2020-05-01 Alcock v KEM Projects Pty Ltd & Anor [2020] …
MAGISTRATES COURT OF THE AUSTRALIAN CAPITAL TERRITORY
|Case Title: |Alcock v KEM Projects Pty Ltd & Anor |
|Citation: |[2020] ACTMC 9 |
|Hearing Dates: |27 – 28 February 2017, 26 – 27 March 2018, 20 – 21 September 2018, 7 March 2019 |
|Decision Date: |1 May 2020 |
|Before: |Magistrate Morrison |
|Decision: |See paragraph [201] |
|Catchwords: |LIMITATION OF ACTIONS – contracts, torts and personal actions – application of s 11 of the |
| |Limitation Act 1985 (ACT) (“Limitation Act”) – application for extension of time under s 40 of |
| |the Limitation Act where cause of action relates to latent damage to property or economic loss |
| |in relation to such damage – where alternative causes of action brought in contract and |
| |negligence – where plaintiff is not the owner of the property – claim in negligence is in time –|
| |where claim in contract meets the definition of economic loss in relation to latent damage – |
| |consideration of exercise of discretion in relation to contract claim – length of time between |
| |damage and when damage might reasonably have been discovered by the plaintiff – actual prejudice|
| |to defendants – relevance of availability of alternative cause of action to question of |
| |prejudice – application for extension of time refused |
| |CIVIL LAW – NEGLIGENCE – where plaintiff pleaded claim as breach of a duty of care – where |
| |closing submissions rely on claim for contribution under s 21 of the Civil Law (Wrongs) Act 2002|
| |(ACT) – plaintiff not required to specifically plead a claim for contribution – where plaintiff |
| |did not plead elements giving rise to a claim for contribution – plaintiff not permitted to |
| |raise claim for contribution in closing submissions – where plaintiff did not respond to |
| |deficiencies in evidence in establishing breach of duty of care – claim in negligence dismissed |
| |CIVIL LAW – BUILDING, ENGINEERING AND RELATED CONTRACTS – existence of contract for building |
| |work – whether it was a term of the contract that the plaintiff would be remunerated for |
| |“applying his building licence to” a project – whether it was a term of the contract that the |
| |plaintiff would perform and be remunerated for supervision work – assessment of evidence – no |
| |express agreement that the plaintiff would be remunerated – where quantum meruit claim not |
| |pursued – claim dismissed |
| |CIVIL LAW – BUILDING, ENGINEERING AND RELATED CONTRACTS – existence of contract for provision of|
| |expert and rectification services – whether there was an agreement as to the rate of |
| |remuneration – extent of work performed – assessment of evidence – finding that there was |
| |agreement as to rate of remuneration – in the alternative, implication of term to pay a |
| |reasonable rate – assessment of damages and interest |
|Legislation Cited: |Civil Law (Wrongs) Act 2002 (ACT) s 21 |
| |Civil Liability Act 2002 (NSW) |
| |Limitation Act 1985 (ACT) ss 11, 40 |
| |Trade Practices Act 1974 (Cth) s 54 |
|Cases Cited: |Alucraft Pty Ltd (in liq) v Grocon Ltd [1996] 2 VR 386 |
| |Andresakis & Skouteris trading as Andresakis & Associates v Alexus Holdings Pty Ltd [2006] NSWCA|
| |294; 68 NSWLR 507 |
| |BJ Aviation Ltd v Pool Aviation Ltd [2002] EWCA Civ 163; 2 P & CR 25 |
| |Brisbane South Regional Health Authority v Taylor [1996] HCA 25; 186 CLR 541 |
| |Carlisle v Filaria Pty Ltd [2002] ACTSC 33 |
| |Chambers v Northern Coast Area Health Service [2005] NSWSC 833 |
| |Hawkins v Clayton [1988] HCA 15; 164 CLR 539 |
| |Owners – Units Plan No 1917 v Koundouris [2016] ACTSC 96; 307 FLR 372 |
| |Ucak v Avante Developments [2007] NSWSC 367 |
| |Wardley Australia Limited v Western Australia [1992] HCA 55; 175 CLR 514 |
|Texts Cited: |J W Carter, Contract Law in Australia (LexisNexis Butterworths, 7th ed, 2018) |
|Parties: |Robert Alan Alcock trading as Imaginative Concreting & Construction (Plaintiff) |
| |KEM Projects Pty Ltd trading as ReACT Roofing (First Defendant) |
| |Paul Chesterfield (Second Defendant) |
|Representation: |Counsel |
| |K Petch (Plaintiff) |
| |G Blank (Defendants) |
| |Solicitors |
| |McInnes Wilson Lawyers (Plaintiff) |
| |Mills Oakley (Defendants) |
|File Number: |CS 25 of 2015 |
| | |
MAGISTRATE MORRISON:
Introduction
This litigation has had an unfortunate history. The first day of the hearing took place before me on 27 February 2017. Although the plaintiff had been represented at the preliminary and interim stages of the proceedings, by the time of the hearing he was unrepresented. After two days of hearing, I invited the plaintiff to apply for an adjournment to seek legal advice. I did so on the basis that he did not appear to appreciate the significance to his claimed causes of action of the difference in corporate identity between the first defendant and another company which is not a party to these proceedings.
The hearing resumed on 26 March 2018, at which point the plaintiff was represented. Two days had been set aside at that time, but that was not enough time to complete the evidence. Another two days were set aside on 20 and 21 September 2018. Again, that proved an insufficient amount of time in which to complete the evidence, and the final day of the hearing took place on 7 March 2019.
Directions were made for written submissions to be delivered, with the final submissions to be filed by 5 July 2019. I called for some additional short submissions on a discrete point, which were filed on 4 and 28 November 2019.
The subject matter of the dispute between the parties relates to three building projects in the suburbs of Macquarie, Lyneham, and Giralang in the Australian Capital Territory – referred to respectively in these reasons as the Macquarie, Lyneham, and Giralang Projects.
The plaintiff is a builder by trade, and the second defendant a roofer. The first defendant, KEM Projects Pty Ltd (“KEM”), trades under the business name “ReACT Roofing”. It is a company that specialises in the roofing business, and of which the second defendant was, for a time, an employee.
The plaintiff’s case is that a contract was entered into between him and the first defendant in relation to the Macquarie Project and the Lyneham Project, and between him and the second defendant in relation to the Giralang Project. The substance of those contracts related to work to be done in respect of the properties.
In each case, the plaintiff says that the respective defendant has breached the terms of the relevant contract. In the case of the Macquarie Project, the plaintiff pleaded in the alternative that the defendant breached a duty of care owed to him.
The defendants raise several matters by way of defence. They are not the same in each case and determination of the dispute has called for analysis of different issues for each project.
In relation to the Macquarie Project, the determination of the plaintiff’s claim also requires a determination on the question of the application of the Limitations Act 1985 (ACT) and a request under s 40 of that Act for an extension of time. The issues for this project are further complicated by the plaintiff’s final submission after the close of evidence that his alternate claim be treated as one for contribution under the Civil Law (Wrongs) Act 2002 (ACT), rather than a claim in negligence.
Observations about credibility and assessment of evidence
An assessment of the evidence in all areas of the dispute between the parties has been made more difficult in this case by several related factors.
First, for a dispute about building-related contracts, there has been surprisingly little documentary evidence going to the existence or terms of any contract. The defendants say that many of their relevant records have been destroyed and they have been unable to source information from other places. The plaintiff has not put into evidence any document purporting to record contract terms. Each party relied heavily upon their recollections of events, arrangements, and conversations which had taken place years before they gave their evidence without any contemporaneous note having been taken. The risk of a witness’ memory having eroded over time is an obvious one and calls into question the reliability of much of the oral testimony.
Second, despite the time which had passed, both Mr Alcock and Mr Chesterfield at times purported to have precise and firm recollections of events, arrangements, and conversations about which they gave evidence, despite the absence of any apparent aide memoire. In some respects, the certainty with which each says they recall relevant exchanges is of itself a cause of concern about the reliability of their evidence.
Third, evidence was also received about the nature of the relationship between Mr Alcock and Mr Chesterfield. It is apparent that it started as a business relationship. It is equally apparent that it developed into a more personal relationship and that they were on friendly terms, at least before the current disputes developed. The nature of the relationship is relevant in relation to all areas of dispute between the parties and perhaps most so in connection with the Lyneham Project, where the defendants say that the personal nature of the relationship explains what the defendants contend; that is, that Mr Alcock agreed to do what was asked of him without charge.
On the issue of the extent of the personal relationship, I was left with the impression that each of Mr Alcock and Mr Chesterfield was to some extent tailoring their evidence; Mr Alcock tending to downplay the personal nature of the relationship and Mr Chesterfield tending to overstate it. In the result, neither Mr Alcock nor Mr Chesterfield impressed me as an entirely truthful witness. Each tended to engage in self-serving criticism of the other. My conclusion about the relationship is that it was a personal one – that is, it was more than a purely business relationship – and that Mr Alcock and Mr Chesterfield were on friendly terms.
The Macquarie Project
Background
The plaintiff’s claim in relation to the Macquarie Project is that the first defendant breached the terms of a contract entered into with the plaintiff, or, in the alternative, that the first defendant is liable to the plaintiff in tort. As pressed in final submissions the alternate claim is not that the defendant breached a duty to the plaintiff but rather as a breach of duty to the owners and a claim for contribution under s 21 of the Civil Law (Wrongs) Act 2002 (ACT) (“Wrongs Act”).
The Macquarie Project consisted of an extension to a residential property, owned at the time by the plaintiff’s sister and his brother-in-law. The plaintiff was undertaking the extension project and required roofing work to be done. He was referred to the second defendant by a colleague. The terms of the agreement to complete this work – as well as what entity was a party to it – are in dispute. The plaintiff pleads his case against the first defendant. In response, the defendants argue that the agreement was between the plaintiff and a third entity, ReAct Guttering & Fascia Pty Ltd, of which the second defendant was the director. What is not in dispute is that an agreement for the work was struck in 2005 and the work was performed in that year.
On the plaintiff’s case, complaints about the roof leaking were made to him by the original homeowners on several occasions between 2006 and 2009. He said that he in turn raised the complaints with Mr Chesterfield, the second defendant. He said that on each occasion Mr Chesterfield declined to inspect the property and responded by telling him that “it’s a vegetation problem”, meaning that the gutters were blocked by an accumulation of leaves from overhanging trees. The plaintiff said that he accepted that analysis by Mr Chesterfield, and that he did in fact find some accumulation of leaves on the roof when he looked at it on one occasion.
The plaintiff said that he was contacted by the new owners of the house about the roof leaking in 2011. He encouraged them to make a complaint to the ACT Planning and Land Authority (ACTPLA). The new owners did so, and ACTPLA investigated their complaint. This led to the plaintiff being ordered by ACTPLA on 7 March 2012 to undertake remediation work to the roofing and guttering. The plaintiff says that it was only when he was ordered to remediate the work that “he realised that the gutters were non-compliant with the BCA [the Building Code of Australia] and that there was no flashing installed on the roof”.[1]
The limitation questions
The plaintiff’s claim, at least as pleaded, is based in contract, or, in the alternative, in negligence. The first issue that arises for consideration, however, is whether the plaintiff’s claim is statute barred by the Limitation Act 1985 (ACT) (“Limitation Act”).
Section 11 of the Limitation Act applies to the plaintiff’s cause of action. Section 11 provides that “an action on any cause of action is not maintainable if brought after the end of a limitation period of 6 years running from the date when the cause of action first accrues to the plaintiff or to a person through whom he or she claims”.
It is not in dispute that “whilst in contract the cause of action expires six years after the date of the breach of contract, in tort it expires six years from the date that the damage is first suffered”.[2]
As I understand the plaintiff’s submissions, the plaintiff accepts that s 11 applies in relation to his claim in contract and accepts that the cause of action first accrued to him when the contract was allegedly breached at the time of the work being carried out – that is, in 2005. Rather, as I understand the pleadings and submissions, the plaintiff asks that the Court extend the limitation period pursuant to s 40 of the Limitation Act.
No separate extension application was made and the precise terms in which an extension is sought are not set out in the pleadings or the submissions. Be that as it may, no procedural objection was raised by the defendants and it is tolerably clear that what is sought is an extension to the date upon which the claim, as amended, was in fact filed.
It is necessary, therefore, to consider the merits of an extension application under s 40 of the Limitation Act.
Before doing so, it is convenient to refer to the plaintiff’s claim in the alternative (at least as pleaded) – that is, the cause of action based in negligence. The limitation period in relation to that claim runs from the date that damage is first suffered.[3] The plaintiff says that the relevant date for the commencement of the limitation period is 2011 because the first defendant installed non-compliant guttering at the Macquarie Project and that “it was not until 2011 that Mr Alcock was able to discover that fact and that the damage to the Macquarie House had been caused by KEM’s negligent conduct”.[4]
The proceedings were commenced by the filing of an originating claim and a statement of claim on 16 January 2015. The submissions by both parties on the limitation period in relation to the claim in negligence do not engage (despite my invitation) with what are two fundamental points. They are, first, that the plaintiff was not the owner of the property, and, second, that a cause of action in negligence does not accrue until a plaintiff sustains loss or damage.[5] If the plaintiff’s allegations of negligence against the first defendant were pursued, he had some potential or contingent liability to the owners of the property as a result of the work performed by the first defendant as subcontractors to him, but he (the plaintiff) suffered no actual loss or damage until such time as he was called upon to repair what he asserts was the first defendant’s negligent work.
The authorities cited by the parties about the significance of a defect being latent or patent, and when it could, with reasonable diligence, have been discovered are limited in their application to claims made by the owners of the properties affected. That is not the plaintiff’s position.
