Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Saroya v Narayan [2019] NSWCATAP 228 Hearing dates: 18 June 2019 Date of orders: 16 September 2019 Decision date: 16 September 2019 Jurisdiction: Appeal Panel Before: P Durack SC, Senior Member D Goldstein, Senior Member Decision: (1) Pursuant to s 41 of the NCAT Act, extend the time for lodging the appeal to 22 March 2019. (2) Grant leave to appeal. (3) Allow the appeal. (4) Set aside Order 1 made on 22 January 2019 in proceedings COM 18/48366, namely the order that "the respondent is to pay the applicant the sum of $15,000 in respect of unpaid rent on or before 22 March 2019". (5) Remit to the Tribunal for redetermination by a differently constituted Tribunal the Lessor's claim in proceedings COM 18/48366 for Order 3 (an order that the new lease states the area leased as 10 acres as per verbal agreement) and Order 6 (an order that rent due up to 30 June 2019 in the amount of $15,000.00 be paid). Catchwords: AGRICULTURAL TENANCY – formal agreement unspecific as to area leased – error of fact - unjust to allow decision to stand Legislation Cited: Civil and Administrative Tribunal Act 2013 Civil and Administrative Rules 2014 Evidence Act 1995 Cases Cited: Collins v Urban [2014] NSWCATAP 17 Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22 Texts Cited: None cited Category: Principal judgment Parties: Sarbjit Singh Saroya (Appellant) Shiu Narayan (Respondent) Representation: Solicitors: MJO Legal (Appellant) Jeffrey McLaren (Respondent) File Number(s): AP 19/14809 Publication restriction: Nil Decision under appeal Court or tribunal: Civil and Administrative Tribunal Jurisdiction: Consumer and Commercial Division Citation: N/A Date of Decision: 22 January 2019 Before: R Harris, General Member File Number(s): COM 18/48366 REASONS FOR DECISION Summary 1. The appellant (the Lessee) is a blueberry farmer. He is the tenant of some agricultural land in northern New South Wales owned by the respondent (the Lessor). The issue between them is whether the land the subject of their agricultural lease for a ten-year term is five or 10 acres. 2. The Tribunal at first instance found the lease to be for 10 acres and ordered that the Tenant pay the outstanding amount of rent due for such an area, being the amount of $15,000.00. 3. The Tenant appeals from that decision. 4. The Tenant needs both an extension of time for his appeal and leave to appeal. 5. No error of law is raised. However, for the reasons below, we have decided to grant an extension of time, grant leave to appeal and allow the appeal. Factual background 1. The following facts were uncontroversial. 2. In November 2016 the Lessee and the Lessor signed a lease for "PART FOLIO IDENTIFIER 144/789434" commencing on 1 July 2016 for a term of 10 years, with an option to renew for a further five years. The rent was an annual rent of $1,000.00 per acre payable in advance on 1 July each year. 3. Despite the fact that the lease was prepared by a solicitor, the lease did not specify the quantity of acres leased or otherwise identify the particular part of the land that was the property leased. 4. The total area of the land in folio 144/789434 was considerably larger than 10 acres. 5. The purpose of the lease was the cultivation of blueberries. This appears from, at least, the following. Clause 4 described the permitted use as the "cultivation of any legal crop". The lease was signed in the context that the Lessee had already planted blueberries on part of the land owned by the Lessor. 6. At the time the lease was signed, there were no documents known to the parties setting out the area to be leased. However, the area actually planted with blueberries was readily identifiable and known to the parties. That was an area of very close to five acres in size. The area was shown and marked "C" on a diagram provided to the Tribunal at first instance. 7. No other well-defined area available for leasing to the Lessee was so identifiable at the time the lease was signed. 8. Prior to this planting of blueberries, the area planted had been cleared with some assistance from the Lessor. The lease did not expressly address the subject of the land being first cleared so that it was ready for a crop. 9. Next to this five acres was another five acres of uncleared land owned by the Lessor. 10. . This was shown and marked "D" on a diagram provided to the Tribunal at first instance. At the time the lease was signed this was uncleared land. No work was done on this land by the Lessee in 2016, nor prior to July 2017. 11. At the time, or shortly after, the lease was signed the Lessee paid the Lessor $10,000.00. The Lessee's explanation for paying this amount, and not the amount of $5,000.00, was that it was a payment of two years rent through to 30 June 2018 made for the benefit of the Lessor who had requested financial assistance for some building improvement to his property. The Lessor disputed this and claimed this payment showed that the area leased was 10 acres – this rent being payment of one year's rent through to 30 June 2017. 12. Before part of the land started to be cleared for the first blueberry crop, some discussion had occurred between Mr Narayan of the Lessor and the Lessee about leasing some land from the Lessor for blueberry cropping. A friend of the Lessee, Ms Gillet had introduced the parties. Ms Gillet had, apparently, been aware that the Lessor was wanting to find a tenant to farm part of the land. 13. The terms of this discussion were disputed. 