Plant and Ors v Bellamy

[2009] NSWDC 123

CITATION:	Plant and Ors v Bellamy [2009] NSWDC 123
HEARING DATE(S):	02/03/2009-05/03/2009
JUDGMENT DATE:	12 June 2009
JURISDICTION:	District Court - Civil
JUDGMENT OF:	Sidis DCJ
DECISION:	1 - Verdict and judgment for the plaintiffs in the sum of $112,090.90. 2 - Verdict for the plaintiffs/cross defendants on the cross claim. 3 - The proceedings are listed at 9.30 on 17 June 2009 to deal with issues of interest and costs and the return of exhibits. 4 - My reasons are published.
CATCHWORDS:	Contract - unwritten - dispute as to its terms - plaintiff's entitlement to quantum meruit for work performed - repudiation by defendant of informal agreement for sale of property disentitling him to license fee during period of occupation by plaintiffs
CASES CITED:	Butt v McDonald (1986) 7 QLJ 68
TEXTS CITED:	D W Greig and J L R Davis, The Law of Contract (1987) N C Seddon and M P Ellinghaus, Cheshire & Fifoot’s Law of Contract (8th Australian ed, 2002)
PARTIES:	Mark Lachlan Plant (First Plaintiff and First Cross Defendant) Dale John Plant (Second Plaintiff and Second Cross Defendant) Wayne Anthony Bellamy (Defendant and Cross Claimant)
FILE NUMBER(S):	287/06
COUNSEL:	Mr Rayment and Mr Marshal (First Plaintiff and First Cross Defendant) Mr Rayment and Mr Marshal (Second Plaintiff and Second Cross Defendant) Mr Cummings (Defendant and Cross Claimant)
SOLICITORS:	Bilbie Dan (First Plaintiff and First Cross Defendant) Bilbie Dan (Second Plaintiff and Second Cross Defendant) Graham Barrett & Associates (Defendant and Cross Claimant)

JUDGMENT

1 The proceedings related to arrangements entered into between the plaintiffs and their company and the defendant and his company. The plaintiffs were concretors. The defendant was a developer. The way in which they entered into their various commercial arrangements could be described as casual to the point of negligent. Needless to say, this neglect in attending to those arrangements lead to disputes that were extremely difficult to resolve.

2 Two corporate entities were referred to in the proceedings. Contractors Plant Pty Limited was a company in which the plaintiffs were directors and shareholders. At the time of the hearing the company was not trading and was deregistered. H J Bellamy & Sons (Builders) Pty Limited was a company in which the other defendant, Wayne Bellamy, appeared to have no interest. The company and Mr Wayne Bellamy were registered as tenants in common on the title to the property at 328 Soldiers Point Road, Salamander Bay. The proceedings were conducted on the basis that the parties were Mark Lachlan Plant and Dale John Plant, plaintiffs, and Wayne Anthony Bellamy, defendant.

3 The parties agreed that there were a number of different aspects to their arrangements, dealt with in the pleadings and evidence as:

The service agreement: under which the plaintiffs agreed to undertake concreting and other work for the defendant.

The trade account agreement: under which the defendant allowed the plaintiffs to purchase trade supplies on his trade accounts.

The loan agreement: under which the defendant lent money from time to time to the plaintiffs.

4 The defendant alleged that the parties also entered into a lease/buy agreement with respect to the industrial unit at 10/328 Soldiers Point Road, Salamander Bay. The plaintiffs agreed that there was an agreement for the sale of the unit to them but denied that any element of a lease was involved.

5 The largest part of the claim related to concreting work undertaken at 328 Soldiers Point Road, Salamander Bay. The development involved the construction of a number of factory units. It was carried out in two stages. Stage 1 was constructed between February 1998 and September 1998; Stage 2 between July 1999 and February 2000. The dispute related to work done in Stage 2. A smaller part of the claim was for concreting work done at various other sites.

