Sven Johnsen v Hatzis

[2005] NSWSC 611

CITATION:	Sven Johnsen v Hatzis [2005] NSWSC 611
HEARING DATE(S):	15 June 2005
JUDGMENT DATE :	29 June 2005
JURISDICTION:	Common Law Divison - Administrative Law List
JUDGMENT OF:	Associate Justice Harrison
DECISION:	(1) The decision of the Tribunal Member dated 13 December 2001 is quashed; (2) The plaintiff should be granted a certificate under the Suitor's Fund Act 1951 (NSW) if he is entitled.

CATCHWORDS:

Section 48K Home Building Act 1989 (NSW) - jurisdiction

LEGISLATION CITED:

Consumer, Trader and Tenancy Tribunal Act 2001 (NSW)
Fair Trading Tribunal Act 1998 (NSW)
Home Building Act 1989 (NSW)
Home Building Regulations 1997 (NSW)
Suitor's Fund Act 1951 (NSW)

CASES CITED:

Craig v South Australia (1995) 184 CLR 163
Jonsson v Arkway Pty Ltd & Anor [2003] NSWSC 815

PARTIES:

Sven Johnsen t/as Sven Johnsen Design & Build
(Plaintiff)

Marianne Hatzis
(Defendant)

FILE NUMBER(S):

SC 30033/2005

COUNSEL:

Mr T O Bland
(Plaintiff)

SOLICITORS:

Mr B Gillard
(First Defendant)

Mr S Tutton
(Second Defendant)

LOWER COURT JURISDICTION:	Consumer Trader and Tenancy Tribunal of NSW
LOWER COURT FILE NUMBER(S):	BU2000/109
LOWER COURT JUDICIAL OFFICER :	Member Durie

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION
ADMINISTRATIVE LAW DIVISION

ASSOCIATE JUSTICE HARRISON

WEDNESDAY, 29 JUNE 2005

30033/2005 - SVEN JOHNSEN t/as SVEN JOHNSEN DESIGN & BUILD v MARIANNE HATZIS & ANOR

JUDGMENT (Section 48K Home Building Act 1989 (NSW) - jurisdiction)

1 HER HONOUR: By summons filed 8 April 2005 the plaintiff seeks an order that the decision and orders of Member Durie of the Fair Trading Tribunal made on 13 December, 2001 in proceedings No BU2000/109 be set aside; or alternatively a declaration that (a) The Tribunal by reason of section 48K Home Building Act NSW 1989 (NSW) (HBA) did not have jurisdiction to hear and determine the matter; (b) The Tribunal has no equitable jurisdiction to determine claims where the applicant purports to be the beneficiary of a constructive trust; (c) The Tribunal has no equitable jurisdiction to hear and determine claims where the applicant is not the owner or successor in title to the land subject of the building works; or alternatively, an order that the matter be remitted to the Consumer Trader & Tenancy Tribunal, for a hearing denovo. Secondly, an order that the Member erred in law.

2 On 13 December 2001 Tribunal Member Durie ordered that Sven Johnson pay the sum of $200,000 to Marianne Hatzis within 14 days. The cross claim (by Johnson) was dismissed. Thus these proceedings were heard and determined over three years ago.

Declaratory relief

3 Certiorari is a process by which a superior court, in the exercise of original jurisdiction, supervises the acts of an inferior court or other tribunal. It is not an appellate procedure enabling either a general review of the order or decision of the inferior court or tribunal or a substitution of the order or decision which the superior court thinks should have been made. Where the writ runs, it merely enables the quashing of the impugned order or decision upon one or more of a number of distinct established grounds, most importantly, jurisdictional error, failure to observe some applicable requirement of procedural fairness, fraud and error of law on the face of the record.

4 Where the writ is sought on the ground of jurisdictional error, breach of procedural fairness or fraud, the superior court entertaining an application for certiorari can, subject to applicable procedural and evidentiary rules, take account of any relevant material placed before it. In contrast, where relief is sought on the ground of error of law on the face of the record, the superior court is restricted to the “record” of the inferior court or tribunal and the writ will enable the quashing of the impugned order or decision only on the ground that it is affected by some error of law which is disclosed by that record - see Craig v The State of South Australia (1995) 184 CLR 163 at 175-6.

