Barlow v Lucas & Lucas - [2020] SADC 28

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil: Minor Civil Review)
BARLOW v LUCAS & LUCAS
[2020] SADC 28
Judgment of His Honour Judge Burnett
24 March 2020
MAGISTRATES - APPEAL AND REVIEW - SOUTH AUSTRALIA
The applicant/defendant sought a review of a judgment entered against him in a minor civil action in the Magistrates Court for the sum of $3,500.
The plaintiff claimed the cost of rectification of defective building work undertaken by the defendant.
The defendant on review contested only the quantum of the rectification work.
Held: Magistrate's decision affirmed subject to recalculation of the cost of materials. Application for review allowed to the extent of recalculating damages. Judgment for the plaintiff/respondent in the sum $2927.45.
Magistrates Court Act 2001 (SA) s 38(6), s 38(7), s 38(7)(d)(ii); Harradine v District Court of South Australia [2012] SASC 96; Gillott v District Court of South Australia [2019] SASC 132; Trittenheim Pty Ltd v H & H Gill Nominees Pty Ltd (1994) 63 SASC 434; Griggs v Noris Group of Companies (2006) 94 SASR 126, referred to.

WORDS AND PHRASES CONSIDERED/DEFINED
"Meaning of the phrase 'equity, good conscience and the substantial merits of the case without regard to technicalities and legal forms' discussed."

BARLOW v LUCAS & LUCAS
[2020] SADC 28
Introduction

This is a review pursuant to s 38(6) of the Magistrates Court Act 1991 of a minor civil action in which the Magistrate awarded judgment in favour of the plaintiffs, Robert Lucas and Kaye Lucas, against the defendant, Gary Barlow, in the sum of $3,500.
The applicant/defendant is dissatisfied with the judgment and has made application for a review of the matter.
The plaintiffs brought a claim for the sum of $8,870 in relation to building work undertaken by the defendant for the plaintiffs at the home of the plaintiffs at 11 Elm Street, Nairne. The building work consisted of renovations to the kitchen, namely the removal of existing bench tops, doors, breakfast bar shelf and supports of a housing unit, the disconnecting of appliances, the supply of a bench top and new cupboard doors, the making some alterations to the cooktop, unit under the cooktop and the reinstallation of appliances[1]. It was not a complete rebuild.
[1] Reasons of the Magistrate at [2].
The plaintiffs claimed that certain aspects of the work were not completed by the defendant to a tradesman-like standard for the contract price. The total contract price was $8,871.50, which had been paid by the plaintiffs. The plaintiffs claimed the whole of that sum.
The Magistrate rejected the claim of the plaintiffs that they were entitled to the whole of the contract price. Instead, the Magistrate found that certain of the works were not performed to a tradesman-like standard and awarded damages for the rectification of those works.
The defendant does not seek a review of the finding of the Magistrate that he did not complete the specified portion of the works to a tradesman-like standard. Instead, the defendant seeks a review of the quantum awarded for the rectification of those works. The review therefore requires an examination of the amounts awarded in relation to the specific items in question.
Application for review
On the review, the court may inform itself as it thinks fit and in doing so is not bound by the rules of evidence. The court may, if it thinks fit, rehear the evidence taken before the Magistrates Court. In determining the matter, the court may:
1Affirm the judgment; or
2Rescind the judgment and substitute a judgment that the court considers appropriate.
In hearing and determining the review the court must act according to equity, good conscience and the substantial merits of the case without regard to technicalities and legal forms.
It is important to note that the review is a review of the matter and not a review of the judgment.
Section 38(1) of the Act sets out the provisions which are applicable to the conduct of a minor civil action. The provisions provide as follows:
(a)the trial will take the form of an inquiry by the Court into the matters in dispute between the parties rather than an adversarial contest between the parties;
(b)the Court will itself elicit by inquiry from the parties and the witnesses, and by examination of evidentiary material produced to the Court, the issues in dispute and the facts necessary to decide those issues;
(c)      the Court may itself call and examine witnesses;
(d)     the parties are not bound by written pleadings;
(e)      the Court is not bound by the rules of evidence;
(f)the Court must act according to equity, good conscience and the substantial merits of the case without regard to technicalities and legal forms.
Sections 38(6) and (7) require an examination of the inquisitorial process undertaken by the Magistrate to determine whether there had been a trial by the Magistrate in accordance with those provisions. Conduct of a minor civil action must be considered in the context of the comments by Justice Blue in Harradine v District Court of South Australia[2] where Justice Blue explained that the role of the Magistrates Court in such an action is that of an inquiry by the Magistrate rather than that of managing an adversarial contest between the parties. His Honour went on to say that the clear policy of the Act was to provide an efficient and economical means by which small claims can be determined in the Magistrates Court. His Honour noted that Parliament had devised this system in consequence of the increasing costs of litigation. Accordingly, some of the protections provided by legal practice in the general jurisdiction may be sacrificed to the necessity of relating the cost to the amount of the claim in a minor civil action. This passage reflected the statement by the late Mr LJ King (then Attorney-General) in the second reading speech of the legislation in which small claims (as minor civil actions were then known) were introduced[3].