6 Various claims and cross claims were made in the pleadings concerning the figures involved. At the conclusion of the hearing there was agreement concerning some of the amounts in issue. They were:

Payments made by the plaintiffs directly to the first defendant or to others on behalf of the defendant: $140,699

Amounts charged under the trade agreement to the defendant’s trade accounts by the plaintiffs: $84,847.10

An amount was owing to the plaintiffs under the service agreement. If the plaintiffs’ claims were accepted, a fair and reasonable sum, under the service agreement, for:

(a) work, partly on Stage 2 and partly on other sites, for which they were not paid was $103,956

(b) supervision was $14,000

(c) other work was $6,283.

No amounts remained owing to the defendant under the loan agreement or the trade account agreement.

7 The plaintiffs ultimately claimed that they were owed $115,690.90. The defendant conceded that he owed them $9,309. There was no dispute that the concreting work that was the subject of the claim was carried out for the defendant. The issues were:

1 Whether the plaintiffs’ version of the basis upon which they were to be paid under the service agreement was to be preferred to that of the defendant.

2 The rate at which the plaintiffs were to be paid for their work.

3 Whether an area of 115 square metres of the car park of the development was concreted during Stage 1 or Stage 2.

4 Whether the plaintiff, Mark Plant, was responsible for supervision of work undertaken by other trades on Stage 2.

5 The arrangement concerning the terms upon which the plaintiffs’ occupied unit 10.

ISSUE 1 - CREDIT

8 The plaintiff, Mark Plant, was presented in the course of cross examination with his criminal historyⁱ. Leaving aside the offences committed while a juvenile, the crimes included break, enter and steal; larceny; drug supply; possession of firearms; and various driving offences, some of which involved alcohol. He did not seek to deny this history.

9 Mark Plant was challenged on the way in which the plaintiffs’ claim developed from the amounts set out in correspondence between him and the defendant prior to the commencement of litigation and the amounts claimed in the proceedings. He said the earlier correspondence reflected his lack of sophistication in book keeping and the problems encountered through the failure of the parties to keep records of their transactions. He stated that he did not appreciate the true value of his claim until, in the absence of a satisfactory response from the defendant, he obtained professional advice prior to the commencement of the proceedings.

10 There was no evidence of any criminal history on the part of the defendant, but like Mark Plant, in the course of his evidence he acknowledged that he made a number of mistakes that affected the balance of accounts between him and the plaintiffs. The result in his case was that rather than increasing the amount claimed, those mistakes reduced the amount he claimed, through a cross claim, was owed to him by the plaintiffs.

11 There was, however, other evidence, dealt with later in these reasons that was not credible and in my view indicated that the defendant was not honest with the court.

12 It was readily apparent that the casual nature of the arrangements of the parties and their poor record keeping was responsible for the changes in their positions as to the amounts claimed to be owing.

13 The result was that, taking into account Mark Plant’s criminal history and the defendant’s dishonesty in some aspects, I had no reason to prefer the evidence of one party over that of the other. Each issue has therefore been dealt with individually and decided after consideration of the evidence related to that issue.

ISSUE 2 – The appropriate rate for the plaintiffs’ remuneration

14 The defendant stated that the service agreement was entered into with Mark Plant in 1998 prior to the commencement of Stage 1 of the development and that its terms were:

1 The defendant would pay Mr Plant $25 per hour for his own work and for that of any labourer supplied by Mr Plant to assist him.

2 The defendant would supply all materials.

3 The defendant would supply equipment necessary to carry out the work.

15 Mark Plant agreed that during Stage 1 the defendant supplied all materials and that he supplied some equipment, namely formwork and a trowelling machine. He consistently denied that he agreed to a rate of payment of $25 per hour. Mark Plant claimed that he charged and was paid $250 per day. He agreed that in 1998 $25 per hour could have been a reasonable rate for simple concreting jobs where materials and equipment were supplied. He said that Stage 1 work did not fall into this category. He said that from time to time he told the defendant the amount he claimed to be due and the defendant gave him a cheque for that sum.

