Panico v Mollier Enterprises Pty Limited t/a JC Diesel Tune

EVIDENCE

1. In reaching the conclusions herein, the Tribunal has had regard to the following: 1. The material filed by the applicant on 27 August 2020, 22 October 2020 and 9 November 2020 marked Exhibits A1, A2 and A3 respectively. 2. The material filed by the respondent on 21 September 2020 and 27 October 2020 marked Exhibits R1 and R2 respectively. 3. The oral evidence and submissions of the parties at the hearing on 21 December 2020.
2. The specific documentary and oral evidence is described below in respect of relevant findings.

JURISDICTION

1. The Tribunal's Consumer and Commercial Division has jurisdiction in relation to matters arising under legislation including the Consumer Claims Act 1998 (NSW) (CC Act) which in turn may give rights under the ACL.
2. This jurisdiction and the legislative provisions have now been transferred to Part 6A of the Fair Trading Act 1987 (NSW) (the FT Act), and that is the applicable legislation as this application has been lodged after these changes took effect: see for instance Salloum v Charles Golding t/as Golden Motors [2016] NSWCATCD 72 at [3] to [7], unchallenged and not overturned on appeal: Golding v Salloum [2016] NSWCATAP 267 at [14]
3. The ACL was incorporated into the law of New South Wales, and as a part of the FT Act, by section 28(1) of the FT Act. The ACL consists of Schedule 2 of the Competition and Consumer Act 2010 (Cth), and the regulations under section 139G of that Act (FT Act section 27). The ACL applies to create rights at law in consumers that fall within the terms of the ACL including the consumer guarantee provisions in Part 3-2 of the ACL. Whilst the ACL creates a cause of action at law and a range of remedies for parties, it does not of itself confer any jurisdiction on this Tribunal to hear those actions and provide those remedies.
4. Section 79J of the FT Act gives the Tribunal jurisdiction to hear claims falling under the FT Act, which by operation of section 28 of the FT Act include claims made under the ACL. Section 79D of the FT Act defines a 'consumer' to include a natural person to whom a supplier has supplied or agreed to supply goods or services, whether under a contract or not. The applicant meets the definition of 'consumer' for these purposes.
5. The respondent is a 'supplier' of services as the word 'supply' is defined in section 4 of the CC Act. As is described in Miller's Australian Competition and Consumer Law Annotated, 2020, [CCA.4.520], the notion of 'supply' is the counterpart of 'acquire'. A supply of goods or services must occur as part of a bilateral transaction or dealing under which the other party acquires those goods or services: Cook v Pasminco [2000] FCA 677 cited in Miller's [CCA.4.520]. This occurred in the instant case.
6. The claim arises from the supply of services by the supplier respondent to the consumer applicant and constitutes a claim by the consumer for the payment of a specified sum of money (FT Act section 79F). The services to which the claim relates were supplied in NSW (FT Act section 79K). The claim was made within the period of time allowed in section 79L of FT Act.
7. The claim is otherwise maintainable under the FT Act but as such is subject to the Tribunal's monetary jurisdiction which is limited by section 79S of the FT Act to making orders for the payment of no more than the prescribed amount. The applicant's claim is within the monetary limits prescribed.

