Guan v Chan; Chan v Guan

The Applications

1. For ease of reference the parties shall be referred to as builder and homeowner.
2. The initial application was made by the homeowner on 17 July 2013 and was for defective and incomplete works totalling $42,631.75.
3. By the time the matter came for hearing, the claim was as follows 1. Damages for breach of contract for defective and incomplete works $28,349.52 2. Loss of rent - $6,825.00 3. Loss of value of the premises - $30,000.00 4. Paint Costs - $1,806.20 5. Costs
4. The builders made an application on 17 September 2013 seeking an amount of $13,360.00 for amounts they state remain outstanding under the contract and for damages for breach of contract.

Jurisdiction of the Tribunal

1. Mr Yongqiang Guan (Mr Guan) is the owner of the subject property. He states that he authorised his wife Linda Guan (Mrs Guan) to negotiate with the builder on his behalf.
2. It is not in dispute between the parties that on 13 May 2013 a quote was sent by email from Indesign Building Solutions Pty Ltd (the corporation) to Linda Guan, following negotiations between Mr William Chan for the builder and Linda Guan for the homeowner. The quote was for renovation works to the ensuite bathroom, main bathroom and laundry, downstairs living area, garage, balcony and painting to the house totalling $37,400.00 inclusive of GST. The quote is signed Linda and is dated 15 May 2013.
3. The Tribunal finds that the parties contracted for residential building works as defined in section 3 of Home Building Act 1989 (NSW) (the Act) on 15 May 2013. The Tribunal is satisfied that both applications involve a 'building claim' as defined by s 48A of the Act. The Tribunal is also satisfied that both claims have been made within time and that it has jurisdiction to determine the building claims pursuant to section 48K of the Act.

The parties to the Contract

1. A number of issues have been raised in relation to the parties to the contract. The first is that the builder disputes that Mr Guan is the correct party to the contract and that Mrs Guan is the correct party to the contract. In that regard there is no dispute that negotiations were had between Mr William Chan and Mrs Guan in relation to the contract. However, the Tribunal finds that even though Mrs Guan signed the quote, the builder was at all times aware that Mrs Guan was negotiating on behalf of her husband who was the homeowner.
2. In her statement dated 22 October 2013, Mrs Guan states at paragraph 5 that in initial meetings she explained to Mr Chan: "We want to renovate our house, we have just purchased it.
3. According to Mrs Guan, in further conversation Mr Williams answered: "I'll prepare a quote for you. I will provide a contract for the building work. We always provide an owner with a two year warranty in accordance with Australian Standards."
4. The quote is under the header "Indesign Building Solutions Pty Ltd" and is addressed to "Linda". At the end of the quote next to "Customer Name" and "Customer Signature" appears "Linda"
5. Although the quote is sent and signed by "Linda", the Tribunal is satisfied that at all times the parties intended that the builder was contracting with Mr Guan, the owner and that Mrs Guan was negotiating on his behalf. In that regard the Tribunal is particularly persuaded by a letter dated 10 June 2013 and sent by the builder to Mr Guan stating the following: I am writing this letter in regards to the building works at …. Toongabbie that your wife, Linda signed on your behalf on the 15th May 2013 with a total amount of $37,000.00.
6. Accordingly, the Tribunal is satisfied that at all times Linda Guan was acting on behalf of her husband Mr Guan and that he was the only party to the contract with the Corporation.
7. Mr Chan also made submissions that he never intended to contract as director on behalf of Indesign Building Solutions Pty Ltd but made a mistake and was intending to contract on behalf of another company of which he was director, International Design (holding) Pty Ltd. He highlights that International Design (holding) Pty Ltd was properly licensed to do the work. The Tribunal finds that Mr Chan's evidence on this point is self-serving because he recognises that International Design (holding) Pty Ltd is properly licensed to do residential building works and Indesign Building Solutions Pty Ltd was not. However, more persuasive is that in her statement of 23 October 2013, Mrs Guan stated she received a business card with the Corporations name on it. The quote is under the heading of Indesign Building Solutions Pty Ltd and the correspondence of 10 June 2013 is also under the Corporation heading. There is nothing to suggest that at any time Mr Chan had represented to the homeowner that he was contracting on behalf of International Design (holding) Pty Ltd.
8. Moreover, the application of the builder has been made in the name Indesign Building Solutions Pty Ltd and Mr William Chan. It is difficult to understand why if the builder had been International Design (holding) Pty Ltd, why the debt recovery claim has been made in the name of Indesign Building Solutions Pty Ltd and Mr William Chan. Surely if the builder was mistaken at the time of contracting then it would have been recognised at the time of making his application. The Tribunal finds that Indesign Building Solutions Pty Ltd was the builder with whom Mr Guan contracted.
9. Similarly the Tribunal finds no grounds for finding that Mr William Chan, the director of the Corporation has contracted with the Mr Guan in any individual capacity. The builder has named both William Chan and Indesign Building Solutions Pty Ltd as applicant to the claim. However no grounds have been provided to demonstrate how it is that Mr Chan has contracted with the homeowner in his individual capacity. In closing submissions it is acknowledged by the builder that : Mr Chan was the sole director of the first respondent company, and represented his company in dealing with this home renovation business with the applicant. The applicant received the business card of Mr William Chan clearly expressed the second respondent was the director of the first respondent. And the contract was then signed between the first respondent and the applicant. Mr Chan acted on behalf of the company all the time in his conduct of operating the business and had no personal liability to the claims of the applicant. Thus all the legal rights and responsibilities in this proceeding should be directed to the first respondent only, not Mr Chan personally. It is a well established legal principle that the company s a separate legal entity - Solomon v Solomon & Co Ltd
10. On the Builders own submissions the Tribunal can find no basis on which Mr Chan can bring the application for outstanding monies in his individual capacity. Given that the Corporation is under external administration and the Tribunal finds no grounds for Mr Chan to bring the application in his individual capacity, the application of the builder is dismissed in its entirety.

