Sundollar Pty Ltd v Consumer Trader and Tenancy Tribunal of New South Wales

The defects assurance 15This is the first basis upon which it is said that there was a denial of procedural fairness. It is common ground that a denial of procedural fairness in Tribunal proceedings can be remedied by this court. Section 65 of the Consumer Trader and Tenancy Tribunal Act 2001 provides relevantly: "65 (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 (b) a declaratory judgment or order, 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. ... (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: ... (b) in relation to the hearing or determination of the matter, a party had been denied procedural fairness." 16For Sundollar, Mr Minehan relied upon a passage from the judgment of Gleeson CJ in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam [2003] HCA 6, 214 CLR 1. That was a case in which the applicant for relief complained of a denial of procedural fairness by the Minister in the cancellation of his visa. The outcome need not concern us. The passage relied upon by Mr Minehan was at [37], as follows: "A common form of detriment suffered where a decision-maker has failed to take a procedural step is loss of an opportunity to make representations. Attorney-General (Hong Kong) v Ng Yuen Shiu [[1983] 2 AC 629 at 638-639] was such a case. So, according to the majority, was Haoucher v Minister for Immigration and Ethnic Affairs [(1990) 169 CLR 648 at 655, 665, 684]. A particular example of such detriment is a case where the statement of intention has been relied upon and, acting on the faith of it, a person has refrained from putting material before a decision-maker. In a case of that particular kind, it is the existence of a subjective expectation, and reliance, that results in unfairness. Fairness is not an abstract concept. It is essentially practical. Whether one talks in terms of procedural fairness or natural justice, the concern of the law is to avoid practical injustice." 17Mr Minehan submitted that the statement of principle of the Chief Justice is applicable to the present case. The affidavit evidence of Mr Nielsen was that he considered a further inspection and report by Mr Reid to be "critical evidence if there was any doubt as to whether the swimming pool was structurally sound", but that he did not pursue that course in reliance on what the member had said during the inspection. 18Mr Minehan accepted that the structural integrity of the pool had been an issue from the outset of the proceedings, a fact which Mr Nielsen acknowledged in oral evidence in this court. Nevertheless, Mr Minehan pointed out that the expert evidence had been completed on the first day of the Tribunal hearing, 19 April 2012, and that 2 August had been set aside for receipt of the lay evidence. Yet very shortly before that day, Sundollar was confronted with photographs showing cracking in the pool, clearly intended to be used by Mr Bradshaw on the structural issue. Sundollar quickly garnered such expert evidence as it could on the basis of the photographs, but it was appropriate that it should be able to deal with this material with the opinion of an appropriately qualified expert, such as Mr Reid, who had had the advantage of inspecting the pool. 19In response for Mr Bradshaw, Mr Knowles submitted that in his decision the member did not make an unequivocal finding that the structural integrity of the pool had been compromised. In the passages in the decision to which I have referred at [13] and [14] above, the member said no more than the pool "may not be" structurally sound and that "questions would remain" about its structural integrity in the future. The true basis for the member's conclusion that the pool had to be demolished, Mr Knowles argued, was his finding that the deep end of the pool could not be lowered. 20Mr Knowles pointed out that cracking in the concrete was not a wholly new factor at the time the photographs were produced to Sundollar. In his report Mr Puvinayagam had noted minor cracks in the bottom slab. As I understand it, the photographs were said to depict further cracking. Mr Knowles also relied on affidavit evidence of Mr Bradshaw that at the inspection on 1 November those present agreed that the cracks were simply the result of concrete shrinkage and did not of themselves point to structural damage. Mr Nielsen confirmed this in cross-examination. Mr Knowles noted that in his reasons the member made no reference to cracks in the pool, conveying that they were not germane to his decision. 21In the event, Mr Knowles submitted, the issue of structural integrity had been dealt with in the evidence presented by both parties. The photographs did no more than reinforce the existing claim and, for whatever significance they might have had, they were met by the additional reports tendered by Sundollar on 2 August. He submitted that the member was not under an obligation "to afford every opportunity" to Sundollar to present its "best possible case and to improve upon the evidence", citing a passage in the judgment of Hayne, Kiefel and Bell JJ in Minister for Immigration v Li [2013] HCA 18, 249 CLR 332, at [82] (368). In the present case, he said, there has not been demonstrated the "practical injustice" to which Gleeson J referred in the passage from Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam cited above. 