Naylor v Advaland Pty Ltd
[2014] VSC 331
•14 July 2014
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
JUDICIAL REVIEW AND APPEALS LIST
S CI 2013 3842
| MELISSA LOUISE NAYLOR | Applicant |
| v | |
| ADVALAND PTY LTD | First Respondent |
| - and - | |
| KITCHENER CRESPIN | Second Respondent |
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JUDGE: | LANSDOWNE AsJ |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 2 July 2014 |
DATE OF JUDGMENT: | 14 July 2014 |
CASE MAY BE CITED AS: | Naylor v Advaland Pty Ltd & Anor |
MEDIUM NEUTRAL CITATION: | [2014] VSC 331 |
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VCAT – leave to appeal out of time – undefended application – substantial delay sufficiently explained and no prejudice claimed – an arguable case for leave to appeal shown on some grounds – leave to appeal out of time granted
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APPEARANCES: | Counsel | Solicitors |
| The Applicant appeared in person | ||
| For the Respondents | No appearance |
TABLE OF CONTENTS
Introduction......................................................................................................................................... 1
The test for leave to appeal............................................................................................................... 3
Should leave be granted out of time?............................................................................................. 3
Draft notice of appeal dated 16 June 2014..................................................................................... 4
A:..... Building code....................................................................................................................... 5
B:..... Domestic building warranty insurance............................................................................ 7
C:..... Lack of cross-examination opportunity......................................................................... 11
D:..... Foreshadowing reasoning during hearing.................................................................... 12
E:..... Failure to deal with claim/allegation............................................................................ 16
F:..... Costs.................................................................................................................................... 18
Conclusion......................................................................................................................................... 19
Orders................................................................................................................................................. 19
HER HONOUR:
Introduction
This is an application for leave to appeal out of time from orders made by the Victorian Civil and Administrative Tribunal (“VCAT” or “the Tribunal”) on 27 June 2013. The applicant had made application to VCAT in the Domestic Building List in respect of concerns arising out of a domestic building contract between her and the first respondent to construct a bathroom at her premises. In her application dated 17 November 2012, the applicant sought the sum of $41,500.00. In final particulars of her claim dated 19 June 2013 she sought the sum of $69,776.00 including rectification costs of $54,758.00, costs incurred in the application of $2,400.00 and other damages.
The contract price was $37,225.70. By counterclaim the first respondent sought the sum of $6,540.46 said to be owing pursuant to the contract and damages for defamation.
The written record of the orders made 27 June 2013, the day of the hearing by Member R. Buchanan records the orders as follows:
(1) The First Respondent must pay $2,862.93 to the Applicant;
(2) The proceeding is struck out as against the Second Respondent;
(3)On or before 29 July 2013 the First Respondent must give the Applicant:
(a)evidence of builders warranty insurance for the works which were the subject of the contract between the parties dated 10 November 2011 (“the Works”);
(b)compliance certificates for plumbing and electricity for the Works;
(c) manuals for the spa bath and the hot water service.
(3)Liberty is reserved to the Applicant to apply for further orders if the First Respondent does not comply with orders (2)(a) and (b).
As will be seen, the order expressed in the second (3) differs in a material respect from the intention expressed by the Member in his oral and written reasons. In his reasons, the Member specifically limited the liberty to apply to the compliance certificates, and did not include the provision of evidence of insurance. I will return to this issue later in these reasons.
The orders made that day do not specifically deal with the defamation claim but the Member made it plain in his introductory discussion with counsel who appeared for the respondents for a limited purpose at the commencement of the hearing only that he did not consider he had any jurisdiction to deal with the defamation claim.
