Incon Pty Ltd v Grandal Nominees Pty Ltd No. DCCIV-99-1469
[2001] SADC 38
•21 March 2001
Incon Pty Ltd v Grandal Nominees Pty Ltd
[2001] SADC 38
His Honour Judge David
Civil Jurisdiction
The defendant in this action was a duly incorporated company which owned a property at 250‑256 Flinders Street, Adelaide and leased out that property to tenants. One of its tenants was the original plaintiff in this action, Express Colour Pty Ltd, which was a company involved in commercial colour reproduction.
On Sunday the 18th May 1997 the roof of the premises leaked during a storm. As a result water flooded into that part of the premises occupied by the original plaintiff causing damage to its equipment. The plaintiff’s claim against the defendant has been settled and judgment entered for the plaintiff. The present action is as a result of a third party notice being issued by the defendant against the third party, Grandal Nominees Pty Ltd.
The third party at all material times was a body corporate carrying on business in South Australia as roofing contractors. The claim against the third party originally was that in May of 1996, pursuant to a quotation in writing, the third party agreed to do certain repairs on the guttering of the roof of the premises. It was originally claimed that that work was done in such a way and by the use of such bad practice that the capacity of the gutters was reduced and that reduction substantially contributed to the damage caused to the plaintiff. However as the evidence unfolded and particularly after the evidence of the defendant’s witness, Adrian Winzer, it was conceded by the defendant that the repair work done in 1996 could no longer be a basis of liability (transcript page 178).
The defendant’s claim revolves around events which took place about a fortnight before the day of the storm, namely the 18th May 1997. It is based on a number of conversations that a Mr O’Brien, one of the Directors of the defendant company, had with the foreman of the third party’s company. The defendant alleges that on being told by the plaintiff that water had entered the premises on the weekend of the 3rd and 4th May 1997 he contacted a Mr Grandal and told him there was a problem of water entering the premises and asked him to come out and fix it. This was on about the 5th May 1997. He was told by a member of the plaintiff’s company that nobody had come out to fix the problem. He telephoned the third party again on the 7th May. On both occasions it is the defendant’s case that the third party agreed to come out and fix the problem. The defendant and the third party were familiar with each other because the third party had done work for the defendant in 1996. The defendant’s case is that no one from the third party came out to fix the problem and that some two weeks later there was a storm which caused the damage which was the subject of the plaintiff’s claim.
The basis of the defendant’s claim was that there was a breach of contract. The contract was that the third party agreed to come out to inspect the problem and at the very least to ascertain what the problem was and it was implied that he would fix it. In not coming out as he promised there was a breach of that contract causing the damage.
After the damage had been caused by the storm of the 18th May it is alleged by the defendant, and not disputed, that the third party on being contacted did come out to the premises and removed a large number of leaves from the gutter. There was no dispute that that was the problem which caused the leaking and the damage. It is the defendant’s case that if the third party had come out at the time of the original phone calls on the 5th and the 7th May 1997 they would have seen those leaves and therefore identified the problem and fixed it accordingly. It is argued that therefore there would have been no damage caused by the storm which took place some two weeks later.
The third party’s defence is that the phone calls of the 5th and 7th May simply did not take place. It is the third party’s case that they were not contacted to come out either on the 5th or the 7th May 1997 and were only contacted after the storm. They then came out and fixed the problem but of course that was too late. It is agreed by both sides that the primary question of fact that has to be resolved is whether it has been proved that in fact these conversations took place. If it has not been proved then the defendant’s claim against the third party fails. If it has been proved they did take place then the defendant has to satisfy me that those conversations form the basis of a contract which has been breached thus causing damage. Alternatively they argue that if these conversations are proved to have taken place and I find that there was not a contract formed it would nevertheless be an action in negligence because there would be a duty of care owed to the defendant because of this arrangement being made for the third party to come out and inspect the gutter. Both heads of liability, it is agreed, depend upon the existence of the conversations of the 5th and the 7th May 1997 whereby the defendant alleges the third party promised to come out and inspect the roof. I now turn to that question.
The Defendant’s Case
The defendant called two Directors of its company, a Mr Tasker and a Mr O’Brien, a roofing supervisor Adrian Winzer and an insurance adjustor Wayne Klenner. Both the Directors gave evidence of the area that is not now being pursued namely the fact that in 1996 the third party was contracted to and did certain work on the roof. Because of the evidence of Mr Winzer, the details of which I do not now need to go into, there is no connection between that work and the damage caused on the 18th May 1997.