16 The parties agreed that in Stage 1 and Stage 2 no time sheets were kept, no invoices were provided for any of the work performed by the plaintiffs, no receipts were issued and work diaries were used but not retained.

17 The defendant’s position was that work on Stage 2 was done on the basis of the agreement reached in 1998 after discussion with Mark Plant. This was inconsistent with his affidavit evidence in which he stated:

In fact when I asked him to do the work I had no conversation with him whatsoever about how payment was to be made as I regarded it as part of our ongoing arrangement at $25.00 per hour. ⁱⁱ

18 Asked why such an important discussion was overlooked, the defendant stated the affidavit was correct and that his discussion at the time of Stage 2 related to the amount to be paid for the plaintiffs’ work in the construction and erection of the walls of the units. He said he reached an agreement with Mark Plant that the walls would be constructed at the rate of $100 per square metre, inclusive of the materials that were to be supplied by the defendant.

19 The walls for the units in Stage 2 were constructed by way of a technique that, at the time, was new to the Port Stephens area. They were referred to in evidence as tilt slab walls. The technique involved pouring concrete to form up slabs on site that were then lifted by crane into position to form the walls of the units.

20 Mark Plant said that he had no discussion with the defendant about the rate at which he would be paid for work in Stage 2. He denied that any separate agreement was reached on a rate to be paid for the work on the tilt slab walls.

21 The parties agreed that at the time of the Stage 2 work they reached an agreement under which the plaintiffs or their company would purchase unit 10 within the development. Part of that agreement was that the value of work done by the plaintiffs would be set off against a deposit of $25,000.

22 In February 2004 Mark Plant made an attempt to reconcileⁱⁱⁱ the competing claims of the defendant and the plaintiffs. It was suggested to him that he excluded any claim for Stage 2 work because at that time he considered that the plaintiffs had been fully paid for that work. He said the reconciliation was prepared without professional assistance, in response to a document^iv sent to him by the defendant that, not surprisingly, he could not understand and at a time when he had no idea of the amount due for the Stage 2 work. He said it was prepared as a basis for negotiation before the work was measured in order to finalise the amount owing. At the time of preparation of the document he believed that the defendant intended to sell unit 10 the plaintiffs and that the value of work on Stage 2 would be set off against the purchase price.

23 The document that Mark Plant could not understand was, according to the defendant, just some scribbling that he put down on paper. He said he had never given a copy of the document to the plaintiffs. He could not explain how it came to be in their possession. The defendant was not able to explain its contents or how the figures set out in it fitted into the financial dealings between the parties.

24 The defendant agreed that the plaintiffs carried out work on three sites other than at 328 Soldiers Bay Road. The sites in question and the sums claimed to be owing to the plaintiffs in respect of their work were:

McDougall property - $10,098

Smith property - $750

Tradelink car park - $16,854

25 The sums specified were those agreed by the quantity surveying experts to be reasonable when assessed on a quantum meruit basis.

26 In respect of the McDougall and Smith jobs, the defendant maintained that the hourly rate of $25 applied.

27 The defendant claimed that the plaintiffs agreed to perform the work on the Tradelink car park for $10,800, being the amount quoted to him by Mr Maudson for the same job. Mark Plant denied ever having seen this quotation.

28 Mark Plant said the area of concrete laid extended beyond the area of the existing car park and that his claim included the costs incurred by him in securing the services of a plumber and earthworks contractor and the costs of materials and landscaping.

Issue 2 - Findings

29 I could find no evidence of any agreement between the parties concerning the amount to be paid to the plaintiffs for the Stage 2 work or the work on the other sites.

30 The defendant’s contention that agreement was reached on the rate to be paid for the Stage 2 work is rejected for the following reasons:

1 As with Stage 1, there was no written document evidencing the agreement that he relied upon. There were no invoices, receipts or details on cheque butts to support the claimed agreement.

