Envista Pty Ltd v Peatcorp Pty Ltd T/A Maxim Chartered
[2010] ACAT 36
•6 April 2010
ACT CIVIL & ADMINISTRATIVE TRIBUNAL
ENVISTA PTY LTD v PEATCORP PTY LTD T/A MAXIM CHARTERED
ACCOUNTANTS (Civil Disputes) [2010] ACAT 36
XD 1611 of 2009
Catchwords: CIVIL DISPUTES – accounting services – reasonable fees –
implied terms
Legislation:ACT Civil and Administrative Tribunal Act 2008 (ACT)
Tribunal:Ms J Lennard, Senior Member
Date of Orders: 6 April 2010
Date of Reasons for Decision: 9 June 2010
AUSTRALIAN CAPITAL TERRITORY )
CIVIL & ADMINISTRATIVE TRIBUNAL ) XD 1611 of 2009
BETWEEN: ENVISTA PTY LTD
Applicant
AND:PEATCORP PTY LTD T/A
MAXIM CHARTERED ACCOUNTANTS
Respondent
Tribunal:Ms J Lennard, Senior Member
Date: 6 April 2010
ORDER
Respondent is to pay an amount of $375.00 to Applicant within 7 days of this Order.
………..……………………………..
Ms J Lennard
Senior Member
REASONS FOR DECISION
The Applicant, Envista Pty Ltd, engaged Maxim Chartered Accountants to provide accounting services between April 2008 and 1 June 2009.
Envista made an application [XD 09/1055] to the Tribunal in relation to the amount of the fees levied in relation to those accounting services. The Applicant alleged that Maxim Chartered Accountants had overcharged and levied accounts for inflated amounts. The application related to specific invoices. During the course of this application, the Tribunal ordered Maxim Chartered Accountants to provide documents relating to the invoices the subject of that application. The matter was settled and the Tribunal ordered Maxim Chartered Accountants to pay Envista Pty Ltd an amount of $1,150.
Envista, upon inspection of the documents referred to above, noticed two more instances of alleged overcharging. Envista made a second application in relation to those two instances, and claimed a refund of:
a.$750 for charging for work performed prior to a formal contract being executed; and
b.$375 for charges made for unauthorised work.
At the hearing on 6 April 2010 Mr Andrew Carstens, a director of Envista, represented the Applicant and Ms Kate Mahoney of Trinity Law represented the Respondent.
The Respondent submitted that the two claims now being made had already been dealt with in the earlier matter, and that under the principle of res judicata the Applicant was estopped from bringing a second action based on information that was before the Tribunal at the first hearing. Ms Mahoney stated that the invoices now before the Tribunal had been the subject of discussion between herself and her client and that the two matters now raised had been considered by her client in agreeing to the compromise reached. She stated that the Macquarie Bank matter ‘was raised in the hearing and offered by way of set off’.
Mr Carstens stated that the earlier claim related to specific invoices and instances of overcharging and had not included the two claims now made because these were discovered only after the Respondent had made available the draft billing reports upon which invoices were based. Mr Carstens further asserts that he attempted to raise these two claims with the Tribunal but had been told that they were not connected to his claims.
The Tribunal, upon listening to the recordings of the earlier hearing, and reviewing the file for matter XD09/1055, determined:
a.The two claims currently before the Tribunal were not included in the original claim made by Envista;
b.Mr Carstens did, early in the hearing, raise the two claims currently before the Tribunal but was not able to have them considered separately, or as increasing the quantum of the reduction in fees being claimed, as Registrar Morris moved to attempt to settle the matter between the parties;
c.Neither during the hearing, nor in conversation conducted while Registrar Morris and Mr Carstens were absent from the hearing room, did the Respondent turn its mind to the issues raised in the two claims currently before the Tribunal in relation to charging prior to a formal contract being made or to charge for the meeting with Macquarie Bank;
d.The conversation between Ms Mahoney and the Respondent was such that the Tribunal concluded that the Respondent was prepared to accept whatever offer Envista made, and indeed they did accept the offer of $1,150 immediately upon it being made and without any further consultation;
e.Mr Carstens asked a second time to question the Respondent about the meeting with the Macquarie Bank but Registrar Morris indicated that that ‘forms no part of this’.
The matters now before the Tribunal were not part of the claim nor part of the settlement reached between the parties in matter XD 09/1055. The documents of facts relating to the claims were produced by the Respondent to the Applicant during the hearing of that matter but were never considered and were specifically rejected by the Tribunal. No finding of fact or determination of quantum was made.
Based upon the recording of matter XD09/1055 the Tribunal does not accept, indeed it rejects, the submissions of the Respondent that:
a.they included the claims currently before the Tribunal in any consideration of whether or not to settle the matter, and
b.they relied, to their detriment, on negotiations made in good faith.
