Blue Bella Pty Ltd t/as Quantum Change Seminars v Gibson

NCAT Appeal Panel|2015-09-18

reasons for decision

This is an appeal against the decision of the Tribunal made on 3 July 2015 in which the appellant was ordered to refund to the respondent the sum of $5,800.00 which had been paid by the respondent to the appellant for an escorted tour to Egypt with an itinerary for travel in December 2014.
The Tribunal published reasons for decision dated 3 July 2015 (Decision) following a hearing on 18 June 2015. In the Decision the Tribunal found that the appellant had failed to comply with the guarantee in section 62 of the Australian Consumer Law (NSW) (ACL). Section 62 broadly provides that, where a supplier supplies services to a consumer in trade or commerce, and the time for the provision of services is not fixed by the contract or does not otherwise provide the manner for determining the time for supply, there is a guarantee that the services will be supplied within a reasonable time. The Tribunal found that the appellant was to supply a tour which departed in December 2014 "however due to two families not being able to travel at that time a commercial decision was made to postpone the tour until December 2015": see Decision at [14].
The Tribunal concluded that the supply of travel services twelve months after the proposed date for travel, contrary to the itinerary that was given to the respondent prior to entering her contract, was not supply within a reasonable time.
In reaching this conclusion, the Tribunal placed "little weight" on the appellant's evidence that the respondent had agreed to travel in 2015, and the Tribunal determined that the respondent "was not bound by that verbal agreement": see Decision at [16].

Hearing of the appeal

During the hearing of the appeal, each of the appellant and the respondent made oral submissions. Ms Faddoul appeared on behalf of the appellant and the respondent appeared in person.
Ms Faddoul referred to various documents and evidence that had been filed. However, the appellant did not have an audio recording of the hearing before the Tribunal and Ms Faddoul said the appellant did not want a further adjournment of the appeal for the purpose of obtaining the audio recording. Accordingly, the Appeal Panel determined to hear the appeal on the basis of the evidence which had been provided to it.
The appellant referred to various documents, including the statements of Sandy Zakoc and Craig Whitely, employees of the appellant.
Ms Faddoul, for the appellant, conceded that there was no dispute that the respondent had booked a trip in December 2014 and that the appellant had agreed to provide a service at this time.
In relation to the alleged variation to the contract to which the Tribunal referred in the Decision, Ms Faddoul said that the appellant did not charge a fee in connection with the change of travel dates. However, the appellant also submitted that the contract did not stipulate a date for the Egypt tour.
The appellant relied on clause 5 of the agreement and submitted that it was only obliged to pay refunds if requested within three days.
When asked by the Appeal Panel whether the contract fixed a time within which the services were to be provided, as contemplated by s 62 of the ACL, Ms Faddoul said "yes". In this regard Ms Faddoul said that a customer had a right to transfer from one tour until the next tour held in the following twelve months.
In relation to the conversation concerning transferring to the 2015 tour, the appellant agreed that no monies were paid by either party in connection with the proposed postponement of the tour. The appellant also submitted that the respondent could again postpone the tour if, for circumstances beyond control of the respondent, she was unable to attend in 2015.
At this point it should be noted that during the course of the appeal the parties accepted that the "special order form" provided with the appeal papers formed part of the contract between the parties.
In reply, the respondent repeated her submissions provided in writing and said that the Tribunal was correct in deciding that the twelve month postponement for the supply of the services was not reasonable.
In substance, the respondent said that the alternative tour date in 2015 was not in fact a postponement of the tour, that she had been provided no dates for the tour in 2015 and, in effect, the tour had been cancelled. The respondent relied upon the brochure provided to her found at page 42 of the respondent's bundle which indicated, at page 44, that the tour to Egypt was to occur between December 3 and December 17 2014.
In summary, the respondent contended that: 1. The services were not provided in a reasonable time; 2. The tour dates had been provided to her and fixed by the promotion of documents; 3. The dates for the tour in 2014 were not tentative; 4. The appellant had made a commercial decision to terminate the tour in 2014 and the alternative dates proposed were not acceptable to the respondent.
Consequently, the respondent submitted the Tribunal had properly ordered she be entitled to a full refund.
In reply, the appellant said the respondent had booked international flights before the tour dates had been confirmed. In this regard the appellant referred to Annexures "F" and "G" of the appellant's bundle. The appellant also said that by email dated 25 November 2014 the respondent had agreed to join the tour in the following year. In this regard the appellant also referred to a second email dated 15 December 2014 said to record discussions regarding the postponement of the 2014 tour.