Wardley Australia Limited v Western Australia [1992] HCA 55; 175 CLR 514 dealt with the accrual of a cause of action for misleading and deceptive conduct under s 52 of the Trade Practices Act 1974 (Cth). A majority of the High Court of Australia saw the case as one where damages at common law were the appropriate guide and that the plaintiff could recover compensation only for actual loss or damage as distinct from potential or likely damage. The Court concluded that although detriment in a general sense had been suffered, no actionable damage was suffered until the loss became actual rather than prospective.[6]
By application of the same reasoning, no cause of action in negligence accrued to the plaintiff until he sustained loss by way of having to do the reparation work ordered by ACTPLA. If he had not been required to do that work by ACTPLA (or, alternatively, by the owners directly) he would have suffered no loss and no cause of action in negligence against the first defendant would have accrued. No question of the diminution in value of the property arises in a case such as this, where the plaintiff is the builder, rather than the owner, of the property in question.
There is some evidence that the plaintiff carried out some minor repair work at an earlier point in time. However, even if incurring the expense of that work was the point in time at which the cause of action accrued, that was within six years of proceedings being commenced.
It follows that insofar as the plaintiff’s claim in negligence (as pleaded) is concerned, the proceedings are not outside the limitation period. It is appropriate, however, that despite that conclusion, I also deal with the extension application insofar as the plaintiff’s claim in contract is concerned.
Section 40 of the Limitation Act applies to “a cause of action for latent damage to property or for economic loss in relation to such damage to property”. As I understand the defendants’ submissions, they are that the plaintiff’s cause of action (whether in contract or negligence) is not for latent property damage or for economic loss in relation to latent property damage, such that s 40 does not apply.
I have already commented broadly that the authorities dealing with claims by owners of property suffering from what are called latent defects do not apply to the plaintiff’s situation because he was not the owner of the property in question.[7] For the same reason, the plaintiff’s cause of action is not one “for latent property damage” within the meaning of s 40. The question which remains for consideration is whether the plaintiff’s claim falls within what is described as “economic loss in relation to such property damage”.
In Owners – Units Plan No 1917 v Koundouris [2016] ACTSC 96; 307 FLR 372, his Honour Mossop AsJ defined latent damage as follows:
Latent damage is damage which is “hidden” or “concealed”, “present but not visible or apparent” (Macquarie Dictionary, 6th ed). A latent defect is “a hidden defect which could not have been discovered by reasonable examination” (Macquarie Dictionary, 6th ed). In the case of building damage, latent damage is damage which, although arising from an earlier breach of tortious or contractual duty, does not manifest itself for a period and is not otherwise reasonably discoverable.
The defects alleged by the plaintiff in this case did not immediately manifest themselves at the time of the completion of the work. The first complaints about the roof by the owner were not made until some time after the work had been completed.
The first defendant says that the defects asserted by the plaintiff are not latent defects, because the plaintiff was or should have been aware of at least some aspects of them – in particular, that flashing had not been installed in the manner in which he asserts it should have been.
I am not persuaded that the defects were otherwise reasonably discoverable at the time the work was completed. It is true that the plaintiff is a qualified builder with skills and experience, and that he inspected the work done. But that does not inevitably lead to a conclusion that the defects were reasonably discoverable.
As I understood his testimony, the plaintiff does not say that he specified the type or extent of the flashing to be installed by the first defendant, only that the flashing be installed. He says that he relied on the expertise of the first defendant as the operator of a specialist roofing business. By the time the hearing took place, the plaintiff had engaged another roofer to carry out rectification works and had formed certain views about how the defendant should have carried out the work in the first place, including about the type and extent of the flashing. The fact that he had subsequently formed those views after the rectification works does not mean that he should reasonably have recognised and discovered what he says is deficient flashing at the time the work by the first defendant was done.
It is not in dispute that the plaintiff had inspected the work after completion, he had subsequently received complaints from the owners about leaks and had been up onto the roof again as a result. He also had various exchanges with Mr Chesterfield in which he says he was told that the source of the problem would be vegetation. In the circumstances, I am not persuaded that his observations on any such occasion result in the defects being anything other than latent for the purposes of s 40 of the Limitation Act.
In the circumstances, I am persuaded that the alleged building defects comprise latent damage for the purpose of s 40 of the Limitation Act and that the plaintiff’s claim is one for economic loss in relation to such damage. Those conclusions pave the way for consideration of the plaintiff’s claim for an extension of the limitation period.
The exercise of the discretion to extend the limitation period is governed by the requirement in s 40(2) to have regard to all the circumstances of the case, including:
a) the length of time between the occurrence of the damage or loss and the time when the damage or loss might reasonably have been discovered by the plaintiff;
b) the extent to which the plaintiff, after he or she became aware of the damage or loss, acted promptly and reasonably;
c) the extent to which an extension of the limitation period would or would be likely to, result in prejudice to the defendant;
d) the conduct of the defendant after the relevant cause of action accrued to the plaintiff, including the extent to which the defendant took steps to make available to the plaintiff means of ascertaining facts in relation to the cause of action;
e) the steps (if any) taken by the plaintiff to obtain, for the purposes of the cause of action, legal or other expert advice and the nature of any such advice.
I will deal with each of these listed factors in turn.
The length of time between the occurrence of the damage or loss and the time when the damage or loss might reasonably have been discovered by the plaintiff
The point in time at which the “damage or loss” could reasonably have been discovered by the plaintiff must take into account his exchanges with the second defendant. I am not persuaded that Mr Chesterfield knew of the existence of the defects and knowingly mislead the plaintiff about them. Rather, the evidence supports a conclusion that Mr Chesterfield was indifferent to the plaintiff’s concerns and sought to avoid the need for any investigation or further work on his part by telling him, without investigation, that the problem was caused by vegetation.
On the basis of the plaintiff’s own testimony, he knew that the response he received from Mr Chesterfield – that is, that the problem was caused by vegetation – was an opinion given by Mr Chesterfield without having carried out any investigation of the problem. In circumstances where the plaintiff had engaged the defendants because roofing was their business, it was perhaps not unreasonable for the plaintiff to accept in the first instance what he says he was told by Mr Chesterfield. In other words, it was reasonable for him not to undertake further investigation when the first complaint was made. However, when the problem persisted, and despite what he says he was being told by Mr Chesterfield, a point in time did arise when it was no longer reasonable for the plaintiff not to undertake further investigation.
My understanding of the plaintiff’s testimony was that the first complaint came from the homeowner in early 2006 with subsequent complaints in late 2006 or early 2007, again in 2008 or 2009, and yet again later in 2009. My conclusion is that when a third complaint was made, the plaintiff ought to have conducted further investigation about the possible causes of the complaint. That was the point in time at which “the loss or damage might be reasonably have been discovered”. On the basis of the plaintiff’s testimony, that point was reached in 2008 or 2009.
Despite that point having been reached at that time, no meaningful investigation was undertaken by the plaintiff until he was ordered to remediate the work by ACTPLA on 7 March 2012. If the third complaint was made in early 2008, that investigation by the plaintiff was some four years after the damage might reasonably have been discovered. If it was in late 2009, then that was some two-and-a-half years after the damage might reasonably have been discovered. Proceedings were not commenced until 16 January 2015, being somewhere between seven years and a little over five years after the damage might reasonably have been discovered.
The extent to which the plaintiff, after he became aware of the damage or loss, acted promptly and reasonably
I accept the testimony of the plaintiff that he became aware of what he alleges was the defective work in 2012 at the time of the ACTPLA rectification order. I accept the testimony of the plaintiff that following receipt of the rectification order, he contacted Mr Chesterfield about it. I infer that he made that contact within a reasonably short period of time after receiving the order. I regard him as having acted promptly in bringing that order to the attention of Mr Chesterfield, although he did not commence proceedings until almost three years later, on 16 January 2015.
The extent to which an extension of the limitation period would, or would be likely to, result in prejudice to the defendant
Counsel for the plaintiff submits that there is no prejudice because Mr Chesterfield has known since 2005 that the work did not comply with the Building Code of Australia (‘BCA’) and has actively concealed that fact. I have already noted that the evidence falls short of satisfying me that Mr Chesterfield knew of the alleged defects and knowingly took steps to mislead the plaintiff about them. The evidence does establish that Mr Chesterfield knew of the plaintiff’s complaints about the work from an early date but that does not mean that no prejudice is suffered by the first defendant from an extension.
The defendants submit that there is actual prejudice caused by any extension of the limitation period. The submissions point out that the director of KEM, Mr Bill Durham, gave evidence of first becoming aware of the claim against KEM only a few months before proceedings were issued, and that KEM disposes of records after seven years such that he did not have records for the 2005 period.[8] The submissions also raise, self-evidently, that memories fade over time. At the time of giving their testimony on this subject the witnesses were speaking of events which had taken place some twelve years before.
I have taken into account on the question of prejudice my conclusion that the cause of action in negligence is within time. The elements of a claim in contract and in negligence are different, as are the consequences of findings favourable to the plaintiff, although there is much overlap in the evidence that would be relied upon to support both the negligence claim and the contract claim. However, the significance to be attached to the availability to the plaintiff of an alternative cause of action in negligence is not a simple issue.
On one view, the availability of an alternative claim can be seen to weigh against the exercise of the discretion to extend time. In Chambers v Northern Coast Area Health Service [2005] NSWSC 833, Hoeben J (as his Honour then was) considered an application to extend the limitation period for a plaintiff’s cause of action in negligence to the date on which the statement of claim was filed. In that case, an alternative cause of action (also in negligence) was available to the plaintiff against her former solicitors which was not statute barred – indeed, in that case, such proceedings were already on foot. In considering this issue, his Honour said at [41]:
The effect of the authority to which the court has been referred is that while this consideration is relevant, it is not a factor which of itself is sufficient to prevent an extension of time being granted where other factors justify such an extension. I do not place much significance on the proceedings already commenced against the solicitors. This was an obvious defensive move to prevent such a claim itself becoming statute barred.
Similarly, in Andresakis & Skouteris trading as Andresakis & Associates v Alexus Holdings Pty Ltd [2006] NSWCA 294; 68 NSWLR 507, her Honour McColl JA (with whom Giles and Hodgson JJA agreed) at [92] said:
Accordingly it is correct to say that the primary judge erred in dismissing the prospect that the respondent had a cause of action against its former solicitors as “an impermissible consideration”. It was a relevant consideration, but one whose weight depended on the circumstances. The authorities to which I have referred have accorded the prospect of a secondary cause of action little weight, partly because of the difficulty of evaluating the prospects of success.
The circumstances before me clearly differ because here the alternative (secondary) cause of action lies against the same plaintiff and has been brought in the same proceedings.
On the other hand, the existence of separate claims arising from the same facts ostensibly undermines, from an evidentiary point of view, at least some of the force of the argument that prejudice is likely to be suffered by the defendants in this case. In other words, because the claim in negligence is within time, the defendants are subject in any event to the prejudice of having to meet a case based upon long past events.
Having said that, I see no basis for reading down s 40(2)(c) of the Limitation Act so as to take into account only what might be regarded as any additional detriment component as constituting prejudice. Indeed, to do so would appear to be contrary to the general tenor of the authorities in this area.
In Brisbane South Regional Health Authority v Taylor [1996] HCA 25; 186 CLR 541, the High Court considered an appeal from a decision of the Court of Appeal of Queensland. At first instance, the District Court of Queensland dismissed an application under the relevant statute to extend the limitation period to allow the plaintiff (the respondent in the High Court proceedings) to bring an action against the defendant (appellant). The Court of Appeal overturned that decision. A majority of the High Court, allowing the appeal from the Court of Appeal’s decision, held that the primary judge was correct. In a separate judgment, his Honour McHugh J (with whom Dawson J largely agreed), set out some general principles underlying the exercise of the discretion to extend a limitation period where prejudice is either presumed or proved. His Honour stated at 555:
When a defendant is able to prove that he or she will not now be able to fairly defend him or herself or that there is a significant chance that this is so, the case is no longer one of presumptive prejudice. The defendant has then proved what the legislature merely presumed would be the case. Even on the hypothesis of presumptive prejudice, the legislature perceives that society is best served by barring the plaintiff’s action. When actual prejudice of a significant kind is shown, it is hard to conclude that the legislature intended that the extension provision should trump the limitation period. The general rule that actions must be commenced within the limitation period should therefore prevail once the defendant has proved the fact or real possibility of significant prejudice. In such a situation, actual injustice to one party must occur. It seems more in accord with the legislative policy underlying limitation periods that the plaintiff’s lost right should not be revived than that the defendant should have a spent liability reimposed upon it.
His Honour went on to note that the interpretation given to the relevant statutory provision in that case by the Court of Appeal made it such that a court considering an extension application was only required to consider the additional prejudice suffered after the expiry of the limitation period. That is, if, in practical terms, a defendant would have been prejudiced (by the deleterious effects of the effluxion of time on memory and documentary records) even if the action was brought in time, a court could nonetheless only take into account the additional prejudice suffered after the expiry of the limitation period in considering an extension application. His Honour observed that the effect of this interpretation “would make the expiry date a mere reference point setting a provisional limit on the commencement of an action. It overlooks the rationales that have persuaded legislatures for more than four centuries that, generally speaking, civil actions should be commenced within fixed periods”.[9]
The principles articulated in relation to limitation periods in Brisbane South Regional Health Authority v Taylor [1996] HCA 25; 186 CLR 541 were said to be applicable to the operation of s 40 of the Limitation Act by his Honour Mossop AsJ in Owners – Units Plan No 1917 v Koundouris [2016] ACTSC 96; 307 FLR 372 at [540].
In the end result, my conclusion is that there is prejudice to the defendants if the limitation period on the contract claim is extended. Having regard to what is in contest in these proceedings, the likely prejudice is material.
The conduct of the defendant after the relevant cause of action accrued to the plaintiff, including the extent to which the defendant took steps to make available to the plaintiff means of ascertaining facts in relation to the cause of action
It is appropriate at this point to consider all of the exchanges between the plaintiff and Mr Chesterfield following the multiple occasions upon which complaints were made to the plaintiff by the owners about the roof.
The plaintiff in his evidence says that the first complaint was made to him by the homeowners in early 2006. He said that several complaints were made subsequently. He said that on each occasion he contacted Mr Chesterfield asking him to inspect the property. He said that, on each occasion, Mr Chesterfield refused to inspect the property, telling him that he knew what the problem was, namely, a “vegetation problem” and that the gutters needed to be cleaned out. The plaintiff said that when he checked he discovered that there were leaves in the gutters and he did not investigate further.