22I do not accept that the member made no finding on the issue of structural integrity. A fair reading of his reasons, in my view, conveys that he thought it likely that the rectification work undertaken by Sundollar had compromised the structural soundness of the pool, although the effects of that compromise were not yet apparent. In the passage from his reasons quoted at [14] above it does appear that the structural integrity of the pool was a factor in his decision that it had to be demolished. 23However, I am persuaded, for the reasons articulated by Mr Knowles, that the cracking in the pool was not a matter of significance in that finding. Having been raised by the photographs, it was dealt with by the additional reports which Sundollar obtained, and the agreement of those present on 1 November that the cracks were the result of concrete shrinkage conveys that they had ceased to be an issue. This may be how the member's observation at the inspection upon which Sundollar relies should be understood. Insofar as Mr Nielsen took that observation to mean that there was no longer a "structural issue" in the case at all, the fact is that that issue had been litigated and the only matter which might be seen to be outstanding was the significance of the cracks. 24I accept Mr Knowles' submission that the "defects assurance" did not work any practical injustice. Accordingly, this ground for relief has not been made out. 25I might add that, even if this ground had been made out, there is force in Mr Knowles' submission that relief should be refused in the exercise of the court's discretion on the basis that the asserted procedural unfairness did not affect the outcome. He relied upon the member's findings that the deep end of the pool was not deep enough, that this deficiency was in breach of the contract and of the statutory warranty, that it could not be repaired and that, because the depth was inherently dangerous, the pool had to be demolished. Those findings, Mr Knowles argued, were sufficient to support the member's decision. However, this is not a matter about which I need express a concluded view.

Representation 26The second basis upon which Sundollar contends that there was a denial of procedural fairness is that the member permitted Mr Bradshaw's partner, Bailey Maore (referred to in the proceedings as Bailey Bradshaw) and Mr Puvinayagam to participate as advocates in the presentation of Mr Bradshaw's case, so as effectively to represent him. As I have said, neither party was legally represented, which was in accordance with the Tribunal's practice. Indeed representation by any person is controlled by the Consumer, Trader and Tenancy Tribunal Act. Section 36 relevantly provides: 36 Representation of parties (1) Except as provided by this section, a party in any proceedings has the carriage of his or her own case and is not entitled to be represented by any person. (2) A party may, in accordance with the regulations, apply to the Tribunal for permission to be represented by a person in the proceedings or in part of the proceedings. The Tribunal may approve any such application and make an order permitting the party to be represented ... 27The relevant clauses of the Consumer, Trader and Tenancy Tribunal Regulation 2009 are as follows: 13 Application for Representation (1) For the purposes of section 36 (2) of the Act, an application by a party to the Tribunal for permission to be represented in any proceedings may be made: (a) in writing addressed to the Registrar and lodged before the date set down for hearing of the proceedings, or (b) by oral submission at the commencement of the hearing. ... (4) An application for permission to be represented cannot be determined by the Tribunal unless each other party to the proceedings has been given an opportunity to make oral or written submissions in relation to the application. ... 14 Circumstances in which application may be made (1) For the purposes of section 36 (2) of the Act, an application by a party for permission to be represented in any proceedings may be made in any one or more of the following circumstances only: (a) if the proceedings are to be heard in the Home Building Division and involve a claim or dispute for an amount exceeding $30,000, (b) if the party is a body corporate and the body corporate is to be represented by one of its officers, ... (q) if the Tribunal is of the opinion that the party would be placed at a disadvantage if not represented at the hearing, (r) if the Tribunal is of the opinion that representation should be permitted as a matter of necessity due to the likelihood that complex issues of law or fact will arise in the proceedings. ... 