Consideration

Pursuant to s 80(2)(b) of Civil and Administrative Tribunal Act 2013 (NCAT Act) the appellant may appeal a decision of the Tribunal on a question of law as a right. Otherwise leave is required.
Relevantly, because the Decision was made in the Consumer and Commercial Division, cl 12 of Sch 4 to the NCAT Act applies where leave is required. Clause 12 requires the appellant to demonstrate that it may have suffered a substantial miscarriage of justice because the decision was not fair and equitable or was against the weight of evidence. The principles in Collins v Urban [2014] NSWCATAP 17 are relevant to the grant of leave.
The matters raised in this appeal involve both questions of law and questions for which leave is required.
The issues for determination on appeal can conveniently be summarised as follows: 1. Was the appellant entitled under the terms of the contract to postpone the tour for 12 months from December 2014 to December 2015? 2. If no, was there a: 1. Breach of the contract; or 2. Breach of s 62 of the ACL in that the services were not provided within a reasonable time. 1. Are the parties nonetheless bound by a variation of the contract to the effect that the services be supplied in December 2015 or later? 2. By reason of (1) or (2) above, was the respondent entitled to a refund of the amount she had paid to the appellant for the supply of services in 2014?
The starting point to resolving these issues is to examine the terms of the contract between the parties in connection with the supply of services.
There is no dispute that the contract was entered into in New South Wales. There is no dispute that the claim arises out of the supply of goods and services by the appellant to the respondent who was a consumer within the meaning of the Consumer Claims Act 1998 (CC Act). Accordingly, the Tribunal had jurisdiction in connection with this claim.
It was a term of the contract that the respondent pay to the appellant $5,800 for the tour. There is no dispute that the respondent did this.
There appears to be a dispute about whether or not the brochure entitled "Travel in Majestic Egypt for the Experience of a Lifetime with Memories You will Treasure Forever" (Brochure), being a brochure circulated by the appellant, formed part of the contract. This is relevant in that the Brochure specifies dates for the provision of the services. The Brochure sets out an itinerary for the Egypt trip which commenced with the words "Your Egypt Trip Itinerary… Dec 3rd - 17th 2014".
The Tribunal accepted that the applicant paid the respondent the sum of $5,800.00 for the Egypt trip with an itinerary for the tour from 3-17 December 2014: see paragraphs [3] and [14] of the Decision. However, it should be noted that in [14] the Tribunal described the itinerary as commencing 4 December 2014 not 3 December 2014. This appears to be a typographical error.
While the language in these paragraphs recounts the applicant's evidence, it seems clear from the Decision at [15] that the Tribunal accepted the original offer for the tour was for a departure date in December 2014 "however due to two families not being able to travel at that time a commercial decision was made (by the appellant) to postpone the tour until December 2015": see Decision [14].
The first question to be resolved is whether the appellant was entitled to "postpone" the contract for a period of twelve months or whether the actions in doing so in effect amounted to a cancellation of the contract or otherwise were a breach.
Alternatively, if the contract did not provide for a supply of the services on a specified date, was the offer to supply those services in December 2015 instead of December 2014 a failure to comply with the guarantee in s 62 of the ACL because the services were not provided in a reasonable time?
It is common ground that the contract consists of a document entitled "Special Order Form" and printed terms and conditions identified as "QC Seminars Terms and Conditions".
Those documents are in the materials provided to the Appeal Panel.
For the purpose of the appeal, the appellant accepted the following facts: 1. That it was not in dispute that the tour had been booked to take place in December 2014; and 2. The agreement was to provide the tour service in December 2014.
However, Ms Faddoul said that the Brochure was given to the respondent after she entered the sales contract and that the dates "Dec 3-17 were not set in concrete and was a guide only".
For the purpose of this appeal it is unnecessary to determine the issue of whether or not the brochure was provided to the respondent before or after the Special Order Form was submitted and the deposit paid (a submission made on appeal but for which the appellant does not point to any evidence in support). This is because it is agreed that the contract provided for the supply of services in December 2014, the issue being whether the date could be unilaterally varied to December 2015.
A resolution of this question only requires an examination of the Special Order Form and the QC Terms and Conditions of Seminar.
We should say that, had it been necessary to do so, we would have concluded that the Brochure was part of the agreement as it was the offer document which the Tribunal found was given to the respondent prior to signing and returning the application: see Decision [15]. Further, the fact of its prior receipt is confirmed by the Special Order form which has written on it the words "3-17th". These are the dates found in the Brochure and corroborate the view that the respondent completed the Special Order form after the brochure had been received. It is also consistent with the fact that the appellant says the respondent should not "book her airline tickets" (Decision [14]), advice that could only have been given if particular proposed dates for the tour were known. Consequently, the conclusion of the Tribunal was reasonably available to it.
