Blain v Blain Dairying Pty Ltd as trustee of the Blain Trading Trust
[2025] VCC 451
•15 April 2025
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMERCIAL DIVISION | Revised Not Restricted Suitable for Publication |
GENERAL LIST
Case No. CI-22-00261
| DARIN WILLIAM BLAIN | First Plaintiff |
| and | |
| SALLY LOUISE BLAIN | Second Plaintiff |
| v | |
| BLAIN DAIRYING PTY LTD AS TRUSTEE OF THE BLAIN TRADING TRUST (ACN 139275862) | First Defendant |
| and | |
| CRAIG ANDREW BLAIN | Second Defendant |
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JUDGE: | HIS HONOUR JUDGE MACNAMARA | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 6-8, 11-15, 18-22, 25-26 November 2024; 3-6 February and 14 March 2025 | |
DATE OF JUDGMENT: | 15 April 2025 | |
CASE MAY BE CITED AS: | Blain & Anor v Blain Dairying Pty Ltd as trustee of The Blain Trading Trust & Anor | |
MEDIUM NEUTRAL CITATION: | [2025] VCC 451 | |
REASONS FOR JUDGMENT
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Subject:Dispute between joint venturers
Catchwords: Joint venture dispute – Whether document styled “Farming Agreement” creating obligations between joint venturers – Whether signatures of plaintiff joint venturers forged – Disputes as to return of plaintiffs’ plant and equipment used during joint venture at conclusion of joint venture – Whether defendant joint venturer misused plaintiffs’ plant and equipment and is therefore liable for replacement – Whether defendant joint venturer liable after conclusion of joint venture for repairs and replacement of plaintiffs’ plant and equipment used during joint venture – Liability of defendant joint venturer to pay rent for out paddocks used during dairy farm joint venture – Whether defendant joint venturer liable to ensure that plaintiffs’ farm property “no worse off” in condition at conclusion of joint venture than at commencement – Competing claims in detinue for derelict car wrecks and other automotive equipment – Counterclaim for damage allegedly suffered by reason of exclusion of defendant joint venturer from harvest of silage on plaintiffs’ out paddock – Counterclaim as to proper allocation of milk cheque at conclusion of joint venture – Defendants’ counterclaim for return of certain items of plant and equipment – Whether certain items of plant are fixtures or chattels
Legislation Cited: Acts Interpretation Act 1901 (Cth);
Civil Procedure Act 2010 (Vic);
Corporations Act 2001 (Cth);
Evidence Act 2008 (Vic);
Limitation of Actions Act 1958 (Vic);
Partnership Act 1958 (Vic);
Penalty Interest Rates Act 1983 (Vic)
Water Act 1989 (Vic);
Cases Cited:Anglo-Scottish Beet Sugar Corporation Ltd v Spalding Urban District Council [1937] 2 KB 607;
BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266;
Briginshaw v Briginshaw (1938) 60 CLR 336;
Browne v Dunn (1893) 6 R 67;
Byrne v Australian Airlines Ltd (1995) 185 CLR 410;
Coggs v Bernard (1703) 2 Ld Raym 909;
Fitzgerald v Masters (1956) 95 CLR 420;
Howes v Miller [1970] VR 522;
Kay’s Leasing Corporation Pty Ltd v CSR Provident Fund Nominees Pty Ltd [1962] VR 429;
Landale v Menzies (1909) 9 CLR 89;
Moore v Dimond (1929) 43 CLR 105;
National Australia Bank Ltd v Blacker [2000] FCA 1458;
Neave v Trenerry [1999] NTSC 3;
Paynter v Willems [1983] 2 VR 377;
Platemaster Pty Ltd v M & T Investments Pty Ltd [1973] VR 93;
Realestate.com.au Pty Ltd v Hardingham (2022) 277 CLR 115;
Roxborough v Rothmans of Pall Mall Australia Ltd (2001) 208 CLR 516;
Simos v National Bank of Australasia Ltd and Guelman (1976) 10 ACTR 4;
TEA (1983) Ltd (In Liq) v Uniting Church (NSW) Trust Association [1985] VR 139;
TEC Desert Pty Ltd v Commissioner of State Revenue (WA) (2010) 241 CLR 576;
Tilley v Official Receiver (1960) 103 CLR 529;
Turvey v Dentons (1923) Ltd [1953] 1 QB 218;
Westpac Banking Corporation v Tanzone Pty Ltd (2000) 113 NSWLR 73
Judgment: 1. Within 14 days the parties must bring in short minutes to give effect to these reasons.
2.Costs reserved.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiffs | Ms M J Harris | Brown McComish |
| For the Defendants | Mr M O’Haire | Maddens Lawyers |
HIS HONOUR:
Background
1Relations between brothers have proved potentially problematic since time immemorial, as witness the story of Cain and Abel in Chapter 4 of the Book of Genesis. In this proceeding, the Court has to resolve a dispute between an elder brother, who was an established dairy farmer, and his younger brother, whom he effectively “sponsored” into a joint venture. The bitterness which now exists between the brothers has led to this proceeding’s being fought with a degree of venom and perhaps pettiness that is uncharacteristic in purely commercial disputes. The case has been fought over 20 sitting days. In dispute between the two sides are a collection of minor matters which add up to something more significant, but scarcely of the order of magnitude that would justify the vast expenditure of legal costs which must have occurred. The pleaded case includes a host of claims and counterclaims for minor items such as a tape measure valued at $29.95, a caulking gun valued at $25.95, and a roll of 1-inch “poly pipe” valued at $198. Many, but not all, of these minor items were abandoned in the course of the trial. Car wrecks which were the subject of abortive restoration projects in the 1990s were fought over as valuable assets. They became bargaining chips or prisoners to be exchanged.
2An area near Heytesbury known as the “Heytesbury Settlement” was opened up for dairy farming in the 1960s. (Transcript (“T”) 165, Lines (“L”) 4-6) Mr Darin Blain and his younger brother, Mr Craig Blain, who are respectively one of the plaintiffs and one of the defendants in this proceeding, were brought up by their parents on a dairy farm in this “settlement”, which has been referred to as “Farm 2” in the course of the present proceeding.
3In 1993, Mr Darin Blain married, forming a business partnership to conduct a dairy farm of 178 acres at 491 Melrose Road, Cooriemungle. The closest town to this property is Timboon with a population of approximately 1,000. (T1296, L7-10)
4The younger brother, Mr Craig Blain, finished his formal education in 1994, and in 1995 commenced a motor mechanic’s apprenticeship in Melbourne and moved to Melbourne. After some years resident in Melbourne, he moved to Warrnambool, which is a 40-minute drive from Timboon. He worked as a casual bartender at The Gallery nightclub in Warrnambool, then, from September 2000, he departed overseas for a period of three and a half years. On his return to Australia, he worked as a motor mechanic at Timboon Motors in Timboon. (T1294, L21 – T1295, L26) He then took up a store manager’s position with Repco Auto Parts in Warrnambool for approximately 18 months, eventually returning to Timboon Motors as service manager. (T1295, L29 – T1296, L6) Back living and working near the home where he had been reared, Mr Craig Blain said that his elder brother, Darin, “was a very good friend if not probably a best mate … I could see Darin was doing well on the farm and I guess I aspired to achieve the sort of thing that he had achieved.” (T1296, L22-26)
5In 1992, Mr Darin Blain became registered as proprietor of the land comprised in Certificate of Title Volume 8941, Folio 768 (Court Book (“CB”) 612-13), being the property described as Farm 1 and adjacent to Farm 2. According to Craig, his brother told him that his fulltime workers, Gary and Jenny, were leaving and this would create an opportunity for Craig and his wife, Talia, to come home to the farm and become dairy farmers. (T1296, L29 – T1297, L2) Craig said “I jumped at it.” (Ibid) The proposition made by Darin, according to Craig, was “that he would just pay us a management fee and we would employ another staff member to cover his role or duties, especially dairy duties.” (Ibid, L16-19)
6It was at this time that Craig established the Company which is the first defendant in this proceeding as trustee of a family trust. He summarised the situation as being that he “started off as an employee”. (Ibid L24) If, by that, he meant that he became an employee of his brother’s partnership, this was incorrect. Craig’s Company, the first defendant, was supplying management services to his brother’s partnership and if Craig was an employee of anyone, it was his Company, the first defendant. These events took place in 2009. (T1298, L27-29) According to Craig, “Darin said he would pay us a fee which I think was $100,000 plus GST, and he said ‘you can employ a full-time employee, pay them what you wish out of that $100,000 and basically, whatever is left over is yours’.” (T1299, L14-18) Craig saw his role as that “we were going to manage day-to-day … running of the dairy farm. So milkings, feedings and the like. Obviously … I relied on a lot of Darin’s knowledge and guidance.” (Ibid, L26-29)
7In addition to owning Farms 1 and 2, Darin owned another rural property in the area, being the land comprised in Certificate of Title Volume 10894, Folio 717, another rural property in the same area but not adjacent to the farms, being the land comprised in Certificate of Title Volume 9011, Folio 643 and described as “Out Paddock 1”, which was transferred to Darin and his wife, Sally, on 30 April 2007. (CB 622) In 2009, therefore, Darin, either solely or jointly with his wife, owned Farms 1 and 2 and Out Paddock 1. (T1299, L30 – T1300, L3) Under the 2009 arrangement, Craig’s Company was the sole employer and there were no employees of the partnership. (T1300, L5-12) Craig said that at this point his brother “had a crook back and the dairy was what was probably the worst, the worst duty on the farm that caused the most irritation to his back.” (T1301, L11-13)
8Around 2011, according to Craig, Darin told him that “he had been to a doctor’s appointment and a doctor had told him that if he doesn’t get off the farm he will be in a wheelchair in 12 months.” (T1301, L27-29) Craig continued “I guess that was what kicked things into gear about talking about a joint venture.” (Ibid L30-31) Darin denied that he entered into a joint venture arrangement with his brother as a result of medical advice. Cross-examined by counsel for the defendants, Mr O’Haire, Darin said that the impetus to establish a joint venture with his brother derived not from his receiving medical advice that he “needed to get off the farm”, but because of particularly favourable milk prices. (T722, L22-24) Darin did concede, however, that he had a “crook back”. Darin spent many days in the witness box being examined and cross-examined, giving his evidence throughout from a standing position. He said “I just don’t like sitting down all day. It’s not good for your posture and I prefer to stand …” (T1083, L4-6) He conceded he had a “crook back” and had received advice from a surgeon that he was “in probably the wrong profession for it”. (Ibid L18-19) Nevertheless, whilst not in the witness box he was able to sit behind his counsel for the balance of the hearing without apparent discomfort.
