Citimax Henderson Pty Ltd v Cobblestone Constructions Pty Ltd
[2018] QDC 154
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- Unreported Judgment
- Citimax Henderson Pty Ltd v Cobblestone Constructions Pty Ltd[2018] QDC 154
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Citimax Henderson Pty Ltd v Cobblestone Constructions Pty Ltd[2018] QDC 154
Citimax Henderson Pty Ltd v Cobblestone Constructions Pty Ltd[2018] QDC 154
DISTRICT COURT OF QUEENSLAND
CITATION: | Citimax Henderson Pty Ltd v Cobblestone Constructions Pty Ltd & Anor [2018] QDC 154 |
PARTIES: | CITIMAX HENDERSON PTY LTD (ACN 616 130 806) (Plaintiff) v COBBLE STONE CONSTRUCTIONS PTY LTD (ACN 611 123 016) (First Defendant) And ADAM WILLIAM SCOTT ALLEN (Second Defendant) |
FILE NO/S: | 1276/18 |
DIVISION: | Civil |
PROCEEDING: | Application |
ORIGINATING COURT: | Brisbane |
DELIVERED ON: | 10 August 2018 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 30 July 2018 and 3 August 2018 |
JUDGE: | Williamson QC DCJ |
ORDER: | 1. By 4pm on 24 August 2018, the defendants file and serve a further amended defence consistent with these reasons for judgment. 2. The parties have liberty to apply with respect to costs. |
CATCHWORDS: | COURT PRACTICE AND PROCEDURE – QUEENSLAND CIVIL PROCEDURE – LEAVE TO WITHDRAW ADMISSIONS – where defendants bring application for leave to withdraw admissions – where defendants bring application for leave to withdraw deemed admissions – whether there is a genuine dispute about matters admitted or deemed to be admitted – whether leave to withdraw admissions should be granted in the circumstances |
CASES: | Hanson Construction Materials P/L v Norlis & Ors [2010] QSC 34 Rigato Farms Pty Ltd v Ridolfi [2000] QCA 292 |
COUNSEL: | Ms Hoiberg for the plaintiff/respondent Mr Kipps for the defendants/applicants |
SOLICITORS: | Allens for the plaintiff/respondent Irish Bentley Lawyers for the defendants/applicants |
Introduction
- [1]Citimax Henderson Pty Ltd wishes to redevelop land in which it has an interest at Everton Hills. For this purpose, it entered into a construction contract with a civil earthworks contractor, Cobblestone Constructions Pty Ltd. Mr Allen is the sole director of Cobblestone Constructions. Citimax Henderson commenced these proceedings to sue for recovery of money alleged to be owing to it under a progress certificate issued under the contract between it and Cobblestone Constructions. The debt is denied by Cobblestone Constructions. A Claim and Statement of Claim was filed in this Court on 6 April 2018. A Notice of Intention to Defend and Defence and Counterclaim were filed on behalf of the defendants on 11 May 2018. The defence filed was characterised by Mr Kipps, counsel for the Defendants, as a holding defence.
- [2]On 31 May 2018, the defendants filed an Amended Defence and Counterclaim. They accept that this document seeks to withdraw admissions made in the holding defence for which leave is required under r. 188 of the Uniform Civil Procedure Rules 1999 (‘UCPR’). This is an application by the defendants for leave under r. 188. Citimax Henderson has cross-applied to strike out those aspects of the Amended Defence and Counterclaim that seek to withdraw admissions.
- [3]For the reasons that follow, I direct the defendants file and serve a Further Amended Defence and Counterclaim consistent with these reasons. I will allow 14 days for this to occur. The parties have liberty to apply with respect to costs.
Rule 188 and relevant principles
- [4]Rule 188 of the UCPR provides that a party may withdraw an admission in a pleading only with the Court’s leave. Leave to withdraw is not obtained for the asking, subject to the payment of costs. The discretion is broad and unfettered[1].
- [5]It was common ground between the parties that, in the exercise of the broad discretion, there are five matters generally relevant to whether leave should be granted to withdraw an admission. Those matters were identified as follows[2]:
- (a)how and why the admission came to be made;
- (b)the evidence surrounding the issues the subject of the admission;
- (c)whether there is likely to be a real dispute about the evidence;
- (d)the extent of delay, if any, in making the application for leave to withdraw the admission;
- (e)the prejudice, if any, that will flow to the other party if leave is granted.
- [6]The Defendants initially sought leave to withdraw six admissions. They do not press their application with respect to paragraph 24 of the Amended Defence and Counterclaim, leaving only five admissions for me to consider. The admissions, and relevant parts of the pleadings, are identified in an Annexure to the Defendants’ submissions dated 3 August 2018. I will deal with the question of leave for the five admissions in the same order as the Annexure to the Defendants’ submissions dated 3 August 2018.