Misleading and Deceptive Conduct

1. The homeowner brings the application against Mr Chan as an individual on a completely different basis. It is not disputed there was no Home Warranty Insurance obtained by the builder as required by Part 6 of the Act. It is also not disputed that the builder as a Corporation was not properly licensed at the relevant time.
2. The homeowner asserts that Mr Guan, through misrepresentation has become personally liable for the damages and relies s74 on (3) of the Fair Trading Act 1987 (NSW) (FTA) which relevantly states the following: 74 Actions for damages and compensation orders …. (3) The Tribunal may decide the matter of whether a person has suffered loss or damage because of the conduct of another person that constitutes a local contravention or a contravention of Chapter 2 or 3 of the ACL if that matter arises in connection with another matter the subject of proceedings in the Tribunal. In deciding the matter of loss or damage, the Tribunal may award such sum, and make such ancillary orders, as it thinks fit. ….
3. In that regard the homeowner relies on section 18 contained in Chapter 2 of schedule 2 of the Competition and Consumer Act (2010) (Cth) (ACL) which relevantly states: 18 Misleading or deceptive conduct (1) A person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.
4. The homeowner makes claims for misrepresentation on three grounds: 1. Mr Guan's stated that he would provide the homeowner with a 2-year warranty. They refer to the fact that the representation itself is incorrect and that the builder was required by virtue of section 18B of the Act to provide a six year warranty for structural defects and two year warranty in other cases. 2. The builder and Mr Chan were not licensed to do the work. 3. The builder did not advise the homeowner that they required home warranty insurance which amounts to a misrepresentation by silence.

