Hayek v DockPro Pty Ltd

The statutory basis for the appeal

1. These appeal proceedings are governed by Section 80 of the Civil and Administrative Tribunal Act ("the Act"), which is in the following terms; 80 Making of internal appeals (1) An appeal against an internally appealable decision may be made to an Appeal Panel by a party to the proceedings in which the decision is made. Note. Internal appeals are required to be heard by the Tribunal constituted as an Appeal Panel. See section 27 (1). (2) Any internal appeal may be made: (a) in the case of an interlocutory decision of the Tribunal at first instance - with the leave of the Appeal Panel, and (b) in the case of any other kind of decision (including an ancillary decision) of the Tribunal at first instance - as of right on any question of law, or with the leave of the Appeal Panel, on any other grounds. (3) The Appeal Panel may: (a) decide to deal with the internal appeal by way of a new hearing if it considers that the grounds for the appeal warrant a new hearing, and (b) permit such fresh evidence, or evidence in addition to or in substitution for the evidence received by the Tribunal at first instance, to be given in the new hearing as it considers appropriate in the circumstances.
2. However, section 80 is qualified in the circumstances of these proceedings by Schedule 4 to the Act, which contains provisions concerning the Consumer and Commercial Division of this Tribunal, in which the decision under appeal was heard. Clause 12 of that schedule provides as follows; 12 Limitations on internal appeals against Division decisions (1) An Appeal Panel may grant leave under section 80 (2) (b) of this Act for an internal appeal against a Division decision only if the Appeal Panel is satisfied the appellant may have suffered a substantial miscarriage of justice because: (a) the decision of the Tribunal under appeal was not fair and equitable, or (b) the decision of the Tribunal under appeal was against the weight of evidence, or (c) significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with). Note. Under section 80 of this Act, a party to proceedings in which a Division decision that is an internally appealable decision is made may appeal against the decision on a question of law as of right. The leave of the Appeal Panel is required for an internal appeal on any other grounds. (2) Despite section 80 (2) (b) of this Act, an internal appeal against a Division decision may only be made on a question of law (as of right) and not on any other grounds (even with leave) if: (a) the appellant is a corporation and the appeal relates to a dispute in respect of which the Tribunal at first instance had jurisdiction because of the operation of Schedule 3 to the Credit (Commonwealth Powers) Act 2010, or (b) the appeal is an appeal against an order of the Tribunal for the termination of a tenancy under the Residential Tenancies Act 2010 and a warrant of possession has been executed in relation to that order.
3. Accordingly, in determining whether to grant leave to appeal we are concerned firstly whether the decision under appeal was against the weight of the evidence and whether, thereby, the appellant may have suffered a substantial miscarriage of justice.