The applicant sought leave to appeal by originating motion filed 26 July 2013. Section 148(2)(a) of the Victorian Civil and Administrative Tribunal Act 1998 (“the VCAT Act”) provides that application for leave to appeal must be made no later than 28 days after the day of the order of the Tribunal. Accordingly, the originating motion was slightly out of time. More significantly, the applicant did not progress the application until she filed her summons on 30 December 2013 more than five months later. The first return date of that summons was 28 February 2014 and on that date the applicant relied on an undated draft notice of appeal exhibited to an affidavit sworn by her on 6 February 2014. That draft notice of appeal was not in acceptable form. By orders made 11 March 2014 I gave the applicant an opportunity to redraw her draft notice of appeal. Her first attempt dated 31 March 2014 was also not in acceptable form. By orders made on 2 May 2014 I afforded the applicant one further opportunity and this further opportunity resulted in a draft notice of appeal dated 16 June 2014 which had evidently been prepared with some legal assistance.
That notice of appeal was in acceptable form and accordingly I heard the applicant on it on 2 July 2014. The respondents did not attend on that date or any prior date notwithstanding that I was satisfied on each occasion that they had been given notice of the date and served with relevant documents. The applicant’s application was accordingly unopposed but nevertheless she must establish that leave to appeal should be granted and should be granted out of time. The lapse of time between the orders and the hearing of her application is now just over a year.
The test for leave to appeal
Section 148 of the VCAT Act provides for appeal from an order of VCAT, but only on a question of law and only where leave is granted. Leave is considered by an associate judge of this Court, and, if granted, the appeal is heard by a judge.
The test for leave to appeal a decision of VCAT is as set out in Myers v Medical Practitioners’ Board of Victoria[1] (“Myers”), which adopted the test as previously determined by Phillips JA in Secretary to the Department of Premier and Cabinet v Hulls (“Hulls”) [2]. I set out below the well known passage of the judgment of Phillips JA in Hulls, also cited in Myers:
When leave is sought to appeal under s. 148, it will be necessary for the applicant to identify a question of law which is relevant to the granting of the relief sought on appeal. The importance of the question, either generally or to the would-be appellant in the particular case, will probably be relevant. The applicant must show that there is a real or significant argument to be put on that question of law at least to this extent: that there is sufficient doubt about it to justify the grant of leave. Moreover, it may have to be shown that to allow the error to go uncorrected would impose substantial injustice, although, where the order below is final, that injustice will often be more readily discernible.[3]
[1][2007] VSCA 163
[2][1999] 3 VR 331
[3]Ibid, at 337
Should leave be granted out of time?
Section 148(2)(b) of the VCAT Act provides that the application for leave to appeal must be made in accordance with the rules of the Supreme Court. Rules 4.07 and 4.08 of the Supreme Court (Miscellaneous Civil Proceedings) Rules 2008 provide that within seven days of filing the originating motion the applicant must file a summons and affidavit in relation to the application for leave to appeal. As noted above, the applicant was a few days late in filing her originating motion. Where written reasons are requested, as they were here, time does not commence to run until the reasons are provided to that party (and here the reasons were dated 2 August 2013). Here the originating motion was filed before that date and so this provision does not assist the applicant expressly, but given its intent I would not, in the absence of objection from the respondents, be troubled by the few days by which the originating motion was out of time. Section 148 (5) of the VCAT Act permits the time within which the application for leave to appeal is made to be extended.
The more significant delay occurred in relation to the filing of the affidavit and summons, and thereafter due to the defects in the draft notices of appeal. In considering whether to extend time, the Court will have regard to the length of the delay, the reasons for it, whether there is a case for leave to appeal and the extent of any prejudice to the respondents. The personal reasons for the delay between July and December 2013 are set out in the applicant’s affidavit sworn 30 December 2013. Throughout that period she was pregnant with her second set of twins in two years, attempting to work full time while caring for her first set of twins with limited family assistance and limited child care. In relation to obtaining the material necessary for the application, the applicant deposes that she did not receive the transcript of the hearing on 27 June 2013 until 2 September 2013. It is also apparent from the material she has filed that she attempted to resolve her concerns in relation to the orders of 27 June 2013 by relisting the proceedings, which occurred on
1 October 2013. She then sought the transcript of that hearing, which she did not obtain until 21 October 2013. In relation to the period between October and December, the applicant deposes that she and her husband separated in November 2013.
