Waco Kwikform Ltd v Q-CON Pty Ltd

[2009] WADC 45

JURISDICTION     :   DISTRICT COURT OF WESTERN AUSTRALIA

IN CIVIL

LOCATION:   PERTH

CITATION:   WACO KWIKFORM LTD -v- Q-CON PTY LTD [2009] WADC 45

CORAM:   DAVIS DCJ

HEARD:   6 MARCH 2009

DELIVERED          :   27 MARCH 2009

FILE NO/S:   CIV 18 of 2009

BETWEEN:   WACO KWIKFORM LTD

Applicant

AND

Q-CON PTY LTD
Respondent

Catchwords:

Application to transfer matter from Magistrates Court to District Court

Legislation:

Magistrates Court (Civil Proceedings) Act 2004 s 16, s 17 and s 39
Magistrates Court (Civil Proceedings) Rules 2005 r 41D
Rules of the Supreme Court O 20 r 2 and r 10

Result:

Application dismissed

Representation:

Counsel:

Applicant:     Mr J C Yeldon

Respondent:     Mr G Taylor

Solicitors:

Applicant:     Tottle Partners

Respondent:     Taylor Linfoot & Holmes

Case(s) referred to in judgment(s):

Baldry v Jackson [1976] 2 NSWLR 415

Catlin v National Australia Bank Ltd [2004] WASC 135

Eshelby v Federated European Bank Ltd [1932] 1 KB 254

Freeman v McCabe [2008] WADC 125

Keene v Devine [1986] WAR 217

Servcorp (Australia) Pty Ltd v Abgarus Pty Ltd (1995) 38 NSWLR 281

Water Authority of Western Australia v AIL Holdings Pty Ltd (No. 2) (1992) 10 WAR 233 at 235

1. DAVIS DCJ:  In 2006 the applicant supplied scaffolding equipment on hire to the respondent.  The hire continued for some months, during which time invoices for the hire charges for that equipment were rendered by the applicant to the respondent, and the respondent paid those charges.  Between February 2007 and December 2007 the applicant rendered further invoices for the hire of the scaffolding and these were not paid.  At that time the outstanding invoices totalled $40,805.76

2. The applicant then decided to take action against the respondent to recover these outstanding hire charges and commenced proceedings in the Magistrates Court, by filing a General Procedure Claim, on 24 January 2008.  The respondent filed a response and notice of intention to defend. The applicant then filed a Statement of Claim General Procedure Form, with an attached statement of claim and the respondent filed a Statement of Defence General Procedure Form.  As the parties were both legally represented these documents took the form of pleadings.

3. On 18 September 2008 the applicant's solicitors wrote and informed the respondent's solicitors that the amount of the claim, as at 18 September 2008, had increased to $175,138, which exceeded the jurisdictional limit of the Magistrates Court.  The increased amount claimed related to:

   1.hire charges, from 18 May 2007 up to and including 22 August 2008 totalling $75,437.84;

   2. a claim dated 10 September 2008 for losses for goods supplied under the hire agreement and said not to have been returned, totalling $74,979.00;

   3.a claim for repairs for damage to some equipment that had been returned on 29 August 2008, totalling $4,722.00;

   4.legal costs, as at 18 September 2008, of $15,000; and

   5.interest costs of $5,000.

4. The hire charge costs for the period from 18 May 2007 to December 2007 as set out in a spreadsheet attached to the applicant's solicitors' letter of 18 September 2008, apart from some minor adjustments, relate to the same invoices as set out in the applicant's pleadings.  The rest of the amounts now claimed and forming part of the total of $175,138 are new claims which have accrued since the applicant commenced proceedings in the Magistrates Court.

5. There has been no application in the Magistrates Court to amend the applicant's General Procedure Claim or statement of claim. The applicant has applied to transfer the proceedings in the Magistrates Court to the District Court, pursuant to s 39 of the Magistrates Court (Civil Proceedings) Act 2004 ("the Act").

6. There are two difficulties with this application:

   1.The applicant's claim as it presently stands, and which is confined to hire charges between May 2007 and December 2007, is still within the Magistrates Court's jurisdiction.

   2.If an application was made by the applicant to amend the claim, it would be amending to include new causes of action which have only accrued since the proceedings were commenced. 

7. Having regard to these difficulties and to the provisions of s 39 of theAct, for the reasons which follow I decline to make an order for the transfer of the proceedings.

The grounds for a transfer of an action from the Magistrates Court to the District Court

1. Section 39(2) of the Act provides that a party to a case in the Magistrates Court may apply to a superior court (which means the District Court or the Supreme Court) for an order that all or a part of the case be transferred to the superior court.

2. "Case" is defined in s 3 of the Act as:

   "proceedings in the Court involving or in connection with the Court's civil or criminal jurisdiction." (My emphasis)

3. Section 39(4) provides that:

   "The superior court may make such an order if it is satisfied that all or a part of the case is within its jurisdiction and:

   (a)involves a claim by the claimant or other party or an issue that is outside the Magistrates Court jurisdiction; or

   (b)should be dealt with by the superior court because of its complexity or because of a question of law involved."

4. "Claim" is defined in s 3 as:

   "a claim made to the Court by a party (whether a claimant, a defendant or another party)".

5. Section 39(4) of the Act thus contemplates the transfer of an existing case, and the transfer of that case can only occur in two circumstances. Matters to do with convenience of the parties, efficiency and fairness do not arise.

6. There is no suggestion that this is a complex matter or there is any question of law involved which needs to be determined by the District Court. This application therefore is to be determined pursuant to s 39(4)(a).

