Smith v The Owners - Strata Plan No. 43094 - [2024] NSWCATAP 186 - NSWCATAP 2024 case summary

NCAT Appeal Panel|2024-08-08

The application to admit new evidence.

In order to rely on the new evidence on appeal the Smiths require permission (leave) from the Appeal Panel to do so.
Mrs Smith's diary notes concerning discussions about the alterations to the common property, which she says she wishes to rely on, were clearly made before the April 2024 hearing. It cannot be said that they were not reasonably available at that time. In those circumstances, leave to rely on diary notes is refused.
The scanned financial records of the OSP, which the Smiths emailed to the appeal registry on the morning of the appeal hearing, consist of financial records of the OSP from 2017 to the date of the appeal hearing. Only the most recent records, made after the decision, are truly new evidence that has arisen since the hearing. How financial records of the OSP, whether created before or after the hearing, are relevant to the issues on appeal is not apparent. The Smiths made no explanation of its relevance. The balance of the records is material that could reasonably have been obtained prior to the hearing. Additionally, there is no explanation of how that material is said to be relevant to the issues on appeal.
We decline to admit those financial records because: 1. They are not relevant to the issues we have to determine on appeal. 2. The vast majority of them could reasonably have been obtained prior to the hearing in April 2024.

Was the decision against the weight of the evidence?

The Smiths take issue with the Tribunal's factual conclusions in accepting the evidence presented by the OSP, and finding that their evidence was insufficient to demonstrate that they had agreement from the other lot owners for the works to proceed. This misstates the conclusion reached by the Tribunal. The Senior Member found that they, "did not adduce any evidence of the applicable general meeting of OSP43940 in which authorisation was given."
For the OSP to succeed in its claim, it had to demonstrate that the Smiths were not authorised to undertake the works in accordance with s 111 of the SSMA. In the circumstances, this required that the OSP show that the Smiths did not have the "approval of the owners corporation given by special resolution" for the works. This, in turn, required that the special resolution be passed at a properly constituted and minuted general meeting, with no more than a quarter of lots voting against the resolution.
What individuals may have said to the Smiths about the proposed works did not prove authorisation of the works. To demonstrate approval what was needed was evidence of compliance with s 111. That is why the Tribunal, when considering the Smiths evidence, focussed on the special resolution of 27 February 2021. This did not contain an authorisation for the Smiths to carry out work on the common property.
The evidence relied on by the OSP went to show that there had been no authorisation of the works undertaken by the Smiths. In her submissions, Mrs Smith suggested that some of this evidence was untrue. The best evidence to demonstrate that it was untrue would be authorisations under s 111 of the SSMA allowing the Smiths to undertake works on the common property. No such evidence was produced. The conclusion reached by the Tribunal, with respect to whether or not works were authorised, was one that accorded with the weight of the evidence before it. It was not against the weight of the evidence.
It was open to the Tribunal in those circumstances to make the removal and restoration orders.
We are not satisfied that the Smiths may have suffered a substantial miscarriage of justice because the decision of the Tribunal was against the weight of the evidence.

Was the decision not fair and equitable?

In submissions, the Smiths have not pointed to any failure by the Tribunal to afford them procedural fairness, or any conduct of the Tribunal in the hearing which put them at a disadvantage or was unfair.
They do point to the fact that the Tribunal did not summarise all their evidence in the decision, suggesting that the Senior Member did not have regard to it. The reality is that the various discussions they relied on to demonstrate authorisation of the works, did not satisfy the requirements of s 111 of the SSMA. Those discussions were not probative when it came to the question of whether the works were authorised. The Tribunal is not obliged to summarise or outline irrelevant evidence and material. What the Tribunal looked for and focussed on was evidence of a special resolution of the OSP authorising the works. It did not find any such evidence. There was none proffered by the Smiths. The OSP denied the existence of a special resolution approving the works. Their defence was therefore destined to fail.
In those circumstances, we do not accept that the decision was not fair and equitable.
Additionally, we note that Smiths have suggested that there was some unfairness in allowing the orders made by the Tribunal to stand when they have sold the business (as modified by the works), but retain the freehold. The unfairness is said to be to the Smiths and their purchaser.
This sale took place after the initial proceedings were commenced and was known to be in progress by the Tribunal, which did not consider it relevant. We agree that the impact an order for the removal of the works and restoration of the common property, would have on the contractual relations between the Smiths and their purchaser, was not a relevant factor to be considered by the Tribunal. It is a matter between them. There is no unfairness arising from the Tribunal's consideration of that relationship.

