Civil and Administrative Tribunal New South Wales Medium Neutral Citation: GMK Developing Services Pty Ltd v Curcio [2015] NSWCATAP 115 Hearing dates: 20 March 2015 Date of orders: 18 June 2015 Decision date: 18 June 2015 Jurisdiction: Appeal Panel Before: Mr M Chesterman, Principal Member Mr R Titterton, Senior Member Decision: Leave to appeal refused. Appeal dismissed Legislation Cited: Civil and Administrative Tribunal Act 2013 Cases Cited: Collins v Urban [2014] NSWCATAP 17 Pholi v Wearne [2014] NSWCATAP 78 Category: Principal judgment Parties: GMK Developing Services Pty Ltd (Appellant) Mr Francesco Curcio and Mrs Leah Curcio (Respondents) Representation: Mr G Sussman, director of the Appellant, for the Appellant Mr F Curcio for the Respondents File Number(s): AP 14 /54044 Decision under appeal Court or tribunal: Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Date of Decision: 7 October 2014 Before: J Bordon, Senior Member File Number(s): HB 13/45042, HB 13/48456 REASONS for decision 1. In this matter the appellant GMK Developing Services Pty seeks leave to appeal from a decision of the Consumer and Commercial Division of the Tribunal (the Tribunal) of 7 October 2014. The Tribunal ordered the appellant, a builder (and to which we will refer to as "the builder" in these reasons), to pay the respondents, Mr and Mrs Curcio (to whom we will refer as the homeowners), the sum of $5,086,00. 2. For the reasons that follow we consider that leave to appeal should be refused and the appeal otherwise dismissed. Background 1. The Tribunal heard two proceedings together. The first was proceedings HB 13/45042, in which the builder sought to recover an amount claimed as due from the homeowners under a contract to carry out residential building work. At the hearing the parties agreed that the amount due was $4,473,80. The second proceedings were proceedings HB 13/48054 in which the homeowners sought orders for "replacement/rectification and/or compensation" for the costs of rectification of defective works. At the hearing the homeowners asked the Tribunal for a money order rather an order requiring the builder to rectify the defects. The Tribunal ordered the homeowners to pay the builder $9,559.00 less the amount of $4,473.82, with the result that the builder was to pay the homeowners the net amount of $5,086.00. In addition the Tribunal ordered the builder to rectify 16 identified defects. Grounds of Appeal 1. Mr Sussman is a director of the builder. He prepared the notice of appeal and appeared at the appeal hearing. He disputed the orders requiring rectification being items 7.2, 7.4, 7.12 and 7.14 of the Scott Schedule. 2. Item 7.2 was the Weathertex cladding of the premises. Mr Sussman described this at the hearing as his "main area of concern". Rather than rectification following the recommendations of the homeowner's expert Mr Beard, Mr Sussman submitted that what was required was additional sealant to be applied where the cracks were evidence to perimeter edges, and for the repainting of the affected area. 3. Item 7.4 was garage brickwork. Mr Sussman submitted that as the homeowners took early possession of the premises, the builder could not reasonably be expected to clean the brickwork without damaging the homeowners' belongings. 4. Item 7.12 was glass balustrading. Rather than rectification following the recommendations of Mr Beard, Mr Sussman submitted that what was required was for a carpenter to supply and install deep joist blocking to the underside of the deck to allow for more adequate bottom fixing. 5. Item 7.14 was internal painting. Rather than rectification following the recommendations of Mr Beard, Mr Sussman submitted that what was required was for a painter to "run back" and make good the affected areas only. Reply to Appeal 1. In their Reply to Appeal the homeowners disputed each of the builder's submissions, supported the original orders made by the Tribunal and submitted that the builder was having an unjustified "second go at a hearing". Leave to Appeal – Principles to be Applied 1. The Civil and Administrative Tribunal Act 2013 (the Act) sets out the basis upon which appeals from decisions of the Consumer and Commercial Division may arise under s 80 of the Act. That section states that an appeal may be made as of right on any question of law or with leave of the Appeal Panel on any other grounds (s 80(2)(b)). 2. Schedule 4, clause 12 of the Act says that an Appeal Panel may grant leave only if the appeal panel is satisfied the appellant may have suffered a substantial miscarriage of justice because: 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 note that in Collins v Urban [2014] NSWCATAP 17 the meaning of "substantial miscarriage of justice" was summarized at [71] and [79] as follows: [71]. . . [I]t can be seen that the concept of a substantial miscarriage of justice refers to a failure in the way a matter was conducted or decided which deprived the appellant of a chance that was fairly open of achieving a better outcome than occurred. . . . [79] In order to show that a party has been deprived of a "significant possibility" or a "chance which was fairly open" of achieving a different and more favourable result . . . it will be generally be necessary for the party to explain what its case would have been and show that it was fairly arguable. If the party fails to do this, even if there has been a denial of procedural fairness, the Appeal Panel may conclude that it is not satisfied that any substantial miscarriage of justice may have occurred." 1. The principles to be applied by an Appeal Panel in determining whether or not leave to appeal should be granted are well settled. In Collins v Urban [2014] NSWCATAP 17 an Appeal Panel of the Tribunal conducted a review of the relevant cases at [65]-[79]. The general principles derived from these cases can be summarised as follows: (1) In order to be granted leave to appeal, the applicant must demonstrate something more than that the primary decision maker was arguably wrong in the conclusion arrived at or that there was a bona fide challenge to an issue of fact: BHP Billiton Ltd v Dunning [2013] NSWCA 421 at [19] and the authorities cited there, Nakad v Commissioner of Police, NSW Police Force [2014] NSWCATAP 10 at [45]; (2) 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. However, as was explained in Pholi v Wearne [2014] NSWCATAP 78 at [32]: Even if the appellant establishes that [they] may have suffered a substantial miscarriage of justice in the sense explained above, the Appeal Panel then retains the discretion whether to grant leave under s 80(2) of the Act (see Collins v Urban, supra at [80]-[84]). [The appellant] must demonstrate something more than that the Tribunal was arguably wrong. Leave is ordinarily granted only where the matter involves an issue of principle, questions of public importance, where the injustice is reasonably clear or where the Tribunal has gone about its fact finding process in such an unorthodox manner that it is likely to have produced an unfair result. 