Collum v Opie
[2000] SASC 107
•7 July 2000
COLLUM v OPIE
[2000] SASC 107Full Court: Lander, Williams and Gray JJ
1 LANDER J. I have had the advantage of reading in draft the reasons for decision of Gray J. I agree with his Honour’s conclusions and desire to add only a few words.
2 The appellant, who was the defendant in the Court below, was found liable to the plaintiffs for misrepresentations made by her husband/agent and thereby for breach of contract.
3 In particular the Trial Judge found that the defendant was in breach of contract for failing to obtain approval from the plaintiffs for the variation of a proposed development on the defendant’s property.
4 The Trial Judge adjourned the plaintiff’s claim for damages for further consideration but in the meantime made orders in the nature of injunctions requiring the defendant to remove a wall which had been constructed on the boundary between the defendant’s land and the plaintiff’s land to a height of 3.8m and restraining the defendant or her agents from constructing part of a proposed building at the Eastern end of the defendant’s land.
5 The defendant does not complain, on appeal, of the finding that she was liable to the plaintiffs for breach of contract. Nor does she complain of the determination that she is liable in damages for breach of contract or the order adjourning the assessment of damages.
6 She does not dispute that in the circumstances of this case it was appropriate to grant some form of injunction and indeed does not complain about that part of the injunction which prevents her from erecting the two storey section on the Eastern end of her premises.
7 She limits her complaint on this appeal to that part of the order which requires her to remove the Southern wall to the height of 3.8 metres.
8 The defendant claims that that order should not have been made because of the plaintiffs’ delay in enforcing their rights against the defendant.
9 The contract provided that, if the defendant constructed the proposed development referred to in the contract, which was to be a two storey dwelling on the defendant’s land, the defendant agreed that the aspect and position of the Southern side of the proposed development would not vary significantly from those depicted in the house plan as provided to the plaintiffs “unless the (defendant) first obtains the (plaintiffs) approval for such variations and the (plaintiffs) must not withhold such approval unless the (plaintiffs) reasonably determines (sic) that the variation affects the (plaintiffs) enjoyment of the land”.
10 The Trial Judge determined that the defendant decided to construct the proposed development otherwise than in accordance with the plan provided to the plaintiffs and carried out a partial construction of the development otherwise than in accordance with that plan.
11 When the plaintiffs became aware that the Southern aspect was to be higher than provided for in the plan they sought and obtained legal advice and gave notice to the defendant objecting to the development. The notice which was given on 5 May required the defendant to confirm that:
1.She would only construct a wall along the relevant boundary which conforms to the wall depicted in the plan;
2.She would immediately remove or cause the builder or its sub-contractors to remove that portion of the wall which exceeds the height depicted in the plan and;
3.She would not make any further variations of the aspect or position of the Southern side of the development other than after strict compliance with Special Condition 5.3.
12 It was the defendant’s case at trial that the plaintiffs were on notice from early March that the defendant proposed to depart from her contractual obligation; that the plaintiffs were aware when the walls were topped that there had been the departure from the defendant’s contractual obligation; and that therefore the plaintiffs had been guilty of unwarranted delay.
13 The Trial Judge specifically rejected as a matter of fact any delay on the part of the plaintiffs and specifically accepted the evidence of the male plaintiff as to the events between March 1999 and 5 May 1999.
14 In my opinion the defendant did not establish that the plaintiffs had been guilty of any delay let alone delay of a kind which would have disentitled the plaintiffs to the order made by the Trial Judge. As Gray J has pointed out the defendant was on notice from 5 May 1999 of the plaintiffs’ contention that the defendant was in breach of contract and the defendant continued with the building work notwithstanding that notice.
15 Put shortly the plaintiffs did not, by their inaction, place the defendant in a situation in which it would be inequitable and unreasonable for her to be placed if the remedy was granted; Orr v Ford (1989) 167 CLR 316 at 341.
