Benseman v Noosa Cat Australia Pty Ltd
[2001] QDC 77
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- Benseman v Noosa Cat Australia Pty Ltd[2001] QDC 77
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Benseman v Noosa Cat Australia Pty Ltd[2001] QDC 77
Benseman v Noosa Cat Australia Pty Ltd[2001] QDC 77
DISTRICT COURT OF QUEENSLAND
CITATION: | Benseman v. Noosa Cat Australia Pty Ltd [2001] QDC 077 |
PARTIES: | JOHN BENSEMAN (Plaintiff) and NOOSA CAT AUSTRALIA PTY LTD (Defendant) |
FILE NO/S: | Plaint No. 258 of 1998 |
DIVISION: | Civil |
PROCEEDING: | Trial |
ORIGINATING COURT: | Maroochydore District Court |
DELIVERED ON: | 2 May 2001 |
DELIVERED AT: | Maroochydore |
HEARING DATE: | 14 – 16 March 2001 |
JUDGE: | K S Dodds DCJ |
ORDER: |
|
CATCHWORDS: | JUDGMENTS AND ORDERS – Setting Aside – Application to set aside judgment – judgment in previous trial was obtained by fraud – whether fraud should have been discovered before the first trial – damages Cases cited Cabassi v. Vila (1940) 64 CLR 130 Boughen v. Abel (1987) 1 QdR 138 Wentworth v. Rogers (No.5) (1986) 6 NSWLR 534 Neat Holdings Pty Ltd v. Karajan Holding Pty Ltd (1992) 110 ALR 449 Briginshaw v. Briginshaw (1938) 60 CLR 336 Re Dawson Decd. (1966) 2 NSWR 211 |
COUNSEL: | S S W Couper QC and P Cronberg for the plaintiff G D Garrick for the defendant |
SOLICITORS: | Tavoularis & Company for the plaintiff Rigby Lawyers for the defendant |
- [1]This is an action to set aside a judgment for the defendant against the plaintiff given in the District Court Maroochydore on 6 March 1997 and perfected on 11 April 1997 and for loss caused thereby. The cause of action is that the judgment was obtained by fraud.
- [2]The plaintiff is the owner of 1994 Powercat 288. It is a 28-foot powerboat which utilises twin-planing hulls spanned by a deck or floor, instead of a single hull.
- [3]At all times when dealing with the defendant the plaintiff dealt with Wayne Leslie Hennig (Hennig). Hennig is a director and was the directing mind of the defendant.
- [4]In 1990, the plaintiff lived and worked in the New Guinea area. In that year whilst in Australia, the plaintiff delivered the boat to the defendant. The plaintiff was interested in having the boat converted from inboard engines with an outboard leg to outboard drive. Such work included manufacturing and fitting outboard pods and filling the transom and floor of the existing engine bays. The plaintiff paid $5000 to the defendant. He also delivered the two inboard engines to the defendant. The arrangement was that the defendant would sell the two engines and the plaintiff and the defendant would share equally in the money obtained. The plaintiff’s share of the money obtained was to go towards payment of the work. There was also some rot apparent in the floor of the boat and that was to be repaired. The plaintiff then departed Australia.
- [5]Later in 1990, the plaintiff returned to Australia and went to the defendant’s premises. The floor of the boat had been removed and it was apparent there was more rot than originally thought. He paid a further $5000 to the defendant. The amount credited to him from the sale of the old engines was $1200.
- [6]In January 1991, the plaintiff was again in Australia and saw his boat. At this time the new floor had been installed and it was not possible to see the work done in the area beneath it. This included in the hulls.
- [7]In mid 1991, the defendant informed the plaintiff that the work on the boat had been completed. By this point in time the plaintiff had paid and/or been credited an amount of $11200.
- [8]From 1991, on a number of occasions, the plaintiff requested an itemised account for the work that had been performed. Eventually in January 1994, he received an itemised invoice or account dated 14 December 1993. The total of that invoice, not including sales tax, was $33739.80. After crediting $11200, the balance claimed owing was $22539.80.
- [9]The invoice purported to contain a list of and charges for materials used in work done on the boat and times and charges for labour. Accompanying the invoice was a letter from the defendant in which the author, Hennig says inter alia:
“It is not possible to fully itemise all the jobs as you request as several jobs were carried out at one time.
