Zammit v Asia Partnership Consulting Pty Ltd t/as River Farm Enterprises

NCAT Appeal Panel|2021-11-22

Summary

The appellants appeal from a decision of the Consumer and Commercial Division of the Tribunal (Tribunal) of 16 April 2021 in matter GEN 20/47422 (the Decision).
The appellants were the applicants before the Tribunal. They had sought an order that the respondent pay them $10,036.26, being a refund of moneys paid pursuant to an agreement for their wedding to be held at the respondent's venue.
The Tribunal dismissed their application.
The appeal was filed considerably out of time.
For the following reasons, we have decided not to extend the time for filing the notice of appeal, and to otherwise dismiss the appeal

Background

The background to the appeal appears sufficiently in the following paragraphs of the Decision which we set out below: 1 [The appellants] seek an order from the Tribunal that would require Asia Partnership Consulting Pty Ltd (the respondent) to pay them the sum of $10,036.26, being a refund of money paid pursuant to an agreement for a wedding at the respondent's venue scheduled to be held on 14 November 2020 (the contract). 2 The [appellants] claim a full refund of money paid under the contract as they cancelled their wedding due to COVID-19 and claim that the contract was frustrated. Alternatively, the applicants claim that the respondent relies on a unfair contract term pursuant to s 24 of the Australian Consumer Law (ACL) and therefore the [appellants] are entitled to a full refund of money paid under the contract in the amount of $10,036.36. … 7 The [appellants] entered into an agreement with the respondent on 9 July 2019 for their wedding to be held at the respondent's venue on 14 November 2020. The agreement included 3 nights' accommodation at The Silo and The Main Historic House from 12 November to 15 November 2020 and the venue was to accommodate 130 guests. The agreement also provided for a corkage charge of $5 per person. The total cost of the agreement was $20,072.50. 8 The [appellant]s' evidence was they chose to hold their wedding at the respondent's venue as it was capable of holding between 120 and 130 guests. Further, they were able to make their wedding into an event that was to be held over a number of days, with a dinner on the Friday night, wedding on the Saturday and then an after party on the Sunday. The [appellants] relied on information contained on the respondent's website, together with information that had been sent to them by the respondent … 9 The [appellants] made two instalments payments under the agreement of $5,108.13, being $10,036.26 in total. 10 The [appellant]s' evidence was that COVID-19 hit and things changed. The applicants had a number of guests in Melbourne and from overseas who were prevented from travelling as they were in lock down imposed by government regulations as a result of COVID-19.

Preliminary issue- extension of time to file notice of appeal

The notice of appeal should have been filed within 28 days of the Decision, that is by 14 May 2021. However, it was filed on 15 October 2021, that is approximately four months out of time. Accordingly, an extension of time is required.
The Appeal Panel is empowered to do so pursuant to s 44 of the Civil and Administrative Tribunal Act 2013 (NSW). That section provides: 41 Extensions of time (1) The Tribunal may, of its own motion or on application by any person, extend the period of time for the doing of anything under any legislation in respect of which the Tribunal has jurisdiction despite anything to the contrary under that legislation. (2) Such an application may be made even though the relevant period of time has expired.
The respondent correctly submits that the principles governing extensions of time were considered in Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22. The principles were also confirmed in Di Salvo v Leung [2014] NSWCATAP 44. In summary, the considerations that will generally be relevant to the Appeal Panel's consideration of whether to grant an extension of time in which to lodge a notice of appeal may be summarised as follows: 1. the length of the delay; 2. the reason for the delay; 3. the extent of any prejudice suffered by the respondent; and 4. the appellant's prospects of success, that is usually whether the applicant has a fairly arguable case.

The length of the delay

Clause 23(3)(b) of the Civil and Administrative Tribunal Rules 2014 (Rules) in effect provides that an appeal to the Appeal Panel is to be made within 28 days of the publication of the Decision, in other words, by that is by 14 May 2021. As noted, the appeal was filed on 15 October 2021.
In circumstances where the time for filing the appeal is 28 days, a delay of four months is a considerable period. This factor does not favour a grant of leave.

The reason for the delay

The reason for the delay was explained by each of the appellants in their respective statutory declarations each of which was dated 27 October 2021. In summary, Mrs Zammit says that:

she and Mr Zammit had a very challenging year in 2020, in that due to COVID they had to cancel their wedding, and were "flooded with continued worry and anxiety as to whether they could proceed with [their] dream wedding";
they fell pregnant and, being older parents, "were also dealing with general anxiety related to the pregnancy", exacerbated by worry about remaining COVID free and the impact of COVID on their unborn child;
she had a new job as a senior brand manager with a new product launch in December 2020;
they attempted to organise a small intimate wedding on 2 January 2021, but due to the COVID breakout in the northern beaches of Sydney her Victorian family were unable to enter NSW;
in April her obstetrician advised her to take time off work to reduce her stress levels;
her daughter was born on 22 May 2021 by caesarean section which left her with "limited capabilities and a longer post-partum recovery period";
the NSW border again was closed, preventing her Victorian family from providing support at a time when Mr Zammit was "busy at work". She says that she was not in any mental state to be able to take on anything other than attempting to care for the baby;
Mr Zammit's Business required him to complete a full office relocation and he was working very long hours.

