Prestige Auto Centre Pty Ltd v Apurva Mishra

NCAT Appeal Panel|2014-10-10

reasons for decision 1Prestige Auto Centre Pty Ltd (the appellant) has appealed against an order made in the Consumer and Commercial Division of the Tribunal under the Consumer Claims Act 1998 that it pay the respondent, Apurva Mishra, the sum of $18,526.00. 2The Tribunal found that the appellant had engaged in misleading and deceptive conduct when it sold the respondent a used vehicle imported from Japan, with the odometer wound back from 101,600 kilometres to 33,248 kilometres. The Tribunal was satisfied that appellant was aware of the fact that the odometer had been wound back. The damages of $18,526 awarded by the Tribunal, consisted of the difference in value of the vehicle "per Sinergy valuation" as a result of the misdescription in kilometres, together with the costs of various repairs that the Tribunal accepted were "directly attributable to 80,000 additional kilometres travelled." 3The appeal is an internal appeal to which Division 2 of Part 6 of the Civil and Administrative Tribunal Act 2013 (the CAT Act) applies. Section 80 of the CAT Act is concerned with internal appeals. It provides - (1) An appeal against an internally appealable decision may be made to an Appeal Panel by a party to the proceedings in which the decision is made. Note. Internal appeals are required to be heard by the Tribunal constituted as an Appeal Panel. See section 27 (1). (2) 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. (3) The Appeal Panel may: (a) decide to deal with the internal appeal by way of a new hearing if it considers that the grounds for the appeal warrant a new hearing, and (b) permit such fresh evidence, or evidence in addition to or in substitution for the evidence received by the Tribunal at first instance, to be given in the new hearing as it considers appropriate in the circumstances. 4With respect to appeals from the Consumer and Commercial Division of the Tribunal Clause 12 of Schedule 4 of the CAT Act provides - (1) 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). Note. Under section 80 of this Act, a party to proceedings in which a Division decision that is an internally appealable decision is made may appeal against the decision on a question of law as of right. The leave of the Appeal Panel is required for an internal appeal on any other grounds. (2) Despite section 80 (2) (b) of this Act, an internal appeal against a Division decision may only be made on a question of law (as of right) and not on any other grounds (even with leave) if: (a) the appellant is a corporation and the appeal relates to a dispute in respect of which the Tribunal at first instance had jurisdiction because of the operation of Schedule 3 to the Credit (Commonwealth Powers) Act 2010, or (b) the appeal is an appeal against an order of the Tribunal for the termination of a tenancy under the Residential Tenancies Act 2010 and a warrant of possession has been executed in relation to that order. 5The appellant relied on a number of alleged errors of law and sought the Appeal Panel's leave to rely on other grounds, including leave to rely on significant new evidence that had arisen since the Tribunal hearing. Due to the conclusions we have reached with respect to the appeal, it is convenient to first consider the application for leave to rely on significant new evidence.

The leave application 6Both parties sought to rely on new or further evidence at the appeal hearing. The appellant had served a bundle of such evidence on the respondent on the day the appeal was heard. The respondent said that he had received those documents and that he was able and willing to proceed. 7The vast majority of the new documentary evidence relied on by both parties can be characterised as further evidence obtained since the Tribunal hearing, designed to bolster their respective positions. When the Appeal Panel drew the parties attention to the requirement that any significant new evidence they sought to rely on be evidence "not reasonably available at the time the proceedings under appeal were being dealt with," both acknowledged and accepted that much of the new evidence they sought to rely on did not meet that criteria. As a result they did not press much of the new evidence they had initially sought to rely on. 8The appellant did seek to rely on the following documents as constituting significant new evidence that was not reasonably available to it at the time of the hearing:

A used car appraisal from Rob Redic of Sinergy Motor Sports of Memindie Gardens, S.A, dated 25 February 2014, addressed to the respondent with respect to the vehicle in issue.
A print out of an email purportedly from Rob Redic of Sinergy Motor Sports to Mr Akhmentov dated 2 October 2014. These documents need to be put in context in order to understand their relevance. 9At the Tribunal hearing the respondent relied on two documents in an effort to establish his loss as a result of buying a Mitsubishi Lancer Evolution VIII MR with 33,248 kilometres on the odometer, when he alleged it had actually done101, 600 kilometres or more. The first was a print out from RedBook.com.au which showed a trade in price guide for the vehicle of $16,100 - $19,400, and a private price guide of $20.400 - $23,700. The average kilometres for such a vehicle were shown as 150,000 - 250,000. 10The second document, which was accepted by the Tribunal in assessing the respondent's damages, was a used car appraisal from Rob Redic of Sinergy Motor Sports of Memindie Gardens, SA, dated 25 February 2014, addressed to the respondent with respect to the vehicle (the Sinergy valuation). Omitting the formal parts it read: VEHICLE VALUATION USED CAR APPRAISAL MAKE: MISUBISHI MODEL: LANCE EVOLUTION 8 MR YEAR 2004 KMS: 120,000KMS APPROX (SHOWING 42,918 KMS) REG No .... VIN No ... DESCRIPTION: STANDARD CONDITION, AFTER MARKET FRONT BAR, NO DAMAGE TO BODY AND INTERIOR. SIGNS OF CORROSION EVIDENT (SNOW VEHICE), CUSTOMER ADVISED ABOUT ORIGINAL CONDITION.

VALUE: IN THE CURRENT CONDITION OF THIS VEHICLE OUR OPINION OF THE VALUE OF THE VEHICLE IS WHOLESALE $20,000

11The email from Mr Redic dated 2 October 2014 on which the appellant sought to rely referred to that Sinergy Valuation and said- The document ...is a[n] altered document to the one given in February 2014. Original document supplied. 12That original Sinergy valuation is the same as that the respondent relied on before the Tribunal (the original Sinergy valuation), with the exception of those parts of it that are concerned with the description and value of the vehicle. Those parts of the original read: DESCRIPTION: STANDARD CONDITION, AFTER MARKET FRONT BAR, NO DAMAGE TO BODY AND INTERIOR. SIGNS OF CORROSION EVIDENT (SNOW VEHICE).

VALUE: IN OUR OPINION OF THE VALUE OF THE VEHICLE IS WHOLESALE $20,000. RETAIL $24,000 (private) $26,000 (dealer)

13The appellant alleged that the respondent had deliberately altered the original Sinergy Valuation and had thereby misled the Tribunal. 14The respondent admitted altering the original Sinergy valuation. The following exchange took place between Senior Member Molony and him. Molony Mr Apurva, I just want to make sure that I understand what you just said. I don't want there to be any confusion about this. Apurva Mishra No Molony So you're saying that if we compare the document that Mr Akhmentov referred us to today, you have added to that the words "in the current condition of the vehicle," and also deleted from it the words "retail 24,000 private" and you have deleted from it the words "$26,000 dealer." Apurva Mishra Yes I did. Molony OK. And did you alert or say anything to the Tribunal member to make her aware that you had altered the document, That it was an altered document rather than an original document? Apurva Mishra Oh yes, I am getting to that point as well. ...

