Fair Trading Tribunal New South Wales CITATION: Basham v Fair Trading Administration Corporation [2000] NSWFTT 11 DIVISION: Home Building Division PARTIES: APPLICANT: Mr Basham RESPONDENT: Fair Trading Administration Corporation FILE NUMBER: BU 1999/5434 HEARING DATES: 23 March 2000 (Case Conference) SUBMISSIONS CLOSED: 14/04/2000 DATE OF DECISION: 18/05/2000 BEFORE: I McDonell Deputy Chairperson LEGISLATION CITED : Home Building Act 1989 Fair Trading Tribunal Act 1998 CASES CITED: Nil CATCHWORDS: Insurance claim declined - major structural defect alleged - claim declined - appeal lodged out of time - no jurisdiction MATTER FOR DECISION: Appeal against decline of insurance claim APPLICANT: REPRESENTATION: Mr K Carmody RESPONDENT: Mr C Pacey ORDERS: 1. Application of Mr Basham filed 17th September 1999 be dismissed. Reasons for Decision: Short facts 1 Mr Basham employed a builder P A Kuster Pty Ltd to erect a house at lot ... , Young in 1992. Over the intervening years, the owner noticed cracking in the walls of the building. 2 In early 1998, Mr Basham decided to make a claim against the builder for rectification of the defects. He discovered that the builder was no longer resident in the area and could not be located. A report from a structural engineer was commissioned. Based on the report of Mr Simpson of June 1998, Mr Basham considered the damage to the dwelling to be a major structural defect. Classified as such, the defect could be the subject of an insurance claim for a period of up to seven years after construction. 3 Fair Trading Administration Corporation investigated the claim and declined to indemnify the owner. The refusal by the Fair Trading Administration Corporation was issued by the department on 28th of July 1999. The notice gave two grounds of refusal, both relating to late notification by the homeowner. 4 Home owner/Applicant, Mr Basham, commenced an action in the Fair Trading Tribunal seeking a review of the refusal of an insurance claim by the Fair Trading Administration Corporation. The claim was lodged on the 17th September 1999. Issues 5 The substantive argument by the Homeowner is that the defects constituted major structural defects. As such, the Corporation is obliged to indemnify the homeowner. 6 The Corporation filed a respondent's Notice of Issues on the 25th of February 2000. In such document, the Corporation stated that section 86 of the Home Building Act 1989 provides time limits within which an appeal against a decision of the Corporation must be lodged. The notice refusing the claim was dated 28th July 1999. 7 In the opinion of the Corporation, an appeal ought to have been lodged by 30 August 1999. Section 86(3) of the Home Building Act provides that an appeal may be lodged with the leave of the Tribunal. Such leave must be sought by application to the Tribunal of within 30 days of the initial period provided in section 86 (1) of the Act. 8 The matter came before the Fair Trading Tribunal at a case conference on the 23rd March 2000. At the case conference, the Corporation raised the issue of the failure off the homeowner to seek leave of the Tribunal within the prescribed time. 9 The parties were directed to file written submissions. Homeowner's argument 10 The Homeowner's argument as to the jurisdiction of the Tribunal to entertain the appeal is argued in relation to time limits and the power of the Tribunal to extend time. 11 In particular, reference is made to Section 29(3) of the Fair Trading Tribunal Act which provides that "the failure to comply is to be treated as an irregularity and does not nullify the proceedings unless the Tribunal otherwise orders". 12 It was also argued that under section 27(6) of the Fair Trading Tribunal Act, the Tribunal has power to extend time limits for anything done under the Act. 13 It is further argued by the Homeowner that there is no prejudice to the Corporation and further that the legislation is beneficial in favor of homeowners. Corporation's argument 14 The Corporation submits that section 27 of the Fair Trading Tribunal Act 1998 cannot act to extend time for appeal under the Home Building Act. The Corporation argues that the time limitations in the Home Building Act cannot be extended by the Fair Trading Tribunal Act. The reference in section 27 in the Fair Trading Tribunal Act, is a pal, which only extends to the operation of matters to be done under the Fair Trading Tribunal Act. 15 At Point 5 of its submission dated the 13th of April 2000, the Corporation say that the Homeowner filed an appeal outside the prescribed time. 16 Further, leave to appeal was not sought until 3rd April 2000. See paragraph 6 of the owner's submission 3 April 2000. Findings 17 The power for the Tribunal to review a decision of the Fair Trading Administration Corporation primarily arises from amendments to the Home Building Act, found in Part 5 of the Act. 18 The power to extend the time for filing is found in the Home Building Act section 86(3). The Fair Trading Tribunal Act does not, in this case, operate so as to modify the explicit provisions of the Home Building Act. 19 The Fair Trading Tribunal Act does not, in particular, empower the Tribunal to modify the strict terms of s86 of the Home Building Act. There is no other mechanism available to the Tribunal to allow in an "out-of-time" application. 20 This being so, the failure of the Homeowner to file within the time limits set by the Home Building Act is fatal. Under neither Act is there a mechanism to extend the time for filing beyond the period reserved. 21 Therefore the Fair Trading Tribunal is deprived of jurisdiction to determine the appeal against the decision of the Fair Trading Administration Corporation and the application must be dismissed. Orders 1. Application of Mr Basham filed 17th September 1999 be dismissed. …………………….. Ian McDonell Deputy Chairperson Fair Trading Tribunal I HEREBY CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF THE FAIR TRADING TRIBUNAL. 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.