Dux Plumbing Services v Sandra's Tax Services

[2003] NSWSC 323

CITATION:	Dux Plumbing Services v Sandra's Tax Services [2003] NSWSC 323
HEARING DATE(S):	7 April 2003
JUDGMENT DATE:	17 April 2003
JURISDICTION:	Common Law Division
JUDGMENT OF:	Master Malpass
DECISION:	The Summons is dismissed. The plaintiff is to pay the costs of the Summons.
CATCHWORDS:	Appeal from Local Court - question of construction of written agreement - no error in respect of issues litigated.
LEGISLATION CITED:	N/A
CASES CITED:	N/A
PARTIES :	Dux Plumbing Services Pty Ltd (Plaintiff) v Sandra's Tax Services Pty Ltd (Defendant)
FILE NUMBER(S):	SC 11456 of 2002
COUNSEL:	Mr C J Millard (Plaintiff) Mr B Slowgrove (Defendant)
SOLICITORS:	Hills Legal (Plaintiff) John J Puleo & Company (Defendant)

LOWER COURTJURISDICTION:	Local Court
LOWER COURT FILE NUMBER(S):	1187 of 2000 Penrith Local Court
LOWER COURT JUDICIAL OFFICER :	E Jacob LCM

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

Master Malpass

Thursday 17April 2003

11456 of 2002 Dux Plumbing Services Pty Ltd v Sandra’s Tax Services Pty Ltd

JUDGMENT

1 Master Malpass: These proceedings were commenced by Summons filed on 24 May 2002. The Summons propounds an appeal from the Local Court. The decision was handed down on 30 April 2002. The defendant in these proceedings recovered a judgment in the sum of $32,692.37.

2 The defendant sued on a written agreement. A copy of the agreement is annexed to the Affidavit of Philip Andrew Bell sworn 9 October 2002 and marked “PB4”. The material provisions of the agreement are as follows:-

“Sandra’s Tax Service Pty Ltd is under contract to the above to the value of $50,000 per annum (not including GST).
The contract covers all bookkeeping, accounts, taxes, and any other work that has to be completed for Dux Plumbing, RCM, and JST. In other words all matters that involves (sic) the office at Wiltona Place.
Sandra’s Tax Service will supply personel (sic) to maintain the office for 56 hrs per fortnight being 7 days. These hours could increase (maximum 76 hrs) depending on the workload in the office. Also due to public holidays some weeks could decrease.
Payment of fees will be on the 15th of each month or nearest Friday to the 15th, commencing March 2000. Payments will be 12 (twelve) equal amounts of $4166.67.”

The defendant had performed some services under the agreement prior to it being repudiated by the plaintiff. The defendant sued to recover the unpaid balance of the total sum ($50,000) payable thereunder.

3 The real issue agitated between the parties in the Local Court appears to have been a matter of construction (whether or not the written agreement was for a fixed period of 12 months). The litigation before the learned Magistrate appears to have been conducted by the parties on the basis that if the defendant was successful on the construction issue, it was entitled to recover the unpaid balance (the sum of $32,692.37).

4 The Summons specifies one ground of appeal only. It is in the following terms:-

“5. The learned Magistrate erred in law in finding that the contract between the parties was for a fixed period of twelve (12) months.”

5 The hearing of the appeal took place on Monday 7 April 2003. No attempt was made to amend the grounds of appeal. The one ground of appeal specified in the Summons was the only matter that was open for argument.

6 It may be that the matter should have been litigated differently in the Local Court. If that had been the case, perhaps another result may have been reached by the learned Magistrate. Be that as it may, these are not considerations which concern the court in this appeal.

7 The appeal is restricted to error of law. The parties chose the issues to be litigated before the Local Court. The plaintiff has selected the ground of appeal that it wishes to litigate in this Court.

