Chetty v Automotive Computer Diagnostic Centre (ACDC) Pty Ltd (Civil Dispute)
[2016] ACAT 38
•12 May 2016
ACT CIVIL & ADMINISTRATIVE TRIBUNAL
CHETTY & ANOR v AUTOMOTIVE COMPUTER DIAGNOSTIC CENTRE (ACDC) PTY LTD (Civil Dispute) [2016] ACAT 38
XD 1230/2015
Catchwords: CIVIL DISPUTE – whether costs of vehicle repair was reasonable
Legislation cited: Sale of Goods Act 1954 s 13
Cases cited:Baldwin v Jones and Cubit [2000] QBT 30
Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337
Eagle Sea Pty Ltd V Radford and Dick t/as Radford Cartage Contractor [2012] TASSC 41
Horton v Jones [No2] (1939) SR (NSW) 305
Tickner v The Boat Clinic Pty Ltd (Civil Claims) [2015] VCAT 2062
Tribunal: President G McCarthy
Date of Orders: 12 May 2016
Date of Reasons for Decision: 12 May 2016
AUSTRALIAN CAPITAL TERRITORY )
CIVIL & ADMINISTRATIVE TRIBUNAL) )
XD 1230/2015
BETWEEN:
RAJESH CHETTY
KATE CHETTY
Applicants
AND:
AUTOMOTIVE COMPUTER DIAGNOSTIC CENTRE (ACDC) PTY LTD
Respondent
TRIBUNAL: President G McCarthy
DATE: 12 May 2016
ORDER
1.The respondent pay the applicants $188.65.
2.The application is otherwise dismissed.
………………………………..
President G McCarthy
REASONS FOR DECISION
In November 2012 the applicants, Kate and Rajesh Chetty, purchased a second hand motorcar from a dealer in Brisbane. Seven months later the car broke down. It had significant mechanical defects arising from a broken timing belt.
The applicants engaged Automotive Computer Diagnostic Centre Pty Ltd (ACDC) to repair the defects for which they were charged and paid $7,956.65. They paid the money not because they accepted that the invoice was fair and reasonable but in order to recover their car and with the expectation that they would be reimbursed for this repair cost by the Brisbane dealer or its insurer. They understood that the defects and resulting damage would be covered under the statutory warranty provided with the purchase of the car.
The applicants engaged in lengthy negotiations with the dealer’s insurer following which they received $5,764.98. This sum, the applicants said, was agreed as a reasonable assessment of how much the repairs should have cost. The applicants have therefore brought an application to the Tribunal seeking a refund or partial refund from ACDC for several items the cost of which, they say, was unreasonable. These items were revised in an amended application filed in January 2016.
I have proceeded with the amended items, totalling $3,350.81 (inclusive of GST), which are as follows:
(a)Determine cause of failure - $695.89
(b)Water pump timing belt kit major - $334.58
(c)Replace water pump - $881.46
(d)Cylinder head overhaul - $368.54
(e)R&R cylinder head including stripped cam bolts - $750.72
(f)Petrol - $15
The applicants did not state a legal basis on which they brought their claim against ACDC. The case was presented with reliance on the broad proposition that the price ACDC charged for these items was unreasonable. Counsel for the respondent did not raise the question of liability and simply denied the claim on the grounds that ACDC’s invoice was reasonable.
From the applicants’ viewpoint, I can understand how the issue of legal liability may have been overlooked. They claimed first against the seller of the car for breach of warranty. The seller’s insurer accepted liability, after much negotiation and provision of an engineer’s report provided with ACDC’s assistance. The insurer later reached agreement with the applicants as to the reasonable costs of the repairs ($5,764.98) arising from the breach of warranty.
The applicants’ contention seemed to be that the additional $2,191.67 charged by ACDC for the repairs must therefore, by definition, have been unreasonable. If I am right in that understanding, for two reasons I reject the argument.
