Giardina v Cupri & 2 Ors

The first respondent is 100% liable in contract to the applicant.

The first respondent is agent for the importer/manufacturer principal. The principal is a concurrent wrongdoer pursuant to the Civil Liability Act 2002 with the first respondent to the extent of 50%.

The final orders are subject to agreement on quantum. Any costs orders will be dealt with in the final determination.

I allow a sum to be advised to the applicant for rectification of items identified on page 24-26 above. The Tribunal awaits agreed signed minutes of order as to the cost of rectification of: a) the tilt and turn function of windows identified on page 26, as to be advised and

b) the refund of the cost of the windows not fit for purpose identified on page 27

in order to determine a proper sum to be allowed to the applicant."

Procedural fairness in Tribunal 16 Ms Giardina submitted that she was denied procedural fairness as she was not given sufficient time to provide the Tribunal with evidence as to quantum. 17 Section 28 of the CTTT Act reads: "Procedure of Tribunal generally

(1) The Tribunal may, subject to this Act, determine its own procedure.

(2) The Tribunal is not bound by the rules of evidence and may inquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of procedural fairness.

(3) The Tribunal is to act with as little formality as the circumstances of the case permit and according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms.

(4) The Tribunal is to take such measures as are reasonably practicable to ensure that the parties in any proceedings understand: (a) the nature of the assertions made in the proceedings and the legal implications of those assertions, and

(b) the procedure of the Tribunal and any decision or ruling made by the Tribunal that relates to the proceedings." 18 Section 35 of the CTTT Act reads: "Opportunity for parties to present case

The Tribunal must ensure that each party in any proceedings is given a reasonable opportunity:

(a) to call or give evidence and otherwise present the party's case (whether at a hearing or otherwise), and

(b) to make submissions in relation to the issues in the proceedings. …" 19 Section 35 provides that the CTTT "must ensure" that each party is given "a reasonable opportunity" to present its case. There are provisions which allow the CTTT 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 - see Italiano v Carbone & Ors [2005] NSWCA 177 at [105] and [106]. 20 In her decision dated 21 December 2005 the Tribunal Member records: "On or about October 2005 the Tribunal handed down an Interim Decision with regard to these proceedings. In that decision the Tribunal made clear that it required certain information to be supplied by the applicant to the respondent and jointly to the Tribunal as to a matter of quantum which was unclear in the experts' agreed joint report.

The matter was re listed on 7 December 2005 given that no information had been received from any of the parties, particularly the applicant who was in breach of the Tribunal's orders. The Member made directions and extended an indulgence to the applicant to provide the information requested in the Interim Decision on or before 14 December 2005.

I note that Mr Acotto informed the Tribunal on 7 December 2005 that he appeared for the applicant direct as there was no longer an instructing solicitor. It was on that basis that the indulgence was granted to the applicant in extending time to comply with the previous directions. On 15 December 2005, the Tribunal was informed that the applicant was not able to comply with the order to supply the quantum information requested as information had to be obtained from Italy. Be that as it may, the applicant's evidence at hearing had included a quote for certain window/doors which were not separately itemised on that quote. However, I find it difficult to understand that the applicant has no knowledge of the breakdown of the global price quoted for those window/doors. There is some indication and breakdown on the quote as to other windows and doors and other items.

Accordingly, the Tribunal grants no further time for the applicant to supply that information because of the applicant's non compliance with the orders and the need to do justice to the parties. The Tribunal issues its final orders utilising, to the best of its ability, the information set out in the joint agreed experts' report, vague as it might be. Those experts were not required for any cross examination by either party to these proceedings.

I set out the allowed sums in this final decision with some amendment to the figures in the Interim Decision which were incorrect as they were not based on the final figures but on a guess estimate." 21 On 27 October 2005 Ms Giardina was directed to supply further information to the Tribunal. On 7 December 2005 the matter was relisted by the Tribunal. On that day Ms Giardina's Counsel informed the Tribunal Member, given that neither party had complied with the Tribunal's directions and sought an extension of time to comply. An extension was granted to 14 December 2005. There was no compliance with those directions. 22 On 15 December 2005 the Tribunal was informed that the quantum information had to be provided from Italy. Apparently, the information required was a breakdown of the global price quoted for certain windows and door. There was no affidavit evidence provided as to what attempts had been made to obtain this information. It is expected that parties comply with Court directions and if they are unable to do so, at the very least the non-complying party is obliged to demonstrate what efforts they have made to do so. In my view Ms Giardina was given a reasonable opportunity to provide the information sought by the Tribunal member but she did not do so.

