Slogrove Tobias & Partners Pty Ltd v Janke
[2009] QDC 422
To print this judgment please return to the case and click on the PDF icon
next to the
case name. For court use, a full PDF copy is required or preferred.
Exit Distraction Free Reading Mode
Please Note: You are about to print a copy of the onscreen
version of
this judgment. For court use, a full PDF copy of the judgment is required or preferred. Please
return to
the case for PDF printing options.
- Unreported Judgment
- Slogrove Tobias & Partners Pty Ltd v Janke[2009] QDC 422
- Add to List
Slogrove Tobias & Partners Pty Ltd v Janke[2009] QDC 422
Slogrove Tobias & Partners Pty Ltd v Janke[2009] QDC 422
DISTRICT COURT OF QUEENSLAND
CITATION: | Slogrove Tobias & Partners P/L v Janke & Ors [2009] QDC 422 |
PARTIES: | Slogrove Tobias & Partners Pty Ltd (ACN 116 568 480) (Applicant) And Trevor Peter Janke and Lyn Adamson Janke and John James Forbes (Respondents) |
FILE NO/S: | 120/09 |
DIVISION: | District Court, Civil |
PROCEEDING: | Application |
ORIGINATING COURT: | District Court, Townsville |
DELIVERED ON: | 04 September 2009 |
DELIVERED AT: | Townsville |
HEARING DATE: | 5 August 2009 |
JUDGE: | DURWARD SC, DCJ |
ORDERS: | 1 Application refused in respect of Grounds 1 (a) and 1 (b); 2 Application granted in respect of Ground 1 (c). Paragraphs 3 and 4 of the defence are struck out; 3 The first, second and third defendants to file and serve an amended defence within fourteen (14) days; 4 The plaintiff to file any Reply within seven (7) days of the service of the amended defence; 5 The respondents to pay to the applicant its costs of and incidental to the application on the standard basis. |
CATCHWORDS: | RULES – DEEMED ADMISSIONS – JUDGMENT – whether statement of negative of pleaded allegation with denial sufficient as a direct explanation in circumstances. SUMMARY JUDGMENT – construction of contract – identification of contracting party the issue – whether two- part test satisfied. PRACTICE AND PROCEDURE – STRIKING OUT PLEADING – whether pleading in defence sufficient in light of facts alleged in affidavits responding to application for judgment. UCPR rules 166, 171, 190 and 292. Groves v Australian liquor, Hospitality and Miscellaneous Worker’s Union [2002] QSC 142; Cape York Airlines Pty Ltd v QBE Insurance (Australia) Ltd [2008]QSC 302; Deputy Commissioner of Taxation v Salcedo [2005] 277; Bolton properties Pty Ltd v JK Investments (Australia) Pty Ltd [2009] QCA 135. |
COUNSEL: | Mr G N Humphreys for the applicant Mr G Lynam for the respondents |
SOLICITORS: | Connolly Suthers for the applicant Boulton Cleary & Kern Lawyers for the respondents |
APPLICATION
- [1]The applicants applied for three orders stated to be in the alternative:
- Judgment against the respondents on admissions and deemed admissions contained in the defence of the respondents, pursuant to rules 166 and 190 of the Uniform Civil Procedure Rules 1999 (‘UCPR’);
- An order for summary judgment against the respondents pursuant to rule 292 UCPR; and
- An order pursuant to rule 171 UCPR that paragraphs 3 and 4 of the defence of the respondents be struck out.
THE LITIGABLE ISSUE
- [2]The applicant, trading as STP Consultants, operates a structural and civil planning business. The applicant’s claim against the respondents is for the sum of $81,400 in respect of the provision of professional services to the respondents, who were separately the registered proprietors of three blocks of land in Morehead Street, South Townsville.
- [3]Tax invoices were produced by the applicant. The issue is the identity of the proper party with whom the applicant contracted to provide the professional services and consequently the party liable to pay the applicant’s tax invoices.
- [4]The applicant contends that the respondents are the contracting parties. The respondents contend – in an affidavit but not in pleadings – that the contracting party is a company Zimway Pty Ltd.