9According to Darin, the first conversation between the brothers as to a joint venture “would’ve been in July [2011] because that would’ve been [when] the milk price was good, [a] good time to get in, we will set up a CB-type loan and talk to Nick [Sinclair of Rabobank]”. (T334, L3-6) One of the matters which needed to be resolved was the price at which the existing dairy herd owned by the partnership would be dealt with for joint venture purposes. According to Darin, he believed that the proper figure per head of the dairy herd was $2,000, but he discounted it to $1,800 and provided for a herd lease in favour of his brother’s Company, attributing a value of $1,800 per head with an “earn rate” of 7 per cent. (T334, L11-16) With Craig’s Company leasing the herd of cattle, it needed either to own a farm or lease a farm unless the herd was to be agisted. (T335, L2-4) Darin said the structure of the venture “was going to be a partnership but it didn’t work out that way so it was just a joint venture, as in we didn’t run separate partnership accounts or anything else. It was just easier to run it as a joint venture … all expenses were split down the middle, half the milk cheque went each way. It’s just easier. Each party did their own tax returns and no need to have a partnership tax return between the companies [sic] or between the partners.” (T335, L7-16) Even if the arrangement might have been characterised as a partnership, as defined in the Partnership Act 1958, it was not treated as such by the brothers. (Ibid, L17-19) Certainly, Darin and his brother would seem to have structured their joint venture without professional advice from a solicitor or accountant. Craig had already established a trading discretionary trust in 2009, but there seems to have been no further structural advice given when the management arrangements entered into in 2009 were translated into the joint venture. (T336, L4-20)
10Darin said he decided to sell Farm 1 to his brother because he “had owned that for more than 15 years so that the capital gains obligations were less. That Farm 2 was inside the 15 year ownership so the capital gain would have been 50 per cent more.” (T336, L24-27) Craig was already living in the farmhouse on Farm 1 and Darin and his wife lived in the farmhouse on Farm 2. (Ibid, L29-30) The price for the Company to purchase Farm 1 was set at $1.07 million. Darin said “that was determined on the price of $6,000 per acre and basically that it was a highly profitable farming operation and that was about where its value sat.” (T337, L10-15) Darin said that this price was not a point of negotiation. He nominated it and Craig accepted it. (Ibid, L16-19)
11Craig agreed that he was not bringing any capital to the joint venture. He was receiving a “deal” that would not likely have been offered to anybody other than a family member. The parameters of the joint venture were laid down by elder brother, Darin, and he, as the younger brother, simply accepted them. (T1314, L16-23)
12As to the machinery to be used by the dairying joint venture, according to Darin “Machinery was made available [by the partnership]. It was maintenance and repairs would be 50 per cent and we later had a discussion … because I had all the machinery so it was fine but down the track we would have to look at replacement values and that would be dealt with at a later date …” (T339, L21-27) The arrangement which Darin said was reached would be one “whereby both parties would chip in to replace things that had worn out.” (T339, L30 – T340, L1) As will appear, the existence or otherwise of a term in the joint venture to this effect is one of the central controversies in the proceeding. This issue, according to Darin, was discussed and agreed upon “later” – “the machinery was all fairly new so I knew that it wouldn’t have to be replaced for a number of years … I didn’t know the joint venture was only going to last seven years. … I would’ve expected it to have lasted longer but there would have been a period as to machinery cycles from new down to used, it would have had to have been replaced and you keep going.” (T340, L5-12) I pressed Darin to indicate a year in which this apparently ex post facto term was agreed upon between the brothers, but I did not understand him to give a direct and a definitive answer. (Ibid, passim) The cost of repair was an operating expense and, according to Darin, was therefore to be shared 50/50. (T341, L30 – T342, L3)
13Commencing a dairying joint venture on a particular day necessarily raises transitional issues. The milk collected on the morning of the first day will have been at least partly derived from the milk taken the previous (pre joint venture) evening. These matters do not appear to have been discussed in 2011. (T342, L27-28)
14As the terms of the joint venture were being discussed there was a spirit of optimism, such that no specific arrangements were made as to what would happen at its termination. (T343-344, passim) Darin believed that issues such as fertiliser to be applied to the two farms (Nos 1 and 2) being used jointly “would have been” discussed. (T345) Darin said:
“What was explained to Craig very early on was that ... both farms and the out-paddock – both out-paddocks after that, they were all treated exactly the same in fertiliser output, not so much re-sowing but maintenance, tracks, fencing. I see so many people that have out-paddocks that don’t apply the correct amount of fertiliser, they don’t get enough grass, obviously affecting pasture growth and silage production and all that, and feed for the heifers. So you treated every one [scil, each parcel of land] the same, you didn’t put less on the out-paddocks which is mainly what we are talking about, the out-paddocks, because you actually create less fee [sic – scil feed].” (T345, L29 – T346, L10)
15On 18 August 2011, Darin and his wife became registered proprietors of a further parcel of land, being the land comprised in Certificate of Title Volume 2837, Folio 344, in Waarre Road, which is described as “Out Paddock 2”. This out paddock was also to be part of the dairying joint venture, and in due course was to be the location of the residence for Darin and his wife.
16To enable the joint venture to be established, Craig and his wife had to raise their contribution by a combination of vendor finance from Darin and/or the partnership and external borrowing from Rabobank. The partnership was an established customer of Rabobank. By a letter dated 14 October 2011, Rabobank made an offer of a facility described as “new all in one account” with face value of $830,000 consisting of a property purchase loan of $685,000 relative to Farm 1, $125,000 “Refinance Homeside Lending” (that is, Craig and Talia’s home in Warrnambool). The security required was as follows:
· Registered first mortgage from Craig over Farm 1.
· Registered first mortgage from Craig over his Warrnambool residence.
· Fixed and floating charge over the assets of Craig’s Company and an unlimited guarantee from Craig’s Company.
17The letter included a series of Special Conditions divided into “Pre Settlement” and “Post Settlement”. The first of the Pre Settlement Special Conditions was as follows:
“1)Prior to settlement the Borrower must provide Rabobank with a copy of the executed written agreement [“the Agreement”] (which is satisfactory to Rabobank in its sole discretion) between Darin William Blain and Sally Louise Blain and Craig Blain and Blain Dairying Pty Ltd as Trustee for The Blain Trading Trust in relation to the vendor loan and cow lease purchase which is to include but not be limited to:
i. Vendor loan terms and conditions
ii. Lease purchase of cows terms and conditions
iii. Use of out paddock and plant and equipment by the Borrower/Security Provider(s)
iv. Use of dairy by the Borrower/Security Provider(s) to milk their cowsv. Exit or winding up provisions.” (CB 643)
18This letter was signed by Mr Nick Sinclair as account manager. (CB 643-646) The written agreement between Craig’s Company and the partnership referred to in the Special Condition, which was to be to the bank’s satisfaction in its sole discretion, seems to have been drafted by Mr Sinclair. He sent an email to Craig’s wife Talia and to Darin on 18 October 2011 covering the “start of draft agreement. Very rough at this stage but a start at least ...” He invited the brothers and their wives to “amend, add, or rewrite to your agreement and understanding.” Mr Sinclair added, “You may want to run a final version past your solicitor or engage them to help draft it up.” (CB 654-5)
19Some 10 days later, on 28 October 2011, Mr Sinclair sent an email covering what he described as “an updated version [of the agreement] for you to consider following our discussions the other day. Please have good look at it and run past your solicitor before finalising. Make any amendments you like.” (CB 656-658)
20Presumably because the original letter of offer had lapsed and expired, Rabobank issued a further letter of offer to the same effect as the original one, including the amount towards the purchase of Farm 1, the refinance of Craig’s Warrnambool residence, and $20,000 working capital, dated 29 October 2011. (CB 660-665) Craig, his wife, and their Company, accepted this offer by annotation dated 29 November 2011. (CB 665) Craig’s wife, Talia, sent an email to Mr Sinclair stating:
“We have a meeting with Marcus [the Blain family’s solicitor] on Monday to discuss and sign contracts. We will bring in the signed agreement between Fang [that is, Darin] and ourselves. Please let us know if there is anything else you need from us prior to Monday.” (CB 666)
21Rabobank’s securities included a document styled “Farming Agreement” expressed to be between “Darin & Sally Blain and Craig & Talia Blain which incorporates Blain Dairying P/L ATF The Blain Trading Trust.” The document, dated “5-12-11”, purports to be signed by Darin and his wife and Craig and his wife, and is in the following terms:
FARMING AGREEMENT
This agreement is between Darin & Sally Blain and Craig & Talia Blain which incorporates Blain Dairying P/L ATF The Blain Trading Trust.
