Design 2 Manufacture Pty Ltd v Anglicas

Aboss v Hafeez [2022] NSWCATAP 345

Al-Daouk v Mr Pine Pty Ltd t/as Furnco Bankstown [2015] NSWCATAP 111

Alexandria Landfill Pty Ltd v Transport for NSW (2020) 103 NSWLR 479; [2020] NSWCA 165

Australian Competition and Consumer Commission v Valve Corp (No 3) [2016] FCA 196; 337 ALR 647

Bimson, Roads & Maritime Services v Damorange Pty Ltd [2014] NSWSC 734

Coliban Heights Pty Ltd v Citisolar Vic Pty Ltd [2018] VSCA 191

Collins v Urban [2014] NSWCATAP 17

Cominos v Di Rico [2016] NSWCATAP 5

Dranichnikov v Minister for Immigration and Migration Affairs [2003] HCA 26; 77 ALJR 1088

Frediani v Hall t/as Happy Camper Conversions [2024] NSWCATAP 134

Moore v Scenic Tours Pty Ltd (No 2) [2017] NSWSC 733

Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69

The Owners - Strata Plan No. 12185 v Brown [2025] NSWCATAP 51

Unique Commercial Group Pty Ltd v Cusumano [2024] NSWCATAP 204

Wilson v Winnicott [2021] NSWCATAP 211

1. The appellant ("Design") is a supplier of inclinator systems and equipment.
2. The respondent ("Mr Anglicas") is the owner of two adjacent properties at Church Point in New South Wales.
3. Mr Anglicas undertook the construction of two residences on his properties and, in the course of doing so, constructed two inclinators, which he utilised for lifting building supplies to the building sites. Subsequently, Mr Anglicas sought to convert the inclinators to be suitable for passenger use.
4. Mr Anglicas obtained two quotations from Design, dated 8 February 2022 and 19 December 2022.
5. The 8 February 2022 quotation included four items, described as:

"Supply and install new soft start/stop electrical control system - Inclinator Services - Maintenance & Retrofits"

"Supply and install new car speed governor - Inclinator Services - Maintenance & Retrofits"

"Supply and install new rope slack system - Inclinator Services - Maintenance & Retrofits" and

"Supply and install new cage - Inclinator Services - Maintenance & Retrofits".

1. The quotation contained a description of the physical elements included in each of those items and a price for each item.
2. The 19 December 2022 quotation included the first three items but did not include the supply and installation of a new cage. The description of the work involved in the first and third items (soft stop/start electrical control system and rope slack system) remained the same, as did the price for those items. The second item, "new car speed governor" involved a different scope of work at less than half the price. The total of the two quotations was $54,571, including GST.
3. Mr Anglicas accepted the two quotations, although it is apparent that the first quotation was only accepted in part, as Design did not install a new cage on either inclinator. Design undertook works to the inclinators during 2022 and 2023. Mr Anglicas paid Design's invoices totalling $44,946.
4. Mr Anglicas commenced proceedings on 19 August 2024 seeking $100,000 from Design on the basis that "supply and installation of 2 inclinators is substandard & not complete". sdddddddddAt the hearing of the application, which took place on 13 January 2025, Mr Anglicas sought compensation in the amount of $75,846, being "a refund for the defective work on the conversion of the two inclinators, together with the costs incurred by the applicant in repairing, removing and replacing various parts on each inclinator". Mr Anglicas also sought an unspecified sum for consequential losses alleged to arise from a tenant terminating a lease early and an abortive attempt at sale of one of the residences, both of which occurrences were said to be a consequence of the faulty inclinators.
5. The Tribunal delivered its decision on 28 January 2025.

1. The Tribunal ordered Design to pay Mr Anglicas the sum of $54,548.
2. The Tribunal identified the issues between the parties as follows:

"29 Following completion of the residences, the applicant [ie Mr Anglicas] submits that they had requested the respondent [ie Design] to provide a quotation for the updating of the inclinators so that they would be suitable and approved for carrying people, and be in compliance with the Australian standard for inclined lifts (AS1735.8). The applicant submits that the respondent had inspected the site, the condition and suitability of the rails, winch motor, gearbox and other items, before providing a quotation for each inclinator.

30 The parties' agreement with respect to the works to be completed in converting the inclinators is evidenced by two quotations issued by the respondent. The first quotation is dated 8 February 2022, and the second quotation is dated 19 December 2022.

31 The applicant contends that following the work undertaken by the respondent, the inclinators do not work satisfactorily and are faulty and defective. The applicant submissions with respect to the issues that they had identified may be summarised as follows:

• neither inclinator has been satisfactorily completed - the respondent had manufactured and supplied plant which has not been verified, tested or registered with Safe Work NSW

• both inclinators have broken down and required repairs approximately 43 times

• the inclinator carriage has crashed into the top and bottom concrete station five times while people were riding on the inclinator

• there is no slack rope mechanism on the carriages as required by the Australian Standard, and if the rope breaks, the carriage will speed up until the overspeed actuates the emergency break

• the power to the carriage is 'live', which has resulted in the shorting of the charging station and caused the batteries to the inclinator to become flat

• the stop switch and the slow down gradually switch do not always work, and has resulted in the carriage crashing at speed

• the brakes for the inclinators have not been tested and appears to rely on thin weak springs

• the self-levelling actuator is too slow and results in the carriage being out of level more than the standard 10 degrees

• the speed governor has not been tested, and although it is installed, it is not covered, which allows contamination to easily enter the mechanism resulting in it being jammed and not operating the brake in an emergency

• the computer control board on one of the inclinators had shorted out and had to be replaced

• no wiring diagram has been supplied as required under the Australian Standard

• the inclinator cannot be used as the respondent has refused to verify the design of their components

• the respondent has refused to service, maintain, complete or rectify their defective work."

1. Design's submissions in response were summarised by the Tribunal as follows:

"36 The respondent submits that they did not design, manufacture or install the inclinators. More specifically, the respondent contends that they did not undertake the following works on the inclinators:

• design the machines

• dig the footings

• pour concrete or install the reinforcement for the footings

• supply the steel for the rail or the columns

• install the rail

• manufacture the car

• install the car

• manufacture the cage.