DOCUMENTS
- [5]The contract is said to comprise two documents:
- A letter dated 4 July 2008 from STP Consultants and addressed to Select Property Australia, containing a scope of services and fee proposal (by way of offer) for a development on the three blocks of land (the letter); and
- A document titled “confirmation of agreed commission consulting engineering works” intended, it seems, to be completed (by way of acceptance) by the other contracting party (the confirmation).
- [6]The documents were returned to the applicant. The letter was returned with two handwritten corrections: the name of the addressee was altered to “Zimway P/L”; and the name of the person for whose attention the letter was intended, was altered to correct the spelling of the name to “T Janke”. The confirmation had been completed by handwritten notations: “Zimway P/L”, a signature, the name “Trevor Janke”, a company position description of “Director” and the date of “11/07/08”.
- [7]Zimway Pty Limited was de-registered on 07 June 2009. It appears from the company search document that it had in the past been the subject of strike-off action or been under external administration. The first and second respondents had formerly been directors of the company.
- [8]In submissions made to me another company is said to have been relevant, namely Philmania Pty Ltd. The first respondent is a director of that company. It carried on business of providing real estate services under the registered business name of Select Property Australia.
- [9]Five tax invoices were produced by the applicant, the first being sent on 31 July 2008 to Select Property Australia and then on the same date the same invoice being sent to Zimway Pty Ltd, both to the same post office box address. The other four tax invoices were sent at the end of August, September, October and November 2008 to Zimway Pty Ltd. Those tax invoices were progress claims for the provision of the professional services.
- [10]On 16 January 2009 the applicant sent a letter to Zimway Pty Ltd for the attention of the first respondent which attached a credit note for one professional service provided by the applicant which had been inadvertently double invoiced.
- [11]On 24 January 2009 the five tax invoices were enclosed with a letter of that date as “amended tax invoices”, addressed to Zimway Pty Ltd and the three respondents, care of the first respondent at the post office box address previously referred to.
- [12]A creditor statutory demand for payment of debt dated 5 February 2009 was sent by the applicant to Zimway Pty Ltd.
- [13]The applicant relied on the opening words of the confirmation, namely: “…We Zimway P/L being the registered owner or appointed delegate of the registered owner of land described as … do hereby accept the terms and conditions of the fee proposal…” (My underlining)
- [14]It was submitted that the company Zimway Pty Ltd was not a registered owner and therefore could only be a delegate of the registered owners and consequently the contracting parties were the registered owners, that is, the three respondents.
- [15]The respondent referred to a reference in the confirmation about a proposal “…dated 24 June 2008”. There apparently is no proposal of such a date. The proposal was as a matter of fact, the letter dated “4 July 2008”. However, there does not seem to be any real dispute about the documents that constituted the contract.
- [16]The respondents submitted that the contracting party was the company in its own right. They looked to subsequent conduct of the applicant in support of that contention: the applicant’s tax invoices addressed to Zimway Pty Ltd; the letter enclosing a credit note (by way of adjustment to one of the tax invoices) addressed to Zimway Pty Ltd; the creditor’s statutory demand addressed to Zimway Pty Ltd; and the reissued tax invoices addressed to Zimway Pty Ltd and to the respondents.
- [17]On the material there is no issue about the registered proprietors of the three blocks of land. Each of the respondents is the registered proprietor of one of the blocks of land.
- [18]The appellant submitted that the confirmation was not in any way equivocal and that Zimway Pty Ltd executed the document as agent for each of the registered proprietors, namely the three respondents. The respondent submitted that the company itself was the contracting party and that it was the company that was the addressee in all of the relevant correspondence or communications between the parties until recently. The applicant contended that the use of the company name by the respondents was an intentional act for the purpose of avoiding legal responsibility for the payment of the fees due to the applicant. Each of the respondents have sworn affidavits denying that there was any consent by the company to the assignment of the fee proposal to the respondents and that each of them never accepted the fee proposal nor consented to the assignment of the same.
