Goh v Kabadanis (Appeal)
[2024] ACAT 54
•7 August 2024
ACT CIVIL & ADMINISTRATIVE TRIBUNAL
GOH v KABADANIS (Appeal) [2024] ACAT 54
AA 45/2023 (XD 1179/2021)
Catchwords: APPEAL – civil dispute – contract for converting existing pergola to a sunroom – whether the original tribunal erred by considering claim by reference to amount claimed – whether the original tribunal erred in its consideration of terms of the contract regarding timeliness and adherence to “Australian standards” – whether the original tribunal erred in its consideration of claimed failure to provide services with due care and skill – whether the original tribunal erred in rejecting claim respondent repudiated the contract by conduct – whether original tribunal erred in rejecting claimed breaches of the Australian Consumer Law – whether original tribunal erred in its consideration of opinion evidence regarding defects in work done at the time the contract ended – whether original tribunal erred in its consideration of charges for materials and labour – no error proved – appeal dismissed
Legislation cited: ACT Civil and Administrative Tribunal Act 2008 ss 79, 82
Australian Consumer Law ss 18, 60, 101
Planning and Development Act 2007 s 205
Cases cited:Giusida Pty Ltd v Commissioner for ACT Revenue [2016] ACTSC 275
Goh v Kabadanis [2023] ACAT 80
ISPT Pty Ltd and Commissioner for ACT Revenue [2013] ACAT 43
Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd [2007] HCA 61
LP 202012 (Hugh Ford) v Council of The Law Society of the ACT [2024] ACAT 12
Legal Practitioner v Council of Law Societyof the ACT [2011] ACTSC 207
Swift v Wearing-Smith [2016] NSWCA 38
Thornthwaite and the Commissioner for Social Housing for the ACT [2012] ACAT 11
Tramways Advertising Pty Ltd v Luna Park (NSW) Ltd (1938) 38 SR (NSW) 632
Wearing-Smith v Swift [2014] NSWDC 159
Tribunal:Presidential Member G McCarthy
Member W Hawkins
Date of Orders: 7 August 2024
Date of Reasons for Decision: 7 August 2024
Date of Publication: 14 August 2024
AUSTRALIAN CAPITAL TERRITORY )
CIVIL & ADMINISTRATIVE TRIBUNAL ) AA 45/2023
BETWEEN:
MICHAEL GOH
Appellant
AND:
PETER KABADANIS
Respondent
TRIBUNAL:Presidential Member G McCarthy
Member W Hawkins
DATE:7 August 2024
ORDER
The Tribunal orders that:
The appeal is dismissed.
………………………………..
Presidential Member G McCarthy
For and on behalf of the Tribunal
REASONS FOR DECISION
This appeal arose from a decision of the tribunal (the Original Tribunal) finding the respondent should pay the appellant $1,145 by way of a determination of a dispute between the parties about construction works done or to be done by the respondent to convert the appellant’s existing deck and pergola at their home into a sunroom with a roof, walls, windows and door.[1] Where the respondent had earlier paid the money, no further order requiring payment was made and the application was therefore dismissed.
[1] Goh v Kabadanis [2023] ACAT 80
The appellant appealed on many grounds, some of which were repetitive of earlier grounds, but which resolved to the grounds we deal with below.
Before doing so, it is important to note the nature of an appeal and the role we had on appeal.
The appellant appealed pursuant to section 79 of the ACT Civil and Administrative Tribunal Act 2008 (the ACAT Act), which entitles a party to the original application to appeal “on a question of fact or law”.
Pursuant to section 82(1) of the ACAT Act, the appeal tribunal is able to deal with the appeal as a new application or as a review of all or part of the original decision as it considered appropriate. In this case, the Appeal Tribunal ordered the appeal proceed as a review of the original decision. In Legal Practitioner v Council of Law Societyof the ACT, the Supreme Court per Refshauge J commented that the phrase “review of all or part of the original decision” should be understood as what is usually called a “rehearing”.[2]
[2] [2011] ACTSC 207 at [13]-[14]. See also Giusida Pty Ltd v Commissioner for ACT Revenue [2016] ACTSC 275 at [37]
In LP 202012 (Hugh Ford) v Council of The Law Society of the ACT,[3] the appeal Tribunal said:
32. The Appeal Tribunal’s role on an appeal conducted by way of a rehearing is well settled. The principles were set out by President Neate in V v Elringtons Pty Ltd …
33. In short, the practitioner must show that the original tribunal made an error of fact or law and that the error material[ly] affected the result…
34. In Harada v Barnes, the Tribunal said:
The onus is on an appellant to show, specifically, where the original tribunal went wrong. Normally, that requires an appellant to point to an error of fact or an error of law in the written or oral reasons for decision of the original tribunal and to explain to the appeal tribunal how that error affected the result.[4]
[3] [2024] ACAT 12
[4] [2024] ACAT 12 at [32]-[33]
Put another way, in Thornthwaite and the Commissioner for Social Housing for the ACT, the ACT Civil and Administrative Tribunal (the ACAT) on appeal said:
54. The general rule on appeals is that an appeal court, or an appeal tribunal in this instance, will be reluctant to interfere with the order of a lower court or tribunal unless there is some manifestly obvious error made which, if it was not rectified, will have a substantive bearing – an adverse bearing – on the case – an adverse bearing that would not be in the interests of justice if it were allowed to stand.
