The prescribed amount was $25,000.
9 The claim lodged by the builder specified two sets of items, one of additional items being an unpaid total of $20,558, and the other of unpaid construction variations having a total of $22,328. The two sums totalled $42,886. Handwritten on the last page of the claim were the words, "We are limiting this claim to $25,000 if heard by the Consumer Claims Tribunal" .
10 Counsel for Mr and Mrs Hamilton, Mr M Cohen, referred to the words "the total of" in s 32 and submitted that the total was $42,886 and that the Consumer Claims Tribunal had no express or implied power to allow a claimant to abandon that part of the claim which exceeded the prescribed amount.
11 In my opinion, the Consumer Claims Tribunal had jurisdiction as the sum claimed was within the jurisdictional limit, notwithstanding that the elements making up the claim may have exceeded that sum.
12 In a recent case, Batshon v Elias & Ors (unreported, 3 June 1999), I dealt with an analogous issue. I there referred to the definition of a "consumer claim" under s 3 of the Act and of a "building claim" under s 12A of the Act, both of which included the words "the payment of a specified sum of money". I went on to say:
"Wide and general words are used in the definition of 'consumer claim' and of 'building claim'. It is therefore not surprising that the words 'a specific sum of money' which appear in those definitions have been given a wide reading. In W D & H O Wills Australia Ltd v Consumer Claims Tribunal (NSW) & Anor (unreported, Court of Appeal, 23 July 1998), the term was held to encompass a claim for a specified, that is, nominated sum, notwithstanding that the amount was claimed by way of unliquidated damages. Similarly in Hales v Consumer Claims Tribunal & Anor (1990) ASC 55-985 and in Sandford v Marjen Building Contractors Pty Ltd (1992) ASC 56-148 the term was held to encompass a net sum due after taking into account items on both sides of the ledger.
It matters not that the quantum of the various issues to be considered exceeds the jurisdictional limit of the Tribunal, $25,000, provided that the sum that is sought in the claim is within the jurisdictional limit. This was made clear by Allen J in Hales when his Honour said at 58,855:
'It is apparent, therefore, that the jurisdiction is related to the nature of the relief sought by the consumer rather than the cause of action upon which that claim was founded.'
In Sandford Grove J said at page 57,451:
'The jurisdiction of the Tribunal is, as the provisions I have set out show, limited by the order it can make not by the value of the ingredients of the dispute from which proceedings originated.'
It follows that a claim must specify a sum which is within the jurisdictional limit of the Tribunal; but it matters not that the value of the elements making up the claim may exceed the jurisdictional limit of $25,000, if that sum is within the jurisdictional limit. As Stein JA, with whom Mason P and Meagher JA agreed, in Wills said at page 8:
'It [the claim] has to be for the payment of a specified sum of money. The requirement is satisfied if a sum of money is specified in the claim and is within the jurisdictional limit of the Tribunal.'
In Archcom Limited v Consumer Claims Tribunal & Ors , (unreported, Administrative Law Division, 29/9/95) Simpson J made the same point when her Honour said at page 16:
'Whether jurisdiction exists must be determined by reference to the 'claim' made by the claimant ... 'Claim' is to be equated with what is asserted by the claimant; that is what the claimant, rightly or wrongly asserts. Jurisdiction depends upon the correct analysis of the assertion made by the claimant in the claim form.'
Provided that a claim asserts on its face a building claim as defined, and provided that the sum specified in the claim is within the jurisdictional limit, the Tribunal will have jurisdiction."
13 In that case, it was held that the Consumer Claims Tribunal had jurisdiction where a claim, as it was in this case, was made up of credits and debits but the sum of which payment was sought was $25,000 or less. In the present case, the sum specified as the sum of which payment was sought was within the prescribed limit. That ground of attack therefore fails.
14 The other ground taken is that the Tribunal failed to accord natural justice to Mr and Mrs Hamilton. The affidavit of Mr Hamilton annexed five progress claims which showed no sum against the item "Variations" . A letter dated 18 May 1998 from the builder to Mr and Mrs Hamilton, which was also attached to the affidavit, annexed a list of variations which totalled $22,328, which was one part of the total items claimed in the proceedings before the Tribunal.
15 Mr Hamilton said in his affidavit that he had informed the Tribunal that the claim for extras and the variations had been neither authorised nor agreed. In that respect, Mr Hamilton referred to a paragraph of the contract which required that variations be signed by the contractor and the owner. By way of example of Mr Hamilton's affidavit, I set out para 4:
"During the hearing before the Defendant Tribunal, I made submissions to the Referee that, in respect of the alleged variations claimed by Warrington , Warrington had failed to comply with its obligations under clause 11 the Building Contract and also Section 10 Home Building Act, in that it had never inform us of the variations prior to commencing the work, had never submitted to us any quotation, estimate or account for the work prior to commencing the work and had never obtained any consent, written or oral, to carry out those works. By failing to provide this notice, my wife and I were denied the opportunity of deciding whether to have the variations carried out, or to otherwise negotiate or quantify the costing for the work. I also submitted to the Referee that much of the work claimed to be variations by Warrington, was in fact work which was included in the base contract price for the dwelling."
