Leahy v Watermin Drillers Pty Ltd

[2021] NSWCATCD 28

Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation:

Leahy v Watermin Drillers Pty Ltd [2021] NSWCATCD 28

Hearing dates:

13 April 2021

Date of orders:

11 June 2021

Decision date:

07 June 2021

Jurisdiction:

Consumer and Commercial Division

Before:

W Priestley, General Member

Decision:

1. The application is dismissed.

2. The applicant, Louis Leahy is to pay Watermin Drillers Pty Ltd $17,325.00 immediately.

Catchwords:

Nil

Legislation Cited:

Fair Trading Act 1987 NSW

Cases Cited:

Nil

Texts Cited:

Nil

Category:

Principal judgment

Parties:

Louis Leahy (Applicant)
Watermin Drillers Pty Ltd (Respondent)

File Number(s):

GEN 20/43063

Publication restriction:

Nil

REASONS FOR DECISION 

Background

1. The parties entered into a contract which required the respondent to drill a bore, for the purpose of obtaining water, at the applicant’s premises in Orange, NSW. Ultimately, a bore was drilled to a depth of 200 metres. The applicant contends that he made it known to the respondent that he only wanted sufficient water to fill a 5,000 litre tank, to water his garden, and sufficient water for this purpose was obtainable at about 28 metres. The respondent denies this, and says the applicant wanted sufficient water to not require mains water, the respondent kept the applicant accurately informed as the drilling progressed, and it was at the applicant’s informed direction that it kept drilling to 200 metres. The respondent also contends that what water now enters the bore, is “seepage”, which is insufficient for the purpose the applicant said he wanted.

2. The applicant asserts the work was also incomplete in that a pumphead and manhole were not provided, and damage was done to his property.

3. At a directions hearing on 27 November 2020, the Tribunal noted the applicant claimed a refund of $1,518; $1,000 compensation for damages; an order that he not have to pay $24,000; and an order the respondent provide a statutory report to the NSW Water Authority.

Issues

4. The main issues for the Tribunal to determine are:

1. Whether it was a term of the contract, that the respondent was to drill to a depth to enable sufficient water to be obtained to fill a 5,000 litre tank so the applicant could water his garden. If so, whether such water was available at a depth of 28 metres. If so, what compensation the applicant is entitled to, and whether the applicant should be relieved from paying the balance of the amounts invoiced to him by the respondent.

2. Whether the respondent was required under the contract, to contain and dispose of the spoil from the drilling. If so, what compensation the applicant is entitled to.

3. Whether the applicant is entitled to compensation for mental distress, and for the cost he paid for the pump, pumphead and manhole.

Evidence

5. Prior to the hearing on 17 February 2021, the applicant lodged and served an affidavit affirmed by him on 16 November 2020 of 140 paragraphs over 27 pages, and an affidavit of 48 paragraphs over 25 pages dated 14 October 2020.

6. Prior to the hearing on 17 February 2021, the respondent lodged and served a folder of documents that contained: an undated statement of Max Jones, the Managing Director of the respondent; an undated statement of Alex Maloy-Armitt, who drilled the bore; letters and email correspondence between the parties; a mainly illegible copy of the signed contract between the parties, and an unsigned legible copy of that contract; invoices for payment of the work; a Bore Licence approval and an authority to proceed with the drilling of the bore.

7. The hearing was unable to be concluded on 17 February 2021, and resumed on 30 March 2021. At hearing, the Tribunal attempted to clarify the evidence of the parties’ witnesses, and each party was given the opportunity to cross-examine their opponent’s witnesses. At the conclusion of the hearing on 30 March 2021, the Tribunal requested the parties to provide written submissions. Both parties provided submissions. The applicant then provided further submissions of 98 paragraphs, under cover of a form headed “Application for miscellaneous matters, in which he sought an order “Strike out of new pleadings introduced”. I understand that application to be to disallow the introduction of further evidence contained in the respondent’s submissions. The applicant is correct to object to further evidence being introduced by the respondent. No leave to do so was sought by the respondent, and a perusal of those submissions shows there is no allegation of any facts that would not have been available to the respondent at the hearing. Accordingly, the Tribunal has not taken into account any new allegations of fact in the respondent’s submissions.

8. Much of Mr Leahy’s evidence is repetitive, irrelevant and contains unsourced hearsay, and hearsay evidence of Mrs Leahy, from whom there is no evidence and no explanation as to why that is so. It is also particularly vituperative in many respects. Because of this I treat Mr Leahy’s evidence with significant caution. Much of it is discursive, and it is difficult to isolate relevant factual assertions. It also contains opinions of an expert nature about geotechnical and hydraulic matters, which Mr Leahy is not qualified to make.