8 Both counsel have prepared written submissions. The submissions relied on by the plaintiff contain inter alia the following:-

“8. The short point on this appeal is whether the above Agreement was for a twelve month period such that the plaintiff is entitled to payment for the full twelve month period, even though work was not performed for the entire period. It is submitted that the learned Magistrate erred in finding that the Agreement was an agreement fixed for twelve months.
9. Dux submits that the Agreement was in the nature of an ongoing retainer for Sandra to carry out work on behalf of Dux , and was not fixed for twelve months, although it appears that the parties contemplated that the retainer might extend beyond that period.
10. Dux submits that there is nothing in the express terms of Agreement that fixes the term of the Agreement for twelve months. The first paragraph of the Agreement states:
Sandra’s Tax Services Pty Limited is under contract to the above to the value of $50,000 per annum (not including GST) .
11. It is submitted that the words ‘per annum’ do not refer to a period of one year, but rather to more than one year. The reference to ‘per annum’ indicates that Sandra may have provided services for more than one year and that, if that were to be so, fees were to be calculated on a yearly basis. The intention to provide services on an ongoing, albeit yearly basis, is not consistent with a fixed agreement for one year.
12. The words contained in the first paragraph, it is submitted, indicate an intention that Sandra would provide services up to a maximum value of $50,000 per annum. This construction is consistent with the Agreement being one for work done, rather than for a fixed term which entitled Sandra to payment, regardless of whether the work was done.
13. In dealing with Dux’s submissions on this point, the learned Magistrate said:5
‘It [the Agreement] does not say ‘up the value of $50,000.00’ [sic] but is a set amount of ‘to the value of $50,000.’
14. It is submitted that had the parties intended that the contract price should be $50,000 over a twelve month period, it would have been very easy to use words that evidenced that intention. Such words as ‘in the sum of $50,000’ or ‘in the amount of $50,000’ could, and would, have been used.
15. The other relevant words in relation to the contract are the final words in the document:-
Payment of fees will be on the 15th of each month or nearest Friday to the 15th, commencing March 2000. Payments will be 12 (twelve) equal amounts of $4166.67 .
It is submitted that this sentence is no more than a mechanism for payment, and, contrary to the findings of the Learned Magistrate6 do not mean ‘… that the contract will be for a term of 12 months being 12 equal monthly payments. ’
16. It is submitted that the above words must mean that payments would be made by twelve equal amounts, assuming that the contract was still on foot. It cannot be evidence of an intention for the contract to be for a fixed term.
17. Had the parties intended that the Agreement was to be for a fixed term of twelve months it would have been very easy for the document to have recorded that intention by using such words ‘the term of this contract is 12 months’, or, ‘this contract is for 12 months’ or, ‘this contract is fixed for 12 months’, or a multitude of other expressions that would have clearly indicated an intention that the contract be fixed.
18. It is submitted that the contract must be construed as one being for the provision of services in consideration for payment of an amount up to $50,000 each year. It is submitted that it is a clear intention of the document that Sandra would only be paid for the services actually provided.
19. If one were to accept the construction placed upon the agreement by the learned Magistrate, then, it is arguable that Sandra’s claim is a continuing one. There would be nothing to prevent Sandra from continuing to claim an amount of $50,000 per annum from Dux , infinitum.
20. The second paragraph of the Agreement in Dux’s submission, clearly indicates an intention that Sandra would only be paid for the work actually done. The words ‘ the contract covers all book-keeping, accounts, taxes and any other work that has to be completed ’, clearly indicates that the work had to be done for payment to be due.”

9 Certain of the matter appearing in these submissions may be seen as an attempt to go outside of the only ground of appeal selected by the plaintiff.

10 I have carefully considered the provisions of the agreement and the arguments advanced on behalf of the plaintiff. In my view, the learned Magistrate correctly construed the written agreement. Accordingly, the only ground of appeal fails.

11 The Summons is dismissed. The plaintiff is to pay the costs of the Summons.

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Last Modified: 04/22/2003