4. Some amplification of the matters with which we are concerned is to be found during the course of a consideration of these statutory provisions by an Appeal Panel of this Tribunal in Collins v Urban [2014] NSWCATAP 17. After referring to the specific provisions the Appeal Panel said at [77] and [78]; As to the particular grounds in cl 12(1)(a) and (b), without seeking to be exhaustive in any way, the authorities establish that: (1) If there has been a denial of procedural fairness the decision under appeal can be said to have been "not fair and equitable" - Hutchings v CTTT [2008] NSWSC 717 at [35], Atkinson v Crowley [2011] NSWCA 194 at [12]. (2) The decision under appeal can be said to be "against the weight of evidence" (which is an expression also used to describe a ground upon which a jury verdict can be set aside) where the evidence in its totality preponderates so strongly against the conclusion found by the tribunal at first instance that it can be said that the conclusion was not one that a reasonable tribunal member could reach - Calin v The Greater Union Organisation Pty Ltd [1991] HCA 23; (1991) 173 CLR 33 at 41-42, Mainteck Services Pty Limited v Stein Heurtey SA [2013] NSWSC 266 at [153]. If in either of those circumstances the appellant may have been deprived of a "significant possibility" or a "chance which was fairly open" that a different and more favourable result would have been achieved then the Appeal Panel may be satisfied that the appellant may have suffered a substantial miscarriage of justice because the decision was not fair and equitable or because the decision was against the weight of the evidence.
5. In dealing generally with the question of leave to appeal after reviewing a number of authorities the Appeal Panel said, at [84]; The general principles derived from these cases can be summarised as follows: (1) In order to be granted leave to appeal, the applicant must demonstrate something more than that the primary decision maker was arguably wrong in the conclusion arrived at or that there was a bona fide challenge to an issue of fact: BHP Billiton Ltd v Dunning [2013] NSWCA 421 at [19] and the authorities cited there, Nakad v Commissioner of Police, NSW Police Force [2014] NSWCATAP 10 at [45]; (2) Ordinarily it is appropriate to grant leave to appeal only in matters that involve: (a) issues of principle; (b) questions of public importance or matters of administration or policy which might have general application; or (c) an injustice which is reasonably clear, in the sense of going beyond merely what is arguable, or an error that is plain and readily apparent which is central to the Tribunal's decision and not merely peripheral, so that it would be unjust to allow the finding to stand; (d) a factual error that was unreasonably arrived at and clearly mistaken; or (e) the Tribunal having gone about the fact finding process in such an unorthodox manner or in such a way that it was likely to produce an unfair result so that it would be in the interests of justice for it to be reviewed, BHP Billiton Ltd v Dunning [2013] NSWCA 421 at [20] and the authorities cited there, SAB v SEM [2013] NSWSC 253 at [8] and [9] and the authorities cited there, Nakad v Commissioner of Police, NSW Police Force [2014] NSWCATAP 10 at [45]; (3) In relation to an application for leave to appeal relating to a question of practice and procedure, the application is to be approached with the restraint applied by an appellate court when reviewing such decisions, especially if the application is made during the course of a hearing: BHP Billiton Ltd v Dunning [2013] NSWCA 421 at [21] and the authorities cited there.
6. For our purposes, we find of particular assistance the observations in Collins v Urban extracted in [13] above and the reference to the fact-finding process referred to in [14] above. We shall refer to these matters later when dealing with the merits of the appeal.

