Killick v McPherson
[2009] NSWDC 134
•17 June 2009
Reported Decision:
9 DCLR (NSW) 298
District Court
CITATION: Killick v McPherson [2009] NSWDC 134 HEARING DATE(S): 28 April - 1 May 2009
JUDGMENT DATE:
17 June 2009JURISDICTION: Civil JUDGMENT OF: Murrell SC DCJ CATCHWORDS: Appeal from the Consumer Trader and Tenancy Tribunal - "error of law" - procedural fairness - delay - inadequate reasons - CONTRACTS - general contractual principles - discharge, breach and repudiation - DAMAGES - measure and remoteness of damages in actions for breach of contract - TORTS - miscellaneous torts - tort of deceit. - DAMAGES - measure and remoteness of damages in actions for tort - measure of damages - tort of deceit. LEGISLATION CITED: Consumer Trader and Tenancy Tribunal Act 2001
Consumer Trader and Tenancy Tribunal Regulation 2002
Home Building Act 1989CASES CITED: Azzopardi v Tasman UEB Industries Ltd (1985) 4 NSWLR 139
Chapman v Taylor & Ors; Vero Insurance Ltd v Taylor & Ors [2004] NSWCA 456
Deloitte Touche Tohmatsu v Australian Securities Commission (1996) 136 ALR 453
Expectation Pty Ltd v PRD Realty Pty Ltd (2004) ALR 568
Fitness First v Chong [2008] NSWSC 800
Foran v Wright (1989) 168 CLR 402
Gould v Vaggelas (1983) 157 CLR 215
Grygiel v Baine [2005] NSWCA 218
Holmes v Jones (1907) 4 CLR 1682
Kalokerinos v HIA Insurance Service Pty Ltd [2004] NSWCA 312
Kioa v West (1985) 159 CLR 550
Kizbeau Pty Ltd v WGB Pty Ltd (1995) 184 CLR 281
Magill v Magill [2006] HCA 51
Mannai Investments Co Pty Ltd v Legal Star Life Assurance Co Ltd (1997) AC 749
McAllister v Richmond Brewing (1942) 42SR (NSW) 87
MIMIA v Yusuf (2001) 206 CLR 323
NAIS v MIMA (2005) 228 CLR 470
Shevill v Builders Licensing Board (1982) 149 CLR 620
Singh v MIMA (2001) 109 FCR 152
Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247
State Rail Authority of New South Wales v Consumer Claims Tribunal (1989) 14 NSWLR 473
SZBEL v MIMA (2006) 228 CLR 152
SZFDE v MIMA (2007) 232 CLR 189
Toteff v Antonas (1952) 87 CLR 647PARTIES: Jeffrey KILLICK
Christopher MCPHERSONFILE NUMBER(S): 4581/08 COUNSEL: G Miller QC and B Zipser for the Appellant
E Olsson SC for the RespondentSOLICITORS: Tiernan & Associates Lawyers for the Appellant
Turnbull Bowles Lawyers for the Respondent
The Building Works
1 Mr Killick (the owner) sought tenders for alterations and additions to his home. Mr McPherson (the builder) was an inexperienced builder who was "hopeless with paperwork". He submitted a quotation for the works. It was in very general terms. The owner required greater detail. In order to assist the builder to give a detailed tender, in August 2003 the owner provided the builder with a copy of a detailed competing tender document from a builder whom both parties considered to be reputable. From that document, the owner had deleted the itemised and total amounts. In fact, the effective total amount quoted by the competing tenderer was $453,287. The competing tenderer was unable to undertake the work for twelve months.
2 Having received the edited competing tender document, the builder began to note what he considered to be appropriate draft allowances beside the items in the edited tender document. When the builder had progressed at least two thirds of the way through the list of items, he became concerned because the total of the draft allowances exceeded $400,000 and he had not yet completed the process. He telephoned the owner.
3 It was the builder's evidence that the owner assured him that he wanted the builder to do the job. The owner offered to provide the builder with the figures contained in the competing tender document. The owner told the builder that, if the builder could match the itemised quotes in the competing tender document, he could have the job as there would be a delay in the competing tenderer commencing the work. The builder relied on the owner's statement that he would get the job if he matched the competing tenderer's quote.
