Jezer Construction Group Pty Ltd v R E Spence and Co Pty Ltd
[2005] QDC 16
•17 February 2005
DISTRICT COURT OF QUEENSLAND
CITATION:
Jezer Construction Group Pty Ltd v R E Spence & Co Pty Ltd [2005] QDC 016
PARTIES:
JEZER CONSTRUCTION GROUP PTY LTD
Appellant
v
R E SPENCE & CO PTY LTD
Respondent
FILE NO/S:
BD4151/2004
DIVISION:
PROCEEDING:
Application for leave to appeal
ORIGINATING COURT:
Commercial and Consumer Tribunal
DELIVERED ON:
17 February 2005
DELIVERED AT:
Brisbane
HEARING DATE:
4 February 2005
JUDGE:
McGill DCJ
ORDER:
Leave to appeal refused. Order the appellant to pay the respondent’s costs of the proceeding including reserved costs to be assessed.
CATCHWORDS:
BUILDING AND ENGINEERING CONTRACTS – Recovery of moneys – whether payment by proprietor discharged debt of contractor to subcontractor
INFERIOR TRIBUNALS – Commercial and Consumer Tribunal – whether to grant leave to appeal – question of fact – appeal apparently hopeless – small amount – leave refused.
Commercial and Consumer Tribunal Act 2003 s 100.
COUNSEL:
D W Edwards (clerk) by leave for the appellant
M Fisher (solicitor) for the respondentSOLICITORS:
Toogoods solicitors for the appellant
S J Gurnsey & Company solicitors for the respondent.
This is an application for leave to appeal from a decision of the Commercial and Consumer Tribunal given on 21 October 2004. By s 100 of the Commercial and Consumer Tribunal Act 2003 there is an appeal to this court with the court’s leave only on the ground of error of law, or excess or want of jurisdiction. In the present case there is no allegation of excess, or want, or jurisdiction.
The notice of appeal was filed on 18 November 2004, but the matter did not progress and no outline of argument on behalf of the appellant had been filed prior to a registrar’s reference on 20 January 2005 when the matter came to my attention. At that point the appellant complained of an inability to obtain a transcript of the proceeding before the tribunal, saying that although there was a recording made of what transpired, that recording had proved to be inaudible and hence untranscribable. The appellant was seeking an order from me that the tribunal member provide a copy of the notes made during the hearing.
It occurred to me that before considering whether such a step should be taken it would be appropriate to consider the application for leave to appeal. Ordinarily the question of whether leave is to be granted is argued and dealt with at the same time as the appeal, in order to save the parties costs. I therefore ordered that the application for leave be heard before me a few days later, as it was on 4 February.
The proceeding in the tribunal was to recover a relatively small amount alleged to be payable pursuant to a building contract, or rather a subcontract, between the respondent as the subcontractor and (as was found) the appellant as contractor in respect of the supply of fire doors for use in a project being constructed by the appellant for a company Magnamain Investments Pty Ltd. The respondent claimed $8,489.80 for fire doors supplied and delivered to the appellant which had not been paid for. The tribunal held that the appellant was liable to pay that amount to the respondent and ordered the payment with interest, a total of $10,688.03. It is from that order that the appellant seeks to appeal.
On the hearing of the application for leave to appeal leave was given to file an amended notice of appeal which identified an additional ground. The appellant alleged that the tribunal had erred:
(a) in misdirecting itself as to the probative value of the evidence given by Mr Redford for the appellant;
(b) in misdirecting itself as to the application of the rule in Jones v Dunkel (1959) 101 CLR 298;
(c) in failing to arrive at a conclusion supported by the evidence;
(d) in finding that the sum of $10,000 paid by bank cheque on 8 November 2001 was an advance on future works to be completed, rather than an amount which satisfied the existing indebtedness to the appellant;
(e) on the ground that it did not properly discharge its functions as a tribunal of fact and/or wrongly applied the principle stare decisis;
(f) in failing to find that the appellant owed no moneys to the respondent, and that the unexplained absence of evidence from Mr Murgia allowed the tribunal to draw the adverse inference that his evidence would not have assisted the respondent’s case, Mr Murgia clearly being in the camp of the respondent not the appellant.
