Badcock v Carvin & Co. No. Scgrg-00-457

[2000] SASC 295

BADCOCK v CARVIN AND CO.
[2000] SASC 295

Magistrate’s Appeal

1................ MARTIN J......... (Ex tempore)     The respondent was the plaintiff in proceedings before a Magistrate in which the plaintiff claimed the sum of $7342 from the appellant (“the defendant”) for accounting work done by the plaintiff.  The Magistrate found in favour of the plaintiff.  The defendant appeals against the judgment and has alleged a number of errors by the learned trial Magistrate.

1. The plaintiff is a firm of accountants that formerly traded under the name of C.J. De Pizzol and Associates.  The plaintiff carried out accounting work for the defendant, the defendant’s former wife and entities associated with the defendant. In July, 1998 in excess of $2500 in fees was outstanding.  On 29 July, 1998, a principal of the plaintiff, Mr De Pizzol, and an employee of the plaintiff, Mr Mazzeo, met with the defendant.  The Magistrate found that Mr De Pizzol was eager to ensure that all past and future debts would be met by a responsible person.

2. Mr De Pizzol said he initially met with the defendant in the absence of Mr Mazzeo.  They had a general chat about past accounts and furniture. The defendant indicated he needed further work to be done.  Mr De Pizzol spoke of the amount outstanding to the practice and the defendant said he would “come good for” that amount.  At that stage Mr De Pizzol called Mr Mazzeo into the meeting.

3. According to Mr De Pizzol, the defendant indicated he wanted further work done and it was decided that the plaintiff would determine the cost of the work identified by the defendant.  He said it was agreed that the defendant would be responsible for fees incurred in future work. In addition, Mr De Pizzol said he indicated he would not do any further work unless the defendant “would guarantee the past debt and any future work that we would do”.  As to the response by the defendant, according to Mr De Pizzol:

   “Mr Badcock hesitated initially, but then said once I would give him a letter specifying the conditions and the amount that I would charge him for the future work, that he would sign and give a personal guarantee”.

4. Mr Mazzeo said the defendant asked if Mr De Pizzol could prepare accounts to be done and Mr De Pizzol responded that they could be done, but as the previous debt had not been paid a personal guarantee was needed from the defendant.  In response, the defendant said “yes, I’ll do it as long as I get this work done urgently.”

5. The defendant said in evidence that fees were discussed and there was talk of the amount of fees outstanding. However, it was his understanding that as far as Mr De Pizzol was concerned the payment of those fees was not an issue that would prevent further work being done by the plaintiff.  There was never any mention of a personal guarantee or a personal undertaking. According to the defendant, there were goods on order from him by Mr De Pizzol which would more than offset the value of the outstanding account.  He denied that there was any focus on outstanding fees or an arrangement to be put in place for future fees.  The defendant expressed the view that Mr De Pizzol and Mr Mazzeo were mistaken and that confusion existed as to what had occurred or been agreed at the meeting.

6. The Magistrate accepted the evidence of Mr De Pizzol and Mr Mazzeo.  He expressly disbelieved the defendant.  His Honour found as follows:

   “The defendant accepted and assumed personal responsibility for past and future indebtedness for the work that had been done and would be carried out by Carvin and Co., in respect of the entities that belonged to the family Badcock...”.

7. There was documentary evidence to support the case for the plaintiff.  Following the meeting, a letter was prepared and a draft forwarded to the defendant.  It was addressed to the defendant.  It contained a restatement of fees then outstanding and an estimate of further fees to be incurred.  The letter concluded as follows:

   “Please confirm acceptance of the above terms by signing this letter where stipulated below.

   Should you have any queries regarding any of the above matters, please do not hesitate to contact me.’

Above the line for the defendant’s signature were the words:

“I accept the terms as detailed in this letter”.

