Small claims: The Victorian Civil and Administrative Tribunal’s Civil Claims List
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For over 40 years, Victoria has had a small claims jurisdiction for the speedy, low-cost resolution of small claims. Initially this was under the Small Claims Act 1973 (Vic), then the Fair Trading Act 1999 (Vic) (‘FT Act’), and since 1 July 2012, under the ACL&FTA.
The ACL&FTA gives VCAT power to resolve a consumer and trader dispute, and it provides that the Australian Consumer Law (ACL) applies as a law of Victoria. The ACL now contains many of the ‘consumer protection’ provisions that were contained in the FT Act – such as the prohibitions on ‘misleading or deceptive’ and ‘unconscionable’ conduct – and it creates a series of ‘consumer guarantees’ about the quality of goods and services instead of expressing them as implied terms of a contract.
Because legislation does not operate retrospectively, the FT Act will continue to be relevant to transactions entered into up to 30 June 2012. There are several legislative changes over the years to very specific aspects of VCAT’s small claims jurisdiction, so for transactions prior to 2012 a consumer might need to seek specific advice about the applicable law.
CAV can advise anyone contemplating an application to VCAT. The Civil Claims application form and the publication, Making an Application in the Civil Claims List (both available online and from the Registry of the Civil Claims List) are comprehensive and helpful (see also ‘Making a claim to VCAT’, below).
The hearing is before a member of VCAT assigned to the Civil Claims List.
VCAT sits in central Melbourne and in various suburban and country locations throughout Victoria. (See ‘Contacts’, at the end of this chapter.)
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Disputes under the Australian Consumer Law and Fair Trading Act
Under the ACL&FTA, applications may be made to VCAT to hear and determine a consumer and trader dispute.
Anyone contemplating such an application should seek advice first. CAV and consumer advice services should be able to provide advice. See ‘Consumer Affairs Victoria’, below.
The following are important features of the jurisdiction under the ACL&FTA.
An application to hear and determine a consumer and trader dispute:
must involve a purchaser (or possible purchaser) and a supplier (or possible supplier) of goods or services, and either one may initiate the application;
may involve a dispute in negligence, nuisance or trespass that relates to the supply or possible supply of goods or services;
may be brought by a consumer against the trader without monetary limit;
may be brought by a trader against a trader;
must be brought within six years; and
may relate to a personal injury that relates to the supply or possible supply of goods or services if the claim is no more than $15 000.
Even though the word ‘consumer’ is in consumer and trader dispute, that expression does not only apply to ‘household purchases’. The definition refers to purchasers and suppliers, and so ‘business purchases’ are also covered (e.g. a newsagent could bring a claim in VCAT against a supplier of stationery, even though the newsagent bought the stationery to resell it).
A claim based on ‘negligence’ that does not relate to the supply (or possible supply) of goods or services – such as a motor vehicle collision – cannot be taken to VCAT. Similarly, a dispute between neighbours over their dividing fence, or a dispute between the partners in a partnership cannot be taken to VCAT.
Apart from the situation where a supplier sues a purchaser for less than $15 000, and the purchaser seeks to have the dispute heard in VCAT, there is no requirement in the ACL&FTA that an applicant pay any money demanded either to the respondent or into trust. However, a respondent may lodge an application by way of counter-claim against the applicant, and should quote the application number to ensure that both claims are listed together.
VCAT may make orders it considers fair and according to law, including:
for payment of money found to be owing by one party (including the applicant) to another party;
for damages, including exemplary damages;
for interest;
to declare a term of a contract void;
for the performance of a contract; and
varying a contract to avoid injustice.
VCAT may have regard to such matters as the intelligibility of the contract, the relative bargaining power of the parties, whether independent advice was obtained, and whether unfair tactics were used.
Disputes under the ACL&FTA fall into two categories: small claims (s 183), which involve a consumer and trader dispute not exceeding $15 000; and all other disputes under the ACL&FTA. Where the claim under the ACL&FTA is a small claim, then VCAT will not permit legal representation unless all parties agree or VCAT is satisfied that there is good reason and that no party will be disadvantaged. If the dispute is a small claim, then VCAT cannot order ‘costs’ to or against a party (except costs relating to a review), although if the applicant substantially succeeds in the case it can order the respondent to reimburse the filing fee and any hearing fees.
What can The Victorian Civil and Administrative Tribunal do?
