Civil and Administrative Tribunal New South Wales Medium Neutral Citation: White v McClellan [2022] NSWCATAP 340 Hearing dates: 26 September 2022 Date of orders: 02 November 2022 Decision date: 02 November 2022 Jurisdiction: Appeal Panel Before: S Thode, Principal Member D Fairlie, Senior Member Decision: 1. Leave to Appeal refused. 2. Appeal dismissed. Catchwords: APPEALS – Home Building Act 1989 – decision against the weight of evidence - assessment of compensation Legislation Cited: Civil and Administrative Tribunal Act 2013 Civil and Administrative Tribunal Rules 2014 Home Building Act 1989 Cases Cited: Bellgrove v Eldridge [1954] HCA 36 Collins v Urban [2014] NSWCATAP 17 Cominos v Di Rico [2016] NSWCATAP 5 Haines v Bendall [1991] HCA 15 Haset Sali v SPC Limited [1993] HCA 47 Prendergast v Western Murray Irrigation Limited [2014] NSWCATAP 69 Category: Principal judgment Parties: David White (Appellant) Melissa and Mark McClellan (Respondents) Representation: Appellant in person Respondents in person File Number(s): 2022/00211979 Publication restriction: Nil Decision under appeal Court or tribunal: Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Date of Decision: 13 July 2022 Before: I Archibald, Senior Member File Number(s): HB 21/44602 REASONS FOR DECISION Background 1. This is an internal appeal under s 80(2) of the Civil and Administrative Tribunal Act 2013 (the NCAT Act) against a decision made in the Consumer and Commercial Division of the Tribunal on 13 July 2022. The matter concerns "residential building work" within the meaning of clause 2(1)(c) of Schedule 1 to the Home Building Act 1989 (NSW) (the HBA). 2. The appellant is a painter. The respondents are homeowners. On 1 November 2019 the appellant provided a quote to the respondents in the amount of $13,970 including GST, for painting work at their premises at Cessnock. The quote, on the letterhead in2paint, was in the following terms: Exterior: Weatherboard Home Low and high pressure washing and cleaning of all exterior surfaces to be painted. Sand all previously painted surfaces including scraping any loose or flaking paint before sealing surfaces. Caulk gaps where required. Apply stained blocker as required. All previously painted surfaces: Weatherboards, eaves, doors, windows and metal railing at front. Apply two coats of Taubmans premium exterior paint to all surfaces. Quote includes a 2x colour scheme. Colours and sheen level to be advised by client. Care will be taken to protect all exterior surfaces around your home including driveway, gardens and grassed areas. All paint and sundries are included. Please note as discussed we will high - pressure clean the roof on the areas that can be seen from the road. 1. The respondents accepted the quote and the appellant carried out the work in March and April 2020. Approximately three months after the work had been completed, the respondents said that they noticed that the paint was "bubbling", and that by 20 December 2020 cracks were appearing, exposing raw timber. The appellant said that the problem was due to moisture issues, probably caused by leaks in the roof of the house. 2. The parties could not resolve their dispute and the respondents commenced proceedings in the Tribunal on 28 October 2021. They sought orders that another contractor be appointed to carry out rectification work to their premises and that all costs associated with that work be paid for by the appellant. 3. The matter was heard on 9 May 2022 and on 13 July 2022 the Tribunal published its Order and Reasons for Decision (the Decision). The Tribunal found in favour of the respondents. The Member also accepted the respondents' submission that another contractor be engaged and did not order the appellant to carry out the work as provided in s 48O(1)(c) of the HBA. Instead he ordered under s 48O(1)(a), that the appellant pay to the respondents by way of damages, the sum of $45,000. The decision below 1. Paragraphs 22 - 33 of the Decision contain the Member's findings and are set out below: CONSIDERATION 22 I will deal first with the significance or otherwise of the "Terms and Conditions" relied upon by the respondent. Prior to the hearing the applicant(s) had filed with the Tribunal an ASIC Company Extract in relation to a corporation called IN2PAINT [ACN 636312715] with [ABN] 99636312715. Following the hearing I directed that the applicant and the respondent file submissions as to which person or entity was the proper respondent as this was relevant as to whether (the) Terms and Conditions document at Appendix C to the respondent's submissions formed part of the agreement between the parties or not. 23 The applicants filed a submission that the proper respondent to the application should be "David White trading as in2paint [ABN 53 364 854 924 as per the signed quote dated 1 November 2019. The applicants said that they had accepted the Quotation by David White and were not aware that the company existed at the time. The applicants submitted further that the terms at Appendix C expressly dated (sic – stated) they form part of an Agreement between In2Paint Pty Limited ABN 99 636 312 715 and the "customer" and that they did not enter into a contract with that corporation. 