Trestrail and Trestrail v Briggs No. Scgrg-99-566 Judgment No. S413

TRESTRAIL & ANOR v BRIGGS
[1999] SASC 413

Full Court: Doyle CJ, Debelle and Wicks JJ

DOYLE CJ. Mr and Mrs Trestrail brought proceedings against Dr Briggs, claiming $1,275 for “work and materials supplied”. Dr Briggs filed a defence and counterclaim. She admitted that the work was done and that the materials were supplied. She counterclaimed damages on the basis that the work was done in breach of a contract between her and the Trestrails. The damages that she counterclaimed included the cost of remedial work.
The matter was tried in the District Court, over some 10 days. The Trestrails recovered judgment on their claim for $825. Dr Briggs recovered judgment on her counterclaim for $28,500.
The Trestrails appealed against the decision.

Facts

The story is a rather complicated one, and there were substantial conflicts between the evidence of Mr Trestrail and the evidence of Dr Briggs. Some of what follows is common ground. Much of it reflects the findings of the trial Judge on disputed matters.
Dr Briggs owns a block of land in the Adelaide Hills. The land slopes quite steeply down to the only road frontage, which is the Sturt Valley Road. The land is heavily treed. Dr Briggs had plans drawn for the erection of the house.
Dr Briggs required approval from the local council to construct a driveway for motor vehicles to gain access to and from Sturt Valley Road. Dr Briggs met on the site with Mr Trestrail, an experienced earth moving contractor, to discuss the matter. This was on 27 March 1992.
The Judge found that Dr Briggs wanted the access point for the driveway to be near the north eastern corner of the land. It could not be right at the corner, because of a stobie pole. He found that Dr Briggs told Mr Trestrail that, and that she told him that she wanted the driveway to run across the block in a westerly direction. That meant that it would run fairly steeply uphill from Sturt Valley Road. She told him that the driveway was to finish near a point on the block identified by reference to an existing brick path. That point was fairly high up on the block.
It must have been obvious that the driveway was going to be fairly steep. Dr Briggs accepted that. Indeed, she wanted a proposed carport at the end of the driveway to be fairly high up on the land, and so it was necessary from her point of view that the driveway be fairly steep.
On the Judge’s findings, that was the entrance point discussed, the approximate direction of the driveway and the sort of driveway to be constructed. The Judge found that on 31 March 1992 Mr Trestrail quoted a price of between $4,000 and $4,500 to construct the driveway as proposed.
The Judge found that Mr Trestrail warned Dr Briggs that the gradient might be too steep for him to take the driveway right to the pre-existing brick path, and that it might end up a metre or two lower. He found that Dr Briggs said that that would be acceptable, were it necessary.
The Judge made no specific finding about the extent of the work to be done by Mr Trestrail. My understanding is that it comprised cutting and levelling the block as required, and creating a reasonably level surface for use as a driveway. It did not include paving or sealing the surface of the drive, nor did his quotation include work such as retaining walls or drains.
Dr Briggs apparently accepted the quote.
Dr Briggs then obtained council approval to construct the access point from the land to Sturt Valley Road. That approval was granted by letter dated 29 June 1992. The council gave its approval. The approval appears to have related only to the construction of the access point. I mention that the planning approval for the construction of the house and associated works was granted by the council on 15 April 1992.
I have the firm impression from the Judge’s reasons that the council took no real interest in the route to be followed by the driveway, and that the council’s only concern was with the access point to the roadway. This impression is reinforced by the fact that the Council readily approved a different access point at a later stage. I will refer to this shortly.
The council approval of the access point was given by reference to a plan which is Exhibit P2. As it happens, the plan shows the proposed carport a good deal lower on the block (closer to Sturt Valley Road) than Dr Briggs said she wanted the carport to be. The plan P2 assumed some significance during the trial. Mr Trestrail’s case was that he did not make the agreement that Dr Briggs claimed he made. He denied that he agreed to construct a driveway as described above, and at the price referred to. He relied upon the fact that the plan by reference to which the council gave its approval appeared to contradict Dr Briggs’ evidence about the siting of the proposed carport. But the Judge found in due course that the position of the carport on P2 did not reflect any decision made by Dr Briggs, and that in that respect the plan was not prepared with her authority. It is not necessary for present purposes to examine how he reached that conclusion.
Mr Trestrail began work on site on 2 November 1992. But he cut an access point at the north western corner of the block. In terms of the frontage to Sturt Valley Road, that was at the opposite end of the block to the end at which Dr Briggs wanted the access point. Mr Trestrail said that the instruction to commence at the north western corner came in the form of a plan provided by Dr Briggs. He said it was given to him about a month before he began work. He says that the plan showed the position of the carport in a position very similar to the position depicted in P2. It is worth mentioning that while P2 showed the carport lower on the block than Dr Briggs said she wanted, it did show the access point near the north eastern corner. Mr Trestrail said that the plan given to him differed from P2 in that the access point was shown further west than the access point on P2. Mr Trestrail was not able to produce the plan at trial. Dr Briggs denied ever giving to him any such plan. The Judge rejected Mr Trestrail’s evidence. He accepted Dr Briggs’ denials of ever having given any such instruction to Mr Trestrail.
