Supreme Court New South Wales Medium Neutral Citation: Mahaffy v Eather t/as Bellevue Pastoral Company [2013] NSWSC 132 Hearing dates: 29 November 2012 Decision date: 14 February 2013 Jurisdiction: Equity Division Before: Justice Rein Decision: 1. Appeal allowed. 2. Set aside the judgment of the Magistrate Connell on 28 October 2009. 3. Order that the matter be returned to the Local Court for new trial to a venue to be determined by the Chief Magistrate. 4. The costs of the first trial be determined by the Local Court in the retrial. 5. The defendant pay costs (such as they are) of the plaintiff. Catchwords: APPEAL AND NEW TRIAL - Appeal - Practice and procedure - New South Wales - Extension of time for appeal APPEAL AND NEW TRIAL - Appeal - General principles - Error of law - Adequacy of reasons APPEAL AND NEW TRIAL - Local Court - Civil Claims - Appeal and new trial CONTRACTS - Formation of contractual relations - Contract implied from conduct of parties CONTRACTS - Building, engineering and related contracts - Performance of work - Effect of acceptance Legislation Cited: Local Court Act 2007 (NSW) Cases Cited: Alchin v Daley [2009] NSWCA 418 Bagumya v Kakwano [2010] NSWSC 600 Coshott v Lenin [2007] NSWCA 153 Currabubula Holdings Pty Ltd v State Bank of New South Wales [2000] NSWSC 232 Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523 Hamod v Suncorp Metway Insurance Ltd [2006] NSWCA 243 Kriketos v Livschitz [2009] NSWCA 96; (2009) 14 BPR 26 Mifsud v Campbell (1991) 21 NSWLR 725; (1991) 13 MVR 243 Pollard v RRR Corp Pty Ltd [2009] NSWCA 110 SAS (Sales) Pty Ltd v SJPJ Pty Ltd [2011] NSWSC 905 Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 The Owners - Strata Plan 32735 v Lesley-Swan [2012] NSWSC 383 Toll (FGCT) Pty Ltd v Alphafarm Pty Ltd and others [2004] HCA 52; (2004) 219 CLR 165; (2004) 211 ALR 342; (2004) ALJR 129; (2005) Aust Contract R 90-204 US Manufacturing Co Pty Ltd v ABB Service Pty Ltd [2008] NSWSC 705 Category: Principal judgment Parties: Peter John Mahaffy (Plaintiff) Darren E Eather T/As Bellevue Pastoral Company (First Defendant) Lynette D Eather T/As Bellevue Pastoral Company (Second Defendant) Leanne S Eather T/As Bellevue Pastoral Company (Third Defendant) Warren T Eather T/As Bellevue Pastoral Company (Fourth Defendant) Representation: Counsel: Ms T.R. Gordon (First, Second, Third and Fourth Defendant) Plaintiff in person Solicitors: Mr Russell John Booby (First, Second, Third and Fourth Defendant) File Number(s): 2009/297280 Judgment 1REIN J: This is an appeal in connection with a decision of his Honour Magistrate Connell sitting at Wee Waa on 28 October 2009. The plaintiff appears in person and Ms T Gordon of counsel appears for the defendants. The appeal was originally brought pursuant to s 40 of the Local Court Act 2007 (NSW) ("the Act") but it was extended to include an appeal under s 39 of the Act. 2The Summons of Appeal was filed 15 days out of time and the plaintiff has sought an extension of time within which to bring his appeal. His explanation is that he did not understand the procedure and did not obtain adequate help about the nature of the document required until early December 2009. 3The plaintiff, who is an irrigation surveyor, represented himself in the Local Court proceedings and has at all times done so in this court. He is not legally trained and I accept that he made clear from the time of the Magistrate's decision that he was considering an appeal and that the reason for the late filing of the appeal was due to his ignorance of the correct procedure. There a number of other factors which are to be taken into account on an application for an extension of time, discussed in Currabubula Holdings Pty Ltd v State Bank of New South Wales [2000] NSWSC 232 at [87] per Einstein J. Having regard to those factors, which include the "history of the proceedings, the conduct of the parties, the nature of the litigation, the consequences to the parties of the grant or refusal of an extension of time and the prospects of the appeal's success and any prejudice to the defendants by extending time", in my view, leave to extend time for the application should be granted to the plaintiff, save in one respect which I shall detail below. The delay was very short, the reason for it is understandable, there is no real prejudice to the defendants and I think there is a serious basis for questioning the correctness of the decision of the Magistrate. An important fact against leave is the small amount of money involved. The exception to the leave granted is in respect of the learned Magistrate's decision to reject, after the close of evidence, the plaintiff's application to introduce a claim for quantum meruit. His Honour's decision to refuse leave was a discretionary one and I think he had ample grounds for refusing an amendment after the close of evidence, with no evidence of whether plaintiff's charges were in line with the market or not and no investigation of the value to the defendants of whatever plaintiff had done. At least a portion of such quantum meruit claims would have been statute-barred on the authority of Coshott v Lenin [2007] NSWCA 153, the work having been undertaken many years before 6 March 2002 (that is, the date six years before the commencement of proceedings). 