So, what’s new? Of course, I mean no disrespect to the judge in question personally.
In 2007, Leduva, whose appearances in the courts I have noticed on this blog before, engaged Mr Mr Nader Mohareb to undertake some consulting work for them as a structural engineer in relation to a project Leduva was undertaking in Hurstville.
Mr Mohareb said that the terms of the engagement were governed by the written terms (dated 13 April 2007) he (or, to be precise, his company) provided Leduva prior to their engaging him (to be precise, engaging the company); Leduva said he was retained on a different basis, apparently some kind of trial basis to establish his expertise and competence.
Leduva changed architects. Mr Mohareb said that he had done work based on the plans provided by the first architects, and that he had then done extra work as a result of the changes by the second architect, and that he was entitled to charge extra for this work at an hourly rate as set out in his written terms. An invoice was sent to this effect on 13 February 2008.
Shortly after, Leduva terminated Mr Mohareb’s company’s retainer.
Mr Mohareb said that his terms of service (in a manner which common in contracts for personal services and employment though less common for engagement of a consultant) provided that if his retainer was terminated, he was in effect entitled to serve out a 60-day period or to be paid in effect in lieu of notice based on an assessment of the work which, had he served the 60-day period, he would have done in this time.
It is difficult to be precise about the figures, but as far as I can make out Mr Mohareb claimed he was owed $40-something-K for the work he had done (including the extra work) and twenty-something $K under the payment in lieu of notice. The total was about $68K. Mr Mohareb gave up his claim to any amount over $60K and commenced proceedings against Leduva in the Local Court (whose jurisdiction limit is $60K).
Leduva of course said that the terms of service did not apply (and also made other complaints about Mr Mohareb’s work) but also said that such a term of service was unenforceable as being not a fair estimate of Mr Mohareb’s loss and therefore a penalty (that’s a slightly specialized area so I won’t try to go any more deeply into that here) and hence unenforceable.
Mr Nohareb said that within the 60-day period he would have finished the job so that one way or another, as a combination of work already done and work which he would have done he was entitled to the full price for the job, plus, that is, the extra price for the extra work.
The case was heard over 4 days of trial (there will have been prior court mention dates) in March and August 2009 (ie, about a year after the termination of Mr Mohareb’s retainer and non-payment of his claim). There were further submissions, judgment was reserved, and finally delivered in February 2010 with further orders made in April. It was in Mr Mohareb’s favour. Along the way the magistrate expressed an unfavourable view about the Messrs Taouk, the witnesses for Leduva:
(a) “I found both the Taouks not to be credible witnesses” (T 9.38 – 26 February 2010);
(b) “Mr Amerr Taouk’s evidence was at times just not believable. He was hesitant and evasive when answering questions …” (T 9.39-.40 – 26 February 2010);
(c) “… the Taouks are not naïve businessmen and at no stage … was there documentation saying otherwise than what the [plaintiff] says happened” (T 10.26 – 26 February 2010);
(d) “Mr Mohareb was unshaken in cross-examination and impressed as a witness of truth. Where there is conflict in the evidence between the plaintiff and the defendant … I will accept the evidence of the plaintiff” (T 9.48-T 10.01 – 26 February 2010). I should note that in this extract the plaintiff to whom the Magistrate was referring was NM. [that is a reference to the company]
Undeterred by this, Leduva appealed to the Supreme Court.
The appeal was heard by Justice Garling on 13 October 2010 and judgment was handed down by him on 22 October 2010.
His Honour dismissed the appeal: that is, he upheld the decision of the magistrate in Mr Mohareb’s favour.
Then his honour remarked:
134 The parties, who were engaged in mutual commercial activities over two and a half years ago, have now engaged in litigation over a relatively small sum of money (ie $60,000). The Local Court has devoted four days to the hearing of the matter. The learned Magistrate has devoted additional time to the consideration of submissions and the preparation of a judgment. She accepted the case contended for by NM and rejected, largely on the unchallenged grounds of credibility and demeanour, the case contended for by Leduva. Leduva has sought to appeal against that judgment to the Supreme Court which has heard all of the arguments on its appeal, and rejected them. It cannot be said that either of the parties has not had the full benefit of the system of justice which the State provides, and to which they are entitled. The legal costs must now exceed, or else go close to exceeding the sum originally in issue.
135 This case serves as a good example of the benefits which would enure to parties who engage in alternative dispute resolution by means such as mediation.
I am surprised at such a remark by a judge who has found so comprehensively in favour of one party when the circumstances suggest a very determined defence by Leduva, ultimately unsuccessful, including by evidence which was not believed, in an industry where the tough-minded refusal of payment on any range of pretexts is so endemic that at least for building contractors there is now a statutory regime for security of payment. It is far from clear that mediation offered any advantages to Mr Mohareb.
Enough with this “the parties.” I know there is a temptation for judges to regard the warring parties before them as children who should just manage to patch up their own disputes and in some sense both equally to blame for the existence of the dispute, but in this case I think his Honour could have spared Mr Mohareb any such implied rebuke or, if not quite a rebuke, sermonizing.
Afterthought 2016: after following Mr Mohareb’s subsequent litigious adventures, now I am not quite so sure.