Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Gallagher v Masters Installation Pty Ltd [2017] NSWCATAP 117 Hearing dates: 14 November 2016 Date of orders: 24 May 2017 Decision date: 24 May 2017 Jurisdiction: Appeal Panel Before: Lionel Robberds QC, Senior Member T Simon, Senior Member Decision: The appeal is dismissed Catchwords: Breach of contract – damages - discharge of onus of proof – what evidence is sufficient – no application of the difficulty in estimating damages rule – costs – no special circumstances Legislation Cited: Civil and Administrative Tribunal Act 2013 (NSW) Cases Cited: Biggin and Co Ltd v Permonite Ltd (1952) 1 KB 422 Clark v Macourt (2013) 304 ALR 220 Gerrard v Slamar [2014] WASCA 253 Jones v Schiffman (1991) 124 CLR 303 The Commonwealth of Australia v Amann Aviation Pty Ltd (1991) 174 CLR 64 Texts Cited: Carter on Contract Category: Principal judgment Parties: Alissa Michelle Gallagher (appellant) Masters Installation Pty Ltd (respondent) Representation: C Johnston (appellant's agent) G Rawling (respondent's agent) File Number(s): AP 16/39778 Decision under appeal Court or tribunal: Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Date of Decision: 21 July 2016 Before: P Boyce, Senior Member File Number(s): GEN 16/14259 Reasons for Decision 1. On 22 January 2016 Alissa Michelle Gallagher (the Appellant) lodged an application with the Tribunal seeking orders that Masters Home Improvement pay the Appellant $34,233 and that she did not have to pay the amount of $1,197, being the balance unpaid on the contract. 2. On 24 February 2016 the Tribunal made the following relevant orders: 1. The Tribunal orders that the respondent(s): Masters Home Improvement Pty Limited … is to carry out the following work on or before 16-Mar-2016 in a proper and workmanlike manner. Details of Work order: Rectify defective topping screed and install vinyl flooring as per contract dated 29 Sep 2015. …. 3. The Tribunal directs that the applicant may seek to relist this matter for determination on or after 17 March 2016, provided that the relisting is in respect of the subject matter of these proceedings. 1. The Appellant alleged that the Respondent failed to comply with that order and she made an application dated 17 March 2016 to renew the proceedings. . 2. The Respondent denied that it had failed to comply with the order and alleged that the Appellant had refused to permit the Respondent and its employees access to the Appellant's premises to allow the work to be carried out. 3. The application was then heard pursuant to clause 8 (2) of Schedule 4 of the Civil and Administrative Tribunal Act 2013 (the Act). The Appellant's claims 1. At the hearing before the Tribunal Member, the Appellant made 24 claims totalling $24,825. Each of the 24 claims claimed a separate amount of money. The Appellant also made a further claim described as "Damages for inconvenience the amount of which is not specified." 2. On the appeal the Appellant only pursued 7 claims which were described in the Appellant's written submissions as follows: 1. The amount required to remove the tiles - $2,310.00 2. The amount required to dispose of the tiles (skip hire) - $500.00 3. The amount required to remove and replace kick boards - $1,320.00 (quote to come) – amount represents a guide. 4. The amount required to connect and reconnect the electrical appliances $1,600 (claim reduced to minimum connections and disconnections) 5. The amount required to provide Carpet Cleaning - $350 6. The amount required for new flooring $4,660.00 7. The return of the deposit paid by the Appellant - $1,197 1. The Tribunal Member had ordered that the above amounts of $2,310 and $1,197 be paid by the Respondent to the Appellant and had declared that the amount of $1,197 (which was the balance unpaid on the contract) was not due and owing by the Appellant to the Respondent. Accordingly no orders are made by the Appeal Panel in respect of those amounts. 2. The claims described in subparagraphs 7 (b) – (f) above, were five of the claims pursued before the Tribunal Member who heard the Appellant's application. However in respect of the claims referred to in subparagraphs 7 (b), (d) and (e) lower amounts were claimed by the Appellant on the appeal. Tribunal Member's findings 1. The Tribunal Member made a number of findings which included the following: 20. On 23 September 2015 the respondent quoted the applicant to supply and install flooring to the applicant's kitchen. Although the quote stated that the flooring substrate was the applicant's responsibility the quote included an amount to supply and carry out the application of the flooring substrate. The quote provided that the scope of the works would be to supply "Click Vinyl Planks Mahogany", install vinyl floating flooring, supply and fix trim and supply and install Ardex feather finish substrate for an amount of $2394.00…. 