Therefore, it remains necessary to consider whether the appellant was entitled to postpone the tour for 12 months.
The appellant relied on clauses 3, 5, 8 and 9 of the terms and conditions and upon the statements contained under the heading "FAQ's" in respect of the questions "what is the reason for this policy?" and "I cannot go to the event I booked for - can I transfer to next year's event?".
The effect of the appellant's submissions was that it was entitled to postpone or vary the dates for travel from December 2014 to December 2015.
Clause 3 of the terms and conditions provides as follows: "3. QC Seminars reserve the right to change the Speakers, Event Hours, Dates and/or the Venue for any reason by notifying you in writing of the change and detailing substitute Speakers, Event Hours, Dates and/or the Venue and: (a) We have no liability to you; (b) You shall make no claim against us (including a refund), in respect of the same."
Clause 5 of the agreement provides: "If you advise QC Seminars by providing notice in writing within three (3) business days of placing the Order that you do not wish to receive the training/products this agreement shall be at an end and we shall refund to you all the monies you have paid to us under this agreement. Refunds to you will be made by the same method as payment was received by QC Seminars."
Under the heading "refunds" clauses 8 and 9 provide as follows: "8. QC Seminars may cancel the training or supply of product for any reasons by written notice to you. We will also refund you the amount you have actually paid to us within 10 days of giving you notice of the cancellation. QC Seminars will then have no further liability to you in respect of the cancellation. 9. You acknowledge that you shall not be entitled, and shall not claim a refund other than by strict compliance with clauses 5 and 8 of the QC Seminars Terms and Conditions. You further acknowledge that this is an essential term of this agreement on which QC Seminars rely."
In relation to the information provided under the heading of "frequently asked questions", the following is recorded: "What is the reason for this policy? From the date that you made the initial deposit or payment to attend an event, we begin planning for your attendance and incur costs accordingly, even up to twelve months before the event. Our refund policy reflects this. I can't go to the event I booked for - can I transfer to next year's event? Yes, you can transfer your attendance to another course within 12 calendar months of the original courses start date by notifying us and paying a transfer fee."
In our view, none of these terms permits the appellant to "postpone" or vary the date of the tour to a date 12 months in the future.
Clause 2(a) of the terms and conditions entitles the respondent to "attend the event during the notified times". Clause 3 reserves to the appellant the right to change the speakers, event hours, date and venue. Clauses 8 and 9 provide for a refund if the event is cancelled by the appellant on written notice.
However, there is no express power to postpone a tour to a date to be fixed 12 months in the future.
There is no basis to imply such a term into the contract. It is not a term that is so obvious that it goes without saying and it is not necessary to give business efficacy to the agreement: see B.P. Refinery (Westernport) Pty Ltd v Hastings Shire Council (1977) 180 CLR 266, at 283.
This view is supported by an examination of clause 6 which provides: Transferring Attendance You may choose to attend a different event date. Your payments will be reassigned to the alternative event date, subject to the following criteria: (a) You will still need to make all required payments for that event, and you must attend the event within 12 calendar months of the original event date. (b) If you do not attend the event within 12 calendar months of your final payment, you will forfeit any payment made. QC Seminars reserves the right to charge a transfer fee for all programs. (c) A $500 minimum transfer fee will be incurred to transfer your attendance for any of our Advanced Programs/events, including but not limited to NLP Master Practitioner Certification, NLP Trainer's Training, Million Dollar Speaker Success System, Quit Cigarettes in 60 minutes, HUNA and EGYPT.
The appellant submitted that the "event" to which the contract relates was an event that could take place at any time within a period of twelve months at the election of the appellant.
For the following reasons, such an interpretation is inconsistent with the terms and conditions of the agreement when considered as a whole.
As set out above, there is an express right for the respondent to transfer attendance to a different date under clause 6 of the terms and conditions. However clause 6(a) provides that the respondent "must attend the event within 12 calendar months of the original event date". Clause 6(c) provides that a minimum transfer fee of $500 is payable.
The use of the words "original event date" in clause 6(a) indicates that "the Event" to which the respondent was entitled to attend pursuant to clause 2(a) is a different event to the one to which the respondent could transfer under clause 6(a) and that any event 12 months in the future is not the "original event".
