SUPREME COURT OF QUEENSLAND

1. MUIR JA: The applicant applies, pursuant to s 118(3) of the District Court Act 1967 (Qld), for leave to appeal against an order made on 28 September 2007 by the District Court refusing the applicant leave to appeal against a decision of the Commercial and Consumer Tribunal dated 30 August 2006 ordering the applicant to pay the respondent, Café San Paul Pty Ltd, $7,587.

2. The District Court allowed an appeal by the respondent from the Tribunal’s decision and ordered that in lieu of the sum of $7,587 ordered to be paid by the Tribunal, the applicant pay the sum of $9,587.

3. Mr Marcelo Martins, a director of the respondent, commenced proceedings in the Tribunal on 10 December 2005 against the applicant. His form of application referred to a contract between himself and the applicant dated 27 January 2005 to perform work for a consideration of $6,600. The work was said to have been commenced on 29 January 2005 and not completed.

4. The following allegations were made in an accompanying statement of claim.

5. A minor works contract (“the Contract”) was entered into between the applicant and “proprietor named Marcelo Martins Jr. Director of [the respondent] . . . on . . . 27.07.05 for job description being shop refitting project.”

6. The work was not completed and the applicant, who had been paid by Mr Martins 20 per cent of the contract sum, did not appear on the third day of the seven day job.

7. The applicant left the works incomplete, “dismissed all subcontractors and did not want or was not willing to come to an agreement and did not care for the Contract he signed.”

8. Due to “the time frame . . . . for completion of the work” Mr Martins was obliged to spend “at least another $15,000” in order to complete the works and avoid damages claims. He claimed a minimum of $15,000 in damages.

9. Attached to the statement of claim was a copy of the written form of the “minor works contract” (“the written Contract”). It was signed by the applicant and by Mr Martins on behalf of the respondent.  The work to be performed was described as “Return shop to original state.  Demolishing, elec work, plumbing work, building work.  Owner to remove their possessions.”  The contract sum was stated to be $6,600; the date for commencement was 29 January 2005 and payment of progress claims was required seven days after the receipt of a claim.  No date was stated for the date of practical completion or for the duration of the works.

10. The record in this Court and the District Court file does not disclose the filing of any defence by the applicant.

The Tribunal’s reasons

11. On 30 August 2006 the Chairperson of the Tribunal published reasons in which it was noted that the name of the applicant before the Tribunal was amended at the commencement of the hearing to be Café San Paul Pty Ltd.

12. The Chairperson accepted the evidence of Mr Martins and that of Messrs de Araujo, Taee and Neto, witnesses called on behalf of the respondent. She also accepted the evidence of a Mr Starkey, who gave evidence on behalf of the respondent. The Chairperson rejected the applicant’s evidence, finding that he was “not a credible witness”.

13. The background to the dispute was explained as follows. The respondent operated a café business in premises in the Mt Ommaney shopping centre owned by AMP. In June 2005 the respondent was given notice to vacate the premises by AMP. The respondent was required to remove all fittings from the premises by 31 July 2005 to avoid incurring any penalty. Mr Martins told Mr de Araujo of a quote of $21,120 received by him from a builder, Queensland Project Professionals (“QPP”) for the necessary work. Mr de Araujo suggested that Mr Martins approach the applicant. In July 2005, after a discussion between Mr Martins and the applicant, who had been shown QPP’s work specification, the applicant agreed to do the work for $6,600.

14. Mr Martins and Mr de Araujo took the contract document to the applicant, who signed it. It was a term of the Contract that work would start on 29 July 2005 and that the contract sum of $6,600 would be paid within seven days from that date, by which time the work was to be complete.

15. The respondent paid the applicant $2,000 in cash prior to the commencement of the work as the applicant sought this amount in part payment of the sum of $6,600, it being agreed that the money was to be used to pay the applicant’s workers after each shift. The applicant’s workers were not paid for the third shift worked by them on Sunday, 30 July 2005.

16. On or about Sunday, 31 July 2005, the applicant asked Mr Martins for a further $1,000. In order to ensure that the work would continue, Mr Martins told the applicant that the money would be available on Monday, 1 August 2005, as his father had made arrangements for the money to be sent from Brazil late in the previous week. Notwithstanding Mr Martins’ advice about the money “the [applicant] said in clear terms that he would not complete the work.”