4 The owner and the builder discussed appropriate allowances by reference to the items in the competing tender document. When the builder proposed a sum that was lower than that in the unedited competing tender document, the owner concurred. When the builder proposed a greater sum, the owner told the builder that the competing tenderer had submitted a price that was, in fact, lower than the price submitted by the competing tenderer. The builder reduced his draft allowances accordingly. Exhibit 7 records the items in relation to which the owner said that the competing tenderer had submitted a lower price.
5 The amended draft allowances (or very similar amounts, relevantly totalling about $47,234) found their way into the builder’s final tender of (relevantly) $302,260. The owner accepted the tender. On 12 September 2003, the parties entered a standard building contract.
6 At the time of the telephone conversation, the owner and the builder made notes. Contemporaneous facsimile documents record the changes that the builder made as a result of the conversation.
7 It was the builder's evidence that, by February 2004, he had formed the view that, as a result of the owner's deception, he had under-quoted the job. The owner offered to pay the builder $10,000 and an additional $10,000 upon completion of the job. The builder accepted that offer and the owner paid the sum of $10,000.
8 There were disagreements about alleged variations. In late April/early May 2004, the builder indicated that he could not afford to complete the works. On 19 May 2004, the owner’s architect issued the builder with an instruction, giving the builder 10 working days to complete certain work. The builder contended that the work was not part of the contract. Thereafter, the builder did no work on the site. However, on 19 May 2004, the builder stated that he had "no intention of walking off the job" (page 92, Exhibit 1) and on 21 May 2004 he requested an additional payment, stating "once we have sorted out I will move quickly finishing the house and will have all jobs complete by three weeks" (page 92 A, Exhibit 1).
9 On 3 June 2004 the architect required the builder to complete listed items within 10 working days in accordance with sections M10 and M11 of the contract (page 94, Exhibit 1). On the same day, the owner changed the locks and engaged another builder to complete the works.
Proceedings In The CTTT
10 The owner brought proceedings in the Consumer Trader and Tenancy Tribunal (CTTT) claiming the sum of $53,844 in relation to completion of the works and remediation of allegedly faulty works. He asserted that the builder had repudiated the contract by discontinuing the works.
11 The builder made a cross claim. At the hearing, he sought monies outstanding under the contract and claimed damages for misrepresentation. He asserted that the owner had repudiated the contract.
12 In the course of its "reasons for interim decision" given on 8 May 2007, the CTTT made the following statements:
- "Having carefully considered all the evidence I am comfortably satisfied that (the owner) did mislead (the builder) about the amounts that (the competing tenderer) had submitted for a variety of the items on the quote. I am equally satisfied that this conduct induced (the builder) to submit a price for the job which was wholly unrealistic.
…
I now turn to consider the tort of deceit. … I have little difficulty concluding that (the owner) knew that the figures he was relaying to (the builder) were not those set out in (the competing tender). That being so the measure of damages is that … a party is to be put so far as possible in the position he would have been in had he not acted on the fraudulent inducement. … consequential as well as direct losses can be compensable, in appropriate cases on a more generous basis of remoteness than applies in contract. "
13 The parties made written submissions on damages. The builder claimed the sums of $57,671.50 (damages for breach of contract following repudiation by the owner) and $107,419.40 (damages for deceit). On 5 March 2008, the CTTT delivered "reasons for decision" on damages. Those "reasons" did not contain reasons, stating only that:
"Having considered the submissions of the parties the Tribunal finds that the appropriate amount to be paid by (the owner) to (the builder) is the adjusted amount outstanding under the uncompleted contract $57,671.50 plus damages in deceit amounting to the difference between the represented and real contract prices of $107,419.40, a total of $165,090.90."
Issues
14 A party that is dissatisfied with a CTTT decision on " a question with respect to a matter of law", including a matter relating to the jurisdiction of the Tribunal, may appeal against the decision: s67 (1) and (8) Consumer Trader and Tenancy Tribunal Act 2001 (the Act).
