TOMBLESON v STEVENTON - [2017] SASC 100

SUPREME COURT OF SOUTH AUSTRALIA
(Magistrates Appeals: Civil)
TOMBLESON v STEVENTON
[2017] SASC 100
Judgment of The Honourable Justice Vanstone
7 July 2017
MAGISTRATES - APPEAL AND REVIEW - SOUTH AUSTRALIA - APPEAL TO SUPREME COURT
APPEAL AND NEW TRIAL - APPEAL - PRACTICE AND PROCEDURE - SOUTH AUSTRALIA - OTHER MATTERS
Appeal against judgment by default. Where service on the defendant was ineffective. Where the defendant was unaware of the proceedings. Where the Magistrate awarded damages in the plaintiff’s favour. Where the defendant filed an interlocutory application in the Magistrates Court seeking to have the judgment set aside. Where the Magistrate declined to set the matter aside. Where the appeal was out of time.
Whether enough was done to inform the defendant of the proceedings. Whether the Magistrate should have ordered personal or substituted service. Whether to extend the time within which to appeal.
Held: Appeal allowed. Time within which to appeal is extended. The judgment entered in the Magistrates Court is set aside. The claim is remitted to the Magistrates Court.
Building Work Contractors Act 1995 (SA); Magistrates Court (Civil) Rules 2013 (SA) r 12, r 53; Fair Trading Act 1987 (SA), referred to.