16 Indeed the defendant’s predicament is of her own making.
17 It should be observed that the Trial Judge was careful to fashion remedies which caused the minimum cost and disruption to the defendant whilst at the same time preserving the plaintiffs’ rights. He was well aware that the order which is complained of, which is of course mandatory in nature, would put the defendant to expense and prevent the defendant building that which she would wish to build.
18 However I agree, with respect, with the Trial Judge that such an order was necessary to do justice between the parties.
19 I agree with the reasons of Gray J and I agree that the appeal should be dismissed.
1
20 WILLIAMS J I agree that the appeal should be dismissed. I agree with the reasons given by Lander J and Gray J.
21 GRAY J On 9 June 1998 a contract in writing for the sale and purchase of property was entered into between the defendant Ms Collum (the appellant) as vendor and Mr Opie and/or nominee as purchaser. Settlement occurred on 23 November 1998 and the property was transferred to the plaintiffs Mr Opie and his wife, (the respondents).
22 The property was a substantial two-storey house located at 157 East Terrace Adelaide. There was a tennis court immediately adjacent to its north which was retained by the vendor for the building of a new home. The consideration payable was $630,000. The contract was subject to a number of special conditions including special condition 5 which provided:-
"(5).5.1 The Purchaser acknowledges that it is the Vendor's intention to construct a two-storey dwelling ("the proposed development") on the balance of land in Certificate of Title Volume 5465 Folio 145 ("the balance of the land") and that the Vendor has provided to the Purchaser a plan of the proposed development ("the house plan").
5.2Subject to sub-clause 5.3, the Purchaser agrees to give any consents which may be required for the Vendor to proceed with the proposed development and agrees to make no objection to the proposed development or any change to the house plan.
5.3The Vendor agrees that the aspect and position of the southern side of the proposed development must not vary significantly from those depicted in the house plan as provided to the Purchaser (and, in particular, that no additional windows may be placed in the southern wall of the proposed development) unless the Vendor first obtains the Purchaser's approval for such variation and the Purchaser must not withhold such approval unless the Purchaser reasonably determines that the variation affects the Purchaser's enjoyment of the land.
5.4The Vendor agrees to consult and agree with the Purchaser in relation to:-
(i)the external finish of that portion of the southern wall of the proposed development which is located on the boundary between the Land and .... the balance of the land; and
(ii)the dividing fence between the Land and the balance of the land and to meet the cost of both."
23 Paragraph 5.1 refers to "a plan of the proposed development (the house plan)." There was considerable dispute at trial as to the identification of the house plan and the learned trial Judge resolved the issue by concluding that "the coloured plans are the house plan for the purposes of clause 5.1 - 5.4 of the contract". The coloured plans had been handed to the plaintiffs on 7 April 1998 and relevantly depicted the southern wall at a height of 3.8 metres.
24 The defendant is a solicitor and her husband Mr Cheney a builder. Mr Cheney had been involved in the design and construction of new homes specialising in reproduction period styles for many years. He had purchased the property at 157 East Terrace on behalf of the defendant. They intended to resell the house and to build a substantial two storey residence on the tennis court block.
25 Mr Opie had dealt with both the defendant and Mr Cheney in business for a number of years. He was familiar with the types of development undertaken by Mr Cheney. Mr Opie was aware of the purchase by the defendant of the property and of her desire to build on the tennis court block and was anxious to buy the house property. Accordingly he approached Mr Cheney and negotiations occurred leading to the contract for sale. Mr Cheney represented Ms Collum in the negotiations and acted at all relevant times as her agent. Ms Collum’s affidavit forming part of her evidence-in-chief established that she and Mr Cheney were joint venturers as husband and wife in the development. I instance the following examples:-
"My husband David Cheney advised me that an acquaintance of ours Mr Opie wanted to know if we were interested in selling the house property."
"I told him [Mr Cheney] to make absolutely sure Mr Opie knew what we were proposing to build on the tennis court after all the problems which we had had with obtaining planning approval I wanted to ensure that we did not introduce a neighbour who might raise objections to the proposed development."
