Zepinic v Chateau Constructions

Vito Zepinic - First Plaintiff PARTIES: Milla Zepinic - Second Plaintiff Chateau Constructions (Aust) Ltd - First Defendant New South Wales Government, Department of Commerce - Consumer, Trader and Tenancy Tribunal - Second Defendant

COUNSEL: Mr M Southwick - Plaintiff/Respondent Mr R Cheney - Defendant/Applicant

SOLICITORS: Hancock Alldis & Roskov - Plaintiffs Toomey Pegg Drevikovsky - First Defendant

Vito Zepinic - First Plaintiff Milla Zepinic - Second Plaintiff V Chateau Constructions (Australia) Limited - First Defendant New South Wales Government, Department of Commerce - Consumer, Trader and Tenancy Tribunal - Second Defendant

JUDGMENT BACKGROUND

1. As at February 2006 Mr and Mrs Zepinic were the registered proprietors of the residential premises at 34 Turramurra Avenue, Turramurra; and Chateau Constructions (Aust) Limited was a building company.

On 23 February 2006 Mr and Mrs Zepinic and Chateau Constructions entered into a building contract by which Chateau Constructions would perform residential building work at the property owned by Mr and Mrs Zepinic.

The building work seems to have progressed without mishap until about November 2006. On 28 November 2006 Chateau Constructions submitted an eighth progress claim to Mr and Mrs Zepinic. It went unpaid. A ninth progress claim was submitted on 20 December 2006. It also went unpaid.

On 18 January 2007 Chateau Constructions commenced proceedings in the Consumer Trader and Tenancy Tribunal to recover the amount of the unpaid progress claims.

On 24 June 2008 Mr and Mrs Zepinic filed a cross-application in the Tribunal claiming, inter alia, damages for defective or incomplete work.

The competing claims were heard by the Tribunal in May and September 2008 at the conclusion of which the Tribunal reserved its decision.

On 18 December 2008 the member of the Tribunal who heard the claims signed and internally "published" the Tribunal's reasons for decision. Chateau Constructions' claims were upheld and the cross-application was dismissed.

On 23 December 2008 the Registrar of the Tribunal wrote to the solicitors for Chateau Constructions providing them with a copy of the Tribunal's decision. The letter was received on 24 December 2008. Although there is no specific evidence concerning this, it would seem more likely than not that the Registrar of the Tribunal also wrote to the solicitors for Mr and Mrs Zepinic on the same day providing them with a copy of the Tribunal's decision. No contrary submission was made in the proceedings before me by counsel for Mr and Mrs Zepinic; nor was evidence called that the letter was received at a time other than 24 December 2008. I find that Mr and Mrs Zepinic became aware of the reasons of the Tribunal on 24 December 2008.

In the reasons for decision to which I just referred, the Tribunal indicated the conclusions it had reached in relation to the various items claimed by Chateau Constructions but made no express finding as to the monetary value of any particular item, nor did it come to any express finding as to the total monetary value of those items.

On 2 February 2009 the proceedings were again listed before the Tribunal. On that occasion: (a) the Tribunal quantified the total amount which it found Mr and Mrs Zepinic liable to pay Chateau Constructions ($370,847.35); and (b) adjourned the matter for further hearing on the question of costs.

On 10 February 2009 the Registrar of the Tribunal wrote to the solicitors for Chateau Constructions confirming the orders orally pronounced on 2 February 2009. The letter also stated that as no "timeframe" had been made as to when payment was to be effected, that question would also be decided at the costs hearing.

On 5 March 2009 the solicitors then acting for Mr and Mrs Zepinic in a letter to the solicitors for Chateau Constructions foreshadowed an appeal in the following terms: "…. We note any Orders of the CTTT have not yet been formally entered pending the decision of the Costs Hearing. We note that we are instructed to file an appeal in the matter and will do so within the requisite time period after the orders are formally entered."

On 18 March 2009 the solicitors acting for Chateau Constructions replied in the these terms: "……. You appear to be of the view that the time within which your clients are entitled to lodge an appeal has not yet expired. If that is your view, we disagree. The time within which your clients could file an appeal expired 28 days after the time on which notice was given to your clients of [the Tribunal's] decision of 18 December 2008. ……"

The matter came back before the Tribunal on 15 April 2009. Prior to that date the legal representatives of Chateau Constructions had provided the Tribunal with written submissions to the effect that it was unnecessary for the Tribunal to make any order as to when Mr and Mrs Zepinic ought make payment because that was covered by rules of court. Notwithstanding those submissions, the Tribunal purported to amend its order of 2 February 2009 so as to make payment due "immediately". The Tribunal also ordered Mr and Mrs Zepinic to pay Chateau Constructions' costs. (I have referred to the Tribunal purporting to amend an order. This was because counsel for Chateau Constructions submitted that such an order was either otiose or ultra vires. It is not necessary for me to make any ruling on that submission.)

