Florida Kitchens Pty Ltd v No 1 Cutting Service Pty Ltd

NCAT Appeal Panel|2018-09-27

Solicitors: Cadmus Lawyers (Appellant) S R Law (Respondent) File Number(s): AP 18/30904 Publication restriction: Nil Decision under appeal Court or tribunal: New South Wales Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Citation: N/A Date of Decision: 5 December 2017 (Principal decision), 12 June 2018 (Costs decision) Before: G Meadows, Senior Member File Number(s): HB 16/49419

Introduction

This is an internal appeal from two decisions of a Senior Member in the Consumer and Commercial Division of the Tribunal delivered on 5 December 2017 and 12 June 2018.
By the first decision (the liability decision) the Senior Member ordered the appellant, the respondent at first instance, to pay the respondent, the applicant at first instance, the sum of $20,130. That sum was found to be due in respect of the manufacture and installation by the respondent at the request of the appellant of Caesarstone bench tops and splashbacks at three building sites.
By the second decision (the costs decision) the Senior Member ordered the appellant to pay the respondent's costs of the proceedings at first instance on an indemnity basis as agreed or assessed.
For ease of reference, we will refer to the appellant as Florida Kitchens and the respondent as No 1.

Extension of time

By virtue of rule 25(4)(c) of the Civil and Administrative Tribunal Rules 2014 (NSW) an appeal made against a decision of the Tribunal must be lodged "within 28 days from the day in which the appellant was notified of the decision to be appealed or given reasons for the decision (whichever is the later)".
Florida Kitchens filed its Notice of Appeal on 10 July 2018.
That date was within the 28 days of the costs decision of 12 June 2018. It was over seven months after the liability decision of 5 December 2017.
Mr Milanovic of counsel, who appeared for Florida Kitchens, submitted that, for the purposes of rule 25(4)(c), the relevant date in respect of both decisions was the date on which Florida Kitchens received notice of the costs decision.
Mr Milanovic did not point to any authority in support of that proposition and in our view it is clearly incorrect. The substantive decision was a final and enforceable decision. The decision stood independently of any subsequent decision concerning the costs of the proceedings.
There is no warrant in the words of rule 25 for the construction of that rule propounded by Mr Milanovic. The rule does not refer to "the finalisation of proceedings". It refers to "the decision to be appealed" and "reasons for the decision".
Accordingly, Florida Kitchens' appeal in respect of the liability decision was filed out of time, and, unless we grant an extension of time, must be dismissed.
In its Notice of Appeal Florida Kitchens sought an extension of time to the extent that an extension was necessary. In support of that application Florida Kitchens referred to correspondence forwarded to the Tribunal and No 1's solicitors, dated respectively 29 December 2017 and 2 January 2018, in which Florida Kitchens' solicitor recorded that Florida Kitchens had paid the judgment sum "under protest, and with our client reserving all its rights in the matter".
Florida Kitchens submitted that the appeal was not lodged within 28 days of 5 December 2017 for the following reasons set out in its written submissions: 1. The timing of the judgment coincided with the Christmas and New Year's break. 2. The Appellant paid the amount of $20,130.00 on 29 December 2017, in order to comply with the Order and not to have an adverse listing of non-compliance with an NCAT Order with the NSW Fair Trading. 3. The Appellant wrote to the Tribunal on 29 December 2017 and the Respondent on 2 January 2018, confirming that the payment of $20,130.00 was made under protest, and the Appellant reserving all its rights in relation to the matter. 4. The Respondent wrote to the Appellant on 10 January 2018 confirming the receipt of the sum of $20,130.00 and advising that they will make an application for costs, if the Appellant does not agree to pay the Respondent's costs. 5. As a result, the Appellant was awaiting the outcome of the Tribunal's position in relation to costs for finality purposes, in lieu of having 2 potential appeals lodged and dealt with separately with additional time and costs involved.
Apart from the correspondence referred to, Florida Kitchens did not seek to lead any evidence to establish the matters set out in its submissions as extracted above.
We note that No 1's solicitor's letter to Florida Kitchens' solicitor raising the issue of costs (Item 4 set out above) occurred after the expiry of the time for appeal on 2 January 2018. The suggestion that Florida Kitchens was awaiting the outcome of No 1's costs application cannot explain the failure of Florida Kitchens to lodge its appeal within the time specified in rule 25(4)(c).
The power to grant an extension of time arises pursuant to s 41 of the Civil and Administrative Tribunal Act 2013 (NSW) which provides: 41 Extensions of time (1) The Tribunal may, of its own motion or on application by any person, extend the period of time for the doing of anything under any legislation in respect of which the Tribunal has jurisdiction despite anything to the contrary under that legislation. (2) Such an application may be made even though the relevant period of time has expired.
In Habib v State of New South Wales (NSW Police Force) [2014] NSWCATAP 70 an Appeal Panel stated: 72 The discretionary power to grant an extension of time under s 41 of the Act is unfettered but it must be exercised judicially and having regard, among other things, to s 36 of the Act and the need "to facilitate the just, quick and cheap resolution of the real issue in the proceedings". 73 The discretion to extend time is given for the sole purpose of enabling the Tribunal, in this case the Appeal Panel, to do justice between the parties. In order to determine whether the rules will work an injustice, it is appropriate to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation and the consequences for the parties of the grant or refusal of the application for extension of time. It is also appropriate to consider the prospects of the appellant succeeding in any application for leave to appeal and on the appeal itself. In order to justify the Appeal Panel extending the time, there must be some material upon which the Appeal Panel can exercise its discretion. See Nanschild v Pratt [2011] NSWCA 85 at [38]; Gallo v Dawson [1990] HCA 30, 93 ALR 479 at [2] and the authorities referred to there; and also Opera Australia Ltd v Carr [1999] NSWADTAP 6 at [16] and Chand v Rail Corporation of New South Wales No 3 [2010] NSWADTAP 11 at [20]. 74 Time limits are set to promote the orderly and efficient conduct of proceedings in the Tribunal, to provide certainty for the parties to proceedings and to achieve finality in litigation. For these reasons, time limits should generally be strictly enforced unless the interests of justice require that an extension be granted.
The relevant considerations in determining whether to grant an extension of time to lodge a Notice of Appeal were set out by an Appeal Panel in Jackson v Land and Housing Corporation [2014] NSWCATAP 22 at [22]: (1) The discretion can only be exercised in favour of an appellant upon proof that strict compliance with the rules will work an injustice upon the Appellant Gallo v Dawson [1990] HCA 30, 93 ALR 479 at [2], Nanschild v Pratt [2011] NSWCA 85 at [38]; (2) The discretion is to be exercised in the light of the fact that the Respondent (to the appeal) has already obtained a decision in its favour and, once the period for appeal has expired, can be thought of as having a "vested right" to retain the benefit of that decision Jackamarra v Krakouer (1998) 195 CLR 516 at [4], Nanschild v Pratt [2011] NSWCA 85 at [39] and, in particular, where the right of appeal has gone (because of the expiration of the appeal period) the time for appealing should not be extended unless the proposed appeal has some prospects of success Jackamarra at [7]; (3) Generally, in an application for an extension of time to appeal the Appeal Panel will be required to consider: (a) The length of the delay; (b) The reason for the delay; (c) The Appellant's prospects of success, that is usually whether the appellant has a fairly arguable case; and (d) The extent of any prejudice suffered by the Respondent (to the appeal): - Tomko v Palasty (No 2) (2007) 71 NSWLR 61at [55] (per Basten JA) but note also [14], Nanschild v Pratt [2011] NSWCA 85 at [39] to [42]; and (4) It may be appropriate to go further into the merits of an appeal if the explanation for the delay is less than satisfactory or if the opponent has a substantial case of prejudice and, in such a case, it may be relevant whether the Appellant seeking an extension of time can show that his or her case has more substantial merit than merely being fairly arguable Tomko v Palasty (No 2) (2007) 71 NSWLR 61 at [14] (per Hodgson JA, Ipp JA agreeing at [17]) and Molyneux v Chief Commissioner of State Revenue [2012] NSWADTAP 53 at [58] [59].
In this case the delay is considerable and the explanation of the reason for the delay is not convincing. On the other hand, No 1 does not point to any particular prejudice arising from the delay, beyond the delay itself.
In circumstances where "the explanation for the delay is less than satisfactory" it may be appropriate to go further into the merits of the appeal (see Jackson at 22).
As, for the reasons we set out below, we have concluded that the outcome of the proceedings would not change if an extension of time were granted, we decline to grant an extension of time and accordingly Florida Kitchens' appeal in respect of the liability decision will be dismissed.

