C & I Zubrycki t/as President Homes Building & Construction v McCaughan

NCAT Appeal Panel|2017-02-01|Before: Bailey AM

REASONS FOR DECISION

This is an appeal from a decision of the Consumer and Commercial Division of the Tribunal in matter HB 16/41086 made on 30 September 2016 to dismiss an application to set aside the orders made by the Tribunal on 7 September 2016 in HB 16/22888. The appeal necessarily also involves some consideration of the efficacy of the latter orders.
The decision of the Tribunal under appeal was a decision made in proceedings for a general decision and thus was an internally appealable decision under s 32 of the NCAT Act. The Appellant was entitled to appeal as of right against the decision on a question of law and by leave on any other ground, under s 80(1) and (2) of the NCAT Act.
At the hearing on 1 February 2017 the Appeal Panel made an order that the appeal be dismissed and reserved the publication of reasons. These are the reasons for the order for dismissal.

Background

To permit consideration of the appeal the Tribunal has identified the sequence of relevant events, including all procedural steps in both proceedings. The history set out below has been primarily extracted from documents in the Tribunal file.

C & I Zubrycki - the Appellant, and Angela McCaughan - the Respondent 1. Contract Executed 4 May 2014 2. March 2015 Occupation Certificate. 3. October 2015 Respondent Contacts Fair Trading: meeting, no settlement. 4. Further November Fair Trading meeting. Appellant did not attend. 5. Some minor defects attended to after October meeting. 6. Incidents during January & February 2016. 7. March 2016 Respondent engaged Mr Anthony Capaldi of Tyrrells. 8. 15 May 2016 Application HB/ 16/22888 filed with NCAT. 9. 26 May 2016 Notice of Directions Hearing sent to parties. 10. 14 June 2016 Directions Hearing. Appellant did not attend. Directions made for Appellant's documents to be filed by 14 July 2016 and Respondent's by 28 July 2016. Christopher Michael Zubrycki and Imelda Bernadette Zubrycki added as parties. 11. 30 June 2016 Notice of Directions Hearing sent to parties. 12. 9 August 2016 the hearing was adjourned to a date to be fixed. New date to be advised. Direction that by 16 August 2016 Appellant to advise the Respondent and NCAT the names of witnesses required for cross-examination. 13. 23 August 2016 Notice of Hearing sent to parties. 14. On 5 September 2016 the Appellant wrote to NCAT advising of his new address. The Appellant was told that the matter was set down for hearing on 7 September and was asked if he was seeking an adjournment. 15. On 6 September 2016 Appellant emailed NCAT seeking an adjournment. The application for an adjournment was refused in Chambers on the basis that insufficient reason was given to warrant an adjournment. The Appellant was further advised that the matter remained listed and that his attendance at the hearing was requires. 16. On 7 September 2016 the hearing proceeded in the absence of the Appellant. The Tribunal Member Vrabac made orders ("the Initial Orders") including: 1. The respondent's application for adjournment is not granted. 2. C & I Zubrycki t/as President Homes is to pay to Angela McCaughan the sum of $55,172.04 immediately. 1. On 13 September 2016 the respondent filed an Application to Set Aside the orders made in HB 16/22888. This application was given file no HB 16/41086. 2. In HB16/22888 a stay was ordered upon the filing of the above application. 3. On 14 September 2016 in HB 16/41086 a stay order was made and orders made for the Respondent to make submissions by 21 September 2016 and the Appellant in reply by 28 September 2016. Submissions were made by both parties. 4. On 30 September 2016 the Tribunal (Member D Charles) considered the set aside application and made orders dismissing the application and provided reasons. ("the Set Aside Order"). 5. On 30 September 2016, formal orders were made noting that the stay order in HB 16/22888 had been lifted and that the orders in HB 16/22888 remained in force. 6. On 4 November 2016 an application for a stay and a Notice of Appeal (dated 1 November 2016) were filed in relation to proceedings HB 16/41086, ("the Notice of Appeal) which also applies to matter HB 16/22888. The grounds of appeal were: 1. A denial of procedural fairness. 2. A denial of natural justice. 3. A decision was made without the Tribunal enquiring as to the financial circumstances of the Appellant. 1. The Notice of Appeal as filed as Appeal AP 16/48504, was that addressed by this Tribunal on 1 February 2017. 2. On 4 November 2016 Principal Member Rosser as the Appeal Panel ordered that: 1. Orders made on 7 September 2016 be stayed until the date on which the appeal proceedings are listed for call over. 2. Should the appellant seek to have the stay order continued, a statutory declaration or affidavit setting out the appellant's current financial circumstances and a written submission in support of the continuation of the stay is to be provided to the Tribunal and the respondent by no later than 72 hours prior to the date of the call over. 1. Further on 4 November 2016 a Notice of Call Over and Hearing to Determine Stay on Original Orders was issued which notified Thursday 24 November 2016 at 11.00am for a call over. 2. On 16 November 2016 the Respondent filed her Reply to Appeal 3. On 24 November 2016 Directions were made by the Appeal Panel constituted by D Cowdroy ADCJ: 1. Leave for Appellant to be represented by Mr L Jackson. 2. Appellant by 15 December 2016 to lodge and provide to the Respondent written submissions in support of the appeal. 3. Respondent by 15 January 2017 to lodge and provide to the Appellant submissions in opposition to the appeal if the Respondent considers her Reply is not sufficient. 4. Appeal listed for HEARING on 1 February 2017. The tribunal also noted that no application had been made to extend the stay granted on 4 November 2016 and that the conditions for an extension beyond 24 November 2016 had not been complied with. (see Order 2 made on 4 November 2017) 1. The parties lodged submissions as directed.