Your initial request was to remove the diesel stern drives and convert the transom to accept pods and outboards and a “minor repair” to a small “soft spot” in the floor about 12 inches in diameter.
Once the “soft spot” was opened up it was found that all the bearers, bulkheads and the complete floor was rotted out”.
- [10]The plaintiff then engaged MacGillivays Solicitors to act on his behalf. It was his contention that the $11200 he had already paid was the agreed cost for all work other than the addition of a cabin bulkhead and some other relatively minor work which was to be performed. In April 1995, he engaged Mr John Young (Young) to provide a report to him on the value of the work the defendant had said it had done. Following provision of that report he paid the defendant a further sum of $6200.
- [11]There followed correspondence between the plaintiff solicitors and the defendant solicitors. The defendant’s solicitors said the $6200 would not be accepted as full and final payment of moneys owing for work done on the boat and that the defendant would sue for the balance owing. The plaintiff’s solicitors said that the plaintiff considered that he only owed the defendant $6200 and that since he had paid or offered to pay that he was not at risk for interest or costs at any subsequent trial. They invited the defendant to institute proceedings and they would accept service. The defendant’s solicitors replied that the cheque for $6200 would be accepted in part payment and that the defendant would continue to maintain a lien over the boat and trailer until payment of the full amount claimed.
- [12]On 25 October 1995 the plaintiff issued out of the District Court Maroochydore a plaint seeking delivery up of possession of the boat and damages for breach of contract and/or wrongful detention and/or trespass. In it he alleged that the agreements between he and the defendant were that the defendant would carry out work on the boat only to the extent of money paid to the defendant and money credited to the plaintiff as a result of the sale of the old engines and would not proceed with work beyond that without further agreement.
- [13]He alleged the work agreed to in or about March 1990 included:
- conversion from inboard to outboard motors involving manufacturing and fitting of outboard pods and filling the transom and floor over the engine bays;
- repairs to the floor where it had been damaged and rotted and the replacement of the wooden fender strakes with rubber fender strakes.
- [14]He alleged the work agreed to in or about August 1990 included:
- replacement of part of the floor including the crossmembers (the support structure of the floor)
- installation of extra fuel tanks and under floor iceboxes.
- [15]In its entry of appearance and defence the defendant admitted delivery of the boat to it in early 1990 and that it had agreed to carry out certain work at the request of the plaintiff. In particularised that work as:
- conversion from inboard to outboard motors;
- the fitting of outboard pods;
- all necessary work associated with the removal of the floor of the boat from the transom to the dash and the removal of all rotten timber bulkheads and replacement with fibreglass bulkheads;
- installation of additional bulkheads required for the conversion from diesel stern drive to outboard pods;
- installation of floor beams (crossmembers);
- installation of a new fibreglass floor from the dash to the transom.
It further alleged that in or about 1991 at the request of the plaintiff it agreed to carry out further work. It particularised that as installation of:
- in floor iceboxes;
- above floor iceboxes;
- a cockpit sink;
- stainless steel racks;
- a rear stainless steel frame for an awning;
- extra fuel tanks;
- heavy duty side fenders
It alleged the agreement between it and the plaintiff had been to perform the work which had been performed on reasonable hourly rates for labour plus materials.
- [16]I have already mentioned that Young was commissioned by the plaintiff to provide a report about a fair and reasonable charge for the work done on the vessel before he issued his plaint. A large number of hours of labour were included in the invoice but it did not specify the tasks those hours related to. Indeed it did not make any reference to particular work. Young was provided with a copy of the invoice that had been provided by the defendant. He asked Hennig to show him through what the defendant had done and Hennig did so. That included a tour of parts of the factory where moulds used to manufacture bulkheads and bearers were indicated. He was told brand new moulds were made in order to make the bulkheads and bearers (an integrated unit) installed in the boat. It was indicated how repair had been done using standard construction methods for new Sharkcats on a partially complete new boat in the factory. Young asked Hennig for a statement in writing of the work carried out under the floor of the boat because that was not visible without cutting reasonably large holes in the structure. This was provided under the hand of Hennig dated 27 April 1994 (see Exhibit 20). In it Hennig said that the work carried out included:
- engine boxes, engine beds, transom shields were removed
- rotted external timber rubbing strake was removed and bolts holes filled
- the complete floor up to the dash was removed
- all floor bearers and bulkheads were removed
- original fuel tanks were removed (after boxing over fillers was removed, there was a tank in each hull.)
