SMA Projects v Jovanovic [2006] VSC 176
In the Supreme Court of Victoria, Mandie J allowed an appeal, by leave, on questions of law under section 148 of the Victorian Civil and Administrative Tribunal Act 1998 from VCAT orders in two small claims under Part 9 of the Fair Trading Act 1999, holding that VCAT's oral reasons, given where no written reasons were requested, were inadequate and that this constituted or showed an error of law [1], [8], [38], [41], [42], [43].
What the court decided
Mr Jovanovic, who ran a cleaning business, claimed $4,610 from SMA Projects for what his application described as subsequent cleaning [3]. SMA Projects counterclaimed $8,530.50, alleging inadequate work and the cost of another contractor [4]. VCAT upheld the claim and dismissed the counterclaim [3], [4]. The Tribunal gave oral reasons and no party requested written reasons [8]. Mr Jovanovic was unrepresented on the appeal and was not really able to deal with the grounds [30].
Mandie J noted that section 117(5) of the VCAT Act requires written reasons to include findings on material questions of fact, but that there are no express requirements as to the contents of oral reasons [8]. In a small claim a party must request written reasons before or at the time the decision is given or notified [8]. His Honour said that oral reasons must still enable the appeal court to follow, even if in short compass, the conclusions on which the orders rest [8].
Counsel for SMA Projects argued that the Tribunal had failed to make or expressly state findings on the required standard of cleaning, breach and loss [32]. His Honour held that a failure by VCAT to give adequate oral reasons, where written reasons have not been requested, constitutes an error of law [38]. That was because inadequate reasons are not "reasons" within section 117(1), and further or alternatively because their inadequacy of itself is an error of law or leads to the inference that the Tribunal has not exercised its powers according to law [38]. Giving the oral reasons all the latitude the nature and size of the dispute allows and taking into account the absence of legal representation, he found them inadequate [39].
The Tribunal had noted evidence that the cleaning was not up to scratch, but made no finding whether it accepted that important evidence [40]. It also failed to deal with the oral evidence of faults when Mr Jovanovic last left the site [40]. Even if not obliged to deal expressly with each specific factual issue, it should at least have made general findings whether the cleaning breached the contract and, in short compass, why [41]. Without such findings the reasons for rejecting the counterclaim could not be identified, and in his Honour's view justice was not seen to have been done [41].
His Honour found it unnecessary to deal with the other grounds of appeal [42]. He held that the reasons were also inadequate on Mr Jovanovic's claim, stating no conclusion on whether the final clean was, at least in part, work remedying first stage deficiencies or on the hourly rate issue [42]. The appeal was allowed, both orders were set aside and the proceedings were remitted to VCAT for re-hearing before another member [43]. Mr Jovanovic was ordered to pay the costs of the appeal but was to be granted an indemnity certificate [44].
Why it matters
Under the VCAT Act as applied here, oral reasons in a small claim must still reveal the basis of the result on each claim, and at least contain a general finding on the ultimate issue [8], [41]. A losing party may therefore seek leave to appeal on a question of law even without having requested written reasons. The point was decided by a single judge without argument from the respondent on the grounds [30], so readers should check the current text of the Act and later authority.
Numbers in square brackets are paragraph numbers of the judgment. This note summarises a decided case for education and is not legal advice. See how the notes are written.