"Mr Cheney advised me that Mr Opie knew exactly what we proposed to build on the tennis court."
"I expressed to Mr Cheney my concern that we retain complete flexibility as the result of the sale of a house property."
"I asked Mr Opie if he was happy with what we were proposing to build on the tennis court."
"And at that time I was concerned to ensure that we would be able to change any part of the development."
As His Honour said:-
" Ms Collum accepted that in the management of the process of the construction of the building she has, essentially, left everything to Mr Cheney. She was present in court when her counsel made a statement that, in effect, Mr Cheney should be treated as a de facto defendant in these proceedings. During cross-examination Ms Collum also accepted that general description in the sense that he had authority to act on her behalf in the things he said or did in connection with the development. The defendant did not dispute the plaintiffs’ contention that she was bound by the conduct of Mr Cheney. I am satisfied that the defendant authorised Mr Cheney to act on her behalf in all the dealings and negotiations with the plaintiffs and she is bound by his conduct in that regard: see Colonial Mutual Life Assurance Society Limited v The Producers and Citizens Co-operative Assurance Company of Australia Limited (1931) 46 CLR 41 per Dixon J at 49-50." [159]
As a result of these findings His honour concluded:-
" There is no evidence to suggest that Ms Collum was aware of Mr Cheney's misleading conduct, but she is bound by what Mr Cheney did and said in the course of his dealings with the plaintiffs. The defendant did not dispute that she was bound by Mr Cheney's conduct." [179]
26 These finding were well justified by the evidence. I will return to these findings later when addressing the defence of laches.
27 There was considerable dispute at trial as to the dealings between the plaintiffs and Mr Cheney. There were also disputes concerning the consequential effects on the development of possible injunctive relief. The learned trial Judge preferred the evidence of the plaintiffs and Mr Hillen to that of Mr Cheney. His Honour rejected the evidence of Mr Cheney, finding that he gave deliberately false evidence.
28 Examples of His Honour's unchallenged findings include:-
" The explanation by Mr Cheney was, to say the least, unconvincing. He gave the appearance of plausibility, but I reject his explanation. I have reached the clear view that Mr Cheney sought to bolster his version that he showed the development plans to Mr Opie during the first meeting. He gave deliberately false evidence either knowing that he had marked the plan on another occasion or in the knowledge that he was unable to recall the occasion on which he had marked the plan. [132]
"For the purposes of these proceedings, Mr Cheney has been anxious to convey the impression that the coloured plans were worthy of little attention and that he was unlikely to have invited Mr Opie to rely upon them. He deliberately attempted to avoid fully informing the court of the use made of those plans with the original application because he perceived it might convey an impression of the importance he placed upon the plans that had the capacity to support the evidence of Mr Opie. [141]
"I am satisfied that Mr Cheney intended the neighbours to rely upon the coloured plans as giving a clear and accurate impression of the dimensions of the proposed development. In addition, as part of his appeal process, he provided the coloured plans to expert architects and planners in seeking their support for his application for approval. In particular, he requested a planner to address issues he knew were relevant to the Council such as density, height, proportions and overall scale of the proposal. Mr Cheney intended that the architects and planners rely on the coloured plans for those purposes." [142]
" I find that Mr Cheney represented the height of the southern wall would be about the height of the pergola and of the brickwork over the windows in the western wall of the existing premises which he said was about the height of the pergola. In conjunction with those representations, I am satisfied that Mr Cheney presented the coloured plans to Mr Opie with the intention that Mr Opie should rely upon those plans, together with his representations, in determining the dimensions of the proposed development, including the height of the southern wall and the overall height of the development. The plaintiffs relied upon the coloured plans and the representations, including the misrepresentations, made by Mr Cheney in arriving at a decision to purchase the premises. [181]
"As previously discussed, in the course of the development application Mr Cheney used the coloured plans in circumstances demonstrating an intention that others rely upon the plans in order to determine the overall dimensions and other features of the proposed development. Mr Cheney provided the coloured plans to Mr Opie with the intention that Mr Opie rely upon them in the same way. Mr Cheney's conduct in this regard demonstrates a belief on the part of Mr Cheney that the plans could be relied upon for those purposes." [241]
"Where the evidence of the plaintiffs conflicts with that of Mr Cheney, I prefer the evidence of the plaintiffs. I am satisfied that Mr Cheney has deliberately sought to mislead the court on important issues in order to avoid the consequences of his representations and the contract." [176]
29 In the course of negotiations leading to the contract there was considerable discussion about the proposed development. As I have already observed, the coloured plans were produced to the plaintiffs by Mr Cheney and they later became the house plans referred to in cl 5.3 of the contract. It transpired that other plans ('the development plans') had been prepared by Mr Cheney and submitted to Council for approval. The development plans were not shown to the plaintiffs and were materially different to the coloured plans. Relevantly to this appeal, the development plans depicted a significantly higher southern wall.
