Ishak v Soldat Group of Companies Pty Ltd

NCAT Appeal Panel|2020-07-30

REASONS FOR DECISION

The appellant was a homeowner. She engaged Trinity Development & Construction (Aust) Pty Ltd ("Trinity") to do certain building Work on her home. She alleged that she also engaged the respondent (after she had engaged Trinity but before Trinity had completed its work) to supply and install an open/close outdoor roofing system, a number of internal motorised blinds and window shutters (collectively, the "Work") for a total price of $112,000.
The appellant alleged that the Work was never completed, parts of it were not properly installed and parts could not be operated as intended. We shall conglomerate those various complaints within the description "defective" for ease of expression in these reasons for decision.
After two group list hearings and a number of directions hearings, most of which were not attended by the respondent, the proceedings were set down for hearing. The respondent did not appear at the hearing. The Tribunal proceeded to hear the matter, considered the evidence provided by the appellant, found in favour of the appellant, and ordered the respondent to pay to the appellant the sum of $81,500.30 (the "Original Decision").
Approximately eight months later the respondent filed an application to set aside the Original Decision (the "Application").
The Tribunal below granted that application (the "Set Aside Decision") and set aside the Original Decision.
The appellant appeals from the Set Aside Decision but filed her Notice of Appeal late and requires an extension of time to lodge her Notice of Appeal.
On 14 April 2020 orders were made pursuant to s 50 of the Civil and Administrative Tribunal Act 2013 (NSW) ("NCAT Act") that the appeal should be decided on the papers and without an oral hearing.
For the reasons set out below we extend the time for the appellant to appeal, we uphold the appeal, we set aside the Set Aside Decision and in lieu thereof we order that the Application be dismissed.

