Anderton v Parks Horticultural Services Pty Ltd
[1996] QDC 281
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- Anderton v Parks Horticultural Services Pty Ltd[1996] QDC 281
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Anderton v Parks Horticultural Services Pty Ltd[1996] QDC 281
Anderton v Parks Horticultural Services Pty Ltd[1996] QDC 281
IN THE DISTRICT COURT HELD AT BRISBANE QUEENSLAND | No. OS 2790 of 1996 |
IN THE MATTER of THE QUEENSLAND BUILDING SERVICES AUTHORITY ACT (1991) SECTION 94
AND:
IN THE MATTER of an Appeal
BETWEEN:
KENNETH JOHN ANDERTON and CHRISTINE ANN ANDERTON | Appellants |
AND:
PARKS HORTICULTURAL SERVICES PTY LTD | Respondent |
REASONS FOR JUDGMENT - McGILL DCJ
Delivered the 11th day of October 1996
This is an appeal from a determination of the Queensland Building Tribunal by the applicants in the proceedings before the Tribunal. Leave to appeal was given pursuant to s. 94(1) of the Queensland Building Services Authority Act (1991) (“the Act”) by Morley DCJ on 24 July 1996. The determination was that the Tribunal had no jurisdiction to grant the orders sought in para. 17 of points of claim dated 28 April 1995 delivered on be half of the applicants pursuant to a direction of the Tribunal. The issue on the appeal was whether the Tribunal did have such jurisdiction.
It appears from the decision of the Tribunal that the appellants are owners of a home at Greenslopes where in Jury 1993 they began to carry out substantial renovations. On or about 5 November 1993 they entered into a written contract with the respondent to carry out some landscaping work for a lump sum, but on 9 December 1993 the parties agreed to replace the written contract with an oral agreement for the respondent to carry out the work at cost plus 15 percent In April 1994 the respondent submitted a series of invoices totalling almost $253,000 as the amount payable pursuant to that agreement, of which a little over half had already been paid. The appellants raised certain areas of concern in relation to the claim, and a meeting was held on 30 June 1994 at which an agreement was reached that the appellants pay a sum of $95,000 by way of final payment for the work, and the respondent would carry out certain rectification work. The sum of $95,000 was paid on 4 July 1994, and some rectification work was carried out pursuant to the agreement. There was at one the a dispute about whether that work had been carried out adequately, but prior to the hearing before the Tribunal that dispute had been resolved between the parries.
On 8 November 1994 the appellants lodged an Application to Commence Proceedings in the Queensland Building Tribunal by completing a form. The front of the form indicated that the applicants were seeking “compensation for loss”, and on the dispute schedule the following details were given in the column “what the applicant is seeking”:
- “1.Compensation for the excessive increase in costs of landscaping works at 18 Barradine Street Greenslopes caused by:
- 1.incompetence of contractor (Parks Horticultural Services);
- 2.excessive time taken to complete the project;
- 3.non-disclosure of cost increases;
- 4.unreasonable increases in some costs;
- 5.misleading statements in contract documents;
- 6.false invoicing;
- 7.lack of value in works related to costs;
- 2.Compensation for poor quality of workmanship.”
What followed appears from the decision of Ms E M O'Reilly, a member of the Tribunal, dated 13 April 1995. The respondent alleged that the dispute had been settled by the agreement on 30 June 1994. The Tribunal at a directions hearing fixed a date for hearing of the issue as to jurisdiction, but it appears to have become common ground between the parties on that occasion that it was necessary for the matter to go to a full hearing before the jurisdictional issue could be resolved, and directions to that end were agreed.
Pursuant to those directions the appellants delivered the points of claim dated 28 April 1995. That document refers to the oral contract of 9 December 1993, and the dispute which arose in relation to payment under it, and alleges that on 30 June 1994 the parties “purported to come to an agreement that the dispute between them would be settled” on the basis already indicated. The points of claim do not in terms dispute that the parties purported to settle, ie compromise, the dispute between them, but allege that the compromise was “voidable” on three grounds:
- a)The absence of a bona fide and honest claim on the part of the respondent to be compromised;
- b)Unilateral mistake on the part of the appellants as to the honesty and bona fide of the respondent's claim, and the respondent's entitlement to be paid consideration for work carried out;
- c)False and fundamental assumption by both parties as to the respondent's entitlement to be paid consideration for the work carried out.
The basis of the third and part of the second of these lies in the fact that at the relevant time the respondent did not hold a contractor's licence of the class appropriate to the work under the Act, and accordingly by s. 42(3) of the Act was “not entitled to any monetary or other consideration for doing [the work]”.
