Donohoe v Albulario

Ground 1 and the first limb of ground 2 of the amended grounds of appeal

1. Before considering these grounds, it is appropriate to set out the applicable statutory provisions and legal principles, the relevant evidence, and the submissions of the parties.

The applicable statutory provisions

1. The NCAT Act includes section 38 which deals with the procedure of the Tribunal generally, and relevantly provides: 38 Procedure of Tribunal generally … (5) The Tribunal is to take such measures as are reasonably practicable - … (c) to ensure that the parties have a reasonable opportunity to be heard or otherwise have their submissions considered in the proceedings. …

The applicable legal principles

1. In Flightdeck Geelong Pty Ltd v All Options Pty Ltd (2020) 280 FCR 479; [2020] FCAFC 138 (Flightdeck Geelong) the Full Federal Court (Markovic, Derrington and Anastassiou JJ) considered the scope of the Court's obligation to assist an unrepresented litigant. The Court at [51]-[60] relevantly made the following observations as to the Court's duty to the litigant-in-person and relief for denial of procedural fairness: "The Court's duty to the litigant-in-person [51] The submissions advanced on appeal revealed the existing lack of clarity as to the obligations of a court to a litigant-in-person. Though the principles might be succinctly stated at a high level of generality, their application in a particular case is somewhat more problematic. … [52] As acknowledged by the High Court in Neil v Nott (1994) 68 ALJR 509 at 510; 121 ALR 148 at 150, "[a] frequent consequence of self-representation is that the court must assume the burden of endeavouring to ascertain the rights of parties which are obfuscated by their own advocacy". …. [53] However, whilst disadvantages exist and the Court is obliged to act to ameliorate them by giving assistance to the unrepresented litigant, its role is constrained by its concurrent duty to remain an impartial adjudicator: … Indeed, the Court must strike a fine balance between providing assistance to a litigant-in-person, and ensuring a fair trial for all parties: … [54] The assistance provided to a litigant-in-person must therefore be limited to that which is necessary to diminish the disadvantage which he or she will ordinarily suffer, and the Court should be wary to avoid placing a litigant-in-person in a position of advantage or privilege over a represented opponent. … [55] In practical terms, the Court may find it appropriate to provide the following kinds of assistance to a litigant-in-person: (a) Ensuring the litigant has sufficient information about the practice and procedure of the Court to make effective choices in the conduct of the matter: … (b) Ensuring the litigant is informed of procedures which, if invoked, may prove to be advantageous: … (c) Ensuring the litigant has not, because of a lack of legal skill, failed to claim rights or put forward arguments: … [56] The duty of the Court does not extend to providing judicial advice, counselling a litigant on how to exercise their rights, or conducting the case on their behalf: … Nor does the duty of the Court require it to view a litigant-in-person's case with a favourable eye. … [57] It seems to be well accepted that the extent of the Court's obligation to assist an unrepresented litigant is factually idiosyncratic and, significantly, depends upon "the litigant, the nature of the case, and the litigant's intelligence and understanding of the case": … Relief for denial of procedural fairness [58] A denial of procedural fairness must work a practical injustice on the appellant in order for the Court to exercise its discretion to grant relief: …. An appellant alleging a denial of procedural fairness need only demonstrate that they were deprived of the possibility of a successful outcome; to negate that possibility it is necessary to find that a properly conducted trial could not possibly have produced a different result: …. To put it another way, as framed by the Full Court in King v Delta Metallics Pty Ltd [2013] FCAFC 93 at [59], "[i]f the denial of procedural fairness would have made no difference to the outcome of the proceeding, relief will not be granted": …. [59] Depending on the circumstances of the case, the onus may be on the appellant to demonstrate what they would have done, or what evidence they would have led, so as to establish they were in fact denied procedural fairness. As explained by Gageler and Gordon JJ in Minister for Immigration and Border Protection v WZARH (2015) 256 CLR 326 at [59]-[60]: "There are cases in which conduct on the part of an administrator in the course of a hearing can be demonstrated to have misled a person into refraining from taking up an opportunity to be heard that was available to that person in accordance with an applicable procedure which was otherwise fair. To demonstrate that the person would have taken some step if that conduct had not occurred is, in such a case, part of establishing that the person has in fact been denied a reasonable opportunity to be heard. **493 Where, however, the procedure adopted by an administrator can be shown itself to have failed to afford a fair opportunity to be heard, a denial of procedural fairness is established by nothing more than that failure, and the granting of curial relief is justified unless it can be shown that the failure did not deprive the person of the possibility of a successful outcome. The practical injustice in such a case lies in the denial of an opportunity which in fairness ought to have been given." (Footnotes omitted.) (Emphasis added.) [60] In reaching this conclusion, their Honours cited the Full Court decision of WACO v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 131 FCR 511, where at [58] their Honours had observed that where a party has been denied an opportunity to be heard on an important issue, that will amount to a denial of procedural fairness unless it can be shown that the appellant could not, even if given the opportunity to do so, affect the outcome. …." (citations omitted except as included)
2. We note that s 38(5) of the NCAT Act reflects the general law duties of procedural fairness and the principles in Flightdeck Geelong at [51]-[60] apply to proceedings in the Tribunal: see, for example, Jeray v Blue Mountains City Council [2024] NSWCATAP 66 at [13]-[15], [18].
