Freiberg International Pty Ltd v Iken Commercial Interiors Pty Ltd [1995] ACTSC 42 (5 May 1995)

SUPREME COURT OF THE ACT

FREIBERG INTERNATIONAL PTY LTD v. IKEN COMMERCIAL INTERIORS PTY LTD
No. SC209 of 1995
Number of pages - 3
Practice and Procedure

COURT

IN THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
MASTER A HOGAN

CATCHWORDS

Practice and Procedure - Summary Judgment - Defendant showing cause - Claim for goods sold and delivered - Contract and non-payment of balance of price not disputed - Cross demand for defects in quality and delays in delivery - Formal defence not tendered - Evidence needed to disclose nature of defendant's claim.

Evidence Act 1995 ss.48,69.

Mondel v Steel (1841) 8 M and W 858; 157 ER 1288
Galambos v McIntyre (1974) 5 ACTR 10

HEARING

CANBERRA, 28 April 1995
5:5:1995

Counsel for the Plaintiff: Mr Constance

Instructing Solicitors: Sneddon Hall and Gallop

Counsel for the Defendant: Mr Erskine

Instructing Solicitors: Clayton Utz

ORDER

THE COURT ORDERS THAT:
1. The plaintiff's application for Summary Judgment is dismissed.

DECISION

MASTER A HOGAN This is an application by the plaintiff for leave to enter Summary Judgment in an action commenced by writ on 30 March 1995.

2. The Statement of Claim alleges an agreement in writing made on 16 December 1993 whereby the plaintiff agreed to supply and deliver to the defendant various workpoint screens and components for an agreed price of $873,071. The price was later varied by agreement to $865,690.78.

3. Delivery was alleged, and the pleading acknowledged payment of $671,355.77.

4. The claim was for the unpaid balance due under the agreement of $194,334.75, together with interest pursuant to s.69 of the Supreme Court Act 1933.

5. The defendant appeared on 4 April 1995.

6. The affidavit read on the plaintiff's behalf was that of the receiver and manager of the plaintiff company. He verified the cause of action in the Statement of Claim, and swore to his belief that the defendant had no defence to the action.

7. On the hearing of the application the defendant did not contest the making of the contract, the delivery, the payments on account, or the non-payment of the balance of the price.

8. AffIdavit evidence was given by a director of the defendant company. It annexed a volume of correspondence relating to the making of the agreement, and to difficulties that arose during its implementation. The correspondence detailed complaints about defects in quality, and delays in delivery. It itemised a claim for damages and deductions which resulted in an amount exceeding the plaintiff's claim by $38,109.

9. It was submitted that the defendant should not be granted leave to defend for two reasons.

10. One was that no formal defence, that is, as a pleading, was tendered or disclosed by the evidence.

11. The other was that the director's affidavit merely annexed the documentation. It did not contain any evidence that the delays in fact took place, or that the defects and other bases of the defendant's alleged counterclaim existed in fact.

12. It is clear that the plaintiff is entitled to the order sought "unless the defendant satisfies (the Judge) that he has a good defence to the action on the merits, or discloses such facts as are deemed suffcient to entitle him to defend the action generally." O.15 r.1(2).

13. Usually, it is good advocacy for a defendant who seeks to persuade the court that he has a defence to annex or tender a draft of the defence. But it is not a condition of being granted leave to defend.

14. The defendant is not required to defend the action in order to obtain leave to defend. The defendant's affidavit must "disclose", not necessarily prove, "such facts as are deemed sufficient to entitle him to defend the action generally."

15. The existence, and the terms, of the annexures to the defendant's affidavit in this case are themselves sufficient to disclose the nature as well as the existence of the defendant's complaints.

16. But I think that the material here goes further.

17. The affidavit annexes documents that purport to be copies of the documents in question, which are therefore evidence of their contents. Evidence Act 1995 s.48 (1)(b)(i).

18. The affidavit proves that the documents form part of the records kept by the defendant in the course of, and for the purposes of, carrying on its business, and they contain representations of fact recorded in the documents in the course of and for the purposes of the business. Section 69 of the Evidence Act 1995 therefore applies to them. See s.69 (1).

19. The deponent, the director of the company, might reasonably be supposed to have had personal knowledge of the facts asserted in the company's documents. That is clear from the nature of the documents themselves. The hearsay rule therefore does not apply to those documents. Evidence Act 1995 s.69 (2).

20. They are therefore evidence of the facts "represented" in them.

21. It is clear therefore that the material adduced by the defendant does afford evidence of facts which, if true, establish an arguable defence.

22. There is quite sufficient detail in that material to demonstrate what is the nature of the defendant's case, and to give particulars of the way in which the claim is calculated.

23. I have considered whether it would be appropriate to grant leave to the plaintiff to enter judgment, and to stay execution pending the determination of the defendant's action.

24. At least part of the defendant's case, based on complaints about the goods supplied, if it is made out, would afford a defence to the plaintiff's action at common law, under the principles enunciated in Mondel v Steel (1841) 8 M and W 858; 157 ER 1288. The balance, based on claims for delay, clearly constitutes, at the least, an equitable set off, being so intimately connected with the contract on which the plaintiff sues, as to make it inequitable to allow the plaintiff to proceed with its claim without making allowance for the defendant's claim. There are many authorities for this proposition, but the one most directly binding on me, as well as affording a clear exposition, is Galambos v McIntyre (1974) 5 ACTR 10.

25. The plaintiff's application for summary judgment is dismissed.