Longridge Group P/L v Page - [2017] SADC 16

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil: Minor Civil Review)
LONGRIDGE GROUP P/L v PAGE
[2017] SADC 16
Reasons for Decision of His Honour Judge Cuthbertson
6 March 2017
MAGISTRATES - APPEAL AND REVIEW
Application to review a judgment in a minor civil review dismissing an application by the applicant for summary judgment on the ground that no duty of care existed.
Whether the enactment of the Building Work Contractors Act 1995 and the provision of statutory warranties under that Act in relation to domestic building work contracts impliedly repealed the common law provisions for a duty of care in relation to the performance of contracts for domestic building work.
Held:
1) The Building Work Contractors Act 1995 did not repeal the common law provisions as to negligence in its application to a domestic building work contract.
2) A duty of care may exist in relation to work performed pursuant to a domestic building work contract.
Building Work Contractors Act 1995 (SA) s 32, referred to.
Bryan v Maloney (1995) 182 CLR 609; Potter v Minahan (1908) 7 CLR 277; Thompson v Australian Capital Television P/L (1994) 54 FCR 513; 127 ALR 317; Owners Corporation Strata Plan 72535 v Brookfield [2012] NSWSC 712; Community Coproration 26038 Inc v Marshall & Brougham (Constructions) P/L (No 11 of 2015 DCSA), considered.

