28 Careel Developments Pty Ltd v S.O.S Plumbing Services (Qld) Pty Ltd
[2016] QDC 223
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- 28 Careel Developments Pty Ltd v S.O.S Plumbing Services (Qld) Pty Ltd[2016] QDC 223
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28 Careel Developments Pty Ltd v S.O.S Plumbing Services (Qld) Pty Ltd[2016] QDC 223
28 Careel Developments Pty Ltd v S.O.S Plumbing Services (Qld) Pty Ltd[2016] QDC 223
DISTRICT COURT OF QUEENSLAND
CITATION: | 28 Careel Developments Pty Ltd & S.O.S Plumbing Services (Qld) Pty Ltd; 28 Careel Developments Pty Ltd & P.E.T Services (Aust.) Pty Ltd [2016] QDC 223 |
PARTIES: | In Appeal No 1340 of 2016: 28 CAREEL DEVELOPMENTS PTY LTD ACN 163 975 059 (appellant) v S.O.S. PLUMBING SERVICES (QLD) PTY LTD ACN 112 074 227 (respondent) In Appeal No 1341 of 2016: 28 CAREEL DEVELOPMENTS PTY LTD ACN 163 975 059 (appellant) v P.E.T. SERVICES (AUST.) PTY LTD ACN 119 878 090 (respondent) |
FILE NO/S: | Appeal No 1340 of 2016 Appeal No 1341 of 2016 |
DIVISION: | Civil |
PROCEEDING: | Appeal |
ORIGINATING COURT: | Magistrates Court at Brisbane |
DELIVERED ON: | 13 September 2016 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 22 August 2016 (with all supplementary submissions filed by 29 August 2016) |
JUDGE: | Dorney QC DCJ |
ORDERS: | The Court orders that:A. For appeal number 1340 of 2016:
B. For appeal number 1341 of 2016:
|
CATCHWORDS: | Setting aside a default judgment – where notice filed outside time – whether leave should be given to extend the time to file the notice of appeal – whether the appeal should be allowed Setting aside a default judgment – where notice filed outside time – where amount claimed is under the minor civil dispute limit – whether leave should be given to extend the time to file the notice of leave to appeal – whether leave should be given to appeal – whether appeal should be allowed |
LEGISLATION CITED: | Magistrates Courts Act 1921 ss 43, 45, 47 Queensland Civil and Administrative Tribunal Act 2009 Subcontractors’ Charges Act 1974, ss 3A, 5 Uniform Civil Procedure Rules 1999 rr 78, 290, 748, 765, 766, 785 |
CASES CITED: | American Express International Inc v Hewitt [1993] 2 Qd R 352 Builders Licensing Board v Sperway Constructions (Syd) Pty Ltd & Anor (1976) 135 CLR 616 Carr v Finance Corporation of Australia Ltd (1981) 147 CLR 246 Colgate-Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225 Di Iorio v Wagener [2016] QCA 97 Emanuel Management Pty Ltd (in liq) v Foster’s Brewing Group Limited [2003] QSC 484 Embrey v Smart [2014] QCA 75 House v The King (1936) 55 CLR 499 National Mutual Life Association of Australasia Ltd v Oasis Developments Pty Ltd (citation omitted) Raedel v Jezer Construction Group Pty Ltd and Ors [2002] QDC 079 Ramzy v Body Corporate for GC3 CTS38396 & Anor [2012] QDC 397 White Industries (Qld) Pty Ltd v Flower & Hart (a firm) (1998) 156 ALR 169 |
COUNSEL: | I Klevansky for the Appellant A M Nelson for the Respondents |
SOLICITORS: | AG Edwards for the Appellant Alexander Law for the Respondents |
Introduction
- [1]These two appeals were heard together. This was done because substantially the same issues arose in both appeals brought by the same applicant/appellant. Although there were different plaintiffs at first instance, they both were represented by the same legal representatives at first instance and on appeal. Although both “appellants” are, until leave is given appropriately, only applicants, I will use the term appellants for ease of expression.
