A & A Martins Pty Ltd v Liu

• Jurisdiction: Australian Capital Territory
• Court: Supreme Court of ACT
• Judge: McWilliam AsJ
• Judgment Date: 06 March 2018
• Docket Number: File Number: SC 235 of 2017
• Date: 06 March 2018

[2018] ACTSC 102

SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

Before:

McWilliam AsJ

File Number: SC 235 of 2017

A & A Martins Pty Limited (ACN 12 072 578 271) trading as A & A Martins Constructions; A & A Constructions Pty Limited; and Martins Building Group

(Plaintiff)

and

Bin Liu

(First Defendant)

Chen Huan Li

(Second Defendant)

Representation:

Counsel

Self-represented (Plaintiff)

Self-represented (First Defendant)

Self-represented (Second Defendant)

Cases Cited:

Australia and New Zealand Banking Group Ltd v Westpac Banking Corp (1988) 164 CLR 662

Australian Financial Services and Leasing Pty Ltd v Hills Industries Ltd [2014] HCA 14 ; 253 CLR 560

Batchelor v Burke (1981) 148 CLR 448

Beagle v Australian Capital Territory and Southern New South Wales Rugby Union Limited [2017] ACTCA 29

BP Exploration Co (Libya) Ltd v Hunt (No 2) [1979] 1 WLR 783

Champerslife Pty Ltd v Manojlovski & Anor [2010] NSWCA 33 ; 75 NSWLR 245

David Securities Pty Ltd v Commonwealth Bank of Australia (1992) 175 CLR 353

Equuscorp Pty Ltd & Anor v Acehand Pty Ltd & Ors [2010] VSC 89

Habib v Radio 2UE Sydney Pty Ltd [2009] NSWCA 231

Helmhout v Apostoloff & Ors ; Dempsey-Fiddes v Commonwealth of Australia & Anor; Reynders v Commonwealth of Australia & Anor [2011] ACTSC 2

Lampson (Australia) Pty Ltd v Fortescue Metals Group Ltd [No 3] [2014] WASC 162

Lumbers v W Cook Builders Pty Ltd (in Liquidation) [2008] HCA 27 ; 232 CLR 635

Maples Winterview Pty Ltd v Liu and Li [2015] ACTSC 58

Meriton Apartments Pty Ltd v Industrial Court of New South Wales [2009] NSWCA 434 ; 263 ALR 556

Muschinski v Dodds (1985) 160 CLR 583

Notaras & Anor v St George Bank Ltd & Ors [2005] ACTSC 5 ; 157 ACTR 1

Pavey & Matthews Pty Ltd v Paul (1987) 162 CLR 221

Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR

Roxborough v Rothmans of Pall Mall [2001] HCA 68 ; 208 CLR 516

Legislation Cited:

Limitation Act 1985 (ACT) s 11

Court Procedures Rules 2006 (ACT) rr 30, 501,1619, Sch 2

Texts Cited:

K Mason, J W Carter and G J Tolhurst, Mason & Carter's Restitution Law in Australia (LexisNexis Butterworth, 3 ^rd ed, 2016)

RESTITUTION — QUANTUM MERUIT — unjust enrichment — where plaintiff substantially constructed a house for the defendants — where defendants refused to pay for work completed on the basis that the contract was signed with a different corporate entity — whether defendants knew or ought to have known that services and goods were being performed or supplied by the plaintiff.

Decision

• 1. The name of the plaintiff be amended to A & A Martins Pty Limited (ACN 072 578 271) trading as A&A Martins Constructions; A & A Constructions; and Martins Building Group.

• 2. Judgment for the plaintiff in the sum of $198,484.20.

• 3. The defendants are to pay interest on the judgment sum of $52,492.28.

• 4. The defendants are to pay the plaintiff's costs.

Introduction

1 The dispute before the Court concerns a residential property in Bonner in the Australian Capital Territory ( property). The plaintiff is a construction company. The defendants are husband and wife and the owners of the property. Stripped of the detail, the plaintiff's claim is that it substantially built a residential dwelling on the property for the defendants between July 2011 and August 2012 and has not been paid for most of that work, including for all the construction materials that the plaintiff supplied to the defendants.

2 The defendants' case is that a house was substantially built, but by a different corporate entity to the plaintiff, and that the matter has already been decided, through the decision of Mossop AsJ (as his Honour then was) in Maples Winterview Pty Ltd v Liu and Li [2015] ACTSC 58 ( Maples Winterview).

3 The defendants contend that the reason they have not paid for the construction of the dwelling arises from what they say are major building defects regarding the insulation for the slab, which may need to be reconstructed, with all the building structure above the slab possibly needing to be removed. The defendants contend the plaintiff was a subcontractor and that they had no obligation of payment to the plaintiff. Further, in their Defence filed 5 October 2017, the defendants argue that the first time they became aware of the plaintiff's involvement was when the decision of Maples Winterview was handed down.

