Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Mo v ABC Homes NSW Pty Ltd [2019] NSWCATAP 16 Hearing dates: 11 December 2018 Date of orders: 01 February 2019 Decision date: 01 February 2019 Jurisdiction: Appeal Panel Before: S Westgarth, Deputy President J McAteer, Senior Member Decision: Appeal dismissed. Catchwords: CONTRACT INTERPRETATION – Fresh evidence on appeal Legislation Cited: Civil and Administrative Tribunal Rules 2014 Civil and Administrative Tribunal Act 2013 Cases Cited: Nil Texts Cited: Nil Category: Principal judgment Parties: Shu Chi Leung Mo (Appellant) ABC Homes NSW Pty Ltd (Respondent) Representation: S C L Mo (Self Represented) (Appellant) ABC Homes NSW Pty Ltd (Self Represented) (Respondent) File Number(s): AP18/41210 Publication restriction: Unrestricted Decision under appeal Court or tribunal: Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Citation: N/A Date of Decision: 15 August 2018 Before: C Paull, Senior Member File Number(s): HB 17/16698 & 17/37202 REASONS FOR DECISION Background 1. This is an appeal from a decision made in the Consumer and Commercial Division of the Tribunal published on 15 August 2018 (which we will refer to as the Decision). The Decision concerned two applications: one brought by the appellant (the homeowner) and the other, an application brought by the respondent to the appeal (the builder). Both applications were dismissed. The homeowner appeals the Decision in respect of her application. Summary of the Decision 1. In understanding this appeal it is helpful to have a summary of the Decision which is set out as follows: 1. The homeowner and the builder entered into a written contract in July 2015 for the builder to construct a new two storey dwelling. The builder issued Progress Claim 5 (PC5) on 13 September 2016 for $145,750.00 of which the homeowner paid $60,000.00; 2. A dispute developed and the builder last worked on site in mid-October 2016; 3. The homeowner commenced proceedings in the Tribunal in April 2017 seeking damages for incomplete work, alleging that the builder was not entitled to stop work, seeking damages for defective work and delay costs; 4. The homeowner alleged that the builder overcharged her in PC5 and that the builder engaged in "double dipping" by charging for the same work in PC5 and in variation claims issued in September 2016; 5. The builder lodged a cross application in August 2017 seeking $47,537.00; 6. The Decision describes the homeowner's evidence and points to deficiencies in the evidence. For example, at paragraph 27 the Decision records that the homeowner put forward "partial documents" to support her case (e.g. a final page of a letter from Parramatta Council) and states that without "any frame of reference and in the absence of being in complete form, such documents are of no weight"; 7. The evidence put forward by the builder is similarly described as having little weight (for example see paragraph 33 of the Decision); 8. The Decision records the homeowner's claims with respect to items of defective work. All of those claims were dismissed and, to the extent necessary, we will subsequently in these reasons return to the basis for those dismissals; 9. In the Decision, there was an analysis of whether PC5 was issued consistent with the terms of the contract or in breach of the contract. The Member found that the builder was entitled to issue PC5 with the consequence that, as a result of non-payment by the homeowner, the builder was entitled to suspend the work. That was the consequence of the Tribunal finding that non-payment of PC5 put the homeowner in breach of the contract; 10. In the Decision, the Member outlined the chronology of events and concluded that the homeowner was not entitled to purport to terminate the contract and that the builder did not repudiate the contract. The Decision recorded that it followed that the homeowner was not entitled to damages for incomplete work or delay costs; and 11. In respect of the builders cross application, the Decision recorded that the builder could not adequately explain how he arrived at the sums claimed because no material was provided to substantiate the figures sought. Essentially, through the lack of supporting evidence, the Tribunal came to the conclusion that the builder was unable to provide evidence in support of his application. Notice of Appeal 1. The Notice of Appeal was filed on 19 September 2018. The Notice of Appeal states that the Decision was received on 17 August 2018. Rule 25(4)(c) of the Civil and Administrative Tribunal Rules 2014 (the Rules) is applicable and requires the appeal to have been filed within 28 days (i.e. on or before 14 September 2018). The Notice of Appeal appears to have been filed 5 days out of time and the builder submitted that the Appeal Panel should not extend the time for filing the appeal. In the Notice of Appeal the homeowner sought an extension of time and stated that the delay was caused by the need to obtain the sound recording of the first instance hearing and to review it. In view of the fact that the delay in filing the Notice of Appeal was relatively short, that the explanation for the delay is reasonable and the fact that the builder did not argue that it was prejudiced, we propose to extend the time for the filing of the appeal pursuant to the power contained in s 41 of the Civil and Administrative Tribunal Act 2013 (NCAT Act). 