3. In Italiano v Carbone & Ors [2005] NSWCA 177 (Italiano) at [105]-[107], Basten JA explained in relation to the Consumer, Trader and Tenancy Tribunal (which was a predecessor of the Tribunal) that a failure to adjourn proceedings or to advise a litigant of his right to apply for an adjournment may constitute a failure to afford procedural fairness to the litigant: "[105] The remaining question is thus whether, on the evidence, the Tribunal was under an independent obligation to take particular steps which it did not do. If so, the consequent question is whether its failure invalidated the resulting orders. There is statutory support in the CTTT Act for such obligations. Thus, s.35 (set out at [69] above) provides that the Tribunal "must ensure" that each party is given "a reasonable opportunity" to present its case. Where necessary this will entail offering an appropriate adjournment, whether sought or not. In addition, s.28(4) (see [68] above) requires the Tribunal to "take such measures as are reasonably practicable" to ensure that the parties understand not only the nature of the assertions made in the proceedings, but also "the legal implications of those assertions". [106] There are, as already noted, provisions which allow the Tribunal a significant degree of flexibility in adapting its procedures to the exigencies of the case in determining the manner in which the proceedings will be conducted. Nevertheless, those provisions should not be construed so as to derogate from other provisions cast in obligatory language which constitute core elements of procedural fairness. That conclusion is consistent with the approach adopted by the High Court in SAAP in relation to the obligation imposed on the Refugee Review Tribunal under s.424A of the Migration Act to give an applicant, in the way that the Tribunal considered appropriate in the circumstances, information which the Tribunal considered might be the reason or part of the reason for affirming the decision adverse to the applicant. [107] A provision in similar terms to those contained in s.35 of the CTTT Act led Deane J in Sullivan v Department of Transport (1978) 20 ALR 323 at 342 (25) to state: "Where a Tribunal is under a duty to act judicially, the principle that a party must be given a reasonable opportunity to present his case is at the heart of the requirements of natural justice which it is obliged to observe… . If, in all the circumstances, the failure of the Tribunal to adjourn the matter to enable Dr Evans to be called as a witness or to alert the appellant of his right to apply for such an adjournment constituted a denial to the appellant of a reasonable opportunity of presenting his case, both the common law principles applicable to a tribunal under a duty to act judicially and the specific provisions [of the Act] entitle the appellant to the intervention of this Court." His Honour then referred to provisions in the Administrative Appeals Tribunal Act (s.33(1)(b)) equivalent to s.28(3) of the CTTT Act. His Honour concluded, at p.343 (10): "A refusal to grant an adjournment can constitute a failure to give a party to proceedings the opportunity of adequately presenting his case. If the Tribunal had, in the present matter, refused an application by the appellant for an adjournment … that refusal may well have constituted such a failure. No such application for an adjournment was, however, made. If it had been made, it is highly probable that the Tribunal would have acceded to it: indeed, counsel who appeared for the appellant stated that he did not dispute that, if the appellant had applied for an adjournment, the Tribunal would have granted it. The absence of any application for an adjournment does not, however, necessarily conclude the issue adversely to the appellant. The failure of a Tribunal which is under a duty to act judicially to adjourn a matter may, conceivably, constitute a failure to allow a party the opportunity of properly presenting his case even though the party in question has not expressly sought an adjournment (see Priddle v Fisher & Sons [1968] 1 WLR 1478; [1968] 3 All ER 506. In this regard, however, it is important to remember that the relevant duty of the Tribunal is to ensure that a party is given a reasonable opportunity to present his case. Neither the Act nor the common law imposes upon the Tribunal the impossible task of ensuring that a party takes the best advantage of the opportunity to which he is entitled." …"
4. The principles in Italiano at [105]-[107] have been applied by the Appeal Panel to proceedings in the Tribunal: see, for example, Roach v Swain [2021] NSWCATAP 258 at [29]-[30].
5. In Gallo v Duflou [2014] NSWCATAP 115 (Gallo) at [33], the Appeal Panel made the following observations about the duty of the Tribunal to an unrepresented party: "Where a party is unrepresented, a court or tribunal has a common law duty to ensure that that party understands that they may cross examine the other party and that party's witnesses. This is particularly so where the absence of an understanding of a procedural matter adversely affects a party's opportunity to be heard." (citations omitted)
6. In Jannis v Ant-Hassa Pty Ltd [2020] NSWCATAP 99 (Jannis) at [29]-[31], the Appeal Panel considered whether the appellants had been denied procedural fairness by not being provided an opportunity to cross-examine the respondent's witnesses: "[29] It is well-established that a failure by the Tribunal to allow a party an opportunity to cross-examine another party's witness may, in some situations, constitute a denial of procedural fairness. [30] Further, where a party is unrepresented, a failure by the Tribunal to explain its procedures, if requested to do so, may also constitute a denial of procedural fairness, as well as a failure to comply with its obligations under s 38(5) of the NCAT Act. This principle has, in some instances, led Appeal Panels in this Tribunal to decide that a failure to inform an unrepresented party that they had a right to cross-examine the other party's witnesses was an error of law. [31] However, cross-examination is not an essential element of an oral hearing, nor is there a rigid rule that fairness always requires cross-examination to be permitted in administrative hearings." (citations omitted)