These matters provide explanation for the delay. Explanation is, however, not sufficient unless there is utility in the extension i.e. there are questions of law on which leave to appeal would be given. Further, if such a lengthy extension caused prejudice to the respondents then it may not be justified. The respondents have not, however, attended court or filed any material to oppose the application or claim any prejudice from the lapse of time. In those circumstances, I would extend time if there is a basis otherwise to grant leave to appeal. I will now turn to examination of that issue.
Draft notice of appeal dated 16 June 2014
This draft notice of appeal contains 17 proposed questions of law under six headings A to F. The applicant made oral submissions in relation to each question and directed me to relevant portions of the transcript and the written reasons provided by the VCAT.
A: Building code
Questions of law 1 to 4 are directed to the relationship between the Tribunal’s findings as to defective work and compliance with the building code. They posit that building work cannot be found acceptable unless it complies with the applicable building code, in particular where the contract requires compliance with the building code.
Questions of law 5 to 7 are directed to the relationship between remedial works, the building code and the contract, and posit that remedial works ordered by the Tribunal must be those that comply with the building code and the contract.
The Tribunal found that there were defects with the work, but made no reference to compliance or lack thereof with the building code either in relation to quality of the work or in relation to the remedial works it found to be sufficient.
As principles of law posed in the abstract, the statement that building work and a contract that requires compliance with the building code is defective if it does not so comply, and that remedial work is only appropriate if it complies with the contract, are persuasive.
The issue here, however, is whether the claimed errors of law in failing to apply these principles truly arise from the case as presented by the applicant at the Tribunal. This is because it is rare that an argument may be put on appeal that was not put below, and generally this will not be permitted if different evidence would have been required below. The rationale for this principle is the need for finality in litigation, and that litigants are generally bound by the way they have presented their case at trial.
The grounds to these proposed questions of law place them in the factual context of this case. The grounds show that the questions are directed to the Tribunal’s finding that the shower base was not defective. It was a major component of the applicant’s case that water flowed out of the shower onto the floor of the bathroom in normal operation of one of the two showerheads. The Tribunal found in relation to this contention:
I believe that the shower enclosures design makes it inevitable that there will be water hitting the gap at the bottom of the shower door and I am not convinced by the evidence that the shower base is necessarily defective.[4]
[4]Tribunal Reasons dated 2 August 2013, at [24], Exhibit MN-27 to the affidavit of Melissa Naylor sworn 30 December 2013.
In other words the Tribunal found that the problem with the shower stemmed from its design, which had been supplied by the applicant to the respondent. In this context the Tribunal added:
I am troubled by the notion that a builder, presented with a request to build a shower enclosure to a design which would inevitably produce a lot of water getting underneath the door of the shower would be at fault for having built simply what he was asked to build.[5]
[5]At [25] of the Reasons.
A difficulty for the applicant is that, as she concedes, she made only one express reference to the building code at the hearing.[6] This was in the context of discussing the shower, but her submission was not elaborated as to the exact manner in which the work as done failed to comply with the building code. Further, she made no express reference to the inclusion of the building code in the contract.
[6]At Transcript page 41.
The contract was before the Member, and I assume for the purposes of this application that it did contain a provision that the work must comply with the building code. There is also reference to failure to comply with the building code in the applicant’s final particulars of claim, which were also before the Member. There may also have been reference to the building code in her original application. However, the Tribunal alerted the parties on a number of occasions that they should not assume he had read any documents they had filed, and that they must put their whole case before him orally.[7]
[7]Transcript pages 15, 16, 20 and 62.
What was also before the Member, however, was the Archicentre report obtained by the applicant. That report includes express reference to the requirements of the building code that had not been complied with in the construction of the shower base and installation of the shower screen. The report recommended removal of the existing shower facilities and rectification to the conform to the building code.
Given these express references to the relevant requirements of the building code in the evidence before the Tribunal, I consider it arguable that the Tribunal erred in failing to address whether the shower work complied with the building code and whether the remediation proposed would conform to the building code. Accordingly, I would grant leave to appeal in respect of questions 1-7 as limited by grounds 1-7 to relate to the shower only.