VCAT has the power to make the following orders under the ACL&FTA:
order a party to pay money;
order a party to perform work to rectify a defect in goods or services;
order return of goods;
order payment of damages, including exemplary damages;
order payment by way of restitution;
vary a term of a contract or rescind a contract;
order a contract to be performed;
declare a term of a contract void and order a refund of money paid;
order interest;
declare that a debt is, or is not, owing; and
order a party to do or refrain from doing something.
VCAT has the power to include in an order a requirement that what is ordered to be done, be done within a specific time.
Where the parties to a dispute reach a settlement, VCAT may make orders necessary to give effect to the settlement (Victorian Civil and Administrative Tribunal Act 1998 (Vic) (‘VCAT Act’)). An applicant should always request that VCAT make this order. The terms of settlement may include a right to reinstate the claim if a promise to perform work is not complied with within an agreed time, or to be paid an agreed sum of money in those circumstances.
The power to declare that a debt is not owing is important. A person who is concerned that they will be sued in a court, and face incurring significant costs, can seek this declaration in VCAT. VCAT is less likely to award costs, and its simpler procedures usually make it less expensive than court proceedings.
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If you would like VCAT to deal with a dispute about buying or selling goods or services, fill in and submit VCAT’s ‘Application to the Civil Claims List’ form. This form can be downloaded from VCAT’s website at www.vcat.vic.gov.au (click ‘Forms, guides and resources’, then ‘Application forms’). Applications can be submitted online via VCAT’s website.
It is the duty of VCAT’s registrar and of every registrar of a Magistrates’ Court to give assistance in completing the application. Community legal centres, voluntary legal services and solicitors may also be of assistance in obtaining application forms and in filling them in.
VCAT has three levels of fee payers:
concession fee payers (who hold a current Health Care Card);
standard fee payers (individuals including traders, not-for-profit organisations and incorporated businesses with a turnover of less than $200 000 in the previous financial year); and
corporate fee payers (this includes government agencies).
Fees are highest for corporate fee payers.
The amount of the fee depends on the size of the claim. Currently, the minimum fee applies to claims of up to $3000. Concession fee payers pay no fee on claims up to $15 000.
If an application is made online, the fee is automatically calculated.
The prescribed fees are listed on the VCAT website: www.vcat.vic.gov.au/fees.
If paying the fee would cause financial hardship, the principal registrar has the power to waive the fee.
To lodge an application, an applicant may either visit VCAT and pay the fee over the counter, or complete and lodge an application form online with credit card details, or post the application with a money order, postal note, cheque or credit card details to: The registrar, Civil Claims List (see VCAT’s contact details in ‘Contacts’ at the end of this chapter). If the application is not complete or unclear or if the incorrect fee is paid, the registrar will write to the applicant but not process the claim until the further information is provided or fee paid.
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VCAT has specialist support services available to assist people applying to VCAT. This includes interpreters, disability, security, family violence and Koori support services. If you require or are seeking this assistance you can make this request to VCAT at any time. See VCAT’s website for more details about its support services: www.vcat.vic.gov.au/help-and-support/support-services-vcat.
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If a VCAT order is to be enforceable, the parties must be correctly named. It is the responsibility of the applicant to do this.
If the respondent runs a business, the correct name of the company or business, with the Australian Company Number (ACN) or Australian Business Name (ABN) must be supplied. Check with the contract, quote, invoice or receipt for the full name of the trader. A trading entity may be:
a company (with a name ending in ‘Pty Ltd’ or ‘Ltd’ and a nine-digit ACN);
individual(s) or company(ies) trading under a registered business name; or
an individual or partnership of individuals (e.g. husband and wife) trading under their own names.
Evidence of the trader(s)’ name(s) and address(es) in the form of the ACN or business name extract should be lodged with the application. A company search can be completed through the Australian Securities and Investment Commission (www.asic.gov.au; tel: 1300 300 630). Obtain a company search that shows the company’s ‘registered office’, because that is the address where the application form will be served.
If the respondent trades under a registered business name, a business name extract must also be supplied. If the trader is an individual, it is important that full and correct names are stated on the application. Abbreviations or incorrect spelling can result in an unenforceable order.
Under the ACL&FTA, a person can ask VCAT to order the Director of Consumer Affairs to provide the full name and address of a supplier who is unregistered or unlicensed (s 192).
