Salmond v S & S Accounting Services Pty Ltd
[2012] QCATA 218
•31 October 2012
| CITATION: | Salmond v S & S Accounting Services Pty Ltd [2012] QCATA 218 |
| PARTIES: | Kerrilyn Salmond (Appellant) |
| v | |
| S & S Accounting Services Pty Ltd (Respondent) |
| APPLICATION NUMBER: | APL126-12 |
| MATTER TYPE: | Appeals |
| HEARING DATE: | 31 October 2012 |
| HEARD AT: | Brisbane |
| DECISION OF: | Justice Alan Wilson, President |
| DELIVERED ON: | 31 October 2012 |
| DELIVERED AT: | Brisbane |
| ORDERS MADE: | 1 The application for leave to appeal is granted. 2 The orders made on 13 March 2012 are set aside. 3 This matter is remitted for rehearing before another adjudicator. |
| CATCHWORDS: | ADMINISTRATIVE LAW – ADMINISTRATIVE TRIBUNALS – QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL – where unrepresented respondent – where statutory requirement for tribunal to undertake investigative function – whether statutory requirements satisfied –- whether relevant evidence and issues disregarded – whether leave to appeal should be granted Queensland Civil and Administrative Tribunal Act 2009, ss 28, 29, 32, 57, 95, 98, 142 ALH Group Pty Ltd v Dicey’s Toowong Pty Ltd [2003] 2 Qd R 1 Glenwood Properties Pty Ltd v Delmoss Pty Ltd [1986] 2 Qd R 388 Grant v Repatriation Commission (1999) 57 ALD 1 Broussard v Minister for Local Government, Immigration and Ethnic Affairs (1989) 21 FCR 472 NSW Bar Association v Muirhead (1988) 14 NSWLR 173 QUYD Pty Ltd v Marvass Pty Ltd [2009] 1 Qd R 41 Re Ball and the Commonwealth (1987) 15 ALD 491 Sullivan v Department of Transport (1978) 20 ALR 232 |
APPEARANCES and REPRESENTATION (if any):
This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act).
REASONS FOR DECISION
On 13 March 2012, at Rockhampton, the Tribunal ordered the Appellant (“the client”) to pay the Respondent (“the accountants”) $3,660, being the balance of professional fees, and a filing fee of $95.
The client seeks leave to appeal that decision, and she requires leave to do so.[1] On that issue one must examine the proceedings at first instance to see whether there is a reasonably arguable case of error, which, if not corrected, will cause substantial injustice to the applicant[2], or a question of general importance upon which further argument and an appellate decision would be to the public advantage.[3]
[1] Queensland Civil and Administrative Tribunal Act 2009, s 142(3)(a)(i).
[2] QUYD Pty Ltd v Marvass Pty Ltd [2009] 1 Qd R 41.
[3]Glenwood Properties Pty Ltd v Delmoss Pty Ltd [1986] 2 Qd R 388 at 389; McIver Bulk Liquid Haulage Pty Ltd v Fruehauf Australia Pty Ltd [1989] 2 Qd R 577 at 578, 580.
The issues at first instance have to be gleaned from pleadings which (in the client’s case at any rate) were plainly drawn without professional assistance. It is undisputed that the parties agreed in writing, on 18 August 2003, that the accountants would render professional services to the client, chiefly the preparation and lodgement of tax returns.
It is also undisputed that, on or about 2 July 2008, the accountants delivered to the client an invoice claiming fees of $11,660, and that the client subsequently paid the accountants a lump sum of $5,000, and a further $3,000 by instalments, leaving an unpaid balance of $3,660.
In her response the client:
(1) Sought dismissal of the claim;
(2) Sought an order that the accountants repay to her the sum of $8,000[4];
(3) Alleged that:
(a)Despite “numerous inquiries” on her part, the accountants had delivered nothing to her by the time she closed her Moura business and moved to Tungamull, near Rockhampton, in 2005;
(b)Contrary to the agreement requiring quarterly bills, she received no bill from the accountants until July 2008;
(c)The July 2008 bill included a charge for preparing and lodging the client’s 1997 tax return, when that work had already been performed by another accountant in May 1998;
(d)The part-payments of $5,000 and $3,000 were made under pressure of ill health, demands for payment by the accountants and a debt collector, and fear of bankruptcy proceedings.
[4]If this counter-application proceeded, compliance with, or a dispensation from, rule 49 of the Queensland Civil and Administrative Tribunal Rules 2009 would be required.
In her Application for Leave to Appeal and her subsequent submissions the client says, in substance, that the primary decision maker:
(1) Erred in failing to find “abandonment” of the agreement (no such allegation was made in her Response, but I take it to be an allegation of non-performance);
(2) Should have found negligence, or negligent non-performance on the accountants’ part;
(3) Failed to take into account the accountants’ failure to deliver periodic bills.
In addition, the client repeats:
(1) That the part-payments totalling $8,000 were made under duress;
(2) That she is entitled to a refund of that amount; and
(3) The allegations contained in her Response.