2 There were substantial differences in the way in which the plaintiffs worked in Stage 2:

(a) Dale Plant joined his brother Mark in undertaking the work.

(b) The corporate structure was introduced by the plaintiffs.

(c) The plaintiffs used their own equipment, having purchased formwork and the trowelling machine from the defendant.

(d) The plaintiffs provided some of the materials, namely, concrete and fittings for Unit 10.

(e) Work on Stage 2 to a value of $25,000 was to be set off against the price to be paid for unit 10.

(3) I considered it improbable that Mark Plant would agree to a fixed rate for the tilt slab walls inclusive of the cost of materials when a new technique, of which neither party had experience, was involved in their construction and the precise cost was therefore unknown. Further, the cost of materials was unknown to the plaintiffs at the time of the alleged agreement. I reject the defendant’s contention that the plaintiff, being concretors, would have been able to calculate the cost of materials for this new technique.

(4) The defendant’s own document, albeit scribblings that somehow made their way into the plaintiffs’ possession, bore no relationship to the alleged agreement.

(5) The quotation for the Tradelink car park was dated two years earlier than when the plaintiffs carried out their work on the car park. It was very brief. It made no reference to the area involved, nor did it specify whether it was inclusive of the work of other contractors. I considered it improbable that Mark Plant would agree to meet a quotation in those terms.

31 I therefore find that the parties reached no agreement in which the rate of payment for the plaintiffs’ work was established.

32 In the absence of agreement, I find that the plaintiffs were entitled to a quantum meruit for the work performed on Stage 2 of the development and on the other sites.

33 The sum agreed by the quantity surveyors retained by the parties was $103,956.

34 I find for the plaintiffs in the sum of $103,956 on this issue.

ISSUE 3 – CAR PARK CONCRETING

35 The plaintiffs claimed for work involved in laying 115 square metres of concrete on the driveway to the development. The quantity surveyors agreed that the value of this work was $6,283.

36 The defendant initially stated that the concrete was in place before the construction of any part of the development was undertaken and that the plaintiffs did not lay it. Mark Plant was cross examined at length to this effect.

37 In the face of photographic evidence the defendant conceded that the plaintiffs laid the concrete but said that it was done as part of the Stage 1 works for which the plaintiffs were fully paid.

38 The plaintiffs agreed that the major part of the concrete driveway was poured during Stage 1. The area in contention, they claimed, was not poured at that time because it was necessary to leave it open so that services to be provided for both Stage 1 and Stage 2 could be laid within it.

39 Further, Mark Plant stated that a shipping container hired by the plaintiffs for the purpose of Stage 2 was placed on part of the area immediately adjacent to the area where unit 10 was built. It was after the container was removed that there was discussion about concreting the area on which the shipping container was located to provide extra parking and this was done as part of the 115 square metres claimed. Again, the defendant denied this and claimed that the work was performed in the course of Stage 1.

40 Dale Plant was not cross examined on this aspect of his affidavit evidence. He agreed that he read Mark Plant’s affidavits and agreed with the material set out in them. Asked if he agreed because the affidavits looked about right^v, he responded: Because I actually participated in that work^vi and it looked about right. He was not specifically asked whether the work was done in Stage 1 or Stage 2.

Issue 3 - Findings

41 I have concluded that the defendant was mistaken on this aspect of the construction of the driveway for the following reasons:

1 It was logical to leave open the area through which services for both stages were to be located until Stage 2 was completed.

2 There was no logic in constructing concrete in an area immediately adjacent to unit 10 before the unit itself was constructed.

3 There was no specific cross examination of Dale Plant on this aspect of his evidence.

42 I find the 115 square metres of concrete were laid as part of the Stage 2 works. I find for the plaintiffs in the sum of $6,283 on this issue.

