Buyer Central Pty Ltd v Sodhi
[2021] VMC 21
•1 June 2021
IN THE MAGISTRATES’ COURT OF VICTORIA
AT MELBOURNE
CIVIL DIVISION
Case No. L12833334
| BUYER CENTRAL PTY LTD (ACN 166 004 904) | Plaintiff |
| v | |
| PREET INDER SODHI | Defendant |
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| MAGISTRATE: | J GRAINGER |
| WHERE HELD: | Melbourne |
| DATE OF HEARING: | 21 April 2021 and 11 May 2021 |
| DATE OF DECISION: | 1 June 2021 |
| CASE MAY BE CITED AS: | Buyer Central Pty Ltd v Sodhi |
| MEDIUM NEUTRAL CITATION: | [2021 VMC 21 |
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CATCHWORDS – Motor vehicle accident dispute – Claim for cost of repairs and cost of hiring replacement car – Whether repair costs reasonable, unreasonable or extravagant - Whether plaintiff acted reasonably by renting replacement car for altruistic reasons – Obligations of the parties, their legal representatives and their expert witnesses under the Civil Procedure Act 2010 (Vic) – Application of Order 44 of the Magistrates Court General Civil Procedure Rules 2020 (Vic) to motor vehicle accident disputes referred to arbitration - Obligations of expert witnesses under the Magistrates Court General Civil Procedure Rules 2020 (Vic) and the Expert Witness Code of Conduct.
APPEARANCES: | Counsel | Solicitors |
| For Plaintiff | Mr E Richards | Yassine Lawyers & Associates |
| For Defendant | Mr D Ross | Ligeti Partners |
HER HONOUR:
Background
On 22 May 2020, Asad Ali (Mr Ali) rented a car (a 2016 white Toyota Camry sedan registration number 1QE7XA) for $290 per week for an open-ended time from the plaintiff, Buyer Central Pty Ltd (Buyer Central), who is also the owner of the car.
On 6 September 2020, Mr Ali was driving the car when it was damaged due to the negligence of the defendant, Mr Sodhi. These matters are not in dispute.
Buyer Central’s claim
Buyer Central claims that it has suffered losses totalling $8,238.87 because of Mr Sodhi’s negligence. Specifically, Buyer Central claims Mr Sodhi should pay the following amounts to it:
a)The cost of repairing the damaged car - $6,168.87 (excluding GST).
b)Andy McGrath’s assessment fee - $400 (excluding GST).
c)The cost of hiring a replacement car for Mr Ali for 19 days whilst the damaged car was being repaired - $1,670.
Following the accident, Buyer Central engaged Repair Sure Pty Ltd trading as Repairsure (Repairsure) to repair the damaged car. Andre Habchi, the director and manager of Buyer Central, is also a director of Repairsure and Angema Pty Ltd, the company from which Buyer Central rented the replacement car. Mr Habchi described the businesses as having a ‘symbiotic relationship’ (a mutually advantageous business relationship) but gave evidence that he is not involved in the management of, or the day to day running of Repairsure and that there is no profit-sharing arrangement between the three companies. This evidence was not challenged by Mr Sodhi and accordingly, I accept Mr Habchi’s evidence about this.
In relation to the claim for the cost of hiring a replacement car, Buyer Central claimed that it was an oral term of its agreement with Mr Ali that Buyer Central would provide Mr Ali with a replacement car if the car Mr Ali was renting was damaged because of someone else’s negligence.
Mr Sodhi’s defence
Mr Sodhi accepts that he is liable to pay Buyer Central $400 for the assessment fee but disputes the amounts claimed in relation to the cost of repairing the car and the car hire.[1]
[1] As I understood it and is often the case in motor vehicle disputes, Mr Sodhi’s insurance company is conducting the litigation on his behalf under its right to subrogation contained in the contact of insurance.
In relation to the claim for repairing the car, Mr Sodhi admits that Buyer Central is entitled to the reasonable costs of repairing the car but says that the reasonable cost of repairs is only $4,032.37 excluding GST.
In relation to the car hire claim, Mr Sodhi says he is not liable for any car hire costs because Buyer Central has not proved it needed to hire a car to replace the damaged car whilst it was being repaired. Specifically, Mr Sodhi claimed that Buyer Central has not proved it was obliged to replace the car hired by Mr Ali while it was being repaired or, if it can prove this, Buyer Central has not proved it could not replace the damaged car with a car owned by it. In other words, Mr Sodhi says that Buyer Central did not act reasonably when it hired a rental car for Mr Ali to drive while the car he had hired from Buyer Central was being repaired.
The law in relation to damages and whether a plaintiff has acted reasonably
The plaintiff (or injured party) bears the onus of proving the claim for damages on the balance of probabilities. In order to discharge that onus, the plaintiff must adduce sufficient evidence to establish the loss which the plaintiff claims has been incurred to enable the court to assess the damages which might be awarded in order to compensate that loss.[2]
[2]Leeda Projects Pty Ltd v Zeng, [2020] VSCA 192 [13].
10. A plaintiff’s claim for damages does not need to meet a high bar to be successful.[3]
[3] See for example the observations of Lord Loreburn LC in Lodge Holes Colliery Company Ltd v Wednesbury Corporation (1908) AC 323 [325].
11. However, a plaintiff’s right to claim damages is not unlimited.[4]
[4]On Tai Fung v Janice Rosemary Stocovaz [2006] NSWSC 1345 [33].
