Saad v Kassis

LEGISLATION CITED : Consumer Trader and Tenancy Tribunal Act 2001

Chapman v Taylor & Ors; Vero Insurance Ltd v Taylor & Ors [2004] NSWCA 456 Duncan v Cliftonville Estates Pty Limited [2001] NSWSC 968; (2001) 10 BPR 19,127; (2002) NSWConvR 56-006 Italiano v Carbone [2005] NSWCA 177 Kalokerinos & Anor v HIA Insurance Services Pty Ltd & Anor [2004] NSWCA 312 CASES CITED : Maconachie v Kullenberg [2005} NSWCA 294 Makita v Sprowles [2001] NSWSC 305 Menzie v CRCI Pty Ltd [2007] NSWCA 118 Sali v SPC Ltd (1993) 116 ALR 625 State of Queensland v JL Holdings Pty Ltd (1997) 189 CLR 146 Thomas v Nedeljkovic [2004] NSWSC 524

PARTIES : Paul Saad (Plaintiff) Sam Kassis (Defendant)

COUNSEL : Mr CC Dwyer (Plaintiff) Mr T Davie (Defendant)

SOLICITORS : Johnston Vaughan Solicitors (Plaintiff) Peter Merity (Defendant)

LOWER COURT JURISDICTION : Consumer Trader and Tenancy Tribunal of NSW

LOWER COURT JUDICIAL OFFICER : Senior Tribunal Member Durie

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION ADMINISTRATIVE LAW LIST

JUDGMENT (Appeal - refusal of adjournment- CTTT) 1 HER HONOUR: By summons filed 10 August 2007 the plaintiff seeks a declaration that he was denied natural justice, firstly, in respect of the hearing of his adjournment applications on 12 July 2007 before the Consumer, Trader and Tenancy Tribunal ("CTTT") and that such decision should be set aside; secondly, in respect of the costs order made following refusal of the adjournment and amendment applications in that he was not informed by the CTTT that it was going to proceed to order an amount for costs affording the plaintiff an opportunity to make submissions on the amount of those costs or exercise his right to have such costs assessed. The plaintiff seeks an order that the application filed 7 November 2006 in the CTTT be remitted for determination on the merits. 2 The plaintiff is Paul Saad (Mr Saad). The defendant is Sam Kassis (Mr Kassis). Mr Saad relied upon his own affidavit filed 10 August 2007. Mr Kassis relied upon the affidavits of Michelle Joanne Sultana filed on 1 November 2007 and 15 November 2007. For convenience I will refer to the parties by name.

The relevant statutory provisions 3 Section 65 of the Consumer, Trader and Tenancy Tribunal Act 2001 provides: "(1) Except as provided by this section, a court has no jurisdiction to grant relief or a remedy by way of: (a) a judgment or order in the nature of prohibition, mandamus, certiorari or other relief, or

(c) an injunction, in respect of any matter that has been heard and determined (or is to be heard or determined) by the Tribunal in accordance with this Act or in respect of any ruling, order or other proceeding relating to such a matter." 4 Section 65(3) however provides: "(3) A court is not prevented from granting relief or a remedy of a kind referred to in subsection (1) in relation to a matter in respect of which the Tribunal has made an order if the ground on which the relief or remedy is sought is that:

(a) the Tribunal had no jurisdiction to make the order, or

(b) in relation to the hearing or determination of the matter, a party had been denied procedural fairness." 5 Prerogative relief under s 65(3) of the Consumer, Trader and Tenancy Tribunal Act is discretionary and may be refused where there has been delay on the part of the applicant or it can be said that the applicant has waived or acquiesced in the validity of the decision (Italiano v Carbone [2005] NSWCA 177 per Basten JA at [117]; Maconachie v Kullenburg & Ors [2005] NSWCA 294 per McColl JA (Giles JA agreeing) at [59]). 6 Section 67 of the Consumer, Trader and Tenancy Tribunal Act allows for an appeal to be made to this court on a question with respect to a matter of law. A reference to a matter of law includes a reference to a matter relating to the jurisdiction of the Tribunal (s 67(8)). The onus lies on the plaintiff to demonstrate that there has been an error with respect to a matter of law. 7 Section 67(3) of the Consumer, Trader and Tenancy Tribunal Act provides that, after deciding the question of the subject of an appeal, the court may affirm the decision of the Tribunal, or it may make an order in relation to the proceedings in which the question arose as it, in its opinion, should have been made by the Tribunal, or it may remit its decision on the question to the Tribunal and order a rehearing of the proceedings before the Tribunal. 8 The width of s 67 was discussed in Chapman v Taylor & Ors; Vero Insurance Ltd v Taylor & Ors [2004] NSWCA 456. Hodgson JA (with whom Beazley and Tobias JJA agreed) stated succinctly [at para 33]: "… in my opinion, to establish an error of law by the Senior Member, it was necessary to show that he applied a wrong principle of law. That could be shown either from what he said, or because the ultimate result, associated with the facts that he expressly or impliedly found, indicates that he must have applied the wrong principle of law". 9 See also Kalokerinos & Anor v HIA Insurance Services P/L & Anor [2004] NSWCA 312 at paragraphs [39], [40], [41], [47] and [59].