4In the Local Court proceedings the plaintiff initially claimed that, pursuant to what he called a "continuing contract", he had been engaged by the defendants, who owned rural property outside Wee Waa, to carry out an irrigation survey and work connected with compliance with requirements imposed by legislation on landowners. In the course of the hearing before the Magistrate, he put his claim on the basis of three separate contracts. The first contract, he claimed, was made in 1995, the second in September 1999 and the third in March 2002. By far the most substantial part of the claim is in respect of the 2002 contract, that is, for more than $15,000, out of a total claim of approximately $19, 000, principally for survey work carried out on two rural properties owned by the defendants. The plaintiff's case is that the defendants initially contracted him because they were seeking to oppose work carried out by their neighbour, Mr Warnock, and wanted his assistance to block that work but that they later sought his assistance to obtain approval for improvements (including a dam) on their own property (actually three properties by 2002), the defendants having been pressed by the Department of Land and Water Conservation ("the Department") to produce a flood study (a requirement of the legislative process for approval). The flood study was itself dependent on the survey which, on the plaintiff's case, he was asked to prepare. 5The work carried out between 1995 and 1999 was far more limited and included, the plaintiff claimed, work carried out in helping the defendants promote an objection to Mr Warnock's improvements. The plaintiff claimed that the defendants had in September 1999 engaged him to do work and that he had sent a fee agreement letter to them. However, the plaintiff said in the course of his oral evidence (see the Exhibit A at p 308, all subsequent page references are to Exhibit A unless otherwise stated) that some six weeks after a letter containing the plaintiff's terms and conditions had been sent to the defendants, they told him that they had not decided whether to proceed with the work at that stage. So far as work before 1999 was concerned, this involved time for attendances at the property and drafting letters to the Department. It was not disputed that the plaintiff had attended the property and had drafted letters to the Department. 6Before the Magistrate in the plaintiff's case were two affidavits of the plaintiff and two affidavits of Mr David Smith, an employee of the plaintiff. In the defendants' case there were affidavits from Messrs Darren Eather ("Darren") (first defendant) and Warren Eather ("Warren") (fourth defendant), who are son and father, and Mrs Leanne Eather ("Leanne") (third defendant), wife of the first defendant, who said she had no involvement in any of the matters. 7There was no dispute in that the plaintiff carried out unrelated work for the defendants in 2002 for which he had been paid in 2003. The defendants denied that they had ever retained the plaintiff to do any work which are the subject of the invoices. Darren admitted that he had signed a letter dated 7 November 2000 to the Department ("the November Letter") advising the Department that he had retained the plaintiff to "undertake a survey and liase [sic] with Mr George Whitehouse on our behalf" but it was agreed that the plaintiff had drafted the letter and Darren said (and this is disputed by the plaintiff) he had not read the letter when he signed it (see p 108 - 109). Mr Whitehouse was a person with extensive experience in the preparation of flood studies and with whom the plaintiff collaborated from time to time. 8The plaintiff deposed to having had a meeting in March 2002 with Warren and Darren at their property, in which they showed him the dam and improvements which the Department were complaining about. The plaintiff says that he indicated to the defendants the work that would have to be performed and that he told the defendants he would be forwarding an updated letter concerning his fees and charges. His evidence was that he sent the next day the letter of March 2002 and that later in the month he sent Mr Smith to the defendants' property to survey the property in accordance with the agreement. The plaintiff says it took him several weeks to prepare the map reflecting the survey work and that he sent the map to the defendants in May 2002. The map is in evidence: see Exhibit B. Mr Smith's evidence was that he met with Warren and or Darren on the several occasions that he was on their property. 