55. It basically means that if the tribunal below got a few little things wrong but the order fundamentally was sound, then it is not going to be interfered with.[5]
[5] [2012] ACAT 11, at [54]-[55]
In ISPT Pty Ltd and Commissioner for ACT Revenue, the ACAT on appeal re-iterated what it had earlier said, and added:
An Appeal Tribunal will also look at whether the decision of the tribunal below was a decision that was open for it to make on the facts before it. It is within these parameters that this Appeal Tribunal will operate.[6]
[6] [2013] ACAT 43 at [12]-[14]
It is within this framework that the appeal must be determined.
In the original proceeding, the Original Tribunal gave oral reasons for its decision on 6 October 2023. Those reasons, with slight amendments of grammar or expression, were subsequently provided in written form and published.[7] Whilst the appellant appealed by reference to the oral reasons, which we have considered in relation to each ground of appeal, for reasons of transparency we have referred to the equivalent passages in the Original Tribunal’s published decision.
Ground 1: use of a website to identify the respondent
[7] Goh v Kabadanis [2023] ACAT 80
The appellant submitted the original Tribunal was wrong in fact to say he and his wife used a website to identify the respondent as someone able to do the work at a price that suited them. He said the respondent came as a representative of Spectrum Painting Services P Kabadanis Pty Ltd (Spectrum), a business owned by the respondent’s grandfather who shares his name.
In our view, whatever capacity the respondent responded, it made no difference to the outcome because, by order made on 6 May 2022, Spectrum was removed as a respondent to the appellant’s claim in the proceeding and the respondent, personally, continued as the respondent to the appellant’s claim.
In other words, the respondent personally was responsible for the work done and any liability found in response to the appellant’s claim. Ground 1 fails.
Ground 2: claim limited to $14,999
The appellant referred to his project cost determination methodology as evidence of the project cost for the original pergola and deck and the determined cost of the sunroom to a total of at least $39,515. The Original Tribunal noted the appellant’s claimed losses were over $39,000 but he limited his claim for compensation to $14,999.[8]
[8] [2023] ACAT 12 at [10]
On appeal, the appellant noted the ACAT’s jurisdiction is limited to $25,000 and therefore said that, if successful, his claim should be capped at $25,000.
As mentioned above, an appeal is not an opportunity for the appellant to re-run his claim. It is for the purpose of determining whether there was error, as alleged. In this case, as the Original Tribunal noted, the appellant’s claim was for $14,999. There was no error in the Original Tribunal proceeding by reference to the amount claimed.
In any event, even if the appellant had claimed the jurisdictional limit ($25,000) it made no difference to the result because the Original Tribunal found the respondent liable to pay the appellant $1,145 which was well within his claim. Ground 2 fails.
Ground 3: Australian standards
The contract between the parties was in the form of the text message from respondent sent on 11 January 2021 in which he set out the work to be done for a price of “$14,000 cash”. The closing line of the text message read “Works will be done to Australian standards”.
At the original hearing, much debate occurred about what should be understood by the words “Australian standards”, whether those words constituted an essential term of the contract and whether the respondent breached the term.