- [2]Although an application in each proceeding was made by both appellants for consolidation of the two “appeals”, that application was refused (for reasons which I discuss next), with the consequence that both hearings were conducted together but the decisions reached separately.
Refusal of consolidation
- [3]The appellants sought that both appeals be consolidated pursuant to r 78 of the Uniform Civil Procedure Rules 1999 (“UCPR”). If that particular rule (which directly deals with proceedings at first instance) were to be applicable to appeals, I would still have ordered pursuant to that rule what is inherent in Part 2 of the UCPR (which is that the “proceedings” be “heard together”), as I have done anyway.
- [4]One of the contended bases for consolidation was that it would remove any issue of “leave to appeal” in Appeal No. 1341/16 “as the proceeding would in its entirety be over the minor civil limit”.
- [5]Although the pleadings in both proceedings at first instance are very similar and although the issues on appeal are substantially the same – except for the question of leave to appeal in the latter – it is simply the case that it is a mere coincidence that the two respondents, both subcontractors involved in separate claims made under the Subcontractors’ Charges Act 1974, used the same legal representatives and, therefore, had the applications at first instance heard together.
- [6]Consequently, while deciding to hear the matters together, I, at the outset (as noted above), refused the application for consolidation.
Issues
- [7]Since the appellant is common in both appeals, since it has been represented by the same legal representatives both at first instance and on appeal, and since the same superior contractor’s contract is involved, it is unsurprising that there are common, or similar, issues that cover the following matters:
- an application for an extension of time (to appeal or for leave to appeal);
- whether the appeal is to be by way of a strict appeal or by way of a rehearing;
- whether, if by way of rehearing, further evidence as to questions of fact by affidavit ought be received; and
- whether the appellant (as an original defendant in each original proceeding):
- had a prima facie defence on the merits;
- had a satisfactory explanation for its failure to appear on the default judgment hearing; and
- had delayed in bringing the application to set aside the default judgment.
- [8]There are some sub-issues which fall within those common issues as well. The process that I intend to follow is to discuss each of the common issues initially and then, for Appeal No. 1341/16, to discuss the issue of leave to appeal separately.
Extension of time
- [9]Rule 748(a) of the UCPR – made applicable to these appeals by r 785 – states that a notice of appeal must, unless the District Court otherwise orders, be filed within 28 days after the date of the decision appealed from.
- [10]It is common ground between the parties on appeal that each document entitled “NOTICE OF APPEAL SUBJECT TO LEAVE” was filed on 11 April 2016. Despite the infelicity of the heading of that document in each case, it is common ground that each should be treated, respectively, as an application for leave to have the time allowed to appeal extended (for Appeal No 1340/16) and for leave to appeal conditional upon the court extending time (for Appeal No 1341/16): see the remarks by Chesterman J (as he then was) in Emanuel Management Pty Ltd (in liq) v Foster’s Brewing Group Limited [2003] QSC 484 at [8].
- [11]An affidavit by Mr Du Plessis filed in each proceeding in this Court on 11 April 2016 (as solicitor for each appellant) deposed to the fact that, although the learned Acting Magistrate published each decision and her reasons on 8 March 2016, his firm was not notified of that decision being handed down and that he only became aware of the decision on 15 March 2016 on receiving respective emails from the relevant Registrar. That email apologised for the delay. Mr Du Plessis then asserted that the appellant on each proceeding required 28 days from the date of awareness to get instructions to be able to file the relevant originating documentation for that appeal. At the hearing of the appeals, no issue was taken in any express way to the truth of the content of what Mr Du Plessis had to say.
- [12]Since it is clear that the originating documents for the appeals were not filed within the 28 days after the date of the decision appealed from, it is necessary for this Court to consider whether the principles governing the extension of time applied (to the appellant’s advantage in each proceeding). Such principles are set out in Di Iorio v Wagener [2016] QCA 97 at [28].
