Duyvelshoff v R M & S M Turnbull P/L & Anor [2004] QDC 425

DISTRICT COURT OF QUEENSLAND CITATION: Duyvelshoff v. RM & SM TURNBULL PTY LTD & Anor [2004] QDC 425 PARTIES: GERALD DUYVELSHOFF (Appellant) v. RM & SM TURNBULL PTY LTD Trading as Turnbull Earthmoving (First Respondent) And SHERLOCK PLANT HIRE PTY LTD (Second Respondent) FILE NO/S: 13/2003 DIVISION: Civil PROCEEDING: Appeal ORIGINATING COURT: District Court Ipswich DELIVERED ON: 20/10/04 DELIVERED AT: Ipswich HEARING DATE: 17/10/03 JUDGE: Richards DCJ ORDER: Appeal dismissed. The appellant is ordered to pay the respondent’s costs of and incidental to the appeal to be assessed unless otherwise agreed. CATCHWORDS: Small Claims Tribunal – application of s17(1) of the Act to subsequent proceedings in the magistrates court COUNSEL: Mr T Ryan for the applicant Mr A West for the respondents SOLICITORS: McNamara & Associates for the applicant Walker Pender for the respondents [1] Gerald Duyvelshoff is the owner of a property situated at Lot 71 Coach Lane, Ironbark Ridge. In June 2002 he approached Arthur Sherlock who was a principle of Sherlock Plant Hire Pty Ltd in relation to some earthworks that he wanted performed on the property. Sherlock estimated the cost of the work to be about -- 1 of 13 -- 2 $5,000, however, indicated that he could not do the work because the job was too large for the type of machinery that he operated. He passed the work on to John Turnbull of RM and SM Turnbull Pty Ltd who proceeded to perform earthworks on the property. [2] Duyvelshoff claimed that he was unaware that the work had been turned over to Turnbull until 9 August 2002 when he went to his property and saw earthmoving equipment on the property. He said he had not agreed to Turnbull doing the work. Turnbull claimed that Duyvelshoff was well aware of his involvement because they had “smoko”together on at least 5 occasions and he kept changing his requirements to the extent that he told him that the extra work would cost $6000 plus GST. [3] The work concluded on 10 August 2002 and at that stage Duyvelshoff told Turnbull the work was not satisfactory. There were further earthworks performed on 31 August 2002, however still not to the satisfaction of Duyvelshoff. [4] On 1 September 2002 Duyvelshoff was given an invoice by Turnbull in a sum of $6,600 inclusive of GST. Duyvelshoff demanded an itemised account of the work and he was subsequently given another account for $7,524. [5] Duyvelshoff commenced an action in the Small Claims Tribunal on 10 September 2002, asking for relief from payment of the amount of $7,500. The matter proceeded to hearing on 2 December 2002. On 19 December 2002 the referee handed down a decision giving relief to Duyvelshoff in the amount of $900, thus reducing the invoice to $6,600, that being the original invoice sent to him by Turnbull. -- 2 of 13 -- 3 [6] On 14 January 2003 Turnbull filed a claim in the Magistrates Court seeking payment of that amount. On 26 February 2003 Duyvelshoff defended that claim and filed a counterclaim against Sherlock. [7] On 14 April 2003 Turnbull and Sherlock brought application for summary judgment in the Magistrates Court. A decision granting the application was given on 22 April 2003. It is from that decision that this appeal is brought. The Small Claims Tribunal [8] Mr Duyvelshoff’s claim in the Small Claims Tribunal indicated that he had contracted with Sherlock to do work on the property for the sum of $5,000. He claimed that Turnbull had started the work without his knowledge or authorization. When he saw that Turnbull was working there he gave him certain instructions. [9] He indicated that the reason the work was being done was to make the property more saleable and to increase the value of the property. He said, however, the work that was done actually diminished the value of the property. He indicated that the work was not done to the required standard and that it was not done to his instructions. He claimed the value of the property had been reduced by $20,000 because of the work being done unsatisfactorily. He then listed a series of complaints about the quality of the work and failure to obey instructions during the work. [10] The matter proceeded in the Small Claims Tribunal on 2 December 2002. The parties gave evidence on oath. The referee gave a decision on 19 December 2002 whereupon he went through the evidence that was given by the parties indicating in -- 3 of 13 -- 4 effect that he accepted the evidence of Turnbull and Sherlock. It seems from the decision that Mr Turnbull was accepted by the referee and that he found Mr Duyvelshoff unclear in his instructions. It is clear by inference that he accepted that there was discussion between Turnbull and Duyvelshoff and that there was a contract between the Turnbulls and Duyvelshoff, but that it was flawed