The Original Tribunal made no finding as to whether it was an “essential term” but accepted “both sides saw [the] term as centrally important, at the very least”.[9] However, nothing turned on the character of the term because the Original Tribunal was not persuaded it had been breached. The Original Tribunal referred to the uncertainty as to what was intended by the words “done to Australian standards”. It acknowledged one option was the work be done to the standards published by Standards Australia relevant to the construction of a sunroom. Another was that the work be done to standards accepted in the construction industry as “good Australian practice, method and quality”.[10]
[9] [2023] ACAT 80 at [46]
[10] [2023] ACAT 80 at [48]
The Original Tribunal noted neither party advanced any persuasive evidence to help answer the question or, whichever option was preferred, evidence to show the term had been breached. It acknowledged the comment of Mr Broadhurst, a registered Class A builder, in his building inspection report, in relation to a piece of timber on top of the header that the work was “non-standard”, but the comment did not assist the Original Tribunal to know why it was non-standard. For example, there was no reference to any standards issued by Standards Australia that had been breached. There was also a problem that the work had not been completed at the time the contract was brought to an end. In other words, as the Original Tribunal noted, it was difficult to establish whether an Australian standard have not been met “when the work that had been done was preparatory rather than final”.[11]
[11] [2023] ACAT 80 at [54]
On appeal, the appellant made many complaints.
First among them was about the respondent’s use of a timber joist taken from the demolished pergola and deck, not a metal joist (they say) he promised. At hearing, the respondent claimed that use of a timber joist was in accordance with Australian standards. For the Original Tribunal, the difficulty was the absence of evidence to determine the complaint. As the Original Tribunal pointed out during the hearing, when asked what Australian Standards he was referring to, the appellant was unable to identify which standards he claimed been breached let alone tender them and point to the ways in which the project had failed to meet them.[12]
[12] [2023] ACAT 80 at [49]
On appeal, the appellant repeated his claim that a metal joist should have been used because “to me Australian standard is about work done to an acceptable level/acceptable quality level and also about safety”.[13] He complained the Original Tribunal did not accept his viewpoint, but that does not prove error on the part of the Original Tribunal by not concluding, on the evidence before it, that a metal joist was necessary. As the Original Tribunal pointed out, the appellant “is not an expert on construction of sunrooms”[14] and the appellant does not point to any evidence as to why a metal joist was required. And, as the Original Tribunal pointed out, how could it find the respondent failed in some respect regarding the joists (or the stumps) when it was still possible at the time the contract ended for the work to be undertaken.[15]
[13] Appellant's written submissions in response to order 1B at [14]
[14] [2023] ACAT 80 at [51]
[15] [2023] ACAT 80 at [64]
The appellant complained, on appeal, that the Original Tribunal should have asked the respondent to define the term “Australian standards”. We disagree. It is not for the Original Tribunal to ‘enter the fray’ save for clarifying issues or evidence by reference to the manner in which they are put. Certainly, we see no error on the Original Tribunal’s part by not questioning the respondent about whether a metal joist was required by the Australian Standards.
We see no error in the Original Tribunal concluding it was not possible to find the respondent had breached the term in the contract requiring work to be done to Australian standards where there was no evidence as to what that meant or in what way it had been breached, whatever it meant, where the work was still unfinished. As Mr Broadhurst noted in his building inspection report –
Please note that the works are not finished. Further, when building, it is not uncommon to find mistakes and fix them before the project is complete.
Ground 3 fails.
Ground 4: due care and skill
An important part of the appellant’s claim in the original hearing was that the respondent had failed to provide his services with due care and skill in breach of section 60 of the Australian Consumer Law (ACL). The appellant relied on the inspection report provided by Mr Broadhurst to allege at least five material failures as noted and addressed by the Original Tribunal in its published reasons for decision.[16]
[16] [2023] ACAT 80 at [57]
The Original Tribunal noted the respondent did not quarrel with the claimed defects. Rather, the respondent said the work was incomplete at the time the contract was brought to an end and all of the defects would have been fixed or dealt with at a later stage had the contract continued.[17] The Original Tribunal concluded the respondent’s defences “are not unreasonable” and then went on to address “wider questions” about the need for approval for the project, the prospect of retrofitting stumps and a metal joist and the adequacy of the existing footings.[18]
[17] [2023] ACAT 80 at [58]
[18] [2023] ACAT 80 at [61]-[67]
In relation to approval, the Original Tribunal did not find the respondent to be in breach because he was not engaged as a project manager “but simply to construct a sunroom”.[19] As for retrofitting stumps and a metal joist and the adequacy the existing footings, the Original Tribunal was not prepared to find the respondent to be in breach because the stumps and joists were yet to be included in the structure when the contract ended and could have been later included. As for the adequacy of the footings, which seemed “to call the entire project into question”[20], the Original Tribunal was not prepared to make a finding of breach where it was not pressed by the appellant at the original hearing; there was doubt about whether it fell within the terms of the contract; the evidence of Mr Broadhurst on the point was no more than “a few lines in his brief report”; and Mr Broadhurst was not called as a witness or questioned.[21]
[19] 2023] ACAT 80 at [61]
[20] 2023] ACAT 80 at [65]
[21] 2023] ACAT 80 at [67]
On appeal, the appellant repeated his claims about why the work was defective and what was necessary, for example the use of DuraGal galvanised steel framing, The appellant debated the respondent’s methodology by laying the structural floorboard before retrofitting stumps and joists but did not engage with the Original Tribunal’s reasoning for rejecting the claim.