A construction of the agreement that the original event date could be unilaterally varied to a date 12 months in the future from the original scheduled date would be inconsistent with this clause as such an interpretation would mean that the tour services might not be provided for 12 months because of a unilateral decision of the appellant. Further, the supply of services may not occur for up to 2 years if a request is made to transfer under clause 6.
Further, the construction proposed by the appellant would lead to the conclusion that: 1. the appellant could change the event dates to any time many years in the future as there is no term that would limit the varied date to a date not more than 12 months; and 2. a party contracting with the appellant would have no right to claim a refund in respect of such change by reasons of the limitation in clause 3(b).
In our view this interpretation is inconsistent with a contract by which the appellant agreed to provide tour services to Egypt to the respondent in December 2014.
Rather, the use of the word "Event" found in clauses 2 and 3 suggests that any right to change the event date is limited to the period during which the services were to be provided, namely December 2014, not one year in the future.
That is not to say that the appellant was not entitled to cancel the December 2014 tour. As set out above, pursuant to clause 8 the appellant may "cancel the training or supply of product for any reason by written notice" to the respondent. In this case, clause 8 provided that the appellant was to refund to the respondent the amount actually paid and that the appellant would "have no further liability" to the respondent in respect of the cancellation.
There is no dispute that the appellant did not provide the tour in December 2014. While the appellant sought to categorise what occurred as "postponement of the tour", the postponement occurring "as a couple of family groups had at the last minute decided to postpone for the following year", the effect of what occurred is that the tour did not proceed in December 2014 and was therefore cancelled.
The terms of the contract did not authorise the appellant to "postpone" the event for a period of twelve months because one of the other parties to the tour had decided they did not wish to travel at that time. The mere fact that another party may have been entitled to transfer their attendance from the "original event date" to another date within twelve months does not provide a basis for concluding that, on the proper construction of the contract, the appellant could unilaterally decide to postpone the tour for all other participants for an extended period of time.
Further, while the appellant may have cancelled the tour by written notice under clause 8, it did not do so. In any event, if the tour was cancelled, a full refund would still have been payable: see Clause 8.
Consequently, in failing to provide the tour in December the appellant was in breach of the agreement and the respondent was entitled to repayment of all amounts paid as ordered by the Tribunal.
We note that the Tribunal came to a different conclusion as to the construction of the agreement. While we have concluded that the agreement required the supply of the services under the agreement in December 2014, the Tribunal rather concluded that the contract did not specify a date at all. In doing so, the Tribunal did not have regard to the matters we have referred nor did it have regard to whether the Brochure formed part of the agreement, although the Tribunal did determine at [15] that the Brochure was given to the respondent prior to entering the contract.
As we have determined that the dates could be varied under clause 3 to a date in December 2014, it is unnecessary to finally determine if the Brochure was part of the agreement and originally fixed the dates. This is because we have found the dates could be varied provided it was to a date in December 2014. Consequently, it is unnecessary to consider s 62 of the ACL in order to decide this appeal.
In the event that our interpretation of the agreement is wrong and the Tribunal was correct to conclude there was no date fixed for the supply of the services (that is there was no fixed date for the tour and no fixed period within which the tour services were to be provided) we would agree that the provisions of s 62 of the ACL, as set out in paragraph 13 of the Decision, would apply. There is no dispute that the appellant is a supplier which had agreed to supply, in trade or commerce, services to the respondent, being a consumer within the ACL (see ACL, ss 11(b) and 62). It follows that, if the time for supply was not fixed by the contract or was not to be determined in a manner agreed to by the parties, there would be a statutory guarantee pursuant to s 62 of the ACL that the tour services would be supplied by the appellant to the respondent "within a reasonable time".
The Tribunal found, where a tour was originally to be provided in December 2014 (a matter not in dispute in this appeal), that a supply of those services twelve months later was unreasonable for the purpose of s 62 of the ACL. The appellant submitted that the conclusion that twelve months was an unreasonable period was incorrect for a number of reasons: 1. If the respondent was not available to travel in December 2015 she could transfer to another date. In this regard the appellant noted clause 6(c) of the terms and conditions; 2. The respondent could use money towards any other program offered by the appellant and therefore had "many options" available to her; and 3. In any event the respondent had agreed to transfer to the December 2015 tour.