9The defendants denied almost every material part of the plaintiff's factual allegations save to accept that the plaintiff had drafted the November Letter and had taken some steps in relation to the Department, and that they had received the invoice in 2007 no part of which had been paid. 10The Magistrate's decision had these components (leaving aside the rejection of the quantum meruit component): (1)his Honour treated as very significantly impacting on the plaintiff's credibility the fact that he did not mention in his affidavit that Darren had told him in 1999 that they had not decided to proceed with the work that was the subject of the November Letter; (2)his Honour thought it very significant that Mr Smith's recollection of events appeared poor during cross-examination but his second affidavit had been quite detailed; (3)his Honour thought it very significant that the plaintiff had not sent out invoices for the work for a period of 12 years from 1995 and 5 years from the 2002 work; (4)his Honour thought it significant that Mr Whitehouse, who the plaintiff said was to prepare the flood study, had not sent any bill to the defendants for his attendances on the work he had done; and (5)his Honour appeared to accept a version of events put forward by the defendants that the plaintiff was working on his own agenda in carrying out the survey and other work; and his Honour was not satisfied that the defendants had instructed the plaintiff to carry out the survey work in 2002 or carry out earlier work of writing to the Department or that the plaintiff attended the defendants' property on the defendants' behalf.. 11The plaintiff's complaint against the decision can be summarised as follows: (1)his case before the Local Court was: (a)the defendants had asked him to carry out work; (b)he had sent them, in a letter of September 1999 and again in March 2002, details of his charges; (c)he carried out the work, the most significant item of which was the survey work, that they requested him to perform; and (d)whilst it is true that the defendants did not sign either of the fee agreement letters, they were on notice of the terms of the letters and, having asked the plaintiff to carry out work, must be taken to have contracted on that basis until they stated otherwise: see Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523 and Kriketos v Livschitz [2009] NSWCA 96; (2009) 14 BPR 26, 717; and (2)the Magistrate erred in: (a)not properly considering the significance of documents signed by or sent by the defendants: the November Letter (Exhibit L), a fax dated 15 December 2000 at p 123 (Exhibit R) and a fax dated 5 December 2000 at pp 116 - 118 (Exhibit P); (b)not accepting the plaintiff's evidence that he had been instructed by the defendants to do the work; (c)not accepting Mr Smith's evidence that he had attended at the defendants' property to do the survey work and spoke with Darren and Warren; (d)not accepting the plaintiff's evidence that he had provided the survey to the defendants in May 2002; and (e)not appreciating that the defendants were dishonest in: (i)denying they had sent the fax of 15 December 2000 and even asserting that it was fraudulent; (ii)denying they had received letters and the survey sent by the plaintiff; and (iii)their explanation of why they had signed the November Letter; and (3)the plaintiff relies on: (a)the objective test for determining the effect of a contract and as to whether a contract has been formed: see Toll (FGCT) Pty Ltd v Alphafarm Pty Ltd and others [2004] HCA 52; (2004) 219 CLR 165; (2004) 211 ALR 342; (2004) ALJR 129; (2005) Aust Contract R 90-204 and (b)cases such as Mifsud v Campbell (1991) 21 NSWLR 725; (1991) 13 MVR 243 and Pollard v RRR Corp Pty Ltd [2009] NSWCA 110, addressing the need for reasons to adequately deal with points critical to the factual contest between the parties. 12I recognise that the learned Magistrate's judgment was detailed particularly having regard to the amount involved and that the case was one in which the Court had the added difficulty of dealing with events from a very long time ago and one in which the plaintiff not legally trained was representing himself. 13To obtain leave to appeal for the purpose of s 39 of the Act, the plaintiff must establish that there has been an error on a question of law or mixed law and fact. Leave is not required for the purpose of an appeal under s 39 which permits an appeal where it is claimed that the decision is erroneous in law. 14In coming to the view that the plaintiff has failed to establish that the three contracts were made, the Magistrate expressed doubts as to the credibility of the plaintiff and Mr Smith. The Magistrate generally accepted the honesty of the defendants, implicitly rejected the plaintiff's evidence that the defendants had verbally instructed him to proceed with the work and did not accept that the defendants must have known that work was being carried out by the plaintiff and Mr Smith. His Honour said: "As I've said, the court needs to look at this situation objectively. Mr Mahaffy seemed to be driving something that the defendants did not want to be a part of or even understood they were part of and it seems to me there was a great deal of assumption on the plaintiff's part." 15Ms Gordon contended that many of the plaintiff's grounds of appeal were really appeals on questions of fact and hence not available. Further Ms Gordon submitted