Lew's Discount Carpet Pty Limited v Browseabout Markets Pty Limited and 2 Ors

NEW SOUTH WALES SUPREME COURT

CITATION: Lew's Discount Carpet Pty Limited v Browseabout Markets Pty Limited & 2 Ors [1999] NSWSC 905

CURRENT JURISDICTION: Administrative Law

FILE NUMBER(S): 30027/99

HEARING DATE{S): 1 September 1999

JUDGMENT DATE: 10/09/1999
PARTIES:

Lew's Discount Carpet Pty Limited
(Plaintiff)

Browseabout Markets Pty Limited
(First Defendant)

Barry Beeton
(Second Defendant)

Consumer Claims Tribunal
(Third Defendant)

JUDGMENT OF: Master Harrison

LOWER COURT JURISDICTION: Not Applicable

LOWER COURT FILE NUMBER(S): Not Applicable

LOWER COURT JUDICIAL OFFICER: Not Applicable

COUNSEL:
Mr C Stomo
(Plaintiff)

Mr M Carey
(First Defendant)

N/A
(Second Defendant)

Mr Lakatos
(Third Defendant)

SOLICITORS:
Johnston Vaughan, Kogarah
(Plaintiff)

Kennedy & Cooke, Batemans Bay
(First Defendant)

Crown Solicitor
(Third Defendant)

CATCHWORDS:
Quash orders of Consumer Claims Tribunal
Denial of natural justice

ACTS CITED:
Consumer Claims Tribunal Act 1987
Consumer Claims Act 1998

DECISION:
See para 30

JUDGMENT:

THE SUPREME COURT
OF NEW SOUTH WALES
ADMINISTRATIVE LAW DIVISION
MASTER HARRISON
FRIDAY, 10 SEPTEMBER 1999
30027/99   -   LEW’S DISCOUNT CARPET PTY LIMITED v
  BROWSEABOUT MARKETS PTY LIMITED
  & 2 ORS
JUDGMENT     (Quash orders of Consumer Claims Tribunal;
Denial of natural justice)