Purchase of Land
The land 72.11Ha located at 491 Melrose Rd, Cooriemungle Certificate of Title 8941/768 (currently owned by Darin Blain) will be purchased by Craig Blain for $1,070,000.
Finance
Bank finance will be provided by Rabobank for the amount of $685,000. The balance of the purchase price of $385,000 will be provided by D&S Blain. Finance provided at 7% interest only for a period of 7 years. There will be an option to extend this for a further term to be negotiated at the end of the initial 7 year period. D Blain will formalise a Registered Second Mortgage.
At Rabobanks request the repayments of the vendor loan will be subordinated.
Purchase of Cows
135 cows, 35 heifers and 35 calves are being purchased for a total of $300,500. D&S Blain will provide the finance for the cows on a lease purchase facility. Terms are repayable over 7 years @ 7% p.a. with a $50,000k residual. The residual can be repaid in full or over a further term to be negotiated if required.
Ownership of the cows will not transfer until final payment is made. C&T Blain agree not to mortgage the cattle to any third party without D&S Blains consent.At Rabobanks request the repayments of the lease purchase facility will be subordinated.
Identification
For the purposes of this agreement the initial herd size will be 270 cows and replacements. Ownership will be on the basis of 50% of the herd and replacements at any point in time and if direct ownership is required and will be drafted 50-50.
Income and Expenses
Milk Income 50-50, stock income 50-50
All General Farm expenses 50-50
Expenses specific to each property will be responsibility of owners (i.e. rates, insurance)
Continuity of Milking
The current dairy is located on property owned by D&S Blain. If required and whether or not this agreement is in place, the cows will be able to be milked from this dairy.
Use of Plant and Equipment
All plant and equipment currently owned by D&S Blain and used on the current dairyfarm will continue to be available for use at no additional capital cost to C&T Blain. Ongoing repair and maintenance will be paid for on a 50/50 basis.
Use of Outpaddock
The business will continue to have use of the outpaddock located on Waarre Rd. There will be no additional payment/lease for use of this block by C&T Blain. Expenses to maintain this property will be paid for on a 50/50 basis. Capital expenses will be the responsibility of owner unless otherwise agreed.
Exit Strategy
If for any reason either party wishes to sell, the other party will have first right of refusal of purchase. Land to be purchased at fair market value arrived at either by agreement between the parties or settled as per appointment of a Valuer agreed by both parties.
It is recognised and agreed that the cows have been purchased at a discount to market value in the initial transaction. If cows are being repurchased by D&S Blain, the current market value will be used as a base less 25%. Market value to be as agreed by both parties or by appointment of an agreed stock valuer.
If this agreement expires, is not renewed or is varied in any way the parties agree to notify Rabobank.
(CB 669-670)
22This document is obviously derived from the initial “rough draft” propounded by Mr Sinclair and appears not to differ materially from the second version which he emailed to the parties.
23According to Craig, he and his wife went to the offices of the family solicitors, Jellie McDonald in Warrnambool, on 5 December 2011, to sign documents for the purposes of the sale of Farm 1 and the loan from the bank and the lease of cows, attending Mr Marcus Malseed. (T1320) Mr Malseed gave them advice as to the various documents, including in particular a clause in the herd lease, he said, which permitted the lessor – Darin – to buy back the herd at a discount of 25 per cent in some circumstances. Mr Malseed said that were he advising Craig and Talia as his sole client rather than advising both brothers and their families, he would advise against such a provision. (T1321-2) Craig said:
“We had a discussion with Marcus about the farming agreement and Marcus made a few points. He said obviously he hasn’t drawn up the agreement. He said ... that it’s not a very well drawn up agreement.”
24According to Craig, the solicitor drew attention to a similar provision as to a buyback of stock at a discount which he had highlighted relative to the herd lease. (T1322, 11-15, 17-21) According to Craig, the solicitor said:
“[T]hat’s something that the bank obviously requires. We signed it in his office.” (Ibid, L22-23)
25Craig did not believe there were any other signatures on the farm agreement when he signed it. (T1323, L11-12) Craig and his wife also signed “a contract of sale for the farm and the herd lease contract”. (Ibid, L18-20) He said that his wife “dropped off” those documents at Rabobank. (Ibid, L22-30)
26Mr Malseed gave evidence on behalf of the plaintiffs. He said that in 2011 his firm’s offices did not include any conference rooms. Accordingly, consultations with clients took place in the relevant solicitor’s own office. (T1138, L17-22) Mr Malseed identified a number of documents dated 5 December 2011 which he had signed as witness. (T1140, L1-7; CB 684-694) Even although he did not add his name as witness to the signature of the contract of sale for Farm 1, he could identify Mr Craig Blain’s signature. (Ibid, L9-21)
27Mr Malseed said that in addition to the executed documents themselves he had access to his firm’s file on the matter from 2011. (T1141, L6-10) He had perused that file for the purposes of refreshing his memory. As to the document dated 5 December 2011 which showed Mr Malseed’s signature as witness, he said “I would not put my signature as a witness unless I had seen the person sign the document first.” (T1142, L25-27) In so far as the documents showed Darin’s signature witnessed by Mr Malseed, he said “I can’t recall if all three [viz Craig, Talia and Darin] were in the same room or they were in separate rooms. Unfortunately, the file doesn’t clarify that and I can’t say with certainty that they were all either in the same room or Craig and Talia in one room.” (T1143, L11-14)
28Having identified and verified the signatures on all the other documents, either by recognition of signature or by seeing his own signature as witness, Mr Malseed said as to the Farming Agreement that he did not recall its being signed at his office on 5 December 2017. (T1144, L21-23) He said he had no recollection and there was no record of the Farming Agreement in his file. (Ibid, L27-29)
29Taken to the handwritten note of an attendance on Mr Darin Blain apparently on 9 November 2011 (CB 257) by Mr O’Haire, cross-examining for the defendants, Mr Malseed conceded a reference in the note to “farming agmt”. (T1146, L15-22) He also identified a further reference to “Farming agreement” at CB 258, apparently as part of the notes of the same attendance. Mr Malseed accepted that the attendance notes indicated that he was told of the existence or proposed existence of the Farming Agreement. He did not accept that it took matters any further than that. (T1147, L20-29) He was prepared to accept that what Craig said about the Farming Agreement and its signature at his office might have happened, and he could not categorically say that it did not. (T1148, L4-9)
30Mr O’Haire then took Mr Malseed to a provision in the herd lease for a repurchase by the lessor Darin of the herd in certain circumstances for a 25 per cent discount. He said he could not remember having discussed this clause with Craig and Talia. (T1149, L15-27) He said his state of mind as to this was that he did not “have a recollection of discussing that precise provision ...” (T1150, L3-4) He agreed that it would have been his duty and his usual practice to explain to his clients the substance of the documents he was advising on, and mention any “unusual terms”. (Ibid, L25-31) Mr Malseed agreed that the cow lease was his draft. (T1151, L20-23)
31Darin said that he had declined to sign the Farming Agreement and had so informed Mr Sinclair on the porch of Craig and Talia’s residence in Warrnambool. (T772, L9-13; Ibid, L20-21) Darin said that Craig was present, but he could not say that Talia was. (Ibid, L22-25) Darin said he told Mr Sinclair that “we were supplying the vendor loan, 385k, so that would satisfy their [viz, Rabobank’s] LVR [loan to valuation ratio] for the bank and they had all the mortgages in place, so that should satisfy all of their criteria for the loan.” He agreed that this conversation took place some time in February 2012. (T772, L1-8) Craig denied that this happened. (T1126, L1-12) Perhaps surprisingly, neither counsel asked Mr Nick Sinclair, who gave evidence on subpoena on behalf of the plaintiffs, whether this exchange took place in February 2012, whether on Craig Blain’s porch or elsewhere.
