Da Vesi Construction Group Pty Ltd (ACN 122 278 735) v Rubie De Andrade
[2019] ACTMC 1
•24 January 2019
MAGISTRATES COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | Da Vesi Construction Group Pty Ltd (ACN 122 278 735) v Rubie De Andrade |
Citation: | [2019] ACTMC 1 |
Hearing Dates: | 16 – 17 November 2017 27 November 2017 19 December 2017 |
DecisionDate: | 24 January 2019 |
Before: | Magistrate Fryar |
Decision: | See [14], [16] – [19] |
Catchwords: | CONTRACT – Breach of contract – form of contract disputed – dispute in relation to amount paid for services. PROCESS AND PROCEDURE – Failure to call relevant witnesses. PLEADINGS – Issues raised at hearing not specifically pleaded. |
Legislation Cited: | Court Procedure Rules 2006 (ACT), rules 407(1), 407(3), 446 |
Cases Cited: | Gates v City Mutual Life Association Society Ltd (1986) 160 CLR 1 Jones v Dunkel (1959) 101 CLR 298 |
Parties: | Da Vesi Construction Group Pty Ltd (ACN 122 278 735) (Plaintiff) Rubie De Andrade (Defendant) |
Representation: | Mr Pattenden of Counsel (Plaintiff) Mr O’Keefe & Mr Christensen (Defendant) |
| Solicitors Canberra Legal Group (Plaintiff) John O’Keefe Solicitor & Peter B Christensen Solicitor (Defendant) | |
File Number: | CS 835/2014 |
MAGISTRATE FRYAR:
Introduction and Issue
The plaintiff is a company which provides building and construction management services in the ACT. The defendant is the registered proprietor of the property at 28 Lefroy Street, Griffith ACT (‘the property’).
The plaintiff is claiming damages for breach of contract, or alternatively is making a claim for quantum meruit for work done and materials provided at the property. It is agreed that there was a contract between the plaintiff and the defendant for the plaintiff to perform work and provide materials in relation to the construction of a new dwelling at the property. The form of that contract is substantially in dispute.
The plaintiff claims the contract between the parties was a written project management agreement (Exhibit 9) that was executed on 10 May 2013. That agreement provided that the plaintiff would be responsible for managing the construction of the new dwelling at the property. The defendant however claims that any written contract was invalid and that there was only an oral contract for the plaintiff to construct the footings for the premises.
There is a further dispute as to how much was in fact paid by the defendant to the plaintiff. The plaintiff claims it received $80,000 whereas the defendant claims she paid the plaintiff $95,000 in cash. The plaintiff claims the defendant failed to pay the amount of $20,466.28 in respect of work performed before the termination of the contract, but the defendant claims she had paid the full amount that was due and payable.
Evidence
Mr Dale Stevanovic, on behalf of the plaintiff, gave evidence both by affidavit and in person. He presented as honest and forthright, and he was not moved in any respect in relation to his evidence by cross-examination. On the other hand I found the defendant vague and argumentative. Her evidence was full of ambiguities which she was simply unable to explain, and when confronted with difficult questions in cross-examination, she resorted to obfuscation.
The plaintiff called a document examiner, Mr Anderson, in relation to the signature on a receipt the defendant (belatedly) produced as evidence that she had paid $15,000 more than the plaintiff said that she had. His report is Exhibit 12. His finding was that the purported signature of Mr Stevanovic’s on the receipt document was a cut and paste copy and was not Mr Stevanovic’s original signature. Mr Anderson’s expertise was not challenged, and his evidence was essentially not challenged in cross-examination. Accordingly I accept his expertise in this area and his evidence, and the only inference I can draw from it, combined with the evidence of the defendant, is that the receipt document in question is in fact a forgery. That fact and the circumstances in which it was produced reflect poorly on the evidence of the defendant as a whole.
Another factor that reflects poorly on the evidence of the defendant is what the plaintiff’s counsel has referred to as the ‘Jones v Dunkel inference’. That being:
“The unexplained failure of a party to call someone who might properly be thought would be able to throw light on a fact in issue, confirms any inferences that may properly be drawn against that party, rendering more probable the inferences against the defendant that are open on the evidence”Jones v Dunkel (1959) CLR 298 at paragraph 312.
The defendant gave the only evidence in her case, despite there being a number of witnesses that seemingly may have something relevant to add but who were not called. The defendant’s application (which was refused) at the last moment for an adjournment purportedly in order for the defendant to call other witnesses seemed to be nothing but another delaying tactic by the defendant. These proceedings had been on foot for several years with the defendant represented by various lawyers at most times, and yet no genuine attempt had been made to obtain relevant evidence from other witnesses. Even in that last minute application Mr O’Keefe was not able to readily identify the witnesses that his client was suggesting she might call in the future. A number of potential witnesses were identified in Mr Pattenden’s submissions.
