Geoff Conway v Clarke Traeger

[2014] NSWCATCD 175

NSW Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation:	Geoff Conway v Clarke Traeger and Ors [2014] NSWCATCD 175
Hearing dates:	21 August 2014
Decision date:	19 September 2014
Before:	J. Lynch, General Member
Decision:	1.The fourth respondent Clarke Traeger is to pay the applicant Geoff Conway the sum of $6133.89 on or before 24 September 2014.
Catchwords:	None
Legislation Cited:	Consumer Claims Act 1998 , Civil and Administrative Tribunal Act 2013, Competition and Consumer Act 2010 Schedule 2 Civil Liability Act 2002
Category:	Principal judgment
Parties:	Geoff Conway (applicant) self represented Riverina Solar Energy Systems (1st respondent) no appearance Cooper Contracting Pty Ltd (2nd respondent) no appearance I and V Cooper Contracting Pty Ltd (3rd respondent) represented by Clarke Traeger Clarke Traeger (4th respondent) self-represented
File Number(s):	GEN 13/49909
Publication restriction:	Unrestricted

reasons for decision

1. The applicant Geoff Conway ("the consumer") purchased a 3.2 Conenergy solar PV system from the fourth respondent Clarke Traeger ("the trader"). The claim against the first respondent Riverina Solar Energy Systems and the second respondent Cooper Contracting Pty Ltd are dismissed as at the hearing the fourth respondent stated that these entities are non-existent which was confirmed by searches. The third respondent I and V Cooper Contracting Pty Ltd was represented at the hearing by Mr Clarke Traeger pursuant to written authority from the Director Colleen Neil. The consumer claimed the sum of $6899.49 for losses he contends he suffered due to misrepresentations from the trader or alternatively the sum of $18007.49 being the cost of removing the system.

Jurisdiction

1. The Tribunal has jurisdiction to determine the claim under section 3A Consumer Claims Act 1998 and Civil and Administrative Tribunal Act 2013.No issue was raised at the hearing regarding jurisdiction.

Application

1. The applicant contends that he purchased the system relying on the trader's representation that he would save a certain amount per quarter and accordingly the system would pay for itself within a period of seven years based on those savings and that this has not eventuated resulting in a loss to him. The consumer paid $5918 at the trader's request plus installation costs $2805 in accordance with the quote provided by the trader for $8723.The trader states that he had no intention to deceive and the figures provided by him to the consumer were just an example and subject to variations from the energy suppliers. "Savings were effected by the way the energy authorities charge".

1. The parties were given the opportunity to resolve or narrow the issues by utilizing the resolution process of conciliation on a number of occasions including 28th May 2014 and the day of the hearing but were unable to reach a mutually agreeable settlement. It was common ground that there was no issue with the installation.

1. The parties exchanged documentary evidence relied upon and the applicant tendered at the hearing documents produced under Summons from Mr Tancredi. A copy of these documents was supplied to the trader by the Tribunal as he had not availed himself of the opportunity to obtain a copy from the Registry prior to the hearing. The Tribunal has considered all the written material submitted by each party as set out in Schedule 1.

1. The consumer Mr Conway gave oral evidence and called Mr Tancredi the installer. The trader Mr Traeger gave oral evidence. Both parties were asked and confirmed they were ready to proceed with all available evidence at the hearing on 21 August 2014. The applicant and fourth respondent appeared in person. The consumer was supported by his wife who was present at the hearing. The consumer provided a written submission prepared by Legal Aid NSW.

Whether the trader represented that he was selling a solar system on behalf of Electrical Trade Services

1. The consumer gave evidence that the trader stated to him that he worked for ETS and the consumer who is blind caused his wife to check this business in the phonebook. In fact the Tribunal finds on the evidence of Mr Tancredi for the consumer and Mr Traeger that at the time of providing a quote to the consumer Mr Traeger had no authority to act on behalf of the business ETS and did so on his own behalf. In his written statement Mr Traeger states "I sold the system to him." He also stated he had no specific authority to provide a quote on behalf of I and V Cooper Contracting Pty Ltd to the consumer. The Tribunal accepts the evidence of Mr Conway that the quote (Annexure A to the application) was read to him without the details of the three different names ascribed on it.

