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Franklin (Qld) Pty Ltd v Holliday[2017] QCAT 339

Franklin (Qld) Pty Ltd v Holliday[2017] QCAT 339

CITATION:

Franklin (Qld) Pty Ltd v Holliday [2017] QCAT 339

PARTIES:

Franklin (Qld) Pty Ltd

(Applicant)

v

Fiona Holliday and David Holliday (Respondent)

Francis Paul John Galea

(Second Respondent by Counter-Application)

APPLICATION NUMBER:

BDL093-14

MATTER TYPE:

Building matters

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Member Deane

DELIVERED ON:

1 September 2017

DELIVERED AT:

Brisbane

ORDERS MADE:

  1. Francis Paul John Galea is joined as Second Respondent by Counter-Application.
  2. Fiona Holliday and David Holliday must file in the Tribunal and provide to Franklin (Qld) Pty Ltd and Francis Paul John Galea a complete copy of the pool contract, including the general conditions, by 4:00pm on 29 September 2017.
  3. Fiona Holliday and David Holliday must file two (2) copies in the Tribunal and give one (1) copy to Franklin (Qld) Pty Ltd and Francis Paul John Galea of their amended counter-application to include the claims made against Francis Paul John Galea, by 4:00pm on 29 September 2017.
  4. Fiona Holliday and David Holliday must file two (2) copies in the Tribunal and give one (1) copy to Franklin (Qld) Pty Ltd and Francis Paul John Galea of any further statements of evidence including expert evidence upon which they intend to rely, by 4:00pm on 29 September 2017.
  5. Franklin (Qld) Pty Ltd must file two (2) copies in the Tribunal and give one (1) copy to Fiona Holliday and David Holliday of its Response to the amended counter-application, by 4:00pm on 27 October 2017.
  6. Franklin (Qld) Pty Ltd must file two (2) copies in the Tribunal and give one (1) copy to Fiona Holliday and David Holliday of any further statements of evidence including expert evidence upon which it intends to rely, by 4:00pm on 27 October 2017.
  7. Francis Paul John Galea must file two (2) copies in the Tribunal and give one (1) copy to Fiona Holliday and David Holliday of his Response to the amended counter-application, by 4:00pm on 27 October 2017.
  8. Francis Paul John Galea must file two (2) copies in the Tribunal and give one (1) copy to Fiona Holliday and David Holliday of any statements of evidence including expert evidence upon which he intends to rely, by 4:00pm on 27 October 2017.
  9. The application is listed for an experts’ conclave in Brisbane at 1:30pm on 4 December 2017.
  10. The member of the Tribunal convening the conclave shall have such powers, including making directions or other orders, as are required:
    1. for the conduct of the conclave; and
    2. for the conduct of the proceeding.
  11. The parties must file in the Tribunal two (2) copies of:
    1. the name, specialisation and contact details of the experts to participate in the Conclave; and
    2. an agreed list of issues to be considered by the experts at the Conclave; and
    3. a list of documents provided to their experts, by 4:00pm on 10 November 2017.
  12. If the parties are unable to agree on a set of issues, each party must file in the Tribunal two (2) copies and give to each other one (1) copy of a list of issues they propose to be considered by the experts at the Conclave, by 4:00 pm on 17 November 2017.
  13. In either case, the Tribunal will settle the list of issues to be considered by the experts at the Conclave and will provide the settled list to each party and to the experts, by 4:00pm on 24 November 2017.
  14. The Registrar must provide a copy of the experts’ joint report to the parties within seven (7) days of receipt by the Tribunal.
  15. If the experts prepare a joint report, that report will be the experts’ evidence in chief.  An expert may only submit a further report on issues of disagreement recorded in the joint report.
  16. Except with the Tribunal’s leave, a party may not:
    1. raise a matter not already mentioned in the joint report.
    2. submit evidence from an expert (whether or not they participated in the conclave) that contradicts, departs from or qualifies an opinion about an issue the subject of agreement in the joint report.
    3. submit evidence from any other expert about matters mentioned in the joint report.
  17. The experts may attend the conclave by telephone.
  18. The application is listed for a Directions Hearing in Brisbane at 1:30pm on 7 February 2018.
  19. The application is listed for a 2 day Hearing in Mackay on a date to be advised.