The claim is within the Magistrates Court's jurisdiction

1. The description in the applicant's General Procedure Claim Form in the Magistrates Court is confined to the supply of scaffolding equipment and the respondent's alleged failure pay hire charges pursuant to the hire agreement for the period of May 2007 to December 2007. 

2. This is not a situation where the description of the claim as set out in the General Procedure Form as initially filed is unchanged, but the amount claimed has increased by virtue of further investigation and proper calculation of the applicant's loss.  If the hire charges had been miscalculated and increased beyond the jurisdiction of the Magistrates Court then the applicant might have successfully argued that the claim had remained unchanged but involved an increase in the amount of the claim to take it outside the Magistrates Court's jurisdiction: see Freeman v McCabe [2008] WADC 125. But this is not such a case.

3. The increase in the applicant's claim from the original amount in the General Procedure Form relates to new hire charges and other losses which have accrued since the filing of the proceedings in the Magistrates Court.  Claims for rent or payments which fall due under a contract after the commencement of proceedings have to be regarded as a separate cause of action: see Servcorp (Australia) Pty Ltd v Abgarus Pty Ltd (1995) 38 NSWLR 281 at 283; Eshelby v Federated European Bank Ltd [1932] 1 KB 254; Water Authority of Western Australia v AIL Holdings Pty Ltd (No. 2) (1992) 10 WAR 233 at 235.

4. The applicant has argued that the words "involving or in connection with" in the definition of "Case" in s 3 of the Act are wide enough to encompass a situation where further breaches of a contract continue to accrue after the applicant's General Procedure Claim is filed. The applicant has not, however, made any application for amendment of its case. The applicant would have difficulties doing so, as any amendment would require leave and any claim outside the jurisdiction of the Magistrates Court is liable to be struck out: see s 16 and s 17 of the Act and r 41D of the Magistrates Court (Civil Proceedings) Rules 2005 ("the Magistrates Court Rules").

5. What the applicant in effect is asking this Court to do by its application is to transfer its case, which has not been amended and which is presently within the jurisdiction of the Magistrates Court, to the District Court, after which an application will be made to amend the proceedings in the District Court to include the new claims which have accrued since the date when the Magistrates Court proceedings were filed.

6. This raises the next issue of whether it is possible to so amend.

It is not possible to amend to include new causes of action which have only accrued since the claim was first commenced

1. In an action for the recovery of monies falling due periodically and due at the date of the issue of the writ, it is not possible to amend to include a claim for a further payment which has fallen due since the issue of the writ.  This is because the amendment takes effect from the date of the issue of the writ when the cause of action for the subsequent debt did not exist: see Water Authority of Western Australia v AIL Holdings (supra).

2. Apart from instalment payments, an amendment should not be allowed to a statement of claim if it introduces a cause of action based upon facts which had not arisen when proceedings were commenced: Baldry v Jackson [1976] 2 NSWLR 415 at 419; Servcorp (Australia) Pty Ltd v Abgarus Pty Ltd (supra); Catlin v National Australia Bank Ltd [2004] WASC 135 per Newnes M at [6] to [10].

3. The applicant has argued that the decision in Water Authority of Western Australia v AIL Holdings can be distinguished because it related to  proceedings commenced by writ and the amendment of pleadings pursuant to the Rules of the Supreme Court O 20 r 2 and r 10. The applicant submitted that the filing of a General Procedure Claim in the Magistrates Court is not analogous to the filing of a writ and the Act and the Magistrates Court Rules would permit the applicant to amend its case.

4. Under the Magistrates Court Rules, a General Procedure Claim is the originating process for proceedings in the Magistrates Court: see the definition of "originating claim" in r 4 and also r 7. I consider that the principles in Water Authority of Western Australia v AIL Holdings Pty Ltd would apply irrespective of the form of the particular originating process.  The rule that amendments will not be allowed to introduce a cause of action based on facts which had not arisen when the writ was issued is a corollary of the requirement that a cause of action should be complete when proceedings are instituted: Baldry v Jackson (supra); Eshelby v Federated European Bank (supra) at 260 and Keene v Devine [1986] WAR 217 at 221. This is a long established procedural rule of wide application, although it can be amended by statute. There is nothing in the Act or the Magistrates Court Rules to displace the rule and permit an amendment to add a cause of action accruing to the applicant since the commencement of its proceedings in the Magistrates Court.

5. As I have already observed, no amendment application has been made in the Magistrate's Court and the effect of this application, which is based on the applicant's case as it presently stands coupled with the assertion of the new claims which have since accrued, is to seek to transfer the existing case, in its unamended form, with amendments to follow in the District Court.

6. Section 39(7) of the Act provides that if an order for transfer is made under subsection (4) the superior court is to deal with the case "as if it had been commenced in that court".

7. Applying the authorities and having regard to the provisions of s 39(7) of the Act, if this matter was transferred to the District Court and an application for amendment was made, the amendment could not include any cause of action which was not in existence when the proceedings were first commenced. As the case if transferred to this Court is to be dealt with as if it had been commenced in this Court (and that would be as if it had been commenced by writ) applying Water Authority of Western Australia v AIL Holdings Pty Ltd, no amendment could be made to introduce new causes of action which have accrued since the issue of the proceedings on 24 January 2008.

Conclusion

1. I am not satisfied that this application meets the requirements of s 39(4)(a). The applicant's case in the Magistrates Court, which relates to a claim for equipment hire charges between February and December 2007, falls within the jurisdiction of that Court, and not the District Court.

2. Although the applicant now wishes to also claim charges and other losses which have accrued since the filing of its proceedings in the Magistrates Court, those are new claims based on facts which have arisen since the Magistrates Court case was filed.

3. If the applicant wishes to pursue these claims in the District Court, fresh proceedings will need to be commenced.