TAYLOR v LOGWON PTY LTD SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL PRIESTLEY, HANDLEY and POWELL JJA 9 February 1994, 9 February 1994 [1994] NSWCA 305 RIGHT TO CROSS EXAMINE — denial of right to cross examine on documentation — procedural fairness. STATED CASE PROCEDURE — failure to utilise procedure properly — limited nature of appeal from a Local Court under the Local Court (Civil Claims) Act 1970 — the appellant (plaintiff), a builder, succeeded in a Local Court action in which he sought payment for materials provided and work performed on the respondent's (defendant's) premises. In response to a case stated by the Magistrate, Ireland J upheld an appeal of the defendant, on the ground that what the Magistrate had done had the effect of closing off cross examination of the plaintiff on documentation upon which the defendant's representative wished to cross examine. — Held: (1) If counsel is denied the right to cross examine then there is a great deal to say for the conclusion that there has been a denial of procedural fairness of a significant kind. However, a reading of the transcript is sufficient to demonstrate that there was no denial of procedural fairness in what occurred. (2) (Obiter) It is not necessary to deal with the way in which the case stated procedure was used but this should not be taken as indicating approval of the way in which procedural matters were handled. (Powell J) Having regard to the limited nature of the appeal from a Local Court (Civil Claims) Act 1970 and the form of case which was stated by the Magistrate, it was not open to the respondent to advance before Ireland J the arguments which were advanced, or to take the course which he has taken. Even if that were not so, there was no substance in the claim of denial of procedural fairness. Priestley JA Before the court is an appeal from a judgment of Ireland J. His Honour's judgment was given in response to a case stated by a Magistrate following a decision by her in favour of the plaintiff, in the Local Court. The stated case is before us. In the stated case under the heading "Determination" the Magistrate said the defendant was liable for work done and materials provided by the plaintiff upon premises owned by the defendant together with some additional factual material. Also under the heading "Determination", the Magistrate said that as to quantum, on the best evidence available, not effectively disturbed by the defendant's case, the plaintiff was, on the balance of probabilities, entitled to the amount of the claim. The Magistrate then set out the facts upon which she had come to those determinations. They included the fact that the plaintiff performed work for the defendant, the plaintiff did not quote for the job, and was not required to, the defendant obtained the benefit of the works, the defendant accepted the indebtedness and did not dispute quantum at meetings with the plaintiff, and that the plaintiff gave evidence (which the Magistrate accepted) that the amount claimed was calculated on a basis of the disbursements of materials and man hours worked charged out at the lower end of the then current wages which contractors charged out their employees time. The Magistrate indicated, in stating this fact, that she had 2 UNREPORTED JUDGMENTS accepted the plaintiffs evidence and did not find that evidence given by a witness for the defendant damaged the plaintiff's claim. Under the heading "Ground of Determination" the Magistrate said that she had accepted the plaintiff's witnesses as witnesses of truth and preferred their evidence to that of the defendant's witness. She then said, having found liability proved, she found nothing in the defence case to cause her not to be satisfied, on the balance of probabilities, that the amount claimed was reasonably itemised for work done and materials provided, was reasonable in rates charged and, further, was accepted in the sense of no dispute by the defendant in meetings with the plaintiff. The final heading in the stated case is "Appellants Contention". Under that heading the following appears: "The appellant contends that the determination was erroneous in law in that there was not sufficient evidence upon which I could conclude that the plaintiff discharged the burden of proof placed on him, namely that the plaintiff was not required to produce any evidence, any invoice, receipt, account and other documentation to prove his claim as required by the defendant. The plaintiff only gave verbal evidence of rates appropriate to labours and tradesmen and of expenses incurred." The stated case in this form came before Studdert J last year. He commented on its inadequacy. As it stood, it was both imperfect and doomed to failure. The contention made under the heading of "Appellant's Contention" could not possibly succeed. Appeals by way of stated case from Magistrates to the Supreme Court are limited to questions of law. Studdert J appears to have indicated to the parties that the only way the appellant could seek to pursue the stated case would be on the basis that there had been no evidence upon which the Magistrate had been entitled to make the determination in favour of the plaintiff which she did, and that for such contention to be argued it would be necessary for the whole of the transcript of evidence before the Magistrate to be before the court. It also appears that at that stage counsel for the appellant/defendant ("Logwon") endeavoured to make clear to the court that the essential ground that Logwon wished to argue in the stated case was that the person appearing for Logwon before the Magistrate had been wrongly prevented (by the Magistrate) from cross examining in a way the representative wished to cross examine and from having before the court documents which the representative wished to have before the court. Assuming in Logwon's favour that that was made clear to the court, the proper course would have been to take whatever steps were open to Logwon to seek to have the stated case amended, both to incorporate the transcript and also to make plain what questions of law it was that Logwon was seeking to have argued in the Supreme Court. I do not need, in the present case, to go further into the detail of what courses (if any) were open to Logwon to achieve, by correct procedures, the result I have indicated. It is enough to say that nothing further happened than what I have already described, beyond Studdert J making an order permitting the use of the transcript of evidence before the magistrate in conjunction with the argument of the stated case. On that basis the matter came before Ireland J. Ireland J set out the Magistrate's determination, the Magistrate's finding on fact and the ground of determination as those matters appeared in the stated case. He then said that argued before him was a contention depending upon the High Court decision in Pavey and Matthews Pty Ltd v Paul. I need not describe the URJ TAYLOR v LOGWON PTY LTD (Priestley JA) 3 point involved in that argument any further for two reasons, it does not appear to