5 Section 60 of the Fair Trading Tribunal Act 1998 (NSW) (FTT Act) provided that relief can be granted by way of a judgment or order in the nature of prohibition, mandamus, certiorari, and a declaratory judgment or an injunction if, in relation to the hearing or declaration of a matter where the Tribunal gave a ruling as to its jurisdiction, it was in error (s 60(2)) or a party had been denied procedural fairness. S61 FTT Act gives a right of appeal on a question of law.

6 The FTT Act has been repealed and replaced by the Consumer, Trader and Tenancy Tribunal Act 2001 (NSW) (CTTT Act). However, s 6 cl 6 of the CTTT Act makes provision for proceedings in the former Tribunal, which were instituted before 25 February 2002 to be continued and determined as if the CTTT Act had not be enacted. The legislation specifically includes any proceedings that are the subject of an appeal to the Supreme Court. The FTT Act applied to these proceedings. In any event, both Acts contain similar provisions.

7 The FTT Act provided that after deciding the question of the subject of an appeal, the court may affirm the decision of the Tribunal or it may make an order in relation to the proceedings in which the question arose as, in its opinion, should have been made by the Tribunal, or it may remit its decision on the question to the Tribunal and order a rehearing of the proceedings before the Tribunal (s 61).

Grounds of appeal

8 The plaintiff appeals from the decision and orders of Member Durie of the Fair Trading Tribunal made on 13 December 2001 on the following grounds: (a) The defendant had no standing to bring proceedings as she was not the owner or beneficial owner of the property subject of the contract; (b) The contract between the plaintiff and the defendant was void as the defendant had no authority to act on behalf of the lawful owner of the land; (c) The “Owner Builder Permit” issued in 1998 would in effect make the plaintiff a subcontractor to Third Party. This, via regulation 13 Home Building Regulation 1997 (s 140 HBA) would exempt the plaintiff from the requirements of “writing” in s 7 of the Act, therefore a claim in contract could and should have been allowed; (d) The plaintiff’s claim in quantum meruit was not barred by reason of s 10 HBA; (e) The Member allowed a claim in excess of the Jurisdictional limit of the tribunal, which is imposed by s 48K HBA to proceed on 8 October 2001; (f) The Member allowed an amended pleading to be filed on 12 December 2001 that sought an equitable relief that was beyond the jurisdiction of the tribunal; (g) The Member made findings contrary to the weight of evidence.

9 This hearing was unusual as both the defendant, Marianne Hatzis and the CTTT filed submitting appearances. Hence there was no contravenor. The hearing in the Fair Trading Tribunal took place over 3 years ago.

Jurisdiction

10 Section 21 of the FTT Act reads:

“General statement of jurisdiction

(1) The Tribunal has such jurisdiction to decide matters, and such powers to make orders and otherwise exercise any function in connection with any such decisions, as is conferred on it by any Act or law.

(2) Except as provided by any Act, the Tribunal has jurisdiction in respect of a matter arising whether before or after the commencement of any provision of this Act.”

11 The first issue is whether the Member had jurisdiction to hear the matter because the amended application sought payment of the sum of $509,000. This amount exceeds the jurisdiction in s 48K of the HBA (see t 2.12).

12 Section 48K(1) of the HBA reads:

“The Tribunal has jurisdiction to hear and determine any building claim brought before it in accordance with this Part in which the amount claimed does not exceed $500,000 (or any other higher or lower figure prescribed by the regulations).

13 There was no regulation in force prescribing a higher figure.

14 Hatzis did not abandon her claim for the excess. The FTT Act does not contain a provision whereby the parties can consent unlimited jurisdiction. It does contain a provision whereby the matter can be transferred to the District Court – see s 23. The parties proceeded on the basis that the Fair Trading Tribunal had jurisdiction. However, as the CTTT is a creature of statute, it is bound to act in accordance with the legislation.

15 The plaintiff correctly submitted that the savings or transitional provisions concerned with the 2001 amendment does not detail the procedure with regards to the amendment of s 48K HBA. It must be noted that there are a number of clauses with Schedule 4 that detail the transition provisions for the amendment of the HBA. It can be stated that if the legislature desired to restrict the operation of s 48K to proceedings commenced after its enactment, this would be reflected in the savings or transitional provisions in Schedule 4 HBA.