- [13]For appellate purposes, there has been good reason shown and there has been no lengthy or unjustifiable delay (insofar as unjustifiable has relevance to the taking of relevant instructions and initiating the filing of each relevant originating application). Besides the absence of any lengthy or unjustifiable delay, there is no additional disqualifying feature such as timely informal notice being given of the handing down of the decision or prejudice to each respondent or the potential for unsettling other people or established practices. As for the merits of the appeal and general considerations of the interests of justice, although I will deal with these in some more detail when viewing the bases for the exercise of a discretion concerning the setting aside of both judgments by default, it is sufficient for the present purpose to say that those features would not be disqualifying aspects here.
- [14]Accordingly, in both “appeals” I will grant an extension of time to permit both “appeals” to be considered by this Court.
Strict appeal or rehearing?
- [15]As set out in the judgment of Mason J in Builders Licensing Board v Sperway Constructions (Syd) Pty Ltd & Anor (1976) 135 CLR 616, upon “an appeal stricto sensu the question considered is whether the judgment complained of was right when given…, that is whether the order appealed from was right on the material which the lower court had before it”: at 619. Later in that judgment he contrasted that with an appeal by way of rehearing, noting that the features of it were that the Court would have power to take fresh evidence and draw inferences of fact: also at 619.
- [16]In Carr v Finance Corporation of Australia Ltd (1981) 147 CLR 246 it was held that an order by a court of a State refusing to set aside a judgment obtained upon the default of the defendant in delivering a defence does not finally dispose of the rights of the parties and, hence, such an order is not a final order.
- [17]In these two cases each appeal is against an order refusing each appellant, as the relevant defendant at the first instance, leave to apply to set aside the judgment entered by default (by each plaintiff at first instance).
- [18]Rule 765 of the UCPR – applicable by r 785 – states, by r 765(2), that an appeal from a decision other than a final decision in a proceeding “is brought by way of an appeal” (that is, a strict appeal). But r 765(4) states that, despite subrule (2) but subject to the Act authorising the appeal, the court may hear an appeal from a decision mentioned in r 765(2) if the court is satisfied “it is in the interests of justice to proceed by way of rehearing”.
- [19]As for the Act authorising the appeal, while s 43(1) of the Magistrates Courts Act 1921 (“MCA”) states that all judgments and orders made by a Magistrates Court “shall be final and conclusive”, it states that that is subject to that Act. Then s 45(1), again being subject to the Act, states that any party who is dissatisfied with the judgment or order of a Magistrates Court in an action which the amount involved is more than the minor civil dispute limit may appeal to the District Court as prescribed by the rules: see s 45(1)(a). It is also necessary to advert to s 45(2)(a) which states that, where in any of the cases referred to in s 45(1) the amount is not more than the minor civil dispute limit, an appeal shall lie by leave of the District Court “who shall not grant such leave to appeal unless the Court… is satisfied that some important principle of law or justice is involved”.
- [20]Finally, for present purposes it is noted that s 47 of the MCA states that, on a hearing of an appeal, the District Court may, among other things, draw inferences of fact from facts found by the Magistrates Court, or from admitted facts or facts not disputed: see s 47(a). As well, s 47(d) empowers the District Court to make any other order, on such terms as it thinks proper, to ensure the determination on the merits of the real questions in controversy between the parties.
- [21]Despite the apparent restriction following upon r 765(2), r 766(1)(b) – seemingly indiscriminately – states that the Court may draw inferences of fact and may, on special grounds, receive further evidence as to questions of fact by affidavit: see subparagraphs (b) and (c) of r 766(1).
- [22]Given the terms of s 47 of the MCA and given the perceived need here (illustrated by a further affidavit filed on behalf of each appellant on 16 May 2016 concerning further evidence), I conclude that it is in the interests of justice to proceed by way of a rehearing.