In summary Mrs Zammit says that: Under normal circumstances we would have been able to submit our appeal on time, however with so many factors in relation to work, mental health, the health of our baby and the limited support due to lockdown was Steve and I and managing this on our own. We truly believe that we appealed as soon as we could.
Mr Zammit's statutory declaration was to similar effect, and the quotation set out at [13] above appears in identical form in his statutory declaration.
We do not doubt the truth of any of these statements, but the fact is that the hearing was held on 13 April 2021, the Decision delivered three days later on 16 April 2021, and the Zammits' baby being born on 27 May 2021 (that is after the time for filing the notice of appeal had already passed). We do not underestimate the difficulties of having a young baby, compounded by health issues and Mr Zammit having demanding responsibilities at his job. Nevertheless, the evidence is somewhat generalised and does not point with any precision as to why the appeal could not be filed within the 28 days demanded by the Rules, let alone within a further four months after that date. Further, many of the matters relied on relate to 2020 and to events before the Decision was published, not to events after the Decision was published.
For its part, while the respondent submits: 1. no adequate reason is advanced as to why the appellants were unable to comply with the deadline to file a notice of appeal; 2. when the appellants' baby was born on 22 May 2021, the deadline for filing the notice of appeal had already expired; 3. there is no substance in the appellants' submission that they did not expect there would be a period of three months between filing their application on 19 January 2021 and the hearing on 13 April 2021, 4. the fact that the Mr Zammit was busy at work is no reason why the Tribunal should exercise its discretion to grant additional time; busyness is no reason to ignore procedural time limits.
In summary, the appellants submit that: 43. … having a child is certainly not a part of everyday life. Further Mr Zammit did not anticipate his work increasing and getting almost unmanageable. The fit-out was an urgent response to growing demand and could not be avoided at the time. 44. [Their] additional stress due to complications with the pregnancy and extended recovery period, [Mrs Zammit's] promotion, and [Mr Zammit's] increase in workload which required urgent recruitment and office re-fitting.
Our initial view is that this factor does not favour an extension of time. Our view is compounded by the following matters.
First, for at least some period, the appellants had the benefit of legal advice (in this respect we note that letters were sent to the respondent by the appellants' solicitor on 15 September and 5 November 2021).
Secondly, as submitted by the respondent, while the appellants refer to the stress and anxiety associated with the period of pregnancy, combined with increased work busyness levels, which they say combined to prevent them from filing their leave to appeal on time, over the key period in question they emailed the respondent about the Decision and their intention to pursue an appeal.
In this respect, the respondent submits that on 30 April (14 days before the Notice of Appeal was due), the appellants sought the respondent's agreement to a settlement offer. The respondent replied on 3 May 2021, rejecting the offer. The appellants responded "within 12 minutes" to inform the Respondent that they intended to "now go through the Appeal process with NCAT". This was 11 days before the deadline expired, which the respondent submits would have been ample time to complete and file a Notice of Appeal.
We consider that there is substance in the respondent's submissions, and that the reasons for the delay advanced by the appellants do not favour an extension of time.

The extent of any prejudice suffered by the respondent

The question of prejudice to the respondent was not addressed in its written submissions. We asked Ms Birch to identify any prejudice but she was not able to do so. This was probably because in our view there would be little if any prejudice by extending the time in which to file the notice of appeal. This is not a matter where the Tribunal below ordered the appellant to pay monies to the respondent, with the consequence that those monies would need to be repaid as a result of granting the appeal. On the contrary, the application below was dismissed. The respondent does however have a vested right to the decision in its favour.
In our view, this is a neutral factor as to the grant of an extension of time.

The appellant's prospects of success, that is usually whether the applicant has a fairly arguable case

Here there were two key appeal grounds agitated by the appellants. The first was the Tribunal erring in finding that the agreement between the parties had not been frustrated. The second was in the Tribunal's consideration of a "cancellation clause".