Grounds of Appeal

Florida Kitchens' Notice of Appeal set out 36 grounds of appeal. In order to understand those 36 grounds it is necessary to have regard to Florida Kitchens' written submissions. Assisted in that manner, it is possible to identify that 8 grounds (Grounds 22 to 29) relate solely to the costs decision and that the remaining grounds can be grouped into categories. We will address the grounds by reference to those categories rather than by reference to individual grounds.
The categories into which we group Florida Kitchens' grounds of appeal are:

Group A - Failure to provide sufficient or proper reasons (Grounds 1 and 21)
Group B - Denial of procedural fairness in the conduct of the hearing (Ground 2)
Group C - Denial of procedural fairness through actual and apprehended bias (Grounds 8 and 9)
Group D - Failure to deal with the case put by Florida Kitchens, in particular failing to consider or apply the relevant provisions of the Home Building Act 1989 (NSW) (Grounds 3 to 7 and 33)
Group E - Making findings without evidence (Grounds 16, 17, 30, 31, 35 and 36)
Group F - Making inconsistent findings (Ground 18)
Group G - Taking into account irrelevant matters (Grounds 14 and 15)
Group H - various challenges to the Member's conclusions and specific factual findings and observations of the Member as being against the weight of the evidence (Grounds 10 to 13, 19 and 32)
Group I - Costs (Grounds 22 to 29)
Group J - Two grounds not falling within any of the previous groups (Grounds 20 and 34).

It is convenient to address Group J, Grounds 20 and 34 immediately.
By Ground 20 Florida Kitchens asserted that the Member failed to take into account the submissions of Florida Kitchens. We note that, although failing to take submissions into account might constitute an error on the part of the Member, Ground 20 does not identify what submissions were not taken into account. Florida Kitchens' written submissions merely refer to the whole of the submissions presented to the Member. The ground adds nothing to the other grounds of appeal. Mr Milanovic did not submit any argument to suggest otherwise.
By Ground 34 Florida Kitchens asserted that the Member erred in "finding that the directors of the appellant had to give evidence". We observe that the Member made no such finding. Rather the Member observed (at [57]) that Mr Andre Elias, "the sole director and shareholder of Florida Kitchens" had not given evidence and "it would be expected that [he] would be in the best position to provide evidence as to whether his company had contracted with [No 1] or not" and observed that no explanation had been offered for Mr Elias' failure to give evidence.
The Member did not in the liability decision explicitly base any conclusion upon the absence of evidence from Mr Andre Elias. It was not necessary for him to do so as he accepted the evidence of Mr Hoang, the project manager of No 1, concerning his communications with Mr Andre Elias. Nevertheless, in an orthodox application of the principle expressed in Jones v Dunkel (1959) 101 CLR 298, the Member more readily accepted the evidence of Mr Hoang and drew inferences adverse to Florida Kitchens by reason of its failure to call Mr Elias. We find no error in the Member's approach to the absence of evidence from Mr Elias.

Scope and nature of internal appeals

Pursuant to s 80 of the Civil and Administrative Tribunal Act (NCAT Act) an appeal against a decision of the Tribunal may be brought as of right on a question of law or by leave of the Appeal Panel on other grounds.
As this appeal is brought from a decision of the Consumer and Commercial Division of the Tribunal, pursuant to clause 12 of Schedule 4 to the NCAT Act, leave to appeal may be granted only if the Appeal Panel is satisfied the appellant may have suffered a substantial miscarriage of justice because: 1. the decision of the Tribunal under appeal was not fair and equitable, or 2. the decision of the Tribunal under appeal was against the weight of evidence, or 3. significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with.
We note that the alleged errors raised by the grounds we have categorised as Groups A to E would, if established, constitute errors of law: see Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69 at [13]. Therefore, were we to grant Florida Kitchens an extension of time, Florida Kitchens may raise the grounds constituting Groups A to E without the leave of the Appeal Panel.
The grounds constituting Groups F and G may also raise questions of law.
The grounds we have enumerated as Group H raise challenges to findings of fact on the part of the Senior Member as being against the weight of evidence. As such Florida Kitchens would require the leave of the Appeal Panel to raise these grounds.