Effects of determining these as a rehearing
- [23]Somewhat intriguingly for a strict appeal, r 766(2) states that, for r 766(1)(c) – dealing with the receipt of further evidence as to questions of fact – further evidence may be given “without special leave” if the appeal is not from a final judgment. But this is now being considered as a rehearing. Hence, the further affidavit sought to be relied upon which was filed 16 May 2016 needs to be considered on the basis, not of special leave, but simply of leave. Accordingly, it is unnecessary to canvass those special leave authorities that deal with whether the particular evidence in question was available at the original hearing, although it would be still a matter to be considered in exercising the relevant discretion.
- [24]In considering the issue of discretion, it is clear from the submissions that were made at the original hearing by each plaintiff (now respondent) that criticism was directed to the lack of a draft defence in each proceeding. The affidavit of Ms Mary Li, a director of the appellant company in each appeal, attempts to redress that criticism. In circumstances where it is important to determine whether there is a prima facie defence on the merits, I conclude that the discretion should be exercised to permit the appellant in each appeal to refer to that affidavit.
Principles concerning setting aside default judgments
- [25]As summarised by Applegarth J on behalf of the Court of Appeal in Embrey v Smart [2014] QCA 75, the relevant principles (applicable for a regularly entered default judgment) in a determination pursuant to r 290 of the UCPR are those summarised by McPherson J (as he then was) in National Mutual Life Association of Australasia Ltd v Oasis Developments Pty Ltd (citation omitted), being whether the applicant for relief has:
- given a satisfactory explanation for a failure to appear;
- delayed in bringing the application; and
- disclosed a prima facie defence on the merits:
at [42].
With respect to a satisfactory explanation, Applegarth J with respect to the case in question noted that the primary judge there concluded that, after considering relevant evidence, while it was easy to assert that court documents were not received, it was “quite another thing for the defendant to provide a satisfactory explanation for the failure to appear”: at [43]. In further reference to that, Applegarth J held that the relevant person did not explain how it was that documents did not come to his attention prior to the time when the relevant premises were vacated (where it might be expected that he would continue to receive post or service) or why there was a failure to provide a forwarding address or other means for documents to be brought to the person’s attention: at [56]. As a result, Applegarth J held that a satisfactory explanation was not provided for the failure to appear because the person had not established an essential matter. It should also be noted that Applegarth J, in reference to r 290, remarked that it does not require an applicant to establish each of the three matters referred to above but that they are all matters that “assume importance”, further observing that the issue of whether there is a prima facie case on the merits disclosed “is the most cogent” of those three matters: at [67]. Expanding on that, Applegarth J noted, by reference to cited authority, that an applicant must produce to the court evidence that there is a prima facie defence and that there must be more than a bare allegation (such that the allegation must be supported by “some reference to evidence to suggest that the defence is plausible and not just raised for the purpose of having default judgment set aside”): at [68]. Finally, he noted that while the requirement referred to evidence and not generalities, it did not necessarily require a lengthy affidavit of merits: at [69].
Error?
- [26]As is acknowledged in Embrey, the decision to be made at first instance is a discretionary decision: at [72].
- [27]According to the relevant principles enunciated by the High Court in House v The King (1936) 55 CLR 499 (at 504-505), if the decision is made contrary to principle then the determination should be reviewed and the appellate court “may exercise its own discretion in substitution… if it has the materials for doing so”. It is to be noted that if, after a separate and independent exercise, the conclusion reached is no different from that at first instance, then the original decision would stand.
