Walsh v Clouting

[1999] NSWSC 1000

CITATION:	Walsh v Clouting [1999] NSWSC 1000
CURRENT JURISDICTION:	Common Law Division
FILE NUMBER(S):	11018/99
HEARING DATE(S):	31 August 1999
JUDGMENT DATE:	31 August 1999
PARTIES :	John Walsh (Plaintiff) Kathleen Margaret Clouting (Defendant)
JUDGMENT OF:	Bell J at 1

COUNSEL :	Mr D A Allen (Plaintiff) Mr M J Walsh (Defendant)
SOLICITORS:	Lincoln Smith & Company (Plaintiff) Falvey Byrnes Associates (Defendant)
CATCHWORDS:	LOCAL COURTS; Appeal (Justices Act 1902 (NSW) Part 5); whether Magistrate erred in law in refusing application for recall of witnesses; whether open to Magistrate to conclude that defendant had suffered loss justifying award of damages
ACTS CITED:	Local Courts (Civil Claims) Act 1970 Justices Act 1902
DECISION:	Plaintiff's Summons dismissed; the plaintiff to pay the defendant's costs of the proceedings as agreed or assessed

THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

Tuesday, 31 August 1999

BELL J

11018/99 - JOHN WALSH v KATHLEEN MARGARET CLOUTING

JUDGMENT

1    HER HONOUR: This is an appeal brought pursuant to s 69 of the Local Courts (Civil Claims) Act 1970 against the determination of a Magistrate given in the Local Court at Newcastle on 1 April 1999. Having regard to the date of the determination, Pt 5 of the Justices Act 1902 and Pt 51B of the Supreme Court Rules apply to the proceedings.
2    The plaintiff seeks an order that so much of the verdict and judgment of the Magistrate in which he:

(a) entered verdict and judgment for the defendant in the amount of
$17,141.06;
(b) entered verdict for the defendant on the plaintiff’s cross-claim; and
(c) ordered the plaintiff to pay the defendant’s costs
be set aside.

3    The plaintiff further claims that in lieu of such verdict and judgment that there be entered in favour of him as against the defendant:

(a) a verdict for the plaintiff on the defendant's claim;
(b) an order that the defendant pay the plaintiff's costs of the claim;
(c) a verdict and judgment for the plaintiff on his cross-claim against the
defendant for $4,652.75; and
(d) an order that the plaintiff pay the defendant's cross-claim.

4    Alternatively, the plaintiff seeks an order that the matter be remitted to a Magistrate to be dealt with according to law.
5 Six grounds of appeal are pleaded in the statement filed pursuant to rl 8 Pt 51B SCR.
6    Mr Allen, who appears for the plaintiff, has only pressed grounds 1 and 2 as they appear in that statement. Grounds 3 to 5 inclusive were abandoned. Ground 6, I note, merely contends in a compendious way that grounds 1 to 5 constituted errors on the part of the Magistrate. Ground 1 is in these terms:

"That his Worship was in error in refusing to allow the appellant to cross-examine the respondent in relation to whether or not a contract had been made between the appellant and the respondent for the erection of a shed on the respondent's land on the grounds that an alleged admission to that effect had been made by the appellant's former counsel."