B: Domestic building warranty insurance
Questions of law 8 and 9 relate to the Tribunal order that the first respondent must supply the applicant with evidence of building warranty insurance after the event. The questions contend that the Tribunal should have given consideration to the following issues in the making of that order:
(a) that there was no right in the appellant to enforce the obtaining such insurance;
(b) that there was no remedy to the appellant if the order was not complied with; and
(c) neither the Tribunal nor the Supreme Court has power to enforce any third party insurer to provide such insurance.
There was no dispute at the Tribunal that the respondent had not taken out domestic building warranty insurance for the work. Mr Crespin’s evidence was that this was an inadvertent omission and that he could now obtain insurance ie retrospectively.[8]
[8]Transcript page 103-104.
The applicant concedes that she did not put the matters set out in paragraphs (a) to (c) of these questions of law to the Tribunal at the hearing on 27 June 2013. She now asserts that the first respondent was never going to be able to obtain insurance because the second respondent was not licensed as a builder. The licensing issue was touched on briefly in the evidence before the Tribunal. Mr Crespin asserted that he was licensed, the applicant asserted that he was not. There was no independent evidence such as could be provided by a search of the publicly available register. The applicant concedes she did not adduce evidence from the register at the Tribunal, but submits that nor did the Tribunal ask. The Tribunal made no finding as to whether or not Mr Crespin was licensed. The applicant did not at the hearing on 27 June 2013 draw the connection she now draws between absence of a licence and inability to obtain insurance.
The Tribunal made the following comments in relation to insurance:
The certificate of insurance must be provided. In addition there are no compliance certificates for electricity and plumbing and there are missing manuals for the spa and hot water service. I will order that all of those should be supplied within 30 days and in relation to the compliance certificates I will reserve liberty to apply. In the event that they are not supplied in time Ms Naylor can apply to the Tribunal for the cost of obtaining them herself. If there is a cost involved in making the works compliant before the tradesperson will give you that certificate, then that would be part of the claim that I would allow.[9]
[9]Reasons at [31].
Proof of insurance was not subsequently supplied and the applicant relisted the proceedings pursuant to the liberty to apply. The proceedings came back before the Tribunal on 1 October 2013.
In her first draft notice of appeal the applicant sought to appeal the orders made by the Tribunal on 1 October 2013, as well as those made on 27 June 2013. When that draft notice of appeal came before me on 28 February 2014 I informed the applicant that she would need to make separate application in respect of the orders made on 1 October 2013. She did not do so, and subsequent drafts of the notice of appeal have removed reference to the orders made on 1 October 2013.
At the hearing of the application before me the applicant invited me to read the transcript of the hearing of 1 October 2013 to the extent it might illuminate the Tribunal’s reasoning in the orders made on 27 June 2013. I refused at that time but on reflection have reached the view that it would be appropriate and I have read the transcript. I considered it appropriate to do so because the Tribunal on the face of the Reasons at paragraph 31 gave liberty to apply only in respect to the compliance certificates, and not in relation to the production of retrospective insurance. This was inconsistent with the orders as separately sent to the applicant. I read the transcript of the hearing of 1 October 2013 to ascertain the Tribunal’s intent given this inconsistency.
The transcript makes it quite plain that the Member intended to granted liberty to apply only in relation to the compliance certificates and not in relation to insurance. His view as set out in that transcript was that the order in relation to insurance could be enforced pursuant to s 122 of the VCAT Act.[10]
[10]VCAT Transcript 1 October 2013, Exhibit MN-30 to the affidavit of Melissa Naylor sworn 30 December 2013 at page 2.
Section 122 of the VCAT Act provides as follows:
122 Enforcement of non-monetary orders
(1)A person may enforce a non-monetary order by filing in the Supreme Court—
(a)a copy of the order certified by a presidential member or the principal registrar to be a true copy; and
(b)that person's affidavit as to the non-compliance with the order; and
(c)a certificate from a judicial member or the principal registrar stating that the order is appropriate for filing in the Supreme Court.
(2)No charge is to be made for filing a copy of an order, an affidavit or a certificate under this section.
