E Bishop SC, Senior MemberP H Molony, Senior Member
Catchwords
CONSUMER LAW — Consumer guarantees — Supply of services —
measure of damages under s 267(4) CONSUMER LAW — consumer
claim made under the Fair Trading Act 1987 (NSW) — jurisdiction of NCAT
— New Zealand company not a small proprietary company under s 79D —
Source
Original judgment source is linked above.
Catchwords
CONSUMER LAW — Consumer guarantees — Supply of services —measure of damages under s 267(4) CONSUMER LAW — consumerclaim made under the Fair Trading Act 1987 (NSW) — jurisdiction of NCAT— New Zealand company not a small proprietary company under s 79D —effect of s 79H placing onus on person asserting nojurisdiction. PRACTIVE AND PROCEDURE — r 29 of the Civil and
Administrative Tribunal Rules 2014 — an entity substituted as a party to
a completed consumer claim, after an appeal is commenced, is not thereby made a
party
to the appeal by operation of r 29(1)(b) —procedure to be followed
Wilson v Chan & Naylor Parramatta Pty Ltd atf Chan & Naylor Paramatta Trust [2020] NSWCA 62
[29]
These reasons concern an appeal by Catallyze Pty Ltd (Catallyze) against an order made by the Tribunal on 15 July 2023 that:
[30]
"Catallyze Pty Limited, of [address] NSW 2025 pay JAB Holdings Pty Limited, of [address] New Zealand, the sum of $12,726 within 14 days."
[31]
The Tribunal provided written reasons for that decision (the decision).
The appeal was made within time.
The appeal has been complicated by issues concerning who is the proper respondent to the appeal (and the applicant in the initial Tribunal proceedings). The possibilities are:
[32]
(1) JAB Holdings New Zealand Limited (JAB-NZ), a company that has at all material times been incorporated in New Zealand; but which has never been registered in Australia as a foreign company as defined in s 9 of the Corporations Law.
(2) JAB Holdings (AU) Pty Ltd (JAB-AU), a company that the parties agree was incorporated in Australia on 13 April 2023.
(3) JAB Holdings Pty Ltd (JAB), the name most frequently used in the proceedings, which on the evidence before us does not exist and is not incorporated in either Australia or New Zealand. It is trite law that because JAB is not incorporated, it is not a legal person and cannot sue or be sued.
[33]
JAB has often been used when referring to JAB-NZ and/or JAB-AU.
Neither party was legally represented in the appeal. Catallyze was represented by Mr Webb, a director, and the respondent by Dr van Deventer, the sole director of JAB-NZ and JAB-AU.
(a) in the case of an interlocutory decision of the Tribunal at first instance - with the leave of the Appeal Panel, and
(b) in the case of any other kind of decision (including an ancillary decision) of the Tribunal at first instance - as of right on any question of law, or with the leave of the Appeal Panel, on any other grounds.
[36]
A question of law may include, not only an error in ascertaining the legal principle or in applying it to the facts of the case, but also in taking into account an irrelevant consideration or not having regard to a relevant consideration. This includes not making a finding on a central issue that is required to be made out in order to claim an entitlement to relief: see CEO of Customs v AMI Toyota Ltd[2000] FCA 1343; (2000) 102 FCR 578 (Full Fed Ct), [2000] FCA 1343 at [45], applying the statement of principle in Craig v South Australia[1995] HCA 58; (1995) 184 CLR 163 at 179; [1995] HCA 58.
An appellant to an internal appeal brought under s 80(2)(b) of the NCAT Act must identify with precision a question of law said to be raised by the appeal: Ferella & Anor v Chief Commissioner of State Revenue[2014] NSWCA 378 at [6], [22]; Schwartz Family Co Pty Ltd v Capitol Carpets Pty Ltd[2017] NSWCA 223 at [13].
Whether a question is one of law must be approached as a matter of substance: Haritos v Federal Commissioner of Taxation ; at (6), [94], [203]; at . In ; () at [109], Bathurst CJ and Bell P (as the Chief Justice then was) said, with Garling, Johnson and Lonergan JJ agreeing:
[37]
"Those questions of law should be, in our opinion, what are sometimes described as 'pure questions of law.' They should not draw the Court of Criminal Appeal into questions of fact. Moreover, they must be questions whose character as a question of law can be recognised on the face of the question, and not depend upon the answer given to the question. This does not include a question which may ultimately disclose an error of law depending on an analysis of the facts but where this cannot be known without scrutiny of the facts."
[38]
In Unique Commercial Group Pty Ltd v Cusumano[2024] NSWCATAP 204 at [24]- [40], the Appeal Panel set out the principles concerning questions of law within s 80 of the NCAT Act. An appellant is required to identify a pure question of law which then becomes the subject matter of the appeal: Wilson v Chan & Naylor Parramatta Pty Ltd atf Chan & Naylor Paramatta Trust[2020] NSWCA 62 at [4] and [11]; Orr v Hunter Quarries Pty Ltd[2022] NSWCCA 39 at [12], [14]; Cobar.
Examples of pure questions of law include:
[39]
(1) Denial of procedural fairness (Prendergast v Western Murray Irrigation Ltd[2014] NSWCATAP 69 at [13](4)) (Prendergast); FVA v Commissioner for Police, NSW Police Force[2024] NSWCATAP 127 at [83]- [84]).
(2) A constructive failure to exercise jurisdiction, which includes the failure to consider and address a material issue raised by a party in the proceedings that is within the jurisdiction of the Tribunal to determine (Alexandria Landfill Pty Ltd v Transport for NSW(2020) 103 NSWLR 479; [2020] NSWCA 165 at [8]- [12] and [413]). This category of error also includes a failure by the Tribunal to engage with a clearly articulated argument put to it.
(3) The construction of a statute or contract arrived at by the Tribunal at first instance was wrong in some identified way.
(4) Acting on the application of the wrong legal principle which materially affected the outcome (Bimson, Roads & Maritime Services v Damorange Pty Ltd[2014] NSWSC 734 at [38]- ).
[40]
The circumstances in which the Appeal Panel may grant leave to appeal from a decision made in the Consumer and Commercial Division are limited to those set out in cl 12(1) of Sch 4 of the NCAT Act.
The principles governing an application for leave to appeal under the NCAT Act are well established and repeated in many decisions of the Appeal Panel, often quoting Collins v Urban[2014] NSWCATAP 17 (Collins v Urban). The Appeal Panel must be satisfied that the appellant may have suffered a substantial miscarriage of justice because:
[41]
(1) the decision of the Tribunal under appeal was not fair and equitable; or
(2) the decision of the Tribunal under appeal was against the weight of evidence; or
(3) significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with).
[42]
In Collins v Urban, the Appeal Panel stated at [76], that a substantial miscarriage of justice for the purposes of cl 12(1) of Sch 4 of the NCAT Act may have been suffered where:
[43]
"... there was a 'significant possibility' or a 'chance which was fairly open' that a different and more favourable result would have been achieved for the appellant had the relevant circumstance in para (a) or (b) not occurred or if the fresh evidence under para (c) had been before the Tribunal at first instance."
[44]
Even if an appellant from a decision of the Consumer and Commercial Division requiring leave to appeal has satisfied the requirements of cl 12(1) of Sch 4 of the NCAT Act, the Appeal Panel must still consider whether it should exercise its discretion to grant leave to appeal under s 80(2)(b) of the NCAT Act. The appellant must demonstrate something more than the Tribunal was arguably wrong: Pholi v Wearne[2014] NSWCATAP 78 at [32].