17. Attempts to contact the applicant by telephone on Monday, 1 August 2005 were unsuccessful. The respondent then had an urgent need to engage another contractor to complete the work and it did so.

18. The applicant’s assertions that: the minor works contract was not the parties’ contract; he was not shown the specification for the works; the respondent engaged the applicant’s workers and that the parties’ agreement was oral and required the respondent to pay the applicant and his workers at the end of each shift were rejected. It was held that it was the applicant’s obligation to pay his workers using money received from the respondent.

19. The applicant demonstrated an unwillingness to perform the Contract constituting a repudiation which entitled the respondent to terminate the Contract.

20. Because of the applicant’s repudiation of the Contract, the respondent was forced to engage QPP to complete the works for the sum of $13,970. The respondent’s damages are the difference between $13,970 and $6,600, namely $7,370.

The evidence before the Tribunal

21. Before the Tribunal were written statements of the witnesses referred to above. Those witnesses also gave oral evidence.

22. The Tribunal’s finding of repudiation is supported by the evidence of Mr Martins who, in a statement which was Exhibit 1 in the Tribunal proceedings, said in relation to the applicant’s demand for payment on Sunday 31 July that, “the [applicant] refused to listen to reason and walked off the job.” He further stated that, “When I turned up at the Café the following morning after having received the $1,000 from Brazil I noticed that the [applicant] had removed all his tools and equipment and had abandoned the worksite.”  In his oral evidence Mr Martins also swore to having been told by the applicant that he wasn’t coming back to the site.

23. Mr de Araujo confirmed in a statement, which became Exhibit 7 before the Tribunal, that he heard Mr Martins telling the applicant that the money would be arriving on Monday, 1 August. His evidence was that on Sunday, 31 July the applicant “had not shown up for work . . . . and had taken all his equipment that had been kept in the premises for the first two days.”

24. Mr Neto also confirmed in his evidence that on Sunday, 31 July the site was vacant and the equipment left in the premises by the applicant the night before had been removed.

25. In his evidence Mr Taee generally confirmed Mr Martins’ version of events, including the applicant’s perusal of the schedule of works and his agreement to perform those works prior to signing the written Contract.

The Appeal to the District Court

26. The evidence before the Tribunal was before the District Court on the hearing of the appeal from the Tribunal. Under section 100 of the Commercial and Consumer Tribunal Act 2003 (Qld) an appeal to the District Court against a decision of the Tribunal lies only by leave on the ground of either error of law or excess, or want, of jurisdiction.  The learned District Court judge in his reasons found that there was no suggestion of excess or want of jurisdiction and that consequently, it was necessary for the applicant to make out an error of law in order to obtain leave to appeal.  That finding was not contested on the hearing of the application for leave to appeal.

27. It is now proposed to discuss the grounds of appeal stated in the Notice of Appeal upon which the applicant intends to rely should his application for leave to appeal succeed.

Leave to appeal out of time should not have been granted to the respondent

28. Although the respondent did not seek leave to appeal from the Tribunal’s decision until 10 August 2007, the primary judge implicitly gave leave to appeal and then upheld the appeal. Section 100 of the Commercial and Consumer Tribunal Act 2003 (Qld) provides:

“An appeal must be filed within 28 days after the decision [of the Commercial and Consumer Tribunal] takes effect.”

29. There is no power in the District Court of Queensland Act 1967 (Qld) or in the Uniform Civil Procedure Rules 1999 (Qld)^[1] to extend this time limit.  Accordingly, if leave to appeal is granted, the applicant’s appeal must succeed, at least to the extent of reducing the judgment by $2,000.

The wrong test was applied for the assessment of damages.  The Contract with the respondent was for labour only, whereas the new contract with QPP was for labour and materials.