24 The respondent did not file a submission. I accept the submission of the applicants on the basis that they did not intend to enter into legal relations with the corporation called In2Paint Pty Limited. There was no reference to this corporation in the Quotation. Accordingly I find that the Terms and Conditions did not form part of the agreement between the parties and that it is not necessary to change the name of the respondent to the application. 25 However even if the "Terms and Conditions" in Appendix C did form part of the painting contract, I find that section 18G of the HBA has the effect that the purported exclusion of warranties in clause 9.3 of Appendix C is void as against the implied section 18B warranties. Section 18B(1) states that the statutory warranties are implied into every contract to do residential building work. 26 Section 18G of the HBA provides as follows: A provision of an agreement or other instrument that purports to restrict or remove the rights of a person in respect of a statutory warranty is void. 27 The words "in respect of" as used in s18G have been interpreted by the High Court and the NSW Court of Appeal. In Antico v CE Heath Casualty General Insurance, 38 NSWLR 681 at 696, Kirby P cited with approval a passage in Trustees Executors and Agency Company Limited v Riley [1941] VicLawRp22; [1941] VLR 110 and 111, where Mann CJ said: 'The words "in respect of" are difficult of definition, but they have the widest possible meaning of any expression intended to convey some connexion or relation between the two subject matters to which the words refer.' 28 In my opinion clause 9.3 of the Terms and Conditions within Appendix C does "purport" to restrict or remove the rights of the applicants in respect of the statutory warranties. It states that the (contractual) warranty in clause 9.1 does not cover and we will in no way be liable for any claim arising out of or in connection with (relevantly) (a) substrates with existing corrosion or moisture ingress; (b) surfaces affected by building movement or structural issues; (c) settling, movement, cracking, lifting, peeling, flaking, deterioration or other failure of the substrate or a previous surface coating; (e) ferric materials with existing rust conditions or non ferric metals with existing oxidising issues; and (h) any part of the works where we have notified you that a surface is unsuitable for a particular coating and you direct us to apply that coating. 29 Hence, clause 9.3 goes beyond stating that the clause 9.1 warranty does not apply and states that in "no" way will the contracting party be liable. Accordingly I find that clause 9.3 does purport to restrict or remove the rights of the applicants in respect of the statutory warranties and if you did apply (it) to the contract between the applicant and the respondent (it) is void. 30 In relation to whether or not the HBA s18B warranties have been breached, I prefer the evidence of Mr Goodwin, Mr Smaller and the applicants to that of the respondents. Mr Goodwin conducted a thorough examination of the site using, inter alia, probes of the thickness of the paint, moisture level readings, inspection of sub floors, inspection of the roof space and thermal imaging. 31 I turn now to the evidence from the respondent that he had advised the applicants to undertake a "full strip back" and that he had discussed with the applicants the "potential issues" arising from not conducting such an operation but that the applicants had instructed him to go ahead. This was denied by the applicants. Putting aside for the moment the question as to which of the two versions should be believed, it seems to me that the substance of the respondent's defence is caught by section 18F of the HBA which provides relevantly as follows: Defences 18F Defences In proceedings for a for a breach of a statutory warranty, it is a defence for the defendant to prove that the deficiencies of which the plaintiff complains arise from - instructions given by the defendant or person who did the work, being advice given in writing before the work was done. 32 There is no evidence that the respondent advised the applicant in writing not to conduct the full strip back. Accordingly even if I accept that the respondent's evidence as to the advice he gave the applicants, such advice was not given in writing and for this reason the defence is not made out. This finding would also overcome the respondent's reliance on the email from the applicant stated 21 July 2020 (after the work had been carried out) as referred to in [15] above. 33 Accordingly I find that in his performance of the painting work at the premises the respondent breached the warranties in s 18B(1)(a)(b)(d) and(f) of the HBA and he is liable to the applicants for this breach. 