Albem P/L v PKF Queensland P/L [2004] QDC 13

DISTRICT COURT OF QUEENSLAND CITATION: Albem P/L v PKF Queensland P/L [2004] QDC 013 PARTIES: ALBEM PTY LTD ABN 37 009 820 302 Applicant/Appellant v PKF QUEENSLAND PTY LTD ABN 55 086 218 Respondent FILE NO/S: Appeal No BD 2967/03 DIVISION: Appellate PROCEEDING: Appeal ORIGINATING COURT: Commercial and Consumer Tribunal DELIVERED ON: 27 January 2004 DELIVERED AT: Brisbane HEARING DATE: 19 January 2004 JUDGE: Judge Alan Wilson SC ORDER: 1. Appeal dismissed 2. Appellant to pay respondent’s costs of and incidental to the appeal assessed on the standard basis CATCHWORDS: APPEAL – LEAVE TO APPEAL – appeal under Commercial and Consumer Tribunal Act 2003 - principles to be applied COSTS – APPEAL – order for costs under s 100(8) of the Commercial and Consumer Tribunal Act 2003 Cases Considered: Adam Peter Brown Male Fashions Pty Ltd v Phillip Morris Incorporated (1981) 148 CLR 170 at 176-177 ASC v Schreuder (1994) 14 ACSR 614, at 625 Decor Corp Pty Ltd v Dart Industries Inc (1991) 104 ALR 621, at 623 Glenwood Properties Pty Ltd v Delmoss Pty Ltd (1986) 2 Qd R 388 at 389 King Ranch Australia Pty Ltd v Cardwell Shire Council (1985) 2 Qd R 182, at 190 Ryde City Council v Transfield Pty Ltd (2002) NSWSC 1037 Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 at 259 Pettit v Dunkley (1971) 1 NSWLR 376 at 382 -- 1 of 6 -- 2 Westminster City Council v Great Portland Street Estates PLC (1985) 1 AC 661 at 673 Dennis Willcox v FCT (1988) 79 ALR 267 at 276 COUNSEL: Mr Steensma, solicitor, for the appellant Mr Smith of counsel for the respondent SOLICITORS: Corrs Chambers Westgarth for the appellant Biggs & Biggs for the respondent [1] The appellant seeks leave to appeal from a decision of the Commercial and Consumer Tribunal of 14 August 2003 and, in the appeal proper, an order that the decision be set aside and the matter remitted to the Tribunal Member for determination according to law. [2] The dispute before the Tribunal concerned a flooring subcontract and disputed variations to it involving about $25,000. The particular variations involved preparation of the subflooring upon which the flooring was to be laid. On 10 July 2003 the appellant applied for a summary order dismissing the respondent’s proceedings under s 126 of the Commercial and Consumer Tribunal Act 2003 (“CCT Act”). The Tribunal Member heard the application on 8 August 2003 and dismissed it in Reasons published on 14 August. [3] The appeal is brought under s 100(1), CCT Act which provides: A party to a proceeding before the tribunal may appeal to the District Court against a decision of the tribunal, with the court’s leave, only on the ground of – (a) error of law; or (b) excess, or want of, jurisdiction. [4] The appellant relies upon the first ground. It contends the learned Tribunal Member was in error in failing to properly deal with, or accept, submissions of law made on its behalf. Those submissions were made, it is clear, on the basis that the appellant admitted all facts alleged by the respondent for the purpose of the application for a summary decision. It submitted that the respondent’s claim against it was precluded by a clause in the subcontract between them dealing with latent conditions, or another clause dealing with variations1, and contended these clauses, and the arguments it presented to the Tribunal, constituted complete defences to the respondent’s claim under the contract or its alternative claims upon bases involving issues of restitution, or estoppel, or an alleged “separate” contract. [5] Notwithstanding the concession about the facts made by the appellant the reasons contain the following passages: 12. It was also common ground that the discretion ought not be exercised if issues of fact were to be resolved (sic) but ought to be exercised when the only matter in dispute is a question of law, unless the extent and complexity of the law and argument in relation thereto warranted a full hearing. Findings 1 Clauses 12.1A and 40.1A, set out at pp 4-6 of the Tribunal’s Reasons -- 2 of 6 -- 3 13. While it may have been the case that prior to amendment the statement of claim might not have disclosed a reasonable cause of action (although I do not decide the point as it is unnecessary to do so for the purpose of this application), it cannot be said that the amended statement of claim fails to disclose a reasonable cause of action. The amendments introduce a claim for unjust enrichment and in the alternative a claim based on the creation of a separate oral contract outside the terms of the written contract. Assuming, as one must for the purpose of this application, that the applicant can prove all the facts alleged in the amended statement of claim it cannot be said that no reasonable cause of action has been disclosed. Accordingly the application pursuant to s 126(2)(a) of the Act must fail. … 16. In effect counsel for the PKF submitted that while those clauses of the contract might operate to defeat PKF’s contractual claim and perhaps even its claim of estoppel, the Tribunal would not be in a position to make a decision in that regard until it had resolved questions of fact. Further it was submitted that those clauses could not defeat PKF’s claim based on a second oral contract. 