Background

The relevant procedural and other background facts upon which we have relied in coming to our decision, in addition to those already stated, are set out below, together with occasional observations and findings by us where convenient to do so to aid the understanding of our reasons.
On 19 September 2018 the appellant commenced proceedings against Peter Soldat (the respondent's director) in relation to the alleged defective Work.
On 24 September 2019 the Tribunal posted a Notice of Conciliation and Hearing (Group List) to Mr Soldat at an address in Alexandria, NSW, notifying him that a conciliation and group list hearing would be held on 12 October 2018. That letter was returned to the Tribunal as undelivered.
At the group list hearing on 12 October 2018 the appellant appeared but the respondent did not. The name of the respondent was changed from that of Mr Soldat to the name of the present respondent (of which Mr Soldat is a director).
On that same date the Tribunal posted a Notice of Order dated 12 October 2018 to the respondent at the address in Alexandria to which the notice of 19 September 2018 had been sent. This Notice of Order notified the respondent that the hearing had been adjourned to a date to be fixed, and of the change in name of the respondent to the proceedings. This letter was not returned to the Tribunal.
On 19 October 2018 the Tribunal posted a Notice of Conciliation and Hearing (Group List) to the respondent at both the Alexandria address referred to above and an address in Mangrove Mountain, NSW. This latter address was the respondent's registered office address as recorded by ASIC in a Form 484 dated 15 October 2015 and signed by Mr Soldat. Neither letter was returned to the Tribunal.
This Notice of Conciliation and Hearing (Group List) notified the respondent that a conciliation and group list hearing would take place on 9 November 2018.
At the group list hearing held on 9 November 2018 the appellant appeared by her husband and a friend. Mr Soldat appeared on behalf of the respondent. Mr Soldat's evidence lodged in support of the Application is silent as to how he knew of the time and place of this group list hearing. The reasonable inference is that he gained that knowledge from the contents of one of the two Notices sent by the Tribunal on 19 October 2018, and thus at least one of the two Notices were received by the respondent.
As recorded in the reasons for the Original Decision, the respondent asserted at the group list hearing that Trinity undertook the Work, that it was Trinity which contracted with the appellant to do so and that the respondent had contracted with Trinity (and not the appellant).
We note that in his subsequent affidavit affirmed 31 December 2019 lodged in support of the Application, Mr Soldat said that he never said at that group list hearing that "it is Trinity who did the Work (sic)".
We further note that in written submissions dated 13 January 2020 lodged in support of the Application and signed by Mr Soldat, the respondent submitted that the appellant and respondent had "entered into a contract" for the manufacture and supply (including installation) of the Work for a price of $112,000 on 25 March 2013.
Thus, there is (at least now) no dispute between the parties that the appellant had contracted with the respondent to supply and install the Work.
A number of orders were made by the Tribunal on 9 November 2018, apparently in the presence of Mr Soldat. Those orders were: "1. By Determination of member, on 09 November 2018 the hearing was adjourned to a date to be fixed by the Registrar. 2. Trinity Developments and Construction (Aus) Pty Ltd is joined as a respondent. 3. The respondent Soldat shall provide to the applicant and the other respondent and the Tribunal, either in person or by post, a copy of any submission and evidence on the issue of the correct respondent by 07-Dec-2018. 4. The applicant and respondent Trinity shall provide to the respondent Soldat and each other and the Tribunal, either in person or by post, a copy of any submission and evidence in response to the above submission by 11-Jan-2019. 5. Any application for leave to be represented is to be made to the Tribunal on or before 11-Jan-2019 and will be considered at the next hearing. Leave will not be granted on the basis of work commitments. A separate written notice of the new hearing date will be sent to you in the near future."
Copies of those orders were posted to the respondent at both the Alexandria and Mangrove Mountain addresses. The orders sent to Alexandria were returned to the Tribunal as undelivered. The orders posted to Mangrove Mountain were not returned.
We note that Order 3 was mandatory and was not complied with by the respondent by the date stipulated or at all.
On 14 November 2018 the Tribunal posted copies of a Notice of Order dated 14 November 2018 to the respondent at both the Alexandria and Mangrove Mountain addresses. The Notice said: "On 19 September 2018 an application was lodged by Evet Ishak with the NSW Civil & Administrative Tribunal. Pursuant to Section 44 (1) of the NSW Civil & Administrative Tribunal Act 2013, the Tribunal has directed that Trinity Developments and Construction (Aus) Pty Ltd be joined as a party to proceedings. Attached is a copy of the application and procedural directions of 9 November 2018. Written confirmation of the new hearing date will be sent to you shortly."
The Notice posted to Alexandria was returned to the Tribunal as undelivered. The Notice posted to Mangrove Mountain was not returned.
Also on 14 November 2018, the Tribunal posted a Notice of Directions Hearing dated 14 November 2018 to the respondent at both the Alexandria and Mangrove Mountain addresses. The Notice posted to Alexandria was returned to the Tribunal as undelivered. The Notice posted to Mangrove Mountain was not returned.
This Notice of Directions Hearing notified the respondent that a directions hearing would be held on 21 January 2019.
At the directions hearing held on 21 January 2019 the appellant and Trinity appeared, but there was no appearance on behalf of the respondent.
In the respondent's written submissions dated 13 January 2020 and filed in support of the Application, the respondent said: "The (respondent) was unable to attend the proceedings of 21 January 2019."
The reasonable inference to draw from that submission, the absence of any evidence or submission that that Notice dated 14 November 2018 had not been received by the respondent, and the fact that that Notice (posted to the Mangrove Mountain address) was not returned to the Tribunal, is that the respondent was aware of that directions date, and had become aware of that date because the respondent received the Mangrove Mountain Notice dated 14 November 2018. Why the respondent was "unable to attend" has not been directly explained.
At the directions hearing held on 21 January 2019 the Tribunal made the following orders: "1. By Determination of member, on 21 January 2019 the hearing was adjourned to a date to be fixed by the Registrar. A separate written notice of the new hearing date will be sent to you in the near future."
A copy of those orders was posted to the respondent at the Mangrove Mountain address. Those orders were not returned to the Tribunal.
On 31 January 2019 the Tribunal posted to the respondent at the Mangrove Mountain address a Notice of Directions Hearing dated 31 January 2019. That Notice was not returned to the Tribunal. The Notice advised the respondent that a directions hearing would be held on 6 March 2019.
The directions hearing which took place on 6 March 2019 was conducted by the Tribunal Member who subsequently conducted the hearing of the proceedings on 24 April 2019.
On 6 March 2019 the Member "made findings" that the respondent had failed to provide any evidence relating to any contract or arrangement between it and Trinity as directed on 9 November 2018 (see [20] above), found that there was no contract between the respondent and Trinity, and removed Trinity as a party to the proceedings. How the factual finding that there was no contract between the respondent and Trinity could have been made at a directions hearing in the absence of the respondent or notice to the respondent that such an order was being contemplated is not clear, but that decision has not been challenged and, as it turns out, appears to be accepted as correct by the respondent.
The Member noted that notice of that directions hearing had been sent to the respondent and that that notice had not been returned to the Tribunal.
The Member made the following orders: "1. By determination of the member, on 06 March 2019 the hearing was adjourned to a date to be fixed by the Registrar. 2. The parties shall advise the Tribunal and each other by 4.00pm on 13-Mar-2019 of unavailable dates for hearing for a period of three (3) months commencing on 01-Apr-2019. 3. Soldat Group of Companies Pty Ltd t/as Luxuz Design shall send to Evet Ishak and the Tribunal a copy of all documents including expert reports, witness statements and any other documents, on which the respondent intends to rely at the hearing by 20-Mar-2019. 4. The Tribunal finds that Soldat Group of Companies Pty Ltd t/as Luxuz Design have failed to provide any evidence relating to any contract or arrangement between it and Trinity Developments and Construction (Aus) Pty Ltd, in compliance with directions made on 09-Nov-2018 and the Tribunal finds there was no contract between Trinity Developments and Construction (Aus) Pty Ltd and Soldat Group of Companies Pty Ltd t/as Luxuz Design, and Trinity Developments and Construction (Aus) Pty Ltd is not a party to these proceedings. · 5. Trinity Developments and Construction (Aus) Pty Ltd is removed as a respondent. 6. If evidence is not provided by a party in accordance with the orders above, that party will not be permitted to adduce that evidence in the hearing. 7. Any request for an extension of time to provide evidence or for and adjournment of the hearing will only be considered in exceptional circumstances and must be supported by a detailed affidavit with supporting evidence. 8. The parties are advised that the hearing will proceed in the absence of a party. A separate written notice of the new hearing date will be sent to you in the near future.
