To succeed in an appeal, the appellant must demonstrate either an error on a question of law, which, except in an appeal from an interlocutory decision, may be argued as of right; or that permission (that is, "leave") to appeal should be granted to bring the appeal: Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act), s 80(2).
The principles governing an application for leave to appeal under the NCAT Act are well-established and are repeated in many decisions of the Appeal Panel, often quoting Collins v Urban [2014] NSWCATAP 17. They are the same principles applied by the courts. It is enough as a summary to refer to the Secretary, Department of Family and Community Services v Smith [2017] NSWCA 206, where the Court said at [28] (citations omitted):
Only if the decision is attended with sufficient doubt to warrant its reconsideration on appeal will leave be granted. Ordinarily, it is only appropriate to grant leave where there is an issue of principle, a question of general public importance, or an injustice which is reasonably clear, in the sense of going beyond what is merely arguable. It is well established that it is not sufficient merely to show that the trial judge was arguably wrong.
Where, as here, the appeal is from a final or ancillary decision made in the Consumer and Commercial Division, there is a further qualification to the possible grant of leave in that we may only go on to consider a grant of leave in the broader sense if we are first satisfied that the elements of cl 12(1) of Sch 4 of the NCAT Act are made out, in that the appellant may have suffered a substantial miscarriage of justice on the basis that:
1. the decision of the Tribunal under appeal was not fair and equitable; or
2. the decision of the Tribunal under appeal was against the weight of evidence; or
3. significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with).
We agree with the Appeal Panel in Collins v Urban where it said, at [76], that a substantial miscarriage of justice for the purposes of cl 12(1) of Sch 4 of the NCAT Act may have been suffered where:
... [T]here was a "significant possibility" or a "chance which was fairly open" that a different and more favourable result would have been achieved for the appellant had the relevant circumstance in para (a) or (b) not occurred or if the fresh evidence under para (c) had been before the Tribunal at first instance."
We may decide to conduct a new hearing if we are satisfied that the grounds for appeal warrant it: NCAT Act, s 80(3)(a). A new hearing under s 80(3) of the NCAT Act is a hearing de novo, or "from the beginning": Yuen v Thom [2016] NSWCATAP 243 at [17]. Neither party suggested that course was appropriate here and the grounds of appeal did not warrant it.
[3]
An Appeal commenced out of time.
The appeal by Rise was not commenced within time.
The Notice of Appeal records that Rise received the Tribunal's reasons for decision on 2 December 2022. The Appeal was not lodged until 23 February 2023, well beyond the 28 days allowed for filing the notice under Rule 25(4)(c) of the Civil and Administrative Tribunal Rules 2014 (NSW). We may, though extend time for filing the Notice of Appeal: NCAT Act, s 41.
In Kelly v Szatow [2020] NSWSC 407, the Court summarised the principles that apply to an extension of time to appeal. Relevant considerations include the length of the delay and any associated reasons for such, the strength of the appellant's case and consideration of whether the respondent would be prejudiced by the granting of the application: see Jackamarra v Krakouer (1998) 195 CLR 516 at [3]-[5]; Tomko v Palasty (No 2) [2007] NSWCA 369 at [55].
Actol did not press any submission that an extension of time should not be granted, nor did it allege unreasonable prejudice if we were to grant an extension. It neither consented to, nor opposed an extension of time. As the issue raised by the appeal goes to the Tribunal's jurisdiction then, in the absence of material prejudice, we will allow an extension for the filing of the Notice of Appeal.
[4]
Consideration of Rise's ground of appeal
The sole ground of appeal advanced by Rise was:
…whether the learned Senior Member erred at paragraph [384] of the decision in failing to correctly apply the presumption against the retrospective operation of legislation in finding that the limit of the jurisdiction of the Tribunal was not $40,000, as limited by section 79S of the Fair Trading Act 1987 (NSW) at the time the proceedings were commenced, but rather $100,000, as provided by regulation 13A of the Fair Trading Regulation 2019 (NSW) ("Regulations"), which came into effect on 18 July 2022 after the commencement of the proceedings.
This is not correctly drafted in terms of clearly identifying a question of law. However, it's substance does raise a question of law and Actol took no objection to the form of the ground.
Properly reframed, the question of law raised by this ground would be:
Did the amendment to the Tribunal's monetary jurisdictional limit effected by the Fair Trading Amendment (Monetary Limit on Orders) Regulation 2022 (NSW) operate in respect of the claim by Actol under the Fair Trading Act?
That is how the issue was presented and argued. There is no material prejudice to Actol in us answering that question of law.
[5]
Did the amendment to the Tribunal's monetary jurisdictional limit effected by the Fair Trading Amendment (Monetary Limit on Orders) Regulation 2022 (NSW) operate in respect of the claim by Actol under the Fair Trading Act?
[6]
The Tribunal's findings
On this issue the Tribunal held that the amendment did not apply to the proceedings. The Tribunal reasoned as follows:
[378] The past events giving rise to the liability on the part of Rise Products were not affected by the limit on the jurisdiction of the Tribunal imposed by s 79S or by the enactment of a regulation increasing that limit. Those past events have, as I have determined, given rise to a right of Actol to reimbursement and a liability to reimburse Actol on the part of Rise Products. Adapting the words of Dixon CJ, "the law appointing or regulating the manner in which [those rights and liabilities] are to be enforced ... by judicial remedy" is affected by the enactment of regulation 13A, but the rights and liabilities themselves are not."
[379] Rise Products had no vested interest in the limit imposed upon the capacity of the Tribunal to make orders in respect of a consumer claim, nor any right to complain if, during the litigation, that capacity is changed.
…
[383] Once it is recognised that there is no vested right to have proceedings determined in the Tribunal subject to a particular limit on jurisdiction, it follows that there can be no injustice to a party which may find that the jurisdictional limit has increased during the pendency of the proceedings in the Tribunal.
[7]
The Regulation and the Interpretation Act
The Fair Trading Amendment (Monetary Limit on Orders) Regulation 2022 (NSW) (MLO Regulation) commenced and came into force on 18 July 2022 (per reg 2). Regulation 3 provided that the following should be inserted as reg 13A into the Fair Trading Regulation 2019 (NSW):
For the Act, section 79S(7), definition of prescribed amount, the amount of $100,000 is prescribed.
The MLO Regulation contained no specific savings provision or transitional provisions. The savings and transitional provisions in the Fair Trading Regulation 2019 (NSW) are of no assistance. Nor can we derive any assistance from the Subordinate Legislation Act 1989 (NSW).
It is uncontroversial that the effect of the amendment is to increase the monetary limit for consumer claims in the Tribunal from $40,000 to $100,000. The question is, when does such change operate.
There is no difficulty applying that increased limit in circumstances where both the cause of action and the commencement of the Tribunal proceedings both occurred after 18 July 2022. However, the position is less clear where: as here, a claim is commenced in the Tribunal for an amount exceeding $40,000 before 18 July 2022 but determined after that date; and where a claim is commenced after that date, but in respect of a cause of action accruing before that date.
We shall first set out s 30 of the Interpretation Act 1987 (NSW) (Interpretation Act), then discuss some authorities on common law principles before returning to s 30 and its application.
Section 30 provides:
30 Effect of amendment or repeal of Acts and statutory rules
(1) The amendment or repeal of an Act or statutory rule does not -
(a) revive anything not in force or existing at the time at which the amendment or repeal takes effect, or
(b) affect the previous operation of the Act or statutory rule or anything duly suffered, done or commenced under the Act or statutory rule, or
(c) affect any right, privilege, obligation or liability acquired, accrued or incurred under the Act or statutory rule, or
(d) affect any penalty incurred in respect of any offence arising under the Act or statutory rule, or
(e) affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability or penalty,
and any such penalty may be imposed and enforced, and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, as if the Act or statutory rule had not been amended or repealed.
(2) Without limiting the effect of subsection (1), the amendment or repeal of an Act or statutory rule does not affect -
(a) the proof of any past act or thing, or
(b) any right, privilege, obligation or liability saved by the operation of the Act or statutory rule, or
(c) any amendment or validation made by the Act or statutory rule, or
(d) the operation of any savings or transitional provision contained in the Act or statutory rule.
(3) This section applies to the amendment or repeal of an Act or statutory rule in addition to, and without limiting the effect of, any provision of the Act or statutory rule by which the amendment or repeal is effected.
(4) In this section, a reference to the amendment or repeal of an Act or statutory rule includes -
(a) a reference to the expiration of the Act or statutory rule,
(b) a reference to an amendment or repeal of the Act or statutory rule effected by implication,
(c) a reference to the abrogation, limitation or extension of the effect of the Act or statutory rule, and
(d) a reference to -
(i) the exclusion from the application of the Act or statutory rule, or
(ii) the inclusion within the application of the Act or statutory rule,
of any person, subject-matter or circumstance.
[8]
The authorities
There is a presumption at common law that a statute or regulation should not generally be construed so as to operate retrospectively in the absence of a clear legislative intent that it should do so.
As cited by the Tribunal, Dixon CJ said in Maxwell v Murphy (1957) 96 CLR 261 at 267:
"The general rule of the common law is that a statute changing the law ought not, unless the intention appears with reasonable certainty, to be understood as applying to facts or events that have already occurred in such a way as to confer or impose or otherwise affect rights or liabilities which the law had defined by reference to the past events. But, given rights and liabilities fixed by reference to past facts, matters or events, the law appointing or regulating the manner in which they are to be enforced or their enjoyment is to be secured by judicial remedy is not within the application of such a presumption. Changes made in practice and procedure are applied to proceedings to enforce rights and liabilities, or for that matter to vindicate an immunity or privilege, notwithstanding that before the change in the law was made the accrual or establishment of the rights, liabilities, immunity or privilege was complete and rested on events or transactions that were otherwise past and closed. The basis of the distinction was stated by Mellish LJ in Republic of Costa Rica v Erlanger (1876) 3 Ch D 62, at 691. 'No suitor has any vested interest in the course of procedure, nor any right to complain, if during the litigation the procedure is changed, provided, of course, that no injustice is done'."
In Robertson v City of Nunawading [1973] VR 819, at 827, the Full Court of the Supreme Court of Victoria held that, referring to s 7(2) of the Acts Interpretation Act 1958 (Vic) which was in similar terms to s 30(1) of the Interpretation Act:
"There may be some areas in which the limits of the common law principle and those of this statutory provision are not the same. The case where an amending statute imposes an entirely new obligation may be one covered by the common law principle and not by the statutory provision. But, for present purposes, the quality of the right required for the purpose of the statutory provision can be tested in the same way as a right for the purpose of applying the common law."
