Walsh Accountants Pty Ltd v Tonge
[2023] QCAT 467
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- Unreported Judgment
- Walsh Accountants Pty Ltd v Tonge[2023] QCAT 467
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Walsh Accountants Pty Ltd v Tonge[2023] QCAT 467
Walsh Accountants Pty Ltd v Tonge[2023] QCAT 467
QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL
CITATION: | Walsh Accountants Pty Ltd v Tonge [2023] QCAT 467 |
PARTIES: | walsh accountants pty ltd (applicant) v mark tonge (respondent) |
APPLICATION NO: | 167/23 |
MATTER TYPE: | Other minor civil dispute matters |
DELIVERED ON: | 13 October 2023 |
HEARING DATE: | 25 August 2023 |
HEARD AT: | Southport |
DECISION OF: | Adjudicator Scott-Mackenzie |
ORDERS: |
|
CATCHWORDS: | JURISDICTION – where applicant’s claim for accountancy fees – where respondent disputes authority to carry out work and alleges failure to carry out work – whether nature of claim changed – whether claim for a debt or liquidated demand of money – whether Tribunal has jurisdiction to hear and decide the proceeding – where parties applied for leave to be represented – whether proceeding likely to involve complex questions of fact and law Practice Direction 9 of 2010 Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 3, s 4, s 11, s 43, schedule 3 Alexander v Ajax Insurance Co Ltd [1956] VicLaw Rp 5, [1956] VLR 436 Cameron Family Trust v Applikote Gold Coast Pty Ltd [2022] QCATA 36 Cello Court Pty Ltd v Body Corporate for Cello Court CTS 42339 [2021] QCATA 62 Financial Advisors Australia v Mooney & Anor [2016] QCATA 181 Hashfield v Gold Coast City Council [2020] QCATA 36 Hill v Berghofer [2011] QCATA 34 Morales v Murray Lyons Solicitors (a firm) [2010] QCATA 87 Odgers, Pleadings and Practice, (12th ed.), 1939 Spain v The Union Steamship Co of New Zealand Ltd (1923) 32 CLR 138 Spannys Whitsunday Real Estate v Proserpine Youth Club Inc [2023] QCAT 171 |
APPEARANCES & REPRESENTATION: | This matter was heard and decided on the papers pursuant to section 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) |
REASONS FOR DECISION
Application
- [1]The applicant, on 23 March 2023, made application to the Tribunal for an order that the respondent pay to it $12,267.00 for accountancy fees, $1,002.00 interest and $367.00 and $47.00 for the filing fee on the application and service, a total of $13,683.00 (original application).
- [2]Filed with the original application are two invoices, the first invoice number INV-04018 the applicant to Aussie Prime Land Pty Ltd dated 14 May 2021 for $9,240.00 and the second invoice number WALI000196 the applicant to Aussie Prime Land Pty Ltd dated 30 November 2021 for $440.00.
- [3]Aussie Prime Land Pty Ltd is not a party to the proceeding.
Default decision
- [4]The original application was served on the respondent on 17 April 2023. It did not file a response, and, on 19 May 2023, the Tribunal ordered that the respondent pay to the applicant $13,841.85 (default decision), calculated as follows:
Claim $12,267.00
Costs $ 367.00
Interest $ 1,207.85
$13,841.85
Setting aside the default decision
- [5]On 20 June 2023 the respondent made application to the Tribunal to set aside the default decision. It filed with the application an affidavit sworn by the respondent on 14 June 2023. Exhibited to the affidavit are an Australian Securities and Investments Commission search of Aussie Prime Land Pty Ltd, an engagement letter dated 10 June 2020 signed by the respondent on 17 June 2020 (engagement letter) and correspondence. The correspondence includes a letter from the respondent’s lawyers to the applicant’s lawyers dated 14 November 2022.
