Ambs v Fraser

NCAT Consumer and Commercial|2017-10-09

Judgment

On 18 February 2017 Ms Janette Ambs (the applicant) applied to the Tribunal for orders that Mr Wayne Fraser (the respondent) pay her $31,400.00; that he return goods to the value of $10,000.00; and that he do work or services to the value of $15,000.00. Ms Ambs stated in her application that the respondent had failed to provide the business and company advice services she contracted for, that he had failed to return all her personal and accounting records which would have to be recreated, and that she would be liable for additional accounting and legal costs to correct her affairs.
The parties were unable to reach any settlement at the conciliation and group hearing on 28 March 2017. Both parties were legally represented on that occasion. Leave was granted for both parties to be legally represented. Directions were made for the respondent to request and the applicant to provide particulars of the claim. At the next directions hearing on 22 May 2017, at which both parties were legally represented, directions were made for the parties to provide their evidence. On 26 June 2017 the applicant requested an extension of time to provide her documents to 30 June 2017, and on 30 June 2017 requested an extension of time to 4 July 2017. That request was granted, the time for provision of evidence was extended for both parties, and the hearing listed for 21 July 2017 was adjourned.
The matter was listed for hearing on 8 September 2017. On 3 July 2017 the applicant requested an adjournment on the basis that her solicitor was not available. That request was granted. The matter was then listed for hearing on 9 October 2017. On 4 October 2017 Mr Autore, the applicant's solicitor, advised the Tribunal that he no longer held instructions in the matter.

Background

It was common ground that the applicant was introduced to the respondent through a third party in November 2015. The applicant had separated from her husband in 2014. The financial arrangements involving the applicant and her former husband (an accountant) were complex, as demonstrated in a document provided by the applicant to the respondent on 12 November 2015 (Annexure 8 to the affidavit of 10 July 2017). That document identifies a number of trusts, a superannuation fund, and several corporate entities, which included Abfackeln Investments Pty Ltd (Abfackeln) for which the applicant was sole shareholder and officeholder.
The dispute in these proceedings relates to services provided by the respondent to the applicant after that meeting, against the background of the family law negotiations. The applicant states that she knew that the respondent was an Insolvency and Reconstruction Specialist. In a curriculum vitae annexed to his affidavit the respondent describes himself as Principal Consultant to Liquidion Consulting, and that he specialises in Recovery and Reconstruction of corporate clients.
Relations between the parties had soured by September 2016. On 29 September 2016 the applicant's then lawyer wrote to the respondent (Annexure 17), with a request for a written report and the return of company registers and other financial documents, a refund of various amounts paid to the respondent, and reimbursement for an ASIC fine. The respondent replied by email dated 6 October 2016 (Annexure 18), disputing the claims made in that letter.
The applicant makes a number of allegations in an affidavit filed on 5 October 2017 as to the involvement of the respondent's solicitor in legal matters concerning her ex-husband, including his family law matters. The applicant also complains about a number of invoices issued to her dated 7 October 2016 which she states are false or unjustified. The applicant further complains that the respondent acted on matters outside the scope of the work required under the contract, including in giving her advice on legal matters. The respondent makes a number of allegations against the applicant in relation to complaints made about him to ASIC. Those matters are not relevant to these proceedings, which concern whether or not the applicant has established an entitlement to a refund of money paid to the respondent in the course of his provision of services to her.

The Claim

Ms Ambs stated at the hearing that she is seeking an order that the respondent pay her the sum of $24,050.00, plus legal costs of $4,200.00 and printing costs of $300.00.
In her affidavit of 10 July 2017 Ms Ambs provides details of the five contracts in respect of which she is claiming, and the amount claimed in respect of each contract; her claim for return of documents; and her claim that the respondent has engaged in deceptive and misleading conduct. The following summary of the elements of the claim is based on that affidavit.

Contract 1: Head Contract of Engagement - $11,000.00

As described by the applicant, this contract was for the respondent to: 1. Review the relevant material and provide a Financial Expert Report containing an expert opinion regarding the financial matters of herself and her ex-husband; 2. The report was intended for the Family Court and was required to written according to the Court Rules; and 3. Review tax compliance for herself and all associated entities.
Ms Ambs states that the respondent did not comply with his obligations to provide the services he had been paid for, in that he failed to prepare and complete an Expert Financial Report for the Family Court, rather he sent an email without an expert certificate; and she has not received any Expert Financial Report which satisfies court rules. There was never an agreement that the Expert Financial Report costing $11,000.00 would be the sum of one letter.
Ms Ambs states that reliant on the respondent's false, misleading and deceptive advice, she engaged him to do other work for her which resulted in further invoices for services. Most of those services were an unnecessary wasted exercise. The specific additional contracts in respect of which she is claiming a refund, and the amounts claimed, are as follows.

Contract 2: Liquidation of Abfackeln Investments Pty Ltd - $10,000.00

On 8 January 2016 the respondent convinced her that liquidating Abfackeln was urgent and imperative. She paid $10,000.00 on 12 January 2016 for the appointment of Hall, Chadwick to liquidate Abfackeln, with payment of the balance of $15,000.00 to be made by monthly instalments from her credit card.
The respondent did not comply with his obligation to provide the services he was paid for, and failed to: 1. Execute the liquidation of Abfackeln Investments Pty Ltd; 2. Make arrangements and appoint Hall, Chadwick Liquidators; and 3. Forward her $10,000.00 payment to Hall Chadwick and arrange for her credit card to be debited by Hall Chadwick.

