Maxwell-Smith v S & E Hall Pty Ltd - [2002] FCA 25

FEDERAL COURT OF AUSTRALIA
Maxwell-Smith v S & E Hall Pty Ltd [2002] FCA 25
PRACTICE AND PROCEDURE – issue estoppel and res judicata – applications under Trade Practices Act 1974 in relation to building dispute – whether applications seek to relitigate matters decided by Consumer Claims Tribunal and Supreme Court – elements of Federal Court proceedings have been determined between parties – motion for dismissal under Order 20 Rule 2 allowed.
BANKRUPTCY – applications to set aside bankruptcy notice dismissed.
Bankruptcy Act 1966 (Cth)
Consumer Claims Tribunals Act 1976 (NSW)
Trade Practices Act 1974 (Cth) s51AB, s52
Port of Melbourne Authority v Anshun (1981) 147 CLR 589 referred to and applied
Henderson v Henderson (1843) 5 Hare 100; 67 ER 313 referred to
Wentworth v Rogers (1986) 6 NSWLR 534 referred to
Cabassi v Vila (1940) 64 CLR 130 referred to
Bright v Bright [1954] P 270 referred to
Spencer Bower, Turner and Handley Res Judicata (3^rd Ed) par [182]
Eugene and Inge Maxwell Smith v S & E Hall Pty Ltd
N895, N896, N7225 and N7226 of 2001
ALLSOP J
SYDNEY
25 JANUARY 2002

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

N7225 and N7226 of 2001

BETWEEN:

EUGENE AND INGE MAXWELL-SMITH
APPLICANTS

AND:

S & E HALL PTY LTD
RESPONDENT

JUDGE:

ALLSOP J

DATE OF ORDER:

25 JANUARY 2002

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:
1.the applications in the matters numbered N7225 and N7226 of 2001 filed 4 May 2001 seeking to set aside the bankruptcy notice dated 26 March 2001 and addressed to the applicants be dismissed; and
2.the applicants (Mr and Mrs Maxwell-Smith) pay the costs of the respondent to the applications.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

N895 and N896 of 2001

BETWEEN:

EUGENE AND INGE MAXWELL-SMITH
APPLICANTS

AND:

S & E HALL PTY LTD
RESPONDENT

JUDGE:

ALLSOP J

DATE OF ORDER:

25 JANUARY 2002

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:
1.the applications in matters numbered N895 and N896 of 2001 be dismissed; and
2.the applicants to the proceedings (Mr and Mrs Maxwell-Smith) pay the costs of the respondent to the proceedings, including the costs of the motions brought by the respondent for orders under Order 20 Rule 2.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

N895 and N896 of 2001

BETWEEN:

EUGENE AND INGE MAXWELL-SMITH
APPLICANTS

AND:

S & E HALL PTY LTD
RESPONDENT

JUDGE:

ALLSOP J

DATE:

25 JANUARY 2002

PLACE:

SYDNEY

REASONS FOR JUDGMENT

There are a number of matters before me for resolution. These matters have a relationship to each other.
On 26 March 2001 a bankruptcy notice was issued by the Official Receiver for the Bankruptcy District of New South Wales and the Australian Capital Territory at the request of…

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 Maxwell-Smith v S & E Hall Pty Ltd

Details

AGLC: Maxwell-Smith v S & E Hall Pty Ltd [2002] FCA 25
Case: [2002] FCA 25
Decision Date: 25 JANUARY 2002

CaseChat Overview and Summary

The matter of Maxwell-Smith v S & E Hall Pty Ltd involved a dispute between the Maxwell-Smiths, who were the clients, and S & E Hall Pty Ltd, the contractor, regarding the completion and quality of a construction project. The case was heard by the Federal Court of Australia, which was tasked with determining whether the contractor was entitled to payment for the work completed and whether the bankruptcy notice served on the clients was valid.

The court had to decide whether the inspector's report, which was not available at earlier stages of the proceedings, could be considered as conclusive evidence. Additionally, the court had to determine if there were any improprieties on the part of the solicitor representing the contractor, who had previously represented the clients in other matters. The court also had to consider whether the clients had acted in bad faith by attempting to relitigate issues that had already been decided by the Tribunal.

In its reasoning, the court held that the inspector's report could be considered as conclusive evidence, even though it was not available at earlier stages of the proceedings. The court found that there were no improprieties on the part of the solicitor, as the assistance provided to the contractor during the Tribunal hearing was not relevant to the issues before the court. The court also held that the clients had not acted in bad faith by attempting to relitigate issues that had already been decided by the Tribunal. The court dismissed the applications seeking to set aside the bankruptcy notice and ordered the clients to pay the costs of the proceedings.

