Hooper v Peet

NCAT Appeal Panel|2020-10-29

Introduction

This is an appeal from a decision made in the Consumer & Commercial Division of the Tribunal published on 15 July 2020 after a hearing which occurred on 21 April 2020. The Tribunal ordered the Appellant to pay to the Respondent (who was the Applicant at first instance) the sum of $40,000.
The Tribunal was exercising its jurisdiction to determine consumer claims under the Fair Trading Act 1987 (NSW).
The Appellant seeks an order that the order for payment referred to above be set aside and, in addition, that the Respondent's application be dismissed.
The background to the dispute is that the Respondent delivered two horses (Roxy, a mare and Benji, a gelding) to the Appellant at the Appellant's property so that the horses could be placed there on agistment from 30 August 2018. On or about 1 September 2018 an incident occurred involving an electric fence which resulted in Roxy colliding with a fence post fracturing her shoulder. She was euthanised by a veterinary surgeon. The Respondent claimed compensation for the loss of the Roxy.
In the Respondent's application by which the proceedings in the Consumer & Commercial Division were initiated, the Respondent alleged that she and the Appellant had had an agreement for her two horses to be placed on agistment with the Appellant. She further alleged that the Appellant was negligent and set out the particulars which she alleged constituted the negligence.
Neither the application nor the decision under appeal referred to the possibility that there was a bailment between the parties by which the Respondent as bailor delivered the two horses to the Appellant as bailee. Such an arrangement, if it had been established in the proceedings might have affected the question of which party had the onus of proof .
Below we will summarise the decision under appeal (which will which we will refer to as the Decision).

Decision under appeal

The Decision may be summarised as follows: 1. The Decision recited the contentions of the Respondent and of the Appellant. The Respondent had alleged that there an oral agreement between the parties, requiring her to pay $20 per day per horse for the agistment together with "usual arrangements" that had been customary between the parties previously. The Respondent alleged that it was a term of the agreement that the two horses be kept in separate paddocks. She further alleged that Roxy, a mare measuring 16 hands was not accustomed to electric fencing. She further alleged that the two horses were placed in the same paddock albeit separated by a temporary electric fence measuring approximately 900 mm in height. 2. The Respondent put forward valuation evidence in the form of an assessment by Daniella Dierks. 3. The Appellant's evidence was that there was no agreement for a fee to be paid and that she was providing free agistment. Her evidence was also to the effect that she and the Respondent had agreed that the two horses could be placed in a split paddock (which we take to mean a single paddock divided by a temporary electric fence, the horses being on either side of that fence). 4. The evidence concerning the incident came entirely from the only two eye witnesses, namely the Appellant and her employee, Ms Georgia Creais. Their evidence, in summary, was to the effect that Roxy went through the electric fence and ripped the tape (part of the electric fence) down, then went into a gallop and smashed into a gate rail. She fractured her shoulder and had to be euthanised by a veterinarian. 5. The Tribunal found that there was a "business arrangement in place" by which the Appellant provided agistment services for a fee of $20 per day per horse from 30 August 2018. The Tribunal found that the temporary electric fence used by the Appellant to split the paddock and separate the two horses failed to restrain Roxy. The Tribunal added: The Tribunal has some difficulty grasping how an electric fence advertised by the manufacturer and described in [49] and having apparently been correctly set up and tested by the Respondent and/or her staff member Ms Creais, would fail to turn away a horse and lead to that horse moving in the same direction through the electrified fence after having received a "memorable shock" [63]. 1. The Tribunal found that there was an "inferred contract" between the parties. The Tribunal stated that s 60 of the Australian Consumer Law provides a guarantee by a supplier as to due care and skill and that the Appellant as a supplier of agistment services to the Respondent by "way of an implied contract to provide agistment services was required to render that service with due care and skill".[67] 2. The Tribunal then went on to state: "Whether or not the parties agreed the horses would be placed in the same paddock separated by temporary electric tape fencing, the Respondent [Appellant] had an unquestionable duty to return Roxy to her owner in the same fit and healthy condition, or as close as possible to the state that she arrived in.[70] 1. The Tribunal found that the Appellant was liable for the value of Roxy as established on the "barely challenged evidence of the Applicant [Respondent] through the evidence of Ms Daniela Dierks' valuation"….. "the Respondent did not seek a separate independent valuation to place before the Tribunal. This is a noteworthy omission in the Respondent's case." [72]. 2. The Tribunal then stated at [73] that the Appellant "has not discharged her onus of proof of proving that she is not liable for the Applicant's loss of her dressage competition horse Roxy". The Tribunal stated that the Respondent had proved that the value of Roxy was $50,000 and made an order of $40,000 (that being the limit of the Tribunal's jurisdiction).