9. The evidence of Mr Jones and Mr Maloy-Armitt was reasonably cogent.

Findings

10. On 10 September 2020 Denise Leahy, the wife of Louis Leahy, signed a contract with the respondent for the construction of a bore on their land near Orange. The land contains a residential home, and comprises an area of about 800 square metres. Sheryl Jones signed the contract on behalf of Watermin Drillers Pty Ltd. Because Mr Leahy, not Mrs Leahy, dealt with the respondent in virtually all respects, including before, during, and after the construction of the bore, and conducted the proceedings, I have assumed Mrs Leahy signed the contract on Mr Leahy’s behalf as his agent.

11. The contract document consists of two pages. The first is headed “Item C Signed Authority to Proceed with drilling – 2 pages” The second is headed “Authority to Proceed with Drilling Terms and Conditions”. Both pages are signed by Denise Leahy and Sheryl Jones. The contract requires the applicant to pay the respondent $9,000.00 plus GST, in three increments of $3,000 plus GST, to drill a bore to a depth of fifty metres. If the depth is shallower or deeper than 50 metres, the price is to be reduced or increased by $165 per metre. There is a list of additional services and materials for which no price has been allocated.

12. Like much of the contract, clause 3 on page 2 is poorly drafted. It states “The Owner must pay any and all costs to: (c) the owner must do everything to ensure that all water & debris produced is contained on the property and make good the area after termination of the works to comply with Environment Protection Act requirements.”

13. Clause 7 two states “The Owner acknowledges that the Contractor makes no representation or warranty that the drilling carried out pursuant to this Authority shall produce results satisfactory to the Owner and this agreement and payment hereunder shall not be conditional upon the result being satisfactory to the Owner.”

14. Clause 10 states “If drilling for water, the Contractors will record strata details and water cut information, if water is found, for the Owner or his agent as soon as reasonably possible after such find, and fill out the recorded information on the appropriate Department form and deliver to the owner after payment in full for the materials and services provided and invoiced.”

15. Mr Maloy-Armitt put the drilling rig on the applicant’s property on 12 September 2020. Before the work commenced, Mr Leahy paid $3,300.

16. Before Mr Maloy-Armitt commenced drilling he spoke with Mr Leahy about the need to contain the spoil, and recommended a skip bin. Mr Leahy declined and over the course of the drilling, significant amounts of mud or slush were deposited on the applicant’s lawn. In this regard, I note the email correspondence between the parties before work commenced, clearly indicates the applicant was to be responsible for the waste. On 8 September Ms Jones emailed the applicant. The email attaches the contract, and asks the applicant to sign it if it meets with his approval. It also clearly states in the second last paragraph “Please note debris must be retained on your property and to be removed by others or for approx $500 a storage tank can be hired form Polpure Liquid Waste and they will suck the waste up and dispose of it, if this is the better option their telephone number is …..”. The same day Mr Leahy asked how much waste comes to the surface and indicated he is considering using it along his back fence and to put under pavers. Ms Jones replied about one wheelbarrow full would be produced for every 5 metres of drilling, and 50 metres would produce approximately 10 wheelbarrows full.

17. Mr Jones also stated in his evidence he told Mr Leahy on several occasions, that he (Mr Leahy) was responsible for the waste, and that on one occasion he was abrupt with Mr Leahy as it was a condition of the drilling licence that the waste be controlled. Given the contractual requirement for Mr Leahy to contain the waste, this is entirely plausible.

18. There was clearly no variation of the contractual requirement for Mr Leahy to contain the waste, and for Mr Leahy to assert otherwise and claim the costs of doing so, erodes his credibility on other issues. Because of this, and the observations made about the evidence in paragraphs 8 and 9 above, I prefer the evidence of Mr Jones and Mr Malloy-Armitt wherever it conflicts with the uncorroborated evidence of Mr Leahy.

19. Drilling commenced on Monday 14 September 2020. On that day drilling reached 28 metres. Mr Maloy-Armitt, who relayed information from the site to Mr Jones, gave evidence that only “seepage” had been found by then. Mr Maloy-Armitt, who has been drilling water bores for 6 years, and has a license to do so, explained in oral evidence to the Tribunal that “seepage” was an unreliable source of water, particularly in dry times. Water from seepage comes from sources such as creeks (by which I understand it does not come from an aquifier), sits on top of rock, and can drain away through cracks in the rock. Mr Jones, who has been drilling water bores for 64 years and is a qualified water driller, gave more detailed evidence about the inadequacy of seepage water. In paragraph 9 of his undated statement he said, “You will notice that immediately water is struck in a suitable volume it flows from the top of the bore hole, while the drilling is in progress”. This did not happen.