It is important to state the trader’s correct address. Check to ensure that the address you have is still current and, if not, obtain the current address before lodging the application. Where you have problems obtaining the correct details of a trader, CAV may be able to help.
If a company has gone out of business or is unlikely to pay its debts, and you believe that the company contravened the ACL, you may wish to name as a respondent an individual who you believe was ‘involved’ in the contravention of the ACL. This is complex and it is wise to obtain advice before doing this, to ensure that you have an arguable claim.
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Goods may be purchased from a retailer (who made specific recommendations about them) and manufactured by another business (whose manufacturing may be defective). Before completing the application form, the applicant should carefully consider whether all persons and/or businesses who could be at fault have been named. For example, a defective tiling job could involve the builder, the tiler, the supplier of the tiles, the manufacturer or importer of the tiles, or the supplier or manufacturer of the adhesive.
Generally, VCAT is required to apportion liability between each ‘concurrent wrongdoer’. VCAT is required by the Wrongs and Limitation of Actions Acts (Insurance Reform) Act 2003 (Vic) (‘WLAAIR Act’) to find what proportion of the loss or damage claimed was each respondent’s responsibility. For example, if a house is painted by a tradesperson using paint found to be defective, VCAT may apportion 60 per cent responsibility against the painter and 40 per cent against the paint manufacturer.
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Sometimes the reason a person or business has not paid an account is because they are not satisfied with the goods or services supplied or believe they have been overcharged.
The consumer may lodge a civil claims application to claim compensation or to declare that they have been overcharged. The supplier of the goods or services would usually lodge an application for the price, identifying the application as a response or cross-application and providing a VCAT file number. Applications could be made the other way around, with the supplier getting in first to claim the price and the consumer then lodging the cross-application.
To avoid delay or an adjournment, cross-applications must be made as soon as possible after notice of the first application is received.
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The registrar will serve a copy of the application, as soon as practicable, on any person named as respondent. It is important for the applicant to name as respondents the people who have a sufficient interest in the resolution of the dispute to which the claim relates. VCAT will send a complete copy of the application and any attachments to each respondent. The registrar must also arrange a time and place for VCAT to hear the matter, taking into account the convenience and location of the parties, the place where the contract arose and the venues at which VCAT sits in its Civil Claims List. Notice of that time and place will be given to all parties.
VCAT is committed to using alternative dispute resolution. It is important to carefully read any notice to attend VCAT. If the amount of the dispute is between $500 and $10 000, the dispute may be suitable for ‘fast track mediation’. This means that a mediator from the Dispute Settlement Centre of Victoria will assist to resolve the dispute. The notice will advise the nature of the proceeding, whether it is a hearing, directions hearing, compulsory conference, or mediation (including fast track mediation). The consequences of non-attendance may be that an order is made in favour of the other party.
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It is important to prepare your case carefully and logically. Do not leave obtaining reports, quotations, witness statements, photos or the like to the last minute. Remember that what you complain about is likely to be contradicted by the other party; therefore, independent evidence may be crucial. Consider the possible reply that, for example, ‘the defect can be repaired, so the goods do not need to be replaced’, and ensure your evidence deals with this issue.
If VCAT accepts that replacement is the appropriate remedy, it may order that the goods be returned to the respondent. If you believe that this would entail risk of damage or expense, then ensure your claim includes the additional cost.
Two helpful documents that can be obtained from VCAT (in person or online) are ‘Preparing for a hearing in the Civil Claims List’ and ‘At the hearing of an application in the Civil Claims List’.
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It is still worthwhile seeing if the problem can be settled with the other party or parties after the claim has been lodged, as the respondent will have received the notice of claim and will now understand that the applicant is serious about pursuing this matter. The respondent may not want to go to VCAT and may be prepared to agree to requests. If the matter is fully settled, the claim can be withdrawn; if an uncleared cheque is received or a promise to do work is made, the claim should be adjourned or struck out with a right of reinstatement.
When contacting the other party to discuss the possibility of settling, it is best to do so in writing to avoid misunderstandings. If you state that the discussion is ‘without prejudice’, it will mean that if a settlement offer is not agreed, the offers made and rejected will be kept secret from VCAT so that the tribunal member is not influenced by them.
Hearings
Proceedings before VCAT are open to the public, but VCAT can order that a hearing, or part of it, be held in private (VCAT Act s 101).
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In small claims, a party to the proceedings usually presents their own case; it is rare for legal representation to be allowed in small claims. A company can be represented by one of its officers.