30 Through the latter months of 1998 a number of issues arose between the plaintiffs and the defendant and Mr Cheney concerning the building works. They included a major issue with respect to the proximity of the new building to the existing house of the plaintiffs. Those matters were addressed. However by this time the parties had engaged solicitors and relations were strained.
31 By early March 1999 building work at the western end of the property was under way. The progress of that work indicated to the plaintiffs that the southern wall was going to be higher than they believed it should be. By mid-April 1999 the southern wall was erected and was to the plaintiffs' observation substantially higher than they had understood had been agreed. The height shown on the coloured plans was 3.8 metres, but the southern wall was constructed to a height of some 5.2 metres.
32 On 27 April 1999 the plaintiffs sought further legal advice and their solicitors wrote to the Council to obtain a copy of the relevant plans. On 5 May 1999 their solicitors wrote to the defendant complaining about the height of the southern wall, asserting that there had been a breach of contract, requesting that it be reduced in height to accord with the agreed plans and threatening legal proceedings. In response the defendant asserted that the southern wall was built according to the agreed plan, and continued with the building works. On 20 May 1999 the slab forming the roof of the garage and the floor of a first storey at the western end was poured. On 9 July 1999 proceedings were issued, undertakings to hold the status quo were given, and an expedited trial was ordered.
33 The construction of the southern wall at a height in excess of 3.8 metres without first obtaining the approval of the plaintiffs was found by the learned trial judge to be in breach of contract. This finding was not challenged on appeal.
34 Had the matter been addressed in May when requested, the height of the southern wall could have been reduced from 5.2 metres, as built, to 3.8 metres, by removing some courses of brick and other minor works. Additionally as a consequence there would need to be a lowering of the planned height of ceilings in the middle section of the development. The learned trial judge accepted evidence of an expert Mr Hillen, that a practical resolution could be found which would result in higher than usual ceilings and a construction that would be overall in proportion and aesthetically attractive.
35 The defendant did not address the matter in May. She continued the building works despite the demand. By the time of trial the first floor slab forming the garage ceiling had been poured. As a result at trial the defendant contended that an injunction would cause great hardship because of the need to remove the southern half of the slab.
36 It was accepted on appeal that the cost involved in the removal of the entire slab and other remedial work would be more than $50,000 but less than $100,000. There was no challenge to the finding of the learned trial Judge that only the southern half of the slab needed to be removed and thus the costs would be significantly less. Detailed evidence of the costings was not given. The learned trial Judge concluded that substantial hardship in a number of respects would be caused to the defendant if the injunction were granted. However His Honour was of the view that the defendant through Mr Cheney had knowingly taken the risk of building the garage slab.