In Collins v Urban, the Appeal Panel stated at [84] that ordinarily it is appropriate to grant leave to appeal only in matters that involve:
[45]
(1) Issues of principles;
(2) Questions of public importance or matters of administration or policy which might have general application;
(3) An injustice which is reasonably clear, in the sense of going beyond merely what is arguable, or an error that is plain and readily apparent which is central to the Tribunal's decision and not merely peripheral, so that it would be unjust to allow the finding to stand;
(4) A factual error that was unreasonably arrived at and clearly mistaken; or
(5) The Tribunal having gone about the fact finding process in such an unorthodox manner or in such a way that it was likely to produce an unfair result so that it would be in the interests of justice for it to be reviewed.
[46]
In respect of a self-represented, non-legally trained appellant, grounds of appeal should be considered generally (subject to procedural fairness considerations) to determine whether a question of law has been raised: Prendergast at [12]; Cominos v Di Rico[2016] NSWCATAP 5 at [13].
An appeal is not an opportunity for a losing party to run their case again: Ryan v BKB Motor Vehicle Repairs Pty Ltd[2017] NSWCATAP 39 at [10].
[47]
On 16 October 2023 Dr Sean van Deventer filed a consumer claim in the Consumer and Commercial Division of the Tribunal, naming Catallyze as respondent and seeking orders for the provision of work and services promised under a contract. Those original proceedings were numbered 2023/00371227 (the consumer claim).
At the first listing of the consumer claim, on 3 November 2023, the name of the applicant was changed from that of Dr van Deventer to JAB. Directions were made for the filing of evidence and materials, and the proceedings were adjourned to a date to be fixed.
The substantive hearing then occurred over two days, 14 February 2024 and 6 May 2024; following which the Tribunal reserved it decision. On 15 July 2024, the Tribunal provided written reasons for the decision in the original application and made an order that Catallyze pay JAB the sum of $12,726 as damages within 14 days.
While we will need to address the decision in some detail for the present purposes, we note that:
[48]
(1) The Tribunal on the second day of hearing asked whether it was agreed that JAB was incorporated in Australia. Catallyze did not agree. The Tribunal shortly thereafter said:
[49]
"I have now done a Google Search and confirmed JAB Holdings is registered with ASIC and therefore I do not need agreement of the parties."
[50]
"The Presiding Member accepts that the Applicant provided the respondent with evidence that the Applicant was registered in Australia in or shortly after the meeting of 17 April 2023."
[51]
On 22 July 2024 Catallyze filed a notice of appeal against the decision made in the consumer claim. The appeal proceedings were numbered 2024/00271227 (the appeal proceedings).
On 7 August 2024 the order made by the Tribunal in the consumer claim was stayed by an Appeal Panel constituted by Senior Member Sarginson (as he then was). The order made on 7 August 2024, in the appeal proceedings, contained the following note:
[52]
"The Tribunal notes that the respondent to the appeal (who was successful before the Tribunal) asserts that the orders of the Tribunal dated 15 July 2024 incorrectly describe the name of the respondent. The respondent asserts that its correct legal entity is JAB Holdings AU Pty Ltd, not JAB Holdings Pty Ltd and that JAB Holdings Pty Ltd is not a related entity or an entity which Mr Van Deventer (director of JAB Holdings AU Pty Ltd) is involved. The position of the respondent appears to be that the name was amended during the Tribunal proceedings incorrectly at the Group List and Conciliation hearing, and this was not an issue that was further identified or raised prior to the Tribunal's decision of 15 July 2024. The respondent intends to file a Miscellaneous Orders application with the Tribunal to amend the name. Both parties are encouraged to obtain advice about this issue, including the NSW Court of Appeal decision in Sunaust Properties Pty Ltd t/as Central Sydney Realty v The Owners Strata Plan No 64807 [2023] NSWCA 188 and the provisions of Reg 9(1 )(a) of the Civil and Administrative Regulation 2022."
[53]
On 6 September 2024, in response to the filing of a miscellaneous application in the consumer claim by JAB-AU, seeking to change the applicant's name from JAB to JAB-AU, the Tribunal established a timetable for the filing of submissions and materials relating to that issue, with a view to it being determined on the papers. The miscellaneous application, which was completed by Dr van Deventer, said that the Tribunal had been aware of the correct name, JAB-AU, but that the "AU was left off the Tribunal's decision". He wrote:
[54]
"I am the owner and only person working for the company. The company name is JAB Holdings AU PTY LTD. We generally refer to the company as JAB Holdings but for the purposes of the Tribunal decision, we should use JAB Holdings AU PTY LTD. Can we please change the name to JAB Holdings AU PTY LTD so that I can enforce the decision...."
[55]
On 16 October 2024, a differently constituted Tribunal considered the miscellaneous application, dispensed with a need for a hearing, and amended the name of the applicant in the consumer claim from JAB to JAB-AU. Catallyze opposed the amendment on the basis that it had not dealt with JAB-AU, but a New Zealand company. In written reasons for that decision the Tribunal wrote:
[56]
"1. On 16 October 2023 an application was lodged by Sean Van Deventer against Catallyze Pty Ltd. At a directions hearing on 3 November 2023, the name of the applicant was changed to JAB Holdings Pty Ltd. Following a hearing on 14 February 2024 and 06 May 2024, on 15 July 2024 proceeded to a final hearing which resulted in an order being made for Catallyze to pay JAB Holdings Pty Ltd $12,726 within 14 days.
2. An appeal was lodged by Catallyze Pty Ltd. At a call-over hearing on 7 August 2024 a stay order was made, the effect of which was to halt the obligation for Catallyze Pty Ltd to pay JAB Holdings Pty Ltd. On that occasion, it was indicated that any request to lift or vary the stay could be made and would be considered on 25 September 2024, at the next call-over hearing.
3. On 7 August 2024 it was also suggested that the correct party was JAB Holdings AU Pty Ltd, not JAB Holdings Pty Ltd. The Tribunal has received submissions for Catallyze Pty Ltd dated 13 September 2024 and from Mr Van Deventer on 20 September 2024.
4. As there is no consent to the requested change in the name of the company, s 9(1)(a) of the Civil and Administrative Tribunal Regulation 2022 (NSW) cannot be used. However, the decision of the Court of Appeal in Sunaust Properties Pty Ltd t/as Sydney Realty v The Owners Strata Plan 64807[2023] NSWCA 188 establishes that s 38 of the Civil and Administrative Tribunal Act 2013 (NSW), coupled with s 36(1) of that Act can be used to make a correction such as that which the Tribunal is satisfied is warranted in this case since it appears that the change in the name of the applicant from Sean Van Deventer to JAB Holdings Pty Ltd should have been to the company with the name JAB Holdings AU Pty Ltd.
[57]
JAB-AU subsequently made an application in the appeal proceedings to have the stay order lifted, which application was dismissed by an Appeal Panel (again differently constituted) on 23 October 2024. The name of the respondent appearing on that order is JAB.
