Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Taylor v Fuller t/as Environmental Systems Architecture [2023] NSWCATCD 157 Hearing dates: 17 November 2023 Date of orders: 28 December 2023 Decision date: 28 December 2023 Jurisdiction: Consumer and Commercial Division Before: G A Kinsey, General Member Decision: The application is dismissed. Catchwords: CONSUMER LAW-consumer guarantee under section 60 of Australian Consumer Law 2010 (NSW)-identity of contracting parties- status of deregistered company-whether architect provided services with due care and skill- terms and conditions of contract-meaning of due care and skill Legislation Cited: Australian Consumer Law 2010 (NSW) Corporations Act 2001 (Cth) Fair Trading Act 1987 (NSW) Cases Cited: John Churchill and Louise Churchill v Troy Paschini trading as Labryinth Gardens [2015] NSWCATCD 73 Let's Go Adventures Pty Ltd v Barrett [2017] NSWCA 243 Liu v Zaccaria trading as Precision Automotive Engineers [2017] NSWCATCD 59 Mayne Nickless Ltd v Crawford (1992) 59 SASR 490 Pethybridge v Stedikas Holdings Pty Ltd [2007] NSWCA 15 Rogers v Whitaker (1992) 175 CLR 479 Voli v Inglewood Shire Council (1963) 110 CLR 74 Texts Cited: None Category: Principal judgment Parties: Duncan Taylor and Shannon Taylor (Applicants) Robert Peter Fuller t/as Environmental Systems Architecture (Respondent) Representation: Duncan Taylor (Applicants) Robert Peter Taylor, self-represented (Respondent) File Number(s): 2023/00373275 (previously GEN 23/44534) Publication restriction: Unrestricted REASONS FOR DECISION Parties 1. The Applicants Duncan and Shannon Taylor engaged the Respondent to provide advice about the redevelopment of sites in Wiley Park and Punchbowl and to prepare development applications for submission to council. For the sake of convenience, the Applicants shall hereinafter be referred to collectively as "the Taylors". At the hearing, Taylor was represented by Duncan Taylor (who shall be referred to as "Duncan"). 2. The Respondent Peter Fuller is a registered architect who conducts business as Environmental Systems Architecture. For the sake of convenience, the Respondent shall hereinafter be referred to as "Fuller". At the hearing, Fuller represented himself. The Application 1. In an application filed in the Tribunal on 3 October 2023, the Taylors sought orders against Fuller for the payment of $38337.73 being a refund of professional fees paid for architectural services including advice and the preparation and lodgement of development applications for properties at Wiley Park and Punchbowl. 2. The Taylors alleged Fuller did not provide his services with due care and skill in breach of the consumer guarantee in section 60 of Australian Consumer Law 2010 (NSW) ("the ACL") and breached his contract. 3. The Taylors claimed they were entitled to a refund of the fees paid to Fuller for his non-compliance with the consumer guarantee in section 60 of the ACL and breaching his contract. In addition to a refund, the Taylors sought reimbursement of fees paid to external consultants. Jurisdiction 1. I find that the claim is a "consumer claim" as defined in section 79E of the Fair Trading Act 1987 ("the FTA"). 2. I find that the Taylors are consumers, Fuller is a supplier and the application is a claim by a consumer that arises from a supply of goods and services by a supplier to a consumer under a contract made in New South Wales. 3. I find that the application was made within the 3 years period from the date on which the cause of action arose (Section 79L(1)(a) of the Fair Trading Act 1987). The amount sought by the Taylors is within the jurisdictional limit of the Tribunal. I find the Tribunal has jurisdiction to hear and determine the application. Procedural Directions 1. The application was listed in a Group List on 19 October 2023 when the Tribunal made procedural directions for the parties to file and serve their documentary evidence. 2. In compliance with the procedural directions both parties filed and served bundles of documents which were tendered and marked as exhibits in the proceedings. 3. At the conclusion of the hearing, the parties were directed to provide an ASIC search for the company Peter Fuller Associates Architects Threshold Issue: Identity of the Contracting Parties 1. In his written submissions, Fuller submitted "Peter Fuller Associates Architects trading as Environmental Systems Architecture was engaged by Duncan Taylor on behalf of Shannon Taylor from 12 July to 11 September 2021 to prepare a brief analysis of opportunities to redevelop sites at…" 2. The threshold issue for determination is to correctly identify the contracting parties. 