14. There was no issue taken at first instance or on appeal about the legality of the Tribunal receiving evidence about this discussion for the purpose of deciding what the agreement was between the parties. 15. The Lessee did not pay any more rent in 2017. In particular, he did not make another payment of $10,000.00 on 1 July 2017 when such rent was due according to the Lessor's version of the lease. 16. The Lessor did not take any legal action in respect of what was, on the Lessor's case, a failure to pay the second year's rental ($10,000.00 due on 1 July 2017) until July 2018. 17. On 27 July 2018 the Lessor served a notice of termination based upon breach in failing to pay rent. In response, the Lessee paid the Lessor $5,000.00 on the basis that this was the rent due for the third year of the lease that expired on 30 June 2019. 18. In 2017, the Lessee spent money clearing the additional five acres marked "D" on the diagram. However, he did not proceed to plant a blueberry crop on this new area. According to the Lessee, this was because the Lessor refused to give him another written lease in respect of this additional area even though this had been verbally agreed subsequent to the lease signed in November 2016. 19. The Lessee was the first to commence proceedings in the Tribunal by action brought in August 2018 concerning alleged interference by the Lessor with the Lessee's rights in respect of the five acres where the blueberry crop had been planted. 20. Subsequent to the commencement of these proceedings, in November 2018, the Lessor brought an application in the Tribunal seeking recovery of unpaid rent and various other relief, including that "the lease" be reduced to registrable form and that the new lease state the area leased as ten acres "as per verbal agreement". The Tribunal's reasons 1. The Tribunal concluded that the area leased under the written agreement was ten acres and was the approximate area designated "C" and "D" in the diagram. The Tribunal accepted Mr Narayan's evidence that this had been orally agreed between Mr Narayan and Mr Saroya in February 2016. 2. The Tribunal arrived at these conclusions by the following steps: 1. The Tribunal preferred the evidence of Mr Narayan to that of Mr Saroya because it took the view it was logical and internally consistent, it was supported by the objective facts and Mr Saroya was an unimpressive witness, as also was Ms Gillet. It concluded that Mr Saroya's explanation of the payment of $10,000.00 was unconvincing. 2. The objective facts that supported Mr Narayan were that the Lessee had established blueberries on five acres, had cleared another five acres and, most significantly, the Lessee had paid $10,000.00 on signing the lease. 3. The written lease was prepared on instructions of the Lessee and, accordingly, must be construed in favour of the Lessor. The limited right of appeal 1. Since no error of law was raised by the appeal, and because this was an appeal from a decision of the Consumer and Commercial Division of the Tribunal, the Lessee needed to meet the requirements for the grant of leave to appeal set out in cl 12 of Schedule 4 of the Civil and Administrative Tribunal Act 2013 (NCAT Act). 2. That clause provides: 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). Grounds of appeal 1. There were three grounds of appeal, namely: 1. The decision was against the weight of the evidence. 2. The Tribunal failed to take account of relevant facts being that the appellant did not farm the second area of five acres at all. Additional relevant facts not taken account of were relied upon in submissions. As emerged from, at least, submissions this was a contention that the decision was not fair and equitable. 3. New evidence not reasonably available to the appellant consisting of an admission made in correspondence to the Lessee's then solicitor about outstanding rent. Extension of time for appeal 1. The Lessor opposed the grant of an extension of time in which to bring the appeal. They submitted that the appeal was hopeless, there were no reasons for the delay and it would be unjust to grant the extension. 2. We have decided that, pursuant to s 41 of the NCAT Act, the appellant should be granted the required extension of time – a period from the date of the hearing on 22 January 2019, at which oral reasons for decision were given by the Tribunal, until 22 March 2019 when the notice of appeal was lodged. The appellant had 28 days from 22 January 2019 in which to appeal because it was on that date that oral reasons for the decision were given: Rule 25(4)\(c) of the Civil and Administrative Rules 2014. 3. We think it is in the interests of justice that such an extension be granted, particularly, because of the reasonable explanation for the delay that came to be provided and the merits of the appeal: Jackson v NSW Land and Housing Corporation [2014] NSWCATAP 22 at [22]. 4. The Lessee was self-represented at the hearing at first instance. Promptly, after learning of the result, the Lessee sought legal advice from Mr James, who appeared for him on the appeal. By letter dated 24 January 2019, Mr James requested written reasons for the decision. These were supplied on 26 February 2019. The appeal was lodged within 28 days of the receipt by Mr James of those reasons. As appears from the reasons below, the appeal has substantial merit. 