Whether the Tribunal Member erred by referring to Item 1 as Item 2? 23 The Tribunal member made the following finding: "Item 1 - the Respondent to replace affected sections as required in the agreed price of $1,250.00." 24 It is Item 2 in the joint experts' report that refers to an agreed rectification cost of $1,250.00. Item 1 relates to the doors to the family room with no agreed amount. Elsewhere, the Tribunal Member referred to the doors to the family room in her reasons and noted that the sum to be allowed to Ms Giardina was unknown. The Tribunal Member ordered that the parties were to provide her with an agreed sum after an interim decision was handed down. This could be done by written submissions forwarded to Chambers. No agreed sum was reached and no written submissions were furnished. As the parties did not comply with the Tribunal's directions, the Tribunal Member made an order that Ms Giardina was to return the defective doors. Ms Giardina had an opportunity to clarify the interim orders if he was in any doubt about them but he did not do so. 25 The Tribunal Member, in her interim reasons, considered both Items 1 and 2. In relation to the family room doors, as Ms Giardina did not provide the Tribunal Member with the information required, she calculated rectification costs from the incomplete material that had been provided. While it was open to the Tribunal Member to adopt that approach, there are difficulties with the order for rectification. I have referred to these difficulties in more detail under the next heading.

The Home Building Act 26 On 21 December 2005, the Tribunal Member entered verdict for the respondent in the amount of $21,545.00 on the cross application (Final order 3) and ordered that the applicant to pay the sum of $527.50 to the respondent upon completion of the work set out in order 2 above. 27 Ms Giardina submitted that in relation to these orders, firstly, that the plaintiff is incapable of making payment to a party insufficiently identified as the decision of the Tribunal Member does not identify which of the two respondents the order is made in relation to; and secondly, as neither of the respondents are properly licensed and have no home warranty insurance they are not entitled to payment for work. For the purposes of dealing with this argument, I shall assume that the Tribunal Member was referring to all respondents. 28 On the issue of whether the respondents were licensed, the Tribunal Member stated: "Cupri stated that he informed the applicant that he did not have a building licence and that Verzeroli, the managing director of GMP Building Supplies would look after the installation when the goods arrived at the premises. This is contrary to what the applicant says but Cupri was not tested on this evidence in cross examination and I accept it. Initially the sub frame work installation was carried out by a Mr. M Angeloca, also a director of GMP Building Supplies." 29 The installer, who had a licence, was Mr Verzeroli the managing director of GMP Building Supplies. The actual installation work was subcontracted by GMP Building Supplies to Woodhill Timber Windows and Joinery who in turn subcontracted the installation to Samaras Industries Pty Ltd. 30 The Tribunal Member continued: "This question of unlicensed contracting by the supplier/installer Cupri arising out of the contract between the parties is to be determined upon the evidentiary facts. I accept the evidence that the Contract was a supply and install one and that the actual installer was licensed for that work. There is no evidence to the contrary from the applicant. I also accept Cupri's evidence that he informed the applicant that he did not have a licence but the installer did. Cupri is the agent for the importer who, on the evidence, is also the installer but in fact subcontracted the actual work of installation to another contractor." 31 Thus, the Tribunal Member made a finding that the contract between Ms Giardina and Mr Cupri was for both the supply and the installation of goods. The Tribunal Member referred to De More Constructions Pty Ltd v Garpace Pty Ltd (2001) 53 NSWLR 132. 32 The Tribunal Member stated: "…the applicant's husband and the actual installer held an appropriate permit and licence respectively for the Works. In my view that is sufficient compliance with the aim of the Act and section 10 of the Act. In different circumstances to this case it may be that the importer principal, rather than the agent Cupri, requires a contractor's licence before entering into any supply and install contracts for residential building work." 33 Notwithstanding the finding that Cupri required a licence to enter the supply/install contract, the Tribunal Member concludes, "It follows from my findings that the respondent Cupri is not precluded from enforcing a claim to be paid the full price of the Contract sum plus variations." It is upon these findings that Final Orders 2 and 5 are based. 34 It is necessary to consider ss 4(1) and 10(1)(a) of the HBA. They read: "4 Unlicensed contracting