1. In relation to the order that the appellant pay to the respondents the sum of $45,000, the Tribunal found, at paragraph [13(11)] in the Decision that: Mr Goodwin (the respondents' expert) gave final details of the cost of remediation as follows: 9.1 scaffolding of entire house and soda blasting of all affected exterior cladding paintwork. Soda blasting of front veranda handrails and balustrading, including sanding and grinding of underlying rust - $28,000 including GST. 9.2 preparation of bare surfaces with appropriate Undercoat Sealers and Primers to metal surfaces if required prior to Priming Coat. Two New Coats of Recommended Exterior Paint as per Taubman's Technical Representative recommendations - $15,000 including GST. 9.3 clean all previous paint spills and splashing to garden surrounds, driveway slabs and path slabs - $2,000. Total Remediation Costs $45,000 including GST. 1. And at paragraph 37 that: I find that Mr Goodwin's evidence supported as it was by Mr Smaller (the respondents' other expert) is persuasive as to the cost of remediation and for this reason the order of the Tribunal will be that the respondent pay the applicants $45,000 by way of damages within 14 days. Scope and nature of internal appeals 1. Internal appeals may be made as of right on a question of law, and otherwise with permission (that is, the "leave") of the Appeal Panel: s 80(2) of the NCAT Act. 2. In Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69 the Appeal Panel set out at [13] a non-exclusive list of questions of law: 1. Whether there has been a failure to provide proper reasons; 2. Whether the Tribunal identified the wrong issue or asked the wrong question; 3. Whether a wrong principle of law had been applied; 4. Whether there was a failure to afford procedural fairness; 5. Whether the Tribunal failed to take into account relevant (i.e., mandatory) considerations; 6. Whether the Tribunal took into account an irrelevant consideration; 7. Whether there was no evidence to support a finding of fact; and 8. Whether the decision is so unreasonable that no reasonable decision-maker would make it. 1. The circumstances in which the Appeal Panel may grant leave to appeal from decisions made in the Consumer and Commercial Division are limited to those set out in cl 12(1) of Schedule 4 of the NCAT Act. In such cases, the Appeal Panel must be satisfied that the appellant may have suffered a substantial miscarriage of justice on the basis that: 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 time the proceedings under appeal were being dealt with). 1. In Collins v Urban [2014] NSWCATAP 17 (Collins v Urban), the Appeal Panel stated at [76] that a substantial miscarriage of justice for the purposes of cl 12(1) of Schedule 4 may have been suffered where: … there was a "significant possibility" or a "chance which was fairly open" that a different and more favourable result would have been achieved for the appellant had the relevant circumstance in para (a) or (b) not occurred or if the fresh evidence under para (c) had been before the Tribunal at first instance. 1. Even if an appellant from a decision of the Consumer and Commercial Division has satisfied the requirements of cl 12(1) of Schedule 4, the Appeal Panel must still consider whether it should exercise its discretion to grant leave to appeal under s 80(2)(b). 2. In Collins v Urban, the Appeal Panel stated at [84] that ordinarily it is appropriate to grant leave to appeal only in matters that involve: (a) issues of principle; (b) questions of public importance or matters of administration or policy which might have general application; or (c) 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; (d) a factual error that was unreasonably arrived at and clearly mistaken; or (e) 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. 1. In Cominos v Di Rico [2016] NSWCATAP 5 (Cominos v Di Rico), the Appeal Panel stated at [13]: 13. It may be difficult for self-represented appellants to clearly express their grounds of appeal. In such circumstances and having regard to the guiding principle, it is appropriate for the Appeal Panel to review an appellant's stated grounds of appeal, the material provided, and the decision of the Tribunal at first instance to examine whether it is possible to discern grounds that may either raise a question of law or a basis for leave to appeal. The Appeal Panel has taken such an approach in a number of cases, for instance, Khan v Kang [2014] NSWCATAP 48 and Prendergast v Western Murray Irrigation Ltd [2014] NSWCATAP 69. However, this must be balanced against the obligation to act fairly and impartially (Bauskis v Liew [2013] NSWCA 297 at [68] citing Hamod v State of New South Wales [2011] NSWCA 367 at [309]-[316]). Relevantly, s 38(2) provides that that Tribunal "may inquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of natural justice. Submissions and evidence 1. In deciding the appeal, the Appeal panel has had regard to the following written material: 1. The Notice of Appeal lodged filed on 20 July 2022 and its attachments; 2. The appellant's written submissions and its attachments; 3. The respondents' written submissions and their attachments. 1. The parties also made oral submissions at the hearing. The appellant attended in person and the respondents by audio visual link. The parties were unrepresented, but the appellant's spouse was also present during the hearing and assisted him with his presentation. 2. The Notice of Appeal and its attachments identified a number of findings in the Decision which the appellant believed to be wrong, with the result that he submitted that the order requiring him to pay to the respondents the sum of $45,000 should be set aside. At the beginning of the hearing the Appeal Panel, following the approach taken by the Appeal Panel in Cominos v Di Rico, formulated these issues into six distinct grounds of appeal. The appellant agreed with this formulation. 