Redmyre Group Pty Ltd v Stockman

NCAT Appeal Panel|2023-11-06|Before: Blake AM, Cosmarnan Constructions P, Jpqs P

S Robertson and J Nathan (Appellant) T Lynch SC and A Sivanathan (Respondents)

Solicitors: Effective Legal Solutions (Appellant) HWL Ebsworth Lawyers (Respondents) File Number(s): 2023/00280808 Publication restriction: Nil Decision under appeal Court or tribunal: Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Date of Decision: 26 May 2023 Before: D Goldstein, Senior Member File Number(s): HB 20/26413

Overview

This is an internal appeal from two decisions of the Consumer and Commercial Division of the Tribunal, the first made on 26 May 2023 and the second made on 22 June 2023, in proceedings under the Home Building Act 1989 (NSW) (HB Act) concerning a dispute between the respondents, Andrew Stockman and Hieu-Duc Stockman (Mr and Mrs Stockman) who are the owners of a property at Earlwood in New South Wales (the property), and the appellant, Redmyre Group Pty Ltd (Redmyre), which is the builder that agreed to carry out building work at the property. In the first decision, the Tribunal made a work order in favour of Mr and Mrs Stockman. In the second decision, the Tribunal made a costs order partly in favour of Mr and Mrs Stockman and partly in favour of Redmyre.
The notice of appeal of Redmyre was filed out of time.
The initial issue for determination was whether an extension of time to appeal should be granted.
We have decided that the application of Redmyre to extend the time to file the notice of appeal should be dismissed, the appeal should otherwise be dismissed, and there should be no order as to the costs of the appeal. The principal reasons for this decision are that we are not satisfied that Redmyre has provided a satisfactory explanation for the delay in filing the notice of appeal and that Redmyre's appeal has more substantial merit than merely being fairly arguable.

The factual background

On 26 January 2015, Mr and Mrs Stockman as the owners and Redmyre as the contractor entered into a contract for the construction of an addition to the building on the property for the price of $296,255.00 including GST which excluded work to the existing ground-floor sub-floor area (the building contract).
Disputes arose between the parties as to alleged defective building works.

The history of the Tribunal proceedings

On 16 June 2020, Mr and Mrs Stockman as the applicants commenced proceedings HB 20/26413 in the Consumer and Commercial Division of the Tribunal against Michael Gouros (Mr Gouros), the director of Redmyre, as the respondent by filing a home building application in which they claimed a work order to the approximate value of $157,750.00 and a money order of $21,765.00 for a breach of statutory warranty (the Tribunal proceedings).
On 8 October 2020, the Tribunal relevantly made an order removing Mr Gouros as the respondent and joining Redmyre as the respondent.
On 27 October 2021, the Tribunal dismissed the application of Mr and Mrs Stockman to transfer the proceedings to the District Court of New South Wales and ordered Mr and Mrs Stockman to pay Redmyre's costs of the application.
On 14, 15 and 16 June 2022, the hearing took place. At the conclusion of the hearing, the Tribunal made procedural orders in relation to submissions by the parties.
On 15 February 2023, the Tribunal made procedural orders in relation to a work order and costs (the 15 February 2023 orders), and published reasons for its decision (the 15 February 2023 decision).
On 18 May 2023, the Tribunal made procedural orders in relation to a work order (the 18 May 2023 orders), and published reasons for its decision.
On 26 May 2023, the Tribunal relevantly made the following orders (the 26 May 2023 orders), and published reasons for its decision (the 26 May 2023 decision) which were sent on that day to the parties' legal representatives by email: "1. The Respondent is ordered to complete the work detailed in Annexure A: 1. on or before 21 July 2023; and 2. in accordance with the terms and conditions set out in Annexure B. 2. The applicants have leave to renew these proceedings if order 1 is not complied with within the period specified. …"
On 22 June 2023, the Tribunal relevantly made the following orders in relation to the costs of the proceedings (the 22 June 2023 orders), and published reasons for its decision (the 22 June 2023 decision) which were sent on that day to the parties' legal representatives by email: "… (2) Except in connection with Andrew Stockman & Hieu Stockman's loss of rental claim and the costs of and incidental to the preparation, filing and service of the affidavit of Mr Andrew Stockman in these proceedings, Redmyre Group Pty Ltd must pay Andrew Stockman & Hieu Stockman's costs of the proceedings on the ordinary basis, such costs if not agreed to be assessed in accordance with the Legal Profession Uniform Law Application Act 2014. This order does not supersede or vacate the order for costs made in favour of Redmyre Group Pty Ltd on 27 October 2021. …"