Background to the Proceedings

Before we turn to deal with the grounds of appeal we have identified as Groups A to I, it is necessary to set out further details of the background to the proceedings.
The amount claimed by and awarded to No 1 reflected three invoices issued by No 1 in respect of three building sites at Bondi Junction, Vaucluse and Allawah. The invoices were for amounts of $14,190, $2,090 and $3,850 respectively.
The proceedings were initially commenced in the Local Court of New South Wales and the issues on the application were defined by pleadings filed in that Court before the proceedings were transferred to the Tribunal.
No 1 alleged that Mr Andre Elias, who Florida Kitchens admitted was its sole director and shareholder, had sought quotations for the three jobs from Mr Hoang, the project manager for No 1. In respect of the Bondi Junction job Mr Andre Elias sought a quotation by telephone on 25 February 2016. In respect of the Vaucluse and Allawah jobs Mr Andre Elias sought quotations by two separate emails sent on 1 March 2016.
No 1 alleged that it provided quotations in the amounts subsequently invoiced, that those quotations were accepted, that No 1 had carried out the work the subject of the quotations and that No 1 had not been paid.
Florida Kitchens did not dispute that No 1 had carried out the work the subject of the invoices but asserted that No 1 had not done so pursuant to any contract with Florida Kitchens. Florida Kitchens asserted that No 1 had entered into a contract or contracts with Florida Kitchen Centre Pty Ltd, a different company.
It was not in dispute that Florida Kitchen Centre Pty Ltd had changed its name to ACN 121405203 Pty Ltd on 9 February 2016, that a liquidator had been appointed to that company on 10 March 2016, and that Andre Elias had not at any time been a director or shareholder of that company.
Evidence produced on summons by Combuild Australia Pty Ltd (Combuild) disclosed that Florida Kitchens had issued tax invoices to Combuild in respect of the installation of kitchens and vanities at the Bondi Junction address where No 1 had installed benchtops.
In respect of each job Mr Andre Elias had sent emails to Mr Hoang. The name "Florida Kitchens" appeared at the foot of each email.
The drawings provided to No 1 showing the dimensions of the benchtops bore the name "Florida Kitchen Centre".
Mr Hoang gave evidence of his involvement in the three jobs and his correspondence with Mr Andre Elias. Mr Andre Elias did not give evidence, nor did any employee of Florida Kitchens or any person associated with Florida Kitchen Centre Pty Ltd.
The only witness from whom Florida Kitchens provided evidence was Mr Ferrante, an employee of Combuild, who was project manager and building site foreman at the Bondi property. Mr Ferrante provided a statement in which he stated that he had "observed individuals from Florida Kitchen Centre carrying out kitchen and vanity works on the construction site" at Bondi. He also gave evidence of a conversation with Mr Hoang alleging that Mr Hoang had referred to Florida Kitchen Centre and the fact that it had gone into liquidation.
Mr Hoang denied that conversation. Mr Hoang gave oral evidence and was cross examined.
Mr Ferrante did not give oral evidence and was not made available for cross examination. Mr Ferrante's evidence (excluding one sentence) was admitted into evidence, subject to weight, over the objection of Mr Bell, counsel for No 1.
Florida Kitchens also sought to defend the claim of No 1 on the bases that: there was no written contract complying with Section 7 of the Home Building Act; that No 1 had not obtained a policy of Home Owners Warranty Insurance pursuant to Section 92 of the Home Building Act in respect of the work; and that No 1 was not licensed under the Home Building Act to carry out the work.
At paragraphs [47]-[58] of the liability decision the Member determined that No 1 had contracted with Florida Kitchens to carry out the work, the subject of the invoices.
The Member reached that conclusion: 1. because the documents produced by Combuild demonstrated that that company had been invoiced for the work by Florida Kitchens, not by Florida Kitchen Centre Pty Ltd and the Member was persuaded that Florida Kitchens had contracted directly with Combuild for the work; and 2. because the communications with Mr Hoang concerning the three jobs came from Mr Andre Elias, the sole director of Florida Kitchens, and included email communications bearing the name "Florida Kitchens".
The Member noted that Andre Elias would be in the best position to provide evidence as to whether Florida Kitchens contracted with No 1 and that no explanation had been offered for his failure to give evidence.
The Member recorded that the fact that the plans provided to Mr Hoang to enable him to quote for the jobs bore the name "Florida Kitchen Centre" did not require a different conclusion.
The Member recorded (at [53]): "it is of course extremely common for a builder to be engaged to construct works prepared by a suitably qualified and experienced company".
The Member noted that No 1 alleged, in the alternative, that it was entitled to payment on a quantum meruit basis. No 1 had led evidence from Mr Heyman, a quantity surveyor, in support of its claim. Mr Heyman was cross examined on his evidence and conceded that he had no experience in relation to cutting or installing marble or stone fittings.
The Member concluded that Mr Heyman's evidence was "not satisfactory" and instead assessed the value of the work provided by No 1 by reference to the invoices issued by No 1 (which we note reflected the prices accepted by Mr Andre Elias). The Member noted that Florida Kitchens had not led any evidence disputing or challenging the amounts included in the tax invoices and stated at [68]: "[Florida Kitchens'] case was limited entirely to attempting to prove the wrong party had been sued, apart from the cross examination of Mr Heyman."
We now turn to address the Groups of Grounds of Appeal we have identified above.