GROUND 1: JUDGMENT ON ADMISSIONS
- [19]In the applicant’s statement of claim the contract is alleged to have been made on or about 11 July 2008 and is said to comprise the letter to Select Property Australia of 4 July 2008. I note that, other than inferentially, the confirmation document is not specifically referred to. However, the issue so far as this ground is concerned focuses upon admissions made to matters not in dispute in this application and specifically to the respondents pleading in their defence with respect to paragraph 2 of the statement of claim. The statement of claim alleges that the applicant and the respondents entered into the subject agreement. In their defence in paragraph 3, the respondents “…deny the allegations in paragraph 2 of the statement of claim because they are not true. The defendants did not enter into any agreement as alleged by the plaintiff or at all.”
- [20]However the respondents’ affidavits filed on this application appear to assert that the contract was not one between the applicant and the respondents but rather was between the applicant and Zimway Pty Ltd and that the contract has not ever been assigned to any of the respondents.
- [21]The applicant submits that there is no dispute that the works performed by the applicant were works performed in respect of real property owned not by Zimway Pty Ltd but by the respondents, nor is there any dispute that the respondents themselves have obtained the benefit of those works. It is submitted there is no suggestion or evidence that Zimway Pty Ltd engages in property development and that the clear inference that the court can properly and objectively draw from the material is that the use of Zimway Pty Ltd is a subterfuge, in effect, intended to relieve the respondents from liability to pay the fees. In so far as this ground is concerned the applicant asserts that a denial of an allegation of fact must be accompanied by a direct explanation for the party’s belief that the allegation is untrue failing which the party is taken to have admitted the allegation pursuant to rule 166 UCPR. It is submitted that firstly the court should exercise its discretion and disregard the information in the affidavits which is not set out in the defence and that the defence in paragraph 3 is an admission upon which the court is able to give judgment pursuant to rule 190 UCPR.
- [22]Rule 166 of the UCPR provides, so far as is relevant, as follows:
“166 (1) An allegation of fact made by a party in a pleading is taken to be admitted by an opposite party required to plead to the pleading unless –
- (a)the allegation is denied or stated to be not admitted by the opposite party in a pleading; or
- (b)Rule 168 applies
……
- (4)A party’s denial or non-admission of an allegation of fact must be accompanied by a direct explanation for the party’s belief that the allegation is untrue or cannot be admitted.
- (5)If a party’s denial or non-admission of an allegation does not comply with sub rule (4) the party is taken to have admitted the allegation.”
- [23]Rule 190 UCPR provides, so far as is relevant as follows:
“190 (1) If an admission is made by a party, whether in a pleading or otherwise after the start of a proceeding, the court may, on the application of another party, make an order to which the party applying is entitled on the admission.
- (2)The court may give judgment or make another order even though other questions in the proceeding have not been decided.”
- [24]The issue of whether a denial which consists of simply stating the negative of the allegations pleaded in the statement of claim without anything more save for an assertion that the allegation is untrue was considered in Groves v Australian Liquor, Hospitality and Miscellaneous Workers’ Union (2002) QSC 142. In that case the denial was simply a statement of the negative of the allegation pleaded in the statement of claim without any further elaboration as to why the defendants believed that the allegation was untrue, other than a statement that the defendants denied the allegations believing them to be untrue at all material times. MacKenzie J (at paragraph 15) stated:
“…I am satisfied that the pleading is not sufficient to comply with UCPR 166(4). A mere statement to the opposite of what is alleged by an opposing party is not a denial ‘accompanied by direct explanation for the party’s belief that the allegation is untrue’ A direct explanation is more than this. there does not need to be a pleading of evidence as that term is understood by the rules of pleading. A statement of fact as to why it is believed that the allegation is untrue does not involve contravention of the rule. If the point of the other aspect of the defendants’ argument is that in some cases the belief might depend on a mixed question of fact and law, a statement of a conclusion expressed as fact is ordinarily treated as a statement of fact. (Thomas v the King (1937) 59 CLR 279 at 306-207).”