First, opinions will invariably differ as to a reasonable price for work. Different service providers will propose and charge different prices according to how they choose to run their businesses. Prospective purchasers ‘shop around’ and choose accordingly. It does not follow that the applicants’ agreement with the insurer about the reasonable cost of the repairs means that the costs charged by a third party, and ACDC in this case, were unreasonable.
Secondly, it is somewhat contradictory for the applicants to have strenuously protested to the seller’s insurer that ACDC’s invoice represented the reasonable costs of the repairs to their car, and then (to the extent of the items now put in issue) contend otherwise in these proceedings.
In my view, the applicants’ liability to ACDC must be determined without reference to the cost of the repairs separately agreed between the applicants and the seller’s insurer. It would seem the applicants agree, noting they seek an amount by way of refund from ACDC of approximately $1,200 more than the difference between ACDC’s invoice and the amount they received from the seller’s insurer.
The central question that the applicants ask the Tribunal to determine is whether the price ACDC charged for the items of work now in issue was reasonable.
In my view, by two different means, the Tribunal has jurisdiction to determine that question and to make orders accordingly. That jurisdiction arises from the fact that the work was done without ACDC informing the applicants of the price it would charge for the work or the applicants agreeing to a price.
(a)First, where a contract is established but the contract is silent as to price, the court will imply a term that the purchaser pay a reasonable price and then quantify that price as best it can.
(b)Secondly, where services are provided without reference to a contract or where there is an unenforceable contract, the law imposes an obligation to pay a reasonable price for the work by reference to principles of quantum meruit meaning “as much as is deserved”. Quantum meruit is an action for payment of the reasonable value of services performed.
I deal with each in turn.
Implied term
Sometimes a contract will be incomplete regarding important terms. In such circumstances, where possible, courts and tribunals try to find ways of holding parties to their agreements by implying terms necessary to give efficacy to the agreement. Relevantly in this case, the tribunal may imply a term that a purchaser must pay a reasonable price.
Insofar as ACDC’s invoice for parts (i.e. goods) is challenged, this principle of reasonableness is reflected in section 13 of the Sale of Goods Act 1954 (ACT), which states:
13Ascertainment of price
(1) The price in a contract of sale—
(a)may be fixed by the contract; or
(b)may be left to be fixed in a way agreed by the contract; or
(c)may be determined by the course of dealing between the parties.
(2)If the price is not determined in accordance with subsection (1), the buyer must pay a reasonable price.
The principle of reasonableness is regularly applied. For example, in Baldwin v Jones and Cubit [2000] QBT 30, the Queensland Building Tribunal found there was an oral agreement for performance of building work although there was no stated price. At [310], the Tribunal said:
I note that the Applicant performed the construction of the Respondents' two (2) storey domestic residence for a sum in excess of one hundred thousand dollars ($100,000.00) without committing the agreement to writing however I accept that the works were done in accordance with an oral agreement and consequently there has been no breach of section 58 of the Act. It was the Applicant's evidence that he performed works in accordance with the 1997 plans "in the hope that he would receive payment from the Respondents". Further, the Applicant conceded that at no time did he provide a costing to the Respondents of the works to construct their residence in accordance with the 1997 plans, and the price stipulated in the Contract was for construction of the residence in accordance with the 1993 plans only. In these circumstances, it is necessary to imply as a term to give effect to the parties' oral agreement to require the Respondents to pay to the Applicant remuneration calculated at a reasonable rate for work actually done and the fair market value of goods supplied (per Deane J. in Pavey & Matthews supra at 263). The established principles for the implication of terms are enunciated in Codelfa Construction Pty Ltd -v State Rail Authority (NSW) [1982] HCA 24; (1982) 149 CLR 337.(emphasis added)
By this pathway, I am satisfied that the Tribunal may imply a term that the applicants must pay a reasonable price and then determine whether ACDC charged a reasonable price for the work it performed and the parts it supplied, per the items challenged in paragraph 4 above.
Quantum meruit
If there was not an enforceable contract, it remains clear that ACDC provided parts and labour at the applicants’ request to repair their car in circumstances which make plain there was an implied promise from the applicants to pay ACDC for the parts and labour. ACDC should be appropriately compensated. The applicants do not suggest otherwise.