[2] [2012] SASC 96 at [40].
[3] South Australia, Parliamentary Debates, House of Assembly, 12 September 1974, 21-922.
In Gillott v District Court of South Australia[4], Justice Peek discussed the meaning of the phrase and “equity, good conscience and substantial merits of the case” and quoted from the decision of Olsson J in Trittenheim Pty Ltd v H & H Gill Nominees Pty Ltd[5] in which His Honour noted that the meaning of the phrase must derive from a consideration of the nature of the issues involved and where appropriate, the clear purpose of any applicable statute. Olsson J went on to hold that in certain cases the phrase required the Court to adopt a broad approach of common sense and common fairness, eschewing all legal or other technicality. In Griggs v Noris Group of Companies[6], Justice White referred to the phrase in the context of meaning the good sense and natural justice of the matter. At times, he held that the expression meant that the decisionmaker was empowered to do whatever it might think appropriate to achieve fairness between the parties.
[4] [2019] SASC 132 at [44]-[46].
[5] (1994) 63 SASC 434 at 442.
[6] (2006) 94 SASR 126, at 2.
Given the nature of minor civil actions and their purpose to achieve an economical and efficient disposition of the matter, I consider that the phrase “equity, good conscience and substantial merits of the case” is used in the context discussed above, namely a broad approach of common sense and common fairness, eschewing legal or other technicalities.
A decision of this Court on a Review is final and not subject to appeal, pursuant to s 38(8) of the Magistrates Court Act.
Conduct of the trial in the Magistrates Court
The Magistrate conducted the trial in an inquisitorial style as required by s 38(1)(a) of the Magistrates Court Act. The plaintiffs and the defendant all gave evidence before the Magistrate. The Magistrate was also assisted by a building expert, Mr Jankovic, as a court appointed expert. He provided a report that commented upon the defects of the building works. That report did not address the cost of the building works, although there was some evidence of the costs of certain of these items at trial. Mr Jankovic sat with the Magistrate during the trial and participated in the inquisitorial process adopted by the Magistrate.
There was also an expert report commissioned by the plaintiffs from Morton Constructions, although the author of that report, Mr Trevor Morton, did not give evidence. Again, the report from Morton Constructions did not identify the costs of rectifying certain individual items of the work, but rather only provided an opinion as to the cost of the whole work needing to be replaced.
The Magistrate adopted a broad-brush approach to the question of damages[7], which I consider was the correct approach to take. Calculating damages for a breach of contract necessarily involves a degree of hypothesis and pragmatism[8].
[7] Reasons at [18].
[8] N.C. Seddon and M.P. Ellinghaus “Cheshire and Fifoot’s “Law of Contract”, 9^th Australian Edition, 2008 at [23.24].
Time for the institution of the Review
The respondents complained that the defendant was out of time for instituting his application for review. The Magistrate gave judgment on 4 December 2019. Pursuant to District Court Rule 279A(2), an application for review must be made within 21 calendar days after the date of judgment. The review was in fact instituted on 30 December 2019, more than 21 days after the judgment. However, pursuant to Rule 5(6)(b) time does not run during the period of the Christmas vacation. Supplementary Rule 55(1) provides that the Christmas vacation comprises the calendar days between Christmas Day and New Years Day. In these circumstances, the application for review by the applicant was made within time.
In any event, if necessary, I would have extended the time for the bringing of the application for review. There was no prejudice to the plaintiffs in respect of the five-day delay in bringing the application. Further, the timing of the 21 days was in the Christmas period during which the defendant would have obvious difficulty in filing the application.
The Review
On review, the applicant/defendant contended in respect of those certain items that the time allowed by the Magistrate for the rectification works was excessive as was the cost of materials.
I will deal with each of the items in turn.
The Magistrate found, in accordance with the expert report of Mr Jankovic, that there were gaps observed between the doors that were installed overhead of the microwave and also gaps in the drawers[9]. There were also similar issues in relation to the new carcasses above the fridge which had not been joined properly and door handles that were not lined up correctly.
[9] Reasons at [8] and [19].
The Magistrate found that the rectification work necessary to fix those items would require alterations or adjustments of the hinges with the possibility that the replacement of a couple of doors might be needed. The Magistrate found that there might be a need to measure additional doors and then to return to the premises. In the circumstances, the Magistrate found that it would take two men eight hours each to complete the work and an allowance should be made for the cost of purchasing one or two doors in the sum of $100.
The applicant accepts the specified rate of $40 per hour but disagrees with the quantum of the number of hours, submitting that it would not be necessary to have two men working a total of 16 hours and that 12 hours would be sufficient. The applicant does not disagree with the $100 cost for materials.
Questions of quantum in a matter such as this inevitably are not capable of precise calculation and require an estimate based on the extent of the work.
In the circumstances given the relatively small amount of time in dispute, I do not consider that there are grounds for reviewing the Magistrate’s determination of this cost of rectification. I consider that the Magistrate has adopted a broad approach of common sense and common fairness to this issue, taking into account the extent of the work required. I agree with that approach.
