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Gatongi v Newton Electrical Pty Ltd[2024] QCATA 128

Gatongi v Newton Electrical Pty Ltd[2024] QCATA 128

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

CITATION:

Gatongi v Newton Electrical Pty Ltd [2024] QCATA 128

PARTIES:

MONICAH GATONGI

(applicant/appellant)

v

NEWTON ELECTRICAL PTY LTD

(respondent)

APPLICATION NO/S:

APL025-24

ORIGINATING APPLICATION NO/S:

MCD057/23

MATTER TYPE:

Appeals

DELIVERED ON:

6 December 2024

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Senior Member Aughterson

Member M Katter

ORDERS:

  1. Leave to appeal is granted. The appeal is upheld.
  2. The respondent must refund to the applicant the sum of $960 paid for the goods, within two weeks of the date of this order.
  3. The respondent must either collect the goods from the applicant at its own expense or refund to the applicant any reasonable sum paid by the applicant for the return of the goods to the respondent, within two weeks of the date of this order.
  4. The respondent must pay to the applicant the sum of $533.20 (the filing fees), within two weeks of the date of this order.

CATCHWORDS:

APPEAL AND NEW TRIAL – APPEAL – GENERAL PRINCIPLES – RIGHT OF APPEAL – WHEN APPEAL LIES – OTHER CASES – where claim that goods did not correspond with the description – where wrongly represented that goods not a display model – where Adjudicator held that did not correspond with description – where held that remedy could not be established under Australian Consumer Law – whether remedy available

Competition and Consumer Act 2010 (Cth), Sch 2, s 56, s 259, s 260, s 263

Fair Trading Act 1989 (Qld), s 15, s 16

Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 32, s 102, s 146

Queensland Civil and Administrative Tribunal Rules 2009 (Qld), r 83

Australian Knitting Mills Ltd v Grant (1933) 50 CLR 387

David Jones Ltd v Willis (1934) 52 CLR 110

Department of Child Safety, Youth and Women v PJC and the Public Guardian [2019] QCATA 109

Harrison & Anor v Meehan [2016] QCATA 197

Speedway Safety Products Pty Ltd v Hazell & Moore Industries Pty Ltd (1982) 1 NSWLR 255

APPEARANCES & REPRESENTATION:

The matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld)

REASONS FOR DECISION

  1. [1]
    This is an appeal from a decision of an Adjudicator dismissing the applicant’s application for a remedy in relation to what was said to be the supply of a dishwasher that did not correspond with the description in terms of the Australian Consumer Law (Queensland). An appeal from a decision in a proceeding for a minor civil dispute may be made only with leave of the Appeal Tribunal.[1] That issue is addressed below.
  2. [2]
    By s 16 of the Fair Trading Act 1989 (Qld) (‘the FTA’), the ‘Australian Consumer Law text’ applies as a law of Queensland and, in so applying, may be referred to as the ‘Australian Consumer Law (Queensland)’. Here referred to as the ACL. By s 15 of the FTA, the ACL includes Schedule 2 of the Competition and Consumer Act 2010 (Cth).  
  3. [3]
    Schedule 2 includes, at s 56, a guarantee relating to the supply of goods by description. Section 56 provides:
  1. (1)
    If:
  1. (a)
    a person supplies, in trade or commerce, goods by description to a consumer; and
  1. (b)
    the supply does not occur by way of sale by auction;
  1. there is a guarantee that the goods correspond with the description.
  1. (2)
    A supply of goods is not prevented from being a supply by description only because, having been exposed for sale or hire, they are selected by the consumer.
  1. (3)
    If goods are supplied by description as well as by reference to a sample or demonstration model, the guarantees in this section and in section 57 both apply.
  1. [4]
    In relation to potential action by a consumer against a supplier of goods for breach of a guarantee under the ACL, s 259 of the ACL provides:
  1. (1)
    A consumer may take action under this section if:
  1. (a)
    a person (the supplier) supplies, in trade or commerce, goods to the consumer; and
  1. (b)
    a guarantee that applies to the supply under Subdivision A of Division 1 of Part 3-2 (other than sections 58 and 59(1)) is not complied with.
  1. (2)
    If the failure to comply with the guarantee can be remedied and is not a major failure:
  1. (a)
    the consumer may require the supplier to remedy the failure within a reasonable time; or
  1. (b)
    if such a requirement is made of the supplier but the supplier refuses or fails to comply with the requirement, or fails to comply with the requirement within a reasonable time—the consumer may:
  1. (i)
    otherwise have the failure remedied and, by action against the supplier, recover all reasonable costs incurred by the consumer in having the failure so remedied; or
  1. (ii)
    subject to section 262, notify the supplier that the consumer rejects the goods and of the ground or grounds for the rejection.
  1. (3)
    If the failure to comply with the guarantee cannot be remedied or is a major failure, the consumer may:
  1. (a)
    subject to section 262, notify the supplier that the consumer rejects the goods and of the ground or grounds for the rejection; or
  1. (b)
    by action against the supplier, recover compensation for any reduction in the value of the goods below the price paid or payable by the consumer for the goods.
  1. (4)
    The consumer may, by action against the supplier, recover damages for any loss or damage suffered by the consumer because of the failure to comply with the guarantee if it was reasonably foreseeable that the consumer would suffer such loss or damage as a result of such a failure.
  1. (5)
    Subsection (4) does not apply if the failure to comply with the guarantee occurred only because of a cause independent of human control that occurred after the goods left the control of the supplier.
  1. (6)
    To avoid doubt, subsection (4) applies in addition to subsections (2) and (3).
  1. (7)
    The consumer may take action under this section whether or not the goods are in their original packaging.
  1. [5]
    As to what is a ‘major failure’ for the purposes of s 259(3) of the ACL, s 260 of the ACL, in part, provides:
  1. (1)
    A failure to comply with a guarantee referred to in section 259(1)(b) that applies to a supply of goods is a major failure if:
  1. (a)
    the goods would not have been acquired by a reasonable consumer fully acquainted with the nature and extent of the failure; or
  1. (b)
    the goods depart in one or more significant respects:
  1. (i)
    if they were supplied by description—from that description; or
  1. (ii)
    if they were supplied by reference to a sample or demonstration model—from that sample or demonstration model; or …
  1. [6]
    On 23 October 2023, the applicant filed an Application for minor civil dispute – minor debt. The claim related to the online purchase of a dishwasher from the respondent for $960. The following facts are undisputed and/or were accepted by the Adjudicator:
    1. The dishwasher in question was a run-out model and was advertised as such.
    2. The applicant’s order for the dishwasher was placed online.
    3. Before placing the order, the applicant was told over the phone by a sales person that the dishwasher was not a display item and that it was new and in a box. She purchased the item following that conversation.
    4. The dishwasher in question was unpacked and had been on display in the respondent’s store. It was delivered to the applicant in bubble wrapping. It was not in a box.
    5. After delivery, the applicant sent to the respondent a complaint by email stating that she had been given a display model, when she had been told that it would be new and in a box. The respondent acknowledged the sending of the email, but said that it had been sent to a no-reply invoicing system and was not received by the store. Subsequently, the respondent agreed to refund the amount paid but did not agree to pay any cost incurred in returning the product to them. It is evident that the freight cost for return of the goods at the time would have been $260.
  2. [7]
    The Adjudicator found that the goods did not correspond with the description in that ‘it was a display model rather than a run-out model and did not come in a box’. It was accepted by the Adjudicator that a display model is distinctive. While the respondent stated that the power of the dishwasher had not been turned on while on the shop floor, it remains that the item was on display and subject to wear and tear through unpacking or handling by potential customers. However, in finding that the applicant did not have a remedy under s 56 of the ACL, the Adjudicator made two findings.
  3. [8]
    First, that s 259 of the ACL requires a ‘major failure’ in order for there to be a remedy and there was no such failure in the present case. It was held that the fact that it was a display model and delivered in bubble wrapping did not constitute a departure in a ‘significant respect’ from the description in terms of s 260(1)(b)(i) of the ACL. Also, with reference to s 260(1)(a), it was not accepted that ‘the goods would not have been acquired by a reasonable consumer fully acquainted with the nature and extent of the failure’.
  4. [9]
    Second, with reference to s 259(4) of the ACL and general principles of contract law, it was held that the applicant must demonstrate that she had suffered a loss and she had not done so. Because of the bubble wrapping and her concern that it was a display model, the applicant had not removed the wrapping. Accordingly, the Adjudicator found that there was no evidence as to its appearance or whether or not it was damaged or able to function properly.
  5. [10]
    As noted above, leave is required to appeal from a decision in a proceeding for a minor civil dispute. The Appeal Tribunal in Harrison & Anor v Meehan set out the criteria for determining whether leave should be granted:[2]

The relevant principles to be applied in determining whether to grant leave to appeal are well established: Is there a reasonably arguable case of error in the primary decision; Is there a reasonable prospect that the applicant will obtain substantive relief; Is leave necessary to correct a substantial injustice to the applicant caused by some error; Is there a question of general importance upon which further argument, and a decision of the appellate court or tribunal, would be to the public advantage.