5. As to prejudice to the Lessor, there was no evidence of any specific prejudice. In addition, we note that within 28 days of the Tribunal's order the Lessee paid the Lessor the rent that he had been ordered to pay. The Lessee's (appellant's) submissions 1. Leaving aside for the moment the ground of appeal based upon new evidence, in written and oral submissions, Mr James for the appellant gave emphasis to the following matters that he said were established facts that were not taken account of by the Tribunal: 1. The written lease was prepared in the context where the only area cleared and planted by the Lessee was the five acres marked "C" on the diagram and no work had been done, or was done, or use made of the area marked "D" in the year to 30 June 2017. 2. In the circumstances, it made no commercial sense for the Lessee to agree to pay for an additional five acres of land that was not utilised in the first year of the lease. 3. The Lessee never went ahead and planted a crop on the second five acre area even after he had spent money clearing the area after June 2017. This made no sense if the agreement had been that he could have 10 acres for cropping. 4. The Lessor took no action to enforce an entitlement to rent for an alleged 10 acre lease until after the expiry of the second year of the lease on 30 June 2018 and after the time when the rent for the third year of the lease had not been paid on 1 July 2018. If the parties had agreed on a 10 acre lease the Lessor would have been expected to take the action they did take in July 2018 a year earlier in July 2017. This conduct was also consistent with Mr Saroya's evidence that the $10,000 payment he made in late 2016 was a payment of two year's rent. 5. The Lessor left unexplained the failure to take action for alleged default in payment of rent until July 2018. 6. It was plain that Mr Saroya was of the mind that he only owed $5,000 for the third year's rent of the five acres he had planted because this was what he paid in response to the July 2018 notice of termination and he would have been taking an extraordinary risk of losing his crop on that area if he paid less than he truly owed. The Lessor's (respondent's) submissions 1. Mr Bell, who appeared for the Lessor, did not dispute the existence of the established facts that Mr James relied upon but submitted that the Tribunal had resolved a difficult case involving a dispute as to what had been orally agreed in a conventional way, including by reference to objective facts. No error of law had been relied upon. The payment of $10,000 at the time the written lease was entered into was a strong factor in the Lessor's favour – it was not sensible for the Lessee to have paid that amount if the lease was only for five acres. 2. Mr Bell submitted that it could not be concluded that the weight of the evidence favoured the Lessee's case given the conflicting evidence and objective facts the Tribunal had relied upon. 3. Mr Bell submitted that another objective fact that was against the Lessee was that the second five acres had, in fact, been used by the Lessee by placing shipping containers on the area and for pickers parking. However, there was no finding by the Tribunal to this effect and Mr Bell was unable to demonstrate these contentions by reference to any evidence in the proceedings below, including photographs. Consideration – leave to appeal - objective facts disregarded 1. We do think that the Tribunal erred in its approach to fact finding by not grappling with the above established facts that provided considerable support for the Lessee's case. 2. It was an error not to do so and an error that went to the central fact in the case, namely what area had the parties verbally agreed should be the subject of the lease. 3. In our opinion, it was an error of such potential significance that the decision was not a fair and equitable one. We say this even though we are conscious of the conclusions that the Tribunal reached about the parties as witnesses. This is because the facts that the Tribunal did not address are capable of having a direct bearing upon whose version of the events is to be accepted. 4. For these same reasons, we think such error may have resulted in a miscarriage of justice. 5. Adding to our concern that there may have been a miscarriage of justice was the Tribunal's reliance upon the fact that the written lease had been prepared at the instigation of the Lessee. It seems to us that, assuming this was correct, it was of no consequence in attempting to resolve this particular dispute. 6. Furthermore, if there was a specific agreement in February 2016 that the area to be leased would be 10 acres, as Mr Narayan suggested, then it is, on the face of things, somewhat surprising that the written lease did not state this. The fact that it was expressed in the way it was may be more consistent with the Lessee's position that what was really agreed orally was that the rent would be $1,000 per acre for the area that was actually cultivated. 7. However, we are not in a position to arrive at a final conclusion about this central fact. 8. Nor do we go so far as to conclude that the decision was against the weight of the evidence. 