Williams v Jack
[2013] TASSC 67
•14 November 2013
[2013] TASSC 67
COURT: SUPREME COURT OF TASMANIA
CITATION: Williams v Jack [2013] TASSC 67
PARTIES: WILLIAMS, Chantal Suzanne
v
JACK, Robin Peter
JACK, Sharyn
FILE NO: 229/2011
DELIVERED ON: 14 November 2013
DELIVERED AT: Hobart
HEARING DATE: 30, 31 January 2012
JUDGMENT OF: Wood J
CATCHWORDS:
Procedure – Inferior courts – Tasmania – Local courts – Appeal and new trial – Appeal to Supreme Court – Generally – Whether magistrate erred in law or fact – Action for breach of contract – Duties of magistrate in respect of unrepresented litigant – Issue estoppel – Whether breach causative of damage.
Building Act 2000 (Tas) ss33, 35, 40, 42, 43, 44(1)(c).
Evidence Act 2001 (Tas), s64(3).
March v E & MH Stramare Pty Ltd (1991) 171 CLR 506; Carl Zeiss Stiftung v Rayner & Keeler Ltd [No 2] [1967] 1 AC 853, applied.
Kuligowski v Metrobus (2004) 220 CLR 363, considered.
Aust Dig Procedure [424]
REPRESENTATION:
Counsel:
Appellant: B Cassidy
Respondents: W A Ayliffe
Solicitors:
Appellant: Page Seager
Respondents: Murdoch Clarke
Judgment Number: [2013] TASSC 67
Number of paragraphs: 67
Serial No 67/2013
File No 229/2011
CHANTAL SUZANNE WILLIAMS v ROBIN PETER JACK and SHARYN JACK
REASONS FOR JUDGMENT WOOD J
14 November 2013
This appeal concerns a decision by Magistrate R Pearce (as he then was) in relation to a dispute regarding building work performed at a house in William Street, Ulverstone in Tasmania. The builder was the first respondent, Robin Jack, and the house was owned by the appellant, Chantal Williams. The building work commenced in about July 2005. The first respondent stopped work in October or November 2005 after a dispute arose with the appellant. His accounts for the work and associated expenses totalled $43,703, and he had been paid $16,885. The appellant commenced proceedings in the Supreme Court, claiming that the contract was for a fixed amount and that the work the first respondent did was defective and incomplete. The proceedings were against Mr Jack, his wife, Sharon Jack and the Central Coast Council ("the Council"). The proceeding was not served on the Council. The respondents defended the claim and brought a counterclaim with respect to the accounts which were unpaid, in the sum of $26,818 and interest. The proceedings were transferred to and heard in the Magistrates Court. At the hearing, the action against Mrs Jack was not proceeded with, and no order was made against her or in her favour. However, she is a respondent to this appeal. Before disposing of this appeal, I will clarify this matter with counsel with a view to amending the notice of appeal and deleting her name.
The appellant claimed damages from the first respondent for breach of contract, negligence, breach of statutory duty, and for misleading and deceptive conduct. In substance her case, as summarised by the magistrate, is that:
"(a)Mr Jack agreed to perform structural repair to the northern section of the house, replace the existing deck above the carport and redevelop the carport under the deck in accordance with plans drawn up by her engineer, Ken Moore;
(b)the work would be performed for the fixed price of $20,000.00 and completed within 2 weeks of commencement;
(c)she entered into the agreement in reliance on Mr Jack's representations that he would do the work for $20,000.00 within 2 weeks of commencement, in a good and workmanlike manner and in accordance with the plans;
(d)Mr Jack:
(i)took too long to do the work;
(ii)poured the new footings on an inadequate foundation that had not been approved by Mr Moore;
(iii)constructed the deck at such a level that the carport could not be used as a car port;
(iv)performed other work negligently and in breach of contract,
as a result of which she suffered loss caused by the delay and the expense of having to perform rectification work."
The first respondent contended there was:
"… no fixed price, that he did not take too long, that he poured the footings with approval and that the foundation is adequate in any event and not the cause of the further problems that appeared. He says it was not part of the agreement to make the garage comply with any height regulations and that, with some minor exceptions, there wasn't anything wrong with the rest of his work. To the extent that any work is incomplete he says that it is also minor and he has not charged for work he did not perform."
The first respondent counterclaimed payment for the building work he performed.
Background
The appellant was the owner of the house as I have mentioned. She and her partner – who have since married - decided to undertake some structural repairs to the house with a view to putting it on the market. The problems requiring repair, as summarised by the magistrate, were the footings under the northern wall, as well as the wall itself, which were cracked. The concrete deck on the western side at the front was also badly cracked. She wanted to fix the structure and replace the concrete deck with a timber deck. The first respondent provided a quote of $20,000 to replace the footings on the northern wall at the front side of the house, to replace the deck above the carport, and to line the room downstairs. The appellant stipulated an engineer, Ken Moore, was to do engineering drawings for the project and was to approve the work to be done.