Notice of Appeal

The Appellant lodged a Notice of Appeal on 12 July 2020. The grounds of appeal may be summarised as follows: 1. The Tribunal erred in law in holding that the Appellant had an unquestionable duty to return the mare to the Respondent in the same fit and healthy condition, or as close as possible to the state that she arrived in. 2. The Tribunal erred in law in not holding that the Appellant's only duty was to render the agistment services with due care and skill. 3. The Tribunal erred in law in holding that the Appellant had an onus of proving that she is not liable for the Respondent's loss. 4. The Tribunal erred in law in finding that the value of the mare was $50,000, when there was no, or no sufficient, evidence in support of that finding. 5. The Tribunal erred in law in failing to take into consideration the Appellant's evidence as to the value of the mare. 6. The Tribunal erred in law by failing to take into consideration the Appellant's evidence as to her rendering the agistment services with due care and skill. 7. The Tribunal erred in law in not holding that the Appellant rendered the agistment services with due care and skill. 8. The Tribunal erred in law in taking into account its own opinion that an electric fence advertised by the manufacturer and described in [49] and having been correctly set up and tested by the Respondent and/or her staff member would turn away a horse and would not leave that horse moving in the same direction through the electrified fence after having received a "memorable shock".
In addition, the Notice of Appeal submitted that the Decision was not fair and equitable and was against the weight of evidence. We do not see a need to explain those grounds in greater detail.

Reply to Appeal

The Respondent has filed a Reply to Appeal. We will refer to the substance of the Respondent's Reply later in these reasons when we deal with the Respondent's submissions.

Appellant's Submissions

The Appellant's submissions may be summarised as follows: 1. The duty described in the Decision at [70], (ie an unquestionable duty to return the mare in the same fit and healthy condition, or as close as possible to the state that she arrived in) is not a duty known to the law and is not the duty imposed by s 60 of the ACL, That duty is only to render services with due care and skill. 2. The second error identified by the Appellant was that the Tribunal erred in law in holding that the Appellant had an onus of proving that she was not liable for the Respondent's loss (being the finding at [73] of the Decision). 3. In any event, there was no evidence that the Appellant did not exercise due care and skill. 4. The third error of law identified by the Appellant was that the Tribunal erred in law in finding that the value of the mare was $50,000, when there was no, or no sufficient, evidence in support of that finding. The Respondent's valuation was not given by a qualified expert or in the form of an expert report. Ms Dierks did not claim any qualifications or experience in valuing horses and she is not independent because she is, or was, the Respondent's dressage instructor. The Appellant also contends that the Tribunal failed to take into consideration the Appellant's evidence and in particular the evidence of J Twomey and Dianna De Silva. The Appellant's representative described this omission as giving rise to a question of law because the Tribunal's finding was based upon the valuation of Ms Dierks which the Appellant's representative described as "no real evidence". During the hearing of the appeal this submission was rephrased as a submission to the effect that the Tribunal had provided inadequate reasons for its preference for the valuation of Ms Dierks over the evidence provided by the Appellant concerning the mare's valuation.

Respondent's Submissions

The Respondent's submissions may be summarised as follows: 1. The agreement was oral and on previous occasions the Appellant had issued an invoice. She understood that she would be required to pay for the agistment services. 2. The Appellant failed to exercise due care and skill because she placed the two horses in the same paddock separated by a temporary electric fence, contrary to the understanding that she had with the Appellant. The specific failure to exercise due care and skill was that the Appellant did not place the two horses in separate paddocks and placed them in a split paddock without prior agreement. The temporary electric fence was not appropriate given its height and the size of the horses. 3. The Tribunal was correct to favour the valuation evidence of Ms Dierks. Ms DeSilva is a "hobbyist" and not a professional.