MASTER: By amended summons filed 22 April 1999 the plaintiff seeks orders firstly, that the decision made on 4 February 1999 in proceedings No TSY98/1443 of the Consumer Claims Tribunal (the Tribunal) be set aside; secondly, that the first defendant be restrained from enforcing or otherwise acting upon the decision of the tribunal and proceedings No 7 of 1999 at the Local Court Batemans Bay; thirdly, that the proceedings before the tribunal be declared null and void and fourthly, a declaration that the tribunal did not hear or determine the said proceedings according to the rules of natural justice.
By notice of motion filed 18 May 1999 the plaintiff seeks a declaration that the monies paid by the plaintiff to the Sheriff on 21 April 1999 were paid in error and an order that the first defendant direct the Sheriff at Fairfield to repay the monies to the plaintiff forthwith. If the summons is dismissed it follows that the notice of motion should also be dismissed. The plaintiff relied on an affidavit of Leo Lewin sworn 15 June 1999. The first defendant did not rely on any affidavit evidence. The parties to these proceedings are Lew’s Discount Carpet Pty Limited (plaintiff), Browseabout Markets Pty Limited (first defendant) (Browseabout), Barry Beeton (second defendant) and the Consumer Claims Tribunal (third Defendant). It has filed a submitting appearance.
The second defendant by the affidavit of his solicitor David Francis Hawdon sworn 19 May 1999 stated that he be excused from further appearance in these proceedings (para 11). He did not appear. Pursuant to s 44(1) of the Consumer Claims Tribunal Act 1987, the Minister of Fair Trading sought and was granted leave to intervene in these proceedings. It should be added as fourth defendant and I make such an order.
The facts are as follows:
(1)Mr Leo Lewin is a director of the plaintiff company.
(2)The plaintiff was joined as a party to proceedings before the Consumer Claims Tribunal No TSY98/1443. Browseabout brought proceedings against Mr Barry Beeton and Lew’s Discount Carpet Pty Limited.
(3)On 15 January 1999 the Tribunal issued a notice to the plaintiff advising it that the matter was listed for hearing at Batemans Bay Court house on 4 February 1999. There is no dispute that the plaintiff received this notice.
(4)On 15 January 1999 Mr Lewin did not attend before the Tribunal. The Tribunal heard the consumer claim.
(5)On 2 March 1999 the plaintiff wrote to the registrar Consumer Claims Tribunal at Wollongong. He stated that he was not able to attend the tribunal hearing on 4 February 1999 due to ill health. The letter further stated that he had been confined to bed and had only recently been able to return to work and had been unable to carry out business commitments and unable to contact the registry sooner. Mr Lewin’s evidence is that he was suffering from chronic tonsillitis, was unable to speak and was confined to bed. The letter attached medical certificates (the one of 9 February 1999 is not in evidence). The medical certificate of Dr Singh is dated 2 March 1999 and recorded that when Mr Lewin was examined on 3 February 1999, he was suffering from a severe upper respiratory infection with a high fever, was confined to bed and unable to work. The letter also explained that Mr Lewin was the only person who had authority to make decisions for the company. The letter concluded by requesting a rehearing.
(6)On 10 March 1999 judgment was entered in favour of Browseabout Markets Pty Limited against Lew’s Discount Carpet Pty Limited in the local court at Batemans Bay for the sum of $6,536.
(7)On 18 March 1999 the registry wrote to the plaintiff and advised it that the Tribunal had reviewed his application and decided not to grant a rehearing on the claim and that the Tribunal’s order of 4 February 1999 was still in effect.
(8)On 22 March 1999 the registry forwarded the Tribunal’s decision to the plaintiff. The Tribunal decided a fair and reasonable amount to be paid by Lew’s Discount Carpet Pty Limited to Browseabout was $6,490. Browseabout had claimed $8,300.
(9)A writ of execution issued for the sum of $6,536.
Mr Lewin submitted that he was denied natural justice because he was not allowed to put the company’s view before the Tribunal, namely that the plaintiff has never warranted that the carpet provided to the first defendant was a commercial quality carpet.
The Law
The plaintiff relied on s 12(2)(b)(ii) of the Consumer Claims Tribunal Act 1987 which gives this court the jurisdiction to grant relief in relation to the hearing or determination of the claim if a party has been denied natural justice. No appeal lies to this court where errors of fact or law have occurred.
At the outset, it is helpful to set out some of the provisions of the Consumer Claims Tribunal Act 1987. The Tribunal is not constrained by the rigour of the court room. In a sense, its function is to mete out rough justice or at least a less than perfect form of justice in an economical way appropriate for disputes within the limits of its jurisdiction. Evidence before the Tribunal must be relevant to the determination of a claim (s 23(1) of the Consumer Claims Tribunal Act 1987 as amended) and must be given on oath or statutory declaration (s 23(2) - s 23(3)) but the Tribunal is not bound by the rules or practice of evidence and the Tribunal may inform itself on any matter in such manner as it considers appropriate (s 23(4) - see also s 29(4)). Its business is conducted in private (s 22(1)). There is no requirement that Referees constituting the Tribunal be legally qualified. The orders of the Tribunal must, in its opinion, be “fair and equitable” (s 31(1)). The tribunal has no power to award costs (s 28). Pursuant to s 29 of the Act the Tribunal is obliged to use its best endeavours to bring the parties to a settlement before making any order.
In Hutley v Meigan & Ors (1997) ASC 65-370, Rolfe J referred to the often quoted and, if I may respectfully say so, the helpful comments of Hunt J (as he then was) in Singer v Statutory and Other Officers Remuneration Tribunal (1986) 5 NSWLR 633 and those of Simpson J in Archcom Pty Limited v Consumer Claims Tribunal & Ors (NSWSC, 29 September 1995, unreported) which deal with the nature of the proceedings in the Consumer Claims Tribunal.