On 3 November 1992 Dr Briggs attended at the site to inspect progress. She found that Mr Trestrail had begun at the north western corner. He was constructing a driveway that involved a very sharp turn left as one came off Sturt Valley Road, and then ran back across the block towards a position for the carport as depicted on P2. The work was well advanced. It would have been difficult to undo it. Council officers were present. They said that they were prepared to allow access at this point.
From Dr Briggs’ point of view the access point was completely wrong. The drive was being constructed on an alignment that would finish at a point at which she specifically did not want the carport. Dr Briggs gave evidence that she told Mr Trestrail that this was not what she wanted. She said he claimed that it was better to do things the way he was doing them. He justified the changed access point to her on the basis that traffic conditions meant that it would have been dangerous to do work at the north eastern corner, at least without some delay to the work. Dr Briggs said that she told Mr Trestrail that his proposal for the positioning of the carport was unacceptable. Mr Trestrail then told her that if he constructed a “switchback”, he could run the driveway uphill to about the point at which she originally had wanted the carport. This would mean that a person entering the driveway from Sturt Valley Road would initially do a sharp left turn, then travel towards the eastern boundary of the block, then do a sharp right turn to travel uphill. Dr Briggs agreed to the proposal, but did so on the basis of an assurance from Mr Trestrail that she would be able to drive to the carport, without having to reverse her car to get around the bends.
The work was completed by Mr Trestrail. Dr Briggs moved into the house early in 1993.
The Judge found that the work that Mr Trestrail carried out was in breach of the Trestrails’ agreement with Dr Briggs. She had wanted a drive that ran in a fairly straight line uphill from Sturt Valley Road to her carport. Mr Trestrail had produced a driveway with two sharp turns, and of a completely different configuration and with a different access point.
The Judge found that soon after taking up occupation Dr Briggs rang Mr Trestrail to complain of difficulty navigating the driveway. The corners were too tight. Mr Trestrail agreed to widen the two bends, and to spread some rubble. He did some other work on the site at the time, unrelated to the drive. This was the work the subject of the Trestrails’ claim. The Judge found that $450 worth of the work was attributable to work on the driveway, and the other $825 worth of the work was for work unrelated to the driveway.
It was when the Trestrails sued for the whole amount of $1,275 that Dr Briggs denied liability, and counterclaimed damages for the cost of substantial remedial works.
At trial, Dr Briggs put forward two bases for the assessment of damages. They were based on plans and cost estimates prepared by Mr Coombe, an engineer. The first was called Option A. It involved cutting an access point at the north eastern corner of the property. The stobie pole, which had been close to the corner, had by then been moved. That made it possible to start the drive, under Option A, closer to the corner than had been possible when Mr Trestrail quoted for the job. The driveway under Option A ran in a roughly straight line to the carport, as originally proposed. The last part of it traversed the approximate line of the driveway constructed by Mr Trestrail. Option A also involved closing off the existing access point, and, as I understand the evidence, filling the original driveway and restoring that part of the land to something approximating its original condition. The estimated cost of all of this work was $33,000. The other approach put forward was called Option B. In broad terms, Option B involved improving the driveway constructed by Mr Trestrail. To make the driveway reasonably usable Mr Coombe proposed widening both of the sharp turns to a significant extent. There was also some levelling and flattening to reduce the grade somewhat. Option B involved some significant cutting of the land, particularly at the second turn after one entered the driveway. There was a need for retaining walls and other related works. As well, because the cut would be quite close to the house, there would be an additional cost for works necessary to provide access around the house and close to the cut. This would involve a retaining wall and some protective fencing would be required at the top of the cut. The estimated cost of all this work was about $27,500, but I gather that that figure did not include the cost of the retaining wall and fencing at the top of the cut just referred to. That work was likely to cost approximately $9,000.
The Judge found that the Trestrails had agreed to construct a driveway, with access at the north eastern corner of the land, as described by Dr Briggs. On those findings they had not complied with their contract. The Judge found that Dr Briggs did not agree to vary the contract. He found that the work done by Mr Trestrail was a breach of the contract. He found that the driveway constructed by Mr Trestrail was not a usable driveway, because Dr Briggs could not negotiate it without engaging in manoeuvres that could not reasonably be expected. The Judge concluded that there was a substantial breach of the contract by the Trestrails, and that the appropriate measure of damages was the cost of providing a reasonably usable driveway.
In the end, the Judge assessed damages by reference to Option A. But he reduced the damages awarded under this head to $28,500, on the basis that some of the items included in Option A were matters that were in any event the responsibility of Dr Briggs. Bearing in mind the likely additional cost of fencing if Option B were to be pursued, it appears that in the end the Judge awarded damages by reference to the cheaper of the two methods of providing a usable driveway.
As it happens, Option A involves an access point slightly closer to the north eastern corner of the site than was originally proposed. However, as I understand the evidence, this slight shift in the access point did not involve any increase in cost.