12. In relation to mitigation of damages:
a)A plaintiff has no duty to mitigate loss. Rather, damages are reduced to the extent that the plaintiff has not acted reasonably.
b)The onus of proof is on the defendant to show that the plaintiff has not acted reasonably in minimising loss arising from the defendant’s negligence.
c)The defendant must prove the extent of the plaintiff’s failure to minimise loss, that is, the amount of the plaintiff’s loss that was occasioned by the plaintiff’s failure to act reasonably.
d)A high standard of conduct is not required of the plaintiff, because the defendant is a wrongdoer.
e)A plaintiff will not be held to have acted unreasonably simply because the defendant can suggest other and more beneficial conduct, so long as it was reasonable for the plaintiff to act in the way that he did.[5]
[5] Portbury Development Company Pty Ltd v Ottedin Investments Pty Ltd, [2014] VSC 57 [158].
The law in relation to reasonable repairs
13. The law in relation to ‘reasonable repairs’ is set out in Stocovazv Fung[6] (Stocovaz).
[6] [2007] NSWCA 199.
14. In Stocovaz, the NSW Court of Appeal refused leave to appeal the decision of Patten AJ, who held:
There are two limitations on claims for the cost of repairs to a motor vehicle that has been damages as a result of someone else’s negligence:
a.The claim cannot be for more than the actual cost of repairs.
b.That cost must not be extravagant or unreasonable.
Extravagant and unreasonable in this context are interchangeable terms.
15. In particular, Handley AJA observed, inter alia, (and with references omitted) that:
36. ...His Honour treatedextravagant and unreasonable as synonymous in this context. This was also the understanding of Dr Lushington in The Pactolus (1856) Swab 173, which his Honour referred to. Ever since courts and commentators have treatedextravagant and unreasonable in this context as interchangeable. The authorities and texts which establish this are summarised in his Honour’s judgment.
37. There may not be a single fair and reasonable cost for repairing a damaged motor vehicle…. There is likely to be a range of costs all of which are fair and reasonable. In such a case acceptable evidence that a lower cost would be fair and reasonable cannot of itself establish that a higher cost was outside the range and not fair and reasonable.
38. The true question would be whether the cost incurred was outside the range. In my judgment this is only another way of asking whether the cost incurred wasextravagant or unreasonable.
The dispute in relation to the cost of repairing the damaged car
16. Before starting the repairs, Repairsure provided Buyer Central with a quote for repairs dated 7 September 2020 that totalled $6,843.87 excluding GST. Repairsure charged Buyer Central $100 per hour plus GST for labour including removing and replacing items (R&R), painting, miscellaneous labour and repairing items plus parts.
17. On the same day, Andy McGrath, a motor vehicle loss assessor assessed the damaged car and Repairsure’s quote and prepared a report that concluded that the reasonable cost of repairs totalled $6,168.87 excluding GST. This is the amount that Buyer Central claimed for the cost of repairs in its statement of claim dated 4 December 2020.
18. The following table sets out the repairs done by Repairsure, the amounts quoted for each of those repairs and the amounts claimed by Buyer Central following the assessment of the reasonable cost of repairs by Mr McGrath.
| DESCRIPTION OF DAMAGED ITEM | DESCRIPTION OF NATURE OF REPAIR AND COST | ||||
| R&R | PAINT | MISC | REPAIR | PARTS | |
| 1 | FRONT BAR COVER INC BLEND | 150 | |||
| 2 | LH FRONT BAR RETAINER | 25 | 30.65 | ||
| 3 | LH GUARD | 300 | 200 | ||
| 4 | LH GUARD HYBRID BADGE | 12.50 | |||
| 5 | LHF DOOR | 200 | | 300 | |
| 6 | LHF DOOR MIRROR | 50 | 25 | ||
| 7 | LHF DOOR HANDLE | | 25 | ||
| 8 | LHF DOOR CHROME MOULDING | 25 | |||
| 9 | LHR DOOR | 200 | | | |
| 10 | LHR DOOR HANDLE | | 25 | ||
| 11 | LHR DOOR CHROME MOULDING | 25 | |||
| 12 | LH QTR PANEL INC DOG LEG | | | ||
| 13 | LH FUEL FLARE | 25 | 25 | ||
| 14 | LH SILL PANEL | | |||
| 15 | LH CANT RAIL INC BLENDING | | |||
| 16 | LH CANT RAIL MOULD | 25 | |||
| 17 | REAR BAR | | | 202.98 | |
| 18 | REAR BAR LOWER | | 92.20 | ||
| 19 | LH REAR BAR RETAINER | | 30.54 | ||
| 20 | LH TAILLIGHT | | |||
| 21 | RH TAILLIGHT | | |||
| 22 | LHR ALLOY WHEEL AND TYRE – SH | 50 | 250 | ||
| 23 | SQUARE UP LH SIDE | | |||
| 24 | OVEN ALLOWANCE | 50 | |||
| 25 | ENVIRONMENTAL LEVY | 20 | |||
| 26 | PAINT MATERIALS AND SUPPLIES | 150 | |||
| 27 | MIX AND MATCH | 40 | |||
| 28 | DRIP CHECK | 30 | |||
| 29 | TAPING AND MASKING | | |||
| 30 | CONSUMABLES | | |||
| 31 | WHEEL ALIGNMENT INCLUDING DROP OFF, WAIT AND RETURN | 120 | |||
| 32 | HOIST INSPECTION / WATER TEST | 60 | |||
| 33 | ROAD TEST | 60 | |||
| 34 | WASTE DISPOSAL | 25 | |||
| 35 | ADMINISTRATION | 50 | |||
| 36 | RESET TOYOTA COMPUTER | 90 | |||
| 37 | DISINFECT & SANITISE COVID-19 | 200 | |||
| 38 | COMMERCIAL CAR WASH INC DETAILING | 100 | |||
| 39 | SET UP PULLING SYSTEM AND JACK | 200 | |||
| TOTALS | 967.50 | 2340 | 905 | 1300 | 656.37 |
| LABOUR | 3,417.50 | ||||
| PAINT | 2,740 | ||||
| PARTS | 656.37 | ||||
| SUBTOTAL | 6168.87 | ||||
| GST | 616.88 | ||||
| TOTAL | 6785.75 | ||||
19. On 19 October 2020, Ian McLeod, Mr Sodhi’s motor vehicle loss assessor assessed the reasonable cost of the repairs as totalling $4,032.37 excluding GST as set out in his report dated 27 October 2020. The assessment was done after the damaged car had been repaired based on photos taken by Mr McGrath when he assessed the car on 7 September 2020 before it was repaired.