3. The Taylors asserted the contracts for the services were made with Fuller in his own right and accordingly, he is personally responsible for their loss. 4. Fuller denies the contracts were with him and contends the contracts were with his company Peter Fuller Associates Architects Pty Ltd which has now been deregistered. 5. The ASIC search for Peter Fuller Associates Architects Pty Ltd shows the company was deregistered on 11 July 2021 pursuant to section 601AB of Corporations Act 2001. 6. In John Churchill and Louise Churchill v Troy Paschini trading as Labryinth Gardens [2015] NSWCATCD 73, the Tribunal considered the legal principles applicable to a determination as to the identity of the correct contracting party. 7. The Tribunal referred to the decision in Pethybridge v Stedikas Holdings Pty Ltd [2007] NSWCA 154 and stated at [41]-[42]: The legal principle to be applied is that set out by Campbell JA in the Court of Appeal in Pethybridge at [54]. [54] At the risk of some repetition, I will seek to draw the threads together. Identification of the parties to the contract must be made in accordance with the objective theory of contract: Ryledar Pty Ltd & Anor v Euphoric Pty Ltd [2007] NSWCA 65 at [262]- [266] and cases there cited. It was the Respondent who bore the legal onus of proving that the Appellant was the other party to the contract that had undoubtedly been entered for the performance of the work on the two carparks. It was relevant, for that purpose, to establish who was carrying on business under the name C & D Asphalt Service. That is because the correct conclusion to draw from the objective evidence is that a reasonable observer of the communications that led to the entering of the contract, together with the background facts known to the parties, would conclude that the parties intended that the contract would be with whomever it was that was carrying on business under the name (emphasis added) C & D Asphalt Service. 42. Campbell JA continued in his reasoning in Pethybridge to also examine the effect of tendering the extract from the Business Names Register in the absence of other evidence sufficient to establish who was carrying on the business. [55] It is the effect of section 24 Business Names Act 1962 that, if there had been no other evidence on the topic, tender of the extract from the Business Names Register would have been sufficient to establish that it was the Appellant who was carrying on business under the name C & D Asphalt Service. A principle that can be drawn from Press v Mathers, Re Johnson, Re ABC Plastik and Aikman v Brown is that, once it has been proved who is carrying on business under a particular business name, the evidence leading to that conclusion may overcome the merely prima facie evidence that arises from section 24 Business Names Act 1962. 1. On 11 September 2021 Fuller forwarded a "Proposal for architectural services between architect and client" for the Wiley Park property ("the First Proposal") The architect's name is recorded as "Peter Fuller Associates Architects trading as Environmental Services Architecture". The client's name is shown as Duncan Taylor. The proposal outlines the services to be provided and the fee structure. 2. On 6 June 2022 Fuller submitted a second proposal for the Taylors' consideration ("the Second Proposal"). This proposal related to the Punchbowl property. The architect's name is recorded as "Environmental Systems Architecture". The names of the contracting parties are described as "Peter Fuller Associates Architects Pty Ltd 2495 (NSW) trading as Environmental Systems Architecture" and Duncan Taylor. 3. The Business Names Extract shows the business name "Environmental Systems Architecture" was registered to Robert Peter Fuller. The date of registration was 3 October 2019. 4. The First and Second Proposals forwarded to the Taylors were dated after 11 July 2021, being the date of deregistration of Peter Fuller Associates Architects Pty Ltd 5. What consequences flow from the submission of documents in the name of a deregistered company? Section 601AD of the Corporations Act 2001 provides that a company ceases to exist on deregistration. 6. The test to be applied is that on the objective evidence would a reasonable observer of the communications conclude who were the parties that intended to enter the contract (Pethybridge). 