- [6]In summary, the respondent swears:
- he did not authorise work for financial years 2018 and 2019;
- the applicant did not communicate with him in relation to preparation of the 2020 income tax return; and
- the applicant failed to complete and lodge the income tax returns.
- [7]Subsequently, the respondent filed an affidavit of Mr Spalding, a lawyer employed by the respondent’s lawyers, and supplementary submissions. Mr Spalding deposes to the estimated time of delivery of letters after posting in Australia. The supplementary submissions assert a lack of proof of service of the original application and the default decision was the irregular.
- [8]On 29 June 2023 the default decision was set aside.
Response
- [9]The respondent, on 28 June 2023, filed a response to the original application. In the response, the respondent denies the debt. Otherwise, the response is without particulars of the ground or grounds of denial.
- [10]The applicant filed an affidavit of Mr Walsh, affirmed by him on 24 August 2023. The affidavit exhibits correspondence, the engagement letter, and the invoices. He deposes to the applicant being engaged by the respondent[1], the work performed[2], correspondence[3], the provisions of the engagement letter providing for a late payment fee, interest, and indemnity[4], and an authority given by the applicant to Ms Briscoe and Ms Matheou[5].
Hearing
- [11]The original application came on for hearing before the Tribunal on 25 August 2023.
- [12]Ms Briscoe and Ms Matthau appeared on behalf of that the applicant. Mr Lovell, a lawyer, sought leave to appear on behalf of the respondent.
Jurisdiction
- [13]At the outset, Mr Lovell challenged the jurisdiction of the Tribunal to hear and decide the proceeding, relying on the decision of the Appeal Tribunal in Cameron Family Trust v Applikote Gold Coast Pty Ltd[6]. In the circumstances, the proceeding was adjourned, without hearing evidence, with directions given for the filing and service of submissions on jurisdiction and a decision on jurisdiction on the papers.
Submissions
Respondent’s submissions filed 1 September 2023
- [14]The respondent asserts the claim made by the applicant against him in the proceeding is not a claim for a debt or liquidated demand of money for four reasons. First, it is asserted, there is no basis for calculating or assessing the amount of the first invoice by reference to the engagement letter.
- [15]Secondly, the accountancy work described for two of the three tax years, in particular the accountancy work for 2018 and 2019, was expressly outside the scope of the engagement letter.
- [16]Thirdly, by the applicant’s own admission, it is asserted, aspects of the work described in the first invoice were not completed.
- [17]Fourthly, the respondent has deposed to delay, inaccuracies in the financial statements and the cost of retaining other accountants to prepare and lodge the taxation returns.
Affidavit of Mr Walsh and applicant’s submissions filed 8 September 2023
- [18]The applicant filed a second affidavit of Mr Walsh, affirmed by him on 7 September 2023. Exhibited to the affidavit is correspondence, the engagement letter, and the invoices. Mr Walsh deposes to the engagement of the applicant by the respondent[7], the work carried out[8], the calculation of the charges invoiced by the applicant[9], amendments to the financial statements and income tax returns[10], correspondence[11], and the provisions of the engagement letter providing for a late payment fee, interest, and indemnity[12].
- [19]The submissions assert the claim made by the applicant in the proceeding is a debt or liquidated demand of money and, hence, it is within the jurisdiction of the Tribunal. Cited in support of the assertion are decisions of the Appeal Tribunal in Financial Advisors Australia v Mooney & Anor[13], Hashfield v Gold Coast City Council[14], Hill v Berghofer[15] and Morales v Murray Lyons Solicitors (a firm)[16].
Respondent’s submissions in reply filed 15 September 2023
- [20]The respondent, on 15 September 2023, filed submissions in reply to the applicant’s submissions. In the submissions, the respondent, in summary, asserts Mr Walsh deposing to the calculation of the amounts invoiced does not “elevate” the claim to a claim for a debt or liquidated demand of money. It is again asserted the respondent did not request accountancy work for the financial years 2018 and 2019, and the cause of action is not for a debt or liquidated demand of money. In summary, it is asserted, Cameron Family Trust v Applikote Gold Coast Pty Ltd applies in the circumstances here and the proceeding must be dismissed for want of jurisdiction.
