Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Ross v New South Wales Land and Housing Corporation [2016] NSWCATAP 150 Hearing dates: 17 June 2016 Date of orders: 17 June 2016 Decision date: 17 June 2016 Jurisdiction: Appeal Panel Before: P Durack SC, Senior Member DAC Robertson, Senior Member Decision: 1. The time for the Appellant to lodge the appeal is extended to 1 April 2016. 2. Allow the appeal. 3. Set aside orders 1 and 2 made on 7 December 2015. 4. Remit the whole of the case to be determined by a differently constituted Tribunal with liberty to the parties to adduce further evidence. Catchwords: APPEAL- termination of residential tenancy – unlawful use of premises by drug taking – not the basis advanced at hearing – Tribunal relied upon inferences not raised at the hearing drawn from admissions by tenant advocate and tenant not directed at unlawful use of premises - denial of procedural fairness - findings not open on the information before the Tribunal - errors of law. Legislation Cited: Civil and Administrative Tribunal Act 2013 Residential Tenancies Act 2010 Residential Tenancies and Housing Legislation Amendment (Public Housing - Antisocial Behaviour) Act 2015 Cases Cited: Briginshaw v Briginshaw (1938) 60 CLR 336 Claydon v NSW Land & Housing Corporation [2015] NSWCATAP 192 Frost v Kourouche (2014) NSWLR 214 Grizonic v Suttor [2011] NSWSC 471 Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22 Kioa v West (1985) 159 CLR 550 Kostas v HIA Insurance Services Pty Ltd [2010] HCA 32, (2010) 241 CLR 390 Minister for Immigration and Multicultural Affairs; ex parte Miah (2001) 206 CLR 57 Muin v Refugee Review Tribunal (2002) 76 ALJR 966 Prendergast v Western Murray Irrigation [2014] NSWCATAP 69 SHH Ltd v Woodorth Plumbing Services Pty Ltd [2014] NSWCATAP 46 Warkworth Mining Limited v Bulga Milbrodale Progress Association Inc [2014] NSWCA 105 Category: Principal judgment Parties: Kristy Maree-Ross (Appellant) New South Wales Land and Housing Corporation (Respondent) Representation: Counsel: D M Bampton (Appellent) K Madgwick (Respondent) File Number(s): AP 16/15781 Decision under appeal Court or tribunal: Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Citation: Nil Date of Decision: 7 December 2015 Before: J Levingston, General Member File Number(s): SH 15/50718 REASONS FOR DECISION 1. In this matter the Appellant appealed against orders made on 7 December 2015 terminating a residential tenancy agreement between the Appellant and the Respondent pursuant to s91(1)(b) of the Residential Tenancies Act 2010 (NSW) (RTA) on the basis that the Appellant had "intentionally or recklessly caused or permitted the use of the premises for any other unlawful purpose". 2. On 17 June 2016, after hearing argument on the appeal that day on the primary matters relied upon by the Appellant, all of which concerned findings relating to the Appellant's use of the premises for taking drugs, the Appeal Panel decided to allow the appeal and to set aside the orders made by the Tribunal at first instance. We indicated that reasons for the decision would follow. These are our reasons. Extension of time 1. The Notice of Appeal was filed on 1 April 2016. Pursuant to Rule 25(4)(b) of the Civil and Administrative Tribunal Rules 2014 (NSW) an appeal against a decision made in "residential proceedings" (which pursuant to Rule 3(1) includes proceedings under the RTA) must be commenced within 14 days "from the day on which the Appellant was notified of the decision or given reasons for the decision (whichever is the later)". 2. In support of an application for an extension of time in which to file the appeal pursuant to s41 of the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act) the Appellant tendered two statutory declarations. 3. The first statutory declaration was affirmed by the Appellant herself. In that declaration the Appellant explained that she had been homeless since the hearing below and had been sleeping on friends' lounges, even "a few parks". The Appellant also stated that she had travelled to Tamworth where her children were staying with her mother but that she had not stayed there long and had returned to the Central Coast and had been staying on couches with friends. The Appellant stated that she contacted the tenants' service, that is the South West Sydney Tenants' Advice and Advocacy Service which had represented her at the initial hearing, around 21 March 2016 "because I was due to come back to Campbelltown for Local Court". The Appellant stated that she was then told of the orders the Tribunal had made and that she could appeal if she wished. The appeal was filed within two weeks from that date. 4. The second statutory declaration was affirmed by Ms Nicole Kennedy who had represented the Appellant at the initial hearing. Ms Kennedy stated: "The decision was emailed to our service on 18 December 2015 and attempts were made to contact [the Appellant] through all known avenues. They were ultimately unsuccessful. We next heard from [the Appellant] on 21 March 2016 where she phoned our service to let us know she was coming back to Campbelltown for a Local Court hearing date". 