32Mr O’Haire, in cross-examining Darin, drew attention to the fact that the Farming Agreement executed, or purporting to be executed, by him and his wife Sally appeared to be in circulation as at 12 December 2011 under cover of an email from a Ms Tracey Beddison of Rabobank. (CB 1939, 1965-66) It was described as being an enclosure or an attachment. (CB 1940) It was also a “box ticked” on a range of matters which were required for settlement. (CB 1943)
33The complex of transactions (whether including the Farming Agreement or not) settled in the new year of 2012. The transfer of that property from Darin to Craig was registered on 9 March 2012. (T609) For operational purposes, the joint venture was regarded as having commenced on 1 November 2011. (T287, L10-11)
34Darin obtained a second mortgage over Farm 1 to secure the vendor finance which he extended to his brother in the sum of $385,000. Rabobank’s first mortgage over Farm 1 secured $685,000 plus interest and costs and expenses by way of first priority. (CB 1970) Presumably the mortgage was in standard bank form, securing all money owed on any account whatsoever by the mortgagor to the bank.
35The equipment for the operation of the joint venture was provided exclusively by the partnership, being the plant and equipment which it had used to operate the dairying business immediately before the joint venture, viz until 31 October 2011. The basic and irreducible commitment required by the dairying business was the conduct of two milking sessions, morning and afternoon, of approximately two hours each. Morning milking commenced at 5.15 to 5.30am. (T316, L16-18) Morning milking took a little bit longer, perhaps somewhat over two hours, because it was necessary to wash the yard out. Afternoon milking might take a little less than two hours. (T316, L29 – T317, L4)
36Darin said that by 2005 the two farms had been effectively merged and constituted “a very smooth operation to run”. (T317, L17-27) From there on, he said, it was “just repairs and maintenance and bits and pieces here and there, and feeding ... feeding, that was critical.” (T317, L31 – T318, L2) He agreed with me that the responsibilities of running a dairy farm were heavy and relentless. (T319, L10-16) In the period 2009 to 2011 – that is, before the commencement of the joint venture – Darin was unable to say how he “covered” annual leave taken by his brother. (T326, L23‑30)
37Aside from the issue of plant and equipment, there was a further inequality between Craig’s Company on the one hand, and the partnership (Darin and Sally) on the other. The partnership before Craig owned two out paddocks. Farms 1 and 2 were of approximately equal area, but the out paddocks brought additional land for production purposes to the joint venture solely from the partnership side. Darin said that he first broached the subject of the Company’s paying rent for the out paddocks about the time of the purchase of Out Paddock 2. As previously noted, this sale was completed in August 2011, and this would indicate that the issue of rental payable by the Company to the partnership for the out paddocks was broached from the very outset of the joint venture; indeed, three months before. (T347, L17-28) Each of Farms 1 and 2 was approximately 178 acres. Out Paddock 1 was 98.5 acres, and Out Paddock 2 was 132 acres. The out paddocks therefore were not mere appurtenances. Each of them was larger than either of the “home farms”. (T1708, L19-28)
38Darin said there was a “fellow” renting an area in the rear of one of the out paddocks at a rate of $150 per acre. (T347, L31 – T348, L3) Darin said he mentioned this rental figure to Craig. It seems the rental out the back extended to some 52 acres and constituted a sitting tenant at the time of purchase of Out Paddock 2. Darin said that he did not regard the tenant’s cow herd as being well maintained, and he “didn’t want any disease ... so I roughly finished that agreement.” (T348, L4-20) He recollected that this lease finished “in February 2012”. (Ibid, L23-24) According to Darin, therefore, rental was payable by his brother’s Company for the out paddocks from the first year of the joint venture. He continued:
“[B]ut I still said we would defer it because 2012 wasn’t a great – sorry, 2012 was a good year so you wanted to get them on their feet. 2013 ended up being not a good year and then we hit 2014. It was a good year and Craig had said he had surplus cash or surplus money, what should he do with it. I said he had – there’s options out there, there’s FMDs, farm management deposits, there’s superannuation and had a discussion about you could backpay the deferred rent.” (T348, L27 – T349, L5)
39Darin said Craig agreed. (T349, L6) Darin said there was no agreement as to rental for subsequent years. He claimed he said:
“ ‘Pay two years and you pay one into the accountant and the next one as a cheque’, because I like cheques ... it was a good year so I wanted to keep that cheque to put in to a lesser year.” (T349, L17-23)
40This was apparently so that the income could be shown as derived for the purposes of his tax return in a later year with perhaps a lesser milk income. Darin said:
“I would only charge him the rent in a year where it was a good milk price year and we would just backpay it to fill in those years that weren’t so good.” (T350, L2-5)
41Darin said he regarded the rent as charged as being “cheap rent”. (T350, L7-12) For 2017 he said he wanted rent at what he regarded as still a conservative rate of $170 per acre. (Ibid, L13-14)
42Ms Harris took Darin to the partnership’s bank statement for the period 1 June 2014 to 30 June 2014, which showed a transfer made on 27 June described as “Heifer Rearing”. Darin said:
“This is what I received from Blain Dairying for – it was classed as heifer rearing and yearly rearing expenses, based on the lease.” (CB 1984; T350, L26 – T351, L7)
43The amount in question was $18,480 (T351, L11), which represents a charge of $150 per acre for 112 acres. (Ibid, L13-14) 112 acres represents half of the available grazing area of the two out paddocks. (Ibid, L25-27)
44Darin was taken next to CB 1985, Partnership Bank Statement for 1 January 2015 to 31 January 2015. On 6 January there is a recorded deposit of $18,400. Darin Blain had made annotations to inform his accountant that $18,400 represented the rental portion of a larger deposit of $23,283.78. (T353, L25 – T354, L10)
45Darin was then taken to the partnership’s Rabobank statement for the period 1 June 2016 to 30 June 2016 at CB 1986, which contained notations “Outpaddock 2016” and “Outpaddock 2015”. Darin’s view was that “It was supposed to be the rent for 2014 and 2015”. (T357, L3-4) He said he returned the EFT payment on 30 June 2017, as testified by entries at CB 1987. (T357, L6-8) The statement characterised it as “Returned rent”. (T358, L1) Darin said he made the refund “Because I wanted it in cheques” (T358, L16) so that he could leave those cheques on the shelf until the new financial year. (Ibid, L19-20)
46He was then taken to yet a further bank statement page, at CB 1988, for the period 1 June 2017 to 30 June 2017. On 28 June there was a deposit of $37,696.78 with a handwritten notation of “Lease”. (T358, L22-31) Darin explained:
“Craig gave us two cheques and that’s the two cheques there put in the bank, banked on 28 June 2017.” (T359, L7-10)
47The rental years in question were the period 1 November of one year to 31 October the following year. (T359, L12-17)
48Darin said he sought to increase the rent for the final three years, namely the years ending 31 October 2016, 2017 and 2018, to the rate of $170 per acre. (T360, L3-9) Darin said Craig “wasn’t keen to pay it”. (Ibid, L12-13) He said this conversation took place in late 2016. Darin said he explained that he had consulted a neighbour, Mr Ronnie Milne, who was leasing his property almost adjacent to the relevant land, and that $170 per acre was “certainly no larger than the market rent”. (T361, L2-11) Craig, he said, gave him a rental cheque calculated at the old and lower rate of $150 per acre, which he said “was a simple cheque”, and he [Darin] returned that cheque to his brother Craig at a mediation conducted on 3 July 2018 to resolve their differences. (T361, L18-24) He had been given the cheque “a few months before”. (Ibid, L26) It seems Darin felt that banking the cheque might entail acceptance that the $150 per acre was the proper rental. (T362, L7-10) Darin said that approximately $60,000 is outstanding for the years 2016, 2017 and 2018. (Ibid, L19-23)
49The final year, viz 2018, was charged for only 11 months rather than 12 months, according to Darin:
“Because we were ending the share farming agreement on that date [viz 30 September 2018]. So what it was was Craig had been there – the joint venture had ran for seven years and he had had the benefit of silage for seven years. So year 1 he had had the benefit without doing any fertilising or anything else and so he got that silage year 1, 2011. Seven years later he had had seven years worth of silage in a seven are-year [sic] agreement so you can’t get eight years of silage in a seven-year agreement.” (T363, L12-21)
50Darin said he had previously given a “notice of intention” to terminate the joint venture as at 31 October 2018. (T363, L12-24) This was referred to in opening by Ms Harris, where she said that on “11 September 2018, the plaintiffs wrote to the defendants and said, ‘We give formal notice that this joint venture will end on 31 October 2018’.” (T103, L26-28) Earlier, on the same page of the transcript, she is recorded as saying:
“so there was a notice issued by the plaintiff on about 4 July 2018 which said an intention to terminate was effective on 31 October 2018.” (Ibid, L18-21)
51I asked Craig about this. (T1361) He denied it. (T1362, L8-12) Darin said the notice was handwritten, and presumably therefore no copy was retained. (T362, L30-31; T389) According to Darin, this handwritten notice was given the day after the unsuccessful mediation. (T389, L22-23) What unquestionably did happen was that under cover of an email dated 19 July 2018, Darin sent Craig’s wife Talia a document styled “Tax Invoice”, but undated, in the following terms:
“TAX INVOICE
DW & SL BLAIN ABN 70249813276
414 Timboon Scotts Creek RoadTIMBOON VIC 3268
C&T BLAIN
BLAIN DAIRYING Pty Ltd
491 Melrose Road
COORIEMUNGLE VIC, 3268
Lease of Land
01/11/2015-31/10/2016
$170 Acre x 112 Acres
$19040.00
Lease of Land
01/11/2016-31/10/2017
$170 Acre x 112 Acres
$19040.00
Lease of Land
01/11/2018-30/09/2018
$170 Acre x 112 Acres
$17453,00
Sub Total;
$55533.00
GST;
$ 5553.30
TOTAL;
$61086.30
PAYMENT WITHIN 14 DAYS.