37 The respondent submits that the items that they identified as set out above at [36] comprise the main components of the inclinators and it did not supply or install any of these items. Instead, the respondent contends that these items of work were undertaken by the applicant, and that it had only supplied items as described in Appendix B of Exhibit 2, namely the installation of the following items:

• Variable Speed Drive (VSD) Electrical Control System

• Winch Rope Slack Mechanism

• Wedge Socket Rope Connection

• Safety Overspeed Governor and Wedge Style Brake

• Platform Self-Levelling System.

38 The respondent also submits that when it supplied these items to the applicant, although it intended to comply with the relevant Australian Standard, none of its quotations provided to the applicant specifically state that they would comply with AS1735.8.

39 The respondent further submits that it had never supplied a quote to have their retrofitted items verified for SafeWork registration, and that it was unable to do so as SafeWork has stipulated that the designer and design verifier must not be the same person. However, the respondent provided the applicant with a Design Compliance Certificate to assist the applicant so that they could give it to their verifier for the purpose of the verification process. The respondent explained that the Design Compliance Certificate was issued after it had completed the quoted work and was not part of their quotations. The respondent submits that it had also provided the applicant with detailed layout drawings to assist the verification process which the applicant has not paid for.

40 The respondent contends that the performance issues and warranty repair works were always addressed and many of the warranty repairs were caused by the poor installation and manufacture of inclinators by the applicant, rather than the work that was supplied by the respondent."

1. The Tribunal proceeded on the basis that the contract between the parties was a contract for the supply of services and that Mr Anglicas' claim was for compensation for breach of the consumer guarantee of fitness for purpose provided by s 61 of the Australian Consumer Law (NSW) (ACL).
2. Section 61 of the ACL provides:

61 Guarantees as to fitness for a particular purpose etc.

(1) If:

(a) a person (the supplier) supplies, in trade or commerce, services to a consumer; and

(b) the consumer, expressly or by implication, makes known to the supplier any particular purpose for which the services are being acquired by the consumer;

there is a guarantee that the services, and any product resulting from the services, will be reasonably fit for that purpose.

(2) If:

(a) a person (the supplier) supplies, in trade or commerce, services to a consumer; and

(b) the consumer makes known, expressly or by implication, to:

(i) the supplier; or

(ii) a person by whom any prior negotiations or arrangements in relation to the acquisition of the services were conducted or made;

the result that the consumer wishes the services to achieve;

there is a guarantee that the services, and any product resulting from the services, will be of such a nature, and quality, state or condition, that they might reasonably be expected to achieve that result.

(3) This section does not apply if the circumstances show that the consumer did not rely on, or that it was unreasonable for the consumer to rely on, the skill or judgment of the supplier.

(4) This section does not apply to a supply of services of a professional nature by a qualified architect or engineer.

1. The Tribunal identified the issues for determination as follows:

"(1) whether the respondent failed to comply with consumer guarantees as to fitness for a particular purpose as set out in s 61 of the ACL

(2) if so, whether the failure was a major failure under s 268 of the ACL, and

(3) whether the applicant is entitled to a remedy."

1. The Tribunal referred to the evidence, in particular a report, upon which Mr Anglicas relied, from CMG Elevator Management Pty Ltd, dated 15 October 2024, which identified that the inclinators did not comply with Australian Standard AS 1735.8 (governing inclined lifts) and identified 13 areas where the inclinators were not compliant. Design did not rely upon any expert evidence.
2. The Tribunal referred to the decision of Garling J in Moore v Scenic Tours Pty Ltd (No 2) [2017] NSWSC 733 at [391]- [396] and stated:

"47 Accordingly, for the guarantee contained in s 61(1) of the ACL to apply, the applicant must first establish that they had made known to the respondent, either expressly or implicitly, the purpose for which they were seeking the services. If the respondent subsequently supplies the services to the applicant, then s 61 of the ACL imposes a guarantee that the services supplied will be reasonably fit for that purpose."

"48 Based on my consideration of the evidence and the circumstances, I am satisfied that the applicant has established that, at the time that they contracted with the respondent, the applicant had implicitly made known to the respondent that they wanted the goods inclinators to be converted into passenger inclinators that would safely and reliably transport passengers. Having regard to the nature of the core services provided by the respondent, it was not, in my view, unreasonable for the applicant to rely on the skills and judgment of the respondent to achieve this purpose (s 61(3) of the ACL). Accordingly, I am satisfied that the guarantee in s 61(1) of the ACL has been invoked."

1. The Tribunal rejected Design's submission that the problems were not its responsibility, holding:

"50 Although the respondent claims that many of the problems were caused by the applicant's own installation of the inclinators and the supporting structure, it is unclear why those issues were not identified by the respondent at the time the inclinators were being converted into passenger inclinators and brought to the applicant's attention prior to the conversion works by the respondent. Similarly, it is unclear why the respondent would agree to continue undertaking repairs on the inclinators under warranty if the defects were predominantly caused by the purported poor manufacture and installation of the inclinators by the applicant rather than the work that was undertaken by the respondent."

1. The Tribunal referred to a number of items in the evidence which it considered were inconsistent with Design's submission that the problems with the inclinators were attributable to the work carried out by Mr Anglicas rather than deficiencies in Design's own work.
2. The Tribunal held:

"56 Based on the evidence before me and for the reasons set out above, I am satisfied that the work undertaken by the respondent to convert the inclinators to enable the transportation of people safely and reliably was not fit for this purpose. It is apparent that the inclinators have experienced an unreasonable number of malfunctions and does not operate reliably. Accordingly, I find that the respondent breached s 61(1) of the ACL."

1. The Tribunal concluded, at [59], that the failure to comply with s 61 was a major failure and held:

"60 I am also satisfied that following the works undertaken by the respondent, the inclinators became substantially unfit for the purpose for which the respondent's services was acquired. Having regard to the number of breakdowns and repairs made to the inclinators, as well as the nature of those repairs, on balance, I consider that it is unlikely that the defects pertaining to the inclinators can be remedied easily and within a reasonable time.

