Leo and Fang v Conrad Homes Pty Ltd

1. The decision of the 15 April 2025 (the Decision) is the subject of this appeal. A Notice of Appeal was lodged on 9 May 2025. The Appellant seeks orders from the Appeal Panel to the effect that order 2 made on 15 April 2025 be set aside. If the appeal is successful, the result would be that the monetary order made on 10 January 2025 would remain in effect. If the appeal is unsuccessful the result would be that the proceedings at first instance must be heard again.

1. The relevant findings of fact and reasoning recorded in the Decision may be summarised as follows:

(1) There is no dispute that the decision made on 10 January 2025 took place in the absence of the "builder" (being the Respondent to this appeal).

(2) The fact that the builder was absent from the hearing meant that the builder did not put before the Tribunal any evidence or submissions concerning the claims made in the Appellants' application, including "expert evidence such as the report by Anthony Capaldi filed in related Supreme Court proceedings" (Capaldi report). The Tribunal stated that it was satisfied that the "builder's absence resulted in its case not being adequately put to the Tribunal".

(3) Since both requirements of cl 9(1)(b) are satisfied, the discretion whether or not to set aside the decision of 10 January 2025 is enlivened.

(4) The central question in exercising the discretion (i.e. whether or not to set aside the earlier decision) is whether there is a real likelihood that it would be unjust to let the decision sought to be set aside stand.

(5) Justice generally requires the parties against whom orders are made to be given a reasonable opportunity of appearing and presenting their case.

(6) 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.

(7) It is relevant as to why the party was absent and whether the absent party had a reasonable opportunity to be heard. Here, the Notice of Hearing, orders and correspondence from the Tribunal were sent to the builder's registered address as it appears on the ASIC search at Doonside, being the previous residential address of the sole director.

(8) It may be the case that here the builder was inept or inefficient in failing to update its registered office or arrange for mail to be forwarded. However, the Tribunal was not persuaded by the evidence that the builder deliberately ignored the opportunity to attend and present its case, at the Tribunal.

(9) It was open to the Appellants, once the builder failed to attend the first directions hearing, to assist the Tribunal by providing alternative addresses for service, such as the Grose Vale address (being the new residential address of the sole director of the Respondent) and being the address used for service in the related Supreme Court proceedings. The Appellants did not assist the Tribunal in that regard.

(10) If the set aside order is not made there will be prejudice to the Appellants. The Decision describes the nature of that prejudice and that that is a matter that is relevant to be taken into account in considering whether to set aside the earlier decision.

(11) Notwithstanding the prejudice to the Appellants, the builder ought to be allowed the opportunity to present its case in defence of the claims made against it at a fresh hearing.

(12) The Tribunal found that there is "a real likelihood of practical injustice" if the original decision is allowed to stand and the builder is not given the opportunity to be heard or otherwise have it submissions considered in relation to the Appellants' original application.

1. The decision of the Tribunal (reflected in order 1) to extend the time for lodgement of the set aside application is not the subject of this appeal.

1. It is convenient to set out the full text of clause 9 of the Regulation:

9 Additional power to set aside or vary decision determining proceedings

(1) In addition to any power that is expressly conferred on the Tribunal by the Act or enabling legislation to set aside or vary its decisions, the Tribunal may order that a decision it has made that determines proceedings be set aside or varied in either of the following circumstances--

(a) if all of the parties to the proceedings have consented to the making of the order to set aside or vary the decision,

(b) if the decision was made in the absence of a party and the Tribunal is satisfied that the party's absence has resulted in the party's case not being adequately put to the Tribunal.

Note : The following provisions of the Act are examples of provisions that expressly confer powers to set aside or vary decisions of the Tribunal--

(a) section 45 (3) (which enables the Tribunal to revoke leave granted to a person to represent a party),

(b) section 53 (4) (which confers a power on the Tribunal to set aside proceedings and decisions involving procedural irregularities resulting from a failure to comply with provisions of the Act or the procedural rules in relation to the commencement or conduct of proceedings),

(c) section 63 (which confers a power on the President or a presiding member to correct obvious errors in decisions of the Tribunal),

(d) section 64 (3) (which enables the Tribunal to vary or revoke a non-disclosure order made under section 64),

(e) section 73 (3) (which enables the Tribunal to vacate or revoke an order with respect to contempt of the Tribunal).