Also included in those orders was the following notation: Today Ms Ishak denied any agreement or contract between the Soldat Group and Trinity Developments and Construction (Aus) Pty Ltd, as does that company and Ms Ishak asserts she contracted with Soldat Group of Companies Pty Ltd t/as Luxuz Design for the supply and installation of the Work the subject of this application. It is appropriate therefore to remove Trinity Developments and Construction (Aus) Pty Ltd as a respondent.
A copy of those orders was posted to the respondent at the Mangrove Mountain address. Those orders were not returned to the Tribunal.
The respondent did not comply with any of those orders which applied to it by the dates stipulated or at all.
On 12 March 2019 the Tribunal posted to the respondent at the Mangrove Mountain address a Notice of Hearing which notified the respondent that the proceedings were listed for hearing on 24 April 2019. This Notice of Hearing was not returned to the Tribunal.
On 24 April 2019 the appellant appeared at the hearing of the proceedings, but there was no appearance by the respondent.
At the hearing the appellant led evidence on the matters in dispute between her and the respondent. The Tribunal said that the respondent had not co-operated with the proceedings, had not complied with directions to serve evidence, had not provided any comment or "disputes in relation to" the appellant's evidence, and had not appeared at the hearing on 24 April 2019. In those circumstances the Tribunal said that it was entitled to treat the appellant's evidence as unchallenged and undisputed by the respondent.
Included in the appellant's evidence were three documents on the respondent's letterhead. They each had the word "Proposal" printed at the top, each were addressed to the appellant, each had the words "Measuring 20 02 2013" (except for one which had "0213" which were infer was a typographical error in recording "2013"). One was for "Shutters", one for "Rolla Plus" and one for "Externals". These appear to refer to the shutters, motorised blinds and the open/close outdoor roofing system respectively (see [1] above), collectively being the Work.
The Externals and Rolla Plus Proposals stated that there was a "5 Year Unlimited Warranty", and the Shutters Proposal stated that there was a "10 Year Unlimited Warranty", although the terms and conditions of the warranties provided are nowhere to be found in the evidence.
The appellant alleged that she had an oral agreement with the respondent that the 10-year Warranty would apply to all items. The Tribunal below accepted this evidence and found that a term of their agreement was that the Work in their entirety were covered by a 10-year warranty provided by the respondent.
Also in the documentary evidence was a three-page tax invoice from the respondent addressed to Trinity and dated 25 June 2013. That document stated that $70,000 had been paid to date, with a remaining $42,000 being the balance due. The appellant denied that she or Trinity had requested the tax invoice, and reiterated that there was no agreement, arrangement or contract between Trinity and the respondent.
At the hearing the Tribunal first considered whether the appellant's claim was one under the Home Building Act 1989 (NSW) ("HBA").
The Tribunal decided that the Work fell within the definition of "residential building work" as defined in the Home Building Act 1989 (NSW), Schedule 1, clause 2.
We interpolate to observe that it appears that the respondent does not hold a contractor licence as required under the HBA, and that it is apparent, assuming the HBA applies, that there was no written contract in existence in relation to the Work in the form required by s 7 of the HBA.
The Tribunal then turned to the statutory warranties provided by s 18B of the HBA and found that the respondent had breached sub-ss (1)(a), (b), (d) and (e).
Section 18B(1)(a), (b), (d) and (e) say: 18B Warranties as to residential building work (1) The following warranties by the holder of a contractor licence, or a person required to hold a contractor licence before entering into a contract, are implied in every contract to do residential building work - (a) a warranty that the work will be done with due care and skill and in accordance with the plans and specifications set out in the contract, (b) a warranty that all materials supplied by the holder or person will be good and suitable for the purpose for which they are used and that, unless otherwise stated in the contract, those materials will be new, (c) … (d) a warranty that the work will be done with due diligence and within the time stipulated in the contract, or if no time is stipulated, within a reasonable time, (e) a warranty that, if the work consists of the construction of a dwelling, the making of alterations or additions to a dwelling or the repairing, renovation, decoration or protective treatment of a dwelling, the work will result, to the extent of the work conducted, in a dwelling that is reasonably fit for occupation as a dwelling,
The Tribunal then turned its mind to whether the appellant's proceedings were commenced within the time limits for HBA claims.
The Tribunal found that the allegations in relation to the open/close outdoor roofing system constituted a "major defect" as defined in the HBA and therefore the proceedings in relation to that item were within time.
The Tribunal found that the alleged defects in relation to the Rolla Plus and Shutters were not "major defects" under the HBA, and therefore a two-year time limitation applied. The Tribunal said it could not determine from the evidence when the two-year period had commenced to run, and so could not determine whether the appellant's claims in relation to those items were within time or not.
However, the Tribunal found that the defects with the Rolla Plus and Shutters were covered by the warranty provided and were within the time limitation of the warranty whether that warranty was for five or ten years.
The Tribunal found that the respondent had failed to complete the Work to a satisfactory and workmanlike standard or at all, and that it was appropriate to order that the Work be demolished, removed and replaced with new but equivalent work.
The Tribunal then determined that in the circumstances of the case, including the Tribunal's factual findings that the respondent had abandoned the Work and had either not been able to, or had refused to, rectify or complete the Work, that it was more appropriate to make a money order rather than order the respondent to rectify the defective Work.
The Tribunal assessed the cost to rectify the Work at $81,500.30 and ordered the respondent to pay that sum to the appellant within 28 days of the date of the orders, being 24 April 2019.
Written reasons for the Tribunal's decision were produced and were posted on or about 30 April 2019 to the Mangrove Mountain address, which is the same address as appears on the respondent's Reply filed in relation to this appeal, and, as we have noted earlier, is the respondent's registered office address. Those reasons were not returned to the Tribunal.
The appellant subsequently sought to enforce the order that the respondent pay her $81,500.30 by having issued out of the Local Court a Writ for the Levy of Property dated and filed 13 November 2019.
The Sheriff attended the respondent's premises on 19 November 2019, being the first step taken in enforcing the Writ.
Approximately six weeks later, on 31 December 2019, the respondent filed the Application.
In the Application the respondent: 1. indicated its desire to set aside the Original Decision; 2. said that the Original Decision was made in its absence which resulted in its case not being adequately put to the Tribunal; 3. said it had been absent because it had not been: "… served a notice or summons to appear and was unaware of the proceedings / date of proceedings scheduled for 24 April 2019."
In the Application the respondent said that the evidence and arguments the respondent would have put to the Tribunal if it had not been absent would have been that: "… not only (had it) performed to the terms and conditions of the contract but (it had) performed well in excess of the terms of the contract in delivery of goods and services at a heavily discounted market rate in an effort to appease the constant demands of (the appellant) during the course of construction, thereby dramatically increasing the costs of construction."
This position is different from that put to the Tribunal on 9 November 2018 (see [15] - [20] above), in that the Application did not assert that the respondent did not have a contractual relationship with the appellant. Rather, the respondent was essentially saying that it had not breached the terms of the contract it had had with the appellant.
In the Application the respondent also said that it required an extension of time to lodge the Application. The time to lodge an application to set aside or vary a Tribunal decision is within seven days after the decision concerned was made: reg 9(3) of the Civil and Administrative Tribunal Regulation 2013 (NSW) (the "NCAT Regulations"). The respondent's Application was lodged approximately eight months after the decision concerned was made and so was just under eight months out of time.
In the Application the respondent provided two reasons why an extension of time should be granted.
First, it said that it only became aware of the orders made per the Original Decision on 19 November 2019 (despite a copy of the Original Decision having been posted to the respondent's registered office address and that copy of the Original Decision not having been returned to the Tribunal as undelivered).
Second, the respondent said that Mr Soldat had been consumed in the preceding eight months by his business commitments, keeping the business afloat and also because of the intense energy and effort engaged in by him to help a personal friend and family member.
This is some disconformity between the two reasons given. If the respondent was truly unaware of the Original Decision what did it matter if Mr Soldat was busy with other matters?
Part of the Application form consisted of a statutory declaration. Mr Soldat completed that statutory declaration and in it he declared that neither he nor the respondent were served with a formal notice, summons or subpoena to attend the hearing of the proceedings on 24 April 2019, and that therefore he was consequently unaware of the "proceedings" until after the date of the orders. By "proceedings" we infer, from the context, that the respondent meant "hearing date".
Mr Soldat further declared that since the date of the orders his energies had been consumed in maintaining and running a profitable business while at the same time assisting his friend, and that his assistance to the friend commenced on 11 April 2019 and continued to the date of his statutory declaration. He then declared: "… so for this reason I have been unavailable to complete and file an application earlier and I seek leave to do so now."
It is relevant to note that in the statutory declaration Mr Soldat did not declare that the delay in filing the Application was because the respondent was unaware of the Original Decision (posted to the respondent's registered office address and not returned to the Tribunal).
Attached to the Application was an affidavit affirmed by Mr Soldat on 31 December 2019. In that affidavit Mr Soldat said that the Application was not filed in time as he was unaware of the hearing of 24 April 2019 until: "After the statutory period to lodge same."
In the following paragraph of his affidavit, being paragraph 13, he said: "No objection to, or document titled 'Application to set aside or vary Tribunal decision' was filed until 31 December 2019 by reason: a. I have been heavily consumed with and committed to running my business interests, and b. I have also been heavily consumed with assisting a personal friend and family member …"
As with the statutory declaration, the affidavit does not say that the delay in filing the Application was because the respondent was unaware of the Original Decision.
In relation to the Set Aside Decision the Tribunal made directions on 3 January 2020. The parties were directed to provide written submissions by certain dates, and the Tribunal directed that: "Submissions must address whether: (1) leave should be granted to extend the time to make the set aside application; (2) other: Notices of Hearing was (sic) sent to Soldat Group of Companies Pty Ltd at the registered address for service on 19/10/2018, 14/11/2018 & 31/1/2019 which is the address provided by the corporation in set aside application (sic). The notices of hearing were not returned to the Tribunal.
The respondent provided written submissions dated 13 January 2020.
In those submissions the respondent addressed note 1 as quoted at [77] above but did not address note 2 other than to say that it was "unable to attend the proceedings of 21 January 2019" which was the date given in the notice from the Tribunal dated 14 November 2018, being one of the three notices referred to in note 2.
As for note 1 and submissions as to why time should be extended to lodge the Application, the respondent submitted that its time was "tied up" with attending to its business, and time and energy was expended by Mr Soldat in attempting to secure the freedom of a family friend who was allegedly institutionalised against his will. It was submitted that that matter remained unresolved as at the date of the submissions. It was further submitted that a combination of those two matters simply: "… usurped most of (Mr Soldat's) time to the point (where the respondent) lost track of the state and disposition of the NCAT legal proceedings …"
As we have said at [29] above, we infer that the respondent received the Notice dated 14 November 2018. We also infer that the respondent received the Notice dated 19 October 2018 because Mr Soldat appeared at the Tribunal on the date specified in that Notice.
The third notice referred to in note 2 quoted at [77] above was that dated 31 January 2019. That Notice advised the respondent of the directions hearing on 6 March 2019. In its written submissions dated 13 January 2020 the respondent said in relation to that Notice: "The (respondent) was unaware of the outcome of the proceedings dated 06 March 2019 and consequently was unaware of the Orders for an adjournment for 24 April 2019."
That submission does not amount to a denial of receipt of the Notice dated 31 January 2019 which advised the respondent of the directions hearing of 6 March 2019. Rather, it simply asserts that the respondent was unaware of the outcome of that directions hearing (despite a copy of the orders made on 6 March 2019 being posted to the respondent's registered office address at Mangrove Mountain and those orders not being returned to the Tribunal). We infer that the Notice dated 31 January 2019 was, in fact, received by the respondent.
Even if the orders dated 6 March 2019 were not received by the respondent, a proposition which we do not accept for reasons later set out, there is no explanation for why the respondent did not contact the Tribunal to find out what had transpired on 6 March 2019.
Section 36(3) of the NCAT Act makes it mandatory for parties to the proceedings to co-operate with the Tribunal to give effect to the guiding principle (being to facilitate the just, quick and cheap resolution of the real issues in the proceedings) and, for that purpose, to participate in the processes of the Tribunal and to comply with directions and orders of the Tribunal.
In the circumstances of this case, even assuming the respondent did not receive the Notice dated 6 March 2019, we are of the opinion the respondent, knowing that that date was for a directions hearing, was required by s 36(3) to contact the Tribunal to find out what directions had been made. A failure to make that enquiry was a failure to co-operate with the Tribunal to facilitate the just, quick and cheap resolution of the real issues in the proceedings and to participate (as a matter of substance) in the processes of the Tribunal.
The respondent's submissions went on to assert that the respondent had not had the opportunity to present its defence and evidence. In the Application form the respondent denied there was any breach of the terms of the contract (which amounted to a denial of any breach of the warranty provided by s 18 of the HBA and a denial of any breach of the five or ten year warranties).
Annexed to Mr Soldat's affidavit affirmed on 31 December 2019 was a statement by Mr Soldat dated 31 December 2019. In that statement Mr Soldat sets out some evidence, albeit quite thin evidence, which would be relevant to a defence that the Work was not defective. There is much other evidence in the statement which is not relevant to any defence.
The evidence which is relevant to a defence that the Work was not defective does not address the particular evidence which had been provided by the appellant and which the Tribunal accepted. For example, there was evidence before the Tribunal that various shutters had broken down, three louvre blades had not been installed, two blades were faulty, guttering had not been installed, a rain sensor had not been installed, the outdoor roofing system was out of level and the outdoor roofing system was not functional. There was evidence before the Tribunal that a full replacement of the outdoor roofing system was warranted because of the number of issues with it. None of those matters were directly addressed by the respondent either by way of submission or evidence.
There was no evidence in this statement as to the shutters breaking down (other than that they had been working when first installed), nothing about the three missing louvre blades, the two faulty louvre blades, the outdoor roofing system being out of level nor that the outdoor roofing system was not functional (other than that it had been working when first installed).
There was a little evidence to the effect that the respondent had Trinity agree that guttering for the outdoor roofing system would be installed by Trinity's sub-contracting plumber, it was installed but was installed incorrectly in that it was installed in the incorrect place.
The statement also included evidence that the appellant had paid the whole of the contracted price other than $2,000. The respondent submitted that it was Trinity's obligation to check and ensure all products installed by the respondent were installed properly "or progress payments would NOT be made". This appears to be a submission that because progress payments were made the appellant can be taken to have admitted that the Work was not defective.
Having received the parties' submissions, the Tribunal determined the Application without an oral hearing (as it was entitled to do). Written reasons dated 24 January 2020 were given.
The totality of the Tribunal's reasons for the Set Aside Decision were: "1. The application to set aside the decision in matter number HB 18/40815 has been considered and the following orders are made: The time to make the application to set aside is extended to 31/12/2019. Reasons: 1) The (respondent) contends he has not been served with the notice of hearing. 2) The (respondent) contends that he is not the builder responsible for the defective work. His contract was to supply the goods. 2. Orders made on 24/4/2019 in matter number HB 18/40815 are set aside."
The appellant lodged a Notice of Appeal from the Set Aside Decision on 27 March 2020. It should have been lodged by 24 February 2020, and so the appellant requires an extension of time of a little under five weeks.

Extension of Time

The relevant principles to apply to an application by a party to extend time for the lodgement of a Notice of Appeal were set out in Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22 at [18]-[22].
The delay is not significant, being of about one month.
The reasons for the delay are not overly strong. The appellant said she is a busy dental practitioner who runs her own busy medical centre and was very busy between the end of January and February 2020 in attending to patients, and then she travelled overseas on a pre-booked family holiday between 17 February and early March 2020. Whilst the appellant was undoubtedly busy, so are many citizens. The Tribunal is not a convenience but a publicly funded institution whose guiding principle is to facilitate the just, quick and cheap resolution of the real issues in dispute between the parties.
The appellant's prospects of success are good (as will appear later below).
There is no demonstrated prejudice to the respondent.
On balance, although the reasons for the delay are not strong, the other matters we are required to take into consideration persuade us that time to lodge the Notice of Appeal should be extended up to and including the day it was actually lodged, namely 27 March 2020.

Grounds of Appeal

The appellant raises two grounds of appeal: 1. inadequate reasons; and 2. a failure to take into account a relevant consideration.
The reasons are plainly inadequate (see generally Pollard v RRR Corporation Pty Ltd [2009] NSWCA 110 at [56]-[67]).
Whilst the Tribunal is not obliged to spell out every detail of the process of reasoning to a finding it is essential to expose the reasons for resolving a point critical to the contest between the parties. These reasons fail that test.
The reasons must do justice to the issues posed by the parties' cases. Discharge of this obligation is necessary to enable the parties to identify the basis of the Tribunal's decision and the extent to which their arguments had been understood and accepted. It is necessary that the Tribunal enter into the issues canvassed and explain why one case is preferred over another. These reasons fail that test.
The Tribunal should refer to evidence which is important or critical to the proper determination of the matter as the first of the three fundamental elements of a statement of reasons. While it is unnecessary to refer to the relevant evidence in detail, especially in circumstances where it is clear that the evidence has been considered, where such evidence is not referred to by the Tribunal, an Appeal Panel may infer that the Tribunal overlooked the evidence or failed to give consideration to it. In this case critical evidence relating to the receipt of various Notices and the Original Decision were not referred to by the Tribunal (we have set that evidence out earlier in these reasons), and we infer that it was overlooked. Thus, the Tribunal below failed to take into account relevant evidence.
It is also the case that the Tribunal erred in failing to make appropriate findings. All the Tribunal below did, in terms, was to record two contentions of the respondent: that it had not received notice of the hearing, and; that it was not the builder responsible for the defective work.
As for the second reason, it appears to be incorrect. A proper reading of the material before the Tribunal reveals that the respondent did admit it did the Work and thus would be responsible for any defects. The defence was simply that the Work was not defective.
For those reasons we are of the opinion that the appeal must be upheld and the Set Aside decision should itself be set aside.