Further, in Polyukovish v Commonwealth (1991) 172 CLR 501; [1991] HCA 32, Mason CJ said at [25]:
"Prima facie, the relevant substantive law for determining rights and liabilities is the law which operated at the time of the circumstances from which those rights and liabilities are alleged to arise. Thus, it is a rule of construction that it is to be presumed that it was not the legislative intent that a statutory provision which affects rights or liabilities should operate retrospectively. Nonetheless, the focus of civil litigation is upon the determination of rights and liabilities under the law as it exists at the time of the proceedings. Civil legislation which operates retrospectively in the sense that it extinguishes or alters pre-existing rights or liabilities or deems rights and liabilities which it creates to have existed at an earlier time may, depending on the circumstances, be susceptible of legitimate criticism as unfair or unjustified. Such legislation will not, however, contravene the doctrine of separation of powers merely because it retrospectively creates, extinguishes or alters civil rights and liabilities or because it requires the courts to recognize and enforce, in subsequent civil litigation, the retrospective operation of its provisions (cf., e.g., Reg. v. Kirby; Ex parte Boilermakers' Society of Australia, at p 281)."
Dawson J at [17] stated:
"But Blackstone was not denying the capacity of Parliament to pass ex post facto laws, however undesirable they may be: see Commentaries, 16th ed. (1825), vol.l, p 90. The resistance of the law to retrospectivity in legislation is to be found in the rule that, save where the legislature makes its intention clear, a statute ought not be given a retrospective operation where to do so would be to attach new legal consequences to facts or events which occurred before its commencement: Fisher v. Hebburn Ltd. [19601 HCA 80; (1960) 105 CLR 188, per Fullagar J. at p 194; see also Maxwell v Murphy [19571 HCA 7; (1957) 96 CLR 261, at p 267; Geraldton Building co. Pty. Ltd. v. May [1977] HCA 17; (1977) 136 CLR 379; Rodway v. The Queen [1990] HCA 19; (1990) 169 CLR 515, at p 518."
Actol referred us to the decision of the NSW Court of Appeal constituted by five justices which involved the operation of s 30(1)(c) of the Interpretation Act in In the Matter of Richards Contracting Co Management Pty Ltd [2021] NSWCA 34. The controversy there related to the operation of the Companies (New South Wales) Code 1981 as a basis for reinstating the company (which was otherwise in liquidation) and the making of a related claim against the Company pursuant to the Worker's Compensation Act 1987 (NSW).
The underlying dispute in Richards Contracting concerned an employee of the company who had contracted a dust related disease during the course of his employment with the company during the 1970s and early 1980s.
The company had subsequently been placed into external administration. So too, had the company's insurer for the relevant period. The purpose of the reinstatement application was to provide an avenue for the employee to make a claim as against a fund that had been created for the purposes of guaranteeing the liabilities of the worker's compensation insurer in respect to such claims. The plaintiff (worker) contended that he had an accrued right to have the company reinstated at the time of the repeal of the co-operative scheme laws. At [78]-[114] and following Bathurst CJ considered the operation of section 30(1)(c) of the Interpretation Act.
At [81]-[82] the former Chief Justice stated:
"[81] Section 30(1) is consistent with the position at common law. The position was summarised by Dixon J in Kraljevich v Lake View and Star Limited (1945) 70 CLR 647; [1945] HCA 29 as follows (at 652):
"As the request for a hearing of the appellant's application for redemption had been filed before Act No. 42 of 1944 came into operation, this case might be dealt with on the limited question whether the amendment effected by s. 4(g) of that statute in clause 18 of the First Schedule of the Workers' Compensation Act 1912-1941 applied to pending proceedings. But it is more satisfactory to decide the wider question whether the amendment applies to cases in which the injury by accident was caused to the worker before the amending Act came into force. The presumptive rule of construction is against reading a statute in such a way as to change accrued rights the title to which consists in transactions passed and closed or in facts or events that have already occurred. In other words, liabilities that are fixed, or rights that have been obtained, by the operation of the law upon facts or events for, or perhaps it should be said against, which the existing law provided are not to be disturbed by a general law governing future rights and liabilities unless the law so intends, appears with reasonable certainty. But, when the alteration in the law relates to the mode in which rights and liabilities are to be enforced or realized, there is no reason to presume that it was not intended to apply to rights and liabilities already existing and its application in reference to them will depend rather upon its particular character and the substantial effect that such an operation would produce."
See also Maxwell v Murphy (1957) 96 CLR 261; [1957] HCA 7 at 266-267
[82] Once it is recognised that accrued rights which had arisen as a result of the operation of the repealed co-operative scheme laws would be preserved, there is no need to give a strained construction to s 85 of the Corporations (New South Wales) Act to preserve those rights.
In Stephens v The Queen [2022] HCA 31 (Stephens) per Keane, Gordon, Edelman and Gleeson JJ at [30]-[31] the Court referred to the distinction between procedural and substantive provisions. Their Honours said:
"[30] Another distinction is sometimes drawn between substantive and procedural provisions. In Rodway, this Court referred to the presumption "that a statute ought not be given a retrospective operation where to do so would affect an existing right or obligation unless the language of the statute expressly or by necessary implication requires such construction". This Court explained that "there is no presumption against retrospectivity in the case of statutes which affect mere matters of procedure" as such statutes "invariably operate prospectively".
[31] This Court in Rodway recognised, however, that there was an ambiguity in the categorisation of some laws as procedural, saying that 'the difference between substantive law and procedure is often difficult to draw and statutes which are commonly classified as procedural ... may operate in such a way as to affect existing rights or obligations' and, as such, would not be 'merely' procedural. But even this distinction, which requires a difference between procedural laws and 'merely procedural' laws, is not a stable basis for deciding whether to apply a presumption against retroactivity. The point of principle underlying the distinction is that laws which might be said to be procedural can have such a significant effect in disturbing settled expectations that the presumption will apply, denying an otherwise clear retroactive effect in relation to an extant trial. An example is the law considered by this Court in Newell v The King that amended the procedure of conviction by a unanimous jury to permit conviction by a majority of ten jurors. The principle 'that a statute is not presumed to be retrospective' was applied because the law was 'not a mere matter of procedure.' The words of the legislation that said 'on the trial of any criminal issue' were interpreted to mean 'on the trial of any criminal issue joined after the commencement of the Act'."
[9]
Decision
In our view, the correct application of the MLO regulation is derived from the nature of the change it effects. By that we mean that whilst no new right is created, nor liability imposed by it, existing rights would be altered if the amendment were to apply retrospectively to past events (per Maxwell).
Similarly, having regard to the text of s 30 of the Interpretation Act, and whilst it does not affect the remedy in respect of any such right or liability, the amendment does, per s 30(1)(b), affect the previous operation of the Act or statutory rule or anything duly suffered, done or commenced under the Act or statutory rule in terms of the Tribunal's jurisdiction to award a sum over $40,000.
Actol's rights under the FTA and the remedy of damages (or reimbursement) existed irrespective of the amendment, including the remedy of damages (or reimbursement) exceeding $40,000. But the MLO Regulation changed the maximum amount that could be recovered for such a claim in the Tribunal.
In the proceedings as instituted, the claim made by the respondent was subject to a monetary jurisdictional limit in the Tribunal which provided the appellant with partial protection from that claim in the sense that anything beyond the jurisdictional limit was not recoverable in the Tribunal.
We do not think the effect of reg 13A inserted by the MLO Regulation can be said to be "merely procedural" in that context. The appellant had an existing right to ensure that any claim against it exceeding $40,000 would need to be contested in a court where the rules of evidence would apply. Variation of that position had such a significant effect in disturbing settled expectations that the presumption against reg 13A (retrospectively) affecting the claim should apply.
Nor can we discern that, in the absence of textual or contextual indicators in the MLO Regulation itself, the Parliament intended that it should operate in the manner found by the Tribunal. To be clear, we make no finding in respect of proceedings where a relevant claim is commenced after 18 July 2022, but in respect of a cause of action accruing before that date.
We are satisfied that the answer to the question of law whether "the amendment to the Tribunal's monetary jurisdictional limit effected by the Fair Trading Amendment (Monetary Limit on Orders) Regulation 2022 (NSW) operate in respect of the claim by Actol under the Fair Trading Act?", is "no".
Accordingly, the award in favour of Actol should have been $40,000 (the jurisdictional limit) rather than $50,650.60. Given Rise has paid the latter sum we will make orders addressing that overpayment.
As we shall mention later, Actol made a late amendment to its Notice of Appeal to include a challenge to the Tribunal's decision in respect of costs of the substantive proceedings at first instance. Likewise, at the hearing before us the potential that Rise may similarly wish to amend to challenge the costs decision was raised. It was within time to do so. Rise confirmed that it wished to amend its Notice of Appeal to challenge the decision as to costs in written submissions filed, with leave, after the hearing of the appeal. Given its success in the appeal, we will consider the impact of that success on the decision as to costs in the primary proceedings below.
[10]
Actol's grounds of appeal
Actol raised several grounds of appeal in its Amended Grounds of Appeal, each with various limbs, and sought leave to appeal. As drafted, Actol's grounds of appeal were as follows:
Ground 1: The Tribunal in finding that a supply-only contract (as opposed to a supply and install contract) existed between Actol and Rise:
(a) failed to provide proper reasons for:
(i) finding that Actol received four (4) supply-only quotations from Rise on 20 August 20192 when the incontrovertible evidence was that no such documents were sent to, nor received by Actol prior to the asserted contract came about on 23 August 2019;
(ii) finding that a Contract between Actol and 3Form existed for the installation of the goods when the incontrovertible evidence was that 3 Form subcontracted directly with Rise to install the goods; and
(iii) finding that a Contract existed between Actol and Benth.
(b) failed to afford procedural fairness to Actol in finding that there was an agency agreement between Rise and 3Form when no such agency had been pleaded or advanced by evidence by the parties in the Tribunal.
(c) reached a decision that was so unreasonable that no reasonable decision maker would make it.
Ground IA: The Tribunal erred in finding that despite Rise carrying out "residential building work" in arranging and supervising the installation work, such work did not constitute a Contract for the purposes the Home Building Act 1989 (NSW), the implied Section 18B Warranties7 in so far as:
(a) it failed to give proper reasons for the making a finding that Rise was not subject to the Section 18B Warranties.
(b) it asked the wrong question of itself, namely whether an installation / supervision contract for installation existed between Actol and Rise. Rather, if a contract existed between Rise and 3Form to which the implied warranties attached;
(c) it failed to consider and correctly apply Section 18B(2) of the Home Building Act 1989 (NSW) in circumstances where the Tribunal had made a finding that Rise undertook "residential building work"
(d) it reached a decision that was so unreasonable that no reasonable decision maker would make it as the Tribunal's decision is against the legislative intent of the Home Building Act 1989 (NSW).
Consumer Guarantees
Ground 2 The Tribunal erred in finding that Actol was not a "consumer" within the meaning of the Competition and Consumer Act 2010 (Cth) 101112 insofar as:
(a) it failed to provide proper reasons for its findings that Rise's goods were acquired for the purpose of Actol using them up or transforming them in trade or commerce in the course of a "process of production."
(b) it applied the wrong principle of law when it held the exclusion in Section 3(2) of the Australian Consumer Law included building materials used in the construction of a dwelling as constituting a "process of production".
(c) it failed to take into account a relevant consideration, namely that Actol acquired Rise's "services" within the meaning Section 95A and in turn asked the wrong question by not applying Section 3(3) of the Australian Consumer Law.