(2) The Tribunal may make an order under this clause of its own motion or on the application of a party.

(3) Unless the Tribunal grants an extension under section 41 of the Act, an application for an order under this clause must be made within 7 days after the decision concerned was made.

(4) Except where the parties have consented to the making of the order, the Tribunal may not make an order under this clause unless the Tribunal has first--

(a) afforded the parties an opportunity to make submissions about the proposed order, and

(b) taken any such submissions into account.

(5) A party may not make an application for an order under this clause to set aside or vary a decision of the Tribunal if--

(a) an internal appeal or appeal to a court against the decision has been lodged or determined, or

(b) an application for a judicial review of the decision has been made or determined.

(6) A party may not, without the leave of the Tribunal, make an application for an order under this clause to set aside or vary a decision of the Tribunal if the party has previously made an application under this clause to have the decision set aside or varied.

(7) If the Tribunal sets aside a decision under this clause, it may also set aside any orders that it made consequent on the decision that has been set aside.

Note : An example of such a consequent order may be an order for costs in the proceedings.

(8) Proceedings for the purposes of this clause are prescribed for the purposes of section 50 (1) (d) of the Act.

Note : A hearing is not required for proceedings that are prescribed for the purposes of section 50 (1) (d) of the Act.

(9) This clause does not limit any power of the Tribunal to set aside, revoke or vary its interlocutory decisions or any other decisions that do not operate to determine proceedings.

1. At the hearing of the appeal the Appellants' counsel tendered a document headed Amended Grounds of Appeal. The first sentence of that document stated that the Appellants proposed that the grounds of appeal previously lodged be set aside entirely and that the tendered document be considered in its place. That late tender may have put the Respondent to a disadvantage. However, in our view, the appeal does not have merit and we propose to dismiss it. Accordingly, it is not necessary to consider whether or to what extent the late tender of the Amended Grounds of Appeal caused disadvantage to the Respondent.
2. By the Amended Grounds of Appeal, the Appellants challenge order 2 recorded in the Decision. The Amended Grounds of Appeal may be summarised as follows:

(1) The Tribunal erred in its consideration of the material before it on the grounds of finding that:

(i) the Respondent did not "deliberately ignore the opportunity to attend and present its case, at the Tribunal"; and whether consequently or not, making a finding that the Respondent had not had the opportunity to present its case; and

(ii) the Respondent had an arguable defence or that a different decision would have been reached such that the discretion to set aside the prior decision under cl 9(1)(b) was enlivened, when in fact it had not.

1. In support of this ground the Appellants Amended Grounds of Appeal incorporated the following particulars:

(1) The Tribunal below incorrectly identified that the question of whether the Respondent "deliberately ignored the opportunity to attend and present its case at the Tribunal" was what enlivened the Tribunal's discretion to set aside the decision.

(2) With respect, the correct question the Tribunal below should have asked was whether the Respondent had actually been put on notice that the proceedings in the Tribunal below had been commenced such that it had an opportunity to present its case before the Tribunal.

(3) It was not open to the Tribunal on the material before it, (or in the alternative, overwhelmingly against the weight of the evidence) to find that the Respondent was not served with the relevant materials relating to the proceedings in the Tribunal below.

(4) Although the Tribunal correctly identified that the discretion to set aside was enlivened by the proffer of a viable defence it was not open to the Tribunal on the material before it, (or in the alternative, overwhelmingly against the weight of the evidence) to find that the Respondent:

(i) had actually articulated any defence to the claim presented by the Appellant; or

(ii) would have obtained a better result at hearing.

1. In all the circumstances, the discretion to set aside the prior decision was not enlivened.
2. By the Amended Grounds of Appeal the Appellants seek the following orders:

(1) Leave to appeal be granted.

(2) Appeal be allowed.

