Petropoulos v CPD Holdings Pty Ltd t/as The Bathroom Exchange

Breach of statutory warranty claim - grounds 1, 2, 4(a), 4(b), 4(e), 4 (f) and 4(g)

Tribunal's findings and reasoning

1. The Tribunal found at [63] that there was a small chip on the bath and that the building company had breached the statutory warranty "that the work will be done with due care and skill": Home Building Act, s 18B(1)(a). Once the Tribunal had made that finding, it had power under s 48O to make various orders including an order that the builder "do any specified work or perform any specified service or any obligation arising under this Act or the terms of any agreement": Home Building Act, s 48O(1)(c)(i). When determining such a claim, the Tribunal must "have regard to the principle set out in s 49MA, that rectification of the defective work by the responsible party is the preferred outcome. The Tribunal made the following orders: 1. the builder is to repair the chip on the bath on or before 28 days from the date of this order; 2. the homeowner is to provide reasonable access to the builder to repair the chip on the bath. The builder is to provide to the homeowner 48 hours' notice.
2. The Tribunal's findings and reasoning for making the rectification order in relation to the chip in the bath are set out at [125]: [125] Little evidence has been provided by either party as to the cost of repair to the bath. The builder seeks an order pursuant to section 48MA that he be permitted to rectify the defective work. The home owner opposes such an order being made. The home owner submits that the builder has already been given an opportunity to rectify. The home owner has no confidence whatsoever in the skill and experience of the builder and given the length of time that the dispute has been on foot, it would be fair to say that the relationship between the parties is not a good one. The Tribunal finds that the defect is a minor defect and without any evidence of a scope of work to rectify, the builder should be given an opportunity pursuant to section 48MA to rectify the chip in the bath.

Grounds of appeal

1. The grounds of appeal in relation to the order to repair the chip on the bath are set out in Ms Petropoulos's submissions in chief. She asked the Tribunal to disregard the Notice of Appeal and, instead, to refer to her written submissions. The building company agreed to that course.
2. Relying on those submissions, and what Ms Petropoulos said in oral submissions, we understand that the first ground of appeal is that, in ordering the building company back to rectify the chip to the bath, the Tribunal failed to take the following matters into account. 1. The builder had already been back twice to rectify before the proceedings were commenced. The bath and some tiles were damaged on the second attempt at rectification. 2. The homeowner expressly stated that she no longer wished to have the builder back in her property.
3. The second ground of appeal is that the Member erred when she stated that there was no evidence as to the cost of the work orders.

Consideration

1. The power the Tribunal was exercising when ordering the building company to repair the chip in the bath was under s 48O of the Home Building Act. The relevant parts of that provision are set out below: (1) In determining a building claim, the Tribunal is empowered to make one or more of the following orders as it considers appropriate: (a) an order that one party to the proceedings pay money to another party or to a person specified in the order, whether by way of debt, damages or restitution, or refund any money paid by a specified person, (b) an order that a specified amount of money is not due or owing by a party to the proceedings to a specified person, or that a party to the proceedings is not entitled to a refund of any money paid to another party to the proceedings, (c) an order that a party to the proceedings: (i) do any specified work or perform any specified service or any obligation arising under this Act or the terms of any agreement,
2. By submitting that the Tribunal did not take certain matters into account, Ms Petropoulos may have intended to rely on one of the so-called "relevancy grounds" of appeal. When exercising a discretion as to the appropriate remedy under s 48O of the Home Building Act, a decision maker must take into account mandatory considerations, that is considerations that he or she is " bound to take into account in making that decision": Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; (1986) 162 CLR 24 at 39. Conversely, a decision maker must not take into account forbidden considerations. If the decision maker does either of those things, the decision will be invalid. These grounds are sometimes referred to as the "relevancy grounds": Aronson and Groves, Judicial Review of Administrative Action, (5th ed Law Book Company 2013) at 274.
3. One of the mandatory considerations that the Tribunal must take into account when determining the appropriate remedy under s 48O is set out in s 48MA. The Tribunal is bound to have regard to the principle that "rectification of the defective work by the responsible party is the preferred outcome". (Emphasis added.) In Kurmond Homes Pty Ltd v Marsden [2018] NSWCATAP 23 at [46], the Appeal Panel noted that: … in deciding what order should be made, a court or tribunal may consider whether there is a reasonable basis for any objection raised by the homeowner to the builder being permitted to rectify the defective work, the terms of any order, whether the builder is willing to return and whether such an order would support a timely and cost effective resolution of the dispute.
4. These considerations are relevant considerations but the Tribunal's decision will not be invalid if the Tribunal fails to take them into account. In the context of this case, the Tribunal is not bound to have regard to the fact that the builder had been back twice to rectify the work before the proceedings were commenced, that the bath and some tiles were damaged on the second attempt at rectification or that Ms Petropoulos expressly stated that she no longer wished to have the builder back in the property. It follows that even if Ms Petropoulos had identified one of the relevancy grounds as a question of law, the Tribunal did not make a legal error because it was not bound to take into account the matters she identified.
5. In any event, the Tribunal did take those considerations into account in this case. Ms Petropoulos's submission that the Tribunal did not take into account the history of the attempts at rectification or the fact that she did not want the builder in her home, is incorrect. At [9], we have set out the Tribunal's reasoning and findings at [125] of the decision. The Tribunal acknowledged that Ms Petropoulos opposed the order because the building company had already been given an opportunity to rectify the defects. Despite the relationship having broken down, the Tribunal was satisfied that the building company should be given an opportunity to rectify the defects.
6. Ms Petropoulos has not identified a question of law, nor is there any basis on which it can be said that she suffered a substantial miscarriage of justice because, for example, the Tribunal's decision was against the weight of the evidence.
7. In relation to the second ground of appeal (the Member erred when she stated that she had no evidence as to the cost of the work orders) the Tribunal did not state that there was no evidence as to the cost of the work orders. Rather, the Tribunal stated at [125], that there was "little evidence ... as to the cost of repair to the bath" and that the Tribunal was "without any evidence of a scope of work to rectify". As the submission is not correct, leave to appeal on this ground is refused.
8. Grounds 1 and 2 are dismissed.

