Wiskich v Composite Materials Australia Pty Ltd

Facts

1. By agreement in writing dated 8 October 2011 the appellant, as owner of a house contracted with Buildsmart Home Improvements Pty Ltd (Buildsmart) for the erection of a pre-fabricated and metal-framed home additions and structures. In particular, the work was described as follows: "Flat Awning with a dutch gable to the centre with insulated ceiling. Decking and Railing to be supplied and installed as shown on the previous page At the front of the existing dwelling in place of the existing awning and veranda".
2. Pursuant to the contract, the decking was to be comprised of "low maintenance imitation decking". The supplier of the decking was Composite Materials Australia Pty Ltd (Composite Materials). The particular style of decking was described as "Gossen 'Passport' brand decking in Tuscan Cherry".
3. By 30 January 2012 the work had been completed but within three or four weeks thereafter the surface of the decking appeared to be scratching easily and hazing had appeared in patches. Buildsmart inspected the decking and agreed that there was a problem with the quality of the decking. Despite attempts to have the problem rectified, no satisfactory resolution was achieved and accordingly the appellant instituted proceedings in the Tribunal (the preliminary proceedings).
4. These preliminary proceedings came before the Tribunal for hearing on 26 February 2015. In its reasons dated 3 March 2015 the Tribunal found that the decking supplied by the respondent failed to comply with the statutory warranty provided by s54(3) of the Australian Consumer Law. The decking was found not to be fit for its purpose because it was not free from defects nor was it safe and durable. Having made such finding the Tribunal Member said as follows: "The decking cost of about $15,000 including the laying and other building work raised a reasonable expectation that it would be colour stable and not prone to scratching".
5. In the decision the Tribunal Member stated that the cost of the decking was "about $15,000, Ex A". The Tribunal Member made a work order requiring the decking to be rectified on or before 6 April 2015.
6. The Tribunal also ordered that the appellant have leave to renew the application at any time up to and including 30 June if there was failure by Composite Materials to comply with the work order contained in Order 1.

Renewed application

1. The respondent failed to comply with the work order and accordingly on 27 May 2015 the appellant renewed her application to the Tribunal by the proceedings. The application was heard and determined on 25 November 2015. The Tribunal Member, having observed that the work order had not been fulfilled considered that it was appropriate that a money order be made in lieu of the work order.
2. The appellant provided estimates for the cost of the rectification of the works which totalled approximately $40,000, which is fully detailed hereunder. Such cost included a quotation for labour provided by Buildsmart of $12,480 and costs of materials of approximately $28,000. However the Tribunal Member dismissed such evidence making the following observations: "The finding of fact by the Tribunal on File 14/41988 is that the original contract price is $15,000.00 Evidence of the applicant is that this finding was an error and the respondent disputes this and states it was pursuant specific evidence given at the hearing. I am not prepared to go behind those findings of the Tribunal which are clearly set out in the reasons provided by the presiding Member and consider that an order in this amount would constitute a refund of the whole of the cost of the decking and would place the applicant in a position that she would have been in if the decking work was not carried out. This amount would compensate the applicant for any removal of the defective boards and the cost of replacement. Orders are made accordingly".
3. The appeal was heard on 26 April 2016. The respondent did not attend the hearing.