The relevant evidence

1. In the Donohoe appeal documents submissions, Mr Donohoe drew attention to the following evidence relevant to this issue: 1. order 2 of the 20 October 2023 orders when read with "Important Note"; 2. his affidavit sworn on 25 November 2023 (the 25 November 2023 Donohoe affidavit) at [6] in which he relevantly made the following submission in relation to order 2 of the 20 October 2023 orders and the Construction Proposal: "6 In the Notice of Order there is an IMPORTANT NOTE at page 1 of the Notice of Order, stating that 'Expert reports prepared in accordance with the NCAT Procedural Direction 3 for Expert Witnesses'. The applicant has not engaged an expert witness nor has the applicant supplied through the Builder (Mattrix Group) an Expert Witness Report prepared in accordance with NCAT Procedural Direction 3 … The applicant rather has supplied a written Construction Proposal from a Builder (Mattrix Group) which has no line-item pricing. ... The items in the Proposal costings cannot be verified nor agreed upon which has been submitted in the incorrect format and not that of a Scott Schedule." 1. the following passages in the 13 December 2023 transcript: 1. about the parties' right to cross-examine (p 2, ll 23-25): "SENIOR MEMBER TITTERTON: … Mr Donohoe, you have a right to cross-examine the Albularios if you want to ask them 24 any questions about factual matters and you have a right to cross-examine or ask 25 Mr Donohoe questions about factual matters if you wish to." 1. about the prejudice to Mr Donohoe in relation to admission of the Construction Proposal into evidence (p 5, ll 130-136): "SENIOR MEMBER TITTERTON: And I assume you're going to say that that's not going to be probative or persuasive evidence of the cost of completion of the project? DONOHOE: I can't argue against the price because I haven't been given a clear precise breakdown of each component of what the quote is. SENIOR MEMBER TITTERTON: Yes, I understand. All right." 1. about the failure of Mr Donohoe to adduce expert evidence (pp 19, l 762-20, l 777): "SENIOR MEMBER TITTERTON: When were you last there? WITNESS DONOHOE: A long time ago. I asked to go to do an inspection with my expert witness but that never eventuated because of - SENIOR MEMBER TITTERTON: You weren't given access? WITNESS DONOHOE: No, it wasn't that I wasn't given access, Senior Member, it was I didn't get an expert witness because I didn't have an answer to - SENIOR MEMBER TITTERTON: You didn't have anything to respond to is what you're saying? WITNESS DONOHOE: That's what I'm saying, so - SENIOR MEMBER TITTERTON: That's all right, okay. …" 1. about his response to any defective works and incomplete works and the Construction Proposal (p 30, ll 1229-1240): "SENIOR MEMBER TITTERTON: … Okay, well now it's your turn, Mr Donohoe, you tell me exactly what you want to say about any defective works, about incomplete works and what you want to say about the Mattrix report in addition to what you've already put down in your affidavit? WITNESS DONOHOE: Okay. So with those two reports, there's no documented evidence on how they were going to repair or rectify the works. SENIOR MEMBER TITTERTON: So no scope of works - WITNESS DONOHOE: No scope of works. SENIOR MEMBER TITTERTON: - for rectification. …"