Mr Tasker gave evidence that the guttering was checked about every four months. He gave evidence that in early May of 1997 one of his tenants (the plaintiff) reported there was a leak coming through the roof and that could be seen by staining in the ceiling. According to Mr Tasker it was agreed to contact the Grandals and that was left to the other Director, Simon O’Brien. Mr Tasker gave evidence that it was Simon O’Brien who handled all of the communications about the water staining to the roof and took on the job of getting it fixed.
Simon O’Brien, who was also a Director of the defendant company, also gave evidence. He said that he heard of the water staining to the ceiling on the Monday of the weekend that that was discovered. He then gave evidence that he phoned Grandals to come and check the roof and to find out the cause and fix it. He gave evidence that they had previously done work on the roof about a year before. He gave evidence that as best he can remember he phoned a mobile number and spoke to Willie Grandal Jnr. He got this number from a business card. His evidence of that conversation was as follows (transcript pp 84-87):-
"Q.... You said you rang. When you rang, what did you say. When I ask you what was said on any occasion, I want you to relay to us, as best you can, word for word, what the conversation was. If you are not in a position to do that, say so.
A...... I am not sure I can do it, word for word. It was words to the effect, could they come round and please check, obviously something wrong with the roof, could they come round immediately that day, because the weather, it was still threatening and we needed to have whatever it was fixed.
Q...... What day did this conversation occur.
A...... I believe it was on the Monday. The day that Grant Jarrett told us was the day I phoned.
Q...... Did you make any entries in your diary relating to any of this.
A...... There is an entry in terms of making a phone call to Grandals.
Q...... I now produce to you, pages from your diary from 1997, for 5th, 6th and 7 May. I ask you to direct your attention to the diary of 5 May. Do you see a note there relevant to this conversation.
A...... I haven’t got my glasses. My apologies. ‘Express roof’ I think it is.
Q...... That appears opposite about 1.30 or 2 o’clock.
A...... That column doesn’t have any bearing to the time of day. That is a ‘to do’ list. It’s just written in order of me thinking of things to do. Obviously that was the reference that I made, as soon as I had the conversation. I couldn’t tell you what time of day it was.
Q...... Is there a tick to the right of that entry, as there are with all of them. Is that tick of any significance.
A...... Yes, it is my little code as to whether I have done it or not.
Q...... You told us that you telephoned -
HIS HONOUR Are you going to tender that?
MR HARMS: I was going to wait until I got to 7 May and tender it as a bundle.
XN
Q...... You told us that you rang on 5 May, what was the response of the person you spoke to.
A...... It was ‘Yes, we will come as soon as we can’.
Q...... Did anyone come out.
A...... Not as it transpired, no.
Q...... In the course of this conversation, had you actually described what had occurred.
A...... I just said there was a significant leak in the roof at 256 and could they come and look at it.
Q...... Did you follow that up.
A...... I did on the Wednesday.
Q...... What happened on the Wednesday.
A...... I had cause to see Graham Jarrett, because he’s a supplier of ours. He comes into the office regularly. I asked him if the roof had been fixed, if something had happened.
Q...... Can you pause there for a moment. Who’s Graham Jarrett.
A...... He’s the proprietor of Express Colour.
Q...... Yes, continue.
A...... He then said he wasn’t aware of anything happening, that he hadn’t seen anybody on the roof. That wasn’t to say, necessarily, that it hadn’t happened, so he couldn’t answer the question.
Q...... So did you do anything as a consequence of that.
A...... Yes, I phoned Grandals again on the Wednesday, to ask whether they had indeed been, and what had happened.
Q...... You say you rang Grandals again. What number did you ring.
A...... The same number on the business card.
Q...... Who did you speak to.
A...... I believe I spoke to Willie Grandal Junior.
Q...... Did it sound like the same person you spoke to on Monday, or not.
A...... I can’t recall thinking it was somebody different, so I would have to say, yes.
Q...... When you rang, what did you say.
A...... I asked if Grandals had attended on the Monday.
Q...... What answer did you get.
A...... I was told that, no, they hadn’t, so I then insisted that they come round immediately to tend to the problem.
Q...... Did they agree to do so.
OBJECTION: MR HOWARD OBJECTS.
