Gupta v Construction Services Australia Pty Ltd - [2014] SASC 16

SUPREME COURT OF SOUTH AUSTRALIA
(Magistrates Appeals: Civil)
GUPTA v CONSTRUCTION SERVICES AUSTRALIA PTY LTD
[2014] SASC 16
Judgment of The Honourable Justice Kelly
14 February 2014
MAGISTRATES - APPEAL AND REVIEW - SOUTH AUSTRALIA - APPEAL TO SUPREME COURT
CONTRACTS - BUILDING, ENGINEERING AND RELATED CONTRACTS - THE CONTRACT - GENERALLY
CONTRACTS - BUILDING, ENGINEERING AND RELATED CONTRACTS - PERFORMANCE OF WORK - GENERAL
APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES - INTERFERENCE WITH DISCRETION OF COURT BELOW - IN GENERAL - GENERAL PRINCIPLES - FUNCTIONS OF APPELLATE COURT - GENERALLY
Appeal against judgment dismissing the appellant’s claim for damages – the respondent constructed a house for the appellant – the appellant alleged that he had inspected the display home prior to entering the relevant contract – the appellant claimed the house did not meet the specifications of the display home and that the house contained various defects.
Whether Magistrate overlooked the appellant’s evidence – whether Magistrate correctly applied the provisions of the Building Work Contractors Act 1995 (SA) – whether Magistrate should have relied upon court appointed expert – whether Magistrate should have directed that defects be remedied by the respondent.
Held (dismissing the appeal):
1. I order that the respondent remedy “defect 22” by connecting the rain water tank to the main toilet.
2. In all other respects the appeal is dismissed.
Building Work Contractors Act 1995 (SA) s 31, s 37; Magistrates Court Act 1991 (SA) s 29; Magistrates Court (Civil) Rules 1992 (SA) r 94(5), referred to.

GUPTA v CONSTRUCTION SERVICES AUSTRALIA PTY LTD
[2014] SASC 16
Magistrates Appeal: Civil
KELLY J.
Introduction

The unrepresented appellant Santosh-Kumar Gupta appeals against a judgment of the Magistrates Court dated 7 May 2013 dismissing a claim made by himself and his wife Amita Gupta for damages.
The notice of appeal contains six grounds which raise four main issues for consideration on this appeal. First, whether the Magistrate overlooked the appellant’s evidence, second, whether the Magistrate correctly applied the provisions of the Building Work Contractors Act 1995 (SA) (the Act) in particular s 31, third, whether the Magistrate should have relied on the expert John Robinson and finally whether the Magistrate should have directed that defects either conceded by the respondent or found by the Magistrate should be remedied by the respondent.
Background
In January 2009 the respondent, trading as Hickinbotham Homes, agreed to build a single story dwelling at Lot 501 Trafford Street, Mansfield Park, South Australia (the house). The written and signed “Building Agreement” dated 31 January 2009 is comprised of various documents, including a signed document containing 13 Schedules, a signed “Specification” document, a signed “Classic Schedule”, and a colour selection schedule signed and dated 28 May 2009.
On 26 March 2010, the respondent handed over the house to the appellant. The appellant did not consider that the house was constructed according to the specifications of the ‘Watson’ display home which he said he had previously inspected. The appellant also informed the respondent of what he believed to be a number of defects. The respondent rectified some but not all of the stated defects and, on 7 September 2011, the appellant filed a claim in the Magistrates Court.
The first ground for that claim was that the respondent breached s 31 of the Act because the house did not conform to the specifications and standards of the Watson display home. The second ground was that the respondent is liable for rectification work of defects referred to in Appendix A attached to the appellant’s claim.
It is convenient to summarise the relevant evidence led at trial in respect of which the Magistrate made findings.
In support of his claim that the respondent knew he had inspected the Watson display home at Mawson Lakes on 31 January 2009, prior to signing the contract, the appellant led evidence in the form of a video recording and a still image of the recording which depicted the Watson display home. It was said that an individual in the video recording and still image was Hickenbotham sales consultant, Ms Li. For the respondent, Ms Li testified that though she recognised herself in the photograph, she had no recollection of that day and according to her roster she did not work at Mawson Lakes on 31 January 2009. She also testified that she did not recognise Mr Gupta. The Hickenbotham representative in charge of negotiations and contract finalisation, Mr Booth, also testified for the respondent. He stated that at no stage was he aware that the plaintiffs had attended the display home, nor that they were relying on the display home during negotiations or at the time of signing the contract. He also testified that though part of the house was based on the Watson design, the plaintiffs sought to build a house substantially different to the Watson.