10.The Tribunal determines that the doctrine of res judicata does not apply here; each claim by the Respondent is based upon separate and distinct documentary evidence, the claims were not before the Tribunal previously and they have not impacted upon any negotiations or settlement of previous claims between the parties, nor since the earlier application was withdrawn and dismissed has any Tribunal decision taken them into account.
11.Mr Andrew Carstens gave evidence and provided documents as follows:
The claim for $750 refund
a.Mr Carstens stated that Envista was looking for a new firm of accountants and that he had had meetings with several firms to ascertain which firm would be able to best assist with Envista’s restructure. He had, in his capacity as Director of Envista, made an appointment with Gerard Boundy of Maxim Chartered Accountants for 27 March 2008. It is common ground between the parties that this meeting took place and that it lasted for 2 hours.
b.There followed some correspondence between the parties. The Tribunal had before it:
i.A letter dated 2 April from Gerard Boundy to Envista setting out five areas which required attention; proposing that Maxim send a letter of advice by 11 April and suggesting a planning meeting to be held two weeks thereafter; and an estimate of the fees involved.
ii.An email for Allyson Pannier to Andrew Carstens, dated 4 April introducing herself as one of the managers who would be working on the Envista files and attaching a copy of the above letter.
iii.An email from Andrew Carstens to Allyson Pannier stating that the Directors of Envista confirm their intention to engage Maxim as the company accountants.
iv.An invoice (14773) from Maxim to Envista, dated 30 April 2008, for a total of $4,147. This invoice included an amount for $750 for Preparation for and attendance at the meeting on the 27 March 2008 by Gerard Boundy with Andrew regarding restructuring options for Envista Pty Ltd and other business opportunities. This invoice was paid by Envista.
12.Mr Carstens asserted that because Envista was ‘shopping around’ and because Envista had not executed a formal contract or letter of engagement with Maxim Chartered Accountant there was no contractual obligation to pay the amount of $750 for the two hours meeting on 27 March 2008. Whenever one makes an appointment to meet with a professional advisor to seek advice there will be an implied term that the meeting and the professional advisor’s time will be paid for. It is not usual for this to be expressly stated when the meeting is with an accountant or lawyer. The law presumes that in such commercial relationships there is an intention to be bound in contract and there will be an implied term to pay a reasonable fee. This presumption could be set aside on evidence of a contrary intention by the parties. Mr Carstens gave evidence that when he made the appointment he did not ask whether there would be a charge not did he request that the meeting be free of charge. The letter from Gerard Boundy dated 2 April 2008 indicates that a considerable amount of work had been done by Maxim to understand the issues and to allocate managers to the file. When the invoice was rendered, Envista paid without protest. The Tribunal finds that Maxim was entitled, as a matter of contract, to charge a fee for this meeting and that the fee charged was, in all the circumstances, reasonable for the services of a partner.
The claim for $375 refund
a. Mr Carstens gave evidence that Gerard Boundy had raised the issue of insurance with him and had offered to contact Macquarie bank to set up a meeting. Macquarie Bank had contacted Envista and there had been a conversation relating to insurance. Mr Carstens stated that he had given no instructions to Maxim to arrange or discuss in detail Envista’s insurance needs. Envista had insurance in place and he expected that Gerard Boundy would do no more than make a phone call.
b. The Tribunal had before it the following documents:
i.An invoice (15927) dated 31 October for a total of $4 840, which included a charge of $375 for one hour’s work by Gerard Boundy.
ii.A draft internal bill report from Maxim which covered the period 1 August 2008 to 29 October 2008 and showed that the only item billed against Gerard Boundy was a one hour meeting with Andrew Crawford of Macquarie Bank.
13.There was scant evidence that any meeting had taken place and there was no correspondence or advice from Maxim following the meeting. The only outcome was that Macquarie Bank contacted Envista. Further, on the evidence available to it, the Tribunal finds that it is more likely than not that there was a phone call rather than a meeting and the fee of $4,375 being for one hour is not reasonable. The Tribunal finds that Envista had given no instructions to Mr Boundy to meet with Macquarie Bank, thus they are not contractually obliged to pay the fee.
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Ms J Lennard
Senior Member
PUBLICATION DETAILS
TO BE PUBLISHED
To be completed by Tribunal Staff
PART A FILE NO: XD 09/1611
APPLICANT: ENVISTA PTY LTD
RESPONDENT: PEATCORP PTY LTD T/A
MAXIM CHARTERED ACCOUNTANTS
COUNSEL APPEARING: APPLICANT:
RESPONDENT:
SOLICITORS: APPLICANT:
RESPONDENT:
OTHER: APPLICANT:
RESPONDENT:
TRIBUNAL MEMBER/S: MS J LENNARD, SENIOR MEMBER
DATE/S OF HEARING: 6 April 2010 PLACE: CANBERRA
DATE/S OF DECISION: 6 April 2010 PLACE: CANBERRA
PART B
RECOMMENDATION:
FULL REPORT ( ) CASE NOTE ( ) UNREPORTED DECISION ( )
COMMENTS:
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