1 This is an application by the plaintiff, Main Roads Construction Pty Ltd, for summary judgment against the defendant, Samary Enterprises Pty Ltd, in the sum of $456,978.98 said to be owing pursuant to six progress certificates issued by the superintendent under a building contract, plus interest under the contract on each of the overdue amounts from the date payment was due.
2 The proceeding was commenced by writ on 6 May 2005 and entered into the Building Cases List. The application for summary judgment was made by summons filed 17 June 2005. It was supported by an affidavit of the managing director of the plaintiff, Richard Frank Furnari, sworn on 2 September 2005. The name of the plaintiff in the heading to the affidavit was said to be "Main Roads Corporation Pty Ltd", and this is the name of the plaintiff given in some of the court documents filed by the defendant. An exhibited company search confirmed that this is indeed the correct name of the plaintiff, however, no order has yet been made permitting the name of the plaintiff to be amended in this way. Although nothing turns on this point, because the incorporation of the plaintiff is admitted, there will need to be an amendment made to state the correct name of the plaintiff in the title of the proceeding.
3 Contrary to the order made by me on 19 August 2005 that any affidavits from the defendant in opposition to the application for summary judgment be filed and served by 12 September 2005, the defendant did not serve any such affidavit until about 5.15 p.m. on 15 September 2005, which was the day before the adjourned date for the hearing of this application. This was an affidavit of one James Lytifi Sabri, the principal of a firm of chartered accountants, which acted as accountants for the defendant. Mr Sabri said that he had been actively involved in all aspects of the project and thus had personal knowledge of the relevant matters. Despite the late service of Mr Sabri's affidavit, no objection was raised by the plaintiff to the defendant relying on its contents.
4 Mr Furnari's affidavit established that on or about 27 April 2004 the plaintiff and the defendant entered into an agreement whereby the plaintiff as contractor agreed with the defendant as principal to undertake the construction of a sub-division, including but not limited to the civil works associated with the provision of roads, sewer, electricity and water, on the defendant's land at Broadford for the sum of $795,000. The agreement was a standard form contract, Standards Australia General Conditions of Contract AS 4000-1997 ("the contract"). Pursuant to cl.20 and the definition of "Superintendent" in cl.1 and item 5 of the contract, the superintendent appointed by the defendant was WBS Consultants Pty Ltd.
5 According to Mr Furnari, the plaintiff has carried out the works and, pursuant to cl.37.1 of the contract, made 12 progress claims for payment to the superintendent. Pursuant to cl.37.2 the superintendent has certified each of the 12 progress claims for payment. The defendant paid the first six progress certificates in the sum of $693,384.23, but did not pay anything in respect of progress claims numbers 7 to 12. The relevant progress certificates, which were dated between 29 October 2004 and 1 April 2005, totalled $456,978.98. Any argument about a lack of proof that the six outstanding progress certificates were received by the defendant was removed, in my opinion, by the admission by Mr Sabri in his affidavit that "the Superintendent has issued various progress certificates for the works carried out by Main Roads", without raising any suggestion that the defendant has not received all of them, and by a statement by the defendant's counsel that, apart from certain technical objections, no further point was taken about the sufficiency of the plaintiff's proof of the claim.
6 However, there still remains, in my opinion, an issue about whether the claim for interest has been proved. Pursuant to cl.37.2 of the contract the obligation of the defendant was to pay the amount certified "within 7 days after receiving" the progress certificate. There is no evidence before me of the dates on which the defendant received, or is deemed under cl.7 of the contract to have received, each of the six unpaid progress certificates. It is therefore not possible to fix a "date of default" for the purpose of calculating interest under cl.37.5 of the contract.
7 Therefore, it seems to me that at this stage the plaintiff has not verified the facts on which that part of its claim relating to interest is based. Nevertheless, apart from the technical objections mentioned by Mr Upjohn of counsel, who appeared for the defendant, the plaintiff has verified the facts on which the claim for payment of $456,978.98 is based.
8 The first of the technical objections was that not all of the contract was put into evidence because Mr Furnari did not exhibit all of the contractual documents. As Mr Furnari himself stated, the "Bill of Quantity pages numbered 1 to 15" and the "Numbered plans" were not produced. However, counsel for the defendant conceded that there was no argument which he wished to advance which was impeded by the lack of these contractual documents. Although it may have been preferable to exhibit all of the contractual documents, I do not consider that the plaintiff's application for summary judgment should be defeated by the omission of bulky and detailed documents and plans which were not relevant to any of the issues raised by the defendant. This is particularly the case where, as discussed below, the pleaded agreement was admitted by the defendant.
9 The second technical objection was that the best evidence rule was not followed because only photocopies of the contract, the progress claims and the progress certificates were exhibited. Again, counsel for the defendant conceded that nothing turned on this point. In my opinion, there is no substance in it.
10 It seems to me, therefore, that the plaintiff has made out a prima facie case that it would be entitled to summary judgment for the sum of $456,978.98, unless the defendant satisfies me that in respect of that part of the claim "a question ought to be tried or that here ought for some other reason be a trial of that claim or part" (r.22.06(1)(b) of the Supreme Court (General Civil Procedures) Rules 1996 ("the Supreme Court Rules").