Contract 3: New Company - $1,400.00

On 8 January 2016 she was persuaded to set up a new company for the purpose of: 1. transferring an insurance policy from Abfackeln Investments Pty Ltd so that the liquidation of that company could proceed; and 2. enabling her to trade in her small home business as a massage therapist.
The respondent was paid $1,400.00 in August 2016 from the balance of a partial refund for her having paid twice for the company transfer/sale of Abfackeln. The respondent failed to meet his contractual obligations in failing to: 1. obtain her signature and provide advice on the relevant documents as Director Secretary and Shareholder prior to lodging the Form 201 with ASIC; 2. register an ABN for the new company Phoenix Four (NSW) Pty Ltd ; 3. provide her with correct company documents; 4. ensure her surname was recorded as "Ambs", as the original documents had it as "Pickering"; and 5. inform her that he had appointed himself as agent to her companies and that mail from ASIC would go to his address, causing her to incur late payment penalties of $316.00.
The applicant claims that the respondent also overcharged her, as she was invoiced $1,980.00 whereas "Cleardocs" charges $616.50 to register a company.

Contract 4: Sale of Abfackeln Investments Pty Ltd - $0

At a meeting around 17 May 2016 the applicant paid $5,500.00 by credit card for financial services including: 1. inquiry about and provision of advice on the intended sale of Abfackeln ownership rights; 2. to arrange for a purchaser of the company who would accept liabilities for Abfackeln; and 3. to execute sale of rights and ownership for Abfackeln.
The respondent failed to : 1. Execute the sale of rights and ownership of Abfackeln; 2. Provide proper advice or answer her queries in relation to the transfer of Abfackeln; 3. act with honesty, in that he advised her that it was possible for him to get back the $10,000.00 he had allegedly paid to Hall Chadwick on her behalf and that he could stop the liquidation so the company could be sold instead.

Contract 5: Personal Income Tax Returns - $1,650.00

The respondent was asked to prepare and lodge her individual tax return for 2015 and attend meetings and provide advice. She paid $1,650.00 in cash. The respondent did provide the tax return however it contained factually incorrect financial data, and she could not sign off on her 2015 tax return.

Documents

In her affidavit Ms Ambs states that the respondent has not returned her material documents as requested first on 23 August 2016, with later requests by her and her lawyer.

Deceptive and misleading conduct

Ms Ambs states that the respondent has engaged in deceptive and misleading conduct including: 1. The absence of any business signage or permanent office; 2. No ABN/ACN shown on his business cards; 3. Use of various valid and invalid (deregistered) business entities; and 4. Invoicing from various business entities.

Respondent's case

The respondent states that he did not attempt to gain the trust of the applicant in order to manipulate or deceive her and she was referred to him as a business transaction. He has referred the applicant to financial planners and solicitors when he has lacked the relevant knowledge. He carried out the work for Contract 1, and did not use scare tactics, fear threats or bad faith to convince the applicant to engage him for unnecessary and costly services in the form of Contracts 2, 3, 4 and 5. The respondent provided responses to the issues raised by the applicant in relation to each of those contracts in his affidavit and oral evidence, as discussed below.
In oral submissions the respondent submits that he performed the work required under Contracts 1, 2, and 3; and that the work for Contract 5 was carried out by Freedom Taxation and not by him. There is no expert evidence to support a claim that any of the work was not done with due care and skill. The respondent submits that he personally would not in any event be liable for any breach of Contract 1, which was between the applicant and Liquidion Consulting.

Jurisdiction

The jurisdiction of the Tribunal in determining a consumer claim is conferred by Part 6A of the Fair Trading Act 1987 (the FT Act). A "consumer claim" is defined in s 79E of the FT Act: 79E Meaning of "consumer claim" (1) For the purposes of this Part, a consumer claim means a claim by a consumer, for one or more of the following remedies, that arises from a supply of goods or services by a supplier to the consumer (whether or not under a contract) or that arises under a contract that is collateral to a contract for the supply of goods or services: (a) the payment of a specified sum of money, (b) the supply of specified services, (c) relief from payment of a specified sum of money, (d) the delivery, return or replacement of specified goods or goods of a specified description. …
Ms Ambs is claiming payment of a specified sum of money, and for return of goods, arising from supply of services falling within the definition of "services" in s 79F(1)(a) of the FT Act. The services were supplied in New South Wales (s 79K(1)(a)), and the application to the Tribunal was lodged within the period specified in s 79L. The amount claimed is within the jurisdictional limit of the Tribunal: s 79S. The Tribunal has jurisdiction to determine the claim.
Part 6A of the FT Act does not create any cause of action, and is predicated on the existence of causes of action that arise independently of Part 6A. There must be a cause of action, for example in contract, tort, or arising under a statute, which provides a legitimate basis for the consumer to make the claim and for the Tribunal, based on the legal entitlements of the parties under the cause or causes of action on which the claim is based, to make any of the orders specified in s 79N of the FT Act: Lam v Steve Jarvin Motors Pty Ltd [2016] NSWCATAP 186; Matumaini v Automobile Industries Pty Ltd [2017] NSWCATAP 93.
As noted above, the applicant has been legally represented throughout the course of these proceedings until shortly before the hearing. In her statement filed on 5 October 2017 in response to the respondent's affidavit, after her solicitor had ceased to act, the applicant stated that she was not seeking an adjournment of the hearing to obtain further legal representation. She stated that she needed to achieve resolution of the matter as it has been ongoing since February 2017 and that she is also trying to resolve her complex family law matter which has been ongoing since the end of 2014.
The directions made on 28 March 2017 refer to the provision of particulars of the claim. It would appear, based on correspondence between the respondent's lawyer and the applicant's then lawyer, that a request was made on 11 April 2017 for particulars, with follow up requests on 12 May 2017, 25 May 2017 and 8 June 2017. There is no indication in the documents provided to the Tribunal that that request was complied with.
In the absence of particulars, and bearing in mind that the applicant did not have the benefit of legal representation at the hearing, the Tribunal has considered the claims made by the applicant as outlined in her affidavit, which was prepared when she was legally represented. Those claims are for a refund based on breach of contract for the performance of services under the five contracts identified in the affidavit, and in the alternative, that the respondent engaged in false, misleading and deceptive conduct, in breach of relevant consumer guarantees under the Australian Consumer Law (NSW). The applicant identifies in her affidavit other invoices which she disputes, however her claim in these proceedings, as confirmed at the hearing, does not include any claim for relief from payment of a specified sum of money. Accordingly, the Tribunal is determining the claim for a refund, and for return of the documents.
In the following discussion references to specific documents are to the documents provided as annexures to the applicant's affidavit of 10 July 2017, unless otherwise specified.