that on all of those which could be characterised as a question of mixed fact and law, leave should not be granted. Ms Gordon drew attention to what had been said by Hall J in US Manufacturing Co Pty Ltd v ABB Service Pty Ltd [2008] NSWSC 705 at [54], that included within the phrase error in point of law are: (1)A finding made where there is no evidence to support it or draws an inference from facts that cannot be reasonably drawn. (2)A finding that no person acting judicially and properly instructed as to the relevant law could have made. (3)Where a Court has misdirected itself in law: Australian Gas Light Co v Valuer-General (above) and Ms Gordon referred to what was said by Basten JA, with whom Beazley and Santow JJA agreed in Hamod v Suncorp Metway Insurance Ltd [2006] NSWCA 243 at [10] - [11] that an error of law (or of mixed fact and law) will only give rise to a ground of appeal if the error was material to the outcome of the hearing. Further, Ms Gordon drew attention to the approach of Rothman J in Bagumya v Kakwano [2010] NSWSC 600 at [39] - [42] reiterating that question of credibility are questions of fact and that errors of fact do not support an appeal from the Local Court. 16The cases mentioned, I accept, require caution in the approach to a decision in which the learned Magistrate has clearly endeavoured to provide reasons but there are a number of cases (commencing with Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 per McHugh JA and Mifsud v Campbell per Samuels JA with which Clarke JA and Hope A-JA concurred and leading to Pollard v RRR Corp Pty Ltd which make it clear that the appellate Court is entitled to consider whether the reasons provided are sufficient in the circumstances. 17I summarise what was said about reasons by McColl JA, with whom Ipp JA and Bryson AJA agreed, in Pollard v RRR Corp Pty Ltd at [57] - [66] as follows: (1)failure to provide sufficient reasons in a judgment works a miscarriage of justice; (2)the test of adequacy is relative and will depend upon the particular case under consideration and the matters in issue; (3)while a judge is not obliged to spell out every detail of the process of reasoning, it is essential to expose the reasons for resolving a point critical to the contest between the parties - the parties should be able to identify the basis of the judge's decision and the extent to which their arguments had been understood and accepted; (4)a judge is not necessarily obliged to refer to all of the evidence, but should refer to evidence which is important or critical to the proper determination of the matter - thus, where relevant evidence, particularly conflicting evidence of a significant nature, is not referred to, an appellate court may infer that that evidence was overlooked or not considered; and (5)in referring to such evidence, bold conclusionary statements should be eschewed - analysis should be made of evidence competing with evidence that is apparently accepted and explanation should be given in the judgment for rejecting competing evidence. 18In several cases since, this court has given consideration to the extent to which a Magistrate must undertake an analysis of conflicting evidence: see for example The Owners - Strata Plan 32735 v Lesley-Swan [2012] NSWSC 383 per Hall J and SAS (Sales) Pty Ltd v SJPJ Pty Ltd [2011] NSWSC 905 per Schmidt J. 19Ms Gordon helpfully prepared a document (MFI 1), in which she set out a chronology of communications between the plaintiff and the defendants, taken from the appeal book, with reference to the documentary and oral evidence. It is a useful starting point in considering the essential factual issues in the case and I have taken it into account. 20There are a number of key matters in the plaintiff's evidence relating to the 2002 contract (and on which I focus given the comparative size of that claim) to which reference needs to be made: (1)in paragraph 61 of his affidavit sworn 6 June 2008 9 (see p 71), the plaintiff deposed as follows: "On 12th March 2002 I travelled to the defendants['] properties and looked at what they now wanted to do. I was on site with the defendants for 2 hours looking at what they proposed. We looked at an existing dam site in a gully that the defendants wanted to extend. Both Warren and Darren Eather were there. We discussed a number of things. I told the defendants the extent of the survey necessary and how the analysis would have to be done. I remember Warren Eather said to me: "Years ago you wouldn't have to do all this work, you would just go ahead and build the dam and worry about it later." I told the defendants I would get my staff to come out and start the survey. I also told them I would send them out my updated rates of charge. I also told the Defendants that I would have George Whitehouse and Andy Pike at Wee Waa on another job later that week." (2)the plaintiff says that on 12 March 2002 he sent the defendants a letter. A copy of the letter was in evidence: see p 143; (3)at paragraph 63 of his affidavit (see p 71), the plaintiff says he discussed the defendants' work with Mr Whitehouse