Modern Design Wardrobes Pty Ltd v Clayton

Reply

1. The respondents have filed a Reply challenging the assertions of Modern Design and providing detailed responses to each of the grounds of appeal.

Tribunal Decision

1. The Tribunal found that Modern Design operated a business supplying and installing wardrobes and since 28 March 2018 was the holder of a Contractor Licence under Pt 3 of the HBA entitling it to perform residential building work namely carpentry and joinery work.
2. On 3 November 2020, Modern Design and the respondents entered into an agreement pursuant to which Modern Design agreed to supply and install two built-in wardrobes at the respondents' premises in a Sydney suburb for the cost of $8,400 in accordance with certain plans. The Tribunal found that such sum was paid to Modern Design.
3. The Tribunal found that wardrobes were installed on 24 November 2020. However there were numerous defects found in the design and in the installation of the wardrobes. In consequence, the Tribunal found that the warranties provided by s 18B of the HBA had been breached by Modern Design. Accordingly the Tribunal granted relief in favour of the respondents.
4. In assessing the appropriate orders, the Tribunal considered whether an order should be made requiring Modern Design to return to the premises to rectify the wardrobes which they had provided. However, the Tribunal found, after considering the evidence, that because of animosity between the parties and because the respondents were adamant that Modern Design not be permitted to return to their premises, it was not appropriate for Modern Design to attend the respondents' premises to rectify the defective work. Accordingly, the Tribunal made the orders which are now appealed from.

Submissions

1. Both Modern Design and the respondents have provided submissions, both in writing and orally. Before these will be considered in detail however, the Tribunal is required to consider the question whether leave should be granted to Modern Design to bring the appeal

Nature of appeal

1. This appeal has been instituted under s 80 of the Civil and Administrative Tribunal Act 2013 (NSW) ("the CATA"). It is an internal appeal as provided by s 80(2)(b). Pursuant to Sch 4, cl 12(1) to the CATA, an Appeal Panel may grant leave under s 80(2)(b) of the CATA only if it is satisfied that the appellant may have suffered a substantial miscarriage of justice because: (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. In Collins v Urban [2014] NSWCATAP 17, the Appeal Panel referred to the requirements for a grant of leave and at [84] said: "…(1) in order to be granted leave to appeal, the applicant must demonstrate something more than that the primary decision-maker was arguably wrong in the conclusion arrived at or that there was a bona fides the challenge to an issue of fact: BHP Billiton Ltd v Dunning (2013)CA NSW 421 at [19] and the authorities cited their; Nakad v Commissioner of Police, NSW Police Force (2014] NSWCATAP 10 at [45); (2) ordinarily it is appropriate to grant leave to appeal only in matters that involve: (a) issues of principle; (b) questions of public importance or matters of administration or policy which might have general application; orc (c) an injustice which is reasonably clear, in the sense of going merely beyond 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."
3. In summary it must be demonstrated that an appellant may have suffered a substantial miscarriage of justice because the decision of the Tribunal was not fair and equitable; or the decision under appeal is against the weight of evidence; or new evidence has arisen that was not reasonably available at the time of the hearing.
4. The notice of appeal has not been prepared by a legally qualified person and accordingly the Tribunal must discern the nature of the appeal as was considered in Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69 (Prendergast) at [12]. The Appeal Panel identifies the issues as follows: 1. The decision was not fair and equitable; thereby resulting in a substantial miscarriage of justice; 2. The Tribunal failed to understand the evidence adduced by Modern Design; 3. The Tribunal did not decide the proceedings according to law.

