De Andrade v One Star Group Pty Ltd (Appeal) - [2017] ACAT 39

ACT CIVIL & ADMINISTRATIVE TRIBUNAL

DE ANDRADE v ONE STAR GROUP PTY LTD (Appeal) [2017] ACAT 39
AA 6/2017
Catchwords: APPEAL – appeal dealt with as new application – non-payment for work done – terms of contract on the balance of probabilities
Legislation cited: ACT Civil and Administrative Tribunal Act 2008 s 82
Cases cited:Brown v Brown (1905) 5 SR (NSW) 146
Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523
Lando v Krown Living Pty Ltd & Ors [2016] ACAT 60

WA Dewhurst & Co Pty Ltd v Cawrse [1960] VR 278

Tribunal: Presidential Member G McCarthy

Date of Orders:  22 May 2017
Date of Reasons for Decision:         22 May 2017
AUSTRALIAN CAPITAL TERRITORY )
CIVIL & ADMINISTRATIVE TRIBUNAL       )  AA 6/2017
BETWEEN:
RUBIE DE ANDRADE
Appellant

AND:
ONE STAR GROUP PTY LTD
Respondent

TRIBUNAL: Presidential Member G McCarthy

DATE:22 May 2017
ORDER

The Tribunal Orders that:

The orders under appeal are confirmed.

