Island Industries Pty Limited v Roadstone Construction Limited

[2003] NFSC 5

SUPREME COURT OF NORFOLK ISLAND

Island Industries Pty Limited v Roadstone Construction Limited [2003] NFSC 5

ISLAND INDUSTRIES PTY LIMITED v ROADSTONE CONSTRUCTION LIMITED

SC 5 of 2003

WILCOX J
17 OCTOBER 2003
SYDNEY

IN THE SUPREME COURT
OF NORFOLK ISLAND	SC 5 of 2003

BETWEEN:	ISLAND INDUSTRIES PTY LIMITED PLAINTIFF
AND:	ROADSTONE CONSTRUCTION LIMITED DEFENDANT
JUDGE:	WILCOX J
DATE OF ORDER:	17 OCTOBER 2003
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1.Summary judgment be entered in favour of the plaintiff, Island Industries Pty Limited, in the sum of $78,244.56.

2.The defendant, Roadstone Construction Limited, pay the plaintiff’s costs of the proceeding generally and the application for summary judgment.

IN THE SUPREME COURT
OF NORFOLK ISLAND	SC 5 of 2003

BETWEEN:	ISLAND INDUSTRIES PTY LIMITED PLAINTIFF
AND:	ROADSTONE CONSTRUCTION LIMITED DEFENDANT

JUDGE:	WILCOX J
DATE:	17 OCTOBER 2003
PLACE:	SYDNEY

REASONS FOR JUDGMENT

WILCOX J:

1. This is an application made by the plaintiff, under Order 15 rule 1 of the Rules of the Court, for summary judgment.  The motion for judgment was filed on 3 October 2003.  It seeks an order for summary judgment for the plaintiff in the sum of $78,244.56, together with costs.  Although the originating summons also sought interest, that claim is not now pursued. 

2. The facts of the matter are set out in two affidavits.  The first of those is an affidavit of John Terence Brown dated 3 October 2003.  Mr Brown is a director and shareholder of the plaintiff company, Island Industries Pty Limited (‘Island Industries’), as well as acting as its solicitor in this proceeding.  Mr Brown annexed to his affidavit copies of the filed documents.  He also annexed certain documents created by Edward James Swindells, the representative of the defendant, Roadstone Construction Limited (‘Roadstone’), on Norfolk Island.  The second is an undated affidavit of Mr Swindells.

3. It appears that Island Industries and Roadstone entered into a subcontract of Roadstone’s contract with SMEC Australia Limited (‘SMEC’) for the carrying out of certain construction work on Norfolk Island.

4. On or about 29 April 2003, according to Mr Brown, he received a facsimile from Mr Swindells.  A copy of that document is attached to his affidavit.  It is a typed document setting out an assessment of the claim by Island Industries for the month of April 2003.  The amount assessed as being due is $70,928.56.  Mr Swindells wrote, in his own handwriting, the words: ‘John, I was coming to see you with this.  Please have a look.’

5. In the following month, Mr Swindells supplied to SMEC a schedule of amounts owing to subcontractors under the contract between Roadstone and SMEC.  The amount shown on that document as being due to Island Industries was $78,244.56.  That is the amount claimed in this action. 

6. Another document submitted by Roadstone to SMEC was a schedule of unpaid contractors.  This shows an amount outstanding, to Island Industries, of $3629.00 from the April account and a further $74,615.56 accruing on 20 May 2003.  The total of these amounts is $78, 244.56. 

7. It seems to be clear that Mr Swindells repeatedly represented to SMEC that the amount owing by Roadstone to Island Industries, at least by the end of May 2003, was $78,244.56.  It is common ground that nothing has been paid to Island Industries by Roadstone since that time.

8. This action was commenced on 18 July 2003.  At para 4 of its statement of claim, Island Industries alleges that Roadstone acknowledged its indebtedness on or about 14 May 2003 in the sum of $78,244.56.  In para 5, it is stated that Roadstone is indebted to Island Industries in an amount ‘greatly in excess’ of $78,244.56 but, for the purpose of these proceedings, Island Industries claims that amount.  Paragraph 6 alleges that Roadstone has failed and refused to pay that amount and para 7 contains a claim for that amount together with costs and interest.