On the question of the Original Tribunal’s reliance on the circumstance that the work was unfinished, the appellant relied on his milestone payment to the respondent to contend the work referenced to a milestone payment must be complete. In this respect, the appellant referred to the contract which required a 50% deposit “before start of work” ($7,000) and “$3500 deposit required after pergola and timber frames are up”.
We were not persuaded by the appellant’s ‘milestone payment’ argument.
At the original hearing, the appellant referred to his milestone payment (characterised by the respondent as a progress payment)[22] but the Original Tribunal noted the respondent’s evidence that the payment was referenced to progress, not that the work was complete.[23] In other words, whilst a milestone or progress payment might, in a different contractual structure, entail payment by reference to work done that is complete, we were not persuaded the Original Tribunal erred by not taking that approach in this case. On the evidence, in this very simple contract, it was open for the Original Tribunal to conclude the second payment of $3,500 was simply a payment by reference to progress without an additional implication that the work to that point was complete.
[22] Transcript of proceeding, 5 September 2023, page 50, line 27
[23] Transcript of proceeding, 5 September 2023, page 50, line 23 – page 51, line 45
In any event, we find the argument unpersuasive. The initial payment of $7,000 cannot be regarded as a milestone payment: it was required before work even began. The second payment of $3,500 was “required after pergola and timber frames are up”, but that had no material bearing on the completion of other works which, the respondent said, could have been retrofitted. Ground 4 fails.
Ground 5: repudiation
The Original Tribunal dealt at length with the question: how did the contract end? It noted the evidence on this subject to be “unsatisfactory” but concluded from the text exchanges between the parties between 12 and 15 February 2021, when the parties were discussing costs of work done to date and the respondent was making an offer of settlement, that the contract had ended by at least 15 February 2021.
The Original Tribunal considered four possibilities as to how the contract ended, who ended it and why it ended. It arrived at a conclusion it “ended by mutual agreement or abandonment-that is, on a basis in which neither party is at fault.”[24]
[24] [2023] ACAT 80 at [41]
On appeal, by reference to the respondent “using milestone payments”, the appellant complained about the respondent having an obligation to provide a checklist for every stage of work completed to check for defective work and to remedy it before going to the next stage of work and that this service was not provided. The appellant complained about the respondent not using his time wisely to remedy the defects, and contended that if he had done so, the respondent (and the project) “would not have ended up this way”.[25]
[25] Appellant's written submissions in response to order 1B at [37]
As best we could tell, this seemed to draw on the appellant’s admission that he brought the contract to an end once he could see the respondent was not going to do any more work.[26]
[26] [2023] ACAT 80 at [40]
The problem with this ground of appeal, not addressed by the appellant, is the Original Tribunal’s consideration about the respondent providing a work plan and concluding that him doing so was not a term of the contract.[27] In other words, whatever the appellant might say about the respondent having an obligation to provide a checklist and then to remedy defective work by reference to it, he does not point to anything to show the respondent had a contractual obligation to do so nor respond to the absence of such an obligation. Where we see no error in the Original Tribunal’s analysis for why there was no such obligation, ground 5 fails.
Ground 6: Australian Consumer Law
[27] [2023] ACAT 80 at [39]
The appellant alleged the respondent breached three sections of the ACL: section 18 (engaging in misleading or deceptive conduct), section 60 (breaching a guarantee to deliver services with due care and skill) and section 101 (breaching an obligation to provide details of the costs of materials and labour). The Original Tribunal noted these allegations in its reasons for decision and dealt with them.[28]
[28] [2023] ACAT 80 at [12], [26], [29], [30] and [57]
On appeal, the appellant continued to press his claim that the respondent had breached sections 18, 60 and 101 but did not engage with the ways in which the Original Tribunal responded to these alleged breaches or point to any error in the way it did so.
Where we can see no error, in particular by dealing with the alleged breach of section 18 as an aspect of the contract law claim; by dealing with the alleged failure to provide a service with due care and skill in the ways described and dealt with in relation to ground 4; and by noting that the substance of the alleged breach of section 101 fell away once the respondent tendered receipts for materials and labour to the extent available, we see no error underpinning ground 6. It therefore fails.
