Wilson v Chan & Naylor; Wilson v Chan & Naylor Parramatta Pty Ltd atf Chan & Naylor Parramatta Trust

Summary of the 20 June Decision

1. The following is a summary of the 20 June Decision: 1. On 27 September 2017, the appellant filed an application for an order that Kenneth Raiss be joined as an additional respondent to the proceedings which had just been transferred back to the Tribunal. On 17 October 2017, Mr Raiss was joined as a respondent. Accordingly, any time limitation must be related to that date; 2. The appellant had filed points of claim and they alleged that Mr Raiss provided investment and financial advice on 20 October and 8 November 2005 and that the last contact between the appellant and Mr Raiss was, according to the appellant's statutory declaration, on 7 March 2006. The 20 June Decision was based upon the finding contained in [46] that the joinder of Mr Raiss in October 2017 occurred more than 10 years after the last occasion on which Mr Raiss provided services to the respondents and that had the effect of denying the Tribunal jurisdiction. Even if the cause of action arose in 2013 (being the alternative consideration under s 79L of the FT Act), the period under s 79L(1)(a) has not been complied with; 3. With respect to the claim for costs by Chan & Naylor Pty Ltd, Edward Chan and David Naylor and the separate claim for costs brought by Kenneth Raiss, the Tribunal considered the application of s 60 of the Civil and Administrative Tribunal Act 2013 (NCAT Act); 4. The Tribunal found that the conduct of the appellant in joining parties "against whom there was no reasonable cause of action caused them to seek legal advice and incur unnecessary expense" ([53]). In this respect, those four parties were "unnecessarily disadvantaged" and that when one has regard to the time limits provided for under the FT Act there was "no tenable claim" that could have existed against any of the four respondents joined in October 2017 ([53]). In addition, the proceedings involved some complexity and that complexity was sufficient to invite those parties to avail themselves of the leave granted to obtain legal representation. The Tribunal also found that the proceedings were misconceived or lacking in substance within the meaning of s 60(3)(e) of the NCAT Act; and 5. The Tribunal said it was preferable to assess costs in this instance, rather than to have the parties incur additional costs of assessment by a costs assessor. The Tribunal said that taking all matters into account, the appellant should pay costs as assessed by the Tribunal. The orders made have been set out earlier in this decision.

Summary of the 29 June Decision

1. The following is a summary of the 29 June Decision (in which Chan & Naylor (Parramatta) Pty Ltd as trustee was the first respondent and H Brisbane the second respondent): 1. The 29 June Decision records that the claim against the first respondent was first lodged on 2 November 2015 and against the second respondent on 17 October 2017. The Tribunal took into account the points of claim filed by the applicant (i.e. the appellant) on 20 October 2017 and the applicant's reply to the request for particulars on 10 May 2018. The appellant's claim is for a money order under s 79N of the FT Act. The amount claimed is $29,975.00; 2. The points of claim and reply to the request for particulars indicate that the appellant's claim is based in part on having to repay "the Property trust" following non-compliance with the Superannuation Industry (Supervision) Act (SIS Act) and/or the Superannuation Industry (Supervision) Regulation (SIS Reg); 3. The application of the respondents seeking summary dismissal of the appellant's applications must be determined by reference to the test to be applied in summary dismissal applications as stated in the decision of Shaw v State of New South Wales [2012] NSWCA 102. This involves determining that the claims are so obviously untenable or groundless that there is a high degree of certainty they will fail. In the particular context in which the applications for dismissal are raised, the issue does not concern the merit of the claims alleged against the respondents, but rather whether the claims may fail in the Tribunal by reason of the jurisdictional limits imposed by s 79L of the FT Act. In other words, the claims may succeed in a Court which is not restricted by s 79L; 4. The cause of action was the advice given by the respondents to set up the structure which the appellant did set up and advice to purchase a property using that structure which the appellant purchased. That advice predated the establishment of the structure and purchase of the property which took place in 2006. Therefore, even if the second respondent gave advice concerning the establishment of the structure or the purchase of the property, that occurred more than 10 years ago (i.e. more than 10 years prior to the filing of the application against the second respondent in October 2017); 5. If the cause of action first accrued when the appellant's loss was measurable and when the loss was first suffered by the appellant, that occurred when the appellant first started receiving rent from the property and allowing the Super Fund to pay the interest on the loan from the lender, the Iden Group. This occurred from the time interest payments were made in late 2006 and from the time when rent payments were received, which was prior to November 2012. The losses were measurable by those first payments and receipts of rent and the cause of action first accrued as at those dates. Those dates are before 11 November 2012 for the first respondent and before 17 October 2014 for the second respondent. Accordingly, the claims are statute barred under s 79L(1)(a) of the FT Act; 6. The applicant (now appellant) argues that the advice was negligent and a breach of the ACL because the advice did not comply with the SIS Act and SIS Regs referred to earlier, leading the appellant to contravene that legislation. That means the Tribunal cannot hear and determine the dispute, as to do so would require the Tribunal to consider and apply Commonwealth legislation. The Tribunal has no jurisdiction to do so (Qantas Airways Limited v Lustig [2015] FCA 253); and 7. The claims against the respondents are out of time and the Tribunal has no jurisdiction to consider and apply Commonwealth legislation.