9. A defence was filed but it is not very enlightening.  The defence admits the allegations contained in the first three paragraphs of the statement of claim, which go to incorporation and the fact that work was done by Island Industries for Roadstone.  In relation to paras 4-7 inclusive of the statement of claim, the defence simply states that Roadstone denies each paragraph.  I do not think that a defence in that form complies with the requirements of Order 25, rule 1 of the Rules.  Sub-rule (1) of that rule reads:

   ‘A defence to a claim for debt or a liquidated demand shall not merely deny the debt.’

   Sub-rule (2) says:

   ‘A defence to a claim for debt by way of denial shall deny such matters of fact from which the liability of the defendant is alleged to arise as are disputed.’

10. The affidavit of Mr Swindells does not dispute that he provided to SMEC the documents to which Mr Brown drew attention.  However, in para 14 of his affidavit, he said that the documents:

    ‘were not delivered as an admission of indebtedness but rather to assist [Island Industries] formulating its claim under the subcontract so as to facilitate payment under the head contract.  The documents were not final documents and were subject to further revision and deduction if any under the subcontract.’

11. This paragraph is not very informative.  However, it appears from Mr Swindells' affidavit that he apprehends the possibility that Roadstone will be in a position to make a claim against Island Industries, on one or both of two bases.  First, he mentions that there is provision in the subcontract for payment of liquidated damages in respect of any delay caused by Island Industries.  He refers (in para 9) to liquidated damages of $2000 per week but he gives no indication as to the claim for liquidated damages that might exist. There is no information, for example, as to the dates and number of weeks involved, or the cause of the delay.  The second matter to which Mr Swindells refers is a civil suit brought against Roadstone by Mr Tom Meyers, an Island Industries employee who was apparently injured on site.  Mr Swindells seems to foreshadow a claim for indemnity. 

12. In the final paragraph of his affidavit, Mr Swindells says that the statutory declaration of 15 May 2003 was revised by a further statutory declaration of 4 June 2003, ‘following discussions with Environment Australia and in the light of the abovementioned provisions of the subcontract’.  I do not have the further statutory declaration of 4 June 2003. 

13. Mr Wayne Richards, solicitor for Roadstone, was unable to enlighten me about either of the potential cross-claims.  What does seem to be clear is that there is a valid claim by Island Industries, for work done and materials supplied, amounting by late May 2003 to the sum of $78,244.56.  To reach any other conclusion would be to accuse Mr Swindells of having attempted fraud on SMEC.

14. I understand Mr Swindells may have a belief that one or more cross-claims are available to his employer against Island Industries.  There may or may not be justification for such a belief.  However, it seems to be clear that no defence is advanced against Island Industries’ claim, as distinct from an assertion about possible cross-claims.  As Mr Richards acknowledges, the entry of judgment in this matter would not preclude Roadstone from bringing a separate action advancing whatever claim or claims it may have against Island Industries. 

15. It seems to me the filed defence does not comply with the Rules.  Much more importantly, the evidence indicates, beyond any real doubt, that the amount claimed is owing; subject only to the possibility that Roadstone has some independent claim or claims against Island Industries which, in any event, it is entitled to pursue.  The possibility of such a claim or claims is not a reason for refraining from exercising the power conferred on the Court by Order 15 rule 1.

16. I order that summary judgment be entered in favour of Island Industries against Roadstone in the sum of $78,244.56.  I further order that Roadstone pay Island Industries’ costs of the proceeding generally and the application for summary judgment.

I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Wilcox.

Associate:

Dated:            17 October 2003

Counsel for the plaintiff:	Mr M Herschderfer
Solicitor for the plaintiff:	Mr J Brown
Solicitor for the defendant:	Mr W Richards
Date of Hearing:	17 October 2003