  1. [11]
    Leave should be given in the present case. In our view the Adjudicator has fallen into error in misconstruing the legislation, which is an error of law, and it is necessary to correct a substantial injustice to the applicant, notwithstanding the relatively minor sum in dispute between the parties.
  2. [12]
    The ACL does not define the term ‘supply (of goods) by description’, other than indicating at s 56(3) of the ACL that it can include a supply of goods where they are selected by the consumer. However, the term has long been used in consumer protection legislation throughout Australia.
  3. [13]
    In the context of an equivalent provision under the Sales of Goods Act 1895 (SA), in Australian Knitting Mills Ltd v Grant,[3] Dixon J stated:

When identified goods are sold, it is obvious that they remain the subject of the sale whether they do, or do not, correspond with the description which the parties have given them. But, however certainly the identity of the goods may be established, the parties must, since the intention is expressed or communicated, refer in some way to the goods. They must use some ‘description’ to refer to them. A difficulty, therefore, cannot but arise in determining when the sale is ‘by’ the description and when not. Apparently the distinction is between sales of things sought or chosen by the buyer because of their description and of things of which the physical identity is all important. When the ground upon which the goods are selected or identified is their correspondence to a description and when, therefore, it may be said that the buyer primarily relies upon their classification or possession of attributes, then, notwithstanding that they are bought as specific goods ascertained and identified, the goods are bought by description.

  1. [14]
    In David Jones Ltd v Willis,[4] with reference to an equivalent provision in the Sale of Goods Act 1923 (NSW), Rich J stated:[5]

The difficulty is to discover in a particular case how far the description of the goods enters into the bargain and how far on the other hand the actual identity of the goods is the governing element in the sale. In very many cases in which goods are bought over the counter the description or classification of the goods is the first essential of the transaction, but from the buyer's point of view the selection of a particular example of those goods and the purchase by him of the identical goods so selected is another essential of no less weight and importance. I think the result of the authorities which are collected, not only in Grant's Case, but also in the judgment appealed from now is that, whenever the description of the goods enters into the transaction, so that the buyer must be taken to rely upon it to a substantial degree as well as upon the identity of the goods, it is a sale by description.

  1. [15]
    In the present case, it was accepted by the Adjudicator that the given description of the washing machine as not being a display model and that it was boxed (suggesting that it had not been unpacked following delivery from the manufacturer) formed part of the description and, in placing the order, that description was relied upon by the applicant to a substantial degree. As noted above, the Adjudicator found that the goods did not correspond with the description. That finding was open on the evidence.
  2. [16]
    The question, then, is whether a remedy is available in the circumstances of the present case.
  3. [17]
    Section 259 of the ACL distinguishes between a failure to comply with a guarantee that can be remedied and is not a major failure, at s 259(2), and a failure to comply that cannot be remedied or is a major failure, at s 259(3). That distinction dictates the available remedy.
  4. [18]
    Where the failure can be remedied and is not a major failure, and a consumer requires the supplier to remedy the failure, by s 261 of the ACL the supplier has the option, relevant to the circumstances of the present case, to either replace the goods with goods ‘of an identical type’[6] or refund any money paid by the consumer and ‘an amount that is equal to the value of any other consideration provided by the consumer for the goods’.[7] Where there is inaction by the supplier, then, by s 259(2)(b), the consumer is able to recover all reasonable costs from the supplier in having the failure remedied or, subject to the limitations at s 262, reject the goods.
  5. [19]
    Where the failure to comply cannot be remedied or is a major failure, by s 259(3) of the ACL the consumer may, again subject to s 262, reject the goods, or recover compensation for any reduction in the value of the goods.
  6. [20]
    In addition, whether proceeding under s 259(2) or s 259(3) of the ACL, by s 259(4) the consumer can recover any reasonably foreseeable loss or damage arising from the failure to comply with the guarantee. Section 259(6) of the ACL makes it clear that the remedy at s 259(4) applies in addition to the remedies at s 259(2) and s 259(3).
  7. [21]
    As the dishwasher in the present case was a run-out model and the last one was taken by the applicant, in terms of s 259(2) and s 261 of the ACL it is evident that the failure cannot be remedied to the extent that it can be replaced with goods ‘of an identical type’.
  8. [22]
    On the other hand, s 259(3) applies where the failure to comply cannot be remedied, regardless of whether or not there has been a major failure to comply with the guarantee. Under that provision, the applicant was entitled to reject the goods and recover any loss arising pursuant to s 259(4) of the ACL.
  9. [23]
    The consequences of rejecting goods is dealt with at s 263 of the ACL. The consumer must return the goods to the supplier, unless they cannot be returned without significant cost to the consumer because of, among other things, the size of the goods. In those circumstances the supplier must collect the goods at the supplier’s expense.
  10. [24]
    In that context, the error of the Tribunal at first instance was twofold. First, in holding that loss or damage had to be established in order to succeed with an application made pursuant to s 56 of the ACL and, second, in holding that it was necessary to establish a ‘major failure’ to comply with the guarantee.
  11. [25]
    As noted, the establishment of loss or damage is not a component of either s 259(2) or 259(3) of the ACL. The potential for recovery of any loss or damage is separately provided for as an additional remedy: see s 259(4) and 259(6) of the ACL. Also, it is not an essential component of either s 259(2) or s 259(3) that there be a ‘major failure’ to comply with the guarantee. While s 259(2) deals with a failure to comply that is not a major failure, s 259(3) is expressed in the alternative. That sub-section applies where the failure to comply cannot be remedied or is a major failure.
  12. [26]
    It follows that in the circumstances of the present case, where the applicant has rejected the goods, the respondent should refund the cost of the dishwasher and either collect the goods at its expense or compensate the applicant for any reasonable costs incurred in returning the goods.
  13. [27]
    Leave to appeal is granted and the appeal is upheld. By s 146(b) of the QCAT Act, the Appeal Tribunal may set aside the decision and substitute its own decision. Given the nature of the dispute and the sum involved, that is the appropriate course in the present case.
  14. [28]
    It is ordered that the respondent refund to the applicant the sum of $960 paid for the goods and either collect the goods from the applicant at its own expense or refund to the applicant any reasonable sum paid by the applicant for the return of the goods to the respondent, within two weeks of the date of this order.
  15. [29]
    Further, the applicant paid a filing fee of $153.70 for the application for minor civil dispute. The applicant has, in effect, been successful in achieving the orders sought in the application for minor civil dispute. Rule 83 of the Queensland Civil and Administrative Tribunal Rules 2009 (Qld) provides that the Tribunal may award costs against a party only to order the party to pay to the applicant the amount of any prescribed fee paid by the applicant on filing the application for the proceeding.[8]
  16. [30]
    The applicant has also paid a filing fee of $379.50 for the application for leave to appeal or appeal. The application for leave to appeal or appeal is a separate proceeding from the application for a minor civil dispute and in considering costs in the appeal, the Appeal Tribunal is not constrained by the limitations set out in r 83. It is open to the Appeal Tribunal to award costs in the appeal proceeding having regard to the usual considerations set out at s 102(3) of the QCAT Act. The respondent is to pay to the applicant the sum of $533.20 (being the sum of both filing fees paid) within two weeks of the date of this order.