We reserve the right to charge a fee on overdue invoices and recover all expenses incurred for Debt recovery.
The Land Lease agreement ceases on the 31/09/2018. You CANNOT harvest any hay or silage on land owned by DW & SL Blain.
DW & SL BLAIN
ABN 70249813276
TOTAL: $61086.30” (CB 1823)
52As a further indication of the breakdown of relations between the brothers and therefore between Craig’s Company and the partnership between Darin and his wife, Darin sent an email to Terry McMahon, by then the account manager for the Blain account, on the evening of 3 August 2018, as follows:
“Hello Terry
As Craig and Talia Blain have not supplied information that was requested by the close of business today, we have no option but to revert to legal action. As of Monday all mortgages associated with Blain Dairying will be removed. We require all signed documents between both parties.
Regards Darin Blain.” (CB 544)
53The reference to “all mortgages” being “removed” is perplexing. Presumably Darin was stating, in effect, that he wanted the first mortgage which he held over Farm 1 paid out; perhaps also the stock lease.
54As to the issue of rent for the out paddocks, Craig said that this was first broached with him “in around June of 2014”. (T1326, L22) He said he rang his brother, raising for discussion a number of farm expenses which he said his brother was debiting to the Company as joint venture expenses “that were actually capital improvements or new things he was building around his house”. (Ibid, L26-29) He said he told his brother “I don’t really think it’s fair that you are lumping these expenses into the joint venture expenses.” (Ibid, L29-31) He said Darin replied “Okay, well, that’s fine. Exclude those expenses ... You can start paying some lease on the out-paddocks then”, to which Craig said he agreed. (T1327, L1-3) According to Craig, “Darin pretty much just said how it was going to be.” (Ibid, L5-6) He required payment of $150 an acre, saying “and you can backdate it to November last year”; that is, 2013. (Ibid, L6-8) Craig said he did not think that was fair, and the discussion became heated, and “we wrote two cheques out”. (Ibid, L13-16; CB 1221) The Company’s bank statement showed a debit by way of an internet transfer to the partnership in the sum of $18,480 described as “Heifer Rearing”. According to Craig, that was “what Darin wanted the payment to be described as”. (T1328, L6) In answer to a question from me, Craig agreed that the internet transfer represented rent for 112 acres – that is, the effective area of the out paddock – at $150 an acre, “going back to November of 2013”. (T1328, L25-30)
55Craig was then taken to a page of his Company’s bank statement covering the period 1-31 January 2015 (CB 1228) showing a debit of $18,480 representing the presentation of “cheque 31”. Craig said he wrote that cheque “in late June 2014” and therefore its presentation seems to have been delayed. (T1330, L1-3) Craig denied that these payments represented rent backdated to the beginning of the joint venture in 2011. He said “That was not discussed.” (Ibid, L13-14) The bank statement for Craig’s Company for the period 1 June to 30 June 2016 shows two debits in the sum of $18,480 by way of internet payments to the partnership. Those transfers were reversed by the partnership on 30 June. (CB 1819) Darin told Craig that he wanted cheques. (T1331, L1-3) Craig said he drew the cheques in “late June 2016” and gave them to his brother. (Ibid, L5-6) He said he gave his brother a further cheque in June 2017. Craig denied that there were any discussions about increasing the rent during the term of the joint venture. (Ibid, L16-21) He then modified that evidence by agreeing that the issue of rental on the out paddocks was discussed “at the mediation meeting with Saul Moncrieff in July 2018”. (Ibid, L26-31) He said Darin told him “we still owed him for the first two years of out paddock lease” (T1332), which Craig said he denied. (Ibid, L6-8)
56The treatment of expenses, including staff expenses, as between the joint venture partners, was somewhat complex and varied over time. As of 31 October 2011, the Company was managing the two farms and providing the labour in return for a management fee. That regime persisted as from 1 November 2011. (T1332, L9-16) According to Craig, the nature of the management fee changed, such that it would no longer include a “wage” element for him as his Company’s principal officer. The Company would now receive half of the net proceeds of the milk cheque. (Ibid, L21-29) The management fee reduced but would continue to be paid by the partnership to the Company. The wage outlays were the Company’s responsibility. (T1333, L5-10)
57According to Craig, when full-time employee Lachlan Jones commenced work for the Company on joint-venture business in the first half of May 2014, he had a discussion with his brother Darin as to the size of the management fee. He said that Darin proposed an annual figure of $60,000, but Craig concluded that that would be insufficient to meet the wages of Mr Jones as a full-time employee and the additional outlays required for casual labour to cover Mr Jones’ weekends off and annual holidays. (T1336, L30 – T1337, L5) Craig said he proposed a figure of $70,000, to which his brother agreed. (T1337, L7-9) Craig said that it was no part of these discussions that there was to be a “reconciliation” of wages. (Ibid, L14-19) As Craig saw it, the $70,000 fee was to be at his Company’s disposal without any obligation to account, aside from its obligation to employ labour, whether it be the full-time Mr Jones or casual fill-in to meet the joint venture’s labour requirements. (Ibid, L20-23)
58The Company entered into a salary-sacrifice arrangement with Mr Jones, entailing its providing him with a motorcycle which would be paid off by reductions in his wage over a stipulated period. (CB 1227) According to Craig, he told Mr Jones “We would be prepared to purchase the motorbike and then you could salary sacrifice the motorbike by your wages reducing slightly each week to pay for the motorbike over a 12-month period.” (T1339, L18-21) Craig said that Mr Jones was “rapt”. (Ibid, L23) The agreement was dated 23 February 2015, and the arrangement served to “pay off” the bike. (T1340, L7-8)
59Following the departure of Mr Jones from the Company’s employment in March 2017, according to Craig his brother agreed to the continuation of the management fee for a period without any obligation on the Company’s part to account for or reconcile outlays of the management fee. (T1340, L9-22) This arrangement, he said, terminated with the last management fee payment in July 2017. (Ibid, L25-27) With Mr Jones departed, Craig said that the costs of casual labour (presumably in the absence of a full-time employee such as Mr Jones) cost more than the management fee. (T1340, L28 – T1341, L3) Craig said “We had a discussion with Darin and the management fee ceased. Then we started advising Darin of how much the wages were, or his share of the wages for each month and he just paid us the monthly wages amount, I guess.” (T1341, L4-8) He said that he and his wife “were still providing our 50 per cent of the labour and then the casual staff were providing the partnership’s 50 per cent of the labour.” (Ibid, L21-23)
60Craig accepted that any outlays to replace or “cover” the labour contribution from him and his wife were for the Company’s account, not the partnership’s. (T1342, L7-8) This arrangement apparently replicated a similar arrangement which existed before the commencement of Mr Jones’ full-time work. (T1356(?), L15-18) Craig said that when he and his wife went on holiday in 2018 he “took the full amount that was paid to staff in that period, I divided it by 2, so I split it in half so that we were responsible for 50 per cent of that labour, and then charged the partnership the other 50 per cent.” (T1342, L17-21)
61Darin took a different view of these things. He complained that he was given no access to employment records: “I had requested information multiple times and particularly towards the end, and none was handed over.” (T391, L5-9) He said he sought access to the “wages book”, which was at all times denied. (The wages book was produced in the course of the trial.) Darin said the only information he had was to be found in the dairy diary which was kept in the dairy on what was Farm 2, which recorded the hours worked by casuals, together with other matters such as cattle treatments, calvings, and anything to do with stock on the farm. (T391, L22-28) This was a “friction point” between the brothers. Darin said:
“There was no reconciliation each month of how much ..., we paid a set amount each month and there was no reconciliation coming back. I wanted reconciliation on how much he had been paying, like, that was above what the wages should be and then it would be calculated what the actuals were and there would be some sort of a reconciliation take place at some point, but it never did. So I had suspicions then.” (T392, L25 – T393, L2)
62Ms Harris asked Darin when it was agreed that there were “set wages” (a phrase which I assume is to be regarded as synonymous with a fixed management fee). He said “We started on set wages at different times. It was a management fee and then we went to set wages in I think about 2014, without being exactly right.” (T393, L5-8) I asked if that meant that from 2014 onwards, for a period of time, the Company regarded itself as entitled to a management fee without obligation to account for how it was spent. Darin said:
“That’s right. Before that [viz, 2014] we would get the monthly wages so it would be a varying figure and post then we agreed on a set wage which was supposed to be 70k. I think it ended up about 78 we were paying. It was $7,220.52 per month and that was including GST, I think. So it was supposed to be some – so rather than have each month come in with varying amounts, Craig just wanted one amount to pay each month.” (Ibid, L16-23)
63In that time, Darin complained he received no reconciliation. (T393, L31 – T394, L1)
64Apart from “friction” on these issues of reconciliation, I was not provided with any detailed description of how it was that the brothers came to be at “daggers drawn”. Darin said the deterioration between the brothers was a “slow burn”. There seem, however, to be at least some particular incidents, including an occasion on which, in Darin’s opinion, Craig bullied Darin’s son Jayden, who worked as a casual employee over the term of the joint venture. (T384, T388) Craig described an incident in which Darin was banging on the door of the tractor which Craig was driving, relative to the bullying or alleged bullying. (T1334, L25-29)
65There were also occasions in the years before 2018 where there were heated discussions and Craig explored the possibility of exiting the joint venture. (Ibid, L2-14) As will appear, the rights and wrongs of many or most of these matters are not relevant to the matters now in dispute. The parties felt that their examination would be inflammatory. I will not be seeking to make any findings as to the rights and wrongs of such matters.