Misrepresentation by the Individual

1. The homeowner refers in particular to the case of Viegas v Beyond 2000 Design and Construction Pty Ltd [2013] NSW CTTT 441 where the Tribunal found that the builder was guilty of misleading and deceptive conduct under the Fair Trading Act 1987 as it applied in 2009. In that case the Tribunal found the builder had engaged in misleading and deceptive conduct in preliminary discussions it had with the howmeowner regarding the costs and plans and specifications and the Tribunal allowed the difference between the price stated in preliminary discussion and the amount ultimately paid. However, that order was made against the building corporation and not against any individual who might have made those representations as is being proposed in this matter. The Tribunal accepts that an application for misrepresentation pursuant to s74(3) of the FTA may be made. The real question is whether it can be made against the person who represented the matter on behalf of the Corporation.
2. In the case of Houghton v Arms [2006] HCA 59, the High Court held that employees of a company were individually liable for their misleading and deceptive conduct under section 9 of the Victorian Fair Trading Act 1999. In that case the Victorian legislation read in almost the same terms as s 18 of the ACL. The matter involved an Appeal of orders made against employees who were found by the Federal Court to have been acting within the scope of actual authority and liable for misleading or deceptive conduct. Judgement was made against the employees and it was found that individuals whose conduct was "in trade or commerce" could be liable to pay damages for that conduct, regardless of whether they as an employee of the company at the time.
3. The principles contained in Houghton v Arms were adopted in the subsequent case of CH Real Estate Pty Ltd v Jainran Pty Ltd ; Boyana Pty Ltd v Jainran Pty Ltd [2010] NSWCA 37. That case involved the sale of a commercial property. Boyana Pty Ltd was the vendor and Mr Sgro was the director of the Corporation. It was found, in the initial proceedings that Mr Sgro had made certain representations by failing to disclose to the purchaser road widening proposals and as such was personally liable for the damages which flowed from those misrepresentations. Basten JA noted that the Fair Trading Act as it was then extended to a person engaging in misleading and deceptive conduct. Similarly, the ACL extends to such conduct. In the appeal Counsel for Mr Sgro had submitted; that to impose liability on Mr Sgro for conduct undertaken as the human agent of the corporate entity had the effect of withdrawing the protections available to an individual who sought to run a business through a corporate vehicle.
4. His Honour adopted the reasoning in Houghton v Arms and concluded: 104 There remains a question whether the conduct of the corporation in presenting the contract with its misleading representations to the purchaser, was also the conduct of Mr Sgro. Whilst, as the mind of the company, he directed the preparation of the contract and executed it on behalf of the company, he was not aware that the contract contained the precise representations relied upon, nor was he aware of the falsity. The latter element of ignorance is not presently relevant, there being at this stage no question of accessorial liability. The question is whether, because s 42 requires no intent, or even negligence, on the part of the person engaging in the prohibited conduct, the fact that Mr Sgro may not have been aware of the existence of the statements in the contract would relieve him of liability. Just as the corporation will be liable because it presented a contract to the purchaser containing statements which were in fact misleading or deceptive, so Mr Sgro will be liable under s 42 if he engaged in conduct of the same kind. Apart from the conduct involved in signing the contract, his conduct was engaged in through the agency of the solicitors. They, acting on instructions received from him (albeit on behalf of the vendor) prepared the contract and, after obtaining its execution by him (on behalf of the vendor), again acting on his instructions as the human embodiment of the corporation, forwarded the contract to the purchaser. Mr Sgro submitted that the acts of the solicitors were carried out purely as agent for the vendor, and not on behalf of Mr Sgro himself, who was not their client. In terms of legal analysis, that was correct; in terms of the characterisation of the conduct, it was nevertheless conduct which can be attributed to the direction of Mr Sgro, as a matter of fact. That the mechanical task of presenting the contract was delegated to someone in the solicitor's office (probably a clerk) does not prevent the conduct being properly attributed to Mr Sgro, as the person directing the affairs of the vendor.
5. Given those statements, the Tribunal finds that Mr Chan could be personally liable in the event that it is found that he engaged in conduct that was misleading or deceptive or was likely to mislead or deceive.

Did Mr Guan engage in conduct that was misleading or deceptive or was likely to mislead or deceive in relation to the warranty?