15The respondent went on to explain that in seeking to recover damages from the respondent he had sought to obtain the difference between the price he paid for it and the true wholesale value of the vehicle due to the odometer being wound back. He agreed that he had altered the original Sinergy valuation before producing it to the Tribunal, having been given it in electronic form, in order to achieve that object. He had also sought to recover the costs of restoring the vehicle to the condition it would have been in had it actually done approximately 33,248 kilometres. 16The effect of the alterations was to exaggerate the gap between the price paid for the vehicle and its true value. 17The new evidence which the appellant relied on to demonstrate that the respondent had altered the Sinergy valuation is not evidence that one could reasonably expect a party to Tribunal proceedings to obtain before a hearing. There is nothing about the first Sinergy valuation that would alert one to the fact that it had been altered and was not an original document. As a consequence there was nothing about the Sinergy valuation that pointed to the need for further enquiries to be made as its veracity. In those circumstances we are satisfied that the new evidence relied on by the appellant was not reasonably available to it at the time of the Tribunal hearing. 18That evidence, together with the respondent's admission that he deliberately altered the original Sinergy valuation, demonstrate that the respondent actively sought to and did mislead the Tribunal as to the true content of that document, in order to advantage his case. It demonstrates that the order made by the Tribunal was obtained as a result of fraud perpetrated on the Tribunal by the respondent. That evidence is significant new evidence that demonstrates that the appellant may have suffered a substantial miscarriage of justice as a result of the respondent deliberately misleading the Tribunal as to the content of the original Sinergy valuation. 19As a consequence the Panel grants leave to the appellant to appeal on the ground that he may have suffered a significant injustice because significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with). 20In Hip Foong Hong v H Neotia & Co [1918] A.C. 888 the Privy Council (Earl Loreburn, Lord Buckmaster and Lord Dunedin) explained at 894 that: .A judgment that is tainted and affected by fraudulent conduct is tainted throughout, and the whole must fail; ... 21In Clone Pty Ltd v Players Pty Ltd (in liq recs apptd) [2012] SASC 12 Kourakis J at [97] explained why cases of fraud constitute an exception to the general public interest in the finality of litigation - ..., fraud is viewed differently. The public interest in finality necessarily entails tolerance of some judgments which events subsequently show to have been mistaken, but there is little or no public interest in allowing a litigant who has cheated justice to retain the fruits of his or her fraud. To do so would tend to bring the administration of justice into disrepute because it would lend the assistance of the compulsory processes of the courts to the litigant who was the most effective fraudster. If evidence of material fraud is discovered within the period in which an appeal can be brought, or even after that period has expired but before the Full Court has determined an appeal from the trial judgement, the Full Court can consider and pass judgment on the allegation of fraud. However if the fraud practised at trial is discovered after an appeal on other grounds has been dismissed, there is no remedy unless the court at first instance retains the power once exercised in Chancery on an Original Bill alleging fraud. For that reason, the existence of a power in the trial court to set aside a judgment obtained by fraud has consistently been recognised in common law jurisdictions since the Judicature Acts. 22In Meek v Fleming [1961] 3 All ER 148 Holroyd Pearce LJ explained at 154: Where a party deliberately misleads the court in a material matter, and that deception has probably tipped the scale in his favour (or even, as I think, where it may reasonably have done so) it would be wrong to allow him to retain the judgment thus unfairly procured. Finis litium is a desirable object, but it must not be sought by so great a sacrifice of justice which is and must remain the supreme object. Moreover, to allow the victor to keep the spoils so unworthily obtained would be an encouragement to such behaviour, and do even greater harm than the multiplication of trials. In every case it must be a question of degree, weighing one principle against the other 23Indeed the Courts recognise that fresh evidence demonstrating that a decision was obtained as a result of fraud constitutes an exception to usual rule that applies to the fresh evidence ground of appeal. That requires that the fresh evidence was not known at the time of the trial, despite the exercise of reasonable diligence: see Hansen Yuncken Pty Ltd v Erickson t/as Flea's Concreting [2011] QSC 327 at [127], [128] per McMurdo J; Commonwealth Bank of Australia v Quade (1991) 178 CLR 134. This is not the case with respect to appeals from the Consumer and Commercial Division of the Tribunal because Clause 12 of Schedule 4 of the CAT Act requires that the significant new evidence not be reasonably available at the time of the hearing. 24A conclusion that a judgment has been obtained by fraud constitutes a ground for setting aside that judgment and ordering a new trial: McDonald v McDonald (1965) 113 CLR 529 at 533 per Barwick CJ, at 540 per Menzies J. 25These principles are equally applicable to decisions obtained as a result of fraud perpetrated on the Tribunal. 26In the Panel's opinion the respondent relied on the Sinergy valuation during the hearing before the Tribunal. He benefited from his reliance on that altered document in the orders made at the conclusion of those proceedings. As a consequence the appropriate order is to set aside the decision of the Tribunal and order a new hearing of the application.

Other matters 27Because we have determined that the significant new evidence merits a new hearing there is no point to be served by traversing all the errors of law alleged by the appellant. Two of those alleged errors, however, merit our attention for the guidance of the parties. They concern - (1)Whether there was evidence before the Tribunal which justified the conclusion that the vehicle at the time of import had travelled 101,600. (2)Whether the Tribunal erred in assessing the measure of damages for misleading and deceptive conduct.