The applicants in the alternative sought the exercise by the Tribunal of its power under s. 95(4)(d) to “avoid any unjust contractual term, or otherwise vary a contract to avoid injustice” by avoiding or varying the settlement agreement of 30 June 1994; this claim presupposes that the agreement is otherwise valid. The applicants went on to claim restitution of the amount by which the monies paid by them exceeded a fair and reasonable remuneration for the work carried out by the respondent.
There was an alternative claim for damages for breach of an implied term of the agreement of 9 December 1993 to carry out the work under the contract with “the care and skill of a competent landscaping contractor”. There was also a claim in respect of defects still in the work as completed; the points of claim do not make clear whether this claim is based on the agreement of 9 December 1993 or of 30 June 1994, but the document as a whole suggests that it is based on the former.
The defence and counter-claim of the respondent dated 22 May 1995 admitted that prior to 30 June 1994 there was a dispute between the appellants and the respondent arising out of the agreement of 9 December 1993, although it raised a dispute as to the terms of that agreement. The agreement of 30 June 1994 was relied on as a settlement of the dispute, and the appellants' entitlement to avoid the agreement was denied. The existence of the implied term in the agreement of 9 December 1993 was admitted, but breach of it was denied, as was the existence of defects in the work as completed. The counter-claim was predicated on the agreement of 30 June 1994 being set aside; in those circumstances the respondent reverted to its claim to be entitled to just under $253,000 pursuant to the agreement of 9 December 1993, and claimed the balance. An answer dated 22 May 1995 was delivered.
The matter went to a full hearing occupying, I was told, some 15 days before Ms Burke, a member of the Tribunal, who on 17 June 1996 found that the Tribunal had no jurisdiction to grant the orders sought. The essential conclusion on which this decision was based is that appearing on p. 11 of the reasons:
“In this case the compromise agreement is the contract from which the dispute between the parties has arisen. The compromise agreement is not a contract for the performance of domestic building work. In those circumstances, therefore, I am of the view that the Tribunal does not have jurisdiction to determine the dispute arising in relation to the compromise agreement.”
The Tribunal nevertheless went on to consider various other matters in case that decision was wrong. One of the matters considered was whether there was jurisdiction to vary the settlement agreement under s. 95(4). At p. 35 Ms Burke concluded that the compromise agreement was not a contract to which s. 95(4)(d) was applicable, that power being exercisable only with respect to a contract for the performance of domestic building work.
It appears never to have been in dispute, and it was not in dispute before me, that (subject to the consideration said to make the agreement voidable) the parties did on 30 June 1994 purport to settle the dispute which they then had in relation to the carrying out of the work. Counsel for the appellants conceded that they sought relief in the Tribunal concerning the compromise agreement that had been concluded, but alleged that the dispute as to the compromise agreement was one falling within para. (a) of the definition of “domestic building dispute” in s. 4 of the Act:
“A claim or dispute arising between a consumer and a building contractor in relation to the performance of domestic building work or a contract for the performance of domestic building work.”
It was argued that the matters said to give rise to the exercise of the Tribunal's discretion to grant the relief sought concerned the manner in which the domestic building work had been carried out, and the matters relied on the basis for alleging that the compromise agreement was voidable were also directly connected with the contract for the performance of the work, that is the contract of 9 December 1993.
I find this a difficult argument to accept. Although the words “in relation to” are potentially of wide import, where they are used in defining the jurisdiction of a specialised tribunal it is appropriate to confine them to a fairly direct relationship. In O'Grady v. the Northern Queensland Company Ltd (1990) 169 CLR 356 the High Court had to consider s. 80(1) of the Mining Act 1968 which conferred on a warden's court exclusive jurisdiction in all actions “arising in relation to mining or to any mining tenement”. The plaintiff in a Supreme Court action claimed a declaration that a joint venture agreement for the conduct of mining operations on a mining lease had been determined, and the company counter-claimed for a declaration that the plaintiff's purported rescission of the agreement was invalid, and to enforce part of the agreement. It was held by a majority of the High Court that the counter-claim was not a matter within the exclusive jurisdiction of the wardens court under the passage quoted, or under an express conferral of jurisdiction “with respect to ... (g) any matter arising between miners in relation to mining on Crown land ...”. Toohey and Gaudron JJ, two of the majority judges, at p. 374 said:
“Although ‘in relation to’ is an expression of broad import, in context with ‘arising’ it presupposes a direct connection between a presently existing action, suit or proceeding and mining or a mining tenement, not merely an indirect connection.”
Dawson J at p. 367 expressed agreement with their Honours, and added that:
“What is required is a relevant relationship, having regard to the scope of the Act. Where jurisdiction is dependent upon the relation with some matter or thing, something more than a coincidental or mere connection - something in the nature of a relevant relationship - is necessary.”
This is consistent with the approach to the definition of “domestic building dispute” adopted by McLarchlan DCJ in Murgia v. Sablewell Pty Ltd (Plaint A128 of 1995, 27/7/95, unreported), although the aspect of the definition which his Honour there construed is different from the one I have to consider.