(3)On filing, the order must be taken to be an order of the Supreme Court, and may be enforced accordingly.
There is no evidence before me as to whether or not the applicant has taken steps pursuant to s 122 and she made no submissions on that section before me (although in fairness this may have been because I indicated I would not read the transcript of 1 October 2013). If s 122 provides an adequate remedy for the failure of the respondent to comply with the order to provide evidence of building warranty insurance, then the applicant would be unable to show substantial injustice arising from the Tribunal’s order or indeed any error. Section 122 would provide an adequate remedy, for example, if the Supreme Court was able to make a monetary order for appropriate damages on proof that insurance could not be obtained.
Although the applicant did not put the arguments she now puts before the Tribunal in relation to the impossibility of obtaining insurance, she did assert that the builder was unlicensed and in my view it is arguable that this should have raised in the Tribunal’s mind a question as to whether if that was correct, insurance could ever now be obtained. The Tribunal’s consideration of the insurance issue was very brief and no recourse was given by liberty to apply should the order not be complied with. Having regard to all those circumstances, I consider it arguable that the Tribunal erred in making this order without further consideration or the grant of liberty to apply and would grant leave to appeal in respect of question 8 and 9.
Question 10 asserts that the Tribunal should have considered certain matters prior to “concluding that a counterclaim by a party in breach of contract for the unpaid balance of the contract price should be successful”.
The Tribunal made no express order in relation to the counterclaim but did set off the balance owing under the contract against the amount that the Tribunal otherwise found the first respondent was required to pay for remedial works.
The applicant conceded that the full contract price had not been paid.[11] She does not quarrel with the Tribunal’s calculations as to the amount owing. The clear intention of the Tribunal was to determine first the sum that the applicant should recover to bring the work to an acceptable standard. It is usual then for the amount owing under the contract to be off-set against this amount. Accordingly, I am not persuaded that there is any arguable error of law in relation to the Tribunal’s then setting-off against this amount the amount owing under the contract. I would refuse leave to appeal in respect of the question of law 10.
C: Lack of cross-examination opportunity
[11]Transcript page 30.
By questions 11 and 12, the applicant asserts that the parties were denied an opportunity to cross-examine each other after having been given an indication that they would have that opportunity.
The applicant conceded in her oral submission before me that she did not expressly ask the Tribunal for the opportunity to question Mr Crespin. She was also unable to identify where in the transcript the Tribunal said that this opportunity would be given. I have located one oblique reference by the Tribunal to such an opportunity in the course of Mr Crespin’s evidence when he, Mr Crespin, directed a question to Ms Naylor. The Member intervened in these terms:
No, don’t - - we actually could have ask (sic) questions and I might let you go back if you want to ask questions of Mrs Naylor but while you are talking to me I want you to direct statements to me.[12]
[12]Transcript page 69.
In a hearing before a court, even where parties are unrepresented, they would ordinarily be given an opportunity to question each other and each other’s witnesses. The Tribunal is, however, not bound by the rules of evidence or any practices or procedures applicable to courts of record and may inform itself on any matter as it sees fit.[13] The Tribunal is bound by the rules of natural justice, and in my view natural justice would require a party to have an opportunity to cross-examine if such an opportunity had been promised or sought. In my view, natural justice does not, however, require that an opportunity to cross-examine be necessarily offered in the Tribunal context.
[13]The Victorian Civil and Administrative Tribunal Act 1998 s 98.
Here, the Tribunal insisted on a number of occasions that the parties speak only to the Member and not to each other. Given the need to keep control of the hearing and the evident level of acrimony between the parties, I am not persuaded that this approach was incorrect. The Tribunal gave an opportunity to each party to put their case and specifically gave the applicant an opportunity to reply when she requested it.[14]
[14]Transcript 128-129.
For these reasons I do not consider that questions of law 11 and 12 identify any arguable error in this particular hearing from the absence of cross-examination and I would refuse leave to appeal in respect of them.
D: Foreshadowing reasoning during hearing
Question 13 asks:
Whether the appellant was denied natural justice by the Tribunal failing to foreshadow its proposed findings with the parties during the hearing prior to the announcement of reasons?
