Morrison v Australian Postal Corporation
[2001] QDC 301
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- Unreported Judgment
- Morrison v Australian Postal Corporation[2001] QDC 301
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Morrison v Australian Postal Corporation[2001] QDC 301
Morrison v Australian Postal Corporation[2001] QDC 301
DISTRICT COURT OF QUEENSLAND
CITATION: | Morrison v. Australian Postal Corporation [2001] QDC 301 |
PARTIES: | PETER CHARLES MORRISON (Appellant) v. AUSTRALIAN POSTAL CORPORATION (Respondent) |
FILE NO/S: | Appeal D3399 of 2001 M3977 of 2000 |
DIVISION: |
|
PROCEEDING: | Appeal |
ORIGINATING COURT: | Magistrates Court Brisbane |
DELIVERED ON: | 26 November 2001 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 6 November 2001 |
JUDGE: | McGill DCJ |
ORDER: | Appeal allowed in part. Judgment of 19 June 2001 varied by substituting judgment that the appellant pay to the respondent the amount of $14,221.77, including $1,085.53 interest to the date of judgment, and $5,017 for costs. The appeal is otherwise dismissed. I order the appellant to pay the respondent’s costs of and incidental to the appeal to be assessed. |
CATCHWORDS: | RESTITUTION – Money Counts – quantum meruit – franking machine – defective machine continuing to operate after credit exhausted – liability of user – pleading – amount payable. Browne v. Dunn (1893) 6 R 97 – cited Gino d’Alessandro Constructions Pty Ltd v. Powis [1987] 2 Qd.R. 40 – applied Victors v. Davies (1844) 12 M&W 758, 152 ER 1405 – cited Fisher v. Pyne (1841) Man & G 265, 133 ER 334 – cited Alexander v. Warman (1866) H & N 100 – cited Pohlmann v. Harrison [1995] 2 Qd.R. 59 – applied Pavey Matthews Pty Ltd v. Paul (1986) 162 CLR 221 – applied |
COUNSEL: | A N Stone for the appellant C M Muir for the respondent |
SOLICITORS: | Morrisons Solicitors for the appellant Jones King Lawyers for the respondent |
- [1]This is an appeal by the defendant against a judgment given against him in the Magistrates Court on 19 June 2001. He was ordered to pay the respondent $8,446.40 by way of claim, together with $1,129.27 as interest and $5,017.00 for costs, a total judgment of $14,592.67. A number of matters were raised in the appeal, going to questions of procedure and questions of substance. It is convenient first to set out something of the background to the claim, the pleadings, and the decision of the Magistrate.
Background to the claim
- [2]On 14 November 1978 Coorparoo Employment and Leasing Services Pty Ltd (“the company”) applied for a licence to use a franking machine: Exhibit 9. The machine supplied was a Pitney Bowes 6300 model, having serial number 6459. A licence was issued (Exhibit 3) and remained in operation until 1985, when the appellant, a solicitor practicing under the name “Morrison & Company” wrote to the respondent advising of a change of “our postal address” and seeking to have this changed on “our franking machine”: Exhibit 4. The appellant was a director of the company, (Exhibit 11) and the company functioned as a service company for his practice: p. 88. A few days later a fresh licence was issued to “Morrison & Company” with the new postal address: Exhibit 1. This was sent to the appellant under cover of a letter: Exhibit 4. The company was incorporated in May 1974 and was deregistered under s. 574 on 24 June 1993: Exhibit 11.
- [3]A franking machine is a device which renders unnecessary the adhesive stamp as the mechanism for paying for postal services. Its function is to print a mark on an envelope similar to a stamp cancellation mark to indicate that the postage for that envelope has been paid[1]. A franking machine can generally be adjusted so that different amounts of postage, appropriate in the light of differing postal charges, can be applied as appropriate to the various articles franked. When properly functioning, the machine will not apply a frank for which payment has not already been made to the respondent. This is achieved by the licensee taking the machine to a post office where a payment is made and the machine is then adjusted to increase by that amount the “credit” in the machine, and then sealed. It can then be used to frank articles until the total value of the franking exhausts the credit. As with the purchase of postage stamps, the postal service is paid for prior to the time when it is used.