In answer to the appeal the accountants submit that:
(1) The client requires leave to appeal;
(2) The client failed to comply with the accountants’ numerous requests for further information;
(3) The work was completed as soon as reasonably practicable;
(4) It was impractical to issue periodic statements;
(5) Prior to these proceedings the client expressed no dissatisfaction with their services;
(6) Part-payment of $8,000 has in fact been made; and
(7) No error in the primary decision is shown.
There are two versions of the primary decision – the original recorded electronically on 13 March 2012, and a printed one sent by the Deputy Registrar to the client on 15 March 2012. They differ in some respects, as noted below.
The oral evidence was taken in unsworn[5], narrative form, without cross-examination. So far as Tribunal proceedings are concerned, the term “evidence” refers to any relevant information; generally, the Tribunal is not bound by the rules of evidence or practices of the courts.[6] Evidence may be given orally or in writing.[7] Adversary procedure is a long-established practice of the courts, but subject to relevance and natural justice the Tribunal “may inform itself in any way it considers appropriate”[8]. It must act with as little formality and technicality as is lawfully possible, and must ensure, so far as practicable, that its decisions are based on all relevant material.[9] These desiderata are quite capable of including, for what they are worth, assertions contained in parties’ pleadings or other submissions to the Tribunal, particularly when a party is unrepresented, or some other inequality is apparent. The Tribunal’s investigative role may require it to initiate inquiries suggested by material already before it.[10]
[5] As permitted by the QCAT Act, ss 57(1)(a), 95(4)(b), 98(1)(b).
[6] Queensland Civil and Administrative Tribunal Act 2009, s 28(3)(b).
[7] Queensland Civil and Administrative Tribunal Act 2009, s 95(4)(a).
[8]Queensland Civil and Administrative Tribunal Act 2009, s 28(3)(c). This provision simply adopts the common law: ALH Group Pty Ltd v Dicey’s Toowong Pty Ltd [2003] 2 Qd R 1; Re Ball and Commonwealth of Australia (1987) 15 ALD 491; NSW Bar Association v Muirhead (1988) 14 NSWLR 173; Keller v Drainage Tribunal [1980] VR 449.
[9] Queensland Civil and Administrative Tribunal Act 2009, s 28(3)(d) and (e).
[10]Federal Commissioner of Taxation v Carberry (1988) 20 ATR 151; Broussard v Minister for Local Government, Immigration and Ethnic Affairs (1989) 98 ALR 180; Ekermawi v Administrative Decisions Tribunal of New South Wales [2009] NSWSC 143 at [56]; Grant v Repatriation Commission (1999) FCA 1629 at [18]: “An inquisitorial review conducted by the AAT ... is one in which the tribunal is required to determine the substantive issues raised by the material and evidence advanced before it and, in doing so, it is obliged not to limit its determination to the "case" articulated by an applicant if the evidence and material which it accepts, or does not reject, raises a case on a basis not articulated by the applicant”; Sullivan v Department of Transport (1978) 20 ALR 323.
The active, investigative role of the Tribunal is emphasised in the legislative mandate to take all reasonable steps to ensure that each party understands its practices and procedures, and to explain, as may seem necessary, the legal implications of assertions made.[11]
[11] Queensland Civil and Administrative Tribunal Act 2009, s 29(1)(a), (2(a).
These considerations need to be borne in mind when, as here, the Tribunal is constituted by a judicial officer who is accustomed to presiding in a court of law. The Member addressed twelve questions to the accountants’ representative, and seven to the client. Of those seven questions, four referred to her dealings with the Tax Office, and, at best, were marginally relevant to the issues for trial.
The proceedings at first instance were recorded electronically. However, I have had them transcribed for ease of reference.
The oral evidence[12] began with the accountants’ representative’s recital of the agreement made in 2003; the statement of fees rendered some five years later, particulars later supplied; and the balance owing. The representative/witness (Mr Swaffield) claimed that there were numerous conversations and letters asking the client for more detail, which the client did not supply (but which she said she could not supply, as she had already delivered all that was available). According to the client one such letter from the accountants went astray, because it was sent to an obsolete address, after she moved to Tungamull. However, in a letter to the client, dated 8 February 2011, and attached to the client’s Response, the accountants stated:
You asked how did we prepare the Tax Returns and Activity Statements from just a couple of discs? Yes we do have a number of discs but we also have a big blue tub of documents. From these discs and documentation we had enough sufficient [sic] information to prepare the tax returns and activity statements as per our invoice.
[12]That term is used throughout this decision in the non-technical sense explained at [9], above.
Without presuming to decide the issue of adequate instructions, the apparent inconsistency between Swaffield’s evidence and that letter may well have drawn some questions from the Tribunal. The particulars of the July 2008 account show that as late as 21 May 2008 the accountants tried – unsuccessfully, as it happened – to open computer discs containing the client’s financial records. It is possible, of course, that the discs were opened earlier, and later deteriorated, but another inference invited exploration, namely that the accountants still had not digested that material, six weeks before they delivered their one and only account. If that were the case, an excuse of insufficient instructions may have been less than convincing.