20. Accordingly, the amount in dispute between the parties in relation to the repair costs was only $2,136.50, although 30 out of the 37 repair items claimed by Buyer Central were in dispute.
Mr McGrath and Mr McLeod’s evidence
21. Buyer Central relied on the report of Mr McGrath dated 7 September 2020 and Mr Sodhi relied on the report of Mr McLeod dated 27 October 2020 in relation to the issue of whether the repairs were necessary to restore the damaged car to its pre-accident condition and if so, whether the repair costs were reasonable.
22. Because Buyer Central’s claim relates to a motor vehicle accident dispute where the claim is for less than $20,000, the proceeding was referred to arbitration under s102 of the Magistrates’ Court Act 1989 (Vic). Whilst r44.02 of the Magistrates’ Court General Civil Procedure Rules 2020 (Vic) (Magistrates Court General Civil Procedure Rules) states that Order 44 does not apply to itemised quotes or assessments of total loss attached to a complaint under r5.05(2) or r5.05(3) or where the complaint has been referred to arbitration, Mr McGrath stated in his report that he had read and understood the Expert Witness Code of Conduct, which was also attached to his report, and that his report had been prepared in accordance with the Code. Mr McGrath’s letterhead and CV also refer to his ‘independent assessments and valuations’. Similarly, Mr McLeod stated in his report that he had read the Expert Witness Code of Conduct and agreed to be bound by it. A document headed ‘Expert Witness Credentials’ and a copy of the Expert Witness Code of Conduct were also attached to Mr McLeod’s report.
23. For these reasons, when the parties called their respective assessors to give oral evidence at the arbitration, it was my understanding that Mr McGrath and Mr McLeod were giving evidence in their capacity as expert witnesses as well as motor vehicle loss assessors, and that they would therefore act in accordance with their obligations under ss23 and 24 of the Civil Procedure Act 2010 (Vic) (CPA)[7] and paragraphs 2 and 7 of the Expert Witness Code of Conduct.[8]
[7] Sections 10(3) and (4) of the Civil Procedure Act 2010 state that the overarching obligations (other than those specified in ss18, 19, 22 and 26) apply to any expert witness in a civil proceeding and that these obligations are in addition to any existing duties applying to expert witnesses (such as those set out in the Expert Witness Code of Conduct).
[8] The Expert Witness Code of Conduct is contained in Form 44A of the Magistrates’ Court General Civil Procedure Rules 2020. Paragraph 2 of the Code states that an expert witness’ paramount duty is to assist the court impartially on matters relevant to their area of expertise, which overrides any duty to the parties to the proceedings or any other person retaining the expert witness such as an insurance company. Paragraph 7 of the Code states where expert witnesses confer, they must exercise their independent judgment in relation to every conference in which they participate under a direction of the court, they must not act on any instruction or request to withhold or avoid agreement, and they must endeavour to reach agreement with the other expert witness on any issue in dispute between them, or failing agreement, endeavour to identify and clarify the basis of disagreement on the issues which are in dispute.
24. Before Mr McGrath and Mr McLeod gave their oral evidence, counsel for the parties informed me that they had conferred before the arbitration, presumably in anticipation of me directing that they do so in accordance with r44.06 of the Magistrates’ Court General Civil Procedure Rules and s65I of the CPA.
25. Counsel for the parties also informed me that Mr McGrath and Mr McLeod had been unable to resolve their differences of opinion in relation to what repairs were necessary and what the reasonable cost of the repairs were, or to narrow the scope of the issues in dispute.
26. This meant that even after Mr McGrath and Mr McLeod had conferred, the parties were still apart by $2,136.50 and the 30 repair items that were in dispute when Mr McLeod’s report was prepared on 27 October 2020 were still in dispute at the start of the arbitration.
27. Given the large number of items in dispute in relation to the costs of repairs, I directed Mr McGrath and Mr McLeod to give evidence concurrently under s65K of the CPA.
28. The purpose of expert witnesses giving evidence concurrently is to enable the Magistrate, the parties, their legal representatives and their expert witnesses to ‘engage in a cooperative endeavour to identify the issues and arrive where possible at a common resolution of them’.[9] A direction that expert witnesses give evidence concurrently also furthers the overarching purpose of the CPA, which is to facilitate the just, efficient, timely and cost‑effective resolution of the real issues in dispute and the main object of Part 4.6 of the CPA, which relates to expert witnesses and expert evidence.
[9] P McClellan, ‘New Method with Experts – Concurrent Evidence’ (2010) 3 Journal of Court Innovation 259 at 264).
