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MFP Australia Pty Ltd v Luland Family Pty Ltd ATF the Luland Family Trust t/as East Coast Tyre & Auto NSW[2022] QCATA 59

MFP Australia Pty Ltd v Luland Family Pty Ltd ATF the Luland Family Trust t/as East Coast Tyre & Auto NSW[2022] QCATA 59

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

CITATION:

MFP Australia Pty Ltd v Luland Family Pty Ltd ATF the Luland Family Trust t/as East Coast Tyre & Auto NSW [2022] QCATA 059

PARTIES:

MFP Australia Pty ltd

(appellant)

v

Luland Family Pty Ltd ATF The Luland Family Trust t/as East Coast Tyre & Auto NSW

(respondent)

APPLICATION NO/S:

APL076-21 and APL077-21

ORIGINATING APPLICATION NO/S:

MCDO50762/20 and MCDO50158/21 (Southport)

MATTER TYPE:

Appeals

DELIVERED ON:

4 May 2022

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Member Gordon

ORDERS:

Leave to appeal is refused.  This means the appeal fails.

CATCHWORDS:

APPEAL AND NEW TRIAL – PROCEDURE – QUEENSLAND – WHEN NO APPEAL LIES – where an Adjudicator found that the respondent was not a party to the relevant contracts – where the appellant contends that there was evidence showing that this finding was incorrect – whether reasonably arguable in this appeal

Corporations Act 2001 (Cth), s 126, s 128, s 129

Air Tahiti Nui Pty Limited v McKenzie [2009] NSWCA 429

Elliotts v Cross [1994] QCA 360

Lederberger v Mediterranean Olives Financial Pty Ltd [2012] VSCA 262

APPEARANCES &

REPRESENTATION:

