King v Granny Flat Solutions Pty Limited

(1) Order 1 - the respondent (Granny Flat Solutions Pty Limited) to pay the appellants (Mr King and Mrs King) the sum of $332.50;

(2) Order 2 - the application otherwise dismissed.

1. The Decision was made pursuant to the Tribunal's jurisdiction to determine building claims under s 48K of the Home Building Act 1989 (NSW).
2. Both the appellants and Mr Antoun on behalf of the respondent attended the hearing of the Appeal.
3. The appellants appeal from that part of the Decision which dismissed the balance of their application.
4. The appellants confirmed at the hearing of the Appeal that they made the following claims before the Tribunal which were the subject of the dismissal order, being Order 2:

(1) A work order that the respondents move the spoil from the excavation site to behind the retaining wall at the respondent's cost;

(2) The respondent refund to the appellants the provisional sum cost of $4000;

(3) The respondent pay the appellants compensation for loss of rent of the granny flat at the rate of $480 per week from 30 August 2024 to the present;

(4) The respondent refund to the appellants the provisional sum cost of $1500 charged for additional trenching and digging costs.

1. Mr Antoun confirmed that his understanding was that these claims were the subject of the dismissal order of the Tribunal and were the subject of the Appeal.
2. The appellants confirmed that they were not appealing Order 1 which was for the respondent to pay the appellants $332.50.

1. Mr King conceded at the beginning of the appeal hearing that he was in effect relitigating his case because he says there were many problems with the case.
2. An appeal to the Tribunal's Appeal Panel does not provide the unsuccessful party in the Tribunal below with the opportunity to run its case again, nor is it sufficient for an appellant to disagree with the outcome and to contend there should have been a different outcome: Ryan v BKB Motor Vehicle Repairs Pty Ltd [2017] NSWCATAP 39 at [10]; Brahmbhatt v Osorio [2023] NSWCATAP 188 at [27]- [28].
3. To succeed in an appeal, an appellant must demonstrate either an error by the Tribunal on a question of law, which may be argued as of right; or that leave (permission) should be granted to bring the appeal for any of the three reasons set out in Clause 12(1) of Schedule 4 of the NCAT Act (which is expanded on below).
4. In Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69 the Appeal Panel set out at [13] a non-exclusive list of questions 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 had been applied;

(4) Whether there was a failure to afford procedural fairness;

(5) Whether the Tribunal failed to take into account relevant (i.e., mandatory) considerations;

(6) Whether the Tribunal took into account an irrelevant consideration;

(7) Whether there was no evidence to support a finding of fact; and

(8) Whether the decision is so unreasonable that no reasonable decision-maker would make it.

1. The Appeal Panel in Unique Commercial Group Pty Ltd v Cusumano [2024] NSWCATAP 204 at [25] provided further guidance in relation to what is a question of law. In summary:

(1) A question of law should be articulated with precision;

(2) Absent leave to appeal, the question of law is the subject of the appeal;

(3) A question of law means a "pure question of law" which is not dependent on facts not found and is not dependent on the answer to the question;

(4) A party contending that a question of law was wrongly decided must identify the question in abstract terms;

(5) A mixed question of fact and law is not a question of law, and a question of law must not be hypothetical or arid;

(6) A question of law must be capable of affecting orders the subject of the appeal, not purely the reasons; and

(7) There may be disclosed an error of law but this of itself does not necessarily raise a question of law.

1. Where the grounds of appeal do not raise a pure question of law, an appellant may seek leave to appeal.
2. The circumstances in which the Appeal Panel may grant leave to appeal from decisions made in the Consumer and Commercial Division of this Tribunal under s 80(2)(b) of the NCAT Act are limited to those set out in Cl 12 (1) of Sch 4 of the NCAT Act. In such cases, the Appeal Panel must be satisfied that the appellant may have suffered a substantial miscarriage of justice on one or more of the following bases:

(1) the decision of the Tribunal under appeal was not fair and equitable - cl 12(1)(a);

(2) the decision of the Tribunal under appeal was against the weight of evidence - cl 12(1)(b);

(3) significant new evidence has arisen being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with - cl 12(1)(c).