22. On 29 September 2015 the parties signed a form of agreement titled "Minor Contract" for the respondent to supply material and carry out work for a cost of $2,394 (the amount of the quote). 23. On 30 September 2015 the respondent caused the Ardex substrate to be applied to the applicant's existing ceramic tiled floor. 24. Between 1 and 5 October 2016 the applicant complained that the work that was carried out by the respondent's sub-contractors was defective. 25. During an inspection of the work by an independent contractor nominated by the respondent the applicant was informed that the work that had been done was deficient and that the vinyl planks could not be laid on it. 26. The respondent proposed that its contractors return to the site to attempt to remedy the defective work. …. 31. It is uncontentious that the respondent accepts that the works carried out were defective. It complains that it has been frustrated by the applicant's failure to grant access to the respondent to carry out the rectification work and install the vinyl as ordered by the Tribunal. 32. The applicant contends that she has been ready and willing to allow access to the premises to carry out the work, but the works proposed will not remedy the defects. 33. The respondent submits that no matter what it does, the applicant is likely to never be content with the work carried out by the respondent. 34. The Tribunal is satisfied that on that basis, with the frustration of the orders, there is no utility to be served in ordering further rectification works and now hears and determines the application on the renewal. 36. The Tribunal is satisfied that the applicant is entitled to a refund of the monies paid by her to the respondent in the amount of $1,197.00 and that the applicant is further entitled to an order that the balance of the price of $1,197 is not payable as the respondent has been unable to fulfil its promises under the contract to complete the installation of the flooring and the work done so far is defective. 37. There remains a consideration of the applicant's evidence to determine what, if any, is an amount that should be paid by the respondent to put the applicant in the position she was in before the contract was entered into. …. 41. On the applicant's evidence the Tribunal is satisfied that the respondent failed to deliver the services as promised or at all and thereby failed to comply with the guarantee to deliver that part of the service in that it will perform its obligations under its agreement within a reasonable time. To that extent, the respondent also failed in its obligation to provide its service with due care and skill. 42. The applicant is entitled to a refund of the monies it (sic) has paid to the respondent. 43. In addition the Tribunal finds on the evidence before it that as a result of the defective work carried out by the respondent the applicant will suffer loss. Some of the loss claimed by the applicant is based on the applicant's estimates without being supported by probative corroborative evidence that satisfies the civil standard of proof. 44. Tribunal allows: a. As (sic) the loss suffered by the applicant the Tribunal is satisfied that the tile floor will need to be removed and the quote from All stripped-Tile Removal Specialists dated 24 November 2015 for $2,310.00 is the amount that should be relied upon to establish that cost. There is no probative evidence before the Tribunal as to the cost of then levelling the floor ready for the installation of a flooring product. b. The amount paid by the applicant to the respondent by way of deposit in the amount of $1197.00 as there has been a failure by the respondent to supply and install the flooring as agreed. c. The total amount being $3507.00 45. The Tribunal disallows the applicants claim as to the remainder of her heads of alleged loss as the applicant has not supported that claim with evidence sufficient to satisfy the civil standard of proof and is dismissed. Notice of appeal 1. The grounds of appeal were stated to be: Applicant was not returned to the position she was in prior to the major damage plus other area of 'consumer law' (ACL) refer to all notes as well. 1. The order which it was said in the notice of appeal that the Appeal Panel should make was stated as: an award of Applicant's cost plus (sic) award of loss and damages with corroborative evidence, less monies received to date. 1. The notice of appeal sought leave to appeal and it was said to see the attachment notes for information as to the reasons why the Appeal Panel should grant leave to appeal. 2. In so far as it was said that the decision was not fair and equitable, the notice of appeal was completed by directing reference to additional notes. 