The hearing of the Appeals on 2 October 2018

1. Following the filing of the Notices of Appeal, the respondents to the appeals filed Replies to Appeal. In addition, following the making of directions, the parties to the appeals filed submissions. We will refer to these later in these reasons.
2. At the hearing of the appeals on 2 October 2018, the appellant made oral submissions which may be summarised as follows: 1. Both the 20 June Decision and the 29 June Decision contain inadequate reasons and there has been a failure to provide adequate reasons; 2. The appellant seeks to have the proceedings transferred to the District Court on the basis that the Tribunal does not have jurisdiction. We note that all respondents indicated that they opposed an order for transfer to the District Court; 3. Both decisions contained factual errors relevant to the final decision dismissing the application. Mr Raiss provided a service in 2011, Mr Brisbane in 2012 and Chan & Naylor in 2013; and 4. The applications were lodged within the three year time limit from the date the causes of action accrued. The assertion that Mr Raiss provided a service in 2011 was not contained in the points of claim but was contained in a statutory declaration provided to the Tribunal, being a declaration of Mr Mendonca.
3. With respect to the appeal from the costs orders made in the 20 June Decision, all parties agreed that they would not make oral submissions and that the Tribunal ought to make its decision on the papers (i.e. based upon the written submissions filed by the parties in the appeals).
4. At the appeal hearing, Mr Elliott of counsel handed up a structure diagram (without objection from the other parties) and gave a brief description of the advice and transactions which had given rise to these proceedings. In summary, Grey Gum Superannuation fund (GGSF) and Grey Gum Property Trust (GGPT) entered into a joint venture agreement. They (or one of them) purchased a property in Queensland. GGSF provided $75,000.00 to purchase the property and the balance was provided by a lender, Iden Group. Under the joint venture, GGPT was to pay the mortgage, and rent received from the property (following the building of a residential home on the property) was to be shared between GGPT and GGSF. The management of the way in which the mortgage payments occurred and rental income was shared was such as to constitute a breach of the relevant superannuation legislation.
5. Mr O'Neill submitted that if the Tribunal were to hear the application, it would be necessary for the Tribunal to consider, interpret and decide whether or not the operation of the trusts had breached the relevant superannuation law being Commonwealth legislation. That essentially would involve the Tribunal finding that the appellant and those associated with the appellant had breached Commonwealth legislation. The Tribunal is not a Court under Ch III of the Constitution and therefore cannot exercise jurisdiction to determine a breach of Commonwealth legislation.
6. Mr O'Neill also referred to a decision of the Appeal Panel of the Tribunal (see Johnson v Dibbin; Gatsby v Gatsby [2018] NSWCATAP 45) which held that the Tribunal is a Court. That decision went on appeal and the Court of Appeal reserved its decision. He submitted that it would be appropriate for this decision to not be delivered until such time as the Court of Appeal hands down its decision.
7. The appellant made submissions in reply disputing some aspects of the factual matters provided by Mr Elliott as to the operation of the trusts. Mr Wilson was not able to state what the precise nature of the non-compliance of superannuation legislation was. However, he had become concerned about non-compliance and decided to sell the property. He drew attention to an advice from Sladen Legal, to the effect that the arrangements entered into were illegal.

Directions made on 2 October 2018

1. During the course of the appeal hearing it became apparent that two folders of material which the appellant had requested be couriered to the Tribunal had not in fact been delivered. Accordingly, we reserved our decision and the following directions were made at the end of the appeal hearing: 1. The appellant is directed to provide two copies of the two folders to the Tribunal, such copies to be lodged within 7 days; and 2. The respondents are directed to inspect the two folders at the Registry within 7 days thereafter for the purposes of ensuring that those folders contain material already supplied to the respondents.
2. The above directions were complied with and we have considered the two folders provided by the appellant.
3. It is convenient to consider the appeal from 20 June Decision first and the other appeal later in these reasons.
4. We enquired of the parties what orders should be made if we were to dismiss the appeals. In particular, should we order that the applications be transferred to a Court of competent jurisdiction? We were referred to the decision in The NTF Group Pty Ltd v PA Putney Finance Australia Pty Ltd [2017] NSWSC 1194. We enquired whether it would be appropriate to transfer the proceedings to the Supreme Court in view of the fact that there appeared to be some controversy as to whether the District Court had jurisdiction to consider and make determinations with respect to Federal legislation. The Appellant submitted that if we held that the Tribunal lacked jurisdiction, we should transfer the application to a Court with jurisdiction. The respondents submitted we should dismiss the appeals.