61 Accordingly, the provisions in s 267(3) and (4) [of the ACL] apply."

(3) If the failure to comply with the guarantee cannot be remedied or is a major failure, the consumer may:

(a) terminate the contract for the supply of the services; or

(b) by action against the supplier, recover compensation for any reduction in the value of the services below the price paid or payable by the consumer for the services.

(4) The consumer may, by action against the supplier, recover damages for any loss or damage suffered by the consumer because of the failure to comply with the guarantee if it was reasonably foreseeable that the consumer would suffer such loss or damage as a result of such a failure.

"65 In my view, the respondent's breach of the guarantee as to fitness for a particular purpose means that the applicant had gained only minimal value from the works undertaken by the respondent, particularly when taking into account the inconvenience and expense in dealing with the frequent malfunctions of the inclinators. Having regard to the number and extent of repairs to the inclinators following the completion of the works by the respondent, I am satisfied that the applicant is entitled to be reimbursed the full amount of $44,946.00 that they had paid to the respondent."

"66 I am also satisfied that the applicant is entitled to be reimbursed for the amounts claimed for the brake test ($550.00), the repairs to the fence caused by collisions arising from the inclinator's failure to stop ($1,325.50), the breakdown repairs ($2,197.00), the expert report from CMG Elevator Management Pty Ltd ($5,280.00) and the expert report from Elevator Consultancy Service Pty Ltd ($350.00). This is because these items are reasonably foreseeable costs directly attributable to the breach of the guarantee in s 61 of the ACL."

1. The Tribunal dismissed Mr Anglicas' claim in respect of certain additional items and repairs, which the Tribunal concluded were costs which would have been incurred even if the works undertaken by Design had been fit for purpose.
2. The Tribunal also dismissed Mr Anglicas' claim in respect of consequential losses, because there was no evidence before the Tribunal to particularise the value of the losses, or to establish that those matters said to give rise to the losses were a consequence of defects in the inclinators.

1. An appeal to the Appeal Panel from a final decision of the Tribunal may be made "as of right on any question of law, or with leave of the Appeal Panel, on any other grounds": Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act), s 80(2)(b).
2. The meaning of a "question of law" was discussed in detail by the Appeal Panel in Unique Commercial Group Pty Ltd v Cusumano [2024] NSWCATAP 204 (Cusumano) at [25]-[40]. Examples of questions of law include the matters set out in Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69 at [13] and _Cusumano a_t [32]. However, the categories of question of law are not closed. As was stated at Cusumano at [37]-[39]:

"37 What constitutes a question of law is vexed and context dependent in the sense that the distinction between matters of fact and of law may turn on the circumstances in which the question arises: Targeted Property Investments Pty Ltd v Look Up Technologies Pty Ltd (No 2) [2023] NSWSC 416 at [33(4)], citing Thomas and Naaz [2023] NSWCA 40 at [52] and Da Costa v The Queen [1968] HCA 51; (1968) 118 CLR 186 at 194; [1968] HCA 51.

38 For instance, a ground of appeal that raises the question whether there were adequate reasons may constitute an attack on the merits which would not raise a pure question of law. On the other hand, it may be a contention that the decision is unreasonable in the requisite sense or that the Tribunal failed to exercise the jurisdiction, which would likely raise a question of law: see the exposition of this issue in Wollondilly [Shire Council v Styles [2024] NSWCATAP 104] at [28]- [32]. Care must in any event be taken. As has been clarified by amendment to the NCAT Act since Prendergast was decided, the Tribunal is not required to give reasons for all decisions it makes: NCAT Act, s 62(2A); see too: at - , [109]-[114].

(1) Whether the Tribunal applied the correct principle is a question of law: Bimson, Roads & Maritime Services v Damorange Pty Ltd [2014] NSWSC 734 at [40]- [45];

(2) Whether there has been:

"A 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."

is a question of law: The Owners - Strata Plan No. 12185 v Brown [2025] NSWCATAP 51 at [56(2)], citing Dranichnikov v Minister for Immigration and Migration Affairs [2003] HCA 26; 77 ALJR 1088; and Alexandria Landfill Pty Ltd v Transport for NSW (2020) 103 NSWLR 479; [2020] NSWCA 165 at [8]- [12] and [413]).

1. Clause 12 of Sch 4 to the NCAT Act provides that the Appeal Panel may grant leave to appeal against decisions of the Consumer and Commercial Division of the Tribunal pursuant to s 80(2)(b) of the NCAT Act only if it is satisfied that the appellant may have suffered a substantial miscarriage of justice because:

(a) the decision of the Tribunal under appeal was not fair and equitable; or

(b) the decision of the Tribunal under appeal was against the weight of evidence; or

(c) significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with).

1. The Appeal Panel considered the meaning of a substantial miscarriage of justice for the purposes of cl 12 of Sch 4 of the NCAT Act in Collins v Urban [2014] NSWCATAP 17 at [76], stating that a substantial miscarriage of justice may have been suffered:

"... where 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."

1. The principles to be applied by an Appeal Panel in determining whether leave to appeal should be granted are well settled. In Collins v Urban the Appeal Panel concluded at [84] that:

"(1) In order to be granted leave to appeal, the applicant must demonstrate something more than that the primary decision maker was arguably wrong in the conclusion arrived at or that there was a bona fide challenge to an issue of fact: BHP Billiton Ltd v Dunning [2013] NSWCA 421 at [19] and the authorities cited there, Nakad v Commissioner of Police, NSW Police Force [2014] NSWCATAP 10 at [45];

(2) Ordinarily it is appropriate to grant leave to appeal, only in matters that involve:

(a) Issues of principle; or

(b) questions of public importance or matters of administration or policy which might have general application; or

(c) 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; or

(d) a factual error that was unreasonably arrived at and clearly mistaken; or

(e) 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."

