Thelfro v Merbron Pty Ltd t/as Burraneer Bay Marina

History of dispute

1. The vendor of the boat was Mr Steve Oliver ("the vendor") who engaged the respondent ("the agent") to act as his marine broker to sell a boat. Those services were provided pursuant to a document entitled "Brokerage Deed", dated 14 October 2016. The boat was a Mustang 2800 with a MerCruiser engine ("the boat").
2. As part of the services provided pursuant to the Brokerage Deed, the agent apparently had advertised the boat for sale on its website. The agent was approached by the appellants to purchase the boat, and represented the vendor in negotiations concerning the boat's sale. It was common ground in this appeal that, at all times, the agent was acting as agent for the vendor, and that the identity of the vendor was disclosed to the appellants.
3. The appellants say the boat was advertised on terms that the engine had been replaced in 2013.
4. On about 29 November 2016, the appellant entered into a contract with the vendor to purchase his boat for $42,000. The completion date for the contract was specified, in a document entitled "Offer To Purchase", as being "after test drive". The purchase was completed and the appellants became owners of the boat.
5. The appellants claim that the engine subsequently failed and required repairs, at which point they discovered that the engine was not in fact replaced in 2013. They assert that "the engine was not a new engine in 2013 as advertised", that the "boat still has the original 2001 engine", and that by reason of the age of the engine "the cost and ability to repair the engine, as well as availability of parts, has resulted in exceptionally excessive costs that would not be incurred if the engine had in fact been replaced in 2013": see application MV 18/15583 filed in the Tribunal ("the original application").
6. The original application was lodged by the appellant online on 4 April 2018. In the section entitled "Application Details", the nature of the dispute was described as a motor vehicle claim for "Defective/Faulty Used Cars". Clearly, the appellants used the wrong electronic form; the section entitled "Reasons for the Orders" indicating that the claim was in respect of a boat.
7. In the original application, the appellants sought an order against the agent, rather than against the vendor, for an amount of $30,000. It would appear that the claim is said to arise from the boat being "advertised as having a new engine in 2013".
8. On 9 July 2018, the Tribunal dismissed the application because the "Tribunal has no jurisdiction to determine the application". The Tribunal provided written reasons for decision ("the reasons").
9. In its reasons, the Tribunal identified the claims being made as follows: a) misleading and deceptive conduct in trade or commerce: section 18 of the ACL; and b) making false or misleading representations in connection with the supply of goods: section 29 of the ACL.
10. The Tribunal dismissed the application for the following reasons: The Commercial and Consumer Division (sic) does have jurisdiction to hear and determine applications relating to consumer claims pursuant to Part 6A of the 1987 Act but in this matter, no evidence has been put forward by the [appellant's] which demonstrates that there was the supply of goods or services by the [agent] to the [appellants] in the course of carrying on a business; section 79E, 79F and 79G of the 1987 Act. The [agent] is acting as an agent of Mr Oliver. They are supplying him with agency services, not the [appellants]. The [appellants] were aware that the [agent] was acting as an agent and this is demonstrated by: (a) the "Offer to Purchase: item A 11 of the [agent's] documents, signed by the [appellants] which makes reference to the Vendor who is other than the [agent]; and (b) the e-mails to the [agent] of 28 November 2016 3:37 PM and 29 November 2016 12:44 PM which make reference to a vendor. Moreover, even though not relevant to determine this matter, a consumer claim cannot be brought against Mr Oliver by the [appellants] because he did not sell [the boat] in the course of carrying on a business.
11. The appellants appealed the Tribunal's decision by Notice of Appeal filed 6 August 2018. The appeal was lodged in time.
12. The appellants contended that the claim is a consumer claim within the meaning of Part 79E of the Fair Trading Act 1987 (NSW) ("FT Act"). Further, the appellants contended that the agent had made false and misleading representations to the appellants in connection with the supply of goods or services, which resulted in them suffering loss and damage. The appellants say that the agent "cannot rely on any agency disclaimer or claimed lack of warranty when making false or misleading representations or can they contract out of their own negligence".
13. The agent filed a Reply to Appeal dated 15 August 2018. Aside from asserting that no statements made by it were false or misleading, the agent's substantive point was that the Tribunal was correct in concluding that, while acting as agent for the vendor, it did not supply goods or services to the appellants, and therefore the Tribunal was correct to dismiss the claim for lack of jurisdiction.
14. At the hearing of the appeal, the appellants were represented by Ms Blake (one of the appellants). The agent was represented by its director, Mr Felgate.
15. Both parties agreed that the issue for determination in the appeal was whether the Tribunal was correct to determine that it lacked jurisdiction under the FT Act to hear this claim. They also agreed that if the Tribunal did in fact have jurisdiction to hear a claim by the appellants against the agent, then the matter needed to be remitted for rehearing by the Tribunal because the parties had not had an opportunity to present relevant evidence on the issue of liability and damages at the original hearing.
16. As to the submissions concerning jurisdiction, the appellants contended in oral submissions that: 1. there was a collateral contract between them and the agent; or 2. there was a direct or indirect supply of services by the agent to them in the form of the advertisement and other communications which the agent made on behalf of the vendor.
17. When asked to identify the nature of the collateral contract, and the consideration provided, the appellants said that it arose from their reliance on the advertisement, provided by the agent, and by the fact that they entered into a contract with the vendor.
18. Otherwise, the appellants asserted that they relied on the advertisement and what they were told by the agent when they asked if the engine was new. Further, the appellants said that, insofar as there had been a misrepresentation, the agent could not "contract out" of the Australian Consumer Law (NSW) (ACL).