Breach of contract

The applicant's claims in contract are based on the contention that the services contracted for in the five contracts to which she and the respondent were parties were not performed at all, or were performed otherwise than with the due care and skill required.
It is the applicant in who bears the onus of proof in respect of proving the terms of each of the five contracts, and that the contract has been breached in circumstances giving rise to a right, as claimed in these proceedings, for a refund of the amounts paid. For the Tribunal to determine that the applicant is entitled to be reimbursed any money the applicant must satisfy the Tribunal that the work was not done in accordance with each of the contracts.

Contract 1

The respondent disputes that he was in a contractual relationship with the applicant, or that he did not perform the services as contracted. The respondent's representative submitted at the hearing that the applicant could not bring her claim in relation to Contract 1 against the respondent as that contract was made between her and Liquidion Consulting, and not the respondent.
That contention was not raised by the respondent at the earlier directions hearings, when the applicant was legally represented, in the request for particulars, or in the documentary evidence filed on behalf of the respondent, including in the respondent's affidavit. The only reference comes in a letter dated 21 March 2017 to the applicant (tab 24 respondent's affidavit), in which the respondent's lawyer states that the respondent "did provide professional services initially through a corporate entity, and subsequently, following a restructure of his business, as a sole proprietor". In support of this contention the respondent's representative provided at the hearing an ASIC extract for ACN 605 650 182 Pty Ltd, (formerly called Liquidion Bookkeeping Pty Ltd between 5 May 2015- 2 June 2016), to which liquidators were appointed on 19 July 2016. The former shareholders included Liquidion Properties Pty Ltd with a registered address that of the respondent in Galston, and naming Tamar Fraser as Secretary and Director between 5 May 2015-5 May 2015.
The first issue to determine is the identity of the contracting parties. The test is what a reasonable observer would conclude from the objective evidence of the communications that led to the entry into the contract, together with the background facts known to the parties: Pethybridge v Stedikas Holdings Pty Ltd [2007] NSWCA 154. Evidence of subsequent communications, such as letterhead used to make the requests for progress payments, or account details into which payments are made (Suncorp Metway Insurance Ltd v Owners Corporation SP 64487 [2009] NSWCA 223) may constitute an admission of the existence or non-existence of a subsisting contract: Tomko v Palasty [2007] NSWCA 258.
It was common ground that after a telephone conversation the parties met on 30 November 2015, and that at the conclusion of that meeting the applicant transferred her collection of files and documents into the respondent's car. The business card which the applicant states was provided to her at the meeting of 30 November 2015, and which was not disputed, shows the respondent's name and "Liquidion Insolvency & Reconstruction", with no ABN recorded.
Ms Ambs had already sent copies of financial documents to the respondent by a series of emails (Annexures 8, 9, 10, 11 and 12), including: 1. on 12 November 2015: documents including "Abfackeln Investment Trust Bal Sheet - June 2014", "Assets & Liabilities 28 Nov 2014", Pickham Group Structure Nov 11", "Entities that Anthony Pickham is associated with"; 2. on 14 November 2015: "A & J Superfund Returns 2009-2013", and tax returns; 3. on 14 November 2015: an email with a "list of tax problems that I need to discuss with you". That email refers to completion of a consent order form; 4. on 17 November 2015: ASIC company extracts for Abfackeln and another company, which had been provided by the solicitor then acting on her family law matters; and 5. on 24 November 2015: an email enclosing correspondence between the lawyers acting in the family law proceedings.
The signed version of Contract 1 (Annexure 7) is dated 25 November 2015, in a document headed "Terms of Engagement" on letterhead "Liquidion Insolvency & Reconstruction", citing ABN 15 605 650 182. The covering letter dated 25 November 2015 bears the same letterhead and ABN. The covering letter and Terms of Engagement are signed by Tamar Fraser above the name "Wayne Fraser". Both documents are "Signed and agreed by" the applicant.
Invoice No 00000016 (Annexure 6) dated 25 November 2015 for "Our professional fees in terms of our engagement letter dated 25 November 2015" for $11,000.00 (including GST) is in the name of "Liquidion Consulting", with the same ABN as that recorded on the Terms of Engagement. The payment section of the invoice provides bank account details for "Liquidion Consulting". It was common ground that the applicant signed the contract on 11 December 2015 and paid that invoice.
There is no reference in any of the documents recording the entry into Contract 1, including a draft copy incorrectly naming the applicant (Annexure 5), or in the emails referred to above leading up to the entry into the contract, or in the invoice or payment details, to an ACN. There is nothing in those documents to suggest that the contracting party was a company, whether Liquidion Bookkeeping Pty Ltd, or any other corporate entity associated with the respondent, or that any such entity was trading as "Liquidion Consulting".
Annexure 55 to the applicant's affidavit is an ASIC extract for ACN 168 411 130 Pty Ltd, named Liquidion Consulting Pty Ltd from 6 March 2014 to 26 April 2015; the respondent and Tamar Fraser are named as officeholders to 30 June 2014. There is no reference in any of the documents to suggest that that was the contracting party: and in any event, that company went into liquidation on 13 May 2015, some six months before the entry into Contract 1.
The applicant's oral evidence was that she believed that she was contracting with the respondent personally. However, that subjective belief does not govern consideration of who the contracting parties were. Equally, the respondent's acknowledgement in oral evidence, consistent with his affidavit, that he personally carried out the work does not necessarily mean that it was he who had entered into the contract. Based on the communications that led to the formation of the contract, the contractual documentation dated 25 November 2015, and the invoice issued on the same date, the Tribunal is satisfied that it would be open to a reasonable observer to conclude that the contract was between the applicant and whoever was carrying on the provision of financial services under the business name "Liquidion Consulting".
Neither party provided an extract from the Australian Business Register for ABN 15 605 650 182. The statement by the respondent's lawyer in his letter of 21 March 2017 (see above at para [38]) does not shed any light on which corporate entity may have been used by the respondent, or more importantly when he changed to operating as a sole proprietor. In contrast with Pethybridge, there were no objective indications in the documents, for example by the inclusion of an ACN, that the contract was one with a corporation.
To the extent that it may be permissible to have regard to post-contract communications and documents, the conclusion that the contracting parties were the applicant and the respondent is not inconsistent with the invoices provided by the respondent for the various transactions between November 2015 to April 2016. Three (25 November 2015, 13 January 2016, 22 February 2016) are in the name of "Liquidion Consulting" (ABN 15 605 650 182), with bank account details for payment to "Liquidion Consulting". The invoice dated 21 April 2016 is also in the name "Liquidion Consulting" (ABN 94 469 080 320), with bank account details for "Liquidion Consulting". The invoice dated 28 April 2016 is in the name of "Wayne Fraser", with bank account payment details for that name. None of those invoices, including details of the bank accounts into which payments are to be made, identify any person other than Wayne Fraser, or any corporation, carrying on the business of providing the financial services to the applicant.