Paragraph 8, Statement of Claim/Paragraph 26, Amended Defence and Counterclaim
- [7]Paragraph 8 of the Statement of Claim is in the following terms:
“On 6 March 2018, the first defendant issued its Progress Claim (Final) dated 5 March 2018 (Payment Claim), claiming payment of $184,561.37 from the plaintiff.
Particulars
Email from the second defendant dated 6 March 2018 with attachments.”
- [8]The particulars of paragraph 8 of the Statement of Claim captures an email dated 6 March 2018. A letter dated 5 March 2018 was attached to this email. The letter is under the hand of Mr Allen in his capacity as director of Cobblestone Constructions and is described as a “Progress claim summary (Final)”. It was pointed out by Ms Hoiberg that the letter of 5 March 2018 is a progress claim for which the total amount payable is asserted to be $184,561.37, as is alleged in paragraph 8 of the Statement of Claim.
- [9]Mr Kipps drew attention to the table contained in the letter of 5 March 2018. The table contains the following summary particularising the basis on which the progress claim was, in part, calculated:
Detail | Amount |
Previous certified amount | $375,952.35 |
Contract Claim amount | $40,627.20 |
Variation Claim amount | $143,934.17 |
Total | $560,835.43 |
- [10]The Defendants’ holding defence admitted paragraph 8 of the Statement of Claim absent any qualification.
- [11]Paragraph 26 of the Amended Defence and Counterclaim denies paragraph 8 of the Statement of Claim in the following terms:
“The Defendants deny paragraph 8 of the Statement of Claim as the sum claimed is more particularly pleaded in paragraph 14 above, and as the sum claimed was not limited to $184,561.37 exclusive of GST.”
- [12]Paragraph 14 of the Amended Defence and Counterclaim pleads that Cobblestone Constructions issued a payment claim under the Contract for work which had been performed by it, or on its behalf as particularised in a table in the pleading. The table is a little over two pages in length and particularises work totalling $547,519.23 as being completed under the Contract. This figure is less than the total specified in the letter of 5 March 2018, being a sum of $560,835.43.
- [13]Citimax Henderson opposes the application for leave to withdraw the admission made in relation to paragraph 8 of the Statement of Claim.
- [14]Mr Kipps, who appeared on behalf of the Defendants, confirmed it was not contested that the letter of 5 March 2018 was a progress claim seeking a final payment of $184,561.37. Rather, he confirmed that the purpose of paragraph 26 of the Amended Defence and Counterclaim was to clarify two things. First, it was intended to clarify that the progress claim was not limited to the amount stated as it excluded GST. Second, the amendment was intended to provide a reference to further particulars of the claim, namely the work said to be completed and particularised in paragraph 14 of the Amended Defence and Counterclaim.
- [15]On this basis, I was not persuaded that there is genuine dispute about paragraph 8 of the Statement of Claim that founds a grant of leave to withdraw an admission. The facts alleged at paragraph 8 of the Statement of Claim are admitted. At its highest, the defendants wish to qualify the admission to make it clear the amount claimed did not include GST and particulars are provided elsewhere about the work completed to justify the claim. These points of clarification could be included in a Further Amended Defence and Counterclaim without the need to withdraw the admission to paragraph 8 of the Statement of Claim.
- [16]To the extent leave is required to permit the points of qualification, I grant leave. The points of qualification are relevant to the amount claimed under the contract by Cobblestone Constructions and the scope of works undertaken by it under the contract. These matters are central to the disputed issues in the proceeding. Ms Hoiberg did not submit qualifications in these terms would give rise to any prejudice.
Paragraph 13, Statement of Claim/Paragraph 31, Amended Defence and Counterclaim
- [17]Paragraphs 10 to 11 of the Statement of Claim plead that the Superintendent under the construction contract issued a progress certificate certifying the amount of $197,502.31 as being payable by Cobblestone Constructions to Citimax Henderson. Paragraph 12 pleads that Cobblestone Constructions have failed to pay the certified amount. Paragraph 13 of the Statement of Claim goes on to plead:
“In the premises, the first defendant:
(a) was (and remains) liable to pay the Amount Due to the plaintiff on and from 4 April 2018 under clause 42.1 of the Contract; and
(b) is in breach of clause 42.1 of the Contract.”