- [4]The franking machine in this case had on it a meter which recorded the amount of credit available in the machine, and another with the total of the value of all the franking which had already been applied by the machine: p. 22. The former is referred to as the “credit meter” and the latter the “tote meter”. When the machine is operating normally, as the value shown on the credit meter decreases, the value on the tote meter increases, by the same amount: p. 52. The machine is equipped with a locking bar and, if that is properly positioned, once the amount of credit is exhausted, the machine will no longer work.
- [5]The respondent kept a card record of the various amounts of credit which had been provided to this particular machine, and the cards from October 1990 were put in evidence: Exhibit 7. On each occasion credit was obtained, a record was kept on the card with the date, the amount of credit paid for on that occasion, the progressive total of credits, the credit meter reading before adjustment to reflect the credit paid for, the credit meter reading after that adjustment, the tote meter reading, and a check figure derived by adding the credit meter reading after adjustment and the tote meter reading, which ought to equal the progressive total of credits. After October 1990 there were three other occasions in 1990 when credit was purchased, and during 1991 on 14 occasions additional amounts of credit were purchased, a total of $4,200. During 1992 there were 13 payments for credit totalling $2,900. In 1993, there were 12, totalling $3,600. In 1994 there were 8, totalling $2,400, in 1995 there were 10, totalling $3,000; and in 1996, 4 totalling $1200, the last being on 24 May 1996. On that occasion after the credit meter was adjusted it read $322.50, and the tote meter read $62,288.80: Exhibit 7.
- [6]The machine was not seen again at the post office. In May 1999, Mr. Newton, a postal manager, reviewed the file and discovered that the machine had not been in for some time, and asked that it be brought in for inspection: p. 18. That request was made on a number of occasions, but it was not brought in. On one occasion he attended the office of the appellant where he saw the machine but was not allowed to inspect it. He telephoned again on a number of occasions, but each time was told that it was not convenient for the inspection to take place. Eventually he went back to the appellant’s office on 24 September 1999 and, after a bit of persuasion, was allowed to look at the meters and noted that the credit meter read $329.21 and the tote meter read $70,703.99: p. 23. This information was recorded on the card, Exhibit 7.
- [7]The change in the tote meter indicated that the machine had been used to frank articles of a value substantially more than $322.50 since 24 May 1996. He wrote to the appellant seeking payment of the amount of the discrepancy: Exhibit 8. There was no response. On 30 September he and an employee of the company which owned the machines, Mr. Shelton, went to the appellant’s premises. Mr. Shelton said that he saw the machine and saw a bulge in the plastic cover which suggested that the locking bar on the machine had not been set properly: p. 51. Mr. Newton unsealed the machine, opened the lid, and found the locking bar in the wrong place, pushed it across into the correct position, did not change the reading on either meter, and closed and resealed the machine: p. 26-7. Mr. Shelton said that the effect of this incorrect locking would be that the credit meter would not descend as it was supposed to, although there would be no effect on the tote meter: p. 53. A further set of readings were taken on that day and are recorded in Exhibit 7: credit meter $327.16; tote meter $70,730.54.
- [8]On 19 January 2000, the respondent wrote to the appellant seeking payment of the amount of $8,446.40, an amount derived by adding together the credit meter reading and the tote meter reading as at 30 September 1999, and subtracting the total of the credit meter reading and the tote meter reading as at 24 May 1996, after the credit meter was reset following the purchase of credit of $300 on that date. On 1 February 2000, the appellant replied, noting that the licensed user of the machine was Coorparoo Employment and Leasing Services Pty Ltd and suggesting that the respondent address correspondence to that company. That response was (at best) disingenuous, since that company had ceased to exist over 7 years earlier. The appellant claimed never to have received any formal notification of deregistration of the company in 1993 (p. 97). Nevertheless, it must have been obvious to him that the company was defunct; he would certainly have found out about it if he had attempted to file an annual return any time after 1993. In any case, the appellant did not pay and proceedings were taken by the respondent to recover payment for the postal services used by the appellant.