Consideration

1. This appeal raises a question of law. Consequently there is a right of appeal: see s 80(2)(b) of the Civil and Administrative Tribunal Act 2013 (NSW) ("NCAT Act").
2. The question to be resolved is whether the appellants' claim - that is, a claim by a purchaser against the agent of a vendor, for misleading and deceptive conduct or misrepresentation when acting on a vendor's behalf - is a consumer claim within the meaning of the FT Act. This question also involves a consideration of whether, on the proper construction of the FT Act, there is a relevant supply of services by the agent (as a supplier of goods or services) to a purchaser (as a consumer), in circumstances where the agent is engaged by the vendor to provide advertising services, and to represent its principal in negotiations concerning the sale of a boat to the purchaser, and is paid by the vendor for such services.
3. Pursuant to s 79J of the FT Act, the Tribunal has jurisdiction to hear and determine a consumer claim.
4. Section 79E defines a consumer claim as follows: 79E Meaning of "consumer claim" (cf CC Act 1998, s 3A) (1) For the purposes of this Part, a consumer claim means a claim by a consumer, for one or more of the following remedies, that arises from a supply of goods or services by a supplier to the consumer (whether or not under a contract) or that arises under a contract that is collateral to a contract for the supply of goods or services: (a) the payment of a specified sum of money, (b) the supply of specified services, (c) relief from payment of a specified sum of money, (d) the delivery, return or replacement of specified goods or goods of a specified description.
5. As that section makes clear, there must be a claim by a consumer "that arises from the supply of goods and services by a supplier to the consumer (whether or not under a contract)".
6. In the present case, the applicants were consumers as they are both natural persons: see s 79D of the FT Act.
7. The expression "supply" is defined by way of an inclusive definition in s 79G of the FT Act as follows: 79G Meaning of "supply" (cf CC Act 1998, s 3 (1) (definition of "supply") and s 3 (2)) … (2) For the purposes of this Part, a reference to the supply of services includes a reference to any of the following: (a) providing, granting or rendering services for valuable consideration, (b) agreeing to supply services, (c) supplying services together with goods
8. As provided by s 79F of the FT Act, "services" is a reference to the following: (a) the performance of work (including work of a professional nature), whether with or without the supply of goods, (b) the provision of gas or electricity or the provision of any other form of energy, (c) the provision, or the making available for use, of facilities for amusement, entertainment, recreation or instruction, (d) the letting of premises for vacation or recreational purposes, (e) the conferring of rights, benefits or privileges for which remuneration is payable in the form of a royalty, tribute, levy or similar exaction, (f) the provision of insurance cover, (g) the rights or benefits provided, granted or conferred under a contract between a banker and a customer of the banker entered into in the course of the carrying on by the banker of the business of banking, (h) the provision of credit, (i) any other rights (including rights in relation to, and interests in, property), benefits, privileges or facilities that are, or are to be, provided, granted or conferred in trade or commerce.
9. In our opinion, acting as agent for a vendor in broking the private sale of a boat pursuant to a contract, by means of advertising the boat and acting as agent on behalf of the vendor to negotiate with prospective purchasers, involves "the performance of work" or the provision, grant or conferral in trade and commerce of a "benefit" or "facility", and is thus a service within the meaning of the FT Act.
