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  • {solid} Appeal Determined (QCA)

M J Arthurs Pty Ltd v Heaysman

 

[2015] QCA 113

 

SUPREME COURT OF QUEENSLAND

 

CITATION:

M J Arthurs Pty Ltd v Heaysman & Anor [2015] QCA 113

PARTIES:

M J ARTHURS PTY LTD
ACN 145 344 056
(appellant)
v
PETER ROBERT HEAYSMAN
(first respondent)
LEONIE COLLEEN HEAYSMAN
(second respondent)

FILE NO/S:

Appeal No 7736 of 2014

DC No 3970 of 2013

DIVISION:

Court of Appeal

PROCEEDING:

General Civil Appeal

Miscellaneous Application – Civil

ORIGINATING COURT:

District Court at Brisbane – [2014] QDC 160

DELIVERED ON:

23 June 2015

DELIVERED AT:

Brisbane

HEARING DATE:

23 April 2015

JUDGES:

Margaret McMurdo P and Holmes JA and Atkinson J

Separate reasons for judgment of each member of the Court, each concurring as to the orders made

ORDERS:

  1. The appeal is dismissed.
  2. The application to adduce fresh evidence is refused.
  3. The appellant is to pay the respondents’ costs of the appeal.

CATCHWORDS:

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – OTHER MATTERS – where the appellant and respondents signed a building contract – where the trial judge found that the respondents had validly withdrawn from the contract under s 72 of the Domestic Building Contracts Act 2000 (Qld) – where the appellant argued that the withdrawal notice was not valid as it was not faxed to its last known facsimile number – where the respondents sent the notice to the facsimile number listed for the appellant in the schedule to the building contract – whether the last known facsimile number was that known to the respondents or was the last number objectively ascertainable – whether the withdrawal notice was validly served

Domestic Building Contracts Act 2000 (Qld), s 72, s 75(1)

Civic Video Pty Ltd v Warburton (2013) 216 FCR 61; [2013] FCA 934, distinguished

Drake v Stanton [1999] FCA 1635, cited

Robertson v Banham & Company [1997] 1 WLR 446; [1996] EWCA Civ 860, considered

COUNSEL:

L D Bowden for the appellant

G Handran for the respondents

SOLICITORS:

Quinn & Scattini Lawyers for the appellant

Stephens & Tozer Solicitors for the respondents

  1. MARGARET McMURDO P:  I agree with Holmes JA’s reasons for refusing the application to adduce further evidence and for dismissing the appeal with costs.
  2. HOLMES JA:  The appellant, M J Arthurs Pty Ltd, is a registered builder which unsuccessfully sued the respondents, Mr and Mrs Heaysman, under a building contract.  The trial judge held that the Heaysmans had withdrawn from the contract under s 72 of the Domestic Building Contracts Act 2000 (which provides for a cooling off period) by means of a notice of withdrawal dated 26 September 2013, given by facsimile transmission.  M J Arthurs Pty Ltd contends that the trial judge erred in finding the notice of withdrawal was validly given because, it says, the notice was not sent to its last known facsimile number (the form of service for which the building contract provided).
  3. The Heaysmans say that this was not an argument made at first instance; if it had been, they would have put on evidence as to unsuccessful attempts made to send the notice to what M J Arthurs Pty Ltd says is the correct facsimile number.  They seek to adduce that evidence now by way of fresh evidence.  They contend in any event that the facsimile number to which the notice was sent was the last which M J Arthurs Pty Ltd had made known to them.  In addition, the Heaysmans have filed a notice of contention asserting that the trial judge erred, firstly, in finding that M J Arthurs Pty Ltd had communicated acceptance of their offer to contract by sending them an invoice; secondly, in failing to decide a material issue raised by the defence, which was that their offer had lapsed before any acceptance was communicated; and thirdly, in failing to find that the 26 September 2013 withdrawal notice was given to M J Arthurs Pty Ltd when it was sent by email to the company’s solicitors.