- [9]The appellant also said that he had directed his staff not to use the franking machine, apparently in 1994: p. 90. He said he never saw anyone using the machine after he gave that direction, and from 1996 he had never heard the noise of the machine being used in the office, although the sound was distinctive, it was only a small office and he was there most of the time: p. 91. There was clear evidence which the Magistrate accepted that in fact the machine was being regularly used for the appellant’s mail after 1996. Mr. Harmsworth, an employee of the respondent, said that the appellant’s firm had lodged franked mail over the counter, usually daily, from when he started at the Coorparoo Post Office in 1993 until late in 1999: p. 59. He had also at one time received franked letters from the appellant, and two of those, dated 12 October 1998 and 23 February 1999, were put in evidence: Exhibits 13, 14. Mr. Newton could also recall franked mail from the appellant coming in during the relevant period: p. 29. The increase in the tote meter from May 1996 to September 1999, $8,441.74, is similar to the increase during the prior period of 40 months, $9,587.20[2]. The Magistrate was clearly entitled to accept that evidence, and it supports an inference that in fact the machine was still being regularly used by the appellant during that period to frank letters.
- [10]There was evidence from both Mr. Newton and Mr. Shelton that, notwithstanding any defect in the operation of the credit meter and the locking bar, the tote meter would continue to operate and would record the use that was made of the machine to frank articles. The Magistrate accepted that evidence. He was plainly entitled to do so. There was no evidence to the contrary. Indeed, the only challenge to the reliability of the machine arose from the fact that between the inspections on 24 September 1999 and 30 September 1999, although the tote meter reading increased by about $26, the credit meter reading decreased by only about $2. According to the evidence of Mr. Newton and Mr. Shelton, when the machine was operating correctly, the tote meter would increase as the credit meter decreased and by the same amount. However, their evidence was also that the machine on this occasion was not operating correctly.
- [11]Mr. Newton, who is not an expert on the machines, when cross-examined about this apparent discrepancy (pp. 36-42), had some difficulty in accounting for it, but adhered to the view that the tote meter would operate correctly even if the credit meter was playing up: p. 39. Mr. Shelton was an expert in the machines but there was the difficulty for the respondent that it had not complied with r. 423, and was therefore not able to lead expert evidence from him. Nevertheless, some evidence, which was I think really expert evidence, was given without objection, including that, when the machine was working properly, the decrease in the credit meter would match the increase in the tote meter: p. 52. Mr. Shelton did not say that the same would apply if the machine was not properly set, because the locking bar was not in the correct position.
- [12]If the appellant’s case was that the tote meter was unreliable because of this apparent discrepancy, plainly that ought to have been put to Mr. Shelton in cross-examination, as he was the appropriate witness called on behalf of the respondent to comment. It was not put, and in my opinion, that was a clear breach of the rule in Browne v. Dunn (1893) 6 R 97. In these circumstances, the Magistrate was entitled to place little weight on the argument that the tote meter may have been malfunctioning because of the discrepancy between the change in the tote meter and the change in the credit meter between 24 and 30 September 1999. The position was that there was simply no evidence that the credit meter would continue to operate in the way it ought to have operated when it was not set properly, as was found to be the case when this machine was inspected on 30 September 1999.
- [13]If the machine had been working properly, once the $322.50 worth of credit in the machine when it left the post office on 24 May 1999 had been exhausted, the machine would have ceased to function. The tote meter would therefore have stopped at the point when that credit was exhausted. Plainly that did not happen. The Magistrate had evidence that the tote meter would have continued to operate properly[3], notwithstanding the problem with the credit meter, and was entitled to accept that evidence. He was entitled to infer that it was the appellant who was using the machine, either by himself or by his employees; it could not have been the company, at least not after 1993 when it ceased to exist. The Magistrate was therefore entitled to find the appellant liable to pay the amount owing in accordance with the use of the machine.
The pleadings
- [14]By a claim filed in the Magistrates Court at Brisbane on 15 February 2000, the respondent claimed from the appellant $8,446.40. The statement of claim was in the following terms:
“The plaintiff claims the following relief: The plaintiff claims the sum of $8,446.40 being the balance of debits incurred on a Pitney Bowes franking machine (licence number PB6459) in the period 24 May 1996 to 30 September 1999, that machine being licensed to the defendant. The plaintiff also claims costs and interest pursuant to the Supreme Court Act 1995.”
Details of the costs are given in the notice under r. 158(3).