The Initial Orders

The Application in HB 16/22888 filed on 15 May 2016 and the Notice of Directions Hearing dated 26 May 2016 were both served on the Appellant. There is no evidence to suggest otherwise. The Appellant was accordingly on notice that the Respondent was seeking a monetary order for $64,863.74.
The Appellant did not appear and was not represented at the first Directions Hearing on 14 June 2016 and there is no evidence as to why not.
The Appellant did not appear and was not represented at any further Directions Hearings and did not respond to any communications from the Tribunal.
In the course of the Set Aside application the reliance was placed upon a problem with delivery of mail after June 2016 when the Appellant moved to a new address. This was addressed by the Tribunal in the Se Aside Orders made on 30 September 2016. See paragraph 17 below.
It seems to us that with knowledge that a claim was being pursued in the Tribunal against the Appellant for over $50,000 the unexplained failure to take any action or to make any enquires of the Tribunal was irresponsible to say the least.
The Appellant contacted the Tribunal on 5 September 2016 by telephone and sought an adjournment on the basis of a work commitment. The application was declined. The Appellant was advised that the matter would proceed on the date fixed of 7 September 2016 and that there should be an attendance. The Appellant nevertheless did not attend the hearing and made no arrangements to be represented.
On occasions an inability to attend a hearing, or even a failure to attend might be accepted as a basis to set aside orders made in a party's absence pursuant to Clause 9 of the Regulations, see for example Waters v Chai [2016] NSWCATAP 248. On occasions on an appeal from the dismissal of a set aside application the initial orders might be varied, see Homeark Constructions v Hillside Excavations [2014] NSWCATAP 77 and Buildex Australia Pty Ltd v Soud [2016] NSWCATAP 83. Having regard to the procedural limitations explained in Hammond v Ozzy's Cheapest Cars Pty Ltd t/as Ozzy Car Sales [2015] NSWCATAP successful set aside applications will be infrequent.
On the 7 September 2016 the Appellant made a request that a telephone conference be arranged so that the adjournment application could be further considered. The presiding member did not make a telephone call and refused to entertain any further requests for an adjournment. In the reasons for the decision the presiding member referred to the history of the proceedings and the explained reluctance of the Respondent for a work order. The adjournment was not granted because an unreasonable disadvantage would have been caused to the applicant. She has tried to communicate with respondent since October 2015 to resolve the dispute. The respondent would not co-operate. There was no prospect on the evidence give today of making a work order as a preferred outcome in the dispute in accordance with the principle stated in s 48A of the HB Act because of the enmity and distrust the applicant has for the respondent. The respondent was told that the matter is listed today. He did not send a representative. Work commitments are not generally a ground for an adjournment. The respondent chose to run a risk of having the matter determined in his absence. I did not call the respondent when I received his note for two reasons. He was told to appear at the hearing, he did not do this. He sought a telephone call, but by the time I received the note the hearing was mostly completed. I also note that the Tribunal's notices of hearing and directions were not returned to the Tribunal when they were posted to the respondent's last known address.