37 On the other hand the learned trial Judge found that the increased height of the southern wall had a substantial detrimental effect on the plaintiffs' property and their enjoyment of it. His Honour said:-
" I am satisfied that, viewed objectively from the plaintiffs' premises, the increases in height of the southern wall above 3.8 metres amount to significant variations to the aspect of the southern side of the development. Viewed objectively, in my opinion the impact upon the amenity of the plaintiffs' property is substantial. I find that the plaintiffs have reasonably determined that the variation affects their enjoyment of the land. I find that in constructing the southern wall at the various heights in excess of 3.8 metres without first obtaining the approval of the plaintiffs, the defendant was in breach of cl 5.3.". [246]
38 Another aspect of the matter related to the height of the eastern two-storey section of the proposed building. In this regard His Honour concluded:-
" I am satisfied, however, that if the proposed development was to exceed 11.75 metres, the addition to the height over the 9.6 metres depicted in the coloured plans would have reached the point where it becomes a significant variation to the aspect." [251]
39 His Honour determined that he would grant a mandatory injunction and on 20 October 1999 ordered:-
"1..... That the defendant is commanded within 28 days of service of this Order on her to remove or cause to be removed so much of the southern wall of the building being constructed ("the Development") on the land comprised in Certificate of Title Register Book Volume 5622 Folio 680 ("the Defendant's Land) which is constructed on the boundary between and which is greater than 3.8 metres in height above "Grade line "X" as depicted in the survey the Defendant's Land and the land comprised in Certificate of Title Register Book Volume 5622 Folio 681 ("the Plaintiffs' Land") and which is greater than 3.8 metres in height above "Grade line "X"" as depicted in the survey plan prepared by Bruce Allan Hewett and dated 22 July 1999 (a copy of which is annexed) except for that portion of the southern wall between the points marked "A" and "B" on the said plan.
2.That the defendant be restrained and an injunction is hereby granted restraining the defendant by herself or by her servants, agents, or employees from constructing the two storey section at the eastern end of the Development ("the Eastern Section") beyond the height at which the north/south ridge line of the roof of the Eastern Section (being the ridge line between the two towers on the roof of the Eastern Section) is equal to the height of the north/south ridge line of the roof of the house erected on the Plaintiffs' Land."
40 Order 1 is challenged by way of appeal. The defendant does not challenge Order 2.
41 His Honour made further orders on 30 November 1999 as to costs including the following:-
"3..... The Defendant pay 95% of the Plaintiff's costs of the action on a party/party basis to be agreed or taxed.
6.The Defendant pay to the Plaintiffs the cost of the hearing at which Mr Bruce Allan Hewett gave evidence, which costs include the costs of attendance and submissions on that occasion.
7...... There be no order as to costs in respect of the balance of the arguments about the form of the orders made pursuant to the judgment delivered on 13 September 1999".
42 The Notice of Appeal makes complaint in respect of these paragraphs but on the hearing of the appeal no submissions were advanced in support of these grounds. The Court was informed that, as Mr Cheney was a non party affected by the costs order, these grounds would be the subject of a separate appeal.
43 As His Honour observed, the obligation imposed by clause 5.3 was for the defendant not to vary significantly the aspect and position of the southern side of the development from the aspect and position depicted in the coloured plan without first obtaining the approval of the plaintiffs. His Honour found there to be a breach of clause 5.3. In issue therefore was the enforcement of a negative covenant.
44 The contract of sale and purchase was executed. As an executed contract there was no further requirement for the execution of any instrument or the undertaking of any act for the purposes of placing the parties in the position contemplated. The contract did all of that. By virtue of the contract itself, the plaintiffs had the rights provided by Clause 5.3 and the defendant was obliged to respect the negative stipulations of clause 5.3. The learned trial Judge granted injunctive relief to ensure that the defendant performed and respected the covenants contained in clause 5.3.
45 There has been considerable debate about the distinction between orders for specific performance and orders in the nature of injunctions. The High Court of Australia in J.C. Williamson Ltd v Lukey & Mulholland[1]and in Packenham Upper Fruit Co Ltd v Crosby[2] recognised that in the case of an executed contract, specific performance was not the appropriate form of relief. Rather, relief analogous to specific performance, namely injunctive relief should be sought.