The appeal was listed for hearing before us on 2 December 2024. We had copies of orders and directions made in the appeal proceedings that mentioned issues being raised as to whether the correct legal entity of the appellant was JAB or JAB-AU. We did not have a copy of the Tribunal's order of 16 October 2024 in the consumer claim, as they did not relate to the appeal proceedings. As a result, we were not aware that the name of the applicant in the consumer claim had been changed to JAB-AU and proceeded to hear the appeal on the understanding that the respondent company was JAB.
After hearing submissions from Dr van Deventer for JAB and from Mr Webb for Catallyze we reserved our decision.
We note that during the appeal hearing some time was spent by us addressing the issue, apparent from the original paperwork, of whether JAB was a New Zealand company, and as to how it could bring a consumer claim in NSW. It is evident that we were at cross-purposes with Dr van Deventer during this discussion, which, in retrospect, partially explains why we had difficulty understanding his position.
When considering our decision in the matter, after the hearing, we checked the orders made in the appeal in an effort to make sure we fully understood what had occurred with respect to the naming of parties. We found that the respondent to the appeal is now shown in the NCAT case management system as JAB-AU, not JAB as we thought. This led us to discover the order changing the name of the applicant dated 16 October 2024 made in the consumer claim. This, in turn, had resulted in the name of JAB in the appeal proceedings being amended in the Tribunal's records - as of 23 October 2024 - to JAB-AU. This change, as we understand it, was made administratively in compliance with r 29(1)(b) of the Civil and Administrative Tribunal Rules (NSW) (the NCAT Rules).
[58]
"Background
1. The Appeal Panel is considering its reserved decision in the appeal by Catallyze Pty Ltd (the appellant) against a decision made by the Tribunal, on 15 July 2024 in case number 2023/00371227, that the appellant pay JAB Holdings Pty Ltd the sum of $12,726 (the appeal). The appeal case number is 2024/00268152.
2. The original proceedings were initially brought, as consumer claim by Sean Van Deventer, against the appellant and were commenced on 16 October 2023 (the original proceedings). The name Sean Van Deventer was subsequently amended to JAB Holdings Pty Ltd before the original proceedings were heard.
3. In the appeal the appellant named JAB Holdings Pty Ltd the as respondent.
4. We heard the appeal on 2 December 2012 and reserved our decision. The hearing was conducted on the basis, as disclosed in the relevant appeal documentation, that JAB Holdings Pty Ltd was the respondent to the appeal.
5. In the course of our deliberations, we have become aware that the name of the respondent in the original proceedings has been amended, from JAB Holdings Pty Ltd to JAB Holdings AU Pty Ltd. This occurred following an order to that effect being made in the original proceedings on 16 October 2024, with effect from 23 October 2023 (the amendment order). A copy of the amendment order is attached.
6. Subsequently, but before the appeal hearing, the name of the respondent to the appeal was changed in Tribunal's case management system (CMS) from JAB Holdings Pty Ltd to JAB Holdings AU Pty Ltd.
7. The Appeal Panel was not aware of the amendment and CMS change when the appeal was heard. Those changes have only now come to our attention. We do not have any documentation relating to the application for amendment.
8. Throughout the appeal and the appealed proceedings Sean Van Deventer has represented the respondent.
(b) any person or body (other than the appellant) who was a party to the proceedings before the Tribunal at first instance
[60]
10. It is uncontested in the appeal that :
a. The appealed decision concerned services to be supplied to the respondent by the appellant under a written agreement made on 14 February 2023 between the appellant and 'JAB Holdings' (the agreement). The agreement was signed on behalf of 'JAB Holdings' by Sean Van Deventer, its director.
b. JAB Holdings Pty Ltd is a company incorporated in New Zealand. It has not been registered in Australia as a foreign company.
c. JAB Holdings AU Pty Ltd is a company that was incorporated in Australia on 13 April 2023, some three months after the date of the agreement. Sean Van Deventer is a director.
11. The amendment order gives rise to a number of new issues which we have decided to ask the parties to make submissions about.
Issues
12. Those issues are:
a. Whether the amendment order has effect in the original proceedings so that:
[61]
i. those proceedings were brought in the name of JAB Holdings AU Pty Ltd;
ii. JAB Holdings AU Pty Ltd, not JAB Holdings Pty Ltd, is identified as a party to those proceedings; and,
iii. JAB Holdings AU Pty Ltd is entitled to the benefit of the money order made in those proceedings.
[62]
b. If not, why not?
c. Whether, as a consequence of the amendment order, and by virtue of the operation of rule 29(b), the respondent to the appeal is now JAB Holdings AU Pty Ltd rather than JAB Holdings Pty Ltd. If not, why not?
d. If the respondent is now JAB Holdings AU Pty Ltd, whether the appeal should be allowed and the original proceeding dismissed, as JAB Holdings AU Pty Ltd was not and could not have been a party to the agreement, as it was not incorporated when the agreement was made? If not, why not?
e. Whether the Appeal Panel can determine these issues on the material provided by parties without a hearing?
Orders
13. The appellant is to file and serve any submissions it wishes to make with respect to the issues by close of business on 18 February 2025.
14. The respondent is to file and serve any submissions in reply with respect to the issues by 4 March 2025.
15. The appellant is to file and serve any submissions it wishes to make in response new issues raised in the respondent's reply submissions by 18 March 2025."
[63]
In submissions, Catallyze maintained that the original proceedings were not brought in the name of JAB-AU and that it should not be identified as a party to those proceedings. It maintained that JAB-AU was and is not a party to the appeal proceedings and is not entitled to the benefit of the monetary order. The submissions said:
[64]
"The entity did not exist at the time. We always opposed the Australian company being joined.
It did not exist when the contract was made and services supplied."
[65]
Catallyze supported the appeal being allowed and the original proceedings being dismissed, as JAB-AU did not exist at the time of the contract:
[66]
"We never acknowledged that we had contracted with an Australian entity."
[67]
The submissions from JAB-AU were written by Dr van Deventer. They reflect a difficulty in maintaining necessary distinctions between himself and the companies he controls.
He first took issue with our statement, in the request for submissions, that we were not aware of the change of name to JAB-AU, referring to the miscellaneous matters application he had made. The point we were seeking to make was that the Appeal Panel, as constituted by us, had not been previously aware of the name change having occurred. That miscellaneous application was made in the consumer claim in the Consumer and Commercial Division, not to the Appeal Panel.
With respect to whether the amendment order had any effect in the appeal proceedings (issue 2) he wrote:
[68]
"The name change should have no effect on the appeal proceedings however, the name should be changed to JAB Holding NZ Limited. Both Catallyze and I agree that the contract was between Catallyze and JAB Holding NZ Limited and the name should be changed accordingly."
[69]
Details of the incorporation of JAB-NZ were then provided, including an extract from the New Zealand Companies Register. Dr van Deventer added that JAB-NZ had since changed its name to X-Holdings Limited.
[70]
With respect to who should gain the benefit of the money order it was submitted that JAB-AU is entitled to payment. Dr van Deventer's submission said:
[71]
"I own JAB Holding NZ Limited, and I am the only employee. I also own JAB Holdings AU Pty Ltd , and I am also the only employee. In does not matter to me which name goes on the order as long as I can recover the money I paid Catallyze."
[72]
Dr van Deventer does not seem to understand the incorporated companies are separate legal persons, and not just an extension of himself. In litigation, such as consumer claims, these distinctions are important. If the wrong contracting party is named, the consequences to the success of a claim can be fatal.
