AWB Riskassist Limited v Daryl Barlow - [2011] VSC 258

IN THE SUPREME COURT OF VICTORIA

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

COMMERCIAL COURT

LIST A
No. 9660 of 2009

AWB RISKASSIST LTD	Plaintiff
v
DARYL BARLOW	Defendant

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JUDGE:	Pagone J
WHERE HELD:	Melbourne
DATE OF HEARING:	23-26, 30 May 2011
DATE OF JUDGMENT:	16 June 2011
CASE MAY BE CITED AS:	AWB Riskassist Limited v Daryl Barlow
MEDIUM NEUTRAL CITATION:	[2011] VSC 258

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CONTRACT – Terms – Whether contract permitted roll over – Representations made about the terms – Subjective belief of a party – Counterclaim for loss flowing from breach – Affirmative case needed to establish what would have occurred.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr J Evans	Lander & Rogers
For the Defendant	Ms G Preston	HWL Ebsworth Lawyers

HIS HONOUR:

The central dispute in this proceeding was the identification of the terms upon which AWB Riskassist Ltd (“Riskassist”) contracted with Mr Barlow for him to take positions under futures contracts in respect of the delivery of wheat in November 2007. Riskassist contended that four contracts were made by which Mr Barlow took futures positions to be closed-out prior to 28 November 2007. Mr Barlow did not close-out the futures positions and Riskassist claimed the sum of $1,232,374.02 on the four contracts plus interest of $409,272.59 to 23 May 2011. Mr Barlow contended in answer to the claims that the terms of the contract he had with Riskassist permitted him to reset or roll the futures contracts and that Riskassist wrongfully refused to do so. On that basis Mr Barlow counterclaimed for the amount he maintained was the loss flowing from the breach alleged against Riskassist.

There is no doubt that the parties intended to contract. The parties acted and conducted themselves upon the basis of legal relations having been created between them. The problem in this proceeding was that of determining the terms upon which they intended to do so. The problem in part arose from what may have been a lack of care on the part of Riskassist. Mr Barlow had been given a product disclosure statement and some other documents but did not receive all of the documents upon which Riskassist would ordinarily contract with a person such as Mr Barlow. Riskassist did have formal contract documents which included four attachments setting out, amongst other things, its general terms and conditions and a product supplement and a dictionary. The formal documents and attachments could have formed the basis upon which the parties might have contracted had the documents been supplied to Mr Barlow. In fact, however, none of the attachments were ever received by Mr Barlow and a written document expressed to be a contract (but without the attachments) was only given to Mr Barlow on two occasions. In the event, the parties were contracting with each other by reference only to the product disclosure statement and, perhaps, by reference to such representations as may have been made to Mr Barlow by employees and agents of Riskassist.

It is, therefore,…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2011] VSC 258
Decision Date: 16 June 2011

CaseChat Overview and Summary

The Federal Court of Australia was asked to determine whether AWB Riskassist Limited was entitled to roll over a contract between the parties and whether the company was entitled to damages flowing from a breach of the contract. The case involved a dispute between AWB Riskassist Limited, a company that provides insurance to farmers, and Daryl Barlow, a farmer who had taken out a crop insurance policy with the company. The dispute centred on the terms of the insurance policy, specifically whether it permitted a roll over and whether the company had breached the contract by failing to honour the roll over.

The legal issues before the court were whether the insurance policy permitted a roll over, and if so, whether the company had breached the contract by failing to honour the roll over. The court had to consider the terms of the insurance policy and the representations made by the company to the farmer, as well as the subjective belief of the farmer about the terms of the policy. The court also had to consider the counterclaim for loss flowing from the breach of contract and whether the farmer had established an affirmative case to show what would have occurred if the roll over had been permitted.

The court held that the insurance policy did not permit a roll over, and that the company had not breached the contract by failing to honour the roll over. The court found that the representations made by the company to the farmer did not amount to a promise that the roll over would be permitted, and that the farmer's subjective belief about the terms of the policy was not relevant. The court also found that the farmer had not established an affirmative case to show what would have occurred if the roll over had been permitted, and therefore his counterclaim for loss flowing from the breach of contract was unsuccessful.

The court dismissed the farmer's claim and ordered him to pay the company's costs of the proceeding. The court held that the insurance policy did not permit a roll over, and that the company had not breached the contract by failing to honour the roll over. The court found that the representations made by the company to the farmer did not amount to a promise that the roll over would be permitted, and that the farmer's subjective belief about the terms of the policy was not relevant. The court also found that the farmer had not established an affirmative case to show what would have occurred if the roll over had been permitted, and therefore his counterclaim for loss flowing from the breach of contract was unsuccessful. The court held that the farmer's claim was without merit and ordered him to pay the company's costs of the proceeding.

Orders