The question is put in factual context by ground 13. Ground 13 is as follows:
The Tribunal erred in law by depriving the appellant of natural justice in that the Tribunal made the following findings upon which the parties had no opportunity to make submissions prior to the Tribunal’s reasons being given, namely the findings that:
(a) that the ‘Bubbles quote’ was ‘excessive’;
(b)that the shower flooding could be remedied by refixing the silicone strip and attaching a metal strip to the wall;
(c)that retrospective insurance could be obtained;
(d)that retiling did not require re-waterproofing;
(e)that retiling of 36 metres² could be completed for $2,500;
(f)‘no harm befell Mrs Naylor’ from the failure to complete the contract;
(g)‘the building industry is incredibly imprecise about its ability to get jobs done on time’.
The matters identified in paragraphs (a) to (e) all relate to the Tribunal’s determination of appropriate remedies and the quantification of same. I will return to those matters in a moment. The matters identified in paragraphs (f) and (g) arose in the context of the Tribunal’s determination of the applicant’s claim against Mr Crespin personally for misleading or deceptive representations made prior to the entry into the contract. Those representations were directed to the work being completed before her first set of twins with whom she was then pregnant were born and the quality of the work. At paragraph 10 of the Reasons the Tribunal held as follows:
The reason I am dealing with all this is that it is obvious that the promise to get these works done on time for the babies to come early was very important and Ms Naylor would not have entered into the contract without it, but I do not think that there is any evidence to suggest that Mr Crespin made those representations in anything other than a relatively reasonable way. The building industry is imprecise about its ability to get things done in time. (No harm befell Ms Naylor or the twins because of any failure on the part of Mr Crespin to get the job completely finished by 24 January 2012). I do not think there was misleading or deceptive conduct on the part of Mr Crespin. I do not think it would be possible to say that he “knowingly authorised or permitted” a contravention of the provisions of the Fair Trading Act. I therefore do not think it is appropriate for me to make any finding against him as a director of the company.
I would refuse leave to appeal in respect of the matters identified at (f) and (g). I would do so because even if the Tribunal Member should in fairness have sought comment from the applicant about those matters prior to reaching its conclusions, the nature of the representations was such that in my view the Tribunal’s ultimate determination that there was no misleading or deceptive conduct is unarguable. The evidence was that the essential works in relation to the bathroom were completed by the dates stipulated in the contract or shortly thereafter, at least in the sense that the toilet, shower, basin etc were working.[15] Representations as to future events are only misleading or deceptive if not made on reasonable grounds and the Tribunal’s statement that the “building industry is imprecise about its ability to get things done in time” is no more in my view than a statement of a well-known fact. The other statement to which the applicant takes objection relating to no harm having fallen to her relates to the quantification of loss if misleading or deceptive conduct is found. This could only be a relevant error if there was error in the conclusion that there was no misleading or deceptive conduct. As indicated I do not consider that there is any such error of law shown.
[15]Tribunal Reasons at [9].
In relation to the determination of the appropriate remedy and quantification of loss, to which matters (a) to (e) relate, the Tribunal was in a difficult position. The applicant had obtained two inspection reports as to the defects (from Archicentre in relation to the shower and tiling as noted earlier and from HMM Inspections Services Pty Ltd in relation to the plumbing) and the Tribunal accepted their opinion as to the existence of the defects, with the exception of the shower base. The applicant had, however, limited evidence in relation to the cost of remedying these defects. The Tribunal identified this as a difficulty in the course of the hearing.[16] The applicant had a quote to remove the bathroom and redo it (the Bubbles quote) and an incomplete quote from another contractor.
[16]Transcript 127.
The quote from Bubbles well exceeded the original contract price. The quote was in the sum of $53,458.00 (and did not include necessary plumbing work) as compared with $37,225.70 being the contract price. Mr Crespin’s evidence was that Bubbles were the most expensive bathroom company in Victoria and his evidence was that repair costs were a far smaller magnitude.