1. We note that Ms Bampton, who appeared for the Appellant, submitted that the appeal had been filed within time as the evidence disclosed that the Appellant had only been notified of the decision on 21 March 2016, with the result that the appeal was therefore filed within 14 days of notification. We will address this argument as well as the application for an extension of time later in these reasons. Utility of the appeal 1. It was common ground, as the Tribunal found, that the Appellant had ceased to reside in the premises prior to the hearing at first instance as a result of a fire at the premises. As set out in the Appellant's statutory declaration referred to above, the Appellant had not resided in the premises since that time. 2. At the commencement of the hearing, the Appeal Panel raised with the parties the question of whether there was any utility in the appeal as an order reinstating the tenancy would be ineffective. Ms Bampton acknowledged that, as the premises were uninhabitable, the Respondent would be entitled at any time to serve a notice terminating the tenancy (pursuant to s109 of the RTA). However, it was common ground between the parties that the premises were being repaired, although there was no agreement as to when those repairs might be completed. Ms Bampton submitted that it was not certain that the Respondent would serve a notice and that as long as the tenancy remained on foot, the Appellant would have the opportunity to return to the premises when they were repaired. Ms Madgwick informed us that service of a notice was clearly a possible outcome. 3. Ms Bampton also pointed out that one of the outcomes of the decision below and the termination of the tenancy pursuant to s91(1)(b) of the RTA is that the Appellant has been identified as an unsatisfactory former social housing tenant with the result that she has not been able to access any form of social housing, including emergency housing, and that status would remain unless the decision were set aside. 4. Given that future occupation of the premises by the Appellant remains, at least, a real prospect and, also, because a successful appeal will impact on the Appellant's classification for the purposes of social housing, in our opinion, the appeal is not without utility. We have therefore proceeded to determine the appeal. The Applicable Law 1. A further preliminary point raised at the hearing was that the proceedings below were determined before the commencement of operation of the Residential Tenancies and Housing Legislation Amendment (Public Housing -Antisocial Behaviour) Act 2015 on 18 December 2015. There are no transitional provisions in the RTA or in the amending Act. It was common ground between the parties that the legislation governing the determination of the appeal, and any re-hearing were the matter to be remitted, would be the RTA as it stood before 18 December 2015. The Decision below 1. In paragraph 4 of the Decision the Member set out what were the "material facts" as follows: 1. Prior to March 2015 the tenant Ms Ross was residing in social housing premises on the Central Cost of NSW with her partner Mr Segal, and had two young children aged about two and five years, and was encouraged by Mr Segal's mother to move closer to her as she had offered to help Ms Ross look after the children. Ms Ross applied for and was granted social housing premises at Ambarvale; 2. On 27/3/15 the parties made a residential tenancy agreement for premises at Ambarvale consisting of three bedroom town house (the Premises) for a fixed term of five years at a rent of $250.00 per week (the Agreement); 3. The Agreement is in the standard form of RTR [Residential Tenancies Regulations] Schedule 1 and sets out the rights and obligations of the tenant; 4. Ms Ross had previously suffered a personal injury and received monies, and although the amount was not stated there was evidence of a sum of about $20,000, of which part was used to buy the motorcycles, but there was no evidence of how much, if any, of this amount remains; 5. On 7/8/15 Campbelltown Police had cause to attend the Premises to make enquiries of Ms Ross about one of her children being absent from school for about 9 days, and whilst attending the Premise they observed some motorcycles inside the Premises and conducted a search with consent and after consent was withdrawn took Ms Ross with them to Campbelltown Police Station, obtained a search warrant before returning to the Premises to continue the search. During the searches the following items were