The 15 February 2023 decision

In the 15 February 2023 decision, the Tribunal: 1. set out the nature of the proceedings and details of the building contract, the issues and the hearing, and the submissions and evidence of the parties (at [1]-[15]); 2. set out the reasons for making a work order rather than a money order (at [16]-[22]); 3. dealt with the issue with respect to the ground-floor sub-floor area (at [23]-[43]): "The ground floor sub- floor issue 23 A substantial dispute in these proceedings concerns the ground-floor sub-floor area. There is no controversy that: (1) the ground floor sub-floor space was opened up. That is the existing floorboards were removed by the owners; (2) the ground floor sub-floor space was excavated by the owners; (3) new bearers and joists were laid in this area; (4) Particle flooring was laid over the new bearers and joists; and (5) The completed work is defective in that there is excessive moisture in the ground floor sub-floor area. 24 The controversy is whether or not the builder was responsible for carrying out this work. The owners say that it was. The builder states that it was not, because the owners entered into a direct contact with its carpenter for him it to carry out the work. Findings of material facts 25 I find based on Mr Gouros' evidence that that he was of the view that he could not price the sub floor work on the ground floor until the floor boards were removed. Once that was done, it was his intention to provide a quote to the owners for the sub-floor work as a variation. Mrs Stockman held an identical understanding about this. Refer [52] page 271, exhibit A. In any event the contract provided for this. Refer to Attachment 1 to the contract as referred to at [9] of these Reasons. 26 Demolition work commenced on or about 2 February 2015 and was carried out under a contract between the demolition contractor and the builder. In this regard the demolition plan which was a contract document did not require the demolition of floors. The builder's evidence refers to the precise scope of the demolition work. I accept his evidence because he has first-hand knowledge of what occurred so far as the demolition was concerned. 27 Mrs Stockman provided two statutory declarations in these proceedings. The first was dated 10 February 2021 which is in exhibit A. The second is dated 2 August 2020 which is in exhibit B. In her 10 February 2021 declaration Mrs Stockman commencing at [66] refers to a series of events and interactions with the builder and an email from the builder dated 25 March 2015 in which the builder confirms verbal instructions received from the owners in connection with a number of matters. Relevant to the ground floor sub-floor issue, the builder requested a confirmation of the owners: 'verbal instruction directing our carpenter to supply and install timber floor frame from front to kitchen area on ground floor, rest of floor (dining/lounge area) to be concrete with allowance in height for future installation of Floorboards on battens.' 28 Mrs Stockman stated that her recollection was that the email referred to a discussion held on site in late February or early March 2015 when the builder raised concerns about discrepancies between the street level and sub floor levels. According to Mrs Stockman the outcome of these meetings was that following a discussion of various issues regarding subfloor levels there was a proposal from the builder to concrete the back of the owners' property and to use timber bearers and joists at the front of the property. Mrs Stockman also stated that on 5 March 2015 she or her husband instructed the builder that the concrete could be poured at the rear of the property and that for the rest of the 'house' - ground floor - 'brick piers with timber' should be used. Her evidence was also that the owners arranged through their family that they would 'rip up as much of the flooring possible' and excavate the sub floor area. She stated that work was carried out on 7 and 8 March, presumably to remove flooring and to excavate sub-floor areas. Mrs Stockman's evidence goes to additional work the following weekend by the owners and their family in removing floor boards and excavating the sub floor levels. She also stated that the builder asked for $11,500.00 for brick piers and timber and that she instructed the builder to commence with the work for that amount being brick piers and timber in the front and paid the builder $11,500.00 in cash on 23 March 2015. 29 Mrs Stockman's evidence is that she did not respond to the builder's email 25 March 2015 because the timber floor frame to the ground floor was already being constructed. 30 The builder filed an affidavit affirmed on 8 July 2021 which among other things responded to Mrs Stockman's statutory declaration dated 10 February 2021. The builder states that he disagrees with Mrs Stockman's account of the conversation that she refers to at [66] of her statutory declaration. He states that what she refers to is a combination of various conversations. He refers to a conversation that occurred in February between himself, Mrs Stockman and his carpenter, Mr Tarabay. He states that the issue that was identified essentially related to the depth of the cavity under the timber floor. level. First, that the depth of the cavity did not allow for adequate ventilation. Secondly, that the floor was too close to ground level to comply with Building Codes. The builder states that after discussion the solution was said to be raising the floor, excavating under the floor, raising the ceilings and placing mechanical ventilation under the floor. 31 The builder denies that the conversation adverted to in [67] of Mrs Stockman's statutory declaration occurred. He states that on 7 and 8 March 2014 he saw that the owners and their family had begun to demolish the existing ground floor frame and that the demolished timber was left in the front yard and subsequently moved. The builder also states that on 14 March 2015 the owners asked him how much it would cost to do a new floor downstairs and that he responded that the 'price for the sub-floor from the kitchen to the front door, bedroom 2, bathroom and second entry way and hallway would be approximately $15,000.00'. He states that the owners replied that the price was too high and that he responded that they should get their own contractor or engage his contractor direct so long as they did things quickly. He said that the owners responded that they would get other prices. 32 The builder also denies accepting $11,500.00 in cash as alleged by the owners and states that he believes that his carpenter, Mr Tarabay organised for the timber framing for the sub-floor to be undertaken on the weekend of 27 - 29 March 2015. 33 In reply, in exhibit B, Mrs Stockman's evidence differs in some degree to that contained in her first statutory declaration, no doubt prompted by the builder's affidavit. 34 Mrs Stockman's evidence is that when Mr Gouros verbally offered to carry out the sub-floor work for $15,000.00, she stated that the price was too high and asked Mr Gouros if that was the best he could do. She states Mr Gouros replied as follows: 'If you're going to remove the rest of the flooring and excavate the subfloor, this would reduce the cost of manual labour if I have to get my guys to dig. We cannot get a bulldozer to access the area from the back or front streets because it is too narrow. The best I can do with your help and a cash payment is $11,500.' 35 Mrs Stockman's evidence is that she and her husband accepted the builder's offer and paid it $11,500.00 in cash on 23 March 2015, which the builder denies. At page 1824D of exhibit B there is a bank statement in the names of the owners which shows a cash withdrawal of $11,500.00 by them on 18 March 2015. 36 The builder's evidence in an affidavit which is exhibit C and which was affirmed on 13 June 2022, the day before the hearing and which annexes diary pages is that on 14 March 2015 he quoted the owners $15,000.00 to carry out the first floor subfloor work. The builder also annexes a diary page for 23 March 2015 which indicates that there was no one on site on that day. The builder states that this entry establishes that he was not on site and could not have received cash as alleged by the owners. A diary page for 27 March was also annexed which indicated a delivery of flooring for the ground floor. 37 I have serious doubts about the diary page for 23 March 2015. If the builder did not attend site, I fail to find it credible that he would be in any position to know who was on site. There may have been a number of persons on site unknown to him. If the builder himself did not attend the site as he asserts, the diary entry 'no one on site' is not accurate and does not give me a high level of confidence that the diary extract should be given any weight. 38 Mrs Stockman's statutory declaration of 10 February 2021 provided the owners evidence of the meeting on 23 March 2015 when it was alleged that the cash was handed by the owners to the builder. There was ample time for the builder to respond to that evidence, rather than leave it to the day before the hearing. 39 Mr G Taraby gave evidence at the hearing. He was engaged as a carpenter by the builder for the purposes of it constructing the work it contracted to carry out for the owners. The builder alleges that the owners contracted direct with Mr Taraby for him to carry out the ground floor sub-floor framing work. The owners allege that they paid the builder $11,500.00 in cash for it to carry out the sub-floor framing work and the builder engaged Mr Tarabay to carry out that work. Mr Tarabay in his evidence before the Tribunal said that he was engaged by the builder to carry out the ground floor sub-floor framing work and that he did carry out that work and was paid for it by the builder. Mr Tarabay gave evidence that he was never asked by the owners to carry out the sub-floor framing work and that he never received any payment direct from the owners 40 Mr Tarabay was rigorously cross examined by counsel for the builder. I formed the impression that Mr Tarabay was a direct, honest and reliable witness who was confident and clear in his evidence to the Tribunal. He was adamant that he did not contract with the owners direct or take money from them. 41 The position is that the owners state that they paid the builder $11,500.00 for it to install a new sub floor in the areas of the ground floor where a concrete slab would not be poured. The builder states that is not what occurred and the owners engaged his carpenter to do the work. The carpenter states that is not correct and that he did not contract with the owners. 42 Mrs Stockman was cross examined on this issue and adamantly denied that she contracted with the carpenter and repeatedly stated that she and her husband paid the builder $11,500.00 in cash. Mr Gouros was equally adamant that he did not agree to carry out the sub floor works and that he did not accept $11,500.00 in cash from the owners. Mr Gouros agreed that his carpenter laid bearers and joists on the ground floor, but stated that such work was not done on his instructions. 43 I accept Mrs Stockman's evidence that the owners contracted with the builder to carry out the ground floor sub floor work. An important part of accepting her evidence is that it is confirmed by Mr Tarabay's evidence, whose evidence I find to be reliable, that he carried out the ground floor sub-floor framing work for the builder and was paid by the builder. I also find that the owners paid the builder the sum of $11,500.00 in cash for this work which was a variation to the contractual scope of work. The bank statement which is at page 1824D of exhibit B is confirmatory of the owners' evidence and evidence which I attach weight to. I also find that the builder's diary page of 23 March 2015 is not of sufficient weight to base a finding that the owners did not pay the builder the cash payment of $11,500.00. The affidavit which annexed that diary page was produced at the last minute when the owners evidence of the cash payment had been filed and served many months before." 1. made findings in relation to the sub-floor defects and major defects (at [44]-[244]); 2. set out the process for making the work order for the proven defects (at [245]-[249]); 3. set out the process for determining the costs of the proceedings (at [250]-[253]).

The 26 May 2023 decision

In the 26 May 2023 decision, the Tribunal set out the terms of the work order in accordance with annexures A and B.

The 22 June 2023 decision

In the 22 June 2023 decision, the Tribunal set out the reasons for the 22 June 2023 orders (at [2]-[16]).

The history of the appeal

On 1 September 2023, Redmyre as the appellant commenced proceedings 2023/00280808 against Mr and Mrs Stockman as the respondents by filing the following documents: 1. a notice of appeal containing the details in annexure A for sections 5, 6 and 7, but not including section 5C specifying the orders it contended the Appeal Panel should make (the notice of appeal); 2. an application for a stay of orders 1 to 11 of the 18 May 2023 orders, order 1 of the 26 May 2023 orders and orders 2 and 3 of the 22 June 2023 orders (the stay application).
On 15 September 2023, the Appeal Panel constituted by a Principal Member granted the parties leave to be legally represented, dismissed the stay application, and made procedural directions for the hearing of the appeal.
On 22 September 2023, Mr and Mrs Stockman filed their reply to appeal.