1. The principles governing an application for leave to appeal under the NCAT Act are well-established and are repeated in many decisions of the Appeal Panel, often quoting Collins v Urban [2014] NSWCATAP 17. As explained in Collins v Urban at [84], it is not sufficient merely to show that the Tribunal below was arguably wrong or that there is a bona fide challenge to an issue of fact.
2. In Collins v Urban [2014] NSWCATAP 17 (Collins v Urban), the Appeal Panel stated at [76] that a substantial miscarriage of justice for the purposes of cl 12(1) of Sch 4 may have been suffered where:

... there was a "significant possibility" or a "chance which was fairly open" that a different and more favourable result would have been achieved for the appellant had the relevant circumstance in para (a) or (b) not occurred or if the fresh evidence under para (c) had been before the Tribunal at first instance.

1. Even if an appellant from a decision of the Consumer and Commercial Division has satisfied the requirements of cl 12(1) of Sch 4, the Appeal Panel must still consider whether it should exercise its discretion to grant leave to appeal under s 80(2)(b).
2. In Collins v Urban, the Appeal Panel stated at [84] that ordinarily it is appropriate to grant leave to appeal only in matters that involve:

(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.

1. At a callover on 15 January 2025 directions were made for the parties to prepare the Appeal for hearing. In accordance with those directions both parties filed and served documents and submissions.
2. We have had regard to the following documents and the oral submissions of the parties:
   • The appellants' Notice of Appeal lodged on 9 December 2024
   • The appellants' documents lodged on 30 December 2024
   • The appellants' documents lodged on 13 February 2025
   • The appellants' documents lodged on 20 March 2025
   • The respondent's Reply to Notice of Appeal lodged on 2 January 2025
   • The respondent's submissions lodged on 4 March 2025
   • The Tribunal's reasons for decision dated 28 November 2024
   • The procedural directions made at callover
   • The application to the Tribunal 2024/256305l
3. Neither party has provided a transcript of the whole or any part of the hearing which took place on 31 October 2024.

1. The Notice of Appeal was filed with the Appeals Registry on 9 December 2024, which was within the 28 day time period specified in cl 25(4)(c) of the Civil and Administrative Tribunal Rules 2014 (NSW) (the Rules). Accordingly, the appeal was filed within time.
2. We understand from the Notice of Appeal and the submissions made at the hearing that the appellants appeal Order 2 of the Decision on the following grounds.

(1) The Tribunal erred on a question of law by failing to find that the respondent owed the appellants a duty of care to ensure there was no economic loss as per the Design and Builders Procedures Act 2024 (NSW).

(2) The Decision was not fair and equitable for the reasons set out in section 6Bi of the Notice of Appeal which we summarise as:

(a) The Tribunal member failed to uphold Clause 10 of the contract which required the respondent to give the appellants an opportunity to attend when the work the subject of the provisional sums was being done in order for the appellants to be able to verify the cost of that work;

(b) The Tribunal member failed to understand the purpose of the email dated 26 March 2024;

(c) The Tribunal member did not understand that there was easy access to the granny flat;

(d) The Tribunal member failed to consider the email dated 15 March 2024 in relation to conversations with the excavator;

(e) The Tribunal member failed to properly understand the terminology of the slab, hard surfaces and spoil;

(f) The Tribunal failed to find that the payment of $1000 to remove the trapped soil was agreed to by the appellants under duress and that the work was still not done;

(g) The Tribunal failed to find that the provisional sum of $4000 was for difficult and restricted access for less than 1.2m wide passage; but this was changed to additional labour and work required to connect services, which were not within the 1.2 m wide access.