Floor dimensions of the shower enclosure - ground 4(a)

Tribunal's findings and reasoning

1. The Tribunal found at [92] that the building company had not breached the statutory warranty in s 18B(1)(a) of the Home Building Act in relation to the floor dimensions of the shower enclosure. Under that provision, implied into every contract to do residential building work is "a warranty that the work will be done … in accordance with the plans and specifications set out in the contract". Ms Petropoulos claimed that the building company had breached this warranty because the contract specified a 900mm x 900mm glass shower screen but an 850mm x 850mm glass shower screen was installed. The issue for the Tribunal was whether the smaller shower screen was "in accordance with the plans and specifications set out in the contract".
2. At [84] the Tribunal identified the principles articulated by the High Court in Toll (FCGT) Pty Ltd v Alphapharm Pty Ltd [2004] HCAT 52; 219 CLR 165 at [40] as being applicable when determining the rights and liabilities of the parties to a contract. In particular, the terms of the contract must be determined objectively: It is not the subjective beliefs or understandings of the parties about their rights and liabilities that govern their contractual relations. What matters is what each party by words and conduct would have led a reasonable person in the position of the other party to believe. References to the common intention of the parties to a contract are to be understood as referring to what a reasonable person would understand by the language in which the parties have expressed their agreement. The meaning of the terms of a contractual document is to be determined by what a reasonable person would have understood them to mean. That, normally, requires consideration not only of the text, but also of the surrounding circumstances known to the parties, and the purpose and object of the transaction. (Emphasis added.)
3. The Tribunal found at [85] that the contract included a quotation that stated: "custom 900 x 900 x 200mm frameless shower screens". The Tribunal also found that the builder had installed 850mm x 850mm showers screens.
4. At [88] the Tribunal set out its understanding of the proper construction of the contract: The Tribunal accepts that the proper construction of the contract is that: (a) it required the installation of the showers in roughly the same locations as the existing showers and with custom frameless shower screens; (b) an assumed shower screen size of 900 x 900 x 200 mm had been allowed as part of the contract price, but that the exact size of the screens would be a matter for decision during the performance of the works, having regard to the size and placement of other items and the obligation of the builder to provide reasonable access to such items, to ensure that the bathroom was fit for purpose.
5. The Tribunal based this ultimate finding of fact on the following specific findings as to the surrounding circumstances: 1. Ms Petropoulos expressed the view before the contract was signed that she wanted the shower screens to be as large as possible (at [86]). 2. The builder's response was that: The rooms are rather small so it will depend on the fittings that you select and what I find when we do the demolition. I suggest that I allow for custom made 900 x 900 mm screens and if you decide to go ahead with my quote we can figure out the exact size during the job. 1. The vanities had not been selected at the time of quotation. 2. After the bathrooms were stripped out, the parties had a conversation about "the space between the corners of the shower screens with 900 mm x 900 mm dimensions and the vanities".

