Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Kumar v RSK Constructions Pty Ltd [2021] NSWCATAP 342 Hearing dates: 27 September 2021 Date of orders: 02 November 2021 Decision date: 02 November 2021 Jurisdiction: Appeal Panel Before: The Hon F Marks Principal Member P H Molony Senior Member Decision: (1) The appeals brought by the appellant are upheld. (2) The orders made by the Tribunal in HB 20/47784 and HB 20/36459 are set aside. (3) The proceedings in HB 20/47784 and HB 20/36459 are remitted to the Tribunal differently constituted for reconsideration in such manner and subject to such conditions as the Tribunal may determine is appropriate in all the circumstances. Catchwords: APPEALS – applications brought before Consumer and Commercial Division – failure by parties to raise issues identified in directions hearings – failure by Tribunal to consider fundamental issues including identification of contracting parties, the contract and compliance with statutory requirements – failure to accord procedural fairness – held proceedings miscarried – orders set aside and proceedings remitted for reconsideration before Tribunal differently constituted. Legislation Cited: Civil and Administrative Tribunal Act s81 Home Building Act ss 7AAA, 10 Cases Cited: Nil Category: Principal judgment Parties: Pardeep Kumar (Appellant) RSK Constructions Pty Ltd (1st Respondent) Mohamed Raees Kirsten (2nd Respondent) Representation: E Georges solicitor (Appellant) M Kirsten agent (Respondents) Solicitors: G & S Law Group Pty Ltd (Appellant) File Number(s): 2021/00138430 Publication restriction: Nil Decision under appeal Court or tribunal: NSW Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Citation: N/A Date of Decision: 5 May 2021 amended 11 May 2021 Before: S Smith General Member File Number(s): HB 20/47784, HB 20/36459 Reasons for decision Background 1. The appellant in these proceedings is Pardeep Kumar. The respondents are RSK Constructions Pty Ltd (first respondent) and Mohamed Raees Kirsten (second respondent). 2. The appellant filed an Application in the Consumer and Commercial Division of this Tribunal on 27 August 2020 (HB 20/36459) against the second respondent later amended so as to seek orders against the first respondent arising out of a contract which he alleged he had entered into for Mr Kirsten to carry out certain concreting and other work in connection with the building of a driveway on a suburban dwelling at a total cost ultimately of $15,600 including agreed extras. The appellant alleged that the work was defective and incomplete, and claimed the sum of $30,000 as the cost of rectification work. On 16 November 2020 the first respondent filed an Application against the appellant (HB 20/47784) seeking payment of $4500 being the amount alleged to be owing to it under that contract which remained unpaid together with "late fees" totalling in all $10,000. 3. Both Applications came on for hearing before a Member of this Tribunal on 5 May 2021. After receiving written documents filed by each party, and hearing what the parties had to say the Member issued amended reasons for decision on 11 May 2021 in which he dismissed the appellant's Application and ordered that the appellant pay the first respondent the sum of $4500 under the first respondent's Application. The appellant has sought leave to appeal and to appeal both these orders. Directions for the preparation of the proceedings for hearing 1. It will immediately be apparent from the brief recitation in [2] above that there was controversy between the appellant and the respondents concerning the identity of the entity with whom or with which the appellant had contracted for the work to be carried out. 2. We have the advantage of a transcript of a second directions hearing conducted by a Principal Member of this Tribunal on 24 July 2021, which we apprehend was not available to the Member from whose decisions these appeals are brought. At that directions hearing the appellant and second respondent appeared in person. The second respondent appears to have represented the first respondent. It is uncontroversial that the second respondent is the principal of the first respondent. 3. The Principal Member proceeded to have the parties identify the parties to the contract which was the basis for these proceedings. Both parties identified the first respondent as being the contracting party. The Principal Member then sought clarification of the contract price. When informed that the initial price was $13,600, the Principal Member asked the second respondent whether there was a written contract which complied with the provisions of the Home Building Act because the contract sum exceeded $5000. The second respondent informed the Principal Member that a mistake has been made and that there was no written contract. After discussion the second respondent agreed that the contracting party would have to proceed with the claim on a quantum meruit. The Principal Member said you understand that probably to be able to get payment for the work you have done, you are going to have to get a quantity surveyor to look at the work and say how much it is worth. You will also have to prove it is free from defects. 1. The second respondent said that he understood this. 2. The appellant then complained that no documents had been served upon him by the respondents. The second respondent disputed this saying that he had forwarded email communications to the appellant. The Principal Member expressed concern that one of the persons appearing before her was "either just mistaken or not telling the truth." 3. The Principal Member then ascertained from the second respondent that the first respondent was unlicensed, but that he held a relevant contractor licence. In order to regularise the proceedings, the Principal Member made orders adding the first respondent as a respondent to the proceedings initiated by the appellant and the second respondent as an applicant in the proceedings initiated in the name of the first respondent. 