The Contract

Mr Meyer, counsel for the Trestrails, made a vigorous attack upon the Judge’s finding that the Trestrails agreed to construct the driveway commencing near the north eastern corner of the site, and travelling in the direction and to the position described by Dr Briggs. He attacked the credibility of Dr Briggs, arguing that on a number of issues her evidence was unreliable or was contradicted by other evidence. He relied in particular upon Exhibit P2. He pointed to some inconsistent conduct by Dr Briggs. He called in aid evidence from certain other witnesses, submitting that that evidence conflicted with the evidence of Dr Briggs on material matters.
All of these matters were carefully considered by the trial Judge, in a very detailed judgment. The Judge seemed to have examined every issue raised by Mr Meyer.
The Judge said that Dr Briggs did not impress him favourably as a witness. At times she was vague and evasive. At times she did not answer questions satisfactorily. The Judge found that on some matters, on which Mr Trestrail had diary notes, his evidence was more accurate and reliable. But the Judge also found that on some topics Mr Trestrail’s evidence was so inconsistent with other evidence that he found to be more credible and acceptable, and was so inherently implausible, that he was unable to accept Mr Trestrail’s evidence on crucial issues. Thus, the Judge made it clear that he did not accept the evidence of either of the key witnesses at face value, and was careful to consider such independent support as there was for the evidence of those witnesses.
I do not find it necessary to deal individually with the criticisms that Mr Meyer made of Dr Briggs’ evidence, or with the particular attacks that he made on the Judge’s findings. I found no acceptable basis in Mr Meyer’s submissions for disturbing the Judge’s findings on the central issues of fact. There was nothing inherently incredible about Dr Briggs’ evidence. Certain aspects of Mr Trestrail’s evidence appear to me to be dubious. I find no flaw in the Judge’s reasoning on the important issues of fact, and I bear in mind that he also had the benefit of seeing each of the witnesses give evidence at length. I am simply unpersuaded that the Judge’s factual findings should be overturned.
Mr Meyer argued that Mr Trestrail would not have made the agreement that Dr Briggs claimed was made, because a driveway beginning near the north eastern corner, and aligned as Dr Briggs wanted it, would not have been usable. In support of this submission Mr Meyer relied upon certain evidence from Mr Coombe. Mr Randle, counsel for Dr Briggs, submitted that this was a misreading of the evidence of Mr Coombe, and that the effect of his evidence was that a usable driveway could have been constructed in accordance with Dr Briggs’ original proposal. I agree with this submission by Mr Randle. Mr Coombe said that this could be done provided that Dr Briggs was prepared to accept that the proposed driveway might have to finish a metre or so below the level of the existing brick path, in order to achieve an acceptable gradient. As I have indicated earlier in my reasons, Dr Briggs’ evidence was that from the outset she told Mr Trestrail that that would be acceptable.
In the end, Mr Meyer’s submission was no more than a re-argument of the issues addressed before and by the trial Judge. The duty of this Court requires it to examine the matter for itself, paying due regard to the advantage of the trial Judge, particularly on matters turning upon an assessment of the credibility of a witness. But the Court does not lightly depart from the findings of a trial Judge, especially when they are not shown to be inherently improbable or contrary to significant evidentiary material that the Judge has accepted or should have accepted. To a considerable extent the submissions of Mr Meyer were based upon evidence that the Judge did not accept. As I have already said, my view is that nothing put forward by Mr Meyer raises a significant doubt about the Judge’s findings.