Group A - Inadequate Reasons - Grounds 1 and 21

As the Court of Appeal stated in Pollard v RRR Corporation Pty Ltd [2009] NSWCA 110 at [57]-[59]: 57 The giving of adequate reasons lies at the heart of the judicial process. Failure to provide sufficient reasons promotes "a sense of grievance" and denies "both the fact and the appearance of justice having been done", thus working a miscarriage of justice: …. 58 The extent and content of reasons will depend upon the particular case under consideration and the matters in issue…. While a judge is not obliged to spell out every detail of the process of reasoning to a finding … it is essential to expose the reasons for resolving a point critical to the contest between the parties: … 59 The reasons must do justice to the issues posed by the parties' cases…. Discharge of this obligation is necessary to enable the parties to identify the basis of the judge's decision and the extent to which their arguments had been understood and accepted: … it is necessary that the primary judge "'enter into' the issues canvassed and explain why one case is preferred over another" …[citations omitted].
Florida Kitchens' written submissions make the general assertion that the reasons provided for the Member's decisions were inadequate. This is insufficient of itself to identify a question of law. The written submissions only identified two particular respects in which Florida Kitchens submitted the reasons were insufficient.
First, Florida Kitchens submitted that the Member failed to consider the defences raised by Florida Kitchens and "failed to identify and apply the Home Building Act".
Florida Kitchens is correct in stating that the Member did not address the defences raised by Florida Kitchens under the Home Building Act, that is the absence of a written contract, the fact that No 1 was not licensed and the absence of Home Owners Warranty Insurance. However the Member did assess the amount due to No 1 on the basis of a quantum meruit. This suggests that the Member considered that, to the extent that the defences had merit, they did not ultimately affect the result of the decision.
Although we consider that the Member's reasoning in this regard is not clearly expressed, for reasons we will address in considering the grounds of appeal in Group D, we consider that the Member's conclusion was correct and that even if the appeal were to succeed on this ground, the dispute would ultimately be resolved in the same way. In those circumstances it would be inappropriate to grant an extension of time to lodge the appeal by reason of this ground alone.
The second basis upon which Florida Kitchens submitted that the Member's reasons were inadequate arose from a comment made by the Member in his costs decision that: "I gave detailed oral reasons at the conclusion of the hearing today. These written reasons summarise, but do not replace, those oral reasons."
Following the hearing and determination of No 1's application for costs on 12 June 2018, Florida Kitchens' solicitor wrote to the Tribunal on 26 June 2018 asking: "Would you please confirm as to when Tribunal Member G Meadows will provide the full written reasons, as he indicated on 12 June 2018 that he will provide the written reasons by the afternoon of 12 June 2018."
The Registrar responded on 9 July 2018: "Reference is made to your request received on 28 June 2018 and 2 July 2018 for written reasons for the decision made on 12 June 2018 at Sydney. It is noted that the orders issued to you included reasons prepared by the Member which satisfy the requirements of Section 82(2) of the NSW Civil & Administrative Tribunal Act 2013. The Presiding Member has advised that no further reasons are available. You may consider making a written request to purchase a copy of the sound recording of the hearing which include the detailed oral reasons given at the conclusion of the hearing."
Although Florida Kitchens included in its appeal bundle a full transcript of the main hearing on 11 August 2017, it did not provide a transcript of the costs hearing.
By directions in relation to the appeal made on 26 July 2018 Florida Kitchens was directed to lodge with the Tribunal: "the sound recording of the hearing at first instance, if oral reasons were given and/or what happened at the hearing is being relied on, and a typed copy of the relevant parts".
Florida Kitchens did not provide a typed copy of any part of the hearing on 12 June 2018 and did not identify either in its written submissions or in oral argument whether any oral reasons given at the hearing differed in substance from the written reasons delivered on 12 June 2018.
Florida Kitchens does not point to any respect in which the written reasons for the costs decision given on 12 June 2018 were inadequate. In our view the written reasons set out the Member's findings on material questions of fact, his understanding of the relevant law and his reasoning process (see s 62(3) of the NCAT Act). Accordingly we are not persuaded that there was any error of law through the provision of inadequate reasons in respect of the costs decision of 12 June 2018.

Group B - Denial of Procedural Fairness in the conduct of the hearing - Ground 2

Florida Kitchens submitted that the Member denied it procedural fairness in the course of the hearing by intervening to stop the cross examination of Mr Hoang "in relation to essential issues and contentious matters going to credit and legal issues in the matter". Florida Kitchens also submitted that the Member was "pressing for the matter to be concluded, denying the appellant the right to properly present its case and cross examine the respondent's witness".
The Member set out in his liability decision of 5 December 2017 at [59] and [60] his reasons for disallowing a line of cross examination of Mr Hoang. Those reasons were that Mr Hoang was being cross examined in relation to a suggestion that Mr Hoang: "knowing he had contracted with [Florida Kitchen Centre]…finding that [Florida Kitchen Centre] had gone into administration or liquidation but that [Florida Kitchens] was still registered and operating, had decided, together with his solicitor, that it would be to his benefit to sue [Florida Kitchens] although he knew he had not contracted with [Florida Kitchens]."
The Member pointed out, correctly in our view, that this line of cross examination amounted to a claim that Mr Hoang and his solicitor had deliberately lodged a fraudulent claim. The Member noted that that was a serious allegation which should not be made without some basis in the evidence.
Mr Milanovic on behalf of Florida Kitchens denied that such an allegation was being made.
The Member declined to permit the line of cross examination of Mr Hoang to continue. We see no error in that course. If the allegation was not being made that Mr Hoang had deliberately commenced proceedings against the wrong party, the line of questioning had no relevance to the issues to be determined in the proceedings.
Subject to the overriding requirement that the parties be accorded procedural fairness (Bezzina v Nigel [2016] NSWCATAP 45 at [35]), s 38 of the Civil & Administrative Tribunal Act provides the Tribunal with a broad degree of discretion in the conduct of proceedings. Although the denial of an opportunity to cross examine may in some circumstances constitute a denial of procedural fairness (see Gallo v Duflou [2014] NSWCATAP 115 at [21]), it is not a denial of procedural fairness to reject questions or terminate cross examination which is improper or irrelevant.
In our view the Member's intervention was appropriate and unobjectionable. Florida Kitchens was not denied procedural fairness through being unable to continue the line of cross examination which, we note, had already continued for some time.
In the course of oral submissions Mr George Elias, solicitor for Florida Kitchens, who presented argument on behalf of Florida Kitchens on the appeal grounds relating to alleged breaches of procedural fairness, referred to three particular passages in the transcript of the hearing in which the Member referred to the passage of time and the fact that the case needed to be completed by 4.15 pm. In our view those comments were entirely unexceptionable and were no more than appropriate reminders to the parties that the matter was required to conclude by 4.15 pm on the day of the hearing.
We also note that on page 85 of the transcript (at Tab 21 of Florida Kitchens' appeal bundle) Mr Bell made the submission that the cross examination of Mr Hoang should be cut short as it was a waste of time. The Member indicated that he would allow the cross examination to continue "for the moment" but reminded Mr Milanovic that the matter needed to conclude that day. At that point Mr Milanovic indicated he had no further questions of Mr Hoang.
We are unable to conclude that Mr Milanovic was denied the opportunity to ask Mr Hoang any relevant questions he may have considered appropriate.
Florida Kitchens did not identify any other respect in which it asserted that it was denied a full opportunity to present its case. This ground of appeal could not succeed.

