Werbro Enterprises Pty Ltd v Baumann
[2012] QDC 286
•18 September 2012
DISTRICT COURT OF QUEENSLAND
CITATION:
Werbro Enterprises Pty Ltd v Baumann [2012] QDC 286
PARTIES:
WERBRO ENTERPRISES PTY LTD ACN 119 630 189
(Appellant/Defendant)AND
RAY BAUMANN
(Respondent/Plaintiff)FILE NO:
D11/2012
DIVISION:
Civil
PROCEEDING:
Appeal
ORIGINATING COURT:
Magistrates Court of Queensland at Gayndah
DELIVERED ON:
18 September 2012
DELIVERED AT:
Brisbane
HEARING DATE:
24 August 2012 (at Maryborough)
JUDGE:
RS Jones DCJ
ORDERS:
(1) Appeal dismissed.
(2) The appellant is to pay the respondent’s costs of and incidental to the appeal, to be assessed on the standard basis.
CATCHWORDS:
APPEAL – whether the learned Magistrate below had regard to evidence of an expert witness in circumstances where such evidence had been excluded at a pre-trial application – whether the learned Magistrate made findings of fact which were not open on the evidence – whether the learned Magistrate erred in law by impermissibly implying terms into the contract between the parties – whether learned Magistrate erred in failing to identify the exact cause of the damage.
BP (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266.
Devries v Australian National Railways Commission (1993) 177 CLR 472; [1993] HCA 78.
Fox v Percy (2003) 214 CLR 118; [2003] HCA 22.
Hawkins v Clayton & Ors (1988) 164 CLR 539; [1988] HCA 15.Miller and Associates Insurance Broking Pty Ltd v BMW Australia Finance Limited (2010) 241 CLR 357; [2010] HCA 31.
Secured Income Real Estate (Australia) Limited v St Martins Investments Pty Ltd (1979) 144 CLR 596.
COUNSEL:
Mr A. R. Lonergan for the appellant/defendant
Mr S. T. Courtney the respondent/plaintiff
SOLICITORS:
Kelly & Frecklington Pty Ltd Solicitors for the appellant/defendant
Payne Butler Lang Solicitors for the respondent/plaintiff
This proceeding is concerned with an appeal against the decision of the learned Magistrate sitting at Kingaroy. For the reasons set out below, the appellant failed in its appeal and the orders of the Court are:
1. The appeal is dismissed.
2. I will hear from the parties if required as to costs.
Background
The respondent at all material times was the owner of a rural property located at Mundubbera in Queensland and the appellant was an earthmoving contractor that, among other things, constructed farm dams.
In his amended Statement of Claim filed in the registry of the Magistrates Court at Gayndah, the respondent alleged that “in or before” October 2007, he entered into an oral contract with the appellant pursuant to which it would construct a dam on his property. Particulars of the contract were alleged to include:
(i) stripping the dam floor;
(ii) constructing the dam wall;
(iii) track rolling the dam wall; and
(iv) construction of a dam by-wash.
The agreed price for the construction of the dam was alleged by the respondent to be $15,000. It was also asserted that it was an implied term of the contracting that the “earthmoving, clearing and excavation work was to be conducted with the skill, care and competence of an ordinary earthmoving contractor and in accordance with good industry practice.” That this was an implied term of the contract between the appellant and the respondent was not disputed before me and, as far as I am aware, was not disputed before the learned Magistrate below.
On or about 10 January 2011, during an episode of heavy rainfall, the dam filled to capacity before the wall of the dam failed. It was alleged that the dam wall failed because the appellant did not construct the dam in accordance with the specifications of the contract and/or constructed it in breach of the implied term of due skill, care and competence. Particulars of the alleged breach of contract were:
“(i)the material used in the construction of the dam wall was too dry and not been [sic] compacted correctly;
(ii)there was insufficient material contained in the dam wall resulting in the outside batter of the dam wall being too steep;
(iii)the dam wall was constructed without sufficient free wall above the high water level of the dam and the by-wash was not low enough below the height of the dam wall;
(iv)the dam wall had not been properly top soiled.”
It was further alleged that as a consequence of the breach of contract, the respondent suffered loss and damage including the cost of rebuilding the dam wall and by-wash. The amount of $28,000 was claimed by way of damages. This appeal was solely concerned with the issue of liability.
The decision below
The learned Magistrate found that pursuant to the contract the appellant would construct a gulley dam at the site selected by the respondent and:[1]
[1]Judgment Transcript (JT) 1-13, LL 1-40.
(i) the dam would contain about 15,000 cubic yards or cubic metres of material;
(ii) consideration for the construction of the dam was $24,750;
(iii) the by-wash would be constructed to a proper standard in an area selected by the respondent;
(iv) the dam wall would be track rolled for compaction;
(v) the inner wall of the dam and the top of the dam would be covered with black clay;
(vi) the dam would be constructed with the skill, care and competence of an ordinary builder of dams and in accordance with good building practice;
(vii) the dam would be reasonably fit for capturing and storing water flowing down the subject gully.
Following from these findings the learned Magistrate found that the terms of the contract between the appellant and the respondent were breached because:
(i) the volume of material used in the dam was significantly less than $15,000 cubic yards or metres and the angle of the rear batter to the dam was too steep[2];
(ii) although the dam wall was track rolled the track rolling was not carried out properly and failed to sufficiently compact the material in the dam wall to a satisfactory standard[3];
(iii) there was a failure to place and cover the inner wall of the dam with black clay[4];
(iv) the design of the by-wash may also have contributed to the dam failure[5];
(v) that by reason of the abovementioned failings of the appellant, the dam was not constructed with the care, skill and competence of an ordinary builder of dams and, in particular, the learned Magistrate found that the material in the dam was not compacted correctly or sufficiently[6]. (Emphasis added).
[2]JT1-14, LL 2-6.
[3]JT1-14, LL 25-29.
[4]JT1-14, LL 35-37.
[5]JT1-14, LL 18-22.
[6]JT1-14, LL 43-50.
The appeal
It is agreed that this appeal is to be conducted by way of a re-hearing but not a re-hearing de novo. It was a re-hearing on the record of the proceedings below. In Fox v Percy[7] Gleeson CJ, Gummow & Kirby JJ concurring, relevantly said:
“The foregoing procedure shapes the requirements, and limitations, of such an appeal. On the one hand, the appellate court is obliged to ‘give the judgment which in its opinion ought to have been given in the first instance’. On the other, it must, of necessity, observe the ‘natural limitations’ that exist in the case of any appellate court proceeding wholly or substantially on the record. These limitations include the disadvantage that the appellate court has when compared with the trial judge in respect of the evaluation of witnesses’ credibility and of the ‘feeling of a case which an appellate court, reading the transcript, cannot always fully share. Furthermore, the appellate court does not typically get taken to, or read, all of the evidence taken at the trial. Commonly, the trial judge therefore has advantages that derive from the obligation at trial to receive and consider the entirety of the evidence and the opportunity, normally over a longer interval, to reflect upon that evidence and to draw conclusions from it, viewed as a whole.” (Citations omitted)
[7](2003) 414 CLR 118 at 125 para [23].
As their Honours recognised, however, notwithstanding those limitations, an appellate court is not excused from the task of ‘weighing conflicting evidence and drawing its own inferences and conclusions’ and having reached its own conclusions, should not shrink away from giving effect to them.[8]
[8](2003) 414 CLR 118 at paras [25]-[28]; Devries v Australian National Railways Commission (1993) 177 CLR 472.
The grounds of the appeal are that:
“1.The learned Magistrate had regard to evidence that had been excluded, namely measurements and calculations provided in the Expert Witness Report by Tony Russell.
2.The learned Magistrate made findings of fact when there was no reasonable evidence to support the findings.
3.The learned Magistrate erred in finding for the respondent when to do so was against the weight of the evidence.
4.The learned Magistrate erred in law in impermissibly implying into the contract terms that could not be implied.”
The Substantive issues raised at the hearing of the appeal were primarily concerned with the learned Magistrate’s findings concerning the volume of earth in the dam wall and the track rolling and compaction of that wall.
Implied terms
I will deal with the last of the matters raised in the grounds of appeal first. On behalf of the appellant it was contended that the learned Magistrate impermissibly implied into the terms of the oral contract between the parties an additional term or terms, namely that the dam would be constructed “properly” and “right”. It was argued that those terms could not have been express terms because there was no evidence to that effect and they could not be implied into the contract as they failed the “third and fourth limbs” of the test identified in BP (Westernport) Pty Ltd v Shire of Hastings.[9]Namely, that the implied term must be so obvious that ‘it goes without saying’ and must be capable of clear expression.
[9](1977) 180 CLR 266 at 282-283: followed in Secured Income Real Estate (Australia) Limited v St Martin’s Investments Pty Ltd (1979) 144 CLR 596.
In this context the learned Magistrate said:[10]
“I accept the plaintiff’s submissions in relation to the terms of the contract between the parties and find that they included:
(a) that Werbro Enterprises Pty Ltd would construct a gully dam at the site selected; (b) the dam would contain 15,000 cubic “yards” of material; (c) the construction costs would be about $24,750; (d) the by-wash would be constructed to a proper standard in the area to the due west; (e) the dam wall would be track rolled; (f) the inner wall of the dam and the top of the dam would be covered with black clay; (g) the dam would be constructed properly; (h) the dam would be constructed right; (i) the dam would be constructed with the skill, care and competence of an ordinary builder of dams and in accordance with good building practice; (j) the dam would be constructed with due skill and care; (k) the dam would be reasonably fit for capturing and storing water flowing down the subject galley [sic].” (Emphasis added)
[10]Trial Transcript (TT) 1-13, LL 22-38.
It seems to all to be clear that it was neither an express term nor an implied term of the contract between them that the dam would be constructed “properly” and “right”. However, it would appear that in making those findings the learned Magistrate was having regard to the evidence of the respondent, Mr Baumann, and of a Mr Wernecke[11] who gave evidence on behalf of the appellant. During cross-examination about the terms of the contract the respondent said:
“That’s right. He said the dams got to be done properly and I presumed, well, it would be done properly”.[12]
[11]Mr Wernecke was the secretary and sole director of the appellant.
[12]TT 1-61, LL 5-8.
During the evidence in chief of Mr Wernecke, he said at one stage:
“I simply lowered the by-wash so as I didn’t have to put the wall up so much, basically just to lower the – the overall cost, because I had said to him that because of the difficulties with the material and the amount of overburden that we were having to shift to get adequate clay, that it was probably going to cost a bit extra and he said, ‘Oh well, that’s fair enough. You just got to do it right.’”[13]
[13]TT 1-104, LL 10-15.
That the learned Magistrate found that the contract included a term or (or terms) that the dam was to be constructed properly and right probably was an error on his part. However, in my respectful opinion this does not assist the appellant. That finding or findings neither adds nor detracts anything from the more fundamental finding (that was not in dispute) that the contract between the parties included an implied term to the effect that the dam would be constructed with the skill, care and competence of an ordinary earthmoving contractor and in accordance with good industry practice. That the contract contained a term to that effect was found by the learned Magistrate under (i), (j) and (k) identified above.[14]
[14]At para [14].
Volume of the dam wall
It was conceded on behalf of the respondent that it was not a pleaded condition of the contract that the dam wall must contain 15,000 cubic “yards” of material.[15] However, it was submitted that while it might not have been a term of the contract, it was open for the learned Magistrate to conclude that:
“When contracting, the parties envisaged a wall of approximately 15,000 cubic metres.”[16]
[15]Respondent’s written submissions, para [11].
[16]Respondent’s written submissions, para [12]; (JT 1-13, LL 18-26).
Reliance in particular was placed on Exhibit 8 in this regard. That exhibit is dated 10 May 2007 and relevantly provided:
“Construction of gully dam – with approximate capacity of 100 + megalitres – quote only – price plus GST $24,750”.
According to Mr Wernecke, the quote was not meant to be final but only to give the respondent an idea of what the final cost might be.[17]
[17]TT 1-101, LL 18-30.
The respondent gave evidence that at or about late May to early June 2007, Mr Wernecke came to his property and “shot” a few laser levels and quoted him a rate of $1.50 per cubic metre for the construction of the dam.[18] The quoted price inclusive of GST of $24,750 at the rate of $1.50 per cubic metre is consistent with the quantity of 15,000 cubic metres of earth.
[18]TT 1-18, L 39.
I was not taken to any part of the evidence that showed in a direct way that the parties did “envision” approximately 15,000 cubic metres of soil going into the dam wall. The quote was silent on the issue and the evidence of the respondent was to the effect that he was told that the construction of the dam would require approximately 15,000 cubic metres of soil to be “moved”.[19]
[19]TT 1-18, LL 1-60; TT 1-19, LL 1-10.