The Breach

If the Judge’s finding as to the terms of the contract stands, a finding of breach was inevitable.
Plainly enough, the Judge did not find that Dr Briggs agreed to vary the contract. What she did was to accept what must have seemed to be the inevitable. When she came to the site the work was well advanced. It was hardly practicable to go back, undo what had been done, and start again. I do not agree that, by allowing Mr Trestrail to proceed as she did, Dr Briggs is taken to have agreed to a variation of the contract. There may have been an element of uncertainty about the state of affairs on that day. But, on the Judge’s findings, Dr Briggs made it plain that what Mr Trestrail had done was not acceptable to her. She could have instructed Mr Trestrail to cease work, but did not. But her failure to do so does not mean, in my opinion, that she was agreeing to a variation of the contract. She was simply accepting the substitute performance, in breach of the contract, for what it was worth. That left it open to her to make such claim as might be available to her, arising from the breach of contract. For example, even if the substitute driveway had been quite usable, a claim for a diminution in the value of the land might have been open to her.
But as things transpired, the driveway was not reasonably usable, and the Judge so found. That being so, Dr Briggs remained entitled to exercise her rights under the original contract. She was entitled to claim damages, and not merely nominal damages on the basis that she had been provided with a substitute but quite usable driveway.
For those reasons I reject the submission by Mr Meyer that, by allowing Mr Trestrail to complete the driveway proposed by him, Dr Briggs lost any rights to assert remedies available under the original contract. I accept that if the substitute performance had provided her with a usable driveway, Dr Briggs probably could have recovered only nominal damages. Principles relating to the mitigation of damages would have required her to accept the substitute performance as a reasonable performance in mitigation of her loss. But the substitute performance was not satisfactory.

Estoppel

At a late stage of the trial Mr Meyer sought to argue that Dr Briggs’ conduct in permitting Mr Trestrail to complete the driveway, if not a variation of the contract, gave rise to an estoppel. As I understand it, the submission is that Dr Briggs was aware of the facts relating to the breach of contract, and by permitting Mr Trestrail to proceed, rather than stopping him then and there, she had caused him to act to his prejudice in completing the driveway in the manner proposed by him. Mr Meyer submitted that it would be contrary to the assumed state of affairs for Dr Briggs now to assert a claim for damages based on the original contract. If she was going to assert the original contract, she should have done so when she came to the site. Mr Meyer submitted that if an estoppel did not arise, then Dr Briggs’ counterclaim was defeated by laches, by delay or by acquiescence.
The trial Judge pointed out that none of these matters were pleaded by the Trestrails. The Judge declined to allow any of these defences to be raised late in the trial. I consider that the Judge was right. The defences should have been pleaded. It seems to me that from the outset the Trestrails’ case was, or should have been, that they performed the work as agreed or, if they did not, they completed the work on the basis of an understanding with Dr Briggs that she would accept it as substitute performance. I cannot see any justification for failing to plead these matters.