1. It is important to note that an appeal to the Appeal Panel does not simply provide a losing party in the Tribunal with the opportunity to run its case again, nor is it sufficient for an appellant to disagree with the outcome and to contend there should have been a different outcome: Frediani v Hall t/as Happy Camper Conversions [2024] NSWCATAP 134 (Frediani) at [30].

1. The grounds of appeal, as set out in the Notice of Appeal filed by Design, were:

"1. The ruling is unfair and unjust,

2. the NCAT Member failed to consider all the available evidence,

3. the applicant was misleading in his verbal evidence,

4. we strongly believe we have supplied goods and service reasonably fit for the purpose for what the customer wanted and we have complied with ACL and it can't be considered a "major failure" as he is still using the equipment, &

5. if a refund is due, based on ACL, there has been no proper directions given by the NCAT Member in regards to the returning of our goods."

1. Design also included, in the section of the Notice of Appeal which provided for the identification of the orders sought on the appeal, the following, which we understand to be intended to provide further elucidation of the grounds of appeal:

"1. The respondent has supplied the equipment that was quoted to the applicant. The equipment is reasonably fit for the purpose for what the applicant wanted, evidenced by the fact the respondent is still using the equipment. The applicant never specifically specified that the respondent had to supply everything to meet Australian Standard 1735.8. The lifts are now more suitable for human use. Any failure of the equipment within the warranty period was repaired in a timely manner under warranty ever time. Many of the warranty repairs were not due to the respondent's supply. The applicant is still using the equipment, and the equipment is still serviceable as evidenced by the respondent and his employee at their site visit back on the 25th Oct 2024. Therefore no refund is payable to the applicant."

1. Design also sought leave to appeal on each of the following bases: that the decision was not fair and equitable, that the decision was against the weight of evidence, and that there was significant new evidence now available that was not reasonably available at the time of the hearing.
2. In respect of the proposition that the decision was not fair and equitable, the Notice of Appeal stated:

"We believe one of the main reasons the member has made the current ruling was due to the number of times these machines have broken down. The NCAT member hasn't been given a chance to consider all the evidence. The member did not request to hear from our technicians and due to my lack of experience with NCAT matters I did not call the witnesses that were available and mentioned in our written defense. We would like to provide more evidence to give the member a better understanding of the circumstances.

...

I also believe the member didn't fully understand the video evidence that was provided. There is no mention in the members written response confirming that he actually viewed the video. We'd like the opportunity to explain this video in more depth.

We believe the tribunal member has incorrectly applied the damages provisions under section 267 of the Australian Consumer Law, where it should have been reduction in the value of the services provided, and there arguably was some value provided, evidenced by the applicants continued use of our equipment. In addition, the Tribunal member did not make clear the basis upon which the repair costs were recoverable as damages under section 267.

We strongly believe it is fair to say the applicant's poor workmanship has added to the number of breakdown repairs. The number of breakdown repairs are not all our fault. We believe it to be fair and it should be considered that the total amount of any refund should be reduced. The applicant is still using our equipment. If we are to pay a refund, based on ACL the equipment should be returned in good working order prior to any refund being paid. There has been no proper directions given by the NCAT Member in regards to the return of our goods, yet the applicant is still using them. If a refund is due, we would like to attend the applicants property and remove our equipment. Currently the applicant will not give us permission to enter his property. This is not fair. According to ACL the goods must be returned prior to any refund given."

1. In respect of the proposition that the decision of the Tribunal was against the weight of evidence, the Notice of Appeal stated:

"More weight should have be put on the photographic evidence in our written defence pages 15-22. These photos were taken at our site visit just prior to the hearing. The photos prove the applicant is still using our equipment and confirms we supplied goods and service reasonably fit for the purpose for what the customer wanted.

The Member hasn't give adequate reasons for their decision. The member doesn't explain the evidence that was relied upon for various decisions he has made, and didn't make all the factual findings required.

...

We strongly believe it is fair to say the applicant's poor workmanship has added to the number of breakdown repairs. The number of breakdown repairs are not all our fault. We believe it to be fair and it should be considered that if any amount of refund is payable it should be reduced. The applicant is still using our equipment, evidenced at our site visit and in the photos in our written defense pages 15-22. If we are to pay a refund, based on ACL, the equipment should be returned to us in good working order prior to any refund being paid. Currently the applicant has all our equipment. Surely it's not fair the applicant gets to keep all our equipment and we have to pay him a refund of $54,548? Within ACL the consumer is able to seek a refund if the items supplied do not match the description quoted. We have provided what we quoted. Our quotations are very clear. Based on section 61 of the ACI (1) b, we believe what we supplied is reasonably fit for the purpose for what the customer wanted. If the provision of the services was a "major failure" why is the applicant still using what we supplied?"

1. In respect of the proposition that there was significant new evidence now available that was not reasonably available at the time of the hearing, the Notice of Appeal stated that three technicians currently employed by Design, who had worked on the inclinators, were available to give evidence of the "poor workmanship of the applicant's installation". The Notice of Appeal acknowledged that the technicians were available at the time of the hearing "but the NCAT Member did not request to hear from them, and due to my lack of experience with NCAT matters I did not call on them myself on the day."
2. As the Appeal Panel held in Cominos v Di Rico [2016] NSWCATAP 5, at [13]:

"It may be difficult for self-represented appellants to clearly express their grounds of appeal. In such circumstances and having regard to the guiding principle, it is appropriate for the Appeal Panel to review an appellant's stated grounds of appeal, the material provided, and the decision of the Tribunal at first instance to examine whether it is possible to discern grounds that may either raise a question of law or a basis for leave to appeal. The Appeal Panel has taken such an approach in a number of cases, for instance, Khan v Kang [2014] NSWCATAP 48 and Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69. However, this must be balanced against the obligation to act fairly and impartially (Bauskis v Liew [2013] NSWCA 297 at [68] citing Hamod v State of New South Wales [2011] NSWCA 367 at [309]- [316]). Relevantly, s 38(2) provides that that Tribunal "may inquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of natural justice."

1. Adopting the approach to grounds of appeal drafted by unrepresented parties suggested in Cominos v di Rico, we identify the following possible questions of law:

(1) Whether the Tribunal applied the correct principle in determining that the contract between the parties was a contract for the supply of services and that the consumer guarantee in s 61 of the ACL was applicable.