The names included were:-

(i)   Cooper Contracting Pty Ltd- the trader stated this was a shorter version of the company name (I and V Cooper Contracting Pty Ltd) This was at the top of the letterhead.

(ii)   Solar Energy Systems Riverina The trader stated this was not put on the letterhead as the name of a company but as a slogan. When it was put to him that it looks like a registered business name he couldn't agree it did

(iii)   I and V Cooper Contracting Pty Ltd. This was written in smaller print at the foot of the quote.

1. Mr Tancredi gave evidence that the quote document which he sighted that was provided by Mr Traeger to Mr Conway was in the same form as one used by his business ETS and had been altered by Mr Traeger changing the letterhead by referring to the three different entities. Otherwise the format of the document was the same as that used by Mr Tancredi's business Electrical Trade Services (ETS.)

1. The Tribunal finds that the contract was formed between Mr Traeger and Mr Conway when Mr Conway accepted the terms of the proposal read to him by Mr Traeger in the document referred to in paragraph 11 below. Mr Conway intended to deal with the person in front of him Mr Traeger. It was after acceptance and formation of the contract that Mr Traeger first mentioned Cooper Contracting Pty Ltd to the consumer by requesting that the deposit cheque be made out in that name. The Tribunal finds on the evidence that the contract was formed between Mr. Traeger personally and Mr Conway.

1. On the day the quote was provided Mr Traeger was not representing ETS although he was a part time employee for that business it was his day off. Mr Tancredi's evidence makes it clear and it is not disputed by Mr Traeger that at the time he provided the quote he was not doing so in his capacity of employee for ETS. Accordingly it was a misrepresentation for him to assert to the consumer Mr Conway that he represented the business ETS in the work he performed for him.

Whether the trader represented that the system would save the consumer an average of $408.80 per quarter

1. Annexure A to the application states:

"Proposal for the Supply and Install of a 3.2kw Solar PV system for Geoff Conway

This is a proposal for is for the supply and installation of a 3.2kw Conenergy solar PV system designed to generate approximately 17kw of power per day. This equates to approximately $4.48 per day (based on 28 cents per kilowatt hour) of electricity saved. Over the quarter it will save the customer an average of $408.80 per quarter of nearly $1635.20 per year.

Redeeming period =5.3 years.

Without allowing for increase in energy cost payoff will be less than 7 years meaning that in 7 years the customer will have saved in his electricity bill the cost of this system. Please note that these figures are based upon the regions average of 5 hours of sunlight per day. Should you average more sunlight hours over a twelve month period you will produce more electricity thus saving you more money and reducing your redeeming period."

1. The consumer gave evidence that he provided Mr Traeger with 4 accounts representing normal use of the home (prior to the period when it was unoccupied due to flooding).Mr Traeger returned a few days later with the proposal and based on the figures contained in the quote (referred to as a proposal set out in para 11 above). The Tribunal is satisfied that the consumer decided to purchase the system and in doing so he relied upon the trader to provide an accurate proposal based on the information provided and his expertise and knowledge of the system .The consumer is a pensioner and Mr Traeger was aware that he was purchasing the system based on the stated savings it would achieve. In fact Mr Traeger was aware that the consumer's aim originally was to reduce his electricity bill to zero although this goal was unattainable. The use of the words in the proposal:-" Over the quarter it will save the customer an average of $408.80 per quarter or nearly $1635.20 per year." led the consumer to purchase the system relying on the stated savings.

1. The evidence of Mr Tancredi supports the consumer's case as he concludes:-

"the credits per quarter don't eventuate. "

He attributed this partly to the trader using an incorrect figure of 28c per kilowatt hour in lieu of the correct figure at the time of 8c for AGL and 6c for Origin/Essential Energy.