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

REASONS FOR DECISION

  1. [1]
    This is an appeal brought by MFP Australia Pty Ltd which is about the correct contracting party.  MFP is in business in Queensland designing and manufacturing supercharger kits and custom automotive parts.[1]  The respondent is Luland Family Pty Ltd ATF the Luland Family Trust t/as East Coast Tyre & Auto NSW.  Its business is in New South Wales repairing motor vehicles and selling after-market motor vehicle goods such as tyres and wheels. 
  2. [2]
    MFP brought a claim against the respondent in the tribunal seeking payment of invoices for work that it had done on two vehicles.  The claim was for a total of $23,426 plus interest and various formal charges, brought in two separate applications.[2]  The work involved supply and fitting of various parts, provision of a workshop for other trades, collection and delivery of vehicles and storage charges.  A second invoice which had been partially paid, was for the supply of various parts.
  3. [3]
    In formal responses to the claim, the respondent said that it was not the contracting party, and that all the work in the invoices was done for Brett Luland who owned the two vehicles concerned, and he was the contracting party.  It was also said that the work done by MFP was defective, which is why the invoices were not paid.  Affidavit evidence was filed including an affidavit made by Brett Luland himself, supporting what was said in the responses.[3]
  4. [4]
    Instead of seeking to join Brett Luland to the claim, MFP allowed the matter to proceed to a hearing against the respondent alone.  The claim was heard by a tribunal Adjudicator.  At the hearing, MFP was represented by its sole director Matthew Coates.  As a preliminary issue, the Adjudicator had to decide whether or not the respondent was party to the relevant contracts.
  5. [5]
    The evidence before the Adjudicator about this came from affidavits from the individuals concerned, and from their oral evidence in the hearings, and from the documents in the file or exhibited to the affidavits. 
  6. [6]
    In a careful oral decision giving reasons, the Adjudicator recited the relevant parts of the evidence and concluded that the respondent was correct in its contention that it was not the contracting party. 
  7. [7]
    In this appeal, it is said that the following are uncontroverted facts and that they should have persuaded the Adjudicator that the respondent was the contracting party because they showed that Brett Luland was acting as agent for the respondent with respect to the relevant contracts.  Helpfully, in its submissions, the respondent has identified the evidence given in support of these assertions:
    1. (a)
      Brett Luland was the respondent’s shop manager.[4]
    2. (b)
      Brett Luland’s father, Steve Luland, was a director of the respondent company.[5]
    3. (c)
      The respondent had permitted Brett Luland to use its email address.[6]
    4. (d)
      The respondent had paid invoices addressed to it for similar related works which were part of the same project.
    5. (e)
      On two occasions in his father Steve Luland’s presence Brett Luland told the director of MFP to invoice the respondent for the works done.[7]
    6. (f)
      MFP owed the respondent a significant amount for tyres and the respondent permitted MFP to set this debt off from a sum due for similar related works which were part of the same project.[8]
  8. [8]
    The reasons given by the Adjudicator demonstrate that all these assertions were recognised and understood.  It is not suggested otherwise in this appeal.  One difficulty in the appeal is that the assertions are not all undisputed as MFP contends.
  9. [9]
    The Adjudicator’s decision needs to be understood given the agreed factual matrix. 
  10. [10]
    The respondent had a sole director and secretary, Steven Luland, and he was also the only shareholder. 
  11. [11]
    Steven Luland’s son, Brett Luland, was employed as shop manager for the respondent,[9] and MFP communicated with Brett Luland whilst he was working there and he used the respondent’s email address.  Steve Luland’s evidence was that it was common for the respondent’s employees to us their work email address for private purposes such as to receive invoices or correspondence.[10]
  12. [12]
    All communication as to the work to be done on the vehicles concerned and the progress of the work, and all instructions about the work, came from Brett Luland.  No such communication or instruction came from anyone else in the respondent’s organisation and certainly not from its director Steve Luland.[11] 
  13. [13]
    Mr Coates knew that Brett Luland was an enthusiast in Ford high performance motor vehicles and that he was owner of the two vehicles involved.[12]  This meant that as owner of the vehicles it would be more likely that Brett Luland would engage MFP to work on the vehicles in his personal capacity than on behalf of the respondent. 
  14. [14]
    Mr Coates says that Steve Luland came with his son Brett Luland to deliver one of the vehicles to MFP’s premises and to collect it back after the work had been done.[13]  This would be a natural thing to happen when delivering and collecting vehicles.  Mr Coates also describes meeting Steve Luland on other occasions, and that they developed a ‘fairly close discussion type friendship’ but there is nothing which assists to identify the correct contracting party with respect to the vehicles concerned.[14]
  15. [15]
    In giving reasons, the Adjudicator thought that Brett Luland had more influence with the respondent than his evidence disclosed, but that Mr Coates knew or ought to have known that Steve Luland had the true authority to act for the respondent and that Brett Luland had no particular authority.  The Adjudicator said that this knowledge came from Mr Coates’ personal dealings with them and his knowledge that Steve Luland and not Brett Luland was the director of the respondent.[15]
  16. [16]
    Assertion (d) (respondent having paid earlier invoices) might suggest that the respondent was the contracting party but it is also explicable by internal arrangements between Brett Luland and the respondent in a small company of this sort which acts as a trustee for a family trust.  It is certainly not conclusive.  For example in Elliotts v Cross,[16] an earlier invoice was addressed to named individuals and to a company and the plaintiff was aware that the invoices had been paid out of company funds.  But in the light of the course of dealing between the parties, this did not mean that subsequent work was done with the company as a contracting party.
  17. [17]
    Assertion (e) (Brett Luland in front of his father requesting MFP’s invoices to be sent to the respondent) was disputed by both Brett and Steve Luland[17] as the Adjudicator pointed out in the reasons,[18] and the Adjudicator noted there was no evidence that Steve Luland had ever requested invoices to be issued to the respondent,[19] that the fact that Steve Luland did not object to invoices being issued to the respondent was not evidence that he acquiesced to this being done.[20] 
  18. [18]
    Assertion (f) (set-off from MFP’s invoice of respondent’s debt) was also disputed by both Brett and Steve Luland.[21]  The Adjudicator dealt with this in the reasons, pointing out that the invoice on which the set off was applied was one addressed to Brett Luland personally, so that there may have been ‘some loose arrangement on at least that one occasion’.[22]  But the Adjudicator found there was no such set off on other occasions relied on by MFP when this was alleged to have happened.[23]
  19. [19]
    Overall, the Adjudicator decided that there was no evidence that Steve Luland had led MFP to believe that the contracts were made with the respondent.[24]  Accordingly there was insufficient evidence for the respondent to be liable for the invoices.[25] 

Was the correct test applied?

  1. [20]
    The test for who is a contractual party is an objective one.[26]  Mr Coates may have demonstrated in his evidence that he truly believed that he was contracting with the respondent, but this is insufficient.  He needs to show that this was a reasonable belief in all the circumstances.  This was explained in Lederberger v Mediterranean Olives Financial Pty Ltd as follows:[27]

Identification of the parties to a contract must be in accordance with the objective theory of contract.  That is the intention that a reasonable person, with the knowledge of the words and actions of the parties communicated to each other, and the knowledge that the parties had of the surrounding circumstances, would conclude that the parties had.  The process of construction requires consideration not only of the text of the documents, but also the surrounding circumstances known to the parties and the purpose and object of the transaction.  This in turn presupposes knowledge of the genesis of the transaction, the background, and the context in which the parties are operating.

