Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Sinclair v Taree City Car Sales Pty Ltd [2023] NSWCATAP 45 Hearing dates: On the Papers Date of orders: 20 February 2023 Decision date: 20 February 2023 Jurisdiction: Appeal Panel Before: L Wilson, Senior Member A Lo Surdo SC, Senior Member Decision: (1) Leave to appeal is granted. (2) The appeal is allowed. (3) The Orders of the Tribunal in MV22/26574 dated 27 October 2022 are set aside. (4) Order the Respondent to pay to the Appellant the sum of $2,973.00 on or before 22 February 2023. Catchwords: EVIDENCE - whether the Tribunal mischaracterised the nature of the expert evidence – whether the decision of the Tribunal was against the weight of the evidence APPEALS – whether leave to appeal should be granted – whether the appellant has suffered a substantial miscarriage of justice Legislation Cited: Australian Consumer Law, being Schedule 2 of the Competition and Consumer Act, 2010 (Cth) Civil and Administrative Tribunal Act, 2013 (NSW) Motor Dealers and Repairers Act, 2013 (NSW) Cases Cited: Collins v Urban [2014] NSWCATAP 17 Medtel Pty Ltd v Courtney (2003) 130 FCR 182 Merck Sharp & Dohme (Aust) Pty Ltd v Peterson (2011) 196 FCR 145 Ryan v BKB Motor Vehicle Repairs Pty Ltd [2017] NSWCATAP 39 Secretary, Department of Family and Community Services v Smith [2017] NSWCA 206 Texts Cited: None cited Category: Principal judgment Parties: Annika Joy Sinclair (Appellant) Taree City Car Sales Pty Ltd (Respondent) Representation: Appellant (Self Represented) File Number(s): 2022/00346098 Publication restriction: Nil Decision under appeal Court or tribunal: Civil and Administrative Tribunal Jurisdiction: Consumer & Commercial Division Citation: N/A Date of Decision: 27 October 2022 Before: S Hausfield, General Member File Number(s): MV 22/26574 REASONS FOR DECISION Background 1. On 16 December 2021, Annika Joy Sinclair ("the Appellant") purchased a blue 2013 Holden Barina motor vehicle, registration CL 16 AD with 91,501 kilometres on the odometer from Taree City Car Sales Pty limited (the Respondent) for a purchase price of $8,000 inclusive of stamp duty and other on road costs ("the Vehicle"). 2. The Vehicle came with a statutory warranty of 3 months or 5,000 kms (Motor Dealers and Repairers Act, 2013, s 69(5)). 3. Shortly after its purchase, the Appellant noticed vibrations when the Vehicle was being driven and, on 27 January 2022, had the Vehicle inspected by Autopro Taree which provided her with an oral assessment that the Vehicle was fine. 4. The vibrations persisted and on 13 May 2022, during the course of a routine service by Jax Tyres and Auto, Taree, issues were identified with the Vehicle comprising a suspected "chemi weld" in the cooling system, vibration in the engine with possible internal damage and timing belts possibly due for replacement ("Jax Report"). 5. On 23 May 2022, the Appellant obtained a report on the Vehicle from Mr Simon Paterson, Owner/Mechanic of Coastal Automotive Repairs, Forster ("Coastal Automotive Report"). Upon inspection of the Vehicle, Mr Paterson found that all engine mounts were worn out, cracked and sagged causing the engine to vibrate. The inspection also revealed oil build-up in the cooling system caused by oil leaking into that system. 6. Photos of the worn and cracked engine mounts and the oil leaking into the cooling system were attached to the report. Mr Paterson opined that, "all issues relating to the [Vehicle] are pre-existing issues and occurred prior to the customer purchasing the car from the car yard in 2021…the [Vehicle] should not have been sold to the customer in the condition that it is in." The cost of repairs were assessed at $2,973. 7. On 29 August 2022, the Appellant obtained a further inspection report on the Vehicle from Joe's Auto Service Centre ("Joe's Auto Report"). Amongst other things, that report also identified issues including oil mixing with the coolant and the engine mount causing vibration in the Vehicle. It noted that it was "unknown how long the faults have existed." That report provides no assessment of the likely cost of repairs. 8. The Appellant seeks to adduce fresh evidence on the hearing of the appeal being a quote, dated 30 August 2022, from Joe's Auto Service Centre evidencing the cost to repair the issues identified in its earlier report. That report was available at the time of the hearing before the Tribunal but for reasons that have not been explained was not tendered in evidence. We address this issue further in these reasons. Tribunal proceedings and reasons for decision 1. The proceedings were heard on 27 October 2022. 2. The Tribunal dismissed the application because, having considered the material placed before it, the Tribunal was not satisfied (at the civil standard of proof) that the grounds required to make the orders had been established. 