Attorney General for New South Wales v Gatsby

1. On 6 November 2018 the Court of Appeal delivered judgment in Attorney General for New South Wales v Gatsby [2018] NSWCA 254. The Court held that NCAT was not a Court of a State within the meaning of s 39(2) of the Judiciary Act 1903 (Commonwealth) and s 77 (iii) of the Constitution. This conclusion has the consequence that NCAT cannot exercise Federal jurisdiction. Only a Federal Court or a Court of a State may be conferred with Federal jurisdiction. If the application brought by the appellant involves the exercise of Federal jurisdiction, then NCAT is unable to determine the matter. Instead, it must dismiss the appellant's application or transfer the application to a State Court or a Federal Court.
2. These issues were the subject of consideration in the Federal Court of Australia in Qantas Airways Limited. There it was argued that the Victorian Tribunal (known as VCAT) could not determine a dispute between the applicants and Qantas because to do so would involve the exercise of Federal jurisdiction by VCAT which was held not to be a Court of a State. That judgment summarised the principles by which it is determined whether a matter arises under a law of the Commonwealth and its implications for the determination of the matter.
3. Paragraphs 80, 81 and 82 are relevant and are set out below: 80. First, a matter arises under a federal law "if the right or duty in question in the matter owes its existence to federal law or depends upon federal law for its enforcement, whether or not the determination of the controversy involves the interpretation (or validity) of the law.": LNC Industries Ltd v BMW (Australia) Ltd [1983] HCA 31; (1983) 151 CLR 575 (LNC Industries) at 581 (Gibbs CJ, Mason, Wilson, Brennan, Deane and Dawson JJ) (quoting with approval R v Commonwealth Court of Conciliation and Arbitration; ex parte Barrett (1945) 70 CLR 141 at 154 (Latham CJ)). As their Honours further explained, this does not mean that the question turns on the form of relief sought or even upon whether the relief depends on federal law (ibid). Thus even if, as in LNC Industries, a claim is made for relief of a kind available under State law (e.g. for damages for breach of a contract) the claim will arise under federal law if the contract is in respect of a right or property (e.g. a trademark) which is the creation of federal law. Equally, a matter arises under federal law "if the source of a defence which asserts that the defendant is immune from the liability or obligation alleged against him is a law of the Commonwealth": LNC Industries at 581 (emphasis added). 81. Secondly, federal jurisdiction is plainly attracted where the right or duty based in federal law "is directly asserted by the plaintiff or defendant", even though it may also exist in other cases such as where the court finds it necessary nonetheless to decide whether or not a right or duty based in federal law exists: Moorgate Tobacco Co Ltd v Phillip Morris Ltd (1980) 145 CLR 457 (Moorgate) at 476 (Stephen, Mason, Aickin and Wilson JJ (Barwick CJ agreeing at 467)). 82. Thirdly, once a federal defence is raised in a court vested with the judicial power of the Commonwealth, the whole of the matter is determined by it in the exercise of federal judicial power unless there is some completely disparate claim constituting in substance a separate proceeding: Felton at 373 (Barwick CJ); Moorgate at 476 (Stephen, Mason, Aickin and Wilson JJ (Barwick CJ agreeing)); Sunol at 621 [7] (the Court). As Mason, Murphy, Brennan and Deane JJ explained in Fencott v Muller [1983] HCA 12; (1983) 152 CLR 570 (Fencott) at 606: …the ambit of a matter arising under a federal law may extend beyond claims which arise under that law or which are to be determined by reference to that law alone. As Windeyer J said in Felton v Mulligan (1971) 124 CLR 367 at 393: "The existence of federal jurisdiction depends upon the grant of an authority to adjudicate rather than upon the law to be applied or the subject of adjudication."
4. Here, the appellant's Points of Claim alleged: 1. That one of the respondents, Mr Raiss, without holding the appropriate license gave investment and financial advice to set up and operate a self-managed superfund and invest superfund retirement savings in a joint venture (par 6); 2. The respondents (or some of them) failed to give advice concerning the effect of a view held by the Australian Taxation Office (ATO) contained in publications identified as ATO ID 2006/335 (par 13) and SMSFR 2009/4 (par 17); and 3. The respondents gave "bad advice" and failed to warn the appellant about the risks for the appellant if the view of the ATO was found to be correct (par 33).
5. In our view, the allegations involve the assertion of a duty held by the respondents (or some of them) owed to the appellant to give advice concerning Federal law (in particular the law concerning Federal taxation and the management of superannuation entities which are regulated by Federal law). A consideration of that duty involves a consideration of Federal law.
6. As a consequence, the points of claim involve the exercise of Federal jurisdiction and the Tribunal is not, in our view, vested with power to determine such dispute.
7. Notwithstanding the above conclusion, it is still necessary to consider the two appeals in further detail.