30. The applicant’s argument is that, in assessing damages, the Tribunal and the judge did not take into account the consideration that under the Contract the respondent was obliged to provide any materials required and provide some labour, whereas, the applicant assumes QPP supplied all materials and met all additional labour costs. It is submitted that the cost of materials and the cost of the additional labour the respondent would have been required to provide under the Contract, must be deducted from the difference between $6,600 and $13,970 in order to arrive at the proper measure of damages.

31. The applicant’s case in this regard is based on the following passage from the transcript of evidence before the Tribunal.

“APPLICANT:  . . . . My god $2000 was a reasonable amount of money for me to start that job we had more money but we weren’t up to that part that’s a fact you know.  We didn’t have to buy any equipment I had put the hoardings up paying the bins paying the nightly security what else did you need.

RESPONDENT:  Well Mr Martins the next contract you engaged was for $13,900 so surely commonsense would have told you there was a lot of material still required.

APPLICANT:  Afterwards I realised – yeah – what a little job we had done but that’s not my fault, you being the builder should have looked should have analysed and how much.  Your quote should have been.  You gave me the quote and I said thank you very much and we did over 50 hours in a row working with you guys and we never thought this is irrelevant to it.

RESPONDENT:  You do acknowledge that this quote was only for labour an approximate labour contract.

APPLICANT:  No, I don’t recall speaking to you about that I thought it was a total quote for the cost.  The only costs I was covering was for nightly security the bins outside and for – no – that’s it.  That was it because I didn’t have anymore outgoing costs.

RESPONDENT:  Well what about all the other material required?

APPLICANT:  We hadn’t come up to that yet.

RESPONDENT:  We hadn’t come up to that yet but you would’ve had to of come up to that – paying out a lot of money for materials.

APPLICANT:  Yes.

RESPONDENT:  Yeah plasterboard top coating for all the concrete paint etc etc that would have been required.

APPLICANT:  Yes.

RESPONDENT:  But you didn’t have any money for that.

APPLICANT:  I was having some money for that – the money I gave to you at the time was enough to cover what we were up to, then when it came time to when we needed more equipment then I would’ve sorted something out, it’s not up to you I would’ve have and got a loan.  I don’t know whatever.  That money I had at the time was enough to do what we were doing at the time, where we were up to.  We were demolishing at the time and weren’t building.  I don’t know it feels like we’re in a circle here and not getting out of it.”

(emphasis added)

32. The following exchange had occurred a little earlier:

“RESPONDENT:  You didn’t have any materials to continue on with the job.

APPLICANT:  I would’ve had by Monday if we needed more materials.

RESPONDENT:  The confusion arose because you didn’t have any money.

APPLICANT:  I didn’t have any money on the Saturday when you asked me for it.

RESPONDENT:  This is where the confusion arose.

APPLICANT:  Yeah but I didn’t have to give you anymore from your total quote I didn’t know how much you were going to spend on the price of things.  I said I’ll give him $2,000 the total price was $6,600 you should’ve been able to use that.

33. Shortly after this exchange, Mr Martins said:

“APPLICANT:  Well that was the agreement between you so they’d be paid each nightshift.  And if I didn’t have any money it would have to be from you but in the end you would have recovered all that because I would have paid you the total cost which is what we agreed.

RESPONDENT:  Well how did I know that Mr Martins?  Have you ever stated in any of your information how I was to be paid?

APPLICANT:  In my perspective I was already giving you over the 20% and I didn’t know how you would be needing more money – the labour was already paid and I would’ve come up with some more money on Monday – and I was willing to give it to you.”

34. The Tribunal found, implicitly, that the Contract was partly oral and partly written. That finding is plainly correct. Mr Martins accepted in his oral evidence that he had agreed to pay the applicant sufficient monies to enable the applicant’s labourers to be paid at the end of each shift. He accepted also that he was providing the rubbish bins, paying for security night staff and providing the services of himself, Mr de Araujo and Mr Neto. The findings of the Tribunal recorded in paragraph 14 are not disputed.

35. As is the case with much of the evidence there is some confusion over whether the Contract was for the provision of services only. In the passage from the transcript on which the applicant relies to show that the respondent was obliged to provide any materials required to enable the works to be performed, Mr Martins initially stated that he “thought it was a total quote for the cost,” apart from nightly security and bins. Mr Martins accepted, however, that he “would’ve had to come up to . . . paying out a lot of money for materials . . . plasterboard top coating for all the concrete paint etc.”

