Sange Holdings Pty Ltd v J.D. & J.C. Scott Nominees Pty Ltd trading as J.C. Scott Constructions

[1991] FCA 136

'JUDGMENT No. !3G/ y!.. .... l

I ;

IN THE F E D E m COURT OF AUSTRALIA	)	No. QG 141 of 1990
QUEENSTAND DISTRICT REGISTRY	1	I
GENERAL DIVISION	)

BETWEEN :  SANGE HOLDINGS PTY. LTD.

Applicant

AND :  J.D. & J.C. SCOTT NOMINEES PTY. LTD.
tradina as J.C. SCOTT CONSTRUCTIONS

First Respondent

AND :  J.C. SCOTT DEVELOPMENTS PTY. LTD.

Second Respondent

MINUTES OF ORDER

JUDGE W I N G ORDER:	PINCUS J.
DATE OF ORDER:	10 APRIL 1991
WHERE MADE:	BRISBANE

l I

THE COURT ORDERS THAT:  '

1.    The first respondent pay the applicant the sum of

$1,053,482.

2.   The first respondent pay the applicant's costs of and incidental to the proceedings, to be taxed.

3.    The proceedings otherwise be adjourned to a date to be fixed.

NOTE:	Settlement and entry of
Order 36 of the Federal Court Rules.

11 APR 1991

FEDERAL COURT OF

AUSTRAUA

PRINCIPAL

REQISTUV ,

IN THE FEDERAL COURT OF AUSTRALIA	1	No. QG 141 of 1990
QUEENSLAND DISTRICT REGISTRY	1	I
GENERAL DIVISION	1

BETWEEN: SANGE HOLDINGS PTY. LTD.

Applicant

AND; J.D. & J.C. SCOTT NOMINEES PTY. LTD.

tradina as J.C. SCOTT CONSTRUCTIONS

First Respondent

AND: J.C. SCOTT DEVELOPMENTS PTY. LTD.

Second Respondent

GORAM: PINCUS J.
PLACE: BRISBANE

DATE: 10 APRIL 1991

REASONS FOR JUDGMENT

This is an application made under 9.52 of the Trade Practices Act 1974 and also under the general law and under a statute of the State of Queensland, namely the Subcontractors' Charaes Act 1974-1976. It relates to the price of formwork done by the applicant under contract with the first

with the second respondent. The formwork was necessary for	respondent, which was itself doing its work under contract	the construction of a large building in this city. Neither respondent was represented at the 'trial, so that the question becomes whether, on the uncontradicted evidence produced on behalf of the applicant, it is entitled to judgment.
The statement of claim alleges that the first respondent represented to the applicant that the formwork required for the project in question, a bloik of home units, was 21,666 square metres in area. It also alleges that the first respondent said it would pay the value of formwork installed in excess of 21,666 square metres. These representations were said to be false, in that the area was 38,157 square metres and that the first respondent did not, at the relevant time, intend to pay extra for extra formwork. As to the latter point, I note the provisions of s.51A of the Trade Practices Act.
The statement of claim says that the first respondent was guilty of deceptive and misleading conduct and that, induced by such conduct, the applicant agreed to do the formwork for the project for $650,000.
The second complaint made in the statement of claim is that, in various ways set out in the pleading, the first respondent delayed the works in breach of an implied term of the agreement, causing the applicant to incur additional expenditure.
Next the statement of claim sets up a cause of action under the Subcontractors' Charges Act, the details of which are explained below.
The evidence as to the misrepresentation is that certain plans were provided to the applicant, on the basis of which one Isakka, on its behalf, calculated the area of the
fonnwork to be 22,000 square metres. Subsequently, the first respondent told Isakka that the quantity surveyor had measured 21,666 square metres, but Isakka adjusted that to 21,800 square metres. The evidence is not precisely in accord with what is pleaded, but it does not appear to me that the difference is of any great significance. I find that the area of formwork required was 38,157 square metres as alleged. However, the applicant did not complete all that work and I find that 2,175 square metres was left undone. That is, the work actually done was 35,982 square metres, an excess of 14,316 square metres over the amount represented. The excess was apparently due to the work's being of a substantially different character from that represented.
The applicant's evidence gives some support to the view that the excess should be paid for at a higher rate than the original quote. However, having studied Mr. J.A. Steele's affidavit, I am not satisfied that the applicant is entitled to any more than the $30 per square metre on which the job was
quoted. That is, I think the proper price for the whole job to be $1,079,460, rather than sum of $1,160,661.55 mentioned
in Mr. Steele's affidavit. That leaves a balance of $713,243 still to be paid, $366,216 having been paid already.
The next item claimed is for what is described as the prolongation cost; the evidence on this subject is not entirely convincing. It is, as it seems to me, somewhat doubtful whether the considerable collection of complaints

recorded in the diary which has been put in evidence can be accurately costed. Nor is it absolutely clear that all of these complaints can be connected to matters which are pleaded. On the whole, however, I can see no justification, in the absence of evidence to the contrary, for rejecting the applicant's case under this heading. Mr. Steele has valued the costs incurred at $340,239 and that must be allowed.

Paragraph 60 of Mr. Isakka's affidavit says that, as a result of the extra work required, extra supervision was necessary. In my opinion, this is not a proper additional head of claim. The figure of $30 per square metre is intended to cover all costs including supervision. The result is that the applicant is entitled to $1,053,482 against the first respondent. I do not propose to allow any interest.

There remains for consideration the claim against
the second respondent under a Queensland statute, the

Subcontractors' Charaes Act 1974-1976. The evidence on this

present purposes to explain the scheme of that legislation in subject appears to me to be deficient. It is unnecessary for	detail. The basis of the claim is that, by giving appropriate
notices, the applicant in this case could charge monies due by the second respondent to the first respondent. Notices have been given, but an initial question is whether s.12(1) of the Act is brought into operation. It says:

"Where the person to whom notice of claim of charge has been given does not pay or make satisfactory arrangements for paying to the claimant the amount claimed, the subcontractor may recover the amount of the charge from the person by whom the money subject to the charge is payable".

To establish this liability, a notice must "catch" money due by (in this case) the second respondent to the first respondent.

The documents in Exhibit 4 are copies of what I am prepared to assume are authorities for payment of monies under the head contract. The notices of intention to claim charge relate to amounts totalling $1,153,148. That is a greater sum than I am prepared to allow ($1,053,482), but is substantially less than the total price; $366,216 was paid by the first respondent. It is unclear what work the sums the subject of the notices of the claim under the Subcontractors' Charqes Act related to. They amount to less than the price asserted in the statement of claim to be properly due (see paragraph 26) and presumably the difference is, at least in part, to be attributed to the fact that some payments were made. But

there is no means of reconciling the figures placed before me.

It is necessary to show that work was done by the applicant to

the value of each notice, as at the date on which it was given (see s.10) and that it caught sunis due then or later by the second respondent to the first respondent. The second point should not be difficult, but the first would require some analysis of the figures, which is presently absent. I have no means of knowing what the work was to which each nAtice related, nor to what extent it was paid out.

It appears to me that the proper course is to give judgment against the first respondent in the sum mentioned above, $1,053,482, with costs, but otherwise to adjourn the proceedings to a date to be fixed.

I certify that this and the

five preceding pages are a true copy o f the reasons for judgment herein of his Honour Mr. Justice Pincus.

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Associate

Date 1 0 April lqql