(3) The Decision was against the weight of evidence for the reasons set out in Section 6B iii of the Notice of Appeal which we summarise as follows:

(a) More weight should have been given to the appellants' evidence but all of it was dismissed, when it was truthful and substantive;

(b) That the respondent had clearly breached Clause 10 of the contract which meant the appellants could not verify the costs of the provisional amounts which were claimed under the contract

(c) More weight should have been given to the survey and site plan to explain where the spoil had come from;

(d) The Tribunal did not know the difference between a slab, hard surfaces and spoil;

(e) There was no evidence to substantiate the respondent's claim for the provisional sum of $4000;

(4) There is substantial new evidence as referred to in Section 6Biv which was not reasonably available at the time of the hearing which is described as a handout indicating that excavation costs should have been $90 per hour.

1. The appellants contend that there was a pile of spoil that the respondent was required to move under the contract from its location to behind the retaining wall before building the granny flat, but none of it was removed and it is still in situ. The appellants claim that the member did not read the evidence properly and did not take into account the oral evidence of Mr King that the spoil had not been removed.
2. The respondent says in response that the terms and conditions of the contract did not require removal of spoil but there was a provisional sum allowance of $1000 for spoil removal, which is a common provision in a contract such as this one. The respondent says an amount of spoil was removed by the respondent to the value of the provisional sum and as such the provisional sum was expended in full. The respondent says as the appellants did not agree to a quoted amount to remove the remainder of the spoil and did not make any arrangements to have it removed, the respondent proceeded to commence building the granny flat next to the spoil.
3. We note that the Tribunal member sets out her reasoning with respect to the issues surrounding the removal of spoil and its costings at [36] to [59] and found at [39] that there was no evidence that this was part of the contract or a variation or a special request.

1. The appellants claim that pursuant to Clause 10 of the contract for "Provisional Sums", there was an allowance of $4000 which was paid as part of the contract price and should be refunded. The appellants claim that this amount was incurred due to the restricted access for installation of services, which ended up not being necessary because the restricted access issue was overcome by connection of the services over the roof which therefore excluded the need for additional digging for service connection.
2. The respondent contended in reply that the provisional sum of $4000 as set out in Clause 10 of the contract was for additional labour and manual handling required due to difficult and restricted access less than 1.2m wide and that the $4000 amount was applied towards the invoice of Peninsula Plumbing & Gas dated 23 April 2024 for the total amount of $4840 for:

Excavation down behind the retaining wall and tunnel under, cut concrete pathway to connect water, sewer and power. Includes additional labour, upgrading of services and backfill.

1. We note that the Tribunal dismissed this part of the claim for the reasons set out at [60] to [67] and primarily on the basis that the appellants had not discharged the burden of proof as the appellants had failed to provide alternative quotes/pricings/quantity surveyor's report.

1. The appellants contend that because the spoil was not removed, it has now become very heavy clay and almost rock-like and as a result, they have not been able to find a contractor who is willing or able to remove the spoil. They claim that because of the respondent's failure to remove the spoil they have not been able to landscape the area around the granny flat; which has meant that they are unable to rent it either under a residential tenancy agreement or as a short term holiday rental on AirBnB, and as such the granny flat has not produced any income since 30 August 2024.
2. The respondent submitted that:

(1) there was no obligation for the respondent under the contract to remove the spoil;

(2) the appellants have failed to have the spoil removed;

(3) landscaping was not included in the contract;

(4) the respondent has provided an occupation certificate to the appellants;

(5) the granny flat can be inhabited,

and in these circumstances, any loss was attributable to the appellants' failure to mitigate their loss.

1. We note that the Tribunal dismissed this part of the claim for the reasons set out in [68] to [76]. We note that the Tribunal made a finding at [71] that the respondent did not cause this loss of opportunity, and the appellants could have had the spoil removed and then they would have been able to complete the landscaping [72]. At [73] the Tribunal made a finding that the loss of rental income was a direct result of the appellants' actions who took no reasonable steps to remove the spoil.