and a Mr Pike in Wee Waa a few days later; (4)at paragraph 64 of his affidavit (see p 71), the plaintiff says he arranged for his staff to start the survey of the defendants' farms on 15 March 2002; (5)an employee of the plaintiff's, Mr David Smith, gave evidence that the plaintiff took him out to the properties and showed him what surveys he wanted. Mr Smith said he did that work in March 2002, and that he was paid for the work he did in surveying the defendants' property - some of which surveying was done from the adjoining property; (6)the plaintiff says at paragraph 65 and 66 of his affidavit (see p 71) that he commenced processing the survey data on 27 March 2002 and that he took a rough plan of the survey with him when he met with Mr Whitehouse on 15 April 2002; (7)the plaintiff says he finalised a survey of the property in early May 2002 and arranged for his secretary to mail the survey to the defendants (Exhibit B); (8)Mr Whitehouse became ill in 2003 and died late that year. The plaintiff says he informed the defendants that Mr Whitehouse had died and recommended that he work with Mr Ian King. The plaintiff says that Darren's response (p 73) to that was: "Well let us know if we can, but I don't think there is any rush, the department don't seem to be putting any pressure on us now." (9)the plaintiff tendered letters from the Department to the defendants which made it clear that the defendants needed approval for existing and proposed earthworks on Bellevue, one of the properties owned by the defendants. One of the letters (dated 31 May 1999: see p 88) said: "Please advise within 14 days from the date of this letter what action has been taken to submit a Consultants Report in support of your application as outlined by my letter and more recent telephone conversation As has been stated previously, lodging of an application does not authorise construction of any earthworks. It is an offence under the Water Act to construct a controlled work within a designated area without approval and penalties apply to breaches of the Act, a factor that has been tolerated to date, however it must be emphasised, this situation must now be addressed." (10)the plaintiff tendered a letter dated 7 November 2000 addressed to the Department (Exhibit L in the Local Court, p 108) (which it is agreed was drafted by him) signed by Darren, in which Darren stated: "I have engaged Peter Mahaffy to undertake survey and liase [sic] with George Whitehouse on our behalf." The letter referred to contact that had been made by the plaintiff on the defendants' behalf and stated that the defendants wish to maintain their objection to Mr Warnock's application, but raised the possibility of working with Mr Warnock to reach agreement. The letter also stated: "Finally, regarding our own application, because of the fire and my illness, unfortunately Mr Mahaffy and Mr Whitehouse have not been instructed to proceed. I will now contact them and request they continue with whatever is necessary to undertake our study" (see p 109). (11)Leanne sent to the plaintiff a document which she described as "points of discussion" (pp 116 - 118) and the plaintiff sent a note to a Mr Kevin Lewis for the purposes of aerial photography (p 119). (12)the plaintiff tendered a fax from Darren and Warren (but unsigned) to the Department on 13 December 2000 (Exhibit R in the Local Court) which stated: "To date we are [sic] engaged Mahaffey [sic] Surveying to undertake the survey, also G Whitehouse, A Pike to do a floodstudy. Due to illness and flooding the survey's [sic] are not quite finished as planned. However, we expect all surveying of 'Amaroo' and above. Stream to be completed no later them the end of January. A comprehensive flood study is them to be complied by G Whitehouse into how existing structure on 'Amaroo' can be changed to cope with blowout water from 'Warilea'" (13)it was relevantly an agreed fact that: (a)the defendants had lodged an objection to a dam on Mr Warnock's property and continued their objection until the matter was resolved by the Department; (b)that in the 1990s, the defendants lodged a Pt 8 application for control works on their properties, which works had not, as at the date of the hearing, been approved; (c)the defendants sent information to the plaintiff about Mr Warnock's dam and their own works; (d)the plaintiff worked with Mr Whitehouse in relation to Pt 8 applications and surveys for flood studies; (e)the plaintiff and Mr Whitehouse made several visits to the defendants' properties commencing in 1995; (f)the plaintiff wrote several letters to the Department about the defendants' Pt 8 application and their objection to Mr Warnock's dam. 21The material which I have set out presents a very strong case to support the plaintiff's contention that he was retained by the defendants to carry out work for them and did carry out work, and for which has not been paid, although some of the material predates the 2002 contract. 