3. The grounds were that: 1. The Tribunal should have granted the appellant an adjournment on medical grounds as he had requested; 2. The Tribunal should have accepted that the entity which entered into the contract with the respondents was In2Paint Pty Limited and not the appellant personally; 3. The Tribunal should have found that the Terms and Conditions relied on by the appellant formed part of the relevant contract, and that they were not void; 4. The Tribunal should have found that the cause of the paintwork "bubbling" and cracking was due to subsequent water ingress into the residence; 5. The Tribunal should not have accepted the evidence of the respondents and their witnesses but should have preferred his evidence; and 6. The Tribunal should have found that the amount awarded to the respondents was excessive and not supported by the evidence set out in the Scott Schedule. 1. Ground 1, 2 and 3 appear to involve questions of law, or at least questions of mixed fact and law, whereas grounds 4, 5 and 6 require leave to appeal in conformity with the principles that we have referred to above. In relation to those later grounds the appellant asks for leave to appeal and states that he may have suffered a substantial miscarriage of justice because the decision was not fair and equitable, the decision was against the weight of evidence or significant new evidence is now available that was not reasonably available at the time of the hearing. The appellant did not challenge the Member's decision that he pay damages rather than being ordered to carry out the rectification work himself. Notice of Appeal 1. The Notice of Appeal was lodged on 20 July 2022, which is within the 28 day time period specified in cl 25(4) of the Civil and Administrative Tribunal Rules 2014. Consideration 1. We will now deal with each of the appellant's grounds of appeal in turn. Ground 1 - the appellant's submissions 1. The appellant said that on 3 May 2021, that is six days before the date of the hearing, his spouse, on his behalf, made an application in writing to the Registrar seeking an adjournment due to mental health reasons. The application said that the appellant's psychologist and psychiatrist had both advised that he needed to get representation as he was unfit to participate. The letter also stated that he had "an adviser" who could represent him. The adviser was a consultant specialising in general building and waterproofing defects, but due to long standing commitments he was unavailable on 9 May, but would be available on 8 June. 2. The appellant said that the Registry informed him or his spouse that he should apply for the adjournment at the commencement of the hearing the following week, which he did. By that date he had obtained letters from his two psychologists and a psychiatrist each dated 5 May 2021, which he said he tendered to the Tribunal. The letter from the psychiatrist stated in part that: Lately his mood has been depressed and it would be difficult for him to attend the planned (hearing) on 9 May 2021. 3. Having heard the adjournment application the appellant said that the Member decided that the hearing should proceed and said words to the effect of "we will see how we go" and "you are just going to have to cope". The appellant said his mental state on the day was such that was not able to fully explain his case to the Member. The appellant's spouse was not present on that occasion. Ground 1- the respondents' submissions 1. The respondents did not disagree with the appellant's account of what was said in relation to the adjournment application. However they submitted, as was apparent from one of the psychologist's letters tendered, that the appellant's medical issues were not new, as he had been receiving treatment since 2013. They also said that he had left his adjournment application to the last minute. Ground 1 - Consideration 1. A refusal to grant an adjournment may amount to a denial of natural justice which in turn may constitute an error of law: Haset Sali v SPC Limited [1993] HCA 47 at [10]. Likewise, so may a failure by the Tribunal to allow a party to adequately explain his or her case. The difficulty that the Appeal Panel is confronted with is that we have not been provided with a transcript of what occurred at the hearing on 9 May 2022. There is also no mention of the adjournment application in the Decision. 2. On 10 August 2022 Principal Member Suthers made the usual directions when the appeal was set down for hearing. This included direction 4(d) that the appellant should lodge with Appeal Registry and give to the respondents: (d) If oral reasons were given and/or what happened at the hearing at first instance is being relied on by the Appellant to the appeal, a typed transcript of the relevant parts of the hearing, together with a sound recording of the entire hearing. 1. The appellant did not provide the Appeal Panel either with a transcript of any part of the hearing or with the sound recording. If the appellant wished to submit that his adjournment application was wrongly decided or that otherwise he did not get a fair hearing, it was incumbent on him to do so. 2. The best that the Appeal Panel can do is to review the Decision and to draw what inferences we can from that document as to how the hearing was conducted. Adopting this approach, it seems that the Member has given each of the appellant's submissions and supporting evidence due consideration when making his findings which we have set out above. We are unable to identify any matter where the Member has failed to take into account an issue which is now a ground of appeal, or that he had misunderstood any of those grounds because the appellant was unable to articulate them. 3. In these circumstances we reject this ground of appeal. We add that even if we were to have upheld it, we would have remitted the matter for a further hearing in the Tribunal, and for the reasons that follow, it is unlikely that this would result in a different outcome. Ground 2 - the appellant's submissions 1. The appellant said that he had traded under his own name as in2paint with the ABN 53 364 854 924, until 30 September 2019 when he cancelled his ABN. On 1 October 2019 the corporate entity, IN2PAINT Pty Limited, ABN 99 636 312 715, was registered and carried on the business thereafter. 