Alam v Rahman

NCAT Appeal Panel|2024-07-15

Background

The appellant appeals against a decision of the Consumer and Commercial Division of the Tribunal on 8 April 2024 which required him to pay $500,000 to the respondents before 6 May 2024.
The parties entered into a contract for residential building work on 5 December 2020 in respect of premises at Airds, NSW 2560. The contract was terminated by the respondents by reason of the two-year delay in completion of the works. The respondents commenced proceedings on 10 August 2023 seeking damages for defective and incomplete work.
The hearing proceeded on 8 April 2024. By Notice of Order of the same date the Tribunal published its decision. Oral reasons for the decision were provided at the conclusion of the hearing.
The appellant filed a notice of appeal dated 7 May 2024.

The Notice of Appeal

The notice of appeal was filed on 7 May 2024. Amended grounds of appeal were filed on 6 June 2024 said to limit the remaining three grounds of appeal to errors on questions of law: 1. The Tribunal at first instance did not have jurisdiction to hear the matter pursuant to s48K of the Home Building Act 1989 (the HB Act). 2. The Tribunal at first instance failed to give adequate reasons; 3. The Tribunal at first instance failed to provide the Appellant with procedural fairness;

Submissions and evidence

In deciding the appeal, we have had regard to the following: 1. The Amended Notice of Appeal lodged on 6 June 2024; 2. The Respondent's Reply to Appeal lodged on 29 May 2024; 3. The Appellant's and the Respondent's respective amended written submissions; 4. The written materials respectively filed by the Appellant and the Respondent contained in the appeal book; and 5. The oral submissions made by and on behalf of the parties at the appeal hearing.

Nature of appeal

Internal appeals may be made as of right on a question of law, and otherwise with leave (that is, the permission) of the Appeal Panel: s 80(2) of the Civil and Administrative Tribunal Act 2013 (NSW) ("the NCAT Act").
Internal appeals involve consideration of whether there has been any error on a question of law; or any other error sufficient to grant leave to appeal under Cl. 12 of Sch. 4 of the NCAT Act.
An appeal is not simply an opportunity for a dissatisfied or aggrieved party to re-argue the case they put at first instance: Ryan v BKB Motor Vehicle Repairs Pty Ltd [2017] NSWCATAP 39 at [10].
In Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69 ('Prendergast') the Appeal Panel set out at [13] a non-exclusive list of questions of law: 1. Whether there has been a failure to provide proper reasons. 2. Whether the Tribunal identified the wrong issue or asked the wrong question. 3. Whether a wrong principle of law had been applied. 4. Whether there was a failure to afford procedural fairness. 5. Whether the Tribunal failed to take into account relevant (i.e., mandatory) considerations. 6. Whether the Tribunal took into account an irrelevant consideration. 7. Whether there was no evidence to support a finding of fact; and 8. Whether the decision is so unreasonable that no reasonable decision-maker would make it.
The circumstances in which the Appeal Panel may grant leave to appeal from decisions made in the Consumer and Commercial Division are constrained by Cl. 12 (1) of Sch. 4 of the NCAT Act. In such cases, the Appeal Panel must first be satisfied 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).
In Collins v Urban, the Appeal Panel stated at [76] that a substantial miscarriage of justice for the purposes of Cl. 12 (1) of Sch. 4 may have been suffered where: … there 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.
Even if an appellant from a decision of the Consumer and Commercial Division requiring leave to appeal has satisfied the requirements of Cl. 12 (1) of Sch. 4 of the NCAT Act, the Appeal Panel must still consider whether it should exercise its discretion to grant leave to appeal under s 80 (2) (b) of the NCAT Act.
In Collins v Urban, the Appeal Panel stated at [84] that ordinarily it is appropriate to grant leave to appeal only in matters that involve: (a) issues of principle; (b) questions of public importance or matters of administration or policy which might have general application; (c) an injustice which is reasonably clear, in the sense of going beyond merely what is arguable, or an error that is plain and readily apparent which is central to the Tribunal's decision and not merely peripheral, so that it would be unjust to allow the finding to stand; (d) a factual error that was unreasonably arrived at and clearly mistaken; or (e) the Tribunal having gone about the fact finding process in such an unorthodox manner or in such a way that it was likely to produce an unfair result so that it would be in the interests of justice for it to be reviewed.
Even if the appellant establishes that he may have suffered a substantial miscarriage of justice in the sense explained above, the Appeal Panel retains discretion whether to grant leave under s 80 (2) of the NCAT Act. The appellant must demonstrate something more than the Tribunal was arguably wrong (Pholi v Wearne [2014] NSWCATAP 78 at [32]).