The hearing of the appeal

At the commencement of the hearing, we granted leave to Redmyre to file an amended annexure A to the notice of appeal (which did not include section 5C specifying the orders it contended the Appeal Panel should make) relevantly: 1. specifying that orders 1 and 2 of the 26 May 2023 orders and order 2 of the 22 June 2023 orders are challenged on appeal; 2. specifying the following grounds of appeal: "1. The primary member failed to accord natural justice or constructively failed to exercise the Tribunal's jurisdiction by failing to respond to the argument made on behalf of the Appellant (Builder) to the effect that an inference adverse to the Respondents (Mr and Mrs Stockman) should be drawn in light of their explained failure to call Mr Stockman to give evidence relevant to the question of whether there was a contract between Mr and Mrs Stockman and the Builder to carry out sub floor work. 2. The primary member erred in failing to consider whether to draw an adverse inference against Mr and Mrs Stockman in light of their explained failure to call Mr Stockman to give evidence relevant to the question of whether there was a contract between Mr and Mrs Stockman and the Builder to carry out sub-floor work." 1. seeking leave to appeal on the grounds that the decision not fair and equitable and against the weight of evidence; 2. seeking an extension of time to appeal.
We raised the question of whether Redmyre was seeking an amendment of the notice of appeal to include the orders it contended the Appeal Panel should make and pointed out that the proposed setting aside of order 1 of the 26 May 2023 orders would appear to encompass defects that were not affected by the issues on the appeal. Counsel for Redmyre asked for this issue to be deferred to the end of the hearing.
Redmyre relied on the following evidence which was admitted into evidence without objection: 1. the affidavit of Mr Gouros sworn on 1 September 2023 which was marked as exhibit A1 (the 1 September 2023 Gouros affidavit); 2. the affidavit of Mr Gouros sworn on 8 September 2023 which was marked as exhibit A2 (the 8 September 2023 Gouros affidavit); 3. the affidavit of Mr Gouros sworn on 11 September 2023 which was marked as exhibit A3 (the 11 September 2023 Gouros affidavit).
Mr and Mrs Stockman relied on the affidavit of their solicitor, Alistair Woodward Little (Mr Little), affirmed on 13 September 2023 which was admitted into evidence without objection and marked as exhibit R1 (the 13 September 2023 Little affidavit).
The parties provided an appeal tender bundle containing the evidence and submissions before the Tribunal and the evidence and submissions on appeal.
Redmyre relied on its written submissions dated 13 October 2023 (Redmyre's appeal submissions). Mr and Mrs Stockman relied on their written submissions dated 30 October 2023 (Mr and Mrs Stockman's appeal submissions).
In addition to relying on their respective written submissions, counsel for Redmyre and Mr and Mrs Stockman made oral submissions. Counsel for Redmyre indicated that leave to appeal was sought on the ground that the decision was not fair and equitable.
At the conclusion of the hearing, the parties requested that our decision provide directions for the making of orders to dispose of the appeal including any application for costs.

The scope and nature of internal appeals

Internal appeals against an internally appealable decision may be made in the case of an interlocutory decision with leave of the Appeal Panel, and in the case of any other kind of decision (including an ancillary decision) as of right on a question of law, or with the leave of the Appeal Panel, on any other grounds: s 80(1) and (2) of the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act).
The circumstances in which the Appeal Panel may grant leave to appeal from decisions made in the Consumer and Commercial Division include where it is satisfied that the appellant may have suffered a substantial miscarriage of justice because the decision of the Tribunal under appeal was not fair and equitable: cl 12(1)(a) of Sch 4 of the NCAT Act.
Rule 25(4)(c) of the Civil and Administrative Tribunal Rules 2014 (NSW) (NCAT Rules) provides that, in the case of an appeal from a decision of the Tribunal, an internal appeal must be lodged within 28 days from the day on which the appellant was notified of the decision to be appealed or given reasons for the decision.

The issues for determination in the appeal

The following issues arise for determination in this appeal or may arise for determination depending on the outcome of anterior issues: 1. issue 1: whether an extension of time to appeal should be granted; 2. issue 2: whether the Tribunal failed to accord natural justice or constructively failed to exercise jurisdiction by failing to respond to a submission of Redmyre relevant to the question of whether there was a contract between Mr and Mrs Stockman and Redmyre to carry out sub floor work and if so whether the Tribunal made an error of law on a material matter; 3. issue 3: whether the Tribunal erred in failing to consider whether to draw an adverse inference against Mr and Mrs Stockman in light of their unexplained failure to call Mr Stockman to give evidence relevant to the question of whether there was a contract between Mr and Mrs Stockman and the Redmyre to carry out sub-floor work; 4. issue 4: the costs of the appeal.

Issue 1: whether an extension of time to appeal should be granted

Introduction

It was common ground between the parties that the appeal was not lodged within the time of 28 days prescribed under r 25(4)(c) of the NCAT Rules. However, they disagreed as to when time began to run with Mr and Mrs Stockman contending it was from 15 February 2023 and Redmyre contending it was from 26 May 2023.
It is therefore necessary to consider whether Redmyre should be granted an extension of time to appeal under s 41 of the NCAT Act. Before considering this issue, it is appropriate to summarise the evidence and submissions of the parties. The evidence of Redmyre is contained in the three affidavits of Mr Gouros. The evidence of Mr and Mrs Stockman is contained in the 13 September 2023 Little affidavit. It is also appropriate to set out the history of the renewal proceedings of Mr and Mrs Stockman.

The 1 September 2023 Gouros affidavit

In the 1 September 2023 Gouros affidavit, Mr Gouros relevantly gave the following evidence: 1. upon reviewing the 15 February 2023 decision, he was not content with the outcome and wanted to lodge an appeal. However, Redmyre was not in a position to instruct its solicitors and counsel to proceed with the appeal as it did not have the finances available (at [5]); 2. on or about March 2023, Redmyre applied for a loan of $100,000 with the Commonwealth Bank of Australia (CBA) to pay various expenses it incurred including its legal costs for obtaining advice on the prospects of an appeal from the 15 February 2023 decision and if appropriate prosecuting that appeal (at [6]); 3. on 20 March 2023, the CBA approved the loan application in the sum of $55,000 (the CBA loan) (at [7]); 4. Redmyre had to use the funds advanced from the CBA on 24 March 2023 to pay general business expenses, wages and working capital (at [8]-[9]); 5. Redmyre was unsuccessful in obtaining a loan from family members between 10 March 2023 and in about late May or early June 2023 (at [10]-[11]); 6. Redmyre has been able to raise finances to prosecute the appeal by undertaking some small jobs at various sites to pay for legal costs in connection with the appeal and issuing invoices since 10 April 2023 (at [12]-[13], [19]); 7. on or about 4 May 2023, Redmyre received advice on the prospects on an appeal from the 15 February 2023 decision. He did not instruct the solicitors and counsel of Redmyre to lodge the appeal immediately as he needed time to consider the advice and further discuss it with the solicitors, he wanted to first see what decision would be made as to costs, and Redmyre had not obtained funds sufficient to fund the prosecution of the appeal (at [14]-[15]); 8. on 23 June 2023, the solicitors for Redmyre wrote to the solicitors for Mr and Mrs Stockman to ascertain what costs they would be claiming from the Redmyre on his instructions as he wanted to know the quantum of the costs claimed by them before making a final decision on the appeal (the 23 June 2023 email) (at [17]); 9. on 24 August 2023, the solicitors for Mr and Mrs Stockman responded to this email stating that their costs were in the amount of $258,141.34 (at [18]); 10. he explained the difficulties experienced in the progress of the rectification works (at [23]-[31]).

The 8 September 2023 Gouros affidavit

In the 8 September 2023 Gouros affidavit, Mr Gouros relevantly gave the following evidence: 1. Redmyre has been able to raise further finances to prosecute the appeal (at [5]); 2. he explained the difficulties experienced in the progress of the rectification works (at [6]-[10]).

The 11 September 2023 Gouros affidavit

In the 11 September 2023 Gouros affidavit, Mr Gouros relevantly gave evidence that one of the substantial reasons for why Redmyre did not lodge the appeal earlier was because he was waiting for a response to the 23 June 2023 email to know what the quantum of costs sought by Mr and Mrs Stockman would be. This response was only provided on 24 August 2023 (at [3]).

The 13 September 2023 Little affidavit

In the 13 September 2023 Little affidavit, Mr Little relevantly gave the following evidence: 1. Mrs Stockman's parents occupied the property prior to the Tribunal proceedings and currently live with her sister and her husband in a small residence which is not suitable for them and poses a safety hazard for them due to a flight of stairs leading down to street level. When the rectification works are completed, they intend to return to the property (at [9]); 2. Mrs Stockman's mother has suffered from Alzheimer's Disease and vascular dementia diagnosed in 2015 and cardiomyopathy detected in the same year. She has wandered off her current residence without supervision on three separate occasions, with her intention being a desire to return to the property (at [10(a)]-[10(b]); 3. he has annexed a report prepared in March 2023 from each of the general practitioner, the neurologist, the pharmacist and the cardiologist of Mrs Stockman's mother, who each opine that she would benefit by returning to live at the property (at [10(c)]-[10(e]).