..………………………................
Presidential Member G McCarthy

REASONS FOR DECISION

The appellant, Rubie de Andrade, appeals from an order of the Tribunal made on 23 January 2017 that she pay the respondent, One Star Group Pty Ltd (One Star), $13,125.02 comprised of $12,400 as a debt owing to the respondent, $290 for the Tribunal filing fee and $435.02 by way of statutory interest.
On 2 March 2017, the Appeal Tribunal ordered that the appeal be dealt with as a new application pursuant to section 82(a) of the ACT Civil and Administrative Tribunal Act 2008. On 7 April 2017, sitting as the Appeal Tribunal, I heard the appeal as a new application.
Ms de Andrade appeared for herself. Ms L Carroll appeared for the respondent.
Ms de Andrade owns a substantial two-storey home in Lefroy Street, Griffith, ACT. Photographs tendered in evidence displayed a generous staircase from the first floor to the ground floor. Ms de Andrade said it was a large home with eight bathrooms. The photographs display extensive renovations in progress at the time.
One Star carries on a residential and commercial painting business.
By amended quotation No: 0388 - 2 dated 16 February 2016, One Star provided Ms de Andrade with a quote for internal and external painting of Ms de Andrade’s house. For internal painting, the quote was for the upstairs walls and architraves, including repairs and repainting where needed but not the ceilings; the stairs including the stairway retaining wall and skirting board but not the ceiling; the downstairs parts of the house including existing and new ceilings, walls, architraves, doors and skirting boards that needed to be repainted. For external painting, the quote was for the garage ceiling eaves. The quoted price was $19,000 plus GST of $1,900 to a total of $20,900.
Mr Steve Cho, the managing director of One Star, gave evidence at the appeal hearing that Ms de Andrade said to him that she accepted the quote and that he then arranged painters in the employ of One Star to carry out the works under the quote.
Ms de Andrade gave evidence that she said to Mr Cho that she rejected the quote, and that Mr Cho instead performed painting work (via his painters) pursuant to a series of oral contracts made from time to time between her and Mr Cho. Ms de Andrade said that in each case she described to Mr Cho the work to be done; Mr Cho gave a price for the work as described; Mr Cho or painters on his behalf did the work as described; and she then paid Mr Cho in cash for the work.
Ms de Andrade said that this arrangement continued through February and March 2016 until April 2016, when there was a dispute about defects and the quality of work for which reason she did not pay Mr Cho at all during April 2016.
By a second quotation No: 0398 dated 15 March 2016, One Star provided Ms de Andrade with a quote for external painting of a retaining wall and re-painting of a downstairs rendered wall for a quoted price of $1,700 plus GST of $170 to a total of $1,870. Mr Cho said that he and Ms de Andrade negotiated the quote to an agreed price of $1,500 and that One Star then carried out the works described in the quote for the negotiated price.
Ms de Andrade again denied ever accepting quote 0398 for the quoted price or a negotiated price of $1,500, and again said that work was instead done pursuant to oral agreements between her and Mr Cho.
Notwithstanding the dispute that arose in April 2016 about defects and unfinished work, Ms de Andrade said that she nevertheless paid Mr Cho each time he requested money to a total of $27,000 - $4,600 more than the total of the amounts stated in the quotes.
As evidence of these payments, Ms de Andrade tendered three pages of bank statements from a business account in the name of Marhaba De Pty Limited, Hello Cafe Shop, Blamey Place, Campbell, ACT, evidencing cash withdrawals on 24 February 2016 ($1,000), 26 February 2016 ($1,000), 17 March 2016 ($6,000), 18 March 2016 ($1,000), 24 March 2016 ($1,000) and 2 May 2016 ($7,000). These cash withdrawals totalled $17,000. Ms de Andrade said that she gave all the cash withdrawn to Mr Cho.
The bank statements also record payment of a cheque, having cheque number 00452, for $5,000 on 29 February 2016. Ms de Andrade said this was a cheque made out to “cash” that she gave to Mr Cho.
Regarding the additional $5,000 to reach the total of $27,000, Ms de Andrade said she made a cash payment of $5,000 to Mr Cho at her house on or about 20 February 2016. Ms de Andrade said she had no record of that payment because it was cash that she had at her house that was part of the weekly takings from her business.
Ms de Andrade said that she did not have a receipt for any of these payments because Mr Cho would not give her a receipt or any receipts.
Mr Cho agreed that he received a cash payment of $5,000 from Ms de Andrade on Saturday, 20 February 2016 at the house. The same day, he sent Ms de Andrade a text message stating “$5000 received 20/02/16”.
Mr Cho agreed that Ms de Andrade made a second payment when she gave him a personal cheque for $5,000 made out to cash that he took to Ms de Andrade’s bank. He agreed that the bank teller accepted the cheque and gave him $5,000 in cash. This transaction appears to be that recorded in Ms de Andrade’s bank statements by presentation and payment of cheque No. 00452 for $5,000.
Mr Cho denied receiving any other money from Ms de Andrade.
Mr Cho said that he (through One Star’s painters) performed the work as described in the two quotes. He said that he or the painters returned to the house to correct defects and unfinished work as marked by pieces of green tape. One Star claims for the balance owing under the two accepted quotes: $10,900 under the first quote and $1,500 under the second quote.
Ms de Andrade claims that she does not owe One Star anything, having paid Mr Cho $27,000 in cash payments for performance of work under periodic oral agreements made from time to time which exceeds the amounts owed under the quotes.
Ms de Andrade also claims that she should not have to pay because the work remains defective and unfinished.
On the issue of defects and unfinished work, the Appeal Tribunal received evidence by telephone from another painter, Mr Enrique Alcazar, who said that in March 2016, soon after Mr Cho and his painters had finished their work, he came to the house at Ms de Andrade’s request to identify defects and unfinished work. Mr Alcazar said that he placed pieces of green tape on the identified defects and unfinished work. The Tribunal received into evidence photographs of various parts of Ms de Andrade’s house displaying these pieces of green tape.
Ms de Andrade described Mr Alcazar as an excellent painter who she had dealt with on many occasions, but who had not been contracted to do the work.
It appears clear that Mr Cho corrected the defects and unfinished work marked by the pieces of green tape. On 5 April 2016, Mr Cho sent a text to Ms de Andrade stating:
Okay I looked around. green tape is totally acceptable. I can fix that up for you. I can fix matrix and render wall too. But, Matrix is not a my fault!
..
Sorry about reaction this morning. I was uncomfortable for you get other painter to inspect my job. I think, no one happy with that. Also, we don’t have any teenage painter. Younger painter is 35 and licensed painter.
If we fix all this green tape, are you going to make full payment?
It appears clear from the further text messages referred to below that Ms de Andrade avoided the question about payment and pressed Mr Cho for correction of the defects. It also appears clear that Mr Cho, in the hope of being paid, corrected the identified defects. On 27 April 2016, he sent a text message to Ms de Andrade stating:
Hi Rubie. We finished all defects inside and outside today, except top window above entry door due to no scaffolding. Please come around and double check. If you have any problem, let me know. I’m more than happy to come back and finish that up for you. Also, let me know when you going to organise scaffolding. Thanks,
Mr Alcazar gave evidence that “last night” (which I understood to mean the evening of 5 April 2017, the day before the appeal hearing) he came to Ms de Andrade’s house and saw “bits and pieces that were not finished” and areas that were “not even painted”.
Outside the house, Mr Alcazar referred to the garage bulkhead and an area above the garage roller door that had not been painted, and the garage metal door which still had the original primer.
Inside the house, Mr Alcazar referred to a few patches that needed to be repaired and that on the staircase there were some patches that had been “missed”. He agreed that there was a “good chance” that some of the defects he viewed on 5 April 2017 could have occurred by way of accidental damage during the previous 12 months since the painting work was done.