Ground 3 The Tribunal erred in finding (in the alternative, if it was wrong) that although it was reasonably foreseeable to Rise that Actol would suffer damage if the goods were not fit for purpose, that the defects arose from installation rather than the product itself, and in so doing:
(a) failed to provide proper reasons for finding:-
(i) the deficiency of the product was not causative or contributed to the defects;
(ii) it was unable to award more than nominal damages
(b) failed to apply Biggin and Co Ltd v Permanite Ltd (1951) 1 KB 422 that stands for the legal principle "provided that some evidence of loss or damage has been produced, difficulty or assessment is not a bar to the assessment of damages and where precise evidence is not available, the Tribunal must do the best that it can" as adopted in Curtis v Potter & Co Pty Ltd t/as The Africa Safari Co [2016] NSWCATAP 196.
(c) rejecting expert independent evidence in favour of the evidence of an interested party such that the decision is so unreasonable that no reasonable decision maker would make it.
Ground 4 The Tribunal erred in finding that Rise Products did not contravene section 4 and 18 of the Australian Consumer Law in respect of the Timing Representation insofar as it -
(a) failed to give proper reason(s) for finding Rise had no duty to correct the Timing Representation made by 3Form to Actol;
(b) there was no evidence to support a finding of fact that Mr Wakefield did not rely on the representation; and
(c) the decision was so unreasonable that no decision maker would make it in circumstances where it had found that Rise was 3Form's disclosed agent.
Ground 5 The Tribunal erred in finding that Rise Products did not contravene section 4 and 18 of the Australian Consumer Law in respect of the Installation Representation insofar as it -
(a) failed to give proper reasons for finding the Installation Representation was not as to a future matter under Section 4 of the ACL.
(b) the Tribunal asked the wrong question in respect of Section 18 of the ACL by finding that Actol was required to establish a falsity (i.e., 3Form was a competent installer) instead of ascertaining whether the representation was misleading or capable of leading it lead (sic) into error in accordance with Australian Competition and Consumer Commission v Dukemaster Pty Ltd [2009] FCA 682 at [10]
(c) there is no evidence to support the finding that Actol did not rely upon the Installation Representation.
(d) the decision was so unreasonable that no decision maker would make it in circumstances where the Tribunal has found that Rise was 3Form's disclosed agent.
Ground 6 The Tribunal erred in finding that Rise Products did not contravene section 4 and 18 of the Australian Consumer Law in respect of the Performance Representation insofar as it -
(a) failed to give proper reasons for:-
(i) the finding that the Performance Representations concerned the Rise Wall product generally and not specific to the goods delivered to Site1; and
(ii) for finding the Performance Representation was not as to a future matter under Section 4 of the ACL.
(b) the Tribunal asked the wrong question by finding that Actol was required to establish a falsity (i.e. Rise Superfinish 160 did not meet the performance representations) instead of ascertaining whether the representation was misleading or capable of leading Actol into error in accordance with Australian Competition and Consumer Commission v Dukemaster Pty Ltd [2009] FCA 682; at [10].
(c) the decision that the Performance Representation only applies to the product generally and not the specific goods delivered to Site is so unreasonable that no reasonable decision maker would have made it
Ground 7 The Tribunal erred in failing to make an assessment of damages in the alternative in the event it had found that a contravention of Section 18 of the ACL had occurred in that it: -
(a) failed to give proper reason(s) for finding that no compensation could be awarded to Actol.
(b) failed to apply Biggin and Co Ltd v Permanite Ltd (1951) 1 KB 422 that stands for the legal principle "provided that some evidence of loss or damage has been produced, difficulty or assessment is not a bar to the assessment of damages and where precise evidence is not available, the Tribunal must do the best that it can" as adopted in Curtis v Potter & Co Pty Ltd t/as The Africa Safari Co [2016] NSWCATAP 196.
(c) failed to apply the principals as set out in Kavanagh v Blissett [2001] NSWCA 79 in assessing the damages to infer an alternative contract was "generally available in the marketplace at the time".
Leave to Appeal
In the alternative to one or more of the grounds of appeal stated above, or to the extent to which those grounds do not relate to an error of law, Actol seeks leave to appeal on the basis that:
(a) it would be unjust and inequitable to allow the findings and decision of the Tribunal to stand;
(b) the Tribunal exercised its discretion (and so repeating the grounds set out above) against the weight of the evidence before it.
Shortly prior to the hearing before us, and within 28 days from release of the Tribunal's reserved decision on costs following its substantive decision, Actol sought to amend its Notice of Appeal to challenge the orders that it pay Mr Pszczonka's costs of the proceedings and to otherwise make no order as to costs. The challenge was solely made on the basis that costs followed the event, so that success in challenging the costs order was directly related to its success in the appeal from the Tribunal's substantive decision.
[11]
Prolix grounds
Without suggesting that an appellant is not entitled to seek to prosecute its appeal on any reasonably arguable grounds, the formulation of the grounds of appeal by Actol in its Amended Grounds of Appeal is repetitive and the grounds are prolix. They fail to identify with precision and clarity the grounds appealed on.
Section 36(3) of the NCAT Act imposes a duty on parties and their representatives to assist the Tribunal to achieve the just, quick and cheap resolution of the real issues in dispute. Prolixity of grounds of appeal is of no assistance to the Appeal Panel, as an extravagant or unnecessary number of grounds of appeal fails to assist facilitation of the real issues in the appeal: Salmon v Osmond [2015] NSWCA 42 at [35]. Further, as Ipp JA stated in Ohlstein v E & T Lloyd [2006] NSWCA 226 at [61]:
"An extravagantly excessive number of causes of action, or grounds of appeal, or particulars of negligence, are often a sign of serious problems with the health of the case being advanced. At the very least, they demonstrate a lack of appropriate consideration in formulating the issues and are obstacles in the path of justice. Apart from causing unnecessary delay and costs, the scattergun approach obscures the true issues, camouflages the pleader's best points, and unnecessarily complicates the task of the judge."
If grounds of appeal are prolix or repetitive, the grounds may be summarised by an Appeal Panel to condense the grounds into appropriate issues for consideration: Sze Tu v Lowe [2014] NSWCA 462 at [101]-[106].
Rise submitted that Actol "had failed to articulate properly any question of law and instead dressed up questions of fact as questions of law." Further, it submitted that "it is necessary that a question of law be stated with precision, as an appellant's right to appeal arises from the question of law": citing John Prendergast & Vanessa Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69 (Prendergast).
We will proceed on the basis that whilst the grounds of appeal are deficient in terms of not clearly identifying questions of law, except possibly in respect of the "no evidence" and "procedural unfairness" grounds, the substance is identifiable from the grounds and the submissions and leave to appeal should be granted where more than merely arguable error is raised, particularly in respect of issues set out in Prendergast at [13], being a list of issues from which a question of law may generally be identified.
The Tribunal, including the Appeal Panel, is a Tribunal of substance not form. It is not a court. It is required to 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: see s 38(4) of the NCAT Act; Moloney v Taylor [2016] NSWCA 199 per McColl JA, with whom Simpson JA and Ball J agreed, at [30]-[33].
As was observed by Griffith AJ in Targeted Property Investments Pty Ltd v Look Up Technologie Pty Ltd (No 2) [2023] NSWSC 416 at [33(9)] in relation to s 83(1) of the NCAT Act and the need to identify a question of law on an appeal to the Supreme Court [which would, we would think, apply equally to s 80(2)(b) and the identification of questions of law for internal appeals):
Whether or not an appeal is on a question of law should be approached as a matter of substance and not merely form. As the Full Court of the Federal Court said in Haritos at [107], if, as a matter of substance, there exists a question of law, the Court has "a procedural discretion, to be exercised judicially and where it is in the interests of justice to do so, to direct its formal identification in an amended notice of appeal even where the question of law has not been identified before the primary judge". It is notable that the Court there viewed this approach as consistent with that of the Court of Criminal Appeal in R v JS [2007] NSWCCA 272; (2007) 175 A Crim R 108 at [57] -[69] per Spigelman CJ (with whom Mason P, McClellan CJ at CL, Hidden and Howie JJ agreed). Where an appellant is unrepresented, it may be appropriate to adopt a more generous or benevolent approach in assessing whether the notice of appeal identifies a question of law (see, for example, Avetmiss Easy Pty Ltd v Australian Skills Qualifications Authority [2014] FCA 314 at [75] -[77] per Mortimer J, as approved in Haritos at [104] and see also Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69 at [12]).
[12]
Issues derived from Rise's grounds of appeal
As best we understand them Actol's grounds raise the following issues, some of which are questions of law:
1. Did the Tribunal deny Rise procedural fairness in a manner that could possibly have made a difference to the outcome of the decision?
2. Were any material findings of the Tribunal made in the absence of probative evidence?
3. Did the Tribunal in any material sense fail to give adequate reasons such that it constructively failed to exercise its jurisdiction?
4. If the answer to issue (3) is no, did the Tribunal's reasoning in any material sense indicate that its decision was more than arguably wrong, such that leave to appeal should be granted?
5. If the answer to issue (4) is yes in respect of any aspect of the Tribunal's decision, what is the correct decision in respect of that aspect of the findings and what flows from that?
6. Did the Tribunal fail to consider a relevant (in the sense that it was mandatory) consideration in a manner affecting its decision?
7. Did the Tribunal ask itself the wrong question or apply a wrong principle of law in a manner affecting its decision?
8. Did the Tribunal fail to consider and correctly apply s 18B of the HBA, given its finding that Rise had undertaken "Residential Building Work"?
9. Was the decision in any sense so unreasonable that no reasonable decision maker would have made it?
10. Was the Tribunal's application of the principles in Biggin and Co Ltd v Permanite Ltd (1951) 1 KB 422 more than arguably wrong such that leave to appeal should be granted and, if so, what is the correct outcome?
11. Was the Tribunal's application of the principles in Kavanagh v Blissett [2001] NSWCA 79 more than arguably wrong such that leave to appeal should be granted and, if so, what is the correct outcome?
[13]
Issue (1) Did the Tribunal deny Rise procedural fairness in a manner that could possibly have made a difference to the outcome of the decision?
Authority dictates that we hear and determine a procedural unfairness challenge prior to any other challenges and that "whenever a matter is remitted for a retrial, it is preferable that the appellate court restrict its assessment of the evidence to matters necessary to the finding of error": Royal Guardian Mortgage Management Pty Ltd v Nguyen [2016] NSWCA 88 at [9] and [13] per Basten JA.
Generally, to establish a denial of procedural fairness it is not necessary for an appellant to show that the deficiency in procedural fairness would have made a difference to the outcome: see Minister for Immigration and Border Protection v WZARH (2015) 256 CLR 326, at 342; [2015] HCA 40 at [58], per Gageler and Gordon JJ.
However, application of the principle and the outcome that should be arrived at where procedural unfairness is demonstrated requires both a forward-looking test and a backward-looking test. The forward-looking test is whether a new trial would inevitably result in the making of the same order, so that ordering a new trial would be a futility. The backward-looking test was whether it could be concluded that giving the opportunity to make submissions "could have made no possible difference to the result": Giretti v Deputy Commissioner of Taxation (1996) 70 FCR 151 Lindgren J citing Stead v State Government Insurance Commission (1986) 161 CLR 141; [1986] HCA 54.