The submissions of Mr Donohoe

1. In the Donohoe appeal submissions, Mr Donohoe made the following submissions: 1. the Tribunal denied him a reasonable opportunity to be heard in breach of s 38(5) of the NCAT Act by permitting the Albularios to rely on the Construction Proposal without affording him an opportunity to commission evidence in reply. As a consequence of accepting the Construction Proposal into evidence, despite "the admitted non compliances with the rules", the Tribunal should have done the following two things to ensure procedural fairness and compliance with the NCAT Act: 1. it should have pointed out to him that he had no evidence before the Tribunal to confront the Construction Proposal and it was therefore likely that his case would fail; 2. it was open to him to make an application for an adjournment to deal with the prejudice occasioned by the admission of the Construction Proposal into evidence; 1. he clearly indicated he would suffer prejudice if Construction Proposal was to be accepted into evidence (Tcpt, 13 December 2023, p 5, ll 130-136; p 30, ll 1229-1240); 2. the Tribunal denied him procedural fairness by not advising him that he had a right to not only cross examine the Albularios, but also their witnesses as explained in Gallo at [33].

The submissions of the Albularios

1. The Albularios denied that the Tribunal failed to afford procedural fairness to Mr Donohoe, but did not address any arguments as to why the requirements for procedural fairness had been satisfied in respect of his specific complaints.

Consideration

1. We are satisfied that the Senior Member should have understood from the exchanges during the hearing (Tcpt, 13 December 2023, pp 19, l 762-20, l 777) that Mr Donohoe did not adduce expert evidence because the Construction Proposal did not comply with NCAT Procedural Direction 3 - Expert Evidence (PD3) and that he was prejudiced by its admission into evidence. While the Senior Member was entitled to dispense with compliance with PD3 by Mr Donohoe, having regard to the principles in Italiano at [105]-[107], he should have informed Mr Donohoe that he had a right to apply for an adjournment for the purpose of obtaining expert evidence.
2. We are also satisfied that the Senior Member understood the deficiencies of the Construction Proposal as expressed in the 29 April 2024 reasons at [51]. He should have understood the importance of cross-examination as a means of Mr Donohoe challenging its accuracy. In these circumstances, having regard to the principles in Gallo at [33] and Jannis at [29]-[31], he should have informed Mr Donohoe that he had a right to cross-examine Mr Elali.
3. However, we are not satisfied that the Tribunal breached s 38(5)(c) of the NCAT Act and the principles in Flightdeck Geelong at [51]-[60] by its failure to ensure that Mr Donohoe had a reasonable opportunity to be heard by informing him he had a right to apply for an adjournment and to cross-examine Mr Elali because he adduced no evidence that he would have applied for an adjournment and/or cross-examined Mr Elali if he had been informed of his rights to do so.
4. In these circumstances, we are not satisfied that the 29 April 2024 decision was not fair and equitable within cl 12(1)(a) of Sch 4 of the NCAT Act on these amended grounds of appeal. It follows that we have decided to refuse Mr Donohoe leave to appeal on these grounds.