Group C - Alleged bias and apprehended bias - Grounds 8 and 9

Following the Member's interruption of the cross examination of Mr Hoang and his ruling that Florida Kitchens should not continue with the particular line of cross examination, Mr Milanovic applied for the Member to disqualify himself on the ground of bias. The Member recorded in his decision that Mr Milanovic did not make it clear whether he alleged actual or apprehended bias.
Apprehended bias arises when a fair-minded and reasonably well-informed observer might conclude that a decision maker might not approach an issue with an open mind: Aronson, Groves & Weeks, Judicial Review of Administrative Action and Government Liability 6th ed. 2017, at 652 [9.30] and 665 to 666 [9.80].
When the Member sought clarification of the basis of the application, Mr Milanovic deferred to his instructing solicitor, Mr George Elias. At the appeal hearing Mr Milanovic again left the submissions concerning this ground of appeal to Mr Elias.
The Member recorded in his decision that Mr Elias suggested that he or his firm had reported the Member to ICAC but provided no details of the subject matter of the report.
The Member further recorded that he had informed Mr Milanovic and Mr George Elias that he had no memory of any previous proceedings involving Florida Kitchens or any associated company and that he specifically had no knowledge of any complaint to ICAC or to the Tribunal. The Member declined to disqualify himself.
Florida Kitchens' submissions to the Appeal Panel on this topic suggested that the Member showed bias through intervening in the cross examination of Mr Hoang. As we have recorded above, we consider that this intervention was justified and appropriate and we do not consider it demonstrated bias either actual or apprehended.
Florida Kitchens also pointed to a number of matters which it claimed to have raised before the Member and which it alleged demonstrated bias. It is not necessary to repeat the details of those matters but we note that: 1. Two of the matters raised relate to Florida Kitchen Centre Pty Ltd, not Florida Kitchens, although Florida Kitchen Centre was represented by Mr George Elias in relation to those matters; 2. The other matters raised related to two costs assessments referred to the Member in his capacity as a costs assessor under the Legal Profession Act 2004 (NSW). Florida Kitchens was not involved in any way in either of those assessments. Mr George Elias was a respondent to each assessment application and successfully applied to have the Member's appointment revoked on the ground that another costs assessor was already dealing with related applications.
We make a number of observations about these submissions. 1. It is not clear that the costs assessment issue was raised with the Member at the hearing. It cannot be suggested that it was something Mr George Elias only became aware of after the hearing. 2. It is not clear how Florida Kitchens submits that any of the matters could give rise to an apprehension of bias against Florida Kitchens. None of the matters involved Florida Kitchens in any way. 3. These are not matters that arose in the course of the hearing. They must have been known to Mr George Elias at the commencement of the hearing. An application for disqualification should be made promptly: Brown Bros v Pittwater Council [2015] NSWCA 215 at [142]-[143]; Michael Wilson & Partners v Nicholls (2011) 244 CLR 427 at [76]. By failing to take objection to the Member hearing the matter at the commencement of the hearing, Florida Kitchens must be taken to have waived any objection arising from the matters of which its legal representative was aware.
We do not consider that the matters raised by Florida Kitchens demonstrate bias. There was no basis upon which it could be suggested the Member held an actual bias against Florida Kitchens. A fair-minded and reasonably well-informed observer would not conclude, on the basis of the matters raised by Florida Kitchens, taken separately or together, that the Member would not approach the consideration of the issues in the proceedings with an open mind. These grounds of appeal could not succeed.