ISSUE 4 – SUPERVISION

43 The plaintiffs claimed $14,000 for supervision of the Stage 2 work. Their claim was for 20 hours per week for 20 weeks. They stated that, after Stage 1 was completed, the defendant moved to Queensland and during Stage 2 visited the site intermittently only. As a result it fell to Mark Plant to open and close the site each day and to contact, coordinate and supervise the work of other tradespersons, taking instructions on what was to be done by telephone from the defendant when necessary.

44 In addition, the Mark Plant said they cleaned the site daily, organised the delivery of materials to site or collected them from suppliers and dealt with engineers and local council officers. Mr Plant said he used engineering drawings for the purpose of instructing other tradespersons and organised them to maintain the construction program for Stage 2. He picked up and returned the defendant to the airport and telephoned him to report on progress.

45 It was claimed that the plaintiffs hired a container for the storage of their tools and materials on site and made it available to others working on the site for storage. When the work reached lock up stage Mark Plant held the keys to the individual units and opened them daily to allow access for other trades.

46 Mr McColm provided affidavit evidence^vii, on which he was not cross examined, that between July 1999 and February 2000 he drove a vehicle in which he delivered sand and fill to the site or removed materials from the site. He stated that Mark Plant telephoned to place orders, met him on site, directed him to the point at which to place or remove materials and supervised his activities while on site. The defendant’s only response to this evidence was to state that he did not place orders with the drivers who delivered supplies.

47 Mr Harle was retained to provide engineering services during the second half of 1999 in relation to the tilt slab walls. He provided affidavit evidence^viii upon which he was not cross examined, stating that his files contained eight diary notes recording design work in progress during Stage 2. Seven of those notes referred to the name Plant and one to the names Plant/Bellamy. There were file notes of two telephone conversations with Mark Plant. He undertook a site inspection on 15 September 1999 at which Mark Plant met him and coordinated his activities. There was no record on his file to indicate that he dealt personally with the defendant in connection with the services he provided for Stage 2. The defendant’s only response was to state that he went to Mr Harle’s office on one occasion and that he paid his bill.

48 The defendant agreed that he lived in Queensland at the relevant time, producing bank documents indicating that he moved there in July 1998 while the Stage 1 works were in progress. He denied that he asked Mark Plant to carry out any supervision and that Mark Plant in fact performed the role of supervisor. He stated that the plaintiffs did no more than their own work on Stage 2. He said he coordinated or supervised work either by attending on site or by telephone. He claimed that he attended the site weekly and that he was on site for 90% of the time. Once more no timesheets or diaries were available to corroborate the evidence of either party.

49 Mark Plant rejected the proposition that the defendant visited the site weekly. The defendant produced credit cards statements^ix recording the purchase of airline tickets and purchases made in the Port Stephens area at various dates. These documents indicated that airline tickets were purchased at monthly, rather than weekly, intervals. The defendant claimed that when he flew down, he stayed for longer than one day and pointed to one credit card statement that indicated that he was in the Port Stephens area for one week. Another, however, indicated that he was in Queensland for all but one day in August 1999.

50 The defendant agreed that the tradespersons who worked on site in Stage 2 were known to him and continued to be known to him at the time of the hearing. None of them was called to give evidence.

Issue 4 – Findings

51 The unchallenged evidence of Mr McColm and Mr Harle was that they did not see the defendant on site. This evidence was of particular significance in relation to the engineer who was responsible for the tilt slab wall structures.

52 No tradespersons known to the defendant were called to provide evidence to support his claim to have been on the site for 90% of the time nor did the credit card evidence support the defendant’s claim to have been on site weekly during Stage 2.

53 It was apparent from the nature of their dealings that until the breakdown in their relationship in 2003, the defendant placed a substantial element of trust and reliance on Mark Plant.

54 Taking these matters into account, I accept the evidence of Mark Plant that a significant part of his time during the Stage 2 work was expended in the supervision and coordination of site work generally.