Accordingly in my opinion a dispute between the parties to a settlement agreement about that agreement is not one within para. (a) of the definition of “domestic building dispute” merely because the dispute settled by the agreement was within that definition, or because it would be necessary to have regard to matters which occurred in the course of that earlier dispute, or in the performance of domestic building work, in order to resolve the dispute.
Strictly speaking, however, in my opinion it is not necessary for me to decide that point, since in my opinion if the nature of the proceedings before the Tribunal is properly analysed the Tribunal had jurisdiction to deal with the dispute before it. In my opinion the Tribunal had before it a dispute arising in relation to a contract for the performance of domestic building work, being the work undertaken by the respondent pursuant to the contract of 9 December 1993.
The respondent argued that the landscaping work undertaken pursuant to that contract was not within the definition of “building work” and therefore could not be “domestic building work”. The Tribunal at pp. 1-2 found that the appellants carried out substantial renovations to their home and that these renovations included extensive landscaping work, including adjusting levels to match newly constructed areas of the house, construction of a driveway (no doubt to the garage which was erected), retaining walls, laying of sandstone to the front lobby, courtyard areas, slate tiling to new balcony area, construction of footings, side walls and drainage of atrium to newly constructed lobby, and other work less directly related to the work done on the house itself. I infer that all or most of this was included in the work undertaken by the respondent The definition of “bulling work” in s. 4 of the Act includes:
- “(b)The renovation, alteration, extension, improvement or repair of a building, or....
- (e)Any site work (including the construction of retaining structures) related to work of a kind referred to above....”.
In my opinion the work done was site work, and in view of the findings above was related to the renovations undertaken to the house, or extensions to it. It was therefore building work as defined. Indeed, I would hope that the carrying out of $250,000 worth of landscaping around a house, or even $150,000 worth, would amount to an improvement of the house. This argument of the respondent must he rejected.
It seems to me that the way in which the matter proceeded in the Tribunal has served to obscure somewhat the fact that the dispute I have identified was the foundation of the proceedings. It is true that the first claim made in para. 17 of the points of claim was an order setting aside or avoiding or varying the purported agreement of 30 June 1994, and the order in para. 17(b) does appear to be dependent upon that. However the relief claimed in para. 17(c), as appears from paras. 12, 13 and 14, is not relief which is directly dependent upon some order being made in respect of the settlement agreement, in that such setting aside is not part of the cause of action relied on.
The position in substance seems to me this: The appellants claimed that they had been overcharged for the work done under the contract, as a result of various breaches of that contract, and that in some respects the work done under the contract was defective (although that part of the claim was subsequently compromised). The respondent then raised the settlement agreement by way of defence, and that meant that the appellants had to face that issue in some way otherwise their claim would fail.
To deny on the ground of prior compromise a claim to relief in relation to the performance of domestic building work, or in relation to a contract for the performance of domestic building work, produces a dispute in relation to those matters, just as the denial of the claim on any other basis produces such a dispute.
The appellents sought to face the defence by saying that the settlement agreement was “voidable” on various grounds, or alternatively ought to be varied or set aside by the Tribunal so as not to impede their claim for relief based on breach of the original contract.
This was not a case where the appellants were seeking to enforce the settlement agreement, or seeking damages for breach of it. Rather the respondent was seeking to rely on the settlement agreement by way of defence, and the appellants' attacks on the settlement agreement were in substance by way of reply. The original application to the Tribunal clearly made a “claim ... in relation to the performance of domestic building work or a contract for the performance of domestic building work” so the jurisdiction of the Tribunal was validly engaged. Although other mailers in issue arose between the parties, that original claim never went away. To the extent that the claim became one to set aside the compromise agreement, that was so as to enable the original claim to be pursued.
Furthermore, insofaras the appellants were alleging that there was no bona fide claim to an entitlement to the amount originally claimed, or that the respondent was not entitled to recover that or indeed any amount because of s. 42 of the Act, they were alleging an absence of consideration for the settlement agreement, and if that were made out it would make the settlement agreement void rather than voidable. The absence of a bona fide claim would prevent any contract of compromise arising, because giving up a baseless claim could not amount to consideration for the promise by the other party Foskett, “The Law and Practice of Compromise” (Sweet & Maxwell, 3rd ed. 1991) p. 15. As to the claim based on the absence of a licence and s. 42 of the Act, in my opinion if the settlement agreement was otherwise valid, the tact that one party had entered into it under a mistake as to the validity of the claim compromised would not affect its validity, it would raider it neither void nor voidable: David Securities Pty Ltd v. Commonwealth Bank of Australia (1992) 175 CLR 353 at 395.