The reasons for the decision of the tribunal indicate that there were two issues litigated before the tribunal. The first was as to the identity of the contracting parties. The respondent alleged that the subcontract was between it and the appellant and also two other companies, but that claim was rejected by the tribunal who held that the subcontract was made only with the appellant. The appellant did not seek to challenge this aspect of the decision. The other issue was whether the debt remained unpaid. That was the matter sought to be ventilated by the appellant on appeal.
The facts
The reasons of the tribunal member indicate that in July 2000 Magnamain Investments Pty Ltd entered into a contract with the appellant for it to construct 55 units with associated works at Kirra.[1] In about December 2000 the respondent entered into a subcontract with the appellant and commenced supplying and delivering fire doors to the site. The first three invoices were paid, but invoices between 23 May 2001 and 29 June 2001 were not paid, and in about July or August 2001 the respondent ceased supplying doors. The appellant was evidently having financial difficulties. It subsequently ceased trading and surrendered its builder’s licence. There were some negotiations between the parties in relation to making a payment, but the appellant sought to impose a condition that the respondent provide certain documentation. The tribunal found that that was not a reasonable condition to impose, and in the event the respondent rejected it.
[1]At this stage I am taking these facts from the reasons for decision. In the absence of a transcript there is nothing else I can do but I recognise that all findings of fact are potentially subject to challenge on the basis of error of law.
At a meeting on 8 November 2001 between a representative of the respondent and Mr Murgia as representative of Magnamain Investments Pty Ltd a cheque for $10,000 was handed over by Mr Murgia to the respondent. The evidence from the respondent was that this was a payment in advance to secure the delivery of further doors to the project. Evidently the respondent was prepared to provide further doors only on the basis that it was paid for them in advance. On the other hand, the appellant’s case was that this was a payment in respect of the existing indebtedness, and therefore discharged the indebtedness which was the subject of the claim by the respondent against the appellant.
There was a representative of the appellant at that meeting, for at least part of the meeting. He gave evidence that that was the basis on which the payment was made, but the tribunal member recorded in his reasons a concession under cross-examination that he was presuming that such a payment would be applied on normal accounting principles to the old debt first. The reasons record in effect that the tribunal considered that the cross-examination destroyed the value of that witness’s evidence. On the other hand, the tribunal regarded the evidence of the representative of the respondent as to what transpired at that meeting as reliable. For the appellant to succeed it is necessary to show that these findings of fact were vitiated by some error of law.
The appellant’s argument
It was in this context that the appellant relied on the failure of the respondent to call Mr Murgia to support the evidence of its representative as to the basis upon which the payment was made, and submitted in accordance with Jones v Dunkel that because Mr Murgia was not called an inference should be drawn against the respondent as to what his evidence would have been had he been called. The tribunal member dealt with this by concluding that it was not incumbent upon the respondent to call Mr Murgia, and that even if it were the respondent would have had difficulties similar to those which have been experienced by the appellant; there was evidence that the appellant’s attempts to locate or contact Mr Murgia had been unsuccessful.
I cannot see how that approach can be criticised. It is not apparent that there was any particular reason to treat Mr Murgia as being in the respondent’s camp rather than in the appellant’s camp for the purpose of the rule in Jones v Dunkel. The true situation is that Mr Murgia was a person who was independent of both parties. Whether his evidence assisted the appellant or the respondent depended on what he would say, but I do not know that that means that both parties have to account for the failure to call him in order to avoid an adverse inference.[2] Apart from this, if the appellant’s attempts to locate Mr Murgia had been bona fide and had been unsuccessful, there is no particular reason to think that the respondent would have been any more successful. Notwithstanding the forceful submissions made on behalf of the appellant, I am entirely unpersuaded that there is any reason to doubt the correctness of the conclusion arrived at by the tribunal on this issue. In my opinion in the circumstances the tribunal was clearly correct in concluding that it was not appropriate to draw any inference adverse to the respondent because of the failure to call Mr Murgia.