Ground 7: no mention in contract to build a sunroom
The appellant alleged the Original Tribunal made an error of fact by saying “the contract did not say the respondent is building a sunroom.”[29] The appellant then went on to discuss the structural aspects of what a sunroom entails, the discussions he had with the respondent about construction of the sunroom and that by text message the respondent contracted to construct a sunroom. The appellant then referred to evidence of the respondent about how many sunrooms he had built and cast doubt on that evidence.
[29] Appellant's written submissions in response to order 1B at [56] and [58]
The question on appeal was whether the Original Tribunal made an error of fact, as alleged.
For two reasons, we do not accept it did so.
First, the Original Tribunal’s reasons for decision refer to the appellant and his wife wishing to convert their deck and pergola “to a sunroom” and then, in the following paragraph, details the terms of the contract for that purpose.[30] In other words, it is plain the Original Tribunal understood the contract was for the purpose of constructing a sunroom even if that was not stated.
[30] [2023] ACAT 80 at [14]-[15]
Second, notwithstanding its acknowledgement about the purpose of contract, the Original Tribunal was correct to state “the contract did not say the respondent is building a sunroom”. Referring to the text message recording the terms of the contract, that statement is correct. There is no mention of “sunroom” and the only words describing the whole project are “install new pergola under the existing roof” following which are details of the work to be done.
Looking at the contract alone, it is reasonable to conclude “sunroom” was intended to be no more than an enclosed pergola even though other evidence suggests more was understood between the parties. Ground 7 fails.
Ground 8: work to be done to Australian standard and completed in two weeks
The appellant referred to a roof rafter hanging precariously with one screw on the back wall and the lack of structural integrity of the header beam, in particular the use of bugle screws. The appellant relied on as evidence of the appellant not doing work with due care and skill and not to Australian standards.
This argument repeated the substance of grounds 3 and 4 and, arguably, ground 6 referenced to the alleged breach of section 60 of the ACL. Where we have dealt with those grounds, and ground 8 does not raise any additional issue, we similarly find ground 8 fails.
Ground 9: foundation safety and strength of substructure and superstructure
The appellant developed a lengthy submission that the foundations (the substructure under the ground) and the superstructure (being everything above ground) was unsound, defective and unsafe. He extracted many photographs from Mr Broadhurst’s inspection report to detail his claims, adding comments from himself to highlight the alleged defects.
The appellant debated the respondent’s evidence at hearing and repeated his claims made about what the respondent had said he would do.
The appellant went on to quote passages from the Original Tribunal’s decision and asserted the Original Tribunal made an error of fact, was wrong on fact or made a discretionary error but did not say why. He simply contended it to be so, as a bare assertion. In particular, he did not engage with the Original Tribunal’s reasons for why it was not persuaded the respondent should pay compensation or rectify the defects, in particular because the Original Tribunal’s conclusion that the contract had come to an end by mutual agreement at a point in time when the work was not finished.
We acknowledge the appellant’s frustration that a decision in his favour was not given, but simply to assert the decision was wrong, without explaining why, does not make it so. Ground 9 fails.
Ground 10: approval of the project
In his inspection report, Mr Broadhurst commented that for the sunroom to be a habitable room, a development application needed to be lodged and approved. If development is approved, then the building application must be applied for and given, a certifier must be appointed, and a licensed builder must then perform the work. Mr Broadhurst goes on to say there was no development application approved, no building application approved, and the respondent is not a registered builder.
The Original Tribunal dealt with the need for approval of the project by commenting that the contract never dealt with obtaining approvals. It was simply a contract to construct the sunroom.[31]
[31] [2023] ACAT 80 at [23(a)], [61]-[62]
On appeal, the appellant referred to section 205 of the Planning and Development Act 2007 (now repealed) that provided for development approval to be given with retrospective effect and how that can be obtained. The appellant criticised the Original Tribunal for not being aware of or considering this legislation and submitted, accordingly, the Original Tribunal was wrong on fact and law.
The appellant’s submission missed the point. The Original Tribunal was not commenting on how or when development approval and, subsequently, building approval can be obtained or suggesting it cannot be obtained with retrospective effect. It was simply pointing out, by reference to Mr Broadhurst’s comment, that these approvals would need to be obtained and had not been obtained. The question was whether the respondent should be held responsible for not obtaining approvals or commencing work before approvals had been obtained. The Original Tribunal concluded he should not because obtaining approvals was not part of what he was required to do under the contract. The appellant did not engage with that issue. We see no error in the Original Tribunal’s conclusion that approvals were not the respondent’s responsibility. Ground 10 fails.