55 The quantity surveyors assessed the value of this work at $14,000.

56 I find for the plaintiffs in the sum of $14,000 on this issue.

ISSUE 5 – THE ARRANGEMENT CONCERNING UNIT 10

57 It was agreed that:

1 The defendant offered to sell unit 10, whether to the plaintiffs, their company or to Mark Plant only was unclear.

2 The price for unit 10 was $105,000 of which $25,000 was to be paid as a deposit and the balance of $80,000 was payable over 10 years with interest at 8.75%.

3 The plaintiffs could set off the value of work performed for the defendant against the deposit.

4 The plaintiffs took possession of unit 10 in April 2000 and remained in occupation until April 2005. They performed work to complete it, including laying the concrete floor and arranging for tradespersons to install plumbing and electrical services.

58 The defendant claimed that the arrangement concerning unit 10 required the plaintiffs to pay rent in the sum of $200 per week and that no rent was ever paid.

59 The defendant’s claim was based upon another incomprehensible document^x dated 4 April 2000. There was no doubt that it was unenforceable as a contract for the sale of the unit. It was not signed by any party. It named as Leasors persons who were not the registered proprietors of the property.

60 Notwithstanding these deficiencies, there were some indicia of a lease arrangement. The document was entitled LEASE/BUY AGREEMENT. It referred to a rent/purchase amount of $300 per week and it named Wayne Bellamy and Sharon Crichton as Leasors (sic).

61 The defendant claimed that, of the $300 specified as the rent/purchase amount, $200 was to be applied to rent and $100 to repayment of the loan. Acknowledging that the document made no reference to payment of rent of $200 per week, the defendant said that this was a gross mistake on his behalf.

62 The defendant agreed that it would have been advisable to specify in his agreement with precision the amount to be paid for rent and the amount to be paid on account of the purchase price. He acknowledged that the document was precise with other figures, including the interest component.

63 It was put to the defendant that he arrived at a figure of $300 per week by a process of calculating interest at 8.75% flat on $80,000 over 10 years, arriving at a sum of $70,000. The interest and the balance of the purchase price equalled $150,000 which, divided by 10 years, resulted in $15,000 per annum or $300 per week. The defendant denied that this was the process by which he arrived at the figures contained in the document.

64 The defendant said he selected the 10 year period for repayment of the loan to allow for delays in the registration of the strata plan. This was clearly not the true reason. A 10 year delay would be extraordinary and, in any event, contrary to his experience with other developments. Further, in ordinary transactions involving the sale of property, the 10 year period for the repayment of the loan would not commence until the vendor was able to give title after registration of the plan.

65 The defendant initially denied but subsequently accepted that, on his position, payment of only $100 per week towards the purchase price would not pay out the loan by the end of 10 years. His answers when pressed about the position that the plaintiffs would be in at the end of the 10 year period on his hypothesis became increasingly incomprehensible.

66 On 23 March 2003, when the registration of the strata plan was underway, the defendant wrote^xi to Mark Plant offering the unit for sale for $140,000. He said he made this offer because, notwithstanding his frequent verbal requests, no rent had been paid and he considered that the lease/buy agreement was at an end. There was no written record that he made any demand for rent.

67 In this letter, the defendant referred to a monthly rent payment of $1,200 per month, or $300 per week. This, he said, was another mistake on his part.

68 The defendant agreed that by 2005 he wanted to recover possession of unit 10 from the plaintiffs. He did not do this by the court process but said he asked the plaintiffs many times to leave.

69 Mark Plant’s evidence was that he vacated unit 10 in April 2005 after he was contacted on two occasions by members of motorcycle clubs. The first visitor he identified as Danny, a Commanchero; the second was Dennis Harris, a Bandido.

70 Danny left threatening telephone messages on Mark Plant’s mobile telephone. Mark Plant reported this to Detective Senior Constable Rhodes who listened to the messages and telephoned Danny. As a result of his conversation with Danny, Detective Rhodes telephoned the defendant’s solicitor. The defendant denied any knowledge of Danny or his activities. He could not explain why Detective Rhodes rang his solicitor about Danny and he was not concerned by it. He was not concerned by the suggestion that the plaintiffs had been threatened because it had nothing to do with him.