Actol alleges the hearing of its application was procedurally unfair because the Tribunal found that there was an agency agreement between Rise and 3Form (Reasons at [186]) when no such agency agreement had been pleaded or advanced by a party at the hearing. However, that finding followed the Tribunal's extensive reasoning at [153]-[185], wherein the Tribunal considered what it described as the "central issue in the proceedings" which was the nature of the contractual relationship between Actol and Rise, determined on the objective theory of contract: County Securities Pty Ltd v Challenger Group Holdings Pty Ltd [2008] NSWCA 193 at [149]-[150].
In doing so, the Tribunal relevantly found that:
1. Actol and Rise entered into a contract for the supply by Rise to Actol of the Risewall product and associated items only (Reasons at [182]);
2. the corollary of that conclusion is that Actol contracted directly with 3Form for the installation and filling with concrete of the Risewall product (Reasons at [183]);
3. the mechanism by which 3Form became bound to a contract with Actol is not clear and was not fully explored either in evidence or submissions (Reasons at [184]); and
4. Actol relied on the fact that, apart from the delivery of the 3Form quote and the meeting on 20 August 2019, there was no communication between Mr Wakefield and Mr Gharib prior to 3Form commencing work, supporting its case that there was no contract between Actol and 3Form, and that Rise had contracted to install the Risewall product, employing 3Form as its subcontractor (Reasons at [185]).
Only then does the Tribunal record, at [186] that:
In my view that circumstance can be explained on the basis that Rise Products acted as disclosed agent for 3Form during the negotiations in August 2019. In circumstances where the email correspondence between Actol and Rise Products objectively discloses an intention that Actol would enter into separate contracts with Rise Products and 3Form, that is the conclusion which inevitably arises.
As can be seen, the reference to an agency arrangement comes only after the findings fatal to Actol's claim to have contracted with Rise for installation of the Risewall product. As a result, unless the Tribunal's findings as to the nature of the contract between Actol and Rise is successfully impugned, the loss of an opportunity on the part of Actol to make submissions on the issue of agency between 3Form and Rise could have had no effect on the outcome and a new trial would be a futility.
Further, the Tribunal raised the issue of agency and did give the parties the opportunity to make written submission on the issue. Properly understood, the complaint is that the finding of agency was not advanced by either party, not that they did not have an opportunity to present their position on the matter.
However, the Tribunal was entitled to make findings that did not exactly represent what either party submitted as long as it did not create an entirely new case with which the losing party had no testimonial or other evidentiary opportunity to deal: Suvaal v Cessnock City Council (2003) 77 ALJR 1449; [2003] HCA 41 at [36]. That does not appear to be the case here, but if it was it would only lead to our intervention if it was material, which it was not: State Water Corporation v Civil Team Engineering Pty Ltd [2013] NSWSC 1879 at [118].
We will return to any other challenges to the findings in respect of that central issue below.
[14]
Issue (2) Were any material findings of the Tribunal made in the absence of probative evidence?
The first allegation in this regard relates to the Tribunal's finding at [305] of its decision that Mr Wakefield (on behalf of Actol) did not rely on a representation alleged to have been made by Rise as to how quickly the Risewall product could be installed ("the timing representation").
The Tribunal dealt with the alleged representation, and the evidence in support of or contrary to it having been made, at [292]-[304] of its decision.
There are three fundamental flaws in this challenge.
The first is that the Tribunal found the alleged representation not to have been made: Reasons at [306].
The second is that it was Actol that bore the onus to establish the nature of the representation and that it relied upon the timing representation, if it was made, to ultimately succeed in securing damages.
The third is that the Tribunal recorded at [304]-[305] certain evidence of Mr Wakefield that the Tribunal was satisfied was inconsistent with the allegation of reliance.
The second allegation of this nature is similar to the first. Actol alleged that, in addition to the timing representation, representations were made on behalf of Rise that it or 3Form would competently install the Risewall product ("the installation representation") and that the finished product would meet standards represented by Rise ("the performance representation"): Reasons at [283].
This allegation of error fails because, again, Rise bore the onus to put sufficient evidence before the Tribunal for it to reach a state of reasonable satisfaction as to the nature of the representations made, that they were misleading and deceptive, and that it relied on them to its detriment. It failed to do so in respect of the installation representation: Reasons at [313]; and in respect of the performance representation: Reasons at [330].
[15]
Issues (3)-(5) Did the Tribunal in any material sense fail to give adequate reasons such that it constructively failed to exercise its jurisdiction; if not, did the Tribunal's reasoning in any material sense indicate that its decision was more than arguably wrong, such that leave to appeal should be granted and if so, what is the correct decision in respect of that aspect of the decision and what flows from that finding?
Various aspects of the Tribunal's reasoning are challenged.
[16]
The finding that Actol received four supply-only quotations from Rise on 20 August 2019
The balance of the ground as set out by the Actol is instructive, in that Actol goes on to allege that "…the incontrovertible evidence was that no such documents were sent to, nor received by Actol prior to the asserted contract came about on 23 August 2019 (sic)."
The Tribunal set out the relevant evidence at [58]-[68] and [165] of its decision as follows:
58 On 20 August 2019 Ms Hatem forwarded to Mr Wakefield an email headed "Rise Products Quote for Lot 3-6 Kellyville". Mr Wakefield responded asking Ms Hatem to send the email again as no attachment had come through. Ms Hatem sent a further email, which the time-stamp suggests was sent immediately upon receipt of Mr Wakefield's email.
59 The documents attached, or supposedly attached, to that email were four separate quotations dated 16 August 2019, one for each of lots 3 to 6, for the supply of panels, corner panels, end caps and floor tracks for the RiseWall "160 Series" formwork system. The price on each of the quotations was $25,325.30, inclusive of GST.
60 Each of the quotations in the Tender Bundle has attached to it five pages of terms and conditions. Actol submits that Rise Products did not supply its terms and conditions to Actol until after a contract was formed between them. Actol also submits that the terms and conditions relate to the opening of a credit account not a standard supply contract. I will address this issue, to the extent necessary, in due course.
61 On 21 August 2019 Ms Hatem emailed Mr Wakefield:
"Hi Peter
As per phone conversation Daniel doublechecking quantities/m2
Cost breakdown for lots 3 - 4 - 5 - 6 Inc GST
Rise Products
$101,301.20
3Form Structures
Install of Rise Wall
Supply & place of concrete and reinforcements
$113,088.80"
62 On 23 August 2019 Ms Hatem emailed Mr Wakefield with the subject line "Rise Products & 3Form supply & install quote":
"As per phone conversation 3Form have confirmed that they have not included GST for the Rise Products component in their quote so therefore you haven't been double charged GST.
Breakdown Exc GST-Lots 3-4 5-6
Rise Products
$23,023 per lot x 4 = $92,092
+ (GST $9,209.20)
3Form Structures
$102,808
+ (GST $10,280.80)
Hope that is clear - let me know there's anything else we need to look at."
63 On 26 August 2019 Mr Wakefield emailed Ms Hatem:
"Hi Lina,
We would like to give you the go ahead to supply your 160mm insulated Rise wall Super Finish.
3Form to fix the Rise wall product and supply concrete and steel.
Rise wall supply ==$92,092.00 +gst =$9,209.= $101,301.20
3 Form supply and fix = $102,808 + gst =$10,208.80 = $113,088.80
Total = $214,390.00
Do you have a standard contract or 3Form to sign or we will organise, so we have an idea on who's doing what and timing.
Regards Peter."
64 Actol maintains that, by that email, Actol accepted an offer made by Rise Products by the emails of 21 August and 23 August 2019.
65 Ms Hatem replied that afternoon:
"Hi Peter
Thank you for choosing Rise Products to be your supplier and 3Form to be your Installer.
Andrew from 3Form will contact you today/tomorrow to discuss the schedule amongst yourselves
That will then be the contract I guess between you and 3Form.
3Form will liase (sic) with us for the Fibre Cement orders/deliveries.
Let me know if you need other information
Thank you
Talk soon
Lina"
66 Ms Hatem attached to that email the four quotations referred to at [59]-[60] above. Actol maintains that this was the first time those documents had been provided to Actol. I will address that issue in due course.
67 On 3 September 2019, Ms Hatem emailed Mr Wakefield. The subject line of the email was "Actol invoices - Lot 3, Lot 4, Lot 5 & Lot 6". Mr Wakefield responded the same day: "Hi Lina, My wife said that she would pay in three lots". The attachments to Ms Hatem's email do not appear to be reproduced in the evidence. Nevertheless, I infer from Mr Wakefield's response that four invoices for the supply of RiseWall formwork were attached to the email. This inference is supported by a statement from Rise Products addressed to Actol and dated 13 September 2019 which records payment of $16,883.40 in respect of INV-3020 (reference Lot 5) for $25,325.30 and a balance due of $8,441.90 in respect of INV-3020 and $25,325.30 in respect of INV-3021 (reference Lot 6).
68 Between 4 September and 13 September 2019 Actol paid Rise Products $101,301.20, that is the amount identified in the 21 August and 23 August emails as the price for the supply of the RiseWall product by Rise Products.
…
165 In cross-examination by Mr O'Sullivan, Mr Wakefield was taken to each of the four quotes and agreed that he received them all together on 20 August 2019. I regard the inclusion of the quotes in the exhibit immediately following the two emails of 20 August 2019 as further acknowledgment by Mr Wakefield that those documents were attached to the second email. I find that the four quotes dated 16 August 2019 were received by Actol on 20 August 2019.
The Tribunal was alive to the dispute about whether, and if so when, the quotes were provided, recording at [59] of the decision:
"The documents attached, or supposedly attached, to that email were four separate quotations dated 16 August 2019.... "
(emphasis added)
The Tribunal found, at [182] of its decision, that:
"…by the exchange of emails between Mr Wakefield and Ms Hatem on 26 August 2019, Actol and Rise Products entered into a contract for the supply by Rise Products to Actol of the RiseWall panels and associated items referred to in the four quotes sent to Actol on 20 August 2019 at a price of $101,301.20 inclusive of GST. That contract was not a "contract to do residential building work" and accordingly did not include the implied warranties set out in s 18B of the Home Building Act."
It is entirely clear from the parts of the decision above that the Tribunal actively engaged with the cases put by the parties on this issue and made relevant findings based on its assessment of those respective cases. In that regard the reasons "apprehend the gravamen of each side's case, … attend to the central aspects of those cases, and the evidence bearing upon them, and … give reasons for the critical findings of fact and the evidence upon which they turn": Gautam v Health Care Complaints Commission [2021] NSWCA 85, per Leeming JA, with whom Payne JA and Simpson AJA agreed at [18].
As submitted by Rise, the Tribunal's reasons should also be considered in the context of the evidence given in cross-examination by Mr Wakefield, namely that he received the quotes on 20 August 2019 and that his email of 26 August 2019 was intended to accept the quotes: Appeal Bundle 002-TSCPT at pp 190 and 191.
