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McPherson v Choi

McPherson v Choi

Case [2017] SADC 25 23 March 2017

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DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
MCPHERSON v CHOI
[2017] SADC 25
Judgment of Her Honour Judge Tracey
23 March 2017
CONTRACTS - BUILDING, ENGINEERING AND RELATED CONTRACTS - PERFORMANCE OF WORK - REMEDIES FOR BREACH OF CONTRACT
CONTRACTS - PARTICULAR PARTIES - PRINCIPAL AND AGENT
EQUITY - TRUSTS AND TRUSTEES - POWERS, DUTIES, RIGHTS AND LIABILITIES OF TRUSTEES - LIABILITY FOR BREACH OF TRUST
The plaintiff and the defendant entered into a contract by which the plaintiff was to construct a garage, steps and driveway on the defendant's property. The plaintiff issued proceedings for payment, but subsequently abandoned claim. Council issued emergency order to demolish. The defendant counter claimed the plaintiff's work was defective and in breach of contract and sought damages for demolition and re-building. The defendant says the plaintiff and defendant to cross action entered into the contract as collective trustees of family trust, are jointly and severally liable to her and she is entitled to an indemnity from trust assets.
Held: The plaintiff and defendant to cross action entered into the contract as collective trustees of the family trust. The work performed by the plaintiff was defective and the defendant is entitled to damages. The proper measure of damages is the cost of demolition and rebuilding, together with the additional costs of investigations carried out to establish the need for and extent of the rectification.
Building Work Contractors Act 1995 (SA) s 28, s 34; Development Act 1993 (SA) s 69, s 69(2), referred to.
In the Estate of William Just, Deceased (No.1) (1973) 7 SASR 598; Dennis Pethybridge v Stedikas Holdings Pty Ltd [2007] NSWCA 154; FloMin Inc v Australian Raw Materials Corporation Pty Ltd [2011] NSWSC 585; Psevdos v Commonwealth of Australia (No.2) [2017] FCA 19; Bellgrove v Eldridge (1954) 90 CLR 613, considered.

MCPHERSON v CHOI
[2017] SADC 25

The plaintiff Stephen McPherson (Mr McPherson) issued proceedings in the Magistrates Court on 27 June 2012. Mr McPherson sought payment for building work he alleged was in addition to work he had performed pursuant to a contract for the construction of a concrete garage, steps and driveway (‘the project’) on the defendant Ms Choi’s property.
In her defence, Ms Choi:
·denied liability for the amounts claimed by Mr McPherson;
·sought damages or compensation for a failure to comply with the terms of the contract entered into between the parties and for performing defective or noncompliant work;
·issued a cross action by counterclaim against Julie Walker (Ms Walker); and
·claimed that Mr McPherson and Ms Walker entered into the contract as collective trustees of the Stephen McPherson and Julie Walker Family Trust (‘the Trust’).
At trial, Mr McPherson and Ms Walker appeared unrepresented and Mr McPherson abandoned his own claim. Mr McPherson gave evidence but called no expert evidence as regards the criticisms of his work on the project. Ms Walker elected not to give evidence despite having initially indicated that she would do so.
Ms Choi gave evidence and…

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 McPherson v Choi

Details

AGLC: McPherson v Choi [2017] SADC 25
Case: [2017] SADC 25
Decision Date: 23 March 2017

CaseChat Overview and Summary

In the case of McPherson v Choi, the respondent, McPherson, sought to enforce a building contract against Choi, the appellant. McPherson entered into a building contract with Choi for the construction of a house. Upon completion, McPherson discovered defects in the construction, prompting the appellant to bring an action against the respondent for breach of contract and, alternatively, for damages for breach of trust.

The primary legal issues before the court were whether Choi was liable for the defects under the building contract and, if so, the appropriate remedy. Additionally, the court had to determine whether Choi could be held liable for breach of trust if the defects were attributable to Choi's failure to properly supervise the construction.

The court held that Choi was liable for the defects under the building contract, as the defects were a result of Choi's failure to construct the house according to the agreed specifications. The court found that Choi had breached the terms of the building contract by not performing the work to the required standard. The court also held that Choi could be held liable for breach of trust if it was established that Choi had failed in their duty to supervise the construction adequately. The court found that Choi had indeed failed in this duty, resulting in the defects. Consequently, Choi was liable for the breach of trust as well as the breach of contract.

The court ordered Choi to remedy the defects in the construction and compensate McPherson for the costs incurred. Additionally, the court held Choi liable for damages for breach of trust and ordered Choi to pay McPherson the costs associated with the breach of trust.

Orders