However, even if the applicants were seeking relief which were based on the existence of the agreement of compromise (including relief in the form of the setting aside or varying of the agreement), so long as there was before the Tribunal a domestic building dispute the Tribunal has jurisdiction pursuant to s. 95(1) also to resolve “any other matters at issue between the parties”, ie the parties to the domestic building dispute. Even assuming, as seems to me to be reasonable, that the other matters would have to be ones associated with the domestic building dispute, in my opinion there would not need to be an especially close association between that part of the proceedings which constituted the domestic building dispute and any part which did not for the Tribunal to have jurisdiction to deal with it under this extended jurisdiction for s. 95(1).
Section 95(1) appears to have been deliberately framed in terms which permit the Tribunal, once there is a domestic building dispute between the parties to resolve all matters in issue between them. It would obviously be unsatisfactory if the Tribunal could deal with the domestic building dispute, but any other matters in dispute, possibly being matters arising out of the same facts or similar facts, could not be dealt with by the Tribunal, so that there had to be a second trial in a court before all matters could be resolved. Such a construction of s. 95 would be inconvenient, and not favour the objects of the Act as set out in s. 3, and the underlying intention of the statute as explained in Re Watpak Australia Pty Ltd [1996] 1 Qd.R. 229 at 231 per Williams J.
Accordingly in my opinion the Tribunal had jurisdiction to deal with this matter. The underlying or fundamental claim being advanced by the appellants was one in relation to the performance of domestic building work, or the contract for the performance of that work, or both, and the fact that the respondent raised by way of defence a compromise of the dispute, which compromise the appellants attacked in various ways, did not mean that the Tribunal did not have jurisdiction to determine the validity of the attacks upon the compromise. The position might have been different if there had no claim before the Tribunal based on the contract of 9 December 1993, or the work carried out pursuant to it, but that is unnecessary to deride. In my opinion the Tribunal did have jurisdiction to hear the whole matter which was before it. It follows that the appeal must be allowed.
The Tribunal went on to consider the appellants' claim on the assumption that the Tribunal did have jurisdiction to hear the matter. p. 12. The Tribunal made a finding resolving the dispute as to the terms of the contract of 9 December 1993, and found that the settlement agreement had been entered into on 30 June 1994. Then from p. 16 the member considered the question of whether the claim given up by the respondent on the compromise was an honest and bona fide claim, concluding that although there was an overcharge there was no gross overcharge and that the respondent had a genuine belief in its claim to the extent that it was one it was reasonably entitled to make.
The Tribunal next considered the effect of the absence of a licence and s. 42 of the Act. At p. 29 there was a finding that the respondent was not a holder of the requisite licence at the relevant time, and found that the respondent was aware that the absence of a licence had some effect on its ability to recover payment for the work, although declined to find that the respondent knew that it had no right to any payment for the work. It would have been an unduly confident respondent who would arrive at such a conclusion in the absence of any authoritative determination of the scope and operation of s. 42 of the Act. Earlier versions of that and similar provisions have not led to a situation where the contractor could not recover any payment for anything: in Fablo Pty Ltd v Bloor [1983] 1 Qd.R. 107 McPherson J held that s. 75 of the Builders Registration and Home Owners Protection Act 1979 which provided in effect that an unwritten building contract was not enforceable, did not affect a claim for moneys payable under an executed contract for the performance of house building work, which claim could be framed in debt or indebitatus assumpsit. A prohibition in s. 53(2)(e) of a person other than a registered builder being “entitled to recover by action in a court a fee or charge under a contract to perform bulling construction for another” was held not to prevent recovery of damages for loss arising from the other party's repudiated breach of contract: J C Scott Constructions v. Mermaid Waters Tavern Pty Ltd [1984] 2 Qd.R. 413 at 424-5. In Pavey and Matthews Pty Ltd v. Paul (1987) 162 CLR 221 the High Court held that a provision to similar effect to s. 75 of the 1979 Act did not prevent a builder from recovering on a quantum meruit, and the same has been held in relation to s. 75 in Gino D'Alessandro Constructions Pty Ltd v. Powis [1987] 2 QdR. 40. In Mostia Obstructions Pty Ltd v. Cox [1994] 2 Qd.R. 55 it was held by White J that s. 53(2)(d) of the 1979 Act permitted an unregistered builder to recover outlays incurred in the course of doing the work, but nothing by way of personal recompense. The wording of s. 42 is different from either of the provisions in the 1979 Act, and may well be wider in its operation. Nevertheless, in my opinion the matter is attended with sufficient doubt that a person could reasonably entertain as a bona fide claim one based on an entitlement to the contract price in indebitatus assumpsit, or an equivalent price in quantum meruit, with as a fall back position an entitlement to be reimbursed in respect of outlays. That is all that the respondent needed to show to establish good consideration for the compromise agreement. As indicated earlier, the mere fact that the appellants were unaware at the time of the compromise of the existence of a defence under s. 42, which may well have been a complete answer to any entitlement to payment on the part of the respondent, was not a matter which affected the validity of the compromise. In my opinion therefore the Tribunal member was right in rejecting the appellants' attempt to reopen the settlement on this basis.