3. In particular, whilst the Tribunal accepted that the authors of the various expert reports relied upon by the Appellant had relevant expertise to make them, the Tribunal found that there was no expert evidence which identified that the faults existed at the time of the purchase and no expert evidence that they rendered the Vehicle not of acceptable quality for an 8 year old second hand vehicle selling for just $8,000. Scope and nature of internal appeals 1. An appeal to the Appeal Panel does not simply provide a losing party in the Tribunal below with the opportunity to run their case again (Ryan v BKB Motor Vehicle Repairs Pty Ltd [2017] NSWCATAP 39 at [10]). To succeed in an appeal, the appellant must demonstrate either an error on a question of law, which, except in an appeal from an interlocutory decision, may be argued as of right; or that permission (that is, "leave") to appeal should be granted to bring the appeal: Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act), s 80(2). 2. The principles governing an application for leave to appeal under the NCAT Act are well-established and are repeated in many decisions of the Appeal Panel, often quoting Collins v Urban [2014] NSWCATAP 17. They are the same principles applied by the courts. It is enough as a summary to refer to the Secretary, Department of Family and Community Services v Smith [2017] NSWCA 206, where the Court said at [28] (citations omitted): Only if the decision is attended with sufficient doubt to warrant its reconsideration on appeal will leave be granted. Ordinarily, it is only appropriate to grant leave where there is an issue of principle, a question of general public importance, or an injustice which is reasonably clear, in the sense of going beyond what is merely arguable. It is well established that it is not sufficient merely to show that the trial judge was arguably wrong. 1. Where the appeal is from a decision made in the Consumer and Commercial Division (other than in respect of interlocutory decisions), there is a further qualification to the possible grant of leave in that we may only go on to consider a grant of leave in the broader sense if we are first satisfied that the elements of cl 12(1) of Sch 4 of the NCAT Act are made out, in 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. We agree with the Appeal Panel in Collins v Urban where it said, at [76], that a substantial miscarriage of justice for the purposes of cl 12(1) of Sch 4 of the NCAT Act may have been suffered where: ... [T]here 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. The Grounds of Appeal 1. By Notice of Appeal, filed 17 November 2022, the Appellant challenges the decision of the Tribunal on various grounds including that it was against the weight of the evidence. 2. In particular, the Appellant contends that the Tribunal failed to have regard or give due weight to the expert evidence that she relied upon, including the Coastal Automotive Report which opined that the issues observed with the Vehicle were pre-existing at the time that the Vehicle was sold and that it should not have been sold in that condition. 3. Having regard to the decision we have reached, the other grounds of appeal are otiose and we do not propose to address them. Consideration 1. The Tribunal dismissed the proceedings because it found that the Appellant had failed to satisfy the Tribunal on the available evidence that grounds existed justifying the orders sought. 2. In reaching this conclusion, the Tribunal found that none of the expert evidence relied upon by the Appellant identified the faults observed with the Vehicle existed at the time of the purchase on 15 December 2021 and that those faults rendered the Vehicle not of acceptable quality for an 8 year old second-hand vehicle selling for just $8,000. 3. The Appellant relied upon three written experts' reports: the Jax Report, the Coastal Automotive Report; and the Joe's Auto Report. 4. The Jax Report identified a number of issues with the Vehicle including "suspected chemi weld in the cooling system, vibration in engine with possible internal damage and timing belts possibly due (for replacement)". 5. The Coastal Report identified that the engine mounts were "… worn out, cracked and sagged causing engine to vibrate on body of car, which is what the customer had complained of" and that "...engine oil [was] leaking into the cooling system…" It opined that "…all issues relating to the [Vehicle] were pre-existing issues and occurred prior to the customer purchasing the car from the car yard in 2021…[and] the [Vehicle] should not have been sold to the customer in the condition that it is in." The report includes photos depicting the cracked engine mounts and oil in the cooling system. The Coastal Report contains a quote to repair these issues at $2,973.00. 6. Joe's Auto Report identified a number of issues with the Vehicle including the "head gasket leaking oil & mixing with coolant" and "engine mount causing vibration through vehicle." The report, however, specifically notes that "unknow (sic) how long the faults have existed." 