Grounds of Appeal and Appellant's submissions concerning the 20 June Decision

1. The Grounds of Appeal may be summarised as follows: 1. The appellant was denied procedural fairness; 2. The Tribunal erred in "seeking an agreement on costs payable to Ken Raiss" before the appellant had a fair opportunity to consider limitation law and jurisdiction submissions of Ken Raiss; 3. The Tribunal erred in granting leave to Mr Della Marta to represent Chan & Naylor Pty Ltd, David Naylor and Edward Chan after the claim against his clients was withdrawn and erred in finding special circumstances existed and erred in the exercise of the discretion to award costs; and 4. The Tribunal erred in finding that the Tribunal lacks jurisdiction, and erred in not transferring the proceedings to a Court, erred in deciding the application of Mr Raiss on the papers, erred in failing to "consider the necessity for a factual finding" and erred in certain findings of fact.

Reply of Chan & Naylor Pty Ltd, David Naylor and Edward Chan (the Three Respondents)

1. The Reply of the above (the "three respondents) may be summarised as follows: 1. The Tribunal did not deny the Appellant procedural fairness; 2. The solicitor sought and obtained leave to appear for the three respondents on 19 January 2018. He had prepared submissions concerning jurisdiction and costs. The three Respondents had obtained leave to be represented in October 2017. The Appellant did not withdraw the application against the three respondents prior to January 2018; 3. The Tribunal did not err in finding that special circumstances existed for the purposes of awarding costs; 4. The Appellant does not assert that the costs awarded were excessive and the Tribunal has not erred in exercising its discretion; and 5. The Appellant should be ordered to pay costs of the appeal.

Reply of Mr Raiss

1. The Reply of Mr Raiss may be summarised as follows: 1. The Appellant was afforded procedural fairness; and 2. The Appellant had an opportunity to withdraw the claim but chose to proceed. There was no error in the decision to award costs and there was no error in the decision that the Tribunal did not have jurisdiction.

The Appellant's submissions concerning the three Respondents and Mr Raiss

1. The Appellant's submissions are summarised as follows: 1. When Mr Raiss was joined in October 2017, he did not raise the question of the Tribunal lacking jurisdiction; 2. On 19 January 2018, the Appellant withdrew the application against the three respondents; 3. The 20 June Decision was delivered in the absence of the Appellant; 4. If the Tribunal has no jurisdiction to consider the Appellant's application, then the order of the District Court made on 8 September 2017 transferring the applications to the Tribunal is a nullity as the District Court lacked jurisdiction to make that order; 5. If the Tribunal has jurisdiction to consider and apply Federal laws, then the Tribunal was in error in holding that the claim against Mr Raiss was not brought within the 10 year period required by s 79L of the FT Act. The last service rendered by Mr Raiss was in April 2011; 6. The three respondents knew that the District Court transfer order was a nullity and concealed that from the Tribunal. They should have informed the Tribunal in October 2017 of the fact that the order was a nullity and had they done so, they would not have incurred further costs; 7. The Tribunal did not give the Appellant the opportunity to make written submissions on 19 January 2018 opposing the granting of leave for the three respondents and Mr Raiss to have legal representation. Had that opportunity be afforded, the Tribunal would not have granted leave; 8. The Appellant was not afforded the opportunity to make oral submissions that the transfer by the District Court was a nullity; 9. The Tribunal was in error in "seeking an agreement" for the Appellant "to pay costs to obtain an opportunity to reply" instead of declaring the District Court orders a nullity; 10. The respondents' conduct in not objecting to the transfer by the District Court disentitles them to costs. They unnecessarily disadvantaged the Appellant; 11. The Tribunal erred in finding that the application had no tenable bases and lacked substance in fact or law because the proceedings can continue in the District Court; 12. The failure of the Tribunal to allow the Appellant to cross-examine Mr Raiss constitutes a denial of procedural fairness. Had cross-examination been allowed, he would have established that Mr Raiss gave advice to Mr Mendonca on about 20 April 2011. In any event the statutory declaration of Mr Mendonca dated 19 April 2018 referred to advice received from Mr Raiss in April 2011; and 13. Had the proceedings been properly conducted a different result would have occurred, namely, the transfer ordered by the District Court would have been declared void and the proceedings would have continued in the District Court. Nor would costs have been awarded.

Respondents' submissions and the Appellant's submissions in Reply

1. It is not necessary to set out these submissions in this decision. It is sufficient to say that we have considered these submissions.
2. However, Mr Raiss' submissions contain the following: 1. The statutory declaration of Mr Mendonca (which suggests that Mr Raiss last provided services to the Appellant around 20 April 2011) does not annex the emails relied upon and none of the emails relied upon were received by Mr Mendonca from Mr Raiss directly; and 2. The evidence of the Appellant is that the last direct communication of advice from Mr Raiss occurred in March 2006.