71 Mark Plant said that Mr Harris arrived at the unit in a car with four other males. Mr Harris and his companions were wearing black jackets bearing the word Bandidos in white lettering. The letter Mr Harris delivered was a notice to quit^xii unit 10 within seven days, failing which the owners or their appointed agent Mr Harris would institute proceedings.

72 The defendant agreed that he gave Dennis Harris a letter to deliver to Mark Plant. He said he did so because Mr Harris was buying the unit and therefore the plaintiffs needed to vacate it.

73 The defendant’s evidence in relation to Mr Harris was marked by a series of inconsistencies. He denied that Mr Harris was his agent and was unable to explain why he was so described in the notice to quit. He subsequently agreed that he gave instructions to his solicitor as a consequence of which Mr Harris was appointed agent to obtain vacant possession of unit 10. He denied that his solicitor told him that Detective Rhodes again telephoned him about very real threats made by Harris^xiii. He subsequently remembered that his solicitor told him of this and that he was surprised by this information.

74 He denied that he ever met Mr Harris. He said Mr Harris rang him in response to an advertisement in the Newcastle Herald. He did not retain a copy of the advertisement or the invoice for the cost of the advertisement. He subsequently said that he showed Mr Harris around unit 10, although not through it because it was occupied. He then denied that he took Mr Harris around unit 10. Instead he said he told him where it was and Mr Harris went to look at it.

75 Although Mr Harris was described in the notice to quit as the purchaser, according to the defendant, the contract for sale was never exchanged. A copy of the contract was on the file^xiv of the defendant’s solicitor. There were aspects of the contract that were unusual. Attached to the contract was a lease stated to commence in January 2005 when unit 10 was obviously not tenanted because it was occupied by the plaintiffs. The contract provided for the payment of a deposit of $100 only. Asked why he agreed to accept this token deposit when he was dealing with a purchaser whom he had never met and knew nothing of, the defendant initially denied that he authorised it. He subsequently agreed that he instructed his solicitor to write to Mr Harris’ solicitor accepting a deposit of $100.

76 The defendant agreed that his solicitor’s file note^xv was correct in recording that he told him that the purchaser had a clear understanding of the position with Plant. No problem with the issue of possession/completion. He denied that he was confident of this was because he expected Mr Harris, his agent, to take care of the issue of possession.

Issue 5 - Findings

77 It was on this aspect of the proceedings that the defendant’s evidence reached the pinnacle of incredulity.

78 I find that there was an agreement for the sale of unit 10 to the plaintiffs. The agreement was informal and was made between Mark Plant and the defendant. The defendant’s document provided some evidence of the terms of the agreement but was unenforceable as a contract for sale.

79 I find that there was no agreement between Mark Plant and the defendant for the payment of rent or any other form of occupation fee. The figures provided by the defendant were calculated on the basis that the loan of the balance of the purchase moneys would be repaid, with interest, at the rate of $300 per week over a period of 10 years.

80 The defendant decided not to proceed with the sale after the relationship between him and the plaintiffs broke down and it was apparent that unit 10 was of greater value than the price agreed with Mark Plant.

81 I reject the defendant’s denials of any connection between him and Danny. That Danny was able to refer Detective Rhodes to the defendant’s solicitor was evidence of that connection.

82 I reject the defendant’s denials of any connection between him and the threats made by Dennis Harris. I find that the alleged contract for sale to Mr Harris was contrived to import an element of legitimacy into the service of the notice to quit by Mr Harris.

83 I find that the letter of March 2003 offering the sale of unit 10 at a higher price and the use of tactics of intimidation in securing possession were clear acts of repudiation of the agreement.