15 The right of appeal conferred by section 67 (1) should not be given an expansive construction: Grygiel v Baine [2005] NSWCA 218 per Basten JA at [26] and [29]. An error of law is established where it is shown that the CTTT applied a wrong principle of law. That may be shown either from what was said or because the ultimate result, associated with the facts that were expressly or impliedly found, indicates that the Tribunal must have applied a wrong principle of law: Chapman v Taylor & Ors; Vero Insurance Ltd v Taylor & Ors [2004] NSWCA 456 at [33], Fitness First v Chong [2008] NSWSC 800. Express advertence to a matter of law is not necessarily required if a decision with respect to the matter was necessarily involved in another finding: Kalokerinos v HIA Insurance Service Pty Ltd [2004] NSWCA 312 at [47] and [56].
16 Provided there is some evidence of a particular fact, there can be no appeal against a factual finding, even if it is "perverse" or "contrary to the overwhelming weight of the evidence": Azzopardi v Tasman UEB Industries Ltd (1985) 4 NSWLR 139 per Glass JA at 155 – 156 and Samuels JA at 157.
17 The owner claims that the CTTT made the following errors of law:
1.The CTTT denied procedural fairness by finding deceit although the builder had "abandoned" any such allegation.
2. The CTTT failed to identify the representations upon which the finding of deceit was based.
3. A finding of deceit was not open on the evidence as there was no evidence of reliance or dishonesty.
4. In considering the question of deceit, the CTTT failed to take account of contemporaneous documents.
5. Damages for deceit were incorrectly assessed on the basis of lost revenue rather than lost profit.
6. Having regard to the terms of the building contract, it was not open to find that the owner had repudiated the contract.
8. A denial of procedural fairness should be inferred because of the delay between the hearing and decision, combined with inadequate reasons for decision.7. Damages for repudiation were incorrectly assessed.
18 It is agreed that, if the Court finds that there was an error of law, the proceedings should be re-listed for argument on the appropriate remedy.
The CTTT
19 The requirements of procedural fairness depend on the construction of the statute under consideration: Kioa v West (1985) 159 CLR 550 at 584, SZBEL v MIMA (2006) 228 CLR 152 at [26].
20 The CTTT is established under the Act to determine disputes in relation to matters over which it has jurisdiction: s 3 (a) of the Act. Pursuant to s 48K (1) of the Home Building Act 1989, the CTTT has jurisdiction to hear and determine building claims for sums up to $500,000. It is the body chiefly responsible for resolving such claims. If such claims are commenced in a court, the defendant may transfer the proceedings to the CTTT: s 48L Home Building Act.
21 An application to the CTTT must be in writing and must be made in accordance with the regulations: s 24 (2) of the Act. Under clause 9 (1) of the Consumer Trader and Tenancy Tribunal Regulation 2002 (‘The Regulation’), pleadings are not required. The application must contain a description of the order or orders sought by the applicant (cl 9(1)(c)); particulars sufficient to enable each other party to know the nature of the claim or dispute (cl 9(1)(d)); and, if an amount of money is claimed or in dispute, the amount claimed or disputed (cl 9 (1)(e)).
22 One of the objects of the Act is to enable proceedings to be determined in an informal, expeditious and inexpensive manner: s 3 (c). The CTTT is to act as expeditiously as is practicable: s 28 (5) (a). It is not bound by the rules of evidence and may inquire into and inform itself on any matter in such manner as it thinks fit, subject to the rules of procedural fairness: s 28 (2). Section 28 (3) provides:
“(3) The Tribunal is to act with as little formality as the circumstances of the case permit and according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms.”
A party is not entitled to legal representation unless the CTTT approves an application for representation: s 36 (2).
23 Although the Tribunal is not bound by the usual rules or practice as to evidence, it must act in accordance with and apply the general law: State Rail Authority of New South Wales v Consumer Claims Tribunal (1989) 14 NSWLR 473 at 477 – 479.
24 Given the requirement that the CTTT must apply the general law and must take such measures as are reasonably practicable to ensure that the parties to proceedings understand the nature of the assertions made in the proceedings and the legal implications of those assertions (s 8 and s 28 (4) (a)), it is, perhaps, surprising that the Tribunal may be constituted by one member (s 11) and that a member of the CTTT need not be legally qualified.