[73]
The Tribunal commenced the decision (D) by noting that JAB sought an order that Catallyze pay it an amount in Australian dollars equivalent to NZ$15,000, in respect of a claim that Catallyze breached the contract between the parties dated 14 February 2023. The Tribunal indicated that it regarded this as a claim under s 60 of the Australian Consumer Law (the ACL), which is the consumer guarantee that services will be supplied with due care and skill. The Tribunal said it had jurisdiction to hear such a claim as a consumer claim under the Fair Trading Act 1987 (NSW) (the FT Act). There is no issue about that raised before the Member.
In summarising the evidence before her, the Member relevantly wrote:
[74]
"11 The parties agreed that, on 14 February 2023, the Applicant paid $NZ15,000 to the Respondent for services to be provided under the Contract. The Contract is at p11-20 of Ex R1. The parties agreed that the start date of the provision of services by the Respondent under the Contract was about March 2023 and the end date was about September 2023."
[75]
The contract was concerned with the provision of consultancy services by Catallyze to JAB, concerning the development and financing of a proposed business. It was evidenced in writing, consisting of a cover letter dated 9 January 2023 from Mr Webb of Catallyze to Dr van Deventer of JAB, to which were annexed two schedules:
[76]
(1) Schedule 1 - Terms and Conditions and
(2) Schedule 2 - Initial Engagement.
[77]
The cover letter was signed by Dr van Deventer on 14 February 2023, on behalf of JAB, accepting the terms and conditions. Schedule 2 was signed by both Mr Webb for Catallyze and Dr van Deventer for JAB on the same date.
Rather than quoting the Member's description of sch 2, we think it clearer to set out what it said:
[78]
"SCHEDULE 2 - Initial Engagement
This Engagement is issued pursuant to the Terms between Catalyze (sic) Pty Ltd ACN 651 043 079 ('Catallyze') and JAB Holdings ('Client'). together the parties and each party. Unless otherwise defined in this Engagement, capitalised terms have the meanings given to them in the Terms.
Catailyze (sic) Partner
Richard Webb
2. Scope and output of Commercial Assessment:
[79]
Assess competition, product, and market opportunities.
Assess three financial scenarios (sell today, current plan, accelerated plan)
Recommend a global commercial strategy with forecasted liquidity options
Recommend and secure optimal mix of dilutive and non-dilutive capital sources
Present a detailed recommendation to key stakeholders (100+ page report)
[80]
The above will be summarised in a report to you and determine the appropriateness of proceeding with a plan.
3. Assessment Fee - NZ$5,000 due before commencement of the Assessment, NZ$5,000 due a week after commencement, NZ$5,000 due after presentation delivery
4. Capital Raise Scope
[81]
Catallyze will present a list of interested parties on a regular basis (as agreed by parties preferably weekly once we agree with the action plan following the assessment phase)
The Client will be introduced/copied into any correspondence with prospective customers / investors/ government agencies / asset financiers etc
[82]
Revenues, government grants; and corporate sponsorships 20%
Equity, quasi equity, convertibles, preference shares 5% (based on the value of equity contributed from third parties)
Senior debt/asset financing - banks/non-banks Fee to be determined post the Assessment and subject to the quantum of the raise
[83]
The term of this initial engagement will be one year from the completion of the Assessment. This Engagement will be subject to, governed by, and will incorporate the terms and conditions contained in the Terms. To the extent there is any ambiguity, discrepancy or inconsistency in or between the terms of these Terms and this Engagement, this Engagement will prevail. Each party, upon its acceptance of this Engagement, is bound by, and must comply with, its respective obligations under this Engagement and the Terms."
[84]
In the decision, the Member identified each of the bullet points above by referring to the clause number and then allocating a sub-clause number to each bullet point for the purposes of discussion. Thus, a reference to clause 2.4 is a reference to the fourth bullet point in cl 2 of the schedule. The Member identified the schedule as containing the "key provisions which it was said included service obligations that Catallyze had breached".
The Tribunal spent some time setting out the parties' respective evidence. In issue was whether Catallyze had honoured its obligations under cls 2.4, 4.1 and 4.2 of the schedule, and whether, as a consequence, it had failed to supply its services with due care and skill.
The Tribunal also set out a number of matters said to be agreed between the parties. With respect to the meaning of sch 2 the Tribunal wrote:
[85]
"15 The parties agreed during the second hearing that clause 3 of Schedule 2 of the Contract provided that the total value of the Contract was NZ$15,000 payable by the Applicant to the Respondent plus the further commission amounts payable by the Applicant to the Respondent described in clause 5 (consisting of 20% of government grants and 20% of corporate sponsorships etc).
16 Both parties agreed during the hearing that the value of clauses 2.4, 4.1 and 4.2 together amounted to NZ$14,000, or AU$12,726 (as at 6 May 2024). In other words, both parties agreed that any failure to comply with all three clauses (2.4, 4.1 and 4.2) amounted to NZ$14,000, or AU$12,726 (as at 6 May 2024)."
[86]
Catallyze disputes that it agreed to the content of par [16].
In finding for JAB, the Tribunal found that:
[87]
(1) Catallyze had failed to recommend or secure any capital sources as required by cl 2.4: see D[26]-[27]. The Tribunal rejected Catallyze's explanation that JAB had failed to provide evidence that it was registered in Australia. The Tribunal said:
[88]
"28 The Presiding Member accepts that the Applicant provided the Respondent with evidence that the Applicant was registered in or shortly after the meeting of 17 April 2023. This is plainly recorded in the minutes of the 17 April 2023 meeting (p3, Ex R2). The Respondent says that the 17 April 2023 minutes only acknowledge that the Applicant told the Respondent that the Applicant was registered in Australia but that the Applicant did not provide evidence of this.
29 The Presiding Member does not accept that the Respondent did not have sufficient evidence that the Applicant was registered in Australia. The Applicant's ACN is recorded in 19 meeting minutes between 1 May 2023 and 5 September 2023 (pp5-23 Ex R2). The words 'payment gateway already established' appear under the dot point 'company registered in Australia - JAB Holdings Pty Limited' in every one of the meeting minutes."
[89]
There is now no dispute that JAB Holdings Pty Limited was never "registered" in Australia. JAB-AU was.
[90]
(2) Catallyze had failed to comply with the requirement of cl 4.1 that it present a list of interested parties (interested in being a capital source) on a regular basis: see D[32]. The Tribunal found that those parties that Catallyze did name as being interested were not potential capital sources.
[91]
(3) Catallyze had breached cl 4.2 by failing to copy JAB into correspondence with prospects, and to introduce JAB to those prospects: D[33].
[92]
(4) The Tribunal, at D[35], concluded that these breaches of cls 2.4, 4.1 and 4.2 of sch 2 constituted a failure by Catallyze to supply its services with due care and skill in breach of the consumer guarantee under s 60 of the ACL.
[93]
The Tribunal awarded what it found were reasonably foreseeable damages for a breach of guarantee under s 267 of the ACL. The Tribunal explained:
[94]
"39 In the instant case, it was reasonably foreseeable that the Applicant would suffer the loss of the money that the Applicant paid to the Respondent for compliance with clauses 2.4, 4.1 and 4.2 of Schedule 2 of the Contract, as a result of the Respondent's failure to comply with each of those clauses and therefore with s60 of the ACL. Therefore, damages are recoverable by the Applicant under s267(4) of the ACL in respect of the breach of s60.