On 13 May 2009 Mr and Mrs Zepinic filed a Summons commencing an appeal in this court.

At some point after the Summons was filed (the precise date is not presently before me), the Registrar of the Tribunal gave a certificate referable to the amount which the Tribunal ordered to be paid to Chateau Constructions (cf section 51 of the Consumer Trader and Tenancy Tribunal Act 2001) ("the CTTT Act"), which certificate was filed in the Registry of this court. Upon being filed, the certificate thereafter operated as a judgment of this court.

On 5 June 2009 Chateau Constructions filed a Notice of Motion seeking to have the appeal Summons dismissed as incompetent. The basis of the application was that the Summons had been filed out of time. The Notice of Motion was heard by her Honour Judge Gibb on 3 July 2009 who dismissed the Notice of Motion. Chateau Construction did not file a Summons for leave to appeal in respect of her Honour's order.

On 21 July 2009 Mr and Mrs Zepinic filed an Amended Summons commencing an appeal. The hearing of the Amended Summons was fixed for 5 November 2009.

On 16 September 2009 the Court of Appeal delivered a judgment in Hia Insurance Services Pty Limited v Costas [2009] NSWCA 292.

On 20 October 2009 Chateau Constructions filed a second Notice of Motion seeking to have the Amended Summons dismissed. Unlike the earlier Notice of Motion, this second Notice of Motion did not expressly plead that the ground upon which Chateau Constructions sought to have the appeal dismissed was (again) on the basis that the proceedings were incompetent by reason of the appeal being filed out of time. However, it was subsequently revealed in correspondence between the parties that that was the basis on which Chateau Constructions sought to have the Amended Summons dismissed. The return date of this second Notice of Motion was fixed for 5 November 2009 - the date on which the Amended Summons was also listed for hearing.

THE NATURE OF THE PRESENT APPLICATION 21. On 5 November 2009 both the second Notice of Motion and the Amended Summons were listed for hearing before me. I conducted a hearing only on the Notice of Motion, at the conclusion of which I reserved my decision.

ISSUES FOR DETERMINATION 22. The following issues arise for determination: (a) first, whether it is appropriate that I reconsider an interlocutory issue which has already been decided by another judge of this court; (b) secondly (assuming the answer to the first question is "yes"), whether the summons for appeal was filed within time; and (c) thirdly, if the appeal were filed out of time, whether leave should now be granted to Mr and Mrs Zepinic to extend the time for filing the relevant appeal documents.

The First Issue for Determination: Whether it is appropriate to reconsider an interlocutory issue decided by another judge of the court.

Section 67(1) of the CTTT Act relevantly provides: If, in respect of any proceedings, the Tribunal decides a question with respect to a matter of law, a party in the proceedings who is dissatisfied with the decision may, subject to this section, appeal to the District court against the decision"

Part 50 r50.3 of the Uniform Civil Procedure Rules 2005 relevantly provides: "(1) a summons commencing an appeal must be filed: (a) within twenty-eight days after the material date…"

Part 50 r50.2 defines "material date" as meaning: "(a) if the appeal is from the decision of a court, the date on which the decision is pronounced or given,"

Section 3 of the Civil Procedure Act 2005 defines "court" as including a "tribunal".

At the time Gibb DCJ delivered her judgment there was no relevant authority as to when time began to run for the purpose of an appeal to the District Court from a decision of the Tribunal within the statutory framework set out above.

Her Honour concluded, in the absence of such guidance, that time began to run when the Tribunal made final orders on 15 April 2009. On that basis the summons was filed within time.

Since her Honour's decision, however, the Court of Appeal has delivered a judgment which does provide such guidance: see HIA Insurance Service Pty Limited v Costas [2009] NSWCA 292.

Although the previous rule about no permitting a party to have a re-run of an interlocutory decision unless there is a material change in circumstance (cf. Brimaud v Honeysett Instant Printing Pty Limited (1988) 217 ALR 44) seems to have been ameliorated in recent times (see Nominal Defendant v Manning (2000) 50 NSWLR 139; and National Parks & Wildlife Service v Peirson (2002) 55 NSWLR 315), in my opinion, the decision of the Court of Appeal is a relevant and material change which would permit me to again consider the question of whether the appeal was incompetent by reason of being filed out of time.

Accordingly, I propose to undertake that exercise.

The Second Issue for Determination: Whether summons for appeal was filed within time.

Traditionally, at least in the context of court proceedings, calculating the period of time for the purpose of bringing an appeal usually commenced to run from the pronouncement by the lower court of final orders.

However, in HIA Insurance the Court of appeal held in the context of section 67 of the CTTT Act that the calculation of time did not commence with the making of "final and operative orders" but, rather, from an earlier point, namely when the Tribunal decided the relevant question.