Appellant's Submissions in Reply

The Appellant's submissions in reply can be summarised as follows: 1. There was no evidence that the temporary electric fence was inadequate. 2. In the circumstances, the appeal should be allowed and the Respondent's application dismissed.

Consideration

This is an appeal from a Decision made in the Consumer & Commercial Division of the Tribunal. It is an appeal regulated by s 80 of the Civil & Administrative Tribunal Act (the NACT Act) and by cl 12 of Sch 4 of the NCAT Act. Essentially this means that an appeal lies as of right on a question of law and with leave on the grounds set out in cl 12. In view of our decision concerning the questions of law raised by the Appellant there is no need to refer to cl 12.
In our view, the Tribunal was correct in describing the Appellant's duty by reference to the obligations set out in s 60 of the ACL. As stated earlier, that section states that if a person supplies, in trade or commerce, services to a consumer, there is a guarantee that the services will be rendered with due care and skill. However, in our view, the Tribunal failed to make a finding that the Appellant provided the agistment services in a manner which involved a failure to provide the services with due care and skill. Rather, the Tribunal stated in [70] of the Decision that the Appellant had an "unquestionable duty to return Roxy to her owner in the same fit and healthy condition or as close as possible to the state that she arrived in". That is not an accurate description of the duty of the Appellant.
As stated above, we are of the view that the Tribunal has erred in law by describing the Appellant's conduct as involving an unquestionable duty to return Roxy in the same fit and healthy condition, or as close as possible to the state that she arrived in. The error is that that description of the duty suggests that the Appellant is liable even if the Appellant had provided services with due care and skill.
It seems to us that the Respondent was essentially arguing that the Appellant's decision to place the two horses in a paddock separated by a temporary electric fence constituted a failure to render services with due care and skill given the size of the horses, the height of the fence and the possible unfamiliarity of the horses with such a fence. However, the Tribunal did not make findings of fact enabling it to conclude that the Appellant had failed to provide the services with due care and skill. There was a dispute between the parties as to whether there had been a prior conversation by which the Appellant foreshadowed placing the two horses in a split paddock. Even if there had been agreement to that course on the part of the Respondent, that may not have led to the conclusion that the Appellant was free of an obligation to independently assess whether the use of such a fence in the circumstances was appropriate or that such use was necessarily consistent with the Appellant's obligation to provide the services with due care and skill.
The second error of law is that the Tribunal held at [73] that the Appellant had not discharged her onus of proving that she is not liable for the Respondent's loss. In cases of bailment for reward the onus of proof may be reversed: see Hobbs v Petersham Transport Co Pty Ltd (1971)124CLR220 at 233-4, which was followed in The Anderson Group Pty Ltd v Tynan Motors Pty Ltd [2006] NSWCA 22 at [126]. However, in this case the Respondent, as the consumer alleging breach of contract and the ACL, had the onus of proving that the Appellant was liable. The Tribunal erred in considering the position of the parties on the basis that the Appellant had the onus of proving that she was not liable.
Given our views on the two errors described above, it is not necessary to consider whether the Tribunal erred with respect to the valuation evidence.
Accordingly, the appeal must be upheld.
The Appellant's representative submitted that we should also order that the Respondent's application be dismissed. In our view, that would be inappropriate and unjust. What has occurred in this case is that the analysis of the respective rights and obligations of the parties has not been conducted by the Tribunal in accordance with the law. That means that the Respondent has not yet had a fair opportunity to have her case determined. The appropriate order is that there be a rehearing. Given that the parties were unrepresented and may not have had a sophisticated understanding of the evidence they each needed to put forward, it would also be in the interests of justice, in our view, that the parties have leave to put forward fresh evidence on the rehearing. Accordingly, the orders that we make are the following: 1. The appeal is allowed. 2. The order made by the Tribunal on 15 July 2020 in the proceedings under appeal is set aside. 3. The Respondent's application is remitted to the Consumer & Commercial Division of the Tribunal for a rehearing before a differently constituted Tribunal member and with liberty for the parties to file and serve fresh evidence.

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: 06 November 2020

Administrative Tribunal Act 2013(NSW)

At a glance

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Decision date

Source

Judgment (9 paragraphs)

Parties

Legislation Cited (2)

Cases Cited (2)