The history of the renewal proceedings

On 4 August 2023, Mr and Mrs Stockman as the applicants commenced proceedings HB 23/35965 in the Consumer and Commercial Division of the Tribunal against Redmyre as the respondent by filing a renewal of proceedings application in which they are claiming a money order (the renewal proceedings).
On 25 August 2023, the Tribunal made procedural orders for the hearing of the renewal proceedings.
On 5 September 2023, the Registrar fixed the renewal proceedings for hearing on 11 December 2023.

The submissions for Redmyre

In Redmyre's appeal submissions, Redmyre submitted it should be granted an extension of time to lodge the appeal in circumstances where the appeal is reasonably arguable, its delay is explained, it would suffer prejudice if an extension of time were refused, and no substantial prejudice would be suffered by Mr and Mrs Stockman if an extension of time is granted.
In his oral submissions, counsel for Redmyre referred to the significant amount of costs at stake and the absence of delay after 24 August 2023. He also referred to the time to appeal of three months in the case of an appeal to the New South Wales Court of Appeal.

The submissions for Mr and Mrs Stockman

In Mr and Mrs Stockman's appeal submissions, Mr and Mrs Stockman have made the following submissions: 1. the notice of appeal was filed after the commencement and the directions hearing in the renewal proceedings; 2. the relevant considerations on an application to extend time have been identified in Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22 (Jackson) at [22]: 3. Redmyre has no real prospects of success given that any Jones v Dunkel direction (which is discussed at [76] and [91] to [99] below), even if required, would not have materially affected the decision; 4. as to the time to lodge an appeal, it ran from the date of publication of the 15 February 2023 decision on 15 February 2023 until 15 March 2023; 5. there is no evidence that Redmyre was misadvised as to that requirement; 6. the extension sought is not for a short period and there was no indication from Redmyre that it was considering an appeal: 1. after publication of the 15 February 2023 decision; 2. after the making of the 22 June 2023 orders; 3. at any intermediate point; 1. Redmyre's explanations for that delay that: 1. it did not have the finances available to proceed with any appeal, and 2. it was awaiting the decision of the Tribunal as to costs, are not inherently persuasive of there being a proper occasion for an exercise of discretion in its favour; 1. the CBA loan was used for other purposes; 2. advice on prospects was obtained on or about 4 May 2023; 3. no stays were sought other than upon the filing of notice of appeal on 1 September 2023; it was refused on 15 September 2023; 4. no security for the costs of the appeal has been offered; 5. there will be significant prejudice occasioned upon Mr and Mrs Stockman (and their family) if an extension of time is granted in circumstances where Redmyre has not completed the rectification works by 21 July 2023, and have not meaningfully progressed the works at all. This is because: 1. any extension of time will further delay the completion of the renewal proceedings, and 2. Mrs Stockman's elderly parents have been the long-term occupants of the property but are currently residing with Mrs Stockman's sister while they await the completion of the work order. Mrs Stockman's mother suffers from Alzheimer's disease. Any extension of time will further delay their re-entry into the property.
In his oral submissions, counsel for Mr and Mrs Stockman when questioned about his submission that time for the appeal ran from publication of the 15 February 2023 decision referred to rr 25(4) and (4A) of the NCAT Rules and Florida Kitchens Pty Ltd v No 1 Cutting Service Pty Ltd [2018] NSWCATAP 281 (Florida Kitchens) at [6]-[11].

Consideration

The relevant principles for the granting of an extension of time to appeal under s 41 of the NCAT Act are set out in Jackson at [21] and [22]: "[21] Time limits, including the specification of the time within which an appeal from an internally appealable decision to the Appeal Panel of the Tribunal must be lodged, are established by legislation for the purpose of promoting the orderly and efficient conduct of proceedings in the Tribunal, providing certainty for the parties to proceedings, especially the party in whose favour orders have been made, and achieving finality in litigation. For these reasons, these time limits should generally be strictly enforced. That is not to say, however, that exceptions should not be made where the interests of justice so require. The express power in s 41 of the Act to grant extensions of time allows the Tribunal to prevent the rigid enforcement of time limits becoming an instrument of injustice. As the decision in Gallo v Dawson quoted above makes clear, it is generally the case that in order for the power to extend time to be exercised in an appellant's favour there must be material upon which the Appeal Panel can be satisfied that to refuse the application for an extension of time would work an injustice. [22] The considerations that will generally be relevant to the Appeal Panel's consideration of whether to grant an extension of time in which to lodge a Notice of Appeal include: (1) The discretion can only be exercised in favour of an applicant upon proof that strict compliance with the rules will work an injustice upon the appellant - Gallo v Dawson [1990] HCA 30, 93 ALR 479 at [2], Nanschild v Pratt [2011] NSWCA 85 at [38]; (2) The discretion is to be exercised in the light of the fact that the respondent (to the appeal) has already obtained a decision in its favour and, once the period for appeal has expired, can be thought of as having a "vested right" to retain the benefit of that decision - Jackamarra v Krakouer (1998) 195 CLR 516 at [4], Nanschild v Pratt [2011] NSWCA 85 at [39] and, in particular, where the right of appeal has gone (because of the expiration of the appeal period) the time for appealing should not be extended unless the proposed appeal has some prospects of success - Jackamarra at [7]; (3) Generally, in an application for an extension of time to appeal the Appeal Panel will be required to consider: (a) The length of the delay; (b) The reason for the delay; (c) The appellant's prospects of success, that is usually whether the applicant has a fairly arguable case; and (d) The extent of any prejudice suffered by the respondent (to the appeal), - Tomko v Palasty (No 2) (2007) 71 NSWLR 61at [55] (per Basten JA) but note also [14], Nanschild v Pratt [2011] NSWCA 85 at [39] to [42]; and (4) It may be appropriate to go further into the merits of an appeal if the explanation for the delay is less than satisfactory or if the opponent has a substantial case of prejudice and, in such a case, it may be relevant whether the appellant seeking an extension of time can show that his or her case has more substantial merit than merely being fairly arguable - Tomko v Palasty (No 2) (2007) 71 NSWLR 61 at [14] (per Hodgson JA, Ipp JA agreeing at [17]) and Molyneux v Chief Commissioner of State Revenue [2012] NSWADTAP 53 at [58] - [59]."
The New South Wales Court of Appeal has referred to Jackson at [22] and stated that the relevant principles to be applied are not controversial: EFQ (a pseudonym) v Medical Council of New South Wales [2021] NSWCA 167 at [17]-[19] (Bell P with Macfarlan JA at [78] and Brereton JA at [79] agreeing).
In Gallo v Dawson [1990] HCA 30; (1990) 64 ALJR 458, the applicant required an extension of the 21 days permitted for an appeal from a single judge in the High Court by a period of more than 16 months. McHugh J stated (at p 459, col 2): "Indeed, the terms of her affidavit suggest that she made a conscious decision not to appeal until she had satisfied herself that she could succeed in an appeal. I doubt that I would have considered the applicant's explanation for the delay to be a sufficient reason for enlarging the time for lodging her appeal … even if I had thought that the applicant had real prospects of succeeding in her proposed appeal. A case would need to be exceptional before a court would enlarge by many months the time for lodging an appeal simply because the applicant had refrained from appealing until he or she had researched the issues involved. … It would make a mockery of O 70, r 3 if, months after the time for appealing has expired, the unsuccessful party could obtain an extension of time on the ground that he or she had delayed appealing because that person wanted to research the issues involved. Lack of legal knowledge is a misfortune, not a privilege."
In Tomko v Palasty (No 2) (2007) 71 NSWLR 61; [2007] NSWCA 369 the New South Wales Court of Appeal dismissed the application of the respondent for an extension of time to cross-appeal against the judgment and orders of the District Court. The Court of Appeal (Basten JA with Hodgson JA at [1] and Ipp JA at [17] agreeing) after referring (at [55]) to the four general factors (which are set out in Jackson at [22(2)]) referred (at [56]) to the observations of Kirby J in Jackamarra v Krakouer (1998) 195 CLR 516; [1998] HCA 27 (Jackamarra) at [66(7)]: "But they are by no means exhaustive. Several others have from time to time been thought relevant. These include whether the delay was intentional or contumelious; or merely the result of a bona fide mistake or blunder; and whether the delay is that of the litigant or of its lawyers, with which the litigant should not be saddled. It may also be relevant, where the default is that of a party's legal representatives, to take into account any considerations personal to the party which might have affected its ability to safeguard its own interests, for example, by applying pressure to its lawyers. Similarly, the extent to which any such prejudice may be remedied by an appropriate costs order is another consideration that has sometimes been treated as relevant."
In Tomko v Palasty (No 2), the Court of Appeal at [81] (Basten JA with Hodgson JA at [1] and Ipp JA at [17] agreeing) cited the observations of McHugh J in Gallo v Dawson at 459.
It is convenient to separately consider each of the four factors identified in Jackson at [22(3)].