1. The trader on the other hand contends that the proposal was just an example and that ETS had used the figure of 28 cents for some time. This was not put by Mr Traeger to the owner of ETS Mr Tancredi and Mr Traeger presented no evidence to support this claim whatsoever. He further contended that the proposal had been misinterpreted but failed to indicate in what manner.

1. In his statement Mr Traeger said:-"Most consumers relate to power consumption in terms of dollars and cents I used a nominal 28 cents per kilowatt hour to demonstrate possible savings."

He also stated in evidence: - "What is reflected in the document is pretty much what we talked about

Secondly Mr Tancredi stated that the placement of the panels on the west rather than the north would have impacted the quote by probably 10 per cent as there was less sunlight hours in that location. He stated if he was quoting he would definitely have varied the quote from a 5 kilowatt hour average by adjusting it down to take into account the location. The Tribunal finds that although Mr Traeger was aware of the westerly location for the panels due to available space he did not factor the change in sunlight hours in to the quote either.

1. The Tribunal finds the trader made a false and misleading representation concerning the performance characteristics of the system as to the savings it would achieve and his affiliation with ETS in breach of section 29 Australian Consumer Law. The statements made to the consumer orally and replicated in the written proposal to the consumer also constitute misleading and deceptive conduct in breach of section 18 Australian Consumer Law. The statement made by him in the written proposal and orally in the course of selling the system actually misled the consumer to purchase the system. The statement that the trader represented ETS gave the consumer confidence that the trader was in the business of providing an accurate proposal calculating the savings. The Tribunal finds that the statements by the trader about the quantity of electricity which would be generated and consequent savings which would be achieved were made without reasonable grounds. After consideration of the evidence from both parties the Tribunal is not satisfied that the conduct complained of also constituted unconscionable conduct in the circumstances.

Assessment of loss

1. Australian Consumer Law section 236 entitles a person who suffers loss or damage because of the conduct of the other person and the conduct contravened as in this case sections 18 and 29 to recover the amount of loss or damage. The consumer claims financial loss. The savings in the proposal compared to what actually occurred has been measured in terms of the savings to the consumer based on firstly the buy back and secondly the electricity generated which was used at no charge by the consumer. The basis for these calculations has been determined using inverter readings taken by the consumer's wife from the system within a day or two of the meter reading by the electricity supplier. The method for calculating the actual savings was to calculate the energy produced over the quarter by comparing the inverter readings at the beginning and end of the quarter and then deducting the number of kilowatts that the energy company bought back. The difference between these two figures provides the energy used by the consumer and this was calculated as a saving by multiplying by the rate charged for power on the quarterly bill. The amount saved by using energy at no charge plus the buyback rebate give the total savings for the quarter. This method was approved by the consumer's witness Mr Tancredi who as a licensed electrician for 30 years and licensed Clean Energy Council installer for three years is qualified to read the figures and advise on their interpretation and savings. The trader Mr Traeger was asked if he had any objection to the method of calculation of savings and he did not. No questions were put by him to the consumer or installer about the calculation of electricity savings from the primary evidence. Although Mr Traeger in his statement raised the variations in electricity service fees this was not pressed by him at the hearing and is not relevant to the consumer's claim which is based on the power generated savings and buybacks and doesn't take into account any variations in electricity service charges. There was no evidence from the trader disputing the quantum of the consumer's claim. The method was then applied to the remaining periods for which figures were submitted by the consumer.