Mr Moore prepared a document called a Certificate of Others (Building) which provided his certification that the structural works, if constructed in accordance with the drawings, would comply with the Building Code of Australia. The Building Permit was issued on 15 June 2005, subject to a condition that the work be performed in accordance with the certificate of likely compliance. That certificate required that the structural work be carried out in accordance with Mr Moore's drawings.
The first respondent started work on the project in July 2005. The respondent sent out accounts as the work progressed. The appellant became concerned that she was being overcharged and, after inspecting the house in November, she was also concerned about the quality of the work. A Council building surveyor inspected the house and made a list of matters requiring attention. In the same month the Council issued to the first respondent two "Building Inspection Directions", requiring him to rectify work not complying with the building permit. However, he could not undertake the work because the appellant wrote to the respondent in late November, informing him that he was not to enter the property. The appellant engaged others to do the work. It was a year later that the Council issued a Certificate of Final Inspection and a Certificate of Completion for the building work the subject of the permit. The house was sold in August 2007.
There are other relevant facts which will be considered as they arise in the context of the grounds of appeal.
The proceedings before the magistrate
The hearing occupied approximately six days. The first respondent was represented at the hearing, while the appellant did not have legal representation. She had been represented until shortly before the hearing commenced. The appellant's case consisted of evidence from witnesses: the appellant, Mr Moore, Neil Darvall, quantity surveyor, Judith Partridge, Manager of the Master Builders Association of Tasmania Inc, the appellant's husband, Glynn Williams, farmer and legal practitioner, Dale Wesley, the assistant building surveyor and building inspector with the Central Coast Council, and the investigator appointed by the Building Appeal Board of Tasmania ("the Appeal Board"), Peter Pereyra.
The respondents' case consisted of evidence from witnesses: the first respondent, Dr Wayne Griffioen, geotechnical engineer, Allan Chester, geologist, Chad Freeman, quantity surveyor, Gordan Angilley, engineer, and the same Judith Partridge. The appellant and counsel for the respondent presented detailed closing addresses.
The learned magistrate delivered comprehensive written reasons for his determination. Largely, he found the appellant's claim was not substantiated. He found in her favour as to a breach of contract in one small aspect of the claim regarding defective work, awarding a sum of $150 for replacement of timber plates, having found that treated wood should have been used. He found a breach of contract in that the first respondent did not give Mr Moore the opportunity to inspect the foundation material before concrete was poured for the footings on the northern wall. For this aspect of the claim he allowed investigation costs of $2,000. The appellant had claimed the substantial amount of $9,494 for this particular of breach, claiming the cost of certain bracing of footings known as screw piles. The amount awarded for the claim was $2,150; interest was allowed at 10% to the date of judgment and the total was $2,258.56. In relation to the counterclaim, the learned magistrate concluded that there was no reason why the respondents should not be entitled to judgment for the amount of the outstanding invoices, and allowed the amount claimed in full. Interest was awarded at the same rate to the date of judgment, the total amount awarded being $40,238.86.
The appellant appeals the decision in relation to these proceedings regarding the claim. Two grounds of appeal concern rulings made by the learned magistrate during the course of the trial, grounds 1 and 6. The remaining grounds 2, 3 and 5, ground 4 having been abandoned, concern determinations made by the magistrate with respect to aspects of the claim involving construction of the carport and the installation of screw piles. The grounds concerned with rulings during the trial will be considered first.
Ground 1
"1Erred in law in holding that the Building Appeal Board decision was irrelevant to the Court's decision and consequently refused its admission into evidence."
The appellant contends that a decision made by the Appeal Board on 15 December 2006 was relevant to the proceedings and should have been admitted as it raised the doctrine of issue estoppel. It is argued that the Appeal Board had decided some of the same questions as arose in the proceedings before the learned magistrate and involved the same parties.
The decision of the Appeal Board was not admitted in evidence, but I have been provided with it for the purpose of considering this ground of appeal. It is a decision of the Chairman of the Appeal Board, Mr P Toomey. It concerned an appeal by the appellant with respect to a complaint she made against the first respondent under the Building Act 2000. The Appeal Board determined, pursuant to the same Act, s40(2)(a), that the respondent was guilty of unsatisfactory professional conduct. The Appeal Board concluded that the conduct was not sufficiently serious as to constitute professional misconduct. The Appeal Board concurred with the investigator's recommendations. The investigator, Mr Pereyra, in his report, stated that the respondent had demonstrated unsatisfactory professional conduct which fell short of a reasonable standard of competence, diligence and integrity, had wilfully disregarded relevant and appropriate matters, and had failed to comply with the Building Act. The report provided instances of non-compliance with the Building Regulations 2004 and the Housing Indemnity Act 1992. There are many instances. Relevantly, the investigator's report provided:
"The respondent failed to comply with section 7 of the Housing Indemnity Act 1992 in that he carried out building work under a building work contract and did not perform that work in a proper and skilled manner and in accordance with the plans and specifications agreed to by the parties; did not use all materials that were good and suitable for the purpose; and did not ensure that the building work was performed in accordance with the requirements of this or any other Act."