Consideration

The first issue for determination was whether One Star (or Mr Cho) performed painting work for Ms de Andrade in accordance with the two quotes or under a series of oral agreements.
I first note that it is beside the point that Ms de Andrade did not accept the quotes in writing. It is commonplace, particularly in the building industry, for a tradesperson to provide a quote for proposed work; for the quote to be accepted orally or by inference (for example by inviting and permitting the tradesperson to start work); and for the tradesperson then to proceed with the work as quoted. Acceptance of a quote in writing is not necessary to form an agreement. In many cases, formation of an agreement and the terms of the agreement can be inferred from the subsequent conduct of the parties.[1]
[1] Brown v Brown (1905) 5 SR (NSW) 146; Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523; WA Dewhurst & Co Pty Ltd v Cawrse [1960] VR 278
The numerous and contemporaneous SMS text messages between Mr Cho and Ms de Andrade demonstrate in my view that One Star performed the work described in the quotes, and that Ms de Andrade permitted and facilitated that work to be done.
For example, on 18 February 2016, Mr Cho sent a text message to Ms de Andrade stating:
Hi Rubie, Sorry about bothering you after working hour. Could you please confirm our quote with reply our acceptance of quote email? It would be much appreciated. Thanks.
The following day Mr Cho sent a further text message stating:
Please let me know you want to meet me today 5:00 or tomorrow morning. Thanks.
Over the following days, work commenced and Mr Cho and Ms de Andrade exchanged text messages about timeframes for performance of work and part payments for work as work progressed. For example, on 24 February 2016 Mr Cho sent a text message stating:
Hi Rubie, How are you? I would like to claim another five sometime this week. Are you fine with this? All internal door and frame will be done by tmr morning. Then, we will start final coat to wall tmr afternoon. So, you will see 90% of work will be done by this weekend.
In my view, the reference to “90% of work” should be understood as 90% of the work identified under the first quote. Ms de Andrade replied by text message stating:
Hi Steve thank you yes I’m fine with that ...
Regarding the second quoted works, on 15 March 2016 Mr Cho sent a text message stating:
Hi Rubie, I just sent you quote through email. If you accept, We will be there tomorrow and finish that up. Otherwise, we won’t be there tmr. Please let me know ASAP. It would be much appreciated.
On 16 March 2016, Ms de Andrade replied by text message stating:
Good morning Steve I just read your quote Can you match the quote perviously [sic] given at 1,500?
On 17 March 2016, Mr Cho sent a text message stating:
Hi Rubie, Can we meet and sort payment out? We’ve done more than 90% of our contract work. Also, new contract external work will be done by this week too. Please let me know your suitable time.
Again, in my view the reference to “90% of our contract work” is a reference to the works described in the first quote, distinguished from the “new contract external work”.
On 17 March 2016, Ms de Andrade sent a text message in reply stating:
Hi Steve, I will talk to you soon Thank you for your text
On 22 March 2016, Mr Cho sent a text message stating:
Hi Rubie, Sorry about bothering you after work. Can I meet you up some time tomorrow to sort payment out? We’ve completed 99%. We’ve been paid only half since two weeks ago. Please let me know your suitable time tomorrow.
In my view, “only half” is a reference to the payments totalling $10,000 made on 20 and 29 February 2016, being approximately half of the quoted price of $20,900.
In her reply, Ms de Andrade did not respond to the request for payment and referred only to further work she required.
On 29 March 2016, Mr Cho sent a text message stating:
Hi Rubie, Sorry about bothering you late. I’ve been waiting for your response today. Please make our remaining balance without $500 for touch up by tomorrow. We’ve been waiting for three weeks now after almost 100% completed. Also, let me know about how’s rendering going on. Thanks again.
Again, in my view the words “our remaining balance” should be understood as the balance outstanding under the first quote (i.e. $10,900) less $500 that Mr Cho was allowing to be paid after “touch up” work was done to complete the contracted works.
On 2 April 2016, Mr Cho sent a text message stating:
Rubie, I know what you are trying to do. But, that is not going to work to me. I heard about you from your builder, trades as a not a good payer. I will come with rep from Taubman with spec and James Hardie spec. Also, I will get approved building inspector to proof [sic] what I did is right. If your painter[2] say bullshit I will sue him too. I’ve got acceptance of quote as a evidence. Sorry I’m not that easy person. I will give you 48 hours to make payment 90% of remaining balance. Otherwise, You will be contacted by my solicitor. Due by 4th April Mon 2.00pm.
[2] By ‘painter’, I infer Mr Cho to be referring to Mr Alcazar whom Ms de Andrade engaged to check One Star’s work for faults and defects