- the complete interior of the hull from the dash back was dedagged and ground out
- a metal mould was made to make the new floor bearers and a full set of bearers made (normally at 12” centres), fibreglass panels were made and templates were set up for all bulkheads (note as boat was being converted from diesel sterndrives to outboard pods, extra bulkheads and beams were put in place of the engines)
- the stern drive transom cutouts were filled and glassed over. A large bracing gusset was put in place from the transom down to the new keel section in what was the engine bays
- two new fuel tanks were purchased as requested by the owner. Both the original and the two new fuel tanks were fitted onto new fuel tank bases
- all the new bulkheads and floor beams were installed as per our standard construction methods for new sharkcats
- fibreglass floor panels were made and a complete new floor was fitted from the deck to the transom
- a new heavy duty mid rail fender was fitted to each side of the hull
- two second-hand Power Cat iceboxes with under floor drains were received into the cockpit floor.
It continued that it was a summary of “the work carried out under the floor only. There was a good deal more detailed work carried out above the floor in building custom iceboxes and lockers as directed by [the plaintiff]”.
- [17]Young then prepared his costings for the work claimed to have been done and provided it to the plaintiff.
- [18]It appears that after the plaint had issued the defendant arranged for Terrence Davis (Davis) said to be a certified shipwright to provide a report on appropriate costs for materials and labour for the work claimed done by the defendant. Davis worked for the defendant. Davis’ report supported the charge made by the defendant.
- [19]Following Davis’ report the plaintiff commissioned John Fowles (Fowles), a marine surveyor to report on a fair and reasonable cost for the work and labour claimed done and the materials used. When the defendant would not agree to allow Fowles to inspect the boat an order of the court was sought and obtained to facilitate that. Fowles prepared his report using Davis’ labour descriptions and the defendant’s invoiced pricing.
- [20]At the trial that resulted in the judgment sought to be set aside, Hennig said that the defendant only did work which the plaintiff authorised it to do, in particular, after the deck had been removed and the rotting components were exposed, the plaintiff authorised the defendant to do the work that was necessary to restore the boat. It was the work set out in Exhibit 20. Michael Fray (Fray), a fibreglasser employed by the defendant who it was said performed a great deal of the work on the boat also gave evidence. It was never in issue in the proceeding that the work done below deck was not that described in Exhibit 20.
- [21]The trial judge found that the agreement was that contended for by the defendant. She then proceeded to a determination of fair and reasonable remuneration for the work which the defendant claimed had been done. She accepted the evidence of Fowles rather than that of Davis or Young. She thought he was the only completely disinterested expert. She noted that all the experts (other than Hennig) were at a disadvantage in not seeing the actual work that needed to be done when the floor was removed. She expressed some concern that the original source documents for the work done, employees’ work sheets, were missing. Such work sheets apart from noting the hours worked, according to Fray, also set out broad detail of work actually performed. She also considered it regretable and of concern that no account of labour or materials had been given to the plaintiff despite his many requests between 1991 and 8 January 1994. She concluded that a fair and reasonable cost for materials and labour supplied by the defendant was $23729.30 less $17400 already paid, leaving an amount owing of $6329.30. She declined to allow any sum for sales tax or for storage. She gave judgment for the defendant against the plaintiff on the counter-claim for $9723.84 being $6329.30 for the claim on a quantum meruit and interest in the sum of $3394.54. She dismissed the plaintiff’s action.
- [22]On 30 April 1997, the plaintiff paid the judgment sum of $9723.48 and on 8 July 1997 he paid the sum of $4904.80 for costs. He then arranged for the pick up and delivery of the vessel to Mooloolaba. Young was commissioned to perform necessary work on the vessel to put it into seaworthy condition and arrange for its delivery to New Britain where the plaintiff lived and worked.