17. I accept the accuracy of that submission. There are issues of fact to be resolved. These revolve around identification of the scope of work under the contract. If PKF is right when it alleges that diamond grinding and deep fill preparation works were outside the scope of minor concrete floor preparation work agreed to be undertaken by it in the written contract, contractual bars may not operate against it. However, until evidence has been heard one cannot determine whether or not PKF’s allegation can be proved. 18. Having identified a factual dispute there is no utility in further addressing the legal arguments, although a prudent applicant undertaking a risk analysis should give careful consideration to the defence, in particular to the legal arguments that will be run as comprehensively outlined in the Main Contractor’s submissions. [6] The reference in paragraph 16 is to various clauses in the contract, including 12.1A and 40.1A. The reference in paragraph 17 to “minor concrete floor preparation work” is a reference, I was told, to another part of the contract and between them these references constitute elements of a dispute between the parties as to the proper construction of the contract, and which of its various clauses should prevail. [7] All of these arguments were, the appellant contended, fully ventilated before the learned Tribunal Member, and should have been determined in the context of its application for summary dismissal brought under s 126 which provides: (1) The respondent against whom a proceeding is started by application in the tribunal may at any time apply to the tribunal under this division for a decision in favour of the respondent (also a “summary decision”). (2) The tribunal may give the summary decision or make any other decision the tribunal considers appropriate if satisfied – (a) no reasonable cause of action is disclosed against the respondent; or (b) the proceeding is frivolous, vexatious or an abuse of the process of the tribunal; or (c) the respondent has a defence to the proceeding. -- 3 of 6 -- 4 [8] The appellant’s contention before the Tribunal and on appeal was that summary dismissal should have been granted under ss 126(2)(a) or (c), the latter being principally relied upon. The learned Tribunal Member fell, it was said, into error in two respects: first, finding that there was a dispute of fact notwithstanding the appellant’s concession that it accepted all the respondent’s contentions; and, failing to deal with relevant submissions – namely, its arguments about the proper construction of the contract and the contention that the respondent’s claims were precluded under the two clauses mentioned earlier. [9] It is accepted that references to a need to resolve questions of fact, mentioned in paras. 16 and 17 of the Reasons are mistaken. There are grounds for thinking, however, that the mistake is nothing more than an infelicitous expression of the Tribunal’s acceptance of the respondent’s argument that the two contractual clauses relied on by the appellant do not provide an absolute defence to the respondent’s claims. Paragraph 13 of the Reasons, and some of the words in paragraphs 16 and 17 support this conclusion: “Further it was submitted that those clauses could not defeat PKF’s claim based on a second oral contract … I accept the accuracy of that submission”. Once this is appreciated, it also appears the reference to issues of fact concerning “…identification of the scope of the work under the contract” was one properly intended to refer to a dispute which is, essentially, a legal one. [10] When the nature of the error is understood there are, moreover, a number of good reasons for concluding that leave to appeal ought not be granted or, even if leave is given, the appeal should be dismissed. The very requirement for leave indicates the Legislature’s concern to reduce appeals from the decisions of this Tribunal2. That conclusion is strengthened, I think, by s 100(8) of the CCT Act which also requires that appellants pay the costs of appeals, including the costs of any transcript. [11] Second, this is an application for leave to appeal from an interlocutory order, a jurisdiction in which appellate courts traditionally exercise particular caution3. That caution is manifest in judicial warnings that an applicant for leave must be able to demonstrate not only a prima facie error in the judgment below, but also that the question in issue is one of general importance, something which the public interest requires should be the subject of further argument and the decision of an appeal court4. [12] The appellant’s representative argued vehemently and with considerable reference to authority that the Tribunal Member’s reasons exhibited a clear failure to acknowledge or come to grips with the submissions he had made to her, a failure to give adequate reasons and, therefore, a failure to properly carry out a judicial duty5. 