- [28]Here, the learned Acting Magistrate, in identical reasoning in both decisions, while on the one hand referring to the relevant principles directly (as she did at [13] and in the second sentence of [33]), made contrary references in two other places. The first was at [26] where she stated that the issue of the appellant holding any “money payable” to the second defendant under its contract for the purposes of s 5(1)(a) of the Subcontractors’ Charges Act “is a question of fact to be proved as a probability on credible and admissible evidence in the event a trial is warranted” (emphasis added). The second was in the first sentence of [33] where she stated that she was “not convinced that the (appellant) has a genuine defence with realistic prospects of success at a full hearing” (emphasis added). Even if the first statement were to be explained away as an isolated remark, its presence as an adjunct to the second statement triggers a relevant error.
- [29]In consequence, I conclude that the relevant discretion has miscarried and that this Court should exercise the discretion afresh.
- [30]In determining the fresh exercise of the discretion, it is noted that the learned Acting Magistrate made no express findings of otherwise disputed fact (at least in the sense of observing witnesses and making findings on credibility concerning the same). Thus, pursuant either to r 766(1)(b) of the UCPR or to s 47(a) of the MCA, this Court will itself draw relevant inferences of fact from the materials before the Court at first instance.
Satisfactory explanation and delay?
- [31]To the extent that it is relevant at all, the learned Acting Magistrate concluded that each appellant’s explanation for its failure to appear to defend the proceeding was “weak and unsatisfactory”: at [34].
- [32]In my own appreciation, I also conclude that it was weak. The basis advanced by the appellant in each appeal is that the second defendant [with which the corporate first defendant had entered into a Residential Building Contract dated 15 August 2014 (“Contract”)] by its sole director had acted as the appellant’s “project manager and builder” such that “all correspondence was received and held by (the company of which this person, a Mr Maindonald) was the relevant director”. In particular, it was stated that at the time that the relevant Notices of Charge under the Subcontractors’ Charges Act were dispatched by each respondent, the second defendant company was still so acting and, therefore, those notices “never came to the attention” of the appellant. According to the relevant affidavit by Ms Li at the first instance hearing, the appellant only became aware of the fact that there was a judgment entered against it on 7 November 2015 “when a financier notified it that a creditor’s check showed the same and alerted the (appellant) to that fact”. It should also be noted that the judgment entered by default was on 5 February 2015. It was on 19 February 2016 that the appellant brought an application in each proceeding at first instance to set aside such default judgments. Although there is no detailed explanation at all of the delay between 7 November 2015 when the appellant’s solicitor, after a search of the Magistrates Court file, confirmed the entry of the default judgment and the time that each application was filed to set it aside, I do not consider that that later time is unacceptable delay in itself in bringing the applications at first instance. It is noted that the one detail revealed in the affidavit of Ms Li was that a month after such awareness, the appellant’s solicitor addressed a letter to the solicitors for each respondent asking, amongst other things, whether they had instructions to accept service, with such solicitor responding via email on 15 January 2016.
Prima facie defence?
- [33]The questions concerning the disclosure, or not, of a prima facie defence are exactly the same in both appeals.
- [34]There was no dispute here whether the relevant Notices were served in an appropriate way pursuant to the terms of the Subcontractors’ Charges Act. What is in dispute is whether no charge could arise because of the lack of any obligation existing at the time of the service of each Notice at the registered address of the appellant.
- [35]Because no party on appeal was able to inform the Court of any authority with respect to the necessity for an exact correlation between the obligation under the superior contract and the work performed which was the subject of each alleged charge by each respondent, I gave leave to file supplementary submissions.