The Tribunal is satisfied that on the objective evidence the conclusion can be drawn that a reasonable observer of the communications that led to the entering of the contract, together with the background facts known to the parties, would conclude that the contracting parties were the applicant and the respondent. On that basis, the Tribunal finds that the parties to the contract were the applicant and the respondent.
However, even if that conclusion is correct, the issue is whether applicant has established a breach.
The first issue to determine is what were the terms of the contract. The covering letter dated 25 November 2015 states: The scope of this service is detailed under the heading "Purpose and Scope of the Engagement" in paragraph B in the attached "Terms of Engagement". Given the magnitude of the issues involved and the time that has elapsed since your separation, we expect that this would be a very costly exercise if we were to bill you at our normal hourly rates. It is also likely that this exercise could drag on for several months if your ex-husband is non-cooperative and this in-turn would compound the cost for you. We therefore propose to offer you a reduced fee being one upfront payment to cover our employee costs to commence the assignment and then a percentage fee based on the outcome.
The fee was specified to be "a one off upfront fee of $10,000.00 and no further amount will be charged (except disbursements and out of pocket expenses)", with the applicant agreeing "to pay us 10% ex GST of the amount that you receive from your ex-husband".
Part B of the Terms of Engagement states the Purpose and Scope of the Engagement in the following terms: You have instructed us to review your and your ex-husband's financial structure and related assets and liabilities with a view of making a claim through the Family Court. We do not provide legal services, rather this will be provided by your solicitor. We will provide a report to yourself which may be sent to your ex-husband with the view to settling his financial obligations to you. Our review will include an analysis of documentation made available to us in relation to certain entities which you have indicated have some connection with yourself or your ex-husband. This may include a share in certain businesses including one or possibly two accounting practices. You have also asked us to review compliance from a taxation perspective in relation to these entities.
The possibility that the contract between the parties was partly written and partly oral was raised by the respondent's lawyer in the request for particulars of 11 April 2017. The follow up correspondence indicates that there was no response to that request. Neither party has adduced evidence to establish that the contract was partly written and partly oral, or if it was, what the oral terms may have been. The Tribunal is not prepared to conclude that the written document dated 25 November 2015 does not accurately record the entire agreement between the parties.
The applicant's claim is that the contract required the respondent to provide "a Financial Expert Report containing an expert opinion regarding the financial matters" of herself and her ex-husband, intended for the Family Court; that that was not provided; and that the Expert Financial Report was to be more than one letter.
The respondent denies that he was engaged to provide an expert report, and his affidavit evidence is that he did not act to provide advice and assistance to the applicant on that basis. In an email of 6 October 2016 to the applicant's then family lawyer, he states that "it was agreed that [the report] would be sent to her ex-husband in a letter format".
The signed agreement requires the respondent to "review", and provide "a report". The document makes clear that the context is a possible "claim through the Family Court", and it envisages that the report "may be sent to [the applicant's] ex-husband with a view to settling his financial obligations…".
The scope and form of the "report" was not defined in the Terms of Agreement. The context as expressed in the covering letter and Part B of the agreement was that it was intended to be the basis for settlement negotiations. The document does not in terms require a report in a form that would satisfy the requirements for expert opinion evidence in any court proceedings. In any event, as confirmed by the letter dated 24 November 2015 from the applicant's ex-husband's family lawyer to her family lawyer, included in the documents sent to the respondent before their meeting, there were no court proceedings on foot at the time. The Tribunal does not find that a term of the contract required the respondent to provide a report in the form of expert evidence.
The evidence does not establish that the contract was partly written and oral, or whether any variations were agreed between the parties after 11 December 2015. While the agreement dated 25 November 2015 does not require a report in the form of expert evidence admissible in court proceedings, equally it does not support the respondent's claim that the report was required to be in the form of a letter. The Tribunal finds that the "report" required by Contract 1 was to be a document that could be sent to the applicant's ex-husband as part of the family law settlement negotiations.
The applicant contends that all that the respondent provided was an email to her and a letter to her ex-husband in February 2016. Both documents are in evidence. The email of 31 December 2015 (Annexure 15) proposes an approach to the applicant's ex-husband based on his asserted failures to comply with regulatory requirements and incurring of various liabilities, and suggests four demands expressed in general terms. The email concludes with the suggestion that he introduce the applicant to a "commercial solicitor", the advice that the applicant "finalise your matrimonial consent orders urgently", and a request to meet on 8 January 2016 "to discuss our next steps".
The respondent submits that the email sent to the applicant on 31 December 2015 was part of the reporting back to her, which included the series of text messages in communications in early December 2015. The respondent states that on 12 February 2016 he sent a letter to the applicant's ex-husband "in an attempt to settle the matter and protect the Applicant's interests"; that he "negotiated a settlement… on behalf of the applicant over a period of time by forwarding the letter to him a number of times and having at least two telephone conversations with him". His letter dated 1 February 2016 to the applicant's ex-husband (Annexure 19) lists eight matters including the applicant's entitlement to superannuation funds, a payment of $600,000 due from Kelly Partners, car yards on Parramatta Road, and funds spent by companies under the applicant's control; and requests further information and documentation from the applicant's ex-husband.
There is a reference to a draft letter dated 17 January 2016 in the letter dated 7 October 2016 from the applicant's lawyer to the respondent (Annexure 44), which supports the respondent's statement in his email of 6 October 2016 that "the report was sent to Janette in draft form for approval prior to being issued to Anthony…". While there is no copy of the draft letter in evidence the Tribunal finds based on the acknowledgement of the applicant's lawyer that one was prepared and available for consideration by the applicant before the letter of 1 February 2016 was sent.
Based on the documents in evidence the Tribunal finds that the "report" provided by the respondent was the 31 December 2015 email and the 1 February 2016 letter. The applicant disputes the adequacy of those documents. However there is no evidence as to whether or not the amount charged in Invoice 00000016 was a fair reflection of the value of the work undertaken, and no evidence as to whether the review on which the email and letter were based was undertaken without the required degree of care and skill. Some work was done, as evident in the detail provided in the letter, and there has not been a total failure of consideration so as to warrant an order for the return of the $11,000.00 paid by the applicant. The applicant has not established what her actual loss, if any, is in relation to the work done under Contract 1 so as to justify an award of damages. The applicant has not established her claim under Contract 1.
The respondent's submission that the respondent was not the contracting party was made in relation to Contract 1, and it appears to have been conceded that he was a party to Contracts 2, 3 and 4. However, if that is not correct, for the reasons given below, the applicant's claims against the respondent in respect of Contracts 2, 3, 4 and 5 have not been established.