I therefore would allow the total of 16 hours for this work at $40 per hour plus $100 for the cost of materials.
The second item in dispute relates to the pantry door[10]. The work required the reinstallation of a door, together with an element of measuring and the possibility of returning to the premises to fit the pantry door. The applicant did not contest the Magistrate’s determination that the work would take in the order of two to three hours to install and there would be a cost of materials of $400 for the replacement of the door.
[10] Reasons at [10] and [20].
The third item related to the kitchen benchtop and the covering of the gap that was between the panel and the walls[11]. The Magistrate allowed in the order of a few hours to undertake that rectification work and materials in the order of $200.
[11] Reasons at [14] and [21].
The applicant disagreed with the estimation of a few hours and also the cost of materials in the sum of $200. The applicant contended that nothing should be allowed for these items. There was significant evidence from Mr Lucas and Mr Barlow at trial as to the work that would be required to rectify this defect. Mr Jankovic also provided his opinion as to what work was needed to be undertaken. Mr Barlow did not disagree at trial with the nature of the work that had to be undertaken. In these circumstances, I find the Magistrate’s estimate in the order of a few hours to undertake the rectification work was fair and reasonable. Given this finding, I consider that there would be a cost for materials in the sum of $200. The evidence at trial suggested that some materials would be required if the work was undertaken and I do not consider that estimate unfair or unreasonable.
The next item disputed by the applicant is the 12 mm quad and silicone between the bench and wall and uprights[12]. The Magistrate found that rectification work would require two tradespeople to create a template and return to the workshop to create the proposed seal. This work, the Magistrate found, would take two people in the order of eight hours. The Magistrate assessed materials at around $300. The applicant disputed this item and said that it would take one tradesperson one to two hours and that the cost of materials would be in the sum of $19. The applicant tendered on this review a catalogue from Bunnings showing that the Masonite standard panel cost $19.
[12] Reasons at [22].
At trial, Mr Jankovic provided in some detail his opinion as to the work that was required and his opinion that it would take two people working there together to perform that work. In the circumstances, I consider that the Magistrate’s estimate of eight hours each is fair and reasonable and in accordance with the evidence. I do not find any reason to disturb that finding.
There was however no evidence as to the cost of materials in the sum of $300. I accept the evidence of the applicant on review that the cost would be $19 in accordance with the exhibit tendered by the defendant. I therefore will deduct the sum of $281 from the judgment sum.
The next item in dispute concerned the kick plates[13]. This was not a matter addressed by Mr Jankovic in his report. The complaint about the kick plates was that they were not sealed and joined properly. The applicant gave evidence at trial that the work done for rectification of the kick plates would be to remove and replace them and that it would take about an hour to do so.
[13] Reasons at [16] and [23].
On review the applicant accepted it would take a couple of hours but that the same materials could be used.
In these circumstances, in view of the evidence that was given, I consider that the Magistrate’s estimate of a few hours is fair and reasonable. I do not see any reason for disturbing that estimate. I would however disallow the materials of $200 and not allow anything for materials because there was no evidence that the same materials could not be used.
The final item on the review related to the sealant to the gas top and the kitchen sink[14]. The Magistrate noted that the evidence of Mr Barlow and Mr Jankovic at trial was that the rectification of this work was relatively straightforward. The Magistrate therefore allowed the tradesperson a few hours for having to disconnect the gas and the work involved in removing and then reinstalling the stove top and kitchen sink, as well as applying a filler and sealant. The Magistrate allowed $100 for materials.
[14] Reasons at [15] and [24].
At trial, the defendant gave evidence that it was not a big job. On review, he disagreed with the finding of the Magistrate that it would take a few hours to perform the rectification work and submitted that it would take only one hour. The description of the rectification work required is set out above. In my opinion, that description provides a reasonable basis for the finding of the Magistrate that it would take a few hours. Again, I do not consider there is any basis for allowing materials in the sum $100 and I disallow that item. The applicant produced evidence that what needed to be done was to fix that sealing and that required sealant tape costing $8.45. Given that there was no evidence at trial of the cost of materials or the nature of the materials required, I accept the evidence of the applicant that the cost of materials in respect of this item should only be allowed in the sum of $8.45.
As there was no dispute in relation to the hourly rate, the appropriate judgment requires the calculation of the total number of hours allowed at the rate of $40 per hour and adding the cost of materials. I consider that the allowance of the Magistrate of a contingency of $400 in total to allow travel to and from work is fair and reasonable on a broad-brush approach. The provision of a contingency is usual in building work.
In all of the circumstances and pursuant to s 38(7)(d)(ii) of the Magistrates Court Act, I rescind the judgment of the Magistrate only insofar as it involves a recalculation of some of the items referred to above. I have deducted the sum of $572.55 for materials. I substitute a judgment in favour of the plaintiffs in the sum of $2927.45. I affirm the decision of the Magistrate, subject to that recalculation.