LONGRIDGE GROUP P/L v PAGE
[2017] SADC 16

The respondent is the owner of a property at 43 Underwood Avenue, Goolwa Beach having purchased the property in about May 2011.
The property had been built by the applicant in about August 2007.
The respondent, on 9 December 2015 issued proceedings as a minor civil action in the Magistrates Court of South Australia for damages for the cost of rectification work said to be occasioned by a failure to provide a water proof membrane in the second bathroom.
The pleadings assert that the applicant owed a duty of care in the construction of the house and failed to construct the dwelling in a proper and workmanlike manner.
The applicant filed a defence in which it asserted that any statutory warranties were statute barred and that it did not owe a duty of care to the plaintiff.
On 22 February 2016 the applicant filed an application for summary judgment asserting that the contract was a domestic building work contract as defined in the Building Work Contractors Act 1995 and that the work was for domestic building work as defined in that Act and that, accordingly, the only remedy open to the respondent was pursuant to s 32(2) of the Act, and that, such remedy was statute barred.
The applicant asserted that there was no co-existing cause of action in negligence because s 32(3) of the Building Work Contractors Act 1995 impliedly covered the field and therefore removed the common law duty of care in such cases.
Accordingly, it was asserted that there was no conceivable cause of action in which the respondent could succeed and that, therefore, the claim should be summarily dismissed.
On the 12 April 2016 Magistrate S. H. Milazzo declined the applicant’s application for summary dismissal of the claim.
His Honour ruled that the enactment of the Building Work Contractors Act 1995 did not remove rights existing at common law in negligence.
The applicant has made application dated 2 May 2016 to review the decision of the Magistrate.
The grounds of appeal are as follows:
1.   The learned Magistrate erred as a matter of law in finding that a duty of care was owed by the Defendant to the Plaintiff in circumstances where Parliament had enacted the Building Work Contractors Act 1995 (SA) and made clear provision for the extent to which the Defendant was liable to the Plaintiff as a subsequent owner of domestic building work for a defect in that building work.
2.   Further, the learned Magistrate erred as a matter of law in finding by implication that the statutory regime in New South Wales under the Home Building Act 1989 (NSW) was different from that under the Building Work Contractors Act 1995 (SA) and in distinguishing the decision in Owners Corporation Strata Plan 72535 v Brookfield on that basis.
3.   The learned Magistrate should have adopted the reasoning of the NSW Supreme Court in Owners Corporation Strata Plan 72535 v Brookfield [2012] NSWSC 712 and found that there was no real question to be tried and that the Plaintiff had no prospect of success.
4.   The learned Magistrate erred as a matter of law in finding by implication that, the decision of Bryan v Maloney applied to the facts as pleaded by the Plaintiff.
5.   The learned Magistrate should have found that by reason of the statutory context of the Plaintiff’s claim as a subsequent owner of domestic building work in South Australia, that Bryan v Maloney was distinguishable as there was no equivalent statutory regime in Tasmania at the time of that decision.
6.   Further, the learned Magistrate erred as a matter of law in failing to follow the decision of Master Rice in the District Court of South Australia in Community Corporation 26083 Inc v Marshall & Brougham (Constructions) Pty Ltd (decision 11 of 2015) which was binding upon him and is to the effect that no duty of care exists.
I point out that the Magistrate did not, in his decision, find that a duty of care was owed by the respondent to the applicant nor did he find that the decision of Bryan v Maloney[1] applied to the facts.
[1] (1995) 182 CLR 609.
All that his Honour found was that the law of negligence potentially applied and that it had not been ousted by the enactment of the Building Work Contractors Act 1995 (SA).
The question is whether the Building Work Contractors Act 1995 by implication excludes the common law remedies of negligence in relation to domestic building work contracts.
In my view, it does not.
In Potter v Minahan[2] O’Connor J quoted the principle referred to in J. A. Theobold, Maxwell on the Interpretation of Statutes, 4^th Ed, Sweet & Maxwell, London, 1905, p 121 as follows:
It is in the last degree improbable that the legislature would overthrow fundamental principles, infringe rights, or depart from the general system of law without expressing its intention with irresistible clearness; and to give any such effect to general words, simply because they have that meaning in their widest, or usual or natural sense, would be to give them a meaning in which they were not really used.[3]
[2] (1908) 7 CLR 277.
[3] See O'Connor J at 304.
In Thompson v Australian Capital Television Pty Ltd,[4] Burchett and Ryan JJ said,
Statutory reforms removing a particular plank from the edifice of the common law do not necessarily bring down whole sections of the structure just because a rule expressly changed or abolished had an historical or a logical connection with other rules of the common law. To forbid such a consequence the rule has been established (and should be adhered to: Corporate Affairs Commission (NSW) v Yuill (1991) 172 CLR 319 at 322; 100 ALR 609, per Brennan J) that Acts altering the common law should be construed as doing so only so far as is necessary to give effect to their provisions: Hocking v Western Australian Bank (1909) 9 CLR 738 at 746; American Dairy Queen (Qld) Pty Ltd v Blue Rio Pty Ltd (1981) 147 CLR 677 at 682-; 37 ALR 613, per Mason J, with whom Gibbs CJ, Murphy, Aickin and Brennan JJ agreed; Pearce and Geddes on Statutory Interpretation in Australia (3rd ed, 1988), 104-105; or as Lord Reid put it in Black-Clawson International Ltd v Papierwerke Waidhof-Aschaffenburg Aktiengesellschaft AG [1975] AC 591 at 614, "in the absence of any clear indication to the contrary Parliament can be presumed not to have altered the common law further than was necessary to remedy the 'mischief"'.
[4] (1994) 54 FCR 513; 127 ALR 317 at 329.
The applicant relies on a decision of McDougall J of the Supreme Court of NSW in Owners Corporation Strata Plan 72535 v Brookfield.[5] That case is distinguishable because his Honour was delivering a final judgment after the tendering of evidence i.e. it was a judgment on the facts.
[5] [2012] NSWSC 712.
In that case an issue arose of whether a common law duty of care was owed to an Owners Corporation by the designer and constructor of a building alleged to have defects. His Honour’s decision was in the context of that particular case and on the basis of the evidence presented in that particular case.
The issue for me here, as a matter of law, is not whether a duty of care existed in fact. The question is whether a duty of care might potentially exist in favour of the respondent. It is not clear that his Honour was answering that question.
His Honour said,
In circumstances where the legislature has considered, and made clear provisions for, the extent to which a builder is liable to a subsequent owner, I think that the courts should be slow to substitute their own judgment for that of the legislature. Certainly, I do not think that it is open to a trial judge to hold that some additional common law duty of care should be imposed.[6]
[6] See para 144.
With respect to his Honour, I do not think it is a question of whether it is open to a trial judge to hold that some additional common law duty of care should be imposed. A duty of care is imposed by law. It is the law that determines whether a duty is imposed in certain factual situations and it is for the Judge to determine whether a particular case comes within the factual situation that leads to it being imposed.
His Honour’s second reason for concluding that there was no duty of care was that his Honour said that the concept of proximity as discussed in Bryan v Maloney has been discarded as the basis for the imposition of a duty of care. So much is clear from cases such as Sullivan v Moody; Thompson v Connor[7] and Woolcock Street Investments Pty Ltd v CDG Pty Ltd.[8]
[7] (2001) 207 CLR 562.
[8] (2004) 216 CLR 515.
This is not, however, an issue which was before the Magistrate nor is it the subject of any appeal before me. A duty of care imposed is based on the facts and no application has been made in this case that on the facts pleaded there could not possibly be any duty of care. The sole ground for asserting such a duty of care is excluded is that the enactment of the Building Work Contractors Act 1995 impliedly excludes it.
The third basis for his Honour’s conclusion that there was no duty of care was clearly based on the facts in that case[9] which are relevantly different to the case before me.
[9] See para 147.
The applicant also relied on a decision of Master Rice in Community Corporation 26038 Inc v Marshall & Brougham (Constructions) Pty Ltd. This was an application to strike out proceedings and grant summary judgment.
His Honour dismissed the claim of the plaintiff in negligence in that case on the basis that as a matter of law there is no duty of care owed to the plaintiff by the defendant. His Honour ruled that there was no duty of care in negligence relying on the decision of Owners Corporation Strata Plan 72535 v Brookfield.[10]
[10] See para 148.
For the reasons I have already discussed I do not agree that that case is authority for the proposition that no duty of care can possibly be owed by a builder in relation to the person for whom the building is built, or his successors in title.
Accordingly, it is in my view open for the respondent to argue that he was owed a duty of care by the applicant whatever that duty of care might be and whatever the legal principles upon which its imposition is based.
Accordingly, I agree with the decision of the learned Magistrate and I confirm his decision dismissing the application by the applicant to strike out the pleadings in the Magistrates Court and to grant summary judgment.