15 Representative to be competent (1) In dealing with an application for the representation of a party in any proceedings, the Tribunal must not approve the application unless it is satisfied that the representative: (a) has sufficient knowledge of the issues in dispute to enable the representative to represent the applicant effectively at the hearing by the Tribunal of the matter concerned, and (b) is vested with sufficient authority to bind the applicant. ... 28It will be seen from these provisions that representation is not a benefit conferred for the asking. Mr Minehan cited the decision of Flick J in Warrell v Walton [2013] FCA 291, in which his Honour considered the provision for representation of parties by lawyers in Fair Work Australia proceedings provided by s 596 of the Fair Work Act 2009 (Cth). That section is somewhat similar to the CTTT provisions, requiring permission for a party to be represented and, by subs (2), setting out certain criteria to be met before permission can be granted. That subsection provides: "(2) FWA may grant permission for a person to be represented by a lawyer or paid agent in a matter before FWA only if: (a) it would enable the matter to be dealt with more efficiently, taking into account the complexity of the matter; or (b) it would be unfair not to allow the person to be represented because the person is unable to represent himself, herself or itself effectively; or (c) it would be unfair not to allow the person to be represented taking into account fairness between the person and other persons in the same matter." 29At [24] Flick J said this about that provision: "A decision to grant or refuse 'permission' for a party to be represented by 'a lawyer' pursuant to s 596 cannot be properly characterised as a mere procedural decision. It is a decision which may fundamentally change the dynamics and manner in which a hearing is conducted. It is apparent from the very terms of s 596 that a party 'in a matter before FWA' must normally appear on his own behalf. That normal position may only be departed from where an application for permission has been made and resolved in accordance with law, namely where only one or other of the requirements imposed by s 596(2) have been taken into account and considered. The constraints imposed by s 596(2) upon the discretionary power to grant permission reinforce the legislative intent that the granting of permission is far from a mere 'formal' act to be acceded to upon the mere making of a request." 30Bailey Bradshaw participated in the presentation of Mr Bradshaw's case from the outset, including the directions hearing in January 2012. On the first day of hearing, 19 April, she made comments and statements by way of argument, and she participated in the examination of Mr Puvinayagam and the questioning of Mr Aungle. 31On the second day, 2 August, she involved herself in preliminary discussion with the member and in the questioning of the lay witnesses upon whom Sundollar relied: Richard Nielsen, and his brother, Michael Nielsen and Steven Ferguson, both of whom worked for Sundollar. As I have said, Mr Puvinayagam was present on that occasion and he involved himself in a similar way, behaving as an advocate rather than as an independent witness. He also participated in the preliminary discussion, and made observations in support of Mr Bradshaw's case during the hearing that day. He took part in the cross-examination of Richard Nielsen and Michael Nielsen, sometimes in tandem with Bailey Bradshaw. On one occasion Mr Puvinayagam accused Richard Nielsen of lying. Towards the end of his evidence Mr Puvinayagam made the comment that Mr Aungle was "designed ... to bring confusion and he has done that very well," and that observation was adopted by Bailey Bradshaw. 32At no stage, either during the hearing or before it, was an application made for Bailey Bradshaw or Mr Puvinayagam to represent Mr Bradshaw. It would, of course, have been entirely inappropriate for Mr Puvinayagam to be allowed to play that role, which would be inconsistent with his status as an expert witness. Mr Minehan submitted that the member should have informed the parties of the need for Mr Bradshaw to seek permission to be represented, of which they were most likely unaware, so that the matter could be considered in the light of the statutory requirements and Sundollar could have been heard on it. 33I should add that Richard Nielsen himself did not at any stage seek permission to represent Sundollar: cl 14(1)(b) of the Regulation. However, the company had to be represented by someone and, presumably, permission would have been forthcoming. It should also be pointed out that on 19 April, when the expert evidence was taken, Mr Puvinayagam and Mr Aungle questioned each other to a considerable extent, in what Mr Minehan described as a "shambolic ... hot tub." He made no complaint about that in this court. His focus was upon the hearing on 2 August. 