The length of the delay

We note at the outset that Redmyre's appeal is against orders 1 and 2 of the 26 May 2023 orders and order 2 of the 22 June 2023 orders. It is not appealing against the 15 February 2023 orders.
We do not accept that rr 25(4) and (4A) of the NCAT Rules and Florida Kitchens at [6]-[11] support Redmyre's submission that the time to lodge an appeal ran from the date of publication of the 15 February 2023 decision on 15 February 2023. The Appeal Panel in Florida Kitchens considered an application for an extension of time to lodge an appeal where there had been two decisions: the liability decision on 5 December 2017 whereby the appellant, the respondent at first instance, was ordered to pay the respondent, the applicant at first instance, the sum of $20,130; the costs decision on 12 June 2018 whereby the appellant was ordered to pay the respondent's costs of the proceedings at first instance on an indemnity basis as agreed or assessed. The Appeal Panel at [10] held that liability decision was a final and enforceable decision which stood independently of the costs decision.
Unlike the 15 February 2023 decision, the liability decision in Florida Kitchens contained a substantive order.
In Cao v Lavish Construction and Developments Pty Ltd [2022] NSWCATAP 391 (Cao) at [42]-[58] the Appeal Panel considered whether an appeal was competent in circumstances where the Tribunal had made a decision on liability in relation to a claim for defective work under the HB Act and proposed making a work order if the parties so required, but had not made any such order. The Appeal Panel considered the meaning of an "internally appealable decision" within s 80(1) of the NCAT Act having regard to the ss 5, 28, 29 and 32 of the NCAT Act and applicable authorities. Section 5 contains an inclusive definition of "decision". Section 28 deals with the jurisdiction of the Tribunal generally and in s 28(2)(a) specifies that this jurisdiction includes the general jurisdiction of the Tribunal. Section 29 deals with the general jurisdiction of the Tribunal and in s 29(3) contains a definition of a "general decision". Section 32 deals with the internal appeal jurisdiction of the Tribunal and in s 32(4) and (5) contains definitions of an "internally appealable decision" and an "internal appeal". The Appeal Panel at [55(a)] found that there cannot be a decision unless there is an ultimate or operative determination in the proceedings. It followed that there was no internally appealable decision within s 32(4) of the NCAT Act against which the appellant could appeal pursuant to s 80(1) of the NCAT Act.
In our view, having regard to the principles in Cao at [42]-[58] and in particular ss 5, 28, 29 and 32 of the NCAT Act, the 15 February 2023 decision was not an ultimate or operative determination in Tribunal the proceedings. Not only was a work order yet to be made, but also the Tribunal had not determined the precise terms of the work order.
Having regard to the principles in Florida Kitchens at [6]-[11], it was only when the Tribunal made: 1. the 26 May 2023 decision that time began to run for any appeal by Redmyre against the 26 May 2023 orders; 2. the 22 June 2023 decision that time began to run for any appeal by Redmyre against the 22 June 2023 orders.
It follows that the last day for Redmyre to file a notice of appeal: 1. against the 26 May 2023 orders was 24 June 2023. The delay was 69 days; 2. against the 22 June 2023 orders was 21 July 2023. The delay was 43 days.
In each case the delay was substantial.
Rule 51.8 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) when read with the definition of "material date" in r 51.2 provides that a notice of intention to appeal to the New South Wales Court of Appeal must be filed and served on each prospective respondent within 28 days after the order intended to be appealed against. Rule 51.9(1) of the UCPR when read with the definition of "material date" in r 51.2 provides that an applicant who has filed and served a notice of intention to appeal must file and serve a notice of appeal within 3 months or within such other period as the Court may order after the order intended to be appealed against. The fact that a longer time may be allowed for an appeal to the New South Wales Court of Appeal is irrelevant when considering whether an extension of time should be granted under s 41 of the NCAT Act.

The reason for the delay

We accept the evidence of Mr Gouros in the 1 September 2023 Gouros affidavit that on or about 4 May 2023 when Redmyre received advice on the prospects on an appeal from the 15 February 2023 decision he did not instruct the solicitors and counsel of Redmyre to lodge the appeal immediately as he needed time to consider the advice and further discuss it with the solicitors, he wanted to first see what decision would be made as to costs, and Redmyre had not obtained funds sufficient to fund the prosecution of the appeal.
However, this evidence of Mr Gouros does not satisfactorily address the reason for the delay in the following respects: 1. there is no evidence as to the cost involved in a further discussion with Redmyre's solicitors and the capacity of Redmyre to pay for that cost. As to the desire of Mr Gouros to further discuss the advice on the prospects on an appeal from the 15 February 2023 decision with Redmyre's solicitors, the observations of McHugh J in Gallo v Dawson at 459 that "(l)ack of legal knowledge is a misfortune, not a privilege" are apposite; 2. there is no evidence as to the cost involved in Redmyre's solicitors in preparing and filing a notice of appeal and the capacity of Redmyre to pay for that cost; 3. there is no evidence that he was incapable of preparing and filing a notice of appeal.
Further, we do not regard Mr Gouros's desire to see the 22 June 2023 decision as providing a satisfactory reason for the delay in filing a notice of appeal against the 26 May 2023 orders.
We also accept the evidence of Mr Gouros in the 11 September 2023 Gouros affidavit that one of the substantial reasons for why Redmyre did not lodge the appeal earlier was because he was waiting for a response to the 23 June 2023 email to know what the quantum of costs sought by Mr and Mrs Stockman would be.
We are satisfied in the light of this evidence of Mr Gouros that the delay was intentional which we regard as being relevant consistently with Jackamarra at [66(7)] and Tomko v Palasty (No 2) at [56].
There is no evidence of Mr Gouros that he was unaware of the time limit for an appeal under r 25(4)(c) of the NCAT Rules. In all the circumstances, we are not satisfied that Redmyre has provided a satisfactory explanation for the delay in filing the notice of appeal.

The extent of any prejudice suffered by Mr and Mrs Stockman

We accept the evidence of Mr Little in the 13 September 2023 Little affidavit as to the medical condition of Mrs Stockman's mother, and the evidence of her doctors and pharmacist that she would benefit by returning to live at the property. We also accept the evidence Mr Little that Mrs Stockman's parents intend to return to the property which they occupied prior to the Tribunal proceedings when the rectification works are completed, and that their current residence poses a safety hazard for them.
We do not accept the submission of Mr and Mrs Stockman that an extension of time to appeal will further delay the completion of the renewal proceedings. The hearing on 11 December 2023 has already been fixed. While we agree that a successful appeal is likely to delay the completion of the renewal proceedings, the relevant question is whether an extension of time to appeal will occasion any prejudice to Mr and Mrs Stockman. We cannot see any significant prejudice related to the renewal proceedings.
We also do not accept the submission of Mr and Mrs Stockman that an extension of time to appeal will further delay the re-entry of Mrs Stockman's parents into the property. While we agree that a successful appeal is likely to delay their re-entry into the property, the relevant question is whether an extension of time to appeal will occasion any prejudice to the parents of Mrs Stockman. We cannot see any significant prejudice related to their re-entry into the property.