Ground 11: comments from structural engineers, suppliers and building report
In its reasons for decision, the Original Tribunal dealt with Mr Broadhurst’s report and on comments the appellant had obtained from other experts about the respondent’s work.[32] In particular, the Original Tribunal explained why it could not conclude the respondent had breached the contract in the way the appellant pressed with reliance on Mr Broadhurst’s comment that a piece of timber on top of the header was “non-standard” when the meaning of those words is unclear. The Original Tribunal also explained why little weight could be given to comments from other experts based solely on photographs the appellant sent to them when these other experts had not provided written reports and did not give evidence at hearing.
[32] [2023] ACAT 80 at [51]-[52]
The Original Tribunal commented that one of the experts who commented, Mr Johnson, a structural engineer in Utah, USA, “may have limited knowledge of standards in this country.”[33]
[33] [2023] ACAT 80 at [52]
The Original Tribunal also stated –
In any case, in my view, the comments they made mostly reflect the incompleteness of the work rather than point to a failure to meet the term of the contract.[34]
[34] [2023] ACAT 80 at [52]
On appeal, the appellant submitted the Original Tribunal wrongly assumed that because Mr Johnson lives in Utah, he has limited knowledge of how things are done in Australia. He also submitted the respondent’s work was “basic nothing complex”,[35] that the respondent claimed to have 16 years of carpentry experience and that the respondent constantly used unfinished work as an excuse to cover his mistakes. For these reasons, the appellant contended the Original Tribunal was “wrong on fact”.[36]
[35] Appellant's written submissions in response to order 1B at [90]
[36] Appellant's written submissions in response to order 1B at [90]
The appellant’s submissions are misconceived. The Original Tribunal did not state it assumed Mr Johnson had limited knowledge of how things are done in Australia. It was simply observing that Mr Johnson “may have” limited knowledge because he is from the USA and that because the Original Tribunal did not know, one way or another, about Mr Johnson’s knowledge of standards in Australia, less weight could be placed on his comment in his email. We see no error in the Original Tribunal discounting the weight that could be given to Mr Johnston’s comment for this reason.
The appellant’s submissions about the respondent using unfinished work to cover his mistakes is also misconceived. True, the respondent explained at hearing that the work was unfinished at the time the contract ended and that he would have rectified any defects had the contract continued, but that is not the point. In issue is the Original Tribunal accepting that evidence, in the sense of noting the work was incomplete, to explain why it was not satisfied the respondent had breached the contract. The appellant does not engage with that issue, which was central to the way in which the Original Tribunal dealt with Mr Broadhurst’s report and the comments from other engineers. For these reasons, ground 11 fails.
Ground 12: ‘no work is completed’
The appellant submitted that the Original Tribunal and the respondent wrongly took a retrospective view about the work the respondent needed to do to rectify defects and should have taken a prospective view. In this sense, the appellant contended he raised his concerns with the respondent and requested the respondent to fix them in 2021 and those same issues or concerns were raised by Mr Broadhurst in his inspection report in 2022.
The appellant submitted that the Original Tribunal wrongly applied concepts of duty and breach by focusing on the incident in 2021 and looking back on it retrospectively, whereas it should have looked at it prospectively and focussed on the tasks the respondent should have done to rectify the defects. In support, the appellant relied on a decision of the NSW Court of Appeal in Swift v Wearing-Smith[37] on appeal from a decision of the NSW District Court in Wearing-Smith v Swift.[38]
[37] [2016] NSWCA 38
[38] [2014] NSWDC 159
With respect, the appellant’s submission is confused. The Original Tribunal and the respondent readily acknowledged there were defects in the work done at the time the contract came to an end. In issue was whether the respondent was in breach of the contract at that time. The Original Tribunal concluded he was not because the defects could have been rectified, as the respondent would have been obliged to do, had the contract continued. However, once the contract ended, it was not for the respondent to continue doing work.
In particular, where the contract ended somewhere between 12 and 15 February 2021, the fact there were defects still to be rectified was not to the point: the contract had ended. The whole idea of the respondent having prospective obligations subsequent to termination of the contract is misconceived.
The decision of the NSW Court of Appeal in Swift v Wearing-Smith does not assist the appellant’s case. That was a case brought in the tort of negligence arising from a person’s fall from a balcony on 5 November 2011 when the balustrade gave way consequent on structural rust. The case turned on whether the builder was negligent by not recognising and acting upon the risk of the balustrade giving way by reason of evidence held by the builder in 2002 and 2006 about rust in the steel components of the balustrade. That case, in law and fact, has no bearing on this case. Ground 12 fails.