SUMMARY OF THE EVIDENCE

1. The applicant's evidence was as follows: 1. The applicant owned a van that he operated as a mobile icecream and coffee business. The van had a stalling and idling problem. 2. The applicant took the van to the respondent on Friday 29 March 2019 to have the stalling and idling problem repaired. The applicant says that his aim was to have the respondent commence work on his van on Monday 1 April 2019. The applicant says that he told the respondent that he needed the van fixed by Friday 5 April 2019 due to work commitments on Sunday 7 April 2019. The applicant says he lost a day's income because of this: Ex A2. 3. The applicant says that during the week of 1 April 2019, he and Mr Blackmore had multiple conversations about the diagnosis and took the van for a test drive. The applicant says that the respondent phoned and said that the van was fixed and could be collected on Friday 5 April 2019. The applicant says that he paid the invoice in full in the sum of $1,777.04. 4. The applicant says that, after collecting the van from the respondent, the van was still stalling and idling and says that on 7 April 2019 he could not get the van to start at all. The applicant says that he had the NRMA attempt to 'troubleshoot' the issues at a cost of $393 but they were not able to solve the problem. However, the invoice at p5 of Ex A2 does in fact include membership fees of $55 and $139 for 'Join on the Road'. The 'Premium Care for 7 April 2019 is $199. 5. The applicant had the van towed back to the respondent and said that the respondent did not offer to fix the van for free. The applicant says that he paid the second invoice of $644.20 for the van's second attendance at the respondent and 'after two attempts' by the respondent, the van was still not fixed. 6. The applicant says that he had the van fixed by a different mechanic for the sum of $335.50: Ex A2, p8. 7. The applicant sought a full refund from the respondent and then, on about 15 October 2019, the applicant complained to the Department of Fair Trading, the record of which is in Ex A2, p11.
2. The respondent's evidence was as follows: 1. The applicant first dropped the van in on about 29 March 2019 for a full service and to check the idle (not the stalling). The respondent's invoice dated 3 April 2019 at p1 of Ex R2 is entitled 'Full Service, Check Idle' and the second page of the invoice states 'Start and assess cutting out at idle' etc. There is nothing in this invoice about checking any stalling. 2. The respondent said in the hearing that he did a full service on the van and 'all tests came back good on the idle'. The respondent said that the applicant then collected the van and that the van was running normally at this time. The respondent said that the applicant said, upon collecting the van, that the van was 'idling perfectly'. 3. The respondent said that the applicant then telephoned that night and said that the van was cutting out and not starting. 4. The applicant then brought the van back to the respondent for a second check. The respondent said that on this occasion the applicant said that there was a different problem, namely that the van was 'not starting'. The respondent said that this was because an 'O-ring' had perished, which was causing the van not to restart even though it had started previously. The respondent said that he replaced the 'injector transit' at his own cost in the sum of $498.18. All of this matches the second invoice issued by the respondent, dated 11 April 2019, at p3 of Ex R2. On this invoice, alongside the item 'injector transit' and the cost of $498.18, are the words '100%' under the heading 'discount'. The invoice is entitled 'Assess vehicle not starting'. The description of work within the invoice is 'Vehicle towed back after initially idling and running fine but started then cut out after idling for approx. 5 minutes…. Reason why vehicle will not restart as it would previously when idle cut out was pressure problem. …Found that small O-ring on return fuel pipe of #3 injector had not fully sealed and had tiny fuel weep. This return line was removed so as to fit injector leak back tested to confirm no one injector had high return fuel volume causing fuel pressure fluctuation. …We believe that due care was taken when cleaning and refitting pipes, but only takes a minute particle of contaminant to affect injector operation. JC Diesel does however accept this is our concern not customers in regards to rectifying issue. …' 5. The respondent said that it was for this reason that he installed the replacement injector transit for $498.18 free of charge. The second invoice concludes with the words 'Test drive again (good).' 6. The respondent said that the applicant collected the van but telephoned again several weeks later wanting 'further work done'. The respondent said that the applicant was 'very rude to [the respondent's] wife' on the telephone. The respondent said that from this point he told the applicant that the respondent no longer wanted to do any work for the applicant. The respondent said that he did not hear from the applicant again until about September 2019 when the applicant asked for his money back.
3. At the hearing on 21 December 2020 Mr Blackmore said that at the telephone conciliation and hearing on 1 October 2020 he waited for the Tribunal's call and then phoned the Tribunal whereupon he was told the matter had been adjourned. Mr Panico by contrast said that the Tribunal member on 1 October 2020 had placed Mr Panico on hold while the Tribunal member attempted to telephone Mr Blackmore. A further dispute arose between the parties in respect of this issue at the hearing of 21 December 2020. However, there is no need to resolve this issue.

THE APPLICABLE LAW

1. Section 267 to 268 of the ACL sets out the remedies that may be available to a consumer if a supplier fails to comply with a consumer guarantee, including the due care and skill guarantee in section 60. Section 267 relevantly provides as follows: 267 Action against suppliers of services ...

(4) The consumer may, by action against the supplier, recover damages for any loss or damage suffered by the consumer because of the failure to comply with the guarantee if it was reasonably foreseeable that the consumer would suffer such loss or damage as a result of such a failure.

