Jayanti v Kondireddy[2022] QCATA 93

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

REASONS FOR DECISION

Background

1. [1]
   On 16 July 2021, Maheshwar Reddy Kondireddy (for convenience I will refer to this party simply as ‘Kondireddy’) and Madhuri Sareddy (not a party to this appeal) filed an ‘Application for minor civil dispute – dividing fences – Neighbourhood Disputes (Dividing Fences and Trees) Act 2011 and Building Act 1975’. Kondireddy sought an order for the contribution of $1260 towards the cost of a dividing fence from the owner of his neighbouring property, Vamsi Mohan Jayanti (for convenience I will refer to this party simply as ‘Jayanti’).
2. [2]
   On 23 July 2021, the tribunal sent a notice of hearing to Jayanti informing him that the matter was listed for hearing at Ipswich at 3pm on Wednesday 29 September 2021.  The notice identified the parties and the claim number and stated: “If you do not attend the hearing, the tribunal may hear and decide the matter in your absence, including making orders against you.”
3. [3]
   The matter was heard at Ipswich on 29 July 2021. Kondireddy (and Sareddy) appeared.  Jayanti did not appear. The only evidence before the hearing member appears to have been provided by Kondireddy (and Sareddy). A decision was made, and reasons given ex tempore.
4. [4]
   A copy of the decision was sent to Jayanti by post on 29 September 2021, and by email on 30 September 2021. On 7 October 2021 Jayanti filed an application for leave to appeal or appeal and an application to stay the decision. 
5. [5]
   The Appeal Tribunal made directions in relation to both the appeal and the stay applications.
6. [6]
   On 17 December 2021 the stay application was refused.
7. [7]
   I am to determine the application for leave to appeal and appeal.

The decision

8. [8]
   The hearing member found:

“The difficulty with this claim being brought as a dividing fences claim is that a quotation was not included with the notice to contribute as required by section 31 of the Neighbourhood Disputes (Dividing Fences and Trees) Act 2011 and neither was the claim submitted within two weeks of the notice to contribute being issued, which was issued in January 2020.”^[1]

9. [9]
   The member concluded that in a phone call in January 2020:

“… a contract came into existence, the terms of which were that Mr Kondireddy and Ms Sareddy were going to build a fence, that the respondent would contribute approximately 12 - $1300 for that fence once the fence was completed. The fence, having been completed, I consider that he is now in breach of the contract, breach of his obligation under the contract to pay a rough figure of 12 - $1300 and I consider that the law will imply that the amount of 12,000 – sorry, $1260 was a part of the contractual obligation construed broadly.”^[2]

10. [10]
    It was ordered that:

    1. (a)
       The requirement for the Applicants to file a Form 3 Application for Minor Civil Dispute Minor Debt and for personal service is waived.
    2. (b)
       The Respondent is to pay within 7 days from the date of this Order to the Applicants the amount of $1260.00 by electronic funds transfer to Westpac BSB 734 221 Account No 844533 Account Name Maheswar Reddy.

The Appeal

11. [11]
    In the ‘list of reasons’ for the stay application (Form 44) and the application for leave to appeal or appeal (Form 39) ‘grounds of appeal’, Jayanti said that Kondireddy: failed to follow “correct legal procedures” by not informing Jayanti in writing that “he is planning to construct the fence”; failed to “send two quotes before the fence is being built”; failed “to take our consent before constructing the fence”; and “send a notice of contribution 7 months after we have sold the property”. 
12. [12]
    These reasons are broadly consistent with the findings of the hearing member concerning procedural failure in relation to the application as filed.
13. [13]
    Although Jayanti had been served with a copy of the hearing member’s decision, it would appear that at the time the stay application and the application for leave to appeal or appeal was filed, he was unaware that the matter had been determined as a debt dispute rather than as a dividing fences matter.^[3]

Dividing Fences matters

14. [14]
    Dividing fences disputes are minor civil disputes which can be advanced as a ‘dividing fences matter’ or as a ‘debt dispute’. 
15. [15]
    A dividing fences matter commences with the filing of an Application Form 53. In the instructions for completing Form 53 it says:

Lodging your application form

Before you lodge your application with QCAT you must make two (2) photocopies of the application and all attached supporting documents and lodge these together with your original application. An extra copy is required for each additional respondent. If you file your documents in person or by post, you must include a stamped self-addressed A4 envelope.

Giving copies to the respondent

You have 7 days from the day you lodge your application to give (serve) a copy of the application to each of the respondent/s. You can check the lodgement date by looking at the date stamp on your application form.

…

You can serve the application personally, by post or use the services of a Magistrates Court bailiff, commercial agent or process server. Visit the QCAT website for information on serving application and documents.