36. Although the focus of this evidence was not on the question of damages and some of it is equivocal, it does appear probable that Mr Martins was admitting to an obligation on the respondent’s part to provide materials. Importantly, the written Contract makes express provision only for the supply of labour and the respondent does not allege a separate oral agreement under which the applicant was to provide materials. The contract price also suggests that there was no obligation on the applicant to supply materials.

37. QPP charged $13,970 to perform the balance of the work. That appears from an invoice dated 14 August 2005 exhibited to a statement of Mr Martins. Exhibited to a statement of the applicant is a specification dated 1 August 2005 which lists the work to be performed by QPP in taking over the works from the applicant. It contains no express provision in relation to the supply of materials. However, as the Contract, which was for a price of $6,600, was for labour only and, according to the evidence, $1,500 to $2,000 worth of labour had already been supplied by the applicant, it seems reasonable to conclude that the $13,900 cost included the cost of materials. Mr Martins, who appeared for the respondent, did not dispute this. He, in fact, accepted that QPP’s charges included the cost of materials.

38. The quantum of the respondent’s claim was a live issue before the Tribunal even though the evidence in relation to it was deficient and confusing. The only evidence of the cost of materials was that given by the applicant when being cross-examined by Mr Martins. In response to a question by Mr Martins, “what materials did you need”, the applicant said, “there would’ve been approximately $5000 worth of materials that would’ve had to have gone into the rectification of the job.” The court is entitled to act on this evidence. The applicant is a builder and was thus in a position to give expert opinion evidence.

39. The damages suffered by the respondent are to be calculated by deducting from the amount of the QPP payment of $13,970 the contract price of $6,600. To the resulting figure of $7,370 must be added the $2,000 paid by the respondent to the applicant. The respondent is entitled “so far as money can do it, to be placed in the same situation, with respect to damages, as if the contract had been performed.”^[2]

40. If the Contract had been performed the respondent would have spent $6,600 and it would have had to purchase the materials. As things turned out it spent $13,970 plus $2,000 but did not purchase the materials. The price of the materials of $5,000 and the contract price of $6,600 must therefore be deducted from $15,970. The end result is $4,370. That is the quantum of the respondent’s damages.

41. I do not consider it appropriate to make any further deduction in respect of the labour the respondent would have had to supply to the applicant. There is reason to suppose that in giving his opinion on the cost of materials, the applicant would not have erred on the side of conservatism. More importantly, there is no evidence of the arrangements, if any, between QPP and the respondent in relation to the supply of labour.

The judge erred by ordering the applicant to pay the further sum of $2,000 and the cost of the respondent’s appeal.

42. This relates to the first ground of appeal. It is further argued that if the Tribunal did err, the Tribunal should be ordered to pay the respondent’s costs. That submission is correct if there were any costs of the respondent’s appeal.

The primary judge erred in applying the principles expressed in Holland v Wiltshire.

43. The point the judge was making by reference to Holland v Wiltshire^[3] was merely that in order to accept the applicant’s repudiatory conduct, it was not necessary for the respondent to give formal written notice of acceptance.  Acceptance of the repudiation could be communicated by other means.  In this case, the judge concluded, by inference, that acceptance of the repudiation was made sufficiently plain by the respondent engaging another contractor and having that contractor perform the works originally provided for under the Contract.  On the evidence, these actions of the respondent very quickly came to the attention of the applicant.

44. Communication of an election to terminate may be by conduct. In Holland v Wiltshire it was held that a vendor’s election to treat the Contract as discharged by the purchaser’s breach was sufficiently manifested by his proceeding to advertise the property for sale, and by his selling it.^[4]  No error in the judge’s reasons has been demonstrated.

The judge erred in law in not finding that the Tribunal erred in not allowing the applicant to examine his own witness whilst allowing Mr Martins an opportunity to examine his witness

45. The applicant argues that his witness, Mr Starkey, was “dismissed and proceedings closed without the [applicant] being able to examine him.” He submits he was denied the opportunity of re-examining Mr Starkey.