1. Division 3 of Part 6A of the FT Act contains provisions relating to orders the Tribunal can make in relation to a consumer claim made under that Part. Section 79N within Division 3 provides that the Tribunal can make an order in favour of a claimant in a consumer claim, which includes an order "that requires a respondent to pay to the claimant a specified amount of money": see FT Act, s 79N(a).
2. Section 60 of the ACL provides: 60 Guarantee as to due care and skill If a person supplies, in trade or commerce, services to a consumer, there is a guarantee that the services will be rendered with due care and skill.
3. The effect of section 60 is to negate the opportunity to contract out of or limit a claim for negligence: Miller, Miller's Australian Competition and Consumer Law Annotated, 42nd ed, LBC, 2020, [60.20].
4. Section 61 of the ACL provides: 61 Guarantees as to fitness for a particular purpose etc. (1) If: (a) a person (the supplier ) supplies, in trade or commerce, services to a consumer; and (b) the consumer, expressly or by implication, makes known to the supplier any particular purpose for which the services are being acquired by the consumer; there is a guarantee that the services, and any product resulting from the services, will be reasonably fit for that purpose. (2) If: (a) a person (the supplier ) supplies, in trade or commerce, services to a consumer; and (b) the consumer makes known, expressly or by implication, to: (i) the supplier; or (ii) a person by whom any prior negotiations or arrangements in relation to the acquisition of the services were conducted or made; the result that the consumer wishes the services to achieve; there is a guarantee that the services, and any product resulting from the services, will be of such a nature, and quality, state or condition, that they might reasonably be expected to achieve that result. (3) This section does not apply if the circumstances show that the consumer did not rely on, or that it was unreasonable for the consumer to rely on, the skill or judgment of the supplier. (4) This section does not apply to a supply of services of a professional nature by a qualified architect or engineer.
5. Claims under sections 60 and 61 of the ACL may only be limited, or contracted out of if permitted to do so by the exceptions to section 60 and 61: Miller's, supra, [60.20], [61.40]. None of the exceptions to sections 60 or 61, as contained in sections 63 or 65 of the ACL, apply in the instant case. The exception under section 61(4) also does not apply.
6. The respondent provided services within the meaning of section 60 as that term is defined in section 2 of the ACL and as contemplated in Scenic Tours v Moore [2018] NSWCA 238. Under section 79F(1) of the FT Act the services must also have been provided 'in trade or commerce', for the Tribunal to have power to hear and determine a consumer claim under the ACL: see for instance Skiba v Serendipity (WA) Pty Ltd t/as Advanced Personal Management [2019] NSWCATAP 224 at [5]. In the instant case the services were clearly provided in trade or commerce, which is defined to include any 'business or professional activity whether or not carried on for profit': section 2 of the ACL.

Were the services carried out with due care and skill - section 60

1. The phrase "due care and skill" in s 60 of the ACL is equivalent to the common law duty to take reasonable care: Let's Go Adventures Pty Ltd v Barrett [2017] NSWCA 243 at [6] (Basten and Gleeson JJA). Therefore, the consumer guarantee that services be provided with due care and skill that is implied into consumer contracts is a guarantee that the services will be performed in a "careful, skilful, and workmanlike" manner. However, the test is an objective test (Mayne Nickless Ltd v Crawford (1992) 59 SASR 490; Read v Nerey Nominees Pty Ltd [1979] VicRp 6; [1979] VR 47 at 49; S.G. Corones The Australian Consumer Law (2011) Lawbook Co pp 361-362), and all of the facts and circumstances must be considered in the context of the application of an objective standard of due care and skill: see for instance Liu v Zaccaria trading as Precision Automotive Engineers [2017] NSWCATCD 59 from [71].
2. For the purposes of section 60, the question of whether there has been a failure to carry out the services with due care and skill is not one to be considered in the abstract, but in the context of the contractual terms agreed by the parties. The standard required under the contract, or by the ACL, is not perfection: RG Concrete & Polish Pty Ltd v Smart (Civil Claims) [2019] VCAT 722 at [55].
3. In the instant case the documentary evidence, in the form of the first invoice issued by the respondent, shows that the van was assessed on the first occasion for a full service and to check the idle. This also corresponds with the very detailed description of the services within the body of the invoice. The second invoice states that on the second occasion the van was 'assessed' for 'not starting', which also corresponds with the very detailed description in the body of the second invoice. The Tribunal accepts that both of these invoices authentically and correctly describe the services provided on both occasions. There was no suggestion by the applicant that the respondent's invoices were fabricated or dishonestly created and both were contemporaneously created.
4. Relations between the applicant and the respondent, although very poor by the time of the hearing on 21 December 2020 (by which time there was a great deal of acrimony between the parties), appeared to have been good as at the time the van was first collected and the first invoice pre-dated that occasion. Relations do not appear to have deteriorated even upon the applicant delivering the van for a second time to the respondent or collecting it again, and the second invoice predates that occasion. There was no reason for the respondent to have inserted anything in the invoices that was inaccurate. In addition, the descriptions in the invoices matched the respondent's evidence given at the hearing, which was given honestly and frankly.
5. Relations between the parties only began to sour, it appears, some weeks after the applicant had collected the van for the second time and then telephoned the respondent and asked for further work to be done on the van. According to the respondent, the applicant was rude on the telephone to the respondent's wife and the respondent therefore refused to do any further work for the applicant. The Tribunal therefore accepts that the descriptions within the invoices were accurate and accepts the descriptions within the invoices on their face as a record of what occurred.
6. The Tribunal therefore also accepts that the respondent installed the injector transit at a cost of $498.18, free of charge, contrary to the applicant's evidence that the respondent refused to rectify any aspect of the work for free.
7. The van was also available for collection by the applicant within a reasonable time on each occasion that it was delivered to the respondent. On the first occasion, the van was ready for collection by the following Friday 1 April 2019, despite the tight timeframe, and on the second occasion there is no evidence that it was not ready for collection within a reasonable time.
8. Based on the description in the two invoices, the Tribunal finds that the respondent carried out the work with due care and skill and in line with the terms agreed between the parties. There is no breach of section 60 of the ACL. The application pursuant to section 60 of the ACL is dismissed. In making this finding the Tribunal has had regard to the respondent having already replaced the injector transit at a cost of $498.18, free of charge.