The odometer reading at the time of import 28At paragraph 14 of its reasons for decision the Tribunal wrote - The applicant obtained the original "Japanese Registration Certificate" that confirmed the correct odometer reading at the time of import to Australia was 101600. 29At the hearing the respondent produced: (1)A document in Japanese that he said was a certified Japanese registration certificate for the vehicle dated 21 March 2012 showing the latest odometer reading for the vehicle as being 101,600. This document bore the numerals 01748 in its top left hand corner. (2)A document that the respondent said was an English translation of the Japanese registration certificate. There was no indication on the document of who had translated it, and no evidence tendered that the translation was true and accurate. This document bore "Number 00825" in its top left hand corner. Other numerals recorded ion the certificate mirrored the Arabic numerals contained in the Japanese documents. 30On appeal the appellant pointed to the different numbers on these documents, and the absence of certification of the correctness of the translation, to question their veracity and to dispute their evidentiary value. 31It is important to recognise that the Tribunal is not bound by the rules of evidence (s 38(2) of the CAT Act) and is to act with as little formality as the circumstances of the case permit, and according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms (s 38(4)). In interpreting the CAT Act and exercising its powers under that Act, the Tribunal is required to give effect to the guiding principle established in s 36 that, "the Tribunal, is to facilitate the just, quick and cheap resolution of the real issues in the proceedings." 32The usual method by which the content of foreign language documents are proved is by production of a certified translation or other evidence, which shows the identity of the translator and certifies the accuracy of the translation. In some cases the translation is proved by an affidavit from the translator. This is necessary because, without a translation, the content of the foreign language document is bereft of meaning. The certification requirements are driven by the need to ensure that translations of foreign documents that are used in evidence are accurate representations of the originals. Certified translations are however costly and at times difficult to obtain. 33Where, as was the case here, the translation is being used to establish proof on the balance of probabilities of serious misconduct ( i.e. that the odometer was wound back) the Tribunal in considering whether to accept an uncertified translation should bear in mind the caution sounded by the High Court in Briginshaw v. Briginshaw (1938) 60 CLR 336 at 362, per Dixon J,-that - The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction. With respect to documentary evidence this warning merits more force now than when it was made, because of the relative ease with which documents in digital form can now be manipulated. These factors point to the need for caution to be exercised by a Tribunal before accepting an uncertified translation of a foreign document. 34In the present case, however, it is clear that the Tribunal had before it and accepted as genuine the uncertified translation of the Japanese registration certificate. It did so in circumstances where it was the Tribunal's understanding that the appellant was not disputing that the vehicle had done 101,600km at the time of import. While Mr Akhmentov disputes that he made such a concession, we have listened to the tape of the proceedings and what he said is capable of being understood as a concession. 35In order for the appellant to succeed on the ground that there was no evidence that justified the conclusion that the vehicle had done 101,600 kms at the time of import, the appellant must establish an "absence of material, whether strictly admissible according to the rules of evidence or not," that justified the Tribunal's conclusion: see Smith & v Collings Homes Pty Ltd & Anor [2004] NSWCA 75 per Mason P at [32]. (Handley JA and Campbell J agreeing), and South Western Sydney Area Health Service v Edmonds [2007] NSWCA 16 at [129] per McColl J. That is not the case here. There was material before the Tribunal upon which its conclusion that the odometer reading on the vehicle at the time of import was 101,600 was based. Importantly, that conclusion was not in issue. 36However, on a rehearing and assuming the appellant withdraws the concession the uncertified translation may not constitute persuasive evidence.