The Tribunal has been established to deal with small claims in a relatively informal and expeditious manner. As Hunt J said in Singer at p 635:
“The Consumer Tribunal Act 1974 has set up a system for the speedy and inexpensive disposal of certain claims, limited in amount, arising out of contracts for the supply of goods or the provision of services by a person carrying on (or holding himself out as carrying on) the business of supplying such goods or providing such services. The tribunal hearing such claims is constituted by a referee, who need not have (and who in many cases does not have) legal qualification.”
As Simpson J said in Archcom at p 12 after referring to the remarks of Hunt J:
“Those remarks were made in the context of the predecessor of the Act, a 1974 Act by the same title, but they apply equally to the Act. Underpinning the Act is a policy of providing expeditious access to an inexpensive and informal process for the resolution of consumer disputes involving relatively small amounts of money. Speed and economy are to be accompanied and (it is hoped) often achieved, by informality.”
Her Honour continued, at pp 13-14:
“The intention of the legislature, in creating these tribunals as a forum for the resolution of disputes involving relatively small amounts of money was the achievement of expeditious and inexpensive justice between the parties while maintaining a proper regard for, and protection of, the rights of the parties to the dispute. The difficulty, as I see it, lies in striking the correct balance between those two goals. Speedy and inexpensive solutions may be inimicable to the protection of rights. There is no necessary relationship between the factual or legal complexity and the quantum of a claim but legal rights and obligations remain at the heart of the tribunal’s jurisdiction. Although a tribunal is enjoined to make such orders as will, in its opinion, be fair and equitable to all parties to the claim (s 31(1)), those orders must be grounded in legal liability.”
Her Honour thus stressed the need for “justice” and the “protection of rights”.
In relation to natural justice, Professor S A de Smith, Judicial Review of Administrative Act, 2nd ed., pp 180-181 has stated:
“Natural justice generally required that persons liable to be directly affected by proposed administrative acts, decisions or proceedings be given adequate notice of what is proposed, so that they may be in a position: (a) to make representations on their own behalf; or (b) to appear at a hearing or inquiry (if one is to be held); and (c) effectively to prepare their own case and to answer the case (if any) they have to meet.”
In Kioa v West (1985) 159 CLR 550 the High Court held that the duty to accord natural justice is a duty to act fairly. In the normal course, a party to judicial proceedings (as are those in a tribunal) could expect to be apprised of the nature of the case sought to be made against it, and of the date and time fixed for hearing such as to give it a reasonable opportunity to meet that case and to advance its own. These statements are similar to those expressed by Professor de Smith and referred to earlier. Brennan J (as he then was) at p 628 stated:
“A person whose interests are likely to be affected by an exercise of power must be given an opportunity to deal with relevant matters adverse to his interest which the repository of the power proposes to take into account in deciding upon its exercise.”
In relation to procedural fairness, Mason J stated in Kioa that the law had now developed to a point where it may be accepted that there is a common law duty to act fairly, in the sense of according procedural fairness, in the making of administrative decisions which affect the rights, interests and legitimate expectations, subject only to the clear manifestation of a contrary statutory intention. Procedural fairness is a notion of a flexible obligation to adopt fair procedures which are appropriate and adapted to the circumstances of the particular case (pp 454 and 455).
The plaintiff referred to Davies v Paggett (1986) 10 FCR 226 and Cohen v McWilliam (1995) 38 NSWLR 476 which involve the considerations that apply to the setting aside of a default judgment. In Cohen Priestley JA stated:
“…The fundamental duty of the court is to do justice between the parties. It is, in turn, fundamental to that duty that the parties should each be allowed a proper opportunity to put their cases upon the merits of the matter. Any limitation upon that opportunity will generally be justified only on the necessity to avoid prejudice to the interests of some other party, occasioned by misconduct.”
The parties agreed that the passage quoted above sets out the rules of natural justice at common law.
However, the third defendant submitted that the legislation namely Consumer Claims Tribunal Act 1987 has modified the common law rules of natural justice.
On 1 March 1999 the Consumer Claims Tribunal Act 1987 was repealed by the Consumer Claims Act 1998. The Consumer Claims Act 1998 commenced on 1 March 1999. By virtue of Schedule 1 to the Consumer Claims Act 1998, the Consumer Claims Tribunal Act 1987 applied to matters that had not been finally determined by the Consumer Claims Tribunal.
A number of further provisions of the Act are relevant. Section 14 provides that the registrar of the Tribunal must when the initial hearing is deferred, cause notice of the time and place fixed for hearing to be served on all interested parties - s 14(1)(d) and (7). Section 20 empowers the Tribunal to adjourn the case from time to time and if the matter is adjourned, the registrar must cause notice of the time and place fixed for hearing to be served on the parties - s 20(2). Section 40 provides that it is sufficient for service of notices under the Act, that the notice be posted by pre-paid mail to the person’s usual or last known address. It is common ground that the Tribunal complied with the notice requirements and the plaintiff received those notices.
Section 17(1) provides that except as expressly provided by the Act and regulations, the Tribunal in exercising its functions, must conform to the rules of natural justice. Section 21(1) provides that subject to the section, a party has the carriage of the party’s case. Section 21(2) provides that a party is not entitled to be represented unless the party is a corporation and it is represented by one of its officers - subsection (a); or the tribunal decides that a party would be disadvantaged if not represented - subsection (j); or in any other case, representation is approved by the tribunal - subsection (k).