(2) Whether the Tribunal failed to exercise its jurisdiction in failing to address Design's submissions concerning whether Mr Anglicas had made known to Design the purpose he wished to achieve and whether it was reasonable for Mr Anglicas to rely upon the skill or judgment of Design.

(3) Whether the Tribunal provided adequate reasons for concluding that the services (or goods and services) supplied by Design were not fit for purpose.

(4) Whether the Tribunal had applied the correct principles in assessing the compensation payable by Design, including whether the Tribunal should have made an order requiring Mr Anglicas to return the equipment installed by Design.

1. It is clear that the new evidence relied upon by Design was reasonably available at the time of the initial hearing: see Al-Daouk v Mr Pine Pty Ltd t/as Furnco Bankstown [2015] NSWCATAP 111. Accordingly, it is not necessary to consider whether we should grant leave to appeal on the ground that there is significant new evidence. The other grounds on which Design seeks leave to appeal largely restate the matters we have identified as potential questions of law. We will consider whether to grant leave to appeal in the context of each of the identified potential questions of law. We do note, however, that neither party provided a transcript of the hearing, and it is therefore impossible to know precisely what evidence was before the Tribunal at first instance or to conclude that the decision was against the weight of evidence: see Aboss v Hafeez [2022] NSWCATAP 345 at [30].

Ground 1 - Supply of goods or supply of services?

1. This issue arises from Design's submission that the Tribunal erred in failing to order the return of the equipment supplied by Design despite requiring Design to reimburse Mr Anglicas the full cost of the supply.
2. Section 55 of the ACL provides a consumer guarantee in respect of supplies of goods in similar terms to s 61. That section provides:

55 Guarantee as to fitness for any disclosed purpose etc.

(1) If:

(a) a person (the supplier) supplies, in trade or commerce, goods to a consumer; and

(b) the supply does not occur by way of sale by auction;

there is a guarantee that the goods are reasonably fit for any disclosed purpose, and for any purpose for which the supplier represents that they are reasonably fit.

(2) A disclosed purpose is a particular purpose (whether or not that purpose is a purpose for which the goods are commonly supplied) for which the goods are being acquired by the consumer and that:

(a) the consumer makes known, expressly or by implication, to:

(i) the supplier; or

(ii) a person by whom any prior negotiations or arrangements in relation to the acquisition of the goods were conducted or made; or

(b) the consumer makes known to the manufacturer of the goods either directly or through the supplier or the person referred to in paragraph (a)(ii).

(3) This section does not apply if the circumstances show that the consumer did not rely on, or that it was unreasonable for the consumer to rely on, the skill or judgment of the supplier, the person referred to in subsection (2)(a)(ii) or the manufacturer, as the case may be.

1. Although it might be suggested that there is little difference between the obligations imposed by ss 55 and 61, they are separate provisions. More significantly, the remedies available for a breach of s 55 differ from those available in respect of a breach of s 61.
2. The provisions governing the remedies available to a consumer in respect of a breach of a consumer guarantee relation to a supply of goods are contained in ss 259-266 of the ACL. The provisions governing the remedies available to a consumer in respect of a breach of a consumer guarantee in relation to a supply of services are contained in ss 267-270 of the ACL. There are significant differences.
3. In particular, s 259 provides that a consumer may reject goods which are not fit for purpose and cannot easily, and within a reasonable time, be remedied to make them fit for purpose.
4. Section 263(2) and (3) provide that, if a consumer rejects goods:

(2) The consumer must return the goods to the supplier unless:

(a) the goods have already been returned to, or retrieved by, the supplier; or

(b) the goods cannot be returned, removed or transported without significant cost to the consumer because of:

(i) the nature of the failure to comply with the guarantee to which the rejection relates; or

(ii) the size or height, or method of attachment, of the goods.

(3) If subsection (2)(b) applies, the supplier must, within a reasonable time, collect the goods at the supplier's expense.

1. Section 263(4) requires the supplier, if the consumer so elects, to refund any money paid by the consumer for the goods.
2. The Tribunal determined the appropriate remedy, for the breach of the consumer guarantee it found arose pursuant to s 61 of the ACL, by reference to ss 267 and 268 of the ACL. Those sections relevantly provide:

267 Action against suppliers of services

(1) A consumer may take action under this section if:

(a) a person (the supplier) supplies, in trade or commerce, services to the consumer; and

(b) a guarantee that applies to the supply under Subdivision B of Division 1 of Part 3‑2 is not complied with; and

(c) unless the guarantee is the guarantee under section 60 - the failure to comply with the guarantee did not occur only because of:

(i) an act, default or omission of, or a representation made by, any person other than the supplier, or an agent or employee of the supplier; or

(ii) a cause independent of human control that occurred after the services were supplied.

(2) If the failure to comply with the guarantee can be remedied and is not a major failure:

(a) the consumer may require the supplier to remedy the failure within a reasonable time; or

(b) if such a requirement is made of the supplier but the supplier refuses or fails to comply with the requirement, or fails to comply with the requirement within a reasonable time - the consumer may:

(i) otherwise have the failure remedied and, by action against the supplier, recover all reasonable costs incurred by the consumer in having the failure so remedied; or

(ii) terminate the contract for the supply of the services.

(3) If the failure to comply with the guarantee cannot be remedied or is a major failure, the consumer may:

(a) terminate the contract for the supply of the services; or

(b) by action against the supplier, recover compensation for any reduction in the value of the services below the price paid or payable by the consumer for the services.

(4) The consumer may, by action against the supplier, recover damages for any loss or damage suffered by the consumer because of the failure to comply with the guarantee if it was reasonably foreseeable that the consumer would suffer such loss or damage as a result of such a failure.

(5) To avoid doubt, subsection (4) applies in addition to subsections (2) and (3).