25 Section 49 of the Act provides:
“Notice of decisions and reasons
(1) The Tribunal must, within the time prescribed by the regulations, give notice of its decision in a matter that is the subject of proceedings to the parties in the proceedings. The notice must indicate that any party may, within 14 days of receiving notice of the decision, request the Tribunal to provide a statement of reasons for its decision.
(3) The statement may be brief but must:(2) Any party may, within 14 days of receiving notice of the decision, request the Tribunal, in the manner prescribed by the regulations, to provide a statement of reasons for its decision. The statement must be provided within 28 days after the request is made.
(a) set out the decision and the reasons for it, and
(b) set out the findings on any material question of fact, and
(c) refer to the evidence or any other material on which the findings of fact were based.”
For the purposes of s 49 (1) of the Act, the prescribed time within which notice of the Tribunal’s decision must be given to the parties is 7 days after the Tribunal makes the decision: clause 35 (1) of the Regulation.
26 In MIMIA v Yusuf (2001) 206 CLR 323, the High Court considered a provision that was similar to s 49 of the CTTT Act (although the provision did not refer to the statement being "brief"). At [68] – [69] the Court stated that the provision merely imposed a subjective obligation upon the tribunal to set out its findings on the questions of fact that it considered to be material to the decision and to its reasons for reaching that decision.
27 In summary, despite the substantial jurisdiction of the CTTT, its procedures are designed to be speedy and informal. Although the Tribunal must apply the general law, there is no entitlement to legal representation and the Tribunal may be constituted by a member who is not legally qualified. In the absence of a request to do so, the Tribunal is not required to give reasons for a decision. If reasons are requested, the Tribunal is required to provide brief reasons within 28 days of the request. In those reasons, the Tribunal must set out its findings on the questions of fact that, subjectively, it considers material to the decision.
Abandonment of the Case in Deceit (Ground 1)
28 It is a fundamental requirement of procedural fairness that a party know the case that it must meet. Had the CTTT determined the case on the basis of a cause of action that had been "abandoned", there would have been a breach of the requirements of procedural fairness.
29 Although under s 65 of the Act relief may be granted where the CTTT has denied procedural fairness, it is far from clear that such jurisdiction vests in the District Court.
30 In any event, the owner cannot substantiate the submission that the builder "abandoned" any claim in fraud. In correspondence of 19 May 2004, the builder asserted pre-contractual deceit (page 92, Exhibit 1). Throughout the CTTT hearing, the builder's case was one of deliberate misrepresentation. The misrepresentation claim was articulated from paragraph 27 of the builder’s further amended points of claim (page 5, Exhibit 1). In paragraph 29, the builder asserted that the owner "knew at the time of making the representations that they were not factually correct and were false". In his written submissions to the CTTT from [118] to [126], the owner replied to the allegations of fraudulent misrepresentations. The claim in deceit was in contention throughout the CTTT proceedings.
Particularisation and Evidence of Deceit (Grounds 2, 3 and 4)
31 It must be doubted whether any "error of law" is identified in ground 2, 3 or 4. The grounds do not identify any respect in which the CTTT applied a wrong principle of law. Ground 2 alleges inadequate reasoning, but the scheme of the Act requires only brief reasons such that the reader may understand the basis for the decision. In effect, grounds 3 and 4 assert that the Tribunal made incorrect factual findings, but under s 67 of the Act there is no appeal against a factual finding. In any event, the grounds are not made out.
32 The tort of deceit will be established where five elements are shown: that the defendant made a false representation; that the defendant made the representation knowing that it was false; that the defendant made the representation with the intention that it be relied upon by the plaintiff; that the plaintiff acted in reliance on the false representation; and that the plaintiff suffered damage caused by reliance on the false representation: Magill v Magill [2006] HCA 51 at [114].
33 Generally, a finding of deceit should specify the substance of the fraudulent statement, that which was fraudulent, and the manner in which it was relied upon: SZFDE v MIMA (2007) 232 CLR 189 at [41].
34 The CTTT noted that the owner misled the builder about "a variety of items" but did not specify the items. The owner submitted that the failure to particularise fraudulent misrepresentations and describe the reliance demonstrated an error of law.