29. Specifically, s65F of the CPA states that the main object of Part 4.6 is to further the overarching purpose by:
a)enhancing the case management powers of a court in relation to expert evidence in civil proceedings,
b)restricting expert evidence to that evidence which is reasonably required to resolve a civil proceeding, and
c)emphasising the primary duty of an expert witness to the court.
30. Despite the arbitration only being listed for two hours, which is the standard amount of time allocated to arbitrations, the arbitration ran for more than five hours over two days and Mr McGrath and Mr McLeod gave evidence for over two hours over two days.[10] The only concessions made by either expert witness or the parties’ legal representatives during the arbitration was a concession made by Mr McGrath in relation to item 5 that a door was not removed before it was repaired, although this did not change his opinion in relation to the reasonableness of the cost of the repair, and a concession made by counsel for Mr Sodhi in relation to item 4 that the amount of $7.50 was too small to properly maintain an objection over.
[10] Mr Ali, Mr Habchi and the director of the repairer, George Yannas also gave evidence during the arbitration.
31. This is despite the fact that, as stated above, the total amount in dispute in relation to the cost of repairs was only $2,136.50, and the individual amounts in dispute were as small as $14 (item 25), $25 (items 2, 8, 11, 13, 22 and 34), $30 (items 7, 10, 18, 20 and 28) and $35 (item 30).
32. Accordingly, by the end of the arbitration, it was necessary for me to make 29 findings of fact in relation to Buyer Central’s claim for the cost of repairs where the amount in dispute was only $2,136.50.
Findings in relation to the dispute about the cost of repairs
33. Attachment A sets out the final position of the parties in relation to each of the repair items in accordance with the reports of their respective experts and the concessions made by Mr McGrath and counsel for Mr Sodhi during the arbitration. It also summarises the experts’ evidence in relation to each item and my reasons for my decision in relation to each item.
34. George Yannas, the director and manager of Repairsure, also gave evidence that all the repairs in the quote dated 7 September 2020 were necessary and performed as described in the quote. I accept this evidence, which was not challenged by Mr Sodhi. Mr Yannas also gave evidence Repairsure’s costs for the repairs (as assessed by Mr McGrath) were fair and reasonable. I do not place much weight on this evidence given that Mr Yannas’ business repaired the damaged car and Mr Yannas is not an independent witness.
35. In summary, having considered all of the evidence in relation to the necessity and reasonableness of every repair item claimed by Buyer Central, I have allowed the whole of its claim for the repair costs save for item 37, which I have only allowed in part.
36. In most instances, this was because Mr McLeod did not satisfy me that the amount claimed by Buyer Central was extravagant or unreasonable or outside the range of what is fair and reasonable. Rather, he simply tended to assert during his evidence that the disputed repair costs were not standard and were unreasonable and that the repairs could have been done in less time (and therefore more cheaply, as Repairsure charged on an hourly rate), none of which proves that the repairs were extravagant or unreasonable. As Patten AJ said in Fung v Stocovaz, a defendant is not simply entitled to show that the work could have been carried out more cheaply to have a deduction on that account from the amount claimed.[11]
[11] On Tai Fung v Janice Rosemary Stocovaz [2006] NSWSC 1345 [37].
37. Where the expert witnesses’ evidence differed in relation to whether the work done or item claimed was necessary or standard in the motor vehicle repair industry, I prefer Mr McGrath’s evidence, as he gave more cogent explanations for why an item should be considered necessary or reasonable, and I found his evidence about current motor vehicle repair industry practices in relation to repairs and charges to be more persuasive than Mr McLeod’s evidence, except for my findings in relation to item 37. This is despite finding that both Mr McGrath and Mr McLeod were credible expert witnesses.
38. In reaching my decision to allow all of Buyer Central’s claim for the cost of repairs other than item 37, I have also considered the claim for the cost of repairs as a whole, which totalled $6,168.87 excluding GST.
39. In my view, whilst repair costs of $6,168.87 may arguably be at the higher end of the range of fair and reasonable costs, it is not an extravagant or unreasonable amount to charge for repairing the damage to the car, taking into account the nature and extent of the damage as evidenced by the photos, which was around the left hand side aperture,[12] which appears reasonably extensive.
[12] The large side panel making up the rear bumper bar, door frame and side window frame.
40. Lastly, in reaching my decision to allow all of Buyer Central’s claim for the repair costs other than item 37, I have also considered whether the fact that the relationship between Buyer Central and Repairsure is not an arms’ length relationship is relevant to my assessment of Buyer Central’s claim for the cost of repairing the damaged car.
41. The relationship between Buyer Central and Repairsure is not an arms’ length relationship because:
a)Andre Habchi, the director and manager of Buyer Central, is also a director of Repairsure, and
b)George Yannas, the director and manager of Repairsure, is also a director of Buyer Central.[13]
[13] Mr Habchi and Mr Yannas are also both directors of the hire car company that Buyer Central rented a car for Mr Ali from. They also both gave evidence that they were not involved in the day to running of that business.
42. However, as set out in paragraph 4 above, I accept Mr Habchi’s evidence that he is not involved in the management of, or the day to day running of Repairsure, and that there is no profit-sharing arrangement between Buyer Central and Repairsure. In addition, Repairsure’s quote was assessed by Mr McGrath, who is an independent motor vehicle loss assessor who I have found to be a credible expert witness. In these circumstances, I am satisfied that the relationship between Buyer Central and Repairsure is not relevant to my assessment of Buyer Central’s claim for the cost of repairing the damaged car in this instance.
Is Buyer Central entitled to damages for the cost of hiring a replacement car for Mr Ali?