Group D - Failing to deal with issues raised - Grounds 3 to 7 and 33

Florida Kitchens submitted that the Member had not dealt with the defences it had raised under the Home Building Act. Those defences were, as noted above: 1. That there was no written contract; 2. That No 1 was unlicensed; and 3. That No 1 had not obtained Home Owners Warranty Insurance in respect of the work.
Florida Kitchens submitted that by reason of the provisions of ss 4, 7, 10, 92 and 94 of the Home Building Act, No 1 was not entitled to enforce any contract against Florida Kitchens in respect of the work, the subject of the proceedings.
Section 4 provides that a person must not contract to do any residential building work except as or on behalf of an individual, partnership or corporation that is the holder of a contractor licence authorising its holder to contract to do that work.
Section 7 requires that a contract for residential building work must be in writing, signed by or on behalf of each of the parties to it and contain prescribed details including the name of the holder of the contractor licence and a sufficient description of the work to which it relates. The section is only applicable to contracts where the contract price is $20,000 or more (s 7(1A) and regulation 5(1)(b) of the Home Building Regulation 2014 (NSW)).
Section 10 provides that a person who contracts to do any residential building work in contravention of section 4, or under a contract to which the requirements of section 7 apply, that is not in writing or that does not have a sufficient description of the work to which it relates, is not entitled to damages or to enforce any other remedy in respect of a breach of the contract committed by any other party to the contract, and that the contract is unenforceable by the person who contracted to do the work.
Section 92 provides that a person must not do residential building work under a contract, or demand or receive a payment under a contract for residential building work, unless a contract of insurance that complies with the Home Building Act is in force in relation to that work in the name under which the person contracted to do the work, and a certificate of insurance evidencing the contract of insurance, in a form prescribed by the regulations, has been provided to the other party (or one of the other parties) to the contract.
Section 94 relevantly provides: 94 Effect of failure to insure residential building work (1) If a contract of insurance required by section 92 is not in force, in the name of the person who contracted to do the work, in relation to any residential building work done under a contract (the uninsured work), the contractor who did the work: (a) is not entitled to damages, or to enforce any other remedy in respect of a breach of the contract committed by any other party to the contract, in relation to that work, and (b) is not entitled to recover money in respect of that work under any other right of action (including a quantum meruit). (1A) Despite section 92 (2) and subsection (1), if a court or tribunal considers it just and equitable, the contractor, despite the absence of the required contract of insurance, is entitled to recover money in respect of that work on a quantum meruit basis.
As noted above, we agree that the Member's reasons for decision did not sufficiently address these defences. Nevertheless, as we foreshadowed above, we consider that the Member's decision was clearly correct.
It is apparent that the Member addressed the statutory defences by considering the outcome of No 1's application on the assumption that the statutory defences were upheld. The Member assessed the amount payable to No 1 on the basis of a quantum meruit. Subject to one reservation which we address below, that approach is consistent with a finding that the statutory defences were made out.
In circumstances where the Home Building Act prevents a person who has carried out residential building work from recovering under a contract in respect of that work, provided the party sued in respect of the building work has asked for and received the benefit of the work, it is appropriate to award, by way of restitution or on a quantum meruit, the fair and reasonable value of the work (Pavey v Matthews (1987) 162 CLR 221; O'Connor v LEAW Pty Ltd (1997) 42 NSWLR 285).
We note that the alternative claim to recover the value of the work on a quantum meruit was explicitly canvassed in submissions before the Member. The Member did not specifically address the requirements of free acceptance and benefit which are essential elements of such a claim but, in our view, those elements were manifestly apparent in this case. Once the Member found that No 1 had contracted with Florida Kitchens, it followed that Florida Kitchens had requested the work which No 1 had performed and that it had received the benefit of it. The evidence indeed specifically disclosed that Florida Kitchens had been paid by Combuild for the installation of kitchens and vanities at the Bondi site.
The Member assessed the fair and reasonable value of the work by reference to the agreed price. A contract price agreed between the parties may be evidence of the value of the work the subject of the contract: Sopov v Kane Constructions Pty Ltd [No.2] (2009) 24 VR 10 at [21]; Nayak v Rockwall Constructions [2017] NSWCATAP 18 at [76]-[77].
In this case, in the absence of contradictory evidence from Florida Kitchens, the Member was entitled to rely upon the contract price as establishing the fair value of the work.
The reservation we have referred to at [97] above arises from the fact that the Member did not, as would have been necessary if s 94 had been applicable, consider whether it was "just and equitable" that No 1 receive a quantum meruit for the work it had performed.
The failure to consider whether the requirements of s 94(1A) were satisfied would, if s 94 were applicable, constitute an error of law: Lauer v Comer [2016] NSWCATAP 99 at [13]-[14].
However we do not consider that s 94 was applicable.
Pursuant to s 92(3) of the Home Building Act, s 92 does not apply to a building contract where the contract price does not exceed $20,000, the amount prescribed by regulation 53 of the Home Building Regulation 2014 (NSW).
Section 92(4) provides that: (4) If the same parties enter into two or more contracts to carry out work in stages, the contract price for the purposes of subsection (3) is taken to be the sum of the contract prices under each of the contracts.
Florida Kitchens submitted that s 92(4) was applicable to the contracts, the subject of the proceedings, and that therefore No 1 was required to obtain Home Owners Warranty Insurance in respect of the work carried out under the contract.
The Member did not address this issue in his reasons. However, we consider that s 92(4) was clearly not applicable in this case.
It is clear from the evidence before the Member that Mr Andre Elias sought quotes from Mr Hoang on three occasions in respect of three different sites, and separate prices were quoted by Mr Hoang for each site. There was not one project or job carried out in stages, there were three independent contracts for the performance of three different jobs.
The contract price in each case was less than $20,000 and, accordingly, No 1 was not required to obtain Home Owners Warranty Insurance in respect of any of the contracts.
Although we accept that the Member failed to address specifically the application of ss 92 and 94, we are satisfied that the Member reached the correct result on the evidence and that, even if we were to extend time to permit Florida Kitchens to appeal on this ground, the outcome of the proceedings would ultimately remain unaltered.
We note that neither party referred to regulation 58 of the Home Building Regulation which provides: 58 Exemption from insurance for built-in furniture and other work (1) A holder of a contractor licence who does, or enters into a contract to do, residential building work that consists only of built-in furniture work, and any incidental electrical wiring work involved in the installation of lighting as part of built-in furniture, is exempt from the requirements of Part 6 of the Act [which includes ss92 and 94] in respect of that work if the work is done under a separate contract and not as part of a contract for other residential building work that requires such insurance. (2) In this clause: built-in furniture work means the making and installation of furniture that is made to measure and fixed to a dwelling (such as built-in cupboards, bench tops, wardrobes, entertainment units and the like), and which may be made off-site and installed as a complete unit.
We consider it very likely that the work carried out by No 1 was "built-in furniture work". On the other hand, as No 1 was not the holder of a contractor licence, it may be that the exemption provided by regulation 58 was not applicable. We do not comment further on this issue as it was not the subject of submissions before us.

Group E - Making Findings without Evidence - Grounds 16, 17, 30, 31, 35 and 36

In Grounds 16, 17, 30, 31, 35 and 36 Florida Kitchens asserts that the Member engaged in speculation or made findings without evidence. The parts of the Member's reasons referred to in each of those grounds are not central to the Member's conclusions. It is not necessary to set out each of the statements said to be speculation or unsupported by evidence. We are satisfied that none of the statements was essential to any of the conclusions reached by the Member.
Certain of the matters objected to, for example "that [No 1] had no direct relationship with [Florida Kitchen Centre] although it was working off [Florida Kitchen Centre] plans" (Ground 31 referring to paragraph [58] of the decision), reflect reasonable inferences from the evidence.
We also note that the statement in paragraph [38] (the subject of Ground 30), that No 1 was a sub-contractor of Florida Kitchens, is an uncontroversial corollary of the finding that No 1 contracted with Florida Kitchens.
None of these grounds raises a question of law. None would warrant a grant of leave to appeal. None has sufficient merit to justify the grant of an extension of time.