Jurisdiction of the Tribunal in Home Building Proceedings.

It is the appellant's contention that the Tribunal had no jurisdiction to hear and determine the respondents' application because the 'claim as made' exceeded the jurisdictional limit of $500,000 (see amended grounds of appeal at page 403 of the appeal bundle).
We accept that this ground of appeal raises an error on a question of law for which the leave of this Appeal Panel is not required.
The appellant concedes that the points of claim filed in these proceedings did not particularise amounts claimed relating to the rectification and completion of the building work. However, it is the appellant's contention that the appellant filed and served an expert report of Mr Steven Nakhla in which the executive summary and scott schedule attached to the report claimed the cost of the rectification works in the amount of $537,795.32.
In respect of rental costs and consequential losses the respondents also claimed approximately $50,000 in rental expenses from the date the construction was meant to have been completed in accordance with the terms of the contract. The appellant maintains that the actual 'claim as made' by the owner therefore amounted to $583,867.07. As this exceeded the jurisdictional limit of the Tribunal, the Tribunal was never seized of jurisdiction.
For the reasons that follow we disagree.
The jurisdiction of the Tribunal generally in home building disputes arises from the provisions of ss 48A and 48K of the HB Act. 48K JURISDICTION OF TRIBUNAL IN RELATION TO BUILDING CLAIMS (1) The Tribunal has jurisdiction to hear and determine any building claim brought before it in accordance with this Part in which the amount claimed does not exceed $500,000 (or any other higher or lower figure prescribed by the regulations). (2) The Tribunal has jurisdiction to hear and determine any building claim whether or not the matter to which the claim relates arose before or after the commencement of this Division, except as provided by this section. (3) The Tribunal does not have jurisdiction in respect of a building claim relating to building goods or services that have been supplied to or for the claimant if the date on which the claim was lodged is more than 3 years after the date on which the supply was made (or, if made in instalments, the date on which the supply was last made). (4) The Tribunal does not have jurisdiction in respect of a building claim relating to building goods or services that are required under a contract to be supplied to or for the claimant on or by a specified date or within a specified period but which have not been so supplied if the date on which the claim was lodged is more than 3 years after the date on or by which the supply was required under the contract to be made or, if required to be made in instalments, the last date on which the supply was required to be made. (5) The fact that a building claim arises out of a contract that also involves the sale of land does not prevent the Tribunal from hearing that building claim. (6) The Tribunal does not have jurisdiction in respect of a building claim arising out of a building cover contract required to be entered into under this Act if the date on which the claim was lodged is more than 10 years after the date on which the residential building work the subject of the claim was completed. (7) The Tribunal does not have jurisdiction in respect of a building claim arising from a breach of a statutory warranty implied under Part 2C if the date on which the claim is lodged is after the end of the period within which proceedings for a breach of the statutory warranty must be commenced (as provided by section 18E). (8) The Tribunal does not have jurisdiction in respect of a building claim relating to-- (a) a contract for the supply of goods or services to which none of subsections (3), (4), (6) and (7) applies, or (b) a collateral contract, if the date on which the claim was lodged is more than 3 years after the date on which the contract was entered into. (9) This section has effect despite clause 5 (Relationship between Tribunal and courts and other bodies in connection with Division functions) of Schedule 4 to the Civil and Administrative Tribunal Act 2013.
The builder submits that the Tribunal never had jurisdiction to hear and determine application 2024/380807 because the amount claimed by the appellant exceeded the jurisdictional limit of the Tribunal which was, at all relevant times, $500,000 (see 48K(1)).