7    The proceedings before the Magistrate occupied five days of hearing between 26 October 1995 and 5 July 1996. The matter came on for hearing before the Local Court by way of re-hearing following an arbitration which took place in late 1994.
8    Shortly prior to the date fixed for the hearing of the matter, the plaintiff's counsel sought an adjournment. A date fixed for hearing had earlier been vacated on the plaintiff’s application upon the basis that he was not ready to proceed.
9    It is against this background, and in the light of the matters as set out in a chronology which was handed up on the hearing of this appeal, that the Magistrate refused the belated application that the hearing be adjourned. It commenced on 26 October 1995. The plaintiff's then counsel, Mr De Pinna, was not in attendance and the matter proceeded with the plaintiff appearing unrepresented.
10    Evidence was taken on 26 October 1995, 29 February 1996, and 1 March 1996. On each of these occasions the plaintiff was unrepresented.
11    The matter was adjourned part heard from 1 March 1996 to 5 July of that year. On the latter occasion, Ms Coombes of counsel appeared for the plaintiff.
12    On 5 July an application was made on the plaintiff's behalf that the defendant be recalled in order that Ms Coombes could take up with her a number of matters which her client had neglected to put in the course of his cross-examination.
13    That application was opposed by Mr Byrnes, the solicitor who appeared for the defendant. Mr Byrnes noted that his client's case had closed. He submitted that it would work unfairness to him to have her recalled at this late stage in the proceedings. He drew attention to the circumstance that the plaintiff had the opportunity, notwithstanding his lack of legal training, to question the defendant about the subject matters during the course of her evidence given on 26 October 1995. His Worship determined that the appropriate course was to accede to Ms Coombes’ application. The defendant was then recalled and cross-examined by Ms Coombes. Thereafter, Ms Coombes opened the plaintiff’s case and called him.
14    At an early stage in her examination of the plaintiff, objection was taken to evidence being led of a conversation between the plaintiff and the defendant which took place at their first meeting around May of 1992. The basis of objection was that the terms of the conversation had not been put to the defendant in the course of cross-examination by the plaintiff. Ms Coombes had not cross-examined the defendant as to the conversation when she was recalled.
15    The Magistrate heard submissions from both Mr Byrnes and Ms Coombes. He took a short adjournment to refresh his recollection as to the course of the examination of the defendant on the earlier occasion and to permit the parties to do so.
16    Thereafter, the Magistrate ruled that he would not allow evidence to be led from the plaintiff as to the subject conversation.
17    The decision as to the admission or rejection of evidence made in the exercise of the Magistrate's discretion is not one with which this Court would lightly interfere.

18    Ms Coombes did not disclose the nature of the material such as to demonstrate that it was desirable in the interests of justice that the defendant be further recalled notwithstanding that she had once been recalled and that the plaintiff’s case had now been opened.

19    There is nothing to indicate the substance of the conversations which it is said were of such critical importance.

20    Mr Allen points to an exchange between the Magistrate and the plaintiff on 26 October 1995 just before the plaintiff commenced his cross-examination of the defendant. The Magistrate is recorded as saying this at p.52:

"Now, Mr Walsh, you have the opportunity of asking Mrs Clouting questions in relation to the evidence that she has given, matters that are relevant to the proceedings before the Court. Ask your questions one at a time, give her an opportunity to answer, don't argue with her. You ask questions, she answers. If you don't agree with what she says you can ask her other questions about the topic, but you can't disagree with her. Your opportunity to do that arises later if we get to a stage of you giving evidence, do you understand me?"

21    Mr Allen submits that the Magistrate's advice was capable of misleading the plaintiff in so far as it might have been taken by him as indicating that it was not open to him to disagree with the witness in the sense of putting a proposition to her in cross-examination inconsistent with an answer that she had given.
22    Mr Allen submitted in the light of the above that the exercise of the Magistrate's discretion must be said to have miscarried. The plaintiff was denied the opportunity of giving evidence of conversations which Mr Allen stated related to the question of whether a contract had been formed for the construction of a shed on the defendant’s property and, if so, the terms of any such contract. It was a matter of such crucial importance that, even at the very late stage in the day when his counsel sought leave to have the defendant further recalled, the proper exercise of the discretion compelled such a result.
23    It should be noted that during the course of the defendant's opening to the Magistrate on 26 October, it was said by Mr Byrnes, who appeared for her by way of an outline of the plaintiff's case, as Mr Byrnes apprehended it, that:

"As I understand it he says there was no such agreement between the parties. Mrs Clouting was constructing a home and shed on her property and Mr Walsh was asked to help out when he could, do some labour, buy some materials which he did. He never had any agreement to build the house or the shed."

24    Later, during the course of that day (T74), Mr Byrnes asserted that it was his understanding that there was no dispute between the parties as to an agreement on the part of the plaintiff that he would construct the shed (as distinct from the house) on the defendant's property.

25    This appears to have been a reference to a letter, Exhibit F, written by Mr De Pinna, the plaintiff's then counsel. It is dated 19 July 1995. In paragraph 4 of that letter the following statement appears:

"The defendant alleges he agreed to construct a shed, only - as alleged."

26    Mr Allen says that the admission in the letter was limited to his client’s agreement to construct a shed. The terms of that agreement were germane to the issues before the Magistrate. Accordingly, notwithstanding the admission, Mr Allen maintains that such prejudice was done by the Magistrate's refusal to allow the evidence that I would conclude that his discretion miscarried.

27    During the course of the plaintiff's cross-examination of the defendant on 26 October 1995, Mr Byrnes is recorded as making an objection and observing (T64):

"There has been cross-examination for half an hour now and we haven't had one question about the agreement between the parties, whether she took photos, when she took the block. I really don't see the relevance of it."

28    This is but one instance when it appears in the course of the proceedings prior to the plaintiff obtaining representation it was drawn to his attention that he might ask questions of the defendant as to the terms of the agreement. I note from the Magistrate's reasons that he assessed the plaintiff as a person of ability, albeit one facing the difficulties that any person would who seeks to represent himself when not legally trained so to do.
29    In the light of the circumstance that when the matter came back before him on 5 July, at a time when the plaintiff was legally represented, the Magistrate allowed the recall of the defendant in order to overcome any difficulties associated with the earlier cross-examination and having regard to the way the matter was agitated on the plaintiff's behalf at pages 7 to 10 of the transcript of 5 July1996, I do not consider that the plaintiff has made good the submission that the Magistrate erred in law in refusing Ms Coombes’ application.
30    Ground 2 is in these terms:

"His Worship was in error in entering a verdict for the respondent for $4,038 for alleged rectification costs to the shed in circumstances where there was no evidence before his Worship that the respondent had performed her part of the contract by payment to the appellant of the contract price".

31    Mr Walsh, who appears for the defendant, submits that the plaintiff is estopped from relying on this ground. It is necessary for me to refer to the history of the matter after the conclusion of evidence on 5 July 1996 in order to understand that objection. The Magistrate on 6 November 1996 gave what I might characterise as preliminary reasons for decision in the matter. In the concluding portion of those reasons he noted that he had realised he required the assistance of the parties' representatives on a number of issues as set out at page 9 of his reasons. He re-listed the matter with a view to entertaining further submissions.
32    Thereafter on 20 December 1996 his Worship delivered himself of further reasons. At the conclusion of those reasons he noted that he was unable, on the material available to him, to determine a number of issues relating to costs. For that reason he proposed obtaining further submissions from the parties' representatives. He set a timetable for the receipt of those submissions and went on to state that he would, "Formally give final judgment on the action and subsidiary matters on Friday, 21 February 1997".
33    Thereafter it appears that the plaintiff, Mr Walsh, commenced proceedings by way of stated case under the procedure which then applied in relation to appeals from Magistrates exercising jurisdiction under the Local Courts (Civil Claims) Act.
34    The matter came on for hearing before his Honour Sully J on 7 May 1998. It appears that his Honour received evidence and embarked on a detailed consideration of a number of factual matters by reference to the transcript of the proceedings before the Magistrate. At a late stage in the day the parties drew to his Honour's attention the circumstance that the Magistrate had not purported to make a final determination. His Honour concluded that he did not have jurisdiction to deal with the appeal.
35    His Honour made a number of observations concerning the evidence and the approach identified by the Magistrate in his reasons. Relevantly, at pages 5 and 6 of his Honour's judgment, the following appears:

"So far as concerns that part of the proposed verdict for the plaintiff that has reference to the cost of rectification work, the position seems to me to be as follows:

(1) The learned Magistrate has made a distinct finding that there was a contract between the appellant and the respondent for the building by the appellant for the respondent of a shed at a cost of $10,000. It was not suggested in argument today that such a finding was not reasonably open to the learned Magistrate on the evidence before his Worship."