CATCHWORDS:

PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – JOINDER OF CAUSES OF ACTION AND OF PARTIES – PARTIES

CONTRACTS – BUILDING, ENGINEERING AND RELATED CONTRACTS – PERFORMANCE OF WORK – REMEDIES FOR BREACH OF CONTRACT

Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 28, s 42

Franklin (Qld) Pty Ltd v Holliday [2015] QCAT 217

Holiday v Franklin (Qld) Pty Ltd [2017] QCATA 8

Tracey and Anor v Olindaridge Pty Ltd and Ors [2014] QCAT 617

G Rocca Pty Ltd v Timetrex Pty Ltd (Building and Property) [2017] VCAT 261

This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act).

REPRESENTATIVES:

APPLICANT:

represented by S.B.Wright & Wright and Condie, Solicitors

RESPONDENT:

Self- represented

REASONS FOR DECISION

  1. [1]
    Mr Holliday entered into a written contract with Franklin (Qld) Pty Ltd to construct a pool at Mr and Mrs Holliday’s house. Later Franklin (Qld) Pty Ltd entered into a separate contract with the Hollidays to construct a new garage and storeroom.  Franklin (Qld) Pty Ltd commenced these proceedings claiming amounts owing under the second contract.  The Hollidays originally counterclaimed in these proceedings in respect of claimed defective work in relation to the pool. 
  2. [2]
    Franklin (Qld) Pty Ltd’s claims have been determined and the counter-application, which was previously dismissed, has been remitted for determination.[1]  While the appeal was underway, the Hollidays commenced separate proceedings[2] in relation to defective work in relation to the pool.  Those proceedings named Frank Galea, Lynn Galea, LID Constructions and Lynns Interior Design as respondents as well as Franklin (Qld) Pty Ltd. 
  3. [3]
    At the directions hearing held on 7 December 2016, the Hollidays consented to Frank Galea, Lynn Galea, LID Constructions and Lynns Interior Design being removed as respondents. 
  4. [4]
    On 4 January 2017, the Hollidays filed an Application for miscellaneous matters seeking directions to join Francis Paul John Galea,[3] Lynette Jessie Galea[4] and two businesses, namely Lynn’s and Lynn’s Interior Designs as respondents. The application set out brief reasons for the joinder and attached a number of documents.
  5. [5]
    The Hollidays were directed[5] to file in the Tribunal and serve Franklin (Qld) Pty Ltd and each of the proposed respondents copies of the application and further submissions, which were to address:
    1. the correct name of the respondent proposed to be joined;
    2. if the proposed respondent is a business, include a current business name search identifying the person or entity carrying on the business;
    3. if the proposed respondent is a company, include a current ASIC search;
    4. in respect of each proposed respondent, identify the legal basis of the claim against the respondent and the final relief sought.
  6. [6]
    On 6 February 2017, the Hollidays filed a further Application for miscellaneous matters dated 2 February 2017, in substantially similar terms seeking the same orders with a slightly amended section setting out the reasons for the joinder and attached a number of documents most (if not all) of which had been attached to the 4 January 2017 application. 
  7. [7]
    Since the Appeal Tribunal remitted the Hollidays’ counter-application for determination the two BDL proceedings have been consolidated into this proceeding.[6]  
  8. [8]
    The Tribunal may make an order joining a person as a party if the Tribunal considers the person should be bound by or have the benefit of a decision, the person’s interests may be affected by the proceeding or for another reason it is desirable that the person be joined. [7]
  9. [9]
    The Hollidays contend that it is desirable for Mr and Mrs Galea and ‘their companies’ to be joined because:
    1. it is unlikely the joinder will result in unnecessary delay or cost;
    2. any length added to the proceeding will be reasonable and will be offset against the practical benefit that will be gained;
    3. the joinder is likely to minimise the need for future related proceedings in the event that ‘the Respondents close and/or de-register their companies or simply try to ‘hide’ their assets to protect their own interests’;
    4. the joinder will not add to the complexity of the proceedings given the identities of the parties involved.
  10. [10]
    The Hollidays contend that ‘all of the companies’ of Mr and Mrs Galea should be included as there has been five changes to Franklin (Qld) Pty Ltd’s ASIC extract since the pool problem ‘became clear’.  They contend that the changes are evidence that ‘they are trying to get out of responsibility’.  The evidence before me does not support this submission.  The ASIC search simply reveals that Franklin (Qld) Pty Ltd has made three changes to its registered address and the address of its principal place of business. 
  11. [11]
    Franklin (Qld) Pty Ltd and the proposed respondents oppose the joinder.
  12. [12]
    On 16 February 2017, Franklin (Qld) Pty Ltd filed an Application for miscellaneous matters seeking various orders dismissing the Hollidays’ applications,[8] seeking new dates for the filing of evidence, directions in relation to expert evidence and consolidation of the proceedings. 
  13. [13]
    Franklin (Qld) Pty Ltd opposes the joinder application because the Hollidays did not serve a copy of the 4 January 2017 application and did not comply with the direction to set out the legal basis of their claims against each proposed respondent.  Franklin (Qld) Pty Ltd acknowledges receipt of the 2 February 2017 application. The 2 February 2017 application is substantially the same as the 4 January 2017 application.  The Hollidays are self represented. The Tribunal is required to act with little formality and technicality.[9]  I am not satisfied that Franklin (Qld) Pty Ltd and the proposed respondents have been denied natural justice in respect of the joinder application by reason of not having received a copy of the 4 January 2017 application. 
  14. [14]
    The Hollidays filed submissions in reply[10] which seek to clarify the basis of their contentions.