found on the Premises: two motorcycles stolen from St Andrews and Blacktown respectively; an unlicensed and shortened shotgun found hidden under the stairs, which was subsequently tested and fired (thus establishing it to be a fire-arm): Exhibit B; a drill which was later identified as having been stolen from the Central Coast; and knuckle dusters (said to belong to Mr Segal); 6. Ms Ross' children were removed and now live with Ms Ross' parents at Tamworth; 7. Since these events, the Premises were deliberately set on fire by a person or persons unknown; 8. The tenant is no longer residing in the Premises as they are currently uninhabitable; 9. Ms Ross informed the Tribunal that she had been taking illegal drugs at the Premises, but "had been clean" for the last 15 days. 1. The detail of an expert ballistics report relied upon by the Respondent was not outlined in the reasons. It identified that the shotgun (a shortened 12 gauge Riverside Arms Company double barrel shotgun) had been received as an exhibit in a disassembled state and with a missing fore end. It had been tested for firing by fitting a substitute fore end. It was found to be capable of firing from the left barrel only. The expert expressed the opinion that because of its shortened dimensions it was a prohibited firearm. 2. The Member identified that the landlord relied upon s91(1)(b) of the RTA. Section 91(1) and (2) provides: (1) The Tribunal may, on application by a landlord, make a termination order if it is satisfied that the tenant, or any person who although not a tenant is occupying or jointly occupying the residential premises, has intentionally or recklessly caused or permitted: (a) the use of the residential premises or any property adjoining or adjacent to the premises (including any property that is available for use by the tenant in common with others) for the purposes of the manufacture, sale, cultivation or supply of any prohibited drug within the meaning of the Drug Misuse and Trafficking Act 1985, or (b) the use of the residential premises for any other unlawful purpose and that the use is sufficient to justify the termination. (2) In considering whether to make a termination order on the ground specified in subsection (1) (b), the Tribunal may consider (but is not limited to considering) the following: (a) the nature of the unlawful use, (b) any previous unlawful uses, (c) the previous history of the tenancy. 1. One of the reasons for termination stated by the respondent in its application lodged in the Tribunal was "Police also located sealed plastic bags containing Cannabis". At the hearing Mr Fensom, who appeared for the landlord, explicitly stated that he was not pressing the part of the application which referred to "plastic bags containing cannabis". Mr Fensom stated "I'm actually looking for a termination under 91(1)(b), not 1(a) but 1(b)". The Member asked "So we don't need to worry about the drug paraphernalia?". Mr Fensom responded "No": transcript at page 29 line 4.. 2. In considering whether the landlord had established that the Appellant had used the premises for an unlawful purpose the Member stated at paragraph 7: "There are several groups of conduct involving an unlawful purpose. First, the intentional conduct of Ms Ross who has, by her own admission at the hearing, been taking illegal drugs up until 15 days ago. This is sufficient for RTA s91(1)(b)." 1. The Member recorded that the evidence was that Mr Segal owned the shotgun and that the evidence suggested that the shotgun, stolen drill and stolen motorcycles had been brought onto the premises by Mr Segal. 2. The Member recorded a submission on behalf of the Appellant that the Appellant could not be responsible for Mr Segal's conduct. The Member stated in paragraph 9 of his reasons for decision: "However Ms Ross has permitted Mr Segal access to the Premises and to store stolen goods there, and the shotgun. She says she had no knowledge of the shotgun which only addresses the intentional element, but not the reckless element. … In this matter Ms Ross has been reckless about the conduct of Mr Segal and could have prevented him bringing any goods, including the shotgun, to the Premises. It does not matter that she did not ask Mr Segal about something wrapped up and placed under the stairs, or about the source of the stolen goods. Ms Ross was reckless and it is enough that she permitted Mr Segal to store stolen goods and the shotgun on the premises. She made no enquiry of Mr Segal, which means that she did not care what he did." 1. The Member stated that where unlawful conduct involves conduct other than prohibited drugs, termination is subject to the Tribunal's discretion and that s91(2) provides that the Tribunal may consider the following: 1. The nature of the unlawful use; 2. Previous unlawful uses; 3. The previous history of the tenancy. 