2. In the following paragraphs we summarise the Grounds of Appeal. Ground 1 1. The homeowner submitted that the Tribunal erred in failing to find that PC5 was invalid. The homeowner submitted that the effect of clause 20 of the contract was that the builder could only issue a progress claim for work performed. The homeowner submitted that the Payment Schedule is to be read subject to the provisions of the contract, particularly clause 20. Ground 2 1. The homeowner submitted that the builder "deceived his expert" and the Tribunal by submitting "false AO.3 architecture drawing" and by not submitting drawing AO2.2, AO3.2. The homeowner submitted that if the correct drawing had been in evidence, her submission that electrical provisions had been installed incorrectly could have been proven. Ground 3 1. The homeowner submitted that the Tribunal was in error in not holding that certain electrical installations were defective because they were installed only 30cm above the floor. It is submitted that this does not conform to safety standards. Ground 4 1. The homeowner submitted that the Tribunal erred in denying that a letter from the Department of Fair Trading was in evidence whereas in fact it was in evidence. Ground 5 1. The homeowner submitted that two affidavits relied upon by the builder, namely the affidavit of Carl Ward and Barry Beilby alleged a "case of crime through the above two people". 2. The builder filed a reply which disputes each of the Grounds of Appeal. Homeowner's Submissions 1. The homeowner has filed various submissions and we will summarise them in the following paragraphs. Ground 1 1. The homeowner repeated her submission that the Payment Schedule should be read subject to clause 20 of the contract. The effect of clause 20 is that the builder can only claim for performed work. 2. At the hearing, the homeowner made the submission that the Payment Schedule did not form part of the contract. In our view, that submission is inconsistent with the submission that although the Payment Schedule forms part of the contract, it is to be read subject to clause 20. We will return to that issue later. Ground 2 1. The homeowner's submission with respect to Ground 2 is, as indicated in the Notice of Appeal, that the builder deceived his own expert and the Tribunal by submitting a false drawing. There is, in our view, no evidence supporting the allegation that the builder engaged in deception. 2. At the hearing, we sought clarification of this submission. The homeowner showed us two plans. One was said to be the correct plan and the other an earlier plan which was said to be incorrect. The homeowner said that the correct plan was shown to the Member at first instance, but could not identify evidence of that occurring by reference to the transcript. In our view, the submission that the builder deceived the Tribunal by tendering an incorrect plan seems to be inconsistent with the submission that at the first instance hearing, the Member was shown the correct plan by the homeowner, in the sense that any alleged deception appears to have been corrected. 3. The homeowner submitted that the correct plan showed that the staircase referred to in the Decision at paragraph 46 should have been constructed out of timber. The builder built the staircase using concrete. At the hearing, we asked the homeowner to show us on the plans where it was indicated that that staircase was to be constructed out of timber. We were shown a document which referred to a staircase to be constructed out of timber but the builder interjected and said that there were two staircases to be built. One was to be built out of timber (which occurred) and for the other there was no stipulation. He said he built the disputed staircase out of concrete because of its location near the basement and the risk of damp. Ground 3 1. This submission is to the effect that the power points in the wet areas are only 30cm above the floor and breach safety requirements. We were not provided with any evidence that the location of the electrical installations were as alleged by the homeowner. The builder denied the allegation. Ground 4 1. The homeowner submitted that the Tribunal "erred in ignoring Parramatta Council's assessment on the site excavation and yard tree". The homeowner submitted that the Tribunal erred in paragraph 27 of the Decision. Where the Tribunal stated that the final page of a letter from Parramatta Council should be given no weight as it is only part of a document and therefore incomplete without a frame of reference. The homeowner submitted that the letter contained a sentence to the effect that "the excavation extended further than the DA conditions permitted". Ground 5 1. The homeowner submitted that the Tribunal was biased in accepting that work was done at the homeowner's request. 2. Finally, the homeowner submitted that the appeal should be upheld with an order that the application be remitted to the Consumer and Commercial Division for a rehearing. Homeowner's Further Submissions 1. At the hearing of the appeal, the homeowner tendered a statement alleging that certain evidence provided at the first instance hearing by the builder was false. We were also provided with a number of documents which were intended to show that the builder's evidence could not be relied upon. For reasons which we will set out subsequently, we do not intend to consider this evidence. Builder's Submissions 1. The builder filed a Reply to Appeal and provided written submissions, the substance of which was to oppose the submissions of the homeowner. At the hearing of the appeal, the builder made oral submissions which we summarise as follows: 1. The builder submitted that the Payment Schedule was part of the contract and in response to Ground 1 submitted that its terms governed the payment obligations of the homeowner under the contract; 2. The builder submitted that the plans submitted for consideration by the Member at the first instance hearing were the plans which the homeowner's expert Mr Cavallo had relied upon in support of the opinions that he put forward. The builder submitted that there was no submission put by the homeowner that the plans considered by Mr Cavallo were incorrect and that there were other (correct) plans; and 3. The builder submitted that the plans did not contain precise requirements for the location of electrical installations and that many locations were left to the builder to decide. The builder submitted that all electrical installations complied with safety standards. The builder submitted in respect of the concrete staircase that there was no requirement for that staircase to be made of timber and that he chose concrete because the staircase commenced at its base in the basement area. Homeowner's Submissions in Reply 1. In reply, the homeowner made oral submissions to the effect that the payments she made were made not because she was contractually obliged to do so, but because she thought that it was necessary to do so to maintain goodwill with the builder. 