In any event, I consider that no injustice has been done to the Trestrails. The Judge found that Dr Briggs permitted Mr Trestrail to proceed specifically on the basis of an assurance that the driveway as proposed by him would be usable. The Judge made a strong finding that the driveway was not usable. This finding was supported by an inspection that the Judge made of the site, and observations made by the Judge of Dr Briggs’ manoeuvring her car on the driveway. The substitute performance by Mr Trestrail was defective. If there was an estoppel, or some other basis for refusing to allow Dr Briggs to assert her rights under the contract, justice would surely require that she be at liberty to do so if the basis of any acceptance of the substituted performance was found to be an unfulfilled assurance that the substituted performance would provide a usable driveway.
In connection with this submission Mr Meyer complained that the Judge decided that the driveway constructed by Mr Trestrail was not reasonably usable, without Mr Meyer having been given a fair chance to meet Dr Briggs’ case on this point. I have difficulty understanding the complaint. The fitness of the driveway for use as a driveway seems to have been a central issue from the outset. Mr Meyer failed to make clear to me in what respect he was not given a fair opportunity to test Dr Briggs’ claim that the driveway was not usable. In part his complaint seems to have been that, through one of her witnesses, Dr Briggs led evidence to the effect that the driveway was not satisfactory because it did not comply with a standard that was applied by reference to the turning requirements for what was described as the “85th percentile vehicle”. My impression is that this was no more than a way of assessing the suitability of the driveway. The standard of the driveway to be constructed was always an issue. Mr Meyer had his opportunity to argue that the standard just referred to was not an appropriate standard under the circumstances of the case.
I reject the submissions under this head.

Illegality

At trial, Mr Meyer argued that Dr Briggs’ claim should fail because to award her damages would infringe the principle that a court will not enforce an unlawful contract. The argument appears to have been that the council gave its approval for the construction of the driveway by reference to P2. Dr Briggs was relying upon a contract pursuant to which the driveway would extend to a point higher on the land than the position of the proposed carport shown on P2. Therefore, the contract was for the construction of a driveway that did not accord with the council consent, and accordingly gave rise to a breach of the Planning Act 1982 or the Development Act 1993. The Judge found that the contract was entered into before the council gave its approval, and that accordingly it was not a contract to perform work in contravention of the council approval. Although the Judge’s conclusion on this point was challenged in the Notice of Appeal, no submissions were put on appeal in support of the argument.
I must say that I have the firm impression that the council was unconcerned about the location of the driveway on the site. Its only concern appears to have been the location of the access point to Sturt Valley Road. That was the effect of Mr Coombe’s evidence. As well, the council approved of the access point proposed under Option A, closer to the north eastern corner of the land. The contract upon which Dr Briggs relied was a contract to construct the driveway with an access point approved by the council. Unless satisfied that the council required that the positioning of the driveway on the site be submitted to it for approval, I would not find that a basis for the plea had been made out. Not being satisfied of that matter, it is unnecessary to consider this point any further. I express no view upon the reasoning of the trial Judge.