2. The appellant said that it was "a clerical error" that the quote was issued to the respondents on 1 November 2019 in his name rather than in the company's name and that there was a reference to a website www.in2paint.com.au on the quote which would have revealed the existence of the company. 3. Further he said that the respondents were aware of the existence of the company because they had carried out a search at ASIC of the corporate entity's business number, and also that the company name was included on the side of his trade vehicle. Ground 2 - the respondents' submissions 1. The respondents repeated their Tribunal submission that they were not aware, at the time the contract was entered into, of the existence of the appellant's company and believed that they were contracting with him personally. Ground 2 - consideration 1. As is apparent from paragraphs [22 -24] of the Reasons which we have set out above, the Tribunal considered this issue in detail, even allowing the parties to make further written submissions after the conclusion of the hearing. In our opinion the evidence supports the Tribunal's conclusion that, at the time the respondents accepted the relevant quotation, they believed that they were contracting with the appellant personally and not with his company. 2. We make two further observations. First, the fact that the respondents subsequently became aware of the existence of the corporate entity, does not negate this conclusion. The respondents were entitled to believe that the appellant was continuing to trade in his own name for existing contracts and that the corporate entity would be used for new engagements. There is nothing unusual or improper in trading simultaneously in both capacities. 3. Secondly, there is no evidence that the appellant expressly informed the respondents that he believed that his company had entered into the contact until well after the dispute between the parties had arisen. Indeed, in his emails to the respondents up to 15 January 2021, which were in evidence before the Tribunal, the appellant described himself as Dave White, Project manager & Master Painter. The emails do not refer to the appellant's corporate entity. This Ground of appeal must fail. Ground 3 - the appellant's submissions 1. The appellant referred us to clause 9.1(a) of the terms and conditions set out on the website of In2Paint Pty Limited to the effect that his corporate entity was not liable for claims arising out of or in connection with substrates with existing corrosion or moisture ingress. He said that moisture ingress was the cause of the paint work failing and that he should not be liable to pay for the restoration work as ordered by the Tribunal. Ground 3 - the respondents' submissions 1. The respondent referred to the Tribunal's Reasons at [25-29], which we have set out above, and said that there was no basis for disturbing those findings. Ground 3 - consideration 1. As we understood the appellant's case, his submission, that that the terms and conditions formed part of the contract between the parties, was only pressed on the basis that the Appeal Panel accepted his argument that the relevant agreement was entered into between the respondents and the corporate entity. As we have already rejected this ground, the submission must fail also. However, even if the contract were between the respondents and the corporate entity, we would not have accepted the argument. The Tribunal's finding at [25 -29] that s 18G of the HBA has the effect of making clause 9.1 of the terms and conditions void because the clause purports to restrict the rights of a person in respect of the statutory warranties set out in s 18B(1) of the HBA, implied into every contract for residential building work, is clearly correct. Ground 4 - the appellant's submissions 1. The appellant said that the Tribunal was wrong to conclude that the cause of the paintwork bubbling and peeling was due to his inadequate preparation and handiwork - as found by the respondents' expert, Mr Goodwin. Instead the cause was "the pooling of water in the roof cavity" of the respondents' property, exacerbated by "the enormous amount of rain" the Cessnock area had received soon after he had completed his work. He said that before he commenced the work, he had tested the site and had detected no moisture. 