2. Further, the homeowner submitted in response to an assertion made by the builder that she interfered with his tradesman, that she only attended the site to negotiate with the builder as to the location of the electrical sockets which were not specified in the plan. She said that otherwise she did not talk to his tradesmen. Decision 1. For the reasons which follow, we are of the opinion that the appeal should be dismissed. 2. This is an appeal brought under s 80 of the NCAT Act. By that section the homeowner is able to bring an appeal as a right on any question of law or with the leave of the Appeal Panel on any other ground. The other grounds are set out in the provisions of cl 12 of Sch 4 of the NCAT Act. Clause 12 provides as follows: 12 Limitations on internal appeals against Division decisions (1) An Appeal Panel may grant leave under section 80 (2) (b) of this Act for an internal appeal against a Division decision only if the Appeal Panel is satisfied the appellant may have suffered a substantial miscarriage of justice because: (a) the decision of the Tribunal under appeal was not fair and equitable, or (b) the decision of the Tribunal under appeal was against the weight of evidence, or (c) significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with). Note. Under section 80 of this Act, a party to proceedings in which a Division decision that is an internally appealable decision is made may appeal against the decision on a question of law as of right. The leave of the Appeal Panel is required for an internal appeal on any other grounds. (2) Despite section 80 (2) (b) of this Act, an internal appeal against a Division decision may only be made on a question of law (as of right) and not on any other grounds (even with leave) if: (a) the appellant is a corporation and the appeal relates to a dispute in respect of which the Tribunal at first instance had jurisdiction because of the operation of Schedule 3 to the Credit (Commonwealth Powers) Act 2010, or (b) the appeal is an appeal against an order of the Tribunal for the termination of a tenancy under the Residential Tenancies Act 2010 and a warrant of possession has been executed in relation to that order. 1. The homeowner did not seek to categorise the various grounds of appeal as raising questions of law or whether a particular ground was one requiring leave. It is not necessary for us to determine whether the grounds raised questions of law or whether they are cl 12 grounds, as we are of the opinion that each of the grounds lacks merit. We will deal with each ground separately. Ground 1 1. Clause 4 of the contract contains provision for a deposit to be paid. In this case, the deposit was $29,000.00. Clause 4 goes on to provide three different options for payment. The clause states that "Payments are to be made in all cases in accordance with clauses 18, 19, 20 and 23". Options 1 and 2 have been deleted and option 3 has been circled. Option 3 states: "As per the terms agreed by the parties. Those terms must be set out in writing and attached to the contract at the time of signing it." 1. Clause 20 provides that a progress payment claim by the builder is to show: 1. the value of the contract work performed at the date of the claim; 2. the value and brief description of any variations which are included in the claim; 3. other adjustment under the provisions of the contract; 4. the amount previously paid by the homeowner, other than a deposit; the amount claimed by the builder being the difference between the total of paragraphs (i), (ii) and (iii) AND paragraph (iv); and 5. there is provision for GST which is not relevant to this discussion. 1. The Payment Schedule provided for a number of progress claims to be made and the amount payable to be a percentage of the contract. For example, the stage concerning "excavations/drainage/slab pouring (stage 2) required a payment of 20% of the contract price. There is an obvious typographical error in relation to stage 3 where the figure of $1,116,600.00 should be $116,600.00. 2. The issue causing controversy between the parties is that the Payment Schedule required the progress claims to be due for payment at the "start of" the relevant stage. PC5 was required to be paid at the start of "internal fixings". 3. It is the homeowner's case that there is an inconsistency between the Payment Schedule requiring payments to be made at the "start of" a particular stage and the provisions of clause 20 which in substance provides for the builder to make a claim for the value of the contract work "performed" at the date of the claim. In our view, the apparent inconsistency between the Payment Schedule and clause 20 can be resolved in favour of the view that the Payment Schedule prevails. There are two reasons for this conclusion. 4. The first reason is that it is a principle of contract interpretation that where a specific provision has been inserted into a contract containing general terms, it is the case that the specific provision should prevail to the extent of any inconsistency, over the general provision. In this case, the words "start of" were included in the Payment Schedule and they must be given their meaning in preference to the provisions contained in clause 20. 