McIntyre v Quality Roofing Services Pty Ltd - [2019] SASCFC 29

Supreme Court of South Australia
(Full Court)
MCINTYRE & ANOR v QUALITY ROOFING SERVICES PTY LTD
[2019] SASCFC 29
Judgment of The Full Court
(The Honourable Justice Parker, The Honourable Justice Lovell and The Honourable Auxiliary Justice Tilmouth)
3 April 2019
APPEAL AND NEW TRIAL - APPEAL - PRACTICE AND PROCEDURE - SOUTH AUSTRALIA
CONTRACTS - GENERAL CONTRACTUAL PRINCIPLES - CONSTRUCTION AND INTERPRETATION OF CONTRACTS
The appellants contend the trial judge erred in concluding that a building agreement was for 'two separate verandahs’ and 'consequently ... that what had been built was in accordance with the agreed design', in concluding the contract could be completed in accordance with that agreement, in making a costs indemnity order in respect of collateral proceedings in the Environment Resources and Development Court against them, and in failing to award damages on their counterclaim for rectification.
Held: Allowing the appeal:
1: The conclusion of the trial judge to the effect that the contractual documents made it clear what was contemplated were two separate verandahs, is set aside as inconsistent with the proper construction of those documents, and unsupported by other evidence in the case.
2. Since the conclusion that the contract could be completed in accordance with the agreement was dependent on the conclusion that a final design was not agreed upon, it must be set aside, and it was in any case based on a proposal that was not in accordance with the contractual arrangements.
3. In making the award for indemnity costs, the judge failed to identify precisely what cause of action or what breach of contract gave rise to liability for those damages, to identify the chain of causation linking the two, and did not resolve the rival contentions underpinning the basis for such damages.
4. The appropriate orders are to allow the appeal, set aside the judgment and the orders dismissing the appellants’ cross-action, the orders for interest, the orders for indemnity costs and the costs of the proceedings and to remit for hearing and determination by another judge of the District Court the resolution of the cross-action and counter-claim, the costs of the proceedings in the collateral action, the costs of the trial proceedings and questions of pre and post-judgment interest.
Shepherd v Felt and Textiles of Australia Ltd (1931) 45 CCR 359; Luna Park (NSW) Limited v Tranways Advertising Propriety Limited (1938) 61 CLR 286; Development Act 1993 (SA) s 85; City of Charles Sturt v McIntyre [2014] SAERDC 45; Livingstone v Rawyards Coal Co (1880) 5 App Cas AC 25; Robinson v Harman (1848) 1 Ex 850; Astley v Austrust Ltd (1999) 197 CLR 1; Johnson v Perez (1988) 166 CLR 351; Burns v MAN Automotive (Aust) Pty Ltd (1986) 161 CLR 653; Egan v State Transport Authority (1982) 31 SASR 481; Short v Kalloway (1839) 11 A&E 28, 33; Bellgrove v Eldridge (1954) 90 CLR 613; Carosella v Ginos & Gilbert Pty Ltd (1982) 57 ALJR 315; Day v…

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.

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Details

Case: [2019] SASCFC 29
Decision Date: 3 April 2019

CaseChat Overview and Summary

This matter concerned an appeal from a decision of the District Court of South Australia. The appeal was brought by the McIntyres against Quality Roofing Services Pty Ltd (QRS). The dispute arose from building work undertaken by QRS for the McIntyres, where QRS had been awarded judgment for a quantum meruit claim.

The legal issues before the Full Court of the Supreme Court of South Australia included whether the trial judge erred in allowing QRS's quantum meruit claim, given that QRS held a building licence limited to specific types of work, which did not appear to encompass the enclosed structure that was built. The court also considered the implications of the limitations on Mr Barry's supervisory registration and the definition of a verandah within the Australian Building Standards.

The Full Court found that the trial judge's decision to allow the quantum meruit claim was based on an incorrect premise regarding the scope of QRS's licence and the nature of the work performed. The court noted that QRS's licence was restricted to "plumbing, fencing excluding brick and brush, carports, pergolas and verandahs," with verandahs defined as "open or partly open." The structure built was implicitly found not to be a verandah within this definition. Consequently, the appeal was allowed.

The judgment in favour of QRS for $27,403 was set aside, as were the orders dismissing the McIntyres’ cross-action and all orders relating to interest and costs. The matter was remitted to another judge of the District Court for the hearing and determination of the McIntyres’ cross-action and counterclaim, as well as all outstanding issues concerning the costs of the proceedings in the various courts and questions of pre and post-judgment interest. The parties were given liberty to make submissions regarding the costs of the appeal.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

Given the above conclusions, it is unnecessary to enter into an analysis of the notices of alternative contention filed by QRS. It is sufficient to observe that the trial judge allowed the quantum meruit claim despite the fact that QRS was not licenced to construct enclosed structures, on the basis of well-established authority: Pavey & Matthews Pty Ltd v Paul,[71] Nunkuwarrin Yunti of SA Inc v A L Seeley Constructions Pty Ltd.[72] It transpires that QRS held a building licence pursuant to the Building Work Contractors Act 1995 (SA) limited to ‘plumbing, fencing excluding brick and brush, carports, pergolas and verandahs’. By reference to a glossary contained within the Australian Building Standards, the licence to build verandahs was limited to those which were ‘open or partly open’. Her Honour made findings to this effect.[73] She also found that Mr Barry was the holder of building works supervisory registration with limitations.[74] There is an implicit finding in any event to the effect that the structure as built, was not a verandah falling within the definition contained in the Australian Building Standards.[75] Equally, it is unnecessary to consider the bases upon which her Honour made the various interest and costs orders that she did.[71] (1987) 162 CLR 221.[72] (1998) 72 SASR 21, [23].[73] Quality Roofing Services Pty Ltd v McIntyre [2017] SADC 62, [401].[74] Ibid [402].[75] Ibid [401]-[406].Conclusion and orders For the reasons articulated above, the appeal must be allowed and as a consequence the following orders made:1. The judgment in favour of QRS for $27,403 is set aside;2. The order dismissing the McIntyres’ cross-action is set aside;3. The orders for interest against the McIntyres are set aside;4. The orders in favour of QRS for the costs of the ERD action are set aside;5. The costs orders in favour of QRS are set aside;6. The following issues are remitted for hearing and determination by another judge of the District Court;a. resolution of the McIntyres’ cross-action and counterclaim;b. costs of the proceedings in the ERD Court;c. costs of the proceedings in the Magistrates and District Courts;d. questions of pre and post-judgment interest;7. The McIntyres be at liberty to file and serve written submissions as to the question of costs in this court within 14 days hereof, and QRS be at liberty to file and serve within a further 7 days of service on it, its response thereto.

Ratio Decidendi

Legal Principle Established

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