Respondent's application for leave to reopen

1. On 22 June 2016 the respondent was advised by email that the reasons for decision would be delivered on 23 June 2016. By email dated 22nd of June 2016 the respondent notified the Tribunal of his concern that the appeal took place without his attendance. Mr Eamon Hurley, the principal of the respondent, stated that he was not aware of the hearing having taken place, and had not been notified of the hearing date. For convenience, the respondent and Mr Hurley will be referred to as "the respondent". In his email he also stated: "My previous correspondence with the tribunal also raised this concern as a preliminary hearing occurred without my being contacted to attend by phone. My records show me advising the tribunal in writing of my unavailability, on a listed date, to which I never heard back to. I am extremely concerned about an appeal decision being made without my inclusion and that its intended for publication by tomorrow morning. Due to the timely manner of this issue I wish to ask it be attended to as soon as possible. Thank you."
2. As a consequence of the respondent's message, delivery of the reasons was postponed and a hearing date of 18 August 2016 was fixed for the purpose of hearing the respondent's application for leave to reopen the hearing and also, if considered appropriate, to hear the respondent's arguments and receive the respondent's evidence if any. The respondent objected to attending in Sydney as he was living in Western Australia. Initially the Tribunal declined an application to attend by telephone because of the complex issues which would arise. However upon considering further submissions concerning the respondent's impecuniosity, the Tribunal agreed that the respondent could attend the hearing of the respondent's application by telephone.
3. The respondent's application was opposed. The hearing took place on the allocated date and extended over more than three hours of hearing time during which Mr Hurley advanced his argument .He also referred to written material which he had provided to the Tribunal on 4 August 2016. Mr Hurley reiterated his claim that he had no notice of the hearing on 26 April 2016. He also indicated that he wished to rely on what he called "new evidence". We shall deal with these aspects of his application in turn. For convenience we will refer to the facts as appear from both the tribunal file and the statements made during the hearing on 18 August 2016.
4. If the respondent had not been notified of the hearing date of 26 April 2016, procedural fairness would not have been provided to it. For this reason it is essential to consider the events which preceded the hearing date.
5. The Notice of Appeal in these proceedings was filed on 23 December 2015. By letter dated 5th of January 2016 the Tribunal notified the respondent, by letter addressed to a mailing address in Valley Road, Wembley Downs, W.A. of the filing of the appeal and enclosed a copy of the Notice of Appeal. The notice contained voluminous detail and effectively set out the appellant's case.
6. The Tribunal's letter dated 5 January 2016 informed the respondent that it was required to file a Reply within 14 days of receipt of the letter as follows: "You are required to lodge with the Tribunal a Reply to Appeal within 14 days of receipt of this correspondence. A copy of the above reply must also be given to the Appellant. A Reply form is enclosed for your assistance." Further the respondent was advised that the callover would take place on Tuesday, 16 February 2016 at 9:30 AM at the Tribunal. The respondent was also informed that if he wished to participate by telephone he would need to make contact with the registry and an address was provided where such arrangement could be made by email.
7. Notification of the Directions Hearing was also sent by mail to 2 additional addresses of the respondent namely a PO Box in Scarborough W.A. and an address in Cambridge Street, West Leederville WA.
8. Such notification was obviously received by the respondent because by email dated 14th of January 2016 Mr Hurley responded: "Please be advised that I am not available on the date 16/2/16 listed for hearing. Can a new date please be appointed? I am free the remainder of February. I'm not available in March. Thank you."
9. By letter dated 14th of January 2016 the Tribunal responded advising the respondent that any adjournment request must be provided to the appellant seeking her comment and once this had been done, an application could be made to the Appeal Panel to consider the request. The respondent was specifically notified that the matter was listed for callover only and not for the hearing of the appeal, the date of which would be decided at the callover. Again the respondent was informed that he could attend either by himself or by any person. It appears that the respondent sent a request to the appellant for an adjournment but it was not acceded to. Accordingly the directions hearing took place on the 16th of February 2016. The directions which were made are significant for the current application.
10. Since the respondent had failed to provide his Reply as directed in the tribunal's letter of 5 January 2016, the Tribunal directed: "2. The Respondent is to lodge with the Tribunal and provide to the appellant a copy of the Reply to Appeal by 1/3/2016 that is whether and details of current status of company trading or not." (sic)
