Kornucopia Pty Ltd v Zhu
[2019] VSC 440
•1 July 2019
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
JUDICIAL REVIEW AND APPEALS LIST
S ECI 2019 00929
| KORNUCOPIA PTY LTD (ACN 615 630 316) | Plaintiff |
| v | |
| GUOHUAI ZHU | First Defendant |
| VICTORIAN CIVIL AND ADMINISTRATIVE TRIBUNAL | Second Defendant |
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JUDGE: | Ginnane J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 29 May 2019 |
DATE OF JUDGMENT: | 1 July 2019 |
CASE MAY BE CITED AS: | Kornucopia Pty Ltd v Zhu |
MEDIUM NEUTRAL CITATION: | [2019] VSC 440 |
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JUDICIAL REVIEW — Residential tenancies — VCAT order dismissing tenant’s claim for compensation — Tenant seeking to lead evidence obtained after VCAT hearing completed — Whether Tribunal misled by evidence — Whether jurisdictional error or error of law on face of record.
PROCEDURAL FAIRNESS — Hearing rule — Evidence not disclosed to a party before VCAT hearing — Whether party deprived of ability to properly present case.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr D Preston | Tisher Liner FC Law |
| For the First Defendant | Mr S Brnovic | Fairweather Legal |
HIS HONOUR:
The plaintiff, Kornucopia Pty Ltd, seeks judicial review orders to quash the order of the Victorian Civil and Administrative Tribunal (‘the Tribunal’) of 4 January 2019 dismissing its application for compensation or reimbursement of $360.[1] Kornucopia was the tenant of a Docklands apartment pursuant to a tenancy agreement with the defendant, Mr Zhu, the landlord. Kornucopia claimed a fee of $225 for calling out a tradesperson to attend a gas cooktop in the apartment. Kornucopia also claimed the VCAT application fee.
[1]The application was made under s 452(1) of the Residential Tenancies Act 1997.
Kornucopia sub–leases or licenses apartments to occupants for short stays.[2] Counsel for the plaintiff informed the Court that the number of such properties is ‘in the hundreds’.[3]
[2]Transcript of Proceedings, Kornucopia v Zhu (Supreme Court of Victoria, 29 May 2019), 58 (‘T’).
[3]T 58.
Kornucopia’s claim was based on the landlord’s duty to ensure that rented premises are maintained in good repair.[4] It claimed that the apartment ceased to be in good repair on 22 August 2018, when the licensee or sub–tenant reported that a gas cooktop on a stove in the apartment was not properly functioning. The complaint was that the cooktop had an intermittent flame that provided insufficient pressure to cook meals.
[4]Residential Tenancies Act 1997 s 68(1).
Mr S Kuksal, Kornucopia’s director at that date, called the landlord’s agent and said that the cooktop had stopped working. The landlord’s agent agreed with Kornucopia that the landlord would pay for the work necessary to return the cooktop to good repair.
Mr Kuksal called a tradesperson who attended the apartment and prepared an invoice reading ‘Gas pressure was [too] high, check and service the cooktop’. The invoice charged for a call-out fee, after-hours labour and GST only, amounting to $225.
Three months later, the landlord’s agent contacted the tradesperson to verify the invoice and conducted a ‘web chat’ with him. The agent produced ‘the text’ of part of that chat to the Tribunal. In it the tradesperson said that ‘there was no problem with the unit when we check it’. The tradesperson was asked ‘if the pressure was too high, can the cooktop still be used’, to which the tradesperson replied ‘yes, of course’.
The second invoice
At the landlord’s request, the tradesperson sent a second invoice to the landlord’s agent at the agent’s request. It had the additional words: ‘you can use the unit’. Kornucopia said that it only received the second invoice on the day of the hearing. The landlord claimed that it had sent the invoice by email the night before, but that probably takes the matter no further.
Mr Kuksal disputed the accuracy of the invoice. Ms Xu, the current director of Kornucopia, did not see the cooktop, but said that a colleague had seen it and told her that it was ‘barely working.’