We have reviewed that evidence and agree it supports the Tribunal's finding. That an actual email was not put into evidence that showed the 4 quotations as being attached on 20 August 2019 is not to the point. As Mr Wakefield gave evidence on behalf of Actol, and what he conceded in cross examination was against its own interests in respect of its pleaded case, it is unsurprising the Tribunal accepted it. It was certainly sufficient, with the other evidence, to found the findings made by the Tribunal.
We are satisfied that the Tribunal's reasons adequately explain to the parties the "extent to which their cases have been understood and accepted and (the) reasoning on points critical to the contest between the parties": Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247. We have also found them adequate to consider the appeal in this respect: Beale v Government Insurance Office of New South Wales (1997) 48 NSWLR 430 (at 444) per Meagher JA; DL v The Queen (2018) 266 CLR 1; [2018] HCA 26 at [32] per Kiefel CJ, Keane and Edelman JJ.
The challenge by Actol to that part of the Tribunal's reasons discloses no error on a question of law on the basis that the Tribunal may have constructively failed to exercise its jurisdiction or acted arbitrarily, rather than judicially. Nor, excluding the finding that the contract was not a "contract to do residential building work", which we address later, does the reasoning demonstrate that the Tribunal was more than arguably wrong such that leave to appeal should be granted.
Whilst there is no proper basis for this challenge to the Tribunal's reasoning in this respect, that does not end the enquiry. As held in New South Wales Police Force v Winter [2011] NSWCA 330 by Campbell JA, with whom Handley AJA agreed, at [90]:
Where the task of an appellate tribunal is to decide whether the primary decision-maker has given the right answer concerning the matter that was the subject of the decision appealed from, for the appellate tribunal to ask whether the primary decision maker has given adequate reasons does not in itself carry out the appellate tribunal's task: cf Shellharbour City Council [v Rigby [2006] NSWCA 308] at [311]-[316] per Basten JA (with whom Ipp JA agreed). Deciding whether the primary decision-maker has given adequate reasons might sometimes be a relevant task. For example, if the decision appealed from is the result of poor or inadequate reasoning the appellate tribunal might be more ready to conclude that the primary decision-maker has not come to the true and correct view than if the decision appealed from had been fully and carefully reasoned. However, a court deciding an appeal by way of rehearing, and also (relevantly here) a Presidential member of the Commission conducting a "review" of the decision of an Arbitrator, can substitute their own decision even if the decision appealed from has been fully and carefully reasoned: cf Shellharbour City Council at [310].
Consequently, we will still need to determine, as necessary, challenges to the conclusion reached by the Tribunal in this regard.
[17]
The purported findings that Actol contracted with 3Form and Benth to conduct the construction work with the Risewall product
There is no merit in this argument as the Tribunal made no such findings as alleged. In any event, in the absence of a successful challenge to the Tribunal's finding that, objectively construed, the contract between Actol and Rise was for supply only, any deficiency in the reasons could not have affected the outcome between the active parties in this appeal.
[18]
The finding that Rise was not subject to the warranties contained in s 18B of the Home Building Act 1989 (NSW)
At [182] of its decision, recorded above, the Tribunal decided that s 18B of the HBA had no application to the contract between Actol and Rise because that contract, on the construction given to it by the Tribunal, was not a "contract to do residential building work." It is true that the Tribunal did not recite s 18B of the HBA, but in a decision on a legally and factually complex dispute that already ran to 98 pages, it would have been surplusage to do so absent some explicit dispute between the parties as to the meaning or application of that section that does not appear to have occurred here.
Relevantly, s 18B of the HBA provides:
18B Warranties as to residential building work
(1) The following warranties by the holder of a contractor licence, or a person required to hold a contractor licence before entering into a contract, are implied in every contract to do residential building work -
… (emphasis added)
The Tribunal's reasons in this regard were sufficient to indicate that it had engaged with the matters in issue. With respect, Actol's real challenge to this aspect of the decision is not that the Tribunal failed to expose its reasoning as to why s 18B HBA had no application but was, in fact, why the Tribunal found that no contract existed between Actol and Rise beyond that for supply of the Risewall product, and which was not one to do residential building work. The substance of that challenge is addressed below.
[19]
The finding that Rise's goods were acquired for the purpose of Actol using them up or transforming them in trade or commerce in the course of a "process of production"
The relevance of this issue goes to the question of whether Actol was a "consumer" for the purposes of the ACL and could avail itself of remedies under that enactment.
The Tribunal considered this issue at [229]-[269] of its decision:
It recorded, relevantly, that:
1. Section 3 of the ACL relevantly presumes an entity to be a consumer if it:
1. acquires goods where the amount paid or payable did not exceed $40,000 or the goods were of a kind ordinarily acquired for personal, domestic or household use or consumption: ACL, s 3(1)(a)(i) or (b); but
2. even if that is so, the entity is not a consumer if it acquires or holds itself out as acquiring goods for the purpose of using them up or transforming them, in trade or commerce, including in the course of a process of production or manufacture: ACL, s 3(2)(b)(i);
3. the terms of ACL s 3(1)(b) were met in this case;
1. Rise "nevertheless submitted that Actol acquired the goods for the purpose of using them up or transforming them, in trade or commerce, in the course of a process of production or manner of manufacture or in the course of repairing or treating other goods, or fixtures on land (so that, by virtue of the exception in sub-s 3(2) of the ACL, Actol did not acquire the goods as a consumer)." Further, Rise relied upon the undisputed fact that Actol was constructing the houses on the site in order to sell them. Rise submitted that Actol acquired the Risewall product in order to use it for the construction of the concrete walls for the houses, which was a process of production or manufacture (Reasons at [242]-[243]);
2. Actol did not address that submission, which had been clearly pleaded against it (Reasons at [244]- [255]).
The Tribunal reviewed relevant authorities: Reasons at [246]-[250]. Those authorities included Laws v GWS Machinery Pty Ltd [2007] NSWSC 316, Theo Holdings Pty Ltd v Hockey; Australian Competition And Consumer Commission v Theo Holdings Pty Ltd [2000] FCA 665; (2000) 99 FCR 232 and 20*20 Pty Ltd v D&G Developments Pty Ltd [2009] WASC 343.
At [251]-[252] of the decision, the Tribunal recorded that:
"251 In my view, the RiseWall product was acquired by Actol for the purposes of being used up in trade or commerce in the course of a process of production, being the construction of four dwelling houses for sale at a profit. Notwithstanding the reservation expressed by Dowsett J, I consider that the construction of houses for sale at a profit is appropriately described as a "process of production".
252 Accordingly, Actol did not acquire the RiseWall product as a consumer and its claim for breach of the consumer guarantees under the ACL must fail."
In doing so, the Tribunal clearly grappled with the parties' cases and made findings based on its understanding of the relevant legislation and authority. Its decision in that regard sufficiently details a reasoning process that discloses no question of law on the basis that the Tribunal may have constructively failed to exercise its jurisdiction or failed to act judicially. Nor does the reasoning itself demonstrate that the Tribunal was more than arguably wrong such that leave to appeal should be granted.
However, to the extent the correctness of the finding is said to be so unreasonable no reasonable decision-maker would make it, we deal with that below.
[20]
The finding that the deficiencies in the product was not causative of, or did not materially contribute to, the defects
The Tribunal recorded at [263] that:
"I am not persuaded that the defects in the finished walls identified by Dr Cunniffe were a foreseeable consequence of the failure of the RiseWall product to comply with the consumer guarantees. The bulk of those defects were a result of the manner in which the products were installed and filled with concrete. Those which could not be so described related largely to the protruding screw heads and timber panels over joins. In my view, even if it were established that those issues were a consequence of defects in the RiseWall panelling, they were items that would in the ordinary course have been removed, as Mr Pope and Pszczonka said, after the concrete had set as part of the final finishing. In other words, I am not satisfied that those items were not simply elements of the installation task which had not been completed."
This finding, on the principles we have previously outlined, was more than sufficient to discharge the obligation on the Tribunal to give reasons.
[21]
The finding that the Tribunal was unable to award more than nominal damages.
The Tribunal recorded at [264]-[269]:
"264 Accordingly, the only damages recoverable by Actol would be compensation for the delay in completion of the buildings. However, I am not persuaded that Actol has presented sufficient evidence to enable me to assess the cost to Actol of the delays to the construction of the four houses caused by the supply of the defective RiseWall product.
265 Actol's claim for delay costs simply claimed two-thirds (that is four of six houses) of the interest cost on the loan which Mr Wakefield stated had been "taken out for construction of the six houses".
266 Mr Wakefield asserted that the project had been delayed by eight months, comprised of:
(1) The time taken to complete the lower floor walls ready for pouring concrete pour (four months)
(2) The time taken for Actol to organise an alternative system for the upper floors (two months)
(3) The time taken while Actol waited for Rise Products, 3Form and Gledswood to return to rectify defects.
267 Even if I were prepared to accept that evidence as reliable, which I do not, as it lacks either detail or cogent reasoning, it does not enable me to assess the extent to which the particular failures of the RiseWall panels delivered by Rise Products caused delays to the completion of the project.
268 I do not accept that any delay in the project was entirely the consequence of the problems with the RiseWall product. 3Form's decision to walk away from the job may have been partly attributable to the problems with the RiseWall product, but I do not consider that a contractor washing its hands of its obligation under a contract to install the product is a foreseeable consequence of the delivery of product with the two deficiencies which I have found.
269 If I had concluded that Rise Products was liable for breach of the consumer guarantees, I would not have awarded more than nominal damages, as Actol has failed to provide evidence sufficient to enable an assessment of its loss: see Gallagher v Masters Installation Pty Ltd [2017] NSWCATAP 117, at [51]."
As should by now be readily apparent, this reasoning sufficiently engages with Actol's case to avoid raising a question of law or a proper basis for leave to appeal. The question of whether the Tribunal was wrong, is a different one.
[22]
The finding that Rise had no duty to correct the Timing representation
In the absence of a successful challenge to the finding no such representation as pleaded was made or relied upon by Actol, we do not need to deal further with this issue. We will simply record that at [303] of its decision the Tribunal found that it could not be satisfied that "Mr Pszczonka or Mr Pope adopted that [timing representation] in any way…".
In those circumstances the reason the Tribunal found those people and, by inference Rise, were under no obligation to correct the timing representation may be properly described as self-evident.
[23]
The finding that the installation representation was not as to a "future matter."
We have already dealt with the relevance of this finding.
The factual finding of the Tribunal on this issue and its reasons for them were that:
"286 …The Installation Representation, if made, could only have been referring to 3Form, not to any installer which Rise Products might introduce in the future.
…
313 I accept that, by introducing 3Form as an appropriate installer, Rise Products represented that it believed them to be competent. However, Actol did not rely upon such a representation and did not seek to establish that it was not true, that is that Rise Products did not believe 3Form to be competent."
It is clear from that reasoning that, having found that Rise had already introduced 3Form to Actol by the time the contract was made, any representations allegedly made prior to 26 August 2019 as to 3Form's ability to install the product in a competent manner was not as to a "future matter". It was a representation as to Rise's belief as to 3Form's competency to install the product, assessed at the time the representation was made. The reasons are sufficient in that regard and clearly correct on an objective basis.