66There was no complaint that the partnership was not entitled to terminate the joint venture as at the last instant of 31 October 2018. The dairy herd was divided, with the partnership and the Company taking equal numbers of milk-producing cows. There is no dispute as to the appropriateness of this division. There is, however, a dispute as to the division of the stock other than the milk-producing cows, to which I will turn in due course.
67There was also a dispute as to the access to various paddocks. Aside from the “tax invoice” excluding the Company from harvesting silage on Out Paddock 2, Darin put a note in the dairy diary for 10 September 2018 including a diagram of a number of paddocks which were “shut up for silage”. His note was as follows:
“Paddocks 36 + 9 shut up for silage.
– " 35 to be used as night paddock.
– All paddocks on this property are to be only used as night paddocks.
– Move bulls from Paddock 1 to your property.
– Calves to be moved back to 1st split paddock at block.– All other paddocks at block as marked above are shut up for silage.” (CB 1772)
68Craig admitted that he did not act in accordance with this direction. He said that he put stock in for “lightning” grazing on the “shut up” areas. (T1670, L16-21)
69Following the end of the joint venture, Craig built a dairy on Farm 1 to enable it to operate separately as a dairy farm. He said the farm would have been worthless as a dairy farm without its own dairy. (T1658, L26-30)
70The end of the joint venture entailed the payout of Darin’s second mortgage over Farm 1.
71On 30 October 2018, Mr Marcus Malseed of Jellie McDonald solicitors, which firm had acted for both the brothers in 2011, sent an email to the firm then acting for Rabobank, namely Dentons, stating that the payout figure on the second mortgage was $208,239.78, made up as follows:
“Principal
$ 200,000.00
Shortfall in interest (26 months at $250 per month)
$ 6,500.00
Final month’s interest
$ 1,083.33
LTO fee – discharge of mortgage
$ 108.10
PEX fee
$ 53.35
Mortgagees legal costs on discharge
$ 495.00
$ 208,239.78
(CB 754)
72Craig’s Company’s account was debited with this sum. It counterclaims in this proceeding for an alleged overpayment to Darin of $7,500. It challenges the alleged “shortfall in interest (26 months at $250 per month)” in the sum of $6,500 and contends that there was an overcharging.
73The second mortgage as executed provided for payment of interest on the principal sum at the rate of 7 per cent. (CB 716) Examining bank statements, it appeared that the interest payment as at July 2014 had been adjusted. Darin said “Craig got some interest rate relief by half a per cent.” (T409, L22-23) Darin said that he received a request for that relief and agreed to it. (Ibid, L24-26) Darin conceded on the basis that thereafter the interest rate under his second mortgage was reduced to 6.5 per cent. (T410, L10-11) Darin said that he had not noted at the time that the interest which his brother Craig paid was not the 6.5 per cent which he says he agreed upon, but rather 5 per cent. He said he never agreed to such a reduction (T410, L23-24), hence the inclusion in the payout figure as advised to the bank’s solicitors of an amount of interest arrears.
74Mr McMahon, the account manager for the Blain family as at the “washup” of the joint venture in 2018, said that the bank had in fact refunded an amount of $8,000, being an alleged overpayment to Darin, to Craig. (T1180) He said, “My memory was that the bank refunded up to what might have been $7,000 or $8,000.” (T1180, L9-10)
This proceeding
75Solicitors acting for the partnership filed the writ which commenced this proceeding on 28 January 2022. By the time the matter came on for trial before me, the plaintiffs’ claim had reached its fourth iteration in the second further amended statement of claim dated 1 October 2024. I will refer to this as “the Statement of Claim”.
Statement of Claim
76In their Statement of Claim, the plaintiffs describe the parties and the constitution of the joint venture agreement, alleging a series of express or implied terms generally along the lines of the narrative above. In particular it was alleged that:
(i) Each party, being the plaintiff partnership and Craig’s Company, the first defendant, would pay to upkeep the pastures and farm infrastructure on the Farms;
(ii) The plaintiffs would charge the defendant Company, and the Company would pay annual rent for the Company’s use of Out Paddock 1 and Out Paddock 2;
(iii) The defendant Company would pay 50 per cent of the cost of maintenance and repair of the Partnership Plant and Machinery and a contribution to the cost of the replacement costs of the Partnership Plant and Machinery in the event repairs were not economically viable;
(iv) At the cessation of the joint venture the Company agreed that Farm 2 and Out Paddocks 1 and 2 would be no worse in condition than at the commencement of the joint venture.
77The defendant Company agreed with the plaintiff partnership that it would employ dairy workers to supplement the labour required for the joint venture, and pay each such employee their employee entitlements, with the Company, via Craig Blain and his wife, contributing 50 per cent of the labour seven days a week, and, if Craig and Talia had any time off, the Company was responsible for the cost of any employee used to supply the Company’s 50 per cent labour unit.
78On and from May 2014 the Company would charge the partnership “a set amount per month plus GST for wages for employees”, and credit the partnership with any difference between the amount of the Set Wages Charge and the actual cost of wages for each month.
79According to the Statement of Claim, these terms were breached by the defendant Company, in that it failed in its obligation of upkeep for Out Paddock 1 and Out Paddock 2, thereby inflicting loss and damage on the partnership, and failed to upkeep the infrastructure on Farms 1 and 2, also inflicting loss and damage on the plaintiff partnership.
80Further, it was alleged that there had been a failure to pay the agreed rental for the out paddocks, thereby inflicting loss and damage on the plaintiff partnership.
81According to the Statement of Claim, the defendant Company overcharged the partnership for employee wages in a variety of ways, thereby inflicting loss and damage on the plaintiff partnership. Further, it was said that the Company failed to pay employee entitlements to casual workers, and underpaid casual employees’ superannuation benefits, thereby inflicting loss and damage. It was said that the Company’s failure to keep proper records as required under the joint venture agreement inflicted loss and damage on the plaintiff partnership with respect to the employment of Lachlan Jones in the period 2016 to 2017, thereby inflicting loss and damage on the plaintiff partnership, and further inflicted loss and damage by failing to produce employment records on request.
82According to the Statement of Claim, the Company retained possession and use of joint venture plant and machinery on Farm 1 to the exclusion of the plaintiff partnership, the relevant items being listed in Annexure H. Further, it was said that there were partnership plant and equipment items which should have been returned and were not (these were listed in Annexure I), thereby inflicting loss and damage.
83In particular, it was alleged that coffin troughs were wrongfully retained by the Company, and a claim for damages in detinue was made with respect to the coffin troughs. The loss and damage said to have been suffered by the plaintiff partnership was within the range of $47,736 at the low end up to a maximum loss of $119,340. The particulars subjoined to paragraph 53C of the Statement of Claim foreshadowed the provision of expert evidence at trial.
84Next, it was said, in breach of the terms of the joint venture the Company had failed to pay the partnership 50 per cent of the operating expenses of the joint venture as detailed in Annexure J, thereby inflicting loss and damage.
85Further, it was said that the condition of Farm 2 and the out paddocks was worse than at the commencement of the joint venture by reason of overgrazing and failure to fertilise. Accordingly, the plaintiff partnership had suffered further loss and damage.
86Finally, it was said that the various allegations against the Company, aside from being breaches of contract or entailing the tort of detinue, constituted breaches of fiduciary duty by the Company as against the plaintiff partnership, and that the Company had “failed to act honestly, in good faith and with fidelity in the best interests of the [plaintiff] partnership” and had put itself in a position of conflict where its interests conflicted with those of the plaintiff partnership, thereby gaining an advantage for itself at the expense of the partnership. Loss and damage was claimed in that respect accordingly.
87Finally, there was a series of claims in “bailment” relative to a Honda motorbike and a Holden Monaro. Damages in the sum of $14,110, being the replacement costs of the motorbike, were sought. As to the Holden Monaro, it was said that it had not been properly looked after, and its condition had therefore deteriorated. There was no nominated sum of money representing the amount of damages sought relative to the Monaro.
88As regards the second defendant, claims were made against him under the Water Act 1989 but were abandoned by amendment, and the claims in bailment were made against him rather than against the Company.