Redmyre's prospects of success

In view of our finding that we are not satisfied that Redmyre has provided a satisfactory explanation for the delay in filing a notice of appeal, then as set out in Jackson at [22(4)] we have approached this question on the basis that Redmyre must show that its case has more substantial merit than merely being fairly arguable.
In Redmyre's appeal submissions, Redmyre indicated that its appeal was being made on the following on the following question of law: "Did the primary member fail to accord natural justice or constructively fail to exercise the Tribunal's jurisdiction by failing to respond to the argument made on behalf of the Appellant (Builder) to the effect that an inference adverse to the Respondents (Mr and Mrs Stockman) should be drawn in light of its unexplained failure to call Mr Stockman to give evidence relevant to the question of whether there was a contract between Mr and Mrs Stockman and the Builder to carry out sub floor work?"
Redmyre contended that this question raises a question of law and referred to Dranichnikov v Minister for Immigration and Multicultural Affairs [2003] HCA 26; (2003) 77 ALJR 1088 (Dranichnikov) at [24]-[25].
Mr and Mrs Stockman accepted that this question raises a question of law.
In their written and oral submissions, the parties addressed the following three questions: 1. whether the Tribunal failed to consider Redmyre's adverse inference submission; 2. if the Tribunal failed to consider Redmyre's adverse inference submission, whether that failure constituted an error; 3. if the Tribunal failed to consider Redmyre's adverse inference submission and that failure constituted an error, whether the error was material.
While Redmyre's appeal submissions referred to the "Adverse Inference Submission" and to this extent tends to confuse, counsel for the parties were in agreement as to the content of the rule in Jones v Dunkel.
The rule in Jones v Dunkel is derived from the judgment of the High Court in Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8 at 308 (Dixon CJ), 312 (Menzies J), 320-321 (Kitto J). The rule has recently been discussed in Wang v Yu [2023] NSWSC 1182 at [123]-[137] where Meek J relevantly stated: "… [125] The rule in Jones v Dunkel is a principle of judicial reasoning which addresses the drawing of inferences of fact: Ling v Pang [2023] NSWCA 112 (Ling) at [24] per Kirk JA (Leeming and Mitchelmore JJA at [1], [2] respectively agreeing). [126] The rule has been described in various ways. [127] Two types of inferences that might in any given circumstances be drawn are that: (1) the unexplained failure by a party to call a witness may in appropriate circumstances support an inference that the uncalled evidence would not have assisted the party's case; and (2) the failure to call a witness may also permit the Court to draw, with greater confidence, any inference unfavourable to the party that failed to call the witness, if that uncalled witness appears to be in a position to cast light on whether the inference should be drawn: Kuhl v Zurich Financial Services Australia Ltd (2011) 243 CLR 361; [2011] HCA 11 (Kuhl) at [63] per Heydon, Crennan and Bell JJ. [128] The rule permits an inference, not that the evidence not called by a party would have been adverse to the party, but that it would not have assisted the party: Kuhl at [64] citing Dilosa v Latec Finance Pty Ltd (No 2) [1966] NSWR 259 (Dilosa) at 276-277 per Street J. [129] The rule applies only once all the evidence in the case is in. Whether some inference should be drawn, what inference, and with what significance are all matters depending upon the circumstances of the particular case. It is not a rule to be applied formulaically: Ling at [24]. … [137] Exactly the same principles apply when a party, who is capable of testifying, fails to give evidence as in a case where any other available witness is not called: Jones v Dunkel per Windeyer J at 321 citing Wigmore on Evidence vol 2, ss 289,290, pp 171-180; see also Dilosa at 276-277; Kuhl at [63]. …"
We have separately considered each of these three questions in assessing Redmyre's prospects of success. There is an anterior question of whether the appeal raises a question of law. It is convenient to consider the anterior question and the first of the three questions together, and then the second and third questions together.