Grounds of appeal

1. The grounds of appeal set out some of the evidence in relation to the size of the shower enclosure and make the following points: 1. the failure to construct the shower screens in accordance with the contract is a clear breach of the statutory warranties incorporated into the contract because the shower screens were not constructed in accordance with the specifications contained in the contract; 2. the Tribunal found that an "assumed" shower screen of 900 mm x 900mm x 200 mm had been allowed when there was no mention of an "assumed size" or any other description that would allow a finding that the size was anything other than a fixed specification; 3. the Tribunal found that the shower enclosure needed to be 850 mm x 850 mm to ensure that it was "fit for purpose" when the builder did not raise that issue in the pleadings or its evidence.
2. We have treated these points as a summary of Ms Petropoulos's grounds of appeal on questions of law. Each of the other points she makes relate exclusively to factual findings. In relation to the first two grounds, there is no dispute, and the Tribunal found, that the builder's quotation for the works stated "Custom 900 x 900 x 200 [mm] frameless shower screens" and that that quotation was then included in the contract. There was no variation to the contract in accordance with cl 13 of the written contract.
3. The Court of Appeal examined this issue in Cherry v Steele-Park [2017] NSWCA 295. Leeming J (Gleeson CJ and White J agreeing) held at [72]-[75] that when construing a contract, the court must have regard to both the contract as a whole and the background circumstances known to both parties. Leeming J observed at [72], that, "very often, nothing in the context will come close to displacing the ordinary grammatical meaning of the legal text". At [75] Leeming held that: The ultimate question is whether the written language of the contract, when considered in light of legitimately relevant surrounding circumstances, permits a constructional choice to be made between two different legal meanings.
4. A court or tribunal cannot "depart from the ordinary meaning of the words used by the parties merely because it regards the result as inconvenient or unjust": McGrath v Sturesteps (2011) 81 NSWLR 690.
5. The Tribunal's error in this case was failing to ask itself whether, in the light of the text of the contract and the relevant surrounding circumstances, there were two different legal meanings of the words, "custom 900 x 900 x 200mm frameless shower screens". If the Tribunal had asked itself that question, it is unarguable that the answer would have been 'no'. There is only one legal meaning of the words "custom 900 x 900 x 200mm frameless shower screens" even taking into account the relevant surrounding circumstances. In our view, because of the conversation that the parties had, especially after the contract had been signed, the Tribunal considered it unjust to conclude that the building company had breached a statutory warranty. But, as we have said, that is not the test.
6. It follows from this analysis that the building company breached the statutory warranty in s 18B(1)(a) of the Home Building Act because it did not build the bathroom in accordance with the plans and specifications set out in the contract. It is appropriate to set aside the Tribunal's decision that there was no breach of the statutory warranties in relation to the size of the shower screen: NCAT Act, s 81(1)(c). In substitution for that decision, it is our decision that the building company did breach the warranty in s 18B(1)(a) that "the work will be done … in accordance with the plans and specifications set out in the contract".
7. The next issue is whether to remit the question of the appropriate remedy, if any, to the Tribunal at first instance or determine that matter ourselves: NCAT Act, s 81(1)(e) and s 81(2). On appeal, the parties made submissions about the appropriate remedy if a breach was found. While those submissions may need to be expanded, it would be quicker and cheaper for us to determine this issue rather than send it back to the Tribunal: NCAT Act, s 36. It would also be in the interests of justice for us to do so if possible, considering the amount in dispute; the hearing time previously consumed in the Tribunal; the extensive evidence before the Tribunal at first instance; the amount of legal costs previously incurred by the parties; and the further cost likely to be incurred if the matter is remitted to determine the appropriate remedy (if any) for the breach. Accordingly we make the following directions: 1. By 14 days from the date of this decision the Appellant is to give to the Tribunal and the First Respondent any further short submissions in relation to the appropriate remedy, if any, for breach of the statutory warranty in relation to the size of the shower screen. Those submissions are to be based on the evidence that was before the Tribunal below. 2. By 28 days from the date if this decision the First Respondent is to give to the Tribunal and the Appellant any further short submissions in relation to the appropriate remedy, if any, for breach of the statutory warranty in relation to the size of the shower screen. Those submissions are to be based on the evidence that was before the Tribunal below. 3. The parties' submission should address the issue of whether the question of the appropriate remedy, if any, can be determined on the papers in accordance with s 50(3) of the NCAT Act.
8. The third point of appeal in ground 4(a) relates to the Tribunal's reference at [88] to the bathroom being "fit for purpose". Ms Petropoulos submitted that the Tribunal should not have relied on that principle because the building company did not rely on it in their pleadings. Alternatively, no evidence was provided to support that finding.
9. The reference to the principle that the bathroom should be "fit for purpose" must be read in context. At [88] the Tribunal was making a finding as to the proper construction of the contract. That finding was that while 900mm x 900mm had been specified in the contract, that specification had to be interpreted in the light of the surrounding circumstances known to the parties. Those circumstances included the discussions before and after the contract was signed. The Tribunal found that in one conversation, the builder had spoken about the size and placement of other items such as the vanity. In making a finding as to what the reasonable person would have understood, the Tribunal took into account the need to provide reasonable access to such items.
10. The Tribunal referred to the "fit for purpose" principle as a reason for supporting its finding about the surrounding circumstances. It was not necessary for the Tribunal to refer to that principle or to make a finding about it. The fact that it did, made no difference to the decision. When a finding, even if made in error, is not material, the Appeal Panel may decline to set aside the decision on that basis: Australian Broadcasting Commission v Bond (1990) 170 CLR 321 at 353.