The decision under appeal

1. In her decision the Member recited the factual background referred to above and correctly identified that the resolution of the controversy depended upon whether the appellant had established his case to the effect that firstly, the respondent was responsible for obtaining approvals and secondly, at all relevant times the respondent through its representative Mr Jenkin stated that it was not necessary that approvals be sought because there were other sea pens which had been installed in the area and there was no need to obtain approval.
2. In order to resolve this matter, the Member was required to determine whether she would accept the statement and documentation of the appellant or that of the respondent. In preferring the respondent's version of what occurred the Member relied firstly on the fact that the respondent's documentation always contained reference to the necessity for the purchaser to acquire relevant approvals and secondly on the existence of "contemporaneous" business records consisting of the notations made by Mr Jenkin. She said that she preferred, in particular, the business records over the recollection of the appellant. Although she did not suggest that the appellant was "in any way dishonest" the Member referred generally to the fallibility of human memory in recalling conversations, especially against the context of litigation. The Member said that she had no doubt that the appellant "believes what he now recalls is reliable. However, I bear in mind what McClelland CJ in Eq said in Watson v Foxman (1995) 49 NSW LR 315 at 318 about the fallibility of human memory as to what was said in conversations, especially where disputes or litigation intervene. His Honour pointed out "The processes of memory (may be) overlaid, often subconsciously by perceptions of self-interest as well as conscious consideration of what should have been said or could have been said." In these circumstances contemporaneous business records are likely to be more reliable than the unsupported recall of an interested party after the dispute has arisen."
3. With respect, these observations concerning the fallibility of human memory must be considered in the overall context of the evidentiary material lead in the proceedings. It is not sufficient to refer to written material on the one hand and oral evidence as to recall on the other hand and say that prima facie the former is to be believed in preference to the latter. Before advocating any preference, it is necessary to carefully evaluate the written material and the circumstances in which it was produced before determining that it is to be preferred over oral evidence of recall.
4. We prefer the observations of Garling J in the Supreme Court of NSW in Gersbach v Gersbach [2018] NSWSC 1685. His Honour said at [368-392]; Almost 30 years ago, McHugh J addressed the fallibility of memory in Longman v The Queen [1989] HCA 60; (1989) 168 CLR 79. At p.107 he said: "17. The fallibility of human recollection and the effect of imagination, emotion, prejudice and suggestion on the capacity to 'remember' is well documented. The longer the period between an 'event' and its recall, the greater the margin for error. Interference with a person's ability to 'remember' may also arise from talking or reading about or experiencing other events of a similar nature or from the person's own thinking or recalling. Recollection of events which occurred in childhood is particularly susceptible to error and is also subject to the possibility that it may not even be genuine: Hunter, Memory, rev. ed. (1964), pp.269-279. 18. No matter how honest the recollection of the complainant in this case, the long period of delay between her formal complaint and the occurrence of the alleged events raised a significant question as to whether her recollection could be acted upon safely. The likelihood of error was increased by the circumstances in which the complainant said the incidents occurred. The opportunity for error in recalling, twenty years later, two incidents of childhood which are alleged to have occurred as the complainant awoke, and then pretended to be asleep, are obvious. Experience derived from forensic contests, experimental psychology and autobiography demonstrates only too clearly how utterly false the recollections of honest witnesses can be. ..." In MacKenzie v The Queen [1996] HCA 35; (1996) 190 CLR 348, the High Court set aside a conviction on two counts of perjury under s 327 of the Crimes Act 1900 (NSW). The conviction was set aside because of a failure by the trial judge to give a direction which the Court found ought to have been given. That direction was said to require the trial judge to explain to the jury how they should differentiate between the giving of evidence honestly although mistakenly on one hand, and the giving of false evidence dishonestly on the others. The basis for this conclusion was that problems identified in courts over time have occurred: "... not because witnesses have deliberately given false evidence to police, and later to courts, but because it is an elementary feature of human psychology, ... to carry a 'true mistake ... through with ... conviction'. " The judgment of the plurality (Gaudron, Gummow and Kirby JJ) cited with approval the decision of the Full Court of the Supreme Court of Victoria in R v Dickson [1983] VicRp 19; [1983] 1 VR 227 at 231, where it was said: "[I]t is essential to distinguish between honesty and accuracy and not assume the latter because of belief in the former." The plurality remarked that the converse was also true. In my view, the existence of the phenomenon of a false memory is a matter of forensic reality. The absence of it being regarded as an established and recognised psychiatric syndrome does not detract from this conclusion. Whether or not the histories of the sexual assaults recounted by the plaintiff, and the evidence which she gave about the conduct of the defendant towards her, are accurate is not a matter which depends upon her honesty. It is a matter, so it seems to me, which is to be judged by a careful consideration of all of the surrounding facts, matters and circumstances, including the assessment of the extent of the consistency or inconsistencies in the accounts which the plaintiff has given. In undertaking such a consideration, it is inevitable that the "subtle influence of demeanour" will have an impact upon any determination which the Court makes: Jones v Hyde [1989] HCA 20; (1989) 63 ALJR 349 at [18] per McHugh J.
5. In determining this matter, it is important to undertake a "careful consideration of all of the surrounding facts, matters and circumstances, including the assessment of the extent of the consistency or inconsistencies in the accounts "given by the parties. Importantly for the purpose of these proceedings there was only a short period between the events about which the appellant gave evidence, and the date upon which he gave that evidence. No such consideration was undertaken by the Member, and in failing to do so she fell into error. It will be necessary for us to undertake that exercise in determining the outcome of these proceedings.