citations omitted

  1. [21]
    Being a company, the respondent would necessarily act through an individual as its agent.  It is provided by statute that a company may make a contract through such an individual acting with the company’s express or implied authority.[28]  Here the Adjudicator referred to actual authority but clearly considered that it did not apply in this particular case.[29]  It is not suggested in this appeal that the Adjudicator was wrong to take that view or that the Adjudicator should have inferred that Brett Luland had such express or actual authority in the circumstances (that is, implied authority).
  2. [22]
    Instead, the Adjudicator concentrated on the principle of apparent or ostensible authority.  In doing so the Adjudicator explained that for the claim to succeed it was necessary that the principal (the respondent) led MFP to believe that the agent was authorised to act on its behalf in making the contracts.[30]  It is common ground between the parties that this was the correct test.
  3. [23]
    In passing I would point out that there are statutory provisions in sections 128 and 129 of the Corporations Act 2001 (Cth) which state when a person is entitled to make assumptions about the ostensible authority of a person who is not a director but who is held out by the company to be its officer or agent.  A person is entitled to assume that the person so held out ‘has authority to exercise the powers and perform the duties customarily exercised or performed by that kind of officer or agent of a similar company’.[31]  Under these provisions it is clear that a person would be entitled to assume that the company’s shop manager would have authority to bind the company when commissioning work for its customers.  But this would not apply to the shop manager’s own vehicle so the statutory provisions do not assist in this particular case.
  4. [24]
    It is clear that the Adjudicator applied the correct tests when considering the identity of the party making the relevant contracts, and applied the relevant facts to those tests, and so made no error of law in those respects.
  5. [25]
    On that basis, it is clear that the finding that the respondent was not a party to the relevant contracts was open to the Adjudicator.  As such it is not a finding which can be disturbed on appeal.

Conclusion

  1. [26]
    In these types of appeal, leave to appeal is necessary.  Leave to appeal will only be given if the appeal is reasonably arguable or if there is another good reason to give leave to appeal.  In this appeal none of the grounds of appeal are reasonably arguable and there is no other good reason to grant leave so I refuse it.  The appeal therefore fails.

Footnotes

[1]Affidavit of Matthew Coates made on 4 September 2020, [9].

[2]As second application was required because the first application pre-dated one of the invoices.

[3]Affidavits of Brett Luland made on 30 September 2020, [9], [103], [106], and of Steve Luland made on 30 September 2020, [5]-[14].

[4]Transcript 1-22 line 13.

[5]Affidavit of Brett Luland made on 30 September 2020, [1].

[6]Affidavit of M Coates made on 4 September 2020, [22]-[23].

[7]Affidavit of M Coates made on 4 September 2020, [41], [96].

[8]Affidavit of M Coates made on 4 September 2020, [107]-[110] and MJC10.

[9]Affidavit of Brett Luland made on 30 September 2020, [3].

[10]Affidavit of Steven Luland made on 30 September 2020, [8].

[11]This can be seen generally from the affidavit of Matthew Coates made on 4 September 2020.

[12]Affidavit of Matthew Coates made on 4 September 2020, [14], [17], [67].

[13]Affidavit of Matthew Coates made on 4 September 2020, [40], [60].

[14]Affidavit of Matthew Coates made on 6 November 2020, [8].

[15]Transcript 1-22 line 15 to 25.

[16][1994] QCA 360.

[17]Affidavit of Brett Luland made on 30 September 2020, [18], [107]-[109].  Affidavit of Steve Luland made on 30 September 2020, [12].

[18]Transcript 1-20 line 24.

[19]Transcript 1-21 line 12.

[20]Transcript 1-21 line 13.

[21]Affidavit of Brett Luland made on 30 September 2020, [15].  Affidavit of Steve Luland made on 30 September 2020, [15]-[17].

[22]Transcript 1-21 line 32.

[23]Transcript 1-21 line 34.

[24]Transcript 1-21 line 22.

[25]Transcript 1-22 line 2.

[26]Air Tahiti Nui Pty Limited v McKenzie [2009] NSWCA 429, [28].

[27][2012] VSCA 262, [19], by Nettle and Redlich JJA and Beach AJA.

[28]Section 126 of the Corporations Act 2001 (Cth).

[29]Transcript 1-19 line 39.

[30]Transcript 1-19 line 44, 1-20 line 11.

[31]Section 129(3).

Close

Editorial Notes

  • Published Case Name:

    MFP Australia Pty Ltd v Luland Family Pty Ltd ATF the Luland Family Trust t/as East Coast Tyre & Auto NSW

  • Shortened Case Name:

    MFP Australia Pty Ltd v Luland Family Pty Ltd ATF the Luland Family Trust t/as East Coast Tyre & Auto NSW

  • MNC:

    [2022] QCATA 59

  • Court:

    QCATA

  • Judge(s):

    Member Gordon

  • Date:

    04 May 2022

Appeal Status

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

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