As noted earlier, the plaintiff said that similar exchanges took place following complaints in late 2006 or early 2007, again in 2008 or 2009, and again later in 2009. The plaintiff said that on each occasion, Mr Chesterfield refused to inspect the site and told him that the problem was vegetation. The plaintiff also said that Mr Chesterfield expressly told him during that period that he had put the flashings in.
I do not attach much significance to Mr Chesterfield refusing to inspect the site other than that to which I have already referred. The plaintiff’s argument would be stronger if Mr Chesterfield had inspected the site and somehow mislead the plaintiff about the cause of the leak. But he did not inspect the site and the evidence does not support a conclusion that he necessarily knew that the leak was not caused by what he suggested – that is, vegetation.
As to the plaintiff’s evidence that Mr Chesterfield told him that the flashings had been installed, I similarly do not attach much weight to that. The plaintiff gave evidence at the hearing about what he expected by way of flashings and what had subsequently been installed, but I understood he was speaking of what he now regarded as best practice, having engaged another tradesman to rectify the work and seen how that was carried out. There was no evidence that he had specified what flashing was to be installed for the job or that he had been precise in his question of Mr Chesterfield about whether flashings had been installed.
As to the general question of the making available to the plaintiff of the means of ascertaining the facts in relation to the cause of action, the reality is that the plaintiff could have carried out a detailed inspection of the roofing work which had been done at any time, especially given that the homeowner was a relative of the plaintiff. Given the number of complaints about leaks, it is perhaps surprising that he did not do so at an early stage.
The steps (if any) taken by the plaintiff to obtain, for the purposes of the cause of action, legal or other expert advice and the nature of any such advice
Upon receiving a complaint from the new owners in 2011, the plaintiff encouraged them to make a complaint to ACTPLA. They did so, triggering an inspection which revealed work requiring remediation.
There is no evidence that the plaintiff took any steps other than in response to the complaints made to him, either by the original owners or the new owners.
Consideration of the discretion to extend the limitation period
The decision required of me is whether it is just and reasonable to extend the limitation period. The plaintiff bears the onus of persuading the Court that it is.[10] Some factors considered weigh in favour of granting the extension sought and some weigh against doing so. I have concluded that the likely prejudice to the defendants is material and that the alleged damage ought reasonably to have been discoverable by the plaintiff in 2008 or 2009 when he says the third complaint was made to him by the owners. They are material considerations. Against the background of those considerations, I am not persuaded that it is just and reasonable to extend the limitation period in relation to the plaintiff’s claim in contract.
The plaintiff’s claim in negligence in relation to the Macquarie Project.
Having reached the conclusion just recorded on the plaintiff’s extension application for his claim in contract, what remains for consideration is his claim in negligence.
The claim is defended on several bases. There is, however, an important preliminary issue to be determined. In written submissions filed on 12 June 2019, the plaintiff’s lawyers say that his claim is a claim for contribution under s 21 of the Wrongs Act. The submissions could be read as suggesting that the plaintiff was intending to make that claim against the second defendant personally. The defence responded to them as if they did, but in a subsequent communication to my chambers by email the plaintiff’s lawyers made clear that was not their intention.
The defendants do raise another fundamental objection to the submission. It is that the plaintiff did not plead his case as one seeking contribution under the Wrongs Act.
In anticipation of that response from the defendants, the plaintiff’s submissions include the following:
41. The owners of the Macquarie House suffered damage by KEM’s work and sought to recover that loss from Mr Alcock, by way of requiring him to remediate the work. The negligent work done by KEM was undoubtedly a ‘wrong’ by virtue of Part 2.5 of the Civil Law (Wrongs) Act 2002 (the Wrongs Act), which gives rise to a claim for contribution under section 21 of the Wrongs Act.
42. Mr Alcock’s case was run on the basis that KEM was required to indemnify Mr Alcock for the costs he incurred of remediating KEM’s faulty work on the Macquarie House. The distinction between breach of duty and contribution in these circumstances is merely a legal [one] and evidence was led from both sides that could meet a contribution case. No prejudice arises either way. The decision of the High Court of Australia in Vale v Sutherland (2009) 237 CLR 638 makes clear (at paragraphs 38-41) that it is no bar to a plaintiff’s success that a case is pleaded one way and argued another. At the centre of these proceedings was always that Mr Alcock sought repayment from Mr Chesterfield of the monies he outlaid to repair Mr Chesterfield’s fault work and whether Mr Chesterfield’s obligation to do that arises out of a duty of care to Mr Alcock, or an obligation to contribute under Part 2.5 of the Wrongs Act makes no material difference to Mr Alcock’s case against KEM.
In their written submissions in response, the defendants say, in summary:
a case for contribution was not pleaded or raised until the submissions were filed;
the case was not conducted in a way which would permit the court to decide it on a basis different from that which was pleaded;
if the plaintiff’s claim was one raising a statutory case including a claim for proportionate liability, it was required to be pleaded as such;
the submissions raise not simply a different legal argument based upon the evidence, but rather seek to raise a new cause of action;
in any event, the plaintiff’s obligation to repair the roof arose from a statutory obligation raised by ACTPLA issuing a notice to rectify (which did not establish a claim in negligence) and the plaintiff has not had to pay money to the house owners; and
the defendants are taken by surprise.
I understood the second last item above to be a reference to the pre-condition in s 21 – that is, that the ACTPLA rectification order does not of itself establish that the plaintiff is a person “liable for damage caused by a wrong” for the purposes of the Wrongs Act.
I agree with the defendants’ submissions. I was surprised to read the plaintiff’s submissions couched as they were. The plaintiff was not legally represented when the hearing commenced, although he had been when the original statement of claim was filed. He was again represented by the commencement of the adjourned hearing on 26 March 2018 and an amended statement of claim had been filed by leave on 16 February 2016. So far as I can see, there is no reference anywhere in the original or amended pleadings to a claim for contribution or to the Wrongs Act.
In addition, I did not perceive that the case was run before me as one seeking contribution under the Wrongs Act. I am fortified in that perception by the response to the procedural direction that I made during the course of the hearing. The direction was that the parties agree upon and submit an agreed list of issues which their written submissions would then address in the order agreed upon. That agreed list of issues makes no reference to contribution or the Wrongs Act. The submission made on the plaintiff’s behalf is under what appears in the agreed list as “Issue 6: Whether the First Defendant owed the Plaintiff a duty of care in relation to the Macquarie Works”. In the written submissions under that heading, the plaintiff opens with “Whether KEM owed Mr Alcock individually a duty of care is irrelevant because on any view it owed a common law duty to the owners of the Macquarie House and their successors in title”.[11]
The defendants, in their written submissions, refer to the decision of his Honour Hammerschlag J in Ucak v Avante Developments [2007] NSWSC 367 (‘Ucak’) as authority for the proposition that “any claim that raises a statutory case, including a claim for proportionate liability, must be pleaded and cases involving contribution are required to be specifically pleaded as well”.[12]
In Ucak, his Honour dealt with the issue of what is required to be pleaded by a party in relying on a defence under the proportionate liability provisions of the Civil Liability Act 2002 (NSW), specifically relating to the provisions concerning concurrent wrongdoers. His Honour stated at [33] – [35]:
If a right or defence depends, as is the case here, upon the provisions of a statute, the claim must state material facts demonstrating the entitlement … It follows in my view, that for a defendant to assert that there is a person who is a [con]current wrongdoer the defendant must plead the necessary elements which result in the asserted conclusion.
I do not accept that the decision in Ucak is authority for the strict approach to pleading requirements pressed for by the defendants. As I understand his Honour’s reasons, the requirement is not that a contribution claim must be pleaded as such but rather that where a statutory claim is relied upon, it is essential that the necessary elements giving rise to such a claim be pleaded. (Of course, best practice is to expressly plead a claim for statutory contribution as such.)
Having said that, I accept the submission that the plaintiff’s statement of claim did not plead, at least not in any coherent way, the elements necessary to prove a claim for contribution under s 21.
In the end result, I am satisfied that the plaintiff did not plead a claim for contribution under the Wrongs Act and his case was not run on that basis. He is not permitted to raise it in closing submissions.
The plaintiff’s submissions did not address a claim for negligence against the first defendant as pleaded. As already observed, the submissions say that “[w]hether KEM owed Mr Alcock individually a duty of care is irrelevant”. That no doubt caused some difficulty for the defendants in terms of how they responded. The defendants do, however, point out that:
a) any duty which existed was to exercise the degree of care expected of the ordinary skilled person exercising and professing to have the relevant special skill;
b) there was no independent evidence of what is done in the roofing industry which would serve as a guide as to the assessment of the first defendant’s conduct; and
c) there is no evidence as to roof dimensions or the like which would permit the court to conclude that the guttering installed did not meet the requirements of the BCA.
The plaintiff did not reply to the defendants’ written submissions.
Having regard to the above, the plaintiff’s claim against the first defendant in negligence is dismissed.
The Lyneham Project
I turn now to deal with the plaintiff’s claim in relation to the work done on a house in the suburb of Lyneham.
Background
The plaintiff says that an oral agreement was formed between him and the first defendant for him to do certain things and that he would be paid an amount of $2,000.00 and an hourly rate of $120.00 for the work that he agreed to do.
The defendant says that the agreement entered into with the plaintiff was that the plaintiff would do what was required of him without charge, and that, in any event, that agreement was one between the plaintiff and a different company – namely, ReAct Guttering & Fascia Pty Ltd.
The following facts are not in dispute:
a) A roofing job was being carried out at the Lyneham Project site.
b) WorkCover ACT ordered that work on the Lyneham Project cease because of concerns about asbestos.
c) Mr Alcock and Mr Chesterfield had a conversation about Mr Alcock assisting with work on the Lyneham Project because WorkCover had intervened.
d) Mr Alcock subsequently attended the site, ‘put his licence’ on the job, and thereafter attended the site again on other occasions. (The number and purpose of other attendances are matters in dispute.)
I deal first with the evidence from the parties about what each says was agreed.
The evidence of Mr Alcock
The plaintiff gave evidence that he and the second defendant discussed the Lyneham Project in July 2010 at the Giralang house.[13] The plaintiff said that second defendant asked if he (the plaintiff) could “put my builder’s licence on the project and oversee the project as the builder to get the project back on track”.[14] The plaintiff agreed to help. In his evidence, he stated that in the course of that conversation, it was discussed that the work would be undertaken on an hourly rate.[15] The particulars of the conversation at the Giralang house were recalled by the plaintiff as follows:
I gave – I said to Paul – it’s hard for me – my exact words were, “Paul, I don’t know exactly what you want to engage me to do. Am I doing physically roofing work or physically doing any work? I’m engaging any contractors? I’m placing my licence on it. Am I finishing the product off – project off and am I giving you a price for it?” He said, “No, I just want you to take over, get the asbestos side of it corrected so basically you’ll just be supervising and putting your licence on the job.” So I said – to put licence on the job with a high risk job like that, even though it’s a small project, I would charge $2000 and I would charge him $120 an hour to sit there and supervise and that’s engaging me, not supplying any materials, contractors or anything else and give the job back to where WorkSafe will be happy for it and then Paul could then finish the roof side of it.[16]
In a subsequent exchange with his counsel, the plaintiff clarified that he told the second defendant that he would charge $2,000.00 to “put my licence” on the job, and $120.00 per hour on top of that fee to oversee the job until the roofing work could re-commence.[17] He said that because the second defendant was experiencing financial difficulty associated with the ongoing litigation in relation to the Giralang house, the second defendant asked if the plaintiff “could do the project and he could pay me sort of basically when this white ant matter got resolved”.[18]
The plaintiff said that when he visited the site, he spoke with a Mr Richard Siddall and identified some concerns with the state of the project. Mr Siddall apparently responded by saying words to the following effect: “Great. I can see that you’re focused and you know what you’re doing on the site”. He then apparently added, “I’m happy to release the job over to Bob once his licence is on it and there’s a private certifier on it”.[19]
Following this meeting, the plaintiff stated that he went to ACTPLA, put his licence on the job and met with the private certifier to whom he gave his licence number. The effect of this, he said, was “that then becomes my principal site to look after”.[20]
When asked whether the second defendant told the plaintiff that he did not want the plaintiff to do the work, the plaintiff stated: “No, Paul and I agreed that what I would do from that point is put my licence on it. I would only supervise to make sure that these asbestos guys complied and basically run the safety aspect of the site, get these asbestos guys finished so React Roofing and Paul could come back and finish off the roof and get the job completed”.[21] He further stated that he went to the site every morning for about four hours or more from around 16 July 2010. When asked how many days he attended, he estimated approximately five.
The plaintiff gave evidence that while on the job, he would oversee the work done by the workers removing asbestos from the property. He also gave evidence that an inspector from “Robson Environmentalist” attended the property to determine whether the asbestos had been removed in accordance with the relevant requirements. The plaintiff said that he spoke with the inspector on the first occasion that the inspector attended the property. The same or another inspector returned to the property on two further occasions after a determination was made that further work was needed.
After the removal of asbestos had passed inspection, the plaintiff stated that he contacted the second defendant to convey this news. The second defendant attended the site either that same day or the day after, accompanied by another male identified in the plaintiff’s evidence as “Wade”. The plaintiff described Wade as the individual who had done the original work that had been inspected by WorkSafe.[22] The plaintiff said that he instructed the second defendant and Wade on how to strap down the roof. After the roof was complete, the plaintiff stated that he received a Certificate of Final Occupancy, which he described as a “plaque [that he received] because my licence was on it stating that the work was completed”.[23]
During the course of his evidence, the plaintiff identified two documents (which collectively became Exhibit P22). The first consisted of a summary of the work done by the plaintiff on the Lyneham Project. The notes were prepared, according to the plaintiff’s evidence, at the time of the work being performed.[24] The second document was also identified by the plaintiff as recording the work done by the plaintiff at the Lyneham Project. According to his evidence, some parts of this document were prepared at the time of doing the work, and some parts were prepared a matter of days later.[25]
The plaintiff also identified an invoice addressed to the second defendant (which became Exhibit P23) for the work done by the plaintiff (described in his identification of Exhibit P22) at the Lyneham job. The plaintiff gave evidence that he discussed the invoice with the second defendant when he was undertaking the work. He said that he told the second defendant that he would invoice the second defendant for the work and send that invoice to him. The plaintiff indicated that the second defendant had said “that was fine”.[26] The plaintiff stated that the invoice has not been paid and the plaintiff had not directly discussed that non-payment with the second defendant. The plaintiff sent a letter of demand to the second defendant referring to the outstanding payment in January 2013.