The alternative limb of ground 2 of the amended grounds of appeal

1. Counsel for Mr Donohoe in his oral submissions submitted that the Tribunal should not have received the Construction Proposal into evidence because it did not comply with Khan at [50] where the Appeal Panel dealt with evidence of the defects or incomplete work and of the amount required to remedy the defective work or complete any incomplete work: "[50] A quotation from a supplier willing to rectify defects or complete incomplete work can, depending on the circumstances and the nature and content of the quotation, constitute evidence of the defects or incomplete work and of the amount required to remedy the defective work or complete any incomplete work. For example, if the person providing the quotation was suitably qualified or experienced, inspected the work, identified defects or incomplete work on that inspection, recorded his or her observations in the quotation and gave a price to rectify or complete the work, it is difficult to understand why that quotation would not provide evidence in support of a claim for defective or incomplete work. The weight to be given to the evidence would, of course, depend upon many factors. Nonetheless, it would be wrong to conclude that simply because an applicant relied only upon a quotation or quotations for the rectification or completion of work that there was no evidence to support the claim that the work was defective or incomplete."
2. We accept that the Tribunal, notwithstanding the terms of order 2 of the 20 October 2023 orders, was entitled to receive the Construction Proposal into evidence pursuant paras 3 and 5 of PD3 which relevantly provide: "3. In proceedings where the Tribunal is not bound by the rules of evidence, the acceptability of expert evidence is a question of weight not admissibility. Nonetheless, if those proceedings involve complex or difficult expert issues, it is appropriate to require expert evidence to be prepared and presented in a manner which seeks to ensure its usefulness." "5. The Tribunal may excuse a party or an expert witness from complying with this Procedural Direction before or after the time for compliance."
3. We do not accept the submission of Mr Donohoe that the Construction Proposal was not a quotation as contemplated in Khan at [50] because Mr Elali expressed an opinion as to the total cost to rectify the defective work and to complete the incomplete work, and did not include the cost of each component of the rectification work and the completion work. The Appeal Panel did not specify in Khan at [50] that a quotation from a supplier must include the cost of each component of the rectification work and the completion work to be accepted as evidence of the cost to rectify the defective work and to complete the incomplete work, but indicated that the weight to be given to the evidence would depend upon many factors.
4. In these circumstances, we are not satisfied that the 29 April 2024 decision was not fair and equitable within cl 12(1)(a) of Sch 4 of the NCAT Act on this alternative amended ground of appeal. It follows that we have decided to refuse Mr Donohoe leave to appeal on this ground.