The court's final orders were that the applications seeking to set aside the bankruptcy notice be dismissed, and that the clients pay the costs of the proceedings, including the costs of the motions brought by the contractor.

Orders

Orders of the court

1. the applications in the matters numbered N7225 and N7226 of 2001 filed 4 May 2001 seeking to set aside the bankruptcy notice dated 26 March 2001 and addressed to the applicants be dismissed; and

2. the applicants (Mr and Mrs Maxwell-Smith) pay the costs of the respondent to the applications.

1. the applications in matters numbered N895 and N896 of 2001 be dismissed; and

2. the applicants to the proceedings (Mr and Mrs Maxwell-Smith) pay the costs of the respondent to the proceedings, including the costs of the motions brought by the respondent for orders under Order 20 Rule 2.

Background

Background to the litigation

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Evidence

Evidence Before The Court

In 4., “Evidence not available at preceeding hearings”, the inspector’s report is identified as the “conclusive evidence”. These submissions contained the following.4Evidence not available at preceeding hearingsa. In the Reserved Decision BWO96/51 of 29 August ’97, the Tribunal Referee says in relation to the unfinished work, “Accordingly, I consider it fair and equitable to allow against the amount otherwise made out by the claimant (Hall) a total of $.596.50 for matters requiring rectification.” (page 5)b. In the Judgment from Justice G James of 8 Dec. ’98 in the Judicial Review, his Honour says, “The evidence before me does not allow me to conclude the result was so unreasonable as to show a breach of natural justice in itself. (final par. page 11.)c. The conclusive evidence from the Department was also not available at the Leave for Appeal.d. The vital evidence from the Department, that became available in Aug 1999, is the pivotal issue on which to decide whether or not Hall was entitled to his claim for payment.e. Although the evidence was available towards the end of the proceedings of the Special Leave for Appeal, Warren did not allow this evidence to be presented to the Hight Court.[emphasis added] Allegations of impropriety are made against the Creditor’s solicitor in 5., “Conflict of Interest”:5.Conflict of interesta. The Maxwells were clients of White from Sautelle & White before and during the construction of their home by Hall. If this fact is challenged by White, the Client Service Agreement and accounts rendered by White are available for filing.b. White actively assisted Hall during the Tribunal hearing and represented Hall in all proceedings. That alone is insufficient to raise any impropriety. It is on its face irrelevant to the issues before me. The matters in 6., “Cost Saving Resolution Process” are irrelevant. They are as follows:6.Cost saving Resolution Processes.a. The Maxwells offered their willingness to resolve the dispute with Hall by mediation, before the commencement of the 2nd Tribunal hearing. (letter to Department 31 December 1996,)b. The Maxwells tried to minimize the cost of litigation by requesting the Leave for Appeal to be heard in chambers.c. The Maxwells are also prepared to resolve the Bankruptcy matter by mediation. (Their affidavits filed on 15 May item 17.)d. The Maxwells said before Justice Allsop on 17 July, that they are prepared to have the matter of the Notice of Bankruptcy and the Application of the Crossclaim decided in chambers. I have already referred to 7. (See [45] above.) That the object of the Federal Court proceedings is to relitigate the very issues decided in the Tribunal is not able to be seen with precision from a comparison of the Departmental inspector’s report and the (second) decision of the Tribunal. This is so because the Tribunal did not itemise each and every matter in dispute and the subject of its conclusions. However, there is nothing to suggest in the evidence or submissions before me that the areas of focus for the allegations of inadequate or incomplete building work changed such that the inspector’s report was dealing with different matters or from a different perspective than as contained in the Tribunal decision. To the contrary, the thrust or gravamen of the Maxwell-Smiths’ case is that the inspector’s report reveals and illuminates the very errors committed by the Tribunal which errors were brought about by the knowingly false claims of the Creditor and the false and collusive evidence of the Halls and others.

Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N7225 and N7226 of 2001

BETWEEN:	EUGENE AND INGE MAXWELL-SMITH APPLICANTS
AND:	S & E HALL PTY LTD RESPONDENT
JUDGE:	ALLSOP J
DATE OF ORDER:	25 JANUARY 2002
WHERE MADE:	SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N895 and N896 of 2001

JUDGE:	ALLSOP J
DATE:	25 JANUARY 2002
PLACE:	SYDNEY