(3) The order made on 15 April 2025 be set aside.

(4) The Respondent to pay the Appellant's costs of the appeal.

(5) Any further or other order that the Tribunal thinks fit.

1. By the Amended Grounds of Appeal, the Appellants also made brief submissions to the effect that because the Decision is an interlocutory decision leave is required and therefore the Appellants set out the basis for granting such leave.
2. The Appellants submitted that where a document was (as required by legislation) duly served upon a corporate entity, the clear intention of such legislation was that the corporation was thus duly put on notice by such service. It flies against the principle of that legislation to allow a corporate party to simply allege tardiness or incompetence with recordkeeping to prevent that principle from applying. Allowing the Decision to stand would serve as precedent for the proposition that a corporation need not take any care to keep its records accurate or its corporate details up to date, and that other parties must be put to the expense and difficulty of locating them and bringing documents to their attention.
3. The Appellants submitted that it would be a clear injustice if leave was not granted. Allowing the matter to be effectively reheard when the Respondent was properly put on notice of the proceedings would cause prejudice, delay and cost to the Appellants (which the Tribunal identified but did not sufficiently give enough weight).
4. The Amended Grounds of Appel address the requirements of cl 12 sch 4 of the Civil and Administrative Tribunal Act 2013 (the NCAT Act). In relation to ground 1(a) in the circumstances where there was evidence that the Respondent had accepted and stated that its address was X X X X, Doonside, its later averment that it did not receive materials relating to the proceedings in the Tribunal below, could not, with all the material open to the Tribunal below, have led to the finding that the Respondent was not put on notice of the proceedings.
5. In relation to ground 1(b) the Respondent has not specified what actual defence it proposes to put in relation to the Appellants' claim. In circumstances where it was prima facie put on notice of the proceedings via service, it should have taken the opportunity to do so and the failure to do so should be held against it and to allow it to proffer an inchoate defence is neither fair nor equitable over and above basic disappointment on the part of the Appellants.
6. At the hearing, counsel for the Appellants made oral submissions in support of the Amended Grounds of Appeal. Counsel submitted that the real question was whether notice had been given to the Respondent of the Tribunal proceedings. The registered office of the Respondent was the Doonside address and was the appropriate address for service of notices. Further, it has never been clear what defence the Respondent would have put forward. The Capaldi report does not make the Respondent's position clear.

1. The Respondent's counsel made submissions responsive to the Amended Grounds of Appeal and also handed up a document headed "Respondent's Chronology". That document set out a chronology of events. Each of the events was described as "not disputed" by the Appellants. Counsel for the Appellants objected to the description "not disputed" only with respect to the contention that the director of the Respondent did not receive the application filed in the Tribunal or evidence subsequently served.
2. The Respondent's chronology relied upon the affidavit of Frank Lesk dated 6 March 2025 (he being the sole director of the Respondent) in support of the set-aside application.
3. From the chronology (and thereby from Mr Lesk's affidavit) the following non-disputed facts are relevant:

(1) During the relevant period (i.e. in the period from when the Tribunal application was lodged in August 2024 to the Tribunal hearing on 10 January 2025) the registered office of the Respondent was X X X Doonside being the previous place of residence of Mr Lesk. He moved from that address to an address in Grose Vale in 2023. In August or September 2023 Kenneth Leo (the brother of one of the Appellants) visited Mr Lesk at his Grose Vale address.

(2) By letter dated 30 June 2024 Kenneth Leo wrote to Mr Lesk at his Grose Vale address.

(3) On or about 2 August 2024 Kenneth Leo filed a summons in the Supreme Court against the Respondent and Mr Lesk. The summons was served at Mr Lesk's Grose Vale address.

(4) On 21 August 2024, one of the Appellants (Marcus Leo) wrote to MBA Lawyers as the legal representative of the Respondent by email. The email foreshadowed a claim in respect of defective works for which the Respondent was said to be responsible.

(5) On 29 August 2024 the Appellants lodged the proceedings in NCAT.

(6) On 12 September 2024 NCAT conducted a directions hearing in which leave was given for Mr Kenneth Leo to represent the Appellant.