46. After the oath was administered to Mr Starkey, the Chairperson said to Mr Martins that he was at liberty to cross-examine. There was then a very short cross-examination. The Chairperson thanked Mr Starkey for coming and excused him. She then stated, “Alright gentlemen that concludes the evidence - is there anything you’d like to say briefly by way of summary, it needn’t be lengthy . . .” The applicant did not suggest that there were any questions he wished to ask Mr Starkey.  Mr Starkey’s statement was extremely brief.  It contained a hearsay statement and not much of any probative value.  There is nothing to suggest that the applicant would have been slow to assert a desire to lead further evidence from Mr Starkey or to re-examine him if that was his intention at the time.  This point lacks substance. 

There was an error in law in that the Tribunal failed to ascertain if the applicant received a copy of the Contract

47. The point of the contention appears to be that, at some stage, Mr Martins is alleged to have claimed that the applicant supplied a copy of the written Contract to the respondent but that, again according to the applicant, it emerged in evidence that Mr Martins had supplied the written Contract. This is said to give rise to a breach of the requirement in the Commercial and Consumer Tribunal Act 2003 (Qld) that a person appearing before the Tribunal must not state anything the person knows is false or misleading in a material particular.

48. The point, if there is any substance in it, has no bearing on the merits of the contractual claims and is thus irrelevant to the outcome of the application for leave to appeal.

The judge did not consider the ground of appeal alleging that “the contract has then been falsified in the second respondent’s favour”

49. The second respondent in the District Court appeal was Mr Martins.

50. This ground is unintelligible. It is not addressed in the applicant’s outline of submissions. In the outline of submissions filed in the District Court the applicant claimed that Mr Martins had backdated the written Contract to 27 July 2005. There was some cross-examination around the point in the Tribunal hearing. Mr Martins did not accept that the date on the written Contract had been changed but was sure that it would have had to have been in existence on or before 29 July. He said, “. . . there is no way I could’ve started the job on the 29^th without having this [the written Contract]”.

51. The existence of the written document is not denied. Nothing is alleged to flow from the change of date and, more importantly, the evidence does not establish a change of date. The applicant was disbelieved by the Tribunal. For these reasons the applicant has not made good this ground.

Mr Martins altered the date on the Contract committing the offence of forgery and breached the Corporations Act 2001 by omitting ABN and ACN numbers

52. The alteration point has been dealt with above.

53. The omission of the ABN and ACN numbers was not alleged to result in any contractual invalidity. The allegation is pointless.

The respondent attached the QPP scope of works and work method statement to the Contract to be provided to AMP management without the applicant’s knowledge or permission

54. The above conduct is said to constitute a false declaration in breach of the Criminal Code Act 1899 (Qld).

55. Even if the allegation is correct, it has no bearing on the parties’ contractual rights and obligations. Before the Tribunal the allegation, if substantiated, could have been used to damage Mr Martins’ credit. If that was done, it failed.

Under the Master Builders’ Act a party must receive a copy of the entire Contract otherwise the Contract is void

56. There is no Master Builders’ Act.  The applicant swore in the Tribunal proceedings (Ex 11) that he received the written Contract on 26 May 2006.

In breach of the Domestic Building ContractsAct 2000 (Qld) the respondent failed to give written notice of termination stating the grounds of termination.

57. This was not a case advanced before the Tribunal. There is no mention of it in the applicant’s outline of submissions filed in the District Court on 12 October 2006. Even if there was substance in the point, which seems unlikely,^[5] it is too late to raise it now.  It cannot be said that the facts relevant to the point were established beyond controversy or that, had the point been raised before the Tribunal evidence could not have been led which “by any possibility could have prevented the point from succeeding.”^[6]

The judge erred in finding that $2,000 would be enough to pay four persons for three shifts

58. There was a body of imprecise evidence around this point. The question is a factual one. If the judge erred on a question of fact it does not give rise to a right of appeal.

The primary judge erred in law in holding that no notification of notice of termination was required

59. This point is a repeat of the one addressed above.

The Tribunal erred in law in concluding that the applicant repudiated the Contract.  The Tribunal erred in law by “evading this ground of appeal.”

