Ansell v Wells

[1982] FCA 186

Re: RONALD WILLIAM LEO; EILEEN MARY LEO; NORMA GREEN and NORMA GREEN and TREVO
JAMES GREEN as executors of the estate of Raymond Oliver Green, deceased
And: BRAMBLES HOLDINGS LIMITED (1982) 65 FLR 310
No. QLD G4 of 1979
Trade Practices Act

COURT

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
Fitzgerald J.(1)

CATCHWORDS

Trade Practices Act - Consumer Protection - Misleading and deceptive conduct - carrier stating wrong height of vehicle in Application for Permit under State Traffic Regulations - collision of vehicle with overhead bridge - whether loss casually connected with mis-statement - whether matters would have taken a different course in the absence of the mis-statement.

Trade Practices Act - Consumer Protection - Misleading and deceptive conduct - whether the non-disclosure of an inaccurate statement can constitute misleading conduct.

Constitution Law - repugnancy between State and Commonwealth legislation - State Act purporting to limit damages recoverable under Commonwealth legislation - implied contractual term fixing maximum damages.

Damages - Quantum of damages - loss of taxation benefit in respect of investment allowance.

Trade Practices Act, 1974, ss. 4(2), 52(1), 53(aa), 53(c), 82

Traffic Regulations (Qld)

Carriage of Goods by Land (Carriers' Liabilities) Act 1967 (Qld), s.9

Commonwealth of Australian Constitution, s.109

Income Tax Assessment Act, 1936

Trade Practices - Consumer protection - Misleading and deceptive conduct - Agreement for carriage of equipment - Loaded vehicle height misstated in permit application and permit - Damage to equipment in transit - Loss or damage - Trade Practices Act 1974 (Cth), ss. 4(2), 53(1), 82.

HEADNOTE

The respondent agreed to transport earthmoving equipment for the applicants and made application to the police for a permit to do so. The respondent's application stated a route which included passage under an overbridge but misstated the loaded height of the equipment on the respondent's vehicle. A permit was issued in the terms of and in consequence of the statements in the application. The first applicant observed the description of the route in the permit. In the course of transit the equipment on the respondent's vehicle struck the overbridge and was damaged. The applicants asserted that the respondent had, in trade or commerce, engaged in conduct that was misleading or deceptive or was likely to mislead or deceive, contrary to s. 52(1) of the Trade Practices Act 1974 and sought to recover the loss and damage pursuant to s. 82.

Held, that the first applicant did not relate the permit, or anything in it, to the suitability of the route relative to the loaded height of the respondent's vehicle, nor would he have done so had his attention been drawn to the inaccuracy.

HEARING

Brisbane, 1982, July 26, 28-29; August 6. #DATE 6:8:1982

APPLICATION.

The facts appear in the judgment.

D.K. Derrington Q.C. and D.G. Russell, for the applicants.

D.P. Drummond Q.C. and J.H. Byrne, for the respondent.

Cur. adv. vult.

Solicitors for the applicants: W.R. Scott & Scott.

Solicitors for the respondent: Clayton & Co.

H.W. FRASER

ORDER

1. The Application is dismissed.

2. The Applicants pay the Respondent's costs of and incidental to the Application, including reserved costs if any. Application dismissed.

Applicants to pay respondent's costs including reserved costs.

JUDGE1

The original applicants in these proceedings which were commenced on 31 July 1979, were Mr and Mrs Leo and Mr and Mrs Green ("the applicants"). At all material times until 28 February 1982, the applicants carried on business as equal partners in a business which involved the use of earth-moving equipment. They had no partnership agreement. Mr Green died on 28 February 1982 and by consent, his legal personal representatives have been substituted as a party. It is not in dispute that, at all material times, the respondent was a corporation within the meaning of the Trade Practices Act, 1974 ("the Act"), or that, in conducting its business as a carrier, it engaged in trade and commerce. The original claim was to recover under s.82 of the Act loss said to have been suffered by alleged contraventions by the respondent of ss. 52(1), 53(aa) and 53(c). As is not uncommon, reliance upon s.53 was abandoned, as adding nothing, in the course of final addresses.