Applicable legal principles governing appeals

1. Section 80(2)(b) of the CATA states: Any internal appeal may be made: (a) in the case of an interlocutory decision of the Tribunal at first instance - with the leave of the Appeal Panel, and (b) in the case of any other kind of decision (including an ancillary decision) of the Tribunal at first instance - as of right on any question of law, or with the leave of the Appeal Panel, on any other grounds."
2. Clause 12 of Schedule 4 to the CATA states: An Appeal Panel may grant leave under section 80 (2) (b) of this Act for an internal appeal against a Division decision only if the Appeal Panel is satisfied the appellant may have suffered a substantial miscarriage of justice because: (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).
3. The decision under appeal is a primary decision of the Consumer and Commercial Division.
4. A question of law may include, not only an error in ascertaining or characterising the legal principle or statutory provision or in applying it to the facts of the case, but also taking into account an irrelevant consideration or not taking into account a relevant consideration, which includes not making a finding on an ingredient or central issue required to make out a claimed entitlement to relief: see CEO of Customs v AMI Toyota Ltd (2000) 102 FCR 578 (Full Ct); [2000] FCA 1343 at [45], applying the statement of principle in Craig v State of South Australia (1995) 184 CLR 163 at 179; [1995] HCA 58.
5. These categories are not exhaustive of errors of law that give rise to an appeal as of right. In Prendergast at [13], the Appeal Panel enunciated the following as specifically included: 1. whether the Tribunal provided adequate reasons; 2. whether the Tribunal identified the wrong issue or asked the wrong question; 3. whether it applied a wrong principle of law; 4. whether there was a failure to afford procedural fairness; 5. whether the Tribunal failed to take into account a relevant (that is, a mandatory) consideration; 6. whether it took into account an irrelevant consideration; 7. whether there was no evidence to support a finding of fact; and 8. whether the decision was legally unreasonable.
6. A failure to deal with evidence may also, in the appropriate circumstances, be characterised as a failure to have regard to a relevant consideration or a failure to have regard to critical evidence. It is generally not mandatory to consider particular evidence: Rodger v De Gelder; [2015] NSWCA 211; (2015) 71 MVR 514 at [86]; Allianz Australia Insurance Ltd v Cervantes [2012] NSWCA 244; (2012) 61 MVR 443 at [15] per Basten JA (McColl and Macfarlan JJA agreeing). However, by s 38(6)(a) of the CATA, the Tribunal "is to ensure that all relevant material is disclosed to the Tribunal so as to enable it to determine all of the relevant facts in issue in any proceedings." This obligation includes an obligation to have regard to material which has been disclosed to the Tribunal and which is relevant to the facts in issue, at least where that material is of some significance. Further, at common law, where a decision-maker ignores evidence which is critical to an issue in a case and contrary to an assertion of fact made by one party and accepted by the decision-maker, this is an error of law: Mifsud v Campbell (1991) 21 NSWLR 725 at 728; Pollard v RRR Corporation Pty Ltd [2009] NSWCA 110 at [62]-[63]; Eadie v Harvey [2017] NSWCATAP 201 at [61]-[62].
7. Legal unreasonableness can be concluded if the Appeal Panel comes to the view that no reasonable tribunal could have reached the primary decision on the material before it: Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223 at 230; Minister for Immigration and Citizenship v Li (2013) 249 CLR 332 at 364; [2013] HCA 18 (Li) at [68]. A failure properly to exercise a statutory discretion may be legally unreasonable if, upon the facts, the result is unreasonable or plainly unjust: Li at 367, [76]. There is an analogy with the principle in House v The King (1936) 55 CLR 499 at 505; [1936] HCA 40 that an appellate court may infer that there has been a failure properly to exercise a discretion "if upon the facts [the result] is unreasonable or plainly unjust" and legal unreasonableness as a ground of judicial review: Li at 367; [76]. Further, there is some authority to the effect that unreasonableness as a ground of review may apply to factual findings, although this has not been finally resolved: see Pilbara Infrastructure Pty Ltd v Economic Regulation Authority [2014] WASC 346 at [153]; Wehi v Minister for Immigration and Border Protection [2018] FCA 1176 at [29]; Legal Profession Complaints Committee v Rayney [2017] WASCA 78 at [193].
8. Turning to errors of fact, in Collins v Urban, after an extensive review from [65] onwards, the Appeal Panel stated at [76]-[79] and [84(2)] as follows: "76 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. 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]. 78 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. 79 In order to show that a party has been deprived of a "significant possibility" or a "chance which was fairly open" of achieving a different and more favourable result because of one of the circumstances referred to in cl 12(1)(a), (b) or (c), it will be generally be necessary for the party to explain what its case would have been and show that it was fairly arguable. If the party fails to do this then, even if there has been a denial of procedural fairness, the Appeal Panel may conclude that it is not satisfied that any substantial miscarriage of justice may have occurred - see the general discussion in Kyriakou v Long [2013] NSWSC 1890 at [32] and following concerning the corresponding provisions of the [statutory predecessor to CATA (s 68 of the Consumer Trader and Tenancy Tribunal Act)] and especially at [46] and [55]. … 84 The general principles derived from these cases can be summarised as follows: … (2) Ordinarily it is appropriate to grant leave to appeal only in matters that involve: (a) issues of principle; (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, …"