Tribunal's finding and reasoning

1. This ground of appeal relates to an alleged breach of the statutory warranty in s 18B(1)(a) "that the work will be done with due care and skill". At [71], the Tribunal stated that: The homeowner suggests in the submissions that the builder was under an obligation to advise her when she was selecting the tiles for the bathroom that if she chose larger format tiles then it would be necessary to install traverse cuts. The home owner has not set out clearly the legal or factual basis upon which that claim is made.

Grounds of appeal

1. The crux of this ground of appeal was that the builder should have expressly put the homeowner on notice that 300mm x 300mm tiles would result in lipping and/or would require traverse cutting. Ms Petropoulos submitted that if she had been given that advice, she would have chosen small tiles for the floor to achieve a more aesthetic or quality finish.
2. Ms Petropoulos submitted that she did set out at least the factual basis of her claim that the builder was under an obligation to advise her of the consequences if she selected larger format tiles. In her written submissions, Ms Petropoulos then sets out thirteen aspects of the evidence.
3. She referred to s 18F of the Home Building Act. However, in her submissions in reply on appeal, Ms Petropoulos states that, "the s 18F issue was not a new matter or claim". She attempted to clarify that she was not asserting a claim but rather she was trying to defeat the s 18F defence put forward by the building company. Section 18F provides that: 18F Defences (1) In proceedings for a breach of a statutory warranty, it is a defence for the defendant to prove that the deficiencies of which the plaintiff complains arise from: (a) instructions given by the person for whom the work was contracted to be done contrary to the advice of the defendant or person who did the work, being advice given in writing before the work was done, or (b) reasonable reliance by the defendant on instructions given by a person who is a relevant professional acting for the person for whom the work was contracted to be done and who is independent of the defendant, being instructions given in writing before the work was done or confirmed in writing after the work was done.
4. In oral submissions on appeal, Ms Petropoulos characterised the question of law in this ground of appeal as a breach of procedural fairness.

Consideration

1. Ms Petropoulos claimed, in her case before the Tribunal, that the tiling was defective. That claim failed because the Tribunal accepted the evidence given by the building company's expert witness in preference to the evidence given by the home owner's expert witness. In final written submissions to the Tribunal, Ms Petropoulos claimed that, "[T]he homeowner should have been expressly put on notice, pursuant to s 18F of the Home Building Act that 300 x 300 tiles would result in lipping and/or would require traverse cutting in the first instance". The Tribunal correctly concluded that there was no legal basis for that claim. Section 18F provides a defence to a claim of breach of statutory warranty. It was not considered in this case because the Tribunal found no breach in relation to the size of the tiles.
2. On appeal Ms Petropoulos faintly submitted that the Tribunal had breached procedural fairness by not giving her an opportunity to explain the claim. This ground of appeal cannot succeed because Ms Petropoulos has now acknowledged that she was not making a claim but rather responding to an anticipated defence under s 18F of the Home Building Act. The Tribunal found at [72] that the building company was not able to rely on that defence. In those circumstances there can be no procedural unfairness in failing to give Ms Petropoulos a further opportunity to explain her response to such a defence.
3. Ground 4(b) is dismissed.