Whether the Tribunal failed to consider Redmyre's adverse inference submission

In Dranichnikov, the High Court considered the question of whether the Refugee Review Tribunal failed to exercise jurisdiction to review a decision of the delegate of the Minister. Gummow and Callinan JJ at [24]-[25] stated (with Hayne J at [95] agreeing): "[24] To fail to respond to a substantial, clearly articulated argument relying upon established facts was at least to fail to accord Mr Dranichnikov natural justice. … [25] The question remains however whether what occurred, either characterised as a failure to accord natural justice or as that, and more, which we consider it to be, including a constructive failure to exercise jurisdiction, entitles Mr Dranichnikov to relief under s 75(v) of the Constitution. It is to that question that we will now turn."
In Alexandria Landfill Pty Ltd v Transport for NSW (2020) 103 NSWLR 479; [2020] NSWCA 165 (Alexandria Landfill), the members of the New South Wales Court of Appeal (Basten JA, Macfarlan JA and Leeming JA) in separate judgments gave an extensive explanation of the principles applicable to the constructive failure to exercise jurisdiction and the related failure to give adequate reasons.
At [6]-[7], Basten JA explained the notion of a constructive failure to exercise jurisdiction: "[6] The premise underlying a "constructive" failure to exercise jurisdiction is that there has been an apparent exercise of the jurisdiction of the court, but one that has failed in a way which can only be teased out by reference to the underlying issues and the materials presented to the court. It may then be demonstrated that a material issue presented for determination has not been resolved. By contrast, a failure to give adequate reasons implies that the relevant issues have been identified, addressed and resolved, but the reasons for reaching the conclusion have not been adequately expressed. [7] Despite the conceptual difference between the two complaints, they are related in a practical way. Because there is no means of interrogating a judge as to his or her intellectual processes, evidence that issues were not addressed can usually only be demonstrated by reference to the reasons. Thus, on the assumption that the judge addressed in the reasons all material matters, the absence of reference to a particular matter may allow the inference that it was not addressed and determined." (footnote omitted)
At [8]-[34], Basten JA set out the principles with respect to a constructive failure to exercise jurisdiction and adequacy of reasons including at [20]-[23]: "[20] On an appeal limited to questions of law, it does not provide a basis for reviewing the judge's determination of what factual matters are in issue, or the manner in which the judge has determined them. This point was addressed in Resource Pacific Pty Ltd v Wilkinson in the following terms: "[9] The adoption, on an appeal limited to errors in point of law, of language derived from the supervisory jurisdiction of the court must be undertaken with caution. It is, no doubt, an error of law for the trial court to fail to exercise its constitutional function, which is to resolve a dispute presented to it by the parties by applying the law in accordance with proper procedure. In the present case, that function was almost entirely satisfied by the resolution of disputed factual issues. The term 'constructive failure to exercise jurisdiction' is used to describe a situation where the court has purported to resolve the parties' dispute but has not in fact done so. Thus, particularly with a court or tribunal required to provide reasons for its decision, it may become apparent from those reasons that a material issue has simply not been addressed or that material evidence has been overlooked. Examples of circumstances which may properly give rise to a concern on this kind were referred to by Gummow ACJ and Kiefel J in Minister for Immigration and Citizenship v SZMDS [2010] HCA 16; 240 CLR 611 at [23]. On occasion, the function of the decision-maker (which should include a court) has been identified as being to 'give proper, genuine and realistic consideration to the merits of the case': Kahn v Minister for Immigration and Ethnic Affairs (1987) 14 ALD 291 (Gummow J). (The language probably derived from its use in equity to describe the proper exercise by a trustee of a discretionary power in relation to the trust.) Although the nature of the exercise, particularly with respect to discretionary powers, involves no bright-line boundary, care must be taken that the statutory mandate of the appellate court, limited to errors of law, is not breached by adopting as a standard inherently value laden language: see Minister for Immigration and Citizenship v SZJSS [2010] HCA 48; 243 CLR 164 at [30]." [21] As further explained in Boele v Rinbac Pty Ltd: "[54] This approach, followed in Goodwin v Commissioner of Police [2012] NSWCA 379 at [19]-[25], is, perhaps, a preferable conceptual framework than the reference in Dranichnikov to a failure to accord natural justice. The word constructive may not be entirely apt, but it is understood as meaning 'purported', in the sense of there being the appearance of an exercise of jurisdiction, but one which does not conform to the requirements of the law. Whatever language is used, such a failure will generally involve jurisdictional error, analogous to a legally erroneous refusal to exercise an available power: cf Public Service Association of South Australia Incorporated v Industrial Relations Commission of South Australia [2012] HCA 25; 249 CLR 398 at [34] (French CJ) and [65] (Gummow, Hayne, Crennan, Kiefel and Bell JJ). It means that the process of decision-making in the tribunal, being the very function vested in the tribunal by statute, has miscarried." [22] It follows that the relevant grounds in a case alleging error of law are not expanded by reference to a constructive failure to exercise jurisdiction. If there has been jurisdictional error (including with respect to the determination of jurisdictional facts) there will have been error of law which can be addressed on an appeal limited to a question of law. In a case where a court has set out the competing material (thus engaging with an issue) and decides in favour of a particular result, without explaining why, the reasons will fail to meet the criterion of transparency required of judicial decision-makers. Where some reasons are given, expressly or implicitly the element of transparency may well be met, even if an appellate court considering an appeal by way of rehearing would find the reasons flawed. [23] To the extent that the appellant is not able to demonstrate that the trial judge failed to consider any essential element of the claim for compensation, a separate question will arise as to whether the reasons given for the outcome were sufficient in law." (citations omitted)
At [294]-[314], Macfarlan JA set out the principles with respect to a constructive failure to exercise jurisdiction and adequacy of reasons including at [308]: "[308] In Whisprun Pty Ltd v Dixon [2003] HCA 48; (2003) 77 ALJR 1598 this Court had ordered the new trial of a personal injury damages claim, finding that the primary judge had in effect overlooked relevant parts of the evidence. By a majority in the High Court, this Court's decision was reversed. In the course of its judgment, the majority said: "[62] … it should not be accepted that [the primary judge] failed, at least in a general way, to consider the matters to which the Court of Appeal referred. The fact that his Honour did not refer to these matters in his judgment is not decisive. A judge's reasons are not required to mention every fact or argument relied on by the losing party as relevant to an issue. Judgments of trial judges would soon become longer than they already are if a judge's failure to mention such facts and arguments would be evidence that he or she had not properly considered the losing party's case. [63] … To suggest that a trial judge has not properly considered a party's case is a serious charge. Such a suggestion should be accepted only when the record of the trial or other evidence persuasively suggests that the judge failed to discharge that paramount judicial duty. …""
At [400]-[410], Leeming JA set out the principles with respect to a constructive failure to exercise jurisdiction and adequacy of reasons including at [400], [403]: "[400] It is perhaps unfortunate that part of the debate focussed about the meaning of "grappled" in this context. The expression is not uncommonly used in determining appeals from the District Court …, or from a Division of the Supreme Court …. However, as has been explained …. what is being inferred in such cases is a failure in the process of fact finding. …" "[403] Where an appeal is confined to questions of law, the considerations summarised above - which are directed to the resolution of competing issues of fact - do not directly arise. While I accept that some errors in the fact finding process may amount to errors of law (actual bias is an example), I also think that one cannot safely transplant the principles applicable to an appeal by way of rehearing to appeals confined to questions of law." (authorities omitted)
At [411]-[412], Leeming JA expressed the following conclusion on the grounds of appeal relating to a constructive failure to exercise jurisdiction and adequacy of reasons: "[411] It follows that the appellant's submissions insofar as they complain of failing to engage with the evidence and submissions are outside the scope of an appeal confined to questions of law. In reaching that conclusion, I am conscious that the fact/law distinction is scarcely a crisp one. The High Court's statement in Collector of Customs v Agfa-Gevaert Ltd (1996) 186 CLR 389 at 394; [1996] HCA 36 that "no satisfactory test of universal application has yet been formulated" is to be understood not merely of the failure hitherto to do so, but as an acknowledgement of the impossibility of the task. Even so, the limitation imposed by s 57 of the Land and Environment Court Act must be given work to do, and I am satisfied that on its proper construction, the complaints advanced by the appellant do not give rise to legal error. [412] Ultimately the appellant's submissions, faced with the task of falling within an appeal limited to questions of law, sought to transmute deficiencies in factual findings into deficiencies in the process of making findings or recording reasons. I am unpersuaded that the appellant can in that fashion make out legal error, as opposed to factual error."
In the Tribunal proceedings, Redmyre relevantly made the following submissions in its Outline of Builder's Closing Submissions dated 28 October 2022 (Redmyre's closing submissions): "… 17. in the circumstances, the Tribunal ought to draw an inference that any evidence Mr Stockman was prepared to give would not have assisted the Owners particularly since: (a) the failure to call Mr Stockman has not been explained; (b) it is reasonably expected that Mr Stockman would have been able to give evidence about the relevant conversations and the other matters stated in his statement; (see Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298 and Xu v Ling [2022] NSWCATAP 266 at 37 to 42 per Senior Members Ellis SC and Currie). … 63. The Owners have not discharged their onus in proving that the Builder was contracted to and did carry out the Sub-Floor Works for the following reasons: … (g) even though Mr Stockman was a party to those alleged conversations, he chose for some unexplained reason not to give evidence at the hearing and his evidence was not relied on; (h) in the circumstances, the Tribunal ought to draw an inference that any evidence Mr Stockman was prepared to give would not have assisted the Owners particularly since: I the failure to call Mr Stockman has not been explained; and ii. it is reasonably expected that Mr Stockman would have been able to give evidence about the relevant conversations and the other matters stated in his Statements; (see Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298 and Xu v Ling [2022] NSWCATAP 266 at 37 to 42 per Senior Members Ellis SC and Currie). …"
Having regard to the principles explained in Alexandria Landfill at [6]-[34], [294]-[314] and [400]-[410], and particularly the conclusion of Leeming JA at [411]-[412], we are not satisfied that the appeal raises a question of law. On the contrary, Redmyre's complaint is about a factual error for which it requires leave to appeal.
We accept that in Redmyre's closing submissions at [17], [63(g)] and [63(h)], Redmyre made a submission as to the application of the rule in Jones v Dunkel.
We are not satisfied that the Tribunal failed to consider this submission. The Tribunal in the 15 February 2023 decision provided detailed reasons at [23]-[43] for its finding that Mr and Mrs Stockman contracted with Redmyre to carry out the ground floor sub floor work. As set out in the 15 February 2023 decision at [43], the Tribunal accepted the evidence of Mrs Stockman which was confirmed by the evidence of Mr Tarabay, who was engaged as a carpenter by Redmyre. In view of the evidence supporting this finding it was unnecessary for the Tribunal to engage with this submission.
For these reasons, we are not satisfied that the appeal has more substantial merit than merely being fairly arguable.

If the Tribunal failed to consider Redmyre's adverse inference submission, whether that failure constituted an error

If the Tribunal failed to consider Redmyre's adverse inference submission and that failure constituted an error, whether the error was material