35 Although the CTTT did not expressly name the items in question, they are obvious. The items are particularised in Exhibit 7, a document generated by the owner from contemporaneous documents. Exhibit 7 shows the items in relation to which (as CTTT found) the owner told the builder that the competitor had submitted a lower quote. The owner must have known that his statements were false as he had the competitor's tender before him at the time that he made the statements. Exhibit 7 summarises the evidence as to the statements that were made and the extent to which they were false. Exhibit 7 corroborates the builder's evidence that, in relation to the owner’s false statements, he lowered item allowances to amounts that were the same, or very similar to the amounts stated by the owner, i.e. that he relied on the owner’s false statements.
36 The owner submitted that the builder also relied in substantial part upon the builder’s expertise.
37 At page 5 of its reasons, the CTTT correctly stated that "reliance need not be complete". In Gould v Vaggelas (1983) 157 CLR 215 at 250 Brennan J reasoned:
- “(A tribunal) of fact may infer that such a material misrepresentation induced the representee to enter into the contract and the fact that there were other inducements to him to do so does not necessarily preclude the drawing of that inference.”
38 Exhibit 7 supports the proposition that the Tribunal did take into account the documents that were contemporaneous with the critical telephone conversation.
39 In relation to deceit, the specific representations were so obvious that they did not need to be stated. Inter alia, they were contained in contemporaneous documents. There is nothing to suggest that the CTTT failed to consider the contemporaneous documents. Indeed, the contrary is true. The finding of deceit was open on the evidence. Grounds 2, 3 are 4 are not established.
Damages for Deceit (Ground 5)
40 In an action for damages for deceit, the defrauded party is to be put so far as possible in the position in which he or she would have been had he or she not acted on the fraudulent inducement: Gould at 220-221 per Gibbs CJ. The damages are the loss suffered because of reliance on the fraudulent representation: Magill v Magill at [115]. In Gould, the Court also approved measure of damages for deceit stated in Toteff v Antonas (1952) 87 CLR 647 to be:
“a sum representing the prejudice or disadvantage (the defrauded party) has suffered in consequence of his altering his position under the inducement of the fraudulent misrepresentations made by the defendant.” Toteff at 650; Gould at 220.
41 Where a seller defrauds a purchaser so that the purchaser pays a higher price, the measure of damages is “the amount by which the price which (the purchaser) has paid exceeds the true value of the (thing purchased)”: McAllister v Richmond Brewing (1942) 42SR (NSW) 87 at 192 per Jordan CJ (emphasis added); Kizbeau Pty Ltd v WGB Pty Ltd (1995) 184 CLR 281 at 291. In such cases, it is necessary for the purchaser to show that the thing purchased was worth less than was paid for it: Holmes v Jones (1907) 4 CLR 1682; Toteff; Gould at per Dawson J at 265. In Gould Gibbs CJ (at 223) considered that, where a defrauded party was not a purchaser, “the measure of damages is the sum which represents the loss which the plaintiff’s have suffered because they altered their position”.
42 The builder asserted that the competing tenderer’s price of $453, 287 was the “true value” of the works. The builder bore the onus of proving that, but for the owner’s fraudulent representations, he would have submitted a tender equivalent to $453,287 and the owner would have accepted the tender.
43 Although the owner submitted that there was no evidence on which the CTTT could have found that the onus was satisfied, the owner was really complaining about the adequacy of the evidence. One of the owner’s arguments was that, if the CTTT considered that the owner's desire to enter into a building contract at the lowest possible price was so strong that he was willing to engage in deceit, it was not possible for the Tribunal to confidently conclude that the owner would have entered into a contract at $453,287.
44 In effect, the owner sought to traverse the The CTTT's factual findings, which are not amenable to appeal. In any event, there was evidence before the CTTT that entitled it to find that the onus was satisfied. According to the builder (whose evidence the Tribunal accepted) the owner provided the competing tender to the builder for the stated purpose of ascertaining whether the builder was prepared to meet it. The owner was anxious to commence the work. There was no evidence that the owner was in serious negotiation with any other builder. The fact that the owner wanted an itemised tender suggests that the owner was interested in contracting with the builder. It was open to the Tribunal to conclude that, had the builder submitted a quotation in the same amount as the competing tender, the owner would have accepted it. The CTTT accepted that the builder’s draft allowances exceeded $400,000 when the builder was only about two thirds of the way through the list. If that was the builder’s original position, it was open to the CTTT to find that, but for the deceit, the builder would have submitted a tender that was no less than the competing tender.