- [15]The appellant filed a notice of intention to defend and defence on 14 March 2000. There was a general denial of the claim, and allegations that the appellant had not used that franking machine during the period 24 May 1996 to 30 September 1999, and that the appellant did not hold a license from the respondent to use the franking machine. There were other allegations which were matters of evidence rather than material facts. By a letter dated 2 March 2000, the appellant’s solicitors sought what were described as further particulars of the claim, although most of those were not, in my opinion, proper requests for particulars. Some of the requests were answered by particulars dated 24 March 2000, and provided under cover of a letter of that date from the respondent’s solicitors.
- [16]By a reply filed 3 July 2000, the respondent further pleaded that the amount claimed reflected the difference between certain meter readings on the franking machine which was “the amount of debts accumulated by the appellant’s franking machine while it was used to frank articles for postage [in the relevant period, which] could have only arisen through the use of the appellant’s franking machine, without the appellant paying in advance for credits on the franking machine”. There was a further allegation in the reply which made express what had been implied in the earlier part of the reply, that it was the appellant who was using the franking machine until September 1999. The pleadings therefore alleged that the appellant had franked and posted articles where the franking had not been paid for by the appellant, using this machine.
Grounds 1 and 3 – deficiency in the pleadings
- [17]It was submitted by the appellant that the respondent’s pleading did not show that any obligation existed to make payments in respect of meter usage to a particular value, nor if such payment was due how it was to be calculated, and that the pleading did not reveal a cause of action. It was submitted that there had been a failure to comply with r. 150(1)(a) in that there had been a failure to plead specifically the breach of contract relied on. It was submitted that the pleading was particularly deficient because it did not plead the relevant terms of the licence agreement. It was submitted that the pleading was defective to the point where it did not disclose a cause of action, and it ought to have been struck out, and it did not allow evidence to be introduced to show the existence of any agreement between the parties.
- [18]It may well be that the statement of claim was defective, either as a claim for damages for breach of contract, or even as a claim for monies payable pursuant to an obligation in contract. There are passages in the judgment of the Magistrate which suggest that he was examining the issue by reference to the existence or otherwise of a contract between the parties[4], but in my opinion, it was unnecessary for the respondent to prove the existence of a contract between the parties in order to recover.
- [19]The licence (Exhibit 1) stated that it was issued subject to the provisions of the Postal Service Act 1975 and Postal By-laws. There was no reliance on anything in that Act or those by-laws pleaded by the respondent, and no reference made to the content of any relevant provision in the Act or by-laws in the course of argument before me, and I have not checked to see whether there is any relevant statutory provision there or elsewhere governing the existence or otherwise of any obligation on anybody to make payment in the respect of the use of a franking machine. It may well be that there is a statutory obligation and that reliance on remedies apart from statute was unnecessary, but there was no specific pleading of the statutory provisions as there ought to have been if they were relied on[5], and I shall consider the liability of the appellant only apart from statute.
Liability in restitution
- [20]What was pleaded and proved by the respondent here was simply that the appellant had used the franking machine (which he was licensed to use, that is, permitted to use) to frank articles for postage where the use of the machine did not involve the application of credit which had previously been paid for and put into the machine, that is to say, where the machine was operating in debit. That, in my opinion, is sufficient to give rise to a cause of action for a restitutionary claim by the respondent against the appellant. That follows from the fact that what the machine was used for was to put impressions on letters which would then be delivered to the respondent for carriage and distribution by it as if paid for. The appellant was using postal services under circumstances where ordinarily payment would have been made in respect of franked articles prior to the time when they were presented to the respondent for carriage. Accordingly, by using the machine after the credit in the machine had been exhausted, the appellant was using the postal service to carry his mail without paying for those services.
- [21]The provision of services by a plaintiff to a defendant at the request of the defendant will give rise to an obligation to pay a reasonable amount for such services, in the absence of any enforceable contract governing the transaction. But an obligation to pay for services is not confined to cases where there has been an actual request.
