Vaughan v Robertson
[2002] NSWSC 1106
•21 November 2002
CITATION: Vaughan v Robertson & Ors [2002] NSWSC 1106 CURRENT JURISDICTION: Common Law Division
Administrative Law ListFILE NUMBER(S): SC 30058 of 2002 HEARING DATE(S): 30 October 2002 JUDGMENT DATE: 21 November 2002 PARTIES :
David Vaughan (Plaintiff)
v
Bo Robertson (First Defendant)
Scott Robertson (Second Defendant)
Consumer, Trader & Tenancy Tribunal (Third Defendant)
JUDGMENT OF: Master Malpass
LOWER COURT
JURISDICTION :Consumer, Trader & Tenancy Tribunal LOWER COURT
FILE NUMBER(S) :HB 00/71266 LOWER COURT
JUDICIAL OFFICER :David Baker - Tribunal Member
COUNSEL : Mr J K Kirk (Plaintiff)
Mr Peter Stitz (First and Second Defendants)
N/A (Third Defendant)SOLICITORS: The Builders' Lawyer (Plaintiff)
Turnbull Bowles Lawyers Pty Ltd (First and Second Defendants)
I V Knight - Crown Solicitor - Submitting Appearance (Third Defendant)
CATCHWORDS: Statutory construction (meaning of "to enforce any other remedy") - no errors of law. LEGISLATION CITED: Home Building Act 1989, Div 1 of Pt 2, ss 4, 5, 6, 7, 8, 9, 10 and 11, s 10 (3), s 49. CASES CITED: De More Constructions Pty Ltd v Garpace Pty Ltd (2001) 53 NSWLR 132.
Edwards v J E Bignall Pty Ltd (1985) 2 NSWLR 392 at 397.
Elkateb v Lawindi (1997) 42 NSWLR 396 at 406.
Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247.DECISION: See Paragraphs 44 - 45.
IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION
ADMINISTRATIVE LAW LISTMaster Malpass
Thursday 21 November 2002
JUDGMENT30058 of 2002 David Vaughan v Bo Robertson & Ors
1 Master: The plaintiff is a builder. The first and second defendants (the defendants) are the owners of the property known as 22 Anglo Square Carlton (the property).
2 The parties entered into a building contract for work to be performed at the property. The contract was in the standard form created by the Department of Fair Trading for home building contracts.
3 Soon after commencement of work on or about 8 November 1999, disputes arose between the parties. I shall mention certain of the areas of dispute. They were said to relate to the making of progress payments and whether or not Council approved plans had brought about variations which were not included in the contract price.
4 The plaintiff purported to invoke the machinery of the provisions of clause 25 of the contract (which gave a right to end the contract) which led to a purported attempt to do so on about 2 March 2000. This right has been referred to as a right of termination.
5 The defendants brought proceedings in the Fair Trading Tribunal (the Tribunal) claiming damages for breach of contract. The plaintiff made a quantum meruit claim (by way of cross-claim).
6 The application was heard by a Tribunal Member (Mr Baker). On 18 May 2001 he determined a question of liability in favour of the defendants (inter alia he found that the plaintiff had not validly terminated the contract). This has been referred to as the liability judgment.
7 On 18 June 2002, the Tribunal determined further questions of liability and the quantum of the defendants’ claim. The plaintiff was ordered to pay the sum of $103,173 plus costs. This has been referred to as the quantum judgment.
8 The plaintiff brings this appeal against the decisions made by the Tribunal. It was said that he relies on the grounds set forth in the Grounds of Appeal (save for those to be found in clauses 13 and 14). Certain of them were not really pressed in oral argument. The avenue of appeal open to the plaintiff is limited to error of law. The plaintiff bears the onus of satisfying the court that the decisions of the Tribunal should be disturbed.
9 Written submissions have been made on behalf of the parties. In the case of the plaintiff, these are very lengthy submissions. The submissions were supplemented by further lengthy oral argument.