43. Mr Ali gave evidence that he rented the car that was damaged for the purpose of earning an income as an Uber driver despite the rental agreement prohibiting him from using the car for this purpose. He also gave evidence that on the day of the accident, he was working as an Uber driver. I accept Mr Ali’s evidence about these matters, particularly as Mr Ali provided a copy of his bank statement to the court that showed payments made by Uber to him in the weeks before the accident. I also accept Mr Ali’s evidence that after his car was damaged by Mr Sodhi, he was ‘given’ another car to drive by Buyer Central while the damaged car was being repaired.
44. I also accept the evidence of Mr Habchi that on the date of the accident, Buyer Central owned more than 70 cars, all of which were rented out. Mr Habchi relied on a utilisation report in support of his evidence about this.
45. Mr Habchi and Mr Ali also gave evidence that there was an oral agreement between Buyer Central and Mr Ali that obliged Buyer Central to provide Mr Ali with another car if the car being rented by him was damaged because of someone else’s negligence.
46. For the following reasons, I am not satisfied that there was an oral agreement between Mr Habchi, on behalf of Buyer Central and Mr Ali to this effect:
a)The written rental agreement between Buyer Central and Mr Ali did not require Buyer Central to provide Mr Ali with another car if the car being rented by him was damaged because of someone else’s negligence. However, it did require Mr Ali to pay Buyer Central $1000 if he damaged the rental car.
b)Mr Habchi and Mr Ali evidence about the alleged oral agreement was vague in relation to the circumstances surrounding the making of the alleged oral agreement and neither of them explained why this was the only term of the rental agreement that was not in writing.
c)In my view, it is improbable that Mr Habchi, on behalf of Buyer Central and Mr Ali entered into the alleged oral agreement, particularly as it is not always immediately apparent after a motor vehicle accident which driver was negligent, and this issue frequently has to be decided by a court many months after the accident and many months after the need for a replacement hire car is likely to have ended. In addition, there was no evidence that such an agreement is an occasional, let alone common business practice in the hire car industry.
47. Mr Habchi also gave evidence that Buyer Central mostly rents cars to Pakistani international students for the purpose of ‘gig economy’ work such as driving for ride share companies or food delivery companies and that it rented the replacement car for Mr Ali ‘to support him’ while his rental car was being repaired.
48. Whilst I accept this evidence, which is consistent with Mr Ali’s evidence that he was given a replacement car by Buyer Central whilst his damaged rental car was being repaired, and because it was not challenged by Mr Sodhi, Mr Sodhi has satisfied me that Buyer Central did not act reasonably because:
a)I have found that when Buyer Central rented a replacement car for Mr Ali, it did so in the absence of any contractual obligation to do so.
b)Whilst it is arguably subjectively reasonable for Buyer Central to rent a replacement car for Mr Ali for altruistic reasons or to engender good will among its customers, in my view it is unreasonable to ask Mr Sodhi to pay damages for the costs incurred by Buyer Central in doing so. This is particularly so in circumstances where Mr Ali could have rented a replacement car himself and made his own claim against Mr Sodhi for the cost of doing so, or he could have made a claim against Mr Sodhi for any income lost by him while the car he had rented from Buyer Central was being repaired.
49. For these reasons, Buyer Central’s claim for the cost of renting a replacement car for Mr Ali is dismissed but its claim for the costs of repairing the damaged car is allowed at $6,043.87, excluding GST, and Mr McGrath’s fee of $400, excluding GST is also allowed. The total amount awarded to Buyer Centre is therefore $6443.87.
The obligations of the parties, their legal representatives and their expert witnesses under the Civil Procedure Act and the Expert Witness Code of Conduct
50. In my view, the matters set out in paragraphs 21 to 32 above raise the possibility that the parties, their legal representatives (excluding counsel) or their expert witnesses may have contravened their overarching obligations under the CPA, which are set out in Part 2.3, and that the parties’ expert witnesses may have contravened their obligations under the Expert Witness Code of Conduct.
51. In relation to the obligations of the parties, their legal representatives and their expert witnesses under the CPA, I am concerned that they may have contravened their obligations to use reasonable endeavours:
a)to resolve the dispute by agreement (this obligation does not apply to the expert witnesses), or
b)to resolve as many issues in dispute by agreement as possible (in this case, as many of the 30 repair items in disputes as possible), and to narrow the scope of the remaining issues in dispute if the whole dispute could not be resolved by agreement, and
c)to ensure that costs are reasonable and proportionate to the complexity or importance of the issues in dispute and the amount in dispute, taking into account that the total amount in dispute in relation to repairs costs was only $2,136.50, and that many of the individual amounts in dispute were as small as $7.50 (item 4), $14 (item 25), $25 (items 2, 8, 11, 13, 22 and 34), $30 (items 7, 10, 18, 20 and 28) and $35 (item 30).[14]
[14] Sections 22, 23 and 24 of the Civil Procedure Act 2010 (Vic).
52. In relation to the expert witnesses’ obligations under the Expert Witness Code of Conduct, I am concerned that they may have contravened their obligations set out in paragraphs 2 and 7 of the Code, which state, amongst other things, that:
a)the experts’ paramount duty is to assist the court impartially on matters relevant to their area of expertise, which overrides any duty to the parties to the proceedings or any other person retaining the expert witness (such as an insurance company), and
b)the experts must exercise their independent judgment in relation to every conference in which they participate, endeavour to reach agreement with the other expert witness on any issue in dispute between them, or failing agreement, endeavour to identify and clarify the basis of disagreement on the issues which are in dispute.