in that there was no clear and identifiable instructions. Accordingly he found in favour of Mr Turnbull. [11] The Small Claims Tribunal was established in 1973 to enable the quick and cheap resolution of matters before a court where the amount in dispute is not significant. A small claim means: “(a) a claim – (i) for payment of money of a value not exceeding the prescribed amount; (ii) for relief from payment of money of a value not exceeding the prescribed amount; (iii) for performance of work of a value not exceeding a prescribed amount to rectify a defect in goods supplied or services provided; (iv) for return of goods of a value not exceeding the prescribed amount; (v) for a combination of claims referred to in subparagraphs (i) to (iv) or to any two or more of them where the total value of the combined claim does not exceed the prescribed amount; that in any case arises out of a contract for the supply of goods or the provision of services made between persons who, in relation to those goods or services, are a consumer or a trader on the one hand and a trader on the other; or ….. (c) A claim for payment of money of a value not exceeding the prescribed amount for damage to property caused by or arising out of the use of a vehicle.”1 [12] It is important to note at this stage that it was Mr Duyvelshoff who chose to go to the Small Claims Tribunal rather than to another forum. He was the one who raised 1 S4 Small Claim Tribunals Act 1973 -- 4 of 13 -- 5 the question of whether the bill was due and payable and whether he should get relief from that bill. The claim that was drafted by Mr Duyvelshoff was extensive and it is clear that he was seeking a resolution of a large number of questions in the Tribunal. [13] Having started the claim in the Small Claims Tribunal, s.17 of the Act provides: “Exclusion of other jurisdictions 17(1) Where a claim, being one referred to in s.16, is duly referred to a Small Claims Tribunal the issue in dispute in that claim (whether as shown in the initial claim or as emerging in the course of the hearing of the claim by the Tribunal) shall not be justiciable at any time by a court or by a Tribunal of any other kind save – (a) where the proceeding before that court or tribunal of any other kind was commenced before the claim was duly referred to a Small Claims Tribunal; or (b) where the claim before a Small Claims Tribunal has been withdrawn and has been struck out for want of jurisdiction; or (c) where a Small Claims Tribunal determines that because of the nature or complexity of the issue the claim should not be heard by it.” [14] The issues raised by Mr Duyvelshoff in the Tribunal in relation to the work done by Mr Turnbull were: (a) whether there was a contract between Turnbull and Duyvelshoff as opposed to Duyvelshoff and Sherlock (b) whether the contract was complied with because the work was not done in a proper and workmanlike manner; (c) whether there had been, as a result of the work, a diminution in the value of the property and therefore setoff could be claimed against the cost of the work. [15] It has to be said the claim was not drafted by a lawyer and as such those issues are not set out in the way that they might be in a Statement of Claim, however, it is -- 5 of 13 -- 6 clear enough that those were the matters which Mr Duyvelshoff sought to litigate in the Small Claims Tribunal. [16] Section 18 of the Act provides: “Proceedings of the tribunals final 18(1) Subject to subsection (2), a settlement or an order made by a Small Claims Tribunal shall be final and binding on all parties to the proceeding in which the settlement or order is made and on all persons who under this Act could have become entitled to be joined as a party to the proceeding in which the settlement or order is made, and no appeal shall lie in respect thereof.” [17] The claim was decided in the tribunal, the question is what effect does this have on the claim that was made in the magistrates court. The Civil Claim in the Magistrates Court [18] On 14 January 2003 RM and SM Turnbull Pty Ltd filed in the Magistrates Court a claim for $6,600 being monies due and owing for work and labour done by them for and on behalf of Duyvelshoff together with interest. This was a claim made in accordance with the decision of the Small Claims Tribunal. [19] On 26 February 2003 the defendant then lodged a defence and counterclaim denying that he was in debt because there was no actual agreement between the plaintiff and the defendant to perform the earthworks and claiming that the contract existed between the plaintiff and Sherlock. Alternatively, it was claimed that the express term of any agreement was that the work would be carried out in accordance with his instructions and it was an implied term that he would exercise reasonable skills and care. Duyvelshoff