- [23]I accept Young’s evidence in the trial before me about what he observed and what occurred after the boat was delivered to him. He found a large amount of water in the compartments of the hulls which should not have been there. After speaking with the plaintiff, inspection holes were then cut into the compartments. It was found that a large amount of work which was said to have been done inside the twin hulls, which had been charged for and which charges had been included in the judgment on the counterclaim, had not been performed. Specifically, all the bulkheads which Hennig had said had been removed and replaced by all fibreglass bulkheads (eight in each hull), had not been removed and replaced, except for one at the stern where the motors had been. They were still there in their original form, ply with fibreglass coating. The ply was water logged and in some bulkheads rotten. The inside of the hulls had not been sanded and dedagged except to the extent of less than 3 m² of a possible 46 m². The old fuel tanks had not been removed and replaced on a new bed as had been claimed. Most of the original engine bay structures including engine beds were still in place. Two original half timber bulkheads had been displaced by the new additional fuel tanks and had been replaced by a timber fuel tank base and timber supports.
- [24]In assessing damages based upon Fowles’ report, the trial judge proceeded on the basis that the defendant had removed engine boxes, engine beds and transom shields, removed rotted external timber, removed rotting strakes, filled boltholes, removed the complete floor up to the dash, removed floor bearers and bulkheads, removed the boxing over the fillers and the original fuel tanks, dedagged the complete interior of the hull and ground it out, constructed a metal mould from which to make new floor bearers and a full set of fibreglass bearers set at about 12 inch centres, constructed fibreglass panels and templates for all bulkheads including extra bulkheads and beams because of the conversion from diesel stern drive to outboard pods, filled and fibreglassed over the stern drive transom cut out, placed a large bracing gusset from the transom down to the new keel section in what had been the engine bays, installed new bulkheads and floor beams in accordance with standard construction methods for new Sharkcats and installed new fibreglass floor panels and fibreglass floor from the dash to the transom.
- [25]The plaint in the present action was issued on 16 July 1998. In January 1999, Hennig, Fray and Davis inspected the boat at Laurie’s Marina at Mooloolaba. The hulls had been opened allowing inspection of the inside of all compartments and the work which had been done or not done below the floor in the hulls was apparent.
- [26]On 15 February 1999, the defendant filed its entry of appearance and defence. It denied the allegation in paragraph 12 of the plaint that the defendant had not carried out the work as described in evidence at the previous trial. That denial was persisted in until it sought leave at the start of the trial to amend its defence to admit that two engine beds had not been removed, that eight bulkheads had not been removed and that no new keel sections were fitted to engine bays. It continued to deny that very little of the underfloor area had been ground or dedagged, that the original fuel tanks had not been removed, that no new fuel tank bases had been fitted rather alleging that two new fuel tank bases were fitted, denied that the two fibreglass bulkheads which had been fitted were not fitted in accordance with standard construction methods for new Sharkcats and that fuel tank structures had not been constructed in accordance with standard construction methods for new Sharkcats. It also denied that Hennig knew the evidence he had given in the previous trial was false and that he had given the evidence recklessly and carelessly, not caring if it was true or not.
- [27]As appears above the removal and replacement of the old fuel tanks remained in contention in the trial before me. I find that the old fuel tanks were not removed and replaced. The hoses and clips have clearly not been removed. The tanks also contained a large amount of diesel fuel (for the inboard motors) when the plaintiff regained possession of the vehicle. That fuel could not possibly have remained in the tanks had they been removed.
- [28]Apart from any other source of knowledge, it was or should have been apparent after inspection in January 1999 that a large amount of the under floor work claimed to have been done had not in fact been done. That included removal and replacement with fibreglass bulkheads of bulkheads up to the cabin in both hulls apart from the one bulkhead installed in each hull in the stern, necessitated by the conversion from inboard to out board engines. It included removal of the old engine beds. They were not removed. Only a small piece was cut from two of them for icebox drains where the iceboxes had been let into the floor after the new floor had been installed. It included grinding out and dedagging the whole of the inside of each hull. In fact only about 3 m² of a possible of 46 m² was ground and dedagged. It may have included removal of the old fuel tanks (one in each hull) provision of new beds for them and their reinstallation. All that had been done was to supply and fit two additional (new) fuel tanks on a timber base. It included removal and replacement of the keel section in the engine bays. All that had been done was a bracing gusset was attached to the existing keel at the stern to stiffen the structure for the outboard motor pods.
