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Miles v Palm Bridge Pty Ltd

Miles v Palm Bridge Pty Ltd

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MILES & ANOR -v- PALM BRIDGE PTY LTD [2001] WASC 42

Jurisdiction:	SUPREME COURT OF WESTERN AUSTRALIA	Citation No:	[2001] WASC 42
Case No:	ARB:14/2000	Heard:	16 JANUARY 2001
Coram:	HASLUCK J	Delivered:	20/02/01
No of pages:	22	Judgment Part:	1 of 1
Result:	Appeal allowed
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Parties:	FREDERICK LAURENCE MILES FAY LORRAINE MILES PALM BRIDGE PTY LTD
Catchwords:	Commercial arbitration Leave to appeal Costs of arbitration Arbitrator's discretion concerning award of costs Building contract for residential premises Identification of successful party in case involving claims and cross-claims Application of rule that successful party is the party who secures a judgment for the balance
Legislation:	Commercial Arbitration Act 1985, s 34, s 38
Case References:	Badge Constructions Pty Ltd v Penbury Coast Pty Ltd [1999] SASC 6 Carpaolo Nominees Pty Ltd v Marrosan Nominees Pty Ltd (1997) 112 NTR 1 D Phillips Constructions (Vic) Pty Ltd v Mullavey [1980] VR 171 Garner v Rohanna Pty Ltd [1999] WASCA 178 John Hollywood Pty Ltd v Ng, unreported; SCt of WA (Acting Master Hawkins); Library No; 920239; 28 April 1992 Keywest Construction Group Pty Ltd v Footscray Holdings Pty Ltd, unreported; SCt of WA (Anderson J); Library No 930078; 23 February 1993 Leighton Contractors Ltd v Western Australian Government Railways Commission (1966) 115 CLR 575 LNC Harper Davidson Pty Ltd v Keywest Building Co Pty Ltd, unreported; SCt of WA (Kennedy J); Library No 7192; 13 July 1988 Oshlack v Richmond River Council (1998) 193 CLR 72 Rival Nominees Pty Ltd v Craig Davis Constructions Pty Ltd, unreported; FCt SCt of Vic; 26 June 1981 Scherer & Anor v Counting Instruments Ltd [1986] 1 WLR 615 Tuta Products Pty Ltd v Hutcherson Bros Pty Ltd (1972) 127 CLR 253 Warley Pty Ltd v Adco Constructions Pty Ltd (1988) 8 BCL 300 Angelatos v Alternative Constructions Pty Ltd, unreported; FCt SCt of Vic; 30 November 1992 Berbett Pty Ltd v Hansa [1976] VR 385 BMD Constructions Pty Ltd v Golding Contractors Pty Ltd [2000] QSC 057 Commonwealth of Australia & Anor v Rian Financial Services and Developments Pty Ltd (1992) 36 FCR 101 Crewford Pty Ltd v Transit Australia Pty Ltd, unreported; SCCA Qld; 23 March 1999 Cummings v Lewis (1993) 41 FCR 559 Donald Campbell & Company Ltd v Pollak [1927] AC 732 Exxon Coal Australia Ltd v Chadtech Pty Ltd [1999] NSWSC 574 Gaymark Investments Pty Ltd v Walter Construction Group Ltd [1999] NTSC 143 Godden v Alford [1960] WAR 235 Gold v Patman & Fotheringham Ltd [1958] 2 All ER 497 Kleerstyle Homes (A firm) v Dickson & Anor, unreported; SCt Qld (Williams J); 16 September 1997 MacKinnon v Peterson, unreported SCt of NSW (Cole J); 19 April 1989 MASAWA Australasia Pty Ltd v J Corp Pty Ltd & Anor [2000] WASC 5 Natoli v Walker, unreported; SCCA NSW; 26 May 1994 Nicholson v Little [1956] 2 All ER 699 Promenade Investments Pty Ltd v New South Wales (1992) 26 NSWLR 203 Re Caf-Grains [1994] 2 Qd R 252

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: [2001] WASC 42
Decision Date

CaseChat Overview and Summary

This is an application for leave to appeal brought pursuant to the provisions of the Commercial Arbitration Act 1985. The applicant, Frederick Laurence Miles, is a builder. The respondent, Palm Bridge Pty Ltd, is the owner of land on which a residential premises was to be constructed. The builder brought a claim in arbitration against the owner for a sum of money said to be due to the builder under the building contract. The owner, in turn, brought a counterclaim for damages. The Arbitrator awarded the builder the sum of $97,733.63 and ordered that the builder's costs be paid by the owner. The owner applied to the Supreme Court to have the Arbitrator's award set aside and, in the alternative, that the question of costs be remitted to the Arbitrator for reconsideration. The builder applied for leave to appeal the Supreme Court's refusal to set aside the Arbitrator's award. The builder's grounds of appeal included the contention that the Arbitrator erred in law in failing to apply the rule that the party ultimately successful on a final balance of claim and counterclaim in an arbitration over building works should be awarded its costs. The owner submitted that there was no manifest error of law arising from the award on the face of the award. Counsel for the owner emphasised that any discussion concerning an error of that description should be confined to the terms of the award itself. The builder submitted that leave to appeal should be granted because there was a manifest error of law in that the Arbitrator applied the wrong test in determining the issue as to costs. The Arbitrator's ruling had implications for other arbitrations in which claims and cross-claims and a variety of issues were under consideration and therefore a determination as to how costs should be awarded in such circumstances would add substantially to the certainty of commercial law in regard to controversies of this kind. The court found that the Arbitrator misconceived the task before him. In the circumstances of the present case, in order to exercise his discretion judicially, he was obliged to identify the successful party having regard to the principle that in the context of claims and cross-claims the successful party will generally be the party securing the final flow of money. The court found that the builder was placed at a disadvantage in that the Arbitrator did not give proper weight to the builder's prima facie entitlement to an exercise of the discretion in his favour. It followed that there was a manifest error of law on the face of the award. The court allowed the builder leave to appeal pursuant to s 38(5)(b)(i) of the Commercial Arbitration Act. The court also allowed the builder leave to appeal pursuant to s 38(5)(b)(ii). It followed from earlier discussion that, in the court's view, the builder was entitled to obtain leave to appeal pursuant to s 38(5)(b)(ii). It follows from earlier discussion that, in the court's view, the Arbitrator made an error law in his application of the relevant principles. Building disputes of this kind in which there is a variety of claims and cross-claims to be considered are a frequent occurrence and the court therefore considered that a ruling upon the approach adopted by the Arbitrator may add, or may be likely to add, substantially to the certainty of commercial law in this area. If leave to appeal is granted upon this basis, it follows from earlier observations that, in the court's view, the grounds of appeal relied on have been established with the result that the appeal should be allowed. The court will hear from the parties as to the precise orders to be made.

Orders