Group F - Making Inconsistent Findings - Ground 18

By Ground 18 Florida Kitchens suggests the Member made inconsistent findings in two respects.
The first relates to a statement made in the course of the hearing on costs on 12 June 2018. Florida Kitchens asserts that the Member said that he had not read Florida Kitchens' solicitor's statement whereas he had stated in paragraph [40] of the liability decision of 5 December 2017: "Prior to the hearing I had quickly perused the documentary evidence of [Florida Kitchens] including the annexures, but I have not read them again since the hearing."
We do not find any inconsistency between these statements which are, in any event, quite irrelevant to the Member's ultimate findings.
Secondly, Florida Kitchens submits that the Member found at paragraph [29] of the liability decision that the parties contracted on 25 February 2016 and then in the course of his oral reasons on costs stated that he "found that No 1 had entered into three contracts for three different jobs".
Again we see no inconsistency between these statements. In paragraph [29] the Member was addressing the jurisdiction of the Tribunal. He found the parties had entered into a contract for residential building works. He was not addressing the question whether there were three separate contracts or only one. Accordingly, Florida Kitchens could not succeed on this ground and it would not warrant the grant of an extension of time to appeal.

Group G - Taking into account irrelevant matters - Grounds 14 and 15

By Grounds 14 and 15 Florida Kitchens asserts that the Member took into account an irrelevant matter in so far as he referred to the fact that the solicitor for Florida Kitchens, Mr George Elias, was related to Mr Andre Elias (the director of Florida Kitchens) and Mr Joseph Elias (the former director of Florida Kitchen Centre Pty Ltd).
Florida Kitchens also submits that there was no evidence they were related.
As we read the Member's reasons, the only potential significance of the fact that the Messrs Elias were related (if it was the fact) was that it made it less explicable why neither Mr Andre Elias nor Mr Joseph Elias gave evidence. We do not understand the Member to have drawn an inference from the fact that Mr Joseph Elias did not give evidence.
As we understand his reasons the Member did draw support for his conclusion that No 1 contracted with Florida Kitchens from the adverse inference arising from the absence of Mr Andre Elias. That inference arose, strongly, from the fact that Mr Andre Elias was the sole director and shareholder of Florida Kitchens but did not give evidence. The Member's statement, correct or otherwise, that Mr Andre Elias was related to Mr George Elias added nothing to the strength of the inference. Accordingly Grounds 14 and 15 could not succeed and would not warrant the grant of an extension of time.

Group H - Challenges to factual findings - Grounds 10, 13, 19 and 32

Grounds 10 to 13, 19 and 32, at their highest, amount to a challenge to the Member's findings as being against the weight of the evidence. In our view, for the reasons we have outlined above, the weight of evidence clearly favoured No 1's case and nothing in Florida Kitchens' submissions concerning Grounds 10 to 13, 19 or 32 provides any reason to doubt the Member's conclusions.
In Ground 10 Florida Kitchens submits that the evidence of Mr Ferrante was not addressed by the Member. Mr Ferrante did not give oral evidence and was not made available for cross examination. Mr Ferrante's evidence was contradicted by Mr Hoang, who was cross examined. We do not consider that the Member was required to give any weight to Mr Ferrante's evidence.
Florida Kitchens' submissions also appear to involve the proposition that, although Mr George Elias' statement was not put into evidence, the Member should have taken into account the correspondence attached to the statement. Florida Kitchens does not submit that those documents were tendered in evidence, rather it appears to submit that, the Member having, in his words, "quickly perused" the documents in advance of the hearing, he should have taken them into account.
This proposition clearly cannot be sustained. The Member was required to determine the case on the evidence placed before him, not by reference to documents he may have seen which were expressly not tendered at the hearing.
None of the matters raised by Grounds 10 to 13, 19 or 32 could succeed or would justify the grant of an extension of time.