then lodged a counterclaim against Turnbull alleging that he was negligent in performing the earthworks and that loss -- 6 of 13 -- 7 and damage was suffered and alternatively that there was a breach of contract and that Sherlock was liable to compensate the appellant for damages arising out of breach of contract because the contract was in fact between Sherlock and Duyvelshoff. He claimed for diminution of the value of the property. [20] On 19 March 2003 a reply to the defence was lodged in answer to the counterclaim denying the allegations and saying that there was an issue estoppel because of the Small Claims Tribunal decision. [21] One can see immediately from the issues raised in the defence and counterclaim that many of the issues are identical to those that were raised in the Small Claims Tribunal. For example whether there was a contract, whether a contract existed between Turnbull and Duyvelshoff and whether the work was carried out in accordance with instructions and properly. The question of diminution of value of the property was also raised in the pleadings in the Small Claims Tribunal. [22] In relation to the counterclaim the question is whether there were different issues raised there, particularly in relation to the negligence. The Small Claims Tribunal does not have jurisdiction to decide matters of negligence, however certainly the skill of the work and diligence of the workmen was raised by Duyvelshoff in the Small Claims Tribunal. [23] As a result, on 14 April 2003, an application for summary judgment was heard in the Magistrates Court and that summary judgment application was successful with judgment being handed down on 22 April 2003. Discussion -- 7 of 13 -- 8 [24] The appellant claims that the decision of the Small Claims Tribunal referee could not have been a bar to proceedings in the Magistrates Court because as a matter of law the contract to perform work existed between Sherlock and Duyvelshoff, and Turnbull was a subcontractor engaged by Sherlock. This proposition depends upon acceptance of Duyvelshoff’s evidence that there was an agreement between Sherlock and Duyvelshoff, rather than Duyvelshoff and Turnbull. [25] Sherlock claimed that when he was approached about the job he made it clear that he could not do it and so he passed the job on to Turnbull. His case was that there was no subcontract but simply a referral of the work to Turnbull. Thereafter the contract was between Turnbull and Duyvelshoff. The decision of the Tribunal seems to accept that that was the case by indicating that there were problems with the contract between Turnbull and Duyvelshoff. The decision that Turnbull should be renumerated for his work implies that the Tribunal concluded that there was no contract between Sherlock and Duyvelshoff. [26] To reach the decision that the referee did he must have decided the following: • That there was a valid contract between Turnbull and Duyvelshoff (this is implied by his acceptance of continuing contact and discussion between Turnbull and Duyvelshoff in relation to the work to be performed) • That the work was contracted in a proper and workmanlike manner and sufficiently within instructions as communicated by Duyvelshoff • That there was no contract between Sherlock and Duyvelshoff and no money owing to Sherlock -- 8 of 13 -- 9 • That the claim for setoff by diminution of the value of the property abandoned the excess above $7500 and was unfounded ( I note that there were documents tendered at the hearing by a building company as well as photos of the work that had been done) The Trade Practices Act [27] Counsel in this appeal has raised the question of whether the Trade Practices Act 1974 is legislation that applies in this case, and whether the remedies of the Trade Practices Act 1974 should have been available to the appellant upon proof of breach of a warranty. If that is the case then it is argued that the Small claims Tribunals Act 1973 is inconsistent with the Trade Practises Act and should be displaced by the commonwealth legislation. [28] He referred to The Queen v. The Judges of the District Court of Brisbane ex parte Kruger Enterprises (1982) Qd.R. 623 where Mr Justice McPherson indicated that there is a likely inconsistency between s17(1) of the Small Claims Tribunal Act and the rights conferred by s.74(1) of the Trade Practices Act 1974 so as to be capable of giving rise to a direct inconsistency between the State Act and the Federal Act thereby displacing the State Act2. [29] Whilst the argument raises an interesting point of law, the pleadings do not in my view raise a consideration of s74(1) of the Commonwealth Act. The pleadings do not raise the necessary pre-conditions to the application of the Act, and the findings of the tribunal were that the work was performed in a satisfactory manner in any