Defective falls, the finish to the bath and the joint at vertical wall intersection - grounds 4(e), 4(f) and 4(g).

1. In relation to rectifying defective falls, Ms Petropoulos submits that the Tribunal erred in finding that the builder does not need to rectify the defective falls, on the basis that the homeowner would not let it occur, when no such proposition was put to the homeowner. The building company's response to this ground is that at [72] of the decision, the Tribunal made it clear that it was Ms Petropoulos's own evidence that she did not agree to traverse cuts to the tiles to improve falls to floor wastes. As this was her evidence, it did not need to be put to her that she would not allow the tiles to be cut. We agree with the builder's submission and dismiss this ground of appeal.
2. The ground of appeal relating to the finish to the bath was that the builder's expert witness agreed in cross examination that the tiling finish to the bath needed to be tidied up. Referring to a photograph the building company's expert said, "I would probably add some grout in there and tidy up the silicone around there". But the issue for the Tribunal was whether the building company had breached the statutory warranty "that the work will be done with due care and skill". On the basis of all the evidence, the Tribunal concluded that the finish to the bath did not breach that statutory warranty. If Ms Petropoulos is requesting permission for this ground of appeal to go ahead, she would have to establish that she has suffered a substantial miscarriage of justice because, for example, the decision of the Tribunal under appeal was against the weight of evidence. The Tribunal set out the evidence and gave reasons for its findings. We are not persuaded that those findings were against the weight of the evidence
3. Ground 4(g) relates to the rectification of joint at vertical wall intersection. This ground of appeal was that in conclave, the experts agreed that some work was required to this part of the works. Ms Petropoulos did not explain the significance of that observation or identify a ground of appeal.

Misleading and deceptive conduct claim - ground 4(c)(i)

The Tribunal's finding and reasoning

1. Ms Petropoulos claimed that, under s 18 of the Australian Consumer Law (ACL) the builder had engaged in misleading or deceptive conduct. Section 18(1) provides that: 18 Misleading or deceptive conduct (1) A person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.
2. Ms Petropoulos alleged that four representations made by the builder constitute misleading or deceptive conduct. Three representations are taken from the builder's website and the fourth was an oral representations made by the builder after the contract was entered into. In summary, the conduct was the making of the following representations: 1. "Premium Bathroom renovations in Sydney" 2. "The Director 1. has 21 years' experience in the Home Building Industry 2. is a fully licensed builder and carpenter 3. when you engage the Bathroom Exchange you will be hiring a salesman, you get the experience you expect and need for a quality result"; 1. The Tiler 1. "we use the one tiler on every project we do, this way we manage the quality as closely as possible 2. our tiler Mark is UK trained and has over 18 years' experience; 3. we are pleased to say that Mark is the best tiler we have worked with." 1. Oral representations after the contract was entered into.
3. At [95] the Tribunal observed that there was no dispute between the parties as to the applicable legal principles about misleading or deceptive conduct and it was not necessary to summarise the law. At [96], the Tribunal set out its understanding of the test for misleading or deceptive conduct in the following terms citing Perpetual Trustee Company Limited v Peter Ishak [2012] NSWSC 697: The test for misleading and deceptive conduct is an objective question of fact, to be determined on the basis of the conduct of the parties as a whole viewed in the context of all relevant surrounding facts and circumstances.
4. The Tribunal found that none of the representations constituted misleading or deceptive conduct. In relation to the description of the bathroom renovations as "premium", the Tribunal held at [99], that "premium" was a "descriptive word that is not capable of being assessed as meaning any more than the builder is capable of carrying out premium work". The Tribunal went on: The Tribunal accepts the builder's submissions that the use of the word "premium" demonstrates an expression of an opinion and does not constitute misleading or deceptive conduct unless it is demonstrated that the opinion was not honestly held or not held upon rational grounds. The Tribunal is satisfied that the builder had reasonable grounds for making the representations, having regard to the builder's experience in the building industry.
5. In relation to the representations as to the Director's experience, the Tribunal found that the Director did have the experience described on the website. In relation to the representations about the tiler, the Tribunal understood Ms Petropoulos to be submitting that she was induced to enter the contract by the fact that the builder only used one tiler who was experienced. The Tribunal accepted that that person did not do the tiling work on Ms Petropoulos's bathrooms. From about May 2014, Mr Bodini did the tiling work because Mr Groves became incapacitated. The Tribunal reasoned that, "[W]hether this tiler was Mr Groves or Mr Bodini does not lead to a finding that the statements made in the website were misleading".
6. Finally in relation to the oral representations, the Tribunal decided that as they were made after the contract was entered into, they could not have induced Ms Petropoulos to enter into the contract. The Tribunal then held that even if that conclusion was wrong, it had previously found that there was no breach of any of the s 18B(1) warranties and the home owner had not suffered any loss as a result of any representations made by the builder once the contract was on foot.