10 Before the Tribunal, it was is not in dispute that the plaintiff had committed a breach of s 8 of the Home Building Act 1989 (the Act). The plaintiff had received a prohibited payment (a deposit in excess of the amount allowed). An admission was made to that effect and the hearing was conducted on the basis of there being such a breach. During the appeal, there was a half-hearted attempt to revisit this matter.
11 Before proceeding further it is convenient to now refer to the relevant provisions of the Act. These are provisions contained in subs (3) of s 10. The section is found in Division 1 of Part 2 of the Act. Part 2 is headed “Regulation of residential building work and specialist work”. Division 1 is headed “Contracting for work”. Division 1 consists of sections 4 – 11. Section 10 itself is headed “Enforceability of contracts and other rights”.
12 Subsection (3) is in the following terms:-
- “A person who contracts to do work in contravention of this Division or who contracts to do work under a contract that does not comply with this Division:
- (a) is not entitled to damages or to enforce any other remedy in respect of a breach of the contract committed by any other party to the contract, but
- (b) is liable for damages and subject to any other remedy in respect of a breach of the contract committed by the person.”
13 The grounds that were argued were condensed into a smaller number of appeal issues. The approach taken by counsel was to argue those issues.
14 The first of them concerned the proper construction to be given to (a) of subs (3) of s 10. The effect of the submission made on behalf of the plaintiff was to give a restricted meaning to the words “or to enforce any other remedy”. It was the plaintiff’s case that the exercising of the right conferred by clause 25 was not the enforcing of a remedy. Initially counsel could not give a general description of the restriction. Later, he expressed it to be in terms that a builder in breach cannot seek to enforce a state provided remedy or order used to assert contractual rights.
15 There was little doubt that what appears in (a) could have been better expressed. However, it seems to me that the legislative intent was moderately clear. The aim was to protect consumers (De More Constructions Pty Ltd v Garpace Pty Ltd (2001) 53 NSWLR 132) and s 10 was intended to enhance the prospect of compliance with ss 7 and 8. Non-compliance attracted not only penalties, but loss of entitlements at law as well.
16 Counsel for the plaintiff has stressed the distinction that has been drawn between rights and remedies. There have been competing submissions on the question of whether “remedies” included extra-curial remedies. There has been reference to what has been said in many decided cases concerning this and similar provisions. Despite the reference to many cases, counsel were not able to refer to any case in which the present question had been decided. Whilst what has been said in cases provides guidance, in the circumstances of this case the subsection has to be construed having regard to the objects of the legislation, the particular language used by Parliament in the subsection and to its context.
17 At first blush, the heading to s 10 might be thought to stand at odds with the content of the subsection. The heading refers to enforceability of contracts and other rights. The subsection refers to “remedy” and not to “rights”. It might be though that the words “is not entitled to damages” could be read as taking away both a right and a remedy. However, the language of (a) would suggest that damages is being treated as a remedy and that what has been taken away from the builder is that remedy together with any other remedy in respect of a breach of the contract committed by any other party to it. The remedies contemplated by the provision are restricted to those available in respect of a breach of contract. The plaintiff places emphasis on the use of the word “enforce” as indicating an intention to exclude the mere exercise of a contractual right. The word had not appeared in earlier similar legislation. I do not accept that it has the effect contended for by the plaintiff. Further, it seems to me that if the Parliament had intended to merely take away remedies involving court proceedings, it would have expressly said so.
18 In my view, a right conferred by clause 25 of the contract is a remedy within the meaning of subs (3). Accordingly, I consider that the plaintiff was not entitled to rely on it in respect of a breach of the contract committed by the defendants.
19 This view finds support in what was said by Hodgson J (as he then was) in Edwards v J E Bignell Pty Ltd (1985) 2 NSWLR 392 at 397 and by Giles CJ Comm D (as he then was) in Elkateb v Lawindi (1997) 42 NSWLR 396 at 406. Both observed that “remedy” was not restricted to remedies involving court proceedings.
20 It does not seem to be in dispute that what has been described as the liability judgment was in reality the determination of a separate issue which determined liability in respect of part of the claim for damages brought by the defendants. The end result of that decision was a finding that the plaintiff did not validly terminate the contract (or more accurately, that he did not bring it to an end). In my view, the plaintiff has failed to demonstrate any basis for the disturbing of that decision.