have been an argument foreshadowed in the stated case nor was it part of the substantial argument which Logwon's counsel said was the argument which the appellant all along wished to raise. In any event, Ireland J found no appealable error in the approach adopted by the learned Magistrate regarding the basis of the plaintiffs claim. As it happens, T agree with that opinion, although it is not strictly relevant to this appeal in view of the way the appeal has proceeded. Ireland J went on to say that there was a matter of concern in the way in which the quantum of the claim was determined. He then referred to some matters appearing from the transcript at 41. He recounted some of those matters and took the view that what appeared at 41 of the transcript showed that what the Magistrate had done had the effect of closing off cross examination of the plaintiff, on documentation which the defendant's representative wished to cross examine on. His Honour said that to effectively deny counsel for the appellant the right to cross examine on the supporting documentation is in effect a failure on the part of the court to hear both sides of the matter for determination. I agree that if what the Magistrate did had been to deny counsel the right to cross examination then there would be a great deal to be said for the conclusion that there had been what used to be called a denial of natural justice and is nowadays called denial of procedural fairness, of a significant kind. However, upon reading the transcript, and upon reading at 41 in the context of the whole transcript, it does not seem to me that what the Magistrate did was either to preclude the obtaining of relevant documentation by Logwon, or any kind of ruling that cross examination on a particular issue could not be pursued. On reading at 41 I, myself, find it difficult to see how the submission made by Logwon about the effect of what occurred at that point could even be a tenable one. However, the fact that Ireland J had a different view has caused me to examine at 41, now on a number of occasions, and to see that what his Honour thought happened is a possible reading of the page. Nevertheless to me it is a most unlikely one; and certainly not the way I read the transcript. In the course of discussion today the passage was read, and I commented on it as it was read, in a way which indicated my view of the better reading. I do not think it necessary to repeat that material in giving these reasons. In my view, a reading of the entire transcript and then focussing upon at 41 is sufficient to demonstrate to a reader that there was no denial of natural justice or procedural fairness in what occurred. Because of the view that he formed, Ireland J concluded that he should quash the Magistrate's judgment and made an order accordingly and then remitted the matter to the Local Court for re determination. The plaintiff, in the Local Court, then sought leave to appeal to this Court, which was granted, and the appeal came on for hearing today. Many of the plaintiff/appellant's grounds of appeal were concerned with the procedural aspects of the matter which involved a very substantial point: whether the matter upon which Ireland J decided the case was one which was open to him to embark upon. Other procedural aspects concerning the way in which cases should be stated and dealt with were either raised or involved in the grounds of appeal. 4 UNREPORTED JUDGMENTS The court took the view it should deal, in the first instance, with what counsel for Logwon said was the substantial point on which her client sought to rely, and had been the substantial point upon which her client relied throughout the proceedings, at least in the Supreme Court. We accordingly heard Logwon's counsel first. She submitted, as I have already more than once indicated, that the point which her client had wished to pursue in the Supreme Court was that her client's representative had been prevented from getting documentation before the court and from cross examining, by rulings of the Magistrate, which amounted to procedural unfairness of a substantial kind. I have already given my reasons for my opinion that on the material before Ireland J and before this Court, that ground could not be made out. It would follow from that opinion that Ireland J's orders should be set aside. On this approach, it is not necessary to deal with the other matters that I have touched on, apparent from the written submissions filed by the plaintiff (the appellant in this Court), concerning the way in which the case stated procedure was used, and the way in which Ireland J came to decide the case on the basis upon which he did. But by not going any further into those points, I would not wish to be understood as in any way indicating approval of the way in which the procedural matters that preceded the argument before and decision by Ireland J were handled. Without stating any concluded opinion on the matter it seems to me that the present case is a fine example of both the frequent inutility of the case stated procedure and even more frequent failure to utilise it properly and correctly. In my opinion the court should set aside the orders made by Ireland J and dispose of the stated case in a way indicating that had the question been asked in the stated case, as it should have been, "Was my determination specified in the stated case erroneous in law for the reason asserted by the defendant (Logwon)?", in my opinion the answer would have been "No". The substantial result will be that the Local Court Magistrate's judgment will stand. Handley JA I agree. Miss Pentalow has said everything that could possibly havebeen said on behalf of the appellant in this court, but in truth, as the presiding judge has demonstrated, her task was an impossible one. I agree that the appeal to this Court should be allowed and orders should be made as proposed by the presiding Judge. Powell JA Although it is my view that, having regard to the limited nature of the appeal from a Local Court provided for under the Local Court (Civil Claims) Act 1970 and the form of case which was stated by the learned Magistrate in the present case, it was not open to the present respondent to advance before Ireland J the arguments which were advanced, nor was it open to Ireland J to take the course which he has taken, nonetheless it seems to me that in the circumstances explained by Priestley JA, that view is of no consequence for even, if those arguments were, and that course was, open, the arguments were, in my view, of no substance and the course which his Honour adopted was, therefore, in error. I, likewise, agree that the appeal should be upheld, with costs, and the case remitted to the learned Magistrate with the expression of opinion indicated by Priestley JA. Priestly JA The court will make the orders as particularised by Powell JA. 1. Appeal upheld with costs. URJ TAYLOR v LOGWON PTY LTD (Priestly JA) Counsel for the Appellant: MM HILBERY Instructed by: MANNIX ENRIGHT Counsel for the Respondent: J PENTELOW Instructed by: WHITFIELDS