Transwest Fuels Pty Ltd v Knee

Background

1. The appellant owns and operates a service station at Kootingal, NSW.
2. On 7 January 2021 the respondent drove her car to that service station and filled it with about $50 of fuel.
3. The respondent left the service station in her car and, within about 1 km from the service station her car broke down. Her car was towed to a local mechanic.
4. The local mechanic examined the respondent's car, took a fuel sample from the car and found the fuel was contaminated with water. The mechanic then removed the fuel tank, drained and flushed/cleaned the fuel tank, blew out the fuel lines and performed various other work for which it charged the respondent $577.49.
5. The respondent commenced proceedings against the appellant in the Tribunal claiming that the appellant had breached the guarantees provided in the Australian Consumer Law in relation to the supply of the fuel.
6. We interpolate that Part 3 Division 2 of the Fair Trading Act 1987 (NSW) (FT Act) provides for the application of the Australian Consumer Law (relevantly comprising Schedule 2 to the Competition and Consumer Act 2010 (Cth)) as in force from time to time as a law of New South Wales, its reference as the Australian Consumer Law (NSW) (the "ACL"), and its inclusion as part of the FT Act.
7. Part 6A of the FT Act confers jurisdiction on the Tribunal in relation to consumer claims which may include a claim for damages for breach of a guarantee of the ACL.
8. The parties attended a mediation conducted by the Tribunal on 20 April 2021. The parties were not able to settle their dispute on that occasion and the Tribunal made orders in preparation for a contested hearing. The Tribunal's orders made that day included the following relevant orders: "1. By Determination of Member, on 20 April 2021 the hearing was adjourned to a date to be fixed by the Registrar. 2. …. 3A. The respondent shall provide to the applicant and the Tribunal, either in person or by post, a copy of all documents (see note below), on which the respondent intends to rely at the hearing by 11-May-2021. 4. … 5. A failure by a party to provide documents in accordance with the Tribunal orders may result in the party not being able to rely on the documents at the hearing, unless leave is granted to do so."
9. The "respondent" referred to in those orders is the appellant, and the "applicant" is the respondent in this appeal.
10. Those orders were put in writing and sent to the same address for the appellant as it provided in its Notice of Appeal.
11. On 10 May 2021 the appellant emailed the Tribunal and received an email in reply approximately three hours later which enclosed a copy of the respondent's Application to the Tribunal (which commenced the proceedings).
12. On 10 May 2021 the appellant sought and obtained from the Tribunal an extension of time for compliance with Order 3A made on 20 April 2021 (quoted above), the extended date being 25 May 2021.
13. The fact that the orders of 20 April were sent to the same address as the appellant nominated in these appeal proceedings, and that the appellant sought an extension of time to the date given in Order 3A, satisfies us that the appellant received a copy of the Notice of Orders dated 20 April 2021 and was thus aware that it (and not the Tribunal) was required to provide its documents to the respondent.
14. Despite the terms of Order 3A, the appellant sent the documents upon which it intended to rely on at the hearing to the Tribunal but not to the respondent.
15. The appellant's documents included documentary evidence to the effect that fuel delivered to the appellant's service station came from a terminal in Newcastle, its most recent fuel deliveries prior to the respondent filling her car were received on 14 and 20 December 2020, and that had either of those deliveries been contaminated then multiple vehicles would have been affected across multiple sites.
16. Included in the documents was evidence from an employee of the appellant to the effect that he conducted weekly water checks on the service station's tanks and his observations that no water had been detected in any of those tests.
17. We divert briefly to note that on this appeal the appellant also sought to tender a statement of Mr Clifton dated 31 August 2021 to the effect that the appellant had been operating the service station since about 2016. He said that during this time the appellant had sold over 100 million litres of fuel without a single claim of contaminated fuel. He ascribed this fact to the appellant's processes and testing of fuel tanks and supply from fuel terminals. He said that all the fuel was tested by the appellant's suppliers prior to delivery, the appellant's tanks were tested weekly with a product called Sargel (a water finding paste) and no water had ever been detected. He said that no other complaints of contaminated fuel had been received by the appellant from the public either before or after 7 January 2021 (the date the respondent filled her car).
18. The statement of Mr Clifton post-dates the Tribunal hearing and is not admissible on this appeal because it has not been shown that this evidence was not reasonably available to the appellant at the time of the hearing - see cl 12(1)(c) of Sch 4 of the Civil and Administrative Tribunal Act 2013 (NSW) (the "NCAT Act"), Al-Daouk v Mr Pine Pty Ltd t/as Furnco Bankstown [2015] NSWCATAP 111 at [23] and cll 5 and 24(c) of NCAT Guideline 1: Internal Appeals, March 2016 (available on the Tribunal's website and which is mentioned towards the top of the Tribunal's Notice of Appeal with the recommendation that it be read).
19. The hearing before the Tribunal took place on 16 July 2021.
20. The Tribunal received the evidence of the appellant summarised at [4]-[7] above.
21. The respondent attempted to tender its documentary evidence summarised at [18]-[19] above. The Tribunal refused to admit (or consider) this evidence because it had not been served on the respondent prior to the hearing.
22. The Tribunal then received and accepted the respondent's evidence, found that the fuel purchased from the appellant on 7 January 2021 had been contaminated with water, that the supply of the contaminated fuel amounted to a failure to comply with the guarantee provided by the ACL, and that the charges by the local mechanic (see [7] above) were incurred as a result of that failure to comply.
23. The Tribunal awarded the respondent the sum of $626.63 for the repairs needed for her vehicle and as a refund for the cost of the contaminated fuel.
24. In its decision the Tribunal referred to the guarantee provided in s 61 of the ACL which relates to the supply of services, and found the breach concerned a failure to provide a "product" which was "fit for purpose". The reference to s 61 appears to be an error as what was supplied were "goods" and not a service, and so the relevant section of the ACL was s 55.
25. Section 55 of the ACL provides that if a person (the appellant in this case), in trade or commerce, supplies goods to a consumer, there is a guarantee that the goods are reasonably fit for any disclosed purpose, and for any purpose for which the supplier represents that they are reasonably fit.
26. The incorrect reference to s 61 rather than s 55 is irrelevant in our view, given the findings of fact made by the Tribunal and its finding that the appellant failed to provide a "product" which was "fit for purpose". In those circumstances s 55 applied.

