Allens Services Ltd (in liq) v Frederick Matheson t/a Excavator Rentals Qld
[2004] QDC 90
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- Allens Services Ltd (in liq) v Frederick Matheson t/a Excavator Rentals Qld[2004] QDC 90
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Allens Services Ltd (in liq) v Frederick Matheson t/a Excavator Rentals Qld[2004] QDC 90
Allens Services Ltd (in liq) v Frederick Matheson t/a Excavator Rentals Qld[2004] QDC 90
[2004] QDC 090
DISTRICT COURT
CIVIL JURISDICTION
JUDGE McGILL SC
No BD781 of 2003
ALLENS SERVICES LIMITED ABN 59 091 344 535 (IN LIQUIDATION) | Plaintiff |
and | |
FREDERICK MATHESON TRADING AS EXCAVATOR RENTALS QLD (A FIRM) | Defendant |
BRISBANE
DATE 14/04/2004
ORDER
HIS HONOUR: This is an application seeking to substitute for the plaintiff a company Scottish Pacific Business Finance Proprietary Limited. The existing action is suing on debt alleged to have arisen as a result of a hire by the plaintiff to the defendant of two excavators in the year 2002. Specifically, an amount totalling $76,218.09 was the subject of a number of invoices which are pleaded expressly in paragraph 14 of the existing statement of claim.
Some time in December 2002, the defendant received notice of an assignment of that debt arising in respect of that hire to a company Scottish Pacific Business Finance Proprietary Limited. Nevertheless, the claim was originally brought in the name of the company with whom the defendant had previously been dealing, Allens Services Limited, when the claim and statement of claim were filed in March 2003.
The defendant filed a notice of intention to defend and defence in response to that claim on the 6th of June 2003.
There was subsequently an application for summary judgment which came on before another Judge in December last year, which was subsequently adjourned.
The plaintiff, the existing plaintiff and Scottish Pacific Business Finance Pty Ltd, are now seeking that that company be substituted as plaintiff and that then that company have leave to amend the claim and statement of claim in order to plead the claim by that company in its own name, and that there then be a summary judgment in respect of that claim pursuant to Rule 292.
It seems clear that it ought to have been Scottish Pacific Business Finance Pty Ltd that pursued this claim, having taken a legal assignment of the debt and that it is the appropriate plaintiff and should have sued in its own name.
The defendant said that what he wanted to see was for the existing action to be discontinued and for that company then to commence fresh proceedings. But substituting that company as plaintiff would achieve much the same practical result but with less unnecessary delay and would avoid unnecessary legal work which would otherwise have to be incurred for no good purpose and it would be consistent with the general approach to procedural matters for the order to be made.
It seems to me that the defendant is not prejudiced by the order and that it is appropriate to substitute that company as plaintiff and to give leave as the result to make the relatively minor amendments to the plaintiff's statement of claim so that it becomes a claim on behalf of that company.
The more substantial issue then is the question of summary judgment. The plaintiff relies on two documents signed by the defendant and dated 11 September 2002 and an annexure setting out some details of the two particular machines hired and the consideration which was also signed by the defendant and dated by him 11 September 2002.
The other two documents signed are headed Equipment Hire Quotation Schedule and recite that:
"This equipment hire quotation schedule is an integral part of the equipment hire agreement and must be read in conjunction with the terms and conditions of that document."
The equipment hire agreement itself is a short document which is intended to be used in conjunction with the schedule but is also intended to be executed. It refers to the terms and conditions and those are then attached. They run from pages 8 to 17 of the document.
The defendant submitted that because he did not sign the document setting out the terms and conditions and that they had not been provided to him prior to the time when he signed the quotation schedule, that he was not bound by those terms and conditions. But the document that he did sign did refer to the terms and conditions and it then becomes a matter of the construction of that document as to what is meant by it, and whether the signing of that document coupled with the provision by Allens Services Limited to him of the equipment referred to in the quotation schedules and in the annexure which he signed amounted to a contract between the parties which incorporated those terms and conditions.
The fact that they were not physically part of the document signed and the fact that they were not actually provided to the defendant prior to his signature are not things which prevent that result. It is quite possible that on the true construction of the contract those terms and conditions are incorporated.
Even if he has never seen them up until that time there is plenty of authority to that effect and indeed there are cases involving terms included in contracts by incorporation by way of reference on things like railway tickets and so on, so that proposition is well established.
The plaintiff says that a copy of the full document was provided to him, but that is denied by him. Assuming that Mr Matheson is correct and that he had not been provided with a copy of the full document and with the terms and conditions, nevertheless by signing the quotation documents he has in my opinion agreed to contract in terms which incorporate those terms and conditions whether or not he had already seen them.
Accordingly there is no substance in that aspect of his submissions. He said that he did not see the terms and conditions until a copy was forwarded to him at the end of October 2002 in conjunction with another quotation. That may well be right, but it is not something which assists him in showing any defence.
The next matter which he raises is that the contract was intended to be and was dealt with on a contra hire basis, that is to say that he would hire other equipment to Allens Services Limited so that the hire of that equipment will be set off against the hire of this equipment to extinguish it. In other words, it was something like a kind of barter arrangement and that this was why he was willing to enter into the hire agreement and that he had a collateral verbal agreement made with Allens Services Limited through its Brisbane manager that that arrangement would be made.