Although the ground of appeal was expressed in broad terms, the argument about issue estoppel was confined to one aspect of the claim regarding the balustrade, which was mentioned specifically in the decision of the Appeal Board and the decision of the learned magistrate, and which the magistrate decided against the appellant.
The statement of claim asserted that the balustrade was not constructed in accordance with the Building Code or in a workmanlike manner. The Appeal Board made specific mention of the work done with respect to the balustrade as a particular of the finding set out above at [13]:
"Between 12 August and 5 October 2005 the respondent constructed a balustrade to the deck area and that balustrade was not of a robust construction that would meet the requirements of Part 3.9.2 of Volume 2 of the Building Code of Australia".
It is argued that this is a case where the principles of estoppel could have been invoked, and if they had been, they would have precluded the respondents from denying allegations made so that the learned magistrate was required to determine this aspect of the claim in the appellant's favour. On the pleadings as they were, issue estoppel did not fall for consideration. The appellant argues that she should have been given assistance by the magistrate and informed that her pleadings could have been amended. On this basis it is argued that if issue estoppel had been pleaded, the decision of the Appeal Board would have been admissible. The error asserted is in the failure to admit the decision. Whether or not there is error turns on whether issue estoppel would have applied if pleaded, and the argument also raises the question of assistance to an unrepresented litigant.
The ground of appeal asserts error in that the learned magistrate made a ruling refusing to admit the decision of the Appeal Board into evidence. The first matter that falls naturally for consideration is the correctness of the ruling on the pleadings as they were. It should be mentioned at the outset that at the hearing the appellant called Peter Pereyra, and he gave evidence as part of her case. Consequently, there could be no concern that the ruling in question deprived the appellant of adducing evidence of the observations Mr Pereyra had made during the course of his investigations.
When the appellant sought to tender Mr Pereyra's investigation report and recommendations to the Appeal Board, this was objected to. The learned magistrate had an exchange with the appellant regarding relevance, stating:
"HIS HONOUR: Well, I couldn't see, Mrs Williams, how Mr Pererra's [sic] investigations – or the conclusions that he draws as a result of his investigations, could possibly be relevant to the issues that I have to determine because I have to make my own conclusions based on the evidence before me, don't I?"
After an exchange about the transcript of the interview with Mr Jack, not relevant to this ground, the learned magistrate ruled against the appellant:
"HIS HONOUR: And so without hearing from Mr Ayliffe about this, I couldn't – I could not see that I could be persuaded, unless you raise something that I'm not currently aware of, that Mr Pererra's [sic] conclusions could be relevant to the issues in the case that I have to determine."
Later, when the first respondent gave evidence, the appellant cross-examined and asked him whether he had ever been asked to retrain as a builder. Counsel for the respondents objected on the ground of relevance. There was then an exchange and the appellant made it clear that she wished to cross-examine about the Appeal Board's decision. The learned magistrate ruled against her, and stated as follows:
"HIS HONOUR: I'm against you about that, Mrs Williams, I'm not going to allow cross-examination or evidence about the decision of the Building Appeal Board, in my view it's irrelevant and inadmissible."
The learned magistrate's ruling that the Appeal Board's decision is irrelevant to the issues is plainly correct. Relevance is determined by reference to the issues in the particular case, and the issues are defined by the pleadings. The appellant did not plead issue estoppel and thus the application of the doctrine did not arise before the learned magistrate (see r44, Magistrates Court (Civil Division) Rules 1998; r251, Supreme Court Rules 2000).
Acknowledging that the pleadings did not raise issue estoppel, it was argued on appeal that it would have been proper in the circumstances of this case, given that the appellant was unrepresented, for the court to have indicated that in order for her to rely upon the decision she would need to apply to amend her statement of claim. The grievance which was articulated in submissions is that the learned magistrate did not point out to the appellant that she could apply to amend. Arguably, this grievance falls outside the ground of appeal. The respondent did not take the point, and I will consider the merits of the argument.
It is well established that for the doctrine of estoppel to apply in a second set of proceedings there are three requirements:
"… (1) that the same question has been decided; (2) that the judicial decision which is said to create the estoppel was final; and, (3) that the parties to the judicial decision or their privies were the same persons as the parties to the proceedings in which the estoppel is raised or their privies." Carl Zeiss Stiftung v Rayner & Keeler Ltd [No 2] [1967] 1 AC 853 at 935, referred to with approval by Gleeson CJ, McHugh, Gummow, Kirby, Hayne, Callinan and Heydon JJ in Kuligowski v Metrobus (2004) 220 CLR 363 at 373.