- [22]In Pavey Matthews Pty Ltd v. Paul (1986) 162 CLR 221, the High Court held that a right to recover on a quantum meruit does not depend on the existence of an implied contract, but on a claim for restitution or one based on unjust enrichment, arising in that case from the respondent’s acceptance of the benefits accruing to him from the appellant’s performance of the unenforceable oral contract: see p.227. Deane J at p. 256 said:
“The circumstances in which the common law imposes an enforceable obligation to pay compensation for a benefit accepted under an unenforceable agreement … is preferably seen as lying in restitution rather than in the implication of a genuine agreement where in fact the unenforceable agreement left no room for one. That is not to deny the importance of the concept of unjust enrichment in the law of this country. It constitutes a unifying legal concept which explains why the law recognises, in a variety of distinct categories of case, an obligation on the part of the defendant to make fair and just restitution for a benefit derived at the expense of a plaintiff and which assists in the determination, by the ordinary processes of legal reasoning, of the question whether the law should, in justice, recognise such an obligation in a new or developing category of case. … In a category of case where the law recognises an obligation to pay a reasonable remuneration or compensation for a benefit actually or constructively accepted, the general concept of restitution or unjust enrichment is … also relevant, in a more direct sense, to the identification of a proper basis upon which the quantum of remuneration or compensation should be ascertained in that particular category of case.”
- [23]One of the recognised categories is in respect of remuneration for services provided by a plaintiff and accepted by a defendant: Goff & Jones “The Law of Restitution” (4th ed., 1993) p. 18-20. Although there is some discussion in that text as to whether the test of acceptance has been expressly adopted by the courts, the one place it has been expressly adopted is in Australia, in the light of the passages just quoted in the judgment of Deane J[6]. Plainly in the present case the appellant, by franking articles which were then lodged at the post office for carriage, was accepting the benefit provided to him by the continuing operation of the franking machine. Where the entitlement to payment arose because the consideration for the payment was executed (that is, where the consideration was the provision of services, those have been performed) the obligation is one enforceable in debt under an action in indebitatus assumpsit, independent of an action on the contract: Gino d’Alessandro Constructions Pty Ltd v. Powis [1987] 2 Qd.R. 40 at 45.
- [24]The pleading in the present case does not include a plea that any services were rendered at the request of the appellant, but the plea of a request is not necessary in pleading a claim of this nature: Victors v. Davies (1844) 12 M&W 758, 152 ER 1405, citing Fisher v. Pyne (1841) Man & G 265, 133 ER 334. It is sufficient if the service was rendered pursuant to a common understanding that it be paid for, which is the presumption when, for example, a professional person is engaged to do work: Alexander v. Warman (1866) H & N 100 at 108. Where a franking machine is used to imprint “postage paid” on an envelope which is then lodged at the post office for carriage and delivery, something which is ordinarily done only when the postage has in fact been paid for by credit being previously put into the franking machine, there is in my opinion no difficulty in concluding that there is an implication that the postage is to be paid for. There could be no suggestion that in such circumstances the intention of the respondent was to carry the letters free, and that ought to have been obvious to the appellant.
- [25]Although I am not aware of any authorities on the point, in my opinion the application of the general principles to which I have referred is that, where a franking machine is used to frank mail (as if by a process which involves the use and application of credit which has previously been put into the machine by the respondent after that credit was paid for by the licensee of the machine), and there is no credit available in the machine, and those articles are subsequently posted in reliance on that franking, there is a restitutionary obligation to the respondent on the part of the person doing this to pay for the postage of those articles. In Pavey & Matthews Pty Ltd (supra) the High Court also held that, where there was an unenforceable contract in respect of the work, the contract price was an appropriate measure of reasonable remuneration for the work that was done. By analogy, where the machine is used to print values of postage selected by the person who was using the machine, the appropriate measure of the reasonable remuneration for the services is the face value of the postage so imprinted.
- [26]This liability arises independently of the terms of the applicable statutes, or the terms of the licence issued to the appellant; indeed, in my opinion it arises from the use of the machine by the appellant rather than the existence of any licence, and would have arisen in the same way even if the only licence in existence had still been the licence to the company. If the company was still in existence and was able to pay the debt, so that the appellant in using the machine was doing so in the expectation that it would be the company that would pay for the postage, then no liability on him would arise. But that could not have been the situation here, because there can be no liability in the company in respect of this use of the machine because the company was not in existence at the time. The appellant is therefore not relieved of the restitutionary liability to pay by the existence of any enforceable contractual liability on the part of someone else to pay.