53. In particular, I am concerned that the expert witnesses’ approach to their role in the litigation appeared more adversarial than cooperative, and that the experts’ may not have sufficiently turned their minds to how they could assist the court impartially in accordance with their paramount duty to the court. My concerns stem from two matters. First, the fact that the expert witnesses failed to agree on even one item in dispute during their conference or whilst they were giving oral evidence concurrently. Second, the nature, extent and duration of the experts oral evidence about the 30 repair items that were in dispute, which is summarised in Attachment A below, and which, based on my observations during the arbitration, can be fairly characterised as somewhat intransigent and pernickety, particularly in the case of Mr McLeod’s evidence, and overall unnecessarily lengthy given the relatively small total amount in dispute and the many very small individual amounts in dispute.
54. I am also concerned that the expert witnesses’ approach to their role in the litigation may not have facilitated the just, efficient, timely and cost‑effective resolution of the real issues in dispute in relation to the repair costs, which was:
Were the repair costs extravagant and unreasonable and outside the range of what should be considered fair and reasonable in circumstances where the courts have repeatedly held that ‘unreasonableness is not established because less costly or burdensome measures by way of mitigation can be suggested with the wisdom of hindsight when the time finally comes for assessing the damages due to the injured party by the wrong-doer’?[15]
[15]Fallon v Johnson, [2018] VSC 273, [30].
55. It may also be the case that the parties or their legal representatives (excluding counsel) were wholly or partially responsible for what appeared to be on the face of it, an adversarial and somewhat intransigent approach taken by the expert witnesses to reaching any agreement in respect of the 30 repair items that were in dispute.
56. I note that under s28 of the CPA, the court may take into account any contravention of the overarching obligations in exercising its discretion as to costs and that the court may make any order it considers appropriate in the interests of justice on application of any party to a civil proceeding or on the court’s own motion under s29 of the CPA if the court is satisfied on the balance of probabilities that a person has contravened any overarching obligation.
57. However, as these matters were not raised with the parties by me during the arbitration, and as an order under s 29 of the CPA cannot be made without the court being satisfied on the balance of probabilities that a party has contravened the overarching obligations, it goes without saying that such an order would not be made before the parties and the expert witnesses were given an opportunity to give evidence to the court about their compliance with the overarching obligations and to make submissions about what orders, if any, should be made.
58. Accordingly, the parties will be given the opportunity to make any applications for cost orders and any submissions in relation to whether I should make any orders under ss28 and 29 of the CPA after they have been provided with a copy of my reasons.
| 3 | ATTACHMENT A | |||||||||
| ITEM No. | DESCRIPTION OF DAMAGED ITEM | DESCRIPTION OF REPAIR, AMOUNT ALLOWED BY ANDY MCGRATH AND AMOUNT ALLOWED BY IAN MCLEOD (bold and italics) | AMOUNT IN DISPUTE | SUMMARY OF ANDY MCGRATH’S EVIDENCE | SUMMARY OF IAN MCLEOD’S EVIDENCE | COMMENT AND DECISION | ||||
| R&R | PAINT | MISC | REPAIR | PARTS | ||||||
| 1 | FRONT BAR COVER INC BLEND | 150 0 | 150 | Required for consistent colour | Not necessary to blend to side panel | Necessary/reasonable - claim allowed | ||||
| 2 | LH FRONT BAR RETAINER | 25 0 | 30.65 | 25 | Bought, so had to be fitted – bumper bar could have been partially removed | Allowed part because invoice for it – not allowing labour because front bumper bar not taken off | If bought part, likely fitted part - claim allowed | |||
| 3 | LH GUARD | 300 250 | 200 100 | 150 | Standard and reasonable time/amount – observed extensive damage - photos show extensive repairs necessary | Same amount claimed for repairs to door but damage to door much more extensive therefore amount claimed excessive | Clearly within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | |||
| 4 | LH GUARD HYBRID BADGE | 12.50 5 | 7.50 | Counsel conceded amount too small to dispute – claim allowed | ||||||
| 5 | LHF DOOR | 200 150 | 300 | 50 | R&R - Standard and reasonable time/amount – work itemised – conceded door repaired without being removed but photos show door dismantled and assembled (stripped internally) | R&R - door not removed and replaced - invoice doesn’t say ‘dismantled and assembled’ | R&R – Accept door dismantled and assembled - clearly within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | |||
| ITEM No. | DESCRIPTION OF DAMAGED ITEM | DESCRIPTION OF REPAIR, AMOUNT ALLOWED BY ANDY MCGRATH AND AMOUNT ALLOWED BY IAN MCLEOD (bold and italics) | AMOUNT IN DISPUTE | SUMMARY OF ANDY MCGRATH’S EVIDENCE | SUMMARY OF IAN MCLEOD’S EVIDENCE | COMMENT AND DECISION | ||||
| R&R | PAINT | MISC | REPAIR | PARTS | ||||||