Grounds of appeal

1. In her submissions in chief to the Appeal Panel, Ms Petropoulos articulated this ground of appeal as being that in relation to the three representations on the website, the Tribunal applied the wrong test at [99] of the decision. The Tribunal is not satisfied that the use of the word "Premium" in the builder's website amounts to misleading or deceptive conduct. The word "Premium" in a website advertisement for a business is simply a descriptive word that is not capable of being assessed as meaning any more than the builder is capable of carrying out premium work. The Tribunal accepts the builder's submissions that the use of the word "premium" demonstrates an expression of an opinion and does not constitute misleading or deceptive conduct unless it is demonstrated that the opinion was not honestly held or not held upon rational grounds. The Tribunal is satisfied that the builder has reasonable grounds for making the representations, having regard to the builder's experience in the building industry.
2. Ms Petropoulos submitted that "the builder's explanation or opinion is somewhat irrelevant, as the test is whether the representations would mislead, or would likely mislead, an ordinary reasonable person from the relevant class of consumers". Ms Petropoulos recited some of the evidence and submitted that, in all the circumstances, if the Tribunal had applied the correct test, it would have been satisfied that both the website and the oral representations were in breach of s 18 of the ACL.
3. In her submissions in reply, Ms Petropoulos acknowledged that the Tribunal had articulated part of the legal test correctly, but "the Member failed to take into account a number of other relevant issues". The Tribunal applied the wrong test because it failed to consider each of the following "elements": 1. the Tribunal must identify the class of consumers to whom the conduct was directed; 2. the tendency of the conduct or representation to mislead or deceive is to be considered or tested against the ordinary or reasonable members of the class to whom the representation is directed; 3. contravention does not depend on intention; 4. it is not necessary to show actual deception; 5. it is not necessary to adduce evidence to show that a person was actually misled; and 6. it is not necessary to show that conduct endured up to the point of sale.
4. In oral submissions Ms Petropoulos repeated that the ground of appeal was that the Tribunal had applied the incorrect legal test because it did not set out "the full test" and did not apply the full test because there is no reference in [99] to the ordinary reasonable members of the class of people to whom the conduct was directed.