60. The judge disposed of the relevant grounds of appeal (14, 16, 17) on the basis that the grounds challenged findings on credibility. His Honour found, inferentially, that it had not been shown that the Tribunal, “‘has failed to use or has palpably misused [its] advantage’, or has acted on evidence which was ‘inconsistent with facts incontrovertibly established by the evidence’, or which was ‘glaringly improbable’”.^[7]

61. The Tribunal found that notwithstanding what Mr Martins told the applicant about money being available for him on Monday, 1 August 2005, the applicant “said in clear terms that he would not complete the work.” There was evidence to support that finding. There was thus evidence to ground a finding of repudiation. The applicant’s argument is based on a version of the facts which was rejected.

The judge erred in law in failing to uphold grounds of appeal 18, 19, 20 and 21

62. These complaints were, in effect, that the Tribunal erred in amending the name of the claimant from Mr Martins to the respondent. It is asserted that the Tribunal further erred in not requiring Mr Martins to prove that he had authority to act on the respondent’s behalf in contracting and in terminating the Contract. Furthermore, there was an error of law on the part of the Tribunal in failing to require proof that Mr Taee had authority to act on behalf of the respondent.

63. It was apparent on the face of the written Contract that it was between the applicant and the respondent.

64. The Tribunal may include a person as a party to the proceedings on its own initiative if it considers that such person ought “have the benefit of an order of the Tribunal in the proceedings”.^[8]  In the light of the evidence it would have been quite inappropriate for the Tribunal not to substitute the respondent for Mr Martins as a party.  If the applicant wished to contend that Mr Martins or Mr Taee lacked authority in any material respect, it was incumbent on him to raise that matter and prove it.  No such point was taken before the Tribunal. 

Conclusion

65. The conventional approach to the granting of leave to appeal under s 118(3) of the District Court of Queensland Act 1967 (Qld) was expressed as follows by Keane JA, with whose reasons the other members of the court agreed, in Pickering v McArthur^[9]:

“. . . 

Leave will usually be granted only where an appeal is necessary to correct a substantial injustice to the applicant, and there is a reasonable argument that there is an error to be corrected.  Where there is a challenge to the exercise of a discretion in respect of a matter of pleading or procedure, it will usually be difficult to satisfy the first of these criteria, especially where the discretion in question was exercised so as to permit the continuation of proceedings towards a hearing on the merits.

. . .” (footnotes deleted)

66. Section 118(3):

". . . .

serves the purpose of ensuring that this Court's time is not taken up with appeals where no identifiable error or injustice can be articulated by those litigants whose arguments have already been fully considered at two judicial hearings."^[10]

67. The subject dispute has consumed time and costs disproportionate to the amount genuinely in dispute. The true issues for determination have been obscured by the applicant’s disposition to rely on legal issues which are entirely without merit or which lack a factual foundation. This approach has made it more likely that meritorious arguments will fail to be recognised in the general body of dross. These considerations suggest that leave to appeal should not be granted. The applicant, however, has identified one clear error of law which, in my view, ought be corrected. That is, the impermissible extension of the time limited by s 100(3) of the Commercial and Consumer Tribunal Act 2003 (Qld).  As leave to appeal ought be granted to correct this error, it is desirable also to allow the appeal so as to ensure that damages are assessed in accordance with correct principles.

68. I would order that:

1. leave to appeal the order of the District Court made on 28 September 2007 be allowed;

2. such order be varied by substituting for “$9,587” in paragraph 3 thereof “$4,370”.

3. The following be substituted for paragraph 4 of such order:

“The applicant Gerald James Wenn pay the respondent Café San Paul Pty Ltd’s costs of and incidental to the application for leave to appeal to be assessed on the standard basis on the scale of the District Court applicable to a claim of less than $50,000.”

69. As both parties have had an approximately equal measure of success on the appeal, it is appropriate that there be no order as to costs. As both were self represented the costs would, in any event, be minimal.

70. WHITE J:  I agree with the reasons of Muir JA and the orders he proposes.

71. LYONS J:  I have had the advantage of reading the reasons of Muir JA.  I agree with the reasons of his Honour and with the orders proposed.