Mr Wernecke, in his evidence in chief, gave no evidence about the required volume of earth to be incorporated in the dam wall. However, in cross-examination, he gave evidence that made it tolerably clear that when he gave the quote to the respondent, the dam wall, which Mr Wernecke referred to as “the bank”, was intended to have a volume of approximately 15,000 cubic yards; “not metres”.[20] On the evidence that was before the learned Magistrate, it was not, in my respectful opinion, open to find that it was a term of the contract that the dam wall would contain a volume of approximately 15,000 cubic metres (or yards) of soil. On the evidence it was, however, open to conclude that when the appellant entered into the contract to construct the dam, it considered that a volume of that order would be required to properly construct the dam wall.
[20]TT 1-114; TT 1-115, LL 1-30.
According to the appellant, there was insufficient evidence to support a finding about the volume of material in the dam wall after construction. I respectfully disagree. There was sufficient evidence to justify a finding that in fact the dam wall was “significantly less than 15,000 cubic metres or yards.”[21]
[21]JT 1-14, LL 1-7.
The respondent gave evidence that there was only about 8,300 cubic metres of soil in “that wall”[22] and was criticised for not being able to give the details of his calculations. That may have been so, but it is sufficiently clear that the estimate was not based on guess work but involved the respondent together with Mr Russell, the expert witness relied on by the respondent, taking a number of measurements.[23] It is also of at least some significance on this topic that the respondent himself had a degree of experience in earthmoving including dam building.[24]
[22]TT 1-34, L 40.
[23]TT 1-34, LL 35-50; see also TT 1-95, per Mr Russell.
[24]TT 1-13, LL 45-60; TT 1-14.
When Mr Wernecke was cross-examined on this topic he originally stated that the dam wall contained only “slightly less than 15,000”.[25] However, when it was put to him that the volume of the wall was closer to 10,000 cubic yards, Mr Wernecke replied “you’re guess is as good as mine”.[26] Answers such as this might well have been, at least part, of the reason why the learned Magistrate did not find Mr Wernecke to be a particularly impressive witness. His Honour relevantly said:[27]
“I did not find Mr Wernecke to be an impressive witness and although I would stop short of finding that he was deliberately deceptive, he seemed dismissive of concerns raised by Mr Baumann in relation to the subject dam both during construction and after construction, although some additional black clay material was spread after Mr Baumann raised concerns about the dam. I have accepted Mr Wernecke’s recollection in preference to that of Mr Baumann in relation to some matters but generally I prefer the recollection of Mr Baumann to that of Mr Wernecke.”
[25]TT 1-125, LL 20-25.
[26]TT 1-126, LL 15-20.
[27]JT 1-12, LL 1-10.
The final matter to be addressed on this issue is that the learned Magistrate wrongly took into account evidence of Mr Russell that was excluded pursuant to a ruling,[28] when reaching his conclusions about the volume of the dam wall.
[28]TT 1-97.
This argument also fails. In his reasons for judgment, his Honour said that he accepted the estimate of the respondent[29] and the evidence of Mr Russell and the respondent.[30] During his cross examination, Mr Russell gave evidence of taking certain measurements of the dam with a wheel.[31] This matter was taken up in re-examination without objection.[32] The evidence revealed that Mr Russell and the respondent jointly made measurements of the dam wall but it was actually the respondent who carried out (or had carried out) the volume calculations. That Mr Russell was not involved in carrying out the actual calculations led to paragraphs 35 (in part), 36 and 37 and appendix J to his report (exhibit 7) being excluded.
[29]JT 1-6, L 14.
[30]JT 1-14, LL 1-5.
[31]TT 1-90, LL 5-35.
[32]TT 1-94, LL 48-60; T1-95—T1-96.
The reference to the evidence of Mr Russell does not indicate to me that it should be inferred that the Learned Magistrate was referring to the excluded evidence. The reference to Mr Russell is equally consistent with an acceptance of his evidence which was not excluded. However, even accepting that His Honour might have had some regard to the excluded evidence, that does not detract from his acceptance of the respondent’s estimate of the volume of the dam wall.[33]
[33]TT 1-34, LL 35-50.