A lawyer will not be allowed to represent a party unless:
all the parties to the proceeding agree or VCAT so directs; and
VCAT is satisfied that the parties – other than the party who applied for the appearance of a lawyer – shall not be unfairly disadvantaged (VCAT Act sch 1 cl 4D(1)).
An applicant who needs someone to represent them should provide a written authorisation.
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Where the dispute is not a small claim, costs may be awarded at VCAT’s discretion (VCAT Act s 109). The provisions relating to a small claim provide that no order for costs can be made (sch 1 cl 4I) (except for applications under section 120 for a review of a case decided in a party’s absence).
Where an applicant succeeds in a claim, VCAT can order that the other party reimburse the applicant for the filing fee on the application and any other fees.
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If you are an applicant making a claim in VCAT, you should follow the procedures given below on the day of the hearing of your claim. Note that VCAT’s website contains guides called Preparing for a hearing in the Civil Claims List and At the hearing of an application in the Civil Claims List.
NOTE: Alternative dispute resolution processes – such as compulsory conferences and mediation – are available to assist in settlement of disputes (see VCAT Act ss 83–93, sch 1 cl 4H). For more advice, parties can contact the registrar of VCAT’s Civil Claims List.
As soon as you arrive, go to the office and let the reception desk or bench clerk know that you have arrived. Ask which room your matter will be heard in. If you wish, you can sit at the back of the room where your matter will be heard, to get an idea of what happens during similar hearings.
The matter will be heard by a member of VCAT, who should be addressed as ‘Sir’ or ‘Madam’. The member sits at the front of the room behind a desk. You will sit at a separate desk, with the respondent and any interested party at your left.
The first thing a member may do is offer the parties an opportunity to discuss settlement of the matter. Parties are encouraged to do so, but are not required or ordered to do so.
If the matter is settled, ask the member to make an order according to the terms of the settlement.
If the matter is not settled, the member will proceed to hear the case. You will be asked to present your side of the story. Written notes made before the hearing may assist you to do this. Take with you all the written documentation you have. Reports and quotations will often be important parts of the evidence. Take photos of the goods that have broken, or the wall that has cracked, if it will help the member understand what you are talking about.
Where needed to explain a claim, a video can be part of your evidence (contact VCAT beforehand to arrange for audiovisual equipment, or bring a laptop or the mobile phone on which the video was recorded). If you have any witnesses, make sure they come to the hearing with you.
It is best if you give your evidence before your witnesses. All oral evidence must be given truthfully. The official promise to tell the truth may be made by taking an oath or making an affirmation.
The member will ask questions of you and your witnesses. The respondent is also able to ask questions.
If your witnesses cannot attend on the day, they can make a statutory declaration before a qualified witness, stating what they know about the matter. You can then hand this to the member. Be aware that evidence given in person to VCAT, with the opportunity to be asked questions, is likely to be given more weight than a written statement. The member might decide that the hearing has to be adjourned so that the witness can attend in person.
After you have presented your side, the respondent gets the chance to respond to your claim. You will be given a chance to ask the respondent questions about the things they or their witnesses say.
Some issues ‘speak for themselves’ but some cases require expert evidence. An expert is a person who is qualified to give an opinion about a relevant issue. In a case about building work or building products, an expert might be a civil engineer, an architect or a building consultant.
‘Practice Note 2’, which can be found on the VCAT website, sets out the requirements for expert evidence. It is designed to stop unqualified people giving their uninformed opinions, and to make sure that the expert’s role is to assist VCAT to make a fair decision, rather than being a ‘gun for hire’. Usually, experts are required to put their opinion in a written report, and attend the hearing to explain their views.
Care in the preparation of the case should ensure that evidence is not repeated. VCAT may not permit additional evidence on a matter if it considers that the matter has already been fully covered (VCAT Act s 102(2)).
After both sides have put their case, the member will decide the matter in accordance with the relevant law and make an order.
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If a party does not appear at a hearing, VCAT will resolve the issue in dispute on the evidence produced. The VCAT order is lawful and as effectual as if the party had appeared and was fully heard.
If an issue in dispute is determined in the absence of a party, that party may make an application for review to VCAT within 14 days after the party receives notice of the order. An application for review must be made by way of statutory declaration stating the reason for non-attendance.