7. We are of the opinion that the Tribunal erred in characterising all of the expert evidence as failing to address that the faults in issue existed at the time of the purchase of the Vehicle and that there was no expert evidence that the Vehicle was not of acceptable quality for an 8 year old second-hand vehicle selling for just $8,000. 8. Whilst this characterisation of the expert evidence was undoubtedly correct in respect of both the Jax and Joe's Auto reports, the same cannot be said for the Coastal Report. That report, contrary to the findings of the Tribunal, opines that both the engine vibration and engine oil leaking into the cooling system were pre-existing issues which occurred prior to the Appellant purchasing the Vehicle in December 2021. Further, the Coastal Report opines that the Vehicle should not have been sold to the Appellant in its condition. 9. Section 54 of the Australian Consumer Law ("ACL") which is set out in Schedule 2 of the Competition and Consumer Act, 2010, provides a statutory guarantee that goods supplied to a consumer, other than in relation to auctioned goods, are of acceptable quality. Goods are of "acceptable quality" if they are as fit for the purposes for which they are commonly supplied, free from defects, of acceptable appearance and finish, and as safe and durable as a reasonable consumer fully acquainted with their condition would regard as acceptable (ACL, s 54(2)). 10. In determining whether a reasonable consumer would regard goods as being of acceptable quality, section 54(3) requires the nature and price of the goods, statements made on labels and packaging, any representations made about the goods by the manufacturer or supplier and other relevant circumstances to be taken into consideration. Whether or not those factors are satisfied is an objective test (Merck Sharp & Dohme (Aust) Pty Ltd v Peterson (2011) 196 FCR 145). 11. The time at which the determination of whether goods are of acceptable quality is when the goods are supplied to the consumer (Medtel Pty Ltd v Courtney (2003) 130 FCR 182). 12. We are of the view that the expert opinion expressed in the Coastal Report establishes, contrary to the findings of the Tribunal that first, the faults identified in that report were in existence at the time that the Vehicle was sold and secondly, that the Vehicle should not have been sold in that condition. It was open to the Tribunal to infer from the Coastal Report that the Vehicle was not of acceptable quality at the time that it was sold and should not have been sold in that condition. 13. The expert evidence indicates that the faults are capable of repair at a cost of $2,973.00. The faults are therefore of a kind that can be remedied easily and within a reasonable time the Vehicle can be made fit for the purpose for which it was intended. In those circumstances, we do not consider the faults to comprise a major failure as defined in s 260 of the ACL justifying the rejection of the Vehicle and a refund of the purchase price. 14. In selling the Vehicle in the condition that it did, the Respondent breached s 54 of the ACL. The appropriate remedy is to refund to the Appellant the amount of $2,973.00 of the purchase price representing the cost to repair the identified faults. 15. For the reasons outlined, we would grant leave to appeal under s 80(2) and cl 12(1) of Sch 4 of the NCAT Act as the Appellant may have suffered a substantial miscarriage of justice in circumstances where, as we have found, the decision of the Tribunal under appeal was against the weight of evidence. 16. One final matter. The Appellant sought leave to rely upon a document that was not before the Tribunal being a quotation from Joe's Auto dated, 30 August 2022, addressing the costs to repair a number of issues with the Vehicle including but not limited to the engine vibration and the presence of oil in the coolant. 17. Whist we may permit fresh evidence or evidence in addition to that received by the Tribunal at first instance, we are not inclined to do so in circumstances where the document now sought to be relied upon was clearly in existence at the time of the Tribunal hearing and the Appellant has provided no reason or explanation as to why the document was not tendered in evidence at the hearing. 18. Further, and in any event, we do not consider that document to be relevant or to affect the probable outcome of the appeal as it addresses the cost of repair of defects other than those identified in the Joe's Auto Report and the Joes Auto Report is, as the Tribunal found and we agree, of no probative value. Orders 1. Our Orders are as follows: 1. Leave to appeal is granted. 2. The appeal is allowed. 3. The Orders of the Tribunal in MV22/26574 dated 27 October 2022 are set aside. 4. Order that the Respondent pay to the Appellant the sum of $2,973.00 on or before 22 February 2023. ********** 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: 20 February 2023