Dyldam Developments Pty Ltd v Mewing

NCAT Appeal Panel|2017-08-14

Introduction

The Civil and Administrative Tribunal of New South Wales has the jurisdiction and the functions conferred by the Civil and Administrative Tribunal Act 2013 (NSW) (the NCAT Act), or any other legislation: s 28 of the NCAT Act. That includes the jurisdiction to hear and determine any "building claim" brought in accordance with Part 3A the Home Building Act 1989 (NSW) (the HB Act), where the amount claimed does not exceed $500,000 or such other prescribed amount: s 48K of the HBA.
The respondents to this appeal, the Mewings, commenced proceedings against the appellant, Dyldam Constructions Pty Ltd (Dyldam) by lodging an application with the Tribunal dated 16 February 2016. By that application, the Mewings claimed payment of a specified sum of money from Dyldam, quantified in the application as being the amount of $500,000, which was said to arise from the supply of building goods and services by Dyldam, in the construction of the Mewings' residence. It follows that: 1. the Mewings' application was a "building claim" as defined in s 48A of the HB Act, within the Tribunal's monetary limit; and 2. the Tribunal had the jurisdiction to hear and determine that claim.
The Tribunal made directions for the filing and service of evidence in the proceedings. The Mewings' served expert evidence that quantified their claim in the amount of $495,587; a figure which the Tribunal appropriately described as "precariously close" to the $500,000 monetary limit in s 48K of the HB Act. The Mewings' came to appreciate that the total amount of their claim would exceed the Tribunal's jurisdiction because the amount in the expert's report did not to include the cost of preliminaries and an allowance for a builder's margin.
The NCAT Act makes provision for the transfer of proceedings in the Tribunal to other courts, either by consent, or on the Tribunal's own motion: cl 6(1) of Sch 4 of the NCAT Act.
On the Mewings' application, on 23 December 2016 the Tribunal made an order that the proceedings to be transferred to the District Court of New South Wales. The Tribunal's reasons for making the order transferring the proceedings states (at [21] of the Reasons) that in their submissions to the Tribunal on the transfer application, the Mewings had notified an intention to amend their application to increase the amount of their claim to include the cost of preliminaries and an allowance for a builder's margin.