- [29]In summary the only work in fact done under the floor was to install one fibreglass bulkhead in each hull, fit new fibreglass under floor support bearers from hull to hull to support the floor, do some minor grinding where the new support bearers joined the hulls, provide timber fittings and bases for two additional fuel tanks fitted, provide bracing gussets at the stern and let iceboxes into the hulls through the floor after the new floor had been laid. Moreover, the quality of work below the floor in the areas of the attachment of the support bearers was poor. That is evident from the evidence of Young (see his report Exhibit 33 and photographs therein).
- [30]Hennig’s position in the trial before me was that at the time of the earlier trial he believed that the work claimed done under the floor had been done. That belief he said, had been fostered by a recall of seeing men working on the boat from time to time in 1990 and 1991, observing the work that was being done from time to time and from inquiry of his work men particularly Fray about the work that had been done. As in the previous trial he had no record of the work done by men who had worked on the boat which set out what they had done. He had sheets showing hours and materials used which he had compiled from the workmen’s worksheets. I find though that written descriptions of work performed on the boat had at some stage existed because the work sheets the men were required to complete included a description of the work they had done, the hours spent doing it and the materials used (see the evidence of Fray in this trial). Hennig said that in 1993 when he was preparing the invoice from his sheets showing hours and materials and thereafter he had attempted from his recollection of what he had seen and from his discussions with Fray to gather what work had been done below the floor of the boat and had come to believe that what he had told Young and said during the trial had in fact been done. That had been demonstrated to be wrong.
- [31]There is no doubt a judgment obtained by fraud may be set aside: Cabassi v. Vila (1940) 64 CLR 130 at 147; Boughen v. Abel (1987) 1 QdR 138. As Connolly J put it in Boughen, what must be reconciled are the principles that fraud vitiates a judgment and the public interest in the finality of litigation. They “are reconciled by the requirement that the party seeking to set aside a judgment on the ground of fraud produce evidence of facts discovered since the judgment complained of”: at 140, 141.
- [32]In Wentworth v. Rogers (No.5) (1986) 6 NSWLR 534 Kirby P in his reasons for judgment in which Hope and Samuels JJA agreed discussed the principles involved in a proceeding to set aside a judgment obtained by fraud. He noted that such proceedings are equitable. The principles included that the party asserting the judgment should be set aside must show that there has been a new discovery of material evidence which had it been available at the trial would probably have effected the outcome of the trial. There must be clear evidence of fraud and the successful party must be shown by admissible evidence to have been responsible for the fraud which taints the judgment so that it would be inequitable they should take the benefit of it. Ordinarily proof of perjury without more will not be sufficient to attract the exceptional relief involved in the setting aside of a judgment. There is a public interest in finality of litigation.
- [33]In Monro Schneider Associates (Inc) & Anor v. Number 1 Raberem Pty Ltd & Ors (No.2) (1992) 37 FCR 234 the Federal Court then consisting of Spender, Gummow and Lee JJ examined the law in Australia on setting aside a judgment for fraud. The court considered the law was to the same effect as set out in the judgment of Lord Bridge delivering the judgment of the House of Lords in Owens Bank Ltd v. Bracco (1992) 2 AC 443 at 483. It summarised the position at 241 of the judgment as:
- (a)the evidence involving fraud (must be) newly discovered since the trial;
- (b)the evidence…could not have been found by the time of the trial by exercising reasonable diligence;
- (c)the evidence (was) so material that its production at the trial would probably have effected the outcome and when the fraud charged consists of perjury then;
- (d)the evidence must be so strong that it would reasonably be expected to be decisive at a rehearing and if unanswered must have that result.
- [34]There are any number of cases which discuss the proof required for a finding of fact in a civil action. Proof is on the balance of probabilities even when the allegation is one of fraud. Neat Holdings Pty Ltd v. Karajan Holding Pty Ltd (1992) 110 ALR 449. The type and seriousness of the allegations involved may affect the strength of the evidence required for proof but the standard of proof is not altered. Briginshaw v. Briginshaw (1938) 60 CLR 336. Neat Holdings Pty Ltd.