Decision with respect to the Appeal from the 20 June Decision (AP 18/30837)

1. It is necessary to set out the chronology of relevant events: 1. The Appellant commenced proceedings in the Tribunal in 2015. The respondent was Chan & Naylor Parramatta Pty Ltd as trustee. Later, Mr Brisbane became the second respondent; 2. On 6 February 2017, the Tribunal ordered that the application be transferred to the District Court because the amount the Appellant claimed was an amount greater than the limit of the Tribunal's power to order; 3. On 8 September 2017, the District Court made an order by consent transferring the proceedings to NCAT; 4. On 17 October 2017, the application was listed before the Tribunal and at the request of the Appellant, 10 new respondents were joined to the proceedings. They included the three respondents and Mr Raiss. In addition, the Appellant was given leave to amend the application by 31 October 2018 and directed to provide submissions concerning the Tribunal's jurisdiction. Specifically, the Appellant was directed to file and serve Amended Points of Claim by 31 October 2017 and the respondents directed to file and serve Points of Defence by 12 December 2017; 5. On 19 January 2018, the Tribunal held a directions hearing and, at the Appellant's request, the Tribunal ordered that seven respondents be removed as respondents leaving only Chan & Naylor Parramatta Pty Ltd, H Brisbane and K Raiss. The Tribunal noted that the three respondents had been legally represented following their joinder on 17 October 2017 and that their solicitor had made written submissions concerning costs. The Tribunal made directions for the Appellant to make written submissions and noted that the "costs application will be determined on the papers". Directions were also made concerning the remaining respondents' application for orders that the applications be dismissed for lack of jurisdiction and that they may request particulars of the losses claimed. Leave was granted for all parties to be represented; and 6. On 29 March 2018, the Tribunal conducted another directions hearing. The Tribunal noted that Mr Raiss had filed submissions seeking a dismissal for want of jurisdiction, and that the Appellant wanted to provide submissions and "has agreed to pay the costs thrown away by Mr Raiss in the event that the respondent's application is successful". Directions were made for submissions to be filed and the Tribunal recorded that it intended to consider the application on the papers.

Order 1

1. It is convenient to consider the appeal concerning Order 1 first. The facts are not controversial. The three respondents were first joined to the application on 17 October 2017. At the directions hearing on 19 January 2018, the Appellant agreed to the removal of the three respondents.
2. The Appellant submitted that he was denied procedural fairness by the Tribunal granting the three respondents leave to have legal representation in that the Tribunal failed to give the Appellant an opportunity to make written submissions opposing the grant of leave. The Appellant concedes he was given the opportunity to make oral submissions.
3. The Appellant's submissions do not state what he would have submitted in writing which was not said orally. In addition, he did not appeal the decision granting leave. In our view, there was no denial of procedural fairness. It is difficult to imagine what the Appellant could have said that would have altered the Tribunal's decision.
4. The Appellant submitted that he was going to withdraw his claims against the three respondents at the same time as leave was granted. That submission fails to address the fact that after the three respondents were joined in October 2017, they were entitled, if they wished, to seek legal advice. Once the proceedings were withdrawn, they were entitled to make an application for the costs they incurred to be paid, provided they established special circumstances under s 60 of the NCAT Act. For the purpose of making an application for costs following the withdrawal, they sought and obtained leave to be represented. The mere fact that the claims against them had been withdrawn does not disentitle them to representation.
5. The submissions that the three respondents knew that the District Court order was a nullity and had a duty to inform the Tribunal is rejected. The respondents were not present when the District Court made its orders. The Appellant sought leave to amend his claim. Therefore, when the Appellant sought to amend his claim, they were entitled to wait and see what that amended claim contained. They apparently sought advice from a solicitor who sought leave to appear on 19 January 2018. It is clear that the purpose of having leave was to enable the three respondents to put their submissions on jurisdiction and for costs via their solicitor.
6. Under s 50 of the NCAT Act, the Tribunal may decide to determine a matter based on written submissions if the parties have been afforded an opportunity to make submissions. The Tribunal foreshadowed deciding the questions of costs on the papers and there was no objection. Nothing has been submitted to show that that course was procedurally unfair.
7. The Appellant made the decision to discontinue the claim against the three respondents. The Tribunal concluded that the application had no tenable basis and/or lacked substance and/or that the respondents were unnecessarily disadvantaged. Although several bases were relied upon by the Tribunal for the finding that special circumstances existed, only one was necessary. The finding that the three respondents were unnecessarily disadvantaged was sufficient (see s 60(3)(a) of the NCAT Act). Their conduct in obtaining legal advice was reasonable and the costs they incurred were unnecessary once the Appellant elected to discontinue the application against them.
8. The fact that costs may have been incurred before leave for legal representation was granted does not of itself disentitle the three respondents to an order for their costs to be paid.
9. The appeal in respect of Order 1 must fail and an order dismissing the appeal in that respect will be made.