[24]
The finding that the Performance Representation concerned the Risewall product generally and [was] not specific to the goods delivered to site; and that it was as to a "future matter"
These issues do not need to be considered in the absence of a successful challenge by Actol to the Tribunal's finding that the representation was not misleading and deceptive (Reasons at [330]).
[25]
The finding that no compensation could be awarded to Actol had the Tribunal found, on an alternate basis, that Rise was responsible for a breach of s 18B of the HBA
The Tribunal gave reasons for this finding that in our view are unimpeachable on the principles we have already set out that included:
1. "The measure of Actol's loss would be the difference between what it has cost Actol to acquire and fill the RiseWall formwork, including the rectification of defects, and what it would have cost Actol to construct the ground floor walls if it had adopted a different method of construction" (Reasons at [335]).
2. "Actol did not tender any evidence to establish either the alternative method of construction it would have used, the cost of that alternative method of construction, or the time which walls constructed by that alternative method would have taken to completion" (Reasons at [337]).
3. "It cannot be said that such evidence would not have been available should Actol have sought to obtain it. Accordingly, on the principles outlined in Gallagher v Masters Installation Pty Ltd [2017] NSWCA 117 at [51], no compensation can be awarded."
[26]
Issue (6) Did the Tribunal fail to consider a relevant (in the sense that it was mandatory) consideration in a manner affecting its decision?
This allegation of error is that the Tribunal failed to take into account a relevant consideration, being that Actol acquired Rise's "services" within the meaning of s 95A (sic) and thereby asked the wrong question when deciding whether s 3 of the ACL applied.
Quite simply, having rejected an argument that Rise contracted with Actol to install the concrete using the Risewall product, the Tribunal then expressly rejected any claim by Actol that Rise otherwise provided it with services pursuant to a contract. It found at [196]-[201] of the decision that:
196 Unless Actol and Rise Products entered into a contract by which Rise Products agreed to undertake the coordination or supervision of the installation of the RiseWall panels, there was no contract between Actol and Rise Products into which the s 18B warranties could be implied.
197 I note that Rise Products did offer to take over the job by its letter of 15 November 2019. That offer was not accepted. Rather, Mr Wakefield rejected the offer and notified Rise Products that Actol would not be using RiseWall for the upper floors (despite having paid for panels for that purpose).
198 The nature of the arrangement thereafter was set out in Mr Pope's letter to Mr Wakefield of 19 November 2019 (see [105] above), that is, Rise Products "will endeavour to assist 3Form to complete the GFL (units 3 - 6) in accordance with their quote/agreement", and Mr Pope's email to Mr Gharib of 20 November 2019 (see [106] above) in which Mr Pope informed Mr Gharib that Rise Products had been unable to reach agreement with Actol to step in and take over the contract, that Actol was insisting that 3Form complete the ground floor, and that Rise Products was prepared to assist 3Form by supplying adjustable propping and metal angles and providing labour to complete the work and additional supervision to assist with the concrete pour.
199 Although Actol's points of claim refer to "the Supervision Contract", Actol did not plead that Actol and Rise Products entered into a contract in November 2019 by which Rise Products, for consideration, agreed to undertake supervision of the project. The relevant paragraph of Actol's Further Amended Points of Claim alleges no more than that "Rise Product acted as either the co-ordinator or supervisor of the installation of the Rise Wall at the Site." Actol's written submissions focussed on establishing that Rise Products was involved in the co-ordinating or supervising of the placement and filling of the RiseWall panels. There is no submission directed to the proposition that Rise Products was doing so pursuant to any contract.
200 Rise Products' conduct is entirely consistent with it being solely concerned, whether for reputational reasons or otherwise, to assist 3Form/Actol, gratuitously, to ensure the project was completed.
201 I am accordingly not persuaded that Rise Products entered into any contract with Actol for the provision of residential building work and it follows that I do not find that Rise Products breached any contractual obligation (including breach of statutory warranty) in relation to the installation of the RiseWall panels, or the supervision of the installation. Actol did not plead (or rely upon) any other basis upon which Rise Products might have been held liable for the defective installation of the RiseWall panels.
Actol argues error on the following bases:
1. It pleaded at paragraph 22 of its Amended Points of Claim that "in breach of the Consumer Guarantees... the supply and install of the Rise Walls were defective, not acceptable in appearance and finish...".
2. The Tribunal acknowledged "Rise Products did undertake supervision of the project after 15 November 2019, if not before, and … that supervision constituted residential building work within the definition of that term in clause 2 of schedule I to the Home Building Act" (Reasons at [195]).
3. This being the case and irrespective of the application of the Home Building Act, Rise has provided services to Actol in circumstances were the later was "a consumer" because:
1. Section 3(2) of the Australian Consumer Law sets out, relevantly, that:
(3) A person is taken to have acquired particular services as a consumer if, and only if:
(a) the amount paid or payable for the services, as worked out under subsections (4) to, did not exceed:
(i) $40,000;
…
or (b) the services were of a kind ordinarily acquired for personal, domestic or household use or consumption.
1. The Tribunal, having accepted that the supply of Risewall product is the supply of "goods of a kind ordinarily acquired for personal, domestic or household use or consumption" (Reasons at [239]), it follows that the Rise's services, in supervising and installing the Risewall Product (whether from the onset or after 15 November 2019), are services of "a kind ordinarily acquired for personal, domestic or household use or consumption".
2. The Tribunal has also asked the wrong question, limiting itself to the question of whether Actol acquired goods as a consumer only and in doing so has failed to consider (and determine) the question as to whether or not Actol obtained Rise's services as a consumer which could have been established on the evidence before the Tribunal.
Firstly, raising this argument as an allegation that the Tribunal failed to have regard to a relevant consideration or asked itself the wrong question in the context of this appeal is misconceived. In the appellate context, failing to have regard to a relevant consideration means that the consideration is mandatory having regard to the text and context of a relevant provision but was not considered. Nor is an allegation the Tribunal asked itself the wrong question apposite.
What is really alleged here is that the Tribunal failed to go on from the findings it made to make further findings that Actol now agitates for. What is really in issue is whether those findings were consistent with Actol's case at first instance or required to be considered having regard to the way it was argued.
We are not satisfied this argument has any merit. That Actol may have pleaded that "the supply and install of the Rise Walls were defective, not acceptable in appearance and finish..." does not equate to an argument that loss was materially contributed to by the limited "supervision" the Tribunal found Rise to have engaged in. Nor does the Tribunal's finding that the Risewall product was of "a kind ordinarily acquired for personal, domestic or household use or consumption" lead inevitably to a finding that the supervision engaged in by Rise was similarly a service of a kind ordinarily acquired for personal, domestic or household use or consumption.
In the absence of an evidenced assertion that these allegations formed part of Actol's case or were argued for by it, this allegation of error appears to be nothing more than an ex post facto attempt by Actol to bring an arguable case for breach of the ACL within the Tribunal's findings. No error in the Tribunal's decision is established in that way.
[27]
Issue (7) Did the Tribunal otherwise ask itself the wrong question or apply a wrong principle in a manner affecting its decision?
Otherwise, Actol argues the Tribunal asked itself the wrong question in the following ways:
1. In deciding no contract existed between Actol and Rise for the purposes of the HBA into which the warranties in s 18B HBA were implied by considering whether an installation contract existed between Actol and Rise; instead of whether a contract existed between Rise and 3Form to which the implied warranties attached.
2. By applying the wrong principle of law when holding that the exclusion in s 3(2) of the ACL included building materials used in the construction of a dwelling as constituting a "process of production".
3. By finding that, in respect of s 18 of the ACL, Actol was required to establish a falsity, being that 3Form was a competent installer, instead of ascertaining whether the installation representation was misleading; and in respect of the finding that Rise did not breach s 18 read with s 4 of the ACL in respect of the performance representation by deciding that Actol was required to establish a falsity, being that Rise Superfinish 160 did not meet the performance representation, instead of ascertaining whether the performance representation was misleading or capable of leading Actol into error.
[28]
Consideration of issue 7
To the extent it is comprehensible, we see no merit in the first of these arguments. Actol pleaded a contract with Rise for the supply and install of the Risewall product. The Tribunal accepted the former existed but not the latter. In respect of the supply contract, the Tribunal decided that the warranties contained in s 18B HBA were not imported into the contract because it was not a contract to "do residential building work". That is sufficient to dispense with the alleged error as actually pleaded.
We would simply add that no contract between Rise and 3Form was specifically pleaded. Relevantly, in the Further Amended points of claim (003-SUBS-040 ff at 049 ff) the following is relevantly pleaded in the alternative to a finding that Rise contracted with Actol to install the Risewall product:
"Rise's Role as Supervisor
8 By operation of Schedule 1 Clause 2(1) of the Act residential building work includes any work involved in co-ordinating or supervising any work involved in the construction of a dwelling.
9 If the Contract is limited to the supply of the Rise Wall (which is otherwise denied by Actol), in the alternative to the above claims, Actol says that Rise Product acted as either the coordinator or supervisor of the installation of the Rise Wall at the Site by the Third Respondent, 3 Form Structures Pty Ltd (3 Form) and or the Fourth Respondent, Benth Holdings Pty Ltd trading as Gledswood Projects (Gledswood) (the Supervision Contract).
10 The Supervision Contract included in its terms the implied statutory warranties set out in section 18B of the Act.
…
12 At all material times pursuant to the Supervision Contract, Rise Products co-ordinated and or supervised the installation of the Rise Wall by 3 Form and or Gledswood at the Site. Rise Products failed to properly and or competently supervise the installation of the Rise Wall by 3 Form and or Gledswood
13 In the premises of paragraph 36 above, Rise Product breached the terms of the Supervision Contract
14 As a result of the breach of the Supervision Contract, Actol has suffered loss and damage."
That does not amount to an allegation there was a contract for supervision between Rise and 3Form. If we are wrong in that, nothing is pleaded to explain how Actol was entitled to rely on the breach of any such contract between Rise and 3Form given the prima facie privity of contract that would apply as between those parties: Ace Woollahra Pty Ltd v The Owners--Strata Plan 61424 & Anor [2010] NSWCA 101. The Tribunal also made specific findings which are inconsistent with the existence of a contract between Rise and 3Form, at [198] and [200] of the decision, recited above.
In respect of the second allegation of error on this issue, Actol submits that, in finding it was not a consumer under the ACL because the exclusion in s 3(2) of the ACL included building materials used in the construction of a dwelling as constituting a "process of production", the Tribunal applied a wrong principle.
Again, s 3(2) of the ACL relevantly provides:
(2) However, subsection (1) [ the deeming provision by which an entity is taken to have acquired particular goods as a consumer] does not apply if the person acquired the goods, or held himself or herself out as acquiring the goods:
(a) for the following purpose:
(i) for goods other than gift cards - for the purpose of re‑supply;
…
(b) for the purpose of using them up or transforming them, in trade or commerce:
(i) in the course of a process of production or manufacture; or
…
The Tribunal's reasoning and conclusion on this issue, having found the facts, was at [242]-[251] of the decision:
"242 Rise Products nevertheless submitted that Actol acquired the goods for the purpose of using them up or transforming them, in trade or commerce, in the course of a process of production or manner of manufacture or in the course of repairing or treating other goods, or fixtures on land (so that, by virtue of the exception in sub-s 3(2) of the ACL, Actol did not acquire the goods as a consumer).