Consideration

1. We agree with Ms Petropoulos that, [T]he tendency of the conduct or representation to mislead or deceive is to be considered or tested against the ordinary or reasonable members of the class to whom the representation was made or the conduct directed": Australian Olympic Committee, Inc v Telstra Corporation Limited [2016] FCA 357 at [132]. But the Tribunal cannot be criticised for failing to expressly state every legal principle associated with the law of misleading or deceptive conduct. As the Tribunal observed at [95], there is "an enormous body of case law in relation to whether conduct is misleading or deceptive". The Tribunal stated, correctly at [96], that the test for misleading and deceptive conduct is an objective question of fact. It follows that the correct perspective is that of an ordinary reasonable consumer, not, for example, the perspective of either of the parties.
2. The Tribunal found at [99], that the representation about premium bathroom renovations was an opinion by the builder that he was capable of carrying out premium work. The Tribunal also found that the builder had reasonable grounds for making that representation. We understand, although it was not expressly stated, that the Tribunal was relying on the principle that a statement of opinion may not misinform or be likely to misinform, in particular if the opinion was honestly held on rational grounds: Pappas v Soulac Pty ltd (1983) 50 ALR 231; ASIC v Fortescue Metals Group Ltd (2011) 190 FCR 364; Bateman v Slatyer (1987) 71 ALR 553. The Tribunal's conclusion was that, in this case, the expression of an opinion about the capacity of the builder to carry out premium work does not amount to misleading or deceptive conduct.
3. Ms Petropoulos made the point that, "… the builder's explanation or standalone opinion is somewhat irrelevant, as the test is whether the representations would mislead, or would likely mislead, an ordinary and reasonable person from the relevant class of consumers". In making this submission, Ms Petropoulos appears to have misunderstood the Tribunal's reasoning at [99]. The Tribunal did not adopt the subjective opinion of the builder as to whether the representation has a tendency to mislead or deceive an ordinary reasonable consumer of bathroom renovations. Rather, the Tribunal held that the words "premium bathroom renovation" were the expression of an opinion honestly held on rational grounds. That was the basis for its conclusion. Ms Petropoulos did not challenge that finding except to say that it was 'somewhat irrelevant'.
4. Ms Petropoulos relied on the same grounds of appeal in relation to the other three representations. The Tribunal found in relation to the representations about the Director's experience, that Mr Morphett did have more than 21 years' experience in the building industry and is a fully licenced builder and carpenter. In relation to the representations about the tiler, the Tribunal found that the building company did not use Mr Groves as the tiler but that Mr Bodini was very experienced. The Tribunal was not satisfied that Ms Petropoulos was induced to enter into the contract because she thought that Mr Groves would be the tiler. Ms Petropoulos did not challenge these findings on any legal basis.
5. We repeat in relation to these representations that the Tribunal stated, correctly, that the test for misleading and deceptive conduct is an objective question of fact. It follows that the correct perspective is that of an ordinary reasonable consumer. We are not satisfied Ms Petropoulos has established any error of law in respect of the test applied by the Member in determining whether the representations were misleading or deceptive, or likely to mislead or deceive, prior to the execution of the contract.
6. In relation to the final representation, the Tribunal found that it was not necessary to determine whether the oral representations made by the builder after the contract was entered into were misleading or deceptive. Ms Petropoulos did not challenge that finding on appeal. After coming to that conclusion, the Tribunal stated that even if it was wrong, it has previously found that there has been no breach of the statutory warranty in s 18B(a). Ground of appeal 4(c)(iii) was that, in articulating this alternative reason for rejecting one part of the misleading and deceptive conduct claim, the Tribunal failed to distinguish between the technical defects and the quality of the work.
7. The Tribunal did not need to rely on the alternative basis for rejecting this part of the misleading and deceptive conduct claim. It follows that the reference to the breach of statutory warranty made no difference to the decision. When a finding, even if made in error, is not material, the Appeal Panel will decline to set aside the decision on that basis: Australian Broadcasting Commission v Bond (1990) 170 CLR 321 at 353.
8. Ground 4(c)(ii) was that the loss resulting from the misleading and deceptive conduct is the cost to have the bathroom re-tiled to achieve a quality or premium finish. As the Tribunal found that there had been no misleading or deceptive conduct, no remedy was ordered.
9. Ms Petropoulos referred the Appeal Panel to the transcript where the builder's expert concedes that the bathrooms are not 'quality'. As the Tribunal rejected the homeowner's claim for misleading or deceptive conduct on a different basis, that evidence was irrelevant and this ground of appeal is also dismissed.

Tribunal's findings and orders

1. Section 18B(1)(d) provides a statutory warranty that "the work will be done with due diligence and within the time stipulated in the contract, or if no time is stipulated, within a reasonable time". The Tribunal concluded at [114], that the delay in the contract being completed had been caused by the home owner's act or omissions". Alternatively, the Tribunal found at [116] that if that conclusion is wrong, the home owner had unreasonably refused access to the builder to complete the works and the home owner had failed to mitigate any loss that may have arisen by the builder not completing the works in time in accordance with the contract.

Grounds of appeal

1. At [60] to [102] of her submissions in chief, Ms Petropoulos sets out and comments on the evidence and findings relating to the delays in completing the work. At [103], she states that "the above history is set out to refute the claims that the homeowner denied the builder access to the site". As this ground of appeal relates to the Tribunal's decision that there had been no breach of s 18B(1)(d), we have considered it in that context.