16 The matters referred to in Mr Hamilton's affidavit were only a part of the material before the Tribunal. No attempt has been made by either party to set out the material on which the Tribunal's finding, that there were fourteen extras, seven deductions and two credits, as specified and valued by the Tribunal, was based. Mr Hamilton's affidavit raised no specific matter of procedure about which complaint was made. It was not suggested that, in the course of the hearing, Mr and Mrs Hamilton were taken by surprise or were not given an opportunity to say all that they wished to say.
17 The case as put by Mr Cohen for the plaintiffs was that the reasons of the Tribunal were deficient in that they failed to discuss the issues, including the significance of clause 11 of the Building Contract, and that it was impossible to determine from the reasons for decision what was the basis upon which the Tribunal came to its findings.
18 Mr Cohen referred to State Rail Authority of New South Wales v Consumer Claims Tribunal & Ors (1988) 14 NSWLR 473 in which it was held that the Consumer Claims Tribunal was a court exercising judicial power in disputes arising under contracts for the supply of goods and services. Mr Cohen relied upon the words of Hope JA at p 479 where his Honour said:
"As appears from these provisions and from the decision in Cachia v Isaacs (1985) 3 NSWLR 366, the tribunal must resolve issues which are in dispute, and must keep a record of those issues as well as a record of its decision upon them. Despite the power given to the tribunal to decide to make orders which are fair and equitable, including orders other than for the payment of money (although in due course the claimant may be forced back to such an order), the tribunal cannot fix the amounts of the payments or determine the nature of the other acts to be performed otherwise than on the basis of the evidence before it and the contractual rights and obligations of the parties; the tribunal does not exercise 'palm-tree justice'. It is a court exercising judicial power, with the duties upon it and the consequences to the parties that such a power and the exercise of it involves. It is a jurisdiction which can, within its prescribed limits, be regarded as a jurisdiction of a court to resolve issues arising under contracts for the supply of goods or services."
19 Despite the submissions of Mr Dwyer, counsel for the builder, to the contrary, I agree with Mr Cohen that one cannot tell from the reasons for decision what was the basis upon which liability was found. I assume that the Tribunal found that the extras and variations were authorised and that the builder was entitled to succeed on a quantum merit: see Pavey & Matthews Pty Ltd v Paul (1987) 162 CLR 221. Nevertheless, the reasons simply disclose the Tribunal's ultimate findings, not the reasons for them. The reasons do not satisfy the tests discussed in many cases, clearly for example in Mifsud v Campbell (1991) 21 NSWLR 725.
20 Notwithstanding the direction given by s 34A of the Act, that the reasons for decision should be "as brief as is reasonably practicable in the particular case" , I think it is important in the interests of justice that the parties should be able to understand from the reasons for the decision what were the basic findings of fact on which the decision was based and on what principles of law liability was found.
21 Mr Cohen submitted that, in the circumstances, the Tribunal had not provided justice in the sense described by Hope JA in the passage I have set out above. He submitted that the Tribunal had failed to provide natural justice to Mr and Mrs Hamilton.
22 In my opinion, s 12 of the Act does not extend to a case such as the present. A failure to give adequate reasons has been held in many cases to be an error of law, and in circumstances where there is jurisdiction to set aside a decision on such a ground, decisions have been set aside for lack of reasons. But the issue in the present case is not whether there was any error of law, for that is not a ground specified in s 12(2)(b) of the Act. The question is whether there was a failure to accord natural justice to Mr and Mrs Hamilton.
23 In my opinion, the words "natural justice" relate to procedural fairness. The reasons for decision on the other hand go to the substance of the case. A failure to give reasons is held to be an error of law because it is tied up with the question as to whether an error of law exists in the decision. Courts consider that adequate reasons should be given so that the parties may understand the decision and so that an appellate court or a court of judicial review may determine whether or not the decision erred in law.
24 Procedural fairness, however, is concerned with a different matter; it is concerned with giving the parties a fair go in the hearing, enabling them to understand what are the issues to which they should direct their attention, and giving them a fair opportunity to put their case.
25 The view which I have just expressed was also expressed by Simpson J in Archcom Pty Ltd v Consumer Claims Tribunal & Ors (unreported, 29 September 1995) , where her Honour discussed a similar issue. Her Honour said:
" There is some authority for the proposition that the obligation to give reasons is an incident of the obligation to accord natural justice: Xuereb v Viola (1989) 18 NSWR 453 at 469, per Cole J.