- [35]I did not find Hennigs evidence convincing. True it is that the trial Judge’s findings in the previous trial were that the arrangement between the plaintiff and Hennig was that the defendant would repair the boat and charge a reasonable rate for labour and materials. That sort of arrangement may provide some explanation for an apparent failure to preserve the employees worksheets. On the other hand there was and is no doubt the plaintiff was requesting an account of work done on the boat from as early as 1991. Although the defendant already had $11,200 of the plaintiff’s money there appears no satisfactory explanation why an account was not compiled until December 1993. Hennig said he had inspected the work from time to time as it was being done and had discussed with employees the work being done.
- [36]The trial Judge at the earlier trial assessed a fair and reasonable charge for the work the defendant claimed had been done. The starting point for the labour component was the hours said to have been worked and recorded from the employees work sheets. Ultimately the trial Judge did not accept that the hours of labour claimed in the defendant’s evidence were fair and reasonable for the work claimed done. Rather she accepted the evidence of Fowles, who based his hours on Davis’s labour descriptions.
- [37]The real position however, which has now become evident, is that quite an amount of the work said to have been done was not done. The time sheets said to be a record of the hours worked on the jobs described by Davis therefore must record an even more excessive number of hours to do the work that was actually done. The inferences available are that the hours on the timesheets have been padded out to justify the work that was claimed to have been done or that the defendant’s workers were falsely recording the hours worked on the boat on their work sheets. It would mean workers, for instance Fray who was supposed to have done a lot of the work on the boat, were inefficient and/or dishonest tradesman. Hennig though said that Fray was a good worker.
- [38]I do not accept Hennig’s claim that when he compiled and produced exhibit 20 for Young and thereafter supported its contents as being the work done to the plaintiff’s boat including in his evidence in the previous trial, he had an honest belief all that work had been done. I do not find credible his claim that he truly believed what were in fact falsehoods when he compiled and provided exhibit 20 to Young and thereafter supported those details of the work at the earlier trial.
- [39]I find that fraud is proven. At the very least the claims by the defendant regarding the work done were recklessly and carelessly made not caring if they were true or false.
- [40]Should the work subsequently discovered not done have been discovered before the first trial. In the trial before me, Young said, and I accept, that when he was commissioned to provide a report to the plaintiff he was not asked to check on the extent of the work that had been done although to complete his report he needed to understand what work had been done. Fowles said, and I accept, that when he was commissioned to provide a report to the plaintiff he was not commissioned to check on the actual work done below decks but to provide a report about the cost of materials and the labour which was claimed. Even if the exercise of reasonable diligence is required where fraud is proven (as opposed to deliberately lying by) I do not think the plaintiff fails. It may be the case as the defence submitted that the plaintiff appears to have been of the view that what was to be replaced under the floor were the cross members rather than bulk heads or cross members and bulk heads. However I do not think it matters. The matter in dispute was whether the agreement between them was that contended for by the plaintiff, namely that work was not to proceed beyond what he had already paid without further agreement or that contended for by the defendant, namely that the defective parts of the boat revealed when the floor was taken up would be repaired or replaced and the defendant would be paid a reasonable sum for labour and materials. The defendant (Hennig) was apparently a reputable boat builder/repairer. Hennig was known to both Young and Fowles. He said the work had been done. The reason for the employment of Young and Fowles was to assess what was a fair and reasonable price for the work, which Hennig said, had been done. To independently check under the floor holes would have to be cut into the compartments in each hull necessitating further expensive repair work. The one inspection port, which then existed in each hull, allowed a view of the one new fibreglass bulkhead in the stern where the old motor compartments had been. No doubt the new iceboxes could have been unscrewed and lifted out which would have revealed the old engine beds still largely in place. But as Young said, at the time there was no reason to doubt that if Hennig said the work had been done, it had been done. Fowles was of similar mind. He raised a possible inconsistency relating to what was underneath the old original fuel tanks and what was under the new additional fuel tanks. There appeared to be foam under the old tanks. They had originally been installed in foam. He was not required to investigate further. However I do not think this shows a lack of reasonable diligence on the plaintiff’s part. As I have already observed the work Hennig said had been done under the floor was not an issue. The issues were the agreement and the reasonable price for labour and materials for the work Hennig said had been done.
- [41]It is plain that if the true situation had been known at the time of the previous trial the judgment given on the counterclaim would not have been given. The fraud which was perpetrated plainly lead to the judgment given on the counterclaim. And the defendant through its directing mind Hennig was plainly responsible for it.