Consideration

1. The Tribunal found, at [112] that, "[T]he builder cannot be said to have failed to remedy defective work when it is clear that the home owner has denied him reasonable access to do the work". At [113] the Tribunal made the following finding: The Tribunal is not satisfied that there has been a failure by the builder to remedy defective work or to proceed diligently with the work. The dispute has arisen due to the home owner's opinion of the work of the builder and the home owner not allowing the builder to access the site to carry out the rectification work and complete the building works.
2. The Tribunal repeated the finding that Ms Petropoulos unreasonably refused access to the builder to complete the works at [116]. The Tribunal summarised the evidence supporting those findings at [111]. In the building company's view, that evidence supports a finding that it was the homeowner who put a stop to the works.
3. We are unable to identify a question of law in relation to this ground of appeal. If Ms Petropoulos is requesting permission for this ground of appeal to go ahead, she would have to establish that she has suffered a substantial miscarriage of justice because, for example, the decision of the Tribunal under appeal was against the weight of evidence. The Tribunal set out the evidence and gave reasons for its findings. We are not persuaded that those findings were against the weight of the evidence.
4. Ms Petropoulos's final point was that there was no evidence to support the Tribunal's finding at [113], that she did not allow the builder to access the site to carry out rectification work and complete the building works. This was a new ground made for the first time in oral submissions on appeal. Making a finding of fact based on "no evidence" is an error of law. To establish an error of law Ms Petropoulos must demonstrate that there "is no evidence of a primary fact" and that this fact is "crucial to [the Tribunal's] decision": Azzopardi v Tasman UEB Industries Ltd (1985) 4 NSWLR 139, Kirby P at 151.
5. The evidence that Ms Petropoulos did not allow the builder to access the site to carry out rectification work can be found in the Appellant's Bundle at pp 314, 326, 329, 361, 363, 367-369. There was evidence to support the Tribunal's finding.
6. Grounds 4(d)(ii) and (iii) relate to the Tribunal's findings about mitigation of loss. As this finding was made in the alternative, and no challenge has been made to the primary finding that the delay in the contract being completed has been caused by the homeowners act or omissions, this ground of appeal is dismissed.

Tribunal's findings and reasoning

1. The Tribunal found at [116] that the contract was validly terminated by the builder on 22 February 2016 by relying on the repudiation of the home owner. That finding was significant when determining the builder's claim and the Tribunal's order that the homeowner pay the builder $952.20 in loss of bargain damages.

Grounds of appeal

1. At [104] to [119] of her submissions in chief, Ms Petropoulos sets out the history of the communications with the building company and makes a series of assertions in support of her argument that it was the building company who repudiated the contract. The "repudiation" ground of appeal is that the evidence supports a finding that she was fully justified in terminating the contract because the builder had repudiated the contract by failing to rectify and complete the works.

Consideration

1. We are unable to identify a question of law in relation to this ground of appeal. If Ms Petropoulos is requesting permission for this ground of appeal to go ahead, she would have to establish that she has suffered a substantial miscarriage of justice because, for example, the decision of the Tribunal under appeal was against the weight of evidence. The Tribunal set out the evidence and gave reasons for its findings. We are not persuaded that those findings were against the weight of the evidence.

Costs

1. The parties agreed that rule 38 of the Civil and Administrative Tribunal Rules 2014 (NSW) applies. This rule states as follows: (1) This rule applies to proceedings for the exercise of functions of the Tribunal that are allocated to the Consumer and Commercial Division of the Tribunal. (2) Despite section 60 of the Act, the Tribunal may award costs in proceedings to which this rule applies even in the absence of special circumstances warranting such an award if: (a) the amount claimed or in dispute in the proceedings is more than $10,000 but not more than $ 30,000 and the Tribunal has made an order under clause 10(2) of Schedule 4 to the Act in relation to the proceedings, or (b) the amount claimed or in dispute in the proceedings is more than $ 30,000
2. The parties agreed that the claim was over $30,000 so whoever was successful on appeal should be entitled to an award of costs. As the appeal has been upheld in part, we direct the parties to provide further short submissions on the orders we should make in relation to the costs of the appeal. Those submissions should be made on the same dates as the dates set out in [32] above.

Orders

1. Leave is refused for Ms Petropoulos to appeal on grounds other than a question of law.
2. The appeal is upheld in part.
3. The Tribunal's decision that CPD Holdings Pty Ltd did not breach any of the statutory warranties in the Home Building Act 1989 (NSW) in relation to the size of the shower screen is set aside.
4. In substitution for that decision, a decision is made that CPD Holdings Pty Ltd breached the statutory warranty in s 18B(1)(a) of the Home Building Act 1989 (NSW) in relation to the size of the shower screen.
5. Parties are to provide further written submissions on the appropriate remedies, if any, in relation to that breach, in accordance with the directions given at [32] of these reasons.
6. The appeal is otherwise dismissed.
7. Each party is to provide further submissions in relation to the costs of the appeal by the same dates as are specified in [32].

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: 27 March 2018