Conclusion on the granting of leave.

For the reasons outlined above, we will refuse leave to appeal.
We add, that were we satisfied that the decision was against the weight of the evidence or was not fair and equitable, we would nonetheless refuse the Smiths leave to appeal. This is not a case where there is a clear injustice flowing from the Tribunal's fact finding processes. There is no issue of principle, question of public importance, or matter relating to administration or policy that arises in the appeal.

Ending the stay.

The stay order will cease to have effect on publication of our decision. When the stay is lifted, the time for completion of the works ordered by the Tribunal will have passed. We therefore propose to make a further order extending the times specified by the Tribunal in its orders of 15 April 2024 so that the time allowed for compliance models those in the original order.
The Appeal Panel makes the following order: 1. Leave to appeal is refused. 2. The appeal is dismissed. 3. Time for compliance with the orders made by the Tribunal on 15 April 2024 is extended so that the time for compliance with: 1. order (1)(a) is now 30 October 2024; 2. order (1)(b) is now 30 December 2024; 3. order 2 - time to renew - is now 30 December 2024.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 30 September 2024

Strata Scheme Management Act 2015(NSW)

Scope and nature of internal appeals

Internal appeals may be made as of right on a question of law, and otherwise with leave (that is, the permission) of the Appeal Panel: s 80(2) of the Civil and Administrative Tribunal Act 2013 (the NCAT Act).
A question of law may include not only an error in ascertaining the legal principle, or in applying it to the facts of the case, but also taking into account an irrelevant consideration or not having regard to a relevant consideration. This includes not making a finding on an element or central issue that is required to be made out in order to claim an entitlement to relief: see CEO of Customs v AMI Toyota Ltd (2000) 102 FCR 578 (Full Fed Ct), [2000] FCA 1343 at [45], applying the statement of principle in Craig v The State of South Australia (1995) 184 CLR 163 at 179.
In John Prendergast & Vanessa Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69 (Prendergast) the Appeal Panel, at [13], set out a series of common questions of law: 1. Whether there has been a failure to provide proper reasons. 2. Whether the Tribunal identified the wrong issue or asked the wrong question. 3. Whether a wrong principle of law had been applied. 4. Whether there was a failure to afford procedural fairness. 5. Whether the Tribunal failed to take into account relevant (i.e., mandatory) considerations. 6. Whether the Tribunal took into account an irrelevant consideration. 7. Whether there was no evidence to support a finding of fact. 8. Whether the decision is so unreasonable that no reasonable decision-maker would make it.
The circumstances in which an Appeal Panel may grant leave to appeal from decisions made in the CCD are limited to those set out in cl 12(1) of Sch 4 of the NCAT Act. In such cases, the Appeal Panel must be satisfied that the appellant may have suffered a substantial miscarriage of justice on the basis that: "(a) the decision of the Tribunal under appeal was not fair and equitable; or (b) the decision of the Tribunal under appeal was against the weight of evidence; or (c) significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with)."
This provision was discussed in detail by the Appeal Panel in Collins v Urban [2014] NSWCATAP 17 (Collins)in which the Appeal Panel concluded that - Accordingly, it should be accepted that a substantial miscarriage of justice may have been suffered because of any of the circumstances referred to in cl 12(1)(a), (b) or (c) where there was a "significant possibility" or a "chance which was fairly open" that a different and more favourable result would have been achieved for the appellant had the relevant circumstance in para (a) or (b) not occurred or if the fresh evidence under para (c) had been before the Tribunal at first instance. As to the particular grounds in cl 12(1)(a) and (b), without seeking to be exhaustive in any way, the authorities establish that: 1. If there has been a denial of procedural fairness the decision under appeal can be said to have been "not fair and equitable" - Hutchings v CTTT [2008] NSWSC 717 at [35], Atkinson v Crowley [2011] NSWCA 194 at [12]. 2. The decision under appeal can be said to be "against the weight of evidence" (which is an expression also used to describe a ground upon which a jury verdict can be set aside) where the evidence in its totality preponderates so strongly against the conclusion found by the tribunal at first instance that it can be said that the conclusion was not one that a reasonable tribunal member could reach - Calin v The Greater Union Organisation Pty Ltd (1991) 173 CLR 33 at 41-42, Mainteck Services Pty Limited v Stein Heurtey SA [2013] NSWSC 266 at [153]. If in either of those circumstances the appellant may have been deprived of a "significant possibility" or a "chance which was fairly open" that a different and more favourable result would have been achieved then the Appeal Panel may be satisfied that the appellant may have suffered a substantial miscarriage of justice because the decision was