Some 10 months prior to March 1979, the applicants had ordered a Caterpillar 998B wheeled front-end loader from Hastings Deering Pty Ltd. The price payable was fixed at $220,000. The end-loader became available for delivery early in March 1979. On a number of previous occasions, the respondent had transported earth-moving equipment for the applicants. In telephone conversations on 5 and 6 March 1979 with Mr C.C. O'Brien, the relevant employee of the respondent, one of the applicants, Mr Leo, arranged for the respondent to transport the equipment early on the morning of 7 March 1979 from the premises of Hastings Deering at Kerry Road, Archerfield to an open-cut mine at Swanbank where it was to be used. A Permit in respect of the transportation was required from the Superintendent of Traffic, Brisbane, under the Traffic Regulations, 1962 (Qld). It was for the respondent to obtain the Permit. Mr O'Brien was not called. I accept the evidence of Mr Leo that Mr O'Brien stated that he would be obtaining the Permit and that Mr Leo described the equipment which the applicants required transported as a "998B Loader". The height of such a loader was 13'6" and the tray of the respondent's vehicle which was required to carry the loader was approximately 2'6" from the ground. Accordingly, the distance from the ground to the highest point on the end-loader when on the respondent's vehicle was approximately 16 feet.

On 6 March 1979, the respondent applied to the Superintendent of Traffic, Brisbane, for a Permit in respect of the transportation of the end-loader. The Application was made on the respondent's behalf by an employee, one Higgins. Mr Higgins was not called. No explanation was given why the Application specified the loaded height of the respondent's vehicle when carrying the applicants' end-loader as 14 feet, or why it described the route to be followed as "from Hastings Deering, Archerfield, to Swanbank Power Station . . . via the following roads - Kerry, Beatty, Granard, Ipswich, Boundary Rds.". The final stage of the journey involved passage down South Station Road, and no occasion arose to travel on any road named Boundary Road. Further, the road required to be traversed between Granard Road and South Station Road is named Ipswich Road only as far as Gailes. Thereafter, for so far as is material, it is correctly named the Cunningham Highway, although commonly still called Ipswich Road. Between Archerfield and the junction of the Cunningham Highway with South Station Road, there is a bridge which leads to the Warrego Highway over a section of the Cunningham Highway (or Ipswich Road as it is called). That bridge is 15'8" above the roadway at its lowest point. It is possible to avoid travelling (or attempting to travel) under the bridge by a quite minor deviation. In an answer to an interrogatory (Exhibit 16), the respondent said that, at the time he made what was clearly an inaccurate statement as to the loaded height of the vehicle in the Application, Mr Higgins "had knowledge as to its accuracy or otherwise". Since Mr Higgins was not called, there was no evidence that that answer was mistaken, or any explanation as to why Mr Higgins made a statement in the Application knowing it to be inaccurate as the answer suggests. In answer to the same interrogatory, the respondent acknowledged that Mr Higgins was its agent for the purpose of completing the Application. The apparent effect of the answer is that, by its own admission, the respondent knew that the statement which it made as to the loaded height of its vehicle in the Application was inaccurate.

The respondent submitted that the Application to the Police Department was not made "in trade or commerce" within the meaning of the Act. Whilst I doubt the correctness of the submission, I have found no need to form a concluded view. Nor, as at presently advised, would I accede to the further submission that, before damages can be recovered under s.82 of the Act in consequence of a contravention of s.52(1), it must be established that the party seeking damages relied on the conduct which constituted the contravention. It may well be possible to establish otherwise a causal connection between a contravention and loss.

On the day on which the Application was made by the respondent, a Permit was issued, signed by a police constable. The Permit was relevantly identical with the respondent's Application.

On the evidence available, it has not been an easy task to discern what, if any, relationship existed between the form of the Permit and a belief in the mind of the police constable at the time at which she issued it that the loaded height of the respondent's vehicle was less than the height of the overbridge, or whether any such belief was occasioned by the statement in the respondent's Application that the loaded height of its vehicle would be 14 feet. I am not satisfied that the police constable turned her mind to the particular route specified, or to the overbridge or the clearance under it, or that she formed a belief that the respondent's loaded vehicle was 14 feet in height or could pass under the overbridge, let alone that she did so in reliance upon the statement as to the height of the loaded vehicle which was made in the respondent's Application. Insofar as she made any decision that the route designated in the Application was safe and suitable, she seems simply to have placed general reliance upon the respondent, an established carrier, and its employee. I am not convinced that she did more than assume that their choice of a route would be appropriate. Evidence by the police constable as to statements made to her by the employee of the respondent who made the Application, which arguably "warranted" the route, was beyond the scope of the applicants' pleaded case and was unconvincing.

Reference has been made to the minor deviation by which attempted passage under the overbridge might have been avoided. Evidence was adduced of other Permits, also relating to loaded vehicles unable to pass under the overbridge, which were not materially different from the Permit issued to the respondent in respect of its transportation of the applicants' end-loader. Nonetheless, in my opinion, that Permit did not provide for travel around the overbridge, but under it.

