Lauro v The Marble House of Australia Pty Ltd - [2013] SASC 186

SUPREME COURT OF SOUTH AUSTRALIA
(Magistrates Appeals: Civil)
LAURO v THE MARBLE HOUSE OF AUSTRALIA PTY LTD
[2013] SASC 186
Judgment of The Honourable Justice Blue
2 December 2013
CONTRACTS - GENERAL CONTRACTUAL PRINCIPLES - DISCHARGE, BREACH AND DEFENCES TO ACTION FOR BREACH - REPUDIATION AND NON-PERFORMANCE
CONTRACTS - GENERAL CONTRACTUAL PRINCIPLES - FORMATION OF CONTRACTUAL RELATIONS
DAMAGES - MEASURE AND REMOTENESS OF DAMAGES IN ACTIONS FOR BREACH OF CONTRACT - GENERAL
The Marble House of Australia Pty Ltd contracted with Mr Lauro to supply and install granite kitchen benchtops and supply marble floor tiles. Mr Lauro rejected the benchtops and tiles because he claimed the they were not in accordance with the contract. He sued Marble House for, inter alia, damages for breach of contract. A Magistrate dismissed Mr Lauro's action.
Mr Lauro appeals against the dismissal of his action. The issues which arise on appeal are:
1.      Did the Magistrate err in finding that it was not an oral term of each contract that Marble House would pay interest on the deposit paid by Mr Lauro at 15 percent per annum if the benchtops or tiles were not supplied?
2.      Did the Magistrate err in finding that the granite benchtops delivered by Marble House complied with the benchtop contract? If yes, was Mr Lauro entitled to damages of $555 and $400 for additional costs incurred? If not, was Marble House entitled to $4200 for them?
3.      Did the Magistrate err in rejecting Mr Lauro’s case that he terminated the tile contract for breach of an essential condition? If yes, is he entitled to damages of $7966 for additional costs incurred?
Held by Blue J dismissing the appeal:
1.      The Magistrate was entitled to find that it was not an oral term of each contract that Marble House would pay interest on the deposit (at [61]-[67]).
2.      The Magistrate was entitled to reject Mr Lauro's case that the granite benchtops complied with the benchtop contract. The evidence adduced by Mr Lauro failed to show that the granite benchtops were not fit for purpose (at [83]-[95]):
a)      The Magistrate was entitled to find that Marble House was entitled to retain $4200 on account of the value of the granite benchtops which it had supplied (at [101]-[102]).
b)      The Magistrate was entitled to find that, even if there was a breach of contract, Mr Lauro was not entitled to damages of $555 for additional costs because he failed to prove the market value of Sorrento Verde granite benchtops as at August 2005 and he was not entitled to damages of $400 for additional costs because he failed to prove that he paid that amount for removal of the benchtops (at [112] and [117]-[120]).
3.      The Magistrate was entitled to reject Mr Lauro’s case that he was entitled to loss of value of bargain damages in respect of the tiles. Mr Lauro did not communicate in a manner capable of making time of the essence for supply and delivery under the tile…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Lauro v The Marble House of Australia Pty Ltd

Details

AGLC: Lauro v The Marble House of Australia Pty Ltd [2013] SASC 186
Case: [2013] SASC 186
Decision Date: 2 December 2013

CaseChat Overview and Summary

The case of Lauro v The Marble House of Australia Pty Ltd involved Mr Lauro, a homeowner, and The Marble House of Australia Pty Ltd, a supplier of natural stone products including granite benchtops and marble tiles. The dispute arose from a contract between Mr Lauro and The Marble House for the supply and installation of granite benchtops and marble tiles for Mr Lauro's home. Mr Lauro alleged that The Marble House had breached the contract by failing to deliver the tiles and by delivering a defective benchtop. The case was heard in the Supreme Court of South Australia. The court was required to determine several legal issues, including whether there was an oral term of each contract that The Marble House would pay interest on the deposit at 15 per cent per annum if the benchtop or tiles were not supplied, whether the granite benchtop delivered by The Marble House complied with the benchtop contract, and whether Mr Lauro was entitled to terminate the tile contract for breach of an essential condition.

