Trubnik v John H Walker Pty Ltd [2001] FCA 319

FEDERAL COURT OF AUSTRALIA

Trubnik v John H Walker Pty Ltd [2001] FCA 319 SIMON TRUBNIK v JOHN H WALKER PTY LTD (ACN 006 272 804) V 7011 of 2001

GRAY J 19 MARCH 2001 MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY V 7011 OF 2001

BETWEEN: SIMON TRUBNIK

APPLICANT

AND: JOHN H WALKER PTY LTD (ACN 006 272 804)

RESPONDENT

JUDGE: GRAY J

DATE OF ORDER: 19 MARCH 2001

WHERE MADE: MELBOURNE

THE COURT ORDERS THAT: 1. The application to set aside the bankruptcy notice be dismissed. 2. The applicant pay the costs of the respondent, John H Walker Pty Ltd, of the application. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY V 7011 OF 2001

BETWEEN: SIMON TRUBNIK

APPLICANT

AND: JOHN H WALKER PTY LTD (ACN 006 272 804)

RESPONDENT

JUDGE: GRAY J

DATE: 19 MARCH 2001

PLACE: MELBOURNE

REASONS FOR JUDGMENT 1 By application filed on 29 January 2001, the applicant has applied to set aside a bankruptcy notice obtained by a judgment creditor, John H Walker Pty Ltd. The bankruptcy notice is based on a judgment of the Magistrates Court of Victoria at Melbourne on 26 April 2000. The judgment was that the applicant pay John H Walker Pty Ltd the sum of $950, together with costs of $2440 and interest of $115. The applicant claims to have a counterclaim, set-off or cross-demand equal to or exceeding the amount of the judgment debt, being a counter-claim, set-off or cross-demand that he could not have set up in the proceeding in which the judgment was obtained. 2 The matter arises in this way. John H Walker Pty Ltd sued the applicant for fees alleged to be owing for accounting services performed for the applicant or the applicant's company. The applicant defended the proceedings but without legal representation. He wrote a letter dated 14 October 1999 to the Magistrates Court, in which he said to the court the following: "Without prejudice, Simon L. Trubnik (Director) of Eastern Profits PTY LTD (ACN 007 268 591) wish to lodge a legal complaint and take legal action of same against John H. Walker PTY LTD (ACN 006 272 804) on the grounds: a. Overcharging, for the work carried out. b. Harassment and waste of companies (sic) valuable time. c. Recovery of $300.00 over payed (sic) to J. H. Walker P/L for the work carried out." 3 As I have said, Mr Trubnik defended the proceeding. In the result, John H Walker Pty Ltd was not successful to the full extent of its claim, but recovered only $950. Consequent upon the judgment of the Magistrates Court, the applicant appears to have done a calculation in respect of amounts for which he had been charged in previous years for accounting work and to have calculated that Mr Walker, an accountant, had overcharged him. The calculation was based on the magistrate's findings, and on a comparison of charging rates per hour and numbers of hours taken by another accountant in the performance of work, which the applicant says was comparable to the work performed by Mr Walker in the provision of those accounting services. The overcharging claimed related to the years ended 1989, 1990, 1991, 1992 and 1993. The applicant claims that the total of the overcharging between 1989 and 1993 is $6450, an amount which does exceed the amount of the judgment debt. 4 John H Walker Pty Ltd has appeared by its solicitor to oppose the application. 5 It seems to me that there are three reasons why it must be said that the applicant does not have a counterclaim, set-off or cross-demand that he could not have set up in the proceeding which gave rise to the judgment debt. 6 The first reason relates to the application of s 5 of the Limitation of Actions Act 1958 (Vic). That provision creates a limitation period of six years in respect of claims of this nature. The period of six years had elapsed prior to the Magistrates Court proceeding with respect to a number of the years for which accounting work had been performed. To the extent to which it had not so elapsed it would have been open to the applicant to set up a counterclaim in that proceeding in respect of any overcharging. Apart from attempting to acquaint the court with the issue of overcharging, by means of the letter to which I have referred, the applicant appears to have taken no step to set up a counterclaim. Certainly no such counterclaim was in issue in the Magistrates Court. No proceeding has been commenced in any court in respect of the alleged overcharging. The last of the accounts for the accounting work allegedly overcharged was rendered in 1994 and paid in that year. It seems to me therefore that, at present, the limitation period in respect of any claim for overcharging that the applicant may have had has expired and that the applicant no longer has a counterclaim set-off or cross-demand in respect of that alleged overcharging. 7 The second reason for the absence of a counterclaim set-off or cross-demand appears to me to be the problem of identities. As I have said, John H Walker Pty Ltd is the judgment creditor and has obtained the bankruptcy notice. It appears that for the years in respect of which he alleges that he was overcharged, the applicant engaged a Mr John Walker to do his accounting work. For part of that time, Mr Walker was a principal in an accounting business conducted by a company called Nugara Walker & Partners Pty Ltd. For another part of that time, he appears to have been an employee of another firm of accountants. If the applicant had a claim for overcharging against anyone, it appears that it would not have been against John H Walker Pty Ltd in respect of the accounting work for the years 1989 to 1993. 8 The third reason why I am not satisfied that the applicant has a counterclaim, set-off or cross-demand against John H Walker Pty Ltd is the process by which he has calculated the alleged overcharging. As I have said, the calculation was made by reference to a comparison of hourly rates and hours worked by another accountant in respect of work which the applicant considers to have been identical to the work undertaken by Mr Walker in the past. I am by no means satisfied that the assumption that the work is identical is a sustainable assumption. What the applicant has done is to make a retrospective calculation as to what he thinks it would have been appropriate to be charged for work during the period 1989 to 1993. There seems to me to be no clear basis on which the applicant can sustain such a calculation. It is true that he was partially successful in defending the claim by John H Walker Pty Ltd in the Magistrates Court. There is perhaps something to be said for the proposition that the applicant is entitled to be suspicious that he was overcharged in previous years. It is necessary for him, however, to establish that he was overcharged by a particular amount or