The submissions of the parties

1. During the course of the appeal proceeding we identified with the concurrence of the parties that the fundamental matter to be determined was whether or not the appellant had made out his case before the Member which in turn was dependent upon whether his account of what occurred was to be preferred to that given by the respondent. On the one hand, there exists the documents created by the appellant and his oral evidence concerning his interaction with Mr Jenkin. On the other hand, the respondent relied upon documentation which it created and the one notation made by Mr Jenkin as contained in its records. The outcome of these deliberations would determine whether the appellant was successful in demonstrating, as he asserted, that the decision of the Member under appeal was against the weight of the evidence and should therefore be set aside.

Conclusion - the decision was against the weight of the evidence

1. The appellant has always consistently asserted that from the moment he met Mr Jenkin at the boat show, and at all times thereafter when he had any involvement with him, Mr Jenkin advised him that it would not be necessary to seek approval because there were many other boat pens in the area and, this was repeated before he remitted the purchase monies. The appellant's email communications with the accompanying photographs which he sent to Mr Jenkin all made reference to the necessity for the sea pen to comply with all sea and maritime regulations. This appears to us to have been a plausible situation. As the appellant explained during the course of submissions, he had had no experience with sea pens, and was reliant entirely on the expertise of the respondent's representative. Tellingly, the respondent never issued any document, whether by email or otherwise which rebutted the appellant's assertions contained in his emails that "installation must be complying with all sea and maritime regulations."
2. Seen in this way, the respondent through Mr Jenkin made a representation to the appellant to the effect that it was not necessary to seek any approval for the installation of the sea pen. The appellant was induced to enter into his contract with the respondent by this representation made on several occasions. The content of the appellant's emails is corroborative of this scenario.
3. In addition, the appellant was careful to challenge Mr Jenkin on each occasion on which he received documentation issued by the respondent which was contrary to what he understood to have been the representation made. He said that he had a conversation with Mr Jenkin on each such occasion and was informed that this was a "standard disclaimer" which the appellant could ignore.
4. The respondent relied upon the documentation which it had issued which contained material eschewing responsibility for the obtaining of consents. However, on each occasion that documentation was issued the appellant challenged Mr Jenkin, as we have referred to above. There is simply no evidence from the respondent challenging what the appellant said was the substance of his conversations with Mr Jenkin.
5. We note that the notation made by Mr Jenkin on 10 August 2016 is equivocal. Although there is a reference to him speaking about the approvals of installations by the respondent, there is also a reference to "but we have them in the area near." There is no evidence that Mr Jenkin informed the appellant either orally or in writing that the appellant was responsible for obtaining the necessary approvals. The fact that there is a reference to this in the respondent's own records is not per se indicative that this was a matter communicated by Mr Jenkin to the appellant. As we have previously observed, there does not exist any evidence in these proceedings about what Mr Jenkin said to the appellant other than the evidence of the appellant himself. The next notation is dated 8 February 2017 after the controversy had arisen and it is telling that the particular reference to responsibility for approvals was added specifically by Mr Jenkin at the beginning of the notation. This may be explicable as being a self-serving notation.
6. We repeat that Mr Jenkin did not give evidence, there is information available to the effect that the respondent was at all times aware of his contact details, and the respondent proffered no explanation as to why Mr Jenkin did not give evidence.
7. In our opinion the conclusion expressed by the Member that she preferred the respondent's version to that of the appellant was against the weight of the evidence. The only person who was privy to the conversations with the appellant was Mr Jenkin. No reason has been advanced by the respondent as to why it declined to require him to give evidence, or, at the least, to provide a written statement from him. The failure to adduce any evidence of any kind from Mr Jenkin about matters which were crucial to the determination of these proceedings would in most circumstances justify a conclusion that it is more likely than not that his evidence would not assist the respondent in rebutting the version of events as related by the appellant. In all the circumstances our view of the evidence before the Member is that it leads overwhelmingly to the conclusion that overall the evidence of the appellant is to be preferred to any evidentiary material adduced by the respondent in its favour. This leads to the further conclusion that the decision of the Member was against the weight of the evidence.