The applicants pleaded in paragraph 9 of the final version of the Statement of Claim that the practice of the "Traffic Authority" was "to the knowledge of the applicants and the respondent" to prescribe a route which was "such as to avoid . . . damage by reason of the height of the load". No evidence was led which established any such practice. The respondent called Sgt. Lovegrove, the officer-in-charge of the Permit Section of the Traffic Branch of the Queensland Police Department in Brisbane. His evidence indicated that, in practice, his Section often relied upon applicants for Permits and the common sense of the drivers of the vehicles to ensure the suitability of routes.

There is no doubt that the police constable adopted the contents of the Application in the Permit, and that the terms in which the Permit was issued were a direct consequence of corresponding statements in the Application. I find that the description of the route in the Application led to that route being prescribed by the Permit. However, the applicants did not plead, and I did not understand them to submit, that the description of the route which was contained in the Application was false or misleading or deceptive or likely to mislead or deceive. However inappropriate the route described in the Application, it was no more than an Application. There seems no basis upon which the statement as to the proposed route in the Application, which might have been refused or granted in respect of a different route, could be characterized as a mis-statement or a misrepresentation.

I also find that no connection existed between the mis-statement in the Application as to the loaded height of the respondent's vehicle and the route which was prescribed by the Permit. However, I find that the mis-statement in the Application as to the loaded height of the respondent's vehicle led to the same error concerning that matter in the Permit.

Mr Leo went to Hastings Deering's premises in Kerry Road, Archerfield at about 5 a.m. on 7 March 1979, for the purpose of accompanying in his own vehicle the transportation of the end-loader on the respondent's vehicle. The driver employed by the respondent, a Mr Grant, was in the process of loading the end-loader onto the respondent's vehicle when Mr Leo arrived. Mr Grant was not called to give evidence. Mr Leo said, and I accept his evidence, that a discussion took place between Mr Grant and a policeman who was to escort the respondent's vehicle on his motor cycle. The conversation related to the route to be followed, more particularly to the reference in the Permit to Boundary Road, and Mr Leo joined in with an assurance that the path into Swanbank was via South Station Road, and an offer to lead the way. In the course of the discussion, Mr Leo observed the route described on the Permit which had been produced by Mr Grant to the policeman, but not the mis-statement that the loaded height of the respondent's vehicle was 14 feet. The respondent did not tell Mr Leo that the Application had contained, and the Permit did contain, an inaccurate statement as to the loaded height of the respondent's vehicle.

The journey was undertaken and, inevitably, the end-loader on the respondent's vehicle struck the overbridge and was damaged. At the relevant time, Mr Leo was not being followed by the respondent's vehicle and it was not suggested that he could be blamed in any way.

Neither party called the escorting policeman and it was not asserted that he was influenced in any way by any alleged contravention of sub-s. 52(1) by the respondent. However, the applicants asserted that, but for the production of the Permit and/or the non-disclosure of the mis-statement in it and the Application, Mr Leo would not have permitted the transportation to take place.

The conduct of the respondent relied on by the applicants as a contravention of sub-s. 52(1) of the Act consisted of all or some of the following elements:

(i) the inaccurate statement as to the loaded height of the respondent's vehicle in the Application for Permit;

(ii) the production to Mr Leo of the Permit containing the inaccurate statement as to the loaded height of the respondent's vehicle and the description of a route which provided for passage under the overbridge;

(iii) the non-disclosure to Mr Leo of the inaccurate statement as to the loaded height of the respondent's vehicle in the Application and the Permit.

A question was raised by the respondent as to whether the non-disclosure of the inaccurate statement as to the loaded height of the respondent's vehicle constituted conduct of the respondent for the purpose of sub-s. 52(1) of the Act. Sub-section 4(2) relevantly provides that in the Act:
"(a) a reference to engaging in conduct shall be read as a reference to doing or refusing to do any act . . . ;
(b) . . .
(c) a reference to refusing to do an act includes a reference to -
(i) refraining (otherwise than inadvertently) from doing that act;
. . . ".

The applicants' Statement of Claim alleged a failure, not a refusal, on the part of the respondent to inform the applicants of mis-statements and neither pleading used the language of sub-s. 4(2) of the Act, i.e. "refusing", "refraining" or "inadvertently". There was some debate in the course of the hearing concerning the relevance of the respondent's mental state but only in relation to the mis-statements in the Application, not the non-disclosure of the inaccuracy to Mr Leo. Despite Exhibit 16 and its failure to call any of its employees as witnesses, Counsel for the respondent, who addressed first, raised sub-s. 4(2) in the context in which I have already indicated. I would have found it extremely difficult to conclude, in the circumstances, that the non-disclosure could not be brought to account, even in conjunction with other matters such as the production of the Permit to Mr Leo, in assessing whether the respondent contravened sub-s. 52(1).

