Smith and Smith v August and August
[1995] QCA 380
•25/08/1995
| IN THE COURT OF APPEAL | [1995] QCA 380 |
| SUPREME COURT OF QUEENSLAND |
Appeal No. 13 of 1995.
Brisbane
[Smith v. August]
BETWEEN:
JACQUELYN JUNE SMITH and
WARREN JOHN SMITH
(Defendants) Appellants
AND:
ROBERT ERIN AUGUST and
MARGARET AUGUST
(Plaintiffs) Respondents
___________________________________________________________________
Fitzgerald P.
Pincus J.A.Shepherdson J.
___________________________________________________________________
Judgment delivered 25/08/1995
Judgment of the Court
___________________________________________________________________
APPEAL ALLOWED. THE DAMAGES ARE TO BE REDUCED BY $1,940 TO $13,096.65 AND THE INTEREST WILL BECOME $5,762.53 SO THAT THE TOTAL OF THE VARIED JUDGMENT IS $18,859.18. THE MATTER IS ADJOURNED TO A DATE TO BE FIXED TO ALLOW THE PARTIES TO MAKE FURTHER SUBMISSIONS IN WRITING WITH RESPECT TO COSTS HERE AND BELOW; SUCH SUBMISSIONS ARE TO BE MADE WITHIN SEVEN (7) DAYS.
___________________________________________________________________
CATCHWORDS: DAMAGES - vehicle stolen from appellants’ workshop while in for repair - whether quantum overestimated - whether reasonable to expect bailee to assume that certain valuable items had been left in the vehicle - allowance for respondents’ labour in repairing damage - depreciation of vehicle - loss of use of vehicle - interest.
Burns v. M.A.N. Automotive (Aust) Pty Ltd (1986) 161 C.L.R.
Hadley v. Baxendale (1854) 9 Exch. 341.
PROCEDURE - whether action could have been brought in
Magistrates Court - relevance to costs - discretion.
| Counsel: | Mr A Collins for the appellants. Mr K R Geraghty for the respondents. |
| Solicitors: | Gadens Ridgeway for the appellants. Watling Roche and Associates for the respondents. |
Hearing date:23 May 1995.
IN THE COURT OF APPEAL
SUPREME COURT OF QUEENSLAND
Appeal No. 13 of 1995.
Brisbane
| Before | Fitzgerald P. Pincus J.A. Shepherdson J. |
[Smith v. August]
BETWEEN:
JACQUELYN JUNE SMITH and
WARREN JOHN SMITH
(Defendants) Appellants
AND:
ROBERT ERIN AUGUST and
MARGARET AUGUST
(Plaintiffs) Respondents
REASONS FOR JUDGMENT - THE COURT
Judgment delivered 25/08/1995
This is an appeal from a judgment of the District Court in an action brought to
recover damages for loss suffered when the respondents' vehicle was stolen in February
1989. The respondent plaintiffs' case below was that they brought their Range Rover
vehicle, loaded with chattels, to the appellants' premises to have work done on the vehicle;
that the appellants were told that there was "valuable gear" amongst the load; that they
were given an assurance that the vehicle would be kept in the appellants' workshop which
was "safe"; that at the time when it was stolen the vehicle was not stored in the workshop
but in an unsafe place; that in consequence the vehicle was stolen and thereby the
respondents suffered loss, in that the vehicle was damaged and items were stolen from it. These allegations, some of which were contested, were accepted by the primary judge who
assessed damages in the sum of $21,652.77 (including interest) with costs. The appeal
does not challenge the judge's finding that the appellants are liable for the respondents'
losses; it is argued that the judge over-estimated the quantum of those losses, and his
Honour's order for costs is also challenged. Items of loss which were, in the appellants'
outline of argument, said to have been wrongly allowed by way of damages against them
were not all pressed in oral argument; some were either expressly or implicitly abandoned.
Mill
The appellants submitted that the judge erroneously took into account in favour of
the respondents the evidence of one Mill. The evidence was that in preparation for a
proposed long journey the respondents took their vehicle to the appellants to have
mechanical work done on it, in December 1988. The work being supposedly completed,
they set out on their trip, but encountered mechanical problems and decided to take the
vehicle back to the appellants for further examination; that was done on 25 January 1989.
It was on that second visit to the appellants' premises, in January 1989, that the loss was
sustained in the way which has been described - i.e. the vehicle was not kept in the
workshop as promised, but left elsewhere, and so was stolen. The judge found that Mill
was with the respondents at the appellants' premises on the second occasion in January
1989. After discussing the credibility of the respondent R A August, his Honour remarked:
" In the end I felt satisfied that he was generally a credible witness and I could detect on his part no attempt to mislead the court. Whatever reservations I might have had about the reliability of all that he said were displaced by the evidence of Mr Mill who I found to be a quite convincing witness." .
