Hills Motor Group Pty Ltd v Cochrane-Heikkila

NCAT Appeal Panel|2020-12-09

Introduction

This is an appeal from a decision of the Consumer and Commercial Division of the Tribunal (the Tribunal) dated 23 July 2020 (the Decision). The Tribunal ordered the appellant Hills Motor Group Pty Ltd (HMG) to pay the respondent, Mr Tristan Cochrane-Heikkila, $10,924.62 within 14 days.
On 20 August 2020, HMG filed a Notice of Appeal seeking an order that Mr Cochrane-Heikkila's application to the Tribunal be dismissed. HMG submits that the Tribunal unreasonably or unfairly rejected or did not give appropriate weight to HMG's evidence. In addition, HMG submits that the Tribunal erred in treating the evidence of a Service Manager of HMG, Mr Healey, as expert evidence. Finally, HMG submits that even if Mr Healey was an expert, he could not have given the opinion evidence that he did.
For the following reasons, we have decided that: 1. Leave to appeal should be refused; and 2. The appeal should be dismissed.

Nature of an appeal

Section 80 of the Civil and Administrative Tribunal Act 2014 (NCAT Act) sets out the basis upon which appeals from decisions of the Tribunal arise. That section states that an appeal may be made as of right on any question of law or with leave of the Appeal Panel on any other grounds (s 80(2)(b)).

A question of law

In Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69, the Appeal Panel considered the requirements which give rise to an appeal as of right. Without expressing exhaustively possible questions of law, the Appeal Panel in Prendergast referred at [13] to the following as constituting errors of law: 1. Whether there has been a failure to provide proper reasons; 2. Whether the Tribunal identified the wrong issue or asked the wrong question; 3. Whether a wrong principle of law has been applied; 4. Whether there was a failure to afford procedural fairness; 5. Whether the Tribunal failed to take into account a relevant (mandatory) consideration; 6. Whether the Tribunal took into account an irrelevant consideration; 7. Whether there was no evidence to support a finding of fact; 8. Whether the decision was so unreasonable that no reasonable decision-maker would have made it.

Leave to appeal

Clause 12 of Sch 4 of the NCAT Act states that an Appeal Panel may grant leave only if the Appeal Panel is satisfied the appellant may have suffered a substantial miscarriage of justice because: 1. The decision of the Tribunal under appeal was not fair and equitable; 2. The decision of the Tribunal under appeal was against the weight of evidence; or 3. Significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with).
In Collins v Urban [2014] NSWCATAP 17 the meaning of "substantial miscarriage of justice" was summarized at [71] and [79] as follows: [71] . . . [I]t can be seen that the concept of a substantial miscarriage of justice refers to a failure in the way a matter was conducted or decided which deprived the appellant of a chance that was fairly open of achieving a better outcome than occurred. . . . [79] In order to show that a party has been deprived of a "significant possibility" or a "chance which was fairly open" of achieving a different and more favourable result . . . it will be generally be necessary for the party to explain what its case would have been and show that it was fairly arguable. If the party fails to do this, even if there has been a denial of procedural fairness, the Appeal Panel may conclude that it is not satisfied that any substantial miscarriage of justice may have occurred."
The principles to be applied by an Appeal Panel in determining whether or not leave to appeal should be granted are well settled. In Collins v Urban [2014] NSWCATAP 17, the Appeal Panel conducted a review of the relevant cases at [65]-[79] and concluded at 84 that: (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.
As was further explained in Pholi v Wearne [2014] NSWCATAP 78 at [32]: Even if the appellant establishes that [they] may have suffered a substantial miscarriage of justice in the sense explained above, the Appeal Panel then retains the discretion whether to grant leave under s 80(2) of the Act (see Collins v Urban, supra at [80]-[84]). [The appellant] must demonstrate something more than that the Tribunal was arguably wrong. Leave is ordinarily granted only where the matter involves an issue of principle, questions of public importance, where the injustice is reasonably clear or where the Tribunal has gone about its fact finding process in such an unorthodox manner that it is likely to have produced an unfair result.