1. The Member gave consideration to each of these matters, stating in paragraphs 12 and 13: "12. The unlawful use of the Premises involves unlawful drugs, albeit not for the last 15 days, and storage of stolen goods. There was no evidence of any previous unlawful use at these Premises prior to August 2015, and there was no evidence concerning the previous history of this tenancy or any previous tenancy involving Ms Ross. She is entitled to a presumption of good character. 13. There are other matters to be considered. The evidence is that whilst living at Ambarvale Ms Ross has engaged in taking illegal drugs, but since it has become impossible to live at the Premises since destruction by fire, she has in the last 15 days ceased to take illegal drugs. The question is the connection between drug taking and the Premises. It would not be too remote to assume that her previous dealers in that area know of her addiction and the Ambarvale address and if she is to return to the Premises, it is more likely than not, in human experience, that she will be subjected to dealer pressure to return to her previous addiction. To break this cycle by removing Ms Ross from this risk is a relevant consideration. In addition, Ms Ross' children are now living in Tamworth and it is in her interests to move closer to them in the hope that eventually she will be re-assessed by DOCS as able to care for them." 1. The Member then turned to consider the matters referred to in s152 of the RTA as it then stood (s152 was repealed by the Residential Tenancies and Housing Legislation Amendment (Public Housing - Antisocial Behaviour) Act). In paragraph 16, in addressing whether the tenancy has serious adverse effects on neighbouring residents or other persons, the Member stated: "The evidence is of illegal drug use, stolen goods and the shotgun. These are all matters which have a serious adverse effect on the neighbouring residents." 1. With respect to the question whether the breach of the agreement was a serious one and whether, given the behaviour or likely behaviour of the tenant, a failure to terminate the agreement would subject or continue to subject neighbouring residents or any persons or property to unreasonable risk, the Member stated in paragraph 17: "I am satisfied on the evidence of this matter that all the above breaches of the Agreement are serious, and a failure to terminate the tenancy will, or will continue to subject, neighbouring residents to unreasonable risk. There are two arms to the relevant behaviours in (b): behaviour or likely behaviour. I understand these to raise the issue of past behaviour and future or 'likely' behaviour. I am satisfied that the tenant's behaviour in the past was a serious breach of the Agreement. Having made this finding, it is not necessary to consider the likely or future behaviour of the tenant." 1. With respect to the landlord's responsibility to its other tenants, and having referred to other tenants' rights to quiet enjoyment, the Member stated, in paragraph 19: "I am satisfied on the evidence that Ms Ross' conduct places the landlord in breach of its obligations to its other tenants in neighbouring premises." 1. The Member concluded in paragraphs 22 and 23: "22. I am satisfied on the evidence before me that (a) the premises are residential premises to which the RTA applied; (b) the s91(1) conduct complained of is proven by the evidence summarised in the facts above and exhibits. 23. I am also satisfied that the order for termination should be made and should take effect immediately." 1. It can be seen from these reasons that the Tribunal's findings about taking illegal drugs at the premises and the connection between this and drug dealers supplying the Appellant at the premises were part of the bases of the decision to terminate the tenancy. Grounds of Appeal 1. The Notice of Appeal alleged error of law, that the decision was not fair and equitable and was against the weight of evidence, and that there was significant new evidence available which was not reasonably available at the time of the hearing below. 2. The questions of law identified by the Appellant were that the Tribunal made findings of fact unsupported by evidence, denied the Appellant procedural fairness, erred in failing to take into account relevant considerations and erred in taking into account irrelevant considerations. 3. At the forefront of the Appellant's submissions was the proposition that, in finding that the taking of illegal drugs took place at the premises in question, that the Appellant and her address were known to drug dealers in the area of the premises and that there have been serious adverse effects on neighbouring residents, the Tribunal acted without evidence and in breach of the rules of procedural fairness. 