The plaintiff gave evidence that he had, prior to the Lyneham Project, “put his licence on” other jobs for the second defendant. It was put to the plaintiff in cross-examination that he did not charge the second defendant for those jobs. The plaintiff explained that he had charged the second defendant for those jobs, but that they were charged “on the Macquarie job”. This aspect of the plaintiff’s evidence was somewhat confusing, and led to the following exchange between counsel for the defendants and the plaintiff:
[MR BLANK:] So you’re suggesting that the job for $15,000 at Macquarie has a discount built into it for all the sites where you have applied your licence somewhere else?---For React Roofing, yes.[27]
In further cross-examination about the Lyneham Project, the plaintiff accepted that he did not need to spend all his time overseeing the removal work on site. He stated that he would stay there for “four-odd hours and sometimes I would go away and come back”.[28] The plaintiff accepted a proposition that if the amount for specific work undertaken charged in the invoice to the second defendant was $4,752.00 and the price quoted for the work was $120.00 per hour, then the plaintiff would have spent approximately 39 hours of work on the site. That amount of time spent in supervision would be almost twice that referred to in the plaintiff’s evidence-in-chief at paragraph [94] above.
The plaintiff maintained the position that he had held off, at the second defendant’s request, sending the second defendant an invoice for his work at the Lyneham Project. It was put to the plaintiff, and he accepted, that the company name that appeared on the invoice as the issuer was Imaginative Concreting and Construction Pty Ltd, a company which was incorporated on 9 August 2011. However, the plaintiff maintained that he generated the invoice in July 2010, but that he only sent it to the second defendant on 6 May 2013. It was put to the plaintiff that this was incorrect. The plaintiff rejected this assertion and explained the reference to the company on the basis that the invoice could have been re-generated electronically in 2013 and sent out bearing the details of a company which, in July 2010, did not yet exist.[29]
In the course of re-examination, the plaintiff was asked to clarify how the invoice for the Lyneham Project came into existence. The plaintiff said that he had originally handwritten parts of the invoice back in July 2010. The invoice was then placed on a file with other documents relating to the second defendant. He stated that he probably gave the document to his wife a few weeks before the invoice was sent to the second defendant in 2013. The invoice (in the form it was tendered) was produced, the plaintiff said, by his wife preparing an electronic version of the invoice based on that original handwritten document.
The evidence of Mr Chesterfield
The second defendant said that after he was notified of the closure of the site by WorkCover he had a discussion with the plaintiff. During the course of that discussion, the issue of the closure came up. The effect of the conversation about that issue was that the plaintiff had had prior dealings with the representative from WorkCover – a person the second defendant identified as “Richard” – and that he (the plaintiff) would visit the site with the second defendant. The second defendant said that at no point – either prior to meeting at the site or after – had there ever been a discussion of a fee for the plaintiff to attend the site.
The second defendant gave evidence that he and the plaintiff had a conversation with the WorkCover representative at the site of the Lyneham Project. After that conversation, the second defendant said that he and the plaintiff had a further conversation about the plaintiff putting his building licence on the job. He said that that the plaintiff agreed to do so.[30]
After that visit, the second defendant said that he engaged an asbestos removal company and access to the site was restricted to persons wearing appropriate protective equipment.[31] When asked what continuing role the plaintiff had in relation to the site, the second defendant said that he was only able to identify two occasions with certainty that the plaintiff would have attended the site. First, he said that the plaintiff attended on the first occasion when they had the discussion with Richard from WorkCover. Second, he said that the plaintiff attended the site on one afternoon to check that the roof was tied down. The second defendant also conceded that the plaintiff:
could have been with me [at the site] on and off there, because we had to – I mean, I was curious to see who was doing what and what was going on, so we would drive past, but we certainly didn’t stand there and make sure nobody from the public came in the gate or any of that kind of stuff. We didn’t need to. It was all locked.[32]
The second defendant was told that the plaintiff had given evidence that he was spending about four hours a day at the site. The second defendant disputed this, stating that “I don’t think the asbestos guys were there four hours a day. Anyway”.[33] The second defendant also stated that there had not been any discussion about the plaintiff being paid for his time and effort in relation to the Lyneham Project. He stated that the first he had heard of the plaintiff charging $2,000.00 for the use of his licence on the job and $120.00 per hour for his time was during the plaintiff’s oral testimony at Court.[34]
When asked to comment on the plaintiff’s evidence that he (the plaintiff) had been told by the second defendant not to send an invoice in relation to the Lyneham Project until the second defendant’s financial difficulties in relation to his ongoing litigation had eased, the second defendant said, “I borrowed money for the termite court case from a family friend. I also had an agreement with Jaylee [sic] [his solicitor] that she wouldn’t charge me until the end. It was all going to be pro bono, so I don’t understand why he would say that”.[35] His evidence was that he did not have such a conversation with the plaintiff, adding, “We were friends. I didn’t think I was being charged. And if I thought I was being charged then, a lot of things would have changed”.[36] He said the first time he became aware that the plaintiff was charging him for the Lyneham Project was after he received the letter marked as Exhibit P16. Exhibit P16 is a letter of demand in relation to the Giralang Project. In an exchange with counsel for the defendants, the second defendant’s evidence was clarified to be that it was not by virtue of Exhibit P16 that he became so aware. Rather, the first time he did become aware that he was being charged for the Lyneham Project was at least not until after February or March 2012.[37]
In cross-examination, the second defendant said that he thought the suggestion for the plaintiff to put his licence on the job came from the plaintiff. He said that the conversation about this would have taken place just before they arrived at the site. He rejected the suggestion that the act of putting his licence on the job meant that he assumed a lot of responsibility. He said that the plaintiff was accustomed to putting his licence on such jobs “because we were mates”, and that it had nothing to do with the asbestos removal, but rather “just to make sure that we strap the roof down properly”.
The second defendant said he could not recall having a conversation with the plaintiff about the plaintiff supervising the asbestos removal. When it was put to him as a suggestion that such a conversation had taken place and that the role of the plaintiff would be to bring the site back up to clearance, the second defendant rejected the suggestion. Further, the following propositions were put to the second defendant:
a) First, that the second defendant had said to the plaintiff, “How much will that cost?”. The “that” referred to was presumably the act of the plaintiff putting his licence on the job. The second defendant said that he did not ask that question.
b) Next, that the plaintiff said to the second defendant, “I can’t give you a fixed price, because the cost will depend on how many hours I am required to be on site”. The second defendant rejected that this had been said, suggesting that perhaps it had been confused with him asking the plaintiff, “What do you think this is going to cost me?”. He further explained, “I think Bob’s [the plaintiff’s] confused that, perhaps, with I’m paying him. But I don’t know how, because we’re mates, and we weren’t charging each other for anything”.
c) Next, that the plaintiff had said that it “would cost $120 all up” and that the second defendant knew that the plaintiff’s hourly rate at that time was $120.00 an hour. The second defendant rejected both propositions.
d) Next, that between 16 July and 24 July 2010, the plaintiff attended the site for four hours every morning. The second defendant said that doubted that to be true, explaining, “I think he was there twice; once when we first got there, and once, one afternoon late, driving past, I think on the way or way back from a football game, football training, whatever he used to do around that area, just to have a look”.
e) Next, that the plaintiff supervised works on the site during the periods that he was present. The second defendant said that the plaintiff would not have been allowed on the site “because you had to be inducted, and it was fenced off, and if you weren’t an asbestos remover you were not allowed on site”.
f) Next, that the plaintiff called the second defendant when he was on site to give him updates. The second defendant denied that this occurred.
g) Next, that the plaintiff met with Robson Environmentalists at the site. The second defendant conceded that this might have occurred as “they may have been on site that afternoon that he was there, but that would be the only time he spoke or met with them that I’m aware of”.
h) Next, that the house failed its asbestos test several times. The second defendant accepted this proposition.
i) Lastly, that those failures were the reason why the plaintiff kept returning to the site to supervise. The second defendant said that “[i]t wasn’t Bob’s responsibility to make that comply. It was the new engaged asbestos remover. And the reason that they weren’t happy with it was because Workcover kept coming back in, saying, ‘Now what about this, and now what about that?’ Again, they were safety-related issues. They weren’t building or construction issues at all”. The second defendant said that these issues were reported to him by WorkCover.
Analysis of the evidence
There are several aspects of the testimony just referred to which call for careful analysis.
Generation of the invoice
The first issue that calls for analysis is about when the invoice which is Exhibit P23 was generated. In the course of his evidence-in-chief, Mr Alcock had said that he produced the invoice in July 2010. That Exhibit bears a heading which reads “Imaginative Concreting & Construction Pty Ltd” and includes an ABN which is “34 152 559 816”.
As I have already observed, during cross-examination Mr Alcock accepted that the company had been incorporated only on 9 August 2011. The exchange which followed was in these terms:
[MR BLANK:] You gave evidence before that you prepared it in July 2010?---I did prepare it in 2010.
Sir, that was a lie, wasn't it?---No. I prepared the invoice in 2010 but had been typed up - was typed up at - it was printed out at a later stage.
Sir, I suggest that this invoice---?---The company name---
---was created after you incorporated your company and you have accidentally put the company registration on the invoice when you sent it to my client?---This invoice I done in 2010 and I sat it aside with my other paperwork. It could have been regenerated on a computer by my wife and she's mistakenly run it through the company name when she redone it. The date on it was when the date was when I sent the actual documents out. But when she's printed it out I'd say she's mistakenly put the company name on it or got the date wrong.[38]
Various exchanges had taken place in the lead-up to Exhibit P22 being admitted into evidence. That Exhibit was a set of handwritten notes prepared by Mr Alcock. Mr Alcock described that document in the following way:
This is the document I done at the time of doing the work and the hours I wrote. This was taken from another document which unfortunately I don't have in my possession. So what I did is I've done an original document which I would have kept my notes and records on, then I've concised [sic] it back to this document.
[MS PETCH:] Do you remember putting this document together?---Yes, I do.
What is your recollection of putting this document together?---Just a recollection of putting this document together was a summary of the work I'd done, including hoop iron and all the other things I've done. I also put down work complying to Australian standards and stuff and what I was looking for, where I got up to on the job. Then I done it up as a rough copy to do an invoice off to give to Paul.[39]
Mr Alcock was subsequently referred to “page 3” of Exhibit P22. I assume what was intended was page 2. He said some parts of it were prepared during the work and other parts a couple of days later. It is apparent that the contents of the invoice which is Exhibit P23 are more or less identical to what appears in the handwritten second page of Exhibit P22.
The evidence about preparation of the invoice was revisited in re-examination. Mr Alcock said that he had written out the words appearing on the invoice on another piece of paper after he had finished the job in July 2010 and that it had been later given to his wife who prepared and printed the invoice. He said that happened not long before the invoice was sent in 2013. No reference was made to Exhibit P22 in that exchange, but its contents, and the testimony given about it during Mr Alcock’s evidence-in-chief, are consistent with the testimony given in re-examination.
The explanation for the invoice appearing on the letterhead of the company is plausible and does not of itself lead me to reject the plaintiff’s other testimony in this area.
Provision of the invoice to Mr Chesterfield
The next aspect is the evidence that Mr Alcock did not send an invoice for the amount he claims he is owed until long after the work was done, and not until the legal proceedings commenced by the second defendant in relation to his property in Giralang was complete. An inference might be drawn from that evidence that there was no agreement that Mr Alcock be paid for the Lyneham Project and that when the dispute arose about payment for the Giralang Proect, Mr Alcock invented a story about payment for the Lyneham Project as another avenue to recover money from Mr Chesterfield.
When first asked about his invoice in his evidence-in-chief, the following exchange took place:
Have you ever discussed this document with Mr Chesterfield?---I discussed the document with Mr Chesterfield when I was doing the work, that I would invoice him for it and send it to him and he said that was fine.[40]
Earlier in his evidence-in-chief, and in the context of his conversation with Mr Chesterfield about charging for the Lyneham Project, this exchange had taken place:
What did Paul say to that?---Paul said at this time he was struggling with money because of the court case with the white ant matter and (indistinct) be happy if I could do the project and he could pay me sort of basically when this white ant matter got resolved.
What did you say?---Yes, I agreed to it. I knew how much work and solicitors he was going through.[41]
One of the documents put into evidence in the plaintiff’s case (Exhibit P24) was a registered post lodgement receipt showing the invoice (Exhibit P23) had been sent on 6 May 2013. The work claimed for is asserted to have been done in July of 2010.
In the course of his testimony, Mr Chesterfield was asked about the suggestion that he had asked Mr Alcock to defer sending an invoice for the Lyneham Project. The following exchange, referred to above, took place:
What do you say about that?---I borrowed money for the termite court case from a family friend. I also had an agreement with Jaylee that she wouldn’t charge me until the end. It was all going to be pro bono, so I don’t understand why he would say that.
Mr Chesterfield’s response to the proposition just referred to is illogical. The fact that he needed to borrow money for the termite case and had an arrangement with his lawyer not to be charged until completion of the case would support an inference that he also needed to defer payment of any invoice for work for the Lyneham Project. Nevertheless, Mr Chesterfield was adamant that he did not think he was being charged.
If the relationship between the parties had been a business one only then the alleged agreement to defer billing for the Lyneham Project would be most extraordinary. Mr Alcock does not suggest that there was any discussion with Mr Chesterfield about how long the Giralang litigation would take to resolve or whether there would be some limit on how long payment might be deferred or whether, for example, interest might be payable. As things transpired, the invoice was not sent until almost 3 years after the work claimed for had been completed. As a matter of common sense, such a delay in billing for work is well outside usual trading terms. On the basis of Mr Alcock’s own evidence, therefore, the relationship between him and Mr Chesterfield must have had special characteristics to result in that very generous approach to billing for the work. Ironically, it is those very characteristics which Mr Chesterfield relies upon in saying that the work was in fact to be done without charge.