Ground 13: essentiality test
In this ground, the appellant returned to his claim, referenced to the respondent’s text message that constituted the contract, that works to be done to “Australian standards” was an essential term of the contract. The appellant noted he referred to two cases, Tramways Advertising Pty Ltd v Luna Park (NSW) Ltd[39] and Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd,[40] in support of his claim that work to be done to Australian standards was an essential term.
[39] (1938) 38 SR (NSW) 632
[40] [2007] HCA 61
From there, the appellant submitted that to comply with Australian standards the respondent needed to comply with the National Construction Code, relevant technical standards and local laws to ensure the building is safe, healthy and durable. From there, the appellant relied on photographs in Mr Broadhurst’s inspection report to submit the respondent’s work was not to Australian standards.
The appellant criticised the Original Tribunal for being “unable to come up with a meaningful and conclusive definition”[41] of Australian standard and for not questioning the respondent as to what he meant by Australian standard in the contract. The appellant then contended the Original Tribunal made an error of fact by defining the term on behalf of the respondent, for concluding the term failed the “essentiality test” without first verifying the respondent’s intent and his definition of Australian standard and instead providing his own view without knowing the respondent’s intent.
[41] Appellant's written submissions in response to order 1B at [105]
Ground 13 repeated the substance of ground 3 and did not engage with the Original Tribunal’s reasons in relation to the term of the contract. For example, the Original Tribunal acknowledged “Australian standards” might mean the standards issued by Standards Australia but noted there is no evidence to that effect and, even if it had that meaning, there is no evidence of what standards applied or were breached.
Likewise, the Original Tribunal referred to the cases relied upon by the appellant, accepted the term may well have been an essential term and acknowledged the term was “centrally important, at the very least”. But nothing turned on that characterisation because there was no evidence of breach at the time the contract ended. In other words, whatever meaning the Original Tribunal or the respondent thought should be given to the words “Australian standards” it was not of material consequence because it was not possible to conclude breach when the work was unfinished.[42] Ground 13 fails.
Ground 14: the two weeks completion date
[42] [2023] ACAT 80 at [54]
The appellant contended that completion of the sunroom in two weeks was an essential term of the contract. In support, he relied on the words “the whole job will be completed up to 2 weeks” in the respondent’s text message constituting the contract. He submitted the Original Tribunal erred by not finding it to be an essential term and submitted the Original Tribunal misinterpreted his text message to the respondent sent on 4 February 2021 in which the appellant stated, “We are not in a hurry”.[43]
[43] [2023] ACAT 80 at [45]; Appellant's written submissions in response to order 1B at [109]
Again, the appellant did not engage with the Original Tribunal’s reasons for decision. The Original Tribunal did not find the sentence in the contract about completing the work in two weeks not to be an essential term because of the appellant’s text message. It simply commented that the message was inconsistent with timeliness being an essential term.[44] Its reasons for not finding timeliness to be essential related to other considerations such as the fact that construction was outdoor work and was subject to considerations such as the weather, worker sickness and injury, shortage of materials and so on.
[44] [2023] ACAT 80 at [45]
Also, whether the term was essential or not made no difference to the outcome because, as the Original Tribunal noted, the appellant brought the project to a halt two to three days after the work began because he was not satisfied the work so far done was adequate, which was at a time well within the two weeks stated in the contract. In other words, even if the term was essential, the respondent could not have been in breach because the appellant caused work to stop following which the whole project was brought to an end. Ground 14 fails.
Ground 15: the test for repudiation
In ground 15, the appellant repeated his claim that the respondent repudiated the contract by demonstrating he was not ready, willing and able to perform it with the consequence that the appellant had the right to terminate the contract and seek damages.
In support, the appellant referred to his evidence that he asked the respondent to fix his defective work but was ignored and the respondent stopped work after 1 February 2021. The appellant referred to his requests to the respondent to meet and discuss his work, and what he was going to do to rectify the defects and complete the work and the respondent ignoring these requests. By reference to this evidence, the appellant claimed the Original Tribunal erred by not finding the respondent repudiated the contract by his conduct in showing he intended no longer to be bound by it.
Ground 15 is an attempt by the appellant to re-argue his claim, rather than engage with the question why the Original Tribunal concluded the respondent did not repudiate the contract.