[1] (1931) 45 CLR at 282
[2] (1924) 35 CLR at 386
46 As the learned trial Judge noted in his judgment, the distinction may not be of particular importance in this case. Neither party challenged His Honour's view that if relief was to be granted to enforce cl 5.3 then the appropriate relief would be injunctive relief. As a result the matter does not need to be further discussed.
47 His Honour granted injunctive relief. In part that relief was mandatory, as His Honour ordered portion of the southern wall to be removed. In part it was prohibitory, as orders were made requiring the appellant to comply with the negative stipulations of clause 5.3. His Honour's prohibitory injunctive orders also dealt with other aspects of the building works, but as I have observed earlier those matters are not the subject of appeal.
48 Before coming to discuss the defendant's primary contentions in regard to her defence of laches it is convenient first to address a subsidiary matter. As earlier noted the learned trial Judge found that there was no evidence to suggest that the defendant was aware of Mr Cheney's misleading conduct. However His Honour noted that it was accepted by the defendant that she was bound by Mr Cheney's conduct. His Honour concluded that the defendant was bound by what Mr Cheney did and said in the course of his dealings with the plaintiff:-
49 Counsel submitted that as the defendant was unaware of the deception being practised by Mr Cheney, the Court in equity could only consider her conduct on the basis of what she actually knew as the contracting party. Counsel submitted that the conduct of Mr Cheney and his knowledge were not relevant matters for consideration. I reject those submissions.
50 In equity the Court will consider all the circumstances including the relationship between the defendant and Mr Cheney as well as the conduct and knowledge of Mr Cheney. The general approach of the law as to imputation of knowledge of agent to principal supports this conclusion. It has long been settled that any actual or constructive notice which an agent has will normally be imputed to the principal[3] and as Meagher, Gummow and Lehane Equity Doctrines and Remedies (3rd edition) paragraph 853 at 252 comment:-
"Imputed notice is notice which an agent has either received or should have received had he made proper inquiries, whether the notice is communicated by him to his principal or not. In such circumstances his principal is said to have imputed notice of the fact or thing which is known or ought to be known by the agent."
It was laid down in Wyllie v Pollen 1863 3 De G J and Sm 596, that a person who employs an agent in a transaction is presumed by law to have had brought to his notice all information which his agent has acquired or to have acquired and the course of the transaction and relevant to it. Normally, this presumption cannot be rebutted."
[3] Snell's Principles of Equity 27th edition page 54
51 In my opinion it was appropriate for the learned trial Judge to consider Mr Cheney's conduct as relevant to injunctive relief. Mr Cheney's knowledge should be imputed to the defendant.
52 Counsel limited his attack to His Honour's finding that:-
"From early May 1999 the plaintiffs made clear their objections to the height of the wall. In all the circumstances, I find that the delay from early May to the issuing of proceedings in early July was not unreasonable. In the knowledge that the plaintiffs were threatening legal proceedings and maintaining the southern wall should be reduced in height to the height shown in the coloured plans, and in the knowledge that the wall was built higher than depicted in the coloured plans, the defendant through Mr Cheney knowingly took the risk of building the garage slab which Mr Cheney knew was constructurally linked to the southern wall. In these circumstances, this is not a case in which the plaintiffs should fail because of the hardship to the defendant brought about by the plaintiffs’ inaction." [329]
53 I see no error in the reasoning and conclusions of the learned trial Judge. In my opinion they are correct. It was the defendant who received and dealt with the letter of demand on 5 May 1999, and it can be safely inferred that she was personally aware of the structural links between the southern wall and both the garage slab and the middle section of the development.
54 The doctrine of laches is governed by the fundamental maxim of equity: equity aids the vigilant, and not those who sleep on their rights. (Vigilantibus et non dormientibus aesquitas succurit). The general rule governing laches is as set out in Lindsay Petroleum Company v Hurd [4].