Set Aside Orders

The Set Aside Application was filed on 13 September 2016 and given File No HB 16/41086. Directions were made for both parties to provide written submissions and these were before the Tribunal when the application was addressed by the Tribunal.
The Appellant's application to set aside the decision of 7 September 2016 was considered by the Tribunal "on the papers", that is without a hearing. That course was permitted pursuant to clause 9(8) of the Regulation and section 50(1)(d) of the Act.
On 30 September 2016 the Tribunal dismissed the application and lifted the stay made on 14 September 2016 in File HB 16/22888. The Tribunal referred to Clause 9(1)(b) of the Regulation noting that there are two requirements to be satisfied (ie the party's absence and the absence resulting in that party's case not being adequately put to the Tribunal). The Tribunal noted that if the requirements are satisfied then the Tribunal has a discretion to set the decision aside, but that it was not mandatory that it do so, and further that the Tribunal must have regard to what was stated in paragraph 80 in Hammond v Ozzy's Cheapest Cars Pty Ltd t/as Ozzy Car Sales [2015] NSWCATAP 65. In summary, when exercising the discretion conferred by cl 9(1)(b), the Tribunal should direct its attention to whether there would be a real likelihood of injustice if the decision was allowed to stand. Relevant considerations will generally include: (1) Why the party was absent and whether the absent party had a reasonable opportunity to be heard or otherwise have its submissions considered in the proceedings; and (2) Whether the absent party has an arguable defence or an arguable case that a different decision could have been reached.
The Tribunal identified the issues as being: 1. Was the decision made in the builder's absence? 2. If so, did the absence result in the set aside applicant's case not being put to the Tribunal? 3. If so, should the Tribunal exercise its discretion to set aside the order that the builder should pay the home owner the amount of $55,172.04?
The Tribunal concluded Issue 1 in the affirmative and as to Issue 2: This requires consideration of the circumstances leading up to the presiding member's decision on 7 Sept 2016. There was ample evidence for the presiding member to find that notices of hearings and directions in File No 16/22888 were not returned to the Tribunal when they were posted to the set aside applicant's last known address. The set aside applicant says that he and wife had a 'mail diversion' from their old address at Castle Hill (to which the Tribunal had been sending the notices) to their new address at Kellyville. In the Tribunal's determination, the efficacy of any mail diversion arrangement could and should been regularly checked. No satisfactory explanation for this is given in the set aside applicant's submission. In any event, on the set aside applicant's own evidence, he says that he first became aware of the hearing scheduled to take place on 07 Sep-2016 (a Wednesday) on the Friday before the hearing (ie on 02 Sep-2016). He then applied for an adjournment which was refused by a member (in chambers) on 06 Sep-2016. He did not attend the hearing because of work commitments (not usually a reason for an adjournment), the other respondent, (his wife) in File No HB 16/22888 did not attend the hearing, and he did not arrange representation by any other person at the hearing. A further request of the set aside applicant was given to the presiding member on 07 Sep-2016. The presiding member considered such request and dealt with it in his Reasons (the relevant part of the Reasons is set out above).
The Tribunal then reviewed the approach taken by the presiding member: The Tribunal considers that the presiding member's observations and comments were justified and appropriate in all the circumstances. The guiding principle for the Tribunal is to facilitate the just, quick and cheap resolution of the issues in the proceedings and the parties to the proceedings have a legislative obligation to co-operate with the Tribunal in facilitating that guiding principle: se s36(6) of the Act. The Tribunal does not consider that any of the reasons put by the set aside applicant in his written submission justify his (or his wife's) failure to appear on 07 Sep-2016, or to arrange representation on their behalf. The Tribunal concludes that it was not the set aside applicant's absence from the hearing on 07 Sep-2016 that resulted in the builder's case not being adequately put to the Tribunal on 07-Sep-2016; rather, it was the builder's own omissions in not checking the efficacy of the mail diversion arrangement for the Castle Hill address, in not preparing for the hearing (including providing documents in compliance with the Tribunal's prior directions) and not making proper arrangements to appear (either himself or his wife) or at least, for he and his wife to be represented at the hearing by a duly authorised person. Accordingly the Tribunal is not satisfied that the requirement in Issue 2 is met.
Further the Tribunal determined that even if it had reached a different conclusion in relation to Issue 2, it was not satisfied that it should exercise its discretion to set aside in any event and referred to the reasons in the Initial Orders as set out in paragraph 12 above.
Further the stay order in proceedings HB 16/2288 was lifted.

Grounds of Appeal

The Notice of Appeal was filed on 13 September 2016.
The first and second Grounds of Appeal are set out in paragraph 4(22) above. These involve allegations of an absence of procedural fairness. As such they involve potential errors of law and are appealable as of right pursuant to s 80(2)(b) of the Act.
It is abundantly clear to us that as explained in the reasons of the Tribunal on the set aside application, set out in paragraph 18 above, that the primary, if not the only reason that the appellant's case was not able to be heard was the irresponsible approach of the appellant to the conduct of the defence to the claim in HB 16/22888.
The third ground of appeal contends that the Tribunal proceeded without enquiring as to the financial circumstances of the appellant. On 4 November 2016 the Tribunal ordered a stay of the Orders made in HB 16/22888, effective up to the date of the call over in the appeal proceedings, see paragraph 4 (24) above.
The Tribunal further directed that if the Appellant wished to have the stay extended beyond the date of the call over, then evidence as to the financial circumstances of the Appellant and submissions in support should be filed prior to the date of the call over.
The call over occurred on 24 November 2016 and apart from directions for the parties to lodge and provide submissions, the Tribunal noted that the conditions for an extension of the stay had not been complied with, see paragraph 4 (25).
The Appellant did not, in support of the appeal, provide evidence as to financial circumstances, although the appeal submissions alluded to certain consequences of the judgement which had been obtained. The set aside Tribunal had nothing before it which could have it to "enquire" as to the Appellant's financial circumstances. Likewise the Appeal Panel has not been provided with such evidence.

Conclusion

For the reasons set out above, the Appeal Panel could find no error in the decision of the Tribunal to refuse to set aside the orders made on 7 September 2017 and dismissed the appeal 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 14 March 2017 - 14 March 2017 - Paragraph 4 (16) members name added. 14 March 2017 - Paragraph 4 (16) members name corrected. 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: 14 March 2017

Civil and Administrative Tribunal Regulation 2013(NSW)

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