Group I - Costs - Grounds 22 to 29

Florida Kitchens' Grounds 22 to 29 challenge the Member's orders that Florida Kitchens pay No 1's costs and that those costs be assessed on an indemnity basis.
Florida Kitchens does not require an extension of time to lodge an appeal against the costs orders of 12 June 2018. However its entitlement to appeal is limited by s 80 and clause 12 of Schedule 4 to the NCAT Act.
Moreover, as an Appeal Panel held in Zucker v Burbank Montague Pty Ltd [2018] NSWCATAP 135 at [40]: As the costs order involved the exercise of a discretion given to the Tribunal under s 60 of the NCAT Act, the appellant needs to demonstrate an error in the House v The King sense. Such an error may be demonstrated if the Tribunal acted on a wrong principle, made a material error of fact, failed to have regard to material considerations or reached a conclusion which was, on the facts, "unreasonable or plainly unjust": House v The King [1936] HCA 40; 55 CLR 499 at 505; Micallef v ICI Australia Operations Pty Ltd [2001] NSWCA 274 at [45] (Heydon JA; Sheller JA and Studdert AJA agreeing).
Florida Kitchens' eight grounds of appeal against the costs decision do not identify any error of law. Each ground merely asserts that the Member erred in making a particular finding.
To make an order that Florida Kitchens pay No 1's costs, the Member was required to find that there were special circumstances warranting an award of costs.
The Member acknowledged that requirement and determined that there were special circumstances, on the bases set out in paragraph (c) and (e) of Section 60(3) of the Civil and Administrative Tribunal Act, that is: (c) the relative strengths of the claims made by each of the parties, including whether a party has made a claim that has no tenable basis in fact or law, [and] … (e) whether the proceedings were frivolous or vexatious or otherwise misconceived or lacking in substance,
The Member determined that Florida Kitchens' defence had no tenable basis in fact or law and that, by reason of Florida Kitchens' failure to offer any evidence, or any explanation for the failure to offer any evidence, the defence was lacking in substance.
The fact that a claim or defence does not succeed is not sufficient to demonstrate that the claim or defence was without a tenable basis in fact or law or was lacking in substance: Zucker v Burbank Montague, at [44].
However, the Member did not conclude that the defence had no tenable basis in fact or law and was lacking in substance simply on the basis that he had determined the proceedings in favour of No 1.
In reaching the conclusion that Florida Kitchens' defence had no tenable basis and was lacking in substance, the Member considered the evidence which the parties had placed before him. We have outlined that evidence above. The conclusion that Florida Kitchens' defence had no tenable basis in law and was lacking in substance was a conclusion that the Member was entitled to come to in the light of that evidence and we find no error of principle in his approach.
The Member appears to have given significant weight in considering the question of costs to the fact that Florida Kitchens did not call evidence from Mr Andre Elias and provided no explanation for its failure to do so.
We consider that the Member was fully justified in doing so. The contracts pursuant to which No 1 carried out work were not in writing. The Member was entitled to take the view that, if Florida Kitchens was not prepared to call evidence from its sole director, who was the only person associated with Florida Kitchens who was shown to have had any connection with the contracts, it should not be taken to have had any tenable basis for maintaining that Florida Kitchens was not a party to the contracts.
To the extent that the Member characterised Florida Kitchens' defence as limited to the submission that No 1 had contracted with Florida Kitchen Centre Pty Ltd and not Florida Kitchens, that may have been incorrect. Nevertheless, in light of the matters we have set out above in relation to Florida Kitchens' "statutory defences" we do not consider that that misstatement was sufficient to render erroneous the Member's conclusions as to the lack of substance in the defence.
The decision to award indemnity costs was also a discretionary decision only open to challenge on the bases outlined in House v The King.
In awarding costs on the indemnity basis the Member took into account an offer of compromise served by No 1 while the proceedings were in the Local Court.
The Member accepted that the offer of compromise made by No 1 was "significantly advantageous" to Florida Kitchens and that it was not reasonable for Florida Kitchens not to accept the offer. Those conclusions were sufficient to warrant an order for costs to be assessed on the indemnity basis and we find no error of principle in the Member's conclusion that it was appropriate to make such an order.
Florida Kitchens submitted that the offer of compromise was made in the Local Court where costs sanctions would have applied regardless of whether there were special circumstances, but that does not alter the facts that No 1 offered to settle the proceedings at an early stage for a substantial discount and that Florida Kitchens had no reasonable justification for not accepting the offer.
We see no reason why the effect of the offer of compromise and Florida Kitchens' failure to accept it should not continue to be effective after the proceedings were transferred to the Tribunal.
In its submissions Florida Kitchens referred to authorities relating to the effect of offers made at first instance on the allocation of costs in respect of an appeal, for example McKeith v Royal Bank of Scotland PLC (No.2) [2016] NSWCA 260. Those authorities are distinguishable. An appeal is brought in circumstances where one side has already succeeded in the proceedings. The question on appeal is usually whether the successful party should retain the benefit of the decision in its favour.
As Hoeben JA, with whom Meagher and Tobias JJA agreed, observed in Bathurst Regional Council v Thompson (No.2) [2012] NSWCA 420 at [16]: The usual position is that appeal costs should primarily be determined by the issues in and the outcome of the appeal proceedings themselves.
We note that the Court of Appeal in Grace v Thomas Street Café (No.2) [2008] NSWCA 72 at [33] acknowledged that, in considering the allocation of the costs of an appeal: "a pre-trial offer may be relevantly persuasive in the exercise of the discretion [relating to costs] depending upon all of the circumstances".
In the present case there was no determination of the proceedings in the Local Court, the same dispute and the same issues as had been before the Local Court were present in the proceedings before the Tribunal.
In the course of oral submissions Mr Milanovic submitted that the Member made an error of law in not identifying the date from which the order for indemnity costs should run. It is customary that, where a Calderbank letter (that is an offer of settlement referring to the principles discussed in Calderbank v Calderbank [1975] 3 All ER 333) or offer of compromise is made in proceedings and not accepted, the advantageous effect of that letter or offer takes effect only from the time of the offer. However we note that in this case the offer was made at a very early stage. It cannot be said to have been an error of law for the Member to have awarded indemnity costs in respect of the whole proceedings in circumstances where, at a very early stage of the proceedings, the plaintiff/applicant made an offer of settlement advantageous to the defendant/respondent which was not accepted.
Accordingly we find no error of law in the costs decision. Nor do we find the costs decision not fair and equitable or against the weight of evidence. Florida Kitchens' appeal against the orders made on 12 June 2018 must fail.
We will refuse Florida Kitchens' application for an extension of time to lodge an appeal against the decision of 5 February 2017, we will refuse leave to appeal and the appeal will be dismissed.

Costs of the Appeal

No 1 submitted that in the event the appeal was dismissed, it should be awarded the costs of the appeal on the indemnity basis.
As we understand No 1's submission, it relies upon the original offer of compromise as justification for that order. No 1 did not produce any correspondence, concerning the making of offers or otherwise, in relation to the appeal proceedings. As the Court of Appeal held in Grace v Thomas Street Café (No.2) [2008] NSWCA 72 at [33]: Pre-trial settlement offers do not necessarily continue to operate for the purpose of an appeal. Generally, if an offer is not renewed (either in the same or different terms) prior to the appeal, the Court will not make a special costs order in respect of the appeal.
We do not consider that the offer of compromise made in the Local Court constitutes special circumstances relevant to the costs of the appeal.
The Appeal Panel in Hancock & Claringbold v Calalla Bayside Realty [2016] NSWCATAP 60 at [56]-[60] reached the same conclusion.
Although the appeal was out of time in respect to the first decision and largely without merit, we recognise that there are some respects in which we have found the Member's reasoning was not adequate. In those circumstances we do not consider that there are special circumstances sufficient to warrant an order that Florida Kitchens pay No 1's costs of the appeal.

Orders 1. The appellant's application for an extension of time to lodge an appeal against the decision of Senior Member Meadows of 5 December 2017 is refused. 2. Leave to appeal against the decision of Senior Member Meadows of 12 June 2018 is refused. 3. The appeal in respect of both decisions is dismissed. 4. The respondent's application for the costs of the appeal is refused. 5. Each party to the appeal is to pay their own costs of the appeal.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar 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: 27 November 2018

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