Frustration

Having set out the relevant evidence, the Tribunal's findings on this issue were as follows: 41 The parties agree that the [appellants] cancelled the contract on 28 July 2020 when they send an email to the respondent that they were cancelling the wedding as a result of travel restrictions for their guests from Victoria. The [appellants] claim that the contract was frustrated and therefore they are entitled to a refund of monies paid under the contract. 42 Frustration is a common law concept and occurs when circumstances have arisen, by no fault of either party, which result in the obligations under the contract becoming incapable of being performed because circumstances in which performance is called for would render it a thing radically different from that which was undertaken by the contract: Codelfa Constructions Pty Ltd v State Rail Authority of New South Wales (1982)140 CLR 337. Frustration is not defined in the [Frustrated Contracts Act 1978 (NSW)]. 43 Frustration will apply in respect of fundamental obligations in a contract, rather than peripheral ones. Under the common law, a contract is terminated when it is frustrated, and losses lie where they fall. This means that parties will generally not be able to recover amounts already paid. However, the harshness of this rule has been modified by the [Frustrated Contracts Act 1978 (NSW)]. 44 The applicants claim that as almost half of their guests were prevented from attending their wedding that this was beyond contemplation of the parties and would render the performance of the contract radically different to that was proposed in the contract. 45 The respondent claims that the contract was not frustrated as there was nothing in the contract that required the attendance of interstate or overseas guests and they were able to comply with the terms of the contract. 46 The Tribunal is not satisfied that the contract was frustrated. There was no Public Health Order which prevented the wedding from being held with the number of guests as provided in the contract. The "fundamental obligation" under the contract was to provide a venue for the holding of the wedding and its associated functions for 130 guests. There was no Public Health Orders which would have caused such a gathering from being unlawful.
It is common ground that the issue of the border being closed between Victoria and NSW was raised before the Tribunal. However, this was, at best, only inferentially referred to in the Decision. There is some substance in the appellants' submission that the Tribunal failed to consider that the border closure prevented 55% of the appellants' guests from attending.
Frustration occurs where without default by either party a contractual obligation becomes incapable of being performed because the circumstances in which performance is called for renders it "a thing radically different from that which was undertaken by the contract": Davis Contractors Ltd v Fareham UDC; Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337.
in determining a question of frustration the Tribunal must consider the terms of the contract, the nature of the contract, and any relevant surrounding circumstances: Dyco Hotels Pty Ltd v Laundy Hotels (Quarry) Pty Ltd [2021] NSWSC 504.
In our view, it is arguable that had the Tribunal considered the effect of the border closure, it may have come to a difference view about whether or not the contract had been frustrated. However, as we observed in the hearing, that is a matter on which minds may differ. In summary, we consider that this matter was fairly arguable, and favours an extension of time.

Cancellation clause

The relevant clause of the contract between the parties provided that: If you need to cancel? Options: 1. Re-schedule - we are happy to apply a credit (on the balance paid) to another wedding date, or for an accommodation-only stay at Merribee. 2. Total cancellation - a fee of 10% of total booking cost applies. The balance of your stay will only be refunded if and when the period is rebooked by others. Please note, cancellations within 3 months of your event will result in the full forfeit or your payments, alternatively see option 1.
The appellants had argued before the Tribunal that this clause was an "unfair term" within the meaning of the provisions of the Australian Consumer Law (ACL) and was therefore void.
The Tribunal rejected this argument.
In our view, the Tribunal correctly set out the applicable "three-limb test" set out in s 24(1) of the ACL. We see no error in the Tribunal's consideration and application of that test at [47] to [63] of the Decision ("Is the term an unfair contract term?"). In submission, the appellant argued that the cancellation clause was made unfair by subsequent events. This misconceives the unfair contract terms provisions of the ACL, which requires that the clause be unfair on its terms.
This factor does not favour an extension of time.

Conclusion

As we have noted above: 1. the matters relied on by the appellants as to length of the delay in filing the notice of appeal do not favour an extension of time; 2. the matters relied on by the appellants as to the reasons for the delay do not favour an extension of time; 3. the matters relied on by the respondent as to the extent of any prejudice suffered by the respondent are neutral as to the grant of an extension of time; and 4. as to the matters relied on by the appellants as to their prospects of success: 1. we consider the appellants' submissions in relation to the correctness of the Tribunal's decision in relation to the issue of frustration to be fairly arguable; 2. we do not consider that the respondents have a fairly arguable case in relation to the correctness of the Tribunal's decision in relation to the cancellation clause.
In other words, the only factor warranting an extension of time is the fact that there is one fairly arguable matter, namely that the Tribunal failed to take into account the matter of the NSW/Victorian border being closed at the time of the intended date of the wedding.
As the Appeal Panel noted in Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22 relevantly stated at 22: It may be appropriate to go further into the merits of an appeal if the explanation for the delay is less than satisfactory … and, in such a case, it may be relevant whether the appellant seeking an extension of time can show that his or her case has more substantial merit than merely being fairly arguable - Tomko v Palasty (No 2) (2007) 71 NSWLR 61 at [14] (per Hodgson JA, Ipp JA agreeing at [17]) and Molyneux v Chief Commissioner of State Revenue [2012] NSWADTAP 53 at [58] - [59]. (emphasis added)
We are not persuaded that the appellants' argument in relation to the issue of frustration have more substantial merit than being merely fairly arguable.
To paraphrase the Court of Appeal in Tomko v Palsty (No 2) [2007] NSWCA 369 at [80], in this appeal, the appellants seek an indulgence by way of an extension of time. They do so in circumstances where an extension of time will put at risk a vested right of the respondent.
It is sufficient to conclude that they do so in circumstances where they have not provided a satisfactory explanation for their quite considerable delay.
Having taken into account all the matters relied on by the appellants, we do not consider that an extension of time should be granted.

Orders

The Appeal Panel orders: 1. The application to extend the time for filing the notice of appeal is refused. 2. The appeal is otherwise dismissed.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 10 December 2021

Contracts Act 1978(NSW)

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Judgment (12 paragraphs)

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