The disposition of the appeal

1. Once it has been determined that the decision under appeal was against the weight of the evidence it is then necessary for us to consider whether, as a result, the appellant may have suffered a substantial miscarriage of justice. This will in turn involve a consideration of whether "the appellant may have been deprived of a "significant possibility" or a "chance which was fairly open" that a different and more favourable result would have been achieved" as referred to in Collins v Urban extracted above.
2. It is obvious that if the decision under appeal was against the weight of the evidence, as we have found, it is more likely than not that the evidence of the appellant would have been preferred to that given on behalf of the respondent. In these circumstances it may be assumed that it is more likely than not that the appellant might have succeeded in establishing circumstances which would prima facie entitle him to a refund of his purchase price, on the basis that the relevant statutory approvals were not capable of being obtained. Of course, this might arguably have been accompanied by the creation of concurrent rights and obligations to allow the respondent to remove the sea pen from the appellant's premises.
3. We conclude that the appellant has accordingly suffered a substantial miscarriage of justice in that he has been deprived of a significant possibility, and a chance which was fairly open to him to succeed in the proceedings which were before the Member.
4. For these reasons we conclude that the appellant should be granted leave to appeal.
5. It then becomes necessary to determine whether to deal with the final disposition of the matter pursuant to section 80 (3) (a) of the Act or remit the matter to the Tribunal for further hearing.
6. We note that the factual basis to the appellant's claim was fully ventilated in the hearing before the Member, and that neither party sought to adduce any fresh evidence before us. Indeed, given the reticence of Mr Jenkin to give any evidence it seems clear that the parties have exhausted such evidence as they wished to produce for the purpose of the resolution of these proceedings.
7. Given these circumstances, and given the statutory exhortation that this Tribunal must "facilitate the just, quick and cheap resolution of the real issues in the proceedings" as provided for in section 36 of the Act, it is appropriate that we determine the proceedings on the basis of the evidentiary material before the Member, but considered on the basis that we have determined is the correct approach. The nature of the evidence, which we have previously discussed in detail is that it may comfortably be concluded that the appellant has established that at the time that he entered into the contract with the respondent he did so on the basis that the respondent would be responsible for ensuring that the installation complied with all relevant statutory requirements. We also find that Mr Jenkin did not displace that understanding. On this basis we would conclude that during the course of the negotiations undertaken as part of the process leading up to a final offer to enter into a contract accompanied by a final acceptance of that contract, a contractual term was incorporated to the effect that the installation would comply with all relevant statutory requirements, which, as we know, did not occur. Accordingly, there was a breach of a fundamental provision of the contract by the respondent which would entitle the appellant to a refund of the purchase monies.
8. There is an alternative basis upon which the appellant is entitled to succeed. On the evidence which we accept, the respondent through Mr Jenkin represented to the appellant prior to the entry into the contract that there was no necessity for the appellant to seek and obtain approval for the installation of the sea pen. It was on the basis of this representation that the appellant entered into the contract. In these circumstances it would be unconscionable for the respondent to seek to now argue to the contrary whether by relying on the printed disclaimer or otherwise, and it should be estopped from doing so. In these circumstances the appellant would be entitled to a refund of the purchase monies.
9. During the course of the proceedings we discussed with the parties the current situation concerning the whereabouts of the sea pen. We were informed that it was removed from the water by the respondent in circumstances which have created further controversy between them. After sensible discussion both parties informed us that they agreed that if the appeal were to succeed and the appellant be awarded a refund of the purchase price, the respondent would not make any claim against the appellant for recovery of possession of the sea pen, and the appellant would not make any claim against the respondent seeking the removal of the sea pen from his property. We propose to incorporate this agreement into our orders.

Orders

1. We make the following orders; 1. leave to appeal is granted 2. the appellant's appeal is upheld 3. the respondent is to pay the appellant the sum of $24,000 within 21 days of this date 4. the Tribunal notes the agreement reached between the parties that the respondent will not make any claim against the appellant for recovery of possession of the sea pen, and the appellant will not make any claim against the respondent seeking the removal of the sea pen from his property.

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: 30 November 2018