A claim may therefore be made on a quantum meruit basis to recover (or in this case retain) a reasonable price for those parts and labour: Pavey Matthews; Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337.
In Tickner v The Boat Clinic Pty Ltd (Civil Claims) [2015] VCAT 2062, the Victorian Civil and Administrative Tribunal (VCAT) considered a case where Mr Tickner referred his yacht to The Boat Clinic for repairs without reference to a price. After The Boat Clinic had done the work, it submitted its invoice. Mr Tickner then contended the price was excessive. The VCAT at [19] (footnotes omitted) said:
19 Quantum meruit refers to the body of law under which a person may claim reasonable remuneration for work or services performed, in one of the following situations –
(a)where the parties have a binding contract for the performance of services for payment of a reasonable sum, but where the sum itself is not stated;
(b)unusual situations, such as salvage at sea, which are irrelevant for present purposes; and
(c)where there was an arrangement between the parties which for legal reasons does not amount to a ‘contract’. Sometimes the technical requirements for there to be a contract at law are missing: for example, where the person who performed services and expected to be paid, was unlicensed in the relevant field and prohibited by legislation to contract to perform the services; or where the person receiving the services did not have ‘capacity’ to enter into a contract. But there are also examples where the missing element, which prevents the arrangement from amounting to a ‘contract’, is the express agreement as to payment.
With reference to the proposition at paragraph 19a of its decision, the VCAT referred to Horton v Jones[No2] (1939) SR (NSW) 305, where the Supreme Court of NSW said
if a person employs another to do work… Nothing been said as to wages… The law implies a promise to pay a reasonable wage… and an action may be maintained for quantum meruit
With respect, in my view a claim in quantum meruit does not arise in circumstances where the parties have a binding contract. To the contrary, a claim in quantum meruit is a ‘stand-alone’ claim for restitution based on unjust enrichment.
In Pavey & Matthews at [10], the High Court per Mason Wilson JJ said:
10. Deane J., whose reasons for judgment we have had the advantage of reading, has concluded that an action on a quantum meruit, such as that brought by the appellant, rests, not on implied contract, but on a claim to restitution or one based on unjust enrichment, arising from the respondent's acceptance of the benefits accruing to the respondent from the appellant's performance of the unenforceable oral contract. This conclusion does not accord with the acceptance by Williams, Fullagar and Kitto JJ. in Turner v. Bladin (at p 474) of the views expressed by Lord Denning in his articles in (1925) 41 Law Quarterly Review p 79, and (1939) 55 Law Quarterly Review p 54, basing such a claim in implied contract. These views were a natural reflection of prevailing legal thinking as it had developed to that time. The members of this Court were then unaware that his Lordship had, in his judgment in James v. Thomas H. Kent & Co. Ld. (1951) 1 KB 551, as reported in the authorized reports, discarded his earlier views in favour of the restitution or unjust enrichment theory. Since then the shortcomings of the implied contract theory have been rigorously exposed (see Goff and Jones, The Law of Restitution 2nd ed. (1978) pp.5-11) and the virtues of an approach based on restitution and unjust enrichment, initially advocated by Lord Mansfield and later by Fuller and Perdue (see "The Reliance Interest in Contract Damages" (1936-37) 46 Yale Law Journal 52, 373, esp. at p.387), widely appreciated (Goff and Jones, op cit. at p.15 et seq.; and see Deglman v. Guaranty Trust (1954) 3 DLR 785, at pp 794-795). We are therefore now justified in recognizing, as Deane J. has done, that the true foundation of the right to recover on a quantum meruit does not depend on the existence of an implied contract.