Orders 2 and 3

1. We will now consider the appeal in respect of Orders 2 and 3. These concern the dismissal of the claim against Mr Raiss and the order that his costs be paid by the Appellant.
2. We reject the ground that the Appellant was denied procedural fairness.
3. The Appellant was given the opportunity to make written submissions and did not object to the Tribunal's foreshadowed directions to determine the application on the papers.
4. We reject the submissions that Mr Raiss should have raised the issue of the Tribunal's lack of jurisdiction at an earlier stage. He was not joined until October 2017, when the Appellant was given leave to amend the claim. He was entitled to wait and see what the amended claim contained. After the claim was amended, Mr Raiss foreshadowed on 19 January 2018 an application for dismissal, but the Appellant elected not to withdraw the claim against Mr Raiss (as he did with respect to the three respondents). Neither Mr Raiss' conduct nor the procedure of the Tribunal give rise to a sound ground of appeal.
5. The alleged denial of an opportunity to make written submissions opposing Mr Raiss' application for leave to be legally represented does not constitute a denial of procedural fairness, because the Appellant was given the opportunity to make oral submissions and he has not identified what written submissions he could have made which could have produced a different outcome.
6. The Appellant has submitted that, if the Tribunal lacked jurisdiction, the transfer ordered by the District Court was a nullity. We reject that submission for three reasons. First, the District Court order was an order made by consent, in the exercise of the Court's jurisdiction to make transfer orders. No finding was made by the District Court as to whether the Tribunal had jurisdiction. That was a matter for the Tribunal to determine following the transfer. Secondly, the Tribunal allowed the Appellant to amend his claim and, accordingly, the two decisions under appeal involve a finding that the amended claims were not within the Tribunal's jurisdiction, not a finding as to the claim as it was prior to the transfer order. Thirdly, the limitation imposed by s 79L concerns the Tribunal's jurisdiction "to hear and determine a consumer claim". An application may be commenced in the Tribunal, or come to the Tribunal by order of another Court, and after the application is before the Tribunal, a decision may be made that the Tribunal cannot hear and determine the application. That outcome does not mean that the filing of the application was a "nullity" or that the order transferring the application to the Tribunal was a nullity in the sense that the filing of the application or the making of an order has no effect. Indeed, the NCAT Act expressly gives power to the Tribunal to determine whether it has jurisdiction: see ss 4 and 29(2) of the NCAT Act.
7. We reject the ground of appeal that the Tribunal sought an agreement on costs payable to Mr Raiss. The record of the hearing on 29 March 2018 in this respect has been quoted earlier. The Tribunal did not find that the appellant had agreed to pay Mr Raiss' costs if the application for dismissal foreshadowed by Mr Raiss was successful. What the Tribunal did was to find that special circumstances existed justifying an order for costs under s 60(2) and (3) of the NCAT Act, not because the appellant agreed to pay costs. The appellant has not demonstrated a basis warranting the setting aside of Order 3.
8. We refer to the ground of appeal that the Tribunal erred in deciding that the Tribunal lacked jurisdiction to hear and determine the application against Mr Raiss. We read the 20 June Decision as finding that both the 10 year limitation and the three year limitation required by s 79L were not satisfied: see par 46 where it is said that the joinder of Mr Raiss occurred more than 10 years after any services were provided and that even if the cause of action arose in 2013, the three year requirement of s 79L has not been complied with. This meaning is clear having regard to the recitation of the submissions made on behalf of Mr Raiss recorded in paragraphs 22, 44 and 45 of the 20 June Decision.
9. Section 79L operates to deny the Tribunal jurisdiction if either the three year (s 79L(1)(a)) or the 10 year (s 79L(1)(b)) requirement is not satisfied. However, for the reasons described in the following paragraph, it is not necessary for us to decide if the Tribunal correctly applied s 79L of the FT Act to the facts alleged.
10. We are of the view that the appellant seeks to invoke Federal jurisdiction and that therefore the Tribunal has no power to determine the dispute. There is no need to determine whether the 20 June Decision was correct in its consideration of s 79L of the FT Act.

Appropriate Order

1. The question arises whether we should simply dismiss the appeal, or dismiss the appeal in respect of the appeal concerning orders 1 and 3 (i.e. the costs orders), but in respect of Order 2, transfer the claim against Mr Raiss to a Court that has jurisdiction in accordance with the power provided to the Tribunal under cl 6 of Sch 4 of the NCAT Act.
2. In our view, the Tribunal may transfer proceedings before it to a Court notwithstanding that the Tribunal does not have jurisdiction to hear and determine the application. The respondents submitted the contrary, relying upon the decision in Qantas Airways Limited. In that case, Perry J said that if the Tribunal has no jurisdiction over any part of the proceedings, there is no matter before it to refer to a Tribunal or Court (#108). However, at #109, her Honour said that it was possible for a State to have legislated to confer powers on the Tribunal to transfer part or all of proceedings instituted in the Tribunal, but over which it lacks jurisdiction, to another Court or decision-making body. Her Honour went on to say that there was nothing conferring such power in the relevant legislation (that is the legislation providing powers to the Victorian Tribunal known as VCAT). In our view, in the case of NCAT the position is different. Clause 6 of Sch 4 of the NCAT Act enables NCAT to transfer proceedings to a Court that has jurisdiction in the matter. That power arises if the parties agree to the proposed transfer, or if the Tribunal of its own motion, or on the application of a party, so directs.
3. Accordingly, the appropriate order given our decision as recorded above, is either to dismiss the appeal or to order, in respect of the claims against Mr Raiss, that the proceedings be transferred to a Court of competent jurisdiction. We will return to that question later in these reasons.