Observations

1. Almost all of the submissions of Modern Design relate to issues of fact. Accordingly this raises the question whether the Tribunal should grant leave to bring the appeal on the basis of the decision not being fair and equitable. This requires the Appeal Panel to consider whether the Tribunal constructively failed to exercise jurisdiction as considered by the High Court of Australia in House v the King (1936) 55 CLR 499, 504-505; [1936] HCA 40 where the Court explained: "The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges comprising the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so."
2. The decision of the Tribunal member does not indicate any failure to comprehend the facts before him. The decision reveals a careful analysis of each complaint. The Tribunal understood the nature of the proceedings brought before it. No specific matter has been raised by Modern Design which indicates any of the failures by the Tribunal referred to in the above decision. Modern Design disputes the making of a money order rather than a work order in relation to the defective work, as s 48MA of the HBA states that in determining a building claim, the Tribunal is to have regard to the principle that rectification of the defective work by the responsible party is the preferred outcome. However, the Tribunal has a discretion in determining whether or not to make such order.
3. The Tribunal identified reasons why it determined that in the circumstances of this case it was preferable to make a money order. The decision contains careful reasoning. The matters which the Tribunal took into account were matters which are relevant to the exercise of its discretion. The Appeal Panel can find no error in the House v The King sense which would lead to a jurisdictional error. There is no error shown in the Tribunal's careful reasoning in determining to make a money order instead of a work order.
4. There is no suggestion of procedural unfairness; nor is there any basis to consider that the Tribunal failed to respond to any argument. Indeed, the analysis of the facts by the Tribunal is detailed.
5. In these circumstances, the Appeal Panel is unable to discern any basis for the assertion that the decision is not fair and equitable; or that the Tribunal failed to understand the evidence adduced by Modern Design; or that proceedings were not determined according to law. Ultimately the Tribunal preferred the evidence of the respondents when it found there were numerous defects in non-compliance with the plans and also unsatisfactory installation.
6. It follows that in the absence of any demonstrable error of law, there is no basis for asserting that there has been a substantial miscarriage of justice. Accordingly the Appeal Panel does not grant leave to bring the appeal insofar as leave is required; and the appeal is otherwise dismissed.
7. The respondents requested a period of six months before the wardrobes are removed as provided by order (2) made on 6 August 2021. However, if payment, which includes the cost of removing the wardrobes, is to be made promptly pursuant to (1) of such orders, it is only appropriate that the wardrobes should be returned promptly. Accordingly the Appeal Panel will make orders identifying a date for payment and for removal.

Orders

1. The Appeal Panel orders that: 1. Leave to appeal is refused; 2. The appeal is dismissed; 3. The stay granted on 10 September 2021 is lifted; 4. The time for payment of the money order referred to in order (1) made on 6 August 2021 is extended to 3 December 2021; 5. The removal of the wardrobes as referred to in order (2) made on 6 August 2021 is to be carried out on or before 17 December 2021.

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: 23 November 2021