The quid pro quo arrangement
The next aspect of the evidence calling for close analysis is what Mr Alcock said about other jobs for which he had apparently made no charge to “apply his building licence”.
It is not in dispute that Mr Alcock had done other work involving him “putting his licence” on jobs without sending any invoice for doing so. For his part, Mr Alcock says that the work was charged for by way of a quid pro quo. The evidence is relevant circumstantially. If Mr Alcock had not charged for equivalent work previously an inference that he agreed to do the claimed for work on the Lyneham Project without charge might be more readily drawn.
Under cross-examination, Mr Alcock said that there had been about five jobs where Mr Chesterfield needed a licence. He said that was “prior to Macquarie”. He said that Mr Chesterfield rang him, “identified himself as Paul Chesterfield from React Roofing explained the situation that he now required a builder’s licence to do the rooves and could I help him out”.
The following exchange then took place:
[MR BLANK:] Sir, can we focus on the actual question. He asked you to come out and help him on a site?---To put a builder's licence on a project.
All right. You did that?---Yes, that's correct.
You didn't charge him for that, did you?---Yes. It got - did charge him but he took that off the Macquarie job.
I suggest you didn't charge him for doing that?---At that particular time I didn't charge him straightaway. We had a conversation further to what---
Well, just stay with my question, please, sir. You didn't charge him for the job at that time, did you?---Not at that particular time, no.
You did other work where you came and assisted by providing your licence and you didn't charge on those occasions either, did you?---Not straightaway, no, because we made an agreement with Gary Reid.[42]
I set out in full the somewhat lengthy and imprecise exchange which took place later during cross-examination on 27 March 2018.
Those previous jobs where you had - that your licence be used for Mr Chesterfield, you hadn't charged for that, had you?---Because the agreement we made
Well, you charged or you didn't. You didn't charge for it, did you?---It was charged on the Macquarie job as they would give me a discount rate on (indistinct) overcharged.
Let's just pause for a second. You didn't even know there was a Macquarie job at the time you were doing these projects?---Yes, I did. The Macquarie job was open at that time. I was doing the work there and then I started to work at these jobs. It was in 2005. I started Macquarie early 2005. Paul rang me while I was doing the Macquarie job. Mat and I were working at it and I used to go off and do these inspections for him whilst I was working at the Macquarie job.
So you're suggesting that the job for $15,000 at Macquarie has a discount built into it for all the sites where you have applied your licence somewhere else?---For React Roofing, yes.
Your evidence yesterday was that you had done five - and I think this morning you might have said you thought it was seven jobs?---Seven, yes
You put $2000 down for the use of your licence?---On the projects.
According to the Lyneham one you put down $2000?---Yes, because of what it entailed. For minor works like that one for a single licence on a roof just to do a one-off inspection and show the guys how to do tie downs, I would have probably charged $400 - 350.
Until I asked you questions in cross-examination that, as a factor in the price of the job, has never been raised, has it?---You only spoke about the Lyneham job. The Lyneham job, I told you, I based that on - - -
No, but the Macquarie job, you have brought a court case in relation to the Macquarie job and you've said what was involved with it and until I asked you questions in cross-examination you had never mentioned that there was an offset in the price because of previous work that you had done on behalf (indistinct) providing your licence?---In my evidence in 2017, in my written statement, there is a referral, too, where I said to Paul, "Remember the jobs I done for you."
Yes, but there was no suggestion - - -?---That was the offset.
There was no suggestion in that evidence, was there, that there was a price attached to that work?---Yes.
I suggest that any comment about remembering the work that was done is because you work on that basis. You do stuff for him, he does stuff for you, it all works out in the wash. It's not a question of money changing hands?---Then why did he charge me for the Macquarie job?
Because Macquarie was a specific job which you were asked to quote for and he provided it, didn't he?---Based on the fact that I'd helped React Roofing out with those other jobs. I had two quotes in. Paul came in and mentioned about it, and he said, "I'll do it for less than the 17. He never gave me a solid figure because I still had more inspections to do for him.
I suggest that the inspections you'd done in the past were done on the basis that you did them for him and he would do work for you from time to time and it wasn't a question of payment?---At that time, no, because that's the first time I've actually met Paul Chesterfield in person was on one of these jobs, which I think was the one we handed in yesterday. That's where I met the two guys from React Roofing, Paul and Gary, and we got to discussing about how we would proceed with this, and Gary suggested, when I brought up - he asked me about my expertise. I said, "Well, I'm working on a Macquarie job at the moment doing this and this. I need a roof labourer." It was Gary's suggestion that, "Well, we can work something out. You look after us on this and we'll give you a discount price on the roof." I still got quotes to make sure the price I'm getting was fair, and when Paul said he would do it for less than 17 that was less than what the other guys chose and Paul said he'd get there quicker to help me out.
HIS HONOUR: Just let me ask you to clarify that. So you're saying this is a meeting or discussion that took place between you and Gary. Is that right?
---Yes, Gary Reid.
Where and when was this?---It would have been at the Kaleen job, which too was the contract was handed in yesterday as evidence.
What year?---2005.
2005, and you said you spoke about the Macquarie job that you were doing that React was not then involved in?---That's correct.
They said they could help you out with that if you could help them out with the other job?---That's correct. I'm not a hundred per cent sure if it was the Kaleen job back that many years, but it was one of the jobs I first came to and I believe it was Kaleen.
One of the jobs?---Yes.
Okay. So they said they could help you out if you helped them out with what?---With doing the job, putting the licence on it, and basically there was nothing much else - - -
This is if you help out with the Lyneham job?---No, not the Lyneham job. These were the jobs - - -
Just with some other jobs?---Yes. This was back in 2005. The Lyneham job was 2010.
I see. So if you just help out with other jobs generally?---Yes, they said they would have a few of these. They weren't sure how many and they were just in a pickle because they couldn't put rooves on until someone put a licence on it for them.
All right. I think I can follow that.[43]
The matter of other jobs involving Mr Alcock “putting his licence” on the job was re-visited in re-examination. The following exchange took place:
[MS PETCH:] [E]arlier today you said you did maybe seven jobs for Mr Chesterfield prior to the Macquarie job?---Yes.
And that you put your building licence on those jobs. Just picking one of the jobs in your mind, what did - can you name any of the jobs? Can you think of one of the jobs?---There was Banks. There was
Let's go to the Banks job?---Yes.
Do you remember what you were asked to do in relation to that job?---Yes. The same as before. Put a licence on it
If I just stop you there. When you say "put a licence on it", what did that require you to do?---Sign a form from the private certifier. I then would check the contract to make sure the scope of works - so I knew what I was putting my licence to. You know, if I don't see what I'm putting my licence to it could be a new house, could be a lot of things. So I would check that. Then I would basically have a quick conversation with the private certifier, the owner and I think on that job it was Gary Reid.
Okay. So we're just talking in relation to the Banks job?---Yes.
So on that job you read the contract, you checked the scope of works, you spoke to the principal certifier. Is that right?---Yes.
Then what else did you do on that job?---Well, most of the time when I got to the jobs the roof had been opened and I would go up and it would be ready to put the metal battens on. The private certifier was happy to engage it at that point, and then I could go up and inspect what they were doing to make sure the tie down procedures were compliant to the BCA and the appropriate standards and that was it. I didn't watch them put the whole roof on and tie down every fixture point. I would instruct and give them what to do and then that was it.
How long did the work on the Banks project take you?---By the time I talked, went up and had a look, spoke to the guys, probably an hour.
The other six projects that you referred to, did you spend more or less time on those than the Banks project?---The first project I would have spent the most on because we talked a fair bit. After that the time got less.
When you say "the first project", was the Banks - which one was the first project?---I'm not sure if it was Kaleen or which one it was now on dates and times. Sorry, I just - it sort of mixes as one.
Do you remember how - when you say "the longest time", do you remember how long that time was?---I'd say, from memory, it was probably an hour and a half, a little bit more, if that. It was just---[44]
It is apparent from the exchanges just referred to that Mr Alcock says that he understood that the quote from Mr Chesterfield to do roofing work on the Macquarie House (which was owned by one of Mr Alcock’s relatives) would be, and was in fact, discounted as a quid pro quo for other jobs where Mr Alcock had “applied his licence” without charging for doing so.
Mr Alcock referred in his testimony to “an agreement with Gary Reid” and “discussing how we would proceed with this” with “Gary and Paul”. The only evidence going to the terms of any agreement are Mr Alcock’s testimony that Mr Reid had said, "Well, we can work something out. You look after us on this and we'll give you a discount price on the roof”. Mr Alcock also said that he had at some stage said to Mr Chesterfield “remember the jobs I done for you”.
Mr Reid was not called to give evidence, and, importantly, Mr Chesterfield was not cross-examined about whether there had been any arrangement to discount the Macquarie Project to offset any charge for putting Mr Alcock’s licence on other jobs.
There is no suggestion in what was said by Mr Alcock that there had been any discussion of the value of the work for which he was to forego payment. That is, there is no evidence of any attempt at any precise calculation of what might be the value of any offset or discount. In fact, the testimony given by Mr Alcock was that he had accepted Mr Chesterfield’s quote for the Macquarie Project on the basis that he (Mr Chesterfield) had said no more than that the job would be done for less than $17,000.00, that apparently being the price quoted from elsewhere for the same work.
There is no evidence of Mr Alcock having made any record of what he says was the agreement with Mr Chesterfield or of referring to it in any written communication. Further, no evidence was given about what Mr Alcock charged the homeowners for the Macquarie Project and whether they or he ultimately benefitted from the quid pro quo he referred to.
It is a matter of common knowledge that business referral-type relationships exist between independently owned businesses for the benefit of both, and that businesses may from time to time do work for each other on a quid pro quo basis.
The arrangement described by Mr Alcock is that work for which he would ordinarily charge (by way of “applying his licence” to a job) was not charged for on jobs involving Mr Chesterfield on the basis of an informal arrangement for some unspecified discount on a future job for a family member.
It is apparent that if the arrangement was as he described then he carried the risk of Mr Chesterfield not honouring his side of the bargain – that is, of not giving Mr Alcock a discount in an amount which he (Mr Alcock) thought was appropriate having regard to the charges foregone. Despite those considerations, Mr Alcock took no steps to either confirm the arrangement in writing or to quantify the amount of charges which he was foregoing to allow some calculation of what an appropriate offsetting discount would be. And indeed, if the arrangement was as suggested by Mr Alcock, no calculation of any discount was done when he reached agreement on the Macquarie Project, the proposal being only that the job could be done for less than $17,000.00.
One aspect of Mr Alcock’s testimony on this subject calls for particular comment. As I understood his testimony, it was that at least some of the jobs on which he “put his licence” required little of him whereas the Lyneham Project involved him assuming significant responsibility. As I understood his testimony, it was that acceptance of responsibility for which the flat charge of $2,000.00 was made.
The acceptance of responsibility to which he referred is, as a matter of law and logic, a feature of every job on which he “puts his licence”. That observation is reinforced by his own testimony in re-examination where he made clear that he understood that in “putting his licence” on a job his role was to ensure work was “compliant with the BCA and the appropriate standards”.
In the circumstances, I am not persuaded that any arrangement existed for the plaintiff to forego charges for the work described by him on the basis of a quid pro quo “discount” on the Macquarie Project. I reject the plaintiff’s testimony to that effect.
The extent of Mr Alcock’s role on the Lyneham Project
The last aspect of the evidence which calls for close analysis is that about what Mr Alcock says was to be his role in relation to the removal of the asbestos on the Lyneham Project.
I do not accept that the document (Exhibit P22) which the plaintiff says he prepared with a view to billing the defendant reflects the work which the defendant was engaged to do for the defendant.
It is not in dispute that specialist asbestos contractors had been engaged on the job before the site was closed down by WorkCover. As I understood the evidence, it was that the problems giving rise to the shutdown of the site included asbestos drifting onto adjacent government land and at least one unprotected tradesman having been seen working adjacent to an asbestos remover in full protective equipment. Further, and again as I understood the evidence, the original specialist asbestos removalists had been dismissed and new specialists engaged. Mr Alcock says that he was given a broad supervisory role. He says that he expressly quoted both a flat fee of $2,000.00 and ongoing fees of $120.00 per hour.
He says that his proposal was accepted. The tenor of his testimony in this area is that it was accepted without question. Certainly, he gave no evidence of any discussion with Mr Chesterfield about the fees to be charged, or more importantly, about the extent of the supervision which Mr Alcock says that he was to undertake. Despite having industry experience, Mr Alcock was not qualified to do asbestos removal work. He said that he did not go up on the roof. Any supervision role cannot sensibly have been over the technical aspects of the asbestos removal because that was the specialists’ job. Insofar as the earlier problems leading to the site shutdown included an unprotected worked or contractor coming on site were to be covered by Mr Alcock’s supervision, it is difficult to see how that could have been achieved without Mr Alcock being present on site at all times while the asbestos removal was taking place. His evidence is that he was not on site at all such times. That no discussion took place about the extent of Mr Alcock’s supervision in the circumstances described and when, according to Mr Alcock, he was to be paid $120.00 per hour for time spent doing so is inherently unlikely.
Conclusion
The plaintiff had previously provided services by way of “putting his licence” on jobs for Mr Chesterfield without charge. I am not persuaded that any express agreement was made between the plaintiff and Mr Chesterfield or the first defendant for payment in relation to the Lyneham Project. No quantum meruit claim was pursued. Having regard to my conclusion, there is no need for me to make any formal finding as to the amount of time actually spent by the plaintiff at the job site. The plaintiff’s claim for payment for work on the Lyneham Project fails.
The Giralang Project
This part of the reasons deals with the dispute between the plaintiff and the second defendant over payment about assistance provided by the plaintiff in connection with litigation about termite damage at the second defendant’s home in Giralang.
Background
No question of the identity of the entity claimed against arises. It is not in contest that the parties to this dispute are Mr Alcock and Mr Chesterfield.
