Brewster t/a PRD Nationwide v de Abaitua [2010] QCATA 25

CITATION: Brewster t/a PRD Nationwide v de Abaitua [2010] QCATA 25 PARTIES: Mr Greg Brewster t/a PRD Nationwide (Applicant) v Paul de Abaitua (Respondent) APPLICATION NUMBER: APL060-10 MATTER TYPE: Appeals HEARING DATE: On the papers HEARD AT: Brisbane DECISION OF: President DELIVERED ON: 18 June 2010 DELIVERED AT: Brisbane ORDERS MADE: 1. Stay the execution of the decision by default entered on 12 April 2010 until further order; 2. Applicant and respondent to file and serve any further submissions addressing the circumstances in which the decision by default was entered, and the application for leave to appeal and appeal, by 14 July 2010. CATCHWORDS : PRACTICE AND PROCEDURE – MINOR CIVIL DISPUTE – DEBT – APPEAL – where default judgment entered – where appeal lodged – whether judgment irregularly entered – whether entered for debt or liquidated demand – whether judgment should be set aside – whether judgment should be stayed Queensland Civil and Administrative Tribunal Act 2009, ss 50, 51, 58 and 61 Rothenberger Australia Pty Ltd v Poulsen (2003) 58 NSWLR 288, applied -- 1 of 4 -- 2 APPEARANCES and REPRESENTATION (if any): APPLICANT : RESPONDENT: REASONS FOR DECISION [1] Mr Brewster is a real estate agent at Runaway Bay. On 9 March 2010 he was served with an application in Minor Civil Dispute – Minor Debt no Q 698/10 issued in Southport by Mr de Abaitua. [2] Mr Brewster did not file a response in the application or pay Mr de Abaitua the sum he sought, said to be money owing for an alleged breach of a contract relating to a failure to settle a property transaction, and damages to the property. [3] Mr de Abaitua applied for, and was granted, a judgment by default on 12 April 2010 by an authorised QCAT officer. Mr Brewster has applied for leave to appeal that decision but his documents reveal some confusion about the relief he seeks and, in particular, whether his application is in truth an appeal or, in fact, an application to set aside the default judgment (or, whether that is what is should be). [4] In his application Mr Brewster sought leave to appeal the default judgment, that the judgment be stayed and set aside, and the proceeding re-opened. Although he appears to have lawyers assisting or representing him, he has not, however, filed an application to stay the decision or an application to have it re-opened – both processes open under the QCAT Act and Rules, and for which forms are provided. [5] Section 50 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act) permits QCAT to make a decision by default, but only if the applicant seeks to recover a debt or liquidated demand of money. Section 51 gives the tribunal the discretion to set aside or amend a decision by default on terms it considers appropriate, including terms about costs and giving of security. [6] Under the s 58 QCAT has the power to make an interim order (if necessary, on its own initiative) to require or permit something to be done to secure the effectiveness of the exercise of the tribunal’s jurisdiction if it is in the interests of justice. Under s 61, the tribunal may also waive compliance with procedural requirements unless it would cause prejudice or detriment to a party to the proceeding that cannot be remedied by an appropriate order for costs or damages. [7] Although Mr Brewster has applied for leave to appeal, the true nature of the relief he seeks appears to be to set aside the default judgment. -- 2 of 4 -- 3 [8] The grounds for setting aside a judgment are the same for decisions allegedly entered regularly or irregularly and include whether there has been a satisfactory explanation of the failure to defend; whether any delay precludes the relief sought; and, whether the defendant has a prima facie defence on the merits 1 . [9] By a direction of this Tribunal it was ordered that Mr Brewster’s application for leave be determined by written submissions, according to a timetable. [10] In response, the solicitors assisting Mr Brewster advised under cover of letter dated 11 May 2010 that he wishes only to rely on those submissions originally annexed to his application for leave to appeal. Mr de Abaitua responded in turn with his submissions, and a response to Mr Brewster’s application. [11] In his submissions, Mr Brewster’s primary contention is that he had a valid defence to the original application. They include: (i) that through a misconception, he assumed that a solicitor for the Professional Indemnity Insurer of his real estate company responded to the application on his behalf; (ii) that judgment was not actually for a liquidated debt but rather for compensation for alleged breach of contract and property damage that has not been particularised in the claim; (iii) that although he is the Principal of a PRD Nationwide office and although he acted on behalf of Mr Abaitau for sale of the property, that in truth he was not actually his agent; and (iv) that the claim should be against Fanbridge Pty Ltd as it trades as PRD Nationwide. [12] For reasons which follow, Mr Brewster’s second contention is sufficient to, at least, warrant a stay of the default decision; and therefore the first, third and fourth do not need to be addressed in this decision at this time. [13] In his original application, Mr de Abaitau claims $6,452.14 as damages for breach of contract on the grounds that, according to the original application, Mr Brewster failed to settle the purchase of the property by the specified date (30 September 2009); that he failed to determine the title would not be available on settlement (which did not occur until December 2009); and that there was damage to the property and missing items once settlement did take place. [14] Although Mr de Abaitau filed an affidavit in support of his application for a default decision, there is no indication in the file to suggest that the sum he claims is truly a liquidated debt. As Barrett J explained in Rothenberger Australia Pty Ltd v Poulsen (2003) 58 NSWLR 288 at 297-298: The relevant distinction, in my view, is that between agreed compensation calculated and quantified in a way specified in or ascertainable from the contract itself and damages to be assessed according to the ordinary principles for determining damages for breach of contract. The distinction is illustrated by 1 See Pullen v Deputy Commissioner of Taxation [2007] QDC 055; Deputy Commissioner of Taxation v Johnstone [2006] QSC 61; and National Mutual Life Association of Australasia Ltd v Oasis Developments Pty Ltd [1983] 2 Qd R 441 -- 3 of 4 -- 4 cases in which the purchaser under a contract for the sale of land defaults and the vendor, as a result, may sue for damages for breach of contract in the ordinary way or, if he or she prefers, take advantage of a provision of the contract permitting the vendor to resell and to recover from the purchaser any deficiency on resale together with expenses of resale. A sum recovered by a vendor who pursues the latter course is properly regarded as involving the recovery of a “liquidated sum” (see Tiplady v Gold Coast Carlton Pty Ltd (1984) 8 FCR 438), while the damages recovered by a vendor who takes the former course are “unliquidated damages” or, in the words of Young J in Jampco Pty Ltd v Cameron (No 2) (1985) 3 NSWLR 391 at 393, “breach of contract damages”. The difference between the two is that “liquidated damages” are recoverable in satisfaction of a right of recovery created by the contract itself and accruing by reason of breach, while “unliquidated damages” are compensation as assessed by the court for loss occasioned by breach. I certainly agree with Mr Robb that the choice of a particular form of originating process can have no bearing on the nature of the award made to a successful plaintiff. Even if a plaintiff who frames as a liquidated demand a claim which in truth is not of that kind manages to obtain judgment by default for the whole amount claimed, the judgment will be regarded as irregularly obtained and will be set aside: Gemini Property Investments Pty Ltd v Woodards Investments Pty Ltd [2000] SASC 210. [15] In the absence of any apparent evidence, either in Mr de Abaitua’s claim documents or his affidavit in support of his application for a decision by default, that his claim arose as a debt or liquidated demand for money, the QCAT officer who entered the decision by default may have acted in error. [16] In the circumstances the proper course available – for the reasons stated earlier, with reference to ss 58 and 61 of the QCAT Act – is to stay the execution of the decision by default and allow the parties to address the issues raised in these reasons with written submissions as to whether or not the decision by default should be set aside, and to address the procedural confusion Mr Brewster has created, including of course, his application for leave to appeal, and appeal. -- 4 of 4 --