1. It is not in dispute that the records show that the Corporation was not licensed to do the work at the time the parties contracted. Mr Chan himself was licensed as a builder and his license number appeared on the quotation provided to the homeowner. Another license number, 210428C also appeared on the quotation and belongs to another company of which Mr Chan is a director of, International Design (Holdings) Pty Ltd.
2. Mrs Guan also stated that Mr Chan told her that the builder would provide a 2 year warranty. The applicant makes submissions that that representation is incorrect, because the builder was required by s 18E of the HBA as it applied at the time, to provide a 6 year warranty for structural defects and 2 year warranty in other cases.
3. The applicant also alleges that the builder remained silent in relation to the requirement to obtain Home Warranty Insurance.
4. The applicant maintains that all three of those matters lead to the outcome that the builder has engaged in conduct which mislead and deceived the homeowner.
5. In the Tribunal decision of Hatz v Grace [2013] NSWCTTT 274, Member Ringrose has provided a helpful summary in relation to the relevant principles in relation to misleading and deceptive: In ACC v Dukermaster Pty Limited (2009) FCA 682 the court set out a helpful summary of the principles to be applied in considering misleading or deceptive conduct. - Conduct which is misleading or deceptive or likely to mislead or deceive can include making a statement which is misleading or deceptive or likely to mislead or deceive. - The "conduct" must lead or be capable of leading a person into error and the error or misconception must result from the conduct of the person and not from other circumstances for which the person is not responsible. - "Conduct" is likely to mislead or deceive if there is a "real or not remote chance or possibility" regardless of whether it is less or more than 50%. - Test of misleading or deceptive conduct is objective and should not take into account those who fail to take reasonable care for their own interests. - It is inappropriate to select particular words or acts which, although misleading in isolation do not have that character when viewed in context.
6. The test for misleading and deceptive conduct is an objective one. The Tribunal shall deal with each of the alleged misrepresentations in turn.

The Two Year Warranty

1. Dealing firstly with the representation that Mr Chan told Mrs Guan that he would provide a 2 year warranty. S 18E of the HBA as it applied at the time provided a 6 year warranty for structural defects and 2 year warranty in other cases. S 18G stated that the statutory warranties may not be excluded. The Tribunal finds that Mr Chan did tell Mrs Guan that she had a two year warranty. But it is incorrect to say that as a result of such a representation, the builder engaged in conduct which was likely to mislead or deceive the homeowner. That representation could never have adversely affected the homeowner. There is no doubt that the statutory warranty that the homeowner received on contracting with the respondent is that contained in s18E of the HBA, regardless of what the builder told Mrs Guan. The builder could not contract out of the warranties contained in s18E. The warranty the homeowner became entitled to on contracting with the builder was better than what the builder had told her she would receive. On the basis Mr Chan told Mrs Guan that she was only entitled to a two year warranty, the Tribunal is not satisfied that the builder has engaged in conduct which was misleading and deceptive or likely to mislead or deceive.