The plaintiff’s claim is pleaded as comprising both expert and rectification services rendered pursuant to an agreement between the parties and is in an amount of $21,900.00, that being the aggregate of the invoices issued by the plaintiff for what he says were the agreed services he provided.
It is not in dispute that Mr Chesterfield bought a house which was infested with termites, and that he subsequently commenced proceedings against the providers of a pest inspection report which he had obtained at the time of purchase.
It is not in dispute that Mr Alcock did some building related work at the house. What is in dispute is the extent of the work undertaken and the terms of the agreement under which he did the work.
It is also not in dispute that Mr Alcock was requested by Mr Chesterfield to act as an expert witness in the litigation. What is in dispute is the extent of the work performed and the terms of any agreement (if any) under which he did the work.
The evidence of Mr Alcock
The plaintiff’s testimony can be fairly summarised as follows:
a) He was asked by Mr Chesterfield to have a look at a house with him. Mr Chesterfield was having a formal building report prepared by a building inspector and so his role was not to do a formal inspection.
b) He advised Mr Chesterfield not to buy the house because there were “too many issues with it”.
c) Mr Chesterfield bought the property anyway.
d) In about December 2007, he got a call from Mr Chesterfield telling him there were white ant problems with the property and asking him to look at the property again.
e) He had a look at the property and recommended that Mr Chesterfield contact a person by the name of Chris Smith from Integrated Pest Management Systems. Mr Chesterfield did so, and the three men met on site.
f) He understood that Mr Chesterfield engaged Mr Smith to do some work with which he was not involved.
g) He later went to the property to see how things were progressing. He did this without being asked to do so. He described what took place in these terms:
In 2007, 8, 9, I would have went back. Whilst I was over at Paul’s place talking with Paul chatting about things I would have went and had – I had a look around the property, underneath the house. You couldn’t get much in through the roof cavity because of the design of the roof system plus insulation and other things up in there, but you could still get an idea of the higher parts. So basically I was doing an inspection just to see if there was any new white ant activity, but that’s pretty limited in that you can’t see through the Gyprock in the walls and you can only see what materials are exposed to what you can actually determine.[45]
When asked about the circumstances under which he came to “inspect” the work that had taken place the following exchange took place:
[HIS HONOUR:] Yes. Still not completely clear to me the circumstances under which you came to do that. Were you regularly seeing Mr Chesterfield for other reasons or something? Did you have other reasons to be at his house?---I’d done some minor work at Mr Chesterfield’s house. Mr Carlton and Mr Chesterfield were friends and Matt Carlton, I was driving him to work backwards and forwards because he didn’t have a licence. Sometimes we’d go over and see Paul. It wasn’t a regular basis. We might do it a few times a year. We went out to lunch. We just met at different occasions. It wasn’t a regular friendship mates type thing by far. It was just Matt and Paul knew each other and I was associated with Matt. So that occurred. Paul came over and helped me sheet a pergola out the back of my place. Mat Colson then finished the flashing and things on it. So there was minor stuff that we sort of engaged in, but the white ant I was interested in because I’ve done white ant work before. So I just wanted to, you know, just for my own experience, knowledge, just look at Paul’s issue. At that stage, Paul had informed me – requested me, or he had asked me to come and have a look at it, but he hadn’t formally engaged me to do work for him on it.[46]
He subsequently learnt that Mr Chesterfield had commenced litigation against the original pest inspection firm and had engaged Meyer Vandenberg Lawyers. He was contacted about meeting with the lawyers and did so at Mr Chesterfield’s house. He said that meeting was about what he had observed at the house.
He was also contacted by Mr Chesterfield who said that he wanted to engage him as a “building expert” or “building professional”. He later expressed the contact as being that Mr Chesterfield wanted to engage him “as a builder, building expert” because he might be required to go to court. He thought that contact was in 2010.
Mr Chesterfield wanted to get an idea of “cost and stuff”. He told Mr Chesterfield that it was hard to say because he didn’t know what he would be required to do, but said that he told Mr Chesterfield the following:
But I will tell you that if you get court experts in you’ll be getting charged from around a figure of $300 an hour.
He said that “Paul was fine with that” and that he “knew it was going to cost money”.
He subsequently met on site with the lawyers and what he described as “experts from the other side”. He said that there were three or perhaps four meetings on site.
He put into evidence three documents comprising an invoice for an amount of $8,400.00 referring to works occurring from 1 September 2011 to 13 September 2011, another invoice for an amount of $13,500.00 referring to works undertaken (without particularising when such works were undertaken), and a letter of demand dated 18 December 2011 which are Exhibits P15, P16, and P17 respectively.
He was unable to particularise his charges in Exhibit P16 because he did not record the actual times and dates for those attendances.[47]
He did say that he grouped the time spent in those attendances with the other work by way of time spent in writing the report and meetings with the solicitor and that it appeared under the heading “Write report on findings and met with Mr Chesterfield’s solicitor to discuss report and also insurance company’s report”.
In 2011, Mr Chesterfield approached him about an inspection of the property by, as I understood the evidence, the other party to the litigation. The inspection involved “removing sections of gyprock, cutting out parts here and there, having a look” to determine the extent of the white ant damage. For convenience I refer to this as the “work needed for the inspection”.
A price of $15,000.00 was referred to for that work by the other side and an objection was raised by Mr Chesterfield’s solicitor saying “how do we know [the work] is going to be done correctly? We’d prefer to use our own builder”. The other party agreed to Mr Chesterfield having his own builder do the work.
Mr Alcock says he told Mr Chesterfield that he would do the work needed for the inspection for that price of $15,000.00 and that would “include the time that I’ve spent in the initial inspection and report writing”. He said that arrangement was made in a meeting at the solicitors’ office on about 9 June 2011. He said that the persons present at that meeting were Mr Chesterfield, Ms Jaleh Johannessen, and him.[48]
When asked about the exchanges which took place which resulted in a deal being struck for the work, he said this:
The actual exchange as best recalled was Jareh [sic] raised that there had been correspondence between her and the defence lawyers and they wished – they wanted to do a preliminary investigation to the site to try and get some scope of what the white ant damage is to the property. I did not see the formal documents. They proposed to do certain inspections in certain areas, the main area being near the steel beam near the kitchen area – this wall. I don’t know if in that price they included report writing or anything else and stuff. I don’t know. I never was privileged to see the full scope of the documents. I never asked. They stated the other side was charging a figure of $15,000, from memory. They said they would – I could do that at that price because they have now made an arrangement that we would use – that we’d use their builder here, which was me and they proposed that to me.[49]
He said that at the meeting he agreed he would do the work for that price. The transcript at this point records the following:
[HIS HONOUR:] Tell me what was said then about the price?---Paul repeated what Jaleh said. Said, “Bob, you can do it – if you can do it for 15,000 grand, you know, we’re happy for you to do it.” I said, “For that price I’d do it,” but it seemed extravagant.[50]
The quotation appearing as it does in the transcript suggests that what was said by Mr Alcock was limited to the words, “For that price I’d do it”, and that what followed regarding the apparent extravagance of the price was by way of an opinion he formed but which was not expressed. Having regard, however, to the exchange which followed, I am satisfied that what Mr Alcock was intending by his testimony was that he also said to the others in the conversation at that meeting that the price seemed extravagant.
What followed was:
[HIS HONOUR:] If you can do it for 15,000, happy for you to do it and you said?---The price is extravagant but I’m not sure exactly what they’re doing, but for that that would include my previous work since Paul had engaged me. In other words, meeting with the other experts on site, the solicitors, things like that, also report writing, or any reports that I would submit to this particular.[51]
He went on to say that agreement for him to do the work was reached at the meeting and that he subsequently did the work over two days in June 2011.
He said that the work was not fully completed. He explained that by saying that he screwed the wall panel back in place but otherwise left the wall so that if further inspection was necessary it could be unscrewed. He did not refix architraves or repaint. He said that Mr Chesterfield did that work or arranged for someone else to do it at a later time.[52]
He said that he prepared a report following the inspection and met with Ms Johannessen to discuss it. He said he had been given reports prepared by other experts and he also discussed technical aspects of those reports with the lawyer.
He said that he reduced his invoice (Exhibit P16) from $15,000.00 to $13,500.00 to take into account that he had not finished all of the work.[53] He said that Mr Chesterfield had agreed to the work not being completed in case further inspection was necessary.[54] In the course of cross-examination, he explained how he had arrived at the reduction of $1,500.00.[55] He said that the invoice for $13,500.00 covered his work “outside the [conclave] and my appearances in court”.
Mr Alcock’s second invoice was for an amount of $8,400.00 (Exhibit P15). It is apparent that it is his claim for what is not included in Exhibit P16. The invoice is not fully itemised. It lists a description of various attendances with time spent on each, totalling 28 hours, and then a total figure of $8,400.00 arrived at by applying a charge of $300.00 per hour.
Mr Alcock’s testimony about how he arrived at the figure as to how much time he spent on the various court-related attendances was not wholly satisfactory. He had not kept detailed records of all the time spent on the items claimed.
He had kept no record of the time spent in the meeting with the “solicitor/barrister” which is the first item on the invoice, although it is not in dispute that some such meeting took place.
The next item in Exhibit P15 is a claim for “Redo quote as requested 2 hours”. After some initial confusion about what the item was intended to cover, Mr Alcock said that it was for work to redo a quote had prepared for use in evidence going to the cost of rectification work. The quote was redone after an expert’s conclave which addressed the approach to be taken to costing rectification work.[56]
The next item claimed on Exhibit P15 is for a conclave of experts on 1 September 2011 for which seven hours is claimed. He said that records were kept of that meeting but that he did not have them. He said that the conclave took one day. He identified the other experts who took part in it.[57]
The next item claimed is for a court appearance on 2 September 2011 for which four hours is claimed. He said the claim was for the period between when he arrived at court until he left, including time spent with Mr Chesterfield and the solicitor afterwards. He said that he did attend before the judge who addressed the experts on what was required of them.
The next item claimed is for another conclave on 9 September 2011 for which six hours is claimed. He said that the four experts again took part, one by telephone. He said that this was the conclave which addressed issues including the approach to be taken to costing of repair work.[58]
The next item claimed for appears in Exhibit P15 as “Review/sign report 1 hour”. The testimony given by Mr Alcock on the subject appears at pages 146 and 147 of the transcript of 28 February 2017. Mr Alcock suggested some possibilities but was unable to be certain of what was the basis for the time claimed.
The next item in Exhibit P15 is a claim for five hours shown as “Tuesday 13 September 2011 Court appearance”. Mr Alcock described the time as being both waiting time before court and the time spent in court. He went on to say it included time spent in reading of the reports done by himself and Mr Worthington.
When asked how he had arrived at a charge rate of $300.00 per hour, Mr Alcock said:
This was the rate – I spoke to Paul Chesterfield earlier when he wanted to engage me and said that I’d probably be required to appear in court and represent as an expert on different times and matters. That’s what I based on that. The other reason I based it on – that’s basically the main reason I based it on. The other one is I would say, but I think it would be just classed as hearsay, was a conversation that Paul was present with at Tarek El-Ansary’s office at the first concave [sic] meeting where Paul raised the question to the experts saying, “What do you charge,” where John Worthington answered first saying, “I charge $300 an hour.” Tarek El-Ansary answered. Andy Stodulka answered. I didn’t answer. Paul said, “So this is costing $1200 an hour.” So Paul knew the rates.[59]
The cross-examination of Mr Alcock about the Giralang Project commenced on 26 March 2018. Under cross-examination, he said that in 2011 his hourly charge rates were:
a) for carpentry work – $66.00;
for drainage work – $120.00;
for site inspections and advice on building or buying – $300.00;
for labouring assistance – $40.00; and
for supervising a job using building expertise – $150.00.
He denied that when spoken to by Mr Chesterfield about the issues he was having with the house he was in fact at the house on a social occasion.[60]
He agreed that the extent of the rectification work he did was the replacement of a wall stud.
He gave evidence about the relatively modest amounts of time which various aspects of the work took. He did say that he was assisted by another person so that the time referred to was time spent by two persons and also that Mr Chesterfield was present and time was spent in explaining to him the significance of some aspects of what was found during the inspection. In any event, he repeated the assertion made in his evidence in chief that the work claimed for in Exhibit P16 was done under a lump sum quote.[61] He conceded that he would not charge $300.00 per hour for removing gyprock and the like.[62]
It was put to Mr Alcock that there was never any agreement for the work to be done for $15,000.00. He denied that was the case. At a later point in the cross-examination, he gave more detailed testimony about the exchanges which took place with Mr Chesterfield and Ms Johannessen, which he says led to the fixed price agreement. It was in these terms:
[MR ALCOCK:] [T]he solicitor stated quite clearly, “The other side has proposed coming down and doing the inspection to determine some of the extent of the white ant damage. They're going to send their builder down from Sydney and the rate for him would be $25,000." They - Jaleh and Paul had stipulated that - or Jaleh, the solicitor, had stipulated they preferred to use a local builder. In this case they wanted to use me. She then asked me for a figure, and I said, "Look, based on what they're charging, $25,000, to write reports with minor investigation is very high." She said, "What would you charge," and I said, "I would charge as a contract rate, fixed rate, based on what you've proposed and this wall and looking at a couple of other sections only in small detail, $15,000 would cover it." They then agreed that they was far better and fairer rate and they had no problems then putting that back to the other side because it was $10,000 less than the other side's rate. So there was no actual discussion of detail of one power point, one bit of skirting or how much gyprock. It was a fixed contract rate to go and remove this section of wall, identify these other points and fix anything that was - I classed as unsafe, like as in I said to you before the truss not being supported by a stud. The steel beam was still in question. That was going to help relieve part of the issue on it and then do the associated reports and writings on my findings and reading other guys' reports and referring back to Australian standards (indistinct).[63]
Mr Alcock conceded that after the pest controller had been to the house, he (Mr Alcock) called in to see it on several occasions without being asked to do so. It was suggested to him that he did so “as a mate”. In response, Mr Alcock said this:
No, Paul hadn't asked me to do it. I didn't do it as a mate. I did it for my own knowledge and my own insurance. Because I recommended Chris Smith I just wanted to check things myself.[64]
As I understand the proposition which was put to Mr Alcock, it was that Mr Alcock’s ongoing involvement in Mr Chesterfield’s white ant problems at the house, including his involvement after the court case commenced, was on a gratuitous basis and because he (Mr Alcock) was interested to see how it was going. Mr Alcock responded to that proposition by saying, “No, of course not”.[65]
On the question of the rate claimed, Mr Alcock said:
Paul and I had spoke of rates, and I said, "It depends on what I'm instructed to do, but if I go to court as an expert, the going rate for an expert is $300." Paul asked me for those particular figures.