45 Using either the “true value” method or the “altered position” method to calculate damages for deceit, the loss suffered by the builder as a direct result of the deceit was the amount of the true value/ original position (calculated by reference to the competing tender of $453,287) less the contract price ($302,260).
46 As the CTTT arrived at a figure for deceit damages that precisely accorded with the builder’s submissions, it must have accepted the following calculations:
Competing tender less work excluded from the builder’s contract ($453,287.00 -$33,103)
= adjusted quote from competing tendererLess work not complete at termination = amount payable for the completed works less amount of contract = loss suffered by the builder as a result of the deceit
47 The owner claimed that the builder was only entitled to the profit and not the revenue that he would have made had he completed the building work. Such an approach would be valid if the builder had made no outlay. However, damages were calculated only on the work that had been completed, in relation to which the builder had outlaid on goods and labour. The loss of revenue was equivalent to the loss of profit.
48 Ground 5 is not made out.
Repudiation of Contract (Ground 6)
49 A contract may be repudiated if, by objective acts and omissions, a party evinces an intention no longer to be bound by the contract: Shevill v Builders LicensingBoard (1982) 149 CLR 620 at 625. If the other party elects to terminate the contract, that party must show that he or she was ready and willing to perform the contract had it not been repudiated: Foran v Wright (1989) 168 CLR 402 at 408.
50 The CTTT found that the owner had repudiated the building contract on the basis that he had "refused to approve legitimate claims for variations" and had excluded the builder from the site.
51 The owner argued that there was no basis upon which the CTTT could have found that he repudiated the building contract, there was no basis upon which the CTTT could have found that the builder clearly communicated his decision to terminate, and the builder was not entitled to terminate and seek damages as there was no evidence that the builder was willing and able to complete his obligations under the contract.
52 The matters about which the owner complained were factual findings. Unless there is a complete absence of evidence to support them, factual findings are not amenable to appeal under s 67 (1). There was evidence that, on 3 June 2004, before the architect’s M10/M11 notice had expired, the owner changed the locks and instructed another builder to complete the works. On the basis of that evidence alone, it was open to the CTTT to find that the owner had evinced an intention to no longer be bound by the contract and thereby repudiated the contract.
53 There was evidence that the builder was ready, willing and able to complete the contract. On 19 May 2004 the builder wrote to the architect stating that he had "no intention of walking off the job" and on 21 May 2004, he wrote to the owner stating that, once disputes were resolved, he would "move quickly" to finish the work. On the basis of this evidence, it was open to the CTTT to find that, despite differences between the parties, the builder was ready, willing and able to complete the contract.
54 As to the submission that the builder did not clearly communicate his decision to terminate the contract, the ultimate question is whether a reasonable person in the owner's position would be "left in no doubt" that the builder had elected to terminate: Mannai Investments Co Pty Ltd v Legal Star Life Assurance Co Ltd (1997) AC 749 at 768. After he was locked out, the builder did not return to the site. His conduct in failing to return is capable of being characterised as evincing a clear election to terminate.
55 There is no material establishing that the CTTT misapplied the law in relation to repudiation. Based on the correspondence and conduct of the parties, the Tribunal was entitled to find that it was the owner who repudiated the contract, that the builder by his conduct communicated an election to terminate and that, at the time of termination, the builder was ready and willing to complete the contract.
56 Ground 6 is not made out.
Damages for Repudiation (Ground 7)
57 The CTTT provided no reasons for its decision on damages. No application for a statement of reasons was made under s 49 of the Act. As the CTTT assessed damages for repudiation at $57,671.50, the exact amount claimed by the builder, the Tribunal must have adopted the builder's submissions that damages should be calculated as follows:
original contract price plus approved variations adjusted contract sum plus $20,000 as agreed final contract sum less amount paid amount unpaid less defective and incomplete work amount owed under contract
58 The owner submitted that the CTTT erred in taking the sum of $20,000 into account as the first sum of $10,000 had been paid and payment of the second sum of $10,000 was conditional on completion of the work. Further, the Tribunal’s characterisation of $20,000 was such should not be taken into account in assessing damages for breach of the principal contract.