10. Consequently, there was a supply of services by the agent to the vendor under the Brokerage Deed. The question is whether or not there was also a supply of services by the agent to the appellants, in circumstances where they were not the contracting party.
11. The evidence in this case discloses that the services being supplied were the advertising of the boat on the Internet, as well as acting as agent for the vendor in providing information about the boat, and negotiating the sale on behalf of the vendor. These facts are not in dispute.
12. "Supply" includes the supply of services, whether or not made under a contract. As such, even though the appellants did not pay any money in connection with the advertising services, this fact does not preclude the present claim from being a consumer claim within the meaning of the FT Act: see s 79E(1) above.
13. The question is whether the provision of advertising on the Internet is a supply by the agent to the appellants, as opposed to a supply to the vendor only.
14. As indicated above, the definition of "supply" is inclusive. Its meaning has been considered in a number of cases, including under relevant Trade Practices legislation. In Australian Competition and Consumer Commission v Flight Centre Limited (No 2) [2013] FCA 1313, Logan J said at [130]: Such is the breadth of the ordinary meaning of the word "supply", "[t]o provide, or provide with, something. a. trans; to furnish or provide (a person) with something; (in early use) to satisfy the wants of, provide for; (now usually) to furnish with regular supplies of a commodity. Freq. with with" (Oxford English Dictionary, online edition, accessed 14 Nov. 2013), I doubt that the inclusive quality of the s 4 definition adds much, if anything, to the meaning of the word for the purposes of the TPA. It has long been regarded as a word of wide import: Commonwealth of Australia v Sterling Nicholas Duty Free Pty Ltd [1972] HCA 19; (1972) 126 CLR 297 at 309.
15. Making available information to a third party on the Internet about the sale of a boat is to provide or furnish to that person a service and is therefore a supply within the above definition.
16. There is no reason why the term "supply", as it is used in the FT Act, should be given a narrower meaning to that in Australian Competition and Consumer Commission v Flight Centre Limited. This is because the FT Act is consumer protection legislation. It should be construed in a beneficial way, consistent with its purpose. It would be a curious result to construe it in a manner whereby a vendor paying for advertising services, as a consumer, would be able to bring a claim in the Tribunal against his agent, but a consumer to whom the advertising was directed could not do so.
17. The service in the present case is provided in trade and commerce, the agent carrying on the business of broking boats for reward. The agent is therefore a supplier within the meaning of the FT Act, where s 79D defines "supplier" to mean "a person who, in the course of carrying on (or purporting to carry on) a business, supplies goods or services".
18. Consequently, we are satisfied that there was a supply by the agent (as supplier) to the appellants (as consumers), and that the appellants' claim - alleging misrepresentation or false or misleading conduct of the agent - is a consumer claim within the meaning of the FT Act.
19. It follows that the Tribunal was in error in concluding that it did not have jurisdiction to hear the claim. The order dismissing the application should be set aside and the proceedings remitted for rehearing.
20. In reaching this conclusion, we say nothing of the merits of the claim, which is a matter to be dealt with at the rehearing.

Orders

1. The Appeal Panel makes the following orders: 1. The appeal is allowed, the order dismissing application MV 18/15583 is set aside and the proceedings are remitted for rehearing. .********** 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 22 October 2018 - No changes made 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: 22 October 2018