11. By direction 3 the appellant was directed to lodge its submissions and provide them to the respondent by the 15/3/2016 and any evidence upon which the appellant relied. By direction 4 the respondent was directed to: "lodge with the Tribunal and provide to the appellant by 29/3/2016: (a) All the evidence provided to the Tribunal below on which it is intended to rely; (b) The Respondent written submissions in opposition to the appeal."
12. Direction 6 provided: "The Appeal is listed for HEARING [emphasis in original] on 26/4/2016 at 10:15 AM for half day."
13. A notation appeared at the foot of the directions as follows: "Respondent says on 2/12/2015 ceased trading has no assets."
14. The Tribunal's file shows that the directions were forwarded by mail to the respondent at its West Leederville address and that a Notice of Hearing which confirmed the information contained in the directions was forwarded to the Scarborough address. All such correspondence was forwarded on 17 February 2016. The Tribunal's file does not record that any letter was returned unclaimed.
15. It is obvious that the respondent received the Tribunal's letter of 17 February 2016 noting that the directions, in view of the email which Mr Hurley sent to the Tribunal dated 19 February 2016. This email states: "To All Concerned As advised last year, Composite Materials Australia Pty Ltd ceased trading. It has a zero net asset value. I had advised all parties of my unavailability for the hearing 16/4/2016 however it appears to have proceeded anyway. I am not able to attend to any further hearings due to my location in Western Australia and as composite Materials Australia Pty Ltd is no longer trading. Regards Eamon Hurley"
16. Since the respondent knew of the directions notified by letter dated 17th of February 2016, it is obvious that the respondent was also aware of the requirements to provide a Reply, and to provide submissions. It is also obvious that the respondent must have known the hearing date for the appeal because the directions provided specific notification of this date.
17. The Tribunal infers from this factual history and from the respondent's non-compliance with the directions and its non-appearance at the hearing, that the respondent elected to ignore the directions of the Tribunal and to ignore the hearing date.
18. On 18 August 2016 the respondent complained that he had not received any communication from the Tribunal or from the appellant since 22nd of February 2016. He relied upon a statutory declaration of Danika McVea which supported such contention. However such submission and the facts alleged, do not absolve the respondent. The respondent knew of the directions requiring a Reply to be filed and knew of the requirement to provide submissions. The respondent also knew of the date fixed for hearing.
19. Against these facts, it is unnecessary for the Appeal Panel to attempt to resolve the claim that the respondent did not receive the appellants' submissions, when the evidence before this Appeal Panel shows that they were mailed to him in the time prescribed by the directions. The respondent did not need the appellant's submissions in order to file his reply as the detailed contents of the Notice of Appeal clearly stated the basis of the appellant's appeal.
20. Also at the hearing on 18 August the respondent submitted that no one from the Tribunal contacted him concerning the hearing date. He says that his email dated 19th February 2016 did not mean that he would not attend any further hearings: but rather that he would like to be heard by telephone.
21. In answer to this submission two matters must be considered: firstly the respondent's email dated 19 February 2016 does not suggest that it was doing other than taking no part whatsoever in the proceedings: it does not suggest that Mr Hurley would like to be heard by telephone. Secondly Mr Hurley acknowledges that at no time did he make contact with the Tribunal to seek approval for his testimony to be taken by telephone.
22. The Tribunal has drawn the conclusion from the factual history that the respondent chose to ignore all directions made by the Tribunal and chose to ignore the hearing date. In view of these findings the question arises as to whether there has been any denial of natural justice because the respondent did not appear at the hearing.
23. It is unquestioned that no person, at least in common law, is to be condemned unless that person has been given prior notice the allegations against him and a fair opportunity to be heard: this is a fundamental principle of justice. The right to a fair trial is an aspect of procedural fairness, namely the duty to act fairly which requires courts and tribunals and other bodies or persons who carry out quasi-judicial functions to so act. As is stated by Halsbury's Laws of England, 5th edit Vol 77 p27 at[5} : "The duty to act fairly also invokes the requirements of natural justice that are derived from common law whose own rules must be observed by courts from the tribunals, arbitrators and all persons and bodies having the duty to act judicially, except where their application is excluded expressly or by necessary implication, or by reason of other special circumstances".
24. In Lloyd v McMahon [1987] AC 625 at 703, the following principle is stated: "When a statute has conferred on anybody the power to make decisions affecting individuals, the courts will not only require the procedure prescribed by the statute to be followed, but will readily imply so much and no more to be introduced by way of additional procedural safeguards as will ensure the attainment of fairness."