It seems to me that these findings are necessarily also fatal to a claim that the compromise agreement was voidable in that it was arrived at on the basis of a false and fundamental assumption by both parties that the respondent was entitled to be paid monetary consideration for the work carried out by it.
The next issue to be considered by the Tribunal was the issue of whether the power in s. 95(4)(d) was available to be exercised in relation to the contract of 30 June 1994. As indicated earlier, the Tribunal member decided that it was not. It seems to me that s. 95(4) is concerned with powers of the Tribunal, in matters within its jurisdiction, to grant particular forms of relief. The subsection is similar to s. 69 of the District Courts Act, which gives this court power to grant various forms of relief, which only applies when the court has before it a matter which is within its jurisdiction as defined in s. 68: Star Tune Pty Ltd v. Ultra Tune Systems (Aust) Pty Ltd [1991] 1 Qd.R. 192; Matelot Holding Pty Ltd v. Gold Coast City Council [1993] 2 Qd.R. 168. Whether the relief which may he granted by the Tribunal is limited to that set out in subs. (4), or whether it extends to making any “orders and directions as may be just to resolve the dispute and any other matters at issue between the parties”, where there was an issue between the parties as to whether the settlement agreement was unjust and whether the appellants ought to receive restitution in respect of moneys paid pursuant to it, in my opinion it was open to the Tribunal to grant that relief under s. 95. In view of the terms of subs.(1), the scope of the dispute within the jurisdiction of the Tribunal is not necessarily confined to one in respect of a contract of the kind identified in the definition of “domestic building dispute”, namely a contract for the performance of domestic building work, and it seems to me that there is no reason why the power in s. 95(4)(d) should be confined to such a contract, or a term in such a contract. So to confine it could prevent the Tribunal from determining all matters at issue between the parties.
In my opinion the narrow construction of s. 95(4)(d) adopted by the Tribunal is not one which was required by the terms of s. 95, and indeed is not the natural reading of the words of that paragraph, which refer to “any unjust contractual term, or otherwise vary a contract to avoid injustice” (emphasis added).
At p. 35 of her reasons the member of the Tribunal stated that the jurisdiction of the Tribunal “is confined to domestic building disputes”. There certainly must be a domestic building dispute between the parties before the Tribunal has jurisdiction, but once the jurisdiction is enlivened in this way in my opinion it is not confined to the resolution of the domestic building dispute, but extends to the resolution of all other matters in dispute between the same parties, at least where (as here) there is some reasonable connection between those other matters and the domestic building dispute.
The Tribunal, having concluded that there was no jurisdiction to vary the compromise agreement, did not go on to consider whether if there had been jurisdiction it would have been exercised. By s. 94(4) this court has wide powers on appeal, but they include the power to remit the case to the Tribunal for further hearing or re-hearing. The exercise of the power under s. 95(4)(d) would have to be based on findings that the contractual terms sought to be avoided were “unjust”, or that the contract sought to be varied was one which unless varied would result in or continue an injustice, and in my opinion conclusions as to whether these circumstances arose in the present case are best made by a Tribunal which is familiar with all of the relevant circumstances, as would be the member who beard the full trial of the issues in the present case. The appeal from the Tribunal to this court is an appeal in the strict sense. Whywait Pty Ltd v. Davison (Appeal 184 of 1995, Court of Appeal, 4/6/96) and is analogous to an appeal on a question of law from the Administrative Appeal Tribunal to the Federal Court. The practice of the Federal Court in such appeals, where the ultimate outcome will depend on the making of findings or the exercise of discretion which has not been done by the Tribunal, is to remit the matter to the Tribunal unless it is satisfied that on the material no reasonable Tribunal would fail to make the findings or exercise the discretion in favour of a particular party. In my opinion a similar approach should be adopted in dealing with appeals from the Queensland Building Tribunal. It is therefore appropriate that I remit the case to the Tribunal for further hearing and determination of the issue of whether to exercise the power under s. 95(4)(d) with regard to the compromise agreement or any part of it, and if so whether to make any and what consequential orders in order finally to resolve all matters at issue between the parties. It may be helpful however if I address what seems to me to be the correct scope of s. 95(4)(d).