Ground 3 of the amended grounds of appeal

1. In the Donohoe appeal submissions Mr Donohoe made the following submissions: 1. he referred to Makita (Australia) Pty Ltd v Sprowles (2001) 52 NSWLR 705; [2001] NSWCA 305 (Makita) at [59], [64], [68], [71] and [79]; 2. the principles in Khan at [49]-[52] are distinguishable for the following reasons: 1. the Appeal Panel in Khan at [50] by stating "depending on the circumstances and the nature and content of the quotation" puts a clear limitation on the use of quotations; 2. the Appeal Panel in Khan at [51] clearly distinguishes between small quotes and larger quotes: "51 Of course, a quotation relied upon by a party may be inadequate for these purposes but, if this is to be the Tribunal's conclusion, the reasons for rejecting the quotation must be explained in the reasons for decision. Such an explanation does not have to be lengthy especially in a claim that has only a small monetary value, but some explanation is required. This is what s 62(3) entails when it requires findings of fact to be made referring to the evidence or other material on which those findings were based and when it requires the reasoning processes that led the Tribunal to its conclusions to be set out." 1. it is remarkable in itself that a quote for $396,000 would not include some break-up of the costings and the rates charged. Plainly, in Khan the Appeal Panel was alive to the fact that before a quote could be accepted into evidence the Tribunal would necessarily have some regard to how the quote was made up, particularly when it came to larger numbers; 2. it is relevant to note the following passages in the 13 December 2023 transcript: 1. the Senior Member stated the cost of the Construction Proposal "seems like a lot of money" (p 24, ll 958-960); 2. Mr Donohoe gave evidence that there is no scope of works in the Construction Proposal (p 30, ll 1233-1234); 3. the Senior Member stated that he can't even guess at what the scope of works may be (p 32, ll 1312-1313); 4. Mr Donohoe gave evidence that the costing in the Construction Proposal is not what was contracted for between the parties, and contains alterations to the original scope (p 36, ll 1463-1464; p 38, ll 1560-1564).
2. In Makita at [85], Heydon JA summarised the requirements for expert evidence to be admissible under s 79 of the Evidence Act 1995 (NSW): "[85] In short, if evidence tendered as expert opinion evidence is to be admissible, it must be agreed or demonstrated that there is a field of "specialised knowledge"; there must be an identified aspect of that field in which the witness demonstrates that by reason of specified training, study or experience, the witness has become an expert; the opinion proffered must be "wholly or substantially based on the witness's expert knowledge"; so far as the opinion is based on facts "observed" by the expert, they must be identified and admissibly proved by the expert, and so far as the opinion is based on "assumed" or "accepted" facts, they must be identified and proved in some other way; it must be established that the facts on which the opinion is based form a proper foundation for it; … the expert's evidence must explain how the field of "specialised knowledge" in which the witness is expert by reason of "training, study or experience", and on which the opinion is "wholly or substantially based", applies to the facts assumed or observed so as to produce the opinion propounded. …"
3. The New South Wales Court of Appeal has further explained the requirements and application of s 79 of the Evidence Act in Forster v Hunter New England Area Health Service (2010) 77 NSWLR 495; [2010] NSWCA 106 (Forster), and Hancock v East Coast Timber Products Pty Ltd (2011) 80 NSWLR 43; [2011] NSWCA 11 (Hancock). The New South Wales Court of Appeal has also considered expert evidence in appeals from the Workers Compensation Commission where the rules of evidence do not apply in Southwestern Sydney Area Health Service v Edmonds [2007] NSWCA 16 (Edmonds) and Hancock.
4. In Shakiri v Holland [2024] NSWCATAP 28 (Shakiri), the Appeal Panel at [88]-[97] set out passages in Forster, Makita, Edmonds and Hancock, and at [98] concluded: "[98] It is evident that the legal principles to be applied when considering the admissibility of expert evidence under s 79 of the Evidence Act are similar to those to be applied in non-Evidence proceedings before this Tribunal, where the question is not the admissibility of an expert opinion, but the weight to be given to it. The content of an expert report, its form, the relevance and sufficiency of the expert's demonstrated expertise, the adequacy of the report's explanation of the facts (both demonstrated and assumed), and the clarity of the reasoning leading to its conclusions, will all be central to the ultimate weight given to it by the Tribunal."
5. Having regard to the principles in Shakiri at [98], we do not accept the submissions of Mr Donohoe that the Tribunal erred in placing weight on the Construction Proposal which: 1. specified the documents on which it is based as referred to in the 29 April 2024 reasons at [45]; 2. identified the scope of works set out under the five headings as referred to in the 29 April 2024 reasons at [44]; 3. stated the cost of $396,060.00 inclusive of GST as referred to in the 29 April 2024 reasons at [46]; 4. was provided by Mr Elali who had the qualifications as referred to in the 29 April 2024 reasons at [49].
6. In these circumstances, we are not satisfied that the 29 April 2024 decision was not fair and equitable within cl 12(1)(a) of Sch 4 of the NCAT Act on this amended ground of appeal. It follows that we have decided to refuse Mr Donohoe leave to appeal on this ground.

Ground 4 of the amended grounds of appeal

1. In the 8 July 2024 Donohoe statement Mr Donohoe has given evidence that he has had contractor licence (number 152495C) within the category of general building work since it was issued on 27 June 2006. We accept this evidence.
2. We are satisfied that the Senior Member was in error in finding in the 29 April 2024 reasons at [40] that Mr Donohoe was unlicensed. However, it is clear from the words "In any event" in this paragraph that the Senior Member exercised the discretion under s 48O(1)(a) of the HB Act to make a money order independently of the contractual status of Mr Donohoe and this finding was not material to that decision. To the extent that this ground of appeal is based on this error it is misconceived.
3. In Coscuez International Pty Ltd v The Owners-Strata Plan No 46433 [2022] NSWCATAP 147 (Coscuez International) at [87], the Appeal Panel explained the principles applicable to adequacy of reasons: "[87] The principles applicable to adequacy of reasons were dealt with by the NSW Court of Appeal in New South Wales Land and Housing Corporation v Orr [2019] NSWCA 231 at [65]-[77]. The quality (or detail) of reasons does not have to be optimal, but it must meet the minimum acceptable standard or "minimum characteristics" to be able to understand: (1) the findings on material questions of fact, referring to the evidence or other material on which those findings were based, (2) the Tribunal's understanding of the applicable law, and (3) the reasoning processes that lead the Tribunal to the conclusions it made."
4. The fact that the Tribunal makes an error does not necessarily mean that the decision should be set aside, unless the error is material in the sense that it "might" or "may" have made a difference to the decision: Meacham v Commissioner of Police [2020] NSWCATAP 107 (Meacham) at [29].
5. Having regard to the principles at Coscuez International at [87], we accept the submissions of Mr Donohoe that the Senior Member failed to provide adequate reasons for his finding that the Albularios had made out a case for a money order and not the preferred outcome of a work order provided for in s 48MA of the HB Act. It is unclear why the Senior Member exercised the discretion under s 48O(1)(a) of the HB Act to make a money order.
6. Having regard to the principles at Meacham at [29], this error was not material in the sense that it "might" or "may" have made a difference to the decision for the reason that the Senior Member found in the 29 April 2024 reasons at [34] that on 22 September 2023 the Albularios terminated the contract. In circumstances where this finding has not been challenged in the amended grounds of appeal, there was no error made by the Senior Member in the exercise of the discretion under s 48O(1)(a) of the HB Act to make a money order.
7. In these circumstances, we are not satisfied that the 29 April 2024 decision was not fair and equitable within cl 12(1)(a) of Sch 4 of the NCAT Act on this amended ground of appeal. It follows that we have decided to refuse Mr Donohoe leave to appeal on this ground.