22I shall set out the response of the defendants to each of the matters enumerated in [19]: (1)the defendants admitted that they had met with the plaintiff in March 2002 at their property but claimed that the meeting had not been requested by them and that the plaintiff had merely been passing by; (2)the defendants denied having received the letter of 12 March 2002; (3)the defendants by [19](13)(d) admitted that the plaintiff had worked with Mr Whitehouse; (4)in relation to [19](4) and (5) Darren said he had never seen anyone undertaking the work and the implication was that if Mr Smith did so it was as a result of a trespass. Warren said he saw Mr Smith and that Mr Smith had told him that he had been sent by the plaintiff to conduct a "satellite" survey; (6)this does not appear to be in dispute; (7)the defendants denied having received the map which was tendered in the Local Court hearing and is Exhibit B before me, until 2007, which they say was sent with the invoice; (8)the defendants did not dispute this; (9)the defendants did not dispute this; (10)in relation to Exhibit L, the defendants offered two responses. The first response was contained in the affidavit of Darren sworn on 17 July 2008(p 259): "[f]or a period we were happy to go along with the Plaintiff and to let the Department think that we had engaged him but usually it was the Plaintiff[']s suggestion and only ever to enable us to obtain copies of other studies or other relevant documents." The second response came in cross examination to the effect that he had not read the letter when he signed it and trusted the plaintiff. (11)In relation to Exhibit R, Darren said that it was not in a format ever used by the defendant's operation and that he believed he had never seen it before. (12)In relation to the correspondence passing between the Department, the defendants and the plaintiff, the defendants sought to promote several theories which were: (a)that the plaintiff was acting in his own interests, having some sort of vendetta against Mr Warnock or separate agenda of his own; (b)that the plaintiff was "badgering" them to protest against Mr Warnock's work; and (c)that although the Department seemed to be writing in firm terms about the lack of approval of the defendants' work, the Department did nothing about the absence of approval so the defendants were justified in taking no action in meeting the requirements of the Department. 23The learned Magistrate did say: "there is evidence in the plaintiff's case which might support the propositions for which the plaintiff contends in relation to a contract between the defendants and himself" (see T11.45 - 47 at p 3) and in relation to the March 2002 contract, his Honour seemed to accept that the plaintiff had arranged for Mr Smith to carry out survey work and that the plaintiff had carried out work leading to preparation of the survey map based on Mr Smith's work. 24If it is accepted that Mr Smith did: (1)attend the defendants' property within a few weeks of the date that the plaintiff was present at the property (and the plaintiff's visit itself is not disputed); (2)carry out survey work on the property, as he asserts (and not on some next door property, as the defendants assert); (3)prepare a survey map based on the data provided by Mr Smith; (4)provide that survey to the defendants, as he says he did; then a very significant question arises as to whether the defendants have given a truthful account of the meeting on 12 March 2002 at the property. 25When one adds to that the fact that: (1)it is the plaintiff's evidence that he sent a letter to the defendants referring to discussions that day and setting out his fees (and GST requirements); (2)Darren signed a letter on 7 November 2000 to the Department prior to that advising that the defendants would engage the plaintiff to undertake a survey and liaise with Mr Whitehouse; and (3)that the plaintiff had, on his evidence, sent letters to the defendant containing his terms which the defendants asserted they had never received; (4)the existence of the fax of 15 December 2000 sent, on its face, by Darren (but not signed) to the Department and provided to the plaintiff, which again confirms that the defendants have appointed the plaintiff; and (5)the correspondence from the Department, which made it clear that the defendants needed a flood study if the improvement undertaken on their property were to obtain approval and for their objection against Mr Warnock's work to be considered (see pp 99-100, 129-130, 136-137, 233-234); (6)the plaintiff did meet with Mr Whitehouse and a departmental officer in connection with the defendant's properties in March, May and July 2002; there is really a body of evidence which tends to support the claims of the plaintiff and which needed to be dealt with. I accept that a judge could come to a view that a party has exhibited such a level of dishonesty that nothing he says could be accepted without independent corroboration but the terms of the Magistrate's criticism of the plaintiff are far from that, and he does not state that he does not accept any of the evidence of the plaintiff for that reason. If the Magistrate accepted that the plaintiff did arrange for Mr Smith to do