- [27]Had there been no licence issued to the appellant, but any contractual obligation of the company had become unenforceable as a result of the dissolution of the company, the position would have been analogous in my opinion to that considered by the Court of Appeal in Pohlmann v. Harrison [1995] 2 Qd.R. 59, where the court applied Pavey & Matthews Pty Ltd (supra) in a situation where the appellants had entered into a contract to build a house with one Anderson who was not a registered builder, and who induced the respondents (who were) to construct the house in the belief that there was a building contract in existence between them and the appellants, they having (at the instigation of Anderson) previously signed a contract to that effect. The house was built and accepted by the appellants, but they declined to pay the respondents on the ground that any liability they had was under a contract with Anderson. That contract was not enforceable since Anderson was not a registered builder. Fitzgerald P and White J, in a joint judgment, held that the respondents were entitled to succeed on a quantum meruit claim. Their Honours said at p. 62:
“The essential basis for such a claim, namely, execution of work for which no enforceable contract exists and acceptance of the work by the party for whom it is performed, is clearly demonstrated in this case. It is, of course, of fundamental significance to the conclusion that the respondent has established the basis for a quantum meruit claim that:
- the contract between the appellants and Anderson is unenforceable, as is any contract between the appellants and the respondent; or
- it was the respondent who built the appellants’ house. Indeed, he built it with the active encouragement of the appellants.”
- [28]Their Honours analysed the facts on the basis that there was an oral contract between the parties which, however, was unenforceable by statute because it was not in writing, and therefore not a bar to the claim in quantum meruit. However, the existence of the oral contract was not an essential part of the basis of liability, as shown by the judgment of Pincus JA who concluded that on the evidence the finding of the trial judge of an actual contract between the appellants and the respondents could not be sustained, but nevertheless held that the appellants were liable in quantum meruit. The important considerations were that the respondents had done the work expecting to be paid, because they believed that there was a contract between them and the appellants; the appellants had expected to pay for the work, because they had entered into a contract with Anderson for the work to be done; the appellants were not liable to pay Anderson because that contract was unenforceable by Anderson so that, if they were not liable to the respondents, they would obtain a substantial benefit at the respondents’ expense; and the respondents could not recover from Anderson for the work they had done: p. 63.
- [29]Accordingly, in my opinion, in the present case even if there never had been a new licence issued to the appellant, or if the Magistrate had accepted the appellant’s evidence that he was unaware of the licence having been issued in his name (which the Magistrate did not) in my opinion that would not have made any difference to the liability of the appellant.
- [30]In view of the authorities to which I have referred I should say something about the significance of the absence of an enforceable contract. In my opinion, that is not an element for a cause of action which has to be pleaded by a plaintiff; the existence of an enforceable contract in respect of the work, either between the parties or in favour of the plaintiff against someone else, would be a matter of defence to a cause of action in quantum meruit. It is for the defendant to plead the existence of an enforceable contract as a matter of defence, not a matter for the plaintiff to plead the absence of an enforceable contract to show a cause of action.
- [31]In my opinion therefore all the material facts necessary to support a restitutionary claim were pleaded by the respondent, at least if one reads the statement of claim, particulars, and reply together. That is not to say that this is a form of pleading which I would endorse or encourage; there were things pleaded in the reply which really ought to have been in the statement of claim, but the fact that they were pleaded in the reply rather than in the statement of claim was a matter of irregularity rather than a matter which rendered the proceeding invalid. So long as a fact was pleaded in the reply, the appellant had notice of it, and he is not shown to have been prejudiced by this. A failure to comply with the requirements of the rules in relation to pleadings is an irregularity: r. 371(1). A defendant who considers the plaintiff’s pleading to be insufficient should either apply to strike it out, or at least plead that the statement of claim does not disclose a cause of action; the appellant in this case did neither.
- [32]It may be that the form of the statement of claim used in this case was influenced by the short forms of pleading which were formerly sanctioned by the Magistrates Court Rules 1960 r. 46(2). A series of forms of claim were set out in Schedule 2 to those rules, which included for example in Form 2 a claim for services rendered in the following terms:
“The plaintiff claims $……….. for services (here describe services generally) rendered (in this district or as the case may be) by the plaintiff to the defendant on the (insert date or period), the particulars of which had already been delivered”.
This succinct form was adequate under those rules because it was expressly sanctioned by r. 46(2), and was in my opinion a sufficient pleading of a quantum meruit claim: I decided that point in Hargraves Mooney Kenny Pty Ltd v. Balkin (Plaint 77/92, 7.10.92, unreported). However, such a form should not be used under the Uniform Civil Procedure Rules.