Order 3

1. We turn to Order 3 (requiring Mr Raiss costs to be paid) The Appellant's submissions and those of Mr Raiss have been considered in the context of considering Order 1. For the same reasons we dismiss the appeal in respect of Order 3.

Costs of the Appeal

1. Given that the appeal is in substance to be dismissed, the further question is whether we should order the respondents' costs of the appeal to be paid by the Appellant. The respondents seek an order for costs. The Appellant has provided submissions opposing an order that he pay the respondents' costs. In particular, the Appellant says that if the Tribunal transfers the proceedings to a Court of competent jurisdiction, costs should not be awarded as he has been, in effect, successful. We reject that submission. In our view, it cannot be said that the Appellant has been successful against the three respondents (i.e. those in respect of whom the Appellant withdrew his claim) and those respondents have been put to further unnecessary expense in being involved in this appeal. In our view, there are special circumstances of the kind contemplated by s 60 of the NCAT Act justifying an order for the costs of the appeal incurred by those three respondents to be paid by the Appellant. In particular, the appeal has unreasonably prolonged the time taken to complete the proceedings against those three respondents, and the appeal has lacked substance. Accordingly, given our finding of special circumstances, we propose to make an order that the costs of the three respondents in the appeal be paid by the Appellant.
2. Turning to the costs of Mr Raiss, the position is that he has been successful in substance in upholding the decision that the Tribunal lacks jurisdiction. Although we intend to make an order that the proceedings against him be transferred to a Court, the position is, in our view, that Mr Raiss has, in these appeal proceedings, incurred unnecessary expense, and that the appeal has lacked substance. Accordingly, we find that special circumstances exist and we propose to make an order that his costs of the appeal by paid by the Appellant.

Grounds of Appeal and Reply concerning the 29 June Decision

1. The Appellant's grounds of appeal may be summarised as: 1. The Tribunal denied the Appellant procedural fairness; and 2. The Tribunal erred in finding that it lacked jurisdiction and that if it lacked jurisdiction, erred in not transferring the proceedings to a Court of competent jurisdiction.
2. The Notice of Appeal states that the Appellant requires an order that the proceedings be transferred to a court of competent jurisdiction if the Appeal Panel finds that the Tribunal lacked jurisdiction.
3. The Reply of the first respondent made by summarised as follows: 1. The first respondent denies that the Appellant was not afforded procedural fairness; 2. There was no error in the Tribunal's finding that it lacked jurisdiction; and 3. The Tribunal did not err in not transferring the proceedings to a Court of competent jurisdiction and lacked jurisdiction to do so.
4. The Reply to appeal filed by the second respondent may be summarised as follows: 1. The first respondent denies that the Appellant was denied procedural fairness; 2. The Tribunal did not err in finding that it lacked jurisdiction; and 3. With respect to the ground that the Tribunal erred in not transferring the proceedings to a Court of competent jurisdiction, the first respondent submitted that the Appellant did not seek to have the proceedings transferred to such a Court.

Appellant's Submissions

1. The Appellant's submissions in support of this appeal partly replicate those submissions made with respect to the appeal from the 20 June Decision. However, in some respects, these submissions contain additional material and we summarise the additional matters as follows: 1. The last service rendered by the second respondent (Mr Brisbane) was on 20 November 2012 and the last service rendered by the first respondent (Chan & Naylor Parramatta Pty Ltd) was in April 2013. The first actual loss suffered by the Appellant was on 22 April 2015, "when actual selling price was known on exchange of contracts"; 2. The cause of action can only accrue when "the actual selling price" of the Appellant's investments "is known on exchange of contracts". The Appellant relied upon Scarcella v Lettice [2000] NSWCA 289 where the Court of Appeal said that potential or contingent damage does not qualify as actual damage for the purpose of determining when the cause of action first accrues. Actual damage must be sustained. For the cause of action to be complete, the actual damage must be measurable and be beyond what can be regarded as negligible; 3. The Appellant submitted that the report of Moore Stephens states that before 22 April 2015 the loss was measurable but the measurable loss was potential or contingent, not actual. The only measurable loss that was not a potential loss was the actual loss quantified on 22 April 2015 when the actual selling price of investments in units of the trust was determined on exchange of contracts. Hence the three year period starts only from 22 April 2015.