Grounds of Appeal

HMG submits that: 1. The Tribunal failed to apply the correct principles of law; 2. The Tribunal identified the wrong issue or asked the wrong question; 3. The Tribunal took into account irrelevant considerations; 4. The Tribunal made findings that were not open to be made.
The first three grounds are errors of law, for which leave of the Appeal Panel is not required. The fourth ground requires the Appeal Panel's leave.
HMG submits that these grounds arise in respect of two issues: 1. The Tribunal's acceptance and reliance on the evidence of Mr Healey; and 2. Whether there was any evidence that the vehicle purchased by the respondent from HMG was not of acceptable quality at the time of supply.
HMG says that the Decision was not fair and equitable. In support of this argument, HMG's principal submission is that: The Tribunal relied on an email from a Service Advisor, from ULR Jaguar Land Rover in Melbourne. The Tribunal considered the email from the Service Advisor expert evidence when it was not. No statement was provided from an expert. The Service Advisor was not presented as a witness for cross examination, as no statement was provided. There was no evidence to establish that the Service Advisor was a mechanic, had any relevant expertise, or had knowledge of the facts, circumstances or manner in which the vehicle had been driven during the period and over the 6000 km that Mr Cochrane-Heikkila owned the vehicle.
HMG also says that the Decision of the Tribunal was against the weight of the evidence. It says: The vehicle was sold with a Form 5 (Motor Dealers Notice for Motor Vehicles), Motor Dealers and Repairers Act 2013: Section 62, 63, 64 and 72. The vehicle had been sold with an independent New South Wales Roadworthy Certificate and had been independently inspected on 6 August 2019 and past [sic - passed] roadworthy requirements. Mr Cochrane-Heikkila had driven the car for over 6000 km after it was purchased, including from Sydney to Brisbane and then from Brisbane to Melbourne. The statutory warranty had expired. The vehicle was driven to Melbourne and the Appellant was not given a reasonable time or opportunity to inspect the vehicle or arrange for any necessary repairs, after inspection.
HMG submits that the Tribunal should have given more weight to its evidence, notes the absence of any independent testing by Mr Cochrane-Heikkila at the time of purchase and his evidence that he did not experience any problems with the vehicle during the period he owned it.

Reply to Appeal

Mr Cochrane-Heikkila says that HMG has no evidence to challenge the Decision. His principal written submissions are as follows: 1. He rejects the claim of HMG that Mr Healey was not an expert witness and that no statement was provided. He submits that Mr Healey has had many years of experience, and liaises with a team of trained, qualified mechanics. He says that ULR Jaguar Land Rover is a reputable factory dealership, authorised to carry out all repairs on behalf of Jaguar Land Rover. He says that Mr Healey's statement was provided in the documents made available to all participants at the first hearing. 2. There is no ability to appeal, except on a question of law, against a decision of the Consumer and Commercial Division where the appellant is a corporation and the appeal relates to a dispute in respect of which the Tribunal had jurisdiction.
We can deal with this second submission immediately. Mr Cochrane-Heikkila correctly notes that NCAT Guideline 1 on Internal Appeals makes this statement. While Guideline 1 states that there is no appeal except on a question of law where the appellant is a corporation, the Guideline also says that this is where the appeal relates to a dispute in respect of which the Tribunal had jurisdiction because of the operation of the Credit (Commonwealth Powers) Act 2010. As this appeal did not involve that Act, Mr Cochrane-Heikkila's submission on this matter should be rejected.
Mr Cochrane-Heikkila also says that there is evidence to suggest that HMG carries out unethical practices. This submission too should be rejected. This was not an issue in the proceedings.