The building contract, withdrawal notices and the trial judge’s findings

  1. M J Arthurs Pty Ltd worked in conjunction with Optima Homes Pty Ltd, which marketed house and land packages, and it was the latter company with which Mr and Mrs Heaysman initially dealt.  On 14 January 2013, they signed a new home construction contract for M J Arthurs Pty Ltd to build a house.  Attached to the contract were “contract notes” in which, among other things, the Heaysmans and M J Arthurs Pty Ltd acknowledged that Optima Homes acted as agent on the builder’s behalf for the purposes of the building contract.  The Heaysmans gave their signed copy of the contract to a representative of Optima Homes, who forwarded it to Mr Arthurs, the sole director of M J Arthurs Pty Ltd.  He signed the contract on the company’s behalf on 21 January 2013 and returned the signed contract to Optima Homes.  However, there was no evidence that the executed copy had been provided to Mr and Mrs Heaysman and the trial judge found that acceptance of the offer had not been communicated at that point.  That finding is not in dispute here.
  2. The building works proceeded, notwithstanding the lack of a communicated agreement.  In July 2013, the relationship between M J Arthurs Pty Ltd and Optima Homes broke down.  An employee of M J Arthurs Pty Ltd telephoned the Heaysmans’ mobile telephone to inform them that Optima Homes was no longer acting as collection agent for the company; that call was followed up with an email on 25 July 2013, advising that Optima Homes had ceased acting as collection agents and that progress payments were now to be made directly to M J Arthurs Pty Ltd.  In similar vein, the solicitors acting for M J Arthurs Pty Ltd wrote to the Heaysmans on 30 July 2013, advising that their client had “terminated Optima’s engagement as collection agent”, while pointing out that “all other aspects of our client’s relationship with Optima remain unaffected”.
  3. On 27 July 2013, an invoice for the deposit on the work was sent by M J Arthurs Pty Ltd to Mrs Heaysman.  The trial judge held that when M J Arthurs Pty Ltd sent that invoice directly to the Heaysmans, it had communicated acceptance of the offer, and the contract was then made.  At that stage no copy of the signed contract or information statement for it had been sent to the Heaysmans.  By notice given on 1 August 2013, the Heaysmans purported to withdraw from the contract under s 72 of the Domestic Building Contracts Act 2000.
  4. That section provides:

“(1)The building owner under a regulated contract may withdraw from the contract under this section.

(2)The building owner may withdraw from the contract within 5 business days after the receipt day for the contract.

(3)If 5 business days have elapsed since the contract was entered into and there is no receipt day for the contract, the building owner may withdraw from the contract.

(4)Nothing in subsection (3) affects the right of the building owner to withdraw from the contract under subsection (2) if a receipt day subsequently applies to the contract.

(5)In this section—

receipt day, for a regulated contract, means—

(a)the day on which the building owner receives the following documents from the building contractor—

(i)a copy of the signed contract;

(ii)a copy of the appropriate contract information statement for the contract; or

(b)if the documents mentioned in paragraph (a) are received by the building owner from the building contractor on different days – the later of the days.”

  1. The trial judge held that the August attempt to withdraw was invalid because the conditions of s 72 were not met.  There was no receipt day (the Heaysmans never having received a copy of the signed contract) and as at 1 August, five days had not elapsed since (on his Honour’s construction) the contract was entered into.  However, his Honour found, on 19 September 2013, the solicitors for M J Arthurs Pty Ltd sent an electronic copy of the executed contract to the solicitors for Mr and Mrs Heaysman.  (In fact, that finding was not quite correct: it was an employee of Optima Homes who sent electronic copies of a number of contracts to the solicitors who acted for the Heaysmans and other purchasers.)  In response, the Heaysmans’ solicitors sent a further withdrawal notice on 26 September 2013 to the facsimile number in the building contract, receiving confirmation of transmission.
  2. Section 75(1) of the Domestic Building Contracts Act 2000 sets out the procedure by which a building owner may give a withdrawal notice.  That subsection provides:

To withdraw from a regulated contract under section 72 or 74, the building owner must, within the time allowed under the section for the withdrawal—

(a)give a withdrawal notice to the building contractor; or

(b)leave a withdrawal notice at the address shown as the building contractor’s address in the contract; or

(c)serve a withdrawal notice on the building contractor in accordance with any provision in the contract providing for service of notices on the building contractor by the building owner.”

  1. In this case, the contract provided that a notice was deemed given, inter alia, if it were “sent by facsimile transmission to the [other] party’s last known facsimile number, on receiving confirmation of transmission”.  A schedule to the contract gave particulars of the parties’ names, postal and email addresses and telephone and facsimile numbers.  In relation to M J Arthurs Pty Ltd, it included the detail, “Fax 07 5677 0624”.  That facsimile number, specified in the copy of the contract provided on 19 September 2013, was, the trial judge found, the last number for M J Arthurs Pty Ltd known to the Heaysmans.  It might in fact have related to Optima Homes, but sending the notice to it accorded with the provision in the contract.  His Honour ruled that the 26 September 2013 notice of withdrawal was valid because it had been given within five business days of the receipt date.  The Heaysmans had validly withdrawn from the contract and were not liable to pay any monies under it.

