PKF Accounting (SA) Pty Ltd v Michael Gartner - [2007] SADC 16

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
PKF ACCOUNTING (SA) PTY LTD v MICHAEL GARTNER
[2007] SADC 16
Judgment of Her Honour Judge Kelly
27 February 2007
CONTRACTS - GENERAL CONTRACTUAL PRINCIPLES
Claim for professional services rendered by the plaintiff to the defendant. Defendant disputed terms of contract. Contract not reduced to writing. Whether plaintiff had an agreement with defendant. Whether parties agreed on a contingency fee. Whether amount claimed by plaintiff was excessive and unreasonable.
Held, plaintiff did perform work for the defendant pursuant to an agreement between the parties. The amount claimed was not excessive. The plaintiff did not enter into any agreement with the defendant for payment on the basis of a contingency fee arrangement.
The Plaintiff is entitled to judgment in his favour.
Griffiths v Evans [1953] 2 All ER 1364, 1369; Adamson v Williams [2001] QCA 38, discussed.

PKF ACCOUNTING (SA) PTY LTD v MICHAEL GARTNER
[2007] SADC 16

The plaintiff PKF Accounting (SA) Pty Ltd (“PKF”) a firm of Chartered Accountants, claims the sum of seventy eight thousand four hundred and eighty eight dollars and sixty six cents ($78,488.66) for various accounting and advisory work undertaken for the defendant Michael Gartner during the period between November 2004 and up to 31 December 2005.
Michael Gartner (“defendant”) denies liability to pay any money to the plaintiff on a number of bases. In his defence the defendant denies that the plaintiff undertook any accounting or advisory work for him and asserts that:-
·    Any agreement he had was with David Fechner, a Director of PKF, acting in his own right and not with PKF.
·    The defendant entered into an agreement with David Fechner to undertake work for the defendant on a success fee basis. This was agreed at the first meeting between the two men.
·    In the alternative, if any money was owing to the plaintiff then the amount claimed by the plaintiff was far in excess of any work performed, was unreasonable and unsubstantiated.
The plaintiff called only one witness, an accountant named David Fechner (“Fechner”). The defendant gave evidence on his own behalf and called two witnesses, a man named Jason Tranter and Martin Corner.
At the trial the defendant, who appeared for himself, maintained the defence set out in the pleadings, however the issue which really emerged as the main point of contention was whether the defendant engaged Fechner on the basis of a contingency fee payment or on the basis, as Fechner asserted, of services charged at an hourly rate of two hundred and forty dollars ($240) but with extended terms to accommodate the defendant’s then difficulties with cash flow. Another issue which emerged as the evidence unfolded was the purpose for which the defendant had retained Fechner’s services and whether the nature of that retainer changed from time to time after the defendant initially instructed Fechner in November of 2004.
At the outset I observe that it is unfortunate that no proper written record was ever made of the…

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: [2007] SADC 16
Decision Date: 27 February 2007

CaseChat Overview and Summary

The District Court of South Australia heard a case between PKF Accounting (SA) Pty Ltd and Michael Gartner regarding a claim for professional services rendered by PKF to Gartner. Gartner disputed the terms of the contract and whether he had agreed to a contingency fee arrangement. The court found that PKF had indeed performed work for Gartner pursuant to an agreement between the parties and that the amount claimed was not excessive. The court also determined that there was no agreement between the parties for payment on the basis of a contingency fee arrangement.The court based its decision on the credit of the respective witnesses, as there was no written agreement between the parties. The judge found PKF's witness, David Fechner, to be an honest and credible witness. Fechner testified that he charged for his time at the rate of two hundred and forty dollars ($240) per hour and that he had allowed deferred terms for payment to accommodate Gartner's lack of cash flow. The court accepted Fechner's evidence that he had received instructions from Gartner to explore the possibility of refinancing partnership lands and later to concentrate on a proposal to repurchase The Great Stone Winery. The court found Gartner's evidence to be inherently improbable and did not accept his claim that there was an agreement for a contingency fee.The court held that PKF was entitled to judgment in the amount claimed, which was seventy-eight thousand four hundred and eighty-eight dollars and sixty-six cents ($78,488.66). The court will hear the parties regarding interest and costs.

Orders