HIS HONOUR: That is all right.
OBJECTION OVERRULED
XNQ...... Did whoever you were speaking to, agree to do so.
A...... Yes.
Q...... Did you make any note in your diary about that discussion, or relevant to that discussion.
A...... Not to the discussion, but I see there’s ‘Willie the roofman’ to phone.
Q...... That appears at the top of the list on May 7th.
A...... Correct.
Q...... Again, does the tick have any significance to the right‑hand side of it.
A...... The tick means I made the call.
EXHIBIT #P6 PAGES OF DIARY TENDERED BY MR HARMS. ADMITTED.
Q...... Was there any discussion about price, in the course of either of those discussions.
A...... No.
Q...... Was there any reference made, in the course of the discussions, to the previous work that they had done.
A...... Not that I recall.
Q...... Following that discussion, are you aware of anyone having come out.
A...... I am certainly not aware of that. I didn’t see anybody come out. But I am led to believe somebody did come to the office.”
I have set that conversation out in full because of course it is the basis of the defendant’s claim against the third party. Mr O’Brien then went on to give evidence of the major downpour that occurred about two weeks later. He said that from the time he made the calls to Willie Grandal Jnr until the time of the downpour he had done nothing to follow the problem up. He said he did not get any account for any work being done and he would have expected to do have received such an account if the work had been done. He then gave further evidence that on the Monday following the downpour he spoke to a person at Grandals and asked them to attend as a matter of urgency. He said they attended but he did not know who attended and he was not present when it happened and he did not receive an account for the work they did on that occasion.
It was put in cross-examination that the diary note of the 5th May was simply a note to do something about the express roof leak. It was from that cursory note, it is put, that he recalls that he made the phone call to Willie Grandal Jnr. Mr O’Brien denied that that was his sole reason for saying that he made that phone call and indeed was adamant that he had an independent memory of making it. When cross-examined on his memory of that first conversation on the 5th May it is clear, as one would expect, that there is very little precision about his memory of the conversation and indeed an amount of reconstruction was obvious as can be shown by the following exchange (transcript p94):-
"Q.... What did you say.
A...... I can’t tell you precisely what I said, but I would have said ‘I’m Simon O’Brien from Limelight. We have a roof leak. Can you come and check it out and fix it for us, please?’
Q...... Do you think you were as explicit as that.
A...... I would have thought I would have been, yes.”
There was similar uncertainty when he was cross-examined about his conversation on the 7th May. The following evidence is an example of that uncertainty” (transcript p95):-
"Q.... So you said ‘It is Simon O’Brien here. That is Willie Grandal’. That is how it went.
A...... I imagine so.
Q...... And ‘Have you been to look at our roof leak yet?’ Answer ‘No’. Is that how it went.
A...... Something like that.
Q...... And at that point you got angry.
A...... Yes.
Q...... Tell me what else was said, please.
A...... I can’t tell you what I might have said in the minor heat of the moment, but I made it clear that I had expected them to have been and done the job, and that they had not, and would they please get round there very quickly. I was a little more vocal than that.
Q...... What was the response.
A...... That they would come round.
Q...... Any time fixed.
A...... No.”
It was put in cross-examination that neither of those conversations took place. That was denied. It was also put that there was no conversation between he and either of the Grandals on the 20th May but instead he instructed a receptionist or a member of his female staff to contact them. He said he could not recall doing that.
The defendant also called Wayne Ronald Klenner who is an insurance adjustor with the firm of Robertson & Co. He was instructed by the public liability insurer of Incon Pty Ltd in relation to the water damage which resulted from the storm on the 17th May 1997. He gave evidence that he phoned Grandal roofing and spoke to Willie Grandal Jnr, having been put onto him by his father. He spoke to Willie Grandal Jnr on the 15th September and the gist of the conversation included an admission by Willie Grandal Jnr that he went to the defendant’s premises as soon as he was called but could not see anybody on the first day because they were in a meeting. The evidence of Mr Klenner I found to be totally unsatisfactory. I do not wish to set it out in detail except to say that his note taking and his memory were totally confused. His notes were cursory to say the least and he now of course cannot remember details of the conversations. I indicate that I cannot rely upon his evidence due to its vagueness and imprecision to say that it has been proved that Willie Grandal Jnr admitted to him that he had been to the defendant’s premises and left because the client was out. On the defendant’s case I am therefore left solely with the evidence of Mr O’Brien as to whether the conversations in question took place. I turn to the case of the third party.