- [25]Groves was referred to in Cape York Airlines Pty Ltd v QBE Insurance (Australia) Ltd (2008) QSC 302. Daubney J said (at paragraph 27, 29 and 30):
“A direct explanation for a party’s belief that an allegation is untrue is precisely what it says – a direct explanation for the belief… [The] requirement that a party provide a direct explanation for its belief that an allegation is untrue fulfils two important functions:
- it compels the responding party to expose at an early stage of the proceeding, its rationale for a joinder of issue on a particular allegation;
- it necessarily compels the responding party to formulate that rationale. In other words, the party must ask itself, and be able to answer the question, “Why am I denying this fact?”
…
(29) The direct explanation itself, clearly enough is not a statement of a material fact for the purposes of rule 149. it may be, however, that the nature of the direct explanation of the party’s belief that an allegation is untrue necessarily compels the party to plead, in compliance with rule 149, the material facts, (not evidence) on which it were relied controvert the allegation or other matters to prevent the opponent being taken by surprise…
(30) This approach to rule 166, in my view reflects the scheme of pleadings introduced by the UCPR to achieve early comprehensive disclosure of the cases to be mounted by each party. The requirement for parties who are responding to allegations to turn their minds to making appropriate admissions and articulating their direct explanation in connection with denials and non-admissions is directed to the early and efficient identification of the ‘real issues’ which require ‘just an expeditious resolution…at a minimum of expense’, and thereby observing the inspirational statement of purpose expressed in rule 5.”
- [26]The respondent submitted that the explanation given for the denial is sufficient compliance with the rule, given that all of the relevant documents relied upon by the plaintiff and in particular the documents signed by the first defendant date 11 July 2008, identified Zimway Pty Ltd as the contracting party to the agreement with the plaintiff and not the defendants in their individual capacity.
- [27]It is arguable that a direct explanation might have required the respondents to add to their denial words to the effect that the contracting party was ‘Zimway Pty Ltd’, that being a fact within their knowledge and clearly a relevant matter on the face of the pleadings and the relevant contractural documentation. However, I think there is some merit in what the respondent submits about this issue. The applicant had, until it realised its error, treated the contacting party as Zimway Pty Ltd. It is arguable that the primary contractual document identifies the party with whom the applicant contracted as Zimway Pty Ltd. I do not think that it is sufficiently clear on the documents or the pleadings that the manner in which the defendants have expressed their denial is deficient to the effect that the denial becomes a deemed admission pursuant to the rule. However, it is arguable that now that the issue between the parties has been clearly identified (that is, that it is the company rather than the individuals who is the party that contracted with the applicant) then an amendment to the defence is desirable. However, this is the subject of a further application.
GROUND 2: SUMMARY JUDGMENT
- [28]Rule 292 UCPR provides as follows:
“292 (1) A plaintiff may, at any time after a defendant files a notice of intention to defend, apply to the court under this part for judgment against the defendant.
(2) If the court is satisfied that –
- (a)the defendant has no real prospect of successfully defending all or a part of the plaintiff's claim; and
- (b)there is no need for a trial of the claim or the part of the claim;
the court may give judgment for the plaintiff against the defendant for all or the part of the plaintiff's claim and may make any other order the court considers appropriate.”
- [29]The respondents relied upon the decisions in Deputy Commissioner of Taxation v Salcedo (2005) 227 and Jessup v Lawyers Private Mortgages Pty Ltd (2006) QSC 003 in arguing that the defence asserts a substantive defence, namely that the respondents were not parties to the agreement with the plaintiff. They submitted that the matters in dispute between the parties, now highlighted in this application, are issues that can only be resolved at trial and in those circumstances summary judgment should not be ordered against them.
- [30]The applicant referred to a more recent decision in Bolton Properties Pty Ltd v JK Investments (Australia) Pty Ltd (2009) QCA 135 (a judgment published on 22 May 2009). In Bolton the interpretation of the “no real prospect of success” test in rule 292 UCPR was the subject of analysis. The court’s discretion to grant summary judgment requires satisfaction of both matters referred to in sub rule (2) (a) and (b).