1. The appellants contend that under Clause 10 of the contact they were entitled to a refund of $1500 which was a provisional sum for longer service trenching and hand digging incurred for services connection.
2. The respondent contends that this was an agreed tender variation and identified as "Tender Variation C-22-0288 item 2.02 at $1500 and that it was an incurred cost.
3. It is not clear from the documents and oral submissions where this has been dealt with in the Decision, but on our reading of the Decision there are findings that the appellants have failed to provide a quantity surveyor's report as to fair and reasonable prices [35], [64] and as such this claim has been included in the dismissal order.

1. It may be difficult for self-represented appellants to clearly express their grounds of appeal. In such circumstances it is appropriate for the Appeal Panel to review an appellant's stated grounds of appeal, the material provided on the appeal and the decision of the Tribunal at first instance to examine whether it is possible to discern grounds that may either raise a question of law or a basis for leave to appeal: see Cominos v Di Rico [2016] NSWCATAP 5 at [13]. We have followed that process in this case.

1. The ground of appeal based on a question of law which is identified by the appellants is the contention that the Tribunal failed to determine the appellant's claim under the Design and Building Practitioners Act 2020 (NSW) (D&BP Act). The appellants conceded at the hearing of the appeal that this claim was not put to the Tribunal. If the claim was not put to the Tribunal to determine at first instance, the claim cannot be the subject of an appeal.
2. In any event, even if the duty provided for under s 37 of the D&BP Act applied to the construction of the granny flat, the appellant had not identified the conduct of the respondent that it is said involved a failure to exercise reasonable care in breach of the duty provided for at s 37 of the D&BP Act, and mindful that the primary members factual findings and determinations in respect of a claimed work order to remove the spoil, a claimed refund of $4000.00 and the loss of rent claim are not disturbed, we do not consider that a claim for breach of the statutory duty provided for at s 37 of the D& BP Act could be maintained on appeal.
3. We do not consider that the material relied upon by the appellants identifies any other question of law.
4. It follows that the appellants have not established an error on a question of law and leave to appeal is required.

1. In order to grant leave to appeal, the Appeal Panel must be satisfied that the appellants may have suffered a substantial miscarriage of justice on the basis that: (a) the decision of the Tribunal under appeal was not fair and equitable; or (b) the decision of the Tribunal under appeal was against the weight of evidence; or (c) significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with).
2. The matters set out in paragraphs 6Bi of the Notice of Appeal identify the bases for leave to appeal for the reason that the Decision was not fair and equitable.
3. The matters set out in paragraphs 6Bii of the Notice of Appeal identify the bases for leave to appeal for the reason that the Decision was against the weight of evidence.
4. In Collins v Urban [2014] NSWCATAP 17 an appeal panel stated at [74 - 78]:

'Accordingly, it should be accepted that a substantial miscarriage of justice may have been suffered because of any of the circumstances referred to in cl 12(1)(a), (b) or (c) where there was a "significant possibility" or a "chance which was fairly open" that a different and more favourable result would have been achieved for the appellant had the relevant circumstance in para (a) or (b) not occurred or if the fresh evidence under para (c) had been before the Tribunal at first instance.

As to the particular grounds in cl 12(1)(a) and (b), without seeking to be exhaustive in any way, the authorities establish that:

If there has been a denial of procedural fairness the decision under appeal can be said to have been "not fair and equitable" - Hutchings v CTTT [2008] NSWSC 717 at [35], Atkinson v Crowley [2011] NSWCA 194 at [12].

The decision under appeal can be said to be "against the weight of evidence" (which is an expression also used to describe a ground upon which a jury verdict can be set aside) where the evidence in its totality preponderates so strongly against the conclusion found by the tribunal at first instance that it can be said that the conclusion was not one that a reasonable tribunal member could reach - Calin v The Greater Union Organisation Pty Ltd [1991] HCA 23; (1991) 173 CLR 33 at 41-42, Mainteck Services Pty Limited v Stein Heurtey SA [2013] NSWSC 266 at [153].

