APV v Department of Finance and Services

NCAT Administrative and Equal Opportunity|2016-04-18

Solicitors: Gilbert + Tobin Lawyers (Applicants) Australian Government Solicitor (Respondent) File Number(s): 1330077

Background to this application

In APV and APW and Department of Finance and Services [2014] NSWCATAD 10 (the previous decision) I found that the Respondent had breached sections 17 and 18 of the Privacy and Personal Information Protection Act (the PPIP Act) in respect of the Applicants. The Respondent appealed to the Appeal Panel of the Tribunal. Insofar as is relevant to the present matter, the Appeal Panel, in Office of Finance and Services v APV and APW [2014] NSWCATAP 88 affirmed my decisions that the Respondent's conduct in relation to the sale documents for the Applicants' property in the Rocks (the property) which contained aspects of the Applicants' personal information was a breach of its obligations under ss 17 and 18 of the PPIP Act, and that the Respondent's use of the Applicants' personal information, for the purposes of the 'change of use' application to the City of Sydney (the Council) for the property was also a breach of its obligations under ss 17 and 18 of that Act.
The Applicants now seek:

damages in the amount of $40,000, pursuant to s 55(2) of the PPIP Act; and
costs of these proceedings, including the appeal, pursuant to s 60 of the Civil and Administrative Tribunal Act 2013 (the CAT Act).

Factual background

The Appeal Panel succinctly set out the factual background: 6. APV and APW have a 99-year lease over a property owned by the NSW Land and Housing Corporation. That agency is now part of the Appellant, the Office of Finance and Services. The lease was conditional on APV and APW completing certain renovation and conservation works. APV and APW undertook those and other works over a period of approximately two years at a cost of more than $1,000,000. 7. For the purpose of obtaining approval from the Office of Finance and Services for those works, APV and APW provided certain information to Mr Mitchell, an architect and employee of the Office of Finance and Services. 8. In December 2011 the Office of Finance and Services engaged a real estate agent to undertake the marketing and sale of a number of properties, including the property next door to APV's and APW's property. Marketing of the property next door commenced in April 2012. From April to June 2012 Mr Mitchell provided information including APV's and APW's names, address, photographs and other information relating to their home and the restoration works, to an external architect. The information was provided so that the external architect could prepare a Conservation Management Plan and a Schedule of Repair Works for the house next door. 9. The Conservation Management Plan contained APV's and APW's address, but not their name, and included photographs of the interior and exterior of their property. It also identified works being undertaken at that property. The Schedule of Repair Works contained APV's and APW's address but not their name and included floor plans and internal design features of their property. 10. From about April 2012 the marketing material for the house next door was disclosed to prospective purchasers of that property who were members of the public. Those materials included the Conservation Management Plan and the Schedule of Repair Works. 11. On 2 November 2012, the Office of Finance and Services lodged a development application with the City of Sydney for the change in use of the property next door from a boarding house to a single dwelling. In support of that development application, the Office of Finance and Services also lodged a number of documents including the Conservation Management Plans for APV's and APW's property and the property next door. 12. APV and APW complained that between 31 March and 9 November 2012 the Office of Finance and Services breached the PPIP Act by "using" and "disclosing" information relating to their property. APV and APW sought a review of the Office of Finance and Services' conduct under s 55 of the PPIP Act. The specific conduct which the Tribunal identified as being the subject of the application for review was: (1) disclosing their personal information to an external architect; (2) using their personal information to prepare documents as part of the marketing and sale of a neighbouring property; (3) disclosing the information in the marketing and sale documents relating to a neighbouring property; and (4) using and disclosing the information in preparing a "change of use" application to the Council for a neighbouring property.
Section 55 of the PPIP Act sets out what remedies are available to the Tribunal when there has been a breach of that Act, relevantly: … (2) On reviewing the conduct of the public sector agency concerned, the Tribunal may decide not to take any action on the matter, or it may make any one or more of the following orders: (a) subject to subsections (4) and (4A), an order requiring the public sector agency to pay to the Applicant damages not exceeding $40,000 by way of compensation for any loss or damage suffered because of the conduct, (b) an order requiring the public sector agency to refrain from any conduct or action in contravention of an information protection principle or a privacy code of practice, (c) an order requiring the performance of an information protection principle or a privacy code of practice, (d) an order requiring personal information that has been disclosed to be corrected by the public sector agency, (e) an order requiring the public sector agency to take specified steps to remedy any loss or damage suffered by the Applicant, (f) an order requiring the public sector agency not to disclose personal information contained in a public register, (g) such ancillary orders as the Tribunal thinks appropriate. (3) … (b) the Tribunal is satisfied that the Applicant has suffered financial loss, …, because of the conduct of the public sector agency.