[MR BLANK:] I suggest you never had that conversation with my client?---Yes, I did, counsellor.
The only time there was a conversation like that was a long time later when you were speaking with his solicitor when you realised that the other experts were charging money and you wanted some, too?---No, counsellor. I know what the going rates are for experts at that time because I've charged those rates myself when I've done building inspections and I gave Paul that as general guidelines 300 depending on what the expertise is and what's required as the going rate.
You had a - - -?---I gave Paul those figures.[66]
Mr Alcock denied he knew at the time that the litigation was settled on the basis of a payment of $400,000.00 to Mr Chesterfield. He denied a proposition that he decided that “he wanted a piece of that because [he] felt [he] had helped him to get that result”.[67]
It was suggested to Mr Alcock that the time claimed by one of the other experts for the conclave on 9 September 2011 and the court appearance on 13 September 2011 was seven and a half hours. The relevant invoice became Exhibit D4. Mr Alcock’s Exhibit P15 claims eleven hours for those attendances. When asked to explain that difference, Mr Alcock said this:
[MR BLANK:] So you say that you spent 11 hours in the conclave and court appearance and he - which would explain why yours would be different from his?---I assume so, yes. I'd say for some reason he charged lesser hours or he wasn't there at the concave as long as I was, plus there was other reading of documents that was passed around. Maybe he didn't charge for those, whereas I've included them in there. Once we sit at the meeting and have - work it out, once those documents are redone and sent around I've then got to reread them, go through them, which I've charged for that time. So our hours could vary based on what he did and what I did.[68]
As to the claim for five hours for the court appearance on 13 September 2011, it was put to Mr Alcock that the time spent giving evidence was about three hours in total. He said that could have been the case but that his claim included time spent both waiting and “after court”. He said in particular that he had been asked by Ms Johannessen to be at the court at a particular time in the morning.
Mr Alcock denied a proposition that all experts were at the conclaves for the same period of time.[69]
I permitted some limited re-opening of Mr Alcock’s evidence-in-chief for further testimony to be given about some email exchanges with the solicitor’s office and what was described as a second supplementary inspection report. Mr Alcock had not been represented when he first gave evidence and I formed the view that the additional evidence-in-chief would assist me to better understand some of the other evidence.
I also permitted further cross-examination. In the course of that further cross-examination, Mr Alcock was referred to an email exchange with Ms Johannessen. The documents were put into evidence as Exhibit D5. The emails include one dated 16 September 2011 from the solicitor to Mr Alcock in which she says, “You cannot charge $300 per hour when your actual hourly fee is $88”.
It was put to Mr Alcock that the email had been written because he had never discussed with Mr Chesterfield that he would be charging $300.00 per hour. The exchange which took place was as follows:
[MR BLANK:] Because she's suggesting there your rate is $88 an hour so you can't charge this higher figure?---The reason she's putting $88 an hour is based on the cost estimates which are in these other documents, in the summary report where they wanted an estimating of cost of work done on Paul's house as a contractor, like a carpenter, painter or something, what their hourly rate would be. As previously said to the court, I have various hourly rates. In this case, $88 an hour is an accepted rate for a painter, carpenter to charge when doing the work at Paul's house in relation to the white ants.
What I'm - - -?---It's not the rate I charge as a building expert.[70]
One email from Mr Alcock to Ms Johannessen records, “Wish I had known this before because I would not have wasted my time”. The following exchange took place about that comment:
[MR BLANK:] You see that there's an email from you to Ms Johannessen, "Wish I had known this before because I would not have wasted my time"?---In that comment I meant if I had known I was only going to get paid $88 an hour when I thought we'd agreed 300 I wouldn't have worked for $88 an hour doing that work.
My point is why is it that that email doesn't say, "Hang on, we agreed the 300"?---I don't know. It was just the way I responded to it at the time, and as I - later on in the phone calls with them explained, "This is my invoices. If you choose not - that's what I'm putting in and you accept them or you don't accept them."
All right. So - - -?---That's what I thought or understood.[71]
Mr Alcock’s evidence on this aspect of his claim included the tender without objection of an expert report by Mr John Worthington, which was marked as Exhibit P21.
The evidence of Mr Chesterfield
I move to the second defendant’s evidence. The evidence-in-chief commenced on 20 September 2018. Mr Chesterfield largely agreed with the plaintiff in his testimony about the circumstances under which he first made contact with the plaintiff about the house, the discovery of termites and the introduction to Mr Smith.
His subsequent testimony can be summarised as follows:
a) After the commencement of court proceedings, the insurer sent in their expert, who was Mr John Worthington.[72]
b) He had conversations with the plaintiff on many occasions about what he described as the “termite battle”, but Mr Alcock was not “involved in a formal sense with the litigation”.
c) His solicitor suggested, about 6 months before the court hearing, that he ask Mr Alcock to write a report.
d) He asked Mr Alcock to put a report together for him. Mr Alcock agreed. In response to a question about whether there was discussion about Mr Alcock being paid to do that he responded, “No, I don’t think there was”.[73]
e) Mr Alcock prepared a report in that he wrote a report but the solicitor “prepared it” from his written notes. (I understood Mr Chesterfield to mean that the report had been written by Mr Alcock but typed and compiled in the solicitor’s office.)
f) Mr Alcock and Matthew Coulson had removed some walls. The work was done against the background of the insurer having suggested that only minor repair work was required. A figure of $20,000.00 for the repair work was mentioned.
g) Mr Worthington had already been to the house and had cut some holes in the walls.[74]
h) Mr Alcock said that his (that is, Mr Worthington’s) investigation was not thorough enough.
i) The section of wall removed was six metres in length. As I understood the evidence, what was meant was that the wall sheeting and architrave was removed and not the stud framing. That work took two hours.
j) Mr Alcock did not do any other work by way of cutting holes in other walls. Any other holes had already been cut.[75]
k) Mr Alcock also looked under the house for any evidence that termites had returned.
l) Other work done at the time included taping up the electrical wires exposed by the disconnection of three general power outlets and an antenna outlet when the wall sheeting was removed. Mr Chesterfield supplied the electrical tape.
m) The extent of the work was identified by Mr Chesterfield by reference to what is shown in the plaintiff’s report (Exhibit P18).[76]
n) In response to the reference in Mr Alcock’s invoice to “cutting sections out of other walls”, he said that the other walls had already been cut by Mr Worthington.
o) Mr Chesterfield did not know what was meant by the reference in the invoice to “met onsite and awaited until inspections were completed to close up areas and make good”.[77]
p) He subsequently reinstated the wall himself.
q) After preparation of the report, Mr Alcock continued to be involved as part of the court case.[78]
r) The second defendant subsequently attended a conclave of experts sometime after the commencement of the hearing. Also present was Mr Alcock and Messrs Tarek El-Ansary and Andrew Sedulka with a phone link up with John Worthington. That meeting took “a couple of hours”.
s) There was then another conclave after some time spent at court.[79] Mr Chesterfield attended along with all the experts.
t) He did not think that the first conclave was as long as the seven hours claimed by Mr Alcock, “but possibly it could have been”.[80]
u) As to the amount of time claimed by Mr Alcock for the court appearance, he said, “it possibly could have been” although I understood him to be referring to the time spent at court rather than the time spent in the witness box giving testimony.[81] Later he said that he did not think that Mr Alcock was “in court” for that long.[82]
v) He had a conversation with Mr Alcock at about this time about fees. He was not precise about when the conversation took place. The testimony was in these terms:
MR BLANK: Now, at the time that the conclave and the court was going on, by that point had you had a conversation with Mr Alcock about any fees for his time?---Yes, I did say to Bob at that point that I realised that he’s not at work and obviously he’s wasting his day with me, not of his own choice at this particular time. So I said to Bob, “Look, whatever one of these guys gets, I’ll give you the same.” And at that point it was never an amount, because I had no idea what I was going to be paying. And I remember we had a conversation about – somebody mentioned $300 or 400 an hour. I remember making a funny comment to Bob and Bob saying, “Well, at least I’m not charging you that.” That I remember.[83]
w) The court case was resolved in September 2011 without a finalised hearing on the basis of a compensation payment to Mr Chesterfield of $400,000.00.
x) In January 2012, he received a letter from Mr Alcock enclosing the two invoices which are the basis of the plaintiff’s claim in relation to the Giralang Project.
y) Before receiving that letter, he had exchanges with Ms Johannessen about Mr Alcock’s claim for payment.
z) He spoke to Mr Alcock about his invoices and Mr Alcock said to him, “You wouldn’t have won this matter without me. And that’s my – that’s what I’m charging you for the matter”.[84]
Mr Chesterfield was asked about what he had expected to pay Mr Alcock and the following exchange took place:
[MR BLANK:] Alright. Well, pausing there for a moment, you gave evidence a few minutes ago that you had told Mr Alcock that you would pay him, if I remember the words correctly, the amount that one of the other experts got paid?---Yes.
So how much did the other experts get paid?---I think the most – the most – I think they were very similar. About three and a half, three seven, something like that.
Alright. So how much were you going – how much did you understand then that you would be paying Mr Alcock?---Well, I assumed Bob would just get – well, I didn’t think that Bob was going to charge me anywhere near this. I must admit we never really had an agreement of what we were going to charge. I always had it in my mind I’d do the right thing and pay Bob whatever someone off the street would get paid. And in fact I was prepared to pay him six, to be honest. I said to Jaylee [sic], “I’m happy to pay him six. But I’ll need to know how he got to this.” And she was also under the impression that it was what was agreed.[85]
The cross-examination of Mr Chesterfield took place on 21 September 2018. The evidence given under cross-examination can be summarised as follows:
a) Mr Alcock was asked to put together something “to say what his expert opinion was based of [sic] John Worthington’s report and put a value next to it”.[86]
b) When asked whether Mr Alcock’s opinion was to be based just on Mr Worthington’s report or involved investigating the house he replied, “You’d have to ask Jaylee [sic], really”.[87]
c) He denied that a conversation with Mr Alcock about fees had taken place earlier than he had said in his evidence-in-chief.[88]
d) He denied that Mr Alcock had said at a meeting with Ms Johannessen that he would charge a fixed fee of $15,000.00.[89]
e) He denied that he was referring to any particular rate of payment when he said that he would pay Mr Alcock whatever was being paid to others.[90]
f) He did not dispute that some $2,360.00 had been paid to Chris Smith from Integrated Pest Management Systems for professional advice in connection with the litigation, or that the expert, Mr El-Ansari had been paid for seven and a half hours at the rate of $400.00 per hour also in connection with the litigation. He did say, however, that he believed that that fee included report preparation despite the invoice referring to only attendance at the experts’ conclave and court hearing.[91]
g) He denied a proposition that he had not been present for the experts’ conclave because the court had directed it to be between the experts only.[92]
h) He said that Mr Alcock was at court every day.[93] That led to the following exchange:
And he was there every day was he?---We were hanging out.
Right?---So he wasn’t there the whole time, he was on and off jobs, popping in to see how it was going. He was quite interested. He wasn’t there on an expert witness, if that’s what you’re trying to say. He was just there as my friend until he was called.
So he hasn’t charged any time for those days though, has he?---I didn’t charge him for his patio roof either, the work that I’ve done for him. No, we never charged each other.[94]
At a rather late stage in the cross-examination, questions were asked about some proceedings in the Australian Capital Territory Civil and Administrative Tribunal (ACAT). Mr Chesterfield was shown certain documents. He was asked if one was “your statement” and he responded, “I believe so”. It had been described by counsel as “Statement of respondents in the ACT Civil and Administrative Tribunal matter XD121182 and XD121423 between Robert Alcock and Paul Chesterfield”.
This part of the evidence was handled in a very unsatisfactory manner. The documents themselves were not put into evidence. It may be that such a course was entirely proper in the circumstances, but if the documents were not to be received in evidence their relevance should have been established by questioning of Mr Chesterfield.
In the course of exchanges about the evidence, Ms Petch referred to Mr Chesterfield having adopted his statement. That may well be an accurate description of the effect of his testimony, but I was left to infer that the ACAT proceedings were proceedings taken by Mr Alcock in that tribunal against Mr Chesterfield claiming payment for the same fees which are (in part) the subject of the claim before me. In the absence of such an inference the questions and answers given about the contents of certain paragraphs of the statement are meaningless.
In any event, I am prepared to draw the inference to which I have referred. I do so against that background that, in the course of exchanges with counsel, I pointed out the lack of context (and what I would be required to infer) without objection from counsel for the defendants.
Even doing so, it appears that the most which can be said of the evidence given at that point in the proceedings is that it constitutes an acknowledgement by Mr Chesterfield that, in documents intended for use in other proceedings about the same claim for fees, he had said, to paraphrase:
a) that Mr Alcock was not asked to give evidence as an expert;
b) he had accepted that Mr Alcock was entitled to be paid for forty-four hours for what is referred to in the statement as “his time in relation to the above work”, but is otherwise unexplained;[95]
c) he believed that $100.00 per hour was a reasonable rate for payment of Mr Alcock; and
d) he had accepted that Mr Alcock had “attended the experts’ conclave directed by the Supreme Court on 1, 2, and 9 September 2011 for a total of 16 hours and appeared before the court on 13 September for a total of 4.5 hours”.[96]
The re-examination of Mr Chesterfield took place on the final day of the hearing. The Giralang Project was not referred to in re-examination.
There were two invoices issued by the plaintiff and it is convenient to look at his claim in the same way.
The claim for monies owing under the invoice marked as Exhibit P16
I deal first with the plaintiff’s claim for the monies said to be owing under the first invoice for $13,500.00.