89Accordingly, as against the defendant Company there was a claim for (a) damages, (b) accounting of joint venture expenses, (c) an order for the return of each concrete [coffin] trough in the care, control and possession of [the defendant Company], (d) interest pursuant to statute, (e) costs, and (f) further and other relief. As regards the second defendant, Mr Craig Blain, there were damages sought relative to the Honda motorbike and the Monaro, together with consequential relief in the form of costs, interest, and further or other relief.
Defence and Counterclaim
90The Defence and Counterclaim seems to have undergone an even larger series of iterations and reiteration; the most recent one, dated 31 October 2024, being described as the “Trial Defence and Counterclaim”, having succeeded the third amended defence and the second amended counterclaim.
91Craig Blain and his Company admitted the existence of what was described as a Dairy Joint Venture Agreement being partly in writing, partly oral, and partly “implied by conduct”. The written portion of this agreement was said to be constituted by the document styled “Farming Agreement”. The oral portion was said to be constituted by discussions between the brothers, and implication by conduct was said to derive from some fifteen circumstances numbered A to O. They said there was an implied term of the agreement that each of the defendant Company and the plaintiff partnership “would be entitled to an accounting in respect of the joint venture”. This was described as the Accounting Term.
92Next it was said that either party might terminate the joint venture upon “reasonable notice to the other party”. Reasonable notice in the circumstances of 2018, it was said, was constituted by 4.5 months. This represented the time required for Craig, to Darin’s knowledge, to construct a new dairy using his own labour.
93Next it was said that it was a term of the joint venture “that any plant and machinery jointly purchased by the Partnership and the Company” would be paid for by each equally and used for the purposes of the joint venture, be maintained and repaired and the cost shared equally, and upon termination be retained by one or other of the Partnership or the Company, or sold, and the proceeds shared equally.
94Further, it was alleged that it was a term of the joint venture agreement that the Company could use the dairy on Farm 2 until the Company was able to obtain alternative milking arrangements.
95Further, it was said the law implied a term that neither party would “do anything to hinder or prevent the other from performing the Dairy Joint Venture Agreement”.
96According to the defendants, between 2012 and 2017 the plaintiff partnership and the defendant Company agreed to a series of variations to the joint venture to the effect that the venturers would have use of 52 acres of Out Paddock 2 on the basis of no rent being payable by the defendant Company, and the venturers each paying 50 per cent of the expenses to maintain that area while it was being used for the joint venture. Capital expenses on Out Paddock 2 were to be “the responsibility of the owner” of the out paddock. In around June 2014, the parties agreed that the Company would pay $18,480 inclusive of GST per annum from 1 November 2013 “as consideration for the partnership granting the use of Out Paddock 1 and Out Paddock 2 for the joint venture”.
97As to hired workers, in July 2012 it was alleged that the parties agreed from 1 July 2012 the Management Fee would increase to $1,068.72. In January 2014 the parties agreed that from 3 January 2014 the payment of the Management Fee would cease and the partnership would make monthly payments to the Company equal to the actual cost of employing the hired workers. From 1 May 2014 the arrangement would revert to the plaintiff partnership paying a management fee at the rate of $70,000 per annum plus Goods and Services Tax. From February 2017 the parties agreed that the payment of the Management Fee would cease, and the plaintiff partnership would make monthly payments to the Company equal to the actual cost to the Company of employing the hired workers.
98There then followed a series of admissions and denials of allegations in the Statement of Claim.
99As to the issue of rent for the out paddocks, they said that the Company made payment or tendered payment of the agreed rent.
100As to the provision and use of equipment, they relied on the provision in that respect to be found in the document styled Farming Agreement.
101As to the allegations relative to the employment of staff, the defendants said that the Company’s employment of staff was in accordance with the Dairy Joint Venture Agreement.
102As to the splitting of the herd, the defendants said that the plaintiff partnership and the Company “split the milking cows between them on a 50/50 basis by each taking possession of 50% of the milking cows”; and, as to the balance of the herd, contended that the partnership had taken possession of the miscellany of beasts described as “excess cattle” for the purposes of sale on behalf of the partnership and the Company.
103As to the allegation that the Company had failed to meet an obligation of “upkeep” of the out paddock, the defendants denied that the partnership had contributed the labour alleged, but in any event denied that the Company was under the alleged obligation. In any event, it was said that the works were capital works which, it was said, were specifically excluded as liabilities of the Company by the Farming Agreement.
104They dealt with allegations relative to gravel, which have not been pressed at trial.
105As to allegations of failure of upkeep of the two farms themselves, the defendants denied the existence of any term that the farms were to be “no worse off” at the end of the joint venture than at the beginning, and relied on provisions of the Farming Agreement excluding Cost.
106As to the claim for rent for the use of the out paddocks, they said they had paid the rent that was due, and denied liability on the tax invoice delivered in 2018.
107As to the alleged failure to pay 50 per cent of maintenance and repair costs for partnership plant and machinery, they said that the Company had paid the amount for which it was liable, and denied any further liability. The defendants denied the Company was obliged to contribute a “unit of labour” to the repair and maintenance of plant and equipment, referring to the Farming Agreement.
108As to alleged overcharging for employee wages, the defendant said the defendant Company was not obliged to “account to the Partnership for the difference between” the actual wage cost and the amount paid to the Company in that regard. In any event, it was said that such a claim was barred by s5(1) of the Limitation of Actions Act. They admitted that the Company was responsible for keeping employee records and ensuring that each employee received his or her employee entitlements, but otherwise denied the allegations in this respect. They said the Company was under no obligation to account to the plaintiff partnership “in respect of any alleged underpayment”, and that in any event the plaintiffs did not have standing to bring any claim for alleged non-compliance by the Company with its obligations to its employees.
109As to the coffin troughs, the Company admitted it had received demands for delivery of those troughs from or on behalf of the plaintiff partnership, and said it proposed to deliver five of those troughs “to an appropriate location, with the troughs remaining intact”, and indicated that such troughs were available for collection, but expressed concern that an attempt to remove them might result in their being damaged, and suggested a truck crane should be used. It was said no arrangement for collection was made. Any losses alleged by the plaintiff partnership to have been suffered by reason of deprivation of the troughs was said to be attributed either to provision of inappropriate food to the stock or to a failure to mitigate the partnership’s loss.
110As to alleged overgrazing, the plaintiffs denied that it had occurred, but, in any event, if “no worse off” obligation existed it attached to both venturers, and the plaintiff partnership was liable for the cost of 50 per cent of rectification.
111As to alleged failure to fertilise, they said that the “use of effluent and muck as fertiliser was the subject of oral agreement between Darin and Craig from time to time” and was determined “primarily by the needs of respective paddocks”.
112The defendants denied the allegation of breach of fiduciary obligations, alleging that the pleading was embarrassing and ought to be struck out.
113As to the bailment claims against the second defendant Mr Craig Blain, the defendants generally denied these allegations.
114By way of counterclaim, the plaintiffs alleged that:
“On or about 31 September 2018 [sic], being 1 month prior to the termination of the joint venture on 31 October 2018, the Partnership denied the Company access to Out Paddock 1 and Out Paddock 2 for the purposes of cutting fodder that Company had grown on behalf of the joint venture”. (CB 116)
115What had been retained by the partnership, it was said, equated to approximately 280 tonnes of dry matter of a good quality in the form of 700 bales of fodder. It said in the circumstances that the Company was entitled to use of the out paddock, and the partnership had failed to account for the 700 bales of fodder. It said the Company thereby lost $44,732.18, being the cost of replacement fodder.
116Alternatively, the defendants by counterclaim alleged the existence of what was described as the Initial Out Paddock Lease deriving principally from the clause in the Farming Agreement under the heading “Use of Out Paddock”. Whilst the Company was liable for 50 per cent of the maintenance expenses, capital expenditures were for the account of the owner of the out paddocks. The leasing arrangement was, it was said, varied as from June 2014, whereby the Company would pay rent of $18,840 including Goods and Services Tax, would pay 50 per cent of the maintenance expenses of the two out paddocks, with the owner meeting capital outlays. It was said that the Company:
“was entitled to enter Out Paddock 1 and Out Paddock 2 for a reasonable time after termination of the Out Paddocks Lease for the purpose of harvesting and removing the crops to which the Company was entitled”. (CB 122)
117The restriction said to have been imposed “on or about 31 September 2018 [sic]” thereby inflicted loss and damage.
118As to the second mortgage, according to Craig, Darin had agreed to payment of interest at 5 per cent per annum in lieu of the originally stipulated 7 per cent. In so far as arrears of interest were included as part of the payout figure on the second mortgage, and were paid by Rabobank on behalf of Craig. This was done by “mistake of fact”, and “Craig has suffered loss in the sum of $7,583.33”.
119According to the defendants, the plaintiff partnership had failed to pay Invoices 49, 50 and 51 rendered to it respectively on 31 August 2018, 30 September 2018, and 31 October 2018, for 50 per cent of the joint venture costs, totalling $53,492.40.