Section 24(1) provides:
“(1)Subject to s 25, if at the hearing of a consumer claim by a tribunal the case of a party to a claim is not represented to the tribunal:
(a)the tribunal must decide the issues in dispute on such evidence as is otherwise adduced before it, and
(b)an order made by the tribunal to determine the claim is just as effective as if that party had been fully heard.”
Thus if a party to the claim does not present a case to the Tribunal, the Tribunal must decide the issues in dispute upon the evidence before it. Section 25 provides for the rehearing of a consumer claim if the registrar is satisfied that there was sufficient reason for the party’s absence.
The most relevant authority is the Court of Appeal decision of McClelland v Acmil Industries Pty Limited (1983) 1 NSWLR 615. It involved a hearing before the Consumer Claims Tribunal under the Consumer Claims Tribunal Act 1974. Approximately 14 days before the hearing, the registrar of the Tribunal gave notice of the hearing, by post to the respondent. The notice was received at the address at which the respondent carried on business (as opposed to its principal office which was elsewhere) on the day before the hearing but was not received by the responsible officer until the day after the hearing. The Court of Appeal held that in these circumstances there was no denial of natural justice. Reference was made in the judgments to ss 14(1)(b), 34 and 37 of the 1974 Act (these provisions have materially similar counterparts in the Act being ss 14(1)(d) and (7), 17(1) and s 40).
Hope JA stated at p 617:
“In my opinion there is no basis in the terms of the legislation, which is essentially directed to the setting up of a fairly peremptory system of dealing with small claims, to construe the Act so as to require that a notice given by the registrar pursuant to s14(1)(b) should be received at a time which would enable the recipient to prepare his case for hearing.
…the Act is not to be construed to require that a notice is to be given at a time which will take into account the internal arrangements of the recipient. The notice… is a notice which is effective when it is received;…
…the requirement that the tribunal have regard, in the control of its procedures and the exercise of that control, to natural justice is subject to the Act and regulations. The Act requires the registrar to give a notice of the hearing and authorizes the service of that notice by post.
The notice is deemed to be sufficient if posted in accordance with the provisions of s 37. If a notice is served in accordance with the provisions of s 37 and
…is received at a time which would give an opportunity to the respondent to attend at the hearing before the tribunal, if acted upon at the time of receipt, there is, …no basis, whether by the application of s34 or otherwise, to deny the validity of the ensuing proceedings by reason of the time or manner of the service of the notice.”
Hutley JA commented that the provisions of the Consumer Claims Tribunal Act 1974 are designed to see that natural justice has very little role to play. Furthermore, the Tribunal itself cannot give effect to its ideas of natural justice because it is only subject to the Act and regulations that it can exercise control on the bases of natural justice. However, although it is true that there is provision for the court intervening under circumstances disclosing absence of natural justice, the occasions on which it will be able to intervene will be limited.
Mr Lewin who was to appear on behalf of the plaintiff before the tribunal was ill. Although he was able to attend a doctor the day before the hearing he did not cause a copy of this medical certificate to be faxed to the Tribunal to alert it that he would require an adjournment prior to the hearing. He has not provided an explanation as to why this did not occur. The case of the plaintiff was not presented to the Tribunal nor had the Tribunal received notification that Mr Lewin a representative of Lew’s Discount Carpet Pty Limited intended to appear but was ill. The Tribunal acted consistently with s 24(1) and decided the issues in dispute on the evidence adduced before it. It did not accept the whole of Browseabout’s claim and reduced it by $1,810.
The plaintiff’s application for a rehearing was made about one month after the claim had been heard. It is accepted that the plaintiff suffered a severe upper respiratory infection one day prior to the hearing but the plaintiff has perhaps overstated the level of disabilities brought about by the infection in that he was bed ridden for about one month. The plaintiff was forwarded a notice of rehearing in accordance with s 25. There is no evidence as to whether the plaintiff appeared at the rehearing and whether any further submissions or representations were made to it. The plaintiff has not demonstrated that the Tribunal did other than comply with s 25.
As was stated by Hutley J even if the circumstances disclose an absence of natural justice the occasions on which the court can intervene are limited. In this case, the court should not intervene. The plaintiff may have been treated harshly. However as the Tribunal complied with the requirements of the Consumer Claims Tribunal Act there has not been a denial of the rules of natural justice. The plaintiff’s claim must fail. Accordingly, the notice of motion and summons are dismissed. Costs are to follow the event. The plaintiff is to pay the defendants’ costs.

The orders I make are:
(1)The Minister of Fair Trading be added as fourth defendant.
(2)The notice of motion filed 18 May 1999 is dismissed.
(3)The amended summons is dismissed.
(4)The plaintiff is to pay the defendants’ costs.
(5)The plaintiff is to pay the costs of Minister for Fair Trading.
(6)The moneys held by either the Sheriff or the court be paid out to the first defendant’s solicitors Kennedy & Cooke, DX 4892 Batemans Bay.
(7)The stay of execution be removed.
**********

LAST UPDATED: 10/09/1999

[1999] NSWSC 905

10 September 1999