3. In so far as the notice of appeal alleged that the decision was against the weight of evidence, the notice was filled in with: I gave no evidence at the Tribunal, entered into evidence at the Tribunal was my folder, late evidence excepted, my verbal speech (submission notes as I had intended to read, no hearing in full took place on day decision made made later date. 1. The notice of appeal asked what evidence should the Tribunal have given more weight to and why. Those questions were answered as follows: refer to attached notes as there are so many points e.g. corroborative evidence was present in my folder, omitted in the Tribunal decision, matters of law not complied with that were not included in the decision, suffered a substantial miscarriage of justice, decisions made unfair and inequitable too many additional reasons as to why which are included on attached notes. 1. It was said that significant new evidence was now available that was not reasonably available at the time of the hearing and reference was made to the attached notes. In answer to the question why this evidence including documents was not available at the time of the hearing, reference was made to the attached notes. 2. Attached to the notice of appeal was a document comprising 21 pages. It set out arguments on the facts and on the law and in particular it dealt with all of the 24 claims which we have referred to above. 3. On page 5 of that document the Appellant requested the Appeal Panel to refer to the summary submission notes; that was intended to be spoken at the Tribunal hearing, however ultimately was handed to the Tribunal and entered into evidence at the hearing for later determination. 1. The Appeal Panel has had regard to that document which dealt in considerable detail with the issues and the Appellant's submissions on those issues. 2. As the Appellant's written submissions limited the areas of dispute it is more appropriate, in these reasons for decision, to concentrate on those submissions. Appellant's written submissions 1. The opening paragraphs of these submissions were in the following terms: The following facts were common ground at the hearing: 1.That there was an agreement between the Applicant and the Respondent (minor contract) for the respondent to supply and install a vinyl floating floor of 36.7m2 in the applicant's home at ……. for a price of $2,394.00. 2.That the Respondent, whilst performing the agreement, applied Ardex and Concrete substrate to the floor without due care and skill. 1. The Respondent in its written submissions did not dispute those paragraphs. 2. It was submitted by the Appellant that as a result of the failure to apply the Ardex and Concrete with due care and skill, the Appellant made a claim for her losses. It was the Appellant's case that the application of the Ardex and Concrete had left the surface of the floor unsuitable for the installation of the flooring because the floor was not level. It was submitted that the question for the Tribunal Member to determine was the quantum of the loss suffered. 3. It was submitted that the appeal involved a question of law. In par [37] of his reasons for decision, the Tribunal Member stated in effect that a question he had to determine was what, if any, is an amount that should be paid by the Respondent to put the Appellant in the position she was in before the contract was entered into. It was submitted that that statement was an error of law. Clark v Macourt (2013) 304 ALR 220 was referred to as authority for the proposition that the measure of loss was not what should be paid to put the Appellant in the position she was in before the contract was entered into, but rather the position she should have been in had the breach not occurred. The Appeal Panel agrees with this submission. 4. It was also submitted that the grounds of appeal raised questions regarding procedural fairness for which leave to appeal was required. 5. It was submitted that the amounts referred to in par [7] above should be awarded to the Appellant in order to place her in the position she would have been in had the breach not occurred. 6. Another submission was made which raised a question of law and it was expressed in these terms: difficulty of assessment should not be a bar to the assessment of damages, and the Tribunal must do the best it can. In support of that submission the Appellant relied upon Biggin and Co Ltd v Permonite Ltd (1952) I KB 422 per Devlin J at page 438; The Commonwealth of Australia v Amann Aviation Pty Ltd (1991) 174 CLR 64 at page 83 per Mason CJ and Dawson J and Jones v Schiffman (1971) 124 CLR 303 at 308 per Menzies J. 7. As far as we are able to see that question of law was not raised in the notice of appeal. Respondent's written submissions 1. The Respondent submitted that it did not accept that the defective installation was such that it could be classified as a major defect. So far as the claim for $4,660 for new flooring was concerned, the Respondent submitted that to facilitate the installation of this flooring, the Appellant would need to remove the tiles and the tile bed as compensation for the additional thickness of the bamboo flooring (14 mm) as opposed to the contracted vinyl flooring of 3mm thickness. It was submitted that the proposed scope of the works exceeded that which would be reasonably required for the original contracted works. 