The Original Tribunal clearly engaged with the appellant’s argument: it notes it as a second possibility for how the contract came to an end.[45] It noted also the importance of determining how the contract ended because it “may determine whether damages are to be paid and influence the quantum of those damages”.[46]
[45] [2023] ACAT 80 at [37]
[46] [2023] ACAT 80 at [37]
In rejecting the appellant’s claim that the respondent repudiated contract, it noted the appellant had called a halt to the project, was waiting on the respondent’s promised plan setting out work to be done and the respondent was stating he would continue the work once a metal joist arrived. Importantly, the Original Tribunal concluded by reference to the appellant’s evidence:
Mr Goh’s admission [that he brought the contract to an end once he could see that work was not going to proceed] could be understood as a repudiation of the contract [by the respondent], but taking his evidence more generally, I think he is saying that he entered the contract because he was convinced that Mr Kabadanis was not going to do any more work.[47]
[47] [2023] ACAT 80 at [40]
The Original Tribunal concluded it did not have the evidence to conclude the contract ended in a way that put either party clearly in the wrong or, in particular, that the respondent repudiated the contract.[48]
[48] [2023] ACAT 80 at [41]
On appeal, the appellant did not engage with the evidence regarding his own conduct for why he, rather than the respondent, brought the contract to an end. Nor does the appellant engage with the Original Tribunal’s concerns about the appellant calling a halt to work because of the appellant’s concerns about defects and whilst awaiting a plan from the respondent about work to be done.
We recognise that views may differ about characterisation of what occurred, but we are not persuaded the Original Tribunal erred in not being satisfied, having regard to the competing aspects of the evidence, that the respondent did not repudiate the contract and that it ended by mutual agreement or abandonment following dissatisfaction on both sides about what was occurring. Ground 15 fails.
Ground 16: charges and remedy
The appellant contended the respondent’s claimed labour costs and labour time are inflated. For example, the appellant contended that on each of 27 and 28 January 2021 the respondent came to site with three workers and twice counted four people for four days rather than four people for each day. The appellant also noted he was unable to cross-check the respondent’s material costs against invoices because “we only got a bit here and there not all of them “.[49] The Original Tribunal noted these claims in its reasons for decision.[50]
[49] Appellant's written submissions in response to order 1B at [122]-[124]
[50] [2023] ACAT 80 at [78]
The appellant also noted the Original Tribunal concluded damages based on quantum meruit, and submitted it was wrong on fact because he was left with the respondent’s defective work and the respondent received “$10,500 for 2.0 – 2.5 days’ work, although he claimed 11 work days”.[51]
[51] Appellant's written submissions in response to order 1B at [125]
In our view, the appellant’s claim does not reflect the Original Tribunal’s reasoning. True, the respondent never provided any evidence of what workers on site were paid and, in our view, in all probability that is because there is no record. But that does not mean they were not paid. Looking at the appellant’s own calculation of labour on site, four people (including the respondent) worked on each of 27 and 28 January 2021 and three workers (including the respondent) worked on 1 February 2021. In broad terms, excluding any money for the respondent, that equates to a total of 8 days’ wages (3+3+2) paid to persons he engaged to help with the construction work. The Original Tribunal allowed $3,400 for labour which equates, on average, to a payment of $425 per day per person for labour. We see no error in the Original Tribunal adopting that figure[52] as reasonable. Importantly, responding to the appellant’s claim, the allowance for labour costs was $3,400, not $10,500.
[52] [2023] ACAT 80 at [79]
Regarding materials, we checked the tax invoices provided by the respondent and calculated the total to be $4,813.71 after deduction of the lesser of the two invoices invoices for the Colorbond roofing material. We see no error in the Original Tribunal allowing $4,810 for materials. In particular, nothing was allowed for the respondent’s claimed payment of a deposit of $1,000 for a sliding door.
The Original Tribunal noted that after deduction of his costs, the respondent was left with $2,290 from the $10,500 paid to him by the appellant. The Original Tribunal determined each party should receive half of that amount. It does not explain why, but in our view, it is implicit if not obvious from its finding that the contract ended by mutual agreement. We see no error in the Original Tribunal reaching that conclusion which, in our view, was reasonable. The appellant does not suggest otherwise, save for his claim that the whole outcome was wrong.
The Original Tribunal noted the respondent had already paid the appellant $1,145 in response to an order that he do so made on 5 July 2022 by an earlier differently constituted original tribunal. It therefore dismissed the appeal.
Conclusion
Where we see no error in the Original Tribunal’s determination of the application before it, the appeal is dismissed.
………………………………..
Presidential Member G McCarthy
For and on behalf of the Tribunal
| Date of hearing: | 3 May 2024 |
| Appellant: | In person |
| Respondent: | In person |
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