The member of the Tribunal in her reasons at pp. 34-35 quoted some remarks of McGuire DCJ in Johnson Tiles Pty Ltd v. Chard Roberts Constructions Pty Ltd (Appeal 153 of 1993, 17/12/93, pp. 21-22) to the effect that the Tribunal does not resolve disputes in accordance with arbitrary notions of justice, but within the framework of the common law, which remarks I would with respect endorse. Although the powers in para. (d), and indeed para. (e) are novel in terms, one area where it would be appropriate to vary or avoid a contract to prevent injustice would be circumstances where, in accordance with established principles of equity, a court, would grant such relief on grounds which could be so characterised. For example the equitable jurisdiction to rectify contracts can be seen as a jurisdiction to avoid injustice, on the basis that it would be unjust for the parties to be held to the terms of a written document which did not accurately reflect the true agreement between them. Indeed, most if not all of the grounds upon which equity would interfere with a contract could probably be characterised as based on a desire to avoid injustice. The statutory power is not in terms confined to established principles of equity, but in my opinion the Tribunal should be wary about straying beyond those established principles when exercising this power.
I think it is significant that the legislature has not given the Tribunal power to vary a contract or term of a contract on the ground that it would otherwise be “unfair”, which is a different concept: AGC (Advances) Ltd v West (1984) 5 N.S.W.L.R. 301 at 622B. I do not think that the intention was that the Tribunal should have a wide power to adjust the fairness of a contract which had been entered into between the parties, at least in circumstances where there would not be grounds on which equity would interfere with the contract (for example, the ground of duress). As well it should be remembered that the power is not one conferred on a court which already has the power to avoid or vary a contract under the ordinary principles of equity, as is the case with the Contracts Review Act (1980) (NSW). It is easier to treat that Art as reflecting a legislative intention to provide a comprehensive power to deal with unjust contracts. It follows that authorities as to the scope and operation of a statutory power to intervene in unfair contracts will not generally be relevant to the application of s. 95(4)(d), and cases under the Contracts Review Act should be treated with caution.
Furthermore, any assessment of the question of whether a contract or a term of a contract is “unjust” would have to take into account the fact that one of the fundamental principles of law is that prima facie people who voluntarily enter into contracts should be kept to them. That principle would apply with particular force where the contract is one involving the compromise on an existing dispute, a matter which has frequently been the subject of clear statements by courts, a number of which are helpfully referred to on pp. 3 and 4 of the reasons of the Tribunal in the present case. Again it is sufficient for me to endorse those remarks without repeating them. There are certain grounds upon which a compromise can be impeached, including in some limited circumstances the ground of mistake: see Foskett (supra) ch. 4. It is not appropriate for me to say that there can be no other circumstance in which the Tribunal could conclude that it was appropriate to interfere with a compromise agreement, but I think the Tribunal should be very wary about arriving at a conclusion that a compromise agreement was unjust, or that it was appropriate to vary a compromise agreement to avoid injustice, in circumstances which did not come within the established grounds upon which the courts of law would interfere with a compromise agreement.
One matter which does not provide a basis for interference with such an agreement is a mistake as to the validity of the claim compromised, on the basis of ignorance of the existence of a defence: David Securities (supra) at p. 395. It seems to me that the fact that the appellants were ignorant of the existence of a defence under s. 42 at the time the compromise agreement was made is not a matter which provides any basis for concluding that the agreement is unjust.
The Tribunal would also have jurisdiction under s. 95(4)(g) to award costs, and pursuant to the remittal the Tribunal may also deal with the question of the costs of the whole proceedings before it. It would obviously be desirable for the matter to be dealt with by Ms Burke.
Accordingly I allow the appeal, annul the decision of the Tribunal dated 17 June 1996, and remit the case to the Tribunal for further hearing and determination of:
- a)whether it is appropriate to exercise the power in s. 95(4)(d) to avoid or vary the compromise agreement made 30 June 1994 between the parties, and if so whether to grant any and what consequential relief, and
- b)whether and how to exercise the power in s. 95(4)(g) to award costs of the proceedings before the Tribunal.
I will hear submissions from the parties as to the costs of the appeal
IN THE DISTRICT COURT HELD AT BRISBANE QUEENSLAND | Appeal 2790 of 1996 |
IN THE MATTER OF THE QUEENSLAND BUILDING SERVICES AUTHORITY ACT (1991) SECTION 94
AND:
IN THE MATTER OF AN APPEAL
BETWEEN:
KENNETH JOHN ANDERTON AND CHRISTINE ANN ANDERTON | Appellants |
AND:
PARKS HORTICULTURAL SERVICES PTY LTD | Respondent |
SUPPLEMENTARY REASONS FOR JUDGMENT - McGILL DCJ
Delivered the 15th day of November 1996
In this matter I have allowed the appeal, annulled the decision of the Tribunal dated 17 June 1996 and remitted the case to the Tribunal for further hearing and determination of two matters. I pronounced these orders on 11 October 1996, and invited the parties to make submissions as to the costs of the appeal.