not fair and equitable or because the decision was against the weight of the evidence. In order to show that a party has been deprived of a "significant possibility" or a "chance which was fairly open" of achieving a different and more favourable result because of one of the circumstances referred to in cl 12(1)(a), (b) or (c), it will be generally be necessary for the party to explain what its case would have been and show that it was fairly arguable. If the party fails to do this, even if there has been a denial of procedural fairness, the Appeal Panel may conclude that it is not satisfied that any substantial miscarriage of justice may have occurred - see the general discussion in Kyriakou v Long [2013] NSWSC 1890 at [32] ff concerning the corresponding provisions of s 68 of the CTTT Act and especially at [46] and [55].
The test of whether evidence is reasonably available is not considered by reference to any subjective explanation from the party seeking leave but, rather, by applying an objective test which asks whether the evidence in question was unavailable because no person could have reasonably obtained it: Al-Daouk v Mr Pine Pty Ltd t/as Furnco Bankstown [2015] NSWCATAP 111 at [23]; see too Elsayed v Tassone [2022] NSWCATAP 69 at [18].
Even if an appellant from a decision of the CCD has satisfied the requirements of cl 12(1) of Sch 4, the Appeal Panel must still consider whether it should exercise its discretion to grant leave to appeal under s 80(2)(b). In Collins, at [84], the Appeal Panel said that ordinarily it is appropriate to grant leave to appeal only in matters that involve: "(a) issues of principle; (b) questions of public importance or matters of administration or policy which might have general application; or (c) an injustice which is reasonably clear, in the sense of going beyond merely what is arguable, or an error that is plain and readily apparent which is central to the Tribunal's decision and not merely peripheral, so that it would be unjust to allow the finding to stand; (d) a factual error that was unreasonably arrived at and clearly mistaken; or (e) the Tribunal having gone about the fact finding process in such an unorthodox manner or in such a way that it was likely to produce an unfair result so that it would be in the interests of justice for it to be reviewed."
In the NCAT Act, s 81 deals with the determination of internal appeals. "(1) In determining an internal appeal, the Appeal Panel may make such orders as it considers appropriate in light of its decision on the appeal, including (but not limited to) orders that provide for any one or more of the following - (a) the appeal to be allowed or dismissed, (b) the decision under appeal to be confirmed, affirmed or varied, (c) the decision under appeal to be quashed or set aside, (d) the decision under appeal to be quashed or set aside and for another decision to be substituted for it, (e) the whole or any part of the case to be reconsidered by the Tribunal, either with or without further evidence, in accordance with the directions of the Appeal Panel. (2) The Appeal Panel may exercise all the functions that are conferred or imposed by this Act or other legislation on the Tribunal at first instance when confirming, affirming or varying, or making a decision in substitution for, the decision under appeal and may exercise such functions on grounds other than those relied upon at first instance."
In circumstances where an appellant is not legally represented, the Tribunal should look at the grounds of appeal generally in order to determine whether a question of law has in fact been raised, but must ensure that procedural fairness is given to the respondent before considering it: Prendergast at [12]. In Cominos v Di Rico [2016] NSWCATAP 5, the Appeal Panel explained at [13]: "13. It may be difficult for self-represented appellants to clearly express their grounds of appeal. In such circumstances and having regard to the guiding principle, it is appropriate for the Appeal Panel to review an appellant's stated grounds of appeal, the material provided, and the decision of the Tribunal at first instance to examine whether it is possible to discern grounds that may either raise a question of law or a basis for leave to appeal. The Appeal Panel has taken such an approach in a number of cases, for instance, Khan v Kang [2014] NSWCATAP 48 and Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69. However, this must be balanced against the obligation to act fairly and impartially (Bauskis v Liew [2013] NSWCA 297 at [68] citing Hamod v State of New South Wales [2011] NSWCA 367 at [309]- [316]). Relevantly, s 38(2) provides that that Tribunal "may inquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of natural justice."
Importantly, in Ryan v BKB Motor Vehicle Repairs Pty Ltd [2017] NSWCATAP 39 an Appeal Panel stated at [10]: "An appeal does not provide a losing party with the opportunity to run their case again except in the narrow circumstances which we have described. Mr Ryan has not satisfied us that those circumstances apply to his case and we refuse permission for him to appeal."

Smith v The Owners - Strata Plan No. 43094

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Judgment (7 paragraphs)

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Cases Cited (17)

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