Pleadings
Considerable issue arose in this matter about the state of the pleadings. The plaintiff’s claim is based on the Originating Claim and Statement of Claim dated 25 July 2014. It set out the basis of the contract, the subsequent alleged breach of contract by the defendant and the particulars of the loss the plaintiff says it has suffered as a result. In the Statement of Claim the plaintiff claims damages for the breach of the contract or, in the alternative, reasonable costs of the work performed on a quantum meruit basis, and interest and costs. The defence simply denies any indebtedness to the plaintiff on a general basis, and otherwise does not admit various allegations in the statement of claim. The basis of the defence is not pleaded with any specificity.
10.At the hearing the defendant attempted to raise various matters in evidence and submissions that had not been pleaded, such as the invalidity of the contract, fraud by the plaintiff, and an issue in relation to the termination fee and minimum payment amount being penalties. The plaintiff submitted that it was not now open to the defendant to raise such issues at the hearing, as they were never specifically pleaded in the defence.
11.I agree. Apart from relevant case law, the Court Procedures Rules 2006 (ACT) relevantly provide as follows.
a.Rule 407(1) states the following matters must be specifically pleaded:
(h)fraud or illegality;
...
(3)In a defence or pleading after a defence, a party must specifically plead any matter that –
(a) the party alleges makes a claim ... not maintainable;
(b) shows a transaction is void or voidable; or
(c) raises an issue of fact not arising out of a previous pleading.
b.In relation to contractual matters, Rule 446 is as follows:
Pleadings – denial of contract
(1)This rule applies if a contract is alleged by a party in a pleading.
(2)A bare denial of the contract by the opposite party is taken only as a denial in fact of the express contract alleged or of the matters of fact from which the contract may be implied by law, and not as a denial of the legality or sufficiency in law of the contract.
(3)In this rule:
contract includes promise and agreement.
12.Given that in the defence the existence of the contract is not even denied and no fraudulent act is pleaded, in my opinion it is not now open for the defendant to raise what she says is the invalidity of the contract, or any allegation of fraud on behalf of the plaintiff. Even after evidence and submissions, it is still unclear to me on what basis the defendant says the contract is invalid.
Consideration
13.Having regard to the evidence as a whole, and the matters I have mentioned above, I accept the evidence of the plaintiff, and in particular the evidence of Mr Stevanovic concerning the execution and terms of the contract and the payments made by the defendant. I find however the defendant was not a witness of truth and I am unable to accept her evidence in relation to such matters.
14.Accordingly I find there was a valid written contract between the parties in the terms of the document tendered by the plaintiff. I further find the defendant only paid to Mr Stevanovic the sum of $80,000 in three separate payments. The defendant breached the contract by failing to pay the final amount owing. The plaintiff accepted the defendant’s repudiation and the contract was rescinded.
Damages
15.The law that applies to this aspect was appropriately stated in the written submissions of Mr Pattenden, ie: “in contract, damages are awarded with the object of placing the plaintiff in the position in which he would have been had the contract been performed – he is entitled to damages for loss of bargain (expectation loss) and damages suffered, including expenditure incurred, in reliance on the contract (reliance loss).” Gates v City Mutual Life Association Society Ltd (1986) 160 CLR 1 at paragraphs 11 – 12.
16.I am satisfied that the terms of the contract allowed for a termination fee of $75,000 excluding GST (Clause 23(d) and Part B of Schedule 15) and a minimum guaranteed fee of $150,000 exclusive of GST (Clause 27(b) of Schedule 19). The termination fee was part of the contract and cannot, in my opinion be considered as a penalty (as was submitted on behalf of the defendant). I do note however, that in the assessment of damages presented by the plaintiff in the schedule that counsel provided, and in counsel’s submissions, the minimum guaranteed fee does not seem to be pressed.
17.Clause 31 and Schedule 20 of the contract specified an interest rate of 20% on moneys owing and I am satisfied that is the appropriate interest rate to be applied prejudgment for the breach of contract.
18.I find that the plaintiff is entitled to damages and interest in accordance with the terms of the contract because of the repudiation of the contract by the defendant. Accordingly as the quantum meruit claim was in the alternative I do not need to assess that. I note some mathematical errors in the schedule of damages provided by the plaintiff.
19.There is judgment for the plaintiff in the following terms –
Expenses incurred in performance of the $ 91,332.18
contract by the plaintiff
plus 10% project management fee 9,133.22
________________
100,465.40
Less payments by defendant 80,000.00
__________________
20,465.40
Plus termination fee 75,000.00
_________________
95,465.40
Plus interest @ 20%pa ($19,093.08)
18/11/13 – 17/11/18 95,465.40
18/11/18 – 23/1/19 ($52.31/day) 3,504.77
________________
Judgment total $ 194,435.57
Costs
20.I note the plaintiff in submissions sought to be heard in relation to costs. The usual course is that costs follow the event. However if the parties still wish to be further heard in relation to costs I give leave for an approach to be made to my associate to have the matter listed before me during the week commencing 11 February 2019.
| I certify that the preceding XX [XX] numbered paragraphs are a true copy of the Reasons for Decision of her Honour Magistrate Fryar. Associate: Emma Bayliss Date: 24 January 2019 |
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