The court found that there was no oral term of each contract that The Marble House would pay interest on the deposit at 15 per cent per annum if the benchtop or tiles were not supplied. The court also found that the granite benchtop delivered by The Marble House complied with the benchtop contract and that Mr Lauro was not entitled to damages of $555 and $400 for additional costs incurred. The court rejected Mr Lauro's case that he terminated the tile contract for breach of an essential condition and found that Mr Lauro was not entitled to damages of $7,966 for additional costs incurred. The court concluded that The Marble House was entitled to $4,200 for the costs incurred in delivering the benchtop and tiles. The appeal was dismissed, and the parties were heard as to consequential orders, including costs.

Orders

Orders of the court

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Background

Background to the litigation

The appeal raises the following principal questions:1.Did the Magistrate err in finding that it was not an oral term of each contract that Marble House would pay interest on the deposit at 15 per cent per annum if the benchtop or tiles were not supplied?2.Did the Magistrate err in finding that the granite benchtop delivered by Marble House complied with the benchtop contract? If yes, is Mr Lauro entitled to damages of $555 and $400 for additional costs incurred? If no, was Marble House entitled to $4,200[1] for them? 3.Did the Magistrate err in rejecting Mr Lauro’s case that he terminated the tile contract for breach of an essential condition? If yes, is Mr Lauro entitled to damages of $7,966 for additional costs incurred? [1] All dollar figures are inclusive of GST.Background Marble House carries on business as a supplier of natural stone products including granite benchtops and marble tiles. It is owned and controlled by Mr and Mrs Scardigno. Its head office and showroom is at Kent Town and its factory and warehouse is at Gepps Cross. Mr and Mrs Lauro purchased land at Rostrevor. In November 2003, Mr Lauro entered into a contract with a builder to construct a large two storey house on the land for approximately $450,000. In July 2004, Mr Lauro instructed the builder to stop work and took over construction himself. In July 2004, Mr and Mrs Lauro visited the Kent Town showroom and asked Mr and Mrs Scardigno to quote for the supply and installation of granite surfaces for the kitchen comprising benchtops, a servery top and splashbacks. He also asked Marble House to quote for the supply of marble floor tiles for common areas, namely the family room, dining room, lunch room and passage. Mr Scardigno showed to Mr Lauro samples of granite and marble tiles. Mr Scardigno gave evidence, which was not challenged or contradicted, that he explained to Mr Lauro that Botticino tiles could be either Classico or Semi Classico and that the Classico have more gold veins but are more susceptible to the clay coming away in the vicinity of the veins. Mr and Mrs Scardigno gave evidence, which was not challenged or contradicted, that they had never purchased Botticino Fiorito tiles, which were inferior to both Classico and Semi Classico. Mrs Scardigno’s evidence that Mr Lauro wanted the tiles calibrated and bevelled but left the thickness to Marble House was not challenged or contradicted. Mr Lauro selected Sorrento Verde granite for the kitchen surfaces and Botticino Semi Classico marble tiles. Mr Scardigno gave to Mr Lauro a sample Semi Classico tile (exhibit D12). Mr Scardigno claimed and Mr Lauro denied that Mr Lauro was given a sample of Sorrento Verde granite. On 31 July 2004, Mr and Mrs Lauro returned to the Kent Town showroom and spoke to Mr and Mrs Scardigno. Mr Lauro and his son Daniel Lauro gave evidence that Daniel was also present on this occasion. Mr and Mrs Scardigno gave evidence that generally Mr Lauro was accompanied by his wife but on one occasion Daniel was present. On this occasion, Mr Lauro was given two quotations by Mr and Mrs Scardigno. The quotation for the granite kitchen surfaces was $5,370 for the benchtops and $1,595 for the splashbacks. The quotation for the tiles specified 150 square metres of Botticino Semi Classico tiles 400 mm x 400 mm x 12/13 mm approximately. It totalled $14,685.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

There is no substance to this complaint. Marble House’s claim against Mr Lauro under the benchtop contract was not for unliquidated damages but for a liquidated amount by way of quantum meruit. A set-off was available at common law against the liquidated amount due under the tile contract by way of refund of the deposit. In any event, in the circumstances, an equitable set off was available.[13][13] See, for example, Clarke v Cort (1840) Cr & Ph 154; 41 ER 449; Tony Lee Motors Ltd v M S MacDonald& Son (1974) Ltd, (1981) 2 NZLR 281; Kostka v Addison [1986] 1 Qd R 416.Conclusion I dismiss the appeal. I will hear the parties as to consequential orders, including costs.

Ratio Decidendi

Legal Principle Established

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