Licensing

1. In her statement Mrs Guan relevantly recollects statements made to her by Mr Chan. She relevantly states that after contacting Mr Chan for a quote he attended her property and the following occurred: 5. On William's arrival at the property, I received a business card from him titled "lndesign Building Solutions" ("the builder") The card had William Chan shown on it as a Director. At this meeting, William was accompanied by his daughter. I remember a conversation taking place with words to the following effect:- I said:" We want to renovate our house, we have just purchased it." I remember showing William around our house and remember conversations taking place throughout the house as we went through the house room by room. I remember William making certain recommendations to us. I remember a conversation with words to the following effect: William: "I'll prepare a quote for you. I will provide a contract for the building work. We always provide an owner with a two year warranty in accordance with Australian Standards." I said: "We are currently renting a townhouse and need to move in to our place within 3 weeks. Can you get the work done within that time?" William: "Yes, I can get the work done within that time." At no time did William speak to me about home warranty Insurance. Iwas not aware of home warranty insurance until I researched it on the OFT website after the builder had left the property. 6. I remember at our first meeting with William with words to the following effect: William: "The asbestos in the garage and the downstairs living area needs to be removed." I remember William showing me his asbestos removal licence. William: "I will need to charge you extra for removal of the asbestos." I believe that William was at the property for approximately one hour. 7. On 13 May 2013 James received an email from lndesign Building Solutions Pty Ltd ("The Builder") with a quote attached. [TAB 1]. 8. Upon receipt of this quote, I remember a telephone conversation with the builder and the following conversation taking place: I said: "We accept the price. When can you start the work.?" William: "I can start the work on the 15th." 9. Either on the 13th or 14th May 2013, William came to the property. At this time James was at work. I remember a conversation taking place with William with words to the following effect: William: "I will give you a 5% discount if you pay cash. There will be no GST. We can start work on the 15th." 10. On 15 May 2013 the builder and it's workers arrived at the property. I remember a meeting with William. William and I sat in his 4WD motor vehicle I had two copies of the quote dated 13 May 2013 with me. I remember William going through the quote section by section and discussing the work. I remember a conversation with William at this time with words to the following effect: William: "The price will be $34,000.00 less a discount of $1700.00. There will be no GST." I remember signing the quote in the presence of William and William signing the quote in my presence. I remember a further conversation with words to the following effect: I said: "We need to sign a contract." William: "This (showing me the quote) is the contract. We will give you a two year warranty in accordance with the Australian Standards." At no time did I sign a contract nor did I receive a contract of any sort until 5 June 2013 after I had followed the builder and Jack Au. At no time was I advised about a cooling off period and at no time have I signed a building contract.
2. There is some dispute about whether the applicants later refused to sign a standard form contract or not. It is immaterial as is clear and the Tribunal finds that the parties contracted based on the quote which the Mrs Guan accepted and signed on behalf of her husband on 5 May 2013.
3. It cannot be said that if found, this was a misrepresentation made by silence as the homeowner contends. There are clearly license numbers contained on the quote including the license number of the director. While the Tribunal accepts that the corporation was not properly licensed to undertake building works, Mr Chan himself is a licensed builder. That license number appeared clearly on the quotation. No evidence is before the Tribunal about Mrs Guan questioning or asking about licensing at any stage of negotiations. Even if the Tribunal were satisfied that placing the individual directors licensing on the quotation amounted to a misrepresentation, the Tribunal is not satisfied that the licensing induced the homeowner to enter into the contract into the contract.

No Home Warranty Insurance - Misrepresentation by Silence

1. S92 of the HBA requires that contract work must be insured and relevantly states: (1) A person must not do residential building work under a contract unless: (a) a contract of insurance that complies with this Act is in force in relation to that work in the name under which the person contracted to do the work, and (b) 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. Maximum penalty: 1,000 penalty units in the case of a corporation and 200 penalty units in any other case. (2) A person must not demand or receive a payment under a contract for residential building work (whether as a deposit or other payment and whether or not work under the contract has commenced) from any other party to the contract unless: (a) a contract of insurance that complies with this Act is in force in relation to that work in the name under which the person contracted to do the work, and (b) 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. Maximum penalty: 1,000 penalty units in the case of a corporation and 200 penalty units in any other case.
2. S7 of the HBA also sets out the requirements of a contract and that a contract must be in writing and contain certain requirements. Specifically s 7 (3) as it applied at the time required: (3) The contract must comply with any requirements of the regulations.
3. Regulation 13 of the then Home Building Regulations 2004 required that: (1) A contract to which section 7 of the Act applies between a person and the holder of a contractor licence for residential building work to be done by the holder must include a checklist in the form set out in Schedule 3. (2) This clause does not apply to a contract of a class referred to in clause 16.
4. That checklist included the following information for owners: Checklist for owners entering building contracts Checklist 1 Does the contractor hold a current contractor licence? Yes □ No □ 2 Does the licence cover the type of work included in the contract? Yes □ No □ 3 Is the name and number on the contractor's licence the same as on the contract? Yes □ No □ 4 Is the work to be undertaken covered in the contract, drawings or specification? Yes □ No □ 5 Does the contract clearly state a contract price or contain a warning that the contract price is not known? Yes □ No □ 6 If the contract price may be varied, is there a warning and an explanation about how it may be varied? Yes □ No □ 7 Are you aware of the cooling off provisions relating to the contract? Yes □ No □ 8 Is the deposit within the legal limit? The limit is 10% for work costing $20,000 or less or 5% for work costing more than $20,000. Yes □ No □ 9 Is the procedure for variations understood? Yes □ No □ 10 Are you aware of who is to obtain any council or other approval for the work? Yes □ No □ 11 Do you understand that the contractor must have a policy of home warranty insurance under the Home Building Act 1989 and provide you with a certificate of insurance before receiving any money under the contract (including a deposit) or before doing any work for more than $20,000? Yes □ No □ 12 Has the contractor given you a document that explains the operation of the Home Building Act 1989 and the procedures for the resolution of contract and insurance disputes?