Conclusion

1. As we are not satisfied that the 29 April 2024 decision was not fair and equitable within cl 12(1)(a) of Sch 4 of the NCAT Act on each of the grounds in the amended grounds of appeal, the exercise of the discretion under this clause does not arise. It follows that leave to appeal should be refused.

Introduction

1. Before considering this issue, it is appropriate to set out the applicable statutory provisions and legal principles, and the submissions of the parties.

NCAT Act

1. Section 60(1), (2) and (5)(b) of the NCAT Act relevantly provide that each party to an appeal is to pay the party's own costs and the Tribunal may award costs in relation to an appeal only if it is satisfied that there are special circumstances warranting an award of costs.
2. In proceedings commenced in the Consumer and Commercial Division, by reason of the operation of s 35 when read with par (a) of the definition of "procedural rules" and the definition of "Tribunal rules" in s 4(1) of the NCAT Act, s 60 is subject to the NCAT Rules.

NCAT Rules

1. Rule 38 of the NCAT Rules relevantly provides: 38 Costs in Consumer and Commercial Division of the Tribunal (1) This rule applies to proceedings for the exercise of functions of the Tribunal that are allocated to the Consumer and Commercial Division of the Tribunal. (2) Despite section 60 of the Act, the Tribunal may award costs in proceedings to which this rule applies even in the absence of special circumstances warranting such an award if - … (b) the amount claimed or in dispute in the proceedings is more than $30,000.
2. Rule 38A of the NCAT Rules relevantly provides: 38A Costs in internal appeals … (2) Despite section 60 of the Act, the Appeal Panel for an internal appeal to which this rule applies must apply the first instance costs provisions when deciding whether to award costs in relation to the internal appeal.