Compaction of the dam wall
Under this heading, the appellant drew my attention to the fact that the learned Magistrate did not make any findings as to whether there was any agreement between the parties as to the standard of compaction to be achieved for the dam wall and by the method by which compaction would be measured. It was not necessary for His Honour to make any specific findings about those matters in circumstances where the respondent was relying on the appellant’s skill, experience and competence in the construction of the dam. A circumstance accepted by Mr Wernecke.[34]
[34]TT 111, LL 22-30.
The learned Magistrate’s findings concerning the free wall height and by-wash[35] and those concerning the “failure” to place black clay on the dam’s inner wall[36] were not directly challenged. Instead, in what the appellant described as the “principal breach”, it challenged His Honour’s findings concerning the level of compaction of the material in the dam wall.[37]
[35]JT 1-14, LL 10-22.
[36]JT 1-14, LL 30-38.
[37]Appellant’s outline of argument, para [28].
The best evidence was that the appropriate level of compaction for the dam wall was between 95% – 100%. According to Mr Russell, compaction less than that would allow water to penetrate the dam wall and eventually cause it to fail.[38]
[38]Exhibit 7, para [20].
That a compaction rate of between 95% – 100% was appropriate, was not challenged by the appellant; instead the appellant contended:[39]
“The finding that the material in the dam wall was not compacted correctly or sufficiently formed the basis for the Magistrate’s finding that the dam was not constructed with the care, skill and competence of an ordinary builder of dams.
For the reasons outlined above, there is no evidence by which the Court could be satisfied that the material in the dam wall was not compacted correctly or sufficiently.
The evidence of Mr Russell was that there was a wide range of construction methods that could be adopted for the construction of a farm dam depending on the material being used. Mr Russell did not set out the range of methodologies in Exhibit 8 [sic] and did not give any oral evidence as to what the acceptable range of methodologies are.
The Court could not be satisfied that Werbro had breached its obligation to construct the dam with the skill, care and competence of an ordinary builder of dams and in accordance with good building practice.” (Footnotes deleted)
[39]Appellant’s outline of argument, paras [53]-[56].
It is not in contest that neither the respondent nor Mr Russell carried out or had carried out any formal testing of the compaction levels actually achieved in the dam wall. The same can be said in respect of the appellant. In the absence of any formal testing of the dam wall, the learned Magistrate accepted the evidence of the respondent and Mr Russell.[40]
[40]JT 1-8, LL 1-5.
On its own, the opinion evidence of the respondent could not, in my view, support a finding of insufficient compaction. However, that is not the case here. It was supported by the photographic evidence of the extent of erosion that occurred prior to the dam failing[41] and the expert evidence of Mr Russell. In his report, Mr Russell stated:[42]
“The lack of compaction is further demonstrated by the high levels of erosion to the inside and outside batters. A properly compacted dam wall should be set almost as hard as concrete. Once erosion commences at a point, the water continues to eat into the wall. Erosion is demonstrated in photographs A7 to A34. I understand these photographs were taken in about March 2009. They are attached and marked ‘E’.
Photographs B1 through to B12 show major and deeper erosion. By this stage the wall was clearly going to fail as water was penetrating into the wall. I understand these photographs were taken in October 2010. They are attached and marked ‘F’.
Erosion of the inside wall and the back batter of the dam is shown in photos WA1to WA8 that I understand were taken in November 2010 […].
Lack of compaction is further proved by the crumbling of the wall at the site of the blow out. Photos WB1 through to WB15 show this. These photographs which I understand were taken in February 2011, are marked ‘H’.
Photographs C1 to C3 also show evidence of the dam wall crumbling as a result of poor compaction. These photos, which I understand were taken in March 2011, are attached and marked ‘I’.
Where the dam wall breached, there are visible logs and tree roots contained in the material. This provides evidence that proper material was not used in the construction process and that the wall could not have been properly compacted. An operator using due care and skill would have avoided logs and debris of this size being included in the wall material. This is evidenced by photos A11 and A19 in section ‘E’ and photo C3 in section ‘I’.”
[41]Exhibits 2 and 3 (bundle of photographs) and Exhibit 7; A7-A34 and B1-B12.
[42]Exhibit 7, paras [27]-[32].
Inappropriate back wall batter, the failure to sufficiently topsoil (black clay) the dam wall and insufficient free wall and by-wash were also contributory factors according to Mr Russell.[43] In his conclusions, Mr Russell stated:[44]
“The main wall of the dam had failed by a large single breach in the middle of the main dam wall. In addition, the dam showed evidence of very bad erosion to the inside wall and back batter. The reasons for erosion and failure of the dam wall are:
A.The earth material used in the construction of the dam wall was too dry and [had] not been compacted correctly.
B.There was insufficient material contained in the dam wall resulting in the outside batter of the dam wall being too steep which caused the dam wall to erode and eventually sink/slump.
C.The dam wall was constructed without sufficient free wall above the high water level of the dam and the by-wash was not low enough below the height of the dam wall; and
D.The dam wall had not been properly top-soiled to avoid water erosion.”
[43]Exhibit 7, paras [33]-[35] and [38]-[41].
[44]Exhibit 7, para [25]; also Mr Russell’s oral testimony TT1-85, LL 5-20; 1-88 LL 35-60.
The learned Magistrate found Mr Russell to be an impressive witness in relation to his knowledge of the construction of earth dams, and his knowledge and experience to be “far superior” to that of Mr Wernecke.[45] I was not taken to any material to show that His Honour’s opinion of Mr Russell was misplaced and Mr Russell’s standing as an expert was not challenged in this appeal.
[45]JT 1-12, LL 12-15.
The respondent, of course, bore the onus of proving his case against the appellant. However, while Mr Russell was cross-examined about a number of matters including dam construction methodology and that he did not personally carry out any compaction tests, at no time was it put to him that his opinions and conclusions which, at face were not value improbable, were wrong or incapable of being supported by known facts. No alternate explanations as to why the dam might have failed were explored with Mr Russell or the respondent, and none were advanced by Mr Wernecke other than the possible suggestion that a more appropriate method of compaction (“water and roll”) was not adopted because of money[46] and that the subject rain event was more than expected.[47]
[46]TT 1-108, LL 12-17 and TT 1-109, LL 1-15.
[47]TT 1-113, LL 30-35.
It was open for His Honour to accept the evidence of Mr Russell on this issue. That is particularly so in circumstances where the evidence concerning the track rolling/compaction given by Mr Wernecke had little probative value and, where it did, it arguably favoured the respondent.
It is clear that the appellant did track roll, but not “water and roll”, the material in the dam wall to compact it: a fact the learned Magistrate accepted. However, when asked by reference to photographs whether they reflected an acceptable level of erosion, Mr Wernecke responded “in some countries – yes”.[48] It seems tolerably clear this should have been a reference to “country”, i.e. the nature of the soil he was dealing with. In his evidence in chief, Mr Wernecke gave evidence that he recognised that he was dealing with “highly erosive sort of country”.[49] During his evidence in chief the following exchange took place:[50]
“QIn your experience, Mr Wernecke, was the material used in the construction of the dam wall too dry?
AWell, it was dry, I don’t know how you define too dry.
QHad the material been compacted correctly?
AWell, it was compacted as much as you can compact dry material.”
[48]TT 1-122, LL 27-32.
[49]TT 1-107, L 22-28.
[50]TT 1-107, LL 45-47.
In his earlier evidence in chief the following exchange took place:[51]
[51]TT 1-102, LL 12-45.
“QAdditional excavation?
AThe – well, you’ve got your core trench, but then you’ve also got basically where you’re getting your borrow pit, whatever you want to call it, where you’re actually taking the material to build the bank.
QSo once you’ve – once you had excavated that material, what was the next step that you took?
AWell, once you’ve taken the top soil off, and you generally take it around the back of the wall, in this case I use some of that material – one scraper we’d daub it up the back of the wall, which access sort of top soil as well, but, I mean, it’s a – a way of trying to keep the costs down. So – but, I mean basically once you get down to good material you can put it from the front of the wall, you can put it anywhere in the wall once you’ve got good clay.
QAnd so once you’ve found good sorry. Did you find good clay?
AIt’s not ideal material for – it’s – works up alright if you work it up with some water and it – and it binds up. It works up ok. But it’s not what you’d call top shelf clay.
QNow did you use water in this – in the construction of this dam?
ANo.
QWhy not?
AWasn’t specified.
QHad you raised it with Mr Baumann?
ANo.
QIt simply was not specified.
ANo.”
The evidence makes it sufficiently clear that the appellant ought to have used water in the construction of the dam wall and that to compact the wall as hard as dry material could be was not an acceptable construction practice. The evidence suggests that, for its own benefit and on its own initiative, the appellant did not use water for the purpose of, keeping construction costs down.[52] The fact that the use of water was not expressly specified in the agreement between the parties is irrelevant. As has already been stated, the respondent was relying on the appellant’s skill, experience and competency in the construction of the dam.
[52]T1-125, LL 1-20.
It was also submitted on behalf of the appellant to the effect that,[53] given the price to be paid for the dam, it would have been unreasonable for the appellant to engage a “soil compacting expert, unless specifically requested”. That submission, with respect, misses the point. The respondent was entitled to expect that the appellant would carry out his end of the bargain competently, and how it achieved that end was a matter for it to determine. There was no obligation on the respondent to ask for or require a soil compaction test to be carried out.
[53]Appeal Transcript (AT) 1-5, LL 35-40.
The failure to identify the exact cause of the failure of the dam
It was further submitted on behalf of the appellant that because the learned Magistrate did not specify whether one, or some, or all of the breaches of contract which His Honour identified caused the dam to fail, “the whole of the finding is unsafe”. [54]It is true that His Honour did not expressly identify which breach, or which breaches in combination, specifically caused the failure of the dam wall. After setting out his findings concerning the breaches of the contract by the appellant,[55] His Honour went on to say:[56]
“….. On the evidence, I’ve accepted there was an unacceptable level of erosion on the dam wall and ongoing deterioration of the dam wall because of the factors of lack of compaction, lack of sufficient topsoil, that is, black clay, and that prior to the ultimate failure of the dam there was a significant crack in the top of the dam wall and that without remedial action earlier the dam wall would have continued to deteriorate and, ultimately, fail even without the rain event that ultimately led to the dam’s failure.
On the whole of the evidence I have accepted I find that Werbro Enterprises Pty Ltd’s breaches were the cause of the loss suffered by Mr Ray Baumann, the plaintiff […].”
[54]AT 1-17, LL 48-45.
[55]JT 1-14.
[56]JT 1-15, LL 10-22.
In the above quote, no reference was made to the volume of the dam wall. That was clearly an oversight on His Honour’s part and not an indication that he did not consider that to be a significant contributing factor. That inference can be drawn not only from the fact that that issue occupied so much of the Court’s time at trial, but also by reference to the fact that it was the first failure on the part of the respondent to carry out the works in an appropriate manner, made by His Honour on the previous page of his reasons for judgment.
It is not, in my opinion, fatal to the learned Magistrate’s ultimate conclusion that the appellant was liable for the respondent’s loss and damage because His Honour did not differentiate between the level of contribution to the failing of the dam wall that each of the breaches of contract made. On the evidence, it was not possible to make such specific findings and any attempt to do so would have been artificial. However, the state of the evidence was sufficient to ground the findings that (i) the appellant breached the terms of the oral contract by failing to construct it in an acceptable workmanlike manner, and, in particular, failed to place adequate volume in the dam wall and to adequately compact the dam wall; (ii) the combined effect of those breaches or in combination with the failure to adequately line the wall of the dam with black clay[57] caused the dam to fail; (iii) thereby causing the loss and damage to the respondent as assessed by the learned Magistrate.
[57]While the width of the grounds of appeal as pleaded might have been wide enough to catch the findings of the Court below concerning the clay lining of the dam, that finding was not challenged in this appeal: see appellant’s written outline, paras [9(d)] and [13].
Contrary to the submissions made on behalf of the appellant this is not a case where the findings made by the learned Magistrate were glaringly improbable and/or contrary to compelling inferences.[58] The state of the evidence in respect of the critical issues of the volume and compaction of the dam wall may not have been perfect but it was, in my respectful opinion, sufficient to ground His Honour’s conclusions and findings in respect of those matters.
[58]Fox v Percy at [128]; Miller and Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd (2010) 241 CLR 357 at 381.
For the reasons given the appeal must be dismissed. As to the question of costs the respondent seeks an order that the appellant be ordered to pay the respondent’s costs of and incidental to the appeal. Prima facie, such an order would be appropriate in accordance with the general rule that costs follow the event. However, I will give the appellant the opportunity to be heard as to costs if required.
Orders
The orders will be:
1. Appeal dismissed.
2. I will hear from the parties if required as to costs.
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