7. Fuller's submission was that he was not a party to the contracts and was not personally liable. He argued that the Taylors engaged "Peter Fuller Associates Architects trading as Environmental Systems Architecture" to undertake the work detailed in the 2 proposals. 8. The Tribunal is not satisfied there is merit in his arguments and rejects the submission. On the objective evidence, a reasonable observer would conclude the parties to the contract were the Taylors and Fuller. 9. Firstly, Fuller allowed the company to be "deregistered as a company and its bank account closed in early 2023 and to cease as a trading company". He knew the company was no longer operating and had taken steps to shut it down. 10. Secondly, after deregistration, he continued to provide the Taylors with proposals in the name of the company even though he was aware the company had ceased to exist. 11. Thirdly, although the invoices for payment were issued in the name of Peter Fuller Associates Architects Pty Ltd, Fuller directed the Taylors to pay the invoiced amounts into the account of RP Fuller. 12. Fourthly, the Business Names Extract confirms Robert Peter Fuller was the registered owner of the name "Environmental Systems Architecture" from 3 October 2019. At the date of the First and Second Proposals, Fuller and not the company, was trading under the business name. 13. The only reasonable conclusion from the objective evidence was that the Taylors was dealing with Fuller in his personal capacity. 14. The Tribunal finds that the parties to the contract were the Taylors and Fuller. The Contract 1. What were the terms and conditions of the contracts? The contracts consisted of the proposals, the NSW ARB Short Form Architect Client Contract 2019 and the Services Schedule. 2. The First Proposal included a document headed "Design Brief" which provided background material and a general description of the objective of the retainer. 3. The Design Brief was: 1. The project is to gain the highest likely rental, and potential end sale value, from redevelopment of the site. 2. Following extensive exploration of the alternative development options a dual occupancy two storey semi-detached building with granny flats in the rear aimed to obtain either Torrens Title of strata titled subdivision has been select(sic) to proceed to development application. 3. The design to allow for intensive large family use. 4. The design to incorporate environmentally sensitive features. 5. Materials selected for construction to be durable and economic. 1. The First Proposal was signed and dated by Fuller on 14 September 2021 and by Duncan on 16 September 2021. 2. Upon acceptance of the First Proposal by Duncan on 16 September 2021, a contract was made between the parties. 3. The Second Proposal was in similar terms to the First Proposal. The wording of the Design Brief was identical except for point 2 which was as follows: 2. Following extensive exploration of alternative development options a 2 x 3 bedroom with study dual occupancy two storey semi-detached building with 2 x 2-bedroom granny flats in the rear aimed to obtain either Torrens Title or strata title subdivision has been select (sic) to proceed to development application. 1. The background material provided in the Second Proposal was different to that in the First Proposal. 2. The Second Proposal was accepted by Duncan on 2 July 2022. The copy of the document in evidence has not been signed by Fuller. 3. Notwithstanding the document is unsigned, The Tribunal finds a contract was made on or about 2 July 2022 between the Taylors and Fuller. 4. The fees payable to Fuller for his services are set out in the Services Schedule attached to each contract. 5. The terms and conditions of the contracts are contained in the ARB Short Form Architect Client Contract. 6. Pursuant to each contract, the evidence establishes the Taylors made payments to Fuller for his services and to various service providers. What were the services to be provided under the contract by Fuller? 1. The Taylors submitted Fuller was engaged to design 2 duplexes with granny flats at the rear to maximise the redevelopment of land he owned at Wiley Park and Punchbowl and prepare development applications. Duncan stated he was very specific in his instructions to Fuller about what he wanted to achieve from the project. 2. Fuller argued the Design Brief outlined the extent of the services to be provided being "…a dual occupancy two storey semi detached building with granny flats in the rear aimed to obtain Torrens Title or strata title subdivision.." He submitted there was no reference to land subdivision. 