In Kuligowski v Metrobus (above) consideration was given to what was meant by the "same question". The judgment of the court at [40] referred to Ramsay v Pigram (1968) 118 CLR 271, at 276, and the judgment of Barwick CJ described as encapsulating what was involved in that requirement:
"Long standing authorities, in my opinion, warrant the statement that, as a mechanism in the process of accumulating material for the determination of issues in a proceeding between parties, an estoppel is available to prevent the assertion in those proceedings of a matter of fact or of law in a sense contrary to that in which that precise matter has already been necessarily and directly decided by a competent tribunal in resolving rights or obligations between the same parties in the same respective interests or capacities, or between a privy of each, or between one of them and a privy of the other in each instance in the same interest or capacity. The issue thus determined, as distinct from the cause of action in relation to which it arose, must have been identical in each case."
If the requirements of issue estoppel were satisfied, it would be a complete answer to the question of liability in relation to the balustrade against the first respondent. The question arises as to the application of the requirements. Were the parties to the civil proceedings the same as in the proceedings before the Appeal Board, and was the same question decided?
In the decision of the Appeal Board, the parties are described as Mrs Williams, the appellant, the Director of Building Control, the first respondent, and Mr Jack, the second respondent. Mrs Jack was not a party, so if the requirements of issue estoppel applied at all, it could not be an answer to the claim against her.
As for the application of the doctrine with respect to the claim brought against the first respondent, Mr Jack, it is not enough that he and the appellant are named parties to the proceedings before the Appeal Board, and that they have an interest in those proceedings. In the words of Barwick CJ, above, they must be parties "in the same respective interests or capacities". The court proceedings are different from the appeal in fundamental respects, giving rise to a significant difference in the interests of the parties and their capacities. I make the following general observations about distinguishing aspects of the two sets of proceedings, and some observations specific to the particular proceedings as well. The nature of the proceedings under the Building Act was a disciplinary investigation (ss35, 40, 43), not litigation between the parties. The decision was made, and, presumably, usually is made merely on the basis of information garnered during an investigation (s43). In the course of the investigation, the respondent was informed of the substance of the allegations, and was afforded an opportunity to respond (s33). The investigator here made a recommendation that the complaint, and evidence gathered in investigating that complaint, justified a hearing for allegations against the respondent. But significantly, on the appeal by the appellant, there was no hearing, no evidence, no calling of witnesses, and no opportunity to cross-examine and present evidence (ss42, 43, 44(1)(c)). The Appeal Board concurred with the recommendations of the investigator, Mr Pereyra, and determined that the building practitioner was guilty of unsatisfactory professional conduct. It is unclear whether each of the many allegations was found established on the information before the Appeal Board, or whether the Appeal Board found that in a global sense the nature of the allegations supported the finding, without making findings that all conduct was established.
The outcomes of a decision of the Appeal Board under the Building Act are in the nature of disciplinary orders ranging from a caution, to a cancellation of a builder's accreditation, depending on the nature of the finding: ss43(1), 40(3) or (4). A builder may be ordered to carry out the work at his or her expense. There is no entitlement to damages. A complainant asserting a breach of professional standards is not in the same interest or capacity as a claimant bringing civil proceedings. The nature of the capacity of a complainant is as the instigator of the proceedings. The appellant's role in the proceedings would have been simply as a source of information for the Appeal Board, and the potential recipient of the benefit of an order that the builder carry out the work at his own expense, if such an order was made. Otherwise, she had no interest in the proceedings. She had no control over the information gathered and the issues to be determined, beyond the making of a complaint. A builder responding to such an allegation has an interest which is not the same as his interest and capacity as a defendant to the civil proceedings subject to appeal. Here, the first respondent had, of course, a close interest in the outcome of the proceedings as his livelihood and professional standing were at stake, but little control over the information considered and the issues determined. As I have said, the appeal was not conducted between the appellant and the first respondent as litigants. The outcome of the different proceedings is vastly different. I conclude that the first respondent and the appellant are not parties with the same respective interests and capacities.
Further, the issue which arose in relation to the balustrade is quite different to that here. The Appeal Board endorsed Mr Pereyra's report. The report stated: "I recommend that the complaint made by the appellant, and supported by the evidence gathered in investigating that complaint, justifies a hearing before the Building Appeal Board for allegations against the respondent". The allegation set out above at par[13] is one of a number of failings; as I have noted, there are a number of particulars, and the particular with regard to the balustrade is only one of those.
As I have said the language of the report does not make it clear whether a particular finding was made in this regard, or whether findings were made merely in a global sense.
The statement of claim in par23 provided that:
"The Plaintiff's loss, damage and expense have been caused by breaches of the first agreement and/or the further agreement and/or the negligence and/or statutory duty of the First Named Defendant, his servants or agents.
PARTICULARS
b Failed to replace the existing deck and provide a proper balustrade and/or balcony rail of sufficient strength and stability to comply with the Building Code and to undertake that work in a proper and workmanlike manner;
…
x Failed to complete the balustrade on the deck to a safe standard as is required under the Building Code of Australia; …".