5. The second reason is that in our view, it is arguable that there is in fact no inconsistency between the Payment Schedule and clause 20. Clause 20 contained the provision to include in the claim "other adjustments under the provision of the contract" (see clause 20(b)(iii)). In our view, both the requirements of the Payment Schedule and of clause 20 can be adhered to by finding that the builder was entitled to include as another adjustment the value of the work about to be started. 6. In our view, it is clear that the contract permitted the builder to submit a progress claim at the start of each stage set out in the schedule. 7. In our view, the Decision displays no error in finding that PC5 was issued in accordance with the terms of the contract and therefore, that lead to the builder being entitled to suspend the work. Ground 2 1. The homeowner showed us two copies of plans at the hearing, we were not provided with copies beforehand and it was not apparent that the builder had been given copies beforehand (although he recognised them on being shown them). The homeowner could not provide evidence to us in the form of statements on the transcript that the homeowner drew to the attention of the Member that the "correct" plan did show the precise location for the installation of electrical connections. 2. It is clear from the Decision that the homeowner's expert (Mr Cavallo) provided opinions based upon contract plans which did not show the specific location of various installations (see paragraph 51, 55 and 87 as examples of findings by the Tribunal that the plans did not contain specification as to where items were to be installed). 3. The homeowner's submission by reference to the plan which she described as the "correct" plan involves a submission that the wrong plan was provided to her expert and was evidence in her case before the Tribunal at first instance. In effect, the homeowner now wishes to adduce fresh evidence of a different plan which she describes as the "correct" plan. Based upon the evidence before the Member, there was no error of law. The question which arises is whether the homeowner may, by reason of cl12(1)(c) of Sch 4 of the NCAT Act introduce the new evidence. That provision permits fresh evidence which was not reasonably available at the time the proceedings under appeal were being dealt with. There was no evidence or submission made by the homeowner that the correct plan was not reasonably available. Accordingly, the homeowner's submission that the "correct" plan should be now considered as the basis for upholding her appeal is rejected. 4. The conclusion we have reached in the above paragraph is not just based upon the specific requirements of cl 12 of Sch 4 of the NCAT Act. In addition, it is necessary to say that there is an important policy behind the restriction on the introduction of fresh evidence in an appeal. Cases must be properly prepared, heard and finalised. If a party who is unsuccessful were to be allowed to introduce fresh evidence subsequently, the risk would be that the case would not be finalised but would be reopened for the purposes of the fresh evidence being considered. It is in the interests of justice that there be finality to disputes between parties, and finality is not assisted if fresh evidence is allowed to be introduced after the first instance hearing has concluded and should not be allowed expect in limited circumstances. 5. Finally, the submission that there was a plan (the correct plan) which showed the location of electrical installations is inconsistent with her statement to us in reply that she went to the site to negotiate the placement of electrical sockets. Ground 3 1. The submission here is that the Tribunal erred in finding that the homeowner's expert gave evidence as to the incorrect placement of electrical installations based upon instructions from the homeowner, in circumstances where the builder disputed that allegation. The homeowner did not provide us with evidence that would lead us to conclude that the Tribunal had erred. Ground 4 1. The homeowner's submissions that the Tribunal erred in rejecting a page of a letter from Parramatta Council as persuasive evidence is also rejected. The homeowner states that the full letter was contained in the builder's documents folder. We have held that PC5 was valid. It follows that the consequential findings made by the Tribunal are also valid: that is, that the builder was entitled to suspend the work (paragraph 103 of the Decision) and that the homeowner is not entitled to damages for incomplete work (paragraph 154 of the Decision). Accordingly, in our view, even if the Tribunal had considered fully the letter from Parramatta Council, the homeowner would not have been entitled to damages under the contract. Ground 5 1. The homeowner submitted that the Tribunal expressed "obvious bias". This assertion was not supported by any evidence and is therefore to be rejected. Additional Grounds 1. Earlier, we referred to the fact that the homeowner handed up some submissions at the hearing of the appeal intended to show that certain evidence given at first instance was false. The documents in question were an affidavit of Carl Ward and an affidavit of Barry Beilby which the homeowner said had been relied upon by the builder but which were false. The homeowner submitted that Mr Beilby had written on both affidavits that they were false. In our view, the evidence should be rejected. We were not provided with any evidence as to how this fresh evidence came about or why it should be admitted on appeal. There was no submission that it was not reasonably available at the first instance hearing. In addition, Mr Beilby was not present. Conclusion 1. In all of the circumstances, it is our view that the homeowner has failed to establish that the Decision contains any error of law, or that one of the grounds set out in cl 12 of Sch 4 of the NCAT Act has been made out. Therefore the appeal must be dismissed. Orders 1. The Appeal Panel makes the following order: 1. Appeal 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: 01 February 2019