case. This matter should have been raised on the application for summary judgment -- 9 of 13 -- 10 with leave being sought to amend the pleadings. This is an appeal from a summary judgment application where no question of the Trade Practices Act 1974 was raised, pleaded or argued. Application For Summary Judgment – Principles [30] An application of summary judgment should only succeed where it is clear there is no triable issue. In Gray v Morris [2004] QCA 5, Chesterman J discussed the approach which should be taken to applications for summary judgement [at 11]: “ A plaintiff who claims to have a cause of action should not be prevented from prosecuting his claim unless it be obvious that he cannot succeed. Likewise, a defendant who resists a claim should not suffer judgment unless it be clear that neither the facts nor the law will assist him. The new rules, just as the old, are concerned with depriving a litigant of participation in the process which the law has always regarded as being the appropriate means of determining rights. The deprivation should only occur in a clear case, as the High Court said.” [31] The appellant says there was a need for trial to determine whether or not a contract existed. It is argued that the principles of privity of contract were not properly aired in the Small Claims Tribunal, but however, in my view, by inference privity of contract must have been considered. It is clear from Mr Sherlock and Mr Turnbull’s position that there is no question of privity of contract because the referee did not accept Mr Duyvelshoff when he said that his dealings were with Mr Sherlock and not with Mr Turnbull. Further, there was corroborating evidence in the form of a letter from Sharyn Redke which indicated that Mr Turnbull had spoken to Mr Duyvelshoff at the property. 2 at 629 -- 10 of 13 -- 11 Res Judicata [32] It was submitted that a litigant will be precluded from disputing a judicial determination in subsequent proceedings either: (1) because the cause of action in the subsequent proceedings no longer exists having been subsumed in the earlier judgment (res judicata); or (2) because the party will be prevented from relitigating an issue previously finally determined in the earlier proceedings (issue estoppel) [33] It was submitted that res judicata has no application in this case because the action in the Small Claims Tribunal was entirely different and distinct from the cause of action brought by the appellant in the counterclaim. Further, in respect to the claim, it was submitted that although the subject matter was involved in the claim brought in the Small Claims Tribunal they are separate and distinct causes of actions. [34] In that regard the appellant relies on the onus of proof. [35] In my view, it is clearly wrong to say that the matters raised in the Small Claims Tribunal were different to those raised in the Magistrates Court claim. They were essentially the same issues, the only difference being that the pleading is now by way of negligence in the alternative contract. The similarity of the actions is demonstrated by the fact that they are pleaded in the alternative because essentially the findings are the same in relation to both the actions. -- 11 of 13 -- 12 [36] In this case the appellant chose to use a certain venue no doubt to save time and money. Unfortunately he was not successful in his endeavours. He now seeks to relitigate the matters in the Magistrates Court by attempting to plead the matter differently. This is in direct conflict with the provisions of s 17(1) of the Small Claims Tribunals Act. [37] In Kruger Enterprises3 Macpherson J discussed the meaning of “issue” in s17(1) of the Small Claims Tribunals Act : ….the relief claimed is not itself the “issue” in proceedings conducted in accordance with the judicature system of pleadings. The relief is what is claimed and it is, if granted, the legal consequence of a favourable determination of the issue.” [38] The claims of res judicata and issue estoppel are essentially claims that the provisions of s17(1) of the Act apply to defeat the defence and counterclaim to the magistrates court claim. [39] At the end of the day the magistrate decided on the summary judgement application on the basis that the real question was the application of S17(1) of the Act to the pleadings in the Magistrates court. He clearly understood the power to order summary judgement should be exercised in only the clearest case and decided rightly in my view that this was such a case. There is no basis to find that the magistrate erred in his decision to order summary judgement in this matter. -- 12 of 13 -- 13 ORDER The appeal is dismissed. The appellant is ordered to pay the respondents costs of and incidental to this appeal to be assessed unless otherwise agreed. 3 supra at 627 -- 13 of 13 --