268 When a failure to comply with a guarantee is a major failure

(1) A failure to comply with a guarantee referred to in section 267(1)(b) that applies to a supply of services is a major failure if:

(a) the services would not have been acquired by a reasonable consumer fully acquainted with the nature and extent of the failure; or

(b) the services are substantially unfit for a purpose for which services of the same kind are commonly supplied and they cannot, easily and within a reasonable time, be remedied to make them fit for such a purpose; or

(c) both of the following apply:

(i) the services, and any product resulting from the services, are unfit for a particular purpose for which the services were acquired by the consumer that was made known to the supplier of the services;

(ii) the services, and any of those products, cannot, easily and within a reasonable time, be remedied to make them fit for such a purpose; or

(i) the services, and any product resulting from the services, are not of such a nature, or quality, state or condition, that they might reasonably be expected to achieve a result desired by the consumer that was made known to the supplier;

(ii) the services, and any of those products, cannot, easily and within a reasonable time, be remedied to achieve such a result; or

(e) the supply of the services creates an unsafe situation.

1. The terms "goods" and "services" are defined for the purposes of the ACL in s 2(1) of the ACL:

(a) ships, aircraft and other vehicles; and

(b) animals, including fish; and

(c) minerals, trees and crops, whether on, under or attached to land or not; and

(d) gas and electricity; and

(e) computer software; and

(f) second‑hand goods; and

(g) any component part of, or accessory to, goods.

(a) any rights (including rights in relation to, and interests in, real or personal property), benefits, privileges or facilities that are, or are to be, provided, granted or conferred in trade or commerce; and

(b) without limiting paragraph (a), the rights, benefits, privileges or facilities that are, or are to be, provided, granted or conferred under:

(i) a contract for or in relation to the performance of work (including work of a professional nature), whether with or without the supply of goods; or

(ii) a contract for or in relation to the provision of, or the use or enjoyment of facilities for, amusement, entertainment, recreation or instruction; or

(iii) a contract for or in relation to the conferring of rights, benefits or privileges for which remuneration is payable in the form of a royalty, tribute, levy or similar exaction; or

(iv) a contract of insurance; or

(v) a contract between a banker and a customer of the banker entered into in the course of the carrying on by the banker of the business of banking; or

(vi) any contract for or in relation to the lending of money;

but does not include rights or benefits being the supply of goods or the performance of work under a contract of service.

11 References to acquisition, supply and re‑supply

In this Schedule:

...

(c) a reference to the supply or acquisition of goods includes a reference to the supply or acquisition of goods together with other property or services, or both; and

(d) a reference to the supply or acquisition of services includes a reference to the supply or acquisition of services together with property or other services, or both; ...

1. The distinction between a supply of goods and a supply of services was discussed by Edelman J in Australian Competition and Consumer Commission v Valve Corp (No 3) [2016] FCA 196; 337 ALR 647 (Valve Corp) at [130]-[134]. His Honour set out the definitions of "goods" and "services" in s 2(1) of the ACL and continued:

"[130] The definition of "services" begins with a very broad inclusive definition as "any rights, benefits, privileges or facilities that are, or are to be, provided, granted or conferred in trade or commerce". That definition, if read literally with the definition of "goods" would create an odd situation in which the supply of some thing (say, a car) by way of sale would involve a supply of goods but the provision of the rights to the car would be a service. That oddity is avoided by the exclusionary words at the conclusion of the definition of service: a service "does not include rights or benefits being the supply of goods". Nevertheless, it is possible for a transaction to involve both a supply of goods and the provision of services. This is clear from the reference to services including "a contract for or in relation to the performance of work" where the contract can include "the supply of goods". Other provisions, such as s 3 (and see also s 11(c)) of the Australian Consumer Law also involve the notion of a "mixed supply" where "goods or services are purchased or acquired together with other property or services, or together with both other property and other services".

[131] Although it is possible for a contract for the provision of services also to include the "supply of goods", the effect of the exclusionary words at the end of the definition of services requires that the transaction first be characterised to determine whether it involves a "supply of goods". This is why s 11(c) provides that a reference to a supply of goods includes goods supplied with services but s 11(d) does not extend a reference to the supply of services to include a supply of goods. This is also why the Full Court of the Federal Court said, of the definitions, that an agreement could be one for services "unless the subscribers are to be characterised as the purchasers of 'goods'": ASX Operations Pty Ltd v Pont Data Australia Pty Ltd (No 1)[1990] FCA 710; (1990) 27 FCR 460, 467.

[132] If, properly characterised, the whole of the transaction involves the supply of goods then the exclusionary words in the definition of 'services' will mean that none of the supply will involve a service. This point was made by Wilson J in ; , 402:

The Act clearly contemplates that services may accompany the supply of goods in such a way as to constitute a single transaction properly described as a supply of goods. It follows that an act or series of acts, once characterized for the purposes of the Act as a supply of goods, cannot also be a supply of services: see Taperell, Vermeesch & Harland, Trade Practices and Consumer Protection, 3rd ed. (1983), p. 163. Thus a contract for the supply and fitting of a windscreen to a motor vehicle has been held to fall within a market in which persons supply goods rather than services: Cool & Sons Pty. Ltd. v. O'Brien Glass Industries Ltd. [1981] FCA 99; (1981) 35 ALR 445, at p 460] (upheld on appeal [[1983] FCA 191; [1983] FCA 191; (1983) 48 ALR 625, at pp 635, 646)]. It may not always be easy to make the characterization, the task being to identify, from all the circumstances of the case, the precise legal obligation undertaken by the supplier of the goods.

[133] Similarly, if a contract, properly construed, involves no supply of goods then the breadth of the definition of services might make the conclusion simple that the contract involved the provision of services. For instance, in E v Australian Red Cross Society[1991] FCA 603; (1991) 31 FCR 299, the Full Federal Court considered whether there had been a contract for the supply of blood plasma in the context of a claim alleging breach of terms which had been implied into the contract as a result of the Trade Practices Act. The appellant in that case had a contract with a hospital for the provision of nursing services and possibly also for medical attention (305 (Lockhart J)). But Lockhart J (with whom Sheppard and Pincus JJ agreed on this point) held that there was no contract for the supply of blood plasma which was intended to be supplied, if necessary, free of charge. His Honour held that since there was no contract for the supply of blood plasma, there was no contact for the supply of goods. He concluded at 306 that:

To the extent that goods were provided to him such as food, sleeping tablets, antibiotics, dressings and things of this nature, they were provided as an incident to the contract for the provision of services. There was no contract for the supply of goods. The contract between the [hospital] and the appellant was one for services and is not divisible into a contract for services and for the supply of goods.

