Fair Trading Administration Corporation v Smith - [2001] NSWCA 435

CITATION: Fair Trading Administration Corporation v Smith [2001] NSWCA 435

FILE NUMBER(S): CA 41056/00

HEARING DATE(S): 11 September 2001

JUDGMENT DATE:
28 November 2001

PARTIES :

Fair Trading Administration Corporation v Anthony James Smith

JUDGMENT OF: Priestley JA at 1; Powell JA at 26; Fitzgerald AJA at 27

LOWER COURT JURISDICTION : District Court

LOWER COURT
FILE NUMBER(S) : DC 8839/99

LOWER COURT
JUDICIAL OFFICER : Bowden ADCJ

COUNSEL: Appellant - D.L. Williams
Respondent - M. Ashhurst

SOLICITORS: Appellant - Abbott Tout
Respondent - Conditis & Associates

CATCHWORDS: Defective work by building company licensed under Building Services Corporation Act - claim against director of building company - struck out as unmaintanable

LEGISLATION CITED: Building Services Corporation Act 1989
Building Services Corporation Legislation Amendment Act 1996
Building Services Corporation Regulation 1990

CASES CITED:
Demore Constructions Pty Ltd v Garpace Constructions Pty Ltd [2001] NSWCA 350

DECISION: Dismissed with costs.

CA 41056/00

PRIESTLEY JA
POWELL JA
FITZGERALD AJA

Wednesday, 28 November 2001

FAIR TRADING ADMINISTRATION CORPORATION v SMITH

Fair Trading Administration Corporation brings action against both a building company licensed under Building Services Corporation Act 1989 and a director of that company to recover the sum paid by the Corporation to claimants under the Corporations Insurance Scheme because of defective work by the building company – claim against director struck out as unmaintainable in light of s 98 of the act – on application for leave to appeal by the corporation, held, leave granted, but on basis that on proper construction of s 98 Corporation could not succeed against director, appeal dismissed with costs.

ORDERS

Appeal dismissed with costs.

CA 41056/00

PRIESTLEY JA
POWELL JA
FITZGERALD AJA

Wednesday, 28 November 2001

FAIR TRADING ADMINISTRATION CORPORATION v SMITH

1 PRIESTLEY JA:

Fair Trading Administration Corporation (the Corporation) brought an action as plaintiff against Anthony J Smith & Sons (ACN 001 273 749) as first defendant and Mr AJ Smith as second defendant in the District Court. Pursuant to notice of motion by Mr Smith, the action, as against him, was summarily struck out by Bowden ADCJ. The Corporation then sought leave to appeal against the strike out order. In the hearing of the leave application, this court heard argument going both to the application for leave and as on an appeal, so that if the court thought leave should be granted it would be in a position to deal with the appeal without further argument.

2 Although an affidavit by Mr Smith was filed in the District Court in support of his notice of motion, it seems that at the hearing of the motion, it was not read. It became common ground in this court that that was so with the result that in this court the affidavit could not be taken into account. Thus, the proceedings in the District Court became almost the exact equivalent of what used to be called a demurrer, and must be approached in the same way in this court. If the case is an appropriate one…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2001] NSWCA 435
Decision Date: 28 November 2001

CaseChat Overview and Summary

The Fair Trading Administration Corporation (the Corporation) sought to recover damages from Mr. Smith, a director of a building company, for defective work carried out by that company. The Corporation's claim was based on provisions of the *Building Services Corporation Act 1989* (NSW). Mr. Smith applied to have the Corporation's statement of claim struck out as unsustainable. The matter came before the Court of Appeal of New South Wales.

The central legal issue before the Court of Appeal was whether the Corporation could establish a cause of action against Mr. Smith personally for the defective building work undertaken by the company he directed, under the relevant provisions of the *Building Services Corporation Act 1989* (NSW). This involved determining the scope of director liability for the actions of a company in the context of building services.

The Court of Appeal considered the nature of the claim against Mr. Smith and concluded that the legislation did not create a direct cause of action against a director for the company's defective work in the circumstances presented. The Court found that the claim as pleaded was unsustainable, as it did not disclose a cause of action recognised by the law against Mr. Smith in his personal capacity for the company's breaches.

Consequently, the Court of Appeal dismissed the Corporation's appeal and ordered that it pay Mr. Smith's costs.

Orders

Orders of the court

Dismissed with costs.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	Fair Trading Administration Corporation v Smith [2001] NSWCA 435
FILE NUMBER(S):	CA 41056/00
HEARING DATE(S):	11 September 2001
JUDGMENT DATE:	28 November 2001
PARTIES :	Fair Trading Administration Corporation v Anthony James Smith
JUDGMENT OF:	Priestley JA at 1; Powell JA at 26; Fitzgerald AJA at 27

LOWER COURT JURISDICTION :	District Court
LOWER COURT FILE NUMBER(S) :	DC 8839/99
LOWER COURT JUDICIAL OFFICER :	Bowden ADCJ

COUNSEL:	Appellant - D.L. Williams Respondent - M. Ashhurst
SOLICITORS:	Appellant - Abbott Tout Respondent - Conditis & Associates
CATCHWORDS:	Defective work by building company licensed under Building Services Corporation Act - claim against director of building company - struck out as unmaintanable
LEGISLATION CITED:	Building Services Corporation Act 1989 Building Services Corporation Legislation Amendment Act 1996 Building Services Corporation Regulation 1990
CASES CITED:	Demore Constructions Pty Ltd v Garpace Constructions Pty Ltd [2001] NSWCA 350
DECISION:	Dismissed with costs.