2. In his written submissions for the appeal he said that "being a weather board home, water can travel from the ground or the roof (and) the wall substrates will be affected due to moisture pushing from behind and compromising paint adherence". He drew our attention to the quote dated 3 February 2021 prepared for the respondents by Newcastle Roofing Professionals after their inspection of the property and in evidence before the Tribunal, which noted some cracked tiles and said, in part, in relation to roof repairs to "drill weep holes to top ridge as required (this will stop water pooling under the ridge caps allowing water to drain on roof tile rather than overflowing into roof cavity", and to replace the awning roof. 3. The appellant said that more weight should have been given to this evidence as "it shows that the issue was a maintenance issue with the property that (was) not been upkept by the owners and (that it was) not a painting problem". 4. In relation to the scope of the work undertaken by the appellant, he said that he had carried out all the work referred to on his quote, but drew the Appeal Panel's attention to his evidence before the Tribunal, that before commencing the work, he had advised the respondents that he should undertake "a full strip back", but that they had instructed him to proceed without his doing this work. He also referred to an email from the respondents to him dated 21 July 2021, where they had said "We had our house painted to be tidied up…." 5. The appellant also provided to the Appeal Panel an email from Taubmans PPG to him dated 25 August 2022 which stated in part: We could not carry out a detailed investigation as no dry flakes (from the respondents' property) have been supplied. We had noticed in the pictures supplied that most of the paint blistering has taken place near timber joints and cracks. The paint in other areas looks sound. The picture with a blister opened shows the blister going right through to the substrate. These factors imply water ingress is the major contributing factor to the paint blister formation. Water may have gone into the timber via cracks and joints between the timbers....….. and Conclusion: In our opinion moisture in the substrate is the most likely cause for the adhesion failure. 1. The appellant said that the opinions contained in this email were compelling evidence supporting his submission that he was not responsible for the failure of the paint work. As is apparent from its date, the email was not in evidence before the Tribunal. 2. The appellant also sought to tender some newspaper articles and other material relating to rainfall in NSW in 2021 and a flood plain map from the Cessnock City Council. He also produced a brochure relating to a Workzone digital moisture meter. He said this was the meter used by the respondents' expert Mr Goodwin when testing for moisture. He said that this piece of equipment is available from retail outlets and is not a sophisticated product and it is inferior to the moisture meter that he had used. Again, none of these documents were in evidence before the Tribunal. Ground 4 - the respondents' submissions 1. The respondents relied on the conclusions of their expert Mr Goodwin, dated 16 October 2021 which the Member has considered and accepted in his Reasons. Mr Goodwin visited and inspected the respondents' premises on two occasions, on 28 January 2021 (when he provided a draft report), and again on 28 September 2021. In his second report he said that he had found approximately 70% of the exterior paint work to the timber cladding was affected by bubbling and peeling surfaces and that rust staining was penetrating through new paint work to the front veranda handrails and balustrading to approximately 30% of the painted surfaces. 2. Mr Goodwin said that there was no evidence of water staining or mould to the eave sheeting or evidence of overflowing issues to the guttering. The subfloor areas were also found to be consistently dry through with no evidence of water pooling or moisture and further that his inspection had been undertaken after a period of prolonged rainfall though the prevailing weather had been sunny and dry for the two days preceding his inspection. His moisture meter and thermal imaging camera readings were the same as those recorded on his first inspection in January 2021. 3. Mr Goodwin had also expressed the opinion in his report that: It is my professional opinion that the original paint work to the cladding, handrails and balustrading were not adequately cleaned, scraped or sanded prior to the application of new exterior finishes. From visual examination of the peeling paint work, no undercover or sealing compound had been applied over the original cladding and paintwork. Inadequate cleaning of rusted areas to the handrails and balustrading has been undertaken. No application of a rust inhibitor or appropriate primer has been undertaken to prevent further rusting under the new paint work. The remaining old paint work to the timber cladding is dislodging and causing the new paint work to bubble and peel. 1. The respondents submitted that Mr Goodwin's report provided all the evidence necessary for the Tribunal to find as it did in favour of the respondents. 2. In relation to the quote from Newcastle Roofing Professionals, on which the appellant relied, they referred to a subsequent exchange by sms with that company as follows: Thanks Megan for the quote however I cannot see on it anywhere that you have put the paragraph that you said about the roof not having any affect (sic) on the walls of the house, We are considering the quote however if you could please send me even a text message stating about the walls I would much appreciate (it). and the reply from Newcastle Roofing Professionals: There is no water penetrating through the roof and is not running through to the outer walls, there are no fretted tiles and the guttering is clear of debris. 