20. Mr Leahy was advised by Mr Jones after the drilling finished on 14 September 2020, that only seepage had been found, and it may not withstand sustained pumping. Mr Leahy instructed the respondent to continue drilling.

21. On 15 September 2020, drilling reached 50 metres, and still only seepage had been found. Mr Jones discussed this with Mr Leahy, and told Mr Leahy he could stop now and just use the water above 30 metres, move to another site, or drill deeper (paragraph 11 of his statement refers). Mr Jones contends Mr Leahy told him “he wanted a worthwhile amount of water, like the Council supply” Mr Jones then recommended not going beyond 80 metres, as that was deeper than the nearest bore (which I understand to mean it would be unlikely water in a suitable volume would be found beyond that depth).

22. By this stage the bore had been drilled deeper than the 50 metres allowed for in the contract at a price of $9,900.00. In an email dated 15 September 2021 and timed at 7.55 p.m. from Mr Leahy to Sheryl Jones, Mr Leahy proposes a lower rate to drill to 200 metres. It was subsequently agreed that drilling from 50 metres to 80 metres would be charged at $165 per metre, and from 80 metres to 200 metres at $90 per metre, plus GST.

23. Drilling then continued to 200 metres, and no suitable volume of water was found. By that stage Mr Leahy had paid $6,600.00, and the total cost charged in accordance with the contract and subsequent agreement to drill to 200 metres was $27,325, leaving a balance of $17,325.

24. There was then a discussion between Mr Jones and Mr Leahy about what should now be done. It was decided to seal the bore at 30 metres then case it above that depth, and this was done.

25. Mr Leahy then disputed the need to drill beyond 28 metres, the depth reached on the first day when seepage was found. He has refused to allow the respondent to return to his property. Mr Leahy then installed a pumphead, and pump. This enables water to be extracted and put in a tank. Mr Leahy also installed a manhole. The cost of the pumhead, pump and manhole was $3705. The individual cost of the manhole is not known.

26. Mr Leahy says he made it clear to the respondent he only wanted sufficient water to water his garden via a 5,000 litre tank, and the seepage at 28 metres was sufficient to do that. He alleges the respondent knew that, and has deliberately misled him to increase the cost of the work.

27. From all the voluminous evidence Mr Leahy has lodged, I cannot find any specific allegation he told anyone from the respondent company that he only wanted water sufficient to fill a 5,000 litre tank from which he could water his garden. At paragraph 47 of his affidavit dated 16 November 2020, Mr Leahy says “Denise had discussed with them that we were going to connect up the existing sprinkler system to our tanks and they need to be careful about these”. Even if it is accepted that conversation occurred, it falls well short of saying that was the only purpose for which they wanted water.

28. At hearing, Mr Leahy pressed the alleagation he had specifically advised the respondent he only wanted sufficient water to water his garden via a 5,000 litre tank. Mr Jones was adamant under cross examination there never was any such discussion before drilling finished at 200 metres, and it was he, not Mr Leahy who mentioned it, so Mr Leahy could get some benefit from the bore. That is consistent with what was subsequently done, and plausible. I accept Mr Jones’ account in that regard, and also that Mr Leahy had told him he wanted water to replace the Council supplied water.

29. Mr Leahy also alleged at hearing that he told Mr Maloy-Armitt before drilling commenced that he only wanted water for his garden. Mr Leahy did not put that to him in cross-examination, so the Tribunal did. The following exchange occurred.

Tribunal: “He (Mr Leahy) didn’t tell you to put it (the bore hole) in a different spot because he wanted to put a tank there?”

Mr Maloy-Armitt: “No. He said if it was there it would work better because he could plumb it into the irrigation system going around his garden”

Tribunal: “Did he mention anything about a tank?”

Mr Malloy-Armitt: “No”

30. Mr Leahy was then given an opportunity to cross examine on that.

Mr Leahy: Do you recall a discussion we had at the outset in regard to the customer you had at Cougal Drive and that he didn’t want to have a tank and I clearly said to you we intended to have a tank?”

Mr Malloy-Armitt: “That conversation did not take place at the start of the hole”

Mr Leahy: I put it to you it did take place and you are not telling the truth”

Mr Maloy-Armitt: “No. I put it to you the other client’s hole was discussed when we got down to the depth at the end of it”

Mr Leahy: So you do confirm we did have that discussion. Thank you sir.”

31. That hardly amounts to an admission there was an agreement or representation that drilling should only be to a depth to obtain sufficient water for the applicant’s garden.