59 For reasons that were not questioned on appeal, the Tribunal characterised the sum of $20,000 as a payment pursuant to a collateral contract rather than as a variation of the principal contract. Consequently, in assessing damages for breach of the principal contract, the Tribunal should have disregarded the sum of $20,000. The "final contract sum" of $339,409 requires adjustment. If the “amount paid” of $271,147 includes the sum of $10,000 paid under the collateral contract, then there must be an adjustment to the "amount paid". As a result of the two adjustments, the "amount allowed under the contract" would be $47,671.50.
Delay and Adequacy of Reasons
60 The owner argued that, in the context of the delay in providing them, the Tribunal's reasons were so inadequate as to demonstrate that the Tribunal did not properly consider the owner’s case, resulting in procedural unfairness.
61 As stated above in [29], I doubt that this Court has jurisdiction to remedy procedural unfairness.
62 The six-day hearing concluded in September 2006. During the hearing both parties called expert witnesses, the owner played a video recording with commentary, and a view was held. In October and December 2006, written submissions were filed. On 8 May 2007, the CTTT handed down its "interim decision" on liability. In August and September 2007, written submissions on damages were filed. On 5 March 2008, the CTTT handed down its decision on damages.
63 Delay may impair a tribunal's capacity to assess a case, particularly when it comes to making a proper assessment of the credibility of witnesses. If the delay is such as to prevent a fair consideration of the case then the requirements of procedural fairness may be unfulfilled: NAIS v MIMA (2005) 228 CLR 470 per Gleeson CJ at [9] – [11], Kirby J at [105]. Lengthy delay may mean that it is unacceptable for a tribunal to simply announce its conclusion on credibility. It may be necessary for the tribunal to elaborate and, in effect, demonstrate that evidence has not been forgotten or overlooked: NAIS per Kirby J at [88]. In Expectation Pty Ltd v PRD Realty Pty Ltd (2004) ALR 568 at [68], the Federal Court stated that, where there is a significant delay between hearing and the giving of reasons and the reasons do not advert to relevant contemporaneous materials, then the conclusions should be carefully scrutinised on appeal.
64 As CTTT procedures are designed to ensure that proceedings are disposed of in an informal, expeditious and inexpensive manner, it is unfortunate that there was a five-month delay between the lodging of written submissions in December 2006 and the giving of reasons in May 2007, and a six-month delay between the lodging of written submissions on damages in September 2007 and the decision of March 2008. However, the delay in the CTTT was, in no small part, due to the way in which the proceedings were conducted. The CTTT had to consider lengthy evidence and detailed submissions. In the context of the way in which the proceedings were conducted, the delay in providing decisions was not inordinate. Although protocols indicate that decisions should be given within a shorter timeframe, in relation to complex cases in the District and Supreme Courts, delays of the length in question are not uncommon.
65 Whether a tribunal's reasons are adequate will depend on the legislative scheme and the function to be served by the giving of reasons: Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 per McHugh JA at 280 – 281.
66 The owner relied upon the decisions of Singh v MIMA (2001) 109 FCR 152 at [58] and [59] and Deloitte Touche Tohmatsu v Australian Securities Commission (1996) 136 ALR 453 at 468 in support of the proposition that, where a decision maker is required to take a matter into account, the decision maker must give the matter genuine consideration. The owner argued that the CTTT had failed to genuinely consider some of the evidence. However, those cases concerned different legislation. Under the CTTT Act, there is no appeal against a factual finding and a failure by the CTTT to fully articulate reasons for a factual finding can have no consequence except, perhaps, in extreme circumstances.
67 I accept the general proposition that long delay combined with scant reasons is capable of evidencing procedural unfairness. However, as the CTTT is required to give only brief reasons that set out the factual findings that it considers material to its decision, it would be a rare case indeed where the combination of delay and scant factual reasoning would evidence procedural unfairness by the Tribunal. In this Court, procedural unfairness is not established.
68 The appellant is ordered to pay the sum of $155,090.90 to the respondent, and to pay the respondent's costs of the appeal. In relation to the costs of the proceedings before the CTTT, the order of the Tribunal is confirmed.
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