40 As stated above, during the second hearing the parties agreed that the value to the Applicant of any non-compliance by the Respondent with clauses 2.4, 4.1 and 4.2 of Schedule 2 of the Contract was NZ$14,000, or AU$12,726 (as at 6 May 2024, being the date of the second hearing)."
[95]
As a result of events that have unfolded since the appeal hearing we consider that the appeal raises questions of law concerning the correct respondent to the appeal. That is, whether r 29(1)(b) operates to make an entity or person who was not a party to the consumer claim, but who has been substituted as a party after the proceedings have been determined, a party to an appeal?
While the appeal formally sought leave to appeal, we considered that it raised two questions of law which were addressed during the appeal hearing. These are:
[96]
(1) Whether the Tribunal was wrong in its construction of sch 2 of the contract with respect to what was to be paid for which services provided by Catallyze.
(2) Whether Catallyze was denied procedural fairness by being denied the opportunity to put its case throughout the hearing.
[97]
Leave to appeal was sought on the basis that the decision was against the weight of the evidence and that it was not fair or equitable because the Tribunal had not given Catallyze a fair opportunity to present its case.
[98]
JAB was named by Catallyze as the respondent to the appeal. JAB is not incorporated as a company in either Australia or New Zealand. It is not capable of being sued. It, therefore, cannot be the correct respondent to Catallyze's appeal.
All the evidence before the Tribunal concerning the formation of the contract, points to that agreement being between a company then operating in New Zealand, which both parties now agree was JAB-NZ, and Catallyze. The contract provided that JAB would pay Catallyze for the provision of consulting services.
At that time, JAB-AU did not exist. It was incorporated later as recommended by Catallyze.
When the consumer claim was heard by the Tribunal in the first half of 2004 JAB-AU had been incorporated. As JAB was not incorporated in Australia, we infer that the company to which the Member was referring when she said she had done a search and had found that "JAB Holdings is registered with ASIC" must have been JAB-AU. The Member did not turn her mind to the date of JAB-AU's incorporation, or consider how it could be a party to a contract made before it was incorporated. That there was evidence before her that pointed to a company being incorporated in Australia after the contract was made, is undoubted. In any case, the Member's order and decision demonstrate that she determined the consumer claim on the basis that JAB was the named respondent, not JAB-AU.
The name was subsequently changed in the consumer claim to JAB-AU. As we have already noted, the order to change the name is not the subject of the appeal proceedings, which were commenced before the amendment order was made.
Apparently in reliance on r 29(1)(b) of the NCAT Rules, the name of the respondent to the appeal, JAB, was then changed to JAB-AU on the basis that it was the body who was a party to the consumer claim, and was therefore a party to the appeal. The difficulty with this is that JAB-AU was not a party to the consumer claim, but an entity substituted as claimant after the Tribunal had issued a decision determining the consumer claim.
We add that if JAB-AU had been the claimant, it could not have succeeded in the consumer claim because it was not a party to the contract in issue, and had not been incorporated when the contract was made. This alone demonstrates that it could not properly have been a party to the consumer claim.
[99]
In this case it is clear that the parties reduced their agreement to writing. That writing consisted of the cover letter and its two schedules. The contract is to be read as whole.
In this regard we note that the cover letter said:
[100]
"Catallyze will provide the services of a consultant. The Services will be those items set out in Schedule 2 (or any subsequent Engagement agreed between the parties) (Services).
The duties and responsibilities of Catallyze under the Terms shall not include giving tax , legal, accountancy or other specialist advice and services."
[101]
"Fees
Catallyze will provide the Services in accordance with the fee set out in Schedule 2 ...
Payment Terms
Catallyze will invoice the Client the fee, and the Client agrees to pay the fee, in the manner set out in Schedule 2 ..."
[102]
Schedule 1 contains terms and conditions which do not add to the provisions already referred to relating to the scope of work under the contract or the agreed fee.
In Mount Bruce Mining Pty Limited v Wright Prospecting Pty Limited(2015) 256 CLR 104; [2015] HCA 37, French CJ, Nettle and Gordon JJ stated at [46] and [50]:
[103]
"[46] The rights and liabilities of parties under a provision of a contract are determined objectively, by reference to its text, context (the entire text of the contract as well as any contract, document or statutory provision referred to in the text of the contract) and purpose.
...
[50] Each of the events, circumstances and things external to the contract to which recourse may be had is objective. What may be referred to are events, circumstances and things external to the contract which are known to the parties or which assist in identifying the purpose or object of the transaction, which may include its history, background and context and the market in which the parties were operating. What is inadmissible is evidence of the parties' statements and actions reflecting their actual intentions and expectations."
[104]
The rule, as to what is inadmissible evidence in the construction of contracts, is known as the parol evidence rule. In Codelfa Construction Pty Ltd v State Rail Authority of New South Wales(1982) 149 CLR 337 at 347-8; [1982] HCA 24; Mason J (with whom Stephen and Wilson JJ agreed) explained that:
[105]
"The broad purpose of the parol evidence rule is to exclude extrinsic evidence (except as to surrounding circumstances), including direct statements of intention (except in cases of latent ambiguity) and antecedent negotiations, to subtract from, add to, vary or contradict the language of a written instrument (Goss v Lord Nugent [1833] EngR 618; (1833) 5 B & Ad 58 at 64-5; [1833] EngR 618; 110 ER 713 at 716). Although the traditional expositions of the rule did not in terms deny resort to extrinsic evidence for the purpose of interpreting the written instrument, it has often been regarded as prohibiting the use of extrinsic evidence for this purpose. No doubt this was due to the theory which came to prevail in English legal thinking in the first half of this century that the words of a contract are ordinarily to be given their plain and ordinary meaning. Recourse to extrinsic evidence is then superfluous. At best it confirms what has been definitely established by other means; at worst it tends ineffectively to modify what has been so established.
On the other hand, it has frequently been acknowledged that there is more to the construction of the words of written instruments than merely assigning to them their plain and ordinary meaning - see, for example, the remarks of Knox CJ in Life Insurance Co of Australia Ltd v Phillips [1925] HCA 18; (1925) 36 CLR 60 at 69. This has led to a recognition that evidence of surrounding circumstances is admissible in aid of the construction of a contract. So Lord Wilberforce in Schuler L A G v Wickman Machine Tool Sales Ltd [1973] UKHL 2; at 53; ; at 261, was able to state the broad thrust of the rule in this way:
[106]
'The general rule is that extrinsic evidence is not admissible for the construction of a written contract; the parties' intentions must be ascertained, on legal principles of construction, from the words they have used. It is one and the same principle which excludes evidence of statements, or actions, during negotiations, at the time of the contract, or subsequent to the contract, any of which to the lay mind might at first sight seem to be proper to receive.'
[107]
His Lordship noted that evidence of surrounding circumstances is an exception to the rule, but he had no occasion to discuss its scope for there it was not, as it is here, a critical question.
...
The true rule is that evidence of surrounding circumstances is admissible to assist in the interpretation of the contract if the language is ambiguous or susceptible of more than one meaning. But it is not admissible to contradict the language of the contract when it has a plain meaning. ..."