The Third Party’s Case
The third party called two witnesses Willie Grandal and his son Willie Grandal Jnr. Willie Grandal is the only Director of the third party company and he employs his son, Willie Jnr, as his foreman. He gave evidence that they both worked on the defendant’s roof in 1996. He himself did not receive any phone calls from Mr Simon O’Brien in May of 1997. However he received a phone call during that month from a female who told him that they had had a bad leak at their premises (the defendant’s premises). This phone call was received at about 9.00 a.m. in the morning and his son went down there. His son reported back that he and another person had cleared out about 4 or 5 plastic bucket containers of leaves and that was the problem. There was a discussion between he and his son about whether an account should be sent. It was decided against sending one. The reason was that the work had only lasted about one hour. Business sense and goodwill indicated that an account should not be sent.
Willie Grandal Jnr gave evidence about the work done in 1996 on the defendant’s roof. As has been indicated that work is now not the basis of any part of the claim. He gave evidence that in May of 1997 he remembers being called by his father to drop in and have a look at a leak at the premises of the defendant. He said that he got up on the roof and noticed that all the leaves from a big tree had blown onto the roof and washed down to the gutter and blocked it. He said that he went down after initially getting on the roof to speak to the receptionist and was told that “Bruce or Simon” were at a meeting. He then told the receptionist that he would fix the problem. He then got back on the roof and removed a quantity of leaves which in fact did fix the problem. He denied being contacted by Mr O’Brien by telephone on the 5th May. He also denied being contacted by Mr O’Brien on the 7th of May. I set out his evidence on that topic (transcript pp141-146):-
"Q.... Mr O’Brien has given evidence that about a little over two weeks before the day when you went there and removed the leaves he’d telephoned you - he gives the date as 5 May - he telephoned you on your mobile and asked you to go to the premises because there was a problem with a leak. Do you recall any conversation on the mobile phone with Mr O’Brien on about 5 May.
A...... No, I can’t recall that, no.
Q...... Did he speak to you on the telephone on about 5 May, on your mobile phone.
A...... Not that I can remember, no.
Q...... He says that in that conversation you said to him word to this effect, ‘Yes, we’ll come as soon as we can’. Did you have a conversation about the roof using those words.
A...... Not that I recall, no.
Q...... He says that a couple of days later on 7 May he rang you on the mobile phone again and asked whether you had been to the premises.
A...... No, I can’t recall him ringing me.
Q...... Just going back a step, when you say you can’t recall are you saying that you don’t remember any conversation to that effect or that no such conversation took place.
A...... I can’t remember talking to him about going there. Normally everything I - if I was asked to go places it would always go through dad because I would already be on a job somewhere. I didn’t make up my own schedule.
Q...... Mr O’Brien has given evidence that he telephoned you on your mobile and that he’d got the number from a business card that you provided.
A...... I can’t remember giving him a business card, but I may have, I’m not 100% sure.
Q...... While you were working on the site in 1996 would you have had the firm’s business cards with you.
A...... Yes, I normally carry some cards with me.
Q...... Was your mobile phone number on the business card at that time, that’s 1996.
A...... No.
HIS HONOUR
Q...... Have you got a copy of that business card so that we can have a look at it.
A...... No, I haven’t got one on me here.
Q...... Have you got some somewhere.
A...... I’ll grab one somewhere, yes.
XN
Q...... Do you have any practice in relation to providing your mobile phone number if you are handing out a business card to someone that you are doing work for.
A...... Not normally, I may have.
Q...... May have what.
A...... I may have written it on there, I’m not 100% sure.
HIS HONOUR
Q...... So what you are saying is the business card didn’t have your mobile number printed on it but there is a practice where you might your mobile number on the business card.
A...... Yes.
BUSINESS CARD PRODUCED TO MR HOWARD
XNQ...... Looking at the business card that I produce to you, do you recognise that as one of the firm’s business cards.
A...... Yes, that’s the business cards we had back then, yes.
Q...... Is your mobile phone number on it.
A...... No.
Q...... What telephone numbers are on it.
A...... The first number is dad’s home number, the second number is my home number, and the mobile number is dad’s old mobile number.
Q...... Was that the number that your father had in 1996.
A...... Yes.