4. The next directions hearing appears to have been conducted by the Member who ultimately determined the proceedings. We have been provided with a transcript of those proceedings. Both the appellant and the second respondent appeared. 5. The Member discussed with both parties the need for them to have available some form of expert evidence, and in the case of the appellant some evidence substantiating his claim for $30,000 being the cost of rectification. 6. Significantly for our purposes, the Principal Member had made orders requiring the appellant and the respondents to exchange copies of all documents on which they relied according to a timetable which expired on 8 February 2021, with copies also to be provided to the Tribunal. The conduct of the hearing 1. The proceedings came on for hearing before the Member on 5 May 2021. On that occasion the appellant and the second respondent both appeared. 2. When the hearing commenced the appellant complained that he had only received documents concerning the proceedings from the respondents the evening before the hearing, namely on 4 May 2021 and he had not had an opportunity of reading them. The second respondent asserted that the documents had been provided to the appellant at the end of March or the beginning of April. Significantly, however, the Member noted that hard copies of documents had been received by the Tribunal Registry from the respondents on 4 May 2021. The bundle of documents provided by the respondents included two expert reports on which they relied, in reply to an expert report which had been provided by the appellant. 3. There then followed discussion between the Member and each of the persons appearing concerning the adequacy and nature of the opinions expressed by the respective experts retained by each of the parties and concerning also what evidence was available to corroborate the amount of the payments that the appellant said had been made under the contract. In effect the Member proceeded to deal with the substantive proceedings, and then reserved his decision. 4. Evidence given by both parties was to the effect that difficulties arose between them while the work was being carried out concerning the standard of finish, and a claim by the appellant that he had paid too much money to the respondent. The appellant told the respondent that he was not permitted to finish off any outstanding work including rectifying any of the defects, which, on the evidence of the respondents, were insignificant. 5. During the hearing there was disagreement between the parties as to how much money had been paid by the appellant to the respondent. The appellant said that his bank records would demonstrate how much money he had paid, but as the Member noted, no adequate evidence of this was adduced by the appellant. The decision under appeal 1. In his reasons for decision the Member referred to the evidentiary material, said that he preferred the expert evidence tendered by the respondent, and preferred the evidence adduced by the respondent as to the quantum of monies which had been paid over that of the appellant, primarily because the appellant had failed to produce corroborative documentary evidence. 2. On this basis the Member rejected the appellant's arguments that the work carried out by the respondent was defective. He noted that there was minor rectification work that was required to be carried out, but because the appellant had refused to allow the respondent back on the premises, he concluded that the appellant had "unlawfully terminated the contract" by excluding the respondent from the building works. On this basis the Member was not prepared to allow the appellant to make any claim with respect to the cost of rectification of these minor defects. 3. The Member accepted that the respondent had only received $11,100 of the $15,600 owing, and this formed the basis of a monetary order in favour of the respondent in the sum of $4500. The grounds of appeal and other relevant matters 1. When the appeal came on for hearing before us Mr E Georges solicitor sought leave to appear on behalf of the appellant. We note that no application for the appellant to be legally represented had been made to the Tribunal during the course of directions hearings before this Tribunal relevant to the appeal proceedings. The second respondent did not object to Mr Georges appearance. Because we apprehended that these appeal proceedings involve consideration of a number of questions of law, we determined to grant leave for Mr Georges to appear. 2. The hearing of these appeals is governed by section 81 of the Civil and Administrative Tribunal Act 81 Determination of internal appeals (1) In determining an internal appeal, the Appeal Panel may make such orders as it considers appropriate in light of its decision on the appeal, including (but not limited to) orders that provide for any one or more of the following— (a) the appeal to be allowed or dismissed, (b) the decision under appeal to be confirmed, affirmed or varied, (c) the decision under appeal to be quashed or set aside, (d) the decision under appeal to be quashed or set aside and for another decision to be substituted for it, (e) the whole or any part of the case to be reconsidered by the Tribunal, either with or without further evidence, in accordance with the directions of the Appeal Panel. (2) The Appeal Panel may exercise all the functions that are conferred or imposed by this Act or other legislation on the Tribunal at first instance when confirming, affirming or varying, or making a decision in substitution for, the decision under appeal and may exercise such functions on grounds other than those relied upon at first instance. 