120The defendants alleged that the plaintiff partnership had “converted” what were described as the excess cattle: that is, all those in excess of the milking cows which had been equally divided between the Company and the partnership. They claimed an entitlement to 50 per cent of the “excess” cattle, and that the partnership had agreed to sell them and account to the Company for 50 per cent; which failure to account led, it was said, to a loss for the Company of $33,250.
121In so far as the plaintiff partnership retained the proceeds of delivery of milk delivered on the morning of 1 November 2018, the defendants said that since this consisted partly of milk expressed the previous evening, 31 October, the partnership was liable to pay the Company 50 per cent of that amount.
122The Company and Craig Blain alleged wrongful detention by the Company of a series of items left on Farm 2 following the determination of the joint venture, which items had not been returned despite demands from the defendants’ solicitors. The counterclaim sought a variety of relief, including a liquidated sum of $62,851.15, damages, equitable compensation or equitable damages, delivery-up of retained items, and consequential relief.
Reply and Defence to Counterclaim
123By their reply, the plaintiff partnership denies that it had bound itself to the Farming Agreement, saying that it had “expressly rejected the terms and conditions” of the document titled “Farming Agreement” in or about February 2012, when Rabobank, by its representative, Nicholas Sinclair, produced a written document by that title to Darin on behalf of the partnership in the presence of Craig and Talia Blain. This meeting was said to have taken place “on the back porch of Craig and Talia’s house”. In any event, it was said that “at no time before 3 July 2018 [that is, at the mediation convened by Mr Moncrieff referred to earlier] was the Partnership aware that the terms and conditions of the Rabobank proposed farming agreement were relied on by Craig and/or the Company”. They relied upon an admission in a letter from the defendants’ solicitors to the effect that the Farming Agreement was unsigned. (Letter dated 25 September 2018.) They complained of a failure to produce a signed copy of the agreement by way of discovery or otherwise. Accordingly, it was said, there was no proper basis for pleading this agreement as required by s18(d) of the Civil Procedure Act 2010, and reliance upon it was, it was said, contrary to the overarching obligation under that statute.
124The plaintiffs referred in detail to Rabobank’s letter of offer, saying “no executed farming agreement exists or ever existed”.
125There follows a series of close-grained admissions, but predominantly denials and counter-allegations as to terms between the parties. As to the allegation of conversion of the “excess cattle”, the plaintiff partnership agreed that it took possession of the bulls, which it said were not part of the herd and were at all times its sole property, and as to Friesian heifers, said that they were abandoned by the Company because of their poor health.
Conclusions
126The defence to counterclaim generally denied the matters alleged by the defendants in their counterclaim.
Basis of adjudication
127On 20 December 2023, her Honour Judge Aileen Ryan made consent orders in chambers as to the trial of this matter, including inter alia the following order:
“1.Pursuant to rule 47.04 of the Rules, all remaining paragraphs of the FASOC and the 2FAD shall proceed at the trial listed for 6 February 2024 other than:
a.paragraphs 19 and Annexure C, 21 and Annexure D, 26 and Annexure E, paragraph 50 and Annexure H, paragraph 53 and Annexure I, 53B and 53C, 54 and 55 and Annexure J, 70 and 95 of the FASOC; and
b.paragraphs 108, 108J and 137 of the 2FAD.” (CB 197)
128The following year, on 17 October 2024, Judicial Registrar Bennett modified her Honour’s orders as follows:
“4.Paragraph 1 of the orders of her Honour Judge Ryan dated 20 December 2023 are varied such that pursuant to Rule 47.04 of the Rules, all remaining paragraphs of the second further amended statement of claim and the second amended counterclaim shall proceed at the trial listed for 6 November 2024 other than:
a.paragraph 19 and Annexure C, paragraph 21 and Annexure D, paragraph 26 and Annexure E, paragraph 50 and Annexure H, paragraph 53 and Annexure I, paragraphs 53B and 53C, 54 and 55 and Annexure J, and paragraphs 70 and 95 of the second further amended statement of claim; and
b.paragraph 137 of the second amended counterclaim.” (CB 201)
129This rather arcane “split” was, as I understand it, proposed by the parties rather than by either the learned Judge or Judicial Registrar. Whilst the delineation may have been clear to counsel, a number of attempted clarifications left me confused rather than enlightened. (See T2172, L25 – T2174, L21).
The Farming Agreement: genuine or forgery?
130The genuineness or otherwise of the alleged Farming Agreement (see paragraph [21] above) is of crucial importance. After initial denials, Rabobank was able to locate what purported to be an executed copy of the Farming Agreement. The plaintiffs allege that what purported to be signatures by Mr Darin Blain and his wife Sally are forgeries. I have already summarised Darin’s evidence in that respect. His wife Sally gave evidence that in 2011 she did not attend any of the meetings with Mr Sinclair of Rabobank; likewise in 2012. (T1084, L18-21) She said that she first saw the Farming Agreement, or alleged Agreement, in September 2018. (Ibid, L22-30) She denied being at the offices of Jellie McDonald on 5 December 2011, the date that the agreement or alleged agreement bore. (T1085, L3-6) It was in February 2024, she said, that she first became aware that she was alleged to have signed this agreement. (Ibid, L14-16) She said she was not present at the mediation in July 2018. (Ibid, L29) She denied authorising anyone to apply her signature to this agreement. (T1086, L14-15)
624. The Court Book contains tax invoices for the October 2011 to December 2011 harvest:
(a)Townsend Contractor, dated 30 October 2011, for 77 silage rolls.
(b)Nick and Karen Blain, dated January 2012 for 655 rolls of silage and 162 rolls of hay.
625. In total: 732 rolls of silage and 162 rolls of hay.
626. The taking of accounts between fiduciaries, means the benefit received by this harvest by the Company needs to account for this benefit. (Closing Submissions, paragraphs 622-626)
522Next, Ms Harris referred to what she described as “Partnership’s counterfactual submissions”, [106A], [108A]. These references seem to be to the plaintiffs’ Reply and Defence to Counterclaim. She said these paragraphs and part of the plaintiffs’ case raised two issues: first, that a remedy for breach of contract ought not to put the aggrieved party in a better position than it would have been had the contract been observed. She said:
“The Partnership recognising the obligation to account for its harvest (here, sileage) as a fiduciary, would place the Defendant in the position it would have been in if the JV accounting had occurred on or after 31 October 2018. There is no loss.” (Closing Submissions, paragraph 627(a))
523And secondly, she said:
“It was inevitable that the [defendant] Company was going to have purchase hay. There is no causal connection between the alleged breach by the Partnership of an implied term – that did not arise one [sic] or before the commencement of the JV – and the purchase of the hay.” (Closing Submissions, paragraph 627(b))
524At paragraphs 628-640 she referred to a large number of items of evidence as to the cutting, availability and storage of hay during the term of the joint venture, concluding at paragraph 640:
“On balance, the Defendants have not proven breach, and even if breach was proved, there is no loss arising from the breach, as the Partnership will account for the sileage cut before 31 October 2018.” (Closing Submissions, paragraph 640)
525A number of points need to be made at the outset. First, whilst the statement of claim seeks an accounting of joint venture expenses, there is no prayer for relief for accounting generally, much less for accounting of a silage harvest. At paragraph 107(d) of the reply it is stated:
“... the Company must account to the Partnership for silage and hay from Farm 1 and the Company’s Out Paddock, located on Shurvells Road, during comparable periods of time.”
526This pleading cannot add to the relief sought in the statement of claim. The Reply and Defence to Counterclaim does not purport to raise any new cause of action, and perhaps it would have been incompetent for this to be done: see Rule 13.09(2), which states:
“A party shall not in any pleading make any allegation of fact, or raise any new claim, inconsistent with any allegation made or claim raised in a previous pleading by that party.”
527The counterclaim relative to the “land lease” is for common law damages, not for an accounting as to income from the partnership. The statement of claim seeks an accounting for joint venture expenditure only. In my view, it is not competent for the plaintiffs to raise the issue of accounting for joint venture income by a sidewind in their defence to counterclaim. This might have been pleaded as an equitable setoff, but it has not been done in this way.
528All in all, this knotty pleading issue arises out of the unhappy decision that these parties appear to have made to create what was, to all intents and purposes, a partnership, but to set their faces against the Partnership Act 1958 and its traditions, structure, rules and remedies. In their dealings relative to the out paddocks, the brothers and the defendant Company conducted themselves on the basis that the Company was to be treated as tenant of the out paddocks, paying 50 per cent of the rent which might otherwise have been payable. This represented a distinct variation from the Farming Agreement. Darin referred to the amount payable as rent, not a modification of joint venture income. He referred to the relationship as being a “land lease”.
529It would have been preferable, in my view, if matters had been structured differently. Given that the parties have structured matters in the way that they have, the analysis advocated by Mr O’Haire, based on the common law of landlord and tenant, appears to be the correct one.
530Ms Harris correctly observed that in so far as the defendant’s claim is for deprivation of rights over Out Paddock 2, terminating on 31 October 2018, it would not seem appropriate to fix damages based on what might have been harvested by way of silage after 31 October. On the other hand, if the Company had retained access to harvest on