Submissions of the First Respondent

1. The submissions of the first respondent may be summarised as follows: 1. The appellant's claim was a claim for pure economic loss as a result of alleged negligent advice. That advice concerned the establishment of a self-managed superannuation fund used to acquire real property; 2. Ground 1 of the appeal (which concerns the submission that the appellant was denied procedural fairness in denying the appellant the opportunity to make submissions about the nullity of the order made by the District Court transferring the application to the Tribunal) does not require a response as it concerned the application against Mr Raiss; 3. Ground 2 (which concerns the submission that the first respondent failed to make submissions about the order of the District Court transferring the application to the Tribunal) is disputed. The appellant had an opportunity to satisfy himself that the Tribunal had jurisdiction and he consented to the transfer; 4. Ground 3 (which alleges that the Tribunal erred in joining additional respondents) is misconceived, in that the Tribunal was not in a position without hearing from the parties to determine that it did not have jurisdiction; 5. Ground 4 (which concerns the submission that the Tribunal erred in permitting other respondents to have separate representation) is misconceived; and 6. Ground 5 (which concerns any other errors or grounds that the Appeal Panel may identify) is misconceived.
2. The appellant has failed to identify any error of law and the appeal is without merit. The first respondent seeks costs of the appeal.

Reply of the Appellant

1. In the appellant's reply submissions, the appellant alleges that Clive Nelson of the first respondent gave financial advice to the appellant on 20 March 2013 and 10 April 2013 to "continue making ongoing investments and to create backdated documents making the financial advice compliant". Accordingly, the ten year and the three year requirements of s 79L of the FT Act are satisfied.
2. The appellant also submitted that if the Tribunal decides that it does not have jurisdiction, it should transfer the proceedings to the District Court. The appellant says that he should not have to pay the first respondent's costs as it was legally represented and it should have been able to file its submissions on jurisdiction earlier than it did do so.

Decision with respect to the Appeal from the 29 June Decision (AP 18/30848)

Decision with respect to the claim against the first respondent

1. It is not necessary in our view for us to consider the issues raised in the submissions concerning s 79L of the FT Act. This is because of the view, expressed earlier, that the Tribunal has no jurisdiction to determine the issues in dispute (Qantas Airways Limited).
2. However, in our view it is generally not appropriate to deal with jurisdictional issues on a summary basis. The Tribunal assessed the alleged facts for the purposes of considering the operation of s 79L of the FT Act by reference to the points of claim and responses to the request for particulars as well as the statutory declarations. In our view, all of the facts that may have been more developed and found at a final hearing were not necessarily before the Tribunal when it determined the applications on a summary basis. It is appropriate to repeat the warning offered by the High Court in Wardley Australia Ltd v Western Australia [1992] 175 CLR 514 at 553: We should, however, state in the plainest of terms that we regard it as undesirable that limitation questions of the kind under consideration should be decided in interlocutory proceedings in advance of the hearing of the action, except in the clearest of cases. Generally speaking, in such proceedings, insufficient is known of the damage sustained by the plaintiff and of the circumstances in which it was sustained to justify a confident answer to the question.

Transfer or Dismissal

1. The appellant submitted that, in the event that we find that the Tribunal has no jurisdiction, we should transfer the proceedings to a Court of competent jurisdiction. The respondents opposed that course but, in our view, offered no good reason for their opposition. If we simply dismiss the appeals, effectively affirming the orders made below, the appellant will be required, should he wish to continue with his claims, to commence proceedings in a Court. That would potentially expose him to an assertion that he has brought proceedings out of the time prescribed by the Limitations Act. In our view, justice and fairness requires that the appropriate order should be one by which the proceedings are transferred to a Court and the appellant can thereafter determine whether he wishes to continue to prosecute his claims. In view of the amount claimed, the appropriate Court is the Local Court.
2. Our attention was drawn to the decision of Parker J in The NTF Group Pty Ltd v PA Putney Finance Australia Pty Ltd [2017] NSWSC 1194 in which his Honour declined to leave proceedings in the Local Court and transferred them to the Supreme Court. In that case, there was an assertion that certain agreements be declared void by reason of s 21 of the Australian Consumer Law. His Honour held that there was "real doubt" as to whether the Local Court has jurisdiction to entertain the applicant's cross claim (paragraph 34) seeking orders that the agreements be declared void. But the Court did not doubt that the Local Court had power to deal with a cross claim for damages (see paragraphs 28, 31 and 36). In our view, the appellant is seeking damages in these proceedings and the Local Court appears to be the appropriate Court.

Orders in both Appeals

1. The Appeal Panel makes the following orders: 1. Except for the purposes of the orders below, the appeals are dismissed; 2. The appellant's application filed in the Tribunal (GEN 17/39611) against Chan & Naylor Parramatta Pty Ltd as Trustee for Chan and Naylor Parramatta Trust, Henry Brisbane and Kenneth Raiss is transferred to the Local Court of New South Wales to be dealt with there in accordance with the rules and directions of that Court; and 3. The appellant is to pay the costs of the respondents in both appeals in an amount agreed or as assessed.

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: 20 December 2018