243 Rise Products relied upon the undisputed fact that Actol was constructing the houses on the Site in order to sell them. Rise Products submitted that Actol acquired the RiseWall product in order to use it for the construction of the concrete walls for the houses, which was a process of production or manufacture.
244 Actol did not directly address this submission, which was clearly pleaded by Rise Products in its Points of Defence.
245 My researches (sic) have been able to locate only three authorities dealing with sub-s 3(2) of the ACL or the equivalent provision in the Trade Practices Act.
246 In Laws v GWS Machinery Pty Ltd [2007] NSWSC 316, Rothman J rejected the submission that the purchaser of a tyre for a tractor used in the purchaser's business acquired the tyre for the purpose of using it up in the course of a process of production or manufacture.
247 Theo Holdings Pty Ltd v Hockey; Australian Competition And Consumer Commission v Theo Holdings Pty Ltd [2000] FCA 665; (2000) 99 FCR 232 involved consideration of the provisions of ss 65F to 65P of the Trade Practices Act which permitted the relevant Minister to direct the recall of "goods that are intended to be used, or are of a kind likely to be used, by a consumer ...". The applicants were suppliers of fire doors.
248 Dowsett J held that "consumer" in s 65F was intended to have the same meaning as elsewhere in the Act, that is the meaning defined by the equivalent provision to s 3 of the ACL.
249 At [27], his Honour stated:
"It seems probable that the applicants expected their doors to be purchased by builders for installation in buildings being constructed by them on land belonging to others. A supply to such a builder would be for resupply (by the builder), and so that builder would not acquire the doors as a consumer. It follows that the applicants' doors were not intended for use by a consumer. Whether such a builder would also acquire the doors "for the purpose of using them up or transforming them ... in the course of production or manufacture or of repairing or treating other goods or fixtures on land; ...", it is not necessary to decide. The terms "production or manufacture" and "repairing or treating" may not be appropriate to describe construction of a building. I should add that counsel for ACCC submitted that persons using buildings in which the doors had been installed might be consumers of those doors. Such a usage of language would be unusual. Further, it is clear that para 65F(1)(a) focuses on the goods at the time of their supply by the relevant corporation. If one were asked at that time to describe the possible use of such a product, one would certainly say that it was for installation in a building." [Emphasis added.]
250 That paragraph was cited by Murphy J in 20*20 Pty Ltd v D&G Developments Pty Ltd [2009] WASC 343, at [45], as authority for the proposition that:
"Windows and doors are goods of a kind ordinarily acquired for household use, but where they are acquired by a builder for building work, they are acquired for the purpose of resupply."
251 In my view, the RiseWall product was acquired by Actol for the purposes of being used up in trade or commerce in the course of a process of production, being the construction of for dwelling houses for sale at a profit. Notwithstanding the reservation expressed by Dowsett J, I consider that the construction of houses for sale at a profit is appropriately described as a "process of production"."
Actol's argument proceeds in this way:
1. "The terms "production or manufacture " and "repairing or treating" may not be appropriate to describe construction of a building": Theo Holdings.
2. The Tribunal's reference to Murphy J's comments in 20*20 Pty Ltd at [45], as authority for the proposition that: "Windows and doors are goods of a kind ordinarily acquired for household use, but where they are acquired by a builder for building work, they are acquired for the purpose of resupply" indicates that the Tribunal has conflated the consideration of whether goods "are acquired for the purpose of resupply" (relevant only to the exclusion under 3(2)(a)(i) of the ACL) with whether the goods were acquired for the purpose of "being used up in trade or commerce in the course of a process of production" which is a separate provision in accordance with s 3(2)(b)(i) of the ACL.
We disagree. As we set out earlier, the Tribunal referred to the three cases as the only authorities it could locate in relation to s 3(2) of the ACL or the equivalent provision in the Trade Practices Act. That does not indicate that it conflated the subparts of that provision. It made a finding that the product was acquired to be "used up in trade or commerce in the course of a process of production", fully meeting the requirement of s 3(2)(b)(i) of the ACL and placing no importance on s 3(2)(a) of the ACL.
The first aspect of the third branch of alleged error on this issue does not arise for determination in the absence of a successful challenge to the Tribunal's finding at [311]-[313] that:
311 I accept that on 20 August 2019 Rise Products introduced 3Form to Actol as an appropriate installer. Mr Pszczonka's evidence was that Mr Pope said to Mr Wakefield that 3Form "can do the installation" (see [49] above).
312 Neither Mr Wakefield's version of the conversation, "They [3Form] are familiar with the Rise Products and we have worked with them in the past" (see [48] above), nor Mr Pszczonka's version, involved an express statement that 3Form was competent.
313 I accept that, by introducing 3Form as an appropriate installer, Rise Products represented that it believed them to be competent. However, Actol did not rely upon such a representation and did not seek to establish that it was not true, that is that Rise Products did not believe 3Form to be competent.
3Form's competence was not in issue in this regard, it was Rise's belief in 3Form's competence the Tribunal was concerned with.
In respect of the second aspect of the third branch of alleged error on this issue, s 4 of the ACL relevantly provides:
4 Misleading representations with respect to future matters
(1) If:
(a) a person makes a representation with respect to any future matter (including the doing of, or the refusing to do, any act); and
(b) the person does not have reasonable grounds for making the representation;
the representation is taken, for the purposes of this Schedule, to be misleading.
(2) For the purposes of applying subsection (1) in relation to a proceeding concerning a representation made with respect to a future matter by:
(a) a party to the proceeding;
…
the party or other person is taken not to have had reasonable grounds for making the representation, unless evidence is adduced to the contrary.
(3) To avoid doubt, subsection (2) does not:
(a) have the effect that, merely because such evidence to the contrary is adduced, the person who made the representation is taken to have had reasonable grounds for making the representation; or
(b) have the effect of placing on any person an onus of proving that the person who made the representation had reasonable grounds for making the representation.
…
This issue was determined by the Tribunal at [321]-[330] of its decision:
"Performance Representations
321 Mr Pszczonka acknowledged in cross-examination that it was his usual practice in 2019 to "promote the positive parts of the RiseWall product to potential customers" which included telling potential customers that the RiseWall product:
"is a high quality finish"
"is true and straight once erected"
"is a perfect flat finish"
"[goes] up very fast"
"[is] a flexible design" and
"[is] compatible with all drawings, specifications and plans".
322 Mr Pszczonka did not dispute Mr Wakefield's version of the conversation in which Mr Wakefield alleged that the Performance Representations were made.
323 I accept that representations to the effect of the Performance Representations, as particularised by Actol in the Further Amended Points of Claim, were made by Mr Pszczonka to Mr Wakefield in June 2019.
324 However, as noted above, the representations concerned the RiseWall product generally, not the specific goods delivered to the Site.
325 Although I have found that the product delivered to the Site was not of acceptable quality and not fit for the purpose of being an easily installed formwork system, Actol did not tender evidence and did not seek to establish that the RiseWall Super Finish 160 Series product was, generally, not:
of high quality finish
true and straight
perfect flat finish
capable of erection very quickly
flexible in design or
compatible with all plans.
326 Mr Pszczonka's evidence concerning the conversation with Mr Wakefield in June 2019 was:
"I recall a conversation along the lines set out. Pro 9 is a competitor's product that in my view, leaves walls with a rough surface. Rise Products' Rise Wall products use fibre cement sheets that leave a much smoother surface than Pro 9."
327 That suggests that the statement "you won't have any problems like you did with Pro 9" was made in the context of discussions concerning the surface finish of the product.
328 In that context, even if the representation is characterised as a representation as to a future matter, there was evidence that Rise Products had reasonable grounds for the representation, that is "Rise Wall products use fibre cement sheets that leave a much smoother surface than the Pro 9".
329 Mr Pszczonka was not challenged on his evidence in that regard.
330 Accordingly, I am not persuaded on the balance of probabilities that Actol has established that the Performance Representations were misleading and deceptive in breach of s 18 of the ACL."
By that reasoning, the Tribunal followed an orthodox process. Leaving aside reliance and damage, to succeed in an allegation that Rise breached s 18 of the ACL, utilising the evidentiary provisions of s 4 of the ACL, Actol needed to establish:
1. the nature of the representation as to future matters made; and
2. If there was credible evidence the entity making the representation had reasonable grounds for making it (an inference to the contrary, absent such evidence, being imported by s 4(2) of the ACL), that the representation was not made on reasonable grounds.
It is true that Actol bore no onus of proof: ACL s 4(3)(b). But, having regard to what the Tribunal found to be encompassed by the Performance representation and the finding that there was some evidence to support the reasonableness of what it contained, Actol did then have an evidentiary burden to put sufficient evidence before the Tribunal to allow it to feel a reasonable sense of persuasion that the substance of the representation was not made on reasonable grounds.
There is no merit in this argument.
[29]
Issue 8 - Did the Tribunal fail to consider and correctly apply s 18B of the HBA, given its finding that Rise had undertaken "Residential Building Work"?
Actol's argument is as follows:
In determining that s 18B HBA warranties did not apply to supervision works undertaken by Rise, the Tribunal made the following findings:
"194 … Rise Products became more actively involved, including directly contracting with Jarrod B and DJK to undertake work preparing the formwork and to assist with the concrete pour. The evidence also suggests, and I so find on the balance of probabilities, that Rise Products was responsible for booking the concrete supply and the concrete pump …
195 I accept that Rise Products did undertake supervision of the project after 15 November 2019, if not before, and I also accept that that supervision constituted residential building work within the definition of that term in clause 2 of schedule I to the Home Building Act. …
…
198 The nature of the arrangement thereafter a set out in Mr Pope's letter to Mr Wakefield of 19 November 2019 … that is Rise Products 'will endeavour to assist 3Form to complete the GFL (units 3 - 6) in accordance with their quote/agreement' …"
Actol submitted that the Tribunal did not consider the following alternative scenarios:
1. Where (as found by the Tribunal) 3Form was the installer, whether Rise entered into a contract (to which statutory warranties apply) with 3Form when it assisted 3Form with completing the works.
2. Whether the statutory warranties were implied into the contract between 3Form and Rise pursuant to s 18B(2) of the HBA.
3. Whether the statutory warranties were implied pursuant to s 18B(2) against both Rise, and Rise's Subcontractors, Jarred B and DJK.
By failing to address these issues it is submitted that the Tribunal fell into error.
However, as we found earlier, the Tribunal made material findings indicating that there was no contract between Rise and 3Form (Reasons at [198] and [200]) and we were taken to nothing indicating there was a meeting of the minds with an intent to create legal relations between Rise and 3Form, nor the passing of consideration between them. Even were there such a contract, nothing was pleaded as to how Actol could rely on the benefit of statutory warranties imported into it. The Tribunal was only required to determine the case advanced by Actol and made no error in failing to deal with a case not advanced before it.