Costs under r 38(2)(b) of the NCAT Rules

1. In The Owners Corporation Strata Plan No. 63341 v Malachite Holdings Pty Ltd [2018] NSWCATAP 256 (Malachite Holdings) at [3]-[5], the Appeal Panel summarised the circumstances in which r 38(2)(b) of the NCAT Rules applies: "[3] Rule 38(2)(b) applies to the following proceedings: (1) Where the relief claimed in the proceedings is for an order to pay a specific amount of money, or an order to be relieved from an obligation to pay a specific amount of money, and that amount is more than $30,000; (2) Where an order is sought in the proceedings for the performance of an obligation (such as to do work), and the Tribunal has power make an order to pay a specific amount of money, even if not asked for by the claimant, provided that (a) there is credible evidence relating to the amount the Tribunal could award; and (b) that evidence, if accepted, would establish an entitlement to an order for an amount more than $30,000. [4] Rule 38(2)(b) may also apply to proceedings where the orders sought in the proceedings depend upon the claimant proving there is a debt owed in order to establish an entitlement to the relief sought, and that amount is in dispute and is more than $30,000. [5] Rule 38(2)(b) does not apply to proceedings: (1) Where a claim for relief in the proceedings (not being a claim for an order to be paid or be relieved from paying a specific sum) may, as a consequence of that relief being granted, result in the loss of any property or other civil right to a value of more than $30,000; or (2) Where there is a matter at issue amounting to or of a value of more than $30,000 but: (a) no direct relief is sought and no order could be made in the proceedings requiring payment or relief from payment of an amount more than $30,000; or (b) the relief sought does not depend on there being a finding that a specific amount of money is owed."
2. The general principles concerning the awarding of costs under r 38 of the NCAT Rules were considered by the Appeal Panel in Vella v Mir (No 3) [2020] NSWCATAP 17 (Vella (No 3)) at [28]-[30]: "[28] Clause 38 gives the Tribunal a wide discretion to make an order for costs. It does not specify the factors the Tribunal must take into account in exercising the discretion, although the discretion to make such an order must be exercised judicially: see, for example, Ruddock v Vadarlis [2001] FCA 1865 at [9]. [29] Where an application has been heard and determined on the merits and Clause 38 applies, the appropriate starting point for the exercise of the discretion is not that the parties are to pay their own costs. Rather, it is the well-established position at common law; that is, that the purpose of making a costs order is to provide compensation to the party in whose favour the order is made for the expense the party has been put to in prosecuting or defending legal proceedings. In general terms, this means that a party who is successful is entitled to an order for costs in its favour, subject to exceptions generally involving misconduct on the part of that party: Latoudis v Casey [1990] 170 CLR 534; Oshlak v Richmond River Council [1998] HCA 11. [30] In BNT Constructions Pty Ltd v Allen [2017] NSWCATAP 186 the Appeal Panel, having set aside a costs order made in the Consumer and Commercial Division, decided to re-exercise the costs discretion. Clause 38 was the applicable costs provision in that case. At [67] the Appeal Panel noted the following principles relevant to the exercise of the discretion: (1) the starting point is that a successful party should be entitled to an order for costs in his favour; (2) an award of costs is by way of an indemnity and not as punishment; (3) there is no absolute rule that, absent disentitling conduct, a successful party is to be compensated by the unsuccessful party; (4) the factors to be considered are not to be confined as to do so would constrain the general discretion; (5) the relative success of the parties on different issues and the time taken to determine them may be relevant; (6) the nature of the proceedings is relevant; (7) the proper exercise of the discretion requires a decision maker to do justice between the parties and to exercise the discretion having regard to relevant considerations and in a manner which is not arbitrary and capricious."

Costs under r 38A(2) of the NCAT Rules

1. For the purpose of r 38A of the NCAT Rules the amount claimed or in dispute is the amount in dispute on appeal, not the amount in dispute in the proceedings at first instance: Allen v TriCare (Hastings) Ltd [2017] NSWCATAP 25 at [57].

The submissions of Mr Donohoe

1. In his oral submissions, counsel for Mr Donohoe submitted that costs should follow the event.

The submissions of the Albularios

1. In their reply to appeal, the Albularios made the following submissions in response to the order for the costs of the appeal sought by Mr Donohoe: "● We do not need to give credibility to this kind of shameful intimidation. We are just retirees who want to live our lives in our 2-bedroom retirement home that Mr. Donohoe abandoned. ● For almost four (4) years, we have been throwing money away in amortization, rental and storage expenses, all because Mr. Donohoe did not use the money, we gave him to build our home ● Mr. Donohoe has had other cases against him listed in "NSW FAIR TRADING". ● If need be, we can get names of subcontractors under Mr. Donohoe's employ, who did some work in our house, but were never paid by Mr. Donohoe. These subcontractors are requesting us to be their witnesses for their collecting agents."
2. In their oral submissions, the Albularios opposed the order for the costs of the appeal sought by Mr Donohoe.

Consideration

1. Having regard to the principles in Malachite Holdings at [3(2)], we are satisfied that r 38(2)(b) of the NCAT Rules was applicable to the Tribunal proceedings as the Tribunal had power to make a money order under s 48O(1)(a) of the HB Act.
2. It follows that in circumstances where Mr Donohoe in the appeal was seeking to set aside the 29 April 2024 order, r 38A(2) of the NCAT Rules is applicable to the appeal because the amount in dispute in the appeal is more than $30,000.
3. Having regard to the principles in Vella (No 3) at [28]-[30], we are satisfied that costs should follow the event and accordingly that Mr Donohoe should pay the costs of the appeal of the Albularios as agreed or assessed.

Orders

1. We make the following orders: 1. Leave to appeal is refused. 2. The appellant is to pay the costs of the appeal of the respondents as agreed or assessed.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 28 August 2024