36    His Honour went on to observe that the Magistrate had made what he described as an equally clear finding concerning the existence of building defects in the shed and to note that such a finding was "clearly open to the learned Magistrate". He then noted that it had been necessary by reference to admissible evidence to quantify the reasonable cost of rectifying the building defects. His Honour noted that the Magistrate had had before him a document marked as exhibit 16 and that by reference to that document the figure of $4,438 had been identified. His Honour noted that he saw no reason to question the availability of that conclusion. His Honour further noted the considerations that led the Magistrate to deduct the sum of $400 from that global figure and again to conclude that it was open to the Magistrate to arrive at that finding.
37    It is this aspect of his Worship's judgment, namely his verdict for the defendant in the amount of $4,038 for alleged rectification costs to the shed, that is the subject of ground 2. That ground has been developed before me as a no evidence ground. Mr Walsh suggested that in the light of the way the matter proceeded before his Honour Sully J, the plaintiff was estopped from taking such a point. Having regard to the circumstance that his Honour concluded that he had no jurisdiction to deal with the stated case, I do not believe it can be said that the plaintiff is estopped, although the failure to take the point now taken in the light of the portion of his Honour's reasons which I have earlier quoted is notable.
38    In the way Mr Allen has developed the argument, he takes no point that there was not evidence before the Magistrate to justify a finding that an amount of $4,038 was an appropriate figure for the reasonable costs of rectifying the defects in the shed. Rather, Mr Allen points to a passage appearing at page 8 of the Magistrate's reasons given on 1 April 1999. His Worship observed:

"It seems to me that the evidence of the plaintiff in relation to the various amounts paid is somewhat vague and uncertain and in all the circumstances it seems to me that I could not, with any confidence, make a finding as to what was paid to the defendant as payment for work done by him and what was paid to him as the plaintiff's agent to be passed on by him to others for whom materials or services were obtained."

39    The submission is put in this way: it is clear that the Magistrate accepted that of the money paid by the defendant to the plaintiff an amount was referable to payment for work done by him, being building work, and other amounts represented payments to him as agent for the defendant in connection with the supply of materials or services by others. Given the inexact nature of the evidence given by the defendant as to these matters, his Worship was unable to conclude what, of any payment made by the defendant to the plaintiff, was referable to his services as a builder, and what represented payments to him in his capacity as an agent. Mr Allen goes on to say in such a circumstance the Magistrate could not have been satisfied on balance that the defendant had incurred a loss. The shed must have been of some value. Absent clear evidence of payments to the plaintiff for building work in excess of the sum of $4,038 there was no evidence of loss.

40    There was a conflict in the evidence before the Magistrate concerning payments by the defendant to the plaintiff. It was the plaintiff's evidence he was paid some money by the defendant. This was of the order of $3,000. He was not able to say what that payment represented. Against this, the defendant gave evidence that she had paid him an amount of $28,956. It was contended that the payment of that sum had not been put in issue following the service on the plaintiff of a Notice to Admit Facts. I understand his Worship to have accepted, in total, a sum of the order of $28,956 was paid by the defendant to the plaintiff.

41    His Worship was not able to determine with any precision how much of that sum represented payment for the plaintiff’s services and how much had been paid to him as an agent. However, I consider that his Worship must be taken to have concluded that the defendant had paid to the plaintiff an amount for the construction of the shed in excess of the sum awarded by him by way of damages for rectification of the same. It was the defendant’s evidence that the cost of the shed was going to be about $10,000 (26 October 1995, page 31 line 40 and following). The plaintiff did not cross-examine Mrs Clouting to the effect that he had not been paid in connection with the construction of the shed.

42    It was not asserted by the plaintiff in his evidence-in-chief that he had not been paid for work carried out in relation to the construction of the shed. Ms Coombes addressed no submissions in this respect. The matter complained of in this ground was not a live issue before the Magistrate. To seize on his Worship’s observations at page 8 of the Judgment of 1 April and urge that there was no evidence that the defendant had suffered loss seems to me to introduce a somewhat artificial element to the proceedings. I consider that it was open to the Magistrate to conclude overall that the defendant had suffered loss justifying the award of damages in the amount of $4,038 in connection with necessary rectification work to the shed. Accordingly, I dismiss the plaintiff’s summons.
43    I order the plaintiff to pay the defendant’s costs of the proceedings as agreed or assessed.

**********

Last Modified: 09/30/1999