In our opinion, the fact that the respondent may have had a right to transfer from the postponed tour in December 2014 until a subsequent tour in December 2015 or December 2016 does not mean that a period of twelve months is a reasonable time in which to supply a tour originally offered in December 2014. As we said above, this was a right given to the respondent. It was a right to transfer to a different event. It was not a right that authorised a delay on the part of the appellant in providing the services. Rather it is a factor that suggests any supply would not otherwise be delayed for 12 months.
Therefore, the Tribunal was correct to conclude at [15] that a delay in providing the tour services of twelve months was unreasonable in circumstances where the contract provided for a travel date in December 2014 and an itinerary had been given to the respondent prior to her entering the contract.
In this regard, the Tribunal accepted that the Brochure containing the itinerary was given by the appellant to the respondent prior to entry into the contract and it formed part of the circumstances to which the Tribunal had regard in considering what was a reasonable time.
While the appellant sought to challenge the finding that the Brochure had been delivered prior to the Special Order Form being signed and the deposit paid, no evidence was referred to by the appellant to support this submission. Further, and in any event, all of the evidence which was before the Tribunal, including the audio recording, was not provided to the Appeal Panel. As indicated above, the Appeal Panel drew this matter to the attention of the appellant's representative who decided to continue with the appeal rather than seek an adjournment.
Accordingly, no reason has been shown why leave to appeal on this question should be granted nor why the Tribunal was, in any event, in error in reaching this conclusion.
In relation to the submission that the respondent could "use the money paid to any other programs", even if this was correct it does not mean that twelve months was a reasonable time in which the services could be provided. Rather, if, contrary to our finding, the contract did not fix a date for the supply of services by the appellant, s 62 of the ACL imposed upon the appellant the obligation to provide the Egypt tour within a reasonable time. The availability of other activities to which the respondent might apply any monies paid is completely irrelevant to this question.
Finally, in relation to the question of whether or not the respondent agreed to "transfer her attendance to DEC 2015", thus varying the contract, in our view there is no basis to disturb the Tribunal's conclusions that: 1. There was a no verbal agreement to vary the contract to provide for travel in December 2015; and 2. Even if the agreement had been verbally varied, the respondent was not bound.
In relation to the first aspect, namely whether there had been a verbal agreement, it is clear that the Tribunal did not accept the evidence of the respondent to this effect.
An appeal on this aspect of the decision would require leave of the Appeal Panel and would require the Appeal Panel to have regard to all the evidence of the parties to determine whether or not leave should be granted.
In this regard the Tribunal may only grant leave to appeal from a decision of the Tribunal exercising a function in the Consumer and Commercial Division if it is satisfied that the appellant may have suffered a substantial miscarriage of justice. This requires the Appeal Panel to be satisfied that the decision was against the weight of evidence or was not fair and equitable.
However, in the present case all relevant evidence, including the audio recording, has not been placed before the Appeal Panel. Again, the Appeal Panel notes the appellant's representative was given an opportunity to produce all the evidence but she chose not to do so.
In these circumstances, an evaluation of the evidence is not possible and there is no proper basis for the Appeal Panel to conclude on the material provided to it that the Tribunal was in error.
Finally, even if it was accepted that there had been a conversation in which the respondent indicated a preparedness to travel in December 2015, in our opinion such a statement would not have constituted a variation to the contract which was enforceable at law.
For a variation to be enforceable, the usual principles of contract formation apply. There must be offer, acceptance and consideration: see eg Black v NSW Land and Housing Corporation [2014] NSWCATAP 113 at [15].
In the present case, the appellant conceded that it did not charge any fee in connection with any transfer nor was any consideration for the contract variation identified by the appellant. Further, no specific date was fixed for any tour in December 2015. Rather, the date for any alternative tour remained imprecise other than it was expected to be in December 2015.
Consequently, in our view there was no valid variation of the original supply contract which bound the parties and the Tribunal was correct to conclude that the respondent was not bound by any agreement to the effect that the supply of the Egypt tour was to occur in December 2015.
Having regard to the above, leave to appeal should be refused and the appeal should be dismissed.

Orders

The Appeal Panel makes the following orders: 1. Leave to appeal refused; and 2. The appeal is otherwise dismissed.

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

Amendments 18 January 2016 - name on coversheet DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 18 January 2016

At a glance

Court

Decision date

Source

Judgment (7 paragraphs)

Parties

Cases Cited (3)