Once the respondent has been served, you must complete Form 9 Affidavit of service. An affidavit is a statement sworn under oath/affirmation in the presence of a commissioner of declarations, justice of the peace or a lawyer. The affidavit is required to prove the application has been given to the respondent.

16. [16]
    To proceed as a ‘debt dispute’ the fencing dispute must concern a fixed or agreed sum of money which arises out of a contract for the supply of goods and/or services. A minor debt dispute is commenced by lodging a Form 3. A fixed or agreed sum includes the cost or work done under a written or verbal contract.  In the instructions for completing Form 3 it says:

Lodging your application form

Before you lodge your application with QCAT you must make two (2) photocopies of the application and all attached supporting documents and lodge these together with your original application. An extra copy is required for each additional respondent. If you file your documents in person or by post, you must include a stamped self-addressed A4 envelope.

Giving copies to the respondent

You must give (serve) a copy of the application to the respondent/s no later than 90 days after you lodge the application. You can check the lodgement date by looking at the date stamp on your application form.

If you cannot serve the application on the respondent you must complete a Form 42 – Application to extend or shorten time limit or wavier of compliance with procedural requirement.

You can serve the application personally, or by using the services of a Magistrates Court bailiff, commercial agent or process server. Visit the QCAT website for information on serving applications and documents.

Once the respondent has been served, you must complete Form 9 Affidavit of service. An affidavit is a statement sworn under oath/affirmation in the presence of a commissioner of declarations, justice of the peace or a lawyer. The affidavit is required to prove the application has been given to the respondent.

The respondent has 28 days from the date they were served to file a response to your application. To do so they need to complete and lodge Form 7 — Response to minor civil dispute — minor debt.

What if the respondent doesn’t respond?

If the respondent doesn’t respond to your application within 28 days, you may be able to apply to QCAT for a ‘default decision’ to end the matter.

The way the matter proceeded

17. [17]
    The proceeding was commenced as a dividing fences matter (Form 53). The application was not served on Jayanti. At the hearing the matter was decided as a debt dispute, the Member having waived the requirement for Kondireddy to file and serve a Form 3 application.^[4] 
18. [18]
    It would appear that when a matter is commenced as a ‘dividing fences matter’, although the respondent is required to be served with a copy of the application (Form 54), there is no opportunity for the respondent to file a response.  However, in a ‘debt dispute’ the respondent is afforded the opportunity to file a response. 
19. [19]
    In a ‘dividing fences matter’ there are a number of procedural steps which precede the filing of an application which must be undertaken by the applicant.  In particular, notice must be given to the respondent about the fencing work accompanied by a written quotation, and if within 2 months the adjoining owners have not agreed, the applicant may apply to QCAT for an order under s 35 of the Neighbourhood Disputes (Dividing Fences and Trees) Act 2011 (Qld) (‘NDA’).^[5] 
20. [20]
    In the application form Kondireddy indicated affirmatively that a notice to contribute had been given to Jayanti in accordance with s 31 of the NDA. It had not. On the application form, he also indicated affirmatively that there was a written agreement between Kondireddy and Jayanti regarding the dividing fence. There was not. This came out during the hearing.^[6]
21. [21]
    These procedural steps are intended to place the respondent in a position to be aware of the case they confront.
22. [22]
    In a ‘debt dispute’ there are no equivalent preceding procedural steps, but importantly in a debt dispute a respondent is afforded the opportunity to file a response – to present their version of events.
23. [23]
    The member pursuant to s 61 waived the requirement for Kondireddy to file a Form 3 Application for Minor Civil Dispute Minor Debt and for personal service.^[7]
24. [24]
    Section 61 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (‘QCAT Act’) relevantly provides:

61 Relief from procedural requirements

1. The tribunal may, by order—

…

3. waive compliance with another procedural requirement under this Act, an enabling Act or the rules.

…

3. The tribunal can not … waive compliance with another procedural requirement if to do so would cause prejudice or detriment, not able to be remedied by an appropriate order for costs or damages, to a party or potential party to a proceeding.

4. The tribunal may act under subsection (1) on the application of a party or potential party to the proceeding or on its own initiative.

5. The tribunal’s power to act under subsection (1) is exercisable only by—

1. the tribunal as constituted for the proceeding; or

1. a legally qualified member, an adjudicator or the principal registrar. 

25. [25]
    In this case and acting on the member’s own initiative, by waiving the requirement for the Kondireddy to file a Form 3 Application for Minor Civil Dispute Minor Debt and for personal service, the member determined that to do so would not cause Jayanti prejudice or detriment, which was not able to be remedied by an appropriate order for costs or damages.
26. [26]
    For the reasons that follow, I am not satisfied that this conclusion is reasonable.