25. The Tribunal provided notification to the respondent of the hearing date and of the directions to be satisfied by the respondent prior to the hearing. That is, the Tribunal in following its practices and procedures designed to achieve the guiding principle contained in section 36 (1) of the New South Wales Civil and Administrative Tribunal Act 2013 No 2, and has fulfilled all of the obligations required of it on its part to give the parties procedural fairness. In this respect the Tribunal has fulfilled its obligations.
26. The complaints raised by the respondent of lack of notification of the hearing and of being denied the opportunity of being heard, when considered against the above facts, cannot be sustained. Accordingly the Appeal Panel rejects the claims of the respondent that it has been treated unfairly because it was not aware that the hearing was taking place in its absence. The Appeal Panel is satisfied that the respondent, contrary to its submissions, was aware from 19 February 2016 of the hearing date of 26 April 2016 and of the need for it to file its Reply and its submissions.
27. The second part of the respondent's application was in effect for leave to re-open on its case on appeal. The respondent referred to evidence which it sought to adduce and submissions which it sought to make about underlying factual matters. Some of this was referred to as "new evidence".
28. Relevant considerations obtaining on an application to re-open a party's case after a judgment stands reserved were considered by Brereton J in Chao v Chao (No 2) [2008] NSWSC 612 in which His Honour said at [2]: "For present purposes, the principles governing such an application are to be found in the judgment of Goldberg J in Hawthorn Glen Pty Ltd v Aconex Pty Ltd (No 1) [2007] FCA 2010. They may be summarised as follows. The Court has a discretion to grant a party leave to re-open its case after final submissions have been concluded and the Court has reserved its decision. The ultimate question is whether the interests of justice are better served by allowing or rejecting the application. It is relevant to consider whether prejudice would be occasioned by the late introduction of the evidence to the other party. It will also be relevant to consider the materiality of the proposed additional evidence, and whether it could by reasonable diligence have been discovered before, or at least any explanation for its not having been adduced earlier. If there was a deliberate decision made not to call the evidence when it ought to have been called in the ordinary course of proceedings, that will typically tell decisively against allowing a reopening, although there is no hard and fast rule requiring the Court to reject an application even where the decision not to call a witness or tender a document was a deliberate one."
29. The issue had previously been considered by Austin J in ASIC v Rich [2006] NSWSC 826 in which His Honour said at [18]: "The defendants submitted a list of matters that they claimed to be relevant to the exercise of the court's discretion to permit the plaintiff in a civil penalty proceeding to adduce further evidence after it has closed its case. I accept their list as a useful statement of relevant discretionary factors, applicable in such a case as the one before me. The list is as follows: (a) the nature of the proceeding; (b) whether the occasion for calling the further evidence ought reasonably to have been foreseen; (c) the consideration of fairness that the defendant is entitled to know all of the evidence he has to meet in taking forensic decisions as to cross-examination and the nature and extent of the evidence he will himself adduce on the matters in question; (d) the extent to which the plaintiff has embarked upon calling evidence on the issue in question in its case in chief; (e) the importance of the issue on which the further evidence is sought to be adduced to the pleaded issues in the case; (f) the degree of relevance and probative value of the further evidence sought to be adduced and its potential to involve an undue waste of time; (g) the prejudice to the defendant in terms of delay in the completion of the proceeding and the consequential costs; (h) the public interest in the timely conclusion of litigation; (i) what explanation is offered by the plaintiff for not having called the evidence in chief."
30. These factors were applied by Harrison J in N M Rural Enterprises Pty Ltd v Rimanui Farms Ltd [2012] NSWSC 31 at [15]ff and Stevenson J in The Owners - Strata Plan No 74602 v Brookfield Australia Investments Ltd [2015] NSWSC 1682 at [42]. Stevenson J said in Brookfield at [43] although the factors provide a useful guidance the relevant discretion must ultimately be exercised having regard to all the circumstances of the case (referring to Taouk v Louis (No. 1) [2014] NSWSC 656 per Darke J at [11]).
31. In its proposed written submissions dated 3 August 2016, the respondent asserted that access was denied to the subject property to perform rectification works. This material had been considered by the Tribunal and is referred to in the Reasons. It is not new evidence.
32. There was also before the Tribunal at first instance a quotation dated 21 March 2015 from Buildsmart Home Improvements Pty Ltd for the cost of labour for rectification in the sum of $12,480. The Tribunal considered, on the question of any lack of independence, (Buildsmart Smart having been a party to the proceedings) that the appellant had also obtained other quotes which were more than this amount. The respondent put into evidence a quote for the labour costs to replace the Tuscan cherry boards with London grey at a cost of $4,400. This is referred to in the Reasons. That quotation to which the respondent sought to refer is not new evidence.