Damages

On the basis of the Judge’s findings, Dr Briggs was entitled to damages for breach of the contract to excavate and construct a driveway in accordance with the contract between Dr Briggs and the Trestrails. The driveway constructed by the Trestrails did not comply with the terms of that contract. Nor was it a usable driveway. The Trestrails were therefore not entitled to a finding that Dr Briggs must accept the substitute driveway as a substitute performance that mitigated her loss.
It was appropriate to assess the damages by reference to the reasonable cost of constructing a driveway as originally agreed or, if it was reasonable to require Dr Briggs to accept a substituted form of performance, the reasonable cost of that substituted form of performance.
Option B, as designed by Mr Coombe, involved carrying out improvements to the driveway constructed by the Trestrails. Had the cost of Option B been less than the cost of Option A, in my view it would have been appropriate to assess damages on that basis. In saying that I assume, of course, that Option B would produce a usable driveway. As I understand the evidence Option B could not reasonably be rejected as a mode of substituted performance that was unacceptable. However, on the Judge’s findings the cost of Option B would have been higher than the cost of Option A. I have already referred to the Judge’s findings and to the evidence on that point. That being so, it was open to the Judge to assess damages by reference to the cost of Option A.
Even if Dr Briggs had agreed to vary the contract on 3 November 1992, and to accept a driveway aligned as proposed by Mr Trestrail, the same result would follow. The driveway that Mr Trestrail constructed was not usable. The varied contract was not performed. Option A was a cheaper way of remedying this breach than was Option B.
Mr Coombe’s estimate of the cost of Option A was $33,000. The Judge found that some of the work involved in Option A was work for which Dr Briggs would in any event have been responsible. On that basis he deducted $5,500, and awarded the sum of $28,500.
However, some issues arise in relation to the assessment of damages.
As I understand Mr Coombe’s evidence, his estimate of the cost of the items for which Dr Briggs would in any event have been responsible was about $9,000 and not $5,500 as found by the Judge. These items were the cost of providing a spoon drain, the cost of reinstating part of the bitumen surface and the cost of providing what was described as the upper moss rock wall and some related terracing. The figure of $9,000 is approximate only, but that appears to me to be about the right amount.
If that is so, then the damages awarded to Dr Briggs should have been reduced to $24,000, rather than to $28,500.
That figure of $24,000, and the amount awarded by the Judge, is not just the cost of constructing a new driveway. It includes $3,500 being the cost of closing off the driveway constructed by the Trestrails. It follows that the damages attributable to the cost of constructing the new driveway is an amount of approximately $20,500.
In submissions before this Court, Mr Meyer complained that the effect of the Judge’s finding was to require the Trestrails to meet the cost of providing to Dr Briggs a better driveway than she would have received had Mr Trestrail carried out the original agreement, and he further complained that the Judge was requiring the Trestrails to meet costs that would have been met by Dr Briggs under the original arrangement. Mr Meyer did not examine in any detail the composition of the damages awarded by the Judge. The examination that I have made indicates that the relevant comparison is not one between $28,500 and the figure quoted by the Trestrails, but a comparison between $20,500 and the figure quoted by the Trestrails.
I have no doubt that some of the difference between those two figures is explicable on the basis that it is now more expensive to do the work than it would have been before Mr Trestrail began work on the site. By this I mean that doing the work now involves working over existing work, to some extent, and remedying difficulties created by the original work. However, after a careful reading of Mr Coombe’s evidence I am unable to ascertain just how the Judge ensured that the amount that he awarded for damages did not include the cost of work that would have been the responsibility of Dr Briggs, and included only the cost of constructing a replacement driveway and dealing with problems created by the work that Mr Trestrail had done. The significant difference between the amount quoted by Mr Trestrail, and the figure of $20,500 that I have arrived at as the approximate cost of the new driveway, is sufficient to make me think that the Judge might have included the cost of work that was never the responsibility of the Trestrails and was not made necessary by their defective performance.
I suspect that the costs incurred by the parties in this matter already exceed the damages under consideration. It is desirable to resolve the outstanding issues without increasing substantially the costs that have been incurred. For those reasons, I consider that this Court should hear further submissions from the parties, in the hope that it can resolve the issue of damages. Those submissions should be confined to the issues that I have identified, and in particular the cost of implementing Option A, including the cost of any work for which Dr Briggs was responsible in any event, on the basis that Option A is a proper basis for the assessment of damages. If the Court can satisfy itself as to the proper amount of damages, the matter can then be resolved. If not, regrettable as it is, the case will have to be remitted to a District Court Judge to assess the damages on the basis of Option A. That is regrettable, but may be unavoidable.
DEBELLE J. I agree with the reasons of the Chief Justice and the orders he proposes.
WICKS J. I agree with the reasons given by the Chief Justice.

[1999] SASC 413

24 September 1999