A New Hearing

The next question is whether we should order a new hearing or whether we should decide the Application (to set aside the Original Decision) ourselves as we are entitled to do pursuant to s 80(3)(a) of the NCAT Act - see Ros v Commissioner of Police [2020] NSWCATAP 70 at [29].
Section 80(3) of the NCAT Act says: (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.
In Pollard at [67], McColl JA, with whom Ipp JA and Bryson AJA agreed, said: "Where an appellate court concludes that the primary judge has failed to give adequate reasons, it has a discretion as to whether a new trial should be ordered. … In some cases of inadequate reasons, where there is no credit issue, the appeal court may be in as good a position to decide the matter as the trial judge …"
In our opinion we are in as good a position as the Tribunal to decide the Application. Given the procedural history of these proceedings that we have set out above, it is our opinion that it is preferable for us to decide the Application (by way of a new hearing on the evidence led below by the parties and which was before the Tribunal) in order to facilitate the just, quick and cheap resolution of the real issues in the proceedings, rather than remitting the Application to the Consumer and Commercial Division for hearing.

An Extension of Time

As earlier mentioned, the time within which an application to set aside a decision of the Tribunal pursuant to reg 9 of the NCAT Regulations must be filed is seven days. The respondent's application was filed approximately eight months after the Tribunal's Original Decision and six weeks after the Sheriff attended the respondent's premises seeking to enforce the Writ.
Therefore, the respondent requires an extension of time of a little under eight months under s 41 of the NCAT Act in relation to the Application.
In our opinion the respondent's explanation for the delay i.e. that it was unaware of the Original Decision until 19 November 2019, lacks reliability for the following reasons.
First, we have recited the history of the various notices sent by the Tribunal to the respondent. Of the nine notices of various kinds posted by the Tribunal to the respondent at its registered business address none were returned to the Tribunal. In comparison, of the six notices sent to the Alexandria address (not being the respondent's registered office address), four were returned to the Tribunal.
Second, the only two notices the respondent expressly says were not received were the notice dated 12 March 2019 (notifying the respondent of the hearing date of 24 April 2019) and the Original Decision.
Therefore, it is reasonable to infer from the matters set out at [117]-[118] above that the other seven notices sent by the Tribunal to the respondent's registered office address were received by the respondent.
Third, that inference is supported by the fact the respondent appeared at the conciliation on 9 November 2018, which date was advised in the Notice dated 19 October 2018 (which we inferred, earlier in these reasons, had been received).
Fourth, that inference is supported by the fact that, in relation to the directions hearing of 21 January 2019 (notified in the Notice dated 14 November 2018 which we inferred, earlier in these reasons, had been received), the respondent said that it was "unable to attend" on that date.
Fifth, in relation to the notice dated 31 January 2019 which advised that a directions hearing would be held on 6 March 2019, the respondent's written submissions said that it was unaware of the outcome of that directions hearing. This reference to "outcome" rather than "date" implies that the respondent was aware of that date.
Therefore, in our opinion and on the balance of probabilities, the respondent received all nine notices sent by the Tribunal to its registered office.
Again, on the balance of probabilities, the respondent simply refused to engage with the processes of the Tribunal, failed to comply with its duty under s 36 of the NCAT Act and failed to engage with the opportunities presented to it to be heard and to have its submissions considered.
This finding is supported by the fact that order 3 made in the presence of the respondent on 9 November 2019 (see [20] above) was not complied with.
It is supported by the fact that, despite being aware of the directions hearing of 6 March 2019, and despite acknowledging that it was unaware of the outcome of that directions hearing, the respondent took no steps to ascertain what occurred at that directions hearing.
The respondent's explanation in the Application itself that it only became aware of the orders made per the Original Decision on 19 November 2019 sits uneasily with the further explanation that Mr Soldat had been consumed in the preceding eight months by his business commitments, keeping the business afloat and also because of the intense energy and effort engaged in by him to help a personal friend and family member. If the respondent was unaware of the Original Decision, what did it matter if Mr Soldat was busy with other matters?
In any event, the first reason (that the respondent was unaware of the Original Decision) does not appear in Mr Soldat's statutory declaration nor his affidavit attached to the Application, albeit it does appear in Mr Soldat's unverified statement dated 31 December 2019. However, where it does so, a different date is given for when the respondent became aware of the Original Decision, namely 13 November 2019 rather than 19 November.
What happened after that date is relevant. That is, no application to set aside was lodged until 31 December 2019. The explanation for not doing so was Mr Soldat's attention to his business and the affairs of his friend.
We are not persuaded that those reasons justify the delay, either after the Sheriff attended or for the period between the date of the Original Decision and the date the Sheriff attended.
First, other than asserting that he was consumed by business affairs, Mr Soldat provides little detail as to why those business affairs were so consuming that there was no time left over to prepare and file the Application.
The respondent tendered three invoices for work done for three customers purportedly as evidence of busy work commitments. They are dated 7 October 2018, 8 March 2019 and 26 December 2019. No evidence is provided as to the nature and extent of the work referred to in those invoices, and we are not persuaded that they prove that Mr Soldat's business affairs were so consuming there was no time left to attend to the matter in the Tribunal over a period of approximately eight months.
In relation to Mr Soldat's friend, there is evidence that the friend was subject to a financial management order and guardianship order, and had been committed to an aged care facility. However, no evidence is provided setting out what Mr Soldat's involvement was in relation to those matters, how much time was taken up, when was it taken up nor what he was doing at any of those times.
Therefore, in our opinion, the evidence does not persuade us that Mr Soldat's business and personal affairs were so time consuming that there was no time left to attend to the proceedings in the Tribunal. In substance, all that is left is a mere assertion that that was the case, rather than that case being proved.
Even had the respondent proved that Mr Soldat's time had been consumed by those two matters, we would not be persuaded that Mr Soldat's preference for attending to the respondent's business affairs over such a long period would be an adequate excuse for not attending to the proceedings in the Tribunal.
We appreciate that Mr Soldat has not been cross-examined on those matters, however that is no bar in a case such as the present to refusing to extend time. To explain why that is so we now need to refer to Pham v Gall [2020] NSWCA 116, an authority which is also relevant to whether, assuming an extension of time to lodge the Application was granted, the Application would have been granted.

