Niquet v Niquet and Niquet No. DCCIV-99-707

SELECTA HOMES & BUILDING CO. PTY. LTD V ADVERTISER-NEWS WEEKEND PUBLISHING CO. PTY. LTD.
[2000] SADC 126

Judge D. Bright
Civil

The plaintiff, a builder of transportable houses, claims to have been libelled by the defendant, which publishes a newspaper, the Sunday Mail. It published a letter from a customer of the plaintiff who was not satisfied with her house. Originally the customer was also sued, but she was released from the action during the trial.
The letter was published by the defendant on 22nd February, 1998. It was in the following terms:-

“Lack of pride in product
I AGREE wholeheartedly with “Going out of business” (Sunday Mail, 8/2/98):   We have recently had the misfortune to purchase a new transportable home from a company, whose total lack of pride in workmanship and presentation has been unbelievable.
And, how dare we, the client, who has handed over a large sum of hard-earned money, complain.   Our complaints were treated with absolute contempt and arrogance.   It is too late for us, but if anyone is buying a transportable home, make sure you go over it with a fine-tooth comb on delivery, because anything not noticed on the day of hand over ultimately will be blamed on the purchaser.
The standard set by some of these unscrupulous builders is supposedly within the incredibly broad guidelines of the building industry.   It makes you wonder who sets the “guidelines”.
Winning the Design of the Year Award for transportable homes from the Housing Industry Association does not guarantee the quality of workmanship one would expect.
K FERRIER,    Berri”

There was no attention grabbing headline, nor anything unusual in the way the letter was set out, to mark it from the general run of letters published that day.
The earlier letter referred to was published by the defendant on 14th February 1998, and was in the following terms:

“Going out of business
To owner-operators and small business proprietors here in SA, before you start blaming the pokies, the Government, the welfare system, and anything or anybody else for the collapse of your business, look to yourselves and how you treat customers.
In the past three months, I have had dealings with a plastics company, a mobile alternator firm, and a plumber. In all three cases, the scenario has been poor workmanship, tardiness, non-delivery of goods, even though payment was up front, and a complete lack of interest in me, the client, and my needs.
Now, while I am well aware there are many companies and small business people who bend over backwards to do the best for their clients, there are also those who couldn’t care less. These same people will bleat and bemoan their “bad luck” once their businesses have gone down the tube. Their attitude when you do make a complaint is one of absolute disbelief the client could dare question them or their work. As a mobile hairdresser running my own business, if I treated my clients with the contempt and even one quarter of the disrespect with which I have been, I simply would not have a business.
NAME, ADDRESS SUPPLIED”