Francis Paul John Galea and Lynette Jessie Galea

  1. [15]
    I am not satisfied that Mrs Galea should be joined. I am not satisfied that the Hollidays have demonstrated the basis for an arguable cause of action against Mrs Galea in either contract or negligence.
  2. [16]
    I am satisfied that Mr Galea should be joined as Second Respondent by counter-application in these proceedings. 
  3. [17]
    I am satisfied that there is an arguable cause of action that a person in Mr Galea’s position:
    1. being the sole director of a contracting company may have some personal responsibility for a breach by the company in its performance of the contract;[11] and
    2. who is said to have physically performed at least some of the work and directed performance of work, may owe a duty of care separate to the duty owed by the company, to personally exercise reasonable care.
  4. [18]
    The Hollidays seek to join Mrs Galea because she:
    1. is a 75% shareholder of Franklin (Qld) Pty Ltd;
    2. signed the quote and pool contract;
    3. sent the invoices;
    4. is the registered holder of businesses including Lynn’s and Lynn’s Interior Designs.
  5. [19]
    The Hollidays seek to join Mr Galea because he:
    1. was ‘the builder on site’;
    2. is named as nominee on the QBCC licence used for the work;
    3. directed ‘his employees’ during construction;
    4. is the person who did not follow the engineers drawings;
    5. is a 25% shareholder of Franklin (Qld) Pty Ltd. 
  6. [20]
    The Hollidays contend that Mr and Mrs Galea are the people responsible, are the beneficiaries of Franklin (Qld) Pty Ltd and the businesses also sought to be joined and

are taking all the profits of the above listed companies, therefore they should be held personally responsible for the activities and negligence of those companies as well.[12]