Pham v Gall

Pham was an appeal from a decision refusing an application to set aside a judgment made in the absence of the applicant some three years earlier. The explanation for the delay was the applicant's drug addiction. The Court of Appeal discussed and applied Vacuum Oil Pty Co Ltd v Stockdale (1942) 42 SR (NSW) 239, being the principal authority in this area, as it is in relation to applications made pursuant to reg 9 of the NCAT Regulations (see Hammond v Ozzy's Cheapest Cars Pty Ltd t/as Ozzy Car Sales [2015] NSWCATAP 65 at [76]).
In Pham, Payne JA delivered the principal judgment, with Leeming JA adding some remarks on a number of issues including the meaning to be given to Jordan CJ's words in Vacuum Oil that "there is a real likelihood that it would be unjust to the defendant to allow the judgment to stand".
McCallum JA agreed with both Leeming JA's additional remarks (at [159]) and Payne JA's reasons (at [156]). Leeming JA agreed with Payne JA's reasons (at [1]) and Payne JA agreed with Leeming JA's additional remarks (at [110]).
The following applicable considerations may be extracted from Pham: 1. As a general rule, a defendant who seeks to set aside a judgment by default regularly obtained must show that he or she has a bona fide defence. This ordinarily requires the defendant to file an affidavit demonstrating a prima facie defence on the merits. (Pham at [110]) 2. In order to succeed in setting aside a regularly obtained judgment, the party in default needs to explain the reason for the default and the nature of the proposed defence. Those matters inform the exercise of the discretion. (Pham at [56]) 3. An applicant seeking to set aside a judgment obtained after an undefended hearing does not have to show that a different result is likely should the judgment be set aside and a new trial ordered. However, the circumstances may be such as to require 'a reasonably clear case of merits to be shown'; that is, that it appear reasonably clearly that there is a defence capable of producing a different result. If that defence depends on facts, then there should be some evidence of those facts; and the circumstances may be relevant to the quality of the evidence that is required to show a defence on the merits in particular cases. Among such circumstances could be the degree of the applicant's default, and hardship to the respondent. (Pham at [97]) 4. The more egregious the delay in seeking to set aside an undefended judgment, the greater the burden of persuasion that will be required of the applicant. (Pham at [98], [109], [112]) 5. The lack of any satisfactory explanation for an egregious delay in seeking to set aside regularly obtained orders is a significant matter in the disposition of an application to set aside those orders. (Pham at [144]) 6. A bare assertion (as opposed to persuasive evidence) that a particular set of circumstances was the reason for an applicant's participation in a hearing may amount to a manifestly inadequate explanation. (Pham at [153]) 7. A mere possibility of "a real likelihood" of injustice if the regularly obtained judgment is not set aside is not a sufficient basis (of itself) to set aside the judgment. (Pham at [108]) 8. In relation to the evidence of an applicant: 1. The absence of cross-examination does not mean that a finder of fact is not entitled to be sceptical about the applicant's evidence. (Pham at [135]) 2. Assertions of a general character may not be persuasive as to the reasons why an applicant was impeded from defending a claim. (Pham at [145]-[146]) 3. Evidence not cross-examined upon may nevertheless be assessed to be internally inconsistent or lack reliability. (Pham at [146]) 1. Finality in litigation is a relevant matter to take into account in exercising the discretion. (Pham at [151]) 2. Where respondents are individuals funding their own case and are not commercially sophisticated parties, delay, and particularly where the delay is lengthy, gives rise to prejudice to respondents, taking into account that the orders were obtained in a regular way and the respondent had been unable to vindicate his, her or its rights since that date. (Pham at [140])

Decision on the Extension of Time

In our opinion the respondent should not be granted an extension of time for filing his Application for the following reasons.
First, we regard the respondent's evidence that it was unaware of the Original decision as unreliable and unconvincing. Nine notices were sent by the Tribunal to the respondent's registered office address, including the Original decision, and none were returned.
Second, the giving of the explanation that Mr Soldat was consumed by other matters from April 2019 until the date the Sheriff attended sits uncomfortably with the explanation that the respondent was unaware of the Original Decision and raises doubts in our minds as to the reliability of the excuse of lack of knowledge.
Third, the excuse of lack of knowledge was not contained in the two verified versions of events given by Mr Soldat: the statutory declaration and his affidavit.
Fourth, the respondent, on our findings, had probably received all other notices from the Tribunal, and had simply not attended the final two directions hearings and the final hearing as a result of a choice it had made.
Fifth, the respondent was aware of the directions hearing of 6 March 2019 and made no subsequent inquiry as to what directions were made on that date.
Sixth, the reasons given for non-participation in the hearing, and the delay between that date and the date on which the Application was filed, are unpersuasive, consisting of little more than a bare assertion of being consumed by other matters (which we would doubt would be a sufficient excuse even if proved).
Seventh, the delay was egregious.
In our opinion, per Pham at [144], those circumstances amount to a lack of a satisfactory explanation for an egregious delay in seeking to set aside regularly obtained orders, and that is a significant matter in the disposition of the Application.
Per Pham at [97], the circumstances we have mentioned above are such that, in our opinion, the respondent is required to demonstrate a reasonably clear case of merits. That is, that it demonstrate reasonably clearly that there is a defence capable of producing a different result and, to the extent the defence is reliant upon facts, that there should be some persuasive evidence of those facts.
In our opinion the respondent has not demonstrated a sufficiently clear defence (see [88]-[92] above) given the degree of the respondent's default and the hardship to the appellant.
Such evidence as there is which is relevant to a defence gives rise to the mere possibility of a defence, but that is not a sufficient basis (of itself) to set aside the judgment per Pham at [108].
The appellant is, so far as we are aware, funding her own case. She is not commercially sophisticated, the delay is lengthy, and there is prejudice to her per Pham at [140].
Finally, finality in litigation is a relevant matter to take into account in exercising the discretion per Pham at [151].
In all of those circumstances we are not persuaded that we should exercise our discretion and extend time for the respondent to lodge its Application.
Against the event that we are in error in declining to extend time, we shall briefly state our reasons why we would have decided, had time been extended, not to grant the Application.