- [33]Accordingly, in my opinion, the pleadings although irregular did plead somewhere all material facts necessary for a restitutionary claim, and on the evidence in the light of the findings of the Magistrate the respondent is entitled to succeed in a restitutionary claim. It was not necessary to plead or prove the terms of the licence agreement, or plead or prove a contract between the parties. These grounds of appeal therefore fail.
Ground 2 – reply too late
- [34]The next ground was that the reply ought to have been struck out, or at least disregarded, because of the failure to file and serve it within the time limited by r. 164(2). The appellant took the position that in the absence of a timely reply, there was a deemed non-admission so that the respondent was not entitled to give or call evidence relating to any fact in the defence which was not admitted unless the evidence related to something pleaded in the claim: r. 168(1), r. 165(2). This was a matter raised in argument at the trial, and the Magistrate under r. 371(2)(d) declared the reply to be effectual, notwithstanding that it was delivered late. That was a step that the Magistrate was entitled to take; the failure to deliver a reply in time was an irregularity: r. 371(1). The reply was delivered well in advance of the trial, and there was no prejudice to the appellant shown as a result of the delay in the reply. There were, as I said, deficiencies in the pleading, but the Magistrate was entitled to take the view that it was appropriate to make an order under r. 371(2)(d) and there are no grounds shown to interfere on appeal with the exercise of that power.
Grounds 4 and 5 – no knowledge of the new licence by the appellant
- [35]The next grounds challenged the conclusion that the appellant was liable on the basis that he had acquiesced in the change of the licence from the company to “Morrison and Co”. In my opinion for reasons I have already given the appellant is liable because of his use of the machine regardless of whether or not there was any contract constituted by his acceptance of the licence, or indeed whether the licence was validly issued to him. The licence is, strictly speaking, simply permission to use the machine, unless it is proved to have some further significance either as a contract or under the relevant statute or subordinate legislation. In my opinion, the proof of the existence of a licence to the appellant and the proof of the appellant’s acceptance of the license or acquiescence, were really unnecessary. The appellant is liable on a restitutionary basis without proof of those matters. It is therefore not necessary to consider this ground further.
Ground 6 – Finding that tote meter reliable unjustified
- [36]The next ground was that the Magistrate was not entitled to conclude in the light of the evidence that the tote meter was reliable. This is based on the proposition referred to earlier, that when the machine was operating properly the decrease in the amount shown on the credit meter would be the same as the increase in the amount shown on the tote meter, and the change in the credit meter between 24 September and 30 September 1999 was not the same as the change in the tote meter. However, the evidence was that there would be this equivalence in circumstances where the machine was operating properly, and the machine here was not operating properly, because had it been doing so it would have stopped operating once the credit available had been exhausted. The evidence was that the locking bar on the machine had not been properly set. There was no clear evidence as to what effect this had on the operation of the credit meter, at least once the credit in the machine was exhausted. There was, however, evidence that the operation of the tote meter was not adversely affected. The Magistrate was entitled to accept that evidence, and on that basis find that the tote meter indicated the usage of the machine after 24 May 1996.
- [37]As I have already indicated, if the appellant was proposing to argue that the reliability of the tote meter was doubtful because of the problem with the machine in relation to the locking bar on the credit meter, that was a matter which ought to have been put in cross-examination to Mr. Shelton, but was not. An appeal court is naturally reluctant to interfere with a finding of fact based on evidence at the trial on a ground the basis for which was not laid by proper cross-examination at the trial. I agree that there are aspects of Mr. Newton’s evidence which make the discrepancy to which I have referred curious, but there was evidence before the Magistrate which supported his finding and he was entitled to accept it, and no ground has been shown to justify my setting aside that finding on appeal.
Ground 7 – Failure to plead capacity to sue
- [38]The final matter relied on was the failure of the respondent to plead the existence of the respondent as an entity capable of suing. This was a matter raised at the trial, and the Magistrate in his decision granted the respondent leave to amend within 7 days. That amendment was made. The appellant however submitted that the respondent, having closed its case, should not have been granted leave to make the amendment.