1. In relation to the recent email from Taubmans PPG to the appellant, the respondents referred to an earlier email to them from Taubmans PPG dated 22 January 2021 which was in evidence in the Tribunal proceedings and which they said came to a different conclusion. This email came from "Wayne at the Taubman's Paint Team". His name also appeared on the subsequent August 2022 email which the appellant sought to tender. The January 2021 email said in part: The reverse site (sic) of the grey/white paint has brown coloured material attached to it. The new paint is peeling due to the brown material underneath letting go and taking the new paint with it. When repainting it is always important to make sure that any existing paint has enough life left in it and is secure enough to support the new paint. There appears to be profile evidence of pre existing cracks and peeling. Painting over paint that already has evidence of cracking /peeling is not done without risk. Cannot comment on excessive water ingress behind the paint as there is nothing seen in the photos that confirms this. Rust on the front railing can be due to not using an appropriate anti corrosive painting system or not the right prep. 1. The respondents also denied that they instructed the appellant not to undertake a full strip back, and that the reference to their house being "tidied up" was not a reference to the quality of the paint work that they expected. Lastly, they also sought to tender rainfall records which they said, presented a more accurate reflection of the weather prior to Mr Goodwin's inspections. Ground 4 - our findings 1. We will deal first with the new evidence that the appellant wishes to rely on. As we have set out above, clause 12(1) of Schedule 4 of the NCAT Act provides that such evidence must be significant and not reasonably available at the time the proceedings under appeal were dealt with. The flood plain map, weather records and moisture meter brochure were clearly available for the appellant to tender before the Tribunal hearing and we therefore do not propose to admit them as evidence in the appeal. The same applies to the weather records that the respondents sought to tender. 2. The email from Taubmans PPG to the appellant dated 25 August 2002 is perhaps in a different category. The appellant said that he only became aware, when preparing for the appeal, that the earlier email from Taubmans, on which the respondents had relied, had not involved an on site inspection of the property, and was based on photographic evidence. He would have approached Taubmans earlier had he known this. 3. We are inclined in these circumstances to allow this email into evidence in the appeal. It also follows on from the earlier email from Taubmans PPG relating to the same issue. However, contrary to the appellant's submission, we do not consider that this second email provides a basis for the Appeal Panel upholding this ground of appeal. 4. Firstly, as with the earlier email, the conclusions set out in it are also based on photographs and not on a site inspection. Secondly, the conclusions expressed in the email that the photographs imply that water ingress is the major contributing factor to the paint failure, and that water may have got into the timber via cracks, are not sufficiently persuasive to displace Mr Goodwin's contrary conclusions which he expressed after two on site inspections. 5. We also do not find that the appellant's other submissions in support of this ground of appeal to be persuasive. His approach in the Tribunal hearing, was to rely on his own expertise. He did not tender any independent expert evidence in response to Mr Goodwin's evidence or the evidence from Newcastle Roofing Professionals and Taubmans PPG, also relied on by the respondents. Nor it appears did he put any questions to Mr Goodwin during the hearing about Mr Goodwin's conclusions, nor require representatives of the other entities to attend the hearing. 6. That is not to say that it is necessary on all occasions to obtain an independent expert report. However in this instance, where the respondents' expert had not only concluded that water ingress was not the cause of the bubbling and cracking, but had found that the appellant had not cleaned scaped, sanded or sealed the surface before commencing the painting, it was incumbent on the appellant to tender evidence to the contrary. In the absence of any such evidence, the Member found in favour of the respondents, and it is the Appeal Panel's view that those findings were not made against the weight of the evidence. 