The issue of facsimile service

  1. Because M J Arthurs Pty Ltd maintained here that service of the second withdrawal notice was in issue at the trial, it is necessary to say something about the pleadings and to expand on what was said on the topic below.  Mr and Mrs Heaysman pleaded both withdrawals in the alternative to their primary defence (that they had not entered a contract with M J Arthurs Pty Ltd), alleging that they had sent the second withdrawal notice both by email sent on 26September 2013 to the company’s solicitors, and, by correspondence bearing that date,  to the company itself.  M J Arthurs Pty Ltd did not seek particulars of either means of service and did not, in its reply, put service of that notice in issue.  Instead, it admitted that its solicitor received an email from the Heaysmans’ solicitor on 26 September 2013 and that it had received correspondence from the Heaysmans’ solicitor “on or about 26 September 2013”.
  2. However, in an amended reply handed to the court on the morning of the trial, M J Arthurs Pty Ltd alleged that email service on the solicitors was invalid, or alternatively, that service by post on it was invalid because it had not occurred until more than five business days after the receipt day.  It was pleaded that there had, in consequence, been no valid withdrawal from the contract.  Counsel for the Heaysmans said that he had no objection to leave to amend being granted in relation to service by post, provided M J Arthurs Pty Ltd’s receipt of the withdrawal notice on 26 September 2013 was not challenged and the point was limited to an argument that 26 September was more than five business days after the receipt day.  Leave to amend was granted on that basis.
  3. In his evidence, Mr Arthurs said nothing about whether he had received the second withdrawal notice on behalf of M J Arthurs Pty Ltd or whether the facsimile number in the contract remained a viable way of contacting the company.  In his address, counsel for the company raised the question of whether the notice of withdrawal had been served by mail within time, pointing out that the admission in the original reply had only been to receipt “on or about 26 September 2013”.  The trial judge observed that if the document were sent by facsimile on 26 September, it would be in time.  Pressed by counsel for the Heaysmans about what point he was making, counsel for M J Arthurs Pty Ltd said that he did not know whether the facsimile number on a facsimile transmission sheet he was shown was that of M J Arthurs Pty Ltd.  He acknowledged, however, that the company had admitted receipt.  He accepted that if the withdrawal were sent by facsimile on 26 September “correctly in accordance with the terms of the contract and it was received that day” it would be within the relevant time period.
  4. In response, counsel for the Heaysmans subsequently tendered, without objection, a copy of a faxed letter dated 26 September and addressed to M J Arthurs Pty Ltd, attaching the withdrawal notice, together with the facsimile transmission sheet.  The documents proved, he said, delivery of the notice on 26 September.  The facsimile number shown was (07) 5677 0624.  Counsel for M J Arthurs Pty Ltd made no further submission on the matter.

M J Arthurs Pty Ltd’s arguments on appeal

  1. M J Arthurs Pty Ltd contends that the trial judge erred in finding the notice of withdrawal was validly given, because, it says, notice of withdrawal was not sent to its last known facsimile number.  The facsimile number ((07) 5677 0624)  shown in the contract as that of M J Arthurs Pty Ltd was in fact Optima Homes’ number.  Other documents associated with Optima Homes show that to be the case.
  2. The company relies on this statement by Tamberlin J in Drake v Stanton[1] in relation to a regulation permitting service by an envelope left at the recipient’s “last known address”:

“…the reference to “last-known address of the person” is to that address which has been made known by the applicant as at the time closest to the date in question”,

submitting that it applies equally in identification of a “last known facsimile number”.  There had been a good deal of communication between the parties since the signing of the contract which gave the (07) 5677 0624 number.  The notice which M J Arthurs Pty Ltd had sent on 25 July 2013 (directing payments to it) had contained the company’s correct facsimile number, as had the invoice for the deposit sent on 27 July 2013.  The Heaysmans’ first notice of withdrawal had been sent to the correct number for M J Arthurs Pty Ltd, and was answered by the company’s solicitors (and later Mr Arthurs on behalf of the company), but the second notice of withdrawal was sent to Optima Homes’ number.  The 19 September 2013 email by which Optima Homes forwarded contracts to the Heaysmans’ solicitors should not be regarded as having been sent by M J Arthurs Pty Ltd; and the contract in that form was, in any case, forwarded at a time when the Heaysmans already knew of the breakdown of the relationship between M J Arthurs Pty Ltd and Optima Homes.