| 5 | LHF DOOR (cont.) | 350 250 | 100 | Painting - Standard and reasonable time/amount | Painting - $250 well within industry standard | Painting - Within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | ||||
| 6 | LHF DOOR MIRROR | 50 20 | 25 0 | 45 | Need to paint mirror and door – otherwise risk variance in colour – photos show painted | Not necessary because mirror not repaired – if necessary, amount reasonable | Necessary/reasonable - claim allowed | |||
| 7 | LHF DOOR HANDLE | 30 0 (part of item 5) | 25 | 30 | As above (item 6) | As above (item 6) | As above (item 6) | |||
| 8 | LHF DOOR CHROME MOULDING | 25 0 (part of item 5) | 25 | As above (item 6) | As above (item 6) | As above (item 6) | ||||
| 9 | LHR DOOR | 200 150 | 350 250 | 300 | 50 100 | As above (item 5) | As above (item 5) | As above (item 5) | ||
| 10 | LHR DOOR HANDLE | 30 0 (part of item 9) | 25 | 30 | As above (item 6) | As above (item 6) | As above (item 6) | |||
| 11 | LHR DOOR CHROME MOULDING | 25 0 (part of item 9) | 25 | As above (item 6) | As above (item 6) | As above (item 6) | ||||
| ITEM No. | DESCRIPTION OF DAMAGED ITEM | DESCRIPTION OF REPAIR, AMOUNT ALLOWED BY ANDY MCGRATH AND AMOUNT ALLOWED BY IAN MCLEOD (bold and italics) | AMOUNT IN DISPUTE | SUMMARY OF ANDY MCGRATH’S EVIDENCE | SUMMARY OF IAN MCLEOD’S EVIDENCE | COMMENT AND DECISION | ||||
| R&R | PAINT | MISC | REPAIR | PARTS | ||||||
| 12 | LH QTR PANEL INC DOG LEG | 300 250 | 300 | 50 | Standard and reasonable time/amount | $250 standard | Clearly within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | |||
| 13 | LH FUEL FLARE | 25 0 | 25 | 25 | Necessary to remove to paint | Not necessary to remove – most repairers would paint on car | Accept repair’s evidence removed necessary/reasonable - claim allowed | |||
| 14 | LH SILL PANEL | 100 | n/a | No dispute – claim allowed | ||||||
| 15 | LH CANT RAIL INC BLENDING | 100 | n/a | No dispute – claim allowed | ||||||
| 16 | LH CANT RAIL MOULD | 25 | n/a | No dispute – claim allowed | ||||||
| 17 | REAR BAR | 150 | 300 250 | 202.98 | 50 | Standard and reasonable time/amount | New part - excessive | Clearly within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | ||
| 18 | REAR BAR LOWER | 40 10 | 110 | 92.20 | 30 | Separate charges because separate sections | Item 18 part of item 17 | Clearly within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | ||
| 19 | LH REAR BAR RETAINER | 0 | 30.54 | n/a | No dispute – claim allowed | |||||
| ITEM No. | DESCRIPTION OF DAMAGED ITEM | DESCRIPTION OF REPAIR, AMOUNT ALLOWED BY ANDY MCGRATH AND AMOUNT ALLOWED BY IAN MCLEOD (bold and italics) | AMOUNT IN DISPUTE | SUMMARY OF ANDY MCGRATH’S EVIDENCE | SUMMARY OF IAN MCLEOD’S EVIDENCE | COMMENT AND DECISION | ||||
| R&R | PAINT | MISC | REPAIR | PARTS | ||||||
| 20 | LH TAILLIGHT | 80 50 | 30 | Not excessive – four lugs – delicate operation | Excessive – three nuts, one locator hole – three minute job | Clearly within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | ||||
| 21 | RH TAILLIGHT | 0 | n/a | Not claimed | ||||||
| 22 | LHR ALLOY WHEEL AND TYRE – SH | 50 25 | 250 | 25 | Not excessive – done by hand | Excessive – not done by hand – pneumatic wrench used | Clearly within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | |||
| 23 | SQUARE UP LH SIDE | 200 0 | 200 | Separate item – quite a process - photos show extensive damage – can’t include in item 12 | Not necessary – not separate process – continuous process -should be included in R&R for item 12 | Accept Mr McGrath’s evidence reasonable to claim separately - claim allowed | ||||
| 24 | OVEN ALLOWANCE | 50 | n/a | No dispute – claim allowed | ||||||
| 25 | ENVIRONMENTAL LEVY | 20 6 | 14 | Standard cost – toxic waste such as paint and thinners must be collected and safely disposed of – different item to item 34 (waste disposal) | Should be included in item 34 (waste disposal) | Clearly within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | ||||
| ITEM No. | DESCRIPTION OF DAMAGED ITEM | DESCRIPTION OF REPAIR, AMOUNT ALLOWED BY ANDY MCGRATH AND AMOUNT ALLOWED BY IAN MCLEOD (bold and italics) | AMOUNT IN DISPUTE | SUMMARY OF ANDY MCGRATH’S EVIDENCE | SUMMARY OF IAN MCLEOD’S EVIDENCE | COMMENT AND DECISION | ||||
| R&R | PAINT | MISC | REPAIR | PARTS | ||||||
| 26 | PAINT MATERIALS AND SUPPLIES | 150 0 | 150 | Separate cost – should not be included in labour costs for painting | Should be included in labour costs for painting – other materials like body filler and sandpaper not separately claimed for | Accept Mr McGrath’s evidence reasonable to claim separately – claim allowed | ||||
| 27 | MIX AND MATCH | 40 | n/a | No dispute – claim allowed | ||||||
| 28 | DRIP CHECK | 30 0 | 30 | Necessary to check sealer working after sealer replaced on back door | Not necessary – not charged for painting inside of door – sealer not replaced | Accept Mr McGrath’s evidence reasonable to claim - claim allowed | ||||
| 29 | TAPING AND MASKING | 0 (inc in item 26) | n/a | Not claimed | ||||||
| 30 | CONSUMABLES | 50 15 | 35 | Low amount claimed – includes items such as rags, car wash, disinfectant | Not itemised – usually included in hourly rate – does not include paint materials or supplies | Clearly within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | ||||