33. The respondent also seeks to introduce evidence that it prepared for materials in May 2015 in the amount of $25,653.93 has in some way been misconstrued, was a product list and was an error. It is apparent from the Reasons at first instance that this matter was previously raised by the respondent and considered. Apart from the submission which he made on his application before us there was no new evidence substantiating that what he said was an error for the Appeal Panel to consider.
34. Before the Appeal Panel the respondent sought to introduce an audio file of the proceedings in file 14/41988 on 26 February 2015 in particular at 2:16:40 where the Presiding Member is said to have confirmed with the installer that the total job cost was $15,000. Before the Tribunal below it had been asserted by the appellant that the finding was in error. This was disputed by the respondent who said the finding was pursuant to specific evidence given at the hearing. The audio, or at least its contents, was apparently the subject of a submission by the respondent before the Tribunal on 25 November 2015. This appears on the face of the Reasons. The audio recording is not new evidence.
35. The respondent also sought to introduce "new evidence" in the nature of photographs of the deck area and a video showing no deck issues. As far as the Appeal Panel can ascertain the material had previously been before the Tribunal at the hearing on 26 February 2015.
36. Having regard to the finding outlined in Rich to which we have referred, the following is of particular relevance in our view to the exercise of the discretion to grant leave to re-open: 1. The fact that the respondent was on notice of the hearing date of the appeal, served no reply nor submissions and did not appear; 2. The material which we have identified which the respondent seeks to introduce on the appeal was available to be introduced when the appeal was heard; 3. To the extent that such material includes evidence of factual matters, as far as we can ascertain from the reasons, the material was advanced on behalf of the respondent in the proceedings at first instance and is not new evidence; 4. The appellant would suffer further prejudice in terms of delay in the completion of the proceedings and consequential costs were leave to be granted to the respondent. The appeal was heard on 26 April 2016 and the Reasons were to be delivered on 23 June 2016. Disposal of the matter has been delayed for several months to allow the respondent's application to be heard and the appellant has suffered the further burden of preparation submissions and preparing and appearing for the hearing. The respondent informed the Tribunal that the respondent is not trading and has no "net asset value". We infer from this that the respondent may not be in a position to meet any costs order consequent upon the application for leave being granted and the appeal proceeding to a rehearing. 5. There is also the public interest in the timely conclusion of the litigation. Disposal of the matter should not be further delayed particularly when the respondent was aware of but elected not to file a Reply or submissions or appear at the hearing of the appeal.
37. It appears to us in all the circumstances and upon consideration of the relevant factors to be taken into account in the exercise of the discretion that that is not in the interests of justice to allow for the respondent's application for leave to re-open.
38. The question arises whether notwithstanding its findings on the respondent's application, the Appeal Panel, in the exercise of its discretion, should otherwise grant the respondent leave to reopen the hearing. On this question the High Court of Australia in Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175 has made it plain that parties are to be bound by the conduct in which they engage in the prosecution or defence of litigation. In particular the majority concluded at [105) to [110] that the objects stated in the relevant court rules concerning the timely and cost effective resolution of the dispute are paramount and that consideration has to be given to the effect of any amendment sought to the court and to the other litigants.
39. This decision appears to be particularly applicable to the present circumstances. The Appeal Panel is satisfied that the respondent chose to ignore the directions of the Tribunal commencing with its direction made on 5 January 2016 requiring the respondent to file and serve its reply; and the directions made on 16 February 2016 which included notification of the hearing date, and the requirement to file submissions. As a consequence the preparation for the Appeal, and a hearing based on the material placed before the Tribunal, took place on the allocated date. The respondent was given the opportunity to participate. As a result it would be contrary to the interests of the appellant, as well as the Tribunal and the public, for the respondent to now be allowed to raise matters which could have been raised at the hearing, by providing a second hearing.
40. Despite the above, even if the Appeal Panel had proceeded to consider the material and submissions advanced by the respondent on 18 August 2016, on the substantive appeal, the result would have been no different. We shall refer to the relevant material and submissions in our substantive reasons below.