Likewise, in Pavey & Matthews at [7], Brennan J said:
7. An understanding of the principles affecting the right to sue for the recovery of money due under a contract is impeded by an unhappy ambiguity in the use of the terms "implied contract" and "quantum meruit". Sometimes a contract is said to be implied when the contract is an actual, if tacit, agreement made by the parties; sometimes a contract is said to be implied when there is no actual agreement but the law imposes an obligation as though there were a contract between the parties. Even Blackstone did not avoid that ambiguity (Fifoot History and Sources of the Common Law (1949), p.367; Holdsworth History of the English Law, vol.VIII, p.96). Correspondingly, quantum meruit is sometimes used to describe an action to recover a reasonable sum which is due under a contract and sometimes to describe an action to recover a reasonable sum when the obligation to pay it is imposed by law independently of actual contract. As we have seen, indebitatus assumpsit was first expanded to embrace an action of quantum meruit when a contract did not stipulate a fixed sum as the remuneration of the work to be done. Later it was expanded to embrace an action of quantum meruit in quasi-contract when an obligation to pay was imposed by law independently of contract. There is now as there was in the seventeenth century a manifest difference between implying in a contract a term to pay quantum meruit and imposing an obligation to pay quantum meruit independently of contract.
Again, I arrive at ACDC’s entitlement to be paid a reasonable price for the work done. This accords with the decision of Porter J of the Supreme Court of Tasmania in Eagle Sea Pty Ltd V Radford and Dick t/as Radford Cartage Contractor [2012] TASSC 41 at [64] – [68], where his Honour said:
64 In the case of an implied term as to reasonable remuneration, or a claim in restitution based on a quantum meruit, the contractor has an entitlement to recover the fair and reasonable value of the work performed. Although the two types of case often require different considerations because of the existence of a contract in the first and the nature of the remedy in the second, the assessment of this value remains a question of fact to be determined in regard to all of the relevant circumstances. The remuneration will be that calculated at a reasonable work rate for the work done. Alternatively, the value might be assessed by reference to the cost to the contractor, plus a reasonable mark-up for overheads and profit: see generally Pavey & Matthews Pty Ltd v Paul [1987] HCA 5; (1987) 162 CLR 221, per Deane J at 263; Brenner v First Artists' Management Pty Ltd [1993] VicRp 71; [1993] 2 VR 221 at 257 – 259; Sopov v Kane Constructions (No 2) [2009] VSCA 141; (2009) 24 VR 510 at 519 [29] – [30]; Bolot v Capper (1957) 75 WN (NSW) 316 at 317.
65 Most of the discussion in the cases concerning proof of value relates to the situation in which there is a claim based on a quantum meruit, with the defendant raising the issue of negligent workmanship. In such cases it is clear that the plaintiff has to establish that the work was done, that it was done skilfully and without such negligence as renders it worthless, and an entitlement to the amount claimed. It also seems clear that the quality of the work performed is something which needs to be taken into account when assessing value. There is nothing to suggest the same does not apply to a contractual entitlement to reasonable remuneration. In the case of a concluded contract, depending on its type, entitlement may depend on substantial completion.
66 Where some evidence is given that the work was completed with due skill, the burden of adducing evidence may shift, but the burden of proof as to value remains on the plaintiff: Riverside Motors Pty Ltd v Abrahams [1945] VicLawRp 5; [1945] VLR 45 per O'Bryan and Martin JJ (Macfarlan J agreeing) at 53 – 55; Eddy Lau Constructions Pty Ltd v Transdevelopment Enterprise Pty Ltd [2004] NSWSC 273 at [81] – [82]; Pool Data Systems Pty Ltd v Bayliss [2011] NSWSC 224 at [147].
67 I am not able to find any case where the point about reasonable method or means has been specifically addressed. However, acting on first principles, it seems to me that in a case in which the plaintiff is required to prove the value of work done, where the method or way of doing the work was not the subject of specific agreement, that would involve proof that the method adopted or the way in which the work was done was reasonable in terms of cost to the other party.
68 In cases in which the plaintiff is entitled to reasonable remuneration, that remuneration would not be reasonable if it were done by means which are unreasonably time consuming or lengthy, thereby increasing the overall cost. However, as I have indicated, that would only apply where the means of carrying out the work or of achieving the end result is not the subject of agreement. In the absence of anything to do with an agreed method, which would impact on the enforceability of the agreement, then the recipient of the benefit of the work would not be able to raise the issue of reasonableness.