Discussion
Jurisdiction
- [21]The Tribunal has jurisdiction to hear and decide a minor civil dispute.[17] Minor civil dispute is defined in the dictionary in schedule 3 to the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act). Relevantly, the definition includes a “… a claim to recover a debt or liquidated demand of money of up to the prescribed amount …” Prescribed amount is defined in the schedule as $25,000.00.
- [22]The meaning of the term ‘debt or liquidated demand of money’ is not defined in the Act. It has, however, been considered by courts and tribunals on many occasions.
- [23]The history of the use of the term, and the meaning given it by the courts, is summarised by Sholl J in Alexander v Ajax Insurance Co Ltd[18]. He commences by referring to the definition given the term by Odgers, Pleadings and Practice, (12th ed.), 1939, pp 47 – 8, approved by Knox CJ and Starke J in Spain v The Union Steamship Co of New Zealand Ltd[19]:
… whenever the amount to which the plaintiff is entitled (if he is entitled to anything) can be ascertained by calculation or fixed by any scale of charges or other positive data, it is said to be liquidated or “made clear”. But an action in which the amount to be recovered depends upon all the circumstances of the case, and no one can say positively beforehand whether the plaintiff will recover a farthing, or forty shillings, or a hundred pounds, is an action for unliquidated damages.[20]
- [24]The term ‘debt or liquidated demand in money’, his Honour suggests, comes from the First Report of the Common Law Commissioners, 1851, p 38, and Appendix A, p 70. It was used in the context of litigated or contested cases as a percentage of writs issued.
- [25]After reviewing the authorities, his Honour, subject to inclusions and exclusions in the decided cases, adopted the following meaning of the term:
… any claim:
- for which the action of debt would lie;
- for which an indebitatus (or “common”) count would lie – including those cases formerly covered by the quantum meruit or quantum valebat counts, notwithstanding that the only agreement implied between the parties in such cases was for payment at a “reasonable” rate;
- for which covenant, or special assumpsit, would lie, provided that the claim was for a specific amount, not involving in the calculation thereof elements the selection whereof was dependent on the opinion of a jury.[21]
- [26]The history of the use and meaning of the term gives context to its use and meaning in the QCAT Act. The preferred meaning, however, and that to be adopted, is the meaning given the term by the many decisions of the Tribunal, both at first instance and on appeal.
- [27]In Hill v Berghofer[22], the then President of the Tribunal, Wilson J, citing Spain v The Union Steamship Co of New Zealand Ltd, said:
A ‘debt or liquidated demand’ is, as the Deputy President explained in Ziegeler t/as Ziegco Pty Ltd v Recochem Incorporated, one where the amount is determined and, in effect, beyond dispute as to how it is calculated. If the amount depends upon assessment by the court or tribunal, it is not liquidated.[23] (Citations omitted)
- [28]The Appeal Tribunal, in Hashfield v Gold Coast City Council[24], after referring to the decision of Sholl J in Alexander v Ajax Insurance Co Ltd and the Tribunal’s Practice Direction 9 of 2010, adopted the meaning of the term given it by Wilson J in Hill v Berghofer. The Practice Direction referred to provides for default decisions for unliquidated damages. In a footnote to the term ‘unliquidated damages’, it is said such claims arise:
… when a claim is made for a sum which cannot be determined without consideration, by the Tribunal, of the applicant’s evidence in support of the claim – for example, a claim in which the precise amount which should be awarded cannot be determined from the terms of a prior agreement between the parties, or some other standard; and must be calculated by reference to invoices, quotations or the like.