The Tribunal generally 10 At the outset, it is helpful to set out some of the provisions of the Act. The functions of the Tribunal are to adjudicate disputes between consumers and commercial disputes between landlords and tenants. The Tribunal is not constrained by the rigour of the courtroom. Its objects are to ensure that the Tribunal is accessible, its proceedings are efficient and effective, its decisions are fair and to enable proceedings before the Tribunal to be determined in an informal, expeditious and inexpensive manner. The Tribunal 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 28). 11 Evidence must be given on oath or statutory declaration (s 39(1)) but the Tribunal is not bound by the rules or practice of evidence and the Tribunal may inform itself on any matter in such manner as it considers appropriate (s 28(2)). The Tribunal must conform to the rules of natural justice, but broadly speaking, has control of and responsibility for its own procedures (s 28(1) and (2)). Its business is conducted in public (s 33). Section 35 provides that the Tribunal must ensure that each party in any proceedings is given a reasonable opportunity to call or give evidence and otherwise present the party's case (whether at a hearing or otherwise); and to make submissions in relation to the issues in the proceedings. Normally, a party to the proceedings has carriage of his or her own case and is not entitled to be legally represented (s 36(1)). The Tribunal has the power to award costs (s 53), but usually each party bears its own costs. Pursuant to s 54 of the Act, the Tribunal is obliged to use its best endeavours to bring the parties to a settlement before making an order. The Tribunal has a power to correct its decision (s 50) and the Registrar can issue a certificate, which operates as a judgment to recover amounts ordered to be paid (s 51).

Grounds of Appeal 12 Mr Saad appeals the decision of Tribunal Member Durie on the basis that he did not give sufficient reasons for refusing the adjournment and amendment applications and proceeded to determine the application without a hearing on the merits; that the Tribunal took into account irrelevant considerations and failed to give appropriate weight to matters put by the Mr Saad's solicitor before allowing him to withdraw; and that the Tribunal allowed the Mr Saad's solicitor to withdraw from the proceedings without warning him that it proposed to order a fixed amount of costs, rather than making a costs order in respect of which the plaintiff would have been entitled to seek assessment.

The proceedings in the CTTT 13 Mr Kassis was the owner/builder of a dwelling. Mr Saad was the purchaser of the dwelling. Construction of the dwelling was completed in January 2002 and it was sold in January 2003. On 18 October 2006 the plaintiff filed an application in the home building division of the CTTT seeking payment of $163,794 for remedial and rectification work at the dwelling. There was a large sum in dispute. The hearing had been set down for two days on 12 and 13 July 2007. 14 On 10 July 2007, Mr Saad's solicitor faxed an adjournment request to the Tribunal on the basis of the very serious illness to one of the prospective witnesses, Mr Walker. Consideration of that request was deferred to the hearing. 15 On 12 July 2007 the application for adjournment was refused. The Tribunal Member ordered that the applicant pay the respondent's costs for the application, such costs, assessed by the Tribunal at $25,322.62, to be payable immediately.