- [42]I conclude therefore that the judgment obtained by the defendant in the previous trial should be set aside for fraud.
- [43]The plaintiff seeks compensation for his loss as a result of the fraud. I consider he is entitled to such amount as is just and equitable to compensate him for his loss and damage.
- [44]In Re Dawson Decd. (1966) 2 NSWR 211 a case where a trustee had improperly paid away trust monies in New Zealand pounds Street J, as he then was, when considering whether the amount to be repaid by the trustee should be assessed at the time of the breach or at the time of the proceedings when its value was greater said “the inquiry in each instance would appear to be whether the loss would have happened if there had been no breach”. He assessed the amount at its greater value at the date of the proceedings. See also at paragraphs 2303 and 2304. “Equity Doctrines and Remedies” Meagher Gummow and Lehane 3rd edition.
- [45]I find as follows:
The plaintiff may recover the amount of the interest he paid on the judgment in the previous trial in all $3,394.54.
He may also recover the costs he paid $4,904.80.
- [46]Prior to the earlier trial the plaintiff made an offer to settle under part 9 of the then Rules of the District Court in the sum of $8,000.00 for his claim and interest together with the defendant’s reasonable party and party costs which was not accepted. It was conceded by the defendant before me that in the situation now prevailing it was not possible to argue that if the plaintiff were to be awarded the costs of the previous trial they should not be on a solicitor and client basis.
- [47]There is also a claim for the recovery of the fees paid to Young and Fowler before and in relation to the previous trial. The amount is $12,028.50.
- [48]The plaintiff is entitled to a refund of that part of the monies paid as a result of the judgment in the previous trial for work claimed done but not in fact done. The amount is $4,040.00.
- [49]The plaintiff is entitled to be paid that part of the monies paid as a result of the judgment in the previous trial for work done which is of no value to the plaintiff because it will have to be undone and redone to do the work below decks the defendant claimed to have done but did not and which must be done to properly repair the boat.
- [50]The defendant contended that the work below deck required to now properly repair the boat is probably due to time and events post the fitting of the new floor. It contended therefore that the defendant should not be required to pay this amount.
- [51]I do not agree. The defendant kept possession of the boat until about 8 July 1997. The defendant did not do the work it said was required and said it did. The bulkheads require replacement. The evidence suggests they required replacement in 1990. Water has been getting into the compartments in the hulls. It should not have been. Work done by the defendant will have to be undone and redone to enable replacement of the bulkheads. I accept Young’s evidence about this. The plaintiff is entitled to an amount of $5,799.24.
- [52]The plaintiff also claims for out of pocket expenses incurred as a result of the fraud. The expenses are for a number of trips, which he made from where he lives and works in New Britain to Brisbane and the Sunshine Coast.
- [53]I accept the plaintiff’s evidence that communication with the outside world is difficult in New Britian and that it was necessary for the plaintiff to make trips to Brisbane. I accept the plaintiff’s evidence about the difficulties he faced getting leave and arranging transport and necessary conferences when in Brisbane. I accept that each return trip involved at least 2 full days of travelling. However I think that some of the trips and some of the periods of time for which the plaintiff claims accommodation costs are not reasonably to be charged to the defendant.
- [54]The plaintiff’s claim includes the following:
- (a)21 days between the 9th February 1997 and the 2nd March 1997. This included the period of the first trial which occupied one and a half days on the 20th February 1997 and the 21st February 1997.
Taking into account the need to prepare for the trial and make any necessary arrangements after the trial I assess a period of 10 days accommodation.
- (b)12½ days between the 5th July 1997 and 30th July 1997. The apparent purpose was to collect the boat and arrange for its preparation for export to the plaintiff’s place of residence in New Guinea. Judgement was given on 6 March 1997. The plaintiff paid the judgment sum on 30 April 1997 and costs on 8 July 1997. I assess 5 days accommodation.
- (c)12½ days between 20th November 1997 and 14th December 1997. This trip occurred after Young contacted the plaintiff about what had been discovered about work not done that had been claimed to have been done. It apparently involved inspecting the boat and seeing lawyers and discussions with Young and Fowles. I assess 7 days accommodation for this trip.