3. Fuller asserted he "was engaged to make a development application for a "Dual Occupancy Development proposal"" for the Wiley Park and Punchbowl sites. He contended the "architectural work and the work of the specialist consultants agreed and paid by Duncan Taylor met the requirements of the architectural brief." 4. He claimed the development application lodged with the Canterbury Council would have been approved if the Taylors had paid the lodgement fees. 5. I find the services to be provided by Fuller are set out in the Services Schedule which forms part of the NSW ARB Short Form Architect Contract 2019. 6. Under the headings "Services and Fees" and "Stages of Service", there is a description of the services to be provided by Fuller which are: 1. Design Brief and preliminary sketches; 2. Detailed analysis of development controls; 3. Measured drawings (after Covid 19 access); 4. Concept design and sign off; 5. Design development; 6. Development application submission 1. The estimated cost for Wiley Park was $12,000.00 and for Punchbowl $13750.00. Did Fuller provide his services with due care and skill? 1. Section 60 of the ACL is in the following terms: Guarantee as to due care and skill If a person supplies in trade or commerce, services to a consumer, there is a guarantee that the services will be rendered with due care and skill. 1. The phrase "due care and skill" in section 60 of the ACL is equivalent to the common law duty to take reasonable care: Let's Go Adventures Pty Ltd v Barrett [2017] NSWCA 243 at [6] (Basten and Gleeson JJA). Therefore, the consumer guarantee that services be provided with due care and skill that is implied into consumer contracts is a guarantee that the services will be performed in a "careful, skilful, and workmanlike" manner. However, the test is an objective test (Mayne Nickless Ltd v Crawford (1992) 59 SASR 490; Read v Nerey Nominees Pty Ltd [1979] VicRp 6; [1979] VR 47 at 49; S.G. Corones The Australian Consumer Law (2011) Lawbook Co pp 361-362), and all of the facts and circumstances must be considered in the context of the application of an objective standard of due care and skill: see for instance Liu v Zaccaria trading as Precision Automotive Engineers [2017] NSWCATCD 59 from [71]. 2. For the purposes of section 60, the question of whether there has been a failure to carry out the services with due care and skill is not one to be considered in the abstract, but in the context of the contractual terms agreed by the parties. The standard required under the contract, or by the ACL, is not perfection: RG Concrete & Polish Pty Ltd v Smart (Civil Claims) [2019] VCAT 722 at [55]. 3. The obligation pursuant to section 60 is also akin to the term implied by the common law in a contract for the supply of services that the supplier will exercise reasonable or due care in skill in the provision of those services: Voli v Inglewood Shire Council (1963) 110 CLR 74 at 85. 4. The scope of the duty of care at common law is objective and based on what is expected of the reasonable person or service provider. The care and skill required of a professional will be objectively assessed by the standards and procedures adopted in the relevant field: Rogers v Whitaker (1992) 175 CLR 479. 5. The Taylors bear the onus of proof and must prove their case on the balance of probabilities. The evidence must be sufficient to satisfy the Tribunal that it should make the orders sought in the application. 6. The Taylors rely primarily on the Expert Report of Robert Nigel Dickson dated 18 October 2023 ("the Expert Report"). Dickson is a registered architect and town planner with approximately 30 years' experience. The Tribunal is satisfied he is qualified to express the opinions in the Expert Report. 7. Dickson reviewed the Design Briefs for the Wiley Park and Punchbowl properties and Proposal for the provision of architectural services. 8. He reviewed the First Proposal (Wiley Park). He noted the Proposal covered the scope of services, the preliminary budget, fee assessment and disbursements. 9. Dickson also reviewed the Second Proposal which had a similar service description to the First Proposal. The main difference between the proposals was the location of the site. 10. The brief involved a review of restrictions on development. Both sites were subject to planning controls of Canterbury Council which were available on Council's website. 