Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Peter Graeme Murphy v GT Alliance Pty Ltd [2015] NSWCATCD 74 Hearing dates: 3 June 2015 Decision date: 09 July 2015 Jurisdiction: Consumer and Commercial Division Before: Margaret Mary McCue, General Member Decision: The respondent is to pay the applicant the sum of $ 19,400.00 on or before 16 July 2015 Catchwords: Termination: unsolicited consumer agreement: express rights; effect of termination Australian Consumer Law Legislation Cited: Part 5, Schedule 4, Civil and Administrative Act, 2013; sections 3 (a); 3 (1) A and 7 Consumer Claims Act 1998 ["the Act"] Competition and Consumer Act [Australian Consumer Law- schedule 2] s 28 Fair Trading Act 1987; Section 109 X 1 (a) , Corporations Act, 2001; s 160, Evidence Act 1995, (C'W) and (NSW) Category: Principal judgment Parties: Peter Graeme Murphy (applicant) GT Alliance Pty Ltd (respondent) Representation: Applicants: In person Respondent: No representation File Number(s): GEN 15/29581 Publication restriction: Nil REASONS FOR DECISION Application 1. The applicant seeks to terminate an unsolicited agreement during the "cooling-off" period. 2. The applicant appeared in person. 3. A Notice of Hearing was sent by post to the respondent's registered office, 1/53 Wongara Street, Clayfield QLD on 27 April 2015. The Notice advised the respondent of the hearing date, 3 June 2015. 4. Section 109 X 1 (a) , Corporations Act, 2001, provides that: 5. for the purposes of any law, a document may be served on a company by, inter alia, posting it to the company's registered office. 6. Section 160, Evidence Act 1995, (C'W) provides as follows: 160 Postal articles (1) It is presumed (unless evidence sufficient to raise doubt about the presumption is adduced) that a postal article sent by prepaid post addressed to a person at a specified address in Australia or in an external Territory was received at that address on the fourth working day after having been posted. 1. (NSW) Evidence Act 1995, s 160, mirrors those terms. 2. I am satisfied that the Hearing Notice was deemed served on the respondent's registered office on the fourth (4) business day after the date of posting the Notice. The Notice was not returned to the tribunal. 3. I note that another Notice of hearing was forwarded to an office address in Sydney. That Notice was returned. 4. There was no appearance by any representative of the respondent and the tribunal received no reasons for the respondent's failure to appear before the tribunal. 5. I proceeded to hear the matter. Appearances 1. The applicant appeared in person. 2. The respondent's representative did not appear. 3. Jurisdiction 4. On the establishment date, 1 January 2014, the Civil and Administrative Legislation (Repeal and Amendment) Act 2013 amended certain statutes which previously conferred jurisdiction on now "abolished" tribunals. NCAT has jurisdiction to hear and determine relevant matters in place of the "abolished" tribunals. 5. From 1 January 2014, the Consumer Claims Act was amended. The definition of "Tribunal" was changed in that Act from the CTTT to NCAT - see cl 4.34 item [2] in Schedule 4 to the Civil and Administrative Legislation (Repeal and Amendment) Act. 6. As a result of the amendments, from 1 January 2014, I am satisfied that NCAT has jurisdiction to hear the application made pursuant to the provisions of the Consumer Claims Act 1998. 7. Background 8. Sometime between 3 and 6 March 2015 a representative of the respondent company allegedly telephoned the applicant. 9. During the telephone conversation, the representative enquired whether Mr Murphy had received a brochure that the respondent had been sent to him by mail. Mr Murphy said to the respondent's representative that he might have received the brochure but had not had the opportunity to look at it. 10. As far as Mr Murphy was aware, the officer of the respondent company was telephoning him from the respondent's main office in Sydney. 11. On Tuesday 10 March 2015, Mr Murphy received a further telephone call from Mr Graeme Moores, who identified himself as a representative of the respondent company. The respondent's representative was marketing a software and support package for stock market data. 12. Mr Moores offered Mr Murphy a "business client software package" notwithstanding that Mr Murphy is a natural person rather than a sole trader operating a small business. The price of the software was $ 19,400.00. 13. Mr Murphy decided, as he said: "to go with the offer". He deposited $ 19,400.00 into the respondent's Westpac account on 10 March 2015. 14. Mr Murphy provided evidence of an invoice dated 10 March 2015 confirming the respondent had received the payment of $ 19,400.00. No further money was due and payable pursuant to the terms of the agreement for the supply of the software. 15. Mr Murphy received a letter from G T Alliance dated 10 March 2015 confirming that the GT Alliance business package would provide him with a profit equal to or greater than $ 30,000.00, within the first twelve months of trading. Otherwise, the terms of the agreement provided that: "you would receive a full refund of the purchase." 16. The terms of the refund only applied after completion of twelve months trading based on certain provisions. Further, the applicant was required to apply for any refund [based on non-performance] of the product within 7 days after the expiry of the twelve (12) months from the date of the first trade. 17. The applicant received the software package on 12 March 2015, shortly after the payment was made on 10 March 2015, 18. On 13 March 2015, Mr Murphy telephoned the respondent company and spoke with a Ms Miller seeking some assistance for the installation of the software. 19. Shortly thereafter, Mr Murphy said that he had an opportunity to speak to his daughter who raised some alarm about the respondent's products and performance of the software. 20. On 14 March 2015, Mr Murphy forwarded a letter to Bradley Moores, the Chief Financial Officer of the respondent's company. Mr Murphy said that he wished to terminate the unsolicited agreement. The document was tendered as part of the applicant's evidence and reads as follows: 1. "I Peter Murphy wish to terminate the software package with GT Alliance & Services as per contract agreement with full refund of $19,400.00 paid to GT Alliance on 10 March 2015. 2. This is in regard to our conversation with you on Friday 13 March 2015 regarding our concerns about GT Alliance's software package which has not been installed and will be returned by registered post on Monday 16 March 2015." 1. The applicant submits that he is entitled to a 10 day "cooling off" period in which to terminate an unsolicited agreement for the supply of goods. The applicant says that at the time of entering into the unsolicited agreement, the respondent did not disclose that a 10 day a "cooling off" period applied to the agreement. 2. Mr Murphy returned the software to the respondent's address in Sydney around 16 May 2015. .At the hearing, the applicant tendered an express post envelope addressed to the respondent marked with the words "Return to Sender". Jurisdiction in respect of consumer claims 1. Pursuant to the provisions of section 3 (a) of the Act, the definition of a "consumer" includes a natural person. 2. Pursuant to section 3 (1) A of the Act, "a "consumer claim" includes (a) a claim by a consumer for the payment of a specified sum of money, that arises from a supply of goods or services by a supplier to the consumer, whether under a contract or not, or that arises under a contract that is collateral to a contract for the supply of goods or services. 1. Section 7 of the Act provides that the Tribunal has jurisdiction to hear consumer claims (1) The Tribunal has jurisdiction to hear and determine any consumer claim brought before it under this Part, whether or not the matter to which the claim relates arose before or after the commencement of this Part, except as otherwise provided by this section. (2) Supply or agreement made, or supply intended to be made, in New South Wales The Tribunal has jurisdiction to hear and determine a consumer claim only that includes (c) a contract or other agreement to which the claim relates was made in New South Wales (whether or not the goods or services were supplied in New South Wales). 1. I am satisfied that the applicant is a consumer. Pursuant to section 3 (2) (c) of the Act, the agreement to which the claim relates for the supply of goods and services was one made in New South Wales to which the Act applies, notwithstanding the goods were supplied to a consumer in Victoria. Application of Australian Consumer Law 1. As and from 1 January 2011, pursuant to section 28 Fair Trading Act 1987 (NSW) the Australian Consumer Law, [ACL] as set out in schedule 2 of the Competition and Consumer Act 2010 (Commonwealth) was incorporated into the law of New South Wales. NCAT has jurisdiction to hear consumer claims and to apply the ACL to those claims. 2. A consumer as defined under the ACL has the same meaning as a consumer as defined in the Consumer Claims Act. Pursuant to section 3 (e) ACL "goods" as defined include "software". The goods so supplied must be of a kind ordinarily of for personal, domestic or household use or consumption. 