Was the Tribunal correct to conclude the evidence did not prove the initial unit allocation was unreasonable?
- At [39]-[42] the Tribunal said:
39 Mr Tan, despite his lack of corroborative evidence also raises in his cross-examination of Mr McKenzie the discrepancy between the value attributed between the same lots in the same position in the building, the south-west corner, Lot 1 on level I with 146 square metres, Lot 8 on level 2 with 107 square metres and Lot 15 on level 3 with 113 square metres. Mr McKenzie has valued each of those lots as follows:
Lot Number Valuation Initial UE Proposed UE
1 $455,000 40 36
8 $485,000 37 38
15 $450,000 35 37
40 Mr McKenzie was unable to justify the discrepancy.
41 To grant the orders sought by the applicant, the Tribunal must be satisfied that the allocation of unit entitlements was unreasonable when the strata plan was registered.
42 The Tribunal is not satisfied that the evidence adduced by the applicant supports the Tribunal making a finding that the allocation of unit entitlements at the time when the strata plan was registered was unreasonable. The expert evidence relied upon by the applicant is for the reasons set out above not at the correct date and cannot be relied upon to support the applicant's case. Further, the evidence has been challenged in cross-examination of Mr McKenzie and he has not been able to support his contention as to Lots 1, 8 and 15. He has not inspected individual units and cannot satisfy an enquiry as to how he comparatively values one lot from another lot under any scrutiny. Mr Rennie's expert evidence is compromised and in any case only values part of the lots in the scheme and cannot be relied upon to challenge the reasonableness of the initial allocation of the unit entitlements.
- It seems clear from these reasons that, in addition to its finding that the valuation was not at the correct date (a matter which we have concluded was wrong at law), the Tribunal has in any event considered the valuation evidence and rejected the evidence of value because Mr McKenzie was not able to substantiate his opinions in relation to Lots 1, 8 and 15.
- At this point it is important to note the Appeal Panel was not provided with a sound recording of the hearing. However, the appellant accepted that in cross-examination his expert, Mr McKenzie, had not been able to explain his opinion as to the value of Lots 1, 8 and 15 as was recorded in the Tribunal's reasons.
- The appellant raises two grounds of appeal in relation to the conclusion concerning the expert evidence. One was that he was denied procedural fairness. The other was that the Tribunal reached an incorrect conclusion in respect of the valuation evidence. The first raises a question of law. The second does not raise a question of law and requires leave to appeal.
- As to the procedural fairness ground, the appellant says he was told at an earlier directions hearing that cross-examination of his witness would not be permitted because only "an Expert witness could only be challenged by another expert witness and that the Tribunal would not accept a challenge to an Expert Witness by a layperson". However, again no sound recording was provided of this directions hearing.
- Be that as it may, it is clear from the appellant's submissions to the Appeal Panel that he was provided with an opportunity at the original hearing to make submissions concerning his expert's evidence and the answers given by his expert in cross-examination. In these circumstances, we do not accept the appellant was denied procedural fairness or that the Tribunal made any error of law in the manner in which the hearing was conducted.
- The final question to consider is whether the decision of the Tribunal on the factual question of whether the original unit allocation was unreasonable was in error and whether or not leave to appeal on this question should be granted.
- The appellant, in his notice of appeal, does not seek leave to appeal on a question other than a question of law. However, in circumstances where a party is self-represented, in may be necessary for the Appeal Panel to consider the nature of the issues raised and properly categorised these issues for the purpose of determining whether or not leave is required: see Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69 at [12].
- To the extent necessary, we would give leave to amend the Notice of Appeal to seek leave. This approach is consistent with the guiding principle in s36 of the NCAT Act to facilitate the just, quick and cheap resolution of the real issues in dispute. As the issue was otherwise raised by the appellant in his submissions, the grant of leave to make formal amendments could not give rise to any relevant prejudice to the respondents who have provided submissions in response.
- In the present case, the grant of leave to appeal requires the appellant to show he may have suffered a substantial miscarriage of justice because the decision was not fair and equitable or was against the weight of evidence. As stated by the Appeal Panel in Collins at [76], this requires the appellant to satisfy the Appeal Panel that:
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 circumstances in (a) or (b) not occurred…
- As to whether a decision is not fair and equitable or was against the weight of evidence, the Appeal Panel went on to say in Collins and [77]:
77 As to the particular grounds in cl 12(1)(a) and (b), without seeking to be exhaustive in any way, the authorities establish that:
(1) 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].
(2) 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) 173 CLR 33 at 41-42, Mainteck Services Pty Limited v Stein Heurtey SA [2013] NSWSC 266 at [153].
- As stated in Sahade, a mandatory requirement for the Tribunal to consider in deciding whether or not the original unit entitlement was unreasonable is the respective values of the lots at the time of the strata plan was registered. As is evident from the legislation to which we have referred above and from what the Court of Appeal said in Sahade, this evidence is used to determine the relative values of the Lots and is a consideration which must be taken account of in determining whether the particular unit entitlement allocations are unreasonable.
- Where an expert is unable to justify the basis for the valuation of each Lot or some of the lots within a strata scheme, it was an available conclusion for the Tribunal to find the applicant had failed to establish the original unit entitlements were unreasonable.
- While there was other evidence at the original hearing from Mr Rennie, this evidence was prepared at a different point in time and, more particularly, did not provide relevant evidence of the valuations of Lots 1, 8 and 15 or their relative values. Accordingly, it does not assist the appellant to show error on this aspect of the Tribunal's decision.
- In reaching this view we have not had recourse to the subsequent report prepared, for the purposes of this appeal, by Mr Rennie. As mentioned above (at [18]) it was conceded that this evidence could have been provided at the first instance hearing. Accordingly, it was not "new" evidence (being evidence that was not reasonably available at the time of the first instance hearing), as required by Sch 4, cl 12(1)(c) of the NCAT Act.
- Further, while this issue was not dealt with by the Tribunal at first instance, the evidence from Mr Rennie (to which we were referred on appeal and which was before the Tribunal at the original hearing) suggests that Mr McKenzie was also in error in his valuation of Lot 21 and consolidated Lot 28 and his assessment of equal unit entitlements. Again while the evidence of Mr Rennie related to a valuation at a different point in time (namely the time the plan of consolidation was registered), nonetheless Mr Rennie's valuation points to differing features between the two lots, including the use of the properties, number of available parking spaces and their position to street frontage which suggest that Lots 21 and 28 should not have been ascribed the same value. This evidence does not support a conclusion that the original unit allocations as provided in the schedule of unit entitlements recorded in Strata Plan SP 69904 on registration were unreasonable. It does not support the appellant's valuation. This is for the reason that those Lots which became consolidated Lot 28 were of greater value than Lot 21 and should have had allocated a relatively higher unit allocation to that of Lot 21, not an equal unit entitlement as proposed by the appellant and his expert.
- In these circumstances, the Tribunal's decision that the appellant had failed to show the original unit allocation was unreasonable could not be said to be against the weight of evidence nor could it be said to be not fair and equitable. It follows that we are not satisfied upon a consideration of the evidence as a whole that the appellant may have suffered a substantial miscarriage of justice or that the decision was wrong in fact.
- Accordingly, leave to appeal should be refused and the appeal should be dismissed.