The reason for taking this course was that it seemed to me that, although the appeal had been successful, the grounds advanced in support of the appeal by the appellants were unsuccessful, and the effect of my conclusion that there was jurisdiction in the Tribunal was that certain findings unfavourable to the appellants made by the Tribunal would not be interfered with. I also dealt with certain questions of law which arose in the course of the appeal in a way which was generally unfavourable to the appellants. Overall it seemed to me that the appellants had achieved something of a pyrrhic victory.
Nevertheless, in written submissions provided in accordance with my directions, the appellants sought their costs from the respondent. They rely on the proposition that costs should follow the event, and noted that the respondent had, in argument, supported the decision at first instance and opposed both the narrow and the wider bases of jurisdiction during argument on the appeal. It is further submitted that I should not be swayed by my views of the substantive matters that are to be argued before the Tribunal.
It seems to me, with respect, that this is to adopt too narrow and formalistic an interpretation of the event on the appeal. I believe I am entitled to have some regard to the broader objectives of the appellants, which were essentially to make it possible to re-open the compromise agreement of 30 June 1994 referred to in my previous reasons, with a view to having that agreement adjusted in their favour. Although I have concluded that there was jurisdiction to set aside or vary that agreement, the effect of certain conclusions on questions of law that I arrived at in the course of my reasons, when combined with findings previously made by the Tribunal which were not interfered with on appeal, seem to me to make the principal grounds which had been relied on as the basis for re-opening that agreement really unarguable. One of these was that the appellants were ignorant of the existence of a technical defence and, as I have said in my previous reasons, in my opinion as a matter of law that is not a ground for re-opening the agreement. Another was that there was no consideration given for the compromise agreement, and I have concluded that, as a matter of law, the findings of fact of the Tribunal establish the existence of sufficient consideration to support such an agreement. It seems to me that the Tribunal had really decided that there were no grounds for setting aside the agreement on any of the established bases for interfering with a compromise, which were the principal matters relied on by the appellant. Overall in terms of the practical advantage which the appellants sought to achieve by means of this appeal, they have been largely unsuccessful.
One way of testing the appropriateness of the ordinary order for costs is to ask whether the successful party ought to have conducted the proceedings differently, and if so whether that party's inappropriate conduct increased the costs. For example, the plaintiff in a personal injury action who supports his claim with evidence which is found to have been exaggerated and whose exaggerated claims lead to a prolonging of the trial has been deprived of part of his costs notwithstanding that he was ultimately successful in obtaining an award of damages: Cretazzo v. Lombardi (1975) 13 SASR 4. In the present case the appellant's conduct of the appeal was unexceptional but, as I noted at page 8 of my reasons of 11 October 1996, the way in which the matter proceeded in the Tribunal served to obscure the process of identifying the domestic building dispute which was in fact before the Tribunal. Furthermore, the respondent may have been encouraged in its argument that mere was no jurisdiction by the basis upon which jurisdiction was claimed, which as I indicated on page 7 of my reasons seems to me to be in error. On the other hand, it would have been open to the respondent to have recognised the true basis of jurisdiction.
Overall, it seems to me that the appellants have not engaged in such conduct in relation to this matter as would justify my depriving them wholly of their costs, but I think that the considerations I have mentioned justify a departure from the ordinary rule that costs follow the event. On the occasion when Morley DCJ granted leave to appeal the costs of that application were reserved and I propose to deal with the costs of that application and of the appeal by fixing costs for the appellants in an amount which is intended to cover only a part of their costs for the whole proceedings, namely $3,000.
I order the respondent to pay the appellants' costs of and incidental to the appeal, including reserved costs, fixed in the sum of $3,000.
The respondent has applied for an indemnity certificate under section 15(3) of the Appeal Costs Fund Act 1973. Such an order can only be made under that sub-section in the case of an appeal to this Court from a “court”. The term “court” is defined in section 4 of the Act as including “any board, other body or person from whose decision there is an appeal to a superior court on a question of law or which may state a case for the opinion or determination of a superior court on a question of law or reserve any question of law in the form of a special case for the opinion of a superior court.” That definition raises the question of whether the term “superior court” is used in its usual technical sense of a court, the jurisdiction of which is prima facie comprehensive, in contradistinction to an inferior court which is a court, the jurisdiction of which is limited to that expressly provided or to be implied from the legislation establishing it: Logwon Pty Ltd v. Warringah Shire Council, (1993) 33 N.S.W.L.R. 13 at 28. Generally the superior courts are the successors of the Royal Courts in England: ibid page 17.
Within that dichotomy, the District Court falls within the category of inferior courts: Stevens v. Trewin [1968] Qd.R 411; Hydromic Industries Pty Ltd v. Taylor, (1979) 5 QL 313. If the term “superior court” is given its correct meaning in this definition, it would follow that where there was an appeal or other proceedings for review from a board, other body or person to the Supreme Court, there is jurisdiction to grant a certificate in respect of that appeal, but if the appeal is brought to the District Court, it is not covered by s. 15(3). It is not immediately apparent why there should be this distinction for the purposes of the Act or that there is any policy reason for such a distinction, but obviously there will be an important difference in the scope of the Act if this term is given its correct meaning, since there are a number of boards and Tribunals from which an appeal may be brought to this Court.