A court appointed building expert, Mr Robinson, inspected the house and prepared two reports dated 29 February 2012 and 23 March 2012 which dealt with the alleged defects. The appellant tendered an expert report by a civil engineer, Mr Clarke in support of his claim for damages for rectification work of the defects. The respondent called Hickenbotham Homes construction manager, Mr Swinden, who also testified in relation to some of the alleged defects.
Discussion
Section 31 of the Act (grounds 1, 2 and 3)
The first three grounds of appeal raise the issue of whether or not s 31 of the Act has any application to the agreement reached between the parties.
Section 31 of the Act states:
31—Exhibition houses
(1)If a house is, or has been, made available for inspection by the public with a view to inducing persons to enter into contracts with a building work contractor for the construction of similar houses—
(a) the contractor must, on request by a person inspecting the house, make copies of the plans and specifications of the house available for inspection by the person; and
(b) a contract entered into with the contractor by a person who, to the knowledge of the contractor, inspected the house and sought the construction of a similar house is to be taken to contain a warranty that the house to be constructed by the contractor will be constructed according to the same plans and specifications and to the same standards of work and materials as those of the house inspected by the person (except to the extent that the contract specifically provides for any departure from those plans, specifications and standards).
(2)A building work contractor who fails to comply with the requirements of subsection (1)(a) is guilty of an offence.
Maximum penalty: $5 000.
Expiation fee: $160.
In order to determine whether s 31 had any application the Magistrate needed to resolve whether the respondent knew that the appellant had inspected the Watson display home at Mawson Lakes. In the event that the respondent was proved to have the requisite knowledge, the question which then arose was whether the contract was to build a “similar house” within the meaning of s 31.
The resolution of the first question namely whether the respondent was aware that the appellant had inspected the display home at Mawson Lakes, depended to a large extent on the Magistrate’s assessment of the credit of the main witnesses who gave evidence on that topic, namely the appellant and Mrs Gupta, Mr Booth the respondent’s representative responsible for negotiating the contract with the appellant, and Ms Li the respondent’s representative at the Watson display home on 31 January 2009, when it was allegedly inspected by the appellant and Mrs Gupta.
Whether or not the parties contracted to build a house similar to the display home was largely a matter of interpretation of the contract, in particular clause 29 and the Eleventh Schedule attached to the contract. Whether or not the house built was in fact a similar house to the display home was largely a question of fact.
The Magistrate’s reasons for concluding that the respondent was unaware that the appellant had inspected the Watson display home were extensive. Contrary to the appellant’s assertion that the Magistrate overlooked the evidence of himself and his wife, his Honour addressed the evidence of each of the relevant witnesses on this topic namely Ms Li, Mr Booth and the appellant who tendered the video allegedly taken during the attendance at the Watson display home at 31 January 2009.
The Magistrate’s reasons for accepting the evidence of Mr Booth and Ms Li are clear. Although the witness Mr Booth demonstrated a complete lack of understanding of the importance of proper protocols surrounding the execution of a document such as a contract, virtually conceding that he had appended his signature to the document before it was signed by the appellant, nevertheless Mr Booth was frank and forthright. He displayed no tendency to prevaricate or to evade questions or to embellish the truth.
The evidence of Mr Booth was compelling, particularly in relation to the protocols that would need to be engaged if a client did advise that they had been to a display home. The Magistrate’s findings on this topic were largely based on credit although, as the Magistrate himself noted, the documentary evidence tendered at the trial, namely the said contract, the plans and specifications did support the respondent’s position that it was never made aware of the appellant’s attendance at the Mawson Lakes display home.
It is unsurprising that the Magistrate concluded that the evidence of Mr Booth and Ms Li was more reliable on that topic. Moreover, as the Magistrate himself noted, the appellant did not introduce himself to the agent on the day he said he was at the Watson display home. Even given Mr Booth’s apparent insouciance about the proper procedures for witnessing documents, he was a patently honest witness and as the Magistrate observed, the documentary evidence supported his account of the conversation.