However, the Tribunal dealt with the issue of jurisdiction on the basis that the amount claimed by the respondents was particularised in the opening remarks by counsel and as found in the exchange of the parties at page 16 of the transcript: General Member Hennings: What are you seeking today? What is the total sum? Folino-Gallo: The total sum of what's being sought is the jurisdictional limit of the Tribunal. So the total claim amount is $526,000. The applicant is content with confining its claim so as to fall within the Tribunal's jurisdiction.
The appellant suggests that the amount claimed was $583,000. However nowhere in the transcript or the pleadings is it apparent that the respondents made that claim before the Tribunal.
It is clear from the exchange set out above that the Tribunal Member satisfied himself that he had jurisdiction to determine the building claim.
A building claim is defined in s 48A as a claim for: '(a) the payment of a specified sum of money, or (b) the supply of specified services, or (c) relief from payment of a specified sum of money, or (d) the delivery, return or replacement of specified goods or goods of a specified description, or (e) a combination of two or more of the remedies referred to in paragraphs (a)-(d), (f) that arises from a supply of building goods or services whether under a contract or not, or that arises under a contract that is collateral to a contract for the supply of building goods or services, but does not include a claim that the regulations declare not to be a building claim."
Section 48I permits such claims to be brought to the Tribunal on application and also makes provision for their withdrawal.
The application was made on 10 August 2023 by the filing with the registry a document entitled Consumer and Commercial Division Application form. There was no question that it was brought well within the Tribunal's jurisdiction, being for a "building claim" as defined in s 48A and 48K for an amount of $375,000. It has never been amended.
The making of an application to the Tribunal is governed by s 40 of the Civil and Administrative Tribunal Act 2013 which required an application to be made in writing in the appropriate form, in accordance with the Civil and Administrative Tribunal Rules 2014 (r24). In proceedings brought under s 48K of the HB Act, it was the application form which commences the proceedings by which the Tribunal's jurisdiction was enlivened. Section 48K empowers the Tribunal to deal with "any building claim brought before it in accordance with this Part in which the amount claimed does not exceed $500,000". At no stage was the application amended, nor was an amount sought that exceeded the jurisdictional limit of $500,000.
It follows that, contrary to the case advanced for the appellant in this appeal proceedings, as the application brought before the Tribunal was not formally amended to increase the amount claimed beyond the statutory limit, the claim as made remained at all relevant times within the Tribunal's jurisdiction.
The appellant's submissions are contained at page 401 of the appeal bundle. In summary the appellant submits that various communications sent by the appellant to the solicitor for the respondents, setting out particulars of loss detailed in a scott schedule, plus a claim for lost rent, determines that the amount as claimed is in the sum of $578,000. It is submitted that the communications exchanged and the expert reports served inform the amount claimed and that the evidence exchanged before the hearing determines that the claim as made is beyond the Tribunal's jurisdiction. We disagree with that submissions. Section 48K confines the Tribunal's jurisdiction under the Act to claims brought to the Tribunal which fall below the specified amount, and a claim is not made by service of evidence or by providing particulars, particularly as the Tribunal is not a Tribunal of strict pleadings. The amount as claimed before the Tribunal is determinative, The Owners - Strata Plan No. 70030 v Decon Australia Pty Ltd [2014] NSWSC 347.
For these reasons we are not of the view that the claim as made exceeded the jurisdictional limit of the Tribunal. No error on a question of law has been established. This ground of appeal is dismissed.