(1) A person must not contract to do: (a) any residential building work, or

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. 10. Enforceability of contracts and other rights (1) person who contracts to do any residential building work, or any specialist work, and who so contracts: (a) in contravention of section 4 (Unlicensed contracting), 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 the contract is unenforceable by the person who contracted to do the work. However, the person is liable for damages and subject to any other remedy in respect of a breach of the contract committed by the person." 35 Section 4 of the HBA provides a general prohibition on unlicensed individuals and corporations from contracting to do residential building work. In De More, Fitzgerald AJA held [21] that s 4: "…prohibits any person, other than those exempted from that prohibition, from contracting to do any residential building work. The words introduced by the word "except" exempt from the general prohibition on contracting to do residential building work those who contract "as or on behalf of an individual, partnership or corporation that is the holder of a licence authorising its holder to contract to do the work."" 36 These are the only exemptions to the requirement of holding a building licence to contract to perform residential building work. Mr Cupri, who is unlicensed and a party to the contract (and the other respondent) cannot overcome s 4 by sub-contracting to a licensed installer. 37 Section 10 of the HBA generally prohibits unlicensed contractors from seeking relief under a home building contract. This section reflects the general tone and intendment of the act by protecting consumers and by discouraging unlicensed contracting. Under s 10(1)(a) a party in breach of s 4 of the HBA is barred from relying on the contract in an action for damages and the contract is unenforceable by the person who contracted to do the work. In addition, the section protects the rights of the consumer by allowing them remedy in respect of a breach of the contract. 38 In light of s 10(1)(a) of the HBA, Final Orders 2 and 5 of the Tribunal Members Final Orders dated 21 December 2005 so far as they relate to residential building work or specialist work are inconsistent with the plain wording of the section and with protection this section seeks to afford to consumers. These orders should be set aside. The matter is remitted to the Tribunal to be dealt with according to law.

Final Order 3 39 Final Order 3 from the 21 December 2005 hearing is as follows: "The Respondent to carry out the agreed and ordered rectification works within 28 days of the date of this decision." 40 This order was made by the Tribunal Member in relation to a number of deficiencies found in the quality and installation of the doors and windows installed at the plaintiff's residence. In relation to Final Order 3, Ms Giardina submitted that, as the respondents do not hold the appropriate licenses to perform residential buildings works they could not comply with the order to carry out rectification works. 41 In De More the NSWCA stated, "s 4 and s 10(3) are directed to contracts to do work, while s 12 and s 13 are directed to physical performance of the work." In respect to the physical performance of the work, s 12 of the HBA provides: "Unlicensed work An individual must not do any residential building work, or specialist work, except: (a) as, or as a member of a partnership or an officer of a corporation that is, the holder of a contractor licence authorising its holder to contract to do that work, or

(b) as the holder of an owner-builder permit authorising its holder to do that work, or

(c) as an employee of the holder of such a contractor licence or permit." 42 Furthermore, s 13 of the HBA provides: "Unqualified residential building work

(1) An individual must not do any residential building work, except: (a) as the holder of an endorsed contractor licence, a supervisor or tradesperson certificate or an owner-builder permit, authorising its holder to do that work, or

(b) under the supervision, and subject to the direction, of the holder of an endorsed contractor licence or supervisor certificate authorising its holder to supervise that work." 43 The Tribunal Member, made a finding that neither of the respondents held a valid contractor licence. That being so, the Tribunal cannot order the unlicensed respondents to carry out the rectification work at Ms Giardina's residence. 44 The appeal is upheld. To set aside the unlicensed installation work, it is necessary to set aside the orders made on 27 October 2005. The decisions of Tribunal Member Leotta dated 27 October 2005 and 21 December 2005 are set aside. The matter is remitted to the Tribunal to be determined according to law. 45 Costs are discretionary. Costs usually follow the event. The defendants are to pay the plaintiff's costs as agreed or assessed.

(2) The decisions of Tribunal Member Leotta dated 27 October 2005 and 21 December 2005 are set aside.

(3) The matter is remitted to the Tribunal to be determined according to law.

(4) The defendants are to pay the plaintiff's costs as agreed or assessed. **********

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