2. The Respondent submitted that the Appellant had ample time to obtain appropriate quotations. 3. The Respondent further submitted that it should not be liable to compensate the Appellant for all of the floor substrate (tiles and concrete) as the floor substrate was existing and not laid by the Respondent. It was submitted that nor was it necessary to remove tiles for the installation of the contracted vinyl flooring. 4. The Respondent submitted that the Appellant had ample time to obtain appropriate quotations for the replacement of the kickboards; that the Appellant failed to provide appropriate quotations or invoices for the alleged cost of disconnecting and reconnecting the appliances. The Respondent made a submission that the Appellant's calculations for this disconnecting and reconnecting were incorrect with the result that her claim was $800 not $1,600. It was submitted that the Appellant had failed to provide appropriate quotes or invoices for the alleged cost of cleaning the carpets. It was also submitted that the Appellant must accept some responsibility to ensure the screed was not walked through their home. 5. The Respondent disputed the Appellant's claims referred to in par 7 (b) – (f) above, which totalled $8,430. The $4,660 invoice 1. It is clear from pars [36], [37] and [41 – 45] of the Tribunal Member's reasons that in awarding the Appellant $3,507 and declaring that the Appellant was entitled to an order that the balance of the price of $1,197 was not payable, he was, in his mind, putting the Appellant back into the position she was in before the contract was entered into. 2. Apart from recording that the Appellant made a claim of $4,660 based on a quotation from Carpet Court for the cost of timber flooring, the Tribunal Member did not again refer to that quotation in his reasons for decision. We conclude that the reason the Tribunal Member expressed himself in this way was because he was satisfied that the orders he was about to make would put the Appellant back into the position she was in before the contract was entered into. 3. In her 21 page document which she filed with her notice of appeal, the Appellant referred to the $4,660 quotation and stated that she withdrew that option and put forward other alternatives, none of which were supported by a written quotation. 4. This means that there is no evidence before the Appeal Panel as to the cost of this proposed work. Furthermore the Respondent disputed the $4,660 quotation because in its submission, the proposed scope of the work exceeded that which would be reasonably required for the originally contracted works. 5. There was no evidence from a relevant contractor or expert that the new proposed work was necessary to put the Appellant in the position she should have been in had the breach of the contract not occurred. The same can be said about the quotation for $4,660. The Appeal Panel is therefore of the view that the Appellant's claims in respect of the alternatives referred to in par [37] above must fail. Had the original claim for the $4,660 been pursued, that also would have failed. 6. So far as the claims in par [7] (b), (c), (d) and (e) are concerned the appeal must fail because the Tribunal Member was correct in his finding that there was no proof as to the quantum of those claims. Directions 1. On 22 September 2016, the Appeal Panel constituted by Mr D Cowdroy ADCJ, gave directions which included that the parties should be prepared to put before the Appeal Panel any fresh evidence as well as any evidence that was before the Tribunal at first instance and make any submissions in relation to the original application that they want to make. If a party wished to rely on a sound recording of a hearing, the party was required to identify for the Appeal Panel which parts of the sound recording are relied on in their written submissions. 2. The 21 page document referred to in par [18] above dealt with numerous aspects of the dispute and the hearing before the Tribunal Member. In the first one and a half pages of this document statements were made that natural justice had not been accorded to the Appellant. The document referred to the Appellant's submission notes and it was stated on page 1 of the document that the submission notes were originally written up with the intention of representing notes which the Appellant intended to verbally go through at the commencement of the final hearing. The Appellant complained in this document that because of the manner in which the Tribunal hearing was conducted, this hindered her ability to be able to contribute verbally to point or direct the Tribunal to any particular supporting evidence that the Appellant was aware