His Honour went on to say in effect that it was in January and not in December that Mill was
present at the appellants' premises.
The importance of Mill's evidence, then, seems to go well beyond that of a challenge
to quantum. Although the notice of appeal does not assert that the judge should not have
found against the appellants on the question of liability, if it was not reasonably open to the
judge to find that Mill supported the respondents' version of events and in particular that of
R A August, then, presumably there would have to be a new trial; this Court could hardly
re-try the credibility questions itself.
The basis of the attack on the judge's use of Mill's evidence was to the effect that
there was such confusion as to the date of Mill's visit to the appellants' premises that his
Honour should not have found that he was there at the critical time, in January 1989. Mill
said, consistently with the evidence of R A August, that when he went to the appellants'
premises he raised concerns about the equipment in the respondents' vehicle and in
particular about the fact that "there were some valuables, there were cameras and things
like that...". Mill said that the owner gave an assurance that the vehicle would be "left inside
and locked". Evidence was called, on the other hand, on behalf of the appellants, to the
effect that in January the vehicle was not fully loaded (as the respondents said it was), and
that nothing was said about valuables such as cameras in the vehicle.
Reading Mill's evidence, one would have difficulty being confident that it was in
January 1989 (the occasion when the vehicle was stolen) rather than in December 1988
when he came to the appellants' premises. In cross-examination he said his visit was
"before Christmas", but in re-examination he said, inconsistently with that statement, that
"a few days, a week maybe" after his visit he heard that the vehicle was stolen. He had the impression that when he came to the premises the vehicle was on a hoist and it seems
unlikely, although not impossible, that it was on a hoist during the respondents' visit to the
appellants' premises in January 1989. Further, the evidence of M August was, at best for
the respondents, equivocal as to the date of Mill's presence at the appellants' premises.
Despite these difficulties with Mill's evidence, it is impossible to hold that the
primary judge was necessarily wrong in relying upon it. R A August gave clear evidence
that Mill came to the premises in January 1989. The primary judge, who referred in his
reasons to the difficulty about the evidence concerning the time of Mill's visit, relied in
particular upon Mill's statement that it was shortly before he heard the vehicle was stolen;
perhaps his Honour thought that Mill was more likely to place the visit accurately in relation
to the time of the theft than by reference to dates. So the attack on the treatment of Mill's
evidence, although not without substance, must fail, because there was evidence to support
the judge's conclusions, because his Honour did not overlook the contrary evidence, and
because the final conclusion depended in substantial part upon his Honour's impressions
of the witnesses.
Jewellery and Camera Equipment
The judge found, in effect, that chattels to the value of $7,585 had been lost by the
respondents as a result of the theft, and the appellants contended in their outline that this
sum should be reduced to $1,535, adding "at least jewellery should be disallowed
($1,640.00)". The respondents' case was that among the items stolen were two diamond
rings and a new wrist watch, the rings being valued at $1,640 in total. It is convenient to
consider the rings first. The appellants' argument was based on the view that the judge should have found that the appellants would have had no reason to expect that diamond
rings would be left in the vehicle. They were small valuable items, and therefore tempting
for a thief; further, it would have been very simple for M August, who owned the rings, to
take them away with her when the vehicle was left at the appellants' premises in January
1989. But the appellants' argument was not that the respondents should have failed as to
the rings because their loss was the fault of M August; the argument depended entirely on
the proposition that the respondents could not reasonably have been expected to assume
that articles of that kind would have been left in a vehicle, presented for inspection and
repair.
In support of this contention, reference was made to authority concerning the rights
of recovery of a bailor, under the general law of bailment. But this issue does not depend
upon that law, because here, as judge pointed out -
" ...the plaintiffs' case was fundamentally that it was expressly agreed between the parties that, as a part of the overall contract whereby the defendant agreed to do work on the Range Rover for reward, the defendant accepted the obligation to keep the vehicle and its contents in a safe and secure situation (in particular in the workshop). ".
The case as stated was accepted by the judge.
One way of putting the question is to be found in Burns v. M.A.N. Automotive (Aust)
Pty Ltd (1986) 161 C.L.R. 653 at 657 and in other cases, namely to ask whether the loss
of such items was "within the reasonable contemplation of the parties" - a formulation which
is in essence derived from Hadley v. Baxendale (1854) 9 Exch. 341. No doubt it was within
the parties' contemplation, on the judge's findings, that if the vehicle was not kept secure
as promised, the respondents would be likely to lose chattels which were of some substantial value. Should it be held that such a contemplated loss would include small
items of jewellery? The question is not capable of a general answer. But where the
jewellery consists in rings of significant value which one would expect either to be worn, or
put away in some carefully chosen repository, the answer must be against the claimant;
particularly is this so when the appellants were given to understand that the contents of the
vehicle which were being left with the appellants consisted in chattels for use on a camping
trip.