In view of our finding that the Tribunal did not fail to consider Redmyre's adverse inference submission, the second and third questions do not arise for consideration. However, in case we are later found to be in error in this finding, we have considered these questions.
In Mr and Mrs Stockman's appeal submissions, Mr and Mrs Stockman relied on JPQS P/L v Cosmarnan Constructions P/L & 3 Ors [2003] NSWCA 66 (JPQS) at [24], Manly Council v Byrne and Anor [2004] NSWCA 123 (Manly Council) at [74], and Morley & Ors v Australian Securities and Investments Commission [2010] NSWCA 331; (2010) 247 FLR 140 (Morley) at [634].
In his oral submissions counsel for Redmyre relied on Australian Securities and Investments Commission v Hellicar (2012) 247 CLR 345; [2012] HCA 17 (Hellicar) at [164]-[170].
In JPQS, the New South Wales Court of Appeal dismissed the appeal by the appellant quantity surveyor against the finding of negligence in his certification. One of the issues in the appeal was the failure of the respondent joint venturers to call a witness. Meagher JA at [24] expressed the following conclusion (with Mason P at [3] substantially agreeing and Beazley JA at [32] agreeing): "[24] Again, much was made of the failure by the venturers to call a Mr Nicomede, an employee of one of the venturers. Such failure was said to bring into play the principles outlined by the High Court in Jones v Dunkel (1959) 101 CLR 298 or, as it should more properly be called, the Rule in Armory v Delamirie (1722) 93 ER 664; (1722) 1 Strange 505. The relevant principle is that if a party fails to call a witness whom it might reasonably be expected to call, an inference may be drawn that his evidence, were he called, would not assist that party. It is not easy to see how that principle has anything to do with the present case, and for three reasons. First, it is true that Mr Nicomede had great knowledge of the building trade, but only as a concreter, and it is hard to imagine what he could tell the Court, for example, about vanities or electrical installations. Secondly, when his Honour makes a finding about reliance, the absence of Mr Nicomede is of no moment. Thirdly, (and this is probably doing no more than repeating the previous reason), when a finding of fact has been made in a party's favour by a judge, the fact that an absent witness's evidence, if it were given, would not support that finding, cannot disturb the finding actually made."
In Manly Council, the New South Wales Court of Appeal dismissed the appeal by the appellant Council against the finding of negligence arising out of a swimming pool accident. One of the issues in the appeal was the failure of the respondent to call a witness. Campbell J at [40]-[74] (with Beazley JA at [1] and Pearlman AJA at [2] agreeing) explained the rule in Jones v Dunkel and its application and expressed the following conclusion at [73]-[74]: "[73] However, on the evidence in fact before his Honour, there was ample evidence to justify him in concluding that the light was off. In that situation, the fact that Melissa and Mrs Pratt were equally available to both parties justified him in not drawing any adverse inference from Brooke's failure to call them. [74] That the strength, or weakness, of the case made out by the evidence actually presented in the case bears on whether inferences should be drawn from other evidence not having been presented, is recognised in JPQS P/L v Cosmarnan Constructions P/L [2003] NSWCA 66. Meagher JA (with whom Beazley JA agreed, and Mason P substantially agreed) said, at [24]: "When a finding of fact has been made in a party's favour by a judge, the fact that an absent witness's evidence, if it were given, would not support that finding, cannot disturb the finding actually made.""
In Morley, the New South Wales Court of Appeal determined the appeals by the appellant directors and officers of a company against the imposition of civil penalties for breach of their statutory obligations. The Court of Appeal (Spigelman CJ, Beazley and Giles JJA) at [634] expressed the following conclusion about the failure to call witnesses: "[634] The first matter was the familiar, although often misunderstood, Jones v Dunkel reasoning from a party's unexplained failure to call a witness the party would be expected to call. The fact-finding tribunal may infer that the evidence of the absent witness would not assist the case of that party, or it may draw with greater confidence an inference unfavourable to that party. There is no compulsion to reason in either way. The reasoning cannot make up for absence of proof: before there can be greater confidence in an inference unfavourable to a party, the inference must already be available on the evidence. Conversely, if the party's case is otherwise proved, the inference that the absent witness would not assist the party's case does not detract from the proof. It is sufficient to refer to Manly Council v Byrne [2004] NSWCA 123 at [44]-[55], [69]-[74]."
In Hellicar, the High Court allowed appeals by some of the directors and officers of the company from the judgment of the New South Wales Court of Appeal in Morley. The plurality (French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ) at [164]-[170] dealt with the cogency of proof, and relevantly stated: "[164] The Court of Appeal concluded that ASIC's failure to call Mr Robb had "consequences for the cogency of ASIC's case". By this the Court of Appeal meant that the cogency of ASIC's proof was diminished. … [168] The Court of Appeal concluded that ASIC's not calling Mr Robb founded an inference that his evidence "would not have assisted the ASIC case". There was no basis for drawing any inference that Mr Robb would have given evidence adverse to ASIC's case. More particularly, there was no basis for concluding that it was more likely than not that he would say that the minutes whose preparation he had supervised were false. The most that could be inferred from Mr Robb not being called by ASIC was that he could not give evidence, from his own independent recollection, of what had happened at the February board meeting. He was not "a person presumably able to put the true complexion on the facts relied on [by ASIC] as the ground" for any inference that ASIC sought to have drawn from the evidence. … [169] ASIC had tendered admissible evidence that, if accepted, showed that the draft ASX announcement had been tabled and approved. This was not a case where ASIC's case depended on inference, let alone on "uncertain inferences", or where there was a question about whether "limited material is an appropriate basis on which to reach a reasonable decision". It was not a case where "the missing witness would be expected to be called by one party rather than the other" or where it was known that "his evidence would elucidate a particular matter" (emphasis added). … [170] The fact that ASIC did not call Mr Robb did not affect (in the sense of diminish) the cogency of the proof which ASIC advanced. Yet that is the conclusion the Court of Appeal reached: that the cogency of ASIC's proof was diminished because Mr Robb was not called to say no more than "I do not recall"." (italics in original and footnotes omitted)
In oral submissions when questioned about JPQS at [24] counsel for Redmyre drew attention to the words "(and this is probably doing no more than repeating the previous reason)" in the last sentence.
We are not satisfied that the principles articulated by the plurality in Hellicar at [164]-[170] qualify the principles explained by the New South Wales Court of Appeal in JPQS at [24], Manly Council at [74], and Morley at [634]. Further, we are not satisfied that the words "(and this is probably doing no more than repeating the previous reason)" in the last sentence JPQS at [24] in any way qualify the generality of the last sentence.
We are satisfied that the case of Mr and Mrs Stockman that they contracted with Redmyre to carry out the ground floor sub floor work was proved by the evidence of Mrs Stockman and Mr Tarabay referred to in the 15 February 2023 decision at [23]-[43] in the absence of evidence from Mr Stockman.
For these reasons, we would not have been satisfied of the following matters: 1. if the Tribunal had failed to consider Redmyre's adverse inference submission, then that failure would have constituted an error; 2. if the Tribunal had failed to consider Redmyre's adverse inference submission and that failure had constituted an error, then that error would have been material.

Conclusion

In the light of our findings, we have decided to dismiss the application of Redmyre to extend the time to file the notice of appeal to 1 September 2023.

Issue 2: whether the Tribunal failed to accord natural justice or constructively failed to exercise jurisdiction by failing to respond to a submission of Redmyre relevant to the question of whether there was a contract between Mr and Mrs Stockman and Redmyre to carry out sub floor work and if so whether the Tribunal made an error of law on a material matter

Issue 3: whether the Tribunal erred in failing to consider whether to draw an adverse inference against Mr and Mrs Stockman in light of their unexplained failure to call Mr Stockman to give evidence relevant to the question of whether there was a contract between Mr and Mrs Stockman and the Redmyre to carry out sub-floor work

In follows from our decision not to extend the time for Redmyre to file the notice of appeal to 1 September 2023 that these issues do not arise for determination.
If it had been necessary to determine one or both of these issues, for the reasons already given we would have determined them adversely to Redmyre.

Issue 4: the costs of the appeal

So far as we can see there should be no order as the costs of the appeal. However, if some different order is sought by a party, then application may be made to vary this costs order.

Orders

We make the following orders:
The application of the appellant to extend the time to file the notice of appeal to 1 September 2023 is dismissed.
The appeal is otherwise dismissed.
There is no order as to the costs of the appeal.
If any party wishes to make an application to vary order 3 above, the applicant (the costs applicant) must file and serve a costs application, including submissions limited to three pages and any evidence in support, on or before 14 days from the date of this decision.
The respondent to the costs application is to file and serve any submissions limited to three pages and any evidence in reply on or before 28 days from the date of this decision.
The costs applicant is to file any submissions limited to two pages in reply on or before 35 days from the date of this decision.
The parties are to indicate in their submissions whether they consent to an order dispensing with an oral hearing of the costs application, and if they do not consent, submissions of no more than one page as to why an oral hearing should be conducted rather than the application being determined on the papers. If a hearing is not dispensed with, the parties will be advised of a date for the hearing of the application.

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

Amendments 16 November 2023 - Paragraph [58(1)] amended from 26 June 2023 to 24 June 2023; 66 days becomes 69days 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: 16 November 2023

(2020) 103 NSWLR 479

At a glance

Court

Decision date

Before

Catchwords

Source

Catchwords

Judgment (36 paragraphs)

Parties

Legislation Cited (4)

Cases Cited (36)

Cited By (2)