BIS Cleanaway (trading as Chep) v Tatale - [2007] NSWSC 378

CITATION: BIS Cleanaway (trading as CHEP) & Ors v Tatale & Anor; Brambles (trading as CHEP) v Tatale & Anor [2007] NSWSC 378

HEARING DATE(S): 12-16 March and 19 March 2007

JUDGMENT DATE :
2 May 2007

JURISDICTION: Commercial List

JUDGMENT OF: McDougall J at [1]

DECISION: See paras [134] to [138] of judgment

CATCHWORDS: CONVERSION AND DETINUE - where pallets bailed pursuant to terms of hire that reserve right of immediate possession to bailor at all times - whether bailor entitled to return of pallets on demand without terminating hire agreement - where bailee gives possession of pallets to stranger - whether bailor entitled to return of pallets on demand without terminating hire agreement between it and bailee - ius tertii - whether stranger can set up bailee's right of possession against bailor - whether warranty of quiet enjoyment implied by TPA s 69(1)(b) defeats bailor's claim to possession as against stranger - INJUNCTION - whether bailor entitled to mandatory injunction for delivery up of pallets - whether such an order can be made where pallets are not uniquely identifiable - whether such order can be made where pallets are fungible or interchangeable - CONTRACT - novation - offer and acceptance - where bailees notified of intention to novate bailor's obligations - whether acceptance of novation can be inferred from bailees' conduct - STAMP DUTIES - written offers orally accepted for transfer of title to and rights to use pallets - whether goodwill of pallet hire business assigned together with right to use pallets and associated equipment and technology - whether transfer of title to and right to use pallets includes transfer of goodwill relating to their use in business - whether transfer of "dutiable property" -

LEGISLATION CITED: Civil Procedure Act 2005
Duties Act 1997
Evidence Act 1995
Fair Trading Act (NSW)
Trade Practices Act 1974

CASES CITED: Aristoc Industries Pty Ltd v R E Wenham (Builders) Pty Ltd (1965) NSWR 581
Brambles Holdings Ltd v Bathurst City Council (2001) 53 NSWLR 153
Butler v Hobson [1838] 4 Bing. N.C. 290
Commissioner of Taxation of the Commonwealth of Australia v Murry (1998) 193 CLR 605
Doulton Potteries Ltd and Another v Bronotte (1971) 1 NSWLR 591
Edwin Hill & Partners v First National Finance Corp plc (1989) 1 WLR 225
Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523
Felthouse v Bindley (1862) 11 CB (NS) 869
Henry Berry & Co. Pty. Ltd v Rushton [1937] St. R. Qd. 109
Integrated Computer Services Pty Ltd v Digital Equipment Corp (Aust) Pty Ltd (1988) 5 BPR 11
Jelks v Haywood [1905] 2 KB 461
Kahler v Midland Bank Limited [1950] AC 24
McKeown v Cavalier Yachts Pty Ltd and Another (1988) 13 NSWLR 303
North General Wagon & Finance Co Limited v Graham [1950] 2 KB 7
Olsson and Another v Dyson (1969) 120 CLR 365
Reliance Car Facilities Limited v Roding Motors Limited [1952] QB 844
Scarf v Jardine [1882] 7 App Cas…

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: [2007] NSWSC 378
Decision Date: 2 May 2007

CaseChat Overview and Summary

BIS Cleanaway (trading as Chep) filed an action against Tatale concerning the return of pallets under a hire agreement. The parties disputed the terms of the bailment, particularly the bailor's right to reclaim the pallets at any time. The case was heard in the Supreme Court of New South Wales. The key issues involved whether the bailor could demand the return of the pallets without terminating the hire agreement, especially when the bailee handed the pallets over to a third party. Additionally, the court examined whether the third party could assert the bailee's rights against the bailor and whether the bailor's claim to possession was negated by an implied warranty of quiet enjoyment under the Trade Practices Act. Another significant issue was whether the bailor could obtain a mandatory injunction for the return of the pallets, even if they were not uniquely identifiable or fungible. The case also delved into the potential novation of the bailment agreement and whether the acceptance of such novation could be inferred from the bailees' actions. Lastly, the court had to determine if the transfer of title and usage rights to the pallets constituted a transfer of the associated business goodwill and whether it triggered stamp duty obligations.

The court held that the bailor retained the right to reclaim the pallets at any time, which superseded the bailee's possession, even if the pallets were handed to a third party. The court found that the third party could not assert the bailee's rights against the bailor, and the implied warranty of quiet enjoyment did not defeat the bailor's claim to possession. The court ruled that a mandatory injunction could be granted for the return of the pallets, even if they were not uniquely identifiable or fungible. Regarding the novation, the court determined that the bailees' conduct did not imply acceptance of the novation of the bailment agreement. Finally, the court concluded that the transfer of title and usage rights to the pallets did not include the transfer of the associated business goodwill, and thus, no stamp duty was applicable to this transaction.

Orders