1. Applying the calculation to the accounts provided in evidence :

(1)   Billing quarter July-October 2013 (accounts numbered page 23 and 24 of evidence). The inverter readings were 3563 and 4338 (Pages 16 and 17 of the consumer's records) producing 775 kilowatts of energy in the quarter less buyback of 522 makes 253 kilowatts used without charge. The rate for this quarter was 32c which comes to $80.96 (253kw x 32c) The rebate credit on the bill was $41.76 plus $80.96 equals a saving for the quarter of $122.72

(2)   Billing quarter April - July 2013 (accounts numbered page 17 and 18 of evidence) The inverter readings were 3225 and 3563(Pages 14 and 16 of the consumer's records) producing 338 kilowatts of energy in the quarter less buyback of 178 makes 160 kilowatts used without charge. The rate for this quarter was 31c which comes to $49.60 (160kw x 31c) The rebate credit on the bill was $14.24 plus $49.60 equals a saving for the quarter of $63.84

(3)   Billing quarter January-April 2013 (accounts numbered page 15 and 16 of evidence). The inverter readings were 2313 and 3225 (Pages12 and 14 of the consumer's records) making 912 kilowatts of energy produced in the quarter less buyback of 554 makes 358 kilowatts used without charge. The rate for this quarter was 31c which comes to $110.98 (358kw x 31c). The rebate credit on the bill was $44.32 plus $110.98 equals a saving for the quarter of $155.30. For the preceding billing period November to January the account was from Country Energy/Origin rather than AGL and did not provide the same detail as for billing periods 1-3 above such as buy back amounts which was provided on the AGL accounts. In fact Mr. Culgan in a statement for the trader states "your primary energy supplier at the time ... do not offer solar."

1. So for the 9 month period January to October 2013 the consumer has provided evidence of savings of $341.86 ($122.72+$63.84+$155.30). As the figure of $4.48 per day of electricity saved is expressed as an approximate figure in the proposal ('approximately $4.48 per day") it follows that the figure is subject to some variation. The Tribunal considers that for an approximate figure that a variation of plus or minus 10% would be a percentage which would be acceptable given the language used in the proposal which was accepted by the consumer. (Including "approximately" and "nearly") Comparing the savings of $341.86 to $1103.76 (the quarterly promise of $408.80 x3 $1226.40 less 10%) represents a loss of $761.90

1. Three further quarters have elapsed since the application was filed till the date of the hearing between October 2013 to July 2014 the figure of $761.90 represents the estimated loss on the figures previously referred to from the primary evidence submitted.

1. The consumer claims an ongoing loss to cover the period of seven years in total as the proposal is stated to cover payoff of the system within that timeframe. The loss of $761.90 for three quarters equates to $19.53 per week. ($761.90 divided by 39 weeks) .As this future weekly loss for the ensuing 5 years is to be paid as a lump sum the provisions of the Civil Liability Act apply.

Section 14 provides:-

Damages for future economic loss-discount rate

14 Damages for future economic loss-discount rate

(1) If an award of damages is to include any component, assessed as a lump sum, for future economic loss of any kind, the present value of that future economic loss is to be determined by adopting the prescribed discount rate.

(2) The "prescribed discount rate" is:

(a) a discount rate of the percentage prescribed by the regulations, or

(b) if no percentage is so prescribed-a discount rate of 5%.

1. The consumer is assessed on the evidence presented to the Tribunal to suffer a future loss of savings of $19.53 per week for five years. The loss is calculated at $19.53 x 231.5 (5% weekly multiplier for 5 years) =$4521.19

The consumer is entitled to be placed in the position he would have been in if he had not been misled by the trader. The sum which places him in this position is assessed at $6044.99 ($761.90 +$761.90+$4521.19).

Costs

1. The consumer applied for costs in the sum of $206.78. Section 60(1) Civil and Administrative Tribunal Act provides that each party is to pay the party's own costs. The Tribunal considers that this provision should apply to the costs claimed of phone calls, and postage costs.

