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Mann v Paterson Constructions Pty Ltd

Mann v Paterson Constructions Pty Ltd

Case [2018] VSCA 313 22 November 2018

Stay of Proceedings

Quantum Meruit

Costs

Civil Litigation & Procedure

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SUPREME COURT OF VICTORIA

COURT OF APPEAL

S APCI 2018 0055

PETER MANN	First applicant
and
ANGELA MANN	Second applicant
v
PATERSON CONSTRUCTIONS PTY LTD (ACN 135 579 770)	Respondent

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JUDGES:	KYROU, McLEISH and HARGRAVE JJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	19 November 2018
DATE OF JUDGMENT:	22 November 2018
MEDIUM NEUTRAL CITATION:	[2018] VSCA 313
JUDGMENT APPEALED FROM:	Mann v Paterson Constructions Pty Ltd [2018] VSC 119 (Cavanough J)

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PRACTICE AND PROCEDURE – Stay – Order of Victorian Civil and Administrative Tribunal requiring applicants to pay to respondent amount calculated on quantum meruit basis – Appeal to Trial Division dismissed – Further appeal to Court of Appeal dismissed – Application made to High Court for special leave to appeal – Application for stay pending hearing and determination of special leave application and any resultant appeal – Application granted on terms including that applicants pay $250,000 to respondent within 28 days.

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APPEARANCES:	Counsel	Solicitors
For the Applicants	Mr T J Margetts QC with Mr A Roe	Telford Story & Associates
For the Respondent	Mr A J Laird	Kalus Kenny Intelex

KYROU JA
McLEISH JA
HARGRAVE JA:

Introduction and summary

On 12 September 2018, this Court published its reasons for dismissing the applicants’ appeal against an order of a judge of the Trial Division which dismissed an appeal from an order made by the Victorian Civil and Administrative Tribunal (‘VCAT’).[1] On the same day, this Court made an order dismissing the appeal from the judge’s order and requiring the applicants to pay the respondent’s costs of the appeal.
[1]Mann v Paterson Constructions Pty Ltd [2018] VSCA 231 (‘Reasons’).

The dispute between the parties arose out of a major domestic building contract pursuant to which the respondent agreed to construct two double-storey townhouses on land owned by the applicants. The townhouses are known as units 1 and 2, 6 Langtree Court, Blackburn. The applicants live with their son in unit 2 and rent out unit 1.

After a lengthy hearing, VCAT found that: the applicants had repudiated the contract; the respondent had determined the contract by accepting the applicants’ repudiation; the respondent was entitled to relief on a quantum meruit basis; and that the relief should be quantified at $660,526.41, representing the value of the work performed by the respondent, less the sums already paid by the applicants and the cost of rectification of defects.[2] Included in that amount was the value of variations to the works that were orally requested by the applicants and performed by the respondent.
[2]Paterson Constructions Pty Ltd v Mann [2016] VCAT 2100 (‘VCAT decision’).

In reaching its decision, VCAT applied this Court’s decision in Sopov v Kane Constructions Pty Ltd (No 2).[3] Sopov held that the remedy of quantum meruit is available to a builder who accepts an owner’s repudiation of a building contract, and set out principles for quantifying the amount payable on a quantum meruit basis. VCAT also proceeded on the basis that s 38 of the

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 Mann v Paterson Constructions Pty Ltd

Details

AGLC: Mann v Paterson Constructions Pty Ltd [2018] VSCA 313
Case: [2018] VSCA 313
Decision Date: 22 November 2018

CaseChat Overview and Summary

Mann brought an action against Paterson Constructions in the County Court of Victoria, claiming damages for defective building work. The case was transferred to the Victorian Civil and Administrative Tribunal (VCAT), which found in favour of Mann and ordered Paterson Constructions to pay damages calculated on a quantum meruit basis. Mann appealed to the Trial Division, and then to the Court of Appeal, both times unsuccessfully. Mann then applied to the High Court for special leave to appeal. Paterson Constructions applied to the Supreme Court for a stay of the operation of the VCAT order pending the outcome of Mann's application for special leave, and any subsequent appeal.

The legal issue before the Supreme Court was whether to grant the stay application. The Court considered the relevant factors, including the merits of the case, the likelihood of success on appeal, the effect of the VCAT order on the respondent, and the interests of justice. The Court noted that the VCAT order was significant and would have a substantial impact on the respondent. The Court also considered that the applicant had a reasonable prospect of success on appeal, and that the interests of justice favoured granting the stay. The Court concluded that it was appropriate to grant the stay application.

In granting the stay, the Court made an order that the stay would be conditional on the applicants paying $250,000 to the respondent within 28 days. The Court noted that this amount represented a substantial proportion of the VCAT order, and was intended to mitigate the effect of the stay on the respondent. The Court considered that this was a reasonable and proportionate response to the circumstances of the case.

No further orders were made by the Court.

Orders