Footnotes

[1]Queensland Civil and Administrative Tribunal Act 2009 (Qld) s 142(3)(a)(i) (‘QCAT Act’).

[2][2016] QCATA 197, [8] (citations omitted) (‘Harrison & Anor v Meehan’); Department of Child Safety, Youth and Women v PJC and the Public Guardian [2019] QCATA 109, [14].

[3](1933) 50 CLR 387, 417.

[4](1934) 52 CLR 110.

[5]Ibid 118-9. See also Speedway Safety Products Pty Ltd v Hazell & Moore Industries Pty Ltd (1982) 1 NSWLR 255, 258, per Samuels JA. See also per Glass JA, 263.

[6]ACL s 261(c).

[7]ACL s 261(d)(ii).

[8]Queensland Civil and Administrative Tribunal Rules 2009 (Qld) r 83(b).

Close

Editorial Notes

  • Published Case Name:

    Gatongi v Newton Electrical Pty Ltd

  • Shortened Case Name:

    Gatongi v Newton Electrical Pty Ltd

  • MNC:

    [2024] QCATA 128

  • Court:

    QCATA

  • Judge(s):

    Senior Member Aughterson, Member M Katter

  • Date:

    06 Dec 2024

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

Cases Cited

Case NameFull CitationFrequency
Australian Knitting Mills Ltd v Grant (1933) 50 CLR 387
2 citations
Jump To
Cite 1 - (1933) 50 CLR 387
Cite 2 - (1933) 50 CLR 387
David Jones Limited v Willis (1934) 52 CLR 110
2 citations
Jump To
Cite 1 - (1934) 52 CLR 110
Cite 2 - (1934) 52 CLR 110
Department of Child Safety, Youth and Women v PJC [2019] QCATA 109
2 citations
Jump To
Cite 1 - [2019] QCATA 109
Cite 2 - [2019] QCATA 109
Harrison and Anor v Meehan [2016] QCATA 197
2 citations
Jump To
Cite 1 - [2016] QCATA 197
Cite 2 - [2016] QCATA 197
Speedway Safety Products Pty Ltd v Hazell & Moore Industries Pty Ltd [1982] 1 NSWLR 255
2 citations
Jump To
Cite 1 - [1982] 1 NSWLR 255
Cite 2 - [1982] 1 NSWLR 255

Cases Citing

No judgments on Queensland Judgments cite this judgment.

1

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