2 Decor Corp Pty Ltd v Dart Industries Inc (1991) 104 ALR 621, at 623 3 Decor Corp Pty Ltd v Dart Industries Inc (supra) at 623; Adam Peter Brown Male Fashions Pty Ltd v Phillip Morris Incoroprated (1981) 148 CLR 170 at 176-177 4 Glenwood Properties Pty Ltd v Delmoss Pty Ltd (1986) 2 Qd R 388 per Carter J at 389 5 Dennis Willcox v FCT (1988) 79 ALR 267 AT 276; Ryde City Council v Transfield Pty Ltd (2002) NSWSC 1037; ASC v Schreuder (1994) 14 ACSR 614, at 625; Westminster City Council v Great Portland Street Estates PLC (1985) 1 AC 661 at 673; Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 at 259; Pettit v Dunkley (1971) 1 NSWLR 376 at 382; and, King Ranch Australia Pty Ltd v Cardwell Shire Council (1985) 2 Qd R 182, at 190 -- 4 of 6 -- 5 The fact that a failure of this kind may have occurred does not, however, elevate the error to the point where it can be categorised as something of general importance. In the scale of things, and in the context of the cost of legal proceedings, the dismissal of an application for summary judgment here does not ascend to that level. [13] The appellant also contended that the decision appealed from involved not only an error of principle, but worked a substantial injustice to it. In Adam P Brown Male Fashions Pty Ltd v Phillip Morris Inc (supra) the High Court cautioned against laying down rigid and exhaustive criteria in applications for leave to appeal, while acknowledging the question of injustice is a “relevant and necessary consideration”. Here, the appellant will at worst be obliged to argue, again, the legal contentions it expounded before the Tribunal Member, in circumstances where it is tolerably clear the Member was troubled that that those issues involved some complexity and, albeit inelegantly, declined to deal with them. That was a conclusion within her discretion, but not one which can be categorised as imposing substantial injustice upon the appellant. [14] The cases emphasise the care the court must exercise in adjudicating upon applications for summary determination6. Here, each party apparently has contractual terms to which it can refer, and about which it can mount arguments, for and against the resolution of the determination of the respondent’s claims. By inference, there are questions of law upon which the rights of the parties probably turn. By further inference, those are questions the Tribunal Member thought should properly be deferred for complete ventilation at a full hearing. Furthermore, even if it is wrong to draw that inference from her Reasons, it was a conclusion reasonably open and something which would properly have told against summary dismissal. [15] Section 126 makes it clear her discretion was a wide one. While other minds might have come to a different conclusion and even, perhaps, been persuaded to deal with the legal argument in full at a summary stage, her implied refusal to do so was one open under that discretion. [16] Although I was not referred to any authority on the point a question which also arises is whether or not an appeal ought to be upheld when, from the tenor of the Reasons, the Tribunal might if directed to reconsider the matter come to the same conclusion – refusal of the application – even if the reasons were expressed differently. In light of what is deduced to be the tenor of the Reasons there must be a high degree of probability the Tribunal would again refuse the application. I am comforted in that conclusion because had the matter been determined before me at first instance on the material I saw, my inclination would have been to refuse it. [17] It is impossible not to feel some degree of sympathy for the appellant. Paragraphs 16 and 17 of the Reasons refer to a factual dispute which does not exist. At the same time, a careful reading and analysis of them in light of the principles set out above should have served to dissuade the appellant from taking the matter further. [18] As to costs the CCT Act, s 100(8) mentioned earlier provides: 6 General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125; National Mutual Property Services (Australia) Pty Ltd v Citibank Savings Ltd (1995) 132 ALR 514 -- 5 of 6 -- 6 (8) The appellant must pay the costs of the appeal, including the costs of any transcript. On any view the words have a plain meaning. For the appellant it was, not surprisingly, contended they could not have the effect that a successful appeal nevertheless visits the appellant with all the costs, which ought to be limited to costs associated with the preparation of the record. The Dictionary to the Act (Schedule 2) is of no assistance and the respondent’s counsel advised that neither the Explanatory Notes nor the Second Reading Speech (or any other material in Hansard) provide help. It is impossible to construe them as meaning other than that the appellant must pay all costs associated with the appeal, including those of the respondent. -- 6 of 6 --