I have examined the Bubbles quote. As the Member noted, it is not addressed to remediation, but is expressed in the form of a quote to create a new bathroom. Accordingly, it does not comment on what is wrong with the existing bathroom and how it can be remedied. Thus, while the quote contains items for waterproofing and tiling it does not specify that removal of the tiling would require re-waterproofing. Nor is this stated in the Archicentre report. Further, no cost is allocated to specific items. The only figure given is the total.
The applicant gave evidence that the Bubbles quote was of that magnitude because “it has to be pulled out and then redone”.[17] She also gave evidence of the difficulty of getting quotes from another tradesman to repair someone else’s defective work.[18] Thus there was some, although lay and limited, evidence before the Tribunal to justify the high cost of the Bubbles quote as appropriate remediation.
[17]Transcript 47.
[18]Transcript 47-48.
Given the form of the Bubbles quote, and the fact that there was some evidence that it was the only way to remediate the bathroom, I do not consider that any arguable error is shown in the Tribunal not giving the applicant an opportunity to comment on the matters identified in paragraphs (d) (retiling did not require re-waterproofing) and (e) (cost of retiling) of ground 13.
In relation to paragraph (a) (that the quote was excessive) in my view it was open to the Tribunal on this factual material to reach the conclusion that the Bubbles quote was not like for like with the contract price and accordingly was not a reliable guide to the cost of remedial work. The Tribunal preferred the respondent’s evidence finding:
Turning to the two quotations provided by Ms Naylor, one was from was Bubbles Bathrooms. Basically what Bubbles Bathrooms proposed to do was completely take out the old bathroom and put in a new one, at a price of $53,458.00. The price is so unrelated to the true commercial cost of this type of work for the quote is no guide to me at all. The price of the contract works charged by Avaland (sic) company is a better guide to what this sort of work should really cost.
The second quote provided by Ms Naylor was from a gentleman identified only as “Charlie” and was for $26,000.00. The quote does not include any allowance for the gas works and the hot water works and in addition it seemed to me to be excessive in view of the conclusions I have reached about the nature of the defects and what should be done by way of rectification.[19]
[19]Tribunal Reasons at [20]-[21].
I do not consider that arguable error of law is shown on the evidence before the Tribunal in this conclusion.
In two respects only I accept the applicant’s submission that arguably in fairness the Tribunal should have given the parties an opportunity to comment on a proposed solution. This is in respect of the metal stop on the side of the shower as well as a silicone strip. The Tribunal held:
I thought that a simple solution to the problem of water flowing out under the door would be to have some form of metal stop attached to the wall that the door can close on, as that would stop the water coming out of the side, where the screen joined the wall. The builder had installed a silicone strip at the foot of the door, to stop water flowing out from under the door, but that strip has been taken off or allowed to fall off and no attempt has been made to re-fix it. Things like that could be and should be done.[20]
[20]Tribunal Reasons at [24].
The applicant submits that this proposed remedy of a metal strip was both impractical and inconsistent with the building code. Additionally, it had not been suggested by either party. The transcript shows that submission to be correct. In those circumstances in my view arguably the Tribunal should have flagged that the possibility of that proposed remedy and allowed comment on it.
I also consider it arguable that the Tribunal should have allowed comment on the order that retrospective insurance be obtained. Although there was some discussion of insurance as referred to earlier in these Reasons, the Tribunal did not expressly flag that it would make an order for the obtaining of that insurance which would then have given the applicant a further opportunity to express objection to that course.
I would grant leave to appeal only in respect of grounds (b) and (c) to question 13.
E: Failure to deal with claim/allegation
Question 14 asserts error by the Tribunal in its failure to deal with certain causes of action identified in the final particulars of applicant’s claim. The causes of action listed are for breach of statutory duty, misleading and deceptive conduct, negligence, piercing the corporate veil, and various breaches of the Domestic Building Contracts Act and Building Act. The applicant has not identified where, if at all, in the transcript she took the Member expressly to allegations of breach of the Domestic Building Contracts Act and Building Act. She did expressly alert the Member to her claims of negligence to which he responded “this isn’t an action of negligence; it’s an action in contract”.[21] The applicant accepted in argument before me that no substantial difference arose from determination of her case against the respondents as breach of contract rather than negligence.