ISSUE 6 – THE RENT CLAIM BASED ON IMPLICATION

84 Notwithstanding the manner in which possession was recovered, there remained the question of whether there should be implied into the nature of the dealings between the parties an obligation on the part of the plaintiffs, having had the benefit of occupation of unit 10 for five years, to pay some form of rent or occupation fee to the defendant.

85 In support of the defendant’s claim I was provided with an extract from a text^xvi that dealt with Automatic implication of terms in certain well recognised contracts. One example given in the text was a contract creating the relationship of landlord and tenant in which it was said that the basic obligation of the tenant was to pay rent and that a court will, as far as possible, give effect to the arrangement between the landlord and the tenant.

86 This was a proposition that, as with the concept of quantum meruit, entitling a party to a fair price for work done, on its face had some merit.

87 However, in this case, there was no lease agreement between the parties. Such agreement as there was related to the sale to the plaintiffs of unit 10. At best, it could be said that the plaintiffs were permitted to occupy unit 10 as purchasers prior to completion of the sale and that they were therefore licensees. The terms on which they were allowed into possession did not require the payment of a license fee.

88 The sale of unit 10 to the plaintiffs did not proceed because the defendant repudiated their informal agreement. In so doing he was in breach of a condition that the authors of another text^xvii suggested was implied into every contract, namely a duty of cooperation. The authors quoted the Butt formula as follows:

It is a general rule applicable to every contract that each party agrees, by implication, to do all such things as are necessary on his part to enable the other party to have the benefit of the contract. ^xviii

89 If the defendant had performed his part of the informal bargain, the plaintiffs would have received the benefit of a capital gain on unit 10. It was apparent that the defendant, by March 2003, thought unit 10 was worth $140,000 to $150,000, a $35,000 gain on the price agreed three years earlier. A file note^xix of 21 April 2005 suggested that a purchaser for unit 10 was available at a price of $180,000.

Issue 6 - Findings

90 I find that having deprived the plaintiffs of the benefit of their informal arrangement and having retained that benefit for himself, it was not reasonable to imply into the arrangement a term requiring the plaintiffs to pay rent or other form of occupation fee in respect of the period during which they occupied unit 10.

91 The defendant’s claim for unpaid rent is rejected.

SUMMARY AND ORDERS

92 The result of my findings is a balance in favour of the plaintiffs in the sum of $124,239. After adjustment for the amounts paid by the plaintiffs to the defendant and the amounts for which the defendant is entitled to credit, including the sum of $3,600 that the plaintiffs conceded they mistakenly believed to have been paid for work that they carried out for the defendant in Queensland, the sum due to the plaintiffs is $112,090.90.

93 The plaintiffs are entitled to interest on their verdict. The parties are directed to agree upon the calculation of amount of interest to be paid.

94 My orders are:

1 Verdict and judgment for the plaintiffs in the sum of $112,090.90.

2 Verdict for the plaintiffs/cross defendants on the cross claim.

3 The proceedings are listed at 9.30 on 17 June 2009 to deal with issues of interest and costs and the return of exhibits.

4 My reasons are published.

_______________________________________________________

i.

Exhibit 1

ii.

Defendant’s affidavit 28.3.08, pp 20

iii.

Exhibit A(1).89

iv.

Exhibit A(1).88

v.

Transcript D2.70.43

vi.

Transcript D2.70.44

vii.

Exhibit A(1).209

viii.

Exhibit A(1).212

ix.

Exhibit A(1).248-268

x.

Exhibit A(1).74

xi.

Exhibit A(1).86

xii.

Exhibit A(1).110

xiii.

Exhibit C

xiv.

Exhibit 7

xv.

Exhibit E

xvi.

D W Greig and J L R Davis, The Law of Contract (1987) 539

xvii.

N C Seddon and M P Ellinghaus, Cheshire & Fifoot’s Law of Contract (8^th Australian ed, 2002) 414-415

xviii. Butt v McDonald

(1986) 7 QLJ 68, 70-71 (Griffith CJ)

xix.

Exhibit F

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