VCAT’s reasons
The Tribunal Member at the end of detailed ex tempore reasons said:
As I am satisfied it is more likely than not that the gastop was in good repair on the 22nd of August 2018 and at any other time, I am not satisfied that the work paid for by the tenant to Aus Appliance Repairs was for the gastop to be returned to good repair, and therefore, I am not satisfied that the landlord is liable to reimburse the tenant for the costs of that invoice.
The significant features of the Member’s reasons were as follows. He referred to Kornucopia’s obligation to make out its case and that it was for Kornucopia to satisfy him that it was more likely than not that the cooktop was not in good repair on 22 August 2018, and that the work done by the tradesperson was to return the cooktop to good repair. He was not satisfied that Kornucopia had proved its case.
The Member noted the terms of the first invoice and that it contained no claim for a replacement part. He also gave significant weight to the exchange on web chat between the landlord’s representative and the tradesperson and the clarification it contained about the work done. He rejected the suggestion that the web chat record had been fraudulently created. He noted the tenant’s claim that the flame was too weak but gave that lesser weight.
The Member also noted that the landlord had sought clarification of the work done and had obtained and tendered a second invoice.
The landlord requested that the tradesperson put in writing that the cooktop could still be used. Parts of the web chats that was not provided to the Tribunal included the following exchange:
Landlord: Would you be able to email me that information?
Repairer: I already write that in the invoice.
Landlord: No, advising that even with high pressure, the cooktop can still be used.
Repairer: I send it to you.
The Member’s conclusion was that it was more likely than not that the cooktop was in good repair on 22 August 2018 and at any other time, and that he was not satisfied that the work paid for by the tenant to the tradesperson was for the cooktop to be returned to good repair. He was therefore not satisfied that the landlord was liable to reimburse the tenants for the costs of the service.
Information obtained by Kornucopia after completion of the VCAT proceeding
Ms Lulu Xu, a director of Kornucopia, explained in her affidavit how Kornucopia came into possession of additional information about the repair:
After the hearing, the tradesman who attended the apartment was contacted, to clarify what he had written to the Landlord’s agents. The tradesman made a statutory declaration dated 4 January 2019. Amongst other things, the tradesman described the communications that had taken place between him and the Landlord’s agents, and appended to his declaration, amongst other things, a complete copy of the web chat (as Appendix D). Amongst other things, the tradesman deposed that the appliance was faulty and ill–suited for its purpose, and that it was only restored to use after his repair.
Ms Xu states that on 10 January a copy of the tradesman declaration was sent to the landlord and Kornucopia foreshadowed its intention to bring this Supreme Court proceeding.
The tradesperson’s statutory declaration
The tradesperson stated in his statutory declaration that he tested the appliance and observed that the burners would not produce a flame and that he repaired it. He said that on 23 November 2018, three months after his original invoice, he was contacted by someone associated with the landlord and asked if there was anything wrong with the appliance. He said that he was slightly confused by this as the appliance had been fully fixed, after the pressure related fault was repaired, and had been restored to functionality. Thus, he advised the person that the unit ‘was okay’. He was asked to re–issue the invoice, but after making some changes. As he did not understand that the person requesting the modification was not associated with the customer, he cooperated with their request. He understood that he was sending the modified invoice to the director of the business that had engaged his services, Mr Kuksal. He then alleged that the agent had mischaracterised the facts and manipulated him into giving ambiguous statements which they had further doctored and misrepresented.
Kornucopia’s grounds
Kornucopia’s judicial review application contained the following grounds:
1. The Tribunal was misled.
The Order was based on findings that were based on evidence adduced by the first defendant’s agents, which evidence was misleading and which caused the Tribunal to be misled.
The evidence was in the nature of written statements of a third party to the Landlord’s agents in a ‘web chat’.
The web chat tendered was incomplete, and omitted communications between the Landlord’s agents and the third party that qualified the third party’s statements that were adduced or otherwise rendered them ambiguous.
By adducing the evidence and by failing to adduce evidence of the other communications, the first defendant’s agents engaged in conduct that caused the Tribunal to be misled, intending that the Tribunal would be misled or reckless as to whether the Tribunal would be misled.
2.The plaintiff was denied procedural fairness.
The evidence of the communications between the first defendant’s agents and the third party that the first defendant’s agents tendered was not disclosed to the plaintiff prior to the hearing.