4 At the commencement of the hearing, the plaintiff was granted leave to be represented by Ms Maria de Lurdes Martins, one of its company directors pursuant to r 30(4) of the Court Procedures Rules 2006 (ACT) ( Rules), for reasons which I gave at the time, having regard to the considerations set out in Helmhout v Apostoloff & Ors; Dempsey-Fiddes v Commonwealth of Australia & Anor; Reynders v Commonwealth of Australia & Anor [2011] ACTSC 2, and in particular at [45].

5 The defendants were also self-represented and it was apparent that English was not their first language. This, combined with the lack of anyone with legal expertise, has caused difficulties with the way the case was pleaded, defended, presented and argued.

The proper plaintiff

6 One of those difficulties is that the Originating Claim describes the plaintiff as A & A Martins Pty Limited (ACN 12 072 578 271) t/a A & A Martins Constructions; A & A Constructions Pty Limited; and Martins Building Group. This appeared to be a mixture of separate corporate entities, and business names which do not have the ability to bring proceedings in their own right.

7 Raising this with the plaintiff brought confusion as to whether only one entity was bringing proceedings, trading under a number of different business names, or whether A & A Constructions Pty Limited was also intended to be a plaintiff. As the claim in these proceedings focuses on precisely who did the work for the defendants, it was important to understand who it is that makes the claim.

8 Accordingly, the plaintiff was given the opportunity to file further evidence by way of an ASIC search as to the proper plaintiff, which establishes that the relevant legal entity with the ability to sue is A & A Martins Pty Limited (ACN 072 578 271), and that one of the names under which it trades is A & A Martins Constructions. Its ABN is 12 072 578 271.

9 The further evidence confirmed there is an error in how the plaintiff was described in the Originating Claim, with the inclusion of the words ‘Pty Limited’ after A & A Constructions as one of the trading names. Pursuant to r 501 of the Rules, the plaintiff's name will be amended to read A & A Martins Pty Limited (ACN 072 578 271) trading as A & A Martins Constructions; A & A Constructions; and Martins Building Group.

Nature of claim

10 The basis of the claim is described as quantum meruit, resulting in an alleged unjust enrichment, being that the defendants now have the benefit of a house that was substantially built by the plaintiff, using materials purchased by the plaintiff, and yet they have not paid the plaintiff. The plaintiff claims $251,974.14 plus interest on that sum in the amount $80,577.27.

11 The plaintiff does not make any claim in contract or for any builder's fee or labour costs by it directly. The reason for that will be apparent from the discussion of the earlier decision of Maples Winterview below. The claim is limited to the expenses that the plaintiff incurred in building the property, examples being the buying of the timber, tiles, and bathroom fittings, or paying contractors for services, such as doors to be fitted, roofing to be completed, and electrical and plumbing work to be undertaken.

12 Where goods are supplied as opposed to services, historically that aspect of the claim has been characterised as one of quantum valebat (or valebant) meaning ‘as much as it was worth’: BP Exploration Co (Libya) Ltd v Hunt (No 2) [1979] 1 WLR 783 at 805. See also the discussion in Pavey & Matthews Pty Ltd v Paul (1987) 162 CLR 221 ( Pavey & Matthews) at 251 per Deane J.

13 These forms of action have gone since Pavey & Matthews (discussed further below), based as they were in quasi-contract, with the right to recover for such a claim now depending on a claim to restitution, based on unjust enrichment. The common feature of claims for quantum meruit and quantum valebat is the recovery of a reasonable sum of money representing the value of work, services, or goods requested and/or accepted by the defendants: K Mason, J W Carter and G J Tolhurst, Mason & Carter's Restitution Law in Australia (LexisNexis Butterworth, 3 ^rd ed, 2016) pp 15, 19–20, 83.

14 Accordingly, although a claim of quantum meruit was pleaded, I have taken the nature of the claim to be one seeking restitution based on unjust enrichment, in the form of payment of a fair and reasonable sum for services rendered or goods supplied to the defendants.

Background to the proceedings

15 The dispute between the parties takes place in the context of other litigation to which each party referred during the hearing. In 2015, an entity related to the present plaintiff brought proceedings against the defendants on the basis of breach of contract: see Maples Winterview. The proceedings before Mossop AsJ dealt with the same building project on the property as that now the subject of these proceedings. Maples Winterview Pty Ltd ( Maples) had sought to enforce progress payment claims against the defendants on the basis that it was the contracting party with the defendants and had carried out work for them. The plaintiff was not a party to those proceedings.

16 Mossop AsJ found that Maples was not entitled to recovery of any moneys because it had not completed the stage of the build that would have entitled it to a progress payment. Specifically, Maples had not constructed the slab on which the house was built in accordance with the...