- [29]In Spannys Whitsunday Real Estate v Proserpine Youth Club Inc[25], in addressing the question “Was there a claim to recover a debt or liquidated demand of money of up to the prescribed amount?”, the Tribunal summarised the relevant principles, at [39] – [42], in the following terms:
[39] It is the nature of the claim, rather than its prospects of success, that determines jurisdiction; the claim must in law be a debt or liquidated demand, merely claiming a specific amount is not conclusive.
[40] Even if a plaintiff (an applicant) frames as a liquidated demand a claim which is not of that kind and manages to obtain judgment by default for the whole amount claimed, the judgment will be regarded as irregularly obtained and will be set aside.
[41] A ‘debt’ has been described as ‘a liquidated sum in money presently due, owing and payable by a person, called the debtor, to another person called the creditor’.
[42] A claim is a ‘liquidated demand’ ‘... whenever the amount to which the plaintiff is entitled ... can be ascertained by calculation or fixed by any scale of charges, or other positive data’ or if it ‘does not require any exercise of judicial fact-finding or discretion to crystallise it or to arrive at a definite finding of quantum’. Examples of a liquidated demand include claims known as ‘quantum meruit’ or ‘quantum valebat’ claims.
(Citations omitted)
- [30]The respondent, as I have said, relies on the decision of the Appeal Tribunal in Cameron Family Trust v Applikote Gold Coast Pty Ltd for support the Tribunal is without jurisdiction to hear and decide the proceeding. The case concerned a claim by the applicant for management services. The agreement between the parties provided for payment fortnightly on presentation of an invoice.
- [31]It appears from the decision the respondent challenged the basis on which the two unpaid invoices the subject of the claim were issued. In so doing, the Appeal Tribunal held, the respondent:
... changed the nature of the dispute from a claim for debt to a claim for breach of contract. The tribunal clearly acknowledged the change in the nature of the claim, suggesting that [the applicant’s] claim was, in fact, a claim in the quantum meruit.[26]
- [32]To the extent revealed by the material filed in the Tribunal, and without the benefit of oral evidence, the facts in Cameron Family Trust v Applikote Gold Coast Pty Ltd are distinguishable from the facts here. The fees invoiced by the applicant to the respondent were calculated in accordance with the provisions of the engagement letter. Adopting what was said by Wilson J in Hill v Berghofer, the fees are determined and, in effect, beyond dispute as to how they are calculated. The claim made by the applicant may be determined from the terms of the engagement letter and is calculated by reference to the invoices.
- [33]The gravamen of the respondent’s response to the claim, as presently formulated, is that the applicant carried out work not authorised by the respondent and the applicant failed to lodge income tax returns. They are not matters changing the nature of the claim made so as to deprive the Tribunal of jurisdiction to hear and decide the proceeding.
- [34]On the material presently filed, the Tribunal has jurisdiction.
Representation
- [35]The parties have made application to the Tribunal for leave to be the represented in the proceeding, the applicant by an employee and the respondent by lawyers. The submissions on the jurisdiction of that the Tribunal to hear and decide the proceeding, and the other material, filed in that the Tribunal were prepared by lawyers for the parties.
- [36]The starting point in relation to representation is parties represent themselves unless the interests of justice require otherwise.[27] The Tribunal has a discretion to give a party leave to be represented.[28] In deciding whether to do so, the Tribunal may consider the circumstances set out in section 43(3) of the QCAT Act. Those circumstances include the proceeding is likely to involve complex questions of fact or law. The list of circumstances is not exhaustive.
- [37]The application by the applicant for leave to be represented is to be represented by an employee of the applicant. The person is not a lawyer.
- [38]The applicant is a company and, hence, must be represented at the hearing of the proceeding. The application to be represented by Ms Matheou is granted.
- [39]The respondent, in submissions filed with the application for leave to be represented, refers to section 43(3) of the Act and cites the decision of the Appeal Tribunal in Cello Court Pty Ltd v Body Corporate for Cello Court CTS 42339[29]. Contrary to the submission made, the learned Senior Member did not consider the matters set out in paragraph 4 of the submissions to be “... relevant in considering the interests of justice ...”; the respondent submitted they were relevant.