Applying these principles, I turn to the question whether the prices for the items challenged were reasonable. I deal with each in turn.
Determine Cause of Failure
The first item on ACDC’s tax invoice stated “Initial Diagnosis and Basic Tests”. It then stated a quantity of “1.25”, being 1.25 hours, and its hourly charge rate to arrive at a total for this work plus GST.
The applicants dispute the second item on the invoice, namely “Determine Cause of Failure” for two reasons. First they contend that the work was at the instruction of the seller, not the applicants. Secondly, they contend it was “completely unreasonable” that they have paid in substance for this additional time, in addition to the first item, simply “to identify a defective timing belt.”
In respect of the first reason for disputing the second item, I am not persuaded that ACDC proceeded without instruction. Mr Battisson gave evidence to the contrary. It is clear that an important part of the work that the applicants engaged ACDC to do was to assist them in establishing their claim against the seller or its insurer, in the sense of verifying that the breakdown occurred for reasons that would enable them to recover against the seller for breach of warranty. I reject the proposition that ACDC were acting outside authority when ascertaining the cause of the timing belt failure, which was a separate and more labour-intensive task than merely recognising that the timing belt had failed.
In relation to the second reason, I am satisfied that the time spent conducting the diagnostic analysis to ascertain the cause of the timing belt failure was reasonable. It entailed removing the camshafts and doing a compression test, which in turn enabled ACDC to verify that either the timing belt was not fitted correctly (meaning in all probability it had been over tightened) or that it had not been replaced at all contrary to an earlier representation from the seller when it sold the car to the applicants.
In a circumstance where ACDC performed this diagnostic work to assist the applicants in their claim against the seller, which entailed ACDC discussing the results with the seller and with the applicants and assisting the applicants in making their claim, all of which took time for the benefit of the applicants, I am not persuaded that 3.75 hours performing this work was unreasonable. I am satisfied to the contrary.
I note that this diagnostic work entailed time spent that was quite independent of a reasonable estimate of time spent to conduct ordinary repair work, for example the estimates in the Boyce’s Repair Times Guide that record appropriate timeframes within which a competent mechanic should be able to perform specified categories of repair work.
For these reasons, I reject this aspect of the applicants’ claim.
Water Pump and Timing Belt Kit Major
Per the fifth and sixth items on its invoice, respectively, ACDC charged $171.50 for a replacement water pump and $599.38 for a “Timing Belt Kit Major” plus GST. These prices included their margin on the trade costs for purchasing these parts to a total of $770.88.
The applicants contend that these costs were unreasonable. They rely on a quote they obtained from a dealership, referenced to a single part number for ‘genuine parts’, which states:
Coolant pump + timing kit
Comes with water pump and the timing belt kit
The quoted price was $343.54 plus GST, being $377.90.
With reliance on this quote, the applicants submit that the parts on ACDC’s invoice were overpriced. Alternatively, they submit that because the water pump came with the “Timing Belt Kit Major” they should not have been charged additionally for the water pump. The applicants seek a refund that reflects the difference between the quoted amount ($377.90) and $770.88 that they were charged for these parts.
In the hope of verifying ACDC’s claim that the two items on its invoice (the water pump and the Timing Belt Kit Major) reflected two separate purchases from its suppliers, I directed ACDC to provide the supplier’s invoice or invoices. On 23 March 2016, ACDC (through its solicitors) advised the Tribunal that the invoices could not be located. ACDC provided instead two separate quotes both dated 22 March 2016 for:
(a)a timing belt and five other itemised parts referenced to 6 stated part numbers from the same supplier that I assume comprise parts that make up a timing belt kit for a total quoted price of $559.04 inclusive of GST; and
(b)a water pump reference to a stated part number from the same supplier for a quoted price of $181.04 inclusive of GST.
These invoices, ACDC said, evidenced that the two prices itemised in its tax invoice were reasonable.