11 The test for deciding whether or not it is appropriate to give the plaintiff summary judgment in respect of all or part of its claim is well established. The power to order summary judgment is one that should be exercised with great care and should never be exercised unless it is clear that there is no real question to be tried. If it is not possible to say without doubt on the whole of the material that there is no question to be tried, there should be leave to defend: Dey v Victorian Railway Commissioners[1]; General Steel Industries Incorporated v Commissioner for Railways (NSW)[2]; Fancourt v Mercantile Credits Ltd[3]. However, the summary judgment procedure is not confined to cases which are plain and obvious and the fact that a transaction is intricate does not disentitle a plaintiff to relief in a clear case. Even extensive argument may be necessary to show that there is no question to be tried: Australian Can Co Pty Ltd v Levin & Co Pty Ltd[4]; Dey v Victorian Railway Commissioners[5]; General Steel Industries Incorporated v Commissioner for Railways (NSW)[6].
12 I turn then to consider whether there should be leave to defend. On 5 July 2005 Samary had filed a defence which could only be described as a "holding" defence which did not comply with the rules governing pleading. Apart from admitting incorporation of the plaintiff and the defendant, that it owned certain land in Broadford and that Main Roads had lodged a caveat over the land, Samary simply denied every other allegation. However, pursuant to my order made on 19 August 2005, the defendant served an amended defence and counterclaim. This pleading still contained a number of bare denials, but in it the defendant did admit the agreement between the plaintiff and the defendant. It also contained allegations of breaches by the plaintiff of the agreement in respect of delay in achieving practical completion and a failure by the plaintiff to install a rising main, both of which were said to have caused the defendant loss and damage. The defendant also complained about the wrongful lodging by the plaintiff of two caveats, which although subsequently removed, allegedly caused further delay and forced the defendant to incur legal costs. Finally, the defendant alleged that the plaintiff published certain false statements about the solvency of the defendant which had caused it further loss.
13 In his affidavit Mr Sabri developed these complaints about the plaintiff's performance. He produced invoices said to total $91,930.35 for the cost of maintenance and rectification works which the plaintiff had allegedly failed to carry out. He also produced a quotation for the installation of the rising main in the sum of $340,000, which was said to be $175,000 more than the price for which the plaintiff had agreed to do this work. Mr Sabri said that this quotation had not been accepted by the defendant because he considered it to be too high.
14 Mr Sabri deposed that the principal area of damage sustained by the defendant arose as a result of the plaintiff's failure to bring the works to practical completion within the stipulated contract period and as a result of the further delays caused by the plaintiff's wrongful lodging of the caveats. Under the contract, the date for practical completion was 30 August 2004, being 80 days from the contract date. This was apparently extended to 12 November 2004, but practical completion was not achieved until 13 May 2005, according to the certificate of practical completion issued by the Superintendent, which was exhibited to Mr Furnari's affidavit.
15 The wrongful lodging of the caveats, according to Mr Sabri, delayed the registration of the Plan of Subdivision which meant that various pre-subdivision contracts of sale could not be settled. Three such contracts were cancelled by the purchasers by reason of the inability of the defendant to achieve registration of the Plan of Subdivision within the agreed period. It was also said that the delay in completing the rising main was holding up the issue of titles for five lots as Goulburn Valley Water would not certify the subdivision until the rising main was completed.
16 Mr Sabri deposed that these delays had resulted in the defendant suffering losses because holding costs of $15,000 per month had been extended allegedly by 14 months, land prices had fallen and the market had changed (which meant that the defendant might now have to incur extra expense by constructing houses to encourage sales interest), and extra legal costs had been incurred. In addition, the defendant had incurred legal costs of $29,160.57 in relation to the removal of the caveats.
17 Finally, Mr Sabri claimed the plaintiff's defamatory statements about the defendant's solvency had caused contractors to inflate their quotations for carrying out the remaining works for stages 2 and 3 of the development. These new quotations were far in excess of the cost of stage 1. For example, the cost of basic works for stage 1 of $40,000 per lot were now being quoted at $55,000 per lot.
18 Although it was not explicitly stated by Mr Sabri, the purport of his affidavit was that the defendant arguably had set-offs or counterclaims in excess of the plaintiff's claim. The plaintiff disputed the way in which the defendant raised these issues and made its calculations. It denied, therefore, that the set-offs or counterclaims provided a complete, or even any substantial, defence. However, Mr Dixon of counsel, who appeared for the plaintiff, submitted that it was unnecessary to explore the strengths and weaknesses of the defendant's case that it had sufficient set-offs or counterclaims to justify the matter going to trial on all issues. This was because, Mr Dixon submitted, the parties had, by their contract, excluded the ordinary right of set-off, other than in accordance with the contract, so that the defendant was bound by the contract to pay the amount of each progress certificate without any deduction.
19 Before considering the parties' submissions it is helpful to set out the relevant provision of the contract. Clause 37 which is headed "Payment" reads as follows: