Upton v Martin & Stein Antiques Pty Ltd

n GEN 15/58450;D Charles, Member, decision dated 11 December 2015 in GEN 15/62147;C Paull, Member, decision dated 17 March 2016 in GEN 15/67511. File Number(s): GEN 15/58450, GEN 15/62147, GEN 15/67511

Overview

1. This appeal concerns the purchase of a pair of bracelet cuffs from an antique jewellery shop in Sydney in February 2006.
2. As a result of procedural rulings by the Appeal Panel in June and July 2016, the claim for damages brought by the purchaser of the cuffs, the Appellant, Ms Upton, the subject of this appeal, is now before the Appeal Panel for consideration on its merits should an appeal from the original decision concerning her claim be permitted to be lodged out of time and the appeal be upheld.
3. The Respondent has been given the opportunity to provide evidence and submissions as to the merits of the claim, but no such material has been provided by it in answer to Ms Upton's claim.
4. Accordingly, the facts as supplied in the material provided to the Tribunal by Ms Upton are not disputed. The key issue on the appeal, and on the merits, is whether all of her causes of action were commenced outside the time limit for the Tribunal to have jurisdiction to deal with her claim. That is a time limit of three years from the time when her causes of action first accrued. Ms Upton lodged her first claim in the Tribunal on 23 October 2015.
5. For the reasons set out below, in our opinion, some of her causes of action were not out of time when she began her proceedings and ought to have been upheld. In our opinion, the Tribunal at first instance, in its original decision dated 4 November 2015 erred on a question of law in concluding that her claim was out of time. We explain below the consequences which, in our opinion, should follow from this conclusion. The ultimate result is that the first and third decisions of the Tribunal at first instance (to which we refer below) should be set aside and Ms Upton's claim is remitted to the Tribunal at first instance for an assessment of the amount to be paid to her by way of damages (for the heads of damage referred to below in paragraphs 67(1) and 67(3)).
6. Before dealing with the merits of her appeal and of her claim, we should outline relevant aspects of the procedural history of this matter to date.

Procedural history

1. The appeals from the three decisions of the Tribunal at first instance with which we are now dealing began with an appeal from the third decision dated 17 March 2016. Our reasons for an interlocutory decision in that appeal, issued on 15 June 2016, following a hearing on 3 June 2016 (attended by Ms Upton by telephone, but with no appearance by the Respondent), included: ….. 5 From matters raised by Ms Upton on the appeal, and examination of the files at first instance, in our opinion, there is reason to be concerned that, to date, errors have occurred in dealing with her claim. 6 At the present stage of our dealing with the appeal, it is not necessary for us to come to a final conclusion about this, nor is it appropriate that we do so. 7 We are, however, inclined to make orders directed at seeking to ensure that an important question as to the operation of the time bar applied to her claim in this Tribunal is properly determined, along with the merits of her claim. 8 Those orders, if made, would have the effect of treating the current appeal as including an appeal against two decisions of the Tribunal at first instance that were made before the decision the subject of the present appeal. 9 If we did proceed to make such orders, we would envisage making associated directions concerning the identification of evidence and submissions to be now relied upon on the basis that the Appeal Panel decided to deal with the appeals by way of a new hearing on the merits of Ms Upton's claim pursuant to s 80(3)(a) of the Civil and Administrative Tribunal Act 2013 (NSW) (the Act). 10 However, before making such orders and directions we invite the parties to make submissions in writing about the procedural course that we have in mind. It is for this purpose, that we make the directions set out below. 11 Before making those directions, we, briefly, set out some additional background and reasons for the steps that we have in mind. 12 The appeal in this matter was heard on 3 June 2016. Ms Upton appeared by telephone call from England. There was no appearance by the Respondent. 13 As things stand, there are two decisions of the Tribunal at first instance making orders dismissing Ms Upton's claim. 14 In the first of these two decisions, made on 4 November 2015, the Tribunal below found it had no jurisdiction to determine the claim. In its opinion, it had no jurisdiction because Ms Upton's claim was time barred under s 79L (1) (a) of the Fair Trading Act 1987 (NSW). The Tribunal expressed her claim as one in which Ms Upton claims that the goods were misrepresented to her. The Tribunal was of the view that her cause of action arose on the day of purchase, so that her claim in the Tribunal lodged on 23 October 2015 was lodged well beyond the 3 year period provided for in s 79L. 15 We note that in Ms Upton's statement provided with her application to the Tribunal she stated that her alternative claim (alternative to a claim that she described as for specific performance) was for damages for breach of contract, misrepresentation and deceit - she also referred to the making of false and misleading statements to her about the cuffs. Without finally deciding at this time, it would appear that the Tribunal was in error in not deciding that, so far as her claim for misleading and deceptive conduct and in tort was concerned, such causes of action did not accrue until Ms Upton became aware of the misdescription, or through reasonable diligence should have become so aware - for example, see McBride v Christie's Australia Pty Ltd [2014] NSWSC 1729. 16 Another issue with this decision concerns procedural fairness. The time bar point was not raised with Ms Upton. This is not the occasion to examine all the circumstances as to why this occurred, other than to say that Ms Upton had told the Tribunal that she did not intend to participate in the hearing and she did not do so. However, this was the first hearing after her application was lodged and she had reason to think that no final hearing of her claim would occur on that occasion. 17 The second of these two decisions dismissing her claims was made on 17 March 2016 in a fresh proceeding commenced by Ms Upton. This is the decision, currently, under appeal. There was no appearance by the Respondent at the hearing. On this occasion, the Tribunal dismissed her application on the following grounds: The Tribunal was not satisfied it had jurisdiction because, in view of the Tribunal's determination made 4 November 2015, it was not open to Ms Upton to re-litigate the same facts and issues that were the subject of the first proceedings. 18 In any event, the Tribunal was of the opinion that her claim was out of time. The Tribunal found that if her claim was in contract her cause of action arose at the time of sale. If her claim was in tort or under statute, in the opinion of the Tribunal, her claim arose when the absence of the black opals was reasonably discoverable. According to the Tribunal, this was in 2006 when the cuffs were valued for insurance purposes. 19 Yet further, there was no evidence to substantiate the difference in value between the jewellery she actually purchased and the jewellery she purchased as represented to her. 20 As to discoverabilty, the decision of the Tribunal under appeal does not spell out the reasons for the view that the absence of black opals was reasonably discoverable in 2006, when they were valued for insurance purposes. Against that view, it would seem that the expert valuer proceeded on the basis that the stones were black opals and nothing else. There is no suggestion that this valuer removed any of the stones for examination at this time. A further point about the discoverability issue concerns whether the Respondent appreciated, at the time of sale, that they were only black opal doublets. If it did not, that would be a point in favour of Ms Upton's argument that the true position was not reasonably discoverable until the events in 2015. 21 In between these two decisions was another decision of the Tribunal at first instance, made on 11 December 2015, refusing Ms Upton's application to set aside the first decision. The application was refused on the ground that the Tribunal was not satisfied that Ms Upton's absence from the hearing had resulted in Ms Upton's case not being adequately put to the Tribunal; see clause 9(1)(b) of the Civil and Administrative Tribunal Regulation 2013. 22 The reasons of the Tribunal dismissing the set aside application do not deal with the issue relating to the first hearing that Ms Upton had not been told of a time bar point and given a specific opportunity to respond to it. 23 So far, Ms Upton has only brought an appeal against the decision of the Tribunal made on 17 March 2016, in the fresh action she commenced after her application to set aside the first Tribunal decision was refused. It was that appeal that came on for hearing before the Appeal Panel on 3 June 2016. 24 Since the hearing of the appeal, Ms Upton, at the direction of the Appeal Panel, has supplied detailed submissions as to why she was entitled to commence the fresh action, despite the first decision of the Tribunal on the subject of jurisdiction. Clearly, the question of issue estoppel arises as to the issue of jurisdiction and the anterior issue as to when her cause of action arose: see Handley, Spencer Bower and Handley Res Judicata, 4th edition at paragraphs 1.05, 1.10 and 2.15. Again, it is not yet necessary for us to rule upon this question because of the course we would prefer to follow. 25 If the Appeal Panel was to now decide that this current appeal could not succeed because of the existing decision made on 4 November 2015, an option for Ms Upton to take would be to file an appeal against the first decision and, possibly, also an appeal against the refusal to set aside that decision and to seek an extension of time for each of these appeals. 26 However, that is not a convenient course. It results in delay and more expense for Ms Upton, in circumstances where she has not had legal representation and where she does have grounds for criticism of these two earlier decisions of the Tribunal. 27 It is for these reasons that we are attracted to the making of orders that combine the current appeal with appeals against these two earlier decisions. It seems to us that such a course would be consistent with the guiding principle for the procedures of the Tribunal, namely to facilitate the just, quick and cheap resolution of the real issues between the parties and consistent with the power of the Tribunal to make amendments to documents filed in proceedings where it is in the interests of justice to do so: s 36(1) and s 53(1) of the Act. 28 However, before making such orders, we will give the parties an opportunity to make submissions about whether this should be done. 29 Accordingly, we make the following directions: Within 7 days of the date of these directions, each of the parties is to notify the Appeal Unit of the Tribunal, and each other, whether they object to the Notice of Appeal in this appeal being amended to include appeals, and applications for an extension of time in which to appeal, from the following decisions of the Tribunal: (1) decision dated 4 November 2015 in matter number Gen 15/58450 dismissing the Appellant's application on the ground that the Tribunal did not have jurisdiction to determine the Appellant's application, (2) decision dated 11 December 2015 in matter number Gen 15/62147 dismissing the Appellant's application to set aside the decision referred to in (a). If any of the parties does so object, within the 10 days of the date of these directions, they are to send to the Appeal Unit of the Tribunal and to the other party written submissions in support of such objection. The decision of the Appeal Panel on the question of the amendment of the Notice of Appeal referred to in paragraph (1) will be made on the papers, unless either party, at the time of providing written submissions referred to in (2), requests that there be a hearing on the question. No objection was taken to the course foreshadowed by the Appeal Panel, and on 18 July 2016 the Appeal Panel made the following orders: The orders of the Appeal Panel are: 1. The Notice of Appeal lodged on 12 April 2016 be amended to include: (i) an appeal against the decision dated 4 November 2015 in Matter No. Gen 15/58450; (ii) an appeal against the decision dated 11 December 2015 in Matter No. Gen 15/62147; (iii) applications for an extension of time in which to lodge appeals against the decisions referred to in (i) and (ii) above; 2 The matters put forward by the Appellant with the Notice of Appeal as grounds for appeal be treated as grounds of appeal in respect of the above two decisions as well as the decision appealed from in the Notice of Appeal; 3 Pursuant to s 50(1)(c) of the Act, the appeals shall be determined on the papers already provided to the Tribunal by the Appellant as described in Attachment A to this letter, along with any material the Respondent may provide pursuant to Order 4 below, unless by 29 July 2016, either party requests an oral hearing of these appeals, including any request by the Respondent to cross-examine the Appellant. 4 By 5 August 2016, the Respondent is to provide to the Appeal Unit and send to the Appellant by email to her email address palmers3@freenetname.co.uk any written submissions and any evidence, including statements from witnesses, upon which it wishes to rely.
2. Attachment A to the orders made on 18 July 2016 (referred to in Order 3) was in the following terms: Matter No. Gen 15/58450 Consumer claim application by Ms Upton dated 10 October 2015, received by the Tribunal on 23 October 2015, along with the statement of Ms Upton and bundle of documents accompanying that application. Matter No Gen 15/62147 Application to set aside a Tribunal decision by Ms Upton dated 5 November 2015 and accompanying statement and submissions. Matter No Gen 15/67511 3 Consumer and Commercial Division Application by Ms Upton lodged on 21 December 2015. 4 Submissions and Statement by Ms Upton received by the Tribunal on 19 January 2016. 5 Chronology and Skeleton Argument by Ms Upton sent to the Tribunal by email dated 2 March 2016 at 9.05am. Appeal 16/17397 from decision in Gen 15/67511 6 Notice of Appeal dated 2 April 2016 and accompanying documents, received by the Tribunal on 12 April 2016.
3. No material has been received from the Respondent in response to Ms Upton's evidence and submissions set out in Attachment A, as provided for in Order 4 made on 18 July 2016. No party has requested there be an oral hearing in accordance with Order 3.
4. Accordingly, we now proceed to determine these three appeals on the basis of the papers set out in Attachment A.

The facts

1. On the basis of Ms Upton's unrebutted evidence, principally that contained in her signed statement dated 10 October 2015, but also that contained in her signed statement dated 4 January 2016, we find as follows: 1. On 27 February 2006, whilst on a visit from England, Ms Upton purchased from the Respondent, at its shop in the Queen Victoria Building in Sydney, two bracelet cuffs, set with numerous stones, for the amount of $7,000. 2. She made this purchase under an oral contract evidenced in writing by an invoice issued by the Respondent. 3. Ms Upton believed the cuffs to be second hand or Estate jewellery with a unique design. 4. The Respondent held itself out to Ms Upton as specialising in, amongst other things, period jewellery. 5. Before completing the purchase, Ms Upton was told by a sales person of the Respondent that the stones in the cuffs were solid black opals. An invoice issued by the Respondent for the cuffs provides some support for the making of such a statement. It described the cuffs as a pair of sterling silver cuffs "set with black opal". We infer that Ms Upton was also told that the cuffs were set with black opals. 6. The invoice for the cuffs included a guarantee that all items were as described in the invoice. In her signed statement dated 4 January 2016, Ms Upton says that she relied upon the guarantee in making the purchase. 7. In fact, as was discovered by Ms Upton in 2015, the cuffs were set with opal doublets, meaning that a significant part of each stone was not an opal but consisted of a man made substance. With doublets, slices of opal are glued to a manmade backing designed to imitate the appearance of a solid black opal. This feature was not apparent because it was underneath the opal part of the stone set into the cuffs. 8. Until that discovery, Ms Upton always believed that the stones were solid opals. 9. If Ms Upton had known the stones were doublets she would not have bought the cuffs. 10. When she returned to England, Ms Upton arranged for the cuffs to be insured with her household building and contents policy. For this purpose, she had a valuation done by Peter Fry of A Simmonds, registered valuers in England, along with all her jewellery. This valuation attributed a replacement value of Pnds 3,000 to the cuffs. The valuation did not identify the stones as doublets but, instead, described them as "Black opals, blue - green, oval cabochon cut…" 11. On Ms Upton's birthday, 19 July 2015, she went with her husband to Walmer Castle in England where the Antiques Roadshow experts were providing free valuations for the television program. She took the cuffs with her to obtain a valuation. She saw Ms Joanna Hardy, who was a very experienced jewellery expert. Ms Hardy looked at the cuffs using an eye glass. She said that she could see a black line around some of the stones and that in her opinion the cuffs were set with doublets and not opals and that this made them worth very much less than A$7,000. When she was shown the invoice from the Respondent stating that the cuffs were set with black opals, Ms Hardy said that the only way to check the positon was to remove one of the opals from each cuff. 12. Ms Upton then twice emailed the Respondent about the issue. On 27 July 2015 she sent a letter to the Respondent enclosing a copy of the invoice and a photograph. In the letter she referred to Ms Hardy's opinion and advice that the only way to check was to remove one of the opals. Ms Upton asked what if any checks were taken when valuing the cuffs and what evidence they had of the cuffs being set with opals and not doublets. She said she was writing about this prior to incurring the cost of having a local gem expert remove two opals as recommended by Ms Hardy. Ms Upton received no response to any of these communications. 13. After contacting NSW Fair Trading, Ms Upton received a response from them, by email of 11 August 2015, which included: Your concerns were brought to the attention of Ms Annemie Stein….Ms Stein advised that she is not able to confirm the details of your item purchased in year 2006 as her store retains the transaction history for seven years only. Ms Stein further advised that her consumer guarantees for overseas customers expire after 30 days from delivery in order to avoid disputes relating to unauthorised alteration of items. Ms Stein indicated that she would not be able to provide a proof that your item contains black opals instead of doublets. 1. In the circumstances, Ms Upton decided to obtain an expert gemstone identification report from gemmologists with AnchorCert. She sent them the cuffs. She received a report from them dated 30 September 2015. This stated that two "cabochons" from each bangle had been examined and concluded "Both found to be Opal Doublets." Costs were incurred by Ms Upton in obtaining this expert analysis. 2. Through the Respondent's website, Ms Upton informed the Respondent of the results but she received no response.
2. In her statement of 10 October 2015, Ms Upton said that she had tried to quantify her loss but had been told by three different valuers that she should request the Tribunal for a direction as to whether the value should be carried out in Australia and whether it be at the time of purchase or a current day value. She also said she preferred to obtain "specific performance" under which she would exchange the cuffs for cuffs set with black opals. Alternatively, she asked for damages, including the loss of benefit of value and costs of obtaining the gem inspection report.
3. As to Ms Upton's approach to the difficulty of knowing how to quantify her loss, we should make some remarks. Whilst, in the interests of justice, a degree of flexibility can sometimes be shown by the Tribunal in its procedural approach to the question of damages, for example, in recognition of complexity in quantifying loss, the preferred course will usually be that all evidence concerning loss be presented to the Tribunal, along with all of the other evidence in respect of the dispute, so that the potential need for two hearings can be avoided. Furthermore, as will appear below, in those cases where damage is the gist of the action, it will (save in exceptional cases) be essential that evidence is presented that is sufficient to establish at a hearing that, at least, some loss has been sustained. Even with an unrepresented litigant, it is also important that the Tribunal does not overstep the boundaries and become an adviser to a party on aspects of the claim.
4. We return to the question of loss later in these reasons.

The decisions of the Tribunal below about the time bar

1. As appears from our reasons for the interlocutory decision of 15 June 2016, there were two decisions of the Tribunal at first instance that concluded that Ms Upton's claim was brought outside the three year limitation period. That limitation period is contained in s 79L of the Fair Trading Act 1987 (NSW) (the FTA), which provides: 79L Limitation periods (1) The Tribunal does not have jurisdiction to hear and determine a consumer claim if any of the following apply: (a) the cause of action giving rise to the claim first accrued more than 3 years before the date on which the claim is lodged, (b) the goods or services to which the claim relates were supplied (or, if made in instalments, were last supplied) to the claimant more than 10 years before the date on which the claim is lodged. (2) Nothing in this section affects any period of limitation under the Limitation Act 1969.
2. Section 79L of the FTA was applicable because, as part of the new Part 6A of the FTA, it had commenced to operate as from 1 October 2015, shortly before Ms Upton lodged her claim in the Tribunal.
3. In the first decision dated 4 November 2015, the Tribunal concluded that Ms Upton's claim was a consumer claim in respect of which the Tribunal had jurisdiction, subject to the limitation period for such claims. It is clear that the Tribunal was correct in so concluding. Ms Upton was a consumer (as defined in s 79D of the FTA) who made a claim for a specified sum of money, namely the sum of $12,000 (as specified in the money order section of order 4 of her application), within the meaning of s 79E (1)(a) of the FTA.
4. We note that subsection (1)(b) of s 79L was inapplicable on the facts because Ms Upton's claim was lodged within the ten year period from supply there specified.
5. As to the limitation period, the Tribunal in the first decision, in brief reasons, concluded that the cause of action accrued on 27 February 2006, the date of the purchase. The Tribunal referred to the claim that the cuffs had been misrepresented to Ms Upton, but did not specifically identify the cause of action.
6. The third decision (the decision of 17 March 2016) referred to the causes of action involved. In that decision, the Tribunal concluded (if it was wrong about the issue estoppel basis for dismissal), correctly, in our opinion, that Ms Upton's cause of action in contract first accrued at the time of sale. The Tribunal also concluded that Ms Upton's cause of action in tort or statute (we assume this was a reference to claims under the FTA) first accrued when the absence of black opals in the cuffs was reasonably discoverable. The Tribunal decided this was when the valuation of the cuffs was carried out in 2006, after Ms Upton returned to England.
7. As will be seen below, we disagree with the first decision, except in so far as it concerned Ms Upton's claim in contract. We agree with the conclusion of the third decision as to when Ms Upton's claims in contract, negligent misrepresentation and misleading and deceptive conduct first accrued, but we disagree with the conclusion in that decision as to when the true situation was reasonably discoverable.

Grounds of appeal

1. In view of the conclusion we have come to about the time bar issue and the consequences that flow from that conclusion for the outcome of these appeals, it is sufficient for us to make reference to what can be seen as Ms Upton's main grounds of appeal. They are that:

• in arriving at the first decision, the Tribunal at first instance erred in law as to the time when her cause of action first accrued and;
• in arriving at the third decision, the Tribunal at first instance erred in its application of the test as to when her cause of action first accrued.

1. Ms Upton did not frame grounds of appeal in a conventional way. Rather, she set out an argument directed at her criticisms of the third decision.

Extension of time for appeal

1. Ms Upton's appeal against the first decision is well out of time. Under the rules (Rule 25(4)(c) of the Civil and Administrative Tribunal Rules 2014) she had 28 days from the time when she was notified of the decision in which to lodge an appeal.
2. Ms Upton was an unrepresented litigant and, as referred to above, it is clear that she sought to challenge the fairness and correctness of the first decision, but sought to do so by methods other than by appealing that decision. Those steps and the procedural course that resulted explain the delay.
3. In our opinion, given the explanation for the delay, her prospects of success and the importance of the questions raised as to the operation of the time bar, Ms Upton should be granted an extension of time in which to appeal from the first decision: Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22 at [22]. As will appear below, it is unnecessary for us to deal with the appeal against the second decision, including the application for an extension of time in respect of that appeal.

The various causes of action and when they first accrued

1. In her first application lodged on 23 October 2015, Ms Upton made it clear that she did not seek to rescind the contract and obtain her money back. She sought delivery of cuffs as promised to her for which she would exchange the cuffs she received (she described this claim as being for specific performance). Alternatively, she sought damages: "…for breach of contract, misrepresentation and deceit…"
2. In what she described as the details in support of her claim, she also referred to the making of false and misleading statements about the opal doublets and to unconscionable conduct in stating that the guarantee for overseas customers expired after thirty days.
3. Ms Upton should be regarded as bound by that choice not to seek to rescind the contract and claim her money back. She had an election to make between remedies. We say this because in her argument provided with her Notice of Appeal from the third decision she says that she told the Tribunal at first instance in the action the subject of the third decision that her second choice (after specific performance) was now to return the cuffs and obtain a refund of the purchase price because of the difficulty in valuing the cuffs.
4. In view of Ms Upton's position in her first action that she did not seek rescission, and having regard to the real issues, various causes of action could be put aside. As a consequence, in our opinion, it would have been sufficient for the Tribunal at first instance to have dealt with the time bar issue by reference to the causes of action outlined in paragraph 35 below.
5. First, causes of action for an order for a refund of the purchase price and return of the cuffs were not under consideration: s 79N(h) of the FTA.
6. Secondly, her claim for "specific performance" (so far as the jurisdiction of the Tribunal is concerned, properly seen as a claim described in s 79N(e) of the FTA for delivery of goods of a specified description) was not a real issue for consideration - it could be rejected as such because there was no suggestion that the Respondent was capable of supplying the cuffs that Ms Upton contracted to purchase.
7. Finally, the claim of unconscionable conduct in respect of the unilateral withdrawal of the guarantee contained in the invoice could lead Ms Upton to no better position than having such benefit as there was from her claim in contract for breach of the guarantee.
8. Bearing in mind that Ms Upton did not have legal representation, we consider that her application lodged on 23 October 2015 raised, as real issues, the causes of action set out below. In setting these out, we do not suggest that the Tribunal member needed to deal with each of them at any length. We recognise the burden placed upon a busy Tribunal member seeking to determine a case efficiently and quickly in the face of complexity of the law, despite the simplicity and size of the transaction in issue. However, given the prospect that Ms Upton's claim may fail for being commenced out of time, each of these causes of action and their associated time of accrual needed to be considered.
9. The time of first accrual of the following causes of action for loss and damage, in the form of a claim for a specified sum (s79E(1)(a)), arose for consideration: 1. In contract, for breach of the express guarantee contained in the invoice that the cuffs were as described in that invoice. 2. In contract, for breach of the terms implied by s 18 of the Sale of Goods Act (1897) (NSW) (the SGA) and s 40P of the FTA (as it was at the time of purchase) that the cuffs correspond with their description. 3. Under the now replaced sections of the FTA for damages under s 68 for contraventions of s 42 (misleading and deceptive conduct) and s 44(a) (false representation about quality or composition of goods) of the FTA. These claims, under now replaced legislation, existed because the conduct giving rise to Ms Upton's claim preceded the commencement of the Australian Consumer Law (NSW). 4. In tort, for negligent misrepresentation. 5. In tort, for fraudulent misrepresentation.
10. In her documents supplied in support of her appeal Ms Upton made a number of references to her rights under the Australian Consumer Law. However, as we have just mentioned, even as a law of NSW (Australian Consumer Law, NSW), such law was inapplicable. This is because the relevant provisions of that law (and the equivalent provisions in the Commonwealth Australian Consumer Law) did not commence until 1 January 2011 and did not regulate the conduct of the Respondent at the time of purchase in February 2006. Accordingly, this case is not concerned with, for example, any question of a breach of the statutory guarantees contained in Division 1 of Part 3-2 of the Australian Consumer Law, NSW, as was dealt with by the Appeal Panel in Lam v Steve Jarvin Motors Pty Ltd [2016] NSWCATAP 186. We are, therefore, not concerned with a claim for reduction in value from the price paid under s 259(3)(b) of the Australian Consumer Law, NSW by reason of a breach of the guarantee contained in s 56(1) of that law that goods conform with description.
11. We are also not concerned with claims for damages for contravention of the misleading and deceptive conduct and false representation provisions of the Commonwealth Trade Practices Act 1974, in operation at the time of purchase, because of the absence of jurisdiction for the Tribunal to deal with such claims: see s 86 of Trade Practices Act 1974 (as it was at the time of purchase) and, for example, Herbert v American Express Australia Ltd & Ors [2016] NSWCATAP 47 at [46(11)].
12. The time of first accrual of these causes of action is not only relevant to the application of s 79L of the FTA concerning the jurisdiction of the Tribunal. It is also relevant to the respective limitation periods which affects the ability of Ms Upton to maintain these statutory and common law causes of action at the time when she first brought her claim in the Tribunal.
13. Those limitation periods were as follows: 1. For the claims in contract identified in paragraph 36 (1) and (2) above, a period of 6 years from the time when those causes of action first accrued: s 14(a) of the Limitation Act 1969 (NSW). 2. For the claims under s 68 of the FTA identified in paragraph 36(3) above, a period of 6 years from the time when the causes of action first accrued: s 68(2) of the FTA (as it was at the time of purchase). 3. For the claims in tort for misrepresentation identified in paragraph 36(4) and (5) above, a period of 6 years from the time when those causes of action first accrued: s 14(b) of the Limitation Act 1969 (NSW).
14. As will be seen below, because of the conclusions we have reached as to the time when the respective causes of action first accrued, the result is that both the statutory causes of action and those in tort were still in existence, maintainable and within the jurisdiction of the Tribunal at the time when Ms Upton first brought her claim.

Accrual of cause of action - breach of contract

1. The causes of action in contract in paragraph 36(1) and (2) above first accrued at the date breach: Woolcock Street Investments Pty Ltd v CDG Pty Ltd and Another (2004) 216 CLR 515 at [103]; Allianz Australia Insurance Ltd v Haddad [2015] NSWCA 186 at [21]. In this case, the date of breach was 27 February 2006 when the cuffs were delivered to Ms Upton at the time of purchase.
2. Applying s 79L of the FTA, it is clear, therefore, that the Tribunal had no jurisdiction to determine Ms Upton's claim based on these causes of action because they accrued more than three years before she commenced proceedings in the Tribunal.

Accrual of statutory causes of action - misleading and deceptive conduct and false representation as to quality

1. At the time of purchase, ss 42 and 44(a) of the FTA, relevantly, provided: 42 Misleading or deceptive conduct (TPA s 52) (1) A person shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive. (2) Nothing in this Part shall be taken as limiting by implication the generality of subsection (1). 44 False representations (TPA s 53) A person shall not, in trade or commerce, in connection with the supply or possible supply of goods or services or in connection with the promotion by any means of the supply or use of goods or services: (a) falsely represent that goods are of a particular standard, quality, value, grade, composition, style or model or have had a particular history or particular previous use,
2. The causes of action for a contravention of these provisions referred to in paragraph 36(3) were created by s 68 of the FTA.
3. At the time of purchase of the cuffs, s 68 of the FTA, relevantly, provided: 68 Actions for damages (TPA s 82) (1) A person who suffers loss or damage by conduct of another person that is in contravention of a provision of Part 3, 4, 5 (section 43 excepted), 5A, 5B, 5C or 5D may recover the amount of the loss or damage by action against the other person or against any person involved in the contravention. ……. (2) An action under subsection (1) may be commenced at any time within 6 years after the day on which the cause of action that relates to the conduct accrued
4. According to the terms of subs (1) of s 68, the action does not arise unless and until loss or damage is suffered. As with actions in tort, damage is the gist of the action. Hence, the cause of action first accrues within the meaning of subs 68(2) of the FTA and s 79L of the FTA when the requirement that loss and damage be suffered is first satisfied.
5. As to the like provision in the Trade Practices Act 1974, namely s 82(2), Deane J said in Wardley v The State of Western Australia (1992) 175 CLR 514 at page 539; [1992] HCA 55: ….s. 82(1) of the Act entitles a person "who suffers loss or damage by conduct of another person that was done in contravention of a provision" of Pt IV or Pt V of the Act to "recover the amount of the loss or damage by action against that other person or against any person involved in the contravention". Clearly, an essential ingredient of a claim under s. 82(1) is that the plaintiff has suffered loss or damage caused by the alleged contravening conduct. Under s. 82(2), an action under s. 82(1) "may be commenced at any time within 3 years after the date on which the cause of action accrued", that is to say, the date on which the facts necessary to found a right to recover damages under s. 82(1) first existed [56]. In the circumstances of the present case, the cause of action first accrued in relation to the new claim when the requirement that the State "suffer loss or damage" caused by the appellants' alleged conduct was first satisfied. (We note that by February 2006 the time period had been extended to 6 years).
6. A submission that there be a general qualification that time does not commence to run until the damage is discovered by the plaintiff or could on reasonable inquiry have been discovered in claims in negligence for economic loss was rejected by a majority of the High Court in Hawkins v Clayton (1988) 164 CLR 537: see, as per Deane J in Wardley at page 540.3.
7. However, even the rejection of such a general qualification still permits the recognition that in some cases of claims in negligence and, as will be seen below, by analogy, for misleading and deceptive conduct, no loss or damage is sustained until the defect or problem becomes manifest, or could with reasonable diligence be discovered. It is only then that a diminution in value eventuates. Before that time, the property purchased might have been sold without any loss. This is the case with latent defects: see per Deane J in Hawkins v Clayton (1988) 164 CLR 537 at 588; [1988] HCA 15 and in Wardley at page 540.7.
8. In this regard, McHugh J in Woolcock said in relation to the claim in tort in Sutherland Shire Council v Heyman [1985] HCA 41; (1985) 157 CLR 424: [56]….. After buying the house, the owners were forced to expend money to repair cracking and other problems resulting from faulty foundations….Deane J held that it was economic, not physical, damage. He held that, as a result of the defective foundations, the owners suffered pure economic loss upon the market value of the house falling when the defect was "first known or manifest". By "manifest", Deane J meant "discoverable by reasonable diligence". The view of Deane J as to the nature of the damage has prevailed. It is economic loss, not physical damage.
9. That such a category of case exists where the cause of action is for economic loss caused by misleading and deceptive conduct was recognised by Bergin J in McBride v Christies Australia [2014] NSWSC 1729, a case that is analogous to the present.
10. In the McBride case, the plaintiff had purchased what she believed to be a painting by Albert Tucker. The painting turned out to be a forgery. The purchaser succeeded in a claim for misleading and deceptive conduct against the vendor which was commenced more than 10 years after the painting was acquired.
11. Bergin J reasoned as follows: [217] The defendants contended that any loss was suffered immediately upon purchase of the Painting in 2000 and accordingly the plaintiff's claims are statute-barred. The defendants claimed that the alleged defects in the Painting were not latent. [218] The plaintiff submitted that her causes of action in negligence and under statute for misleading and deceptive conduct and unconscionable conduct only accrued in 2010 when she suffered the loss and damage upon which she sues. In this regard it was submitted that it is important to appreciate that the loss for which the plaintiff sues is economic loss. It was submitted that it follows that the only loss that could have been sustained by the plaintiff was the "economic loss which would be involved if and when the defect was actually discovered or became manifest, in the sense of being discoverable by reasonable diligence, with the consequence that the damage was then sustained by the then owner": Hawkins v Clayton(1988) 164 CLR 539at 588; Cyril Smith & Associates Pty Ltd v Owners - Strata Plan No 64970 [2011] NSWCA 181 at [8]-[14]; Scarcella v Lettice (2000) 51 NSWLR 302 at [13]-[24]. [219] The plaintiff submitted that the economic loss upon which she sues was consequent upon the emergence of the fact of the forgery and that is what brought the plaintiff's causes of action into existence. [220] It was submitted that this analysis is consistent with the statement of principle in Wardley Australia Ltd v Western Australia(1992) 175 CLR 514 that a plaintiff cannot be compelled to commence proceedings "before the existence of his or her loss is ascertained or ascertainable" (at 527). Whether the loss will ever eventuate and its extent will depend upon the defect being exposed. In this regard the plaintiff relied upon the following passage of Sackville J's judgment in Karedis Enterprises Pty Ltd & Greenfriars Pty Ltd v Antoniou(1995) 59 FCR 35at 47: In proceedings under s 52 and s 82 of the Trade Practices Act it is often the case that a purchaser acquires an asset on the faith of a false representation and that asset is shown, by subsequent evidence, to have been worth less at the time of the purchase than the price paid. It is also often the case that the purchaser, at the date of acquisition, neither knows nor has the means of knowing that the representations are false, nor that the business is worth less than the price paid. To use the language of the majority in Wardley, it would seem unjust to compel such a purchaser to institute proceedings before the existence of his or her loss is ascertained or ascertainable by that person. [221] The plaintiff submitted that in this case the open market sale of the Painting demonstrated its market value. There was a contingent risk that the fraudulent character of the Painting would be discovered in the future. It was when that risk came to pass that the loss was suffered. [222] The question is whether reasonable diligence by the plaintiff could have discovered the fact of the forgery at an earlier time… [223] The plaintiff submitted that her reasonable diligence could not have discovered the fact of the forgery before she was informed of the problems with the Painting in 2010. ….. [225] In my view the plaintiff did as much as could reasonably be expected in the circumstances to check the authenticity of the Painting. Even in 2010 when Mr Smith of Sotheby's alerted Ms Sharpe to the prospect that the Painting had a dubious provenance, it still took some weeks with very experienced experts analysing the background and provenance and inspecting the Painting for it to be withdrawn from the March 2010 auction. [226] However those with far more expertise than the plaintiff were duped for years. The defendants' claims that the plaintiff should have been able to identify the Painting as a forgery at an earlier time is not sustainable. [227] The plaintiff was blissfully ignorant of the defect in the Painting until Mr Smith viewed the Painting and discussed the difficult provenance with Ms Sharpe in early 2010. I am satisfied that reasonable diligence by the plaintiff could not have disclosed the fact of the forgery at an earlier time. [228] The plaintiff suffered loss when the defect in the Painting was discovered and it was withdrawn from the March 2010 auction. I am satisfied that the plaintiff's claims in respect of the Painting are not statute barred.
12. Accordingly, in our opinion, in circumstances where the defect or inferior composition or quality of goods purchased is latent, in the sense that it is not manifest or discoverable by reasonable diligence, the causes of action for misleading and deceptive conduct and false representation inducing the purchase of goods under s 68 of the FPA, to which we have referred, do not accrue until loss by diminution of value or other consequential loss (for example, incurring expense) eventuates because the defect or inferior aspect has become manifest, or could with reasonable diligence be discovered.
13. On the facts of this case, in our opinion, no such loss eventuated until, at the earliest, Ms Upton, following the inspection by experts for the Antique Roadshow, obtained the expert report from the gemmologists from AnchoCert that the stones were opal doublets and incurred the expense of their examination.
14. The doublet feature of the cuffs was hidden from view and only established by removal of stones and expert gemmologist inspection. It was not reasonable to expect a consumer to take such extreme steps before purchase. The fact that the valuer from A Simmons did not detect the issue provides further support for our conclusion that the truth was latent and not discoverable by reasonable diligence.
15. With respect to s 68 of the FTA, it is clear that Ms Upton has incurred some loss. She has incurred the expense of investigation of the true composition or quality of the stones. There is also an indication the cuffs were worth less than what she paid for them, based upon what Ms Hardy told Ms Upton. This accords with what would be expected given the inferior composition of the stones. Unless Ms Upton was obtaining what she understood to be solid black opals at a very low price, it would be expected that the value of the inferior cuffs would be less than the price she paid for them. However, a final conclusion on this point must await the assessment of damages to be undertaken.

Accrual of cause of action - negligent misrepresentation

1. For the like reasons as given in respect of the above claims under s 68 of the FTA, in our opinion, Ms Upton's cause of action in tort for negligent misrepresentation did not accrue until Ms Upton obtained the expert report from AnchorCert. With such a claim, damage is the gist of the action.

Accrual of cause of action - deceit

1. At the outset, we should say that on the evidence we have referred to and findings made, we do not infer that the representation as to the cuffs containing solid black opals was made fraudulently. For all we know, the Respondent obtained the cuffs and sold them to Ms Upton under the same impression that Ms Upton had about their composition. In this regard, we note that the insurance valuer used by Ms Upton did not identify the issue. The absence of evidence from the Respondent does not enable us to come to the very serious conclusion of deceit by the Respondent.
2. In our opinion, the time of accrual of a cause of action for the tort of deceit in this case was at the same time as the statutory claims under s 68 of the FTA and the claim for negligent misrepresentation. The same reasons apply.
3. Because reference was made to the issue in Ms Upton's submissions, we also note here that the limitation period for proceedings in the Tribunal does not include the postponement of the bar for fraud as contained in s 55 of the Limitation Act (1969) (NSW). An applicant in the position of Ms Upton would only be able to take advantage of that postponement in proceedings brought in a Court, although, because of the time when loss is first suffered on the facts in this case, the postponement provision for fraud would not appear to provide Ms Upton with any advantage over the position which applies in respect of her claims for damages under the TPA and in tort.

Error in relation to the time bar

1. Accordingly, in our opinion, the Tribunal at first instance in the first decision erred in concluding that the claim was brought outside the three year period in s 79L and that, as a consequence, it had no jurisdiction to deal with the claim. It ought to have concluded that it did have jurisdiction to deal with: 1. Claims under s 68 of the FTA for misleading and deceptive conduct and false representation in contravention of ss 42 and 44(a) of the FTA. 2. Claims in tort for negligent and fraudulent misrepresentation.
2. Further, in our opinion, for the above reasons, the Tribunal at first instance in the third decision erred in concluding that the statutory and tortious causes of action first accrued at the time of the insurance valuation in 2006.
3. No reasons for that conclusion in the third decision were given. Adequate reasons needed to refer to the competing evidence and set out the reasoning process for preferring the case for discoverability in 2006 compared to Ms Upton's account as to when and how she came to discover the cuffs were opal doublets. The absence of such reasons was an error of law.

Error in relation to loss

1. The Tribunal at first instance in the third decision concluded, as an alternative basis for decision, in brief reasons, that Ms Upton had not established her case on the merits. In this regard, the Tribunal concluded: … there is no evidence to substantiate the difference between black opals and black doublets and in particular, the difference, if any, in value."
2. We take it that what the Tribunal was referring to was that Ms Upton had not quantified her loss by evidence as to the amount of any difference in the value of what she received from the price she paid. As can be seen from the facts, there was ample evidence that opal doublets were an inferior item to opals and were a less valuable commodity.
3. In so concluding that Ms Upton had not established her case on the merits, in our opinion, the Tribunal at first instance erred because: 1. Ms Upton had established some loss, namely the costs associated with obtaining the gemmologists' report. This was sufficient to complete her causes of action in respect of misleading and deceptive conduct and in tort. It was an error of law not to consider this aspect of her case. 2. Ms Upton was saying to the Tribunal that she wanted to defer the question of loss because of uncertainty as to how it should be assessed. We have already made some remarks about her approach in this regard (paragraph 14). Her stance about this issue and argument needed to be considered and addressed in the reasons. Not to do so was an error of law. 3. Further, in our opinion, she should have been given the opportunity to provide evidence as to the difference between the value of the cuffs and the price paid for them, accompanied by some reference to the issue being a matter for the Australian market as at the date of purchase. The orders we propose will allow this error to be corrected.

Liability of the Respondent

1. As was contemplated by our procedural orders, in view of our conclusions of error, we propose to proceed to deal with the merits of Ms Upton's claim. It has already been necessary for us to make findings concerning the merits of her claim in examining the time bar issue (in paragraph 12).
2. Based upon those findings, in our opinion, Ms Upton has suffered, at least, some loss (as we have already mentioned) by reason of contraventions by the Respondent of the FTA to which we have referred.
3. In our opinion, each of the provisions to which we have referred was contravened because it was false to represent that the cuffs contained solid black opals. It was false and misleading to represent that the cuffs were set with black opals, as reflected in the invoice, in circumstances where that was only partly true and the whole truth would have revealed items of substantially inferior quality. These were representations about the composition and quality of the goods.
4. We have already said that we reject the claim that the representations were made fraudulently. It is unnecessary for us to decide whether they were made negligently.

Outcome of the appeals

1. For the above reasons, the first decision should be set aside. Once that decision is set aside, the primary foundation for the third decision, based as it was upon the subject matter having already been adjudicated by the first decision, falls away. In any event, there was appealable error in relation to the alternative grounds for decision in the third decision. For those reasons, the third decision should be set aside. In the circumstances, the appeal against the second decision is otiose and should be dismissed.

Orders on the appeals

1. Accordingly, we make the following orders: 1. Allow the appeals from the decisions of the Tribunal at first instance in file numbers Gen 15/58450 and Gen 15/67511. 2. Set aside the decisions of the Tribunal at first instance in file numbers Gen 15/58450 and Gen 15/67511. 3. Order that the Appellant's claim in file number Gen 15/58450 be remitted to the Tribunal at first instance for assessment of the amount to be paid by the Respondent to the Appellant pursuant to s 79N (a) of the Fair Trading Act 1987 (NSW) on the basis of the Respondent's contraventions of ss 42 and 44(a) of the FTA as described in these reasons. 4. The Tribunal to whom the matter referred to in Order 3 is remitted, is to make directions for the provision by the parties of evidence in relation to the matter remitted. 5. The appeal from the decision of the Tribunal at first instance in file number Gen 15/62147 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: 17 October 2016