The appeal

1. In the appeal the appellant essentially contends that an error of law has occurred arising out of two circumstances. Firstly, the appellant maintains that the amount of $15,000 was not the contract price as stipulated in the contract; rather, such amount merely reflected a progress payment. Accordingly the adoption by the second Tribunal Member of the finding of the first Tribunal Member constituted an obvious error. Secondly it is submitted that the Tribunal Member at the second hearing rejected, without considering, the quotations provided and failed to consider the evidence thereby giving rise to an error of law.
2. It is convenient to note that the contract made between the appellant and Buildsmart contains a Payment Schedule which states as follows: Deposit + Plans & other insignificants $2,500 5% Payment on obtaining approval to build $5,000 10% Payment 7 days prior to delivery of goods $10,000 20% Payment on Completion of Awning $15,000 30% Payment on Completion of Decking $15,000 30% Payment on Completion of works $2,500 5% Total payable $50,000 100%

1. The appellant submits that the Appeal Panel should set aside the order for $15,000 monetary compensation and instead order that the rectification amount is $38,133.93 plus GST.
2. The appellant also submits that the Tribunal's decision was not fair and reasonable and is against the weight of evidence. The appellant had provided quotations which supported the amount of compensation that she seeks. The cost of labour for rectification, provided by Buildsmart, amounted to $12,480. Further the cost of materials for such rectification, as shown in the respondent's quotation dated 1 May 2015 amounted to $25,653.93.
3. The appellant submits that the Tribunal should have given weight to the quotations which she provided, and not assumed a contract price as the Tribunal in fact did.
4. It should be observed that when commenced these proceedings constituted a "consumer claim" as defined in s3A of the Consumer Claims Act, 1998 (NSW). The Consumer Claims Act was repealed on 1 October 2015 before the disposal of proceedings on 25 November 2015.
5. Clause 29 of Schedule 5 of the Fair Trading Act 1987 (NSW) provides: (1) Part 6A of this Act extends to a consumer claim arising before the commencement of that Part (except as provided by subclause (2)). (2) The former Act continues to apply in relation to a consumer claim the subject of an application made under section 6 of the former Act that is not finally determined. (3) For the purposes of this clause, an application is not finally determined if: (a) any period for bringing an appeal as of right against a decision in respect of the claim the subject of the application has not expired (ignoring any period that may be available by way of extension of time to appeal), or (b) any appeal against the decision is pending (whether or not it is an appeal brought as of right).
6. The 'former Act' is defined as the Consumer Claims Act under clause 28. In these circumstances, clause 29(2) of Schedule 5 of the Fair Trade Act applies so that the claims are to be dealt with under the Consumer Claims Act and not Part 6A of the Fair Trading Act. See also Lam v Steve Jarvin Motors Pty Ltd [2016] NSWCATAP 186 at para [8]-[9].
7. Section 80(1) of the Civil and Administrative Tribunal Act 2013 (NSW) (CAT Act) provides that an appeal against an internally appealable decision may be made to an Appeal Panel. This is defined in s 32 to include a general decision made by the Tribunal being a decision made in the exercise of the Tribunal's general jurisdiction ascertained by reference to legislation other than the CAT Act.
8. Jurisdiction having been enlivened by s7 of the Consumer Claims Act the Tribunal had general jurisdiction in relation to the consumer claim and the appeal panel has jurisdiction in relation to the internally appealable decision.
9. No issue of leave to appeal arises on that aspect of the appeal on a question of law which was lodged within time. For that aspect of the appeal on other grounds, leave is required; s80(2)(b) CAT Act. Pursuant to clause 12(1) of Schedule 4 of the CAT Act the Appeal Panel's discretion to grant leave to appeal from a decision of the Consumer and Commercial Division exercising functions, including at the relevant time under the Consumer Claims Act, is only enlivened if the Panel is satisfied that the appellant may have suffered a substantial miscarriage of justice because: 1. the decision of the Tribunal under appeal was not fair and equitable, or 2. the decision of the Tribunal under appeal was against the weight of evidence, or 3. significant new evidence has arisen (being evidence that was not reasonably available at the tie the proceedings under appeal were being dealt with)
10. In Collins v Urban [2014] NSWCATAP 17, the Appellate Division of the NSW Civil and Administrative Tribunal considered the ingredients necessary to satisfy a "substantial miscarriage of justice" (see paras 70]-[79] of the decision).
11. If the Appeal Panel considers that there has been inter alia, error of law in the making of the decision, the Appeal Panel may exercise its discretion in favour of quashing or setting aside the decision and for another decision to be substituted; s 81(d) of the CAT Act.