" ‘The doctrine of laches in Courts of Equity is not an arbitrary or a technical doctrine. Where it would be practically unjust to give a remedy, either because the party has, by his conduct, done that which might fairly be regarded as equivalent to a waiver of it, or where, by his conduct and neglect he has, though perhaps not waiving that remedy, yet put the other party in a situation in which it would not be reasonable to place him if the remedy were to be asserted, in either of these cases, lapse of time and delay are most material. But in every case, if an argument against relief, which otherwise would be just, is founded upon mere delay, that delay of course not amounting to a bar by any statute of limitations, the validity of that defence must be tried upon principles substantially equitable. Two circumstances, always important in such cases, are, the length of the delay and the nature of the acts done during the interval, which might affect either party and cause a balance of injustice or injustice in taking the one course of the other, so far as relates to the remedy.’
[4] 1874 5PC 221 at 239-240
55 Lord Blackburn quoted that passage with approval in Erlanger v. New Sombrero Phosphate company[5] and he went on:-
"I have looked in vain for any authority which gives a more distinct and definite rule than this; and I think, from the nature of the inquiry, it must always be a question of more or less, depending on the degree of diligence which might reasonably be required, and the degree of change which has occurred, whether the balance of justice or injustice is in favour of granting the remedy or withholding it. The determination of such a question must largely depend on the turn of mind of those who have to decide, and must therefore be subject to uncertainty; but that, I think, is inherent in the nature of the inquiry.’"
[5] (1878) 3 App. Cas. 1218, at pp 1279-1280
56 These much approved principles[6] were applied by Deane J in Orr v Ford[7] when he said:-
"The ultimate test effectively remains that enunciated by Lord Selbourne L.C. in Lindsay Petroleum Company v Hurd namely whether the plaintiff has, by his inaction and standing by, placed the defendant or a third party in a situation in which would be inequitable and unreasonable to place him if the remedy were afterwards to be asserted."
[6] Turner v General Motors (Australia) Pty Ltd (1929) 42 CLR 352 per Dixon J at 369-370; Fysh v Page 96 (1956) CLR 233 per Dixon CJ, Webb & Kitto JJ at 243-4; O'Brien v Australian and New Zealand Bank limited (1973) 5 SASR 347 per Zelling J at 358-9.
[7] (1988-1989) 167 CLR 316 at 341
57 It cannot be doubted that any person who knows of their rights and stands by and does nothing to assert them generally will not receive the assistance of equity. The old cases on laches are ones where many years had elapsed before action was brought. It is relevant to note in this respect that at most there is only a period of some eight weeks between the plaintiffs first being on notice of the problems and the raising of complaint and then a further period of some eight weeks between notice and issue of proceedings.
58 The plaintiffs' conduct has also to be considered in the light of the findings of deception[8] referred to earlier.
[8] Roberts v Tunstall (1845) 4 Hare 257; Fysh v Page (1956) 96 CLR 233 at 243
59 The learned trial judge found that the deception practised by the defendant's agent Mr Cheney upon the plaintiffs was intentional and was maintained. For reasons previously expressed the defendant cannot dissociate herself from the conduct of Mr Cheney. The defendant's conduct on receiving the letter of demand of 5 May evinced a determination to proceed without regard to the plaintiffs' rights. The defendant cannot in my opinion say that she was misled by the plaintiffs into embarking on any particular course of conduct or activity.
60 The plaintiffs had been deceived by Mr Cheney. The deception included the inducement of the plaintiff into believing that the coloured plans were the contract plans and the development would accord with those plans. However Mr Cheney intended to build in accordance with other plans materially different, those differences including the height of the southern wall.
61 The plaintiff became aware of the deception over time in circumstances where they had been conditioned by Mr Cheney into believing that their concerns were occasioned by their own misunderstandings or fault.
62 When in March 1999 the plaintiffs first became aware that the southern wall was likely to be higher than they thought, the deception of Mr Cheney was in part uncovered. Obtaining of legal advice and then consequent to that advice obtaining the plans lodged with the Council were prudent steps to take. They were entitled to take advice, consider their position and then act. They did so and they acted by the letter of 5 May 1999 making demand. In my opinion this was reasonable.