With reliance on the quote obtained by the applicants, I am satisfied that a ‘timing [belt] kit’, as a separate part or line item available for purchase, contained a collection of genuine parts for the applicants’ car, one of which was a water pump. To buy a ‘kit’ or package of complementary parts for a repair is invariably cheaper than buying each of those parts separately.
I accept that ACDC, after recognising the extent of the damage to the applicants’ car, appropriately and properly purchased a timing belt kit per the item on its invoice “Timing Belt Kit Major”. I accept also, for the reasons discussed below, that the need to replace the water pump arose separately and subsequent to ACDC performing the work necessary to replace the timing belt and to repair the damage caused by the failure of the timing belt. But that does not persuade me that a water pump needed to be bought separately. I acknowledge the possibility that ACDC did so, but ACDC has not provided any evidence that this occurred even though the applicants had put this purchase in issue from the beginning of this case.
I acknowledge that further evidence might establish to the contrary, but on the evidence before me I am satisfied from the quote provided by the applicants that a new water pump, fit for purpose, was or should have been provided with the timing belt kit. That water pump therefore could have been retrieved and used once the further work of replacing the water pump became known.
Accordingly, I am not satisfied that the charge of $171.50 plus GST for the water pump was reasonable. That sum inclusive of GST ($188.65) should be repaid to the applicants.
There remains the difference between the invoiced cost for a “Timing Belt Kit Major” ($599.38) and the quote given to the applicants for a “coolant pump + timing kit” ($343.54) and whether this discrepancy amounts to an unreasonable charge.
I am not persuaded that that conclusion should be drawn. I have no evidence about the component parts that ACDC purchased that made up the “Timing Belt Kit Major”. Also, there is no correlation between the part numbers on the quote given to the applicants and the quotes given to ACDC from the same supplier by which such comparisons could be drawn. It might also be that ACDC were endeavouring to demonstrate on their invoice a difference between the components of an ordinary” timing belt kit” and what it purchased to repair the applicants’ car by adding the word ‘Major’ in their description of the parts. Then there is ACDC’s margin that needs to be added to the trade cost of parts. These several uncertainties prevent me from concluding that ACDC’s invoiced price for the Timing Belt Kit Major was unreasonable.
For these reasons, save for the costs of the water pump, I reject this aspect of the applicants’ claim.
Replace water pump
The applicants acknowledge that the standard labour time for replacement of a water pump is five hours. ACDC invoiced the applicants 4.75 hours for this work. The applicants’ complaint is not that the work needed to be done, but that it should have been done as part of a further labour item “R&R Cylinder Head including Stripped Cam Bolts” for which they were separately charged $2,437.72.
There is no dispute that it would have been more cost-efficient to replace the water pump at the time when the engine was stripped down to replace the timing belt and refit the cylinder head.
In broad terms, ACDC accept that the additional time to replace the water pump, if it had been done during the rebuild, would have added perhaps an additional hour of labour, rather than the 4.75 hours that were subsequently spent. ACDC submit, however, that at the time it performed the rebuild it had no knowledge that the water pump was defective and had received an assurance from the seller that it had recently replaced. Also, ACDC note that it was not possible to test the water pump until the engine had been rebuilt and pressurised. Only then could the leak have been discovered, at which point ACDC discussed the matter with the applicants who asked ACDC to repair it. That required significant disassembling of the engine to access the defective water pump.
The applicants contend that it was not reasonable for ACDC to have gone about the repairs in this way. They submit that in circumstances where the seller had given ACDC (and the applicants) an assurance that the timing belt had been replaced and where ACDC realised that in all probability it had not, ACDC should have appreciated the risk that the water pump too had not been replaced and therefore replaced it when it was convenient and cost efficient to do so.
For several reasons, I reject that submission.
First, ACDC had no basis for understanding the water pump was defective. I do not accept that a repairer should replace parts, and then invoice a client for the cost of doing so, when it has no basis for knowing that a part is defective. This is also consistent with the applicants’ earlier position in its correspondence to a consulting automotive engineer, Mr Paul Johnson, where they acknowledged that ACDC had not been engaged to replace the water pump and that the water pump’s failing only became known after ACDC conducted a pressure test.