[2]Payne v Parker [1976] 1 NSWLR 191 at 201-2 per Glass JA.
Reliance was also placed on the proposition that there had been no evidence to support an allegation in the written statement of the respondent’s case as to the financial transactions between the respondent and Magnamain Investments Pty Ltd. It was submitted that this was something which had been pleaded and had not been proved, and that therefore the respondent’s case ought to have failed. But given the informal nature of proceedings in the tribunal[3] there is certainly no justification for adopting that approach. In any case, it seems to me that all that is relevant to be decided for a proceeding of this nature is whether this particular payment by that company was a payment in discharge of this existing liability of the appellant, or whether it was a payment for some other purpose. In my opinion in the circumstances prevailing here it was a matter for the appellant to prove that the payment by Magnamain Investments Pty Ltd was a payment in discharge of the appellant’s liability.[4] It was really not a matter for the respondent to prove to the contrary. The appellant has certainly not discharged that onus.
[3]Commercial and Consumer Tribunal Act 2003 s 47(3).
[4]That involves more than just proof that the payment was applied by the parties to it to that debt: see Goff and Jones “The Law of Restitution” (4th Ed 1993) p.17.
Apart from the evidence, which was accepted, by the representative of the respondent, there was some support for the respondent’s case in evidence of what transpired at a site meeting on 12 September 2001, at which the respondent was not present, when it was agreed among other things that Magnamain Investments Pty Ltd would pay all subcontractors and suppliers direct after the finalisation of a particular progress claim. Subsequently, but before 8 November 2001, the status of the appellant changed to being a project and construction manager. That seems to me to be consistent with the notion that the works were going to continue but that Magnamain Investments Pty Ltd would deal directly with the subcontractors in respect of those continuing works, which is consistent with Magnamain Investments Pty Ltd making arrangements with the respondent to pay for the subsequent fire doors supplied by the respondent. Even if the respondent had not required payment in advance, in those circumstances any payment by Magnamain Investments Pty Ltd would ordinarily discharge its indebtedness rather than any indebtedness by the appellant.
There is the further consideration that part of the arrangement in September 2001 was that Magnamain Investments Pty Ltd would pay an amount to a list of agreed subcontractors, provided that certain documentation was obtained from those subcontractors. Such documentation was sought from the respondent, but the respondent refused to provide it. That supports the conclusion that Magnamain Investments Pty Ltd was not making a payment to the respondent in respect of the existing indebtedness of the appellant pursuant to that arrangement.
It was submitted on behalf of the appellant that there was no documentary evidence to support the oral evidence that the payment of $10,000 was made as an advance payment for the provision of further fire doors rather than in discharge of the existing indebtedness, whereas there were documents which showed that the payment was treated by the appellant as a payment in discharge of its indebtedness. But how the payment was treated by the appellant was irrelevant in circumstances where the appellant was not a party to the payment. I have already referred to other evidence which in my view provides independent support for the conclusion that the payment of $10,000 was not in discharge of the past indebtedness of the appellant. In my opinion that evidence was ample for that purpose.
Conclusion
Having considered the reasons for judgment, I can detect no error of law in them. In my opinion the arguments sought to be advanced on behalf of the appellant are entirely without substance. I am unpersuaded that there is any serious argument that there was any error of law in the decision of the tribunal. In those circumstances in my opinion leave to appeal should be refused. It is not entirely clear what the test is for the grant of leave to appeal under s 100 of this Act, and I heard no argument in this matter as to what the test ought to be. But if the appeal seems clearly hopeless then in my opinion it must surely be appropriate to refuse leave. I am also conscious of the small amount involved. I should not be taken however as deciding that that is the only test of whether or not to grant leave to appeal under this section.
Leave to appeal is refused. I order the appellant to pay the respondent’s costs of the proceeding including reserved costs to be assessed.
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