Findings

1. In the Tribunal's determination, the Tribunal Member stated that the sum of $15,000 had been found in the hearing on 27 February 2015, as representing the cost of rectification. However, the Tribunal Member had before him evidence of both the cost of materials and of the labour costs to undertake the rectification. The Tribunal Member rejected such evidence. The Tribunal Member stated that there had already been a finding that the sum of $15,000 was the contract price for the construction of the deck, and that the Tribunal was not prepared to go behind the finding which had been made on 3 March 2015.
2. When the decision in proceedings 14/41988 of 3 March 2015 is examined, the decision states the following: "On 26/9/11 the applicant and Buildsmart made a written agreement to supply and fix a Gossen 'Pastport' brand decking in Tuscan Cherry at the applicant's home, for about $15,000, Ex A;"
3. In fact, when the documents comprising Ex A before the original decision maker are examined, there was no evidence that the cost of the decking was $15,000. Rather, the amount of $15,000 was a progress payment to be made "on completion of decking, together with other progress payments". There is nothing in the contractual documents, nor indeed in any other record, contained in Ex A which suggests or indicates that the cost of the decking alone was $15,000.
4. Accordingly, the Appeal Panel is satisfied that the original Tribunal Member erred in determining that $15,000 represented the cost of the decking. Such error was compounded by the Tribunal's second determination made on 25 November 2015 wherein that figure was adopted. Irrespective, at the second hearing of the Tribunal, the Member did not have any regard to the evidence before him as to the current cost of rectification.
5. An error of law can occur where a primary decision maker fails to take into account some material consideration. In House v The Queen (1936) 55 CLR 499 at 504-5 Starke J said: "The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judge composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so".
6. In Minister for Aboriginal Affairs v Peko-Wallsend Limited (1986) 1985-1986 vol 162 CLR 24 at 39 Mason J said: "(a) The ground of failure to take into account a relevant consideration can only be made out if a decision-maker fails to take into account a consideration which he is bound to take into account in making that decision: Sean Investments Pty Ltd v MacKellar (29) CREEDNZ Inc v Governor-General (30); Ashby v Minister of Immigration (31). The statement of Lord Greene MR in Associated Provincial Picture Houses Ltd v Wednesbury Corporation (32), that a decision-maker must take into account those matters which he 'ought to have regard to' should not be understood in any different sense in view of his Lordship's statement on the following page that a person entrusted with a discretion 'must call his own attention to the matters which he is bound to consider'". [References omitted]
7. At p47, Mason J having questioned the circumstances where an appellate court should interfere said: "The question must be answered by reference to the principles of law which regulate the circumstances in which an appellate court may review the exercise of a judicial discretion. These principles are not in doubt. They were authoritatively enunciated in House v The King [69], in terms which have been frequently applied by the Court, most recently in Norbis v Norbis (70)". [References omitted]
8. It is well established that the exercise of discretion by an appellate tribunal to set aside a primary determination may arise where an error of law has occurred. An error of law can be constituted by a failure by the decision-maker to take into account some material consideration. In this instance, the fact that the Tribunal Member did not deal with the evidence placed before him by the appellant constitutes such a failure.
9. But the Appeal Panel considers that there is yet a further ground. A decision-maker can be regarded as "irrational" or "unreasonable" if it can be demonstrated that the conduct of a Tribunal Member was so unreasonable that no reasonable person could reach such a conclusion: that is, a high level of unreasonableness might be equated to irrationality: see Minister for Immigration and Citizenship v SZMDS (2010) 240 CLR 611: see also Associated Provincial Picture Houses v Wednesbury Corporation [1948] 1 KB 223.
10. The original decision of the Tribunal made findings directed towards the making of a work order: it was not directed to the issue of the actual cost of rectification of the defective decking. Only when the work order was unfulfilled was it necessary for the Tribunal to consider what monetary compensation should be paid to the appellant for the breach of statutory warranty. It was at this point that the Tribunal ought to have had regard to evidence placed before the Tribunal and which related to this very issue.
11. For these reasons the Appeal Panel is satisfied that the decision below warrants intervention by the exercise of the Appeal Panel's discretion, on the basis that an error of law has occurred because of the Tribunal's failure to consider the evidence of rectification. Such finding also leads to the conclusion that the decision is unreasonable.
12. We are also of the view, in circumstances including the existence of the grounds of appeal on a question of law which we have identified, leave to appeal on other grounds should be granted.
13. We are satisfied that a substantial miscarriage of justice may have been suffered by the appellant by reason that the adoption by the Tribunal of $15,000 as the contractual price and its failure to consider the evidence of actual costs were each not fair and equitable and against the weight of the evidence. A more favourable result would have been achieved had the relevant circumstances not occurred: see Collins at [76].
14. Having been satisfied of these matters, we must consider the general principles to be applied when deciding whether to grant leave to extend the appeal to the merits of the decision. These principles were summarised in Collins at 84 as follows: 84 The general principles derived from these cases can be summarised as follows: 1. In order to be granted leave to appeal, the applicant must demonstrate something more than that the primary decision maker was arguably wrong in the conclusion arrived at or that there was a bona fide challenge to an issue of fact: BHP Billiton Ltd v Dunning [2013] NSWCA 421 at [19] and the authorities cited there, Nakad v Commissioner of Police, NSW Police Force [2014] NSWCATAP 10 at [45]; 2. Ordinarily it is appropriate to grant leave to appeal only in matters that involve: 1. issues of principle; 2. questions of public importance or matters of administration or policy which might have general application; or 3. an injustice which is reasonably clear, in the sense of going beyond merely what is arguable, or an error that is plain and readily apparent which is central to the Tribunal's decision and not merely peripheral, so that it would be unjust to allow the finding to stand; 4. a factual error that was unreasonably arrived at and clearly mistaken; or 5. the Tribunal having gone about the fact finding process in such an unorthodox manner or in such a way that it was likely to produce an unfair result so that it would be in the interests of justice for it to be reviewed, 6. BHP Billiton Ltd v Dunning [2013] NSWCA 421 at [20] and the authorities cited there, SAB v SEM [2013] NSWSC 253 at [8] and [9] and the authorities cited there, Nakad v Commissioner of Police, NSW Police Force [2014] NSWCATAP 10 at [45]; 1. In relation to an application for leave to appeal relating to a question of practice and procedure, the application is to be approached with the restraint applied by an appellate court when reviewing such decisions, especially if the application is made during the course of a hearing: BHP Billiton Ltd v Dunning [2013] NSWCA 421 at [21] and the authorities cited there.
15. In our view the factual finding that the contractual price was $15,000 was an error unreasonably arrived at in light of the evidence to the contrary and clearly mistaken. Additionally, by failing to take into account relevant evidence as to cost which was available, the Tribunal has gone about the fact finding process in such an unorthodox manner or in such a way that it was likely to produce an unfair result and it is in the interests of justice for that decision to be reviewed.
16. For these reasons we are of the view that leave to appeal on the merits should be granted.