All parties are invited to the hearing of the review. The notice of hearing will state whether VCAT will only hear and determine the application for review at that time or whether it will hear and determine the original claim afresh if the review is granted. If the hearing is for review only and the review is granted, the claim will be reheard at a later date. A party is not entitled to seek more than one review without leave of VCAT (Victorian Civil and Administrative Tribunal Rules 2018 (Vic) (‘VCAT Rules’) r 6.10(1)). The party who applies for the review may have costs awarded against it, even in a small claim.
If it appears to the VCAT member that there was sufficient reason for the party’s absence, and there is some merit in that party’s arguments, an order may be made that the claim be re-heard (VCAT Act s 120).
Further information relating to re-hearings can be obtained from the Civil Claims List Registry and from VCAT Rules.
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A settlement or order made by VCAT is usually final and binding on all parties, and there is no appeal from the order other than on a question of law (VCAT Act s 148). For example, if VCAT acted outside its jurisdiction or denied a party natural justice, it would raise a question of law. Whether an order gives rise to an appellable question of law is a technical issue and it would be wise to seek legal advice promptly if you are considering an appeal. Appeals are made to the Supreme Court, which can award costs in relation to the appeal even if it arises from a small claim.
VCAT is required – if requested to do so by any person affected by a decision made or about to be made by it – to give that person a statement of the reasons for its decision.
If the claim is not a small claim, a party may request written reasons within 14 days (VCAT Act s 117(2)). However, if the claim is a small claim, written reasons must be requested before or at the time the decision is made.
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Orders for the payment of money
If VCAT makes an order requiring the payment of money by a party who was not present or represented at the hearing, VCAT must send a copy of that order to that party (VCAT Act s 116).
Where VCAT has made an order requiring money to be paid to a person and the money has not been paid, that person can enforce VCAT’s order in the Magistrates’ Court.
This is done by filing with the registrar of the Magistrates’ Court the following documents:
a certified copy of the order of VCAT; and
a sworn affidavit stating:
a. that the applicant is the person to whom payment is to be made under the order; and
b. the amount of money that has not been paid.
When filing these documents, the applicant must choose the Magistrates’ Court in the area where they live or the Magistrates’ Court in the area where the party required to pay the money lives or has a place of business. Once these documents have been filed, the court makes an order in the same terms as VCAT’s order, and the court’s order may be enforced accordingly. (See ‘Enforcement of court orders’ in Chapter 5.2: Are you in debt?)
If a trader against whom an order has been made is required to hold a licence (e.g. a motor car trader, or a travel agent), CAV may be approached for advice regarding enforcement.
Orders that do not require payment
Whether or not VCAT orders the payment of money, it can order that work be done to rectify defects in goods or services or order that goods be returned. This type of order (a non-monetary order) can be enforced by filing the following documents in the Supreme Court (VCAT Act s 122):
a certified copy of the order of VCAT;
a sworn affidavit as to non-compliance; and
a certificate from a judge or the principal registrar of VCAT that the order is appropriate for filing in the Supreme Court.
Another way to ensure that non-monetary orders are carried out is for VCAT to adjourn the proceedings to an administrative mention, or to strike out the case with a right of reinstatement. Either of these orders allows the party in whose favour the order operates to bring the case back if the order is not complied with.
Both advising VCAT of progress at an administrative mention, or applying to reinstate a proceeding that has been struck out, is done by writing to the registrar and sending a copy to the other party. The registrar then notifies the parties of any new hearing date.
At that hearing, VCAT decides whether the order has been complied with and, if not, can make any order that it has the power to make, including the payment of money.
Correcting orders
An order of VCAT can be amended if it contains:
a clerical mistake;
an error arising from any accidental slip or omission; or
a material miscalculation of figures, or any material mistake in the description of any person, thing, or matter referred to in the order.
The power to correct an order is limited. Correcting an order should not be confused with an appeal. VCAT has no general power to reconsider cases. If, for example, an applicant named the wrong person as respondent, and obtained an order against that person, the applicant could not have the order corrected. The applicant would have to begin a new proceeding against the proper respondent.
A party seeking a correcting amending order should obtain advice from the Civil Claims List Registry or refer to VCAT Rules.
Introduction
Chapter: 7.4: Taking action as a consumer
Contributor: Stephen Nowicki, Director of Legal Practice, Consumer Action Law Centre
Current as of: 1 September 2024
Law Handbook Page: 643
Next Section: Consumer Affairs Victoria