The plaintiff says that the work done by him was for an agreed fixed price of $15,000.00 but that he reduced his bill to $13,500.00 because he did not complete all the work.
I have some difficulty in following the logic behind what Alcock says were the circumstances leading up to the agreement for him to do the work. Mr Alcock’s evidence-in-chief was that, at a meeting with Mr Chesterfield and his lawyer, he was told that the other side wanted to do a preliminary investigation of the property “to try to get some scope” of the damage, and that they proposed to do certain inspections in certain areas. That a defendant would wish to do so is unsurprising. As I understood the plaintiff’s testimony, it was that Mr Chesterfield was concerned about the quality of the invasive pre-inspection work required: “how do we know the work is going to be done properly?”. It is said to be that concern which gave rise to the plaintiff doing the work for what he says he understood to be that amount which the insurer was otherwise intending to pay its expert.
Whilst the insurer may well have agreed to some person not engaged by it doing preparatory work by way of, for example, cutting holes or removing walls in preparation for an inspection by its own expert, it is implausible that the insurer would have agreed to some person engaged by its opponent in the litigation – that is, Mr Chesterfield - conducting an inspection or writing a report for the insurer’s use.
Mr Alcock in his evidence-in-chief said he thought he had been told the insurer was intending to pay $15,000.00 for the work. Under cross-examination, he referred to having been told the figure was $25,000.00. It is apparent that Mr Alcock was not privy to the exchanges between the lawyer and the insurer and so was unable to say precisely what was the work for which the insurer had intended to pay either $25,000.00 or $15,000.00. If it was limited to the modest work which Mr Alcock went on to carry out by way of removing the wall then even if the figure was $15,000.00 and not $25,000.00 it would be surprising that the insurer would have been intending to pay its contractor that amount for such modest work. It would be more remarkable still if the figure was $25,000.00.
If, on the other hand, the figure of $15,000.00 (or $25,000.00) was intended to also include report writing by some expert for the insurer, then it cannot be that case that Mr Alcock was doing that same work for a lesser amount because, as I have said, the insurer would have insisted upon having its own expert (and not a friend of the plaintiff in that dispute) prepare a report for its use.
There was also evidence from Mr Chesterfield that other holes had already been cut into the walls by Mr Worthington at the time that Mr Alcock did the work by way of removing the wall. I infer that to have been for the purpose of inspection and reporting to the insurer. That evidence was not challenged in cross-examination. The evidence suggests that at least some of whatever invasive pre-inspection work was required had already been performed, and again calls into question the logic of Mr Alcock’s suggestion that he was engaged by Mr Chesterfield on a fixed price basis to do the same work which was otherwise to be done on behalf of the insurer on a fixed price basis.
Against the background of the above, Mr Alcock’s explanation of how and why a fixed price was agreed to by Mr Chesterfield is not rational. That leads me to reject his testimony that he was engaged to do the work which is the subject of his invoice that is Exhibit P16 on a fixed price basis.
No quantum meruit claim is pressed in relation to the work the subject of what was asserted to be the fixed price contract.[97]
The claim for monies owing for under the invoice for the provision of expert services
I turn to deal with that part of the plaintiff’s claim which is based upon the second invoice. I do not accept that there was any agreement, arrangement or understanding that the work done by the plaintiff would not be charged for. Despite what was the apparently friendly relationship between the parties at the time, the extent and importance of what was being asked of Mr Alcock makes it inherently unlikely that he would have been asked, or that he would have agreed to perform, the relevant services for free.
I am satisfied that Mr Alcock was engaged to do the work which is the subject of the second invoice but not on the basis that it would not be charged for.
As to the basis upon which that work was to be charged for, the plaintiff says that there was an express discussion about a fee being charged at the rate of $300.00 per hour. I find that agreement to that effect existed. My conclusion is reinforced by the evidence of Mr Chesterfield’s acknowledgement that some payment would be made to Mr Alcock.
As an aside, having regard to the nature of the work and Mr Alcock’s testimony as to his usual rates and to the testimony of Mr Worthington, the rate of $300.00 per hour for the claimed for work appears reasonable, and it is not implausible that Mr Chesterfield would have agreed to it.
Even if I am wrong about the rate for payment having been agreed, that would not in my view change the end result. Having reached a conclusion that there was an agreement that the plaintiff would be remunerated for the services he was to provide, the contract should not fail because of the lack of agreement as to the specific rate. In BJ Aviation Ltd v Pool Aviation Ltd [2002] EWCA Civ 163; 2 P & CR 25, his Honour Chadwick LJ said at [23]:
where the court is satisfied that the parties intended that their bargain should be enforceable, it will strive to give effect to that intention by construing the words which they have used in a way which does not leave the matter to be agreed in the future incapable of being determined in the absence of future agreement. In order to achieve that result the court may feel able to imply a term in the original bargain that the price or rent, or other matter to be agreed, shall be a ‘‘fair’’ price, or a ‘‘market’’ price, or a ‘‘reasonable’’ price; or by quantifying whatever matter it is that has to be agreed by some equivalent epithet.
It has been observed by one author that “[t]he implication of a promise to pay a reasonable price is commonplace if services have been performed or goods delivered”.[98] Indeed:
[T]he further the parties have gone in performance the less likely it is that an agreement will fail for incompleteness. Accordingly, an agreement apparently incomplete in its inception may be found to be binding if it has been largely performed by one or both parties … A court is also more likely to imply terms in order to avoid the injustice that might arise if a party who had performed was unable to enforce the agreement against the other party. For example, under the sale of goods legislation a buyer must pay a reasonable price for goods accepted by the buyer. More generally, in F & G Sykes (Wessex) Ltd v Fine Fare Ltd Lord Denning MR noted that, in a commercial agreement, ‘the further the parties have go on with their contract, the more ready are the courts to imply any reasonable term so as to give effect to their intentions’.[99]
As already mentioned above, I am satisfied that a rate of $300.00 per hour for the work to be performed appears reasonable.
What next falls for determination is the amount of time for which Mr Alcock is entitled to claim payment at that rate. His testimony on the time taken to do what is claimed for was deficient in several ways. He had not maintained the records of the time spent which would normally be expected of an expert working on a time cost basis.
In addition, Mr Alcock’s claim also included a charge for waiting time at court. He did not give evidence that his exchange with Mr Chesterfield about fees included an express term that waiting time would be charged for. On the limited evidence available to me I am not persuaded that the proper construction of the agreement to do the work claimed for extends to payment for waiting time or that such a term can be implied.
As the plaintiff, Mr Alcock bears the onus of proving the quantum of his claim. It is apparent that he did some work, but I place little reliance on Mr Alcock’s testimony about the time spent in the court room and in the experts’ conclave. He had not kept records and was relying upon his memory of events many years after they took place.
Doing the best I can on the state of the evidence before me, I find that Mr Alcock is entitled to payment at the rate of $300.00 per hour for a total of 22 hours of the work which is the subject of the second invoice. The product of that calculation is $6,600.00. I allow interest at the prescribed rate for the period from 18 December 2011 to the date of judgment in an amount of $3,423.50.
Orders
The orders I make are as follows:
a) I give judgment for the plaintiff against the second defendant in an amount of $10,023.50, including interest of $3,423.50.
On the plaintiff’s claim against the first defendant, I give judgment for the first defendant.
I will hear the parties on the question of costs.
| |I certify that the preceding two hundred and two [202] numbered |
| |paragraphs are a true copy of the Reasons for Judgment of his Honour |
| |Magistrate Morrison |
| | |
| |Associate: Angus Brown |
| |Date: 1 May 2020 |
-----------------------
[1] Plaintiff’s written submissions, filed 12 June 2019, 4.
[2] Carlisle v Filaria Pty Ltd [2002] ACTSC 33, [30] (Crispin J).
[3] Carlisle v Filaria Pty Ltd [2002] ACTSC 33, [30] (Crispin J).
[4] Plaintiff’s written submissions, filed 12 June 2019, 7.
[5] Hawkins v Clayton [1988] HCA 15; 164 CLR 539, 561 (Brennan J), 587-8 (Deane J, with whom Mason CJ and Wilson J relevantly agreed), 599 (Gaudron J).
[6] Wardley Australia Limited v Western Australia [1992] HCA 55; 175 CLR 514, 532 (Mason CJ, Dawson, Gaudron and McHugh JJ).
[7] The decision in Alucraft Pty Ltd (in liq) v Grocon Ltd [1996] 2 VR 386 leaves open the possibility of a claim by a contractor against a subcontractor for defective work in some relevant circumstances, despite the fact that it was concluded in that case that the loss did not arise “in relation to” latent damage.
[8] Defendants’ written submissions, filed 13 August 2020, [38].
[9] Brisbane South Regional Health Authority v Taylor [1996] HCA 25; 186 CLR 541, 556.
[10] See Brisbane South Regional Health Authority v Taylor [1996] HCA 25; 186 CLR 541, 554 (McHugh J).
[11] Plaintiff’s written submissions, filed 12 June 2019, 13.
[12] Defendants’ written submissions, filed 13 August 2019, 12.
[13] Transcript 26 March 2018, 63.25-26.
[14] Transcript 26 March 2018, 63.41-43.
[15] Transcript 26 March 2018, 64.9-10.
[16] Transcript 26 March 2018, 64.37 – 65.4.
[17] Transcript 26 March 2018, 65.8-17.
[18] Transcript 26 March 2018, 65.21-22.
[19] Transcript 26 March 2018, 67.5-6.
[20] Transcript 26 March 2018, 67.34-36.
[21] Transcript 26 March 2018, 67.38-43.
[22] Transcript 26 March 2018, 70.39-42.
[23] Transcript 26 March 2018, 71.8-12.
[24] Transcript 26 March 2018, 72.41-42.
[25] Transcript 26 March 2018, 74.9-14.
[26] Transcript 26 March 2018, 76.22.
[27] Transcript 27 March 2018, 80.44 – 81.2
[28] Transcript 27 March 2018, 86.31. There was a slight deviation in the evidence at this point. The plaintiff referred, during the course of his explanation about the hours spent on the job, that the reason for his overseeing the work was to ensure that the workers wearing a “React t-shirt” were not working next to the workers removing asbestos. In the course of an exchange with counsel for the defendants, the plaintiff accepted that he did not see any workers on site wearing a “React shirt”, but that he was advised that prior to the site being closed down, a “guy in the React shirt [was] working on the roof next to the asbestos guys”: Transcript 27 March 2018, 87.20-21.
[29] Transcript 27 March 2018, 89.30 – 90.6.
[30] Transcript 20 September 2018, 78.33.
[31] Transcript 20 September 2018, 78.38 – 79.3.
[32] Transcript 20 September 2018, 79.36-40.
[33] Transcript 20 September 2018, 79.43-44.
[34] Transcript 20 September 2018, 80.2-6.
[35] Transcript 20 September 2018, 98.20-23.
[36] Transcript 20 September 2018, 98.29-31.
[37] Transcript 20 September 2018, 99.8-25.
[38] Transcript 27 March 2018, 89.
[39] Transcript 26 March 2018, 71.
[40] Transcript 26 March 2018, 76.
[41] Transcript 26 March 2018, 65.
[42] Transcript 26 March 2018, 65.
[43] Transcript 27 March 2018, 80-83.
[44] Transcript 27 March 2018, 93-94.
[45] Transcript 28 February 2017, 119.6-14.
[46] Transcript 28 February 2017, 119.19-35.
[47] Transcript 28 February 2017, 126.
[48] Transcript 28 February 2017, 129.
[49] Transcript 28 February 2017, 130.29-41.
[50] Transcript 28 February 2017, 131.3-6.
[51] Transcript 28 February 2017, 131.
[52] Transcript 28 February 2017, 134.
[53] Transcript 28 February 2017, 137.
[54] Transcript 28 February 2017, 138.
[55] Transcript 26 March 2018, 40.
[56] Transcript 28 February 2017, 143-145.
[57] Transcript 28 February 2017, 142.
[58] Transcript 28 February 2017, 143.
[59] Transcript 28 February 2017, 148.10-20.
[60] Transcript 26 March 2018, 17.
[61] Transcript 26 March 2018, 21.
[62] Transcript 26 March 2018, 28.
[63] Transcript 26 March 2018, 28.42 – 29.18.
[64] Transcript 26 March 2018, 25.36-38.
[65] Transcript 26 March 2018, 25-26.
[66] Transcript 26 March 2018, 26.12-28
[67] Transcript 26 March 2018, 33.
[68] Transcript 26 March 2018, 37.14-22.
[69] Transcript 26 March 2018, 39.
[70] Transcript 26 March 2018, 57.4-13.
[71] Transcript 26 March 2018, 58.39 – 59.6
[72] Transcript 20 September 2018, 80.
[73] Transcript 20 September 2018, 83.
[74] Transcript 20 September 2018, 84.
[75] Transcript 20 September 2018, 84.
[76] Transcript 20 September 2018, 86.
[77] Transcript 20 September 2018, 97.
[78] Transcript 20 September 2018, 90.
[79] Transcript 20 September 2018, 92.
[80] Transcript 20 September 2018, 96.
[81] Transcript 20 September 2018, 96.
[82] Transcript 20 September 2018, 96.
[83] Transcript 20 September 2018, 92.44 – 93.6.
[84] Transcript 20 September 2018, 94.
[85] Transcript 20 September 2018, 94.38 – 95.7.
[86] Transcript 21 September 2018, 222.
[87] Transcript 21 September 2018, 223.
[88] Transcript 21 September 2018, 223.
[89] Transcript 21 September 2018, 225.
[90] Transcript 21 September 2018, 227.
[91] Transcript 21 September 2018, 228.
[92] Transcript 21 September 2018, 244.
[93] Transcript 21 September 2018, 235.
[94] Transcript 21 September 2018, 235.15-24.
[95] Transcript 21 September 2018, 239.
[96] Transcript 21 September 2018, 240.
[97] Plaintiff’s written submissions, filed 12 June 2019, 28.
[98] J W Carter, Contract Law in Australia (LexisNexis Butterworths, 7th ed, 2018), 96.
[99] J W Carter, Contract Law in Australia (LexisNexis Butterworths, 7th ed, 2018), 97.
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