Habashy v Relpar Australia Pty Ltd trading as Wheelchairs Victoria (Civil Claims) [2006] VCAT 1912

1 As against the second respondent Bentleigh Bayside Community Health Service Inc., the proceeding is struck out for want of jurisdiction.

2 Bentleigh Bayside Community Health Service Inc. is removed as a respondent but is joined as an interested party pursuant to section 60 of the Victorian Civil and Administrative Tribunal Act 1998. The need for any further service upon it of the application is dispensed with.

3 The principal registrar is directed to require the parties to attend a compulsory conference before any Member, to allow half a day for the compulsory conference, and to arrange for an Arabic interpreter to attend to assist the applicant.

1 The applicant Boshra Habashy contracted polio as a very young child and is confined to a wheelchair. In 2002 an occupational therapist, Anne Gregory, somehow became involved in the task of obtaining a new electric wheelchair for him. Ms Gregory was employed or engaged by the second respondent, Bentleigh Bayside Community Health Service Inc. On 11 November 2002 she made written recommendations as to the features the new wheelchair should have. In October 2003 the first respondent, Relpar Australia Pty Ltd., which trades under the name Wheelchairs Victoria, supplied a new electric wheelchair for Mr Habashy. It rendered an invoice, addressed to him, on 30 October 2003 for $8,908.73. Of that sum, Mr Habashy contributed $400.00. Funding for the balance came from elsewhere.

2 Mr Habashy is dissatisfied with the wheelchair. His doctors have recommended that it be modified so that it has an adjustable foot rest and a different type of cushion. He cannot afford to pay for those modifications and has not been able to obtain funding to pay for them. He has reverted to his old wheelchair.

3 Mr Habashy commenced this proceeding against both respondents. (In his written application he named "City of Bayside", in error, as the second respondent. The error was corrected when, by an order dated 6 June 2006, Bentleigh Bayside Community Health Service Inc. was substituted as the second respondent.) The order he sought, according to his written application, was "exchange or replace wheelchair to comply with supplied specifications". It has not been made clear, either in the written application or otherwise, whether Mr Habashy's complaint is that the first respondent (Relpar) failed to manufacture the wheelchair in accordance with his requirements as communicated by Ms Gregory, or that the second respondent (the Health Service) through Ms Gregory communicated incorrect requirements.

4 On 6 June 2006, at a jurisdictional hearing, the Health Service applied orally for an order striking out the proceeding, as against it, for want of jurisdiction. It filed an affidavit of that date by John Turner, its chief executive officer. The jurisdictional hearing was adjourned, with a direction that any affidavit by Mr Habashy in reply should be filed and served by 27 June 2006. Mr Habashy did not file any affidavit.

5 The jurisdictional hearing resumed before me on 27 July 2006. Mr Habashy appeared in person. He was assisted by an Arabic interpreter. Mr Peter Macartney, an officer of the first respondent Relpar, represented it. Ms Forsyth of Counsel appeared, by leave, on behalf of the second respondent, the Health Service.

6 Ms Forsyth made a submission, supported by a written outline, that the Health Service did not supply services "in trade or commerce", that it therefore did not supply "services" as defined by the Fair Trading Act 1999, that there was no "consumer and trader dispute" between Mr Habashy and the Health Service because the dispute between them did not relate to the supply of "services", as defined, and so the Tribunal has no jurisdiction under Part 9 of the Act to hear and determine the claim insofar as it is made against the Health Service. I reserved my decision but gave Mr Habashy the opportunity to file and serve any written submission in reply by 17 August 2006. He did not file any written submission.

7 The facts which I have set out in the first two paragraphs of these reasons, and which I set out below, are taken from the material filed by Mr Habashy and attached to his written application (the facts in which material, for present purposes only, I assume to be true) and from the affidavit of Mr Turner.

8 The Health Service is incorporated under the Associations Incorporation Act 1987. It has a written constitution. Clause 2 of the constitution sets out the Health Services' purposes. They include:

"(a) To provide a range of accessible and culturally relevant health and support services, programs and resources ...... .

(b) To deliver and promote services which enable and support people to manage their health and continue living in their community.