Contract 2

In considering the applicant's claim under Contract 2, it was common ground that there was a meeting between the parties on 8 January 2016, as foreshadowed in the email of 31 December 2015. The respondent states that at that meeting he informed the applicant of the responsibility to appoint a liquidator if a company is insolvent; and the applicant instructed him to attend to the formalities of arranging a liquidator for Abfackeln. The applicant's evidence is consistent with that evidence, and her position differs only as to the tone of the meeting and some detail as to what was said. In oral evidence the applicant said that she was warned that ASIC could fine her if the company traded while insolvent and she should close the company down so she was no longer liable for the loan to the client of her ex-husband. She was convinced that liquidation of Abfackeln was "urgent and Imperative". It was common ground that Abfackeln owed John Reay $560,000.00.
There is no written agreement reflecting the terms of Contract 2. The applicant's understanding of the agreement is stated above at paragraph [17]. That understanding of the terms of the contract is consistent with the respondent's affidavit evidence which was that the terms of that contract were simply for him to refer the applicant and her company, Abfackeln, to a liquidator for him to perform a winding up.
Invoice 00000026 dated 12 January 2016 addressed to Abfackeln for "Liquidation fees as agreed", issued by "Liquidion Consulting" (ABN 15 605 650 182) was for $22,727.27 less $10,000.00 paid on 12 January 2016, leaving a balance owing of $15,000.00 (including GST). It was common ground that the applicant paid $10,000.00 (Annexure 25). The documents reveal some discussion, and negotiation with John Reay, for payment of the balance.
In relation to payment, the respondent states: As the work requires the preparation of documents such as Report as to Affairs and financial statements sometimes, I invoiced the client and engaged the liquidator from the funds paid by the client. I then arranged to pay the liquidator from the fund paid by the client. Sometimes that liquidator will seek funds in excess of the funds that I hold after I perform work, and sometimes the liquidator will seek less funds and it tends to depend upon how much work I do perform in relation to the company and how much I can relieve the liquidator of doing the work themselves.
It is not necessary to decide whether it was a term of the contract that the $10,000 paid by the applicant was to be held by the respondent and disbursed as required, or transferred to Hall Chadwick. Based on the email dated 13 March 2017 from Hall Chadwick the only available inference is that that money was retained by the respondent. There is no evidence that the balance of $15,000.00 was ever paid either by the applicant or by anyone else.
The Tribunal finds that Contract 2 required the respondent to have Abfackeln placed in liquidation, engaging Hall Chadwick as liquidator. It was common ground that Abfackeln was not placed into liquidation.
On the available evidence, the Tribunal finds that at best the work done by the respondent under Contract 2 was a preliminary discussion with Hall Chadwick (Annexure 26), and discussions about possible funding for the liquidation through John Reay (Annexure 28). There does not appear to be any basis for the respondent's statement in the email of 16 February 2016 (Annexure 29) that "the liquidation commenced Monday". While the respondent's oral evidence was that he had liquidation documents prepared by Hall Chadwick, that is not consistent with the advice received by the applicant from Hall Chadwick in the email of 13 March 2017 (Annexure 26) and there are no such documents in evidence; the Tribunal does not accept that he did so.
However, the difficulty for the applicant in establishing a basis for a refund of the money paid to the respondent for services for the liquidation of Abfackeln, in circumstances where that did not proceed and where minimal work appears to have been done by the respondent, is that by May 2016 a decision had been made not to place Abfackeln in liquidation, but to transfer ownership and responsibility for that company, under Contract 4. While there is no contemporaneous documentation to record that decision, there was no dispute that that was the strategy then adopted, and to that extent there was a variation of the original contract.
The Tribunal finds that there was some work done by the respondent in accordance with the tasks undertaken under Contract 2. Even if that work was not in accordance with the contracted obligations, given the subsequent decision to proceed with the sale of Abfackeln as opposed to liquidation, the applicant has not established what her actual loss, if any, is in relation to the work done under Contract 2 so as to justify an award of damages. The applicant has not established her claim under Contract 2.

Contract 3

It was common ground that the decision to set up a new company was taken at the meeting on 8 January 2016.
There is no written agreement reflecting the terms of this agreement. It was common ground on the affidavit evidence that the agreement between the parties was for the respondent to set up the company, register an ABN, and attend to ASIC matters. The applicant states further that the respondent was to advise her as to her obligations as Company Director, Secretary and shareholder. Invoice 00000032 dated 22 February 2016 (Annexure 22), for payment to "Liquidion Consulting" of $1,980, states "Set up of Phoenix Four (NSW) Pty Ltd including attendance to ASIC matters and ABN registration", confirming the agreed understanding of the terms of this engagement.
Phoenix Four (NSW) Pty Ltd was registered on 19 January 2016 (Annexure 31). While the initiating documents incorrectly show the name "Pickering" (Annexure 35), that has subsequently been corrected, as evident in the correspondence from ASIC to the applicant (Annexure 36). It was common ground that no ABN was obtained.
The mechanism for payment by the applicant for this transaction is set out at paragraph [37] of her affidavit, and included set offs and refunds relating to the other transactions the subject of these proceedings. Based on that evidence, which was not contested by the respondent, the Tribunal finds that the applicant paid $1,400.00 under Contract 3.
The applicant's contention is that she is entitled to the refund of $1,400.00 because she was poorly advised, there was no need to set up the company in the first place, there was no ABN, the respondent has overcharged her, and a late fee was payable. The applicant acknowledged in oral evidence that the company has not commenced trading.
Other than the absence of an ABN, the Tribunal is satisfied that the respondent performed the services required for the establishment of the company, and accordingly there is no basis for a claim for return of all the money paid. In the context of the dispute as to whether the contract included advice as to her obligations, the emails of November 2015 establish that the applicant was already familiar with the complexities of the various interests she had either as sole shareholder and officeholder or in the form of shared interests with her former husband. The extent of any need for, or obligation on, the respondent to advise her on her obligations as company officeholder and shareholder, as asserted in her affidavit, is unclear. The applicant has not established what loss she suffered as a consequence if the giving of that advice was a term of the contract. There is no evidence as to the actual loss suffered by the applicant because no ABN was obtained, or the basis on which the applicant is claiming for late fees payable over a year after the company was registered. The applicant has not established her claim under Contract 3.

Contract 4

It was common ground that at a meeting on 17 May 2016 the applicant decided to transfer ownership of Abfackeln. There was no documentation relating to this agreement, as confirmed in Mr Bell's affidavit of 13 June 2017. Notwithstanding the absence of documentation, there was substantial agreement in the affidavit evidence as to the substance of the arrangement between the parties. As expressed by the applicant in her affidavit, the respondent was to: 1. Inquire about and provide advice on the intended sale of ownership rights to Abfackeln; 2. Arrange for a purchaser who would accept liabilities for Abfackeln; and 3. Execute the sale.
That is consistent with the evidence of the respondent, who states in paragraph [75] of his affidavit that he was to provide advice, make inquiries, make arrangements to ensure that the purchaser "accepts all liabilities that arise out of the company", and execute the sale.
It was common ground that the applicant paid $5,500.00 by credit card; that there was a dispute as to the inclusion of $500.00 as GST; that the $5,500.00 was refunded; and that the applicant paid the respondent $5,000.00 in cash.
There are two issues with the documentary evidence relating to Contract 3. First, the respondent's documents include at tab 2 Invoice 00001465 dated 28 April 2016 from "Wayne Fraser" for $15,000.00, being "Our fees in relation to sale and director changes to Abfackeln Investments Pty Ltd". That invoice may relate to a statement by the respondent at paragraph [65] of his affidavit that he and the applicant agreed that the funds for the liquidation of Abfackeln would be reduced to $15,000.00 and that those funds would apply to the sale of Abfackeln to a purchaser. However the date on that invoice is not consistent with the evidence of both the applicant and the respondent that the contract for sale of Abfackeln was entered into on 17 May 2016.
Secondly, the ASIC extract provided by the respondent at the hearing showing that the applicant had ceased to be a shareholder or officeholder of Abfackeln on 1 February 2015 is not consistent with the parties' mutual understanding as at May 2016 that the applicant was still responsible for Abfackeln. It is not consistent with the ASIC extract provided by the applicant which shows that as at 18 August 2016 she was still listed as director and secretary of Abfackeln (Annexure 38). The letter dated 4 October 2016 from the applicant's then lawyer to the respondent (Annexure 43) states that on 29 September 2016 a copy of that ASIC extract was sent to the respondent with a request for a refund of the $5,000.00 cash. That letter goes on to note that an ASIC Organisation Extract dated 4 October 2016 records that on 30 September 2016 ASIC received notification to remove the applicant as director, secretary and shareholder, and that another person was appointed as director, secretary and shareholder of the company commencing on 1 February 2015. That document is not in evidence.
Based on the contemporaneous documents, the Tribunal finds that as at 18 August 2016 the applicant was still an officeholder and shareholder of Abfackeln, and that on 30 September 2016 she ceased to be an officeholder or shareholder of Abfackeln. Whether or not she thereby ceased to have any responsibility for any remaining liabilities of Abfackeln is not clear. The letter of 4 October 2016 refers to the applicant having given personal guarantees for the debt owed to John Reay by the company, however no further evidence has been provided as to her continuing liability. While the applicant contends that the respondent failed to perform his contracted obligations in relation to the sale of Abfackeln, the correspondence from the applicant's then lawyer in September 2016 requests that control of Abfackeln be returned to her. The applicant has not identified any actual loss, and in any event there is no amount claimed as refund. Any monies paid in relation to this transaction appear to have been set off for other transactions. The applicant has not established a claim under Contract 4.

Contract 5

It was common ground that the applicant and respondent met at the offices of Freedom Taxation NSW in Penrith in relation to the preparation of the applicant's individual tax return for 2015. The applicant states that this meeting took place on 7 July 2016. The applicant contends that she paid $1,650.00 in cash, and did not receive a receipt. The applicant contends that the return prepared (Annexure 42), contained incorrect financial data and she has been unable to sign off on it. The respondent's position is that the work was carried out by Freedom Taxation.
Invoice 2016-003211 dated 9 June 2016 (Annexure 24) for "Preparation and Lodgement of Individual Tax Return 2015 included meetings and advice" is in the name of "Freedom Taxation NSW", in the amount of $1,650.00 (incl GST). The applicant's claim that she paid $1,650.00 in cash to the respondent is supported by the affidavit of Paul Bell affirmed on 13 June 2017. There is no other evidence as to payment of the Freedom Taxation Invoice, and the Tribunal accepts that evidence and finds that the applicant paid $1,650.00 to the respondent.
The copy of the return provided (Annexure 42, 43) states that the return was prepared by Freedom Taxation, with Wood Smith Partners Pty Ltd as tax agent, and not by the respondent. The Tribunal finds, based on the invoice, the applicant's evidence as to the meeting, and the copy of the return in evidence, that the agreement for preparation of the 2015 tax return was between the applicant and Freedom Taxation, and not the respondent.
The Tribunal finds that the tax return was prepared. The applicant has not established that the respondent, as opposed to Freedom Taxation NSW, is liable for any errors. The applicant has not established her claim against the respondent under Contract 5.

Return of Documents

The applicant states that she requested return of her documents by email dated 23 August 2016. That email (Annexure 3) confirms an arrangement for Mr Bell to pick them up from the respondent in Penrith. It is not clear whether that request relates to all of the documents provided by the applicant to the respondent at the meeting of 30 November 2015 or otherwise. The letter dated 29 September 2016 by the applicant's lawyer requests return of her "company registers" and "all financial documents provided to you and not yet returned" (Annexure 4). The lawyer wrote again on 4 October 2016 to demand that by 6 October 2016 the respondent deliver "the entirety of [the applicant's] documents'" to them. That request was repeated on 7 October 2016 and 10 October 2016. There followed what appears to have been an attempt by the respondent to propose settlement of various matters in dispute, and emails between the parties about arrangements for Mr Bell to collect documents.
The evidence as to the current position with regard to documents is in a letter dated 11 April 2017 from the respondent's lawyer to the lawyer then acting for the applicant recording that they hold corporate registers and trust deeds, which they assert are documents to which the applicant would not be entitled; returning documents relating to a superannuation fund; and a statement that they are instructed that the respondent "holds no other documents". The request for particulars dated 11 April 2017 includes a request for the applicant to "identify the personal and business records that [she] asserts were delivered to the Respondent and not returned".
The applicant has not provided detail either in the form of a response to the request for particulars, or in her affidavit or other evidence, as to which documents may still be in the possession of the respondent. Based on the most recent correspondence, and in the absence of any evidence to the contrary, the Tribunal finds that any documents retained from those provided by the applicant to the respondent are no longer in the possession of the respondent. Whether or not it is appropriate for the respondent's lawyer to hold any of these documents is not a matter for the Tribunal. There is no basis on which an order could be made in the terms sought by the applicant under s 79(e) of the FT Act for the respondent to deliver goods to her.