Proceedings before the Tribunal

Mr Cochrane-Heikkila asked the Tribunal to order HMG, a licensed motor dealer, to pay him $10,924.62 for repairs undertaken to a motor vehicle he had purchased from HMG. He argued that he was entitled to that order because HMG failed to comply with the guarantee as to acceptable quality required by s 54 of the Australian Consumer Law.
The vehicle was purchased on 7 August 2019 for $40,000. At the time of purchase it had travelled 82,442 kilometres. Mr Cochrane-Heikkila claimed that a number of mechanical defects were identified when the motor vehicle was serviced on 8 October 2019 in Melbourne. He had the motor vehicle serviced as he was about to embark on a trip. The Decision at [18] states that Mr Cochrane-Heikkila was taking the motor vehicle from Melbourne to Queensland, but in his Reply to Appeal Mr Cochrane-Heikkila says he drove the motor vehicle to Byron Bay, and then back to Melbourne.
A number of mechanical issues were discovered during the service. Relevantly, the defects for which compensation was sought related to oil leaks. These were identified in a Repair Tax Invoice of ULR Range Rover dated 8 October 2019 as: "significant engine oil leaks from [the right hand] side turbocharger, oil sump pan oil level sensor, [right hand] rocker cover and the brake vacuum pump seal. Replacement of affected components required."
Mr Cochrane-Heikkila informed HMG of these matters the following day, 9 October 2019. He sought to return the motor vehicle and receive a full refund of the purchase price. HMG requested a photograph of the odometer and indicated that it would have their mechanic inspect the motor vehicle.
In a further email that day Mr Cochrane-Heikkila again sought to return the motor vehicle to HMG, and asked alternatively that HMG repair the motor vehicle in Melbourne.
In the absence of any further reply from HMG, Mr Cochrane-Heikkila had the motor vehicle repaired on 17 October 2020. The Tribunal identified these repairs in paragraph [27] as: "repairs to the vacuum oil pump oil seal, replacement of the engine oil sump gasket/s-sump pan, replacement of [the right-hand] side rocker cover and turbocharger, replacement of [the right-hand rear] door lock actuator and Bowden".
The Tribunal noted that Mr Cochrane-Heikkila relied on the Repair Tax Invoice dated 17 October 2019, referred to above. The Tribunal also referred to an email of Mr Healey, a Service Advisor with ULR Jaguar Land Rover, dated 18 December 2019. Relevantly that email states: As discussed, my personal and professional opinion on the state of the vehicle that you purchased recently . . . [is that it] was simply not fit for sale due to the fact that at the time you purchased it, it appears to have worn front brakes, worn front axle suspension bushes and multiple engine leaks. This vehicle would not have met Victorian Roadworthy Requirements in the condition that it was presented to us for the first time on 8/10/19. I suspect that the same would apply for the equivalent NSW road safety regulations/requirements. So again, in my opinion, yes, the car was not fit for sale at the time you purchased it, based on how the car appeared to us on 8/10/19.
After the hearing, the Tribunal published a 12 page written decision making the order sought. In summary, the Tribunal accepted what it described as "the expert opinion" of Mr Healey.

The evidence of Mr Healey

The primary issue in this appeal is the Tribunal's acceptance of Mr Healey as an expert and his evidence as expert evidence.
HMG submits that the evidence does not establish that Mr Healey: 1. Was an expert; 2. Adopted the Tribunal's expert code of conduct; or 3. Inspected the vehicle,
HMG also submits that no facts or assumptions were provided to Mr Healey including that: 1. The vehicle was sold with a NSW Roadworthy certificate; 2. Mr Cochrane-Heikkila drove the vehicle from Sydney to the Gold Coast and back to Melbourne; 3. Mr Cochrane-Heikkila did not experience or identify any problems or difficulties with the vehicle since purchase; 4. Mr Cochrane-Heikkila had driven the vehicle 6,292km in 2 months.
In addition, HMG claims that Mr Healey was not available for cross-examination.
Each of these matters are developed in HMG's written submissions, but we do not consider that the appeal should be upheld on this ground.
In relation to expertise, HMG submits, correctly, that Mr Healey's qualifications and experience were not before the Tribunal. However, as we note below, this matter was not raised before the Tribunal.
In relation to the code of conduct, HMG accepts that, as the claim was for less than $30,000, Tribunal Procedural Direction 3 relating to expert evidence did not apply.
In relation to the submission relating to the factual underpinning of Mr Healey's opinion, this is a matter that it was open to HMG to have taken at the Tribunal, but it did not do so.
As for failing to make Mr Healey available for cross-examination, there is no evidence before us to suggest that HMG required Mr Healey to be available for cross-examination.
The weight of these matters therefore militates against upholding the appeal on this ground.
But, finally, it is common ground that the matter of Mr Healey's expertise was not raised before the Tribunal. As the Appeal Panel noted in Bartel v Ryan [2018] NSWCATAP 231 at [25], the plurality of the High Court of Australia said in Coulton v Holcombe [1986] HCA 33 at [9] that it is elementary that a party is bound by the conduct of their case. Except in the most exceptional circumstances, it would be contrary to all principle to allow a party, after a case had been decided against them, to raise a new argument which, whether deliberately or by inadvertence, the party failed to put during the hearing when they had an opportunity to do so: see too Palm Homes Pty Ltd v Kav's Constructions Pty Ltd [2015] NSWCATAP 113 at [27].
Accordingly, we do not think it fair or appropriate that the question of Mr Healey's expertise be considered now.
In the circumstances, we do not consider that the appeal should be allowed on this ground.