QCAT’s way of operating

27. [27]
    The manner in which QCAT is to conduct its business is regulated by s 28 of the QCAT Act. In all proceedings the tribunal must act fairly and according to the substantial merits of the case. In conducting a proceeding, the tribunal must observe the rules of natural justice. 
28. [28]
    In Chandra v Queensland Building and Construction Commission, Peter Lyons J (with whom Margaret McMurdo P and North J agreed) said:

“Section 29(1)(a)(ii), consistently, requires the tribunal to take all reasonable steps to ensure each party to a proceeding understands the nature of assertions made in the proceedings and the legal implications of the assertions. This provision also requires the tribunal to take all reasonable steps to "understand the actions, expressed views and assertions" of a party to a proceeding before it, with specific reference to the party's age, any disability, and cultural, religious and socioeconomic background. Section 95(1) requires the tribunal to allow a party to a proceeding reasonable opportunity to do a number of things, including calling or giving evidence, and making submissions. These things are consistent with the objects of the Act, which include to have the tribunal deal with matters in a way that is fair.” ^[8]

Decision

29. [29]
    Under s 142(3) of the QCAT Act, an appeal on a question of fact, or a question of mixed law and fact, may be made only if the party has obtained the appeal tribunal’s leave to appeal. While Jayanti’s application for leave and appeal does not engage with the basis upon which the member determined the matter, it did not do so because that basis was, at the time, not known to him.  The matters raised in Jayanti’s application take issue with aspects of the evidence of Kondireddy. The member, in the absence of material from Jayanti, came to a similar view and concluded that the application as framed could not succeed.
30. [30]
    As noted, Jayanti did not appear at the hearing, and sometime later advised that his non-attendance was the result of a family emergency. Jayanti had not been served with the application. He was served with a notice to appear. The notice to appear identified the parties, the file number and the time and place of the hearing. It did not identify the nature or purpose of the hearing and the application that gave rise to it. Despite this, the risk of non-attendance had been spelt out in the Notice of Hearing: “If you do not attend the hearing, the Tribunal may hear and decide the matter in your absence, including making orders against you.” 
31. [31]
    Jayanti’s failure to appear should not, for that reason alone, disentitle him to natural justice.
32. [32]
    When it became apparent to the hearing member that the application as framed could not succeed, but that there might be another basis upon which the dispute could be prosecuted, consideration needed to be given to whether the matter could be fairly dealt with in the absence of Jayanti. 
33. [33]
    Relevant to the consideration of whether the matter could fairly proceed at that point is the fact that Jayanti would have been entitled to file a response had the claim been commenced as a ‘debt dispute’.
34. [34]
    Relevant also to that consideration were aspects of the evidence which are somewhat contradictory or opaque. The documentary evidence, including screenshots of text messages, is in many cases subjective and/or equivocal.  The account of conversations (said to establish an oral contract) drawn from the hearing transcript and the limited written material is in my view inconclusive.  The timing of events (relevant to the terms of an oral contract) as disclosed in the material before the appeal tribunal is similarly unclear. 
35. [35]
    In any matter before the tribunal, care must be taken to ensure that a party has a fair opportunity to deal with matters which may be potentially of importance in coming to a decision adverse to it. That is the consequence of s 28(2) and s 28(3)(a) and is consistent with s 29(1)(a)(ii) of the QCAT Act.^[9]
36. [36]
    In the circumstances it was dangerous to draw conclusions without affording the other party the opportunity to respond. That opportunity would have been afforded had the matter been brought as a ‘debt dispute’, or, if the hearing was adjourned to enable Jayanti to be served and to file a response.
37. [37]
    For these reasons the tribunal made errors of law in proceeding to hear and determine the matter on an alternative basis to that claimed which on the facts of this matter resulted in a denial of procedural fairness. Accordingly, leave to appeal should be granted, the appeal allowed, and the orders made 29 September 2021 set aside.^[10]
38. [38]
    As the hearing member correctly identified, the ‘dividing fences matter’ had no prospect of success and therefore the application should be dismissed.
39. [39]
    There may be a question as to whether a binding agreement was entered into between the parties. Should he wish to do so, Kondireddy may file a fresh application for a ‘debt dispute’ claim, serve the application on Jayanti, and if necessary, have the matter heard by the tribunal. 

Orders

1. Leave to appeal is granted.
2. Appeal allowed.
3. The application of the respondent Maheshwar Reddy Kondireddy filed 16 July 2021 is dismissed.
4. Orders 1 and 2 made 29 September 2021 are set aside.