16 Shaw J in Jonsson v Arkway Pty Ltd and Anor [2003] NSWSC 815, (16 September 2003) stated:

“Jurisdiction, in any controversy before a statutory tribunal, is always an issue. In most cases this issue will not arise, or be easily dealt with: it will have jurisdiction or it will not. The tribunal may commit an error of law by exceeding that jurisdiction, or by failing to exercise it. A tribunal can make a determination as to its own jurisdiction however, any such determination is subject to review by a superior court” [13].

17 The High Court in Craig stated:

“…If such an administrative tribunal falls into an error of law which causes it to identify a wrong issued, to ask itself a wrong question, to ignore relevant material, to rely on irrelevant material or, at least in some circumstances, to make an erroneous finding or to reach a mistaken conclusion, and the tribunal’s exercise or purported exercise of power is thereby affected, it exceeds its authority or powers. Such an error of law is jurisdictional error which will invalidate any order or decision of the tribunal which reflects it.”

18 The Tribunal made a jurisdictional error which invalidates the decision of the Tribunal. Hence the orders made by the Tribunal should be quashed.

Equitable trust

19 The plaintiff submitted that the Tribunal did not have equitable jurisdiction and should not have proceeded to hear the matter. The Home Building contract was between M and A Hatzis as owners and Sven Johnson as contractor (see Exhibit A). The registered proprietor of the property was Mary Sourelos (t 115. 2).

20 In the Tribunal Member’s judgment dated 13 December 2001, he stated:

“The property at 104 Spencer Road, Mosman was owned by Ms Hatzis’s grandparents. Her grandfather passed away in 1988 and her grandmother in 1991. Probate of the grandmother’s will has now been taken out, the grandmother’s title deriving from her survivorship to the entirety upon the grandfather’s death.
Under the will the property passed to Kupenga Pty Limited, which is a company incorporated in 1977 to be the trustee of various properties within the Hatzis-Sourelos family. The clear intention of the grandparents and of Mr Sourelos and his wife was that as each of their three daughters married, they would commence to live in one of the properties held on trust by Kupenga in Mosman.
In 1997 when Ms Hatzis was marrying, she had a conversation with her mother, who is a director of Kupenga, to the effect that she, Ms Hatzis might like to move into the property at 104 Spencer Road for her own house and to renovate it at an expense then said to be Ms Hatzis. That, in fact, has occurred.
On those facts, counsel for the applicant submits that I should draw the conclusion that what was created was some sort of equitable life estate in Ms Hatzis and that she had the entitlement to a conveyance of the legal estate upon the death of her parents.
Although no formal documentation was entered into at the time, that is a conclusion which can comfortably be drawn from paragraph 4 of the statement of Marianne Hatzis and paragraphs 4, 5 and 6 of the statement of Harry Sourelos. There are some obvious errors in Mr Sourelos’s statement of 10 September, but they have largely been corrected in the statement he made on 7 December” (P2 L25-58; P3 L1-6).

21 None of the statements referred to in the passage of judgment above are in evidence on this appeal. There is no definition of “owner” contained in the HBA. It is my view that it was open to the Tribunal Member to decided that Marianne Hatzis was entitled to a conveyance of the legal estate upon the death of her parents and hence fell into the definition of “owner”.

22 In relation to grounds of appeal (c) and (d), these issues were not raised nor ventilated before the Tribunal Member. They cannot be raised now. Alternatively, it was submitted by the plaintiff that the Member had a duty to draw the parties attention to these issues I disagree. In relation to (f), the Member had a discretion to allow a pleading to be filed late in the proceedings. He exercised that discretion. There is no error of law. The findings allegedly made contrary to the weight of evidence were not identified. Grounds of appeal (c) to (f) inclusive fail.

23 However as the Tribunal Member acted in excess of jurisdiction the result is that the decision of the Tribunal Member dated 13 December 2001 is quashed.

24 Normally costs follow the event. However, as the defendant offered no opposition to the orders, save as to costs, it is my view that the plaintiff should be granted a certificate under the Suitor’s Fund Act 1951 (NSW) if he is entitled.

Orders

(1) The decision of the Tribunal Member dated 13 December 2001 is quashed.

(2) The plaintiff should be granted a certificate under the Suitor’s Fund Act 1951 (NSW) if he is entitled.
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