The watch is in a different category, being a cheap item; so that the result is a
reduction in the amount to be allowed for loss of the chattels in the sum of $1,640, the value
of the diamond rings owned by M August, plus interest.
The other complaint which was pressed, in the same category, was the allowance
of the value of lost cameras and associated equipment, lenses and so forth. The total value
was $2,245. This is a substantial sum, but there is no reason to doubt the correctness of
the primary judge's view that the loss is allowable. The appellants did not, before us,
appear to dispute that it was open to his Honour to act on the view that the respondents
were specifically warned about the presence of camera equipment; the argument
amounted to an assertion that one would hardly expect such a substantial amount of
camera equipment to be in the vehicle. In our view the argument must fail, as the nature
and value of the equipment were not beyond the bounds of reasonable expectation.
Labour of R A August
The judge allowed a sum of $2,135.25, included in Exhibit 10, consisting in the
respondents' expenditure on what the judge described as "getting the vehicle back on the
road". Only that part of this item which related to the labour of R A August was challenged,
on the basis that a party's own work cannot be the basis of a claim unless it is shown that
it has caused the party financial loss. It was pointed out that the respondent R A August
was at relevant times said to be an invalid pensioner, so that he presumably had no regular
employment. The difficulty the argument faces is principally that R A August was,
according to the evidence, a qualified mechanic. Whatever the position may be if the party
doing the work is merely an amateur, there is no reason in principle why a person
possessing skills should not be allowed to use those skills in repairing damage done to his
chattels and to include the value of the work done in a claim of the present kind. This attack
on the judgment must fail.
Depreciation of Vehicle
The judge allowed $2,500, being the difference between the value of the vehicle
before its loss and the amount for which it was sold. The only point taken, in the end,
appeared to be that no allowance was made for the depreciation which the vehicle would
have suffered, stolen or not stolen, in those months. The judge makes no reference to that
question and may perhaps have treated the sum involved as too small to warrant separate
attention.
The vehicle was described as an "old Range Rover" being apparently 15 years old;
new models of such a vehicle are very expensive. It may be unsafe to assume that
vehicles which have fallen to say one-tenth of their current new value depreciate at any
significant rate; the matter was not touched in the evidence. In the circumstances the
judge's allowance should not be disturbed.
Travel to New South Wales
The judge allowed $600 as being "the loss which the plaintiff suffered as a result of
having to go to New South Wales to recover the vehicle "both estimated and actual...".
There was evidence with respect to $300 of this sum, being a debt due to one
Johnstone, but no evidence can be found to support the rest of it; it seems to have been
overlooked at the trial, and the respondents' damages must be reduced by a further $300
plus interest.
Loss of Use of Vehicle
The judge allowed $235 for loss of use of the respondents' vehicle during the time
when it was unavailable as a result of the appellants' breach of contract. That was
assessed on the basis of 11% interest for 12 weeks on the vehicle's value.
The principal criticism made of this allowance was that it overlaps with the
depreciation allowed on the vehicle and that the respondents should not have been allowed
both. It is true that depreciation is commonly - but was not here - calculated on the basis
of a percentage of value and that the loss of use of the respondents' vehicle was calculated
on that basis. It may be that for this reason, at least in some cases, there would be an
overlap between an allowance for depreciation of a damaged vehicle, during the period
in which it is unusable, and an allowance for loss of use of the vehicle. But here the
"depreciation" was a reflection of the difference between the quality of the vehicle before
the breach of contract and its quality when repaired, so far as it could reasonably be, after being damaged by thieves; there is not necessarily any component, in the depreciation
allowance, for mere lapse of time. The argument in respect of the $235 therefore fails.
Interest
The judge allowed interest at 11% for four years and it was said that his Honour
should not have done so without giving an opportunity to the respondents to produce
evidence of interest rates. Whether or not that point would otherwise have any merit, it has
none here, because counsel for the appellants explained to us what evidence would have
been called on the proper interest rate; if called and accepted, it would have supported a
rate close enough to that which the judge fixed, so that this point too must fail.
Costs allowed on the District Court Scale
The point was that the action could have been brought in the Magistrates Court as
the amount recovered (exclusive of interest) was less than $20,000. There were as Mr
Geraghty for the respondents pointed out, circumstances which could justify the course
taken by the respondents, in suing in the District Court; the matter was one within the
Court's discretion and there is nothing to show that the exercise of discretion miscarried.
In the result the damages must be reduced by $1,940 to $13,096.65 and the interest
will become $5,762.53, the total of the varied judgment being $18,859.18.
The appeal will be allowed accordingly. For the special reason given during the
hearing in this Court it is not proposed to deal with the question of costs (other than the
point just discussed) at present; the matter will be adjourned to a date to be fixed, to allow the parties to make further submissions in writing with respect to costs only, (here and
below) and that must be done within seven days.
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