[21]Transcript page 132.
The applicant also expressly asked the Tribunal to deal with her claims of misleading and deceptive conduct and corporate veil arguments “that would make him personally liable”.[22] The Member said that he would deal with those matters and had read materials in relation to them. In the event, the Tribunal did not make express reference to “piercing the corporate veil” or to a breach of statutory duty in its Reasons.
[22]Transcript page 132.
The applicant sought to make submissions in relation to “piercing the corporate veil” so as to make Mr Crespin personally liable on the basis of a pattern of conduct by Mr Crespin in other matters.[23] The Tribunal declined to hear this evidence and I do not consider any arguable error arose from that approach. Before me, the applicant indicated that by “piercing the corporate veil” she intended to refer to the provisions for accessorial liability in the relevant statutory law and also that Mr Crespin “should be individually liable under common law principles” because the company was his alter ego and he was the sole director. In my view, these submissions show that the contentions were very general, and had limited prospect of success. I do not consider that any substantial injustice arose from the Tribunal failing to address them in the Reasons.
[23]Transcript page 133.
The Reasons show in my view that the Tribunal adequately dealt with the claim against Mr Crespin personally for misleading and deceptive conduct.
For these reasons I would refuse leave to appeal in respect of question 14.
Question 15 asserts that the Tribunal erred by failing to deal with the applicant’s allegations that Mr Crespin was not licensed and that the silicone strip had fallen off naturally.
Although the question as to whether or not Mr Crespin was licensed did arise, and the Tribunal made no finding in relation to it, it was not put by the applicant at least at that hearing as a central plank of her case. She did not produce objective evidence that the second respondent was not licensed. On balance, I do not consider that in these circumstances any arguable error arose from the failure of the Tribunal to make a finding in that regard. In relation to the silicone strip, this was one piece of evidence amongst evidence relating to over 20 defects. I do not consider that substantial injustice arose from any failure to address specific piece of evidence.
Question 16 posits that the Tribunal erred by “concluding Bubbles quote was excessive, without specific reference to or consideration of the individual items in that quote”. The grounds identify some particular items it is said the Tribunal failed to consider.
In my view no arguable error is identified by this question. The grounds do list some matters that were identified by the applicant at the hearing as defects, and subsequently not addressed by the Member in the proposed remediation. The error, if there was one, does not arise, however, from failure to consider the items in the Bubbles quote. As noted earlier, the Bubbles quote was not addressed to identifying individual defects and quoting to remedy them- it was an all-in figure for a whole new bathroom, without comment that this was the only way to remediate.
I would refuse leave to appeal in respect of question 16.
F: Costs
By question 17 the applicant seeks to challenge the Tribunal’s determination to refuse her application for the costs of obtaining reports. It posits that the Tribunal was in error in giving weight to the counterclaim. The Tribunal found as follows:
In the context of Ms Naylor’s claim, quite a lot of money was still to be paid to Avaland (sic). In a sense the position was rather balanced. The amount awarded to Ms Naylor is greater than the amount that she had conceded was owing to Avaland under the contract, but nevertheless, the amount owed to Avaland was a not inconsiderable sum.[24]
[24]Reasons at [34].
I do not consider that any arguable error of law is shown in the way the Tribunal approached the question of costs, given the conclusion it had reached as to the cost of remediation. If appeal is allowed and the matter remitted to the Tribunal, the costs then fall to be reconsidered. I do not consider however, that there is any independent ground of challenge to the determination as to costs. It is entirely conventional to consider when a costs application is made the degree of success of each party, and to weigh them against each other.
Conclusion
I would grant leave to appeal in respect of questions 1-7 (as limited by the grounds); 8 and 9 and grounds (b) and (c) of question 13. I would otherwise refuse leave to appeal.
As there are some questions on which the applicant has shown an arguable case, extension of time to seek leave to appeal would not be futile and I will extend time accordingly.
Orders
Orders for the progression of the appeal will accompany these reasons.
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