4. Additional issues raised by the Appellant, some of which required leave to appeal, included : 1. The Member failed to address evidence which may have suggested that the Appellant did make enquiries about the source of the motorcycles and thought they had been acquired through Gumtree (an online auction site). 2. The conclusion that it was reckless not to enquire about "something wrapped up and placed under the stairs or about the source of the stolen goods" was unjustified. 3. The only evidence about serious adverse affects on neighbours favoured the Appellant. 4. The Member did not address the submission that the Appellant had a clean history so far as breaches of the tenancy was concerned. 5. The weight of the material before the Tribunal was against a decision to terminate when one excludes issues about use of the premises for illegal drug taking and takes account of factors such as that the shotgun was very old, disassembled, missing a part and found under a stairwell wrapped in a pillow case. 6. There was significant new evidence, said to be that the police had now dropped all but one charge against the Appellant for possession of stolen goods. We comment here that the evidence about this was difficult to interpret. 1. It was unnecessary for us to determine these additional issues because of the opinion we formed about errors in relation to the findings concerning unlawful use of the premises for taking drugs, which we address below. 2. Because of the emphasis given by the Appellant to contentions of error in relation to the matters concerning drugs, the merits of those contentions, the time constraints of the hearing, and the desirability of ruling upon the appeal as expeditiously as possible, we heard argument upon those contentions and arrived at our decision without hearing from the Respondent about these additional issues. Extension of time 1. Before turning to address the issues upon which we determined that the appeal should succeed, it is necessary that we consider the application for an extension of time. 2. As noted above, Rule 25(4)(b) of the Civil and Administrative Tribunal Rules requires that an appeal against a decision in a residential tenancy matter must be brought within 14 days of the Appellant being notified of the decision. The evidence of the Appellant was that the application was brought within 14 days of her becoming aware of the decision, as she did not become aware of it until 21 March 2016, although her representatives at the South West Sydney Tenants Advice and Advocacy Service had been made aware of it on 18 December 2015. 3. As we have determined that an extension of time should be granted in the exercise of our discretion, we do not need to determine whether the Appellant is correct in suggesting that the relevant date for the purposes of Rule 24(4)(b) was 21 March 2016 when she personally received notification of the decision below. 4. Nevertheless, the point was argued and we, briefly, deal with it. The tenant's advocate who appeared at first instance was not at that time an admitted solicitor. In those circumstances, the usual rule that notice to a solicitor is notice to the client (Grizonic v Suttor [2011] NSWSC 471 at [25]) is not applicable. However, the basis for the usual rule is that the solicitor has been appointed the agent of the client for the purposes of the proceedings, including for the purpose of receiving notice of the decision. In circumstances where the Appellant had appointed the Tenants Advisory Service to represent her in the proceedings and notice had been given to that service, in our opinion, the Appellant received notice at the time the decision was provided to her representatives. To conclude otherwise could cause unwarranted inconvenience and potential unfairness to the successful party at first instance. 5. The delay in commencing the appeal is substantial. Not without justification, Ms Madgwick, who appeared for the Respondent, submitted that the evidence did not demonstrate that the Appellant had had proper concern to discover the outcome of the proceedings. Ms Madgwick submitted that the evidence suggested that the Appellant had simply stood by and allowed time to pass, that she had not actively been seeking to get in contact or find out what had happened and that she had simply abandoned her rights. 6. Ms Bampton submitted that in the period with which we are concerned the Appellant was dealing with extreme circumstances. She had been subjected to significant destabilising forces in her life. She did not inhabit a stable world in which she might be expected to exercise the inquisitiveness concerning the outcome of the result that might generally be expected of tenants subject to termination proceedings. It was not a case of the Appellant simply not being interested in her rights. 