1. The meeting had occurred on 29 July 1998.  The letter is dated 31 July 1998 and was sent on that day by facsimile to the defendant.  A few days later the defendant attended at the office of the plaintiff.  He spoke with an employee of the plaintiff, Ms Kokaliaris.  She indicated that he was required to sign the letter, but he refused. Ms Kokaliaris said that initially the defendant observed that the letter was in the name of Carvin and Co. whereas part of the debt due was in the name of C.J. De Pizzol and Associates.  In order to allay the defendant’s concerns the defendant added a note to the letter in connection with a particular amount in the words “owed to C.J. De Pizzol and Assoc.”.  According to Ms Kokaliaris the defendant said he was coming to Mr De Pizzol in good faith, that he would pay the bill and that it was not necessary for him to sign the letter.  She explained that the letter had been drafted both for the defendant’s purposes in connection with the future work and in view of the problems the plaintiff had experienced in the past in obtaining monies from the defendant.  Asked if the defendant signed the letter, Ms Kokaliaris gave the following answer:

   “He did sign the letter under duress and whilst he - I said to him, look I have been instructed that this is what you sign. He signed the letter and he said that the letter wouldn’t hold up in court anyway, so he did not know why he was signing it”.

2. The defendant said in evidence that he regarded the letter of 31 July, 1998 as a fee estimate only.  He denied that in signing the letter he was giving a personal undertaking to pay the fees.  He maintained that he was wearing two hats at the time he signed the letter;  one in a personal capacity and one in a corporate capacity for a company of which he was the director, Austfurn Pty Ltd.  He was concerned about signing the letter because, if the corporate entity was committing to a liability for some of the outstanding fees, that liability should be clearly defined.  In signing he was not assuming personal responsibility for past fees.  He denied saying that the letter would not stand up in court.

3. The Magistrate found that the letter was a means of recording what had been discussed at the meeting.  He did not resolve the conflict between the evidence of Ms Kokaliaris and the defendant as to whether the defendant said the letter would not stand up in court.  In view of his very firm rejection of the evidence of the defendant as to matters agreed at the meeting, it appears likely that his Honour would have preferred the evidence of Ms Kokaliaris on this topic. However, for the purposes of this appeal it is not necessary to resolve that issue.

4. In addition to finding that the defendant accepted and assumed personal responsibility for past and future debts, the Magistrate was also satisfied that consideration existed.  He found the consideration to sustain the promise and make a binding contract was that the plaintiff would carry out the future work discussed at the meeting and mentioned in the letter.  That further work was subsequently carried out by the plaintiff and resulted in fees in excess of $4000.

5. The plaintiff was unrepresented at the trial and on this appeal.  He prepared the notice of appeal.  The grounds complain that the Magistrate erred in law in finding that a contract was concluded between the parties in July, 1998.  A number of particulars are provided which are directed to suggesting that the parties were not ad idem as to the terms of any agreement and that insufficient details had been specified with the result of whatever was agreed was too vague to amount to an enforceable contract.  In addition, the grounds and written submissions assert a number of deficiencies in the evidence and features of the evidence which the defendant argued confirmed the absence of any relevant agreement that he would undertake personal responsibility for past and future debts.  The defendant also dealt with numerous extracts from the evidence which he said demonstrated so many inconsistencies that the Magistrate should have rejected the evidence of the plaintiff’s witnesses on critical issues.

6. The circumstances in which it is appropriate for an appellate court to interfere with the findings of fact and credit made by a trial court are well established (see Devries v Australian National Railways Commission (1993) 177 CLR 472 at 479 and State Rail Authority of NSW v Earthline Constructions Pty Ltd (In Liq.) (1999) 73 ALJR 306.) Having considered the evidence and formed my own views, I am satisfied that there is no basis upon which this Court should interfere with the essential findings made by the Magistrate. He had the advantage of seeing and hearing the witnesses and there is nothing in the material before the Court to suggest that he misused that advantage. The letter of 31 July, 1998, although vague in certain respects, was capable of supporting the evidence of the plaintiff’s witnesses. Many of the criticisms levelled at the evidence by the defendant are merely examples of differing recollections to be expected from witnesses who are doing their best to recall accurately and truthfully events that occurred approximately 20 months prior to the giving of the evidence. None of the suggested differences in detail between the witnesses or criticisms levelled at the evidence by the plaintiff have caused me to doubt the correctness of the Magistrate’s decision.

7. The Magistrate expressed a degree of sympathy for the appellant. I can understand why he did so.  However, the Magistrate properly found that an agreement existed whereby the defendant agreed to pay to the plaintiff the amounts outstanding at the end of July 1998 and future fees incurred for work done by the plaintiff.  His Honour identified the amount of fees outstanding at the end of July 1998 and was satisfied as to the fees incurred after the agreement had been reached.  He properly found in favour of the plaintiff.  No basis has been demonstrated upon which this Court could properly interfere.  The appeal is dismissed.