- [36]Those submissions have identified an authority specifically on point. In Raedel v Jezer Construction Group Pty Ltd and Ors [2002] QDC 079 McGill SC DCJ held that, under s 5(1) of the Act, the charge created by such a notice “is not expressly limited to payments due in respect of work which was the subject of a subcontract under which the subcontractor claims”, on the basis that “there is no reason why the scope of this section should be read down that way”: at [6]. I agree that “the scope of the charge is not so confined”. The relevant obligation arising under s 5(1) of the Subcontractors’ Charges Act arises from “money payable to the … superior contractor under the…. superior contractor’s contract”. That is, provided there is such money payable then a subcontractor is entitled to a charge on that money. I agree with Raedel that there is nothing in the structure of that particular section, taken in the context of the whole Act, that restricts such money payable to that part of the superior contract with the superior contractor that covers exactly the work undertaken by the subcontractor which is directly relevant to the charge sought. This is particularly so where the definition of “money payable” is defined by s 3A to mean “all amounts that, under the contract…, are to be credited or allowed in complete or partial satisfaction of the contract price”. It was also in the context that s 5(2) seeks to limit the charge to the “amounts payable” for the specific work done under the subcontract with the superior contractor.
- [37]Thus, for the appellant in each appeal to satisfy the requirement to disclose a prima facie defence on the merits it would have to establish that there is evidence to suggest a plausible defence that no money was obliged to be paid by the appellant to the second defendant in each proceeding as at the date when the charge would have attached (that is, at or about 29 October 2014 - in circumstances where it has not been argued that that is not the relevant date).
- [38]The evidence provided at the hearing before the Acting Magistrate was provided by Ms Li in her “first” affidavit. She asserted that, even though the appellant was never provided with any subcontractor’s invoices by the second defendant relating to the works performed pursuant to the Contract, the appellant, at the relevant time, “held no money which it could have retained for” each respondent. That conclusion purported to rely upon a Progress Claims Schedule asserted to have been agreed between Mr Maindonald, on behalf of the second defendant, and Ms Li on behalf of the appellant, at a meeting on 24 September 2014. Whilst it does not appear that any improper conduct was engaged in by Ms Li, there is strong evidence from which it can be inferred that Mr Maindonald made other statements which were at least false (for example, the statutory declaration he executed on 22 October 2014 asserting that all subcontractors had been paid as at 22 October 2014 is obviously false when it is clear from the proof of debts lodged with the administrator of the second defendant that that could not possibly have been true).
- [39]Even if one were to accept that the Progress Claims Schedule accurately reflected the fact that $1,100,000.00 had been paid, whether directly or indirectly, from the appellant to the second defendant as at 24 September 2014, the Tax Invoices (upon which that Schedule is based) are concerning by the very terms in which they have been made. Not only do some of those Tax Invoices (referred to in that Schedule) pre-date the basis for them (being the Contract dated 15 August 2014) but also the Schedule does not take into account the further Tax Invoice dated 17 October 2014 (with an alleged balance due of $231,790.42). The combination of these two matters suggests not only some doubt about the validity of those earlier Tax Invoices, particularly where they do not chronologically follow the progress of the contextually specified claims (it also being noted that Tax Invoice No 1035, being for the “balance” of the deposit, was dated the same day as the Contract was dated) but also – in a contrary sense – the likelihood that if they were valid then there was a substantial sum outstanding under the Contract.
- [40]On the face of that last analysis, there would then have been owing at least the sum of $230,000.00 as at 29 October 2014.
- [41]It is with respect with that “outstanding” sum that the “second” affidavit of Ms Li filed 16 May 2016 seems to be potentially directed. What that affidavit asserts is that it exhibits a “true copy” of the defence to be filed if the appeal is successful, together with a statement that Ms Li had provided instructions to her solicitors to prepare that document and that, to the best of her knowledge and belief, “the contents” of it are “true and correct”.