- (d)15 days between 12th June 1998 and 12th July 1998. It was apparently to see lawyers, execute documents and initiate the action. I assess 3 days accommodation for this trip.
- (e)10 days in October 1998 apparently to assist in the compilation of further and better particulars. I assess 3 days accommodation.
- (f)14 days between 9th May 1999 and 23rd May 1999. It was apparently to provide instructions in the discovery process. I assess 3 days accommodation.
- (g)12½ days between 16th November 1999 and 12th December 1999. It was apparently associated with a request for further and better particulars. I assess 3 days accommodation.
- (h)14 days between 9th January 2000 and 23rd January 2000. It was apparently to have a conference with barristers, particularly a QC who was to lead in the action. I assess 3 days accommodation.
- (i)12 days between 26th November 2000 and 20th December 2000. It was apparently for conferences for preparation for trial.
- (j)18 days in February 2001. This trip was for the purposes of the present trial.
I assess a total period of 7 days accommodation for both (i) and (j). I consider that includes a reasonable period for conferences and the trial.
- [55]The total accommodation allowed amounts to 44 days. The cost of accommodation for the period is assessed at an amount of $2,417.30.
- [56]The plaintiff also claims for overpayment of sales tax on what he paid the defendant in total. The amount is $845.83.
- [57]The plaintiff also claims damages of $10,000 for being kept out of the possession of the boat by the defendant’s exercise of its lien which is now seen to be without justification and for the cost of storage of the boat for the purposes of the trial before me.
- [58]The claim is for a relatively nominal sum. There was no evidence about any consequential damage to the plaintiff because he did not have possession of the boat during the period up until about 8 July 1997. It was however quite a substantial period of time. There was evidence about the cost of storage of the boat at Mooloolaba to date of trial in the sum of $5,034.20. See Exhibit 31. I assess damages in the sum of $10,000.
- [59]The following amounts then are due to the plaintiff:
| Interest on previous judgment | $3,394.54 |
| Costs paid by the plaintiff as a result of the judgment set aside |
4,904.80 |
| The plaintiff’s legal costs of the previous trial on a solicitor/client basis. I am not asked to attempt to quantify them. |
|
| The fees paid to Young and Fowles as experts for the previous trial |
12,028.50 |
| Refund of money paid by the plaintiff to the defendant for work claimed done but not done |
4,040.00 |
| Refund of money paid by the plaintiff to the defendant for work which will have to be re-done |
4,799.24 |
| Out of pocket expense for trips from New Britain to South East Queensland incurred because of the fraudulently obtained judgment. The amounts claimed are set out in Exhibit 3. I have not allowed all the amounts claimed. Using the headings in Exhibit 3, the amounts will be: |
|
| Air fares | 12,403.07 |
| Accommodation | 2,417.30 |
| Taxi fares | 225.00 |
| Car hire | 2,484.47 |
| Out of pocket expense incurred and associated with the previous trial. The claim is contained in exhibit 4. Of the amounts claimed therein, the accommodation costs are reduced to $603.00 and the costs on the collection of vessel are deleted. Costs would have been incurred in any event by the delivery of the boat for repair and collection of the boat after repair. The amount is reduced to $2,071.78. |
2,071.78 |
| Refund of overpayment of sales tax. Sales tax was calculated as due on the value of the work the defendant claimed it had done. It was paid. In his evidence, Young demonstrated the amount of sales tax overpaid when regard is had to what is now known about the work in fact done and the materials used therein. See exhibit 45. The overpayment was $845.83. |
845.83 |
| Storage and deprivation of possession of the boat | 10,000 |
| Total | $59,614.53 |
- [60]I order the judgment of the District Court at Maroochydore given on 6 March 1997 and perfected on 11 April 1997 re plaint number 186 of 1995 Maroochydore registry between John Benseman plaintiff and Noosa Cat Australia Pty Ltd defendant be set aside.
- [61]I assess damages for the plaintiff against the defendant in the sum of $59,614.53 together with the amount of the plaintiff’s costs of the previous trial to be assessed on a solicitor/client basis.
- [62]Interest will be awarded on the total amount of damages at the rate of 8% from 16 July 1998 to the date of judgment. By using the rate of 8% I have allowed for the fact that out of pocket expenses were incurred over a period subsequent to 16 July 1998.