The Sunday Mail, at the time, had a circulation of about 800,000 readers in South Australia.
It will be noted that the letter complained of does not identify the plaintiff by name. A little extrinsic knowledge is needed. The last sentence refers to winning the Design of the Year Award for transportable homes from the Housing Industry Association. The plaintiff had won that award on 27th October 1997. It was the only builder of transportable homes to do so. It was the plaintiff’s practice to advertise in various periodicals circulating in South Australia, including the Sunday Mail. After winning the award, the plaintiff included prominent reference to winning the award in its advertisements.
The market for transportable homes in South Australia is supplied by 7 builders. It is not a large market. It has total sales of, usually, less that 40 houses per month. More people than that inspect such homes and make enquiries about them, though not, ultimately, purchasing. No doubt, competitors keep an eye on each other. This group of people is likely to have paid attention to advertisements for transportable houses. Some would have seen the plaintiff’s advertisements. Others would have attended at the plaintiff’s display area, where, again, reference to the award was prominent. In addition, some other casual readers of the periodicals in which the plaintiff advertised would have noticed the advertisements. I expect that, for example, the immediate family of a person contemplating the purchase of a transportable house would be more alert than otherwise to publicity about them.
It is reasonable to presume that some people in this group (but not all) would also have seen the letter. In my view, people with this sort of interest in the subject matter of transportable houses would have had no trouble identifying the plaintiff. Significantly, many of those likely to identify the plaintiff would be those most likely to be in the market to buy from the plaintiff. Of course it cannot be proved how many potential customers were so aware.
At least two competitors placed copies of the letter in their display centres, helpfully advising that it did not refer to them. Potential customers who were “doing the rounds” of transportable home displays are quite likely to have seen them - so some more potential customers of the plaintiff are likely to have become aware of the letter, though not seeing the original publication. This limited secondary publication seems to me entirely foreseeable.
Insofar as I must be satisfied not of what I would, on balance, expect, but that some identified person actually made the link between the letter and the plaintiff, I heard from Miss Price, who had been interested in houses and had seen the plaintiff’s advertisement. She asked the plaintiff whether they were the subject of the letter. She said that she “assumed” they were. By the use of that word, I took her to mean that she identified the plaintiff as being the subject of the letter. She did not say that she rang around the seven suppliers in a spirit of pure inquiry - she believed she knew the answer. While an even more definite identification would have been better, I believe this was enough to comply with the technical requirement to prove that extrinsic evidence actually led to identification of the plaintiff.
Having crossed that threshold, I conclude that, within days of the publication (apart from those copies displayed by competitors), virtually all copies of that issue of the paper would have been disposed of. I expect that oral publication within that group of potential buyers and their associates would have continued for a while, quite possibly encouraged by competitors.
I have no basis to be at all precise, but I envisage that the total number of people, including joint potential purchasers, who became aware of the letter and who are likely to have identified the plaintiff as its subject, would not have exceeded one or two hundred. The vast majority of the readers of the Sunday Mail, if they read the letter at all, are unlikely to have identified its subject. Nor are they likely to have recalled the earlier letter referred to in any detail - in most cases, at all.
The terms of the letter were obviously defamatory. At least some damage can be presumed. At this basic level, the letter is actionable.
The plaintiff has pleaded the various meanings or imputations to be given to or drawn from the letter. The defendant denies them. It then goes on to assert that if, contrary to its plea, those imputations are made out, it was justified in publishing the letter because they were true. Further, if they were not entirely true, they were partly true and were expressed by the plaintiff too broadly. Only more limited imputations should be drawn from the letter and those more limited imputations were true. The defendant has given particulars of the matters alleged to give rise to the two alternative justifications.
I must return to the facts. Mr. and Mrs. Ferrier contracted to purchase a new transportable house from the plaintiff in June 1997. It was to cost about $53,000. It was to be delivered to a site near Berri. The house was chosen from a portfolio of the plaintiff’s standard designs, but with certain modifications or additions. Choices had to be made of various components and finishes, such as tiles and floor coverings. The plaintiff had arrangements with certain suppliers and sent the Ferriers to, relevantly, branches of Beaumont Tiles and Solomon’s Carpets. The Ferriers selected the paint and cladding for the house. They up-graded to brass hinges, locks and knobs on doors and cupboards.
It was the Ferriers’ responsibility to prepare a site for the house on their block and to ensure appropriate access to that site. They were advised to use compacted dolomite or rubble on the site. The tradesman who prepared the site advised that, as the site was sand, the sand itself could be compacted and that there was no need for rubble or dolomite. No expert evidence was given about which method is preferable. One possible advantage of using fill is that, if water is allowed to run under the house, sand can wash away from the piles on which the house rests more easily than fill. There is no evidence that that occurred. There is no evidence that the site was defective in any relevant way. There was probably some settlement of the house after delivery, but it does not seem to have been beyond what is normal for such a house. Such settlement does not indicate either faulty construction or a faulty site.
The house was 19.2 metres long. The Ferriers’s access road, or drive, had to be improved and undergrowth on either side had to be cleared, or tied back. That was done.
On about 19th August 1997 the house was delivered (by a contractor to the plaintiff). It arrived safely. It is to be expected that there would have been some flexion of the house in transport. It was designed to accommodate that. Some minor cracking may have occurred. At some stage, quite possibly in the course of turning into and travelling up the drive, a branch, or twig, perhaps as thick as a finger, caught and lodged in the end of a roof gutter, scratching and slightly denting it.