Relief

1. The question now arises as to the course which the Appeal Panel is empowered to take. Pursuant to s36(4) of the Civil and Administrative Tribunal Act 2013 (No 2) (NSW), the Tribunal is to resolve proceedings in such a way that the cost to the parties and the Tribunal is proportionate to the importance and complexity of the subject matter in the proceedings. If the Appeal Panel quashed the decision which is appealed from it would result in a further hearing at the appellant's expense.
2. The Appeal Panel is satisfied that because the evidence concerning the cost of rectification is before it, it should proceed to make a monetary compensation order in the amount which is claimed. In doing so, we have had regard to the submissions which the respondent identified it wished to make and evidence it wished to tender had leave been granted to it to reopen its case on the appeal.
3. On the question of the contract price the respondent seeks to make reference to an audio tape of the proceedings in which the finding of the contract price was first made. Such evidence is not probative of the contract price merely as to the finding which we have determined was in error. Nor, as the appellant submitted, would evidence of the contract price be determinative of later rectification costs. That evidence would not have assisted the respondent
4. The appellant had put into evidence a document in the form of a quotation for materials prepared by the respondent dated May 2015 in an amount of $25,653.93. The respondent had submitted before the Tribunal that the quotation was the subject of a covering letter asserting that the dimensions provided by the appellant and the subject of the quote were in error. The respondent sought to make the point again if given leave to reopen its case asserting that the document was not a quotation for materials. The Member had noted that the subject correspondence was not before the Tribunal. Nor was it sought to be put before the Appeal Panel. Nor was Mr Hurley able to point to any other evidence going to an alternative characterisation of this document. We note that the document identifies in its terms "COD" which the Tribunal takes me mean "Cash on Delivery". This would have militated against a finding by the Tribunal that the document was not a quotation for materials.
5. There was also before the Tribunal, at first instance, a report from Kavan Constructions tendered by the respondent which stated the quantity of replacement decking required would be 450 lineal metres. The Reasons noted that the respondent had put on no evidence to relate this quantity to a monetary amount. Nor did the respondent seek to introduce such evidence on the appeal.
6. The appellant's evidence comprises the quotation of Buildsmart dated 21 March 2015 which establishes the cost of labour to rectify the decking in the sum of $12,480.
7. The cost of materials is contained in a quotation provided by The Woodage dated 19 August 2015. Such quotation states that the cost of materials is $24,624 plus GST, together with the provision of steel face fix screws at a cost of $1,417 plus GST and delivery of $240 plus GST. Accordingly, the total the cost of materials is $28,909.
8. Had the respondent been granted leave to reopen its case we would not have been satisfied on the available material as to its contentions regarding the materials cost. It is in the range of the document which the respondent itself prepared in May 2015. There was no evidence to relate the respondent's calculation as to the quantity of materials identified in the Kavan report to a monetary amount. Nor would the respondent's evidence of labour costs contained in the quotation of Platinum Pool Surrounds dated 16 September 2015 be preferred over the earlier quotation from Buildsmart. The quote of $4,400 was one option of three and there is excluded from the quote any structural work for which the labour costs were unknown.
9. We accept the appellant's evidence that the total for labour and materials, including $2,628 GST, is $41,389. Since the limit of jurisdiction is $40,000, the Appeal Panel will substitute, by variation to the existing order, an order that the appellant be paid the sum of $40,000 by the respondent, and that such payment be made within 28 days.

Orders

1. The Appeal Panel orders: 1. That the respondent's application for leave to reopen its case on appeal is refused. 2. That the Appeal from the orders made on 25 November 2015 in proceedings 15/35105 be upheld. 3. That the amount of $15,000 as set out in the money order made in proceedings 15/35105 be varied by the substitution of the amount of $40,000 in lieu of $15,000. 4. That the amount of $40,000 is to be paid by the respondent to the appellant within 28 days of the date of this order. 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: 06 October 2016