- [31]In the first instance the appropriate inquiry is whether there exists a real, as opposed to a fanciful, prospect of success and in respect of the second, a judgment as to whether there is no need for a trial. In other words, if the respondent can establish some real prospect of succeeding at a trial, then the matter must go to trial. Issues raised in proceedings will only be determined on a summary judgment if it is absolutely clear that there is no real prospect of a successful defence and there is no need for a trial.
- [32]The primary documents in this case are the letter and more particularly the confirmation. It seems to me that the documents together comprise the relevant contract between the contracting parties. They also are the primary documents in respect to the identification of the party that contracted with the applicant.
- [33]The issue so far as the contract is concerned, is the identity of the party purporting to have contracted with the applicant. That is, was it the company or was it the three respondents in their individual capacities. To the extent that the construction of the document is a consideration, the execution of the contract and in what capacity the executioner performed that act is a real issue and undoubtedly the material issue in the litigation.
- [34]The identification of the proper party to a contract is a matter that must be determined upon evidence rather than upon a superficial construction of a contract from what appears to be – but which is in dispute – the legal effect of the words used. The fact that the applicant regarded the company to have been the contracting party throughout all but the most recent of its correspondence and its documentation relating to recovery of its fees would seem to indicate that at all times the applicant may have considered the company to be the proper party. Of course, that observation should not be taken as a finding because it is not: rather, it is simply an observation upon the face of documents and states of mind which have not been expressed in evidence.
- [35]The applicant relied upon discussion of what is referred to as “the objective theory of contract” in Smith v Hughes (1871) LR 6QB 597 and Taylor v Johnson (1983) 151 CLR at 422 . However, in my view when one looks at the matters that the court must be satisfied of pursuant to rule 292 UCPR, it is not possible to say that the respondents have no real prospect of successfully defending all or a part of the plaintiff's claim. That is sufficient to dispose of the application. However, I am also of the view that there is in fact a need for a trial of the claim or a part of the claim.
- [36]In those circumstances the application for summary judgment should be refused.
GROUND 3: STRIKING OUT THE DEFENCE
- [37]The applicant, relying on the same submissions as made in respect of the judgment on admissions in Ground 1, submitted that the defence of the respondents disclosed no defence and that paragraphs 3 and 4 should in accordance with rule 171 be struck out and the respondents ordered to re-plead. The respondents submitted that there was nothing raised by the applicant that would satisfy any of the matters set out in rule 171 to justify a striking out of any part of the defence.
- [38]Rule 171 provides as follows:
“171 (i) This rule applies if a pleading or a part of a pleading –
(a) discloses no reasonable cause of action or defence; or
(b) has a tendency to prejudice or delay the fair trial of the proceeding; or
(c) is unnecessary or scandalous; or
(d) is frivolous or vexatious; or
(e) is otherwise an abuse of the process of the court”
- [39]The defence in paragraphs 3 and 4 offends rule 171(b) and those paragraphs should be struck out and the respondents ordered to re-plead to reflect what has been made perfectly clear from the affidavit material filed by the respondents.
- [40]The issue that is alive between the parties is the identity of the party who contracted with the applicant. Although I have found that the manner in which the defence is drawn does not justify a judgment on deemed admissions, nevertheless as things presently stand there is an inadequacy in the pleading. It ought to be supplied by a pleading that states the positions adopted by the individual respondents in their affidavits filed in this application.
CONCLUSION
- [41]It follows from what I have said that I consider that the respondents are entitled to rely upon their affidavit material and were entitled to have leave to read the material upon the application.
- [42]The application is dismissed in respect of grounds 1(a) and 1(b). I grant the application in respect of ground 1(c).
- [43]In the premises the applicant is entitled to its costs of the application.
ORDERS
- Application refused in respect of grounds 1(a) and 1(b).
- Application granted in respect of ground 1(c). Paragraphs 3 and 4 of the defence are struck out.
- The first, second and third defendants to file and serve an amended defence within fourteen (14) days.
- The plaintiff to file any Reply within seven (7) days of the service of the amended defence.
- The Respondents to pay to the applicant its costs of and incidental to the application on the standard basis.