These allegations were denied. The learned magistrate found that there was a difficulty with this aspect of the claim. There was evidence that the appellant engaged T & G Glass to build the balustrade, and the contention that the contract was varied to exclude the requirement that the first respondent construct the balustrade, was not refuted. It was concluded that the evidence would not justify a finding that the first respondent is vicariously liable for the negligence of T & G Glass, and the appellant had not established that the first respondent had breached a varied contract. By comparison, in the disciplinary proceedings with a focus on professional discipline, the question of whether the balustrade was constructed by an employee of the builder, or a sub-contractor, may not have had significance. This issue arose on the pleadings but it is far from clear that it was determined in the disciplinary proceedings. For the doctrine of issue estoppel to apply there must be certainty that the issues have been determined in the first proceedings: Kugilowski at [37].
It is patently clear that the requirements of issue estoppel were not satisfied here. In light of the conclusion I have reached that issue estoppel was not applicable, there is no merit in the argument advanced that the magistrate should have suggested an amendment to the pleadings, and ground 1 must fail.
Even if issue estoppel had been applicable, there would arise a question of whether in the circumstances of the particular case, the magistrate was obliged to inform the appellant that she could amend her pleadings to plead issue estoppel. Any such obligation would arise by reason of ensuring an unrepresented litigant had a fair and just trial. A trial judge's responsibility in this regard depends on the nature of the case and the individual litigant. The circumstances of this particular case did not suggest that this was necessary.
For the role of the judge in civil proceedings involving an unrepresented litigant see the discussion in Rajski v Scitec Corporation Pty Ltd (CA (NSW), 16 June 1986, unreported) per Samuels J at 14:
"In my view, the advice and assistance which a litigant in person ought to receive from the court should be limited to that which is necessary to diminish, so far as this is possible, the disadvantage which he or she will ordinarily suffer when faced by a lawyer, and to prevent destruction from the traps which our adversary procedure offers to the unwary and untutored. But the court should be astute to see that it does not extend its auxiliary role so as to confer upon a litigant in person a positive advantage over the represented opponent ... At all events, the absence of legal representation on one side ought not to induce a court to deprive the other side of one jot of its lawful entitlement ... An unrepresented party is as much subject to the rules as any other litigant. The court must be patient in explaining them and may be lenient in the standard of compliance which it exacts. But it must see that the rules are obeyed, subject to any proper exceptions. To do otherwise, or to regard a litigant in person as enjoying a privileged status, would be quite unfair to the represented opponent."
See also Mahoney JA at 27.
Of particular significance in this case is that the appellant had been legally represented from the commencement of proceedings in the Supreme Court until shortly before the trial. Significantly, her statement of claim and reply had been filed on her behalf by her legal practitioner. Her lawyer was a senior practitioner with extensive litigation experience. It would have been appropriate for a magistrate to proceed on the basis that the pleadings had been drafted to the appellant's full advantage and even, that it may have been to her disadvantage to amend them unless there was an obvious deficiency.
There are other relevant circumstances bearing on the question of the magistrate's obligation: the balustrade was just one aspect of the claim concerning poor workmanship; the appellant faced problems in proving assertions she had pleaded; and the claim regarding the balustrade lacked merit and would not have been productive in any event. The learned magistrate found that the evidence failed to establish "what was required to rectify the problem, who did the work and what it cost". There were no invoices in evidence. Indeed, the appellant conceded in these proceedings that if this ground of appeal succeeded it would only result in an award of nominal damages: Luna Park (NSW) Ltd v Tramways Advertising Pty Ltd (1938) 61 CLR 286.
The cost of expanding the issues is a matter that a magistrate must bear in mind. In this case, if the pleadings had been amended, costs would have been incurred by both parties as a consequence, ultimately, to nil advantage for the appellant because issue estoppel would not have had application. Even if it would, the award would have been nominal and the cost of litigating the claim not worthwhile. This ground lacks merit.
Ground 6
"6Erred in law in refusing to admit the transcript prepared by Peter Pererra [sic] into evidence."
The transcript referred to is of an interview that the investigator Peter Pereyra conducted with the respondent during the course of the investigation under the Building Act. It was argued that the transcript ought to have been admitted, as it was relevant and admissible as an exception to the hearsay rule, under s64(3) of the Evidence Act 2001.
This ground of appeal does not point to a particular ruling made by the learned magistrate said to contain error. It is necessary to consider what occurred during the hearing.
The appellant sought to admit the transcript as a business record, pursuant to s69 of the Evidence Act during the evidence-in-chief of Mr Pereyra. The learned magistrate ruled against that submission on the basis that it fell within the exception in s69(3). That ruling has not been challenged on appeal. The learned magistrate made it clear that parts of the interview may be admissible as admissions, in which case he would make a determination of that, as the appellant sought to tender parts of the interview through Mr Pereyra. Further, he made it clear that parts of the interview may be put to the respondent during the course of cross-examination.
The appellant did not seek to prove during her case any of the first respondent's answers in the interview on the basis that they were admissions. However, when the first respondent gave evidence, she took the opportunity to cross-examine him about the answers he gave during the interview. In fact, extensive passages of the interview were put to him. Mostly, he agreed with questions about what he had said during the interview and, when asked to do so, he clarified the responses he had given during the interview. There were occasions when the first respondent did not admit the responses which it was suggested he had given during the interview. Subsequently, the appellant did not seek to prove those responses. There was no ruling made in relation to these responses, either confining cross-examination or preventing the appellant from proving them.
It is submitted that the entirety of the interview was admissible. The argument pressed on appeal was that the interview was relevant and admissible as an exception to the hearsay rule under s64(3) of the Evidence Act. That section provides:
"(3) If the person who made the representation has been or is to be called to give evidence, the hearsay rule does not apply to evidence of the representation given by —
(a) that person; or
(b) a person who saw, heard or otherwise perceived the representation being made."
This section was not relied upon by the appellant at the trial and, as I have said, she did not seek to prove the balance of the responses in the interview not already in evidence. The submissions on appeal did not attend to the detail of how this section might apply. Ordinarily, the section would be relied upon to admit a representation made by a witness who made that representation. However, the appellant's witness, Mr Pereyra, was not the person who made the representation; he was the questioner. I do not have the benefit of submissions as to whether the section is applicable to the scenario that arose on the hearing. I note that the section has an extended application and applies to admit the evidence of a person who heard the representation. Arguably, the evidence of the first respondent's representations may, if the section applies, be given by Mr Pererya who heard the representation being made. However, there would usually not be resort to s64(3) in this scenario because of the obvious pathway to admitting statements made by an opposing party, before cross-examination of that party, as admissions contrary to interest, s81.
The learned magistrate did not rule on this argument. This is an argument of admissibility raised for the first time on appeal, not raised before the magistrate, and where the appellant took a different path at the hearing of cross-examining the respondent about his answers during the interview. There is no ruling under attack. Error is not shown by pointing to a possible pathway of admitting evidence which was not argued at hearing and when an alternative pathway of admitting the evidence was pursued. Also, it has not been demonstrated that the few interview responses drawn to my attention which the respondent did not admit during cross-examination were of any particular significance in terms of the magistrate's consideration of the issues, including the issue of the first respondent's credibility. For these reasons, this ground of appeal is misconceived.
Grounds 2 and 3: the carport
Grounds 2 and 3 both relate to the carport, and it is convenient to deal with them together.
"2Erred in fact and law in finding that the carport construction was not part of the contract between the respondent and the applicant and accordingly that the Building Code of Australia did not apply to the carport construction.
3Erred in fact and law in failing to be satisfied that there was non-compliance with the Building Code of Australia in respect to the construction of the carport."
The respondent was engaged to demolish an existing deck and replace it with a new deck with supporting walls and columns. The underneath of the existing deck and the replaced deck was asserted by the appellant to be used as a carport. The appellant's case was that, given the carport was reconstructed, the work needed to comply with a height clearance stipulated in the Building Code of Australia relating to carports. She claimed costs of rectification of $12,334.
This aspect of the claim failed on multiple bases. In particular, the learned magistrate was not satisfied that carport works were part of the contract, and was not satisfied that there had been non-compliance with the Building Code. The magistrate found or observed the following on this aspect of the claim:
· While the building work had to be carried out in accordance with the Building Code, that requirement was in very general terms. The duty of a builder under Pt3 of the Building Act is primarily to comply with any permit. The building surveyor was to ensure compliance with the Act.
· On the evidence he was not satisfied that non-compliance with the Building Code was proved.
· Even if there had been non-compliance with the Building Code, he was not satisfied that it was part of the contract to undertake the work that would be necessary to comply with the Building Code in this respect. The respondent was engaged to perform the building work in accordance with the plans prepared by Mr Moore. The plans were for a structural retaining wall and footings for the carport area. There is no evidence at all that the respondent did not perform the work in accordance with the plans.
· The only way to increase the carport height clearance was to excavate earth from the floor of the carport. This would have involved substantial work that the respondent was not engaged to do. No instruction or plan was given or prepared to undertake that work.
· There was no requirement for rectification with respect to the clearance; the Certificate of Final Inspection and Certificate of Completion issued by the council both certified compliance with the Building Code, the Building Act and the Building Permit.
· The costs of rectification claimed by the appellant were not incurred. There was no evidence justifying a finding that the price obtained for the house was affected by the claimed defects. Furthermore, rectification at the cost claimed was unnecessary and unreasonable, and would have secured a profit for the appellant for what was a technical breach of contract, if a breach was established.
The submission for the appellant pointed to evidence that the clearance was less than 2.1 metres. It was said to be common ground with reliance on the cross-examination of the first respondent. I proceed on the basis that the clearance was less than 2.1 metres, noting that the Council building surveyor's list of matters requiring attention referred to "height under joists 1920mm (carport)".
A fatal blow to the success of this aspect of the claim is that the learned magistrate was entitled to conclude, as he did, that even if a breach had been proved, given the lack of evidence of any loss incurred by the appellant, it would have been unreasonable to make an award. This conclusion was not impugned, and upholding this ground of appeal would not result in this part of the claim being upheld.
The appellant has not demonstrated error in the learned magistrate's conclusion that it was not part of the contract between the parties that the respondent was to undertake work with respect to the carport so that it complied with a ceiling height of 2.1 metres. The learned magistrate's conclusion was open, noting the evidence referred to: the respondent was required to comply with the plans prepared by the appellant's engineer, Mr Moore; no provision was made for altering the height of the carport ceiling in the plans; and the issue of ceiling height was not raised by Mr Moore after the works were complete as a matter requiring rectification. On this basis alone, ground 2 must fail and ground 3 cannot be effective to undermine the conclusion reached by the learned magistrate.
I also add that it is far from clear that the Building Code actually applied so that the clearance had to be 2.1 metres. My attention was drawn to an extract of the Building Code, F3.1 and "Deemed-to Satisfy Provisions" a requirement that the ceiling height must be not less than 2.1m for a "car parking area" in any building. However, the application of these provisions is not universal: see F3.0. There is evidence suggesting the work undertaken by the first respondent was not in breach of the Building Code. For example, the evidence of the certificate of completion issued by the Council certifying that the works undertaken by the first respondent complied with the Building Code. It is not necessary for me to determine whether the magistrate was correct, and whether the provisions of the Building Code applied. Grounds 2 and 3 also fail.
Ground 5: screw piles
"5Erred in law in that having found that the screw pile works were installed by the applicant in reliance on the reasonably held opinion of an experienced engineer, that it was also necessary that the screw pile works were required as a result of inadequate bearing capacity of the founding material."
Screw piles are a form of bracing that is applied to footings to prevent movement. On the recommendation of Mr Moore, these were installed as rectification, after the work had been undertaken by the first respondent.
As a term of the contract, the first respondent was required to have the appellant's engineer, Mr Moore, inspect the excavated foundation, being the founding material, before the concrete foundations were poured. The first respondent did not do that, and he breached the contract in this regard. There were structural problems evident some months later involving the level of the flooring and the like. Mr Moore reached the view that the footings were not properly founded and settlement was occurring. He considered that underpinning was required as a solution to these problems, and the best way to do that was by the placement of screw piles under the existing footing, to counteract and prevent any vertical movement. The cost to the appellant was $9,494.
The primary argument before the learned magistrate was that the founding material was inadequate and was the cause of the structural problems. There was evidence from the first respondent's engineers that the founding material was more than adequate, and that some simple testing of the soil, and the load-bearing capacity of the material would have revealed this to be so. Mr Moore did not undertake those simple tests.
The learned magistrate determined that the first respondent had breached the contract, as I have mentioned. Specifically, the magistrate found that the first respondent failed to give Mr Moore the opportunity to inspect the excavated foundation, the founding material, before the concrete was poured for the footing of the northern wall. The first respondent was not to have proceeded before he had Mr Moore's approval to do so. However, the magistrate was not satisfied that the structural problems observed by Mr Moore were caused by inadequate bearing capacity of the founding material of the northern footing. He determined that the material was in fact adequate and not the cause of the structural problems. That determination is not impugned. The learned magistrate considered it more likely that the structural problem was caused by differential movement between the new footing and the old footing, although it was unnecessary for him to decide that. The learned magistrate's conclusion that the remedial works of screw piles was unnecessary was also not impugned.
The magistrate went on to consider whether the breach was causative of the cost of the appellant undertaking the installation of screw piles in particular; whether it was an expense caused by the breach because, without it, the appellant could not obtain certification and sell her house. The facts as found by the magistrate were that Mr Moore was not prepared to certify the footings in the northern wall because he had not seen the founding material prior to the concrete pour. The Council issued a Building Inspection Direction which required the design engineer to confirm the founding depth of the footings. The appellant was intending to sell her house and outstanding Council directions may have meant that she would not be able to obtain a Certificate of Final Inspection under the Building Act. Outstanding directions and any non-compliance with the permit may have meant that she would not have obtained that certificate.
There was no evidence that the founding depth of the footings was insufficient. Mr Moore's concern was about the bearing capacity of the founding material, at whatever depth. Observations Mr Moore made of the founding material during the course of installation of the screw piles, supporting the appellant's case that they were inadequate, were rejected, and the observations of the first respondent's experts preferred.