11. Dickson reviewed the Development Application reports for both sites, architectural drawings, statement of cost of works for each application, planning certificates for each site, traffic report and owner's consent to lodge the DA. 12. Dickson reviewed the letter from George Teleo, a Town Planner with Canterbury Council in respect of DA-376/2023-15 The Mall, Wiley Park. Relevantly the letter stated: I note that the new application proposes a dual occupancy dwelling with an FSR of roughly 0.35:1, seemingly to allow for secondary dwellings. Upon a detailed assessment of the site, you would be unable to erect secondary dwellings as you require a minimum of 450sqm to allow for a secondary dwelling as per Oart 1 of Chapter 3, 53 (2a) of the State Enviromental Planning Policy (Housing) 2021…………. Alternatively, you might wish to resubmit amended plans with a larger footprint or amended design with this application if you wish, as the application has not been notified yet. 1. His observations in the Expert Report were as follows: 1. The review of the planning controls for the sites overlooked an important matter for each site being the satisfaction of the minimum lot size for each site. The planning reports did not address this fact for each site. In his opinion "This is a clear omission which is fundamental for commencing an architectural service for a site." 1. The brief included a requirement for the project "to gain the highest likely rental and potential end sale value from the redevelopment of the site." In Dickson's opinion, it is unusual for an architect to refer to the financial return of the project. On the material provided by Taylor, he could find no evidence of communication on the merit of the options considered and the financial returns. He considered tis a major departure from the service offered by Fuller. 1. Fuller disputed the observations in the Expert Report. He asserted Dickson was not provided with 9 preliminary sketches and associated likely potential returns analysed on a comparative basis, not rental projections. Copies of the preliminary sketches are in Fuller's bundle together with an email to Duncan Taylor dated 14 September 2021. 2. Relevantly the email states: "It would be best to have the properties Torrens Title with the driveway (Council only allow a single footpath crossing) having Rights of Way in favour of each property. If that proves too difficult we probably can get Strata Title. The subdivision is a separate issue after the building is complete." 1. Fuller contended he advised Duncan on 10 February 2022 to review the documents and provide his comments. Duncan did not respond to this request. 2. In an email to Fuller on 5 July 2023, Duncan stated: I paid you $6000 for a "detailed analysis of development controls" but you were negligent in this stage of your duty as an architect and overlooked "Part 1 of Chapter 3, 53 (2a) of the State Enviromental Planning Policy (Housing) 2021" (as detailed below in George Telo, CBC town planner's email dated May 16th 2023.) The oversight meant we pursued a design which was never going to be approved, as it failed a most basic assessment of land size (in that neither property was over 900 sqm therefore a secondary dwelling would never be allowed) All work beyond this point was a waste of time. 1. In determining whether services were provided with due care and skill, it is relevant to consider whether there is evidence that a reasonable provider of equivalent services would have done things differently. This is because the Tribunal has to be satisfied that, objectively, the work was not performed with due care and skill (see, e.g. Deacon v National Strategic Constructions Pty Ltd; National Strategic Constructions Pty Ltd v Deacon [2017] NSWCATAP 185 at [46]; Duran and Duran v Tafra Pty Ltd [2015] NSWCATCD 110 at [39]). 2. The Expert Report is a key document in determining if there has been a breach of section 60 of the ACL. Dickson's report is based on the documents provided by the Taylors. Importantly, he says he reviewed the Design Brief which set out the Proposal for architectural services, scope of services, preliminary budget fee assessment and disbursements, the Development Application and the email from George Telo dated 16 May 2023. 3. Fuller disputed the observations made by Dickson. In his response, he highlighted deficiencies in the report which he argued, cast doubt on Dickson's observations. 4. The Expert Report makes no reference to the emails, preliminary sketches, minutes or notes of meetings between Duncan and Fuller included in Fuller's bundle. 