- [40]The respondent submits the material filed shows the proceeding is likely to involve complex questions of fact and law. I disagree.
- [41]The issues to be decided by the Tribunal, on the material filed to date, as I have said, are, first, did the respondent authorise the work for the financial years 2018 and 2019, and, secondly, did the applicant fail to carry out work? Those issues are unlikely to involve complex questions of fact or law.
- [42]The application by the respondent for leave to be represented is refused.
- [43]It is to be observed the parties have already incurred significant legal costs; it might be said out of proportion to the claim. The incurring of significant legal costs is contrary to one of the objects of the QCAT Act, to have the Tribunal deal with matters in a way that is economical[30], and the Tribunal’s function to ensure proceedings are conducted in an informal way that minimises costs to parties[31].
Decision
- [44]It is appropriate that directions be given for the filing of any additional material by the parties. The orders of the Tribunal are:
- 1.The application by the respondent to dismiss the proceeding on the ground the Tribunal is without jurisdiction to hear and decide the proceeding is dismissed.
- 2.The application by the applicant filed 24 August 2023 for leave to be represented in the proceeding by Ms Matheou is granted.
- 3.The application by the respondent filed 15 September 2023 for leave to be represented in the proceeding by a lawyer is refused.
- 4.The applicant, by 4.00pm on 13 November 2023, file and serve on the respondent by email any additional material on which it intends to rely at the hearing of the proceeding.
- 5.The respondent, by 4.00pm on 27 November 2023, file and serve on the applicant by email any additional material on which he intends to rely at the hearing of the proceeding.
- 6.The parties may not rely on material at the hearing of the proceeding other than material already filed or filed in accordance with this order without the leave of the Tribunal.
- 7.The parties have available at the hearing of the proceeding a hard copy of an indexed and paginated book of the documents on which they intend to rely at the hearing of the proceeding.
- 8.The proceeding be fixed for hearing on the next available hearing date after 27 November 2023.
- 9.This order be served on the parties by email.
Footnotes
[1] Paragraphs 3 – 7 of Mr Walsh’s affidavit.
[2] Paragraphs 8 – 18 of Mr Walsh’s affidavit.
[3] Paragraphs 19 – 26 of Mr Walsh’s affidavit.
[4] Paragraphs 27 – 30 of Mr Walsh’s affidavit.
[5] Paragraph 31 of Mr Walsh’s affidavit.
[6] [2022] QCATA 36.
[7] Paragraphs 3 – 7 of Mr Walsh’s second affidavit.
[8] Paragraphs 8 – 12 of Mr Walsh’s second affidavit.
[9] Paragraphs 13 – 22 of Mr Walsh’s second affidavit.
[10] Paragraphs 23 – 26 of Mr Walsh’s second affidavit.
[11] Paragraphs 27 – 35 of Mr Walsh’s second affidavit.
[12] Paragraphs 36 – 39 of Mr Walsh’s second affidavit.
[13] [2016] QCATA 181, per Carmody J at [12].
[14] [2020] QCATA 36.
[15] [2011] QCATA 34, per Wilson J at [7].
[16] [2010] QCATA 87.
[17] Section 11 of the QCAT Act.
[18] [1956] VicLaw Rp 5, [1956] VLR 436.
[19] (1923) 32 CLR 138, at 142.
[20] Ibid, at 440.
[21] Ibid, at 445.
[22] [2011] QCATA 34.
[23] Ibid, at [7].
[24] (supra), at [45].
[25] [2023] QCAT 171.
[26] Ibid, at [6].
[27] Section 43(1) of the QCAT Act.
[28] Section 43(2)(b)(iv) of the QCAT Act.
[29] [2021] QCATA 62.
[30] Section 3(b) of the QCAT Act.
[31] Section 4(c) of the QCAT Act.