7. In relation to the appellant's submission that the respondents instructed him verbally to proceed without "a full strip back", the Member did not make a finding on this issue. He considered it unnecessary to determine what the parties has said to each other because any such instructions the appellant may have received were not in writing and thus the appellant was not able to rely on them as a defence under s 18F of the HBA. Again, we consider this finding to be correct and it should not be disturbed. Similarly as the Member found, the subsequent email from the respondents to the appellant which included the comment "we had our house painted to be tidied up….", cannot be relied upon by the appellant as a defence to the claim as it had been made after the work had been carried out. 8. Overall in relation to this ground of appeal, we consider that the Member's findings were not made against the weight of the evidence, and nor were they not fair and equitable. Also, to the extent that we allowed the appellant to tender new evidence in the appeal, this evidence was not significant and did not persuade us to disturb the Member's findings. Leave to appeal on this ground is refused. Ground 5 - the appellant's submissions 1. The appellant said that the Tribunal should not have accepted the evidence of the respondents contained in their joint witness statement in relation to a range of issues including whether they had instructed him not to carry out a full strip back. The Tribunal should also not have accepted the evidence of Mr Goodwin in relation to the prevailing weather conditions prior to his inspections and in relation to the results of his moisture metre readings, but should have preferred his evidence in relation to these matters. Ground 5 - the respondents' submissions 1. The respondents said that the Tribunal had correctly accepted their evidence and that of their expert in preference to the evidence of the appellant and that these findings should not be disturbed. Ground 5 - consideration 1. As we have already noted the Member did not need to make, and did not make a finding as to whether the respondents had instructed him not to carry out a full strip back. As to the other instances where he preferred the respondents' evidence and that of their witnesses, the appellant's case is again hampered by the absence of the transcript of the Tribunal proceedings. We were also not provided with the respondents' joint witness statement. In these circumstances there is no material before us which could provide a basis for finding that the Member had fallen into error. 2. We are not satisfied that this ground of appeal has been established and leave to appeal is refused. Ground 6 - the appellant's submissions 1. The appellant pointed out that the respondents had first obtained a quote from another painter, Mr Smaller, before engaging Mr Goodwin. Mr Smaller had said in his report dated 17 August 2021 that: The only way to have this problem fixed correctly is to have all paint removed and (to) start again. My suggestion is to have the house soda blasted to remove the paint which is expensive. An over the phone quote is $15,000 to $20,000. Plus $13,000 for the painting of the house again. 1. Mr Smaller's estimate of the cost of rectification was therefore in the range of $28,000 - $33,000 and, in the appellant's submission, should have taken as the maximum amount payable by him. This amount was considerably less than Mr Goodwin's subsequent estimate of $45,000, the amount claimed in the respondents' Scott Schedule. The appellant referred specifically to the additional item: clean all previous paint spills and splashing to garden surrounds, driveway and path slabs - $2,000, included by Mr Goodwin in his report, and said that this was not fair and equitable that the claimant can make up a sum and demand compensation for this amount. Ground 6 - the respondents' submissions 1. The respondents submitted that Mr Goodwin was well qualified as an expert to express his own opinion on the cost of the required remedial work and that the Tribunal was entitled, as it did, to accept his costings. Ground 6 - consideration 1. Mr Goodwin's costings differed from those of Mr Smaller in two respects. Firstly he added the amount of $2,000 for cleaning the garden surrounds, driveway and path. Secondly, he estimated the cost of the soda blasting to be $28,000, and not $15,000 - $20,000, as Mr Smaller had done. He said that his costings included scraping, sanding and grinding the paintwork to the handrails and balustrading and applying a rust inhibitor to these surfaces. The costing also included erecting scaffolding around the exterior of the premises. Mr Smaller had not included these items in his quote. 2. The Member accepted Mr Goodwin's costings as the basis for awarding the respondents the amount of $45,000. The Decision sets out where and why Mr Goodwin's final figure exceeds the initial quote from Mr Smaller, and we see no basis accepting the appellant's argument that Mr Smaller's quote should be preferred. Again, it does not appear that the appellant questioned Mr Goodwin about his costings during the hearing. 3. The Member also referred in paragraph [6] of the Decision to the following passage in Haines v Bendall [1991] HCA 15, that: "the injured party should receive compensation in a sum which, so far as money can do, will put that party in the same position as he or she would have been in if the contract had been performed", which, subject to the qualification that the method of rectification and its cost must be reasonable: Bellgrove v Eldridge [1954] HCA 36, he said was the fundamental principle to be applied when measuring damages. That paragraph, in our view, correctly states the law. 4. In the circumstances leave to appeal is also refused for this ground. Orders 1. The Appeal Panel makes the following orders: 1. Leave to appeal refused. 2. The appeal is 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: 02 November 2022