Even so, in my opinion, the applicants are not entitled to the damages claimed in these proceedings. They failed to satisfy me that it was the relevant conduct of the respondent, i.e. conduct contravening sub-s. 52(1) as distinct from negligent conduct, which led to their loss.

Mr Leo took no notice of the statement in the Permit that the height of the respondent's loaded vehicle was 14 feet, and it would have had no significance for him had he noted it. He observed the route described in the Permit, but, except for the reference to Boundary Road, it simply confirmed a route that was well-known to him. He gave no evidence suggesting that he knew the clearance under the material overbridge or would have known that the respondent's loaded vehicle could not have passed under it had only he known that the height of the respondent's loaded vehicle was not 14 feet, or had he known its true height. I do not accept that he related the Permit, or anything in it, to the suitability of the route relative to the loaded height of the respondent's vehicle, or that he would have done so had his attention been drawn to the inaccuracy. Whilst I was generally disposed to accept his testimony, I found it confusing and unconvincing on this aspect of the matter. Had Mr Grant said when the Permit was produced in the course of discussion of the route - "The loaded height of the vehicle is 16 feet, not 14 feet as stated there in the Permit. The wrong figure was put in the Application." - I do not consider that Mr Leo would have acted any differently. Rather, in my view matters would have taken exactly the same course.

In the circumstances, it is unnecessary for me to deal at length with the defence raised by the respondent in the following terms in paragraphs 13 - 16 of its Amended Defence:
"13. Further, or alternatively, by s.9 of the Queensland Carriage of Goods by Land (Carriers' Liabilities) Act of 1967 there is deemed to be incorporated into the contract admitted in paragraph 3 of this Defence the provisions of Sections 5(3) and 6(1) of that Act.

14. The Applicant was at all material times a "consignor" within the meaning of that expression in S.6(1) of the said Act in respect of the end loader mentioned in the Statement of Claim.

15. Before the time of delivery to the Respondent of the said end loader the Applicant did not:-

(a) Give to the Respondent a statement in writing declaring the nature and value of the goods to be carried pursuant to the said contract;

(b) Receive from the Respondent its acceptance in writing of the consignment in question specifying the nature and value so declared and the Respondent's acceptance of "increased risk thereof" within the meaning of that expression in the said S.6(1).

16. In the premises, if (which is denied) the Respondent is liable to the Applicant in any amount, any such liability does not exceed $20.00 or, alternatively, $200.00."

My tentative view is that any such defence would fail. If the State Act would, if valid, limit the damages recoverable under s.82 of the Trade Practices Act, either directly or by the importation of a term into the contract between the parties, as pleaded, it would not be easy to avoid a conclusion that it conflicts with s.82. If it does, it is pro tanto invalid by virtue of s.109 of the Constitution.

The respondent did not dispute that, if it was liable to pay damages, the applicants' loss as owners of the damaged end-loader was the aggregate of the amounts claimed in the Statement of Claim with the exception of the amount claimed in paragraph 21(e), which had been first included by an amendment made at the trial. That sub-paragraph claims the sum of $13,065.00 as -
"Loss of taxation benefit in respect of investment allowance . . . ".
Although there was no further change to the form in which that claim was expressed in the final version of the Statement of Claim, the applicants' ultimate position was that each of Mr and Mrs Leo and Mrs Green claimed for himself or herself as a personal loss one quarter of the sum mentioned. No similar claim was made on behalf of the estate of the late Mr Green. Apart from denying liability, the respondent's opposition to what the applicants sought under paragraph 21(e) was confined to contending that the evidence did not support the individual losses alleged. No submission was made that the claim for such losses was out of time by virtue of s.82(2) of the Act or otherwise, or that such losses, if proved, are not recoverable under s.82(1).

In broad terms, the alleged losses related to taxation disadvantages allegedly sustained by the partnership comprising the applicants when the damaged end-loader was sold and a further new end-loader was purchased soon after the accident. No account seemed to be taken of any taxation advantages which accrued to the partnership. The effect of what was said was that the size of the partnership's loss for taxation purposes in the period was reduced and that, accordingly, each of the partners was deprived of a taxation benefit which could have been carried forward. The evidence was that, as yet, the absence of that benefit has been of no consequence. Mr Leo said, however, that the applicants have or soon will have a taxable income. The argument for the applicants was that, at that point, the lost taxation benefit will be of significance. All else aside, I do not accept Mr Leo's assertion. This whole claim seemed to me founded too much on what could not be other than speculation.

For the reason I have given, the claim fails. The application is dismissed, with costs, including any reserved costs.