These text messages confirm in my view that the work was being done by reference to the quotes. They are completely inconsistent with the proposition that Mr Cho or One Star were instead performing separate pieces of work under a series of independent oral agreements.
There are no text messages from Ms de Andrade contradicting Mr Cho’s repeated descriptions of the work done in terms of percentages of the contracted work that was done and the portions of money outstanding under the first quote. There is no mention in any of her text messages of an oral agreement, or a description of work done under an oral agreement or references to payments made or owing under separate oral agreements.
At the appeal hearing, Ms de Andrade gave only the vaguest evidence about these alleged oral agreements either as to the work done or the prices paid. There was no correlation between these alleged oral agreements and the cash withdrawals. There was no suggestion in any of Ms de Andrade’s text messages sent in reply to Mr Cho’s increasingly firm text messages requesting payment that a payment or payments had been made.
That work was done under a series of oral agreements is also inconsistent with the evidence of Mr Alcazar, who said that he came to Ms de Andrade’s house in March 2016, soon after One Star completed the works described in the first quote, and placed pieces of green tape on identified defects and unfinished work.
Having reviewed the evidence, I am satisfied on the balance of probabilities that Ms de Andrade and Mr Cho by their conduct agreed that One Star would perform the work described in the quotes for the prices stated in the written quotes save for the renegotiated price for the works described in the second quote.
The next question for determination was whether Ms de Andrade has already paid for the work done, in the sense that she has paid $27,000 to Mr Cho, and so is not liable to pay any more. Ms de Andrade could not provide any evidence to support her making payments to Mr Cho, save for Mr Cho’s one line text message regarding the payment of $5,000 in cash on 20 February 2016. That payment is agreed.
Ms de Andrade relied on the bank statements described above to evidence cash withdrawals, but these entries on the bank statements prove only that on the dates stated those sums were withdrawn in cash from the bank account. The withdrawals say nothing about what became of that money. I am forced to decide between Ms de Andrade’s unsupported claim that she gave it all to Mr Cho and his unsupported claim that he received nothing further than the two payments of $5,000 each. For several reasons, I prefer the evidence of Mr Cho.
First, as Ms Carroll pointed out, One Star “wouldn’t be here” (meaning the Tribunal) if Ms de Andrade had paid for the work done. It is quite illogical that Mr Cho would incur the time, inconvenience and cost of engaging a debt collector and then bringing proceedings in the Tribunal to recover money that he had already received. For reasons not relevant to this proceeding, it was of concern that One Star did not render a tax invoice or any periodic tax invoices for work done until 9 June 2016, when it rendered two tax invoices both dated 9 June 2016. Mr Cho said that he sent the invoices to “make it legal”. It was apparent from the late rendering of the invoices that Mr Cho had remained willing to accept further cash payments from Ms de Andrade, but they are still consistent with a conclusion that One Star had not been paid, save for the two payments of 20 and 29 February 2016.
Second, at the previous hearing before the Tribunal, Ms de Andrade answered “yes” to the presiding member when asked if she had “paid $20,000 in total?”[3]; and “$20,000” when asked “how much do you say you have paid?”[4] Ms de Andrade’s response as filed in the previous proceeding stated “payments made equal 20,000!”
[3] Transcript of proceedings 23 January 2017, page 12, lines 41-45
[4] Transcript of proceedings 23 January 2017, page 13, lines 23-41
As evidence of having made the payment of $20,000, Ms de Andrade provided bank statements 192 and 193 from the business account covering the period 29 February to 30 March 2016 on which she had highlighted all the entries marked “Withdrawal” totalling $10,000 and cheque number 004542 for $5,000 which, she said, totalled $20,000. When the Tribunal pointed out that these sums totalled only $15,000 Ms de Andrade referred to a further payment of $5,000 and said:
That 20,000 (sic), that was money that I had that I hadn’t deposited but I think that was on 20 February. That 5000 on 20 February we gave it to him, cash straight up.[5]
[5] Transcript of proceedings 23 January 2017, page 15, lines 23-28
Notwithstanding Ms de Andrade’s certainty at the original hearing that she had paid Mr Cho $20,000, at the Appeal Tribunal hearing before me she contended that she had paid $27,000. Ms de Andrade provided in evidence the first page of bank statement number 195 from the business account which records an entry “Withdrawal” for an amount of $7,000 on 2 May 2016 alongside which someone, presumably Ms de Andrade, has written the word “painter”. She claimed that this was a further payment to Mr Cho.