[108]
It is not clear to us how the Member went about construing the contract. Her conclusions, said to be based on the parties' agreement, that "the value to the Applicant of any non-compliance by the Respondent with clauses 2.4, 4.1 and 4.2 of Schedule 2 of the Contract was NZ$14,000 AU$12,726 (as at 6 May 2024, being the date of the second hearing)" does not accord with the plain meaning of sch 2. In the decision, the Tribunal did not interpret the contract objectively. We have concluded that in construing the contract the Tribunal did not determine the rights and liabilities of the parties by having regard to the text, context and purpose of the contract.
A plain reading of the contractual documents reveals that purpose of the contract was the provision of Catallyze's consultancy services to JAB regarding the development and financing of JAB's proposed business. Schedule 2 provided for Catallyze's consultancy services to be of two types. First, an initial assessment and plan, which if appropriate, would be followed by the provisions to JAB of contacts with, and introductions to, persons Catallyze thought useful to the development of the proposed business, including the provision of capital.
The initial assessment required Catallyze to assess the proposal and to make recommendations about the specific topics as set out in cls 2.1. to 2.4 of sch 2. The results were to be summarised in a report to JAB "and [would] determine the appropriateness of proceeding with a plan": cl 2.5. For undertaking the assessment, JAB was to pay Catallyze the "assessment fee" of NZ$15,000, in the three instalments stipulated in cl 3.
Clause 4 is headed "Capital Raise Scope", indicating a focus of its provisions being on raising funds for the proposed business. It follows JAB receiving the initial assessment and proceeding with a plan. This is consistent with the first sentence in the last paragraph of sch 2 which provides that "The term of this initial engagement will be one year from the completion of the Assessment." This reinforces the staged nature of the services, consisting of the provision of an assessment report followed by a year of consultancy services relating to the development and financing of the business.
Clause 4.1 concerns the provision of contacts with, and introductions to, persons useful to the development of the proposed business. It required Catallyze to provide a list of interested parties to JAB on a regular basis. Clause 4.2 required that JAB be copied into relevant correspondence with and introduced to interested parties and prospective contacts. Clause 5 provided for Capital Raise Commissions - at varying rates depending on the type of financing involved - which were to be paid to Catallyze. From the purpose, text and context of the contract we conclude that these commissions would have been payable when the finance concerned was actually received by JAB, although the agreement is silent on the issue. This makes commercial sense.
[109]
Was Catallyze denied procedural fairness in the hearing?
[110]
Catallyze submitted that it was denied procedural fairness by not being allowed to put its case properly or fully. Mr Webb asserted that he had been constantly interrupted by the Tribunal Member, stopped from saying what he wanted to say and from mounting arguments on which Catallyze relied. He claimed he had been denied the opportunity to give oral evidence. He denied he had made any of the concessions referred to in the Tribunal's decision. He said that the repeated interjections and redirections by the Tribunal deprived Catallyze of a fair hearing. The Member pressed him for concessions while not listening to what he had to say. Catallyze did not allege bias on the Member's part, either apprehended or actual, but complained about the fairness of the Tribunal's process.
Catallyze produced a number of transcript like excerpts, it had made from the audio recording of the hearing, which showed the Member adopting a directive manner during the hearing. Some relate to the Member trying to get Mr Webb to address what she considered a matter of relevance, while he sought to address something else. This is not a novel situation.
Dr van Deventer disputed that Catallyze was denied procedural fairness, saying that Catallyze was given a fair opportunity to be heard. He also produced a transcript like excerpt from the hearing in which there is an interchange between Mr Webb and the Member, in which Mr Webb is putting part of his case without constant interruption by the Member.
We have not been provided with a full transcript of the hearing. We are wary of relying on the competing, and self-supporting, excerpts provided by the parties. We think it clear from all the excerpts that Mr Webb did give evidence to the Tribunal.
Interventions in the presentation of a party's case by the Tribunal may be made "in legitimate pursuit of identifying and elucidating the real issues in dispute amongst a morass of material that was not well organised and did not clearly distinguish evidence from commentary on evidence": Singh v Ellis[2025] NSWCATAP 21 at [54].
Due to the conflicting evidence regarding how the hearing was conducted, we are not persuaded that Catallyze was denied procedural fairness. We are not persuaded that the Tribunal's interventions went beyond those aimed at clarifying and exploring the issues in dispute. We acknowledge that interventions such as those disclosed in the excerpts provided by Catallyze, while done in pursuit of a legitimate purpose, can lead to understandable frustration for people unfamiliar with the Tribunal environment seeking to put their case. Unfortunately, in an environment such as the Tribunal, where the guiding principle is to "facilitate the just, quick and cheap resolution of the real issues in the proceedings", as required by s 36(1) of the NCAT Act, such interventions are often necessary.
[111]
We have already found that the consumer claim needs to be redetermined in the light of the Tribunal's errors of law in the construction of the contract. Such a rehearing can take place by remitting the proceeding to be reheard in the Consumer and Commercial Division, or by the Appeal Panel reconsidering the matter with or without fresh evidence. The parties were aware of these possibilities both before and during the appeal hearing.
In compliance with the guiding principle of the Tribunal in s 36(1), we think that a just, quick and cheap resolution of JAB's claim will be fairly obtained by the Appeal Panel reconsidering the consumer claim, on the evidence that was before the Tribunal, taking into account the parties submissions on appeal.
In doing so, we will consider the following issues that arise:
[112]
(1) Who is the proper applicant in the consumer claim?
(2) Does the Tribunal have jurisdiction to hear the consumer claim?
(3) The proper construction of the contract between the parties?
(4) Whether Catallyze has breached any and what provisions of the contract?
(5) Whether those breaches demonstrate a breach of the consumer guarantee to provide services with due care and skill?
(6) If so, what damages is JAB entitled to?
[113]
Who is the proper applicant in the consumer claim?
[114]
We have already explained the significant history and confusion that has resulted from the incorrect naming of the applicant as JAB.
It is clear on the evidence that was before the Tribunal that the proper respondent was a New Zealand based company the parties knew as JAB. It is also clear on the evidence that was before the Tribunal that the respondent could not be the company registered in Australia, as it did not exist at the time the contract was made. As a result, it could not be a party to the contract.
Both parties agree that when JAB was named as a party in place of Dr van Deventer, that was a misnomer. The actual name of the company that was a party to the contract was JAB-NZ. Dr van Deventer in submissions to the Appeal Panel, has asked that the name be corrected. This accords with Catallyze's submissions.
While the name was amended after the decision was made to JAB-AU, that order does not prevent us from further amending the name when reconsidering the consumer claim on appeal. On reconsideration, we will amend the name of the applicant in the consumer claim to JAB Holdings New Zealand Limited (JAB-NZ).
[115]
Does the Tribunal have jurisdiction to consider the consumer claim?
[116]
At pars [6]-[10] of the decision the Tribunal member explained why the Tribunal had jurisdiction. It did so on the basis that JAB was a company registered in Australia. We can see no error in the Tribunal's analysis of its jurisdiction on that basis.
Because we have found that the proper respondent to the consumer claim is JAB-NZ - a company not incorporated in Australia - it is necessary for us to revisit the issue of jurisdiction, as there is an issue as to whether a foreign company can bring a consumer claim. The issue of how a New Zealand company can bring a consumer claim was canvassed in the appeal hearing, because we were proceeding on the (ultimately correct) basis that JAB was a New Zealand company.