9. In the circumstances, it is unnecessary for us to decide whether this factor had been established. However, to arrive at such a conclusion it would be necessary for us to come to the view that the evidence "in its totality preponderates so strongly against the conclusion found by the tribunal at first instance that it can be said that the conclusion was not one that that a reasonable tribunal could reach": Collins v Urban [2014] NSWCATAP 17 at 77 (2). We only remark that it would be difficult for such a conclusion to be reached on the material we have considered, albeit that this falls short of the totality of the evidence presented at first instance. 10. In Collins v Urban the Appeal Panel referred to the general principles concerning the grant of leave to appeal and said (at [84]): The general principles derived from these cases can be summarised as follows: (1) In order to be granted leave to appeal, the applicant must demonstrate something more than that the primary decision maker was arguably wrong in the conclusion arrived at or that there was a bona fide challenge to an issue of fact: BHP Billiton Ltd v Dunning [2013] NSWCA 421 at [19] and the authorities cited there, Nakad v Commissioner of Police, NSW Police Force [2014] NSWCATAP 10 at [45]; (2) Ordinarily it is appropriate to grant leave to appeal only in matters that involve: (a) issues of principle; (b) questions of public importance or matters of administration or policy which might have general application; or (c) an injustice which is reasonably clear, in the sense of going beyond merely what is arguable, or an error that is plain and readily apparent which is central to the Tribunal's decision and not merely peripheral, so that it would be unjust to allow the finding to stand; (d) a factual error that was unreasonably arrived at and clearly mistaken; or (e) the Tribunal having gone about the fact finding process in such an unorthodox manner or in such a way that it was likely to produce an unfair result so that it would be in the interests of justice for it to be reviewed, BHP Billiton Ltd v Dunning [2013] NSWCA 421 at [20] and the authorities cited there, SAB v SEM [2013] NSWSC 253 at [8] and [9] and the authorities cited there, Nakad v Commissioner of Police, NSW Police Force [2014] NSWCATAP 10 at [45]. 1. In our opinion, for the reasons already given, the decision was affected by the circumstance referred to in 2(c) of the above passage, namely an error that was plain and readily apparent, being a failure to grapple with and address the established facts to which we have referred, which error was central to the Tribunal's decision so that it would be unjust to allow the finding to stand. New evidence 1. At the hearing of the appeal a considerable amount of time was spent upon the ground of appeal based upon new evidence. The new evidence consisted of an email from the Lessor's then solicitor Mr Campbell to the Lessee's then solicitor Mr Flynn. It was sent on 15 August 2018. The email was sent after the Lessee had made the payment of $5,000.00 referred to above. Suffice to say that the email supported the Lessee's case. 2. The opening sentence of the email stated: I refer to your email sent yesterday and advise that you can assume that we can continue our correspondence on a without prejudice basis. 1. Part of the argument at the hearing of the appeal concerned whether the email could be regarded as "significant new evidence", as required, because it was contended that the relevant statement was made without prejudice as part of a mediation process. Section 131 of the Evidence Act and the common law with respect to without prejudice privilege were referred to. Mr James made reference to the fact the Tribunal is not bound by the rules of evidence. 2. It is unnecessary for us to arrive at any conclusion about this aspect of the argument because we are satisfied that the Lessee has not met the requirement that he establish that the evidence was not reasonably available at the time of the hearing at first instance: see cl 12(1)(c). 3. The email was sent to the Lessee's solicitor (Mr Flynn, from a different firm than Mr James' firm) well before the hearing on 22 January 2019. We appreciate that this solicitor did not appear for the Lessee at the hearing on 22 January 2019 – on that occasion Mr Saroya was unrepresented. Nevertheless, Mr Flynn was acting for the Lessee up until, at least, about 19 November 2018 and was involved in the preparation of the material that the Lessee would rely upon in both proceedings, including the Statutory Declaration by Mr Saroya made on 15 November 2018 which, amongst other things, addressed the issue as to the area that it was agreed would be leased. 4. In these circumstances, we do not accept that the email was not reasonably available to the Lessee at the time of the hearing at first instance. Orders 1. For the above reasons, we make the following orders: 1. Pursuant to s 41 of the NCAT Act, extend the time for lodging the appeal to 22 March 2019. 2. Grant leave to appeal. 3. Allow the appeal. 4. Set aside Order 1 made on 22 January 2019 in proceedings COM 18/48366, namely the order that "the respondent is to pay the applicant the sum of $15,000 in respect of unpaid rent on or before 22 March 2019". 5. Remit to the Tribunal for redetermination by a differently constituted Tribunal the Lessor's claim in proceedings COM 18/48366 for Order 3 (an order that the new lease states the area leased as 10 acres as per verbal agreement) and Order 6 (an order that rent due up to 30 June 2019 in the amount of $15,000.00 be paid). ********** 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: 16 September 2019