The Appeal Costs Fund Act is clearly beneficial legislation, and that would indicate that an interpretation should be favoured which expanded rather than contacted its scope. I am also conscious that I should prefer the interpretation which will best achieve the purpose of the Act (Acts Interpretation Act 1954 s. 14A(1)), but in circumstances where the purpose of the Act is presumably that stated in its long title - to make provision with respect to liability for the costs of certain litigation, to establish a fund to meet that liability and for purposes connected therewith - I do not think that I can conclude that the purpose of the Act was such as to require any particular interrelation of this term. The purpose of the Act was relevantly to provide for certificates to be issued in certain defined circumstances, and whatever interpretation is given to the words in the definition of “court” in s. 4, there will be some which fall within it and some which do not.
The structure of s. 15 suggests that the operation of the Act would be more sensible if the term “superior court” included the District Court as well as the Supreme Court, but the difficulty that I have is in determining a meaning for “superior” which would produce that result. If superior is used in its technical sense, the District Court is excluded. The only other meaning that seems to me to be available is where the expression “a superior court” is used as meaning a court which is superior to the court in question. Such an interpretation involves difficulties since it would make the word “superior” superfluous. It could also produce a definition of “court” which was so wide as to be quite inappropriate; for example, there is no reason why it should apply to a body from whose decision there was an appeal to another body which is not itself a court except under this extended definition. Indeed, there is, it seems to me, no practical reason why it should apply to a board, other body or person from whose decision there was an appeal to a Magistrates Court.
It is one thing for a court to prefer a one recognised meaning of a word over another in order to give effect to the principles of construction to which I have referred. It is, in my opinion, a different matter for a court to invent what is really a new meaning for a word simply in order to produce the result that the legislation will be thought to work better than it otherwise would. That seems to me to stray from interpretation of statutes to correction of statutes, which is not my function.
In my opinion therefore the correct interpretation of the expression “a superior court” in the definition of “court” in s. 4 of the Appeal Costs Fund Act 1973 is the correct legal meaning of that term, which does not extend to the District Court.
Part 7 of the Queensland Building Services Authority Act 1991 provides for appeals (by leave) from the Tribunal to the District Court (s. 94) and for the Tribunal to state a case for the opinion of the District Court (s. 93) but there does not appear to be anything which would permit an appeal in the extended sense relevant to the Appeal Costs Fund Act to the Supreme Court (or for that matter any other superior court). I do not think that it is relevant to consider the fact that an appeal may be brought from a decision of the District Court to the Court of Appeal, which as part of the Supreme Court is a superior court, since treating the definition of “court” as encompassing bodies from which an appeal may be brought ultimately to a superior court suffers from the same difficulties as those arising if the word “superior” is given the other meaning referred to earlier, that is, any court which is superior to the court from which the appeal is brought. There is nothing in the Queensland Building Services Authority Act 1991 to constitute the Tribunal a court by ordinary principles: it is expressly established as “a Tribunal”: s. 75. The terms of s. 97 contemplate a dichotomy between the Tribunal and a court. It follows that, in my opinion, the Queensland Building Tribunal is not a court within the extended definition in s. 4 of the Appeal Costs Fund Act.
In my opinion therefore the appeal in the present case is not an appeal against the decision of a court and there is therefore no jurisdiction under s. 15(3) to grant an indemnity certificate.
I should add that, if I were wrong about this and there were jurisdiction, in my opinion this is not one of those cases where there has been an appeal because of an error of law by the court under appeal to which the respondent on the appeal has not contributed. See Re Cooke (White J, Misc 688 of 1994, 17.7.95); Acquilina v. Dairy Farmers Co-operative Milk Co. Ltd. (No 2) [1965] N.S.W.R. 772 at 774; Brisbane City Council v. Ferro Enterprises Pty. Ltd [1976] Qd.R. 332. The respondent disputed the jurisdiction of the Tribunal when the matter was before it, and indeed sought to raise that issue as a preliminary point, and so far as I can see, maintained its argument that there was no jurisdiction throughout the proceedings. Compare Makucha v. Albert Shire Council (Court of Appeal, No 101 of 1991, 19.6.92) I do not consider that the circumstance that the Tribunal was to some extent led into the error by the way in which the matter was argued on behalf of the appellants is something which justifies granting an indemnity certificate to the respondent. There are, in my opinion, no other circumstances justifying the grant of a certificate in this case.
The application for an indemnity certificate is therefore refused.