1. In his Notice of Appeal, the appellant submitted that the Member had, inter alia, engaged in errors of law by denying him procedural fairness in considering the respondent's late service of its documents, and in the manner in which the Member had considered and dealt with the evidence. 2. The full transcript of the proceedings before the Member has been made available to us by the appellant. It indicates that there was no attempt by the Member to ascertain whether and to what extent the appellant had been prejudiced by what he said was the late service of the respondents' documents, asserted to have occurred the evening before the hearing. We would have thought that the receipt by the Tribunal of a hard copy of those documents on the day before the hearing would have been corroborative of the appellant's assertions in this regard. If it were a fact that this was the first occasion on which the appellant had seen the two expert reports upon which the respondents relied, the appellant would clearly have been prejudiced in the presentation of his cases with respect to each of the proceedings. Furthermore, it would have been appropriate in all the circumstances for the Member to have pressed the second respondent concerning the manner in which and the time at which the documents had allegedly been served earlier, together with identification of those documents. 3. For the purpose of the appeal proceedings the second respondent provided a statutory declaration sworn by him on 26 August 2021. In that declaration the second respondent said that he had delivered "my evidence" to the home of the appellant on 7 April 2021 at approximately 9 am. No attempt was made to describe what that "evidence" comprised. The appellant vehemently denied having received any documents from the respondent at that time. We are not prepared for the purpose of these appeal proceedings to conclude that the respondents have established the provision of their documents for the proceedings below on the basis of the statutory declaration provided by the second respondent on appeal. We note, in any event, that even if that evidence had been accepted, the respondents were clearly substantially out of time in providing their documents. 4. The prima facie prejudice suffered by the appellant resulted in the proceedings miscarrying. 5. In addition, neither the parties nor the Member engaged in any discussion concerning the identification of the contracting parties and whether or not there was, in effect, a written contract which complied with the provisions of the Home Building Act and in particular section 7AAA. In argument before us the second respondent endeavoured to rely upon a series of text communications together with a quotation and invoices to constitute an appropriate written agreement. However, such an argument would be futile unless the Tribunal could be assured that all relevant documentation was before it in order to consider it. 6. Furthermore, depending upon the identification of the contractor contracting party, substantive questions concerning enforcement by reason of section 10 of the Home Building Act will also arise. These are matters which the Tribunal is required to consider to found jurisdiction and power to make orders in these proceedings. 7. The parties failed to draw these problems to the attention of the Member, they were not dealt with and as a consequence the proceedings miscarried. 8. We add for completeness that in his reasons for decision in HB 20/47784 the Member said So far as the amounts paid are concerned I accept the evidence of Mr Kirsten that RSK has only received $11,100 of the $13,600 charged. To the extent that the contractor must rely on a quantum meruit no evidence was put to me to suggest that the amounts charged are other than reasonable. 1. There is no other reference in the reasons for decision which would give any indication that the Member was aware of problems in the enforceability of the contract at the hands of either respondent. If the Member was so aware, his reference to reliance on a quantum meruit reverses the onus of proof which clearly falls on the contractor pursuing such a claim, and which must be based on evidence directed to establish a proper and appropriate basis for the calculation of a quantum meruit. The Member made no reference to any such evidence. To this extent, the reasoning of the Member has miscarried. Conclusion and orders 1. Having regard to the matters to which we have referred above, we conclude that the proceedings before the Member miscarried, and that in making the orders under appeal for the reasons relied upon by him the Member fell into error. The orders made by him must be set aside accordingly. 2. Unfortunately, because the fundamental issues which we have identified concerning the identification of the contracting parties, licensing issues, the form of any underlying contract and the basis for calculation of any quantum meruit claim will require reconsideration, it is not appropriate that we deal with these matters as part of the appeal process. On this basis the proceedings must unfortunately be remitted for further hearing. Because the Member has made findings in his reasons for decision concerning certain evidentiary matters relating to the standard of the work performed, any further hearing should be conducted before the Tribunal differently constituted. 3. Because of the errors of law which we have identified it is not necessary that leave to appeal be granted. 4. We make the following orders 1. The appeals brought by the appellant are upheld. 2. The orders made by the Tribunal in HB 20/47784 and HB 20/36459 are set aside. 3. The proceedings in HB 20/47784 and HB 20/36459 are remitted to the Tribunal differently constituted for reconsideration in such manner and subject to such conditions as the Tribunal may determine is appropriate in all the circumstances. ********** 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: 02 November 2021