In order to apply to the Tribunal to determine a consumer claim under s 79I of the FT Act, the application must be made by a consumer as relevantly defined in s 79D:
[117]
consumer means any of the following persons or bodies to whom or to which a supplier has supplied, or agreed to supply, goods or services (whether or not under a contract), or with whom or with which a supplier has entered into a contract that is collateral to a contract for the supply of goods or services -
(c) a small proprietary company (within the meaning of the Corporations Act 2001 of the Commonwealth),
(d) ...
(h) a company limited by guarantee (other than a company limited both by shares and by guarantee).
[118]
In this case an issue arises as to whether JAB-NZ is a small proprietary company with the meaning par (c) of the definition. A small proprietary company is defined in ss 9 and 45A of the Corporations Law as being a proprietary company that satisfies a combination of requirements that address the amount of its revenue, its assets and the number of employees it has: s 45A(2). It must be a proprietary company, "that is registered as, or converts to, a proprietary company under this Act" (s 45A(1)) and will be a small proprietary company if it satisfied the requirements.
JAB-NZ is not registered as a proprietary company under the Corporations Law. It cannot be a small proprietary company. It is therefore not a consumer within the meaning of the definition of consumer in s 79D. See also, but in a different context, In the matter of Featherston Resources Limited; Tetley v Weston[2014] NSWSC 1139 per Brereton J at [19]. Prima facie the Tribunal does not have jurisdiction to hear a consumer claim brought by it as it is not a small proprietary company.
However, s 79H of the FT Act provides:
[119]
For the purposes of this Part -
(a) a person or body claiming to be a consumer is to be presumed to be a consumer until the contrary is proved, and
(b) in any legal proceedings (including proceedings before the Tribunal), the onus of proving that a person or body claiming to be a consumer is not a consumer is on the party who seeks to establish that fact.
[120]
Therefore, in the proceedings below, and before us on reconsideration, JAB is presumed to be a consumer unless the contrary is proved. While the issue of whether or not JAB was registered in Australia was clearly raised before the Tribunal, the issue of whether it was a consumer was not. In those circumstances the Tribunal was entitled to presume that JAB was a consumer.
On reconsideration, however, there is clear evidence before us which demonstrates that JAB-NZ is not a small proprietary company within the meaning of the definition of "consumer" in s 79D of the FTA. Consequently, the claim cannot be brought as a consumer claim before the Tribunal under s 79E. In saying that, we acknowledge that the issue of jurisdiction was not raised by Catallyze on appeal but arose as a result of our deliberations.
On reconsideration, therefore, we find that the Tribunal does not have jurisdiction to hear and determine the claim made by JAB-NZ as a consumer claim because JAB-NZ is not a consumer as defined in s79D.
In the event we are wrong about that, we shall proceed to consider the merits of JAB-NZ's claim, as if it were a consumer claim in accordance with the caution stated in Kuruv State of New South Wales[2008] HCA 26 at [12]:
[121]
12. The appeal to this Court should be allowed. ...The matter must be remitted to the Court of Appeal for consideration of the outstanding issues about damages. That outcome means that this Court cannot make orders disposing finally of the dispute between the parties. This Court has said on a number of occasions that, although there can be no universal rule, it is important for intermediate courts of appeal to consider whether to deal with all grounds of appeal, not just with what is identified as the decisive ground. If the intermediate court has dealt with all grounds argued and an appeal to this Court succeeds, this Court will be able to consider all the issues between the parties and will not have to remit the matter to the intermediate court for consideration of grounds of appeal not dealt with below.
[122]
Whether Catallyze has breached any and what provisions of the contract?
[123]
We have already indicated what we consider to be the proper construction of the contract. Our reconsideration of the claim will be based on that construction.
In finding that Catallyze had breached cl 2.4 the contract, which required it to "recommend and secure [an] optimal mix of dilutive and non-dilutive capital sources" by failing to recommend any viable capital sources, the Tribunal rejected Catallyze's assertion that JAB had not provided evidence that JAB-AU was registered in Australia. Without registration, Catallyze submitted it was impossible to find capital sources.
The regular minutes of meetings between the parties record that from 17 April 2023 onward JAB-AU was registered in Australia. The Tribunal rejected Catallyze's explanation of its inability to find capital sources as required by cl 2.4 on the basis of these minutes. However, the assessment produced by Catallyze under the contract is dated 6 March 2023, more than a month before Catallyze was notified that JAB-AU had been registered in Australia. In those circumstances, we are unable to reach the same conclusion as that reached by the Tribunal.
We think that the explanation advanced by Catallyze for its inability to find capital sources to be included in its assessment report is convincing and accords with commercial reality. Until there was a vehicle (company) registered in Australia to advance the business plan here, the difficulties faced in obtaining capital sources were obvious.
While the Tribunal found that the capital sources mentioned in the assessment report were not viable, we agree with Catallyze that, without details of an Australian registered company, providing viable capital sources to back the business was not possible.
On our construction of the contract, once the assessment was provided and accepted - which from the material before us must have occurred at some time before the first regular meeting was held to address the requirements of cl 4.1 of sch 2 on 17 April 2023 - Catallyze was entitled to the final payment of $5,000 towards its assessment fee of $15,000 in accordance with cl 3 of sch 2. The first two payments should already have been made.
We do not understand, and JAB-NZ has not explained why, having been provided with and accepted the assessment report, JAB-NZ can now claim a refund of the $15,000 it paid Catallyze in accordance with cl 3 of sch 2. The payment of that amount to Catallyze is evidence that JAB-NZ was satisfied with the services Catallyze provided, in what we have called the first stage of the contract, and that the contract had proceeded from there.
[124]
We do not agree with the Tribunal that the NZ $15,000 was paid to Catallyze in "compliance with clauses 2.4. 4.1 and 4.2". Rather, it was paid with respect to its provision of an assessment report in accordance with cl 2.4, which report was accepted at the time. Catallyze was entitled to that payment under the terms of the contract, and, in the circumstances, it had not breached cl 2.4.
The Tribunal considered and assessed damages under s 267(4) of the ACL. Given that breach of consumer guarantee was not said or found to be a major failure, we agree that this was the applicable provision. It is a provision that allows for the recovery of consequential loss. In Capic v Ford Motor Company of Australia Pty Ltd[2021] FCA 715 at [891] Perram J cited Moore v Scenic Tours Pty Ltd(2020) 268 CLR 326; [2020] HCA 17, where the High Court explained that:
[125]
"[64] Where contract damages provide compensation directly based on the performance interest, that component of the award is not concerned with loss in any real or factual sense. The compensation for the performance interest, 'by the value of the promised performance', appears 'as a "loss" only by reference to an unstated ought'. The aim of this component of the award is to provide the promisee with the difference between the value of what was promised and the value of what was received. The promisee had a primary right to performance of the contract so, upon termination, the law generally provides for a secondary right for the value of the performance that was not received or the difference in value due to the defect.
[65] This component of compensation is contained in s 267(3) of the Australian Consumer Law, where a consumer may 'recover compensation for any reduction in the value of the services below the price paid or payable by the consumer for the services'. ...
[66] A promisee might also suffer true, consequential, loss from a breach of contract. These consequential losses might include economic (financial) losses to the promisee to the extent that they go beyond the value of the promised performance and are within the boundaries of legal responsibility. They can also include some non-economic losses.