(d) To provide a quality and integrated community health program offering a range of curative, remedial, rehabilitative, preventative, maintenance and educative services appropriate to local needs.

(j) To provide charitable services in accordance with section 51 (4)(a)(i) of the Associations Incorporation Act 1981."

9 Section 51(1) of the Associations Incorporation Act provides that an incorporated association shall not trade. Section 51(4)(a)(i) provides that the prohibition against trading does not apply to an incorporated association the predominant purpose of which is charitable.

10 Mr Turner deposed in his affidavit that 95% of the Health Service's funding is received from the Department of Human Services, and that the remainder of its funding comes from donations and contributions from community groups and from fees charged to clients; the fees are $8.50 per consultation for concession card holders, $10.00 for consultation for middle income earners and a full cost for high income earners. He also deposed that the Health Service may waive fees, and that he had been unable to ascertain whether Mr Habashy had been charged a fee for any consultation he had had with Ms Gregory or with the Health Service.

11 Part 9 of the Fair Trading Act empowers the Tribunal to hear and determine a "consumer and trader dispute", which in section 107 is defined (so far as is relevant to the present case) as a dispute or claim arising between a purchaser of goods or services and a supplier of goods or services in relation to a supply of goods or services.

12 To this point it has not been disputed that Relpar was the supplier of goods (the wheelchair) to Mr Habashy as a purchaser. But whether the Health Service supplied "services" to Mr Habashy is a matter of dispute.

13 In section 3 of the Fair Trading Act "services" is defined so as to include (emphasis added):

".... any rights ...., benefits, privileges or facilities that are, or are to be, provided, granted or conferred in trade or commerce.....".

14 The definition is expressed in terms of what it "includes" not in terms of what it "means". So it is not expressed as an exhaustive definition. At first sight the words quoted in the previous paragraph, limited by the phrase "in trade or commerce", are words that enlarge the scope of the concept of "services" beyond its ordinary meaning. No doubt the Health Service did provide "services" to Mr Habashy in accordance with that ordinary meaning. However, one cannot conceive of any services that could not be described as rights, benefits or facilities. What the Health Service provided to Mr Habashy, through Ms Gregory, certainly met the description of benefits or facilities. So, although the definition of "services" is not expressed as an exhaustive definition, in reality it is an exhaustive definition, and the phrase "in trade or commerce" limits its entire scope. In the result, benefits or facilities are not "services" as defined unless they are provided "in trade or commerce".

15 I refer to what I said in David v Vodafone Pty Ltd [2006] VCAT 289 as to the way in which the Court of Appeal has construed the phrase "in trade of commerce" in the definition of "services" in section 3:

26 The High Court in Concrete Constructions (NSW) Pty Ltd v Nelson [1990] HCA 17; (1990) 169 CLR 594 had to consider whether conduct complained of as having been misleading or deceptive in contravention of section 52 of the Trade Practices Act 1974 (Commonwealth) - the counterpart of section 9 of the Fair Trading Act - had occurred "in trade or commerce". Four justices of the Court stated (at p.604) that the section was concerned with conduct "in the course of....activities or transactions which, of their nature, bear a trading or commercial character". Only conduct of that kind was conduct which took place "in trade or commerce".

27 The definition of "services" in section 3 of the Fair Trading Act, which has importance for the operation of Part 9, does not focus upon conduct "in trade or commerce". It focuses instead on the provision, granting or conferring, "in trade or commerce", of rights, benefits, privileges or facilities. In Sigma Constructions (Vic) Pty Ltd v Maryvell Investments Pty Ltd [2004] VSCA 242, the Court of Appeal in Victoria considered whether the granting of a licence in respect of real property constituted "services" as defined in the Fair Trading Act so that a dispute about the licence agreement was a "consumer and trader dispute" which the Tribunal had jurisdiction under part 9 to determine. Batt JA, with whose judgment the other members of the Court agreed, said that the above statement by the High Court "may be taken as a safe guide" and went on to say (at para [22]):

"The provision, etc, of rights, etc, must be "in the course of ...activities or transactions which, of their nature, bear a trading or commercial character..."".

16 In my opinion the Court of Appeal's approach assumes (although it does not expressly confirm) the correctness of the proposition put in paragraph 14 above, namely, that in reality the definition of "services" is an exhaustive definition and the words of limitation, "in trade or commerce", limit the entire scope of the definition, so that unless something is done "in trade or commerce" it does not amount to "services".

17 In my opinion, the facts outlined above show that the activities of the Health Service are not activities which, of their nature, bear any trading or commercial character. In the first place, because the Health Service is an incorporated association, it is prohibited from trading unless its predominant purpose is charitable. One may readily assume, I consider, that the Health Service is not flouting the prohibition set out in section 51(4)(a)(i) of the Associations Incorporation Act, so that, insofar as it "trades" at all, it does so for a predominantly charitable purposes. In the second place, while the purposes set out in the constitution may or may not be wholly charitable purposes, they authorize activities the nature of which are beneficent and community-protective rather than trading or commercial. That is so whether or not a fee is charged for them.

18 Accordingly I uphold the submission that the Health Service was not a supplier of "services" to Mr Habashy, and will order that his claim as against the Health Service is struck out for want or jurisdiction.

19 My decision means that Mr Habashy will have to decide whether he is content to proceed with a claim against Relpar alone - which he may still do in this proceeding - or whether he wishes to pursue legal proceedings against Relpar and the Health Service at once - which he may only do by withdrawing this present proceeding and commencing a proceeding in a court.

20 Even though no order will now be made against the Health Service at a final hearing of the proceeding, its interests may nevertheless be affected by the outcome of the proceeding. Moreover, any resolution of this matter before it goes to a final hearing would, in my opinion, be more likely to be achieved if the Health Service were to remain involved in it as a party, although not as a respondent; so it is desirable that the Health Service be joined as a party even though it is no longer a respondent. Accordingly, I propose to make an order under section 60 of the Victorian Civil and Administrative Tribunal Act 1998 joining the Health Service as an interested party. I raised the question of such a joinder with Ms Forsyth, who did not oppose it.

21 Mr Habashy's situation requires a pragmatic outcome. He needs a new wheelchair or modifications to the wheelchair which Relpar supplied. I have a concern that the outcome of this proceeding, whatever it is, will not address that situation. The Tribunal can decide only whether Relpair has a liability in law to Mr Habashy, and make a monetary award if there is such liability. I suspect that the proper solution will be a socio-political situation, not a legal solution.

22 For that reason, I propose to order the principal registrar to require the parties (including the Health Service) to attend a compulsory conference pursuant to section 83 of the Victorian Civil and Administrative Tribunal Act 1998.

23 For the sake of completeness, and in acknowledgement of Ms Forsyth's very thorough submissions, I record that she referred me not only to the cases mentioned above but also to two decisions by Wilcox J of the Federal Court, E. v Australian Red Cross Society [1991] FCA 20; (1991) 99 ALR 601 and McMullin v ICI Operations Pty. Ltd. (unreported, 24 June 1997). Neither of them is directly to the point for present purposes. The first of them dealt with the phrase "in trade or commerce" in s.52 of the Trade Practices Act 1974 (Commonwealth) in a case where the respondent acted gratuitously. In the present case it is unclear whether the Health Service acted gratuitously when dealing with Mr Habashy. The second of them dealt with the definition of "services" in the Fair Trading Act of New South Wales but that definition is in different terms from the definition in the Victorian Act because it incorporates the concept of a "business"; the passages (on page 68 of the judgment) to which Ms Forsyth referred to dealt with whether the respondent was carrying on a "business".

24 The Tribunal will make the following orders:

(1) As against the second respondent Bentleigh Bayside Community Health Service Inc., the proceeding is struck out for want of jurisdiction.

(2) Bentleigh Bayside Community Health Service Inc. is removed as a respondent but is joined as an interested party pursuant to section 60 of the Victorian Civil and Administrative Tribunal Act 1998. The need for any further service upon it of the application is dispensed with.

(3) The principal registrar is directed to require the parties to attend a compulsory conference before any Member, to allow half a day for the compulsory conference, and to arrange for an Arabic interpreter to attend to assist the applicant.