Eclipse Developments (WA) Pty Ltd v Laserline Enterprises Pty Ltd t/as ADWEST Group [No 2] - [2012] WADC 16

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS

LOCATION: PERTH

CITATION: ECLIPSE DEVELOPMENTS (WA) PTY LTD -v- LASERLINE ENTERPRISES PTY LTD t/as ADWEST GROUP [No 2] [2012] WADC 16

CORAM: REGISTRAR KINGSLEY

HEARD: 15 NOVEMBER 2011

DELIVERED : 24 JANUARY 2012

FILE NO/S: CIVO 1234 of 2011

BETWEEN: ECLIPSE DEVELOPMENTS (WA) PTY LTD
Plaintiff
AND
LASERLINE ENTERPRISES PTY LTD t/as ADWEST GROUP
Defendant

Catchwords:

Practice - Application to strike out statement of claim - Building construction case - Turns on own facts

Legislation:

Nil

Result:

Application allowed to the extent a Minute of Proposed Amended Statement of Claim to be filed

Representation:

Counsel:

Plaintiff: Mr H Kremer
Defendant: Ms G Visscher

Solicitors:

Plaintiff: H Kremer & Co
Defendant: Murfett Legal

Case(s) referred to in judgment(s):

Barclay Mowlem Construction Ltd v Dampier Port Authority (2006) 33 WAR 82
Eclipse Developments (WA) Pty Ltd v Laserline Enterprises Pty Ltd trading as Adwest Group [2011] WADC 103