3. Division 2 – ACL deals with provisions relating to unsolicited consumer agreements Subdivision A -- Introduction 69 Meaning of unsolicited consumer agreement (1) An agreement is an unsolicited consumer agreement if: (a) it is for the supply, in trade or commerce, of goods or services to a consumer; and (b) it is made as a result of negotiations between a dealer and the consumer: (i) in each other's presence at a place other than the business or trade premises of the supplier of the goods or services; or (ii) by telephone; whether or not they are the only negotiations that precede the making of the agreement; and (c) the consumer did not invite the dealer to come to that place, or to make a telephone call, for the purposes of entering into negotiations relating to the supply of those goods or services (whether or not the consumer made such an invitation in relation to a different supply); and (d) the total price paid or payable by the consumer under the agreement: (i) is not ascertainable at the time the agreement is made; or (ii) if it is ascertainable at that time--is more than $100 or such other amount prescribed by the regulations. 1. The Act goes onto say that section 70 provides a presumption that agreements are unsolicited consumer agreements (1) In a proceeding relating to a contravention or possible contravention of this Division (other than a criminal proceeding), an agreement is presumed to be an unsolicited consumer agreement if: (a) a party to the proceeding alleges that the agreement is an unsolicited consumer agreement; and (b) no other party to the proceeding proves that the agreement is not an unsolicited consumer agreement. 1. On my view, the consumer is entitled to the presumption available at section 70 (1) ACL. 2. To further consider the application of the ACL, in the context of unsolicited consumer agreements it is necessary to look at the definition of a dealer 3. Section 71 provides as follows: Meaning of dealer A dealer is a person who, in trade or commerce: (a) enters into negotiations with a consumer with a view to making an agreement for the supply of goods or services to the consumer; or (b) calls on, or telephones, a consumer for the purpose of entering into such negotiations; whether or not that person is, or is to be, the supplier of the goods or services. (b) contacted the dealer in connection with an unsuccessful attempt by the dealer to contact the consumer. 1. Section 76 further provides that A dealer must not make an unsolicited consumer agreement with a person unless: (a) before the agreement is made, the person is given information as to the following: (i) the person's right to terminate the agreement during the termination period; (ii) the way in which the person may exercise that right; (iii) such other matters as are prescribed by the regulations; and (b) if the agreement is made in the presence of both the dealer and the person--the person is given the information in writing; and (c) if the agreement is made by telephone--the person is given the information by telephone, and is subsequently given the information in writing; and (d) the form in which, and the way in which, the person is given the information complies with any other requirements prescribed by the regulations. Terms of supply 1. Section 86 provides for a prohibition on supplies etc. for 10 business days (1) The supplier under an unsolicited consumer agreement must not: (a) supply to the consumer under the agreement the goods or services to be supplied under the agreement; or (b) accept any payment, or any other consideration, in connection with those goods or services; or (c) require any payment, or any other consideration, in connection with those goods or services; 1. Clearly the respondent was in breach of the terms of supply within the prohibition period. Subdivision D - Terminating unsolicited consumer agreements 1. Section 82 sets out provisions for terminating an unsolicited consumer agreement during the termination period (1) The consumer under an unsolicited consumer agreement may, during the period provided under subsection (3), terminate the agreement by indicating, in an oral or written notice to the supplier under the agreement, an intention to terminate the agreement. (2) A right of termination under this section may be exercised: (a) despite affirmation of the agreement by the consumer; and (b) even though the agreement has been fully executed. (3) The period during which the consumer may terminate the agreement is whichever of the following periods is the longest: (a) if the agreement was not negotiated by telephone--the period of 10 business days starting at the start of the first business day after the day on which the agreement was made; (b) if the agreement was negotiated by telephone--the period of 10 business days starting at the start of the first business day after the day on which the consumer was given the agreement document relating to the agreement; (c) if one or more of the following were contravened in relation to the agreement: the period of 3 months starting at the start of the first day after the day on which the