Kossowski v PSP Enterprises P/L - [2016] SADC 114

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil: Application for Review)
KOSSOWSKI & ANOR v PSP ENTERPRISES P/L
[2016] SADC 114
Judgment of His Honour Auxiliary Judge Clayton
15 September 2016
MAGISTRATES - APPEAL AND REVIEW - SOUTH AUSTRALIA
Section 38 of the Magistrates Court Act provides that a minor civil action is a fully inquisitorial enquiry actively managed by the presiding magistrate, rather than an adversarial trial process and accordingly a review by the District Court under section 38(7) is an enquiry to determine whether the fundamentals of a full and fair inquisitorial enquiry have occurred, rather than a process to be addressed by reference to traditional principles applicable to the hearing of an ‘appeal’.
Magistrates Court Act s 38, referred to.

KOSSOWSKI & ANOR v PSP ENTERPRISES P/L
[2016] SADC 114

The plaintiff claimed $11,747.02 for earthworks carried out at the request of the defendants at a nursing home at Kadina.
Background
The plaintiff initiated a minor civil claim in the Port Adelaide Magistrates Court on 17 June 2016. The Magistrate found that the plaintiff had charged industry rates for the work he completed as charged in the invoices that were to be paid by the defendant. The Magistrate found that the defendant did not take issue with the amount of the plaintiff’s charges until about one year after the invoice for the work had been rendered. The Magistrate considered that if there had been any real issue about the amount charged, the proprietor of the defendant’s business – who is the applicant in these proceedings – as an experienced businessman, would have raised the issue much earlier if the amount was not right at the time the invoices were rendered.
The Magistrate found that the evidence raised by the defendant in support of the claim that the defendant had been overcharged for the work was not strong. He said it amounted to little more than an assertion by the defendant that the work could have been done for less. The Magistrate had no hesitation in finding that the plaintiff had discharged the onus of proving that the amount outstanding was due and payable by the defendant.
In an ex tempore decision, the Magistrate gave reasons and judgment in favour of the plaintiff for the amount of the claim and dismissed the defendant’ s counterclaim, which he said followed as a matter of logic on his finding in favour of the plaintiff.
Application for Review
This is an application under s 38 of the Magistrates Court Act 1991 (SA) to review the decision of the Magistrate. The defendants issued this application for review by application to the District Court dated 15 August 2016. The grounds for review in respect of the Magistrate’s judgment for $11,747.02 as set out in the application are:
a)The applicant/defendants had available a Quantity Surveying Report from John Deans & Associates and attempted to adduce that evidence but the Magistrate refused to receive the evidence at all;
b)The Magistrate erred in not receiving the defendants’ own evidence of industry rates and reasonable time to do the work;
c)The issue that Magistrate was required to decide was the fair value of the work done by the plaintiff. The magistrate erred in having regard to the asserted terms of payment in the plaintiff’s invoices.
In respect of the Magistrate’s decision to dismiss the defendants’ counterclaim the ground of appeal is:
d)Since the hearing, the applicant has been required to return to the site (18/7/16 and 21/7/16) to carry out works required as a result of the plaintiff’s work not being done properly.
i)The plaintiff had failed to compact the backfill appropriately and as a result the backfill had subsided and pipes underneath the backfill have broken;
ii)The applicants were required by the principal to correct the defective work;
iii)The applicants returned to site on 18/7/16 and 21/7/16 and excavated approximately 10 metres of backfill, repaired the pipes, and imported approximately 3 tonnes of extra rubble to top up approximately 10 metres of trenches;
iv) The cost of doing this work was $2055 plus GST.
The counterclaim relates to work that was carried out after the judgment had been delivered. The cost of the work said to give rise to a counterclaim did not form part of the proceedings before the Magistrate. Any counterclaim in respect of the work which is alleged to have cost $2055 should be the subject of separate proceedings. Also, no evidence or argument with respect to the counterclaim was put forward on the review.
In so far as the review relates to the counterclaim it must be dismissed.
So far as the ground for review in paragraph a) and the evidence of the quantity surveyor is concerned, I note that the transcript of proceedings before the Magistrate records that the following dialogue took place:
His Honour:      do you really want to call this quantity surveyor.
Ms Kossowski: no. I don’t know.
His Honour:      I’m happy to give judgment on the basis of what I’ve heard now. If you want to have the opportunity to call that that quantity surveyor here I’d have to consider your application. So what do you want me to do. You want me to give judgment now or do you want to ask that the matter be adjourned for this quantity surveyor to be called.
Ms Kossowski: we’ll have your judgment.
His Honour:      I’ll give a next party – given oral decision now and I’ll just endeavour to explain why I am making this finding. [1]
[1] Transcript from Magistrate’s Court Proceedings, 72.
In light of this, I find that ground a) of the application is factually incorrect. The applicant applied to call the quantity surveyor on the review. The respondent opposed the application. The quantity surveyor was present in the body of the court and in the interest of justice I ruled that he could give evidence on the review.
Mr Deans’ Evidence
Mr Deans is an experienced chartered quantity surveyor. He gave evidence about the amount that he would have estimated the work to have cost for the purpose of a “budget cost plan”. However, Mr Deans did not inspect the site. He said that he had arrived at a “budget price” and explained:
It means an indicative price. The client says “I’ve got to do some excavation at Kadina, roughly what would this cost”. So I undertook the exercise on that basis to say what is a reasonable price. I had no idea, never met Mr Philbey or knew anything about the job which was to be undertaken.[2]
[2] Transcript from Minor Civil Review Proceedings, 21.
Mr Deans relied on information provided to him by the defendant. He had no knowledge of the time actually taken by the plaintiff to carry out the work. The only information he had was the information in the particulars of defence provided to him by the defendant.[3] He had no knowledge of the plant and equipment used by the plaintiff. He did not visit the site. He was unaware of the manner in which the work was carried out. He was unaware of the fact that it was necessary to make a hole, which was more or less square in shape, which made the volumes greater than would have been the case with a round hole. He said he had no idea how the operation was undertaken,[4] he did not know that a ramp was required,[5] and he was not aware of the volume of material that was actually placed around the tank.[6]
[3] Ibid, 22.
[4] Ibid, 24.
[5] Ibid, 25.
[6] Ibid, 26.
Mr Deans is a highly qualified and competent quantity surveyor and I found him to be a reliable and honest witness. However, because of the deficiencies in the instructions given to him his evidence does not assist me in this case.
The transcript does not establish that the Magistrate refused to accept the defendant’s own evidence of industry rates and reasonable time to do the work. I have not been persuaded that the Magistrate erred in accepting the evidence of the plaintiff.
Mr Kossowski’s and Mr Philbey’s Evidence
I heard evidence from both Mr Kossowski and Mr Philbey. I accept without reservation the evidence of Mr Philbey. I have sympathy for Mr Kossowski. It is apparent that he underestimated the cost of the excavation work which he retained the plaintiff to carry out. He is therefore unable to recover the full cost of the plaintiff’s work from his client. Making accurate estimates is one of the vicissitudes of business.
Findings
I accept the Magistrate’s finding that it was not until sometime after the invoice had been rendered that the defendant queried the plaintiff’s charges. That finding is reinforced by the evidence which I heard.
So far as the counterclaim is concerned, the defendant did not produce any evidence which establishes the claim. The Magistrate said that he did not understand the counterclaim.[7] I don’t understand it either. As to ground c), there is no merit in this ground and it can be ignored for the purpose of this review.
[7] Above n 1, 25.
I accept the evidence of the plaintiff. The plaintiff’s charges are evidenced by the invoices which were presented as Exhibits R1 and R3. The invoices identify the piece of machinery, the day and number of hours on which it was used. They identify the hourly rate in respect of the particular machinery. Mr Philbey recorded the number of hours in his diary from which they were transposed to the invoices. I accept that it was the normal practice for earthmoving contractors to charge on the basis that the plaintiff charged for this job.
I am therefore satisfied that the plaintiff’s charges were fair and reasonable and I make an order affirming the judgment of the Magistrate.