The Application to Set Aside Reheard

The principles to apply when a party seeks to set aside a decision of the Tribunal pursuant to reg 9 of the NCAT Regulations are set out in in Hammond at [64]-[65].
In Hammond the Appeal Panel said: "[64] Accordingly, before the Tribunal's power to set aside a decision that determines proceedings arises, the Tribunal must be satisfied that: (1) The decision was made in the absence of a party; and (2) That absence resulted in the party's case not being adequately put to the Tribunal. [65] If those two requirements are satisfied, the Tribunal then has a discretion to set aside or vary the decision."
Therefore, the party seeking to set aside a decision must first persuade the Tribunal of three things (Hammond at [72]-[73]), namely: 1. the decision was made in the absence of a party; 2. that party's case was not adequately put to the Tribunal; and 3. the fact that the party's case was not adequately put to the Tribunal was the result of the party's absence.
If a party persuades a Tribunal of those three matters, it must then persuade the Tribunal to exercise its discretion to set aside the decision (Hammond at [64]-[65]). How that discretion is to be exercised and the sorts of matters to take into consideration in deciding whether to exercise the discretion was also set out in Hammond at [75]-[81] as follows (citations omitted): "[75] The discretion conferred by cl 9(1)(b) is unfettered by any express requirements of that clause but it must be exercised having regard to the statutory context in which the Tribunal operates. In particular, when applying cl 9(1)(b), the Tribunal must seek to give effect to the guiding principle referred to in s 36(1) of the Act ... Section 36 provides in part: 36 Guiding principle to be applied to practice and procedure (1) The guiding principle for this Act and the procedural rules, in their application to proceedings in the Tribunal, is to facilitate the just, quick and cheap resolution of the real issues in the proceedings. (2) The Tribunal must seek to give effect to the guiding principle when it: (a) exercises any power given to it by this Act or the procedural rules, or (b) interprets any provision of this Act or the procedural rules. [76] The central question in exercising the discretion is whether there is a real likelihood that it would be unjust to let the decision sought to be set aside stand. If so, it should be set aside on such terms as will minimise the possibility of injustice to the party which had obtained the original decision in its favour. … [77] Justice generally requires that parties against whom orders are made must be given a reasonable opportunity of appearing and presenting their case ... In the Tribunal, s 38(5)(c) of the Act provides: (5) The Tribunal is to take such measures as are reasonably practicable: … (c) to ensure that the parties have a reasonable opportunity to be heard or otherwise have their submissions considered in the proceedings. [78] If a party has been given such an opportunity, however, and has deliberately not taken it, there may well be no relevant injustice if the decision is allowed to stand … In this regard, the issue of why the party was absent from the hearing may be very significant ... [79] Injustice will only be likely to result if the party seeking to set aside the decision has an arguable defence or an arguable case that a different decision could have been reached. If not, setting aside the decision would be futile. … Section 38(4) of the Act is consistent with this approach, in that it requires the Tribunal to act according to the substantial merits of the case without regard to technicalities or legal forms. [80] In summary, when exercising the discretion conferred by cl 9(1)(b), the Tribunal should direct its attention to whether there would be a real likelihood of injustice if the decision was allowed to stand. Relevant considerations will generally include: (1) Why the party was absent and whether the absent party had a reasonable opportunity to be heard or otherwise have its submissions considered in the proceedings; and (2) Whether the absent party has an arguable defence or an arguable case that a different decision could have been reached. [81] Setting aside a decision will naturally involve a degree of prejudice to the party which was initially successful. As part of the exercise of the discretion, the Tribunal should also consider how that prejudice can be cured or reduced, for example by the framing of any set aside order or by the imposition of suitable conditions on that order. Conditional orders can be made in the Tribunal under s 58 of the Act."
There is no doubt that the Original Decision was made in the absence of the respondent.
We are satisfied that the respondent's case was not adequately put to the Tribunal because the matters contained in the statement of Mr Soldat dated 31 December 2019 (which are relevant to the defence of whether the Work was defective) were not put before the Tribunal. That evidence is thin, as we have mentioned earlier, but nevertheless it was some evidence of a defence and it was not put to the Tribunal.
The next question is whether the fact that the respondent's case was not adequately put to the Tribunal was because of the respondent's absence. The answer to that question must be "yes" as had Mr Soldat appeared before the Tribunal he would have given the evidence that is set out in his statement dated 31 December 2019.
Therefore, we are satisfied that the terms of reg 9 have been met.
The next question is whether we should exercise our discretion to set aside the Original Decision.
We would decline to do so for the same reasons we have declined to extend time to make the Application. In our opinion, the respondent was given sufficient opportunity to be heard and to have its submissions considered in the proceedings and has deliberately not taken it. Therefore, in our opinion, there is no relevant injustice in allowing the Original Decision to stand.

Orders

We make the following orders: 1. Time to lodge the Notice of Appeal is extended up to and including 27 March 2020. 2. Appeal upheld. 3. The decision of the Tribunal below is set aside. 4. In lieu thereof, the respondent's Application to set aside or vary Tribunal decision filed on 31 December 2019 is 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: 30 July 2020

Civil and Administrative Tribunal Regulation 2013(NSW)

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