TOMBLESON v STEVENTON
[2017] SASC 100
Magistrates Appeal: Civil

VANSTONE J: In this appeal I am asked to set aside an award of damages by a Magistrate, which award was made without the applicant/defendant ever having appeared. The defendant claims to have had no knowledge of the proceedings and indeed, process sent to him by mail by the Magistrates Court was returned to the Court.
Background
In about June 2014 the plaintiff/respondent engaged the defendant/applicant to build a substantial shed on the plaintiff’s property at Salisbury Heights. Work began but disputes arose between the two men. In April 2015 the plaintiff took the issue to the office of Consumer and Business Services and some sort of conciliation took place. As a result an “Instrument of Agreement” was signed between the two parties on 2 September 2015. That instrument stipulated what work was to be completed as well as a completion date of 27 November 2015. Little if any further work was done.
On 5 May 2016 the plaintiff filed an application under the Fair Trading Act 1987 (SA), effectively suing on the Instrument of Agreement, seeking a total of $30,138.
On 3 June 2016 the Adelaide Magistrates Court sent a Notice of Directions Hearing, advising both parties of a hearing to be held on 29 June. The defendant’s copy was sent to an address at Kalington Road, Strathalbyn. In due course the defendant’s copy was returned to sender and he failed to appear on 29 June.
On 6 July 2016 the Court sent to both parties a Notice of Assessment advising that the matter had been set down for assessment of damages on 21 July 2016. The defendant’s copy went again to the Strathalbyn address. Again it was returned to the Court. A second Notice of Assessment was then sent to the defendant at a new address, apparently provided by the plaintiff, being care of Old Noarlunga Post Office, Old Noarlunga. That too was returned to sender.
On 21 July, again, the defendant did not appear. The Magistrate plainly determined to proceed in his absence. It is not clear from the Magistrates Court record whether any particular attention was paid to the question of liability, but the outcome is recorded as “request for assessment of damages”. Evidence was then taken from a person who said he had long experience as a builder. He had assessed the cost of remedying the defects in the defendant’s work at $32,500, excluding GST. The Magistrate determined that GST should be added to that sum and awarded total damages of $36,338, including costs of the filing fee, the plaintiff’s attendances and the builder’s attendance.
On 29 November 2016 the defendant filed an interlocutory application in the Magistrates Court seeking to have the judgment set aside. In an accompanying affidavit he claimed that he was overseas when judgment was entered, that he was unaware of the matter and that he had never received court papers. His address was given as Commercial Road, Seaford. In a later affidavit the defendant averred that his first knowledge of the action was when he was served with a sealed copy of the Magistrates Court order on 26 November 2016.
The matter came before the same Magistrate who declined to set the judgment aside, saying he had no power to do so, as the order made was a final order.
Arguments on appeal
The defendant applies for an extension of time within which to appeal. The following dates are relevant. As mentioned, judgment was entered on 21 July 2016. On 23 November 2016 the defendant was served personally with the orders. On 2 December 2016 the defendant applied to set aside judgment. That application was heard and refused four days later on 6 December. Therefore, the extension sought is from the date of the assessment to the date when the notice of appeal in this Court was filed, being 5 May 2017. However, it could be argued that the operative date in terms of the exercise of a discretion is 6 December 2016.
The defendant argues on appeal that the Magistrate had inadequate proof of service of the claim. He argues that an order for substituted service should have been made under r 53 of the Magistrates Court (Civil) Rules 2013. He argues that a duty of candour was imposed on the plaintiff as a party who was appearing ex parte and that the plaintiff should have advised the Court that, throughout the process, he did not receive any response whatsoever from the defendant to his email letters, phone calls, or text messages. The appellant has brought evidence that during the relevant period he moved from his existing home address, abandoned his post office box at Strathalbyn and did not collect mail from his new post office box at Old Noarlunga. Indeed, he says that during the period 10 July to 22 July 2016 he was in Hawaii. Those dates took in the time when the Court sent a second notice of assessment, this time to the Old Noarlunga post office box. In any event, like previous process, this was returned to sender. It also took in the time when the assessment was conducted. The defendant further asserts that during the relevant period he was struggling with mental health issues and was not paying attention to his business affairs. In relation to the claim itself, the defendant asserts that he was kept out of the property at relevant times and was therefore unable to perform the rectification work which he had agreed to undertake.
The plaintiff claims – and I accept – that he acted in good faith at all times. He accepts that the defendant was unresponsive to telephone calls, SMS messages, email and Australia Post mail over the relevant period although previously these modes of communication had been effective. He also tried to contact the defendant through Ranbuild, a company which he knew had dealings with the defendant. That avenue was unsuccessful. He says that he ascertained that the defendant’s mail was being redirected to the Old Noarlunga post office and he advised the court of that matter. He points out that under the Building Work Contractors Act 1995 (SA) the address provided to the Commissioner for Consumer Affairs is deemed to be an effective address for service.
He maintains that the defendant’s claims that he denied access are not born out on the material before the Court and that the defendant has been inconsistent on that topic. He argues that the defendant was given extensive access over the relevant period. On this basis he argues that the defendant has not demonstrated an arguable defence.
Consideration
The course which these proceedings have taken is most unfortunate. It is regrettable that more attention was not paid to the fact that letters advising the defendant of the proceedings were returned to the sender. These included, not only the original claim and notice of the first directions hearing, but the notice of assessment, which was first sent to the Strathalbyn address and later to the Old Noarlunga post office. In the face of these developments I consider that the Court should have insisted on personal service, or at least made orders in relation to substituted service.
What occurred on 21 July was effectively that judgment on liability was entered by default, and an assessment of damages conducted. There were unsatisfactory aspects of the assessment of damages in any event. One of those, as pointed out by the defendant’s counsel, was that the claim seems to have been amended at the instigation of the Magistrate by the addition of an amount for GST. Plainly, no notice of the amendment was given to the defendant. This meant that the judgment sum was more than $6,000 in excess of the amount originally claimed. Both those sums were in excess of the original quote for the works upon which those works proceeded.
Whether the defendant has an arguable defence to the claim is of diminished importance in circumstances where the entire process appears to have miscarried. In any event, the defendant says he has and I am in no position to assess the competing claims about access to the work site.
When the matter came to the Magistrate on 6 December he declined to set aside the judgment, on the basis that it was a final judgment. Whether or not that was so, it remains the case that there was effectively a default judgment on the question of liability and this was entered without there being any evidence that the defendant knew of the claim.
I do not place at the plaintiff’s feet any fault in the way this matter has developed. He was unrepresented throughout and he acted in obedience to all instruction given him by the Magistrates Court.
Conclusion
In the circumstances I see no option but to allow the application for an extension of time within which to appeal and to allow the appeal. In relation to the extension, it is true that several months elapsed after the defendant’s unsuccessful application to set aside judgment. However, having regard to the fact that he was unrepresented and that he was plainly labouring under some mental health challenges, I do not consider that his failure to act more quickly should be held against him.
The orders I made are as follows:
1Extend the time within which to appeal to 5 May 2017.
2Allow the appeal.
3Set aside the judgment entered in the Magistrates Court on 21 July 2016.
4Remit the matter to the Magistrates Court for hearing before another Magistrate.