REGISTRAR KINGSLEY: The defendant (Laserline) brought proceedings in the Magistrates Court claiming the sum of $74,506.78 for moneys owing under invoices rendered in accordance with sub-contract agreements entered into between the parties on 15 September 2009. The plaintiff (Eclipse) has defended that proceeding and also launched a counterclaim for damages totalling $245,586.70. Laserline as claimant in the Magistrates Court commenced its summary of facts relevant to the claim by pleading:
(a)The claimant under subcontracts dated 15 September 2009 with the defendant, completed the manufacturing of structural steelworks at the request of the defendants during the period August 2009 to March 2010.
(b)In its statement of defence to the claim Eclipse admits that invoices were rendered to it, but 'denies each and every allegation of the statement of claim'. That is Eclipse denies there was an agreement dated 15 September 2009.
(c)By its Magistrates Court Form 8 counterclaim Eclipse pleads that on or about 15 September 2009 it and Laserline entered into contracts (later defined as subcontract agreements on specific terms as to supply of labour and materials. In its defence to the general procedure counterclaim Laserline agrees there were short form subcontract agreements dated 15 September 2009.
After some difficulty - see Eclipse Developments (WA) Pty Ltd v Laserline Enterprises Pty Ltd trading as Adwest Group [2011] WADC 103 – the Magistrates Court action was remitted to this court.
In the District Court proceeding Eclipse now as plaintiff pleads in a re‑amended statement of claim dated 13 October 2011 that it and Laserline now as defendant entered into four sub-contract agreements on 15 September 2009 to carry out structural steel work at four primary schools. Eclipse goes on to plead (par 6.2 - Statement of Claim) that there were express terms of each of the sub‑contract agreements, one express term being that 'each subcontract agreement, in effect, incorporated the terms and conditions of the head documents namely - 6.2.1 The General Conditions of Contract AS212K/1992 as amended in the contract specifications'.
Eclipse pleads (par 8 – Statement of Claim) that Laserline did not carry out the structural steel work in accordance with the programme of works, in breach of the 15 September agreement. In par 9 and par 10 of the statement of claim, Eclipse pleads further breaches by Laserline under various headings.
Laserline admits the four sub-contract agreements to carry out structural steel works but denies the date of the agreement. Laserline in a re‑amended defence and counterclaim dated 7 September 2011 (the defence) says the parties entered into an agreement on 17 July 2009. The structural steel works pleaded by Eclipse are defined by Laserline in par 2.5 of the defence. Laserline goes on to plead in par 2 of the defence terms of the 17 July agreement as to when various aspects of the work would be completed. Laserline pleads (par 2.9 – Defence) that Eclipse provided a programme of works in July 2009, but that in late July Eclipse told Laserline it did not have to observe that programme as Eclipse intended to alter it.
Laserline goes on to plead (par 4 – Defence) various terms of the 17 July agreement, including a term that Eclipse would provide a programme for the works which would allow Laserline to carry out the works in the pleaded time frames. Laserline pleads (par 5 – Defence) that Eclipse did not provide the programme for the works until 22 October 2009 for three of the schools and not at all for the fourth school.
Laserline, at par 11 of the defence pleads Eclipse provided design drawings that were unfit for their purpose and the faults are particularised. Laserline goes on to plead that on or about 12 August 2009 John Baverstock, for Eclipse directed Mark Brennan for Laserline to commence fabrication of steel for two schools, which was done by Laserline between 12 August 2009 and 4 September 2009. Further, Laserline pleads that Eclipse provided to Laserline design changes to two schools and directed Laserline, pursuant to the 17 July agreement to carry out those changes. In addition Laserline alleges variations to the rakers, purlins, and braces and by reason of all variations Laserline alleges it has suffered damages. Laserline has brought a counterclaim, which raises additional issues.
Eclipses reply to the re-amended defence pleads Laserline had the design documents as early as 5 June 2009 and that the documents had been prepared by Eclipse's principal – the Minister of Works. Eclipse denies the 17 July agreement but then says if there was an agreement made on 17 July, that agreement was discharged and the terms extinguished when the parties entered into the 15 September sub‑contract agreements.
At par 5 of the reply Eclipse pleads an initial construction programme, in a critical path network format, for each of the four schools were supplied by Eclipse to Laserline in or about 27 July 2009 and 29 July 2009. Eclipse pleads that initial construction programme allocated a specified number of days to complete the erection of structural steel for each of the schools. Eclipse goes on to plead (at par 9.3 – Reply) that the initial construction programmes were revised, by Eclipse, to accommodate Laserline, and the revised construction programme accorded with Laserlines then rate of progress.
The foregoing is a broad summation of the issues raised in a building construction action. Laserline submits that the statement of claim, and the reply and defence to counterclaim are so flawed they should be struck. In essence Laserline complains that Eclipse's pleading:
(a)omits material facts in terms of the contract, the programme of works, the breach of contract and damages claim;
(b)is inadequately particularised in relation to the plea Laserline caused delay; and
(c)is otherwise embarrassing principally because paragraphs of the amended statement of claim are either confusing, or contradictory with the reply.
Laserline's outline of submissions dated 19 October 2011 detailing the complaints with the amended statement of claim goes from the substantial to the nitpicking.

The Applicable Legal Principles

In Barclay Mowlem Construction Ltd v Dampier Port Authority (2006) 33 WAR 82 Martin CJ described what he regarded as the contemporary purpose of pleadings. Against a background of case management, pre-trial directions and the exchange of witness reports, where there is little opportunity for surprise and ambush, Martin CJ stated;
[I]t follows that provided a pleading fulfils its basic functions by identifying the issues, disclosing an arguable course of action or defence, as the case may be, and apprising the parties of the case that has to be met, the court ought properly be reluctant to allow the time and resources of the parties and the limited resources of the court to be spent in extensively debating the application of technical pleadings rules that evolved in and derive from a very different case management environment.