32. Having considered all of the evidence, I find there was no such agreement or representation. If I am wrong about that, I cannot be satisfied on the balance of probabilities, there was such an agreement or representation.

33. Furthermore, I do not find it proved that the water obtained, or obtainable, at 28 metres, sufficient for such a purpose. Mr Leahy relies on his own observations and calculations about what the bore can produce now it has been sealed, or plugged, below 30 metres.

34. At paragraph 13 of his affidavit dated 7 December 2020, Mr Leahy calculates “In 10 minutes the bore refreshes with 5 & 1/3 x 22 litre buckets of water that is an hourly flow rate of 703.56 litres of water per hour.”

35. At paragraphs 68 to 77 of his affidavit dated 16 November 2020, Mr Leahy makes a lengthy attempt to prove there is substantially much more water now being produced, or available, from the bore than he says the respondents asserted. It involves complicated calculations based on unsubstantiated facts, and complex concepts such as “the gravitational constant” and pressure calculations. At paragraph 75 a flow rate of 16,626 litres per hour is arrived at. I am unable to follow the methodology used, am not satisfied the facts the methodology is based on are correct, and note Mr Leahy has no qualifications, experience or expertise which would enable him to make such opinions. Mr Leahy says at paragraph 31 of his affidavit dated 14 October 2020, he has calculated the flow using a web based calculator to be 3,000 to 4,000 litres per hour. At paragraph 26 of Mr Leahy’s submissions, or summation, dated 19 April 2021 he says, “The applicant has provided independent third party evidence (Leahy affidavit 16.11.20 paragraph 75) that there is water at a rate of 182 US gallons per hour (700 litres/3.785 or 153 imperial gallons per hour (700/4.54609).” That evidence is obviously not independent, and the submission seems to contradict the opinion in paragraph 75. In any event, for the reasons given I cannot accept it. On Mr Leahy’s own evidence I cannot accept the bore now produces sufficient water for watering his garden, whatever amount that may be.

36. Mr Jones was asked by the Tribunal about the applicant’s water flow calculations at the hearing. He gave some concise reasons why they were incorrect, which do not need to be repeated here. He also pointed out no-one seems to have observed Mr Leahy perform the testing.

37. Mr Leahy has not established the bore, which is now approximately 28 metres deep, produces sufficient water to water his garden. Even if he had established that, Mr Leahy has not established that was the purpose for which he wanted the bore drilled, and that he made that known to the respondent.

Consideration

38. The applicant seeks relief from payment of the balance of the contract price, being $17,325. The applicant bears the onus of proving he is not required to pay that amount. He has failed to discharge that onus, and I find he is obliged to pay it. As I have also found it was the applicant’s obligation to contain the spoil, there is no obligation for the respondent to pay for that, nor is there an entitlement to the $1,000 in non-economic loss claimed because of alleged mental distress caused by the state of the lawns and gardens because of the spoil. Once the applicant pays the $17,325, the respondent will be required under the contract to issue a statutory report to the NSW Water Authority. There is no indication the respondent will not comply with that obligation, and therefore no order in that regard is required. Finally, the applicant is not entitled to any amount for supplying the pumphead and pump, as he prevented the respondent from doing so, and it would appear from the contract those costs were to be additional to the cost of drilling the bore hole, as was the cost of the manhole.

Jurisdiction

39. The Tribunal finds the applicant is a “consumer”, the first respondent is a “supplier”, and the application is a “consumer claim”, as those terms are used in sections 79D and 79E of the Fair Trading Act 1987 NSW.

40. The Tribunal has jurisdiction to hear and determine the application under sections 28 and 29 of the Civil and Administrative Tribunal Act 2013 NSW and Division 3 of the Fair Trading Act.

41. Section 79O of the Fair Trading Act reads;

79O ORDERS IN FAVOUR OF RESPONDENT

In determining a consumer claim wholly or partly in favour of a respondent to the claim, the Tribunal may make any one or more of the following orders that it considers appropriate--

(a) an order dismissing the claim or a part of the claim,

(b) an order that requires the claimant to pay to the respondent a specified amount of money,

(c) an order that requires the claimant to return to the respondent specified goods which are in the possession or under the control of the claimant, whether the property in the goods has passed or not.

42. Accordingly there should be orders made that the applicant’s claim be dismissed, and that the applicant pay the respondent the amount of $17,325.00.

43. In making these orders the Tribunal is satisfied they will be fair and equitable to the parties to this claim, and has taken into account the factors set out in section 79U (2) of the Fair Trading Act. However the Tribunal is of the view they are not material to the particular circumstances of the case.

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I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.

Registrar

Decision last updated: 05 August 2021