The measure of damages for misleading and deceptive conduct 37The Tribunal found that the appellant had engaged in misleading and deceptive conduct contrary to s 18 of the Australian Consumer Law (NSW). Damages were assessed at $18,526 being the difference in value of the vehicle "per Sinergy valuation" as a result of the mileage discrepancy of $10,000, together with the costs of various repairs that the Tribunal accepted were "directly attributable to 80,000 additional kilometres travelled." 38The usual measure of damages for conduct in breach of s 18 of the Australian Consumer Law (NSW) is analogous to that found in tort for deceit, although it is not confined to that in tort, and may extend to remedies available in contract or to equitable remedies: Gough and Gilmour Holdings Pty Ltd (No 2) v Peter Campbell Earthmoving Pty Ltd [2007] NSWSC 172 and Abigroup Contracting v Sydney Catchment Authority (No 3) [2006] NSWCA 282 39In the present case the Tribunal calculated at $10,000 the difference between what the respondent paid for the vehicle and its true value at the time of the valuation. In addition, however, the Tribunal awarded the respondent the cost of restoring the vehicle to the condition it would have been it had it only done the 33,248 kms. This was the odometer reading attributed to it on the warranty under the Motor Dealers Act 1974, which is to be contrasted with the 101,600 kms which the Tribunal found the vehicle had done. That cost, we note, is disputed by the appellant. 40While the cost of restoring the vehicle is a measure of damages that arguably could be adopted, the weight of authority points to the more usual measure of damages being the difference in value. In P E Kafka Pty Ltd v Hermitage Motel Pty Ltd [2009] FCAFC 94 the Full Court of the Federal Court (Ryan, Gordon and Foster JJ) said - 15 If a person is induced by misrepresentation to buy an article, the purchaser is entitled only to recover the difference between the value as represented and the real value at the time the article was bought: HTW Valuers (Central Qld) [2004] HCA 54; 217 CLR 640 at [35] and Potts v Miller [1940] HCA 43; 64 CLR 282 at 298. If the article subsequently becomes destroyed or damaged while in the possession of the purchaser, the damage recoverable does not change. The purchaser cannot add to the claim for damage any deterioration in value of the article brought about by some supervening cause. Consistent with that "rule", if the subsequent deterioration in the article is attributable to a defect inherent in the article itself, then that inherent defect is reflected in the real value of the item at the time of acquisition: HTW Valuers (Central Qld) [2004] HCA 54; 217 CLR 640 at [40] and Potts v Miller [1940] HCA 43; 64 CLR 282 at 298. 16 However, those "rules" are not inflexible, universal or rigid: HTW Valuers (Central Qld) [2004] HCA 54; 217 CLR 640 at [35]. First, the loss is the difference between the price paid and the "real value," not the market value: HTW Valuers (Central Qld) [2004] HCA 54; 217 CLR 640 at [36] and [37] and the authorities cited. Secondly, in the assessment of compensation in some circumstances, subsequent events may be taken into account for no other reason than that it is the duty of an arbitrator or tribunal in determining compensation to have regard to facts instead of conjecture: HTW Valuers (Central Qld) [2004] HCA 54; 217 CLR 640 at [39] and the authorities cited. In other words, if an event about which a guess or estimate would otherwise have to be made has in fact occurred, the arbitrator or tribunal should not guess or estimate but should set out the established fact. 17 Of course, the burden lies on the claimant to prove that the article acquired was, at the time of purchase, of less value than the amount paid: Potts v Miller [1940] HCA 43; 64 CLR 282 at 299. If a claimant cannot discharge that burden, the action fails. 41In our view the preferred measure of damages in the present case is the difference in value between the amount the respondent paid for the vehicle and its true value at the time of sale, rather than some later time. Such a valuation was not before the Tribunal. The Tribunal did however find a "Difference in value per Sinergy valuation - $10,000." 42The Tribunal also assessed the costs of restoring the vehicle to the condition it would have been in had it only done 33,248 kms ($8,526). 43By awarding $18,526 the Tribunal compensated the respondent for the detriment he suffered as a consequence the appellant's misleading and deceptive conduct using a value enhanced by the costs of restoration or repairs undertaken. 44This award potentially compensated the respondent twice for the same detriment. It is difficult to discern the Tribunal's reasons for making this award, which are summarised in paragraph 36 of the decision. There it appears as if the finding was that $10,000 was the difference in the price paid and the actual value of the vehicle. If so, the claim for repairs constitutes double compensation. 45If the $10,000 represents the difference between the price paid and the actual value when the vehicle was valued (which was after the repairs had been undertaken) then, insofar as the Tribunal considered the cost of rectification to represent part of the difference between the price pad and the real value at the time of sale, there may not be an element of double compensation. The Tribunal's precise intentions are not clear. 46In light of the difficulties in understanding the process of reasoning by which damages were assessed, and the questions regarding double compensation, the appeal panel is of the view that the Tribunal made an error of law.

Conclusion 47In the light all of the above the Appeal Panel makes the following orders - (1)Leave to appeal is granted. (2)Appeal allowed. (3)The decision under review is set aside. (4)There shall be a new hearing of the application, before a differently constituted Tribunal, with both parties having the opportunity to adduce fresh or additional evidence. I hereby certify that this is a true and accurate record of the reasons for decision of the New South Wales Civil and Administrative Tribunal. Principal Registrar

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: 11 November 2014

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