In any event, the Magistrate was correct to find that even if the appellant had established knowledge on the part of the respondent, the design of the house which the parties eventually contracted to build deviated in so many respects from the Watson design that it could never be described as a “similar house” to the Watson house. His Honour stated:
When one considers that there are two extra bedrooms, one extra bathroom, an extra kitchen and an additional rumpus room, it is apparent that substantial modifications have been made to the Watson design. This in itself would suggest that the plan agreed to by the plaintiffs could not be described as similar.
The appellant attempted to overcome that finding by submitting that in fact the contract was to build two homes, one being similar to the Watson design and the second one comprising the substantial additions and extras. The appellant’s reliance upon the definition of ‘building’ in the Act in support of his argument that the parties contracted to build two homes does not advance his claim.
Clause 29 of the contract states as follows:
The builder acknowledges that it has been informed by the owner that the owner has inspected the builder’s display home more particularly described in the Eleventh Schedule hereto. The owner acknowledges that the said plans and specifications in respect of the said works differ from the plans and specifications of the display home to the extents set out in the Eleventh Schedule accept in respect of any item which is contained in the Eleventh Schedule and which is expressly included in the said plans or in part C of the said specification. …
The Eleventh Schedule in this case remained blank. Apart from the heading which appears to be from a template, it contained no further entries:
ELEVENTH SCHEDULE
(Departures from Display Home Plans & Specifications – Clause 29)
If applicable, refer to attached schedule. (Delete if not required).
It may well have been better had the respondent drawn a line through the Eleventh Schedule as indeed appears to have been done elsewhere in the contract in relation to other irrelevant provisions. Nevertheless, I agree with the Magistrate’s conclusion that the only sensible interpretation of clause 29 in conjunction with the blank space under the Eleventh Schedule is that clause 29 in the circumstances was not operative because the builder was never informed that the appellant had been to the display home.
As a matter of plain common sense, if clause 29 was relevant the name of the display home with all of the modifications allegedly agreed to would have been clearly set out in the Eleventh Schedule. In this respect Mr Booth gave evidence about the procedure that would have inevitably been invoked in those circumstances.
In summary, the Magistrate gave extensive reasons for his findings on this important topic. Those findings depended to a substantial extent on findings of credit about the three witnesses Mr Booth, Ms Li and the appellant. His Honour’s findings were open on the evidence. The appellant has not established that the Magistrate made any error of law in his interpretation of s 31 of the Act or clause 29 of the contract.
The Magistrate’s reliance on the court appointed expert Mr Robinson (ground 4)
This ground of appeal raises the issue whether the Magistrate should have relied on the evidence of the court appointed expert Mr Robinson.
Section 29 of the Magistrates Court Act 1991 (SA) (Magistrates Court Act) empowers the court to refer any question arising in an action for investigation and report by an expert in the relevant field. The court is entitled to adopt a report obtained under that section in whole or in part. By r 94(5) of the Magistrates Court (Civil) Rules 1992 (SA) the court may sit with the expert and exercising the power under s 29 of the Magistrates Court Act may at and during the trial refer any question of a technical nature for immediate or reserved investigation and report by the expert. That is in fact what happened in this case. Mr Robinson was appointed by the court. He prepared two reports having inspected the site on 22 February 2012. That inspection was attended by the appellant and a representative of the respondent. Mr Robinson sat with the Magistrate, and partook at important points during the trial, particularly when the appellant’s expert Mr Clarke gave evidence.
The appellant’s complaint about the Magistrate’s reliance on Mr Robinson’s report might be more accurately described as a complaint about the Magistrate’s preference for those reports over that of the appellant’s expert Mr Clarke.
Importantly Mr Clarke was called to give evidence and was cross-examined on those aspects of his report which differed from Mr Robinson. Mr Robinson was also present during those proceedings and the Magistrate was entitled at the end of the evidence to assess the contribution made by both Mr Clarke and Mr Robinson and make up his own mind.
In his reasons for judgment the Magistrate addressed each and every one of the matters about which the appellant complains in making the submission that he should have accepted Mr Clarke’s opinion in preference to Mr Robinson.