Whether there was any evidence that the Vehicle was not of acceptable quality at the time of supply

In summary, HMG submits that: 1. The only evidence relied upon by the Respondent that the Vehicle was not of acceptable quality and that there was a "major failure" are the tax invoices from ULR Land Rover and Mr Healey's email of 18 December 2019. HMG says that these are not evidence of the state or condition of the vehicle in or on 7 August 2019; 2. The evidence of Mr Healey cannot be accepted or given any weight as Mr Healey did not inspect the vehicle in August 2019 and cannot give evidence as to the state of the vehicle at the date of purchase; 3. The only evidence of the condition of the vehicle as the time of purchase was a Road Worthy certificate. Mr Cochrane-Heikkila's evidence that he did not experience any problems with the vehicle while driving over 6,600 km including from Sydney to the Gold Coast (and here we note that Mr Cochrane-Heikkila says that he drove the vehicle to Byron Bay not the Gold Coast) and back to Melbourne confirms that the vehicle, which was a used vehicle with over 82,000 km on the odometer, was of acceptable quality at the time of supply.
In summary, HMG also contends that the Decision was not fair and equitable in considering the condition and state of the vehicle in October 2019, the Tribunal identified the wrong issue or asked the wrong question, failed to apply the correct principles of law in respect of when the condition of the vehicle was to be assessed, made findings that were not open to be made based on that evidence and took into account irrelevant considerations as a consequence of that evidence.
For the following reasons, we do not accept that submission.
In order to amount to an error of law, it must be demonstrated that there was no evidence to justify the conclusion of the Tribunal or, alternatively, that no reasonable tribunal could have come to the conclusion that it did: see John Prendergast & Vanessa Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69 at 13 and (8).
To the extent that HMG was asserting that the Tribunal's Decision was against the weight of the evidence or is not open to be made, leave to appeal is required under s 80(2) of the NCAT Act.
First, as the Tribunal noted at par [38], s 54 of the Australian Consumer Law (ACL) provides for a consumer guarantee of acceptable quality for goods supplied in trade and commerce. Goods are of acceptable quality if they are as fit for all the purposes for which goods of that kind are commonly supplied, they are acceptable in appearance and finish, and are free from defects, safe and durable. The test for these qualities is an objective one.
Sections 54(4) to (7) set out several bases upon which a supplier will not be liable for the supply of goods that are not of acceptable quality. Relevantly to the circumstances of this case, if the consumer to whom they are supplied causes them to become of unacceptable quality, or fails to take reasonable steps to prevent them from becoming of unacceptable quality.
HMG appears to be submitting that Mr Cochrane-Heikkila in some way caused the vehicle to become of unacceptable quality, but there is no evidence to support this. If so, HMG bears the evidentiary burden. We note the Tribunal at [49] of the Decision found, 'There is no evidence before the Tribunal that the applicant has caused the vehicle to become of unacceptable quality, or failed to take steps to prevent them from being of unacceptable quality (s 54(6) of the ACL)'. It also accepted the evidence of Mr Cochrane-Heikkila that he had not driven the motor vehicle off road and had only driven along the highway from Sydney to Byron Bay and then to Melbourne: at [49].
Not only did HMG not prove this, the evidence before the Tribunal demonstrates that on 7/8 October 2019, there were four "significant" engine oil leaks detected from the right hand side turbocharger, engine oil sump pan and oil level sensor, right hand rocker and the brake vacuum pump seal, all of which were replaced by 17 October 2019.
Accordingly, we see no real or cogent explanation for such major oil leaks so soon after purchase. An inference was available to be drawn by the Tribunal based on this evidence that such major oil leaks as presented on 7 October 2019 were present at the time of purchase in August 2019.
The Tribunal at [45] also relied on Mr Healey's opinion about the likely condition of the motor vehicle at the time of purchase based on his inspection of the vehicle some two months after purchase. For the reasons given, the Tribunal was entitled to rely on this evidence.
Given that there was evidence before the Tribunal in support of the conclusion that the motor vehicle was not of acceptable quality at the time of purchase, the Tribunal was entitled to draw the conclusion that it did. It is insufficient, for this ground of appeal, to succeed, that we, or another Tribunal Member, may have come to a different conclusion on the evidence. The key question is whether the finding of the Tribunal was open to it on the evidence, or whether the finding has any evidentiary basis: Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 at [355]-[356]; Ortiz v Minister for Immigration and Citizenship [2011] FCA 1498 at [53].
In our view, there was a reasonable basis, grounded in the evidence and inferences that could be drawn from the evidence, for the Tribunal to make the finding that it did in respect of condition of the vehicle when it was sold to the respondent.
For these reasons, we do not consider that the appeal should be allowed on this ground To the extent that leave to appeal is required, for the above reasons we refuse leave to appeal.

Orders

For the following reasons, the Appeal Panel orders: 1. Leave to appeal refused. 2. Appeal dismissed.

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: 20 January 2021

Australian Consumer Law Civil and Administrative Tribunal Act 2014(NSW)

Powers) Act 2010(Cth)

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Judgment (11 paragraphs)

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