The nature of Dyldam's Appeal- Leave to Appeal Required

Internal appeals in the Tribunal are governed by Division 2 of Part 6 of the NCAT Act.
Section 80(1) of the NCAT Act provides that an appeal against an "internally appealable decision" may be made to the Appeal Panel by a party to the proceedings in which the decision was made. For this purpose, an "internally appealable decision" is a decision over which the Tribunal has "internal appeal jurisdiction": s 32(4) of the NCAT Act.
The Tribunal has "internal appeal jurisdiction" over any decision made by the Tribunal in proceedings for a "general decision": s 32(1)(a) of the NCAT Act. Section 29(3) of the NCAT Act defines a "general decision" as "a decision of the Tribunal over which it has general jurisdiction". It follows that the Tribunal's order transferring the proceedings to the District Court of New South Wales is a "decision" made in proceedings for a "general decision", and therefore an "internally appealable decision" within s 80(1) of the NCAT Act.
On 9 February 2017, orders were made by consent for the appeal to be determined on the papers without a hearing. Having regard to the issues raised and the submissions of the parties, we are satisfied that a hearing is not required and have proceeded to determine the application for leave to appeal on the papers as the consent orders envisaged we would do.
Dyldam's Notice of Appeal was filed on 20 January 2017; within the 28 day period for lodging an internal appeal: r 25(4)(c) and r 6(2) of the Civil and Administrative Tribunal Rules, 2014 (NSW).
Courts have traditionally considered appeal rights by reference to the dichotomy between a "final decision" which determines proceedings, and an "interlocutory decision" that does not. The Appeal Panel in Hammond v Ozzy's Cheapest Cars Pty Ltd t/as Ozzy Car Sales [2015] NSWCATAP 65 at [30], has found that s 80(2) of the NCAT Act has replaced this traditional classification by introducing a third category, an "ancillary decision".
An "ancillary decision" is defined in s 4(1) of the NCAT Act as a decision made by the Tribunal under legislation (other than an interlocutory decision of the Tribunal) that is preliminary to, or consequential on, a decision determining proceedings, including: (a) a decision concerning whether the Tribunal has jurisdiction to deal with a matter, and (b) a decision concerning the awarding of costs in proceedings.
This definition makes clear that: 1. a decision is "ancillary" if it is preliminary to, or consequential upon, a decision that determines proceedings; and 2. if a decision is an "interlocutory decision", it cannot be an "ancillary decision".
Relevantly, s 4(1) of the NCAT Act defines " interlocutory decision " as: a decision made by the Tribunal under legislation concerning any of the following: (a) … … (i) any other interlocutory issue before the Tribunal.
The Tribunal's decision to transfer the proceedings to the District Court of New South Wales is a decision that concerns the Tribunal's jurisdiction to hear and determine the Mewings' claim. As such, it may be considered as "a decision concerning whether the Tribunal has jurisdiction to deal with a matter".
This alone is not sufficient to make the decision an "ancillary decision" within the meaning of s 4 of the NCAT Act.
For a decision that concerns the Tribunal's jurisdiction to be an "ancillary decision" it must be one that satisfies the criteria referred to in the opening words of the definition; a decision that is either "preliminary to" or "consequential on" a decision that determines the proceedings.
The Tribunal's order transferring the proceedings to the District Court of New South Wales was not an "ancillary decision". It was not a decision that can be classified as preliminary to a decision that would determine the proceedings. It was not a decision that can be regarded as consequential on a decision that has determined the proceedings. The proceedings continue, albeit in the District Court of New South Wales. We find that the order transferring the proceedings to the District Court of New South Wales was an "interlocutory decision".
Accordingly, Dyldam requires the leave of the Appeal Panel to challenge the Tribunal's order transferring the proceedings.
Part 6 of the Schedule 4 to the NCAT Act provides that an Appeal Panel may grant leave under s 80(2)(b) of the NCAT Act for an internal appeal, only if the Appeal Panel is satisfied that the appellant may have suffered a substantial miscarriage of justice because the decision of the Tribunal appealed against was not fair and equitable (s 12(1)(a) of Schedule 4); or the decision was against the weight of evidence (s 12(1)(b) of Schedule 4); or significant evidence has arisen which was not available at the time the hearing took place (s 12(1)(c) of Schedule 4).