The Tribunal considers that special circumstances exist in the way the proceedings were conducted that warrants a partial award of incidental costs. The Tribunal has also considered the nature of the proceedings. In the exercise of the discretion in section 60 (2) the sum of $88.90 is allowed being:-

(i)    $42 fee for issue of Summons

(ii)    $28.90 fee for ASIC search

(iii)    $18.00 fee to NCAT for copying Summonsed documents

It became necessary for the consumer to call the installer and seek documents from him as the trader's statement (page 7 of attachment to application) was nebulous about his involvement with the transaction and the trader conducted proceedings in a way that disadvantaged the consumer by only revealing at the hearing after several directions hearings that Riverina Solar System and Cooper Contracting were non-existent after the consumer had expended money in searches with ASIC.

1. The fourth respondent Clarke Traeger is to pay the applicant Geoff Conway the sum of $6133.89 on or before 24 September 2014. All other claims are dismissed.

SCHEDULE 1

Applicant's documents

(1)   Application dated 10 September 2013

(2)   Letter to Legal aid Officer (page 1-2 Annexure A)

(3)   Proposal (Page 3 Annexure A)

(4)   Cooper Contracting Tax Invoice 169 27 June 2012 (page 4 Annexure A)

(5)   Letter to Fair Trading 11th June 2013 (page 5-6 Annexure A)

(6)   Letter from Clarke Traeger 22 March 2013 (page 7 Annexure A)

(7)   Letter to Mick 12th July 2013 (page 8 Annexure A)

(8)   Emails between Electrical Trade Services and applicant (page 9-10 Annexure A)

(9)   Letter Electrical Trade Services Pty Ltd (page 11 Annexure A)

(10)   Letter Friedlieb Byrne Solicitors 23 July 2013 (page 12 Annexure A)

(11)   Copies postal receipts (page 13-14 Annexure A)

(12)   Copy Cheque Butt dated 13-6-12 (page 15 Annexure A)

(13)   List of phone calls(page 16-18 Annexure A)

(14)   Particulars of claim dated 10 September 2013 (page 19 Annexure A)

(15)   TJ and DJ Van Lierop Quote for disconnect and remove solar unit dated 1/9/13 (Annexure B)

(16)   Alternative claim details 10/9/13

(17)   Letter to Tribunal 14 November 2013 enclosing documents

(18)   Electricity Invoices dated 27/1/11 to 23/10/13 numbered 1-24.

(19)   Handwritten recordings of meter readings and solar inverter unit readings from 7/8/12 to 25/10/13 numbered 1-17

(20)   Applicant's Submission from Legal Aid NSW pages 1-5

(21)   Statement of Michael Tancredi dated 25/11/13

(22)   Letter enclosing further documents dated 27/3/14

(23)   Business name Search of Riverina Solar Systems

(24)   Business Name Search of Cooper Contracting

(25)   Copy cheque dated 13-6-12 and bank details

(26)   Statutory declaration of Geoffrey David Conway sworn 27/3/14 (4 pages)

(27)   Photographs numbered 1-10

(28)   Statement of Michael Tancredi West Wagga Electrics dated 10 July 2014(2 pages)

(29)   Notification of Service work Certificate 101447

(30)   Certificate of Compliance- Electrical Work 333067307

(31)   Notification of Service Work 101447

(32)   Electrical Work Certificate to customer

(33)   Work Hazard Risk report 2432

(34)   Electrical Trade Services Pty Ltd Tax Invoice dated 26/6/2012

(35)   Electrical Trade Services Job Sheet

(36)   List of costs (3 pages)

(37)   Registered post copy receipts

(38)   Invoice from Creditor Watch for ASIC searches 27/3/14

(39)   Cheque butts for photocopying and Summons fee to NCAT

(40)   Handwritten submission (2 pages)

Fourth Respondent's Documents

• A.Mike Culgan response to Mr. Conway dated 18/12/13
• Statement of Clarke Traeger 18/12/13 (5 pages)
• Statutory declaration of Clarke Traeger dated 28 April 2014 (4 pages) with 2 energy accounts attached

J Lynch

General Member

Civil and Administrative Tribunal of New South Wales

19 September 2014

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

Decision last updated: 20 November 2014