Were the services reasonably fit for purpose - section 61

1. For a breach of section 61 of the ACL to be found, there must be evidence that the applicant had made known to the respondent the purpose for which he required the services: Miller's [ACL.61.80] citing Zoneff v Elcom (1990) 94 ALR 445. The evidence demonstrates that this occurred.
2. The exception in section 61(3) does not apply in this case because the evidence shows that applicant did rely on, and that it was reasonable for the applicant to rely on, the skill or judgment of the respondent. The respondent bears the onus on that issue: Effem Foods Ltd v Nicholls [2004] NSWCA 332.
3. As was observed in Wade v J Daniels and Associates Pty Ltd [2020] FCA 1708 from [327], sections 60 and 61 of the ACL were the subject of detailed consideration by the NSW Court of Appeal (Payne JA, Sackville and Barrett AJJA) in Scenic Tours Pty Ltd v Moore [2018] NSWCA 238; 339 FLR 244. One aspect of that decision, concerning the operation of s 275 of the ACL and s 16 of the Civil Liability Act 2002 (NSW), was overturned by the High Court: see Moore v Scenic Tours Pty Ltd [2020] HCA 17; 94 ALJR 481. However, the NSW Court of Appeal's consideration of ss 60 and 61 of the ACL was not the subject of the appeal.
4. Sackville AJA further observed that the consumer guarantees in ss 60 and 61 are integral components of the statutory scheme designed to afford protection to consumers who do not receive the services they reasonably expect to receive from a supplier (at [182]). Nevertheless, the legislation does not seek to impose impossible burdens on service providers; the guarantees require that the supplier will provide services with due care and skill and that services are reasonably fit for the purpose made known by the consumer (at [183]).
5. The phrase "particular purpose" in s 61 of the ACL has been construed broadly in the predecessor provisions in legislation governing the sale of goods. A particular purpose is a definite purpose that has been expressly or impliedly communicated, but it need not be a purpose that is special or individual to the consumer concerned: David Jones Ltd v Willis [1934] HCA 47; (1934) 52 CLR 110 at 121 (Starke J); and at 128 (McTiernan J); Grant v Australian Knitting Mills Ltd [1935] UKPCHCA 1; (1935) 54 CLR 49 at 60 (Lord Wright).
6. While the applicant has not made out in his material the difference between what he says were the services contracted for and the services that he was provided (as also occurred in Wade v J Daniels and Associates Pty Ltd [2020] FCA 1708 at [333]), the Tribunal has done the best it can. On the evidence, as described above at paragraphs 25-29 in particular, the Tribunal is not convinced that the services contracted for were not reasonably fit for the disclosed purpose. On the first occasion the van was delivered for a 'full service, check idle', which appears to have occurred in a workmanlike manner according to the very detailed content of the first invoice. On the second occasion the van was delivered to be 'assessed' for 'not starting' which also appears to have occurred in a workmanlike manner according to the detailed content of the second invoice. On the second occasion, to fix the problem, the respondent replaced the injector transit at a cost of $498.18, free of charge.
7. There is no breach of section 61 of the ACL and the application pursuant to section 61 is dismissed.

Conclusion

1. In making any orders under the FT Act, the Tribunal is obliged to have regard to the matters set out in section 79U of the FT Act, including primarily that the Tribunal must be satisfied that the orders will be fair and equitable to all the parties to the claim. The Tribunal is satisfied that it is fair and equitable to all the parties to order that the application be dismissed.

CONCLUSION

1. For the reasons herein, the application is dismissed.
2. Neither of the parties made any submissions in respect of costs nor indicated that they intended to seek them. In any event, the Tribunal observes that the circumstances in Rule 38(2) of the Civil and Administrative Tribunal Rules 2014 (NSW) do not prima facie exist in the instant case.

NOTATION:

1. A certified copy of the above money order may be obtained from the Tribunal for the purposes of enforcement action through the Local Court.

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: 20 August 2021