Leave to appeal refused

Dyldam relies on the following legal grounds to support the contention that the Tribunal's order to transfer the proceedings to the District Court of New South Wales was not fair or equitable: firstly, that the Tribunal failed to consider and to apply Schmidt J's decision in Owners Strata Plan No 70030 v Decon Australia Pty Ltd [2014] NSWSC 347; secondly, and allied to the first ground, that the Tribunal misconstrued the jurisdiction conferred on the Tribunal by s 48K of the HB Act.
Dyldam's submissions can be summarised as follows: 1. The Tribunal did not refer to Decon in its reasons; 2. Decon is authority for the proposition that the Tribunal retained jurisdiction over the Mewings' claim which had not been amended prior to the transfer order being made; 3. The Tribunal mistakenly denied it had jurisdiction to determine the proceedings and fell into jurisdictional error; 4. Because the claim had not been amended, in making the transfer order the Tribunal erroneously had regard to the evidence of the value of the claim (which exceeded $500,000) rather than the fact the amount recorded in the Mewings' claim was less than $500,000; and 5. In the absence of a proper consideration of the decision in Decon there was "a 'significant possibility' or 'chance which was fairly open' that a difference and more favourable result (to Dyldam) would have been achieved' and therefore leave to appeal should be granted.
Decon was a case which concerned a building claim lodged in the Consumer Trader and Tenancy Tribunal of New South Wales under s 48K of the HB Act. The plaintiff owners corporation applied to transfer the proceedings claiming that the Tribunal lacked jurisdiction to deal with the claim on the basis that the plaintiff had received an expert report which quantified the claim at more than the $500,000 monetary limit in s 48K of the HB Act.
At the time of the transfer application in Decon, the claim had not been amended to reflect the amount to which the expert evidence referred. When the matter came before the Tribunal, the Tribunal itself raised whether the claim should be struck because of various breaches of the Tribunal's directions. The Tribunal decided to dismiss the plaintiff's claim. It did so without making any decision as to the challenge that the plaintiff had made to the Tribunal's jurisdiction in the transfer application.
Schmidt J's decision in Decon dealt with whether the Tribunal was correct to determine whether it should dismiss the proceedings, in circumstances where the plaintiff was challenging its jurisdiction, and was applying for the proceedings to be transferred. Her Honour decided that the Tribunal was required to consider and resolve whether it had the jurisdiction which it purported to exercise, namely to dismiss the proceedings, and that given the course pursued at the hearing, there had been a denial of procedural fairness in refusing to hear and determine the transfer application, before the matter was dismissed.
In arriving at her decision, Schmidt J considered whether the plaintiff was correct in its challenge to the jurisdiction of the Tribunal by merely asserting that its claim exceeded the monetary limit in s 48K of the HB Act. Her Honour held that the application filed is the foundation of the Tribunal's jurisdiction, and until the application had been amended to claim more than the s 48K monetary limit, the Tribunal continued to have jurisdiction to hear and determine the claim, irrespective of the evidence served (at [60] of the judgment).
In the present case, and having regard to the decision of Decon, the Tribunal had jurisdiction to hear and determine the Mewings' claim against Dyldam at the time the application was lodged, and continued to have jurisdiction to hear and determine the claim until the claim was amended to exceed the Tribunal's jurisdiction. This did not happen.
The Mewings' submissions to the Tribunal suggested that the Tribunal should make an order to amend their application to increase the amount of their claim, but as appears in [21] of the Tribunal's decision, the Tribunal declined to do so. The Appeal Panel does not take the Tribunal as having heard an application to amend the Mewings' claim and exercised a discretion to refuse the amendment. The Tribunal's succinct reasons reflect that the Tribunal declined to consider that the submissions constituted a formal application to the Tribunal for an amendment to the application.
The Tribunal found that the Mewings' claim was very close to the s 48K limit had been "on the record" since they filed had filed their application. The Tribunal's reasons do not make it clear the precise circumstances to which the Tribunal was intending to refer.
The Notice of Appeal refers to the following facts: 1. that the Mewings had filed an expert report with their application which estimated their loss in the amount of $631,961; 2. that at an early stage, when Dyldam raised the issue of the Tribunal's jurisdiction, the Mewings submitted that the Tribunal had jurisdiction to hear and determine their claim because the application itself only claimed an amount within the monetary limit; and 3. that the Mewings served an amended expert report which reduced the quantum of their claim to an amount below the Tribunal's monetary limit.
These were matters that were relevant to any application which the Mewings might have made to amend their claim, but the Tribunal did not determine any application to amend. It had no amendment application before it, other than the suggestion made in the Mewings' written submissions in support of the transfer application. The Appeal Panel considers that the Tribunal's decision to transfer the proceedings in the exercise of the Tribunal's discretion was not predicated on a misunderstanding of the Tribunal's jurisdiction, nor on the basis that the Tribunal did not have jurisdiction to deal with the matter. It appears to us from the Tribunal's reasons that the Tribunal was motivated in transferring the proceedings to the District Court of New South Wales by the following factors: 1. the fact that the Mewings' had come to the realisation that the expert evidence as to the quantum of their claim did not include preliminaries and a builder's margin; 2. the Mewings' desire to seek to amend the quantum of their claim to an amount which would exceed the jurisdiction of the Tribunal, if the amendment were successful; and 3. the Tribunal's implicit view that the Mewings' application to amend their claim was best to be considered by the court that, in the event of the application's success, would retain the jurisdiction to hear and determine the claim.
We consider that unless Dyldam demonstrates that the Tribunal made an error of legal principal, or material fact, or took into account irrelevant considerations, or failed to give sufficient weight to some relevant matter to justify the Appeal Panel's intervention, Dyldam's challenge to the decision to transfer the proceedings should fail: see House v The King [1936] HCA 40; (1936) 55 CLR 499 at 504-5. We do not consider it sufficient for Dyldam to merely demonstrate that the Tribunal was arguably wrong in the exercise of discretion.
The Tribunal determined that the matter had not been fixed for hearing and while the claim had not been formally amended, the Mewings wished to pursue a claim that their expert quantified as more than $500,000. Nothing in the NCAT Act or the HB Act prevents the Tribunal from exercising a discretion to transfer proceedings to a court having jurisdiction to determine such a claim in accordance with cl 6 of Sch 4 of the NCAT Act in such circumstances. Decon is not a decision to the contrary.
Consistent with the principals relating to leave to appeal as summarised by the Appeal Panel in Collins v Urban [2014] NSWCA TAP 17 at [84] the grant of leave to appeal in an interlocutory decision involves a consideration as to whether the decision in question involved an issue of principal, a question of public importance, an injustice which is reasonably clear, a factual error that was unreasonably arrived at and clearly mistaken, or that the Tribunal having gone about the facto 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 an interest of justice for it to be reviewed. This is a significant hurdle to overcome by any applicant seeking to obtain leave to appeal.
We must be satisfied that the decision transferring the proceedings to the District Court disclosed legal error that gave rise to an injustice which is reasonably clear, or produced a result that it was so unfair it would in the interests of justice that the decision be reviewed.
We are not satisfied there is any error in the present case. Rather, the transfer order made will facilitate the just, quick and cheap resolution of the real issues in dispute.
The interests of justice do not warrant the Appeal Panel overturning the Tribunal's order. The proceedings will continue in a court that has the jurisdiction to both deal with an application to amend the claim, and to then retain the matter irrespective of the outcome of that application.
Finally, while the Tribunal refused to make any order for costs, in so far as there are wasted costs arising from any amendment or otherwise relating to the proceedings in consequence of the transfer order, these matters can be dealt with by the court as it sees fit.