Some of the differences of opinion between the two experts Mr Robinson and Mr Clarke boiled down to such factually minute matters as to the width of the gap between the facia and the eaves on the gutters sufficient to comply with the Australian Standard. The evidence on this topic was extensive. In the end the Magistrate accepted the report and comments of Mr Robinson in preference to Mr Clarke’s evidence. In my view it has not been established that the Magistrate made any error of fact or law in his approach to this or any of the other issues in contention under the heading of defects.
This ground of appeal is not made out.
The Magistrate’s order that the respondent carry out remedial works (ground 5)
The appellant complained that the work performed by the respondent was dubious and some of the works carried out were so substandard the Magistrate should have ordered the respondent to compensate the appellant for the cost of remediation in lieu of ordering the respondent to carry out the remedial works itself.
In my view there is no substance in this submission. The building contract itself by virtue of clause 15.1 and 16.2 provides that the respondent must be given an opportunity to remedy the defects in the first place. Even if the appellant had been successful in the claim under the Act the court is empowered by virtue of s 37 of that Act to require the contractor to carry out the remedial work. The court can only order compensation in lieu of remedial work if the court is of the opinion that the person is not likely to perform the remedial work properly.
I am not persuaded that the evidence supports the appellant’s submission that the works performed by the respondent were carried out so negligently or of such a substandard that the respondent should not be permitted to perform the remedial work. The trial Judge correctly concluded that it was for the respondent to remedy previously conceded defects.
In relation to the alleged defects there is only one matter in respect of which I take a different view to that of the Magistrate. It relates to alleged defect 22 being the complaint that the rain water tank was not connected to the main toilet in accordance with the plans.
The Magistrate found and there was no dispute that the respondent had plumbed the rain water tank to the rear toilet because that was where the electrical connection was. The appellant made a claim for losses sustained by having the rain water tank plumbed to the rear toilet and not the main toilet, given that additional mains water was thus required. The Magistrate said he was not satisfied that that claim had been proved or that any loss had resulted. However the sketch plan plainly provides for the rain water tank to be plumbed to the main toilet. There was no dispute as to which constituted the main and rear toilet respectively. In these circumstances it is a plain term of the contract that the respondent undertook to plumb the rain water tank to the main toilet. It was not. The loss to the appellant in my view is obviously the difference between the amount of mains water utilised as a result of the failure to plumb the rain water tank to the main toilet.
As the contract clearly stated that the respondent was responsible to plumb the rain water tank to the main toilet it is only reasonable in my view that it should do so.
This is the only matter in respect of which I take a different view of the alleged defects than that taken by the Magistrate.
The failure of the Magistrate to allow the appellant to amend his pleadings during the trial (ground 6)
Well after the evidence was completed and after closing submissions had been made the appellant sought to file further submissions raising new claims based on unconscionability and reliance upon various sections of the Act.
The Magistrate refused permission to the appellant to amend the claim at that stage finding they were foredoomed to failure and that in any event the amendments at that stage would needlessly prolong what the Magistrate determined to be an unwinnable case.
I am mindful of the fact that the appellant has been unrepresented both at trial and on this appeal. However, in my view the Magistrate was correct to reject the application to raise new issues at such a late stage of the trial.

This was a summary trial and the appellant raised numerous issues during the hearing of the trial all related to the alleged defective works carried out by the respondent. The trial went for four days. It is plain from the transcript that the Magistrate was at pains to allow the appellant full reign in conducting his case while at the same time attempting to head off and forestall digressions into irrelevant areas not raised before on the pleadings. This happened frequently during the trial. On more than one occasion the Magistrate refused permission for the appellant to launch another side issue not already raised on the pleadings. Nevertheless the appellant was able to present evidence in respect of each and every one of the alleged defects and the expert retained by the court provided a report in respect of each and every one of the alleged defects. I am satisfied that the appellant was given a fair hearing.
Whether or not to permit amendments to pleadings is very much a matter for the discretion of the court. In a case such as this it was essential to bring to finality the appellants’ lengthy and somewhat prolix claims. The Magistrate was correct to confine the appellants to the issues raised on the pleadings.
The appellant has not established any basis on which he may have succeeded on any proposed alternative claim.
Conclusion
Apart from the issue in relation to defect 22 in respect of which I order that the respondent be given the opportunity to remedy the defect by connecting the rain water tank to the main toilet, the appeal is in all other respects dismissed.