The Tribunal Member's decision 16 It should be borne in mind that it was not until 7 August 2007 that the Tribunal Member prepared his reasons. They were prepared on the day he received the request. The proceedings had been sound recorded, but he had not had access to the recording. He did make notes at the hearing, but they had disappeared. The Tribunal member prepared his statement from his recollection of what was discussed at the hearing. His reasons remain those given orally at the hearing. The transcript of the proceedings in the Tribunal has since been obtained. It is of little assistance as it is replete with the word "indecipherable" followed by "…". It has become necessary to resort to the affidavit of Ms Sultana, s solicitor who was present at the hearing. She took notes. 17 At the hearing before the Tribunal on 12 July 2007 both parties were legally represented. The matter was listed for two days. 18 At the outset Mr Dlakic, the solicitor for Mr Saad, sought an adjournment of the hearing on the basis that Mr Phillip Walker, a witness retained on behalf of the plaintiff, was unable to attend the hearing due to medical reasons. Counsel for Mr Kassis opposed the adjournment and made robust submissions throughout the hearing as to why an adjournment ought not be granted. There was no dispute that Mr Walker was seriously ill and could not be expected to attend court. Mr Walker is the New South Wales manager for Dulux Powder and Industrial Coatings Division. Mr Walker had attended the dwelling and taken photographs. The letter dated 30 January 2007 was confined to the subject of pool fencing. He expressed his view that there was either an improper pre-treatment system applied to the pool fencing or none at all. 19 Counsel for Mr Kassis, Mr Davie submitted that firstly, the content of the letter was irrelevant to the proceedings before the Tribunal; secondly, that the photographs referred to in the letter had not been served; and thirdly, that the letter was not an expert report. 20 The Tribunal Member said words to the effect that the letter "…purely related to pool fencing. Nothing in the Scott schedule about pool fencing. There is no mention in the document of the windows at all. It solely relates to pool fencing." 21 Mr Davie then said words to the effect "The respondent has come here ready to deal with the claim as per the Scott schedule." Mr Dlakic then said words to the effect "Clearly there are problems with the report of Mr Walker. I would ask that given the size of the claim that these issues be addressed." 22 Ms Sultana recalled that Mr Dlakic was then given leave to contact the plaintiff and seek instructions. Mr Dlakic then returned and said words to the effect "I have spoken to my client. He is not very well. Hard to get a decision. Either amend the claim to include the compensation for the pool fencing as it is a very important issue to him. Amend the Scott schedule etc. Or if we proceed to hearing, I need to put certain things to witnesses. First hand knowledge. Can't instruct properly." 23 Mr Davie responded and said words to the effect "The applicant can and should be ready. There is no evidence that Mr Saad is poorly. Mr Walker's illness is conceded but there is no basis for an adjournment due to Mr Walker's illness."

24 In relation to Mr Walker, the Tribunal Member said "I was satisfied that Mr Walker's illness was such that he could not attend, and that had he been a relevant witness an adjournment would have been granted on terms. Mr Walker deserves considerable sympathy in his predicament. However, his evidence was limited to a matter not the subject of a claim before the Tribunal." This is clearly correct. 25 Details of the plaintiff's sickness were scant. The solicitor for the plaintiff, Mr Amil Dlakic had sworn an affidavit wherein he denies that Mr Saad gave him instructions that he was happy for the matter to proceed and that he informed the Tribunal Member of that matter. Mr Dlakic also denies that he said that Mr Saad was happy for the mater to proceed without any evidence from him. The Tribunal Member has recorded in his reasons that Mr Saad had told his solicitor that he was happy for the matter to proceed on the basis of the document he had presented. While it is true that there was no statement from Mr Saad the disputes were really disputes between expert builders. 26 The factors to be taken into account in considering whether to grant an adjournment are set out in State of Queensland v JL Holdings Pty Ltd (1997) 189 CLR 146; Sali v SPC Ltd (1993) 116 ALR 625; Thomas v Nedeljkovic [2004] NSWSC 524; and more recently in Menzies v CRCI Pty Ltd [2007] NSWCA 118 at [27] where the Court of Appeal stated:

"It was put that, in accordance with JL Holdings , the Court should grant an amendment, unless prejudice was caused to the other side that could not be met by an adjournment and costs, and that any prejudice in this case could have been so met. However, in my opinion, where an amendment would require vacation of a hearing date which was set to take place within a few days, generally there is prejudice through prolongation of the litigation that is not entirely met by costs, and the imposition of that prejudice on the other party needs to be justified by the strength of the case made for the indulgence by the party applying for it. I do not think this was made out in this case, for the reasons I have given, especially in circumstances where no explanation was given for not complying with the terms of the previous indulgence granted." 27 Tribunal Member Durie then refused the application for an adjournment. That decision was open to the Tribunal member. At this stage, there was no denial of procedural fairness. 28 The plaintiff's solicitor then made a further application for an adjournment on the basis of the non-availability of another expert, Mr Kavanagh who had completed the "Applicant's part of the Scott Schedule." Mr Dlakic denied that he said to the Tribunal Member that "Late the week before…advised…(me)…that he was not available for the hearing." Mr Dlakic also denied that he informed the Tribunal Member that Mr Kavanagh had advised him so the week before. In fact, Mr Dlakic says that he informed the Tribunal Member, that Mr Kavanagh had advised him on 11 July 2007 that he (Mr Kavanagh) was "on a job from 7 am to 7 pm and could not attend." It follows that if Mr Kavanagh had only advised Mr Dlakic on 11July 2007 (the day before the hearing) that he was not able to attend the hearing on the following day, there was not sufficient time to enable him to: "…still have sought the issue of a summons to attend with shortening of time." It may have been possible with the issue of the summons to have secured the attendance of Mr Kavanagh on the second day of the hearing. 29 The Tribunal Member then recorded that Mr Davie opposed this further application on the basis that this expert had not provided a report and that simply completion of the Scott Schedule did not amount to provision of a statement or report, and that there had been no compliance of Makita v Sprowles [2001] NSWSC 305. 30 The Tribunal Member refused this application for adjournment and stated that these matters should have been included in the original application. In relation to the further adjournment application, the Tribunal Member stated that while Mr Dlakic had properly notified the witness promptly of the hearing, and had been let down by the witness at a late stage he still could have sought the issue of a summons to attend with shortening of time and that Mr Dlakic's statement that he had expected the matter to be adjourned because of Mr Walker's illness was not sufficient. The Tribunal Member stated that the Makita v Sprowles point was well founded and strong in that there was no evidence from the witness showing what facts he had found, what assumptions he had made, nor how he had reached his conclusions, let alone his qualifications and awareness of the Chairperson's direction concerning expert witnesses. 31 The Tribunal Member referred to the decision of Duncan v Cliftonville Estates Pty Limited [2001] NSWSC 968; (2001) 10 BPR 19,127; (2002) NSWConvR 56-006 where Young J at [2] stated: "While dealing with this preliminary matter I should make the point that when the court makes directions for the filing of affidavits before a certain time, it means what it says, even in consent orders. Ordinarily, if material is not provided within the time limited by order, the court just does not consider it. There are occasions when the material can be received by consent, or where it would be appropriate to grant an adjournment with orders as to indemnity costs for the defaulter, but in many cases the rights and interests of the parties are only able to be dealt with by dealing with the matter at the trial in the light of the evidence which has been filed in accordance with the directions." 32 Mr Saad's solicitor withdrew. The Tribunal Member then determined the matter and awarded costs to Mr Kassis and fixed the sum at $25,322.62 which was ordered to be payable immediately. 33 The Scott Schedule is a specialised document used in building disputes. I accept that Mr Kavanagh, the author of the schedule, did not set out his qualifications in that document other than to say that he is a senior building consultant. He had reproduced the expert's declaration at the conclusion of the document but it had not been signed. In relation to methodology used Mr Kavanagh stated "With regard to the estimate of loss in this schedule, please note that costs are based on the experience of the author, estimates provided by experienced remedial Building Contractors together with reference to labour charge out rates shown for Tradesmen engaged in NSW as set out in the Cordell's Cost Guide published March 2004". Each item in dispute is set out and he has made detailed comments beside them. He has shown how he arrived at the reasonable costs of rectification in relation to each item. 34 Had Mr Kavanagh been available to give evidence, he could have produced his CV setting out his qualifications and he could have adopted the experts code of conduct. It seems that the Tribunal Member was under the misapprehension as to the actual date the solicitor was notified of Mr Kavanagh's intended non-appearance at the Tribunal. I accept that the solicitor only found out the night before the hearing was scheduled to commence. Hence, the plaintiff's solicitor would have been unable to secure Mr Kavanagh's attendance. He did not have enough time to issue a summons to compel Mr Kavanagh to be present at the hearing. I accept that the Tribunal had set aside two days to hear this matter but the prejudice to Mr Kassis could have in the circumstances been cured by costs. While this Court is reluctant to interfere with discretionary orders of the Tribunal, this is one case where in my view the discretion miscarried and as a result Mr Saad was denied of procedural fairness. 35 The appeal is upheld. The decision of Senior Tribunal Member Durie dated 12 July 2007 is set aside. The matter is remitted to the Tribunal to be determined according to law. 36 Costs are discretionary. Costs normally follow the event. The defendant is to pay the plaintiff's costs of the appeal. However, the plaintiff should pay the defendant's costs thrown away in the Tribunal on 12 and 13 July 2007. The defendant is to have a certificate under the Suitors' Fund Act if applicable.

(2) The decision of Senior Tribunal Member Durie dated 12 July 2007 is set aside.

(3) The matter is remitted to the Tribunal to be determined according to law.

(4) The defendant is to pay the plaintiff's costs of the appeal. However, the plaintiff should pay the defendant's costs thrown away in the Tribunal on 12 and 13 July 2007. The defendant is to have a certificate under the Suitors' Fund Act if applicable. **********

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