Conclusion

The Dyldam challenge does not demonstrate the Tribunal made any error of law in the exercise of its discretion to transfer the proceedings to the District Court of New South Wales. The Appeal Panel finds nothing in the reasoning of the Tribunal that establishes that the Tribunal misconceived the Tribunal's jurisdiction, or failed to consider the exercise of discretion on proper grounds, or on the erroneous belief that the Tribunal did not retain the jurisdiction to determine the claim as the original application had not been amended.

Costs

The appeal involves an appeal from a decision in proceedings in which r 38 applies as the amount claimed is greater than $30,000. Consequently, r 38A applies to this appeal and there is a general discretion as to costs.
As the appellant has been unsuccessful, prima facie costs should follow the event and an order should be made to this effect.
If either party contends to the contrary, submissions can be made.

Orders

Accordingly, the Appeal Panel makes the following orders: 1. Leave to appeal is refused and the appeal is otherwise dismissed. 2. Subject to orders 3 and 4, the appellant is to pay the respondents' cost of the appeal. 3. In the event either party contends that a different costs order should be made to that in order 2, the following directions apply: 1. the party contending for a different costs order (costs applicant) is to file and serve any submissions within 7 days after the date of these orders; 2. the cost respondent is to file and serve any submissions in response 14 days after the date of these orders; 3. the costs applicant is to file and serve any submissions in reply 21 days after the date these orders; 4. the submissions are to include submissions as to power to award costs and whether an order should be made dispensing with a hearing of any cost application pursuant to s 50(2) of the Civil and Administrative Tribunal Act, 2013. 1. Order 2 ceases to have effect if either party files and serves submissions contending that a different costs order should be made in accordance with order 3(a).

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: 14 August 2017

At a glance

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Judgment (7 paragraphs)

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Legislation Cited (2)

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Cited By (3)