Contemplating an undisputed delay of some five years between engagement and professional performance, the Tribunal (in the electronic version of its decision) suggests a moral equivalence between a patient (or passive) client and a “tardy” firm of accountants:
It may be that the [accountants have] been tardy, but it would have been incumbent on the [client] at an earlier stage to have made demand ... for the documents to be prepared and if they weren’t prepared then request the return of the material and take ... other action.
That passage does not appear in the written decision, but that document contains this comment:
The reason for the delay is unclear but there is no evidence that the [client] had sought the documents or complained. [emphasis added]
However, in her Response the client asserted:
Business had folded and closed by 2004/05. Up until then, despite numerous inquiries, none of my accountancy work/tax returns had been done, as they were too busy!
And in her evidence:
I used to ring and ask had they had time to put it into system [sic] because I knew it was a big job and it was never ... they hadn’t had time to get to it in Biloela [branch office]. I got sick of contacting, by that time the business was winding up.
An investigative Tribunal might well have drawn this apparent conflict to the attention of the parties. In the event, the client’s evidence was ignored, and the conflict was not resolved.
The decision says very little about the client’s undisputed complaint, both in her Response and oral evidence, that the accountants did not send her quarterly statements of account, as the retainer stipulated. The possible implications of that omission for her allegation of negligent non-performance invited some inquiry. However, Mr Swaffield was not called upon to make a response to that complaint, nor did he volunteer one, although in the accountants’ submissions on appeal they assert that it was “not tenable” [sic] to do so. The electronic (but not the written) record of the decision states: “It would appear that much of the work was done late in the piece”. However, further and better particulars of the invoice of July 2008 show that work to the value of at least $1,030 was done in July-September 2004 and $920 worth in October-December 2004. The retainer required quarterly statements for any work in excess of $300. It may have assisted the client to know before July 2008 how her bill was accumulating.
In the course of the oral evidence, the Member asked Swaffield why it “[took] five years from 2003 to 2008 to get the work done ... Five years sounds an awfully long time.” Swaffield did not then refer to inadequate or tardy instructions, but answered obliquely:
A lot of it is – we’re talking about a business here ... We’re talking about information, too, that was going back to 1997, which is always a bit harder to collate ... In the original stuff, yes, the majority of it was there. It wasn’t until I think that letter you’ve got there [23 May 2007] that we extracted the rest of it ... to finish it off.
Whatever the final decision may have been, the prima facie evidence of the accountants’ masterly inactivity was clearly relevant to the client’s allegation of negligent non-performance, calling for a close, proactive investigation. In the electronic version of the decision (only) the Member observed: “I do not know that I would personally use the accounting services of the ... [sentence unfinished]”, but ultimately the references to the accountants’ glacial progress were bland:
The [accountants] after some delay prepared and forwarded income tax returns. The reason for the delay is not clear ... (written version)
[I]t took some time to provide those services and indeed the reason for that remains somewhat obscure. It may be the case – and I suspect that it is the case – that the [accountants could have been more proactive in pursuing the preparation of the documents, but it appears also that more information was perhaps required from the [client]. (electronic version)
No doubt, as the accountants must have known, the longer the client’s overdue returns were delayed, the more onerous the Tax Office’s interest charges and penalties were likely to be.
The accountants' invoice of July 2008 includes a charge of $1,300 for preparation and lodgement of the client’s 1997 tax return. But in 1997 the client’s tax affairs had not yet fallen into disarray. She provided the Tribunal with a letter from her previous accountant, Andrew Tickner of Rockhampton, dated 19 May 1998, confirming that he lodged her returns for 1995-1997. The client also provided a copy notice of assessment by the Deputy Commissioner of Taxation, finalising her tax liabilities for 1997. That evidence was not challenged by S & S Accounting Services, but is simply not mentioned in either the electronic or written versions of the decision. Charges for lodging returns were not disallowed, although the accountants’ representative clearly stated that they were sent out in July 2008, but not lodged.
The client gave evidence of part-payments under duress: “[D]ebt collectors ... they were pretty vicious and they hounded me ... and I was suffering depression”. That claim was not tested by her opponent or the Tribunal. It would, of course, entail a heavy onus of proof, and may well have been rejected. However, it is not considered in either version of the decision under appeal. It was not to be simply ignored.
I conclude that relevant evidence has been ignored: see [17], [22] and [23]. That is an error of law.[13] Moreover, the Tribunal has failed to conduct proceedings involving a legally unsophisticated defendant in the investigative manner required by the QCAT Act: see [9] and [10], above. It follows that leave to appeal should be granted, and the matter remitted for hearing before another adjudicator.
[13] Craig v South Australia (1995) 184 CLR 163.
ORDERS
Leave to appeal granted.
Orders made on 13 March 2012 set aside.
This matter is remitted for rehearing before a different Member or Adjudicator.
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