  1. [21]
    Franklin (Qld) Pty Ltd and the Galeas submits that Mr and Mrs Galea’s involvement was previously decided when they were removed from the proceedings.[13]   The Hollidays submit that they were ‘coerced’ into agreeing to the removal of the proposed respondents.  A copy of the transcript of the directions hearing was not provided to me.  In any event, they moved reasonably quickly to make this application.
  2. [22]
    The law recognises that a company is a separate legal entity, which exists separate from its directors and shareholders.  In a limited category of cases individuals associated with a company may be held personally liable to another party but it is necessary to show more than that a person was a director or a shareholder of an entity with whom the party has contracted.[14]
  3. [23]
    In G Rocca Pty Ltd v Timetrex Pty Ltd (Building and Property)[15] the relevant Tribunal acknowledged that in certain circumstances a director may be personally liable for the wrongs of the company and that it was necessary

to distinguish between the conduct of the director in his capacity as a director, and his conduct alleged to have been in a personal capacity.[16]

  1. [24]
    There is no allegation that the contract was with any person other than the current party, Franklin (Qld) Pty Ltd.  There is no allegation that the contract had erroneous licence or ABN details creating confusion as to the correct contracting party.  There is no evidence before me that Mr Holliday believed Mr Galea or Mrs Galea was entering into the contract on their own behalf.
  2. [25]
    The Schedule to the pool contract clearly shows that the Contractor was Franklin (Qld) Pty Ltd.  The Schedule shows the relevant licence number is 1163707.  The QBCC search shows that this is the licence number held by Franklin (Qld) Pty Ltd.  All licensed companies are required to have a nominee, who must also hold a separate licence, with a separate licence number.  The QBCC search confirms Mr Galea has been the nominee since 2009.  The Schedule did not use Mr Galea’s licence number.  The Schedule also sets out Franklin (Qld) Pty Ltd’s ABN, which is confirmed by the ABN search provided.
  3. [26]
    Mrs Galea signed the pool quote.  In the top right-hand corner of each page of the quote it states the name Franklin (Qld) Pty Ltd and sets out the company’s ABN and building licence number.   Immediately below Mrs Galea’s name, it states her position, namely Manager, Franklin (Qld) Pty Ltd.  Mrs Galea signed the pool contract ‘for and on behalf of the Contractor’.  Copies of the invoices, said to have been issued by Mrs Galea, do not appear to be in evidence before me.  The evidence before me supports Mrs Galea’s contention that she signed the documents as an employee of the company and not as an individual.  There is no evidence before me that Mrs Galea is a director of Franklin (Qld) Pty Ltd nor a licensed builder.
  4. [27]
    The submissions are brief and do not clearly set out the legal basis for refuting the contention that Mr Galea was only acting as Franklin (Qld) Pty Ltd’s agent.  Whilst the Hollidays’ submissions could be clearer, of significance is that they arguably refer to Mr Galea’s personal role in the performance of the contractual work and the directing of that work.  The Tribunal is not a pleadings jurisdiction.  Witness statements facilitate the clarification of issues in dispute. 
  5. [28]
    Franklin (Qld) Pty Ltd contends that it is not desirable to join additional parties as it would increase the length of the hearing and would require new directions to allow additional statements of evidence. I accept that joining Mr Galea is likely to increase the length of the hearing and require additional evidence.  Balancing these factors against a possible need for the Hollidays to commence separate proceedings against Mr Galea if the joinder is not allowed, I find that it is desirable to also ventilate issues relating to any personal liability of Mr Galea within these proceedings.
  6. [29]
    I find that it is appropriate to join Mr Galea to allow the Hollidays an opportunity to establish, through their statements of evidence and for the Tribunal to decide upon a final hearing, whether Mr Galea:
    1. as director, is personally responsible for any breach by the company in its performance of the contract; and
    2. owed a duty of care, separate to the duty owed by the company, to personally exercise reasonable care and whether he breached any such duty of care.  

Lynn’s

  1. [30]
    The Hollidays seek to join Lynn’s because Franklin (Qld) Pty Ltd encompasses the business known as Lynn’s. 
  2. [31]
    I am not satisfied that it is appropriate that the business Lynn’s is joined. 
  3. [32]
    The ASIC[17] search shows that Lynn’s is a business name rather than a separate legal entity, such as a company, and that the current owner of the business name is the current party to these proceedings, Franklin (Qld) Pty Ltd.  It also shows that Mrs Galea has not been the owner of the business name since 2009, well before the entering into of the pool contract.