In the present case that relevant question was decided by the Tribunal on 18 December and communicated to the parties on 24 December 2008. As an examination of the grounds of appeal in the Summons and the Amended Summons will make clear, Mr and Mrs Zepinic challenge the reasoning behind that decision and not the computation of the precise value of Chateau Constructions' claim, nor the orders for costs, nor from when they were required to make the relevant payment.

Accordingly, therefore, in my opinion time began to run for the purpose of the twenty-eight (28) day rule from 24 December 2008.

The filing of the Summons on 13 May 2009 was therefore out of time by approximately three and a half months.

The Third Issue for Determination: Whether leave should now be granted to Mr and Mrs Zepinic to extend time.

As I noted above, on 18 March 2009 the solicitors acting for Chateau Constructions placed the solicitors for Mr and Mrs Zepinic on notice that the appeal period had expired.

Part 50.3 of the UCPR provides as follows: "(1) A summons commencing an appeal must be filed: (a) within twenty-eight (28) days after the material date, or …….. (c) within such further time as the higher court allow. (2) An application for an extension of time under sub-rule (1)(c) must be included in the summons commencing the appeal.

Notwithstanding that Mr and Mrs Zepinic (through their solicitors) were on notice from 18 March 2009 that Chateau Constructions intended to take the point that the appeal had been lodged out of time, the Summons filed on 13 May 2009 did not include an Application for an Extension of Time under sub-rule (1)(c).

Neither was such an application made in the Amended Summons filed on 21 July 2009 - no doubt because of the judgment of Gibb DCJ on the first Notice of Motion.

Significantly, however at the commencement of the hearing of the application before me on 5 November 2009 there was no Further Amended Summons filed by Mr and Mrs Zepinic (even though by that stage they were aware of the true nature of the Second Notice of Motion).

It was only after the evidence on the application had closed and during oral submissions after the luncheon adjournment (and then only in response to a remark from me) that counsel for Mr and Mrs Zepinic made an oral application for an extension of time. This application was opposed by counsel for Chateau Constructions: first, because an oral application for such relief is inconsistent with Part 50 r50.3(2); and secondly because Chateau Constructions would have put on evidence as to prejudice to oppose the granting of leave for such an extension - Chateau Constructions had not been afforded the opportunity of adducing such evidence because of the nature and timing of the oral application.

The objects of the CTTT Act are, inter alia, as follows: "(b) to ensure that the Tribunal is accessible, its proceedings are efficient and effective and its decisions are fair, (c) to enable proceedings to be determined in an informal. expeditious and inexpensive manner."

Section 56 of the Civil Procedure Act 2005 relevantly provides: "(1) The overriding purpose of this Act and of rules of court, in their application to civil proceedings, is to facilitate the just, quick and cheap resolution of the real issues in the proceedings. (2) The court must seek to give effect to the overriding purpose when it exercises any power given to it by this Act or by rules of court and to when it interprets any provision of this Act or of any such rule."

In order to entertain Mr and Mrs Zepinic's oral application, it would be necessary for me to dispense with the requirement of Part 50 r50.3(2). No proper or adequate reason was advanced as to why (before the afternoon of 5 November 2009) Mr and Mrs Zepinic had not filed a Further Amended Summons nor given notice of such and intention so that Chateau Constructions could have had a reasonable opportunity to prepare its evidence as to prejudice. The absence of proper or adequate reasons in this context militates against the dispensation sought. (cf Iovanscu v McDermott [2004] NSWCA 106; and Morres v Papuan Rubber and Trading Company Limited (1914) 14 SR (NSW) 141).

The relevant decision of the Tribunal was effectively received by the parties almost one year ago. Whilst some of the delay thereafter cannot be attributed to Mr and Mrs Zepinic (for example in the period between the dismissal of the first Notice of Motion by Gibb DCJ and the delivery by the Court of Appeal of the judgment in Hia Insurance Service), nevertheless, with reasonable diligence and expedition, the question of leave to appeal out of time ought to have been anticipated and appropriate notice given and evidence marshalled so that it could have been determined along with the second Notice of Motion on 5 November 2009.

If I were to permit Mr and Mrs Zepinic to make the oral application they now seek to make, the effect would be that the hearing of that application could not be determined before February 2010. Such delay would in my opinion be inconsistent with the statutory purposes identified in paragraphs 43 and 44 above. DECISION 48. In the result, I make the following orders: 1. I refuse to grant leave to the plaintiffs/respondents to make an oral application to extend time to file a valid summons commencing an appeal.

2. I order the Amended Summons be dismissed. 3. I order the plaintiffs to pay the first defendant's costs of the proceedings and of the Notice of Motion filed 20 October 2009. 4. I order that the costs referred to in the preceding order be assessed on a party/party basis. 5. I make no order as to the costs of the second defendant` to the intent that each of the plaintiffs and the second defendant should bear their own costs of the proceedings.

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.