- [18]Paragraphs 6, 7 and 8 of the holding defence and counterclaim admit the facts pleaded in paragraphs 10, 11 and 12 of the Statement of Claim, but also deny that the Superintendent issued a valid certificate calling for payment under clause 42.1 of the Contract. This is confirmed at paragraph 9 of the holding defence and counterclaim where it is pleaded:
“As to paragraph 13 the First Defendant denies that it is liable to pay the amount owing as the Certificate had been issued on wrongful grounds and on no legal basis by the Superintendent and is therefore invalid.”
- [19]Paragraph 31 of the Amended Defence and Counterclaim pleads to paragraph 13 of the Statement of Claim in the following terms:
“As to paragraph 13 the First Defendant:
- (a)denies that it is liable to pay the amount owing or that it has breached clause 42.1 of the Contract for the reasons pleaded above; as the Certificate has been issued on wrongful grounds and on no legal basis by the superintendent and therefore is invalid.
- (b)alternatively, if it is found that the First Defendant is liable to the Plaintiff for any amount (which is denied), the First Defendant sets off this amount against the amount owing to the First Defendant pursuant to the Contract claimed in the Counterclaim.”
- [20]In my view, paragraphs 6 to 9 of the holding defence and counterclaim join issue with paragraph 13 of the Statement of Claim and the allegations of fact relied upon to support it. The Defendants have at no time admitted paragraph 13. Paragraph 31 of the Amended Defence and Counterclaim does not alter this position. It does however expand upon the reasons why the Defendants join issue. As the amended pleading does not seek to withdraw an admission in this respect, leave is not required under r. 188 of the UCPR.
Paragraph 23, Statement of Claim/Paragraph 40, Amended Defence and Counterclaim
- [21]The Statement of Claim separately pleads claims against Cobblestone Constructions and Mr Allen. With respect to Mr Allen, it is pleaded at paragraph 23 of the Statement of Claim that he contravened section 18 of the Australian Consumer Law. It is alleged that one contravention occurred by sending an email dated 21 December 2017. Paragraph 23 of the Statement of Claim relevantly pleads:
“The sending of the 21 December Email by the second defendant:
- (a)occurred in trade or commerce; and
- (b)was misleading or deceptive or likely to mislead or deceive as those terms are used in, and in contravention of, s 18 of the ACL, and the plaintiff repeats and relies upon paragraphs 20 to 22 above.”
- [22]The holding defence and counterclaim did not plead to paragraph 23 of the Statement of Claim. Rule 166(1) of the UCPR provides that the Defendants are therefore deemed to admit what is alleged in paragraph 23 of the Statement of Claim.
- [23]The failure to plead to paragraph 23 of the Statement of Claim was explained by affidavit material. The material satisfies me that the failure to plead to paragraph 23 was the product of inadvertence, rather than a deliberate decision or instruction given by Cobblestone Constructions or Mr Allen to their solicitor.
- [24]The Amended Defence and Counterclaim includes paragraph 40 pleading directly to paragraph 23 of the Statement of Claim in the following terms:
“The Defendants deny paragraph 23 of the Statement of Claim because:
- (a)the Second Defendant did not know at the time of transmission of the 21 December email that the invoices were not issued to JTS or ETC;
- (b)traffic works of the type recorded in those invoices were in fact being carried out on site;
- (c)the Second Defendant had observed such works being performed; and
- (d)the Second defendant had no reason to believe that the invoices were not rendered by JTS or ETC.”
- [25]Citimax Henderson does not oppose leave to withdraw the deemed admission to paragraph 23 of the Statement of Claim and I am satisfied that leave should be granted. It is appropriate that leave is granted because the failure to plead has been adequately explained, it was the product of inadvertence. Further, the evidence establishes that there is a genuine dispute between the parties about the truth or otherwise of the contents of the email of 21 December 2017. Mr Allen swears to the disputed facts in his affidavit. This, coupled with the absence of any prejudice to Citimax Henderson, is a compelling reason to grant leave to withdraw the deemed admission.
Paragraph 24, Statement of Claim/Paragraph 41, Amended Defence and Counterclaim
- [26]In the context of pleading a contravention of section 18 of the Australian Consumer Law, paragraph 24 of the Statement of Claim pleads as follows:
“In reliance upon the 15 December Email and 21 December Email:
- (a)the Superintendent certified the amount of $198,897.55 (plus GST) as payable to the first defendant for alleged asbestos removal work; and
- (b)the plaintiff paid that amount to the first defendant.”
- [27]The allegation made in paragraph 24 of the Statement of Claim goes to the issue of “reliance”.
- [28]The holding defence and counterclaim did not plead to paragraph 24 of the Statement of Claim. Rule 166(1) of the UCPR provides that the Defendants are therefore deemed to admit what is alleged in paragraph 24 of the Statement of Claim.