(7) On 2 October 2024 MBA Lawyers wrote to the Appellants stating that they acted for the Respondent. The letter referred to the email from Marcus Leo dated 21 August 2024 and stated that their client was keen to resolve the matter amicably "without resort to litigation".

1. It appears from documents filed in this appeal that a further directions hearing occurred on 11 November 2024 in the Tribunal. We have been provided with a transcript. The transcript reveals that Mr Kenneth Leo appeared for the Appellants. On page 119 of the transcript the member is recorded as asking Mr Leo whether he has had any contact with the Respondent recently or he has tried to contact them. Mr Leo replies in the affirmative and then explains that there had been an inspection recently at the site at which Mr Lesk was present. The transcript reveals that Mr Leo informed the member that the Building Commissioner had issued a rectification order addressed to the Respondent. It appears from the transcript that the member decided to adjourn the proceedings because the rectification order gave the Respondent until 15 November 2024 to comply with it.
2. We have also been provided with a transcript of the hearing that occurred on 10 January 2025. It reveals that the member (not the same member that heard the hearing on 11 November) was informed by Mr Kenneth Leo that the Respondent had not attended the past two hearings before the Tribunal. The member asked whether a notice terminating the contract had been sent to the Respondent and Mr Leo said that it had been sent to the registered office. At the end of the hearing the member is recorded as noting that the Notice of Listing was sent to the Respondent at the Doonside address (which the member described as the registered address and principal place of business of the Respondent). The member stated that he was satisfied that the Respondent had been served.
3. Turning back to submissions made by Counsel for the Respondent, it is necessary to record:

(1) The Respondent submitted that by reason of the absence of the Respondent from the hearing, the Respondent's case was not adequately put. Part of the Respondent's case can be gleaned from the Capaldi report which makes observations about the appropriate nature of rectification work. Counsel for the Respondent pointed out that at the hearing there was no discussion of s 48MA of the Home Building Act 1989 (NSW). That section provides that a court or tribunal determining a building claim involving an allegation of defective residential work is to have regard to the principle that rectification of the defective work by the responsible party is the preferred outcome. Counsel also submitted that the Respondent intended to put forward the defence that it did not engage the contractor responsible for the defective work.

(2) Counsel for the Respondent further submitted that the Appellants or their representative Kenneth Leo (or all of them) knew that Mr Lesk no longer resided at the address of the registered office of the Respondent and that the Respondent had engaged MBA Lawyers. Accordingly, the Appellants knew that in order to give actual notice of the Tribunal proceedings to the Respondent service of notices could be given to the new address of Mr Lesk and/or to MBA Lawyers.

(3) It is also relevant to record that the Capaldi report was prepared after an inspection by Mr Capaldi on 6 December 2024. He attended both the property the subject of the NCAT proceedings and the neighbouring property the subject of Supreme Court proceedings. The Supreme Court proceedings involved, Mr Kenneth Leo as Plaintiff and the Respondent as Defendant.

