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Pillay v Lloyd

Pillay v Lloyd

Case [2000] SASC 208 6 July 2000

Mistake of Fact or Law

Contract Law

Corporate Law & Governance

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[2000] SASC 208

PILLAY & PILLAY V LLOYD & ORS; JERVIS & JERVIS V LLOYD & ORS; LLOYD & PILLAY & PILLAY; LLOYD & JERVIS & JERVIS

Full Court: Doyle CJ, Duggan & Lander JJ

DOYLE CJ. I agree with the orders proposed by Lander J, and with the reasons that he gives for the making of those orders. There is nothing that I wish to add.
DUGGAN J. I agree with the orders proposed by Lander J. I also agree with the reasons he has given for his decision.
LANDER J. These appeals involve two separate actions and four different appeals.
Because of an inattention to the appropriate procedures, the matters have become unnecessarily complicated.
Two separate actions have been commenced in which there are common defendants.
In the first action Swamy Pillay and Kanta Pillay are plaintiffs and in the second action Andrew Jervis and Cathy Jervis are plaintiffs. Both Mr and Mrs Pillay and Mr and Mrs Jervis entered into contracts with Blunts Homes Pty Ltd for that company to construct for each of the two families, a home on properties owned by each of them. The defendants were at all relevant times the directors of Blunts Homes Pty Ltd.
Blunts Homes Pty Ltd went into liquidation on 30 August 1994. At that time it was a holder of a licence under the Builders Licensing Act 1986 (the Act).
The plaintiffs in each action filed Particulars of Claim in substantially the same form and for the purpose of these appeals they can be treated as if in the same form.
The plaintiffs claimed that clause 31(d) of the contract into which they entered with Blunts Homes Pty Ltd required the plaintiffs to make progress payments. There was an initial payment of $400 to pay for the preparation of the plan. Thereafter 30 per cent of the contract value became due on commencement by Blunts Homes Pty Ltd of on site work to commence the home. 40 per cent of the contract value became due when the roof was commenced. 25 per cent of the contract value became due on the completion of the second fix carpentry and 5 per cent of the contract value became due on completion and hand over of the home.
In both cases Blunts Homes Pty Ltd performed additional work by way of agreed variations. Those variations are unimportant.
The Act which was repealed by the Building Work Contractors Act 1995 provided in s 25(1)(a) of the Act:
“25(1)...... No person shall demand or require that any payment be made under a domestic building work contract or preliminary work contract by the person for whom work is to be performed under the contract unless the payment -
(a).... constitutes a genuine progress payment in respect of work already performed;”
The Act provides for a penalty of $2,000 for any breach of that section.
The plaintiffs claimed in their original Particulars of Claim that Blunts Homes Pty Ltd breached that section by making demands…

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 Pillay v Lloyd

Details

AGLC: Pillay v Lloyd [2000] SASC 208
Case: [2000] SASC 208
Decision Date: 6 July 2000

CaseChat Overview and Summary

The matter before the Court was an appeal from orders made by a Magistrate in two separate actions involving common defendants. The plaintiffs, Swamy Pillay and Kanta Pillay, and Andrew Jervis and Cathy Jervis, had entered into contracts with Blunts Homes Pty Ltd for the construction of homes on their properties. Blunts Homes Pty Ltd went into liquidation, and the plaintiffs filed claims against the directors of the company, alleging breaches of statutory duty and negligence. The Magistrate struck out the plaintiffs' claims, but allowed them to amend their pleadings. The plaintiffs appealed the Magistrate's decision, and the defendants cross-appealed the Magistrate's decision to allow the plaintiffs to amend their pleadings.

The legal issues before the Court were whether the plaintiffs had a cause of action under the Builders Licensing Act 1986 (SA) for breach of statutory duty and whether the plaintiffs could bring a claim under the Corporations Law (Cth). The Court found that the plaintiffs did not have a cause of action under the Builders Licensing Act 1986 (SA) as there was no statutory right of action against the directors for breach of s 25(1)(a) of the Act. The Court found that the plaintiffs could potentially bring a claim under the Corporations Law (Cth), but their pleadings were insufficient to establish that they were creditors of Blunts Homes Pty Ltd.

The Court held that the Magistrate's decision to allow the plaintiffs to amend their pleadings was inappropriate and that the proper procedure would have been for the Magistrate to hear argument on whether the plaintiffs should be given leave to amend their pleadings and then whether the original pleadings should be struck out. The Court allowed the defendants' appeals, set aside the Magistrate's order allowing the plaintiffs to amend their pleadings, and gave the plaintiffs leave to file further Particulars of Claim within 21 days. The Court ordered that the plaintiffs' appeals be dismissed and the defendants' cross-appeals be allowed. The Court reserved the question of costs for later determination.

Orders