1. In the notice of appeal, Mr Sussman stated that the decision of the Tribunal amounted to a substantial injustice, the decision being against the weight of the evidence. However, this argument is not developed in any way in the notice of appeal, save for identifying the expert evidence relied on by each party at the hearing below. For the builder, the evidence relied on below consisted of a report of Bullivant & Associates of 13 November 2013 (the Bullivant Report); a letter of Boardwalk Exterior Linings (Boardwalk) dated 14 November 2013 (addressed to "To Whom It May concern", and an email from Boardwalk, together with two pages from the Weathertex Installation Manual. Only the Bullivant Report and the Boardwalk correspondence were included in the builder's appeal documents. 2. In addition, the builder seeks to rely on a letter from Mr Conal O'Neill of Weathertex dated 16 January 2015 addressed to "Dear Customer". Mr O'Neill is the Technical manager of Weathertex. That report was obtained after the conclusion of the hearing and after the filing of the notice of appeal. It refers to an inspection of the subject property on 23 December 2014. No reason has been advanced as to why this new evidence is significant and why it was not reasonably available at the time of the hearing of the proceedings under appeal (see Sch 4, cl 12(1)(c) of the Act), or why it should received or read on appeal. Accordingly we have no regard to the contents of that letter. 3. For the homeowners the expert evidence was the expert report of a Mr Beard of Core Project Consulting Pty Ltd dated 14 October 2013 (the Beard Report). That report has not been included in the appeal documents by either party. 4. Both the Bullivant Report and the Beard Report were expressly referred to by the Tribunal in its reasons. The Tribunal noted that each expert was impressive, not only in their demonstrated expertise but also in their "manifest adherence" to the Tribunal's Code of conduct (see reasons at [4]). 5. In relation to item 7.2 the Tribunal expressly referred to each expert report. The Tribunal accepted that the defects were as described by Mr Beared and his method of rectification, which he described as "comprehensive". 6. In relation to item 7.4 the Tribunal did not expressly refer to this item or the competing expert evidence in its reasons. The item is however referred to in the orders made, namely that this item, along with many others, was to be rectified by agreement between the two experts (see reasons at [23]). We note however that during the course of the hearing Mr Sussman accepted that this item was "not a major thing". 7. In relation to item 7.12, liability was accepted by the builder. The Tribunal accepted Mr Beard's opinion and costings. No express reference was made to the Bullivant report. 8. In relation to item 7.14 liability was again admitted. But there was a dispute between Mr Bullivant and Mr Beard as to the amount of labour and cost of the rectification work required. The Tribunal accepted Mr Beard's opinions, noting his specialist expertise in the field of painting. 9. Having reached those conclusions, the Tribunal noted that the homeowners were adamant that a money order should be made, principally as the builder's expert had agreed that rectification was required to most of the items. Nevertheless, the Tribunal considered that the builder should be given the opportunity to rectify the defects. The Tribunal noted that the homeowners would have the opportunity of renewing the proceedings if there was non-compliance by the builder. The Tribunal expressly noted at [24] that, where it had indicated that it preferred the estimates of quantum proposed by Mr Beard, the rectification work should address all the detail reported and reflect the degree of attention implied by the scope and the estimates. The Tribunal stated that this was particularly so with the painting (item 7.14). Consideration 1. We have considered the grounds of appeal advanced by the appellant together with his submissions. We do not consider that appellant has raised an issue of principle, or a question of public importance or matters of administration or policy which might have general application. Nor do we consider that the builder has established an injustice which is reasonably clear, that the Tribunal made a factual error that was unreasonably arrived at or clearly mistaken, or that the Tribunal went about its 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. 2. In the circumstances the application for leave to appeal should be refused, and the appeal dismissed. Costs 1. In addition to the grounds of appeal stated above, the Tribunal ordered the builder to pay the homeowners the costs of Mr Beard's report and attendances and $220 for engineering advice. Mr Sussman says it is not reasonable or fair for the builder to pay these costs as, in relation to some of the items in dispute, the builder had been successful. 2. Some 21 items were in dispute. After a "hot tub" of the experts, 16 items remained contested. All were the subject of rectification orders; two (items 7.9 and 7.10) rectified in accordance with the method described in the Bullivant Report, five (items 7.2, 7.5, 7.12, 7.13 and 7.14) in accordance with Mr Beard's recommendations, and the remaining nine items (items 7.1, 7.3, 7.4, 7.6, 7.7, 7.8, 7.11, 7.15 and 7.21) rectified as agreed by the two experts. 3. We do not agree that the builder had been successful in relation to some of the items. Of the 16 items remaining in dispute after the "hot tub", all were ordered to be rectified in some way, and the reasons record at [6] that 124 items were agreed as requiring further works. 4. Accordingly, we see no reason to disturb the Tribunal's order in respect of the costs of Mr Beard's reports, attendances and advice. Orders 1. The Appeal Panel makes the following orders: 1. The application for leave to appeal is dismissed. 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: 18 June 2015