1. This is an appeal regulated by s 80 of the NCAT Act and also by cl 12 sch 4. The effect is that the appeal lies as of right on any question of law or with leave on the basis provided for by cl 12 sch 4 of the NCAT Act.
2. However, if the Decision is an interlocutory decision then leave is required: s 80(2)(a). The definition of an interlocutory decision is contained in s 4 of the NCAT Act. It lists types of decisions which are defined as interlocutory decisions. This issue was addressed in the Appeal Panel decision in Hammond v Ozzy's cheapest Cars Pty Ltd t/as Ozzy Car Sales [2015] NSWCATAP. There the Appeal Panel concluded that a set aside decision was an ancillary decision for the purposes of s 80(2)(b) at [40] and, accordingly, insofar as grounds of appeal relied upon raise questions of law, leave to appeal is not required. We agree and apply the same approach.
3. We were not specifically addressed by the Appellants as to whether the grounds of appeal raised questions of law. Rather, the Appellants were of the view that leave is required.
4. The Appellants placed some reliance upon s 109X of the Corporations Act 2001 (Cth). That section provides that for the "purposes of any law" a document may be served on a company by leaving it at, or posting it to, the company's registered office. However, s 109X(6) provides that the section does not affect any provisions of another law that permits a document to be served in a different way. In our view, the section does not override the requirements of the NCAT Act. In this regard, s 38(5)(c) of the NCAT Act provides that the Tribunal is to take such measures as are reasonably practicable to ensure that the parties have a reasonable opportunity to be heard or otherwise have their submissions considered in the proceedings. Accordingly, it is our view that the fact that the Tribunal's notices were sent to the registered office does not, of itself, mean that the application under cl 9(1)(b) of the Regulation could not succeed.
5. Dealing with ground 1(a) first, the Appellant's submission is that the Tribunal erred in finding that the Respondent did not deliberately ignore the opportunity to attend and present its case. In our view this ground does not raise a question of law. The Appellants contend that the Tribunal erred in making the finding of fact that the Respondent did not deliberately ignore the opportunity to attend and present its case. It is clear that the Tribunal found that the notices and material concerning the Tribunal proceedings were served on the Respondent's registered office, but that such material did not come to the actual notice of the Respondent's sole director or any other person representing the Respondent. In our view the Tribunal was distinguishing between the formality of service on the registered office as opposed to the practical drawing of attention to the Respondent of the Tribunal proceedings. In our view there was no error in the finding that the Respondent did not deliberately ignore the opportunity to attend and present its case. Indeed, the letter from MBA lawyers is evidence that the Respondent was seeking to engage with the Appellants concerning the dispute between them.
6. Turning to ground 1(b), the Respondent contends that the Tribunal erred in finding that the Respondent had an arguable defence, or that a different decision would have been reached. The Tribunal found that the Respondent was not able to put before the Tribunal any evidence in defence of the Appellants' application "including expert evidence such as the report by Anthony Capaldi filed in related Supreme Court proceedings". The Tribunal found that the result was a "real likelihood of practical injustice". We are of the view that those findings of fact and conclusions were open to the Tribunal and no error is displayed. We also agree with the Respondent's submission that the Respondent was denied the opportunity to raise s 48MA of the Home Building Act.
7. We add the following remarks relevant to the finding of the Tribunal that it was open to the Appellants, once the Respondent failed to attend the first directions hearing, to assist the Tribunal by providing alternative addresses for service and that they did not do so. The transcript of the directions hearing on 11 November and the further transcript of the hearing on 10 January both reveal that there was an opportunity for Mr Kenneth Leo to assist the Tribunal by explaining that the director, Mr Lesk, had a residential address different from the registered office address of the company and that a firm of solicitors had already indicated that they were representing the Respondent. It appears that Mr Leo did not provide such information to the Tribunal. Section 36 of the NCAT Act sets out what is described as the "guiding principle" for the Act and the procedural rules which is that the Tribunal is to "facilitate the just, quick and cheap resolution of the real issues in the proceedings". Section 36(3) imposes upon a party a duty to cooperate with the Tribunal to give effect to the guiding principle. In our view, the Appellants were under a duty to disclose to the Tribunal the residential address of Mr Lesk and the fact that the Respondent had engaged a firm of solicitors. The Tribunal found that there was a "real likelihood of impractical injustice" if the original decision was allowed to stand. In the circumstances, that finding was open to the Tribunal.
8. The grounds of appeal are rejected and, accordingly, we make the following orders:

(1) Order 2 made on 15 April 2025 in proceedings 2024/00319772 is affirmed.

(2) The proceedings at first instance are remitted to the Consumer & Commercial Division of the Tribunal for directions and hearing.

(3) The appeal is otherwise dismissed.

(4) If the Respondent seeks costs, it should file and serve submissions in support of such application within 14 days.

(5) If the Appellants oppose the Respondent's application for costs, the Appellant should file and serve their submissions within 14 days thereafter.

(6) The submissions on costs should address the question of whether the Tribunal may dispense with a further hearing and determine costs on the papers.

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.

28 November 2025 - Order 2 and paragraph 22(2) corrected.