1. Further, ss 7AA and 7A of the HBA required the following: 7AA Consumer information (1A) This section applies only to contracts to which section 7 applies. (1) A holder of a contractor licence must, before entering into a contract that the holder is authorised by this Act to enter, give to the other party to the contract information, in a form approved by the Director-General, that explains the operation of this Act and the procedure for the resolution of disputes under the contract and for the resolution of disputes relating to insurance. Maximum penalty: 40 penalty units in the case of a corporation and 20 penalty units in any other case. (2) This section does not apply to contracts of a class prescribed by the regulations. 7A Offence A person must not contract to do work under a contract unless the requirements of section 7 or 7AAA in relation to the contract are complied with. Maximum penalty: 80 penalty units in the case of a corporation and 40 penalty units in any other case.
2. None of those requirements were complied with by Mr Chan. Mrs Guan gave evidence and the Tribunal finds that she was not aware about the requirement for home warranty insurance until after contracting with the builder.
3. There are circumstances where the failure to provide information will constitute misleading or deceptive conduct. In Demagogue Pty Ltd v Ramensky & Anor (1992) 39 FCR 31, Black CJ said at p 32: Silence is to be assessed as a circumstance like any other. To say this is certainly not to impose any general duty of disclosure; the question is simply whether, having regard to all the relevant circumstances, there has been conduct that is misleading or deceptive or that is likely to mislead or deceive. To speak of 'mere silence' or of a duty of disclosure can divert attention from that primary question. Although 'mere silence' is a convenient way of describing some fact situations, there is in truth no such thing as 'mere silence' because the significance of silence always falls to be considered in the context in which it occurs. That context may or may not include facts giving rise to a reasonable expectation, in the circumstances of the case, that if particular matters exist they will be disclosed.
4. Further French CJ and Kiefel J said in Miller & Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd [2010] HCA 31; 241 CLR 357, referring to a similar provision of the Trade Practices Act state at [22]: However, as a general proposition, s 52 does not require a party to commercial negotiations to volunteer information which will be of assistance to the decision-making of the other party. A fortiori it does not impose on a party an obligation to volunteer information in order to avoid the consequences of the careless disregard, for its own interests, of another party of equal bargaining power and competence. In the case of Semrani v Manoun; Williams v Manoun [2001] NSWCA 337, Beazely JA provides a helpful summary of the cases on this point: 59 In Kimberley NZI Finance Ltd v Torero Pty Limited (approved by the Full Federal Court in Demagogue Pty Limited v Ramensky), French J said at 53,195: "The cases in which silence may be … characterised [as conduct in contravention of s 52] are no doubt many and various and it would be dangerous to essay any principle by which they might be exhaustively defined. However, unless the circumstances are such as to give rise to the reasonable expectation that if some relevant fact exists it would be disclosed, it is difficult to see how mere silence could support the inference that that fact does not exist." 60 Silence may more readily lead to a finding of breach of s 52 or s 42 where there is a duty of disclosure: see Winterton Construction Pty Limited v Hambros Australia Ltd per Hill J at 114; Warner v Elders Rural Finance at 404-405. 61 Although an intention to deceive is not necessary for the purposes of s 42: see Yorke v Lucas (1985) 158 CLR 661, Puxu Pty Ltd v Parkdale Custom Built Furniture Pty Ltd (1982) 149 CLR 191, a person cannot engage in conduct in contravention of the section unless the person has actual knowledge of the matter said to be misleading or deceptive: see Gurr & Gurr v Forbes (1996) 80 ATPR 41-491. 62 The combined effect of the Act and the authorities therefore, is that for Williams' silence to be actionable, he must have had actual knowledge of a matter which he intentionally refrained from telling Manoun in circumstances where there was either a duty to disclose or where Manoun had a reasonable expectation that such information would be disclosed to him.