existed in the folder and submission notes provided. On page 2 of the document the Appellant complained that many incorrect decisions were determined (by the Tribunal Member) without the Appellant being able to be verbally heard to clarify where the accurate information was inside the folders which had been tendered. It was said that this information would have supported the Appellant's claim by providing probative corroborative evidence that would satisfy the civil standard of proof applicable to s62 (2) of the Act. 3. We take it that what is stated in the first two pages of the document is relied upon to support a submission that because the Appellant was denied the opportunity to make oral submissions, she was denied natural justice or procedural fairness. 4. In her written submissions to the Appeal Panel, the Appellant submitted that at the hearing the Tribunal Member did not ask her to speak to her claim so that she was not able to explain her claims for the skip, kickboards, connection/disconnection of appliances and other matters as outlined earlier in the submission. She also stated that instead, the Tribunal Member asked her to hand up her folder of materials and made findings based on the written material. It was submitted that this put the Appellant at a serious disadvantage because she was not able to meet the Tribunal Member's concerns regarding the lack of probative evidence. The Appellant submitted that had the Tribunal Member heard from her he would have been in a better position to assess the claim and the measure of loss suffered by her and would have been able to do the best he could to put the Appellant in the position she should have been but for the breach. 5. In the Respondent's written submissions to the Appeal Panel it was submitted that all parties were offered and received the same opportunity to present their case in a fair and equitable process. There was no suggestion of the Member not applying procedural fairness to the determination based on the submission provided by the parties. It was submitted that the Tribunal Member allowed sufficient time for both parties to make statements as to the merits of their respective submissions and that the Tribunal Member asked (at the conclusion of the hearing) if the parties wished to make any additional comments. It was said that at that time the Appellant requested the opportunity to submit additional commentary on her case which was submitted and accepted by the Tribunal Member who was under no compulsion or legal requirement to accept or hear the Appellant's additional information. It was said that nevertheless, the Respondent, at the request of the Tribunal Member, did not contest such submissions being made and that these were accepted by the Tribunal Member. 6. The directions given on 22 April 2016 alerted the parties to putting before the Appeal Panel evidence that was before the Tribunal Member and identifying parts of the sound recording. This disputed issue between the parties can only be resolved by having regard to the transcript or the sound recording of what took place at the hearing before the Tribunal Member. The parties did not put that material before the Appeal Panel and the Appeal Panel is thus unable to resolve this disputed issue. The claim that the Appellant was prejudiced or denied natural justice or procedural fairness or that, if the Tribunal Member had heard orally from the Appellant, the Tribunal Member would have been in a better position to assess her claim, must be dismissed. Onus of proof 1. The Appellant had the onus of proving that the amounts claimed represented losses suffered by her which were caused by the Respondent's breach of their contract. 2. Apart from the amounts referred to in par 9 above, the Tribunal Member disallowed the remainder of the Appellant's claims because she had "not supported (those claims) with evidence sufficient to satisfy the civil standard of proof." 3. The Appellant made the following submissions in her written submissions: 22. The Appellant had not been able to obtain quotes for all of the amounts claimed. As a result the Tribunal member found that the lack of probative evidence was fatal to the Appellant's claims (paragraph 43). 23. Difficulty of assessment should not be a bar to the assessment of damages, and the Tribunal must do the best it can: Biggin and Co Ltd v Permanite Ltd (1951) 1 KB 422, per Devlin J. at p 438; Commonwealth v Amann Aviation Pty Ltd [1991] HCA 54. In Amann at [31], Mason CJ and Dawson J note that in Jones v. Schiffmann [1971] HCA 52; (1971) 124 CLR 303 at 308, Menzies J. said that the "assessment of damages … does sometimes, of necessity involve what is guess work rather than estimation". 