Claim under the ACL(NSW)

The Tribunal is satisfied that the applicant is entitled to assert her claim in the alternative under the Australian Consumer Law (being Sch 2 to the Competition and Consumer Act 2010 (Cth)), which applies as the Australian Consumer Law (NSW) (ACL(NSW)) by operation of s 28 of the FT Act. The services provided by the respondent fall within the definition of "services" in s 2 (paragraph (b)(i)) of the ACL(NSW). The engagement of the respondent was made in the context of the applicant's family law dispute with her ex husband, and the Tribunal is satisfied that she acquired the services as a consumer as defined in s 3 of the ACL(NSW). While the respondent disputes that he personally was a party to any of the contracts, he did not dispute that he personally performed the work undertaken for the applicant, other than in relation to the preparation of her individual 2015 tax return.
The applicant contends in her affidavit at paragraph [24] that she acted in reliance on false, misleading and deceptive advice given by the respondent, and in paragraph [57] that the respondent engaged in deceptive and misleading conduct.
These contentions appear to assert a failure to comply with ss 18 and 21 of the ACL(NSW), which provide: 18 Misleading or deceptive conduct A person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive. 21 Unconscionable conduct in connection with goods or services (1) A person must not, in trade or commerce, in connection with: (a) the supply or possible supply of goods or services to a person (other than a listed public company); or (b) the acquisition or possible acquisition of goods or services from a person (other than a listed public company); engage in conduct that is, in all the circumstances, unconscionable.
To the extent that the applicant's claims raise claims of unconscionable conduct on the part of the respondent, s 22 of the ACL (NSW) provides a list of matters to which regard may be had in determining whether a supplier has contravened s21 in connection with the supply of services.
The applicant has not identified any specific misleading or deceptive conduct, other than her grievances with the work done under the five contracts, which has been discussed above. In relation to her grievance as to the respondent's use of different business names and other details, the Tribunal accepts that that has complicated the understanding of the contractual relationships at issue; however, the applicant has not identified any particular reliance, or loss, on that basis.
The applicant states that she was naïve in financial, taxation and company matters as her ex-husband managed their affairs and had appointed her as company director, and she has suffered long term financial and emotional abuse. The applicant relies on a letter of support dated 15 March 2017 from her GP who states that she "has marked features of severe PTSD and is under significant situational and financial distress".
The Tribunal accepts that the applicant has been under significant situational and financial distress. The pressure of the ongoing family law negotiations was acknowledged by the parties in their email correspondence in evidence. The Tribunal accepts the applicant's evidence that her former husband managed their financial affairs. However, based on the emails sent to the respondent in November 2015 the Tribunal is not persuaded that the applicant was entirely reliant on others in relation to those affairs. The emails, in particular the email of 14 November 2015, indicate a relatively astute awareness of what was a complex network of trusts and companies, and in particular her potential liabilities, including for the loan to Abfackeln. The applicant was able to collect relevant documents and provide them to the respondent in November 2015, and to request advice on specific issues, for example whether it was better to liquidate or sell Abfackeln. The Tribunal does not find that the circumstances could be characterised as involving exploitation of any special disadvantage.
The applicant has not demonstrated that any undue influence or pressure was exerted by the respondent to have her enter into the series of transactions, rather, the email correspondence demonstrates that the applicant was happy with the services provided by the respondent from December 2015 until late in September 2016. While it can be accepted that the respondent's understanding of the legal and financial concepts was greater than that of the applicant, he advised the applicant to obtain independent legal advice on a number of the issues that arose in the course of his engagement, in particular in the emails of 17 and 31 December 2015. The applicant acknowledged in oral evidence that she had received that advice, and the documents in evidence confirm that she retained legal assistance both in her family law and other matters.
The applicant has not established a failure to comply with any of the relevant obligations under the ACL(NSW). Accordingly, it is not necessary to consider whether there would be any basis for consideration of whether she could claim a refund of any of the money paid to the respondent as a consequence.

Costs

Section 60(1) of the Civil and Administrative Tribunal Act 2013 (the NCAT Act) provides that each party to proceedings in the Tribunal pays their own costs. Given the amount claimed by the applicant as confirmed at the hearing, for costs to be awarded the Tribunal would have to be satisfied that there are special circumstances warranting an award of costs: s 60(2). Section 60(3) lists the matters to which regard can be had in determining whether there are special circumstances.
The applicant claims that she has been taken advantage of by the respondent because of her vulnerable position, that she believes that the respondent's lawyer has a conflict of interest, and that the respondent's documents were provided late. The applicant has not succeeded in establishing her claims, including her claim under the ACL(NSW). The Tribunal accepts that the presentation of the applicant's case was made more difficult by the late service of the respondent's documents, a factor relevant under s 60(3)(a). While the applicant objected to the involvement of the particular lawyer retained by the applicant, the respondent was entitled to engage a lawyer, as was she, and any asserted conflict would not be a matter for the Tribunal.
The respondent claims that the applicant's case has changed over time, requiring orders that particulars be provided. He accepts that his evidence was delayed. He submits that the claim should not have been brought, as the evidence did not establish a breach of the ACL(NSW) and there was no basis for the claim in contract; and there was no expert evidence to challenge the decision about the liquidation of Abfackeln. The Tribunal accepts that the applicant has not succeeded in establishing any of her claims, however does not accept that the claims had no tenable basis in fact or law, as identified in s 60(3)(c). While the respondent points to the absence of particulars, he was on notice of the detail of the applicant's claims when he received her affidavit of 10 July 2017 with supporting documents.
Having regard to all the circumstances the Tribunal is not persuaded that there are special circumstances warranting an order for costs.

Conclusion

The Tribunal is not satisfied that the applicant has discharged her onus of establishing that the respondent was in breach of his contractual obligations in relation to Contracts 1, 2, 3, 4 or 5 so as to entitle her to an order for refund of the money paid. The applicant has not established that the respondent has breached any applicable provision of the ACL(NSW). The applicant has not established that the respondent holds any documents which could be the subject of an order under s 79(e) of the FT Act. Accordingly, the application is dismissed.
The orders of the Tribunal are: 1. The application is dismissed. 2. No order as to costs.

Civil and Administrative Tribunal of New South Wales

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: 23 January 2018

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Judgment (25 paragraphs)

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Cases Cited (5)