34Mr Minehan submitted that the participation in the proceedings of Bailey Bradshaw and Mr Puvinayagam, permitted by the member without regard to the statutory criteria, worked significant unfairness to Sundollar. Particularly was that so of Mr Puvinayagam, whose performance as an advocate was entirely inconsistent with his role as an expert. The Tribunal has an expert witness code of conduct, similar to those familiar in the courts. In particular, cl 2 sets out the general duties of an expert witness to the Tribunal, providing that the witness "has an overriding duty to assist the Tribunal impartially", that the witness's "paramount duty is to the Tribunal and not to the parties", and that the witness "is not an advocate for any party." Moreover, Mr Minehan submitted, Mr Puvinayagam was able to bring the weight of his expertise to his advocacy, both in observations to the member about the merit of Mr Bradshaw's case and in the questioning of the lay witnesses. 35As to the cross-examination of Richard and Michael Nielsen by both Bailey Bradshaw and Mr Puvinayagam, sometimes in tandem, Mr Mineham relied upon authority that generally a witness in court proceedings can be cross-examined by only one counsel representing a party: the decision of Allen J in Phillips v Phillips [1966] 1 NSWR 49, and that of Young J in GPI Leisure Corp Ltd v Herdsman Investments Pty Ltd (No 3) (1990) 20 NSWLR 15, especially at 21, 22-3. He noted that the member himself became concerned about the process. At one stage, during the evidence of Richard Nielsen, after an episode of questioning in tandem, the member said, "Please, stop, stop, stop. Please, no." At another stage in Richard Nielsen's evidence, apparently when Mr Bradshaw himself sought to raise something, the member said: "Oh please, please - not three cross-examiners. This is just completely unfair. I've given a bit of latitude here, but you know, I'm not turning this into a Royal Commission into the building of a pool." 36Mr Minehan submitted that the outcome of the proceedings, principally based on Mr Puvinayagam's evidence, demonstrated the "practical unfairness of the process." After considering the conflict in the expert evidence presented on both sides, both as to the depth of the pool and its structural soundness, the member said in his reasons: "I prefer the evidence of Mr Puvinayagam to that of Mr Aungle and Mr Grohs. I have the impression that the evidence of Mr Aungle and Mr Grohs seeks to defend the respondent's case rather than assist with an objective assessment of the problems with this pool and possible remedies. I accept Mr Puvinayagam's evidence that the pool may not be structurally sound." Mr Minehan pointed out that the member arrived at that conclusion after observing the participation of Mr Puvinayagam not just as an expert witness, but also as an advocate. 37He noted the result in Warrell v Walton, while acknowledging the factual differences between that case and this. Flick J held that a Senior Deputy President of Fair Work Australia had fallen into error in allowing an employer company to be represented by a solicitor without addressing the criteria in s 596(2) of the Fair Work Act, in proceedings in which the employee, Mr Warrell, was unrepresented. Mr Warrell suffered brain damage and was functionally illiterate. The advantage the employer had over Mr Warrell in the conduct of the proceedings was obvious. Flick J observed at [26] that the nature of the issues to be resolved and the difficulties confronting Mr Warrell were such that it was "not self evident" that the employer "could readily have satisfied one or other" of the constraints in s 596(2). Accordingly, his Honour concluded, the hearing was not "fair and just", as required by s 577(a) of the Fair Work Act. 38This ground has troubled me, particularly insofar as it relates to the conduct of Mr Puvinayagam. Nevertheless, I am persuaded by the submissions of Mr Knowles that here also a denial of procedural fairness has not been established. 39The proceedings were certainly conducted in an informal way, and Mr Knowles accepted that Bailey Bradshaw and Mr Puvinayagam "played an active role" in them. He also accepted that the member did not expressly make an order under s 36 permitting Mr Bradshaw to be represented. However, he relied upon s 32(3) of the Act, which provides: "If a provision of this Act or the Regulations is not complied with in relation to the commencement or conduct of proceedings, the failure to comply is not to be treated as an irregularity and does not nullify the proceedings or any decision in the proceedings unless the Tribunal otherwise determines." 40Mr Knowles also referred to s 28(3), which provides: "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." That, of course, is not to deny the requirement of the Tribunal to ensure procedural fairness. I have referred above to the remedy available in this court for procedural unfairness preserved by s 65(3)(b). In addition, s 28(2) provides: "The Tribunal is not bound by the rules of evidence and may enquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of procedural fairness." 