21 I have first addressed this question of statutory construction because this was how it was handled by the parties. I shall now proceed to another submission made by the defendants on this question of liability. It is said that the decision can be upheld without addressing the question of construction. The defendants say that there was a finding by the Tribunal that irrespective of the breach of the provisions of s 8, the plaintiff was not entitled to invoke the provisions of clause 25. The clause can only be invoked where there is unremedied default. Whilst the position is not entirely clear, the decision contains observations which may be read as a finding to the effect that the defendants were not in default.
22 I now turn to what has been described as the quantum judgment. It is in fact a decision which deals with questions of both liability and quantum.
23 It appears that during the hearing that led to this decision, the plaintiff sought to agitate again two liability questions which had been raised in the earlier hearing. It was said that the contract was void for uncertainty. It was said that it was unclear as to what were the contract documents. These submissions were rejected.
24 In this appeal, a major ground of appeal is an alleged failure to properly determine the material terms of the contract. This ground occupied considerable court time. The basis for this submission was that there were at least four sets of plans which were all different and could describe the work to be done under the contract.
25 Unfortunately, the contract was entered into prior to Council approval. Indeed, work was done under it prior to that time. The contract refers to attached drawings prepared by Kajetan Bartall & Associates. These are expressed to form part of the contract. The contract price was expressed to be $182,355. The contract contains provisions for variations which take into account inter alia changes to the plans brought about by Council (where such variations could not reasonably have been foreseen by the contractor).
26 In the liability judgment, the Tribunal found that the parties intended to be bound by the contractual documents together with the Council approved plans. In my view, this is in substance a finding that the agreement between the parties is to be found in the executed contract documents as modified by the approved Council plans.
27 In my view, this is a finding which was not only reasonably open to the Tribunal, but was the correct finding. The contract was conditional upon approval being granted. Upon approval being granted, the parties then proceeded with a contract which required performance of the work identified in the approved plans (inter alia the plaintiff proceeded with the performance of work as identified in those plans).
28 It was one of the plaintiff’s submissions that the contract price had been increased by reason of variations arising from the approved plans. It is now put that the Tribunal failed to take these matters into account in the assessment. I shall return to this matter in due course.
29 I now turn to another matter which was at least mentioned if not pressed as a ground of appeal. In a sense it was sought to re-agitate the question of whether or not the plaintiff was in breach of s 8 of the Act. It was not really argued. If it was intended to be pressed as a ground of appeal, I do not consider that the plaintiff should be allowed to raise it now in this appeal. The hearing before the Tribunal was conducted throughout on the basis of the plaintiff’s admission of such breach.
30 The defendants claimed inter alia for completion costs, rectification costs, water damage and loss of amenity. The plaintiff submits that each of these heads of damage was a hotly contested issue. The hearing of these matters occupied about five hearing days. The Tribunal made a finding that the plaintiff was liable to the defendants for damages for breach of contract. It also found that the plaintiff had the right to pursue a quantum meruit claim. In accordance with submissions, it dealt with the quantum meruit in the approach taken to assess damages. The plaintiff was allowed what was found to be the reasonable value of the work (the evidence of Mr Williams was accepted on this question).
31 The Tribunal made findings as to the credibility of witnesses. These findings were material to the assessment of damages. I shall mention certain of the findings. The member was not impressed by the evidence given by Mr Crowe (one of the plaintiff’s witnesses). He preferred the evidence of Mr Williams (an expert called by the defendants) to the evidence of Mr Crowe. He noted that the plaintiff was not called to give evidence on the question of damage. He accepted the evidence of Mrs Robertson, (one of the defendants) on the issue of damage. He accepted the evidence of Mr Williams in relation to the amounts produced by the plaintiff. He preferred the reports given by Mr Williams to that which had been provided by the late Mr Glashier (one of the plaintiff’s prospective witnesses who died prior to the hearing).