On the day of delivery, the house was installed on its various piles and the delivery men left. The house was not formally handed over to the Ferriers that day, though they were permitted to enter and inspect their new house. Formal hand-over took place the next day when Mr. Inman, an employee of the plaintiff, attended. It was his task to go through the house, installing the various flywire screens which had travelled inside the house, untaping doors and cupboard doors which had been taped shut and generally preparing the house for hand over.
It was his task to get the Ferriers to sign the certificate of practical completion before hand over. That involved going through the house with the Ferriers, noting down any defects which needed attention. He did that, advising the Ferriers that they did not need to be too fussy about it as there was a three month warranty, that other defects would be noticed later and that the plaintiff would attend to such defects. It was the plaintiff’s practice to attend to urgent matters at once, but generally to await the end of the three months period, at which time it would attend to problems. This gave the house a chance to settle and for problems to be detected. Probably this practice was not made clear to the Ferriers.
In the event, no structural faults were found then, or at any time. Two lavatory pans were not stuck to the floor. They had been set on a mortar bed, but came loose. This was unusual, but not unprecedented - flexion of the house in transport might be the cause. In any event, it was easy to fix. Later, some seepage to the underside of the lavatory floors was noticed. It is not clear whether this was associated with the loose pans, or whether the moisture was leaking from a joint on the outlet pipe, or from water leaking down the outside of that pipe as it passed through the floor. It had to be fixed by the plaintiff.
The Ferriers and Mr. Inman prepared a list of the matters they noticed. That list is part of Exhibit D24. The items recorded are as follows. I comment on each.
1. “1818 Screen missing”
This refers to a missing fly wire screen to a window. No dispute.
2. “Shelf lugs in kitchen cupboards missing”
This refers to the absence of two of the four little pegs that supported a shelf in a cupboard. No dispute.
3. “Wrong colour caulking used in bathroom”
The caulking selected by the tiler, while possibly aesthetically acceptable to some, was not to the Ferriers. They were not unreasonable in this.
4. “General Gyprock repairs required”
There is no dispute that there were various minor blemishes and faults that needed attention.
“Joiner short Dining/BR door”
Movement joints between the gyprock sheets on the interior walls were masked by plastic “H” sections. One “H” section was too short. Either it had slid up into the ceiling, or it was cut too short. It needed to be fixed.
5. “Front door lock key not working”
Agreed. As delivered, the external locks were designed to be operated by a “builder’s key”. On hand over, simply inserting the owner’s key should alter the cylinder so that the builder’s key no longer worked, but the owner’s did. For some reason the change over did not work. It needed to be fixed . It was not a problem detectable in advance.
6. Cracked tile in Kitchen”
No dispute. A tile needed to be replaced. Perhaps it cracked in transit. The plaintiff sent up a number of spare tiles with the house.
7. “Lugs S/D broken”
This refers to lugs which retain a sliding aluminium frame door in its track. When they broke is not known - it could have happened in transit. It needed to be fixed.
8. “Gutter ends - one end slightly damaged”
I have mentioned this.
9. “Touch up paint outside/inside”
Agreed. The plaintiff had sent up a certain amount of paint (probably a litre or so) of the main colours.
10. “Dummy sets scratched”
This refers to brass knobs on a cupboard, which showed fine scratches. How they got there is not known, but the plaintiff agreed to replace them.
Up to this stage, it seems that the employees of the plaintiff who dealt with the Ferriers and the Ferriers were having no particular problems with each other of any note. The Ferriers had been disappointed with the tidiness of the house as delivered. They recall used drink cans, cigarettes and food wrappers in the house. They recall scraps of carpet lying around. Mr. Inman tidied the house before hand over. He recalls one can, standing in the laundry. He infers that, because it was standing, it may have been put there after delivery. He recalls one cigarette - not one stubbed out where he found it, but, apparently, carried in on a shoe, again, perhaps, after delivery. He unwrapped flyscreens which had been wrapped in plastic and used that plastic as a repository for the various bits of tape and other plastic he removed. He collected the can and the butt.
He did not attempt to vacuum the carpet. He said that it was not appropriate to vacuum a newly laid carpet in case glued joints were damaged. The carpet was laid just before delivery. He agreed that there were scraps and fluff associated with laying. There were also larger pieces left to be used as temporary runners, or even to be made into mats.
It might be good P.R. for the plaintiff to employ a cleaner to tidy up on delivery. It would have been sensible to have inspected the house before it left the yard. Mr. Ling, the managing director of the plaintiff, told me that he largely relied on customers to tell him if anything was wrong. Against their high hopes, I can understand the Ferriers being a bit annoyed, but, by hand over, that was all the lack of tidiness was, a minor cause for annoyance.
The certificate of practical completion is dated 20th August 1997. There were then some delays until the Ferriers’ plumber could connect up the plumbing. The Ferriers moved in on 11th September 1999. They had moved their possessions in over preceding days.
About a day later, Mr. Phill Donald, the plaintiff’s general maintenance man, telephoned to advise that he would be in the area the following week and to enquire whether there were matters for him to attend to. This led the Ferriers to prepare Exhibit D43, a further list incorporated into a letter dated 15th September 1997 to the plaintiff. This was much more detailed than the previous list. To some extent, general problems such as “blemishes in gyprock”, had been separated into separate blemishes, room by room. There were also further problems not previously noted.
The letter was expressed in strong terms.   There had been no indication the plaintiff would not attend to its obligations.   Later events appear to be coloured by antipathy between the Ferriers and Mr. Ling.   There was no reason for it yet, so the tone is odd.   I set it out.
“  P.O. Box 311,
Berri, S.A. 5343
15th September, 1997
Dear Paul,
We finally shifted into our house last Thursday and regrettably the home you delivered is nothing like your display homes.   We are very disappointed with the quality of workmanship which is appalling.   Listed below are problems which need to be rectified.
Ensuite
Light only comes on if exhaust fan is on.
Floor tiles uneven leading to drain - Frieze tiles not around at floor level.
Plaster under window disgusting.
Main Bedroom
Doorway marked.
Plaster work.
W.I.R.
Stain on wall behind door.
Plasterwork.
Dining Room
New sliding screen door needed - locks do not line up.
Frame on sliding door damaged.
Lounge
Keys for front door don’t work in lock.
Door frame marked.
Front door - stain missed in places.
Living/Family
Flyscreen bent.
Kitchen
Shelf support missing above rangehood,

[2000] SADC 125

11 October 2000