63 The extent of the deception practised on them did not fully reveal itself until the trial was well under way. They then learnt that Mr Cheney was building the development in accordance with yet another set of plans that had not been disclosed to them.
64 The southern wall was erected by the defendant in breach of contract and in circumstances of the plaintiffs being unaware of the full extent of the deception being practised upon them. There was no acquiescence by the plaintiffs. To the contrary there was a prompt and appropriate demand made on 5 May 1999. The plaintiffs acted reasonably to protect their rights.
65 The defendant's contention in regard to laches, is that the plaintiffs by their inaction in standing by placed the defendant in a situation where she undertook substantial work. They contended that it would require considerable cost for that work to be undone and would necessitate some redesign and that in the circumstances it was inequitable and unreasonable to place her in such a position.
66 When it is understood that the defendant was on notice from 5 May of the plaintiffs' complaint and elected to proceed to pour the garage slab knowing of the plaintiffs' demands, her complaints of hardship take on a different light. The learned trial Judge had proper regard to all matters relevant to hardship to the parties.
67 The plaintiffs’ explanation for their conduct was accepted by the learned trial Judge in the following passage:-
" The defendant submitted the delay from early March is unreasonable. While the plaintiffs became aware at that time that the wall would be higher than they thought it should be, that knowledge came from seeing metal frames erected on the western boundary. It was not until mid April when the walls were topped that the ultimate height and full impact could be properly appreciated. In addition, I accept Mr Opie’s explanation for not taking action in March given in the lengthy answer to which I have already referred. The defendant submitted that answer was not a “sensible explanation”. I do not agree with that submission. While it might be suggested that Mr Opie was unduly sensitive, I am satisfied that he was telling the truth in that answer and that his reaction was not unreasonable. His reaction was that of a person who had relied upon Mr Cheney and subsequently found that, not only was his reliance misplaced, but his concerns were brushed aside by Mr Cheney who treated him with a degree of disdain. A significant feature of the dealings that led to Mr Opie’s state of mind was the way in which Mr Cheney brushed off the complaints about the change in the position of the western return and denied that he had paced out the distance. Those dealings were described in pars 23-26 of Mr Opie’s affidavit of 9 July 1999." [328]
68 Counsel for the defendant criticised the learned trial Judge for testing the plaintiffs' delay subjectively and it was submitted by reference only to their state of mind. To have regard to the plaintiffs' state of mind was, in my view, entirely appropriate but in any event His Honour did expressly consider whether the explanation offered was reasonable. His Honour assessed the plaintiffs' conduct by reference to objective criteria. I find no error in His Honour's approach and reject counsel's criticism.
69 The equitable defence of laches raises discretionary considerations. The learned trial Judge was faced with the task of balancing the respective considerations and coming to a conclusion. His Honour's findings of fact have not been shown to be erroneous. I see no reason to disturb them. Further there is, in my opinion, no substance in the contentions of counsel that His Honour erred in the application of well accepted principle. In my opinion the rejection of the defence of laches was correct. I express my concurrence with the orders made by the learned trial Judge for the reasons that he has given.
70 In my opinion the appeal should be dismissed.
JUDGMENT CITATIONS LISTED IN ORDER OF APPEARANCE IN JUDGMENT
COLLUM v OPIE
1 (1931) 45 CLR at 282
2 (1924) 35 CLR at 386
3Snell's Principles of Equity 27th edition page 54
4 1874 5PC 221 at 239-240
5 (1878) 3 App. Cas. 1218, at pp 1279-1280
6Turner v General Motors (Australia) Pty Ltd (1929) 42 CLR 352 per Dixon J at 369-370; Fysh v Page 96 (1956) CLR 233 per Dixon CJ, Webb & Kitto JJ at 243-4; O'Brien v Australian and New Zealand Bank Limited (1973) 5 SASR 347 per Zelling J at 358-9.
7 (1988-1989) 167 CLR 316 at 341
8Roberts v Tunstall (1845) 4 Hare 257; Fysh v Page (1956) 96 CLR 233 at 243
4