[134] The remarks about whether food, sleeping tablets, or antibiotics were a "supply of goods" were not necessary for the decision. The decision did not concern any alleged defects in food, sleeping tablets, or antibiotics. No complaint had been made about any of these supplies. Further, it might be doubted whether this reasoning would apply to the new Australian Consumer Law regime which does not require a contract to be divided into services and goods but requires an initial enquiry into whether the respondent has obtained "rights or benefits being the supply of goods". It might now be questioned whether the conclusion could be reached that there was no supply of goods if, in the course of treatment, the appellant had been given defective antibiotics. However, even if it were the case that the mere incidental provision of goods is not a supply of goods, as I explain below, the goods supplied in this case were a core part of the supply, not an incidental part."

"The starting point, therefore, is to determine whether part, or all, of a transaction involves a supply of goods."

1. The judgment of Edelman J in Valve Corp was cited by the Appeal Panel in Frediani, at [14]-[15], in holding:

"14. It is unnecessary for us to set out and explore the findings and reasons of the Tribunal regarding breach of the consumer guarantees to provide services with due care and skill (s 60) and services fit for purpose (s 61).

15. The reason that such an analysis is unnecessary is that the contract to modify the van and transform it to a campervan/motorhome involved the provision of both goods (the installation of various items into the van, including plumbing; electrical items and outlets; toilet; bedding; sink; taps; and joinery) and services. The installation of goods was substantial. By reason of the definition of the supply of "goods" in ss 2 and 11 of the ACL, the whole of the transaction is properly characterised as a supply of goods ..."

1. See also Wilson v Winnicott [2021] NSWCATAP 211 at [77]- [99].
2. In the proceedings under appeal, the Tribunal did not undertake any consideration of the question whether the supply by Design to Mr Anglicas was a supply of goods or a supply of services.
3. In our view, it is manifest from the quotations accepted by Mr Anglicas that Design undertook to supply substantial items of equipment to Mr Anglicas. Design included in its evidence put before the Tribunal photographs showing the equipment which it had installed. That equipment cannot be described as insubstantial or its supply as merely incidental to a supply of services.
4. Accordingly, the Tribunal erred by applying inapplicable statutory provisions in determining the compensation payable to Mr Anglicas. That error on a question of law was material to the outcome of the proceedings by reason of the different provisions governing the remedies available for a breach of the respective consumer guarantees.
5. Notwithstanding that the requirements of the consumer guarantee in s 61 of the ACL closely mirror those in s 55, the remedial provisions in ss 267-269 of the ACL, relevant to a failure to comply with s 61, diverge substantially from those in ss 259-263, relevant to a failure to comply with s 55.
6. In particular, even if it could be said that the Tribunal's reasoning, concerning whether the supply was fit for purpose and whether the failure to be fit for purpose was a major failure, would have been no different if the Tribunal had appropriately applied ss 55 and 259-263 rather than ss 61 and 267-268, the Tribunal did not address the question whether Mr Anglicas had rejected the goods, which was a critical fact relevant to the determination of the appropriate remedy pursuant to ss 259-263.
7. Accordingly, this ground of appeal must be upheld.

Ground 2 - The conclusion that Mr Anglicas had made known to Design the purpose for which he was acquiring the goods supplied by Design and that it was reasonable for Mr Anglicas to rely upon Design's skill and judgment.

1. We have set out at [19] above the Tribunal's finding regarding disclosure of the purpose for which Mr Anglicas acquired the supply from Design. The Tribunal did not identify the manner in which Mr Anglicas communicated that purpose.
2. Mr Anglicas' evidence bundle included a form of statement in which Mr Anglicas stated:

"On completion of construction [of the two residences on Mr Anglicas' property], Design 2 Manufacture Pty Ltd was asked to supply a quotation to update the systems to inclinators suitable and approved to carry people, and to comply with AS1735.8 the Australian standard for inclined lifts.

Design 2 Manufacture Pty Ltd inspected the site, the condition and suitability of the rails and winch motor, gearbox, etc and provided a quotation, firstly for the first inclinator (1) and then for the second inclinator (2)."

"These quotations were accepted and a deposit paid."

1. It is not apparent that Design led any evidence of the discussions leading up to the provision and acceptance of the two quotations.
2. As noted, we have not been provided with a transcript of the hearing, and thus are unable to determine what oral evidence might have been given regarding that issue.
3. However, it is apparent from the Tribunal's outline of Design's submissions, as set out at [13] above, that Design disputed that it had been retained to achieve a particular result and that it was reasonable for Mr Anglicas to rely upon Design's skill and judgment to achieve a particular result.
4. Design maintained that it had not been contracted to ensure the inclinators complied with the relevant Australian Standard or to obtain Safe Work registration of the inclinators for passenger use.
5. The Tribunal did not identify the terms of the contract between the parties, nor did it make any findings concerning the communication by which Mr Anglicas communicated the purpose he wished to achieve.
6. It may reasonably be inferred that Mr Anglicas did communicate his desire to convert the inclinators he had constructed for carrying building materials into ones suitable for passenger use, but the Tribunal failed to give consideration to the question whether the circumstances showed that it was not reasonable for Mr Anglicas to rely upon Design's skill and judgment to achieve this purpose. The only consideration by the Tribunal was the proposition that "having regard to the nature of the core services provided by [Design] it was not unreasonable for [Mr Anglicas] to rely on the skills and judgment of [Design]."
7. The Tribunal did not identify the "nature of the core services" provided by Design.
8. In our view, the Tribunal has failed to engage with Design's submissions regarding the limited nature of what it agreed to supply and its role in bringing about the construction of two serviceable inclinators for the safe and reliable carriage of passengers.
9. In our view, the failure of the Tribunal to engage with Design's submissions regarding the nature of Mr Anglicas' engagement of Design raised a question of law of the character referred to in the passage from The Owners - Strata Plan No. 12185 v Brown set out at [] above. Accordingly, the appeal must be upheld on that basis also.