the work and Mr Smith did do the work within a few weeks of the conversation on 12 March 2002 and if the plaintiff did send the letter of 12 March 2002, this is conduct which very much speaks to the veracity of the plaintiff's evidence about his conversation on 12 March 2002. If the plaintiff's evidence of his conversation on 12 March is accepted and receipt of the letter by the defendants is accepted, contrary to their denial, there would need to be careful analysis to support rejection of a contract having been formed notwithstanding the absence of a signed document, if the objective approach to formation of a contract was to be applied as his Honour accepted it ought be. 26An important and relevant matter is the absence of any evidence to support the defendants' contention that the plaintiff was carrying out work for some other purpose than assisting them and his Honour's conclusion that the plaintiff "seemed to be driving something that the defendants did not want to be a part of or even understood they were part of" (T18.1 - 4 at p 40) which I have earlier set out. The defendants' assertion that the plaintiff had persuaded them in 1995 to lodge a complaint in relation to Mr Warnock's work is proven false by the fact that they had lodged a complaint in 1993 well before the plaintiff was involved in the matter. The learned Magistrate seemed to place considerable significance on the ulterior purpose point but it was, in my view of the evidence, unfounded and it is not at all clear how his Honour came to accept it. 27There is a further matter which relates to credibility of witnesses. There is no consideration of the impact on Darren's credibility of the inconsistency between his two explanations for having signed the letter of 7 November 2000 (Exhibit L). If what he said in his affidavit (set out above at [21](10)) were true it would indicate a willingness to deceive the Department about his intentions. It appears that the defendants were keen to avoid spending money on something that was not necessary but the letter of 7 November 2000 indicates an acceptance that it was necessary. Nor is there any consideration of the denial by the defendants of responsibility for the fax of 15 December 2000 and the suggestion that it might have been prepared by the plaintiff, which was then withdrawn at T130.13 - 19 at p 407. No comment was made in the judgment about Leanne's fax of 5 December 2000 and her affidavit in which she gave no explanation for it and denied any direct involvement. 28I accept that the Magistrate did express a view about the plaintiff's credibility and that of the defendants. I do not think, however, that there was a sufficient consideration of the objective material before the Court in relation to the plaintiff and there was virtually no explanation of why he rejected the contentions of the plaintiff as to the defendants' honesty and veracity. There is no analysis explaining the supposed hidden agenda of the plaintiff, as asserted by the defendants, and apparently accepted by his Honour, and no explanation why elements of the defendants' assertion in that regard could stand in the light of the plaintiff establishing that complaints about the neighbour's property had been made by the defendants well before they contacted the plaintiff. There is no analysis of the impact of Darren's assertions in his affidavit (p 259). 29There are some further matters to which I should refer. The learned Magistrate: (1)Accepted as "a good and relevant point" Darren's contention that if he had asked for the survey in 2002 he would have been chasing the plaintiff for it and there is no evidence of that. The problem with that contention is that it accepts Darren's assertion that he did not receive the survey until 2007 when the plaintiff's evidence is that it was sent in May 2002, a few months after the conversation of 12 March 2002; (2)Did not appear to reject Mr Smith's evidence of having carried out the work of surveying the defendant's properties; (3)Said that the plaintiff's affidavit did not contain "any record of verbal instructions from the defendants to carry out the work" but if the conversation deposed to by the plaintiff in his affidavit (which I have set out at [19](1) above) is accepted, it is, coupled with the information about rates provided the following day, capable of supporting the conclusion that a contract was formed by words and conduct. This is particularly so if contrary to their denials the defendants were aware that the plaintiff in fact sent Mr Smith to carry out the work he did carry out needed to complete the work discussed in the conversation and referred to in the letter; (4)Referred to the plaintiff's failure to forward an account even after the survey was prepared. I agree that the failure to send an invoice for such a lengthy period is peculiar, and might bear on the credibility of the plaintiff, in the sense that the failure to send the invoice could be seen as corroboration of a finding that he did not do the work, that is the subject of the invoice. Although his Honour mentions the point (see T3.33 - 41 at p 25) it is not clear if his Honour has used the unusual circumstances in this way. The question of whether the failure to send the invoice within a reasonable time constituted a breach of an implied term (and its consequences) was not ventilated; (5)Referred to the plaintiff's evidence of earlier work and seems to raise the possibility that some of the survey work had previously been done. It does not appear that the defendants were asserting that the work, that is the subject of the third contract, was work that they had already paid for or was unnecessary; (6)Referred to the absence of any memorandum of fees from Mr Whitehouse. His Honour accepted that Mr Whitehouse died in 2002. It is unclear whether the learned Magistrate was relying on the absence of an invoice from Mr Whitehouse to support a finding that the plaintiff did not in fact have the meeting he said he had with Mr Whitehouse. No where does his Honour make any such finding or indicate positively that he does not accept there were meetings. 30Recognising that there are significant limitations on the appeal from Local Court decisions and that it is not simply a matter for the appellate court in such appeals to consider whether it would have reached a different result from that which the Magistrate reached on the credibility of witnesses or on the weight to be given to facts before the tribunal, in my view the judgment below does not provide a sufficient explanation or analysis of how his Honour arrived at the conclusion at which he arrived. 31In my view, the manner in which the issues I have identified in [24] - [30] were dealt with both individually and cumulatively constitute a failure to discharge the duty to provide sufficient reasons and is likely to give rise to a feeling of injustice in the mind of a reasonable litigant and hence constitutes an error of law. I conclude that leave should be granted and the decision below set aside. Whilst I accept that taken on their own a different conclusion might be reached about the earlier contracts, it seems to me that given my conclusion on the 2002 contract the entire proceedings should be reheard. 32The plaintiff submitted that were I to determine that the decision below should be set aside, I should determine the matter myself rather than remitting it to the Local Court. In this regard, I note that there were two issues raised by the defence which were not commented upon by the Magistrate. One was a limitation defence and the other was a defence that the contract was breached or repudiated by non-performance. In submissions on the limitations defence on behalf of the defendants in the Local Court reliance was placed on Coshott v Lenin, a case which relates to restitutionary claims and does not provide authority for the contention that, in contract, time commenced to run from when the work was carried out. The defendants were only in breach from the time of their failure to pay the plaintiff's invoice sent in 2007. Nothing was said about the breach of contract or repudiation point in the Local Court. These points were not mentioned before me as being relevant to my determination. Ms Gordon initially accepted that it was appropriate for me to determine the matter myself on rehearing (see T40.45 - 41.1 on 29 November 2012) but on the following day at 69 and on 5 December 2012 at T17.39 - 18.30 she submitted that should the appeal be allowed there should be a new trial. Given that the appeal has been successful on the basis of the inadequacy of the Magistrate's reasons and having regard to what was said by Samuels JA in Mifsud v Campbell (also by Sackville AJA with whom McColl JA and Young JA agreed Alchin v Daley [2009] NSWCA 418 at [57]) I accept Ms Gordon's submission that it is not appropriate that this Court determine the matter itself and that there should be a fresh hearing. Conclusion 33For these reasons given I think the judgment of the Local Court should be set aside and that there should be a new hearing. I think that the matter should not be remitted to the Magistrate who heard the matter for two reasons. The first is that he has made findings of credit against the plaintiff and secondly it has proven difficult for the matter to be heard in one session in Wee Waa and it would be preferable that the matter be heard in a larger venue, perhaps Armidale. The matter should be heard by a Magistrate at a place to be determined by his Honour the Chief Magistrate. Without in any way purporting to direct the Local Court I would encourage consideration of requiring a mediation in this matter prior to any rehearing in view of the small amount involved. 34The orders should therefore be: (1)Appeal allowed; (2)Set aside the judgment of the Magistrate Connell on 28 October 2009; (3)Order that the matter be returned to the Local Court for a new trial to a venue to be determined by the Chief Magistrate; (4)The costs of the first trial be determined by the Local Court in the retrial; (5)The defendant pay costs (such as they are) of the plaintiff. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 27 February 2013