CONSIDERATION

The Tribunal (and its predecessor) has considered the question of compensation under the PPIP Act on a number of occasions: for example, WT v Auburn Council [2007] NSWADT 253, NW v NSW Fire Brigade (No.2) [2006] NSWADT 61, NZ v Director General Department of Housing [2006] NSWADT 173; GR v Department of Housing (No.2) [2005] NSWADT 301 and RD v Department of Education and Training [2005] NSWADT 195. Cited with approval in some of these decisions is the decision of the Commonwealth Administrative Appeals Tribunal in Re Rummery & The Federal Privacy Commissioner & Anor [2004] AATA 1221.
In WT v Auburn Council the Tribunal extracted principles from the previous decisions, relevantly as follows: (a) that damages are compensatory in that the Applicant should be awarded such sums of money so as that he/she may be restored to the position that he/she would have been in but for the breach: see GR (supra) at [26] and Rummery (supra) at [32]. However, this must also be viewed in the context of the $40,000 limit as provided for in the PPIP Act; (b) in measuring compensation the principles of damages as apply in tort law are a guidance but the ultimate guide is the wording of the PPIP Act and its objectives: see NW (supra) at [22]; (c) compensation should be assessed having regard to the complainant's reaction and not to the perceived reaction of the majority of the community or of a reasonable person in similar circumstances: see Rummery (supra) at [46] as adopted in NZ (supra) at [35]; … (e) even where an Applicant is able to substantiate loss or damage as a result of conduct that contravenes an 'information principle' under the PPIP Act, an award of damages under that Act remains a discretionary one: see NW (supra) at [23] and [24] and cf. Re Rummery (supra) at [32].

Issue estoppel

The Applicant contended that, in the course of the Respondent's submissions it had attempted to re-agitate that the information used by the Respondent was not in fact personal, despite that having already been decided in the previous decision and confirmed on appeal. By way of example, the Applicant noted that the Respondent claimed that: the information about the works was expressed at "a very high level of generality"; the works being undertaken at the property were only described in "very general terms"; and the "description of works identified internal features of the Applicants' property only at a general level" and the Respondent's approach that I should more closely examine the information which was the subject of the breach. Detailed submissions were made by both parties about this contention.
The Appeal Panel at [16], relevantly, summarised my findings as to the relevant "personal information" contained in the Conservation Management Plan (CMP) for the property next door as follows: (a) included photographs of the interior and exterior of APV's and APW's property; (b) identified works being undertaken at APV's and APW's property, including those relating to the interior of the property; and (c) identified APV's and APW's initial architect for the works at their property
Similarly, the information contained in the Schedule of Repair Works (the Schedule) for the property next door included: (a) floor plans of APV's and APW's property; and (b) identified required works for the house next door by reference to the features of APV's and APW's property, including internal design features that would not otherwise have been readily available to the public.
Further, the Appeal Panel clearly set out at [63] what features of the Applicants' information was properly considered as personal: 63. … But the other information in the Conservation Management Plan and the Schedule of Repair Works, including photographs of the interior of their home, the floor plan and interior design features, was not available on the website and is therefore not excluded from the definition of "personal information" by s 4(3)(b). That conclusion does not have the effect of defeating the purpose of the exception in s 4(3)(b).
Compensation for alleged financial or any other loss can only be considered where the Tribunal finds that the alleged loss and harm was 'because of' or 'caused by' the contravening conduct of the Respondent: BVS v Sydney Local Health District [2015] NSWCATAD 171 (BVS).
I consider that the Applicants' concerns are misplaced, and that the issues raised by the Respondent are better characterised as submissions going to the extent of the breach, with a view to challenging the nexus between the breach and the damages, and I have dealt with them on this basis.

Nexus between the breach and the claimed damages

The Applicants' case is best described as a claim for the loss of opportunity. The Applicants claim they have suffered damage by reason of the disclosure in that their ability to market services based on their personal information has been reduced or limited. It is the Applicants who bear the onus of establishing the causal link between the breach of privacy and the damage allegedly suffered: see, for example, GR v Director-General, Department of Housing [2004] NSWADTAP 26 at [42].
APV's evidence was that from March 2012 the Applicants set about showcasing their renovations by offering paid tours, publishing photographs in newspapers and magazines and permitting the property to be shown in a television programme and a film. However, following the disclosure of the Applicants' personal information in the CMP and the Schedule, the Applicants considered that they would no longer be able to offer their information/consultancy services for a fee, as had been their intention.
To demonstrate the market for such services, APV also gave evidence as to conversations with other potential purchasers of the property next door, which were said to have included expressions such as: 'no need [for us] to reinvent the wheel' and 'that makes it easy for us to bid', and 'you've set the standard and made lots of dollars for us all'. APV also said that 5-6 other potential purchasers had come to his door wanting access to his house and restoration cost estimates.
The Respondent submitted that the statements do not demonstrate the requisite causal link between the breach and the claimed damages. I agree that, of themselves, they do not support a claim of a thwarted consultancy plan.
The Applicants also relied on Ms Hamilton's evidence. She noted that the Schedule includes 17 references to matching the works at the property and some of those references disclose details of works undertaken at the property. These provide additional detail which would assist a prospective purchaser to more accurately cost the required repairs and remove some of the 'trial and error' the Applicants had undertaken. She also noted that details of the Applicants' property contained within the Schedule provide physical examples of the level of restoration expected on the property next door. Ms Hamilton referred also to the reference to an internal room and an additional bathroom which would not be evident from an external inspection.
Ms Hamilton estimated that the benefit to prospective purchasers of the personal information the subject of the breach would include: 1. minimising the risk associated with Heritage Council approval; 2. saving time seeking and contracting a suitable professional specialised in the restoration of historical properties and experienced in dealing with NSW Heritage Council; 3. saving time sourcing suitable fittings, fixtures and hardware acceptable for a heritage restoration; 4. fast tracking the overall restoration process, thereby reducing overall construction and holding costs.
She also estimated that the expected benefit to a purchaser would be a time saving benefit: a minimum of one working week (40 hours) per property researching and sourcing appropriate people and resources, which she calculated at $20,000 per property (excluding GST) as well as savings in the engagement of heritage consultants (although Mr Mitchell disputed the hourly rate for heritage consultants). She made some concessions in cross-examination about her assumptions which tended to suggest she may not have been adequately briefed about the precise circumstances. It does not necessarily follow that engaging the Applicants as consultants would address likely expenses to a potential applicant. Taken at their most generous though, while there may be possible savings to a potential purchaser, they do not represent a loss to the Applicants.
In the context of the Applicants' potential to earn consultancy fees, Ms Hamilton considered that about 25% of purchasers, would without question, pay for and apply the Applicants' information to accelerate their construction process and timeframe, potentially limiting their risk.
The Respondent submitted that, in any event, there was no evidence that the Applicants were precluded from selling that type of information, had they so wished. However, I accept that the Applicants' personal information in the CMP and the Schedule could be useful to potential purchasers, and as a consequence the Applicants' potential to exploit their intellectual property was diminished. In this regard I accept the evidence of Ms Hamilton that there may be some purchasers who would have paid for the relevant information sourced directly from the Applicants. I do not however find there to be any factual basis for her belief that this may be as high as 25% of purchasers.
APV estimated that, based on the knowledge the Applicants had acquired during the restoration of the property, they, as purchasers, could have saved approximately $663,000. I do not consider this purported evaluation of their experience to be relevant to the matter at hand, as it was entirely unclear how that calculation was relevant to the breach. In any event, this did not appear to be pressed by the Applicants.

Quantification of damages

The Applicants submitted that the damage they suffered exceeds the $40,000 statutory maximum; they claimed to have suffered damage in the order of $100,000. The Respondent claims that the statutory maximum is reserved for the most serious breaches of the PPIP Act. In NK v Northern Sydney Central Coast Area Health Service (No.2) [2011] NSWADT 81 the Tribunal made an order for financial compensation of $40,000. The circumstances in that case were unique in that, amongst other things, there were a large number of breaches, and the Applicants' health had been very seriously affected by the breaches. In any event, it was not a case involving claimed financial loss.
The Applicants relied on the evidence of Ms Hamilton to the effect that the Applicants would have been able to receive an estimated $100,000 in fees based on the details and information derived from the works undertaken at the property. Subsequently, applying Ms Hamilton's figures, the Applicants submission was that the lost fees would be in the range $12,000 to $14,400 per property (for a total of $60,000 to $72,000 excluding GST). As this clearly exceeds the $40,000 maximum compensation available under the PPIP Act, it made no material difference to the Applicants' claim, as previously articulated.
The Applicants conceded that such evidence necessarily involves a degree of estimation but submitted that the Tribunal must 'do the best it can' in estimating the quantum of damages. The Applicants referred to Tabet v Gett [2010] HCA 12 at [136] - [137] where their Honours said. 136 … the courts must do the best they can in estimating damages; mere difficulty in that regard is not permitted to render an award uncertain or impossible. 137 Thus in the case of the loss of a commercial opportunity, the plaintiff must first establish the fact of the loss, for example by reference to the fact that it had a commercial interest of value which is no longer available to be pursued because of the defendant's [actions]. …
The Respondent referred to the need for a restrained approach in awarding damages in relation to legislation of the kind that privacy laws represent, such as I observed in APV and APW v Department of Family and Community Services [2015] NSWCATAD 140 at [86]. I observe also that the Tribunal has found in some cases (eg FM v Macquarie University [2003] NSWADT 78 at [100] and NW v New South Wales Fire Brigades (No 2) at [26]- [32]), notwithstanding a causal connection, in its discretion, the Tribunal declined to make an award of damages at all.
I accept that the Applicants found themselves in a bittersweet position. On the one hand, they are likely to have had the satisfaction of their improvements to their property being very highly regarded, and it could be said, set the standard for redevelopment in the area. On the other hand, their efforts, at considerable expense, were used by the Respondent in a fashion that may have benefitted other purchasers. However, I consider the amount claimed by the Applicants to be excessive; the evidence does not justify an order for compensation as they have claimed. Doing the best I can, an appropriate award for the financial loss caused to the Applicants by the conduct of the Respondent is $5,000.

COSTS

Section 60(1) of the CAT Act sets out the default provision with respect to costs, namely that parties to proceedings before the Tribunal are to pay their own costs. Under s.60(2) the Tribunal may only make an award for costs where "satisfied that there are special circumstances warranting" such an award.
Section 60(3) sets out the types of matters to which the Tribunal may have regard when considering whether there are special circumstances: (a) whether a party has conducted the proceedings in a way that unnecessarily disadvantaged another party to the proceedings,(b) whether a party has been responsible for prolonging unreasonably the time taken to complete the proceedings,(c) the relative strengths of the claims made by each of the parties, including whether a party has made a claim that has no tenable basis in fact or law,(d) the nature and complexity of the proceedings, (e) whether the proceedings were frivolous or vexatious or otherwise misconceived or lacking in substance, (f) whether a party has refused or failed to comply with the duty imposed by section 36 (3), (g) any other matter that the Tribunal considers relevant.
The Applicants submitted that the Respondent's case has required the Applicants to obtain legal representation and thereby incur significant costs, both in relation to the appeal and also the hearing in relation to damages.
APV wrote in his statement of 14 August 2015 that on 13 August 2013 the Applicants informed the Tribunal that they had "sought legal advice". That statement, as far as it goes, does not, indicate to me that that represented some start date after which each step in the ongoing proceedings was taken with legal advice.
In the previous proceedings I observed (at [35]) that the Applicants would have no entitlement to costs because they were, for the period of that matter, unrepresented. I see no reason to revisit that view.
Next, dealing with costs in relation to the Appeal, which I understand the Applicants to be presently seeking, the Applicants contend that the Respondent brought an appeal which was "substantially unsuccessful" and that the appeal required the Applicants to incur significant additional costs in having their application determined. Irrespective of the outcome of the present hearing in relation to damages, the Applicants, it was submitted, should be awarded their costs of the Appeal. The Respondent disputed the Tribunal's power to award costs of the Appeal Panel proceedings. It is not necessary for me to come to a view about this issue, because it seems fundamental to me that if the Applicants, who were represented by counsel in the appeal, wished the Appeal Panel to award them costs, they could have and should have raised this issue at the time of the hearing of the appeal. Even if I had the power to do so, it is not for me to now set about evaluating their entitlement, or otherwise, to costs, in circumstances where they had ample opportunity to do so before the Appeal Panel, and particularly in view of the general rule, that, absent special circumstances (which the Applicants bear the onus of demonstrating), parties to proceedings before the Tribunal are to pay their own costs.
As to the present proceedings, I note that the Appeal Panel decision had been handed down at the end of November 2014. The solicitor for the Applicants had appeared at a planning meeting held on 3 March 2015 for the purpose of the present proceedings, and the first correspondence received by the Tribunal from the Applicants' solicitor was dated 19 June 2015. Further, I observe that the Applicants' Notice of Representation was not filed until 29 April 2016, namely the day after the hearing.
The Applicants contended that the Respondent had raised, late in these proceedings, substantial issues in relation to the nature and quality of the personal information and this required the Applicants to put on further evidence in reply. The Respondent did not raise this issue "late" as the Applicants assert; the Respondent's evidence and submissions for this phase of the proceedings were filed in September 2015 pursuant to the timetable I set for preparation for the hearing on damages. The Applicants then had over five months, until March 2016, to put on their reply evidence prior to the hearing in April 2016.
In all, I do not find there to be special circumstances warranting an order for costs in favour of the Applicants in this matter. Each party should bear their own costs, consistent with s 60(1) of the CAT Act.

DECISION and ORDERS 1. Pursuant to section 55(2)(a) of the Privacy and Personal Information Protection Act 1998 , the Respondent is to pay to the Applicant damages of $5,000. 2. Each party is to pay its own costs. 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: 27 July 2016

At a glance

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Judgment (9 paragraphs)

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Cases Cited (6)

Cited By (14)