The learned magistrate concluded that the cost of installing the screw piles was attributable to Mr Moore's decision to pursue that remedy, rather than to the first respondent's decision to pour without inspection. The claim with respect to the screw piles was not allowed. The learned magistrate accepted though that the first respondent's conduct in proceeding without inspection caused other loss. He concluded that it would have been reasonable for Mr Moore to undertake the type of investigation and testing undertaken by the first respondent's experts to determine whether the cause of any structural problem was the bearing capacity of the founding material. He said: "That is not what happened, but it is reasonable in my view to make an award to allow for some of Mr Moore's time in dealing with the issue". The sum of $2,000 was allowed for that purpose.
It was suggested in submissions on appeal that the remedial work of the screw piles was necessary for certification. That does not accord with the findings of the magistrate and unchallenged evidence. The Council's direction was limited to confirmation of the depth of the footings. That issue did not coincide with Mr Moore's concern, which was that the bearing capacity of the founding material was inadequate. It would be reasonable to regard the direction, and the fact that the appellant intended to sell the house, as relevant in a general sense, as part of the circumstances. As a consequence, it may have meant that there was some time pressure to address the structural problems.
That leaves the main argument on appeal. It was argued that the decision made by Mr Moore to require the installation of screw piles was caused by the failure to provide him with an opportunity to inspect prior to the pouring of the concrete. The contentions were that it was foreseeable that Mr Moore would respond cautiously, given he had not had the opportunity to inspect, and that he would require the installation of screw piles. Further, it was argued that his decision in this regard was not a novus actus interveniens, and the costs that flowed from it incurred by the appellant are attributable to the first respondent's breach of contract by not allowing an opportunity to inspect. Did the learned magistrate err in not making this finding?
The question of causation is a factual issue to be resolved by considering whether the first respondent's breach was so connected with the appellant's loss or damage that, "as a matter of ordinary common sense and experience it should be regarded as a cause of it": March v E & MH Stramare Pty Ltd (1991) 171 CLR 506. Responsibility does not extend to every loss suffered by a person that is in some way associated with a breach of contract. The question of whether a wrongful act or breach of contract is a cause is concerned with ascribing legal responsibility for conduct. The "but for" test is useful and, as a negative criterion of causation, has an important role to play. However, as a definitive test it can yield results contrary to common sense and experience which must be tempered by the "making of value judgments and the infusion of policy considerations": March v Stramare per Mason CJ at 508, 515 – 517; see also Deane J at 522 - 523, 524, Gaudron J at 525. The "but for" test may be deficient, too, in cases in which intervening action by another, or novus actus interveniens is said to sever the chain of causation which would otherwise have resulted from an earlier wrongful act: per Mason CJ at 517.
The following key facts, as found by the magistrate and not assailed by this appeal, are relevant in considering Mr Moore's decision to install the screw piles:
• Mr Moore's concern, which led to the screw piles, related to the bearing capacity of the founding material. His concern was that the footings did not have a safe bearing capacity of 100kPa.
• In fact, the founding material under the footing was satisfactory and had an allowable bearing capacity of at least 100kPa. The learned magistrate was not satisfied that inadequate founding material was the reason for the structural problem.
• In fact, the bearing pressure required for the northern wall was only 10 - 20kPa.
• Simple tests involving penetrometer readings and the digging of test holes to approximately 0.6m below ground level were available. Such tests would have revealed the adequacy of the material and that the work done was satisfactory.
• These tests could have been undertaken by Mr Moore at any time, including after the opportunity for inspection had passed.
Thus, it was open to the learned magistrate to conclude: Mr Moore's decision to require the installation of screw piles was based on an opinion about the cause of the structural problems which was incorrect; his opinion was due to his assumption that the founding material was inadequate; there was a least one other feasible explanation for the problems; and, testing could readily have been undertaken by him and would have determined the cause.
Undoubtedly, there is a sequential association between the breach and the remedial action. The breach set the scene or is an antecedent condition for the action taken by Mr Moore.If it was not for the first respondent's failure to afford the opportunity to Mr Moore to inspect the founding material, he probably would not have made the assumption he made about the cause of the structural problems. However, that does not resolve the matter. Essentially, Mr Moore required remedial works for a structural problem not caused by the first respondent, and when Mr Moore's decision to incur expense was based on an error about the cause of the problem. Additionally, the reason he made that error was because he made an assumption which was not valid, and the means of checking his assumption were available to him. In these circumstances I cannot see that the first respondent's breach should properly be regarded as a cause of the installation of the screw piles. As a matter of common sense, the cause of the expense incurred was Mr Moore's flawed decision-making, rather than the breach.
It is not necessary for me to decide whether the response of Mr Moore in requiring the screw piles to be installed is properly characterised as breaking the chain of events set in train by the breach, or more simply, whether their installation lacks causal connection with the breach.
Having regard to the findings of the learned magistrate that were not challenged, it was open to him to reach the conclusion that the failure to afford the opportunity to inspect was not a cause of the installation of the screw piles. There is no error in the approach taken by the learned magistrate, and this ground fails.
The grounds of appeal fail in their entirety. The appeal will be dismissed.
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