1. In Amann, Mason CJ and Dawson J at page 83 stated: The settled rule, both here and in England, is that mere difficulty in estimating damages does not relieve a court from the responsibility of estimating them as best it can. Indeed, in Jones v Schiffmann Menzies J. went so far as to say that the 'assessment of damages … does sometimes, of necessity involve what is guess work rather than estimation." Where precise evidence is not available the court must do the best it can. And uncertainty as to profits to be derived from a business by reason of contingencies is not a reason for a court refusing to assess damages. 1. The settled rule is subject to the proviso that the difficulty must not arise from the fact that the plaintiff has produced no evidence of loss or damage, or because the court has rejected the evidence which was put forward on loss caused by the breach. In either case the plaintiff will be restricted to a nominal sum (Carter on Contract [41-180]). The settled rule only applies where the facts and circumstances which the court is considering make it difficult for the court to estimate the damages suffered by a particular litigant. It does not apply where the party who has the onus of proof does not call evidence which is readily available to be placed before the Court, but the party does not do so (see Gerrard v Slamar [2004] WASCA 253 at [32] and [33]). In that case Heenan J with whom Steytler and Le Miere JJ agreed said at [33] – "To my mind, this is not a case where evidence attempting to quantify the loss from the vehicle being unavailable for that three month period was impossible to obtain nor inherently uncertain or incapable of reasonably precise calculation … ." At [34] his Honour continued: "In those circumstances I consider that this is a case where the respondent has failed to establish damages and that the court cannot estimate or guess in an endeavour to make good that omission.". Costs 1. Section 60 of the Act relevantly provides: 1. Each party to proceedings in the Tribunal is to pay the party's own costs. 2. The Tribunal may award costs in relation to proceedings before it only if it is satisfied that there are special circumstances warranting an award of costs. 3. In determining whether there are special circumstances warranting an award of costs, the Tribunal may have regard to a number of matters which are set out in the section. 1. In par [47] of his reasons for decision, the Tribunal Member dealt with the Appellant's claim to be reimbursed for the costs she had incurred in prosecuting her claim. The Tribunal Member dismissed the application "as she has not established that special circumstances apply to the conduct of the proceedings. Of itself, it is not fatal to such a claim, but the Tribunal notes that orders made on 24 February 2016 were not complied with, on the Respondent's submission because the Applicant refused to provide access to the premises." 2. The Appeal Panel is of the view that the Tribunal Member must have been influenced by the Respondent's submission referred to in par [47]. There has been no determination made by the Tribunal Member on that submission of the Respondent. In those circumstances the Appeal Panel is of the view that the Tribunal Member's discretion on costs miscarried. 3. The Appellant has submitted she should have been heard on the question of costs and that if she had been heard on the question of special circumstances she would have drawn to the attention of the Tribunal Member: 1. Her argument that the failure of the work order was not due to the Appellant's failure to provide access to her home; 2. The Appellant had a good case (given that the Respondent admitted defective work). 3. The Appellant found herself significantly out of pocket in trying to prove her losses. She submitted that she had incurred costs of $1,430 for a building inspection, $295 for a filing fee, $150 for a report and $9 for an ASIC search. 1. In her written submissions to the Appeal Panel the Appellant did not state to whom the $1,430 was paid nor whether it related to evidence which was accepted by the Tribunal Member and which resulted in a monetary order being made in favour of the Appellant. 2. Before the Tribunal Member the Appellant succeeded on only two of her 25 claims. The Appellant went into considerable detail in pursuing those claims and that in turn required the Respondent to be in a position to deal with this considerable detail. Those two facts indicate to the Appeal Panel that there were no special circumstances warranting an award of costs. 3. The Appeal Panel is of the view that the matters referred to in these paragraphs concerning costs show that there are no special circumstances within the meaning of s 60 of the Act. Order 1. For the above reasons the Appeal Panel is of the view that the appeal should be dismissed and the order of the Appeal Panel is: appeal dismissed. ********** I hereby certify that this is a true and accurate record of the reasons for decision of the New South Wales Civil and Administrative Tribunal. Principal Registrar 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: 24 May 2017