The Appeal

1. The appellant appealed on one ground, namely that it had been denied procedural fairness by the Tribunal in refusing to admit its evidence.
2. The appellant submitted that it had sent its evidence to the Tribunal, but not to the respondent, because it did not know that it had to serve its evidence on the respondent and because it had been sent the respondent's evidence by the Tribunal on 10 May 2021 (and thus thought the Tribunal would serve the appellant's evidence on the respondent).
3. Whether that explanation or evidence to support it was given to the Tribunal is unknown as the appellant did not provide us with a copy of the sound recording or a transcript of the hearing before the Tribunal.

Decision

1. We do not agree with the appellant's submission that the Tribunal erred in its decision to refuse to admit its evidence.
2. That decision was one of practice and procedure and involved a discretionary decision.
3. Because it was a discretionary decision the appellant needed to show on this appeal, as required by House v The King (1936) 55 CLR 499; [1936] HCA 40, that in making its decision the Tribunal did one (or more) of five things: 1. it made an error of legal principle; 2. it made a material error of fact; 3. it took into account some irrelevant matter; 4. it failed to take into account or gave insufficient weight to, some relevant matter; or 5. it arrived at a result so unreasonable or unjust as to suggest that one of the foregoing categories of error had occurred, even though the error in question did not explicitly appear on the face of the reasoning.
4. During the appeal we explained to the appellant what it needed to show in terms of the requirements of House v The King as summarised above, but the appellant was not able to and did not submit that any of those five factors existed, and none are apparent to us from the material.
5. Perhaps the closest the appellant may have come to suggesting error, at least impliedly (taking in to account the appellant's representative is not legally trained) was the fifth error mentioned above, namely whether the Tribunal arrived at a result so unreasonable or unjust as to suggest that one of the other categories of error had occurred, even though the error in question did not explicitly appear on the face of the reasoning.
6. There are two problems with that submission.
7. The first was that the Tribunal did give a reason for the refusal to admit the evidence (and this category of error requires the absence of reasons - Australian Health & Nutrition Association Ltd v Hive Marketing Group Pty Ltd [2019] NSWCA 61 per Bathurst CJ and Leeming JA at [9]-[10]), the reason being that the appellant had not served its evidence on the respondent.
8. The second problem is that to the extent this ground may encompass legal unreasonableness, the test on appeal is stringent. In EFQ (a pseudonym) v Medical Council of New South Wales [2021] NSWCA 167 (EFQ) Bell P, with whom Macfarlan JA at [78] and Brereton JA at [79] agreed, said at [69]: "… The stringency of the test is reflected, for example, in the language of Hayne, Kiefel and Bell JJ in Li at [76], namely that '[u]nreasonableness is a conclusion which may be applied to a decision which lacks an evident and intelligible justification'…".
9. In this case, there was an evident and intelligible justification for the refusal to admit the appellant's evidence, namely that it had not been served on the respondent and therefore she had not been given a reasonable opportunity to prepare to meet that evidence.
10. In EFQ the question was whether the refusal to grant an adjournment was erroneous, a not too dissimilar question to the refusal in this case to admit the appellant's evidence. Given that similarity, the following observations of Bell P in EFQ are apposite: "[67] A party which is given ample notice of a hearing cannot complain that there has been a denial of procedural fairness where he or she declines to participate in the hearing and the hearing proceeds in accordance with the adequate notification. Procedural fairness requires an adequate opportunity to participate to have been given, and a denial of procedural fairness cannot be generated by a deliberate or conscious decision not to participate in a hearing of which sufficient notice has been given. [68] … In Lewis v Chief Executive of the Department of Justice and Community Safety of the Australian Capital Territory (2013) 280 FLR 118; [2013] ACTSC 198 at [165], Refshauge ACJ said that "[i]t is clear on the authorities that a party who is given an opportunity to put his or her case but, through their own default, fails to take the opportunity, has no basis for complaint if they are not heard", citing Allesch v Maunz (2000) 203 CLR 172; [2000] HCA 40 at [27]."
11. For completeness, we add that House v The King holds that it is not enough (for a successful appeal) that we (the Appeal Panel) may have taken a different course to that taken by the Tribunal (that is, admitted the evidence rather than rejecting it). What must be shown by the appellant is that some error was made by the Tribunal in exercising the discretion to refuse to admit the evidence (of the kind mentioned earlier), but none has been shown.
12. Therefore, the appeal must fail.
13. We add that it is compulsory, not voluntary, for parties to abide by orders such as those made by the Tribunal on 20 April and 10 May 2021 - s 36(3) of the NCAT Act.
14. The appellant was unambiguously directed by the orders made on 20 April that it had to serve its evidence on the respondent and had to do so by 11 May 2021 (later extended at the appellant's request to 25 May 2021). The appellant was clearly warned in those same orders that: "A failure by a party to provide documents in accordance with the Tribunal orders may result in the party not being able to rely on the documents at the hearing, unless leave is granted to do so."
15. The purpose of such orders is to ensure a fair hearing. That is, to ensure that every party has a fair opportunity, before a hearing, to prepare any evidence or arguments in reply to the other party's evidence. In this case, that required the appellant to provide its evidence to the respondent by 25 May 2021 so that she would have time to prepare to meet that evidence.
16. It is implicit in the Tribunal's decision that it considered that had it admitted the appellant's evidence, in the absence of the appellant providing the respondent with a fair opportunity to prepare to meet that evidence, there would have been prejudice to the respondent and thus she would not have received a fair hearing.
17. Therefore, it can be seen that the Tribunal's refusal to admit the appellant's evidence was the natural result of the appellant failing to comply with the Tribunal's orders and failing to provide the respondent with a fair opportunity to prepare her case in answer to that evidence.
18. As we mentioned earlier, we were not provided with a sound recording of the hearing before the Tribunal, but the appellant did not suggest to us that it had sought and been refused an adjournment by the Tribunal after the Tribunal told the appellant that its evidence would not be accepted. Therefore no point arises as to whether the Tribunal erred in refusing the appellant an adjournment to overcome the problem arising from its failure to serve the respondent with its evidence by the due date.

Orders

1. We make the following order: 1. The appeal is dismissed.

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: 26 October 2021