32 The findings in his judgment conclude with the following paragraph:-
- “34. Accordingly I assess damages for the Applicants as follows. It should be noted that the figures have been rounded out to take into account the amount payable for GST and the marginal increases for increased costs in building.
Contract price $182,355
Less value of work completed $112,224
Balance $ 78,130
Plus damage – loss ofCompletion costs $106,000
Less outstanding $ 78,130
Balance $ 27,130
Plus rectification costs $ 45,336
Water damage $ 12,206
Additional $ 2,501
Less 10% GST $ 6,000
Balance $ 60,043
TOTAL $ 103,130
- Accordingly the Respondent is liable to the Applicants in the sum of $103,130.00.”
33 Both sides complain that there are minor mathematical or other errors which require correction. The defendants say that the errors lead to a situation where the total should be in the sum of $103,173. The plaintiff says that there has been some duplication of GST in that the figure given for rectification costs includes a GST component. The error is said to be in the order of about $4,000.
34 The plaintiff complains of a lack of findings and of an inadequate expression of the Tribunal’s reasoning process. In developing this argument it was further said that the Tribunal had failed to comply with provisions of the Act (s 49).
35 It can be said that the expression of reasoning process may be described as sparse. However, it is well established that what is required will vary from case to case depending upon its nature and circumstances. Reasons need not be given in every case. They need not be lengthy or elaborate (see inter alia Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247).
36 There is a clear expression of the ultimate findings. There are clear findings on the question of credibility. Reasons are given for these findings.
37 For present purposes, I shall put aside the findings made as to loss of amenity. I shall return to that matter in due course.
38 As to other matters, the Tribunal accepted the evidence of Mr Williams. There seems to be no dispute that Mr Williams gave the evidence which established both the liability and quantum for those heads of damage. When this material is examined, by implication the findings and the reasoning process supporting those findings are sufficiently clear. In my view, it suffices to enable this Court to deal with the appeal brought on these matters.
39 For completeness, I should add that it is common ground that the evidence of Mr Williams was given in respect of the original drawings as modified by Council approval.
40 I am not satisfied that the Tribunal was in breach of any relevant statutory provisions. Section 49 is a provision that enables a party to obtain a statement of reasons where such reasons are not given at the time of the decision. The section has no present application. Even if a different view had been reached, the question would then arise as to what impact such a finding had on the Tribunal’s decision. As this matter was not argued, I put it aside.
41 Mrs Robertson gave evidence on the head of loss of amenity. Her evidence was not challenged. There was no competing evidence. It is not suggested that the Tribunal was given any guidance as to the amount that should be allowed for this head of damage. It was left to do its best in the circumstances and make a judgment as to the appropriate amount. It was not said that it fell outside the range. I am not satisfied that the quantification made in respect of this head of damage should be disturbed.
42 There is a further minor matter of appeal. It arises out of what was said in paragraph 32 of the quantum judgment concerning the evidence of Mrs Robertson. It may be said that the reasoning process could have been better expressed. In my view, the court should look to substance rather than form and to read the paragraph in context. I apprehend that it was intended merely to say that her uncontradicted evidence was accepted. It was the only evidence before the Tribunal on the question and it was open to it to accept her evidence and make the finding that it did.
43 There remains the question as to whether adjustment should have been made in relation to the amounts allowed inter alia for contract price by reason of the alleged variations. The difficulty for the plaintiff is that he has an evidentiary deficiency (the lack of probative evidence is conceded in the written submissions). This aspect of the case depended on what was to be said by Mr Crowe. The material that was tendered was not admitted into evidence. There were further problems for the plaintiff. It would have to be shown that the variations could not have been reasonably foreseen. It has not been suggested that this matter was addressed by the plaintiff. In the circumstances, this aspect of the appeal also fails.
44 Save as to one matter, I propose to make the following orders:-
The Summons is dismissed. The plaintiff is to pay the costs of the Summons. The Exhibits may be returned.
45 I have suggested to the parties that they explore the reaching of agreement to correct the minor errors. If this can be done, the errors may be corrected by substituted order and the appeal can be otherwise dismissed.
0
3
1