Secondly, I reject the proposition that a mere concern (assuming ACDC had the concern) that a part might not have been replaced, contrary to an assurance that it had been, is a sufficient basis to replace a part. It was certainly not ‘unreasonable’ for ACDC not to have replaced the water pump until after the defect became known.
Thirdly, the submission is contrary to the applicants’ earlier position to the seller’s insurer when it sought to recover the costs of replacing the water pump from the seller on the basis that ACDC could not reasonably have known about the defective pump until after the system was pressure tested such that the insurer should cover the labour cost of these repairs as a ‘stand alone’ repair.
Where there is no dispute that the time spent to replace the water pump as a stand-alone cost was reasonable, I reject this component of the applicants’ claim.
Cylinder Head Overhaul
The applicants challenge the item entitled “Cylinder Head Overhaul” for $959.45 on the grounds that ACDC never provided an invoice for this subcontracted work that was referred to a specialist repairer. They also rely on a quote from an independent repairer for “cylinder head rebuild labour” that contains an entry entitled “service sundries - strip and rebuild cylinder head with supply parts” for $590.91 to contend that ACDC’s charge for the cylinder head overhaul was unreasonable. They seek a refund of the difference – $368.54.
For several reasons, I reject this aspect of the applicants’ claim.
First, I accept that a person carrying on a business (and ACDC in this case) would not ordinarily be required to disclose its own costs to a client especially its costs incurred for work contracted to third parties. That is particularly so where a quoted price to a client has been offered and accepted.
However, in this case where price was not agreed or quoted in advance of ACDC performing the work and where the applicants challenge the reasonableness of the charge for the cylinder head overhaul, ACDC provided the tribunal with a copy of the invoice for this work that it received from its subcontractor. That invoice contains charges for parts and labour for the overhaul of the cylinder head. The invoice also demonstrates that ACDC attached a relatively small margin to the trade cost it paid to the subcontractor when invoicing the applicants for this work.
Secondly, I am not persuaded that the work done and parts provided by the subcontractor, per its invoice to ACDC, is the same or materially the same as the work reflected in the line item in the quote from the independent repairer provided to the applicants. That quote is for labour only. The invoice from ACDC’s subcontractor included costs for exhaust valves and inlet valves that are significantly less than the quoted costs for these parts in the quote from the independent repairer. When the quoted cost for these parts is added to its labour cost for stripping and rebuilding the cylinder head, the quote from the independent repairer exceeds the line item charged by ACDC to the applicants for the cylinder head overhaul.
Thirdly, it is difficult to distinguish the work ACDC invoiced for the cylinder head overhaul from the work it invoiced for the cylinder head removal and refit that included the repair of the stripped cam bolts. However, the total sum charged for that work was $3,397.16. When compared to the independent repairer’s quoted total cost for a cylinder head rebuild (parts and labour) of $3,273.63, which does not include any allowance for repairing the stripped cam bolts, there is no appreciable difference between the two prices.
R&R Cyl Head incl Stripped Cam Bolts
ACDC invoiced the applicants for 14.75 hours of labour for removing and refitting the cylinder head. This included time spent removing and replacing stripped cam bolts, which I understand to mean the 24 TORX screws that are used to retain the camshaft caps. This time was in addition to the time spent by the subcontractor in overhauling the cylinder head for which they paid $959.45.
The applicants contend that the charge of 14.75 hours was excessive in circumstances where the repair times guide published by Boyce’s Automotive Data provides for 14.5 hours for overhauling the cylinder head in a car that is the same model as the applicants’ car. The applicants contended that 10 hours would be reasonable when allowance is made for the work done by the subcontractor.
ACDC submit that the Boyce’s Guide is no more than a guide of an approximate time that a competent tradesmen needs to perform specified work where work is required consequent upon wear and tear.