I find it wholly improbable that Ms de Andrade would attend a hearing before the Tribunal on 27 January 2017 to defend a claim that she had not paid for painting services at her house at which she gave such firm evidence that she had paid $20,000 towards the cost of painting work itemised by reference to cash payments in February and March 2016 and yet overlook a further cash payment of $7,000 to Mr Cho on 2 May 2016.
Third, there is no statement or suggestion in any of Ms de Andrade’s text messages sent in reply to Mr Cho’s increasingly firm text messages requesting payment that she had made a payment of any amount to Mr Cho. Her text messages are more consistent with the conclusion that no payment had been made.
In her text replies, Ms de Andrade did not respond to the demands for payment and wrote only about the work she wanted done, the timeframes in which she wanted it done and when she would be meeting with Mr Cho for this purpose. For example, in response to Mr Cho’s text sent on 2 April 2016 again demanding payment, Ms de Andrade completely ignored the demand and instead advised Mr Cho that a rendered wall was now fixed and that he can paint it. When Mr Cho replied “Sorry. Until you make payment, we can’t come back and finish job. Read carefully my previous message”, Ms de Andrade replied by text message stating:
Hi Steve final payment will not be made until it is finished. All defects have to be fixed. I will see you on Tuesday Thank you.
It is completely illogical that Ms de Andrade would state on 4 April 2016 that “final payment will not be made” if she had already paid $22,000 as at 24 March 2016.
Fourth, I do not accept Ms de Andrade’s claim that Mr Cho refused to provide receipts. He provided a receipt by text message for the payment made on 20 February 2016, apparently unprompted, and there is no statement or suggestion in any of her text messages that she ever asked for a receipt or that Mr Cho refused to provide one. The apparent explanation for the absence of a receipt is that the payments were not made.
As is apparent from the preceding reasons, I found Ms de Andrade’s evidence to be wholly unreliable. Also, in my view, Ms de Andrade conducted a tactic of withholding 50% of the money she owed in a largely successful endeavour to compel Mr Cho to complete the works to her satisfaction, without an intention of paying the balance owing under the contracts in the belief that Mr Cho would decide that it was not cost-effective to pursue the debt.
I am satisfied on the balance of probabilities that Ms de Andrade has paid One Star, via Mr Cho, $10,000 only.
The remaining question is how much more Ms de Andrade is liable to pay in circumstances where Ms de Andrade disputes the quality of the work, alleging defects and omissions. She relies on the evidence of Mr Alcazar detailed above.
I am satisfied on the evidence that the work was done in a fit and proper manner. Even if there were outstanding defects or matters to complete, the contemporaneous text messages that passed between Ms de Andrade and Mr Cho detail his return to the house on 27 April 2016 to correct the identified defects and his offer to return to the house and correct any further defects or omissions that she identified.
The evidence of Mr Alcazar did not persuade me that any discount from the quoted prices should be allowed. Mr Alcazar detailed defects of the omissions with green tape, but the contemporaneous evidence shows that Mr Cho attended to those defects.
Regarding remaining faults that Mr Alcazar identified a year later, Mr Alcazar described them in minor terms and agreed that they could have resulted from fair wear and tear that occurred in the 12 months since the painting works were completed.
Regarding areas that had not been painted, or had only been primed, I was not satisfied of the balance of probabilities that those works were within the quote. In any event, the contemporaneous evidence shows that Mr Cho remained willing to return to correct any works that had not been done in accordance with the quoted scope of works.
For these reasons, I am satisfied that One Star’s claim to the Tribunal was properly made. In circumstances where I have concluded that the orders under appeal were correct, although I have arrived at that conclusion after conducting the appeal as a new application, the orders under appeal will be confirmed.
Post judgment statutory interest is payable on the amounts payable under the Tribunal’s orders made on 23 January 2017 from 23 January 2017 to the date when those amounts are paid.[6]
[6] Lando v Krown Living Pty Ltd & Ors [2016] ACAT 60 at [42]
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Presidential Member G McCarthy

HEARING DETAILS

FILE NUMBER:	AA 06/2017
PARTIES, APPELLANT:	Rubie De Andrade
PARTIES, RESPONDENT:	One Star Group Pty Ltd
COUNSEL APPEARING, APPELLANT	N/A
COUNSEL APPEARING, RESPONDENT	N/A
SOLICITORS FOR APPELLANT	N/A
SOLICITORS FOR RESPONDENT	N/A
TRIBUNAL MEMBERS:	Presidential Member G McCarthy
DATE OF HEARING:	6 April 2017