Laserline's complaints

The amended statement of claim pleads (par 6.2 - Amended Statement of Claim) that there were express terms in each of the four sub‑contract agreements that incorporated the head document. The amended statement of claim pleads each sub‑contract incorporated AS214/1992. Whilst head contract is defined (par 3 - Amended Statement of Claim) there is no definition of head document nor head contract documents (par 6.2 - Amended Statement of Claim). There is a confusion of terminology that causes embarrassment.
There is criticism that the relevant terms of the General Conditions in par 6.2 - Amended Statement of Claim are not pleaded out. In fact there is no reference subsequent to the General Conditions. However the defendant denies the sub-contract agreements incorporated the General Conditions (par 4.1.5) as a whole but were incorporated only as to release of the retention moneys. In its reply Eclipse pleads out the relevant clauses going to the Head Contract Procedures for Variations (par 8.6 Reply).
I am of the opinion that the issue of the General Conditions does not cause any embarrassment to Laserline.
Eclipse does not plead the relevant dates in relation to its programme for the works. At par 8 of the amended statement of claim there is, by implication, a date for completion. However it is not for Laserline to infer what is the applicable date: it is for Eclipse to specifically plead the date as this date is a fact upon which a finding must be made.
However the significant issue is what is meant by 'the programme for the works'. It is apparent that Eclipse and Laserline were in discussions in June and July 2009. Thus in answer 3 to Laserline's request for particulars, Eclipse makes reference to an initial programme for works which were revised by Eclipse and supplied to Laserline in October 2009.
The function of particulars is to narrow and more particularly define the issues. If there was no contract ‑ as Eclipse pleads ‑ until October 2009 then the only relevant contractual document would be the programme for works supplied at that point. Whilst the pleading of the initial programmes for the works may be by way of explanation, there is confusion as to the legal status of the initial programmes for the works.
Laserline pleads Eclipse provided a programme for the works in July 2009 (par 2.9 Defence). Eclipse admits an initial programme for works was supplied (par 5.1 Reply) and then goes on to plead a revised construction programme was delivered to Laserline in October 2009 (par 9.3 Reply).
Laserline has to assume that the revised construction programme (par 9.3 Reply) is the same as the programme for works pleaded in the amended statement of claim.
There is a confusion in terminology between the amended statement of claim, the answers to particulars and the reply to defence and defence to counterclaim. Eclipse refers to either a programme for the works, a revised construction programme, a works programme, or an initial construction programme. This confusion of terms is embarrassing to Laserline.
Laserline submits that par 10 of the amended statement of claim contains unparticularised allegations in relation to additional delays because of the need to have Laserline on site to undertake rectification caused other trades to be disrupted. Thus Laserline submits that there are no particulars of the dates and extent of delay, nor the trades said to have been delayed.
In addition Laserline submits that Eclipse has failed to particularise its damages particularly in relation to delay costs.
Whilst the complaint has merit, in my opinion these issues can properly be dealt with by way of a Scott Schedule. The pleading is presently adequate to enable Laserline to know what case it has to meet.
Laserline submits that there is a confusion of terminology in that par 19 of the reply refers to invoices whereas par 12.2.2 of the reply refers to payment claims. I see no inconsistency when Laserline refers to making a payment claim to Eclipse by reference to particular invoice numbers (for example see par 28 Amended Defence).

Conclusion

In my opinion there is a confusion of terminology in relation to the programme of works that needs to be clarified. There is also confusion as to the relevance of the initial construction programme and its relationship to the contractual programme for works (on Eclipse's case). It may well be that there is a pre-contractual factual matrix that may need to be pleaded out. This would not be a question of anticipating any defence but of putting the contractual programme for works, on Eclipse's case, into context.
In my opinion the particularising of damages can wait and be incorporated into a Scott Schedule. The Scott Schedule can be cross referenced to the documentary or other evidence to support particular heads of damages.
The other criticisms of the amended statement of claim detailed in the submission of Laserline do not, in my opinion, warrant the statement of claim being struck.
For these reasons Laserline's application has merit. Rather than strike out the amended statement of claim, the best course is to allow Eclipse to bring in a Minute of Proposed Amended Statement reflecting the various amendments already made, and my reasons.
To that end Laserline's application is adjourned to 23 February 2012 at 2.15 pm. Eclipse is to bring in a Minute of Proposed Amended Statement of Claim on or before 17 February 2012.
I will hear, Counsel on 23 February 2012 at 2.15 pm as to costs, and the balance of the application.