- [42]That draft defence alleges, in paragraph 4(b)(ii), that from May 2013 to December 2013 each of 19 investors purchased “shares” in the appellant for an amount of $150,000.00 and each incurred a further $191,578.95 debt (as owing to, presumably, the appellant). It also asserted that, as at mid-July 2014 when those 19 investors “took over the bank account” of the appellant from the control of Mr Maindonald, it had $2,823.28 only in that account – despite the share capital raised (apparently being $2,850,000.00). Additionally, given that small amount then, this (even without documents) calls for an explanation of how the Tax Invoices “due” later were able to be paid. If it was from the $1,369,851.00 “deducted” earlier (and mentioned next), it again calls for some better accounting (with documentation), particularly where there are valid concerns of a lack of diligent control of funds by Mr Maindonald. As foreshadowed, in para 6(c)(iii), it is alleged that “prior” to July 2014 the second defendant (through Mr Maindonald) had “deducted from” the appellant $1,369,851.00 (comprising $964,851.00 from the appellant’s “bank account” and $405,000.00 from the “deposits” made by the 19 investors). If, as at July 2014, the bank account balance was so small and if the Tax Invoice dated 17 October 2014 correctly claimed a (then) “balance due” of greater than $230,000.00, the “new” sum of $1,369,851.00 is disqualified from being used to cover that as some kind of earlier pre-payment, leaving no amount outstanding on which the charges could be claimed. Despite the knowledge that the appellant, through Ms Li, had of Mr Maindonald’s doubtful character, there was no “evidence” produced to support the origin or destination of these monies. The confusion arising from the absence of hard evidence is multiplied by the apparent use of the term “deposits” when the sums appear to refer to share capital.
- [43]Although paragraph 6(c)(v) states that, by reason of that payment referred to earlier of $1,100,000.00, the appellant had “paid” the second defendant “for all earthworks” as at 24 September 2014, such “payment” is, as I have determined earlier, insufficient to discharge any other obligation that the appellant had to the second defendant which might have been subjected to a relevant charge. The higher sum (first asserted on appeal) was also proffered as supporting the claim that all “earthworks” sums owing had been discharged prior to the charge operating. Therefore, the evidence advanced by the appellants does not address the real question of what was owing under the “superior” contract as at the date the charge was triggered (beyond the “earthworks”).
- [44]A criticism which has been made of the material proffered by the appellant, both at first instance and on appeal, is that the appellant has never produced to any court any financial statements (including bank statements) which might show the movement of any money or credit from the appellant to the second defendant, much less any company document dealing with the actual day-to-day obligations under the “superior” contract.
- [45]As canvassed earlier, the evidence required here must be such as to suggest that the defence is plausible and not just raised for the purpose of having default judgment set aside. On the other hand, a defendant who has an apparently good ground of defence is rarely refused the opportunity of defending: see Embrey at [74].
- [46]It does seem highly unusual, where the Court at first instance has criticised the lack of financial documentation, that no documentation was forthcoming in the further evidence disclosed in the second affidavit of Ms Li. Although she deposed to the fact that Chinese was her first language and English was her second language, it is clear beyond argument that the reasons provided by the learned Acting Magistrate referred specifically, and could be easily understood by the appellant’s legal representatives to refer, to the obvious lack of such material.
- [47]Additionally, it is important that the basis of the draft defence was the assumption that the appellant only had to show that the monies expended by it in discharging its obligations under the Contract to the second defendant were with respect to “works” that, in turn, each respondent had made a claim for. This is an argument that I have rejected and it is not satisfactorily answered by any fact or inference derived from both affidavits of Ms Li. It must also be reiterated that it is impossible to accept that the above referred to Statutory Declaration made by Mr Maindonald on 22 October 2014 is in any way credible (even if limited to the payment of the two relevant subcontractors who are respondents in these appeals).
Resolution
- [48]In circumstances where the relevant Notices of Claim of Charge have not been disputed as having been served at the registered office of the appellant and where the Claim and Statement of Claim in each case were also served on the same registered office (on 28 November 2014), particularly where the circumstances which led to the Contract having to be “terminated” (on the basis of an alleged abandonment by the second defendant, by letter of 28 November 2014) were known to the appellant as at that date (see paragraph 14 of Ms Li’s first affidavit) and where an administrator was then likely to be appointed to the second defendant (and, then, was on 5 December 2014), it is apparent that, from before that time, if not as far back as mid-July 2014 (when the appellant regained control of its own bank account), the appellant should have been aware of the necessity to make proper arrangements by taking practical steps to ensure that all documents that were sent to, or served upon, the appellant at its own registered address would be brought to its attention.