- [29]The failure by Cobblestone Constructions and Mr Allen to plead to paragraph 24 of the Statement of Claim was explained by affidavit material. The material satisfies me that the failure to plead to paragraph 24 was the product of inadvertence, rather than a deliberate decision or instruction given by Cobblestone Constructions or Mr Allen to their solicitor.
- [30]Paragraph 41 of the Amended Defence and Counterclaim seeks to depart from the deemed admission and pleads directly to paragraph 24 of the Statement of Claim in the following terms:
“The Defendants deny the allegations in paragraph 24 of the Statement of Claim because:
- (a)asbestos and unsuitable material were requested by the Plaintiff and Superintendent to be removed from the site and such works were performed;
- (b)the plaintiff and Mr Millier of the Superintendent were aware, or ought to have been aware, of works being performed at the site; and
- (c)the sums actually paid to the First Defendant are more properly described in Progress Certificate number 4 dated 9 February 2018.”
- [31]Leave to withdraw the admission was opposed by Citimax Henderson. It was submitted that there is no genuine dispute that the emails the subject of the allegation were sent. It was noted that the holding defence and counterclaim admitted that the emails had been sent as pleaded. Citimax Henderson does not suggest that it would be prejudiced if leave was granted.
- [32]I am satisfied that leave to withdraw the deemed admission should be granted. Whilst it is true that the existence of the emails is admitted, there is a genuine dispute as to whether it was reasonable for those emails to be relied upon in the manner alleged in paragraph 24 of the Statement of Claim. The evidence establishes that there is a genuine dispute between the parties about whether the asbestos removal works the subject of the allegation were in fact undertaken. Mr Allen swears to the disputed facts in his affidavit. He swears that the works were undertaken and in circumstances where the superintendent and Citimax Henderson were, or should have been aware the works were undertaken. These matters are relevant to the issue of reliance and are matters in dispute.
- [33]Further, the failure to plead has been adequately explained, it was the product of inadvertence. This factor, coupled with the absence of any prejudice to Citimax Henderson is a compelling reason to grant leave to withdraw the deemed admission.
Paragraph 25, Statement of Claim/Paragraph 42, Amended Defence and Counterclaim
- [34]Paragraph 25 of the Statement of Claim is a statement of conclusion and pleads as follows:
“In the premises, as a consequence of the second defendant’s contraventions of the ACL pleaded in paragraphs 19 and 23, the plaintiff has suffered loss and damage in the sum of $198,897.55 (plus GST).”
- [35]The holding defence and counterclaim did not plead to paragraph 25 of the Statement of Claim. The explanation for failing to plead to paragraph 25 is, again, inadvertence. The failure to plead was not the product of any instructions given by Cobblestone Constructions or Mr Allen to their solicitor.
- [36]Paragraph 42 of the Amended Defence and Counterclaim pleads directly to paragraph 25 of the Statement of Claim and is in the following terms:
“As to paragraph 25, the Defendants:
- (a)say that paragraph 25 does not comply with rules 157 and 158 of the Uniform Civil Procedure Rules 1999 (Qld) as it fails to give proper particulars of the alleged loss and damage suffered and is therefore liable to be struck out;
- (b)denies the allegations as the Second Defendant did not contravene section 18 of the ACL for the reasons pleaded above;
- (c)alternatively, deny that the Plaintiff has suffered any loss for the reasons already stated above; and
- (d)alternatively, do not admit that the Plaintiff has suffered loss and damage in the amount of $198,897.55 as having made reasonable enquiries the Second Defendant is unable to admit or deny the allegations as the Plaintiff has not provided proper particulars of the alleged loss and damage of $198,897.55 (plus GST).“
- [37]Citimax Henderson does not oppose leave to withdraw the deemed admission to paragraph 25 of the Statement of Claim, and I am satisfied that leave should be granted. It is appropriate that leave is granted because the failure to plead has been adequately explained. Further, it is sufficiently clear from the holding defence that Cobblestone Constructions and Mr Allen joined issue with the allegations that provide the foundation for the conclusion alleged in paragraph 25 of the Statement of Claim. This coupled with the absence of any prejudice to Citimax Henderson is a compelling reason to grant leave to withdraw the deemed admission.
Costs and the Cross-application
- [38]I will give the parties liberty to apply with respect to the question of costs for the application for leave to withdraw admissions.
- [39]Citimax Henderson made a cross-application to strike out paragraphs in the Amended Defence and Counterclaim. It was submitted that the fate of this application was contingent on the disposition of the application brought by Cobblestone Constructions and Mr Allen. I will hear from the parties as to the orders, if any, that need to be made with respect to the cross-application given the findings I have made above.