[30]
Issue 9 - Was the decision in any sense so unreasonable that no reasonable decision maker would have made it?
In its reply to appeal Rise challenged the various ways in which the appellant had utilised this allegation of error as conflating principles of administrative law with the exercise of judicial power by the Tribunal in these proceedings. The basis for that submission may be understood on the basis that "unreasonableness" simpliciter as a ground of error has seen its most recent significant development in the administrative law context: see, for example, Minister for Immigration and Citizenship v SZMDS (2010) 240 CLR 611; [2010] HCA 16; Minister for Migration and Citizenship v Li (2013) 249 CLR 332.
However, the concept of an error being apparent from the result of a decision making process even where the error in the process itself may not be explicitly clear did not begin in the administrative law sphere: House v R (1936) 55 CLR 499.
What is relevant, though, is that the concept of unreasonableness is directed to the exercise of a discretionary power, not to fact-finding: Minister for Immigration and Multicultural Affairs v Eshetu 197 CLR 61; [1999] HCA 21 at [122]-[127] (Gummow J); Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S20/2002 77 ALJR 1165; [2003] HCA 30 at [67] (McHugh and Gummow JJ).
Even where the concept of unreasonableness is invoked, the High Court has made it clear that a court or tribunal should be slow to intervene or give an affirmative answer that the decision was irrational or illogical: see Minister for Immigration and Citizenship v SZMDS [2010] HCA 16. If logical or rational minds might differ in their opinion of or conclusion on the same evidence, the decision cannot be seen to be illogical, irrational or unreasonable.
The key question is whether the finding of the Tribunal was open to it on the evidence, or whether the finding had any evidentiary basis: Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321; [1990] HCA 33 at [355-6]; Ortiz v Minister for Immigration and Citizenship [2011] FCA 1498 at [53].
We think it follows sufficiently clearly from our assessment of the previous grounds, particularly in respect of the Tribunal's reasoning process, that we do not accept that the Tribunal's decision making was unreasonable in any material sense, even if unreasonableness applies in some way to the decision making process the Tribunal was involved in.
[31]
Those findings are determinative as to liability
Having regard to our conclusion that the Tribunal did not err in respect of the previous grounds, or in respect of finding that Rise was not liable to Actol for damages, we do not need to consider issue 10, which went only to the assessment of damages if liability was established, nor issue 11 which was only alleged to be relevant to error if a breach of s 18B of the ACL by Rise was established (Ground 7(c)).
[32]
The appeals from the decision as to costs at first instance
As Actol failed in its challenge to the substantive decision, so must its challenge to the decision as to costs.
If it succeeded in its appeal as to the Tribunal's monetary jurisdiction, Rise sought an order that Actol pay 90% of its costs in Actol's claim at first instance, together with other machinery orders. We will need to make provision for submissions as to that issue, having regard to Rise's success.
[33]
Costs of the appeal
Each party indicated that, in the event that they were successful in the appeal, they sought costs. Rise has had total success in its appeal, although the amount in issue in its appeal was far less than $30,000 meaning it would need to demonstrate special circumstances warranting an award as to costs: NCAT Act, s 60; Civil and Administrative Tribunal Rules 2014 (NSW), r 38A. We express the tentative view, as the issue in Rise's appeal involved a novel issue of statutory interpretation in the Appeal Panel, that no order as to costs is warranted. In Actol's appeal, however, the amount in dispute far exceeded $30,000. Our tentative view, unless other factors need to be considered, is that Actol should pay Rise's costs (which we understand would also encompass those of Mr Pszczonka) on the ordinary basis.
We encourage the parties to come to an agreed position resolving Rise's challenge to the Tribunal's determination as to costs at first instance, and to provide draft consent orders in that regard, but will give them the opportunity to make submissions in case that cannot be achieved.
[34]
Orders
Our Orders are as follows in AP 2023/00061795:
1. Leave to extend time for the filing of the appeal by Rise Products Pty Ltd is granted to the date of filing of the Notice of Appeal;
2. Leave is granted to Rise Products Pty Ltd to challenge the Tribunal's determination of costs in the proceedings at first instance in the appeal;
3. Actol Pty Ltd is to pay Rise Products Pty Ltd the sum of $10,650.60 within 21 days;
4. Make no order as to costs of the appeal;
5. If any party wishes to make an application to vary order (4) above, the applicant (the costs applicant) must file and serve a costs application, including submissions limited to three pages and any evidence in support, on or before 14 days from the date of this decision;
6. The respondent to the costs application is to file and serve any submissions limited to three pages and any evidence in reply on or before 28 days from the date of this decision;
7. The parties are to indicate in their submissions whether they consent to an order dispensing with an oral hearing of the costs application, and if they do not consent, submissions of no more than one page as to why an oral hearing should be conducted rather than the application being determined on the papers. If a hearing is not dispensed with, the parties will be advised of a date for the hearing of the application;
8. In respect of the challenge to the decision as to costs at first instance:
1. Rise Products Pty Ltd must file and serve submissions in support of the appeal, limited to five pages and any evidence in support, on or before 14 days from the date of this decision;
2. Actol Pty Ltd is to file and serve any submissions limited to five pages and any evidence in reply on or before 28 days from the date of this decision;
3. The parties are to indicate in their submissions whether they consent to an order dispensing with an oral hearing of this aspect of the appeal, and if they do not consent, submissions of no more than one page as to why an oral hearing should be conducted rather than the appeal being determined on the papers. If a hearing is not dispensed with, the parties will be advised of a date for the hearing of this aspect of the appeal.
Our Orders are as follows in AP 2023/00003459:
1. Leave to appeal is refused;
2. The appeal on questions of law is dismissed;
3. Actol Pty Ltd is to pay the costs of Rise Products Pty Ltd of the appeal as agreed or assessed under the applicable costs legislation;
4. If any party wishes to make an application to vary order (3) above, the applicant (the costs applicant) must file and serve a costs application, including submissions limited to three pages and any evidence in support, on or before 14 days from the date of this decision;
5. The respondent to the costs application is to file and serve any submissions limited to three pages and any evidence in reply on or before 28 days from the date of this decision;
6. The parties are to indicate in their submissions whether they consent to an order dispensing with an oral hearing of the costs application, and if they do not consent, submissions of no more than one page as to why an oral hearing should be conducted rather than the application being determined on the papers. If a hearing is not dispensed with, the parties will be advised of a date for the hearing of the application.
I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.
Registrar
[35]
Amendments
18 September 2023 - Amended spacing in orders
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 18 September 2023
Legislation Cited (13)
Fair Trading Amendment (Monetary Limit on Orders) Regulation 2022(NSW)
of no more than one page as to why an oral hearing should be conducted rather than the application being determined on the papers. If a hearing is not dispensed with, the parties will be advised of a date for the hearing of the application.
Catchwords: APPEALS - statutory interpretation - when amendment increasing Tribunal's monetary jurisdictional limit in claims under the Fair Trading Act 1987 (NSW) takes effect - questions of law - adequacy of reasons as a question of law - need to identify questions of law with clarity
Legislation Cited: Australian Consumer Law (NSW)
Civil and Administrative Tribunal Act 2013 (NSW)
Civil and Administrative Tribunal Rules 2014 (NSW)
Corporations Act 2001 (Cth)
Design and Building Practitioners Act 2020 (NSW)
Fair Trading Act 1987 (NSW)
Fair Trading Amendment (Monetary Limit on Orders) Regulation 2022 (NSW)
Home Building Act 1989 (NSW)
Interpretation Act 1987 (NSW)
Subordinate Legislation Act 1989 (NSW)
Worker's Compensation Act 1987 (NSW)
Cases Cited: 20*20 Pty Ltd v D&G Developments Pty Ltd [2009] WASC 343
Ace Woollahra Pty Ltd v The Owners--Strata Plan 61424 & Anor [2010] NSWCA 101
Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321; [1990] HCA 33
Beale v Government Insurance Office of New South Wales (1997) 48 NSWLR 430
Biggin and Co Ltd v Permanite Ltd (1951) 1 KB 422
Collins v Urban [2014] NSWCATAP 17
County Securities Pty Ltd v Challenger Group Holdings Pty Ltd [2008] NSWCA 193
DL v The Queen (2018) 266 CLR 1; [2018] HCA 26
Gallagher v Masters Installation Pty Ltd [2017] NSWCA 117
Gautam v Health Care Complaints Commission [2021] NSWCA 85
Giretti v Deputy Commissioner of Taxation (1996) 70 FCR 151
House v R (1936) 55 CLR 499
In the Matter of Richards Contracting Co Management Pty Ltd [2021] NSWCA 34
Jackamarra v Krakouer (1998) 195 CLR 516
John Prendergast & Vanessa Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69
Kavanagh v Blissett [2001] NSWCA 79
Kelly v Szatow [2020] NSWSC 407
Laws v GWS Machinery Pty Ltd [2007] NSWSC 316
Maxwell v Murphy (1957) 96 CLR 261
Minister for Immigration and Border Protection v WZARH (2015) 256 CLR 326, at 342; [2015] HCA 40
Minister for Immigration and Citizenship v SZMDS [2010] HCA 16
Minister for Immigration and Multicultural Affairs v Eshetu 197 CLR 61; [1999] HCA 21
Minister for Migration and Citizenship v Li (2013) 249 CLR 332
Moloney v Taylor [2016] NSWCA 199
New South Wales Police Force v Winter [2011] NSWCA 330
Ohlstein v E & T Lloyd [2006] NSWCA 226
Ortiz v Minister for Immigration and Citizenship [2011] FCA 1498
Polyukovish v Commonwealth (1991) 172 CLR 501; [1991] HCA 32
Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S20/2002 77 ALJR 1165; [2003] HCA 30
Robertson v City of Nunawading [1973] VR 819
Royal Guardian Mortgage Management Pty Ltd v Nguyen [2016] NSWCA 88
Salmon v Osmond [2015] NSWCA 42
Secretary, Department of Family and Community Services v Smith [2017] NSWCA 206
Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247
State Water Corporation v Civil Team Engineering Pty Ltd [2013] NSWSC 1879
Stead v State Government Insurance Commission (1986) 161 CLR 141; [1986] HCA 54
Stephens v The Queen [2022] HCA 31
Suvaal v Cessnock City Council (2003) 77 ALJR 1449; [2003] HCA 41 at [36]
Sze Tu v Lowe [2014] NSWCA 462
Targeted Property Investments Pty Ltd v Look Up Technologie Pty Ltd (No 2) [2023] NSWSC 416
Theo Holdings Pty Ltd v Hockey; Australian Competition And Consumer Commission v Theo Holdings Pty Ltd [2000] FCA 665; (2000) 99 FCR 232
Tomko v Palasty (No 2) [2007] NSWCA 369
Yuen v Thom [2016] NSWCATAP 243
Texts Cited: None cited
Category: Principal judgment
Parties: 2023/00003459:
Actol Pty Ltd (Appellant)
Rise Products Pty Ltd (First Respondent)
Daniel Pszczonka (Second Respondent)
Benth Holdings Pty Ltd t/as Gledswood Projects (Third Respondent)