agreement was made or, if the agreement was negotiated by telephone, the agreement document was given; (d) if one or more of the following were contravened in relation to the agreement: (i) section 76 (informing consumer of termination period); (ii) a provision of Subdivision C (requirements for unsolicited consumer agreements); (iii) section 86 (prohibition on supplies for 10 business days); the period of 6 months starting at the start of the first day after the day on which the agreement was made or, if the agreement was negotiated by telephone, the agreement document was given; (e) such other period as the agreement provides. (4) If the notice under subsection (1) is written, it may be given: (a) by delivering it personally to the supplier; or (b) by delivering it, or sending it by post, in an envelope addressed to the supplier, to the supplier's address referred to in section 79(d)(iv); or (c) if the supplier has an email address--by sending it to the supplier's email address referred to in section 79(d)(v); or (d) if the supplier has a fax number--by faxing it to the supplier's fax number referred to in section 79(d)(vi). (5) A notice under subsection (1) sent by post to a supplier is taken to have been given to the supplier at the time of posting. (6) There are no requirements relating to the form or content of a notice under subsection (1). Effect of termination 1. Section 83 (1) provides that If an unsolicited consumer agreement is terminated in accordance with section 82: (a) the agreement is taken to have been rescinded by mutual consent; and (b) any related contract or instrument is void. (3) The termination of an unsolicited consumer agreement has effect for the purposes of section 82 and this section even if: (a) the supplier under the agreement has not received the notice of termination; or (b) the goods or services supplied under the agreement have been wholly or partly consumed or used. 1. Section 84 sets out the obligations of the supplier on termination If an unsolicited consumer agreement is terminated in accordance with section 82, the supplier under the agreement must, immediately upon being notified of the termination, return or refund to the consumer under the agreement any consideration (or the value of any consideration) that the consumer gave under the agreement or a related contract or instrument 1. Section 85 sets out obligations and rights of consumers on termination (1) If an unsolicited consumer agreement is terminated in accordance with section 82, the consumer under the agreement must, within a reasonable time: (a) return to the supplier under the agreement any goods: (i) that have been received from the supplier under the agreement; and (ii) that the consumer has not already consumed; 1. Section 87 provides for an immediate refund as set out in the following terms where an unsolicited consumer agreement is made (1) If an unsolicited consumer agreement is terminated in accordance with section 82, the supplier under the agreement must immediately refund to the consumer under the agreement any payment: (a) that the consumer, or a person acting on the consumer's behalf, makes to the supplier after the termination; and (b) that purports to be made under the agreement or a related contract or instrument. Summary of findings 1. In the absence of any contrary view, the tribunal may deem a contract an unsolicited consumer agreement to which the ACL applies. The deeming provisions of the Act apply to the agreement the subject of the claim. 2. The consumer may terminate the agreement within specified time periods. 3. The consumer submitted that the respondent had failed to disclose to the applicant that a 10 day "cooling off" period applied to the agreement. 4. The applicant exercised his right to terminate the unsolicited consumer agreement within the 10 day "cooling off" period by giving a written notice of termination to the respondent. 5. I am satisfied that the applicant is a consumer. Upon giving written notice of the termination of the unsolicited agreement during the 10 day "cooling off" period, the deeming provisions of the Act apply even if the consumer has used or consumed the goods or service. The effect of the termination is that the agreement is deemed to be rescinded by mutual agreement. 6. The Tribunal notes that the consumer has attempted to return the goods to the supplier without success. 7. Accordingly, * the contract is deemed to have been rescinded by mutual consent; * the applicant/consumer is entitled to a full refund of monies paid. ORDER 1. The respondent is to pay the applicant the sum of $ 19,400.00 on or before 16 July 2015 Margaret Mary McCue General Member Civil and Administrative Tribunal of New South Wales 9 July 2015 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: 28 August 2015