7. Overall, in our opinion, a refusal of an extension of time would work an injustice upon the Appellant: Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22 at [21] and [40]. In this regard, we have not only taken account of the substantial merit of the appeal, but also that an explanation on oath has been provided and is not without substance. It is also important to bear in mind that the premises were not available for immediate occupancy. If they had been, the Appellant would have had greater cause for interest in the outcome at first instance. From the Respondent's perspective, the uninhabitable state of the premises meant that it could not point to any substantial prejudice. The prejudice referred to in Jackson (at [28]), consisting of the ability to provide accommodation to others, does not arise and was, correctly, not relied upon by the Respondent. Merits of the appeal 1. We now turn to consider the issues relating to the findings of the Tribunal Member concerning the use of drugs by the Appellant at the premises. 2. Ms Bampton submitted that those findings involved an error of law both because of an absence of evidence to support them and because the Tribunal had not disclosed the possibility that it would make such findings and had not given the Appellant the opportunity to be heard in opposition to them. 3. Making a finding without evidence to support it and failing to accord procedural fairness are both errors of law which may ground an internal appeal pursuant to s80(2)(b) of the NCAT Act against a decision of the Tribunal without leave of the Appeal Panel (Prendergast v Western Murray Irrigation [2014] NSWCATAP 69 at [13]). (a) Procedural fairness 1. As we have already noted, the Respondent expressly withdrew reliance on the drugs found at the premises. Its case of unlawfulness was based upon permitting use of the premises for the storage of the unlicensed firearm, the stolen motorcycles and the drill. 2. At no stage in the proceedings at first instance did the Respondent contend that taking drugs at the premises was part of the unlawful use of the premises, that drug dealers were supplying the Appellant at the premises, and that this gave rise to serious adverse affects on neighbours. The Tribunal did not raise with the parties that any such findings might be made. 3. The findings arose from what the Tribunal saw as the Appellant's admission of illegal drug taking at the premises: paragraphs 6 and 7 of the reasons. In the context of addressing below the Appellant's no evidence argument about this subject, we examine the material at the hearing about this. 4. For present purposes, it suffices to note that : 1. It is apparent that the Tribunal's reference to an admission must be founded upon various statements made by the Appellant's advocate and by the Appellant herself during the course of the hearing (although not in the course of her giving evidence because she chose not to give evidence). We set out the content of these statements when dealing with the Appellant's no evidence argument. 2. Such statements as there were on this subject from the Appellant's advocate and from the Appellant were not directed to any issue of illegal drug taking at the premises. They were directed to the issue as to how the Tribunal should exercise the discretion in relation to termination. In essence, it was the Appellant's submission that termination would likely result in her reversion to drug use. 3. The statements were unclear about the use of the premises for illegal drug taking. 4. The statements did not cause the Respondent to modify its case of unlawful use of the premises and to submit that the unlawful use now extended to illegal drug taking at the premises. 1. On the issue of a denial of procedural fairness, the Appellant relied upon the decision of an Appeal Panel of this Tribunal in SHH Ltd v Woodorth Plumbing Services Pty Ltd [2014] NSWCATAP 46 at [19], where it was said: [19] It is well established that it is a denial of procedural fairness, and thus an error of law, to determine a claim on a basis that was not in issue or argued in proceedings. In Warkworth Mining Limited v Bulga Milbrodale Progress Association Inc [2014] NSWCA 105 at [40] and [41] Bathurst CJ said: There will be procedural unfairness where information is used by a decision maker in a way that could not reasonably be expected by one party and that party is not given an opportunity to respond to that use… Another aspect of procedural fairness was argued in the present case, namely, that where a court determines a matter on a basis that was not in issue or argued in the proceedings, there will have been a denial of procedural fairness: …. This is a basic requirement for a fair trial. 