Lynn’s Interior Designs

  1. [33]
    The Hollidays seek to join Lynn’s Interior Designs because Franklin (Qld) Pty Ltd encompasses the business known as Lynn’s Interior Designs and all pool plans and specifications were prepared and supplied by Lynn’s Interior Designs.
  2. [34]
    I am not satisfied that it is appropriate that the business Lynn’s Interior Designs is joined. 
  3. [35]
    The ASIC[18] search shows that Lynn’s Interior Designs is a business name rather than a separate legal entity, such as a company, and that the current owner of the business name is the current party to these proceedings, Franklin (Qld) Pty Ltd.  It also shows that Mrs Galea has not been the owner of the business name since 2009, well before the entering into of the pool contract.
  4. [36]
    The Hollidays filed a statement of evidence on 31 January 2017 attaching a number of documents including expert reports by G.W. Goddard & Associates.[19]  It attached schedules forming part of the pool contract but did not attach the General Conditions. A complete copy of the contract should be before the Tribunal.  It is appropriate to make directions for the progress of the matter, including to allow the parties an opportunity to submit any additional evidence they wish to rely upon and for the experts’ conclave to proceed, which was to be convened on 30 March 2017 but was abandoned due to an extreme weather event. 

Footnotes

[1]Franklin (Qld) Pty Ltd v Holliday [2015] QCAT 217; Holiday v Franklin (Qld) Pty Ltd [2017] QCATA 8.

[2]BDL246-15.

[3]Known as Frank Galea.

[4]Known as Lynn Galea.

[5]Direction, Senior Member Brown dated 18 January 2017.

[6]Direction, Senior Member Brown dated 5 May 2017.

[7]Queensland Civil and Administrative Tribunal Act 2009 (Qld) (“QCAT Act”), s 42(1).

[8]Dated 4 January 2017 and dated 2 February 2017.

[9]QCAT Act, s 28(3)(d).

[10]Filed 8 March 2017.

[11]Assuming a breach of the company’s obligations can be established.

[12]Submissions filed 8 March 2017.

[13]Direction 7 December 2016.

[14]Tracey and Anor v Olindaridge Pty Ltd and Ors [2014] QCAT 617.

[15][2017] VCAT 261.

[16]Ibid, [39].

[17]Application for miscellaneous matters filed 16 February 2017 attached at page 32.

[18]Application for miscellaneous matters filed 16 February 2017 attached at page 33.

[19]Dated 28 August 2015 and 16 January 2017.

Close

Editorial Notes

  • Published Case Name:

    Franklin (Qld) Pty Ltd v Fiona Holliday & Ors

  • Shortened Case Name:

    Franklin (Qld) Pty Ltd v Holliday

  • MNC:

    [2017] QCAT 339

  • Court:

    QCAT

  • Judge(s):

    Member Deane

  • Date:

    01 Sep 2017

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

Cases Cited

Case NameFull CitationFrequency
Franklin (QLD) Pty Ltd v Holliday [2015] QCAT 217
2 citations
Jump To
Cite 1 - [2015] QCAT 217
Cite 2 - [2015] QCAT 217
G Rocca Pty Ltd v Timetrex Pty Ltd (Building and Property) [2017] VCAT 261
3 citations
Jump To
Cite 1 - [2017] VCAT 261
Cite 2 - [2017] VCAT 261
Cite 3 - [2017] VCAT 261
Holliday v Franklin (QLD) Pty Ltd [2017] QCATA 8
2 citations
Jump To
Cite 1 - [2017] QCATA 8
Cite 2 - [2017] QCATA 8
Tracey and Anor v Olindaridge Pty Ltd and ors [2014] QCAT 617
2 citations
Jump To
Cite 1 - [2014] QCAT 617
Cite 2 - [2014] QCAT 617

Cases Citing

No judgments on Queensland Judgments cite this judgment.

1

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