If in either of those circumstances the appellant may have been deprived of a "significant possibility" or a "chance which was fairly open" that a different and more favourable result would have been achieved, then the Appeal Panel may be satisfied that the appellant may have suffered a substantial miscarriage of justice because the decision was not fair and equitable or because the decision was against the weight of the evidence.'

1. The appellants submitted at the hearing of the appeal that the member had not read the submissions and relied on the verbal comments of the respondent and was therefore mislead.
2. Direction 2(d) dated 15 January 2025 made at the callover required the appellants to provide a typed transcript of the relevant parts of the hearing together with a sound recording of the entire hearing if the appellants in the appeal were to rely on what happened at the hearing. The essence of the appellants' submissions that the Decision to dismiss the 4 claims in Order 2 (as identified above) was not fair and equitable and/or was against the weight of evidence, relies on what happened at the hearing, what the evidence was before the Tribunal, not just by way of the documents but also by way of oral evidence and what oral submissions were made and how the hearing was conducted.
3. We are unable to give proper consideration to the appellants' application for leave on these two limbs of cl 12(1) Schedule 4 because we do not know how the hearing was conducted; how the claims were formulated at the hearing (for example the claim for the refund of $1500) and what was the totality of the evidence and submissions before the Tribunal member.
4. The Appeal Panel held in Aboss v Hafeez [2022] NSWCATAP 345 at [32] to [34] where there was no transcript provided and the appellants were seeking leave on the grounds that the decision was against the weight of evidence and not fair and equitable, as follows:

In these circumstances it is impossible for the Appeal Panel to conclude that the decision was against the weight of evidence (as the evidence weighed by the Tribunal is not available to the Appeal Panel): see Shokrgozar v Abouloukme [2017] NSWCATAP 232 at [90]; Whear v Kids on Hayes Street Pty Ltd [2021] NSWCATAP 123 at 24-26; and Watson v Chen [2022] NSWCATAP 44 at [27]- [37].

For the same reason, the Appeal Panel could not determine that any finding made by the Tribunal, or the decision as a whole, was not fair and equitable. The basis upon which the tenant submitted that the decision was not fair and equitable was that "the evidence presented in the tenancy bundle contradicts the decision outcome." That submission cannot be assessed in the absence of the evidence presented in the "tenancy bundle", which the tenant did not provide to the Appeal Panel.

Accordingly, we need not consider further the tenant's application for leave to appeal.

1. Similarly for this appeal, absent the transcript of the hearing, or at least the relevant parts of the hearing, we can not consider the appellants contention that leave to appeal should be considered on the basis that a substantial miscarriage of justice may have been suffered either because Order 2 was not fair and equitable or that Order 2 was made against the weight of evidence, for the reason we can not assess the evidence and submissions which were before the Tribunal or how the hearing was conducted.
2. Insofar as the appellants seek to rely on new evidence, that evidence is set out in section 6 Biii of the Notice of Appeal and is referred to as a handout to establish that the reasonable excavation cost charged to the appellants should have been approximately $90.
3. The Appeal Panel decision in Owen v Kim [2017] NSWCATAP 26 provided at [40]:

The test is whether the report was unavailable because "no person could have reasonably obtained the evidence", not because the appellant was unaware of the need to do so.

1. The appellants contend in the Notice of Appeal that it was available evidence but the appellants state they:

thought any reasonable person would see that my estimate of $90 for extra work for an excavator was fair. The $90 was only for moving spoil an extra metre. Actually it should have cost me nothing,...

1. We do not accept this to be a sufficient reason to satisfy us that this evidence was not reasonably available at the time of the hearing. We are satisfied that the evidence was reasonably available, it is just that the appellants did not obtain it to rely on it.
2. In summary we are not satisfied that there has been any error on a question of law, or that leave should be granted on the basis that the appellants may have suffered a substantial miscarriage of justice arising from any limb in Clause 12(1) Schedule 4 of the NCAT Act.

(1) Leave to appeal is refused.

(2) Appeal 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.