| 31 | WHEEL ALIGNMENT INCLUDING DROP OFF, WAIT AND RETURN | 120 | n/a | No dispute – claim allowed | ||||||
| ITEM No. | DESCRIPTION OF DAMAGED ITEM | DESCRIPTION OF REPAIR, AMOUNT ALLOWED BY ANDY MCGRATH AND AMOUNT ALLOWED BY IAN MCLEOD (bold and italics) | AMOUNT IN DISPUTE | SUMMARY OF ANDY MCGRATH’S EVIDENCE | SUMMARY OF IAN MCLEOD’S EVIDENCE | COMMENT AND DECISION | ||||
| R&R | PAINT | MISC | REPAIR | PARTS | ||||||
| 32 | HOIST INSPECTION / WATER TEST | 60 0 | 60 | Standard - part of warranty process to check taillights not leaking and seals working – part of warranty process | Not necessary – only check for mechanical problems when car on hoist - can check taillights and seals when car washed when repairs finished – only takes a couple of minutes | Accept Mr McGrath’s evidence standard procedure - clearly within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | ||||
| 33 | ROAD TEST | 60 0 | 60 | Standard procedure once repairs are finished - repairs are not always finished when wheel alignment done | Not necessary – can road test car after taken for wheel alignment – double handling – not fair and reasonable | Accept Mr McGrath’s evidence standard procedure - clearly within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | ||||
| 34 | WASTE DISPOSAL | 25 0 | 25 | Standard charge for rubbish removal – more than fair and reasonable – standard hourly rate $100 to $180 – hourly rate charged $100 | Part of environmental levy – removal of bin in hourly rate – hourly rate $100, some repairs charge $80 | Accept Mr McGrath’s evidence standard charge - clearly within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | ||||
| ITEM No. | DESCRIPTION OF DAMAGED ITEM | DESCRIPTION OF REPAIR, AMOUNT ALLOWED BY ANDY MCGRATH AND AMOUNT ALLOWED BY IAN MCLEOD (bold and italics) | AMOUNT IN DISPUTE | SUMMARY OF ANDY MCGRATH’S EVIDENCE | SUMMARY OF IAN MCLEOD’S EVIDENCE | COMMENT AND DECISION | ||||
| R&R | PAINT | MISC | REPAIR | PARTS | ||||||
| 35 | ADMINISTRATION | 50 0 | 50 | Standard charge for administration | Not necessary - reception and administration staff are included in hourly rate | Accept Mr McGrath’s evidence standard charge - clearly within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | ||||
| 36 | RESET TOYOTA COMPUTER | 90 0 | 90 | Standard procedure to reset computer and do diagnostic check after battery disconnected | Not necessary – quote does not mention battery disconnected – only need to reset computer if bumper bar or doors removed – anti zappers on battery prevent computer faults | Accept Mr McGrath’s evidence work was necessary - clearly within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | ||||
| 37 | DISINFECT & SANITISE COVID-19 | 200 25 | 175 | The car was disinfected before and after it was repaired - $100 per clean is reasonable | Not necessary to do a full clean – no mention of car’s condition when it entered the workshop on quote - only necessary to sanitise the keys, steering wheel and transmission – 15 minute job – cost unreasonable | Whilst I accept it was necessary to disinfect and sanitise the car when it arrived, I consider this charge outside the range of fair and unreasonable charges and to be extravagant considering the charge amounts to one hour’s work, which is what was charged for the commercial car wash and detailing that was done when the repairs were completed. | ||||
| ITEM No. | DESCRIPTION OF DAMAGED ITEM | DESCRIPTION OF REPAIR, AMOUNT ALLOWED BY ANDY MCGRATH AND AMOUNT ALLOWED BY IAN MCLEOD (bold and italics) | AMOUNT IN DISPUTE | SUMMARY OF ANDY MCGRATH’S EVIDENCE | SUMMARY OF IAN MCLEOD’S EVIDENCE | COMMENT AND DECISION | ||||
| R&R | PAINT | MISC | REPAIR | PARTS | ||||||
| 37 | DISINFECT & SANITISE COVID-19 (cont.) | (cont.) Claim allowed in part only - $50 for disinfecting and sanitising the car on arrive and $25 for disinfecting and sanitising the car after repairs were completed, taking into account the additional cleaning claimed in item 38 below. | ||||||||
| 38 | COMMERCIAL CAR WASH INC DETAILING | 100 35 | 165 | Standard to wash and detail car after repairs completed – cost includes materials - standard and reasonable cost | Unreasonable – apprentice could have washed any dust off the car | Accept Mr McGrath’s evidence - clearly within range of fair and reasonable cost – no evidence outside the range, extravagant or unreasonable – claim allowed | ||||
| 39 | SET UP PULLING SYSTEM AND JACK | 200 25 | 175 | Standard fee – holds car in position whilst repairs being done – substantial repairs done around aperture (large side panel making up rear bumper bar, door frame and side window frame) – would have been done a few times during course of repairs | Unreasonable - standard fee 25$ (15 minutes) – pulling system and jack like a little trolley on wheels – car slots in, no need to mount, car sits there during repairs, chained up, clamps self-tensioning and self-tightening | Accept Mr McGrath’s evidence cost reasonable – cost claimed at the higher end of the range of fair and reasonable cost but no evidence outside the range, extravagant or unreasonable – claim allowed | ||||
| R&R | PAINT | MISC | REPAIR | PARTS | |
| SUB-TOTALS | 967.50 | 2340 |
| 1300 | 656.37 |
| TOTAL | 6043.87 | ||||
| GST | 604.39 | ||||
| TOTAL INC GST | 6648.26 |
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