- [49]Although disclosure of a prima facie defence is the most cogent matter to be considered, there has also been a significant failure to provide a “satisfactory” explanation for the failure to appear thereby causing the application pursuant to r 290 of the UCPR to be so delayed.
- [50]When that is taken with the very unsatisfactory nature of the material going to the “necessary” absence of any obligation by the appellant to the second defendant under the Contract at the time of the service of the relevant Notices, it leads to the conclusion that the relevant combination of factors causes the appellant, in each case, to have not discharged the onus on it to have the relevant judgments set aside pursuant to r 290 of the UCPR.
Leave to appeal by P.E.T. Plumbing Services (Qld) Pty Ltd
- [51]It is common ground that the definition of “minor civil dispute limit” in s 45(5) of the MCA is $25,000.00, being the prescribed amount under the Queensland Civil and Administrative Tribunal Act 2009.
- [52]Since the judgment that this plaintiff/respondent obtained was an amount which is not more than that limit, leave to appeal is necessary pursuant to s 45(2)(a).
- [53]As Ramzy v Body Corporate for GC3 CTS38396 & Anor [2012] QDC 397 [relying upon American Express International Inc v Hewitt [1993] 2 Qd R 352 (among other decisions)] establishes, it is insufficient that the justice does not go beyond the consequences of the decision upon the immediate party to the proceeding.
- [54]In this case, it is not sufficient to say that there was an important principle of law or justice simply because two different legal entities were both subcontractors with contracts with the same superior contractor in a case involving the Subcontractor’s Charges Act 1974. The reason that both proceedings were heard together and the consequential reason that both appeals were heard together is that the plaintiffs engaged the same legal representatives for proceedings which led to each first instance judgment by default and the subsequent application to set it aside. It involves nothing further. To permit that to be sufficient ignores the underlying basis of the principle which is to limit appeals in minor matters to those which raise such important principles of law or justice. There is nothing in this case that satisfies that test.
- [55]Hence, even if I were to have decided that the appeal concerning S.O.S. Plumbing Services (Qld) Pty Ltd (Appeal No 1340/16) should succeed on the basis that the relevant discretion ought to be exercised in its favour, I would not have granted the leave to appeal with respect to P.E.T. Services (Aust.) Pty Ltd (Appeal No 1341/16).
Summary
- [56]Accordingly in Appeal no. 1340/16 I will make the following orders:
- (a)granting leave to the applicant/appellant to extend the time to appeal;
- (b)dismissing the appeal.
- [57]With respect to Appeal no. 1341/16, I will make the following orders:
- (a)granting leave to extend the time to file the application for leave to appeal;
- (b)refusing the leave to appeal;
- (c)dismissing the application for leave to appeal.
Costs
- [58]There is really no argument, in consequence of the decision made to dismiss both appeals, but that each respondent in each appeal should obtain an order for costs.
- [59]Each respondent has, in turn, sought indemnity costs. Despite the propositions examined in Colgate-Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225 and, with respect to a person’s solicitors, in White Industries (Qld) Pty Ltd v Flower & Hart (a firm) (1998) 156 ALR 169, I have found nothing in the material which would suggest that: there has been the making of false, or irrelevant, allegations of fraud; there was evidence of misconduct, or of the commencement or continuation of proceedings for some ulterior motive; there was an undue prolongation of a case by groundless contentions; (or) there were substantially no prospects of success (despite the fact that the evidence led, in totality, did not manage to satisfy the prima facie requirement it needed to).
- [60]Accordingly, I do not intend to award other than the standard costs.
- [61]Even so, I will give all parties until 4pm on 20 September 2016 to file and serve any (limited to 2 pages) further submissions on costs.