Mr Battisson gave evidence that the Boyce’s Guide is therefore not applicable in this case. He noted that the work was necessary not because the cylinder head was worn out through use but because of catastrophic damage caused by the failure of the timing belt. This damage, he said, had caused further damage, particularly to the TORX screws that had ‘rounded out’. Removal of the screws took further time than would ordinarily not have been necessary in order to remove the camshafts and the cylinder head. This further work (and time), he said, was reflected in the invoiced item.
I accept Mr Battisson’s evidence. The Boyce’s Guide commences with a statement under the heading “Recommended Repair Times”:
The repair times as manual are estimated flap repair times.
...
No allowance has been made to include the use of special tools, the freeing up of seized or rusty parts, the removal of broken studs and the removal of accessories and non-standard fitments
In circumstances where, even on the applicants’ case, 10 hours was reasonable for the removal and refit of the cylinder head as a standard repair, I am satisfied that the additional 4.75 hours was reasonable, having regard to the need to carry out additional work consequent upon catastrophic damage to the cylinder head.
The applicants also rely on an allocation of 7.7 hours labour in a quote from the independent repairer for rebuilding the cylinder head to contend that the charge for 14.75 hours of labour was unreasonable. They contend that even if a further 2.3 hours were added to allow for the partial stripping (which I assume to mean stripping of the bolts) it still amounts to only 10 hours of labour, rather than 14.75 hours that ACDC charged for this work.
I am not persuaded that the comparison can be made. The independent repairer’s quoted time for proposed work was a business decision for it. It was also a quote given for a hypothetical repair to a vehicle type in the absence of any catastrophic damage. It might well be that if the applicants’ car had been presented for actual repair significant further time would have been quoted to address the damage resulting from the catastrophic failure of the engine. I also note that the independent repairer’s quote for some parts is significantly greater than the cost of the comparable parts that form part of the subcontractor’s invoice sent to ACDC for the overhaul of the cylinder head. These variables cause me to conclude it would be speculation for to me to comment on how the independent repairer’s quote was assembled, which in turn dissuades me from concluding that a comparison between it and ACDC’s invoice is a proper basis for concluding that ACDC’s invoice for this work was unreasonable.
For these reasons, I reject this aspect of the applicants’ claim.
Petrol
The applicants submit that it was unreasonable for ACDC to invoice them $15 for petrol. It does seem somewhat ungracious that ACDC invoiced the applicants for this cost, having regard to the total cost of the repair, but I am not persuaded that it was unreasonable for them to do so. Petrol is necessarily used after conducting most repairs to a vehicle in order to road test the vehicle after carrying out the repairs. Invariably petrol is already in the car, purchased by the owner, and so is not reflected on a resulting invoice.
In this case, Mr Battisson gave evidence that ACDC placed $15 worth of petrol in the car. The applicants contend that the car was provided with a third of a tank and returned to them with an empty fuel tank. I did not receive evidence as to the nature or extent of the road testing that was done after the repairs completed, but I am not persuaded that the car was driven and petrol used otherwise than for the purpose of road testing the vehicle to ensure that it was being returned to the applicants with the repairs conducted to a competent standard.
For these reasons, reject this aspect of the applicants’ claim.
Orders
For these reasons, the tribunal’s orders are as follows:
1.The respondent pay the applicants $188.65.
2.The application is otherwise dismissed.
………………………………..
President G McCarthy
HEARING DETAILS
FILE NUMBER: | XD 15/1230 |
PARTIES, APPLICANTS: | Rajesh Chetty and Kate Chetty |
PARTIES, RESPONDENT: | Automotive Computer Diagnostic Centre (ACDC) Pty Ltd |
COUNSEL FOR THE APPLICANT | N/A |
COUNSEL FOR THE RESPONDENT | J Klarica |
SOLICITORS FOR APPLICANT | N/A |
SOLICITORS FOR RESPONDENT | Solon Lawyers |
TRIBUNAL MEMBERS: | President G McCarthy |
DATE OF HEARING: | 2 March 2016 |
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