5. The Tribunal is satisfied that to remain silent about the need for home warranty insurance could constitute misleading and deceptive conduct in some circumstances. S 92 of the HBA requires a contract of insurance before commencing residential building work and allows for the imposing of a penalty for either party in the event that the provision is not complied with. S 7 of the HBA, regulation 13 as they applied at the time the parties contracted required a contractor to provide information to the homeowner about the need for home warranty insurance and allowed for the imposition of a penalty if the contractor did not comply with the requirements. Given the regulatory regime of the Act, the Tribunal finds that in some circumstances where it can be demonstrated that the builder had actual knowledge that home warranty insurance was required to contract and did not disclose it to the homeowners then such silence can amount to misleading and deceptive conduct.
6. In Semrani v Manoun, her honour went on to explain that intention is not necessary, but actual knowledge is: Although an intention to deceive is not necessary for the purposes of s 42: see Yorke v Lucas (1985) 158 CLR 661, Puxu Pty Ltd v Parkdale Custom Built Furniture Pty Ltd (1982) 149 CLR 191, a person cannot engage in conduct in contravention of the section unless the person has actual knowledge of the matter said to be misleading or deceptive: see Gurr & Gurr v Forbes (1996) 80 ATPR 41-491.
7. The Tribunal is satisfied that Mr Chan had actual knowledge of the requirement for home warranty insurance which he refrained from telling Mrs Guan. Firstly Mr Chan is a licensed builder. Secondly in his statement of 27 September 2013, Mr Chan indicated at paragraph 16 that he gave Mrs Guan a blank copy of a contract soon after finalising the pricing of the quote and once he had confirmed the figures. Of course it is odd that he provided the contract after the works had clearly commenced and the parties had already contracted. However, it does demonstrate that Mr Chan was aware of his obligations under the HBA. Mr Chan provided Mrs Guan with a sample copy of a Master Builders Association contract (BC4) which made clear the requirements for home warranty insurance to be provided to the homeowner prior to the commencement of the works. The Tribunal is satisfied that Mr Chan knew of the requirement for home warranty insurance. The Tribunal also accepts the evidence of Mrs Guan that she did not become aware of the requirement of home warranty insurance until she researched it on the Office of Fair Trading website after the homeowner had contracted with the builder.
8. However, the Tribunal is not satisfied on the evidence given by Mrs Guan that the disclosure of the requirement of home warranty insurance would have made any difference in relation to her entering into the contract. It is clear from the evidence, in particular the pre-contractual negotiations between the parties that the primary concern of Mrs Guan was the price of the works and that the works were completed within the time agreed between the parties. It is conceded that Mr and Mrs Guan were under time constraints to have the renovations completed and to move into the premises because the lease on the premises they were renting was expiring. Even after Mrs Guan was given the blank home building contract she raised no issue in relation to the home warranty insurance with the builder. Neither Mrs nor Mr Guan gave evidence that they would not have entered the contract had they have known about the requirements of home warranty insurance. Considering the evidence in totality, the Tribunal finds no evidence that had Mr or Mrs Guan been told about the insurance requirements or that the builder could not obtain it that they would not have proceeded with the contract.
9. The Tribunal finds no conduct amounting to misleading and deceptive conduct by the Mr Chan and accordingly the homeowners claim is also dismissed in its entirety. T Simon Senior Member Civil and Administrative Tribunal of NSW 9 March 2016

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 28 April 2016