[67] This component of consequential loss is contained in s 267(4) of the Australian Consumer Law, a head of damages additional to s 267(3), which allows for recovery of further loss or damage for a relevant failure to comply with a guarantee as provided in s 267(1) 'if it was reasonably foreseeable that the consumer would suffer such loss or damage as a result of such a failure'. ..."
[126]
See also Au v B & L Booth Pty Ltd trading as Creative by Design[2024] NSWCATAP 208 at [71] and following.
[127]
There is no suggestion that JAB-NZ or JAB-AU received any funding as a result of any introduction made by Catallyze, or that Catallyze charged or received any commissions under cl 5 of sch 2, in relation to an introduction under cl 4. There is no evidence that demonstrates that the proposed business could have (or has) obtained funding elsewhere, or that there were reasonable prospects of gaining funding or sponsorship for the business. Indeed, there was evidence before the Tribunal below that JAB-AU was being deregistered.
We do not agree with the Tribunal's conclusion at D[30] that, "it was reasonably foreseeable that the Applicant would suffer the loss of the money that the Applicant paid to the Respondent for compliance with cls 2.4, 4.1 and 4.2 of Schedule 2 of the Contract, as a result of the Respondent's failure to comply with each of those clauses and therefore with s60 of the ACL." This is so because:
[128]
(1) The payment of the NZ$15,000 assessment fee was required by cl 3 and related to Catallyze's obligations under cl 2. These were fulfilled and the assessment report accepted by JAB-NZ.
(2) While the breaches of cls 4.1 and 4.2 give rise to a right to claim reasonably foreseeable damages for breach of the consumer guarantee, the measure of damages is not the amount paid for the assessment report, which JAB-NZ had the benefit of.
(3) Any consequential loss it suffered is a matter to be proved by JAB-NZ. Section 267(4) of the ACL does not provide a basis for demanding a refund of all money paid under the contract. In certain circumstances, where a major failure has been demonstrated under s 268, there may be an entitlement to a refund of money paid under a contract, but that is not the situation where damages are sought under s 276(4).
[129]
In reality, there is no evidence of the reasonably foreseeable loss suffered by JAB-NZ as a result of the failure to comply with the guarantee. Whether or not such a loss was suffered is entirely speculative.
This means that on reconsideration of JAB-NZ's claim, on the assumption that it is a consumer claim, we are not satisfied that it suffered any reasonably foreseeable loss or damage as a result of Catallyze breaching the consumer guarantee with respect to cl 4 of sch 2 of the contract.
[130]
What orders should be made to dispose of on appeal?
[131]
In the light of the above we will allow the appeal and on reconsideration make an order setting aside the Tribunal's order of 15 July 2023. In its place we will make orders:
[132]
(1) Amending the name of the applicant in consumer claim 2023/00371227 to JAB Holdings New Zealand Limited.
(2) Dismissing the claim for want of jurisdiction.
[133]
Those orders reflect a fair and equitable outcome considering all the circumstances of the case.
We note that there is no application with respect to the costs of the appeal and that, like the proceedings below, s 60 of the NCAT Act applies to require the parties to bear their own costs of the proceedings, unless there are special circumstances warranting a departure from that course. We also note that the parties were not legally represented, which would severely limit any costs they could claim if costs were in issue. We can see no special circumstances and propose not to make a costs order.
[134]
The Appeal Panel makes the following orders:
The name of the respondent to the appeal is amended to JAB Holdings New Zealand Limited.
Appeal allowed.
The orders made by the Tribunal on 15 July 2023 in matter number 2023/00371227 are set aside and substituted with the following orders:
[135]
(a) The name of the applicant is amended to JAB Holdings New Zealand Limited.
(b) Claim dismissed for want of jurisdiction.
[136]
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.
Parties
Applicant/Plaintiff:
Catallyze Pty Ltd
Respondent/Defendant:
JAB Holdings New Zealand Limited [2025] NSWCATAP 140
(6) A failure to provide adequate reasons for decision.
5. However, such a change may be used to suggest that the current stay order only applies to JAB Holdings Pty Ltd and not to JAB Holdings AU Pty Ltd. For that reason, the appropriate course appears to be to (1) make an order for a change in the name of the applicant in the first instance proceedings, but (2) suspend to operation of that order until the conclusion of the hearing of the application to lift that stay order on 23 October 2024.
6. As there is no utility in conducting a hearing in relation to this issue, an order dispensing with any such hearing is warranted."
2014
Having noted all of this, we wrote to the parties giving notice of what we had found and seeking their submission in the following terms:
In our view, r 29(1)(b) does not operate to make an entity substituted for a party to a consumer claim, after those proceedings have been determined, a party to an appeal. Such an order, properly made, will have effect in the consumer claim, but not in appeal proceedings. Only parties who were truly parties to a consumer claim, are parties to an appeal by operation of the rule. This accords with its plain and ordinary meaning.
When a person or entity, who was not a party in the consumer claim, wishes to be a made party to an appeal - for example on the basis that they ought properly to have been a party - they may make an application to be made a party to the appeal under r 29(1)(c) of the NCAT Rules, in accordance with s 44 of the NCAT Act.
It follows that the JAB-AU is not a party to the appeal.
The notice of appeal named JAB as respondent. JAB is not incorporated. As will emerge from the discussion below it is apparent, as now agreed by both parties, that the contract which is the subject of the consumer claim is properly between JAB-NZ, a company incorporated in New Zealand, and Catallyze.
As a result, we will amend the name of respondent to the appeal to JAB Holdings NZ Limited.
Objectively construed the contract does not operate in the manner found by the Tribunal.
For all of these reasons we are satisfied that the Tribunal erred in its construction of the contract between the parties. That is an error of law.
Of particular concern, is the fact that the Tribunal determined the proceedings on the basis that the $15,000 payment related to both stages of the contract and made its determination accordingly. The $15,000 payment was for the initial assessment only. Catallyze's fees for the capital raising stage were to be paid for by commission calculated in accordance with cl 5 of sch 2.
As a result of these errors the consumer claim will have to be redetermined.
We do not accept that Catallyze was denied procedural fairness.
For the same reasons, we would not grant leave to Catallyze to appeal on the ground that it may have suffered a substantial miscarriage of justice because the decision was not fair and equitable or against the weight of the evidence. We do not accept that Catallyze has suffered a substantial miscarriage of justice on those grounds, or that the decision is one which raises concerns about the unorthodoxy of the Tribunal's approach, an issue of principle or a matter of public importance.
We are not satisfied that Catallyze failed to exercise due care and skill in its performance of its obligations with respect to the delivery of the assessment report under the contract. There is no breach of s 60 of the ACL in this regard.
All of the remaining complaints by JAB-NZ relate to the performance by Catallyze of its obligations under cl 4, the Capital Raise Scope. At their heart they go to JAB-NZ not being introduced to interested parties and prospective contacts. The Tribunal found that the lists of interested parties provided by Catallyze did not contain funding sources and that there were no introductions.
On reconsideration, we can see no reason to displace the findings of the Tribunal with respect to Catallyze's breaches of cls 4.1 and 4.2. While Catallyze takes issue with them, there is clearly evidence that justifies the Tribunal's conclusions. We accept that these constitute a breach of the consumer guarantee in s 60 of the ACL and that Catallyze failed to exercise due care and skill with respect to its obligations under cl 4. The Tribunal did not find, and it was not put to us, that this failure was a major failure for the purposes of s 268 of the ACL.