The Tribunal failed to give adequate reasons.

We accept that a failure to give adequate reasons is an error on a question of law for which the leave of the Appeal Panel is not required.
The appellant submits that the Member gave oral reasons for decision which were deficient because they gave "summary consideration" to the expert report of Mr Nakhla and the lay evidence of the respondents. "Little consideration is given to the submissions of the Appellant and any matters raised. The brief ex tempore remarks are not of a standard that is sufficient to meet the demands of a claim in excess of $500,000 and for this reason, the Decision lacked sufficient reasons and is accordingly affected by appealable error."
We have had regard to the Member's reasons that are transcribed at appeal book pp 341 to 345. The critical findings made by the Member are as follows. 1. The parties entered into a contract for residential building work dated 6 December 2022 for a dwelling in Bradbury, New South Wales. 2. The contract is a standard form New South Wales residential building contract. 3. There was an anticipated term of the contract for the residential building work to be completed in an orthodox time frame of 32 weeks; 4. The builder commenced the work and the respondent's made payments in accordance with the contract from time to time; 5. Due to the appellant's delay the respondents terminated the contract in accordance with the terms of the contract; 6. The appellants commenced proceedings for defective and incomplete work on 10 August 2023; 7. The application was lodged in time; 8. The Tribunal has jurisdiction to hear and determine the matters as the application is a building claim to which s48K of the HB Act applies; 9. The respondents filed and served evidence in support of the application in accordance with the Directions of the Tribunal; 10. The expert report of Mr Steven Nakhla of SJN Building Consultants identified the nature of the defective and incomplete work; 11. The appellant has not participated in the proceedings and there is no explanation why the appellant has failed to comply with Directions over a period of 8 months and has not filed or served evidence in response to the claim; 12. The respondents' claims for breach of defective and incomplete works are proven on the basis of the uncontested evidence of the respondents' expert report. The report includes costings in respect of rectifying defects as well as completing the works and the Tribunal makes a finding and order for damages for defective work in the sum of $65,404.55 and $402,390 to complete the contractual work. 13. The Tribunal accepts the uncontested and uncontroverted evidence of the Tribunal for loss of rent and water charges in the sum of $24,293.70 and $2,911.75 respectively.
No submissions have been made seeking to impugn the factual findings as made nor is it submitted that the Tribunal fell into error in making final orders for the various damages awarded for breach of statutory warranties under the HB Act and at common law. The submissions simply state 'the reasons are not of a standard that is sufficient to meet the demands of a claim in excess of $500,000 and for this reason the Decision lacked sufficient reasons and is accordingly affected by appealable error'.
To the extent that this ground raises the question of whether the Tribunal failed to give adequate reasons, that may raise a question of law: Wollondilly Shire Council v Styles [2024] NSWCATAP 104 at [29]. However, it is necessary to identify the particular question: Ferella & Anor v Chief Commissioner of State Revenue [2014] NSWCA 378 at [22], Wollondilly at [29].
We have taken the particular question here to be whether the statutory duty under s 62 of the NCAT Act has been satisfied; or whether the oral reasons otherwise were sufficient to alert the appellant to the facts, law and reasoning process for the decision.
With respect to the oral reasons as transcribed, the Appeal Panel is satisfied that there is no inadequacy of reasons. In this case, the Tribunal identified the facts, the evidence, the law and the reasoning process: New South Wales Land and Housing Corporation v Orr [2019] NSWCA 231 at [71] per Bell P (Ward JA agreeing). On appeal, it is not required to determine the optimal level of detail required in reasons for a decision but rather the minimum acceptable standard. For the reasons we have given, the Tribunal's reasons comply with the minimum acceptable standard.
The appellant has failed to establish an error on a question of law and this ground of appeal is dismissed.

The Tribunal at first instance failed to afford the appellant procedural fairness by refusing the adjournment application