Q...... Looking on the reverse of the card I think that’s got some writing on it which is quite irrelevant.
A...... Yes, that’s nothing.
......... EXHIBIT #D7 BUSINESS CARD TENDERED BY MR HOWARD. ADMITTED.
Q...... Going back to May of 1997, Mr O’Brien has given evidence that on 7 May he telephoned you on your mobile and spoke to you and in the course of that conversation asked you if you had attended at his offices as requested a couple of days earlier. Did you have any conversation on 7 May ’97 with Mr O’Brien on that topic.
A...... I can’t really remember about that conversation. I may have. I can’t really say for sure.
Q...... He says that on that day he insisted that you come to the office that day.
A...... I couldn’t recall it, sorry.
Q...... He says that you said yes, you would come.
A...... I can’t recall saying that.
Q...... Did your firm in 1997 have a practice in relation to responding to requests to attend and inspect leaking roofs.
A...... Normally any job I do if I get rung up afterwards and it’s leaking I will attend it because I don’t like my jobs leaking.
Q...... When you say ‘my job’, how did you regard the job which was done at Flinders Street in 1996.
A...... The sections that we replaced totally, like I’d say no worries at all, but obviously when you do things a cheaper way I don’t think it would have any problems with the leaking if there were no leaves in the gutter.
Q...... I didn’t make the thrust of my question clear. What kinds of jobs did you regard as your jobs, when you use the phrase ‘my job’.
A...... Whatever we’ve actually done there, you know. If I’ve done something there that’s some part of my job.
Q...... In this period of time ’96, ’97 did you work on every job that the firm had done.
A...... Pretty well, yes.
Q...... If you were contacted direct by a person for whom you’d done some roofing work, when I say ‘contacted direct’ I mean contacted directly on your mobile phone, not through your father, if there was concern about a leaking roof what was your practise.
A...... I would definitely attend if I could go there.
Q...... How quickly would you go to the job.
A...... Normally on the way home from work, when we’re packed up from the other job.
Q...... And if you weren’t able to go there what would you do.
A...... I’d either ring dad and see if he could go there if we were too far away. Normally just depending - I’d normally make provisions to be able to go there.
Q...... If Mr O’Brien had rung you first of all on 5 May 1997 and said words to the effect of we’ve got a problem with a leak on the roof at either Express Colour or 256 Flinders Street can you have a look at it today, or can you come immediately, what would you have done.
A...... I wouldn’t normally just come immediately because I’d be working on a job site somewhere, but I would normally like come after work, yes, on the way home.
Q...... Taking you back to the conversation that Mr O’Brien says took place on 7 May. He says that on that occasion after he had asked you if you had already been to the premises that he got angry and insisted that you come and look at the premises that day. Do you remember any conversation to that effect.
A...... I can never remember anyone being angry at me on the phone or anything.
Q...... Is that something that you believe he would remember had it occurred.
A...... Definitely.
Q...... If he had been angry in a second conversation with you, what would you have done.
A...... Well, if someone rang me up angry, I’d definitely make it a point to go there. If it’s something that’s not my fault - if it’s my fault that the roof’s leaking I’d understand that they could be angry, but I’d like them not to be angry with me if it wasn’t my fault.”
Mr Willie Grandal Jnr was extensively and thoroughly cross-examined and I observed him very closely. Despite his way of denying the fact that these conversations took place by referring continually to the fact that he could not remember those conversations I nevertheless prefer his evidence on that topic to that of Mr O’Brien. Although the evidence of both Willie Grandal Jnr and Simon O’Brien was vague in many areas I accept the evidence of Willie Grandal Jnr that if such phone calls had taken place on the 5th and the 7th May 1997 he would both have remembered those conversations and attended accordingly. I find that the cursory note in the diary of Simon O’Brien does not make up for the vagueness of his evidence concerning the details of the conversations. I am of the view that he has genuinely been confused about what happened when the Grandals were contacted on the 17th May and the so called conversations that took place on the 5th and the 7th May 1997. I find that it has not been proved those conversations took place.
As those conversations are the basis of the claim of the defendant it follows the defendant’s claim against the third party must fail. It is unnecessary for me to decide that if these conversations did take place whether they were certain enough to form the basis of any contractual obligation or if there was a duty of care owed by the third party to the defendant merely because they rang him and asked him to come and have a look at the roof.
There will therefore be judgment for the third party against the defendant.
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