That is disputed by Allens Services Limited and by the new plaintiff, but for present purposes it can be assumed that there was such an agreement and indeed that there was other equipment hired for which Allens Services Limited came to be liable for an amount in excess of the amount claimed in the present action, or a failure to do so in breach of that contract.
Assuming that that is the case, the plaintiff submits that nevertheless because of a term in the terms and conditions of hire, the plaintiff is entitled to recover the amount payable in respect of the hire of this equipment free from any set-off or counterclaim, and hence free from any liability which Allens Services Limited may have to pay the defendant in respect of any equipment hired by the defendant to Allens Services Limited or any agreement between the parties that there would be such hire of such agreement.
Whether the claim is in respect of money owing for goods hired or whether it is damages for breach of the alleged collateral agreement, assuming that there is a good claim which would otherwise be available to extinguish the plaintiff's debt, that is not available because of clause 8(e) of the terms and conditions of the contract.
That clause provides:
"The client must not withhold or make deduction from payment under this agreement due to: ... (ii) an alleged set-off or counterclaim by the client..."
The effect of clauses of this nature has been considered in a number of recent cases. I think it is sufficient to refer to a decision of the English Court of Appeal in Coca Cola Financial Corporation v. Finsatt International Limited (1988) QB 43, Daewoo Australia Pty Ltd v. Portacrane Pty Ltd (2000) QSC 50 and Capital Finance Australia Ltd v. Airstar Aviation Pty Ltd (2004) 1 QdR 122.
In the third of these cases, Holmes J at page 126 referred to a somewhat stronger clause and concluded that the effect of that clause was that a counterclaim could not even be brought and as a result struck out the counterclaim which had been brought in defiance of the contractual arrangement between the parties.
In the present case, the clause is I think not so strong that a counterclaim could not have been brought against Allens Services Limited. However, the defendant submitted, as indeed the defendant put it himself, that when the new plaintiff, Scottish Pacific, took over the debt it took over with it whatever went with it and that the counterclaim was one of the things that went with it.
The point about clause 8(e) is that any counterclaim or set-off was not something which went with the debt and therefore what was assigned to Scottish Pacific was a debt which was free from any set-off or counterclaim.
I do not think that the clause was sufficiently strongly worded to prevent the defendant from pursuing any claim against Allens Services Limited, although that may be cold comfort for him because that company is now in liquidation. But that is not the point.
There is no reason to think that he has any claim arising out of any collateral agreement with Allens Services Limited which may be pursued against Scottish Pacific. That company did not agree to hire any equipment from him and there is no reason why the burden of that agreement, any agreement which Allens Services Limited made, would flow to Scottish Pacific.
The whole point of a clause such as 8(e) is to prevent something like that occurring so that Allens Services Limited can assign the debt free from any such set-off or counterclaim.
In these circumstances, whether or not Mr Matheson had a good claim against Allens Services, it cannot be made the subject of a set-off or counterclaim against Scottish Pacific.
It follows that that aspect of the defence and counterclaim cannot succeed.
Apart from that, it does not appear that there is any substantial dispute either on the pleadings or in the affidavit material filed by the defendant to the plaintiff's claim. There was an issue about whether the document dated 11 September 2002 was actually signed by Mr Matheson on that date or on the 11th August.
It seems to me that assuming that that issue is resolved in favour of the defendant, it does not affect the entitlement to Scottish Pacific to the amounts claimed. There was no dispute from the defendant about the date on which the hire commenced and the agreement which was signed can govern hire which has already occurred as well as hire which occurs in the future.
Accordingly there is, I think, no difficulty about treating that document, assuming it was signed on the 11th September 2002, as the defendant says, as being applicable to the whole of the transaction between the parties.
In those circumstances, it seems to me clear that the plaintiff is entitled to succeed in the claim in respect of the amount of the hire and the debt that was assigned, together with interest, and there is a contractual right in relation to interest which is not the subject of any specific dispute.
The defendant has submitted that the matter ought to go to trial so that the various matters to which he has referred can be investigated, but as I have indicated, assuming that those matters are resolved in his favour at a trial, the plaintiff is still entitled to recover that debt from him, and accordingly in my opinion it is clear that the plaintiff is entitled to succeed in the action and is entitled to succeed both in the claim and in the counterclaim and there is no point in having a trial, and accordingly there should be summary judgment for the plaintiff against the defendant indeed both in respect of the claim and the counterclaim.
There is one aspect which has been raised in the present claim, however, and that is an entitlement to costs under the agreement.
Now, Mr Wilkins, I see in your outline you are not pursuing a claim for costs under the agreement on the part of the new plaintiff.
...
HIS HONOUR: I will write that in specifically. "Pay Scottish Pacific Business Finance Pty Ltd costs of the application for summary judgment and the proceeding to be assessed on the indemnity basis."
There is an entitlement under the contract for costs on the indemnity basis, but they should not include the costs incurred by the previous plaintiff at a time when the previous plaintiff was suing for, of course, a debt that it did not own. So the only costs recoverable under the judgment should be the costs incurred specifically by Scottish Pacific Business Finance Pty Ltd.
It necessarily follows that there will be no order in respect of the costs reserved by another Judge on 1 December 2003.
All right. Mr Matheson, in terms of the form of the order and the judgment, is there anything you wanted to say about the form of these documents?
...
HIS HONOUR: Subject to those amendments that I have made, there will be an order for substitution and then a judgment on the summary judgment application in terms of the drafts.