5. From a review of Fuller's documents, it is evident there were meetings and emails between the parties at regular intervals. As Dickson did not refer to this material in his report, it is reasonable to assume he was not provided with all relevant documentation as suggested by Fuller. Dickson was not in possession of all relevant material. This failure significantly diminishes the weight the Tribunal gives to the Expert Report. 6. In his Expert Report, Dickson makes 2 observations which were challenged by Fuller. The first observation made by Dickson alleged Fuller did not satisfy himself about the minimum lot size for each site. 7. Fuller answered this observation by referring to 12 emails between 2 August 2021 and 12 September 2022 wherein he dealt with the issue of the lot sizes and the intention to subdivide the sites by strata title. It is not clear from the Expert Report if Dickson was provided with copies of those emails, but extracts are included in Fuller's bundle of documents. Those emails cast considerable doubt on Dickson's conclusion that Fuller overlooked the minimum lot size requirements for each site. 8. The second observation made by Dickson relates to the financial return for the project. Dickson stated in his report he could "find no evidence of communication on the merit of the options considered and financial return". 9. In answer to this observation, Fuller provided copies of emails between 12 July 2021 to 14 September 2021, Meeting Notes and preliminary sketches. 10. The reasonable conclusion is the Taylors did not provide Dickson with copies of all relevant material to enable him to express an informed opinion. 11. The Design Brief required Fuller to prepare Development Applications for each site "aimed to obtain either Torrens Title of strata titled subdivision has been select(sic) to proceed to development application." 12. In determining whether Fuller provided his services with due care and skill, it is relevant to consider whether there is any evidence that a reasonable provider of equivalent services would have done things differently. There is no evidence from Dickson how he would have done things differently to Fuller. The Tribunal must be satisfied that, objectively, the services provided by Fuller were not performed with due care and skill. 13. The letter from George Telo is not a rejection of the development applications. Rather, it is an invitation to submit an amended application. Fuller argued the amended application submitted to Council would have been approved upon payment of the required fee. There is no evidence to support that submission. 14. The Tribunal is not satisfied the Taylors have proved their case on the balance of probabilities. When the evidence is looked at objectively, the Tribunal is satisfied Fuller provided his architectural services in a "careful, skilful, and workmanlike" manner. Accordingly, the Tribunal is not satisfied the Taylors have proved Fuller breached the consumer guarantee implied by Section 60 of the ACL. Were the services reasonably fit for purpose? 1. Section 61 (1) of the ACL provides: If: (a) a person (the supplier) supplies, in trade or commerce, services to a consumer; and (b) the consumer, expressly or by implication, makes known to the supplier any particular purpose for which the services are being acquired by the consumer; there is a guarantee that the services, and any product resulting from the services, will be reasonably fit for that purpose. (2) If: (a) a person (the supplier) supplies, in trade or commerce, services to a consumer; and (b) the consumer makes known, expressly or by implication, to: (i) the supplier; or (ii) a person by whom any prior negotiations or arrangements in relation to the acquisition of the services were conducted or made; the result that the consumer wishes the services to achieve; there is a guarantee that the services, and any product resulting from the services, will be of such a nature, and quality, state or condition, that they might reasonably be expected to achieve that result. 1. Section 61(4) of the ACL provides: (4) This section does not apply to a supply of services of a professional nature by a qualified architect or engineer. 1. As Fuller is a qualified architect, section 61 does not apply to the supply of architectural services by him. Breach of Contract Claim 1. The Tribunal considered whether Fuller breached the contract with the Taylors. 2. Having considered the evidence, the Tribunal finds the Taylors have not proved any breach of contract by Fuller. Conclusion 1. The Taylors have not proved their case against Fuller on the civil standard and accordingly, the application 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: 05 August 2024