1. As Mason J stated in Kioa v West at 587 (cited in Warkworth Mining at [35]): "…recent decisions illustrate the importance which the law attaches to the need to bring to a person's attention the critical issue or factor on which the administrative decision is likely to turn so that he may have an opportunity of dealing with it." 1. The Appellant also relied upon the provisions of the NCAT Act concerning the rules of natural justice and the requirement that the Tribunal ensure that the parties have a reasonable opportunity to be heard: s38(2) and (5)(c). 2. The Respondent submitted that Kioa v West could be distinguished in this case as, pursuant to s91(1)(b), the Tribunal was required to look at a broad range of issues and the comments made by the Appellant and her advocate regarding her drug use were being put forward, in the context of an application for termination pursuant to s91(1)(b), as a reason why the unlawful use of the premises relied upon by the landlord, that is the stolen goods and firearms charges, should not lead to termination. The Respondent submitted that the drug use was one part of a larger whole and it was not unfair of the Tribunal to rely upon that as part of the context in which it determined to terminate the tenancy. 3. The Respondent relied upon the decision in Frost v Kourouche (2014) NSWLR 214 in which the Court of Appeal, in considering an appeal from a Review Panel carrying out a medical assessment under the Motor Accidents Compensation Act, stated: [35] There is a well-established line of authority for a complementary proposition to that in Kioa referred to above to the effect that critical facts need to be drawn to the claimant's attention. The complementary proposition is that it is not necessary, in order to discharge the obligation to accord procedural fairness, to go further. [36] In Minister for Immigration and Citizenship v SZGUR [2011] HCA 1 ; 241 CLR 594 at [9], French CJ and Kiefel J said (emphasis added): Procedural fairness requires a decision-maker to identify for the person affected any critical issue not apparent from the nature of the decision or the terms of the statutory power. The decision-maker must also advise of any adverse conclusion which would not obviously be open on the known material. However, a decision-maker is not otherwise required to expose his or her thought processes or provisional views for comment before making the decision. [37] The distinction drawn in that passage reflects what was said by a unanimous Full Federal Court in Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576 at 592, which had in turn been endorsed by a unanimous High Court in SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63 ; 228 CLR 152 at [29]. The same distinction was applied in this court in Victims Compensation Fund Corporation v Nguyen [2001] NSWCA 264 ; 52 NSWLR 213 at [40]. 1. The Respondent submitted that it was a conclusion "obviously open" to the Member that the Appellant had been using drugs on the premises and that that was a further unlawful use of the premises. 2. We disagree with the Respondent's submissions. 3. In our opinion, there was procedural unfairness in both of the ways identified by the Court of Appeal in Warkworth Mining. 4. We have already referred to the importance of the findings concerning the taking of drugs at the premises to the decision to terminate. In our opinion, it was a basic requirement of a fair hearing that the Appellant be notified that these were issues in the case against her and given an opportunity to be heard about them. That entailed an opportunity to rebut the inferences that might be drawn and address the significance of any adverse conclusions. 5. Given the gravity and significance of the issue of unlawful use, the Appellant was entitled to expect that she would be notified of the use to be relied upon, the evidence in support of such use, and of any changes in this regard. In the absence of notice of a change, she was entitled to assume that the case against her remained as notified. 6. Furthermore, in our opinion, the matters referred to in paragraph 46 above themselves meant that the Appellant could not reasonably have expected the information supplied through the statements made by her advocate and herself to have been used by the Member in the way that they were. 7. The respondent did not submit that any such denial of procedural fairness was or should be regarded as inconsequential to the outcome. We have already remarked upon the significance of the drug issues in the reasoning of the Tribunal at first instance. We understood Ms Madgwick to accept that if we found there had been a denial of procedural fairness in relation to the findings concerning drug taking that would be sufficient reason for the decision to be set aside. In our opinion, it was correct and proper of her to do so. (b) Findings relating to use of the premises for drug taking not open on the material 1. In support of the submission that there was no evidence before the Tribunal to support its findings in relation to the taking of drugs at the premises, the Appellant pointed to the fact that the Appellant had not given evidence below and that the material on which the Tribunal had relied consisted of a limited number of statements made either by the Appellant's advocate or by the Appellant herself in the course of the hearing. 