41Aside from the failure of Sundollar to seek permission for Richard Nielsen to represent it, Mr Knowles noted that no such permission was sought also in respect of Mr Aungle, who had effectively assumed the role of advocate for Sundollar in cross-examining Mr Puvinayagam on 19 April. At one stage, in what I understand to have been a dispute between the two experts as to the length of a crack in the pool, Mr Aungle described Mr Puvinayagam's measurement as "a ridiculous statement." At another stage, he described Mr Puvinayagam's evidence about whether the pool was deep enough for safe entry as "a complete red herring." Mr Aungle was not present on 2 August to adopt the role of advocate in opposition to Mr Puvinayagam but, Mr Knowles pointed out, that was not because he was prevented from doing so by the member. Apparently, Sundollar did not arrange for him to attend. 42Mr Knowles also took the point that Sundollar had not objected to Mr Bradshaw being represented by his partner and Mr Puvinayagam. However, I do not consider that to be a matter of significance because, as I have said, the parties were probably unaware of the statutory requirements for representation. However, there is force in his argument that the manner in which the case was dealt with on the two hearing days was consistent with the informality with which the proceedings were conducted by both parties. 43The way in which Richard and Michael Nielsen were cross-examined by both Bailey Bradshaw and Mr Puvinayagam should also be viewed in the light of that informal approach. As Mr Knowles pointed out, Phillips v Phillips and GPI Leisure v Herdsman Investments were cases dealing with curial proceedings and, even in that context, the decisions recognised that the general rule that a witness be cross-examined by only one counsel representing a party is not inflexible and is a matter within a court's discretion. The protests by the member during Richard Nielsen's evidence, referred to at [34] above, do not demonstrate that procedural fairness had been compromised. Rather, they convey that the member, having allowed considerable latitude, sought to control the process (and maintain focus on the real issues) in the interests of fairness. 44Undoubtedly, the requirements for representation should have been raised with the parties and observed. In particular, it was inappropriate for Mr Puvinayagam to adopt the role of advocate, just as it was for Mr Aungle to the extent that he did. However, in all the circumstances of the case, I am not persuaded that the course of the proceedings demonstrates a denial of procedural fairness. Here also, there was no practical injustice. 45In submitting that procedural unfairness was demonstrated by the member's preference for the evidence of Mr Puvinayagam over that of the experts engaged by Sundollar, Mr Minehan explained that he was not seeking in this court to challenge the merits of the Tribunal's findings. Rather, he said, the favourable finding about Mr Puvinayagam's evidence demonstrated the practical unfairness of the prominent role which that expert was allowed to adopt as an advocate. As he put it in written submissions, he very likely impressed the member "but for all the wrong reasons." 46That is not an inference which could fairly be drawn. A satisfactory reason for the member's preference for the evidence of Mr Puvinayagam emerges from his finding in respect of the important issue of the pool depth. The member rejected the evidence of Mr Aungle and Mr Grohs that those depths complied with the design, saying that that assertion was "clearly wrong." He then particularised some aspects of the construction of the pool which he found not to be in compliance with the contract, and observed that Mr Bradshaw had "made and recorded precise measurements" and that his own site inspection had "confirmed the accuracy of these measurements." 47I have no reason to believe that the member's "impression" that Mr Aungle and Mr Grohs lacked objectivity and sought to defend Mr Bradshaw's case was anything other than an assessment of their evidence within his adjudicative function. The member had the reports of both those experts, together with the advantage of seeing and hearing Mr Aungle. Mr Grohs, of course, did not give oral evidence. However, his report contained something of a testimonial for Sundollar which was hardly appropriate from an independent expert. He wrote: "Sundollar Pools are a very well established swimming pool construction Company and I would be very surprised if they carried out these repairs in a way that would compromise the pool's structural stability given the fact that they have to provide a 6 year guarantee." 48Obviously, the facts of this case are very different from those in Warrell v Walton. In that case an unrepresented litigant, suffering intellectual defects, was pitted against a corporate opponent represented by a lawyer. There was no inequality of that kind in the present case. The way in which the matter proceeded was unconventional, but both parties had full opportunity to present their cases. This ground for relief also has not been made out. 49Accordingly, the amended summons is dismissed. If necessary, I shall hear the parties on costs.

Amendments 16 October 2014 - Case name amended Amended paragraphs: Coversheet 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: 13 October 2014