In the circumstances, the plaintiff was deprived of the ability to make enquiries of the third party, in order to obtain the third party’s account of the communications, to ascertain the true import of the third party’s statements and to obtain evidence from the third party that would have contradicted or qualified the third party’s statements relied upon by the first defendant.
Counsel for Kornucopia developed these grounds at the hearing. He submitted that the landlord’s representatives had made a conscious decision not to produce the full web chat transcript at the Tribunal hearing. If the full transcript had been produced before the Member, then Kornucopia would have taken the opportunity to cross-examine in relation on it. The Tribunal was misled because not all the information was put before it. Kornucopia was not given the opportunity to confront and examine the tradesman, who was a relevant witness.[5] However, it did not allege that the landlord had committed fraud.
[5]Kornucopia relied on Leon Holdings Pty Ltd v O’Donnelland Another (2009) 25 VR 569 and Beling v Dimkosvski (2006) 24 VAR 152.
Kornucopia alleged that it had been ambushed at the hearing with the second invoice and only part of the web chat record had been produced. At the hearing it had no means of verifying the chat extract. It submitted that the lack of full disclosure, while not constituting fraud, established a denial of procedural fairness.
Where a party has been completely deprived of the ability to identify the key facts which might form the basis for cross-examination the Tribunal of its own motion should grant that right of cross-examination of a critical witness. It should have granted Kornucopia an adjournment for that purpose.
The landlord disputed these submissions. The Tribunal received a range of evidence and both versions of the web chat transcript contained a statement to the effect that the stove was working. Kornucopia was not ambushed as it knew that it had to prove its case, being that the stove needed repair and was repaired. The landlord’s agents gave evidence as to their investigation of the issues and contact with the tradesperson. The additional information obtained by Kornucopia would not have affected the Tribunal’s decision.
Analysis
The first ground
In my opinion, the Tribunal’s findings of fact were open to it and it was not misled by the evidence before it. The Tribunal considered all the evidence. The landlord was entitled to act on the basis that the tradesperson’s web chat responses meant that the cooktop had been capable of use throughout.
Kornucopia did not identify anything left out of the web chat extracts that the landlord provided the Tribunal which might have assisted its case. No fraud is suggested by the landlord. Kornucopia has not shown that the failure to provide the complete web chat conversation affected the outcome of the Tribunal application. Kornucopia’s case appears to have been that the tenant or its representatives may have been innocently confused about the work the tradesperson performed and that it had therefore innocently misled the Tribunal.
The Member was obliged to give weight to the evidence presented to him rather than to speculate about what the tradesperson would have said if called to give evidence.
The Tribunal made no jurisdictional error or error of law on the face of the record. It made findings of fact. The plaintiff does not suggest fraud by the landlord but rather, as I understood it, that the landlord had been confused by the tradesperson’s responses.
This is not an appeal. Kornucopia’s application is for orders in the nature of certiorari to quash the Tribunal’s decision. The authorities suggest that the non-disclosure of evidence in the absence of fraud will not establish a judicially reviewable error justifying the issue of certiorari.[6]
[6]See NASB v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCAFC 24, [43]–[55] (Beaumont, Lindgren and Tamberlin JJ).
To obtain certiorari, Kornucopia must show that the Tribunal made a jurisdictional error or an error of law on the face of the record. It has not established either. The first ground is therefore not made out.
The second ground
Kornucopia did not ask the Tribunal to adjourn the proceedings to carry out any enquiries. The outcome of the proceeding if the tradesperson had been called is speculative. He may have been cross-examined, but the outcome of the case in those circumstances cannot be known. His attack on the landlord’s agent in his statutory declaration may have weakened the effect of his evidence as it was not the basis of the case put in this Court.
In my opinion, the Tribunal did not deny Kornucopia procedural fairness or natural justice in the conduct of the hearing. Kornucopia’s case was clearly presented by its representatives, neither of whom sought an adjournment. It has to be borne in mind that this was a small claim and Kornucopia must have known, because of the non–payment of the invoice, that it would have to prove its case at the Tribunal hearing. That case was that the cooktop needed repair. Kornucopia did not did not call the tradesperson, nor did it ask the Tribunal for adjournment so that it could call him.
The second ground is not established.
Conclusion
The proceeding is dismissed.