The submissions are contained at page 408 of the Appeal Book: In the present matter the appellant was denied an adjournment by the Tribunal Member at first instance. Although the Appellant had previously not engaged with the Tribunal process, he sought an adjournment to obtain legal advice and to prosecute his claim. In response the Tribunal member required that the costs of the proceedings be paid forthwith by the Appellant. When the Appellant advised he was not able to do so (even offering to pay at a later date), the Tribunal member refused the adjournment application. … By demanding the immediate payment of the costs of the hearing, the Appellant was not afforded a proper opportunity to obtain separate legal advice and representation. Such an approach was inappropriate and cause the Tribunal at first instance to fall into error.
We have had regard to the transcript reference provided by the appellant. The Tribunal provided detailed oral reasons for the refusal of the adjournment application at page 15 of the transcript. The Member found 1. The proceedings were lodged in August 2023 and although eight months have passed the appellant appears for the first time at the final hearing to engage with the Tribunal process; 2. The applicant is unrepresented and seeks an adjournment to obtain legal advice; 3. The respondents oppose the application for adjournment; 4. The appellant is impecunious and refuses to pay the costs thrown away by the adjournment forthwith or at all; 5. The appellant provided no evidence to support his contention that he has been in contact with the respondents to arrange for the residential building works to continue; a proposition denied by the respondents. 6. There is no explanation why the appellant has failed to appear at previous hearings and has failed to obtain representation before the final hearing;
In Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Limited [2013] HCA 46, a unanimous High Court said: "In Aon Risk Services Australia Ltd v Australian National University, it was pointed out that case management is an accepted aspect of the system of civil justice administered by the courts in Australia. It had been recognised some time ago by courts in the common law world that a different approach was required to tackle the problems of delay and cost in the litigation process. Speed and efficiency, in the sense of minimum delay and expense, are essential to a just resolution of proceedings. The achievement of a just but timely and cost-effective resolution of a dispute has effects not only upon the parties to the dispute but upon the court and other litigants. The decision in Aon Risk Services Australia Ltd v Australian National University was concerned with the Court Procedures Rules 2006 (ACT) as they applied to amendments to pleadings. However, the decision confirmed as correct an approach to interlocutory proceedings which has regard to the wider objects of the administration of justice."
That approach is applicable in this Tribunal. Section 36(1) of the Civil and Administrative Tribunal Act 2013 ('the Act') is in relevantly identical terms to s 56(1) of the Civil Procedure Act 2005, the provision considered in the Expense Reduction decision.
It follows that a number of principles apply to applications for an adjournment: 1. matters should almost always proceed on the date fixed for hearing, for the reasons enunciated above, 2. an application for an adjournment should be seen as the exceptional rather than the ordinary course; 3. where the adjournment is caused, at least in part, by the delay of the party seeking the adjournment, or non-compliance by that party with an extant order of the Tribunal, adequate explanation is called for, and its absence weighs heavily, and sometimes decisively against the grant of an adjournment.
Further, there is the effect on the opposing party to consider. In Sayhoun v Owners Corporation Strata Plan 75123 [2014] NSWCATAP 112, an Appeal panel of this Tribunal said at [17], in terms we would adopt: "We are satisfied that the respondent would be prejudiced if an extension of time were granted. That prejudice may be addressed by an award of costs, although we note the remarks of the plurality in Aon Risk Services Aust Pty Ltd v Australian National University [2009] HCA 27; (2009) 239 CLR 175 at [100] that justice cannot always be measured in money and that a judge is entitled to weigh in the balance the strain the litigation imposes upon litigants; and their approval (also at [100]) of Bowen LJ's statement in Cropper v Smith [1884] 26 Ch D 700 that: Non-compensable inconvenience and stress on individuals are significant elements of modern litigation. Costs recoverable even on an indemnity basis will not compensate for time lost and duplication incurred where litigation is delayed or corrective orders necessary."
The gravamen of the appellant's complaint is that the adjournment was refused because Mr Alam was unwilling and unable to pay the costs thrown away of the adjournment, if granted (TP 15 L 30). We are not of the view that the Member's discretion to refuse the adjournment application miscarried. Having regard to the authorities set out above, the Tribunal was correct to take into account the failure by the appellant to engage in the Tribunal process in any meaningful way. The prejudice to the other side was significant and the respondents advised the Tribunal that the costs thrown away by adjourning the hearing would be $8800. The Member, correctly in our view, decided that the hearing should not be adjourned unless the respondent agreed to an order to pay the costs thrown away. The appellant indicated he was neither willing nor able to pay the respondents' costs and in those circumstances the Member correctly decided that the prejudice to the respondents could not be adequately compensated for by a costs order.
The decision made by the Tribunal to refuse to adjourn the hearing listed for 8 April 2024 is in the nature of an "interlocutory decision". Therefore, the appellant requires leave to appeal from that decision: NCAT Act, s 80(2)(a).
The appellant asserts that as a consequence of the adjournment decision he was denied procedural fairness. He asserts that that decision was in error but fails to explain the basis for that assertion. In addition, the appellant fails to identify the practical injustice he is said to have suffered as a result of the adjournment decision. Nor did he identify which of the factors listed in Collins might warrant the exercise of the discretion to grant leave to appeal from the adjournment decision.
The appellant has failed to identify the basis for the assertion that the Tribunal erred in the exercise of the discretion to refuse to grant an adjournment. The adjournment decision raises no issue of general principle or importance and is confined to its specific facts. We are not of the view that the exercise of the Member's discretion to refuse the adjournment miscarried.
Accordingly, we decline to grant leave and this ground is dismissed.

Orders 1. Leave to appeal refused. 2. Appeal dismissed. 3. Subject to the outcome of any costs application pursuant to order (4) below, the appellant is to pay the respondent's costs of the appeal on the ordinary basis as agreed or assessed. 4. If any party wishes to make an application to vary order 3, the applicant (the costs applicant) must file and serve a costs application in the form of an Application for Miscellaneous Matters, including submissions limited to five pages and any evidence in support, within 14 days of the date of these orders. 5. The respondent to the costs application is to file and serve any submissions, limited to five pages, and any evidence in reply within 14 days thereafter. 6. The Appeal Panel may dispense with a hearing and determine any application for costs on the basis of the written submissions and evidence provided. If the parties oppose this course, they should make submissions on this issue when complying with the directions as to their submissions on the substantive costs 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 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: 26 July 2024

BUILDING AND CONSTRUCTION---Home Building Act 1989(NSW)

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Judgment (9 paragraphs)

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Legislation Cited (4)

Cases Cited (12)