Ground 3 - Whether the goods and services supplied by Design were fit for purpose

1. Design relied upon photographs of the equipment it had installed included in its evidence tendered at first instance. It submitted that the photographs demonstrated that the components supplied by Design are "still installed and still being used" which is "clear evidence that the items are fit for the purpose".
2. The validity of that submission hinges critically upon the question what purpose Mr Anglicas made known to Design. Thus, this ground raises no issue independent of the second ground, which we have upheld.
3. The Tribunal provided detailed reasons why it was not persuaded by Design's submission that the services (or goods and services) supplied by Design were fit for purpose. The Tribunal addressed Design's submissions and explained why it not accept them. No question of law arises. To the extent Design seeks leave to appeal on this ground, in the absence of a transcript of the evidence given at the hearing, we could not conclude that the decision was against the weight of evidence. Nor, independently of the issues raised by the second ground, could the decision that the supply by Design is not fit for purpose, be found to be not fair and equitable.

Ground 4 - Wrong principles applied in the assessment of compensation/remedy

1. As we have held above, in our view the Tribunal had applied a wrong principle in the assessment of the appropriate remedy for the found breach of the consumer guarantee, in that it applied the provisions applicable in respect of a breach of s 61 of the ACL rather than those applicable respect of a breach of s 55.
2. It is apparent that the Tribunal proceeded on the basis that Mr Anglicas had not terminated the contract with Design, as it assessed the compensation payable to Mr Anglicas on the basis that the value of the services provided by Design was negligible. In other words, the Tribunal awarded Mr Anglicas "compensation for [the] reduction in the value of the services below the price paid ... by [Mr Anglicas] for the services" pursuant to s 267(3)(b).
3. Had the Tribunal determined that Mr Anglicas had elected to terminate the contract with Design, s 269(3) would have operated to entitle Mr Anglicas to a refund of the monies paid to the Design, save to the extent that Mr Anglicas had "already consumed the services at the time the termination takes effect". However, in that event, s 270 would have required Mr Anglicas to return the goods supplied that were connected with the services, or permit Design to collect the goods.
4. Had the Tribunal, correctly, applied s 259, subs 259(3) would have required either:

(1) The rejection of the goods supplied by Design, in which event, pursuant to s 263(4), Mr Anglicas would have been entitled to a refund of all monies paid for the goods, but would have been required to return the goods or allow Design to collect the goods; or

(2) The compensation payable to Mr Anglicas be measured by the "reduction in the value of the goods below the price paid ... for the goods".

1. The Tribunal purported to assess compensation by reference to the reduction in value of the services provided by Design by reason of their failure to be fit for purpose, rather than by reference to the reduction in value of the goods supplied by Design. The Tribunal considered that the services provided by Design had had negligible value to Mr Anglicas. It did not consider whether the goods supplied by Design had any value to Mr Anglicas.
2. There is no suggestion that Mr Anglicas had rejected the goods supplied by Design. In our view, the fact that Mr Anglicas did not reject the goods may be taken as evidence that the goods had some value.
3. In Coliban Heights Pty Ltd v Citisolar Vic Pty Ltd [2018] VSCA 191 at [48] the Victorian Court of Appeal held, in the context of a claim for breach of consumer guarantee in respect of what was held to be a contract for services,[1] that the fact, that the consumer had sought to retain the goods connected with the services which had been supplied, was inconsistent with the consumer having terminated the contract.
4. A similar process of reasoning would suggest that, if the goods had no value, Mr Anglicas would have sought to reject them and, if not return them to Design, at least ask Design to remove them. The Tribunal did not consider these questions and, accordingly, it cannot be said that the Tribunal's application of the incorrect provisions of the ACL in considering what remedy should be awarded to Mr Anglicas had no impact on the outcome of the proceedings.
5. It follows that the fourth ground of appeal must also be upheld.

1. Because the parties did not provide to the Appeal Panel a transcript of the hearing at first instance, the Appeal Panel is not in a position, even if it were so minded, to determine the outcome of the proceedings itself, as authorised by s 81 of the NCAT Act. The proceedings must be remitted to the Consumer and Commercial Division for reconsideration consistently with these reasons. Because the Member who constituted the Tribunal at first instance has made firm findings of fact concerning critical issues, it is appropriate that the remitted proceedings be heard by a Tribunal constituted by a different member. Because these reasons have highlighted a number of issues which were not, apparently, considered by the parties in the course of preparation for the initial hearing, it is appropriate that the parties have the opportunity to lead further evidence at the remitted hearing.
2. It should be made clear that, save for the conclusion that the contract between the parties was for the supply of goods and services, and thus, for the purposes of the ACL, a contract for the supply of goods, nothing we have said in these reasons should be taken as determining any question of fact which may arise in the remitted hearing.
3. Our orders are:

(1) Leave to appeal is granted to the extent necessary.

(2) The appeal is allowed.

(3) Order 1 made by the Tribunal on 28 January 2025 in proceedings 2024/00306794 is set aside.

(4) The proceedings are remitted to the Consumer and Commercial Division of the Tribunal, differently constituted, for determination consistently with these reasons for decision, on the evidence before the Tribunal at the original hearing and such further evidence as the parties may seek to rely upon.

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.

[1] It is not necessary for the purposes of this decision to consider whether that conclusion is consistent with the principles outlined by Edelman J in Valve Corp or, if not, whether the decision of the Victorian Court of Appeal casts doubt upon the reasoning of Edelman J. The proceedings in the Court of Appeal were a further appeal in proceedings which originated in the Victorian Civil and Administrative Tribunal. Edelman J's judgment in Valve Corp was not referred to at any level of the proceedings and there was no discussion in any of the decisions of the question whether the contract was for the supply of goods or for the supply of services