  1. M J Arthurs Pty Ltd argues that the expression “the party’s last known facsimile number” should be read as importing an objective standard of reasonable care in adopting a particular facsimile number for the purpose of service.  Although in Robertson v Banham & Co,[2] Roch LJ had regarded it as established by authority that in reference to the service of process, “last known address” meant “the defendant’s last address known to the plaintiff”,[3] there was support in the decision of Jacobson J in Civic Video Pty Ltd v Warburton[4] for the view that an element of objectivity should be adopted.  In Civic Video, Jacobson J held that a requirement in the Bankruptcy Regulations 1996 that a bankruptcy notice be left at “the last known address of the person” could not be satisfied by leaving it at an address given to the creditor eight years earlier.  The purpose of the relevant rule was that the notice be brought to the debtor’s attention; consequently, the creditor ought to take steps to ascertain the debtor’s most recent address from readily accessible public records.
  2. Applying Jacobson J’s approach, it was submitted, there was an onus on the Heaysmans, if they wished to rely on facsimile service to a last known number, to examine the material in their possession carefully, and also, perhaps, to perform further searches to inform themselves.  The Heaysmans were on notice that service of the withdrawal was in issue, but had chosen to prove it by reliance on the facsimile transmission.  It was up to them to prove adequate service and they had not done so.

Discussion

  1. Civic Video entailed rather a different situation from the present, in which s 75(1)(c) contemplates the service of a withdrawal notice within the building owner/building contractor relationship as governed by the building contract.  Correspondingly, the clause in the contract providing for service of notices by one party on the other appears in the context of what may be anticipated to be a continuing pattern of communication and dealings between the parties over the time-limited life of the contract.  Against that background, the “party’s last known facsimile number” is sensibly read as meaning the facsimile number last made known to the other party in the course of those dealings and communications.  There is no reason to import a requirement that a party make inquiry beyond that context.
  2. As counsel for the Heaysmans pointed out, Optima Homes in fact remained M J Arthurs Pty Ltd’s agent for the purposes of the contract other than the collection of monies; that was made clear in the letter from the solicitors for M J Arthurs Pty Ltd sent on 30 July 2013.  Consequently, when an employee of Optima Homes sent a number of contracts, including the Heaysmans’, to the latter’s solicitors on 19 September 2013, he did so for Optima Homes in its capacity as agent for M J Arthurs Pty Ltd.  The copy of the Heaysmans’ contract contained the facsimile number used a week later for the sending of the withdrawal notice; it was the most recent representation of M J Arthurs Pty Ltd’s facsimile number.  At no stage had M J Arthurs Pty Ltd suggested that it was not a number which could be used for it.  In any event, in circumstances in which M J Arthurs Pty Ltd had made it clear that the cessation of Optima Homes’ agency was only in respect of the limited purpose of collecting payment, there was no reason for the Heaysmans to assume other than that M J Arthurs Pty Ltd meant that it should continue to be contacted by Optima Homes’ facsimile number, as specified in the copy of the contract originally given to them.
  3. Moreover, the Heaysmans’ counsel had, without objection, adduced evidence of the service of the withdrawal notice by facsimile on 26 September 2013 on the basis that it proved delivery; counsel for M J Arthurs Pty Ltd had acknowledged that if the withdrawal were faxed in accordance with the terms of the contract, it would be properly served; and M J Arthurs Pty Ltd had taken no issue by pleading or evidence about the correctness of the facsimile number on which it was served.  In those circumstances, the Heaysmans had met their onus in relation to proving service of the withdrawal notice.
  4. The trial judge properly made the findings that the number in the contract was the last facsimile number for M J Arthurs Pty Ltd known to the Heaysmans and that the withdrawal notice was served on the company by facsimile transmission to that number on 26 September 2013.

Orders

  1. Having reached that conclusion, I would dismiss the appeal.  It is unnecessary for me to consider the arguments in the notice of contention, nor is it necessary to deal with the application to adduce fresh evidence, which should formally be refused.  The respondents, Mr and Mrs Heaysman, should have their costs of the appeal.
  2. ATKINSON J:  I have read the reasons of Holmes JA.  I agree that, for those reasons, the appeal and the application for leave to adduce further evidence should be dismissed, with costs.

Footnotes

[1] [1999] FCA 1635.

[2] [1997] 1WLR 446.

[3] At 452.

[4] [2013] FCA 934.

Close

Editorial Notes

  • Published Case Name:

    M J Arthurs Pty Ltd v Heaysman & Anor

  • Shortened Case Name:

    M J Arthurs Pty Ltd v Heaysman

  • MNC:

    [2015] QCA 113

  • Court:

    QCA

  • Judge(s):

    McMurdo P, Holmes JA, Atkinson J

  • Date:

    23 Jun 2015

Litigation History

Event Citation or File Date Notes
Primary Judgment - - QDC
Appeal Determined (QCA) [2015] QCA 113 23 Jun 2015 -

Appeal Status

{solid} Appeal Determined (QCA)