2. The Appellant identified from the transcript nine references to drugs which we set out below: T-5:17 "Kristy has been clean for about 15 days now." [Advocate] T-5:37 "Being homeless, she'll be less likely to be able to maintain herself as being clean." [Advocate] T-47:40-45 "In terms of her life in general she has – since moving to Pegler Way its been a bit of a disaster for her. She has become a drug addict since moving to Pegler Way … now she's about 15 days clean." [Advocate] T-51:26 "It will mean that she is unlikely to remain clean while living on the streets…" [Advocate] T-52:20 "She is still in the recovery phase of her drug addiction. Fifteen days…"[Advocate[ T-53:15 "I can't live with my kids until I'm clean… [Appellant from the bar table] T-54:30 "Do you know how hard it is to stay off drugs?... [Appellant from the bar table] T-54:41 "They are, but given the history that she was terminated from Housing, that she has had a drug problem…" [Advocate] T-58:7-13 "So perhaps Kristy should have been a bit better protected from the drugs happening from some of the other premises…" [Advocate] 1. It is necessary to note that in the last statement the Appellant's advocate was referring to evidence given by Police that they had been called to other premises in the street. The passage immediately preceding the last passage set out above was a statement by her advocate that "Kristy's premises is not the premises in that problematic street that the Police had been called to." 2. The Appellant submitted that what were effectively interjections by the Appellant during the course of submissions and submissions made on the Appellant's behalf by her tenant's advocate could not be relied upon as evidence. 3. In response, the Respondent pointed out that the Tribunal is not bound by the rules of evidence and, pursuant to s38(2) of the NCAT Act, may inquire into and inform itself on any matter in such manner as it thinks fit "subject to the rules of natural justice". The Respondent submitted that the Tribunal was entitled to take into account concessions made, whether intended or otherwise, by the Appellant and her advocate. In the Respondent's submission the Appellant was seeking to utilise that information to her benefit and cannot complain if it is utilised to her detriment. 4. To the extent that the evidence did consist of admissions by the Appellant or on her behalf, and in her presence, by her advocate, we consider that the Respondent is correct and the Tribunal was entitled to take that information into account, subject to the rules of natural justice. 5. However, in our opinion, what was said, explicitly or implicitly, did not go so far as to convey that the Appellant had used the premises for the taking of prohibited drugs and that dealers were supplying her at the premises. 6. Ms Madgwick submitted that that was a reasonable inference that could be drawn from the statements by the tenant advocate, in particular the proposition that she had become a drug addict since moving to Pegler Way (the premises). 7. We do not agree. If the issue was use of the premises for drug taking and supply from dealers at the premises, in our opinion, the statements lacked the requisite clarity, precision and directness to be capable of proving such facts. 8. In this respect, it was common ground between the parties that, given the nature of the matters required to be proved for the purposes of s92(1)(b), the higher civil standard of proof commonly known as the Briginshaw standard was applicable. The requisite conduct was not to be established by "inexact proofs, indefinite testimony, or indirect references" (Briginshaw v Briginshaw (1938) 60 CLR 336 at 361-362). 9. In our opinion, the findings of the Tribunal below concerning the Appellant's use of the premises for unlawful purposes involving the taking of prohibited drugs and supply of drugs by dealers were not open on the information provided. This constitutes an error of law: see Kostas v HIA Insurance Services Pty Ltd [2010] HCA 32, (2010) 241 CLR 390 at [16] and [91]. Orders 1. For the foregoing reasons, we allowed the appeal and made the following orders on 17 June 2016: 1. The time for the Appellant to lodge the appeal is extended to 1 April 2016. 2. Allow the appeal. 3. Set aside orders 1 and 2 made on 7 December 2015. 4. Remit the whole of the case to be determined by a differently constituted Tribunal, with liberty to the parties to adduce further evidence. 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: 19 July 2016