- [39]The respondent is incorporated by statute, having been incorporated by the Postal Service Act 1975 and continued in existence pursuant to the Australian Postal Corporation Act 1989 s. 12. By s. 13 of that Act, it may sue in its corporate name. By s. 143(1)(a) of the Evidence Act 1995 (Commonwealth), proof is not required about the provisions of this Act[7]. Where a plaintiff is a corporation directly created by statute, and expressly given by statute a capacity to sue, in my opinion it is not necessary to plead and prove the incorporation of that plaintiff or its capacity to sue. Accordingly, the appellant’s point was bad, and should have been disregarded by the Magistrate. However, if it were necessary to plead the incorporation of the respondent so as to establish a capacity to sue, in my opinion the failure to do so was an irregularity and there was no reason why that could not be cured by an amendment. There is no reason to interfere with the approach adopted by the Magistrate. This ground also fails.
Amount of appellant’s liability
- [40]There is however one problem of substance in the respondent’s claim, although it does not ever appear to have occurred to the appellant. The effect of the evidence accepted by the Magistrate was that the change in the reading on the tote meter reflected the value of the mail which had been franked by the machine between the time when it was seen at the post office on 24 May 1996 and the time when it was inspected at the appellant’s premises. There is therefore evidence that between the former date and the date of the second inspection the value of the franking undertaken by the appellant with the machine came to $8,441.74[8]. However, when the machine was taken out of the post office on 24 May 1996 it had $322.50 in credit, that is the appellant had already paid for that amount of franking, and was therefore entitled to use the machine to frank articles up to that figure without incurring any restitutionary obligation to pay the respondent. The amount of use that the appellant is proved to have made of the machine therefore, on the evidence accepted by the Magistrate, for which the appellant has not already paid, is obtained by deducting from the change in the tote meter reading the amount of credit that was in the machine at the beginning of the period, $322.50. This leaves a balance of $8,119.24. That, in my opinion, is the amount for which the appellant is actually liable, representing the use made of the machine up to 30 September 1999 for which the appellant had not paid. There was no evidence of any use after that date.
- [41]The explanation for the difference between this figure and the amount claimed by the respondent is that as a result of the inspection on 30 September 1999, the machine had the locking bar reinstated with the credit dial showing $327.16. That however was not an amount for which the appellant had paid. I suppose the machine could then have been used by the appellant to frank mail to the value of a further $327.16, but there was no evidence that the appellant took advantage of that. There is therefore no basis for a restitutionary claim against the appellant in respect of that amount shown as credit on the machine at that stage. In my opinion this amount was wrongly included in the claim and the appeal should be allowed to the extent of reducing the judgment by excluding this amount, and limiting the judgment amount to $8,119.24, derived as I have just explained. The appeal however should be otherwise dismissed. Because this point was not raised by the appellant, and because the matters raised by the appellant have not be successful, and the object of the appellant was to have the judgment wholly set aside, the appeal has not been a success, and the appellant should pay the costs of the appeal to be assessed.
- [42]The amount of interest should be adjusted proportionately to the reduction in the amount of the claim. On my calculation that reduces the interest payable to $1,085.53. The costs of the Magistrates Court’s trial would still be assessed on Scale E, so the figure allowed by the Magistrate of $5,017 ought not to change. The total judgment therefore, inclusive of interest and costs comes to $14,221.77.
- [43]The orders on the appeal are therefore:
- Appeal allowed in part.
- Judgment of 19 June 2001 varied by substituting judgment that the appellant pay to the respondent the amount of $14,221.77, including $1,085.53 interest to the date of judgment, and $5,017 for costs.
- The appeal is otherwise dismissed.
- Order the appellant to pay the respondent’s costs of and incidental to the appeal to be assessed.
Footnotes
[1] Examples appear on Exhibits 13, 14.
[2] $62,288.80 - $52,701.60, the reading on 1 February 1993 (the 92 on the card is clearly an error): Exhibit 7.
[3] Mr. Newton: p.39; Mr. Shelton p. 53.
[4] The Magistrate delivered an ex tempore judgment which focused on the factual issues raised at the trial although a number of technical defences are also dealt with.
[5] Uniform Civil Procedure Rules r. 149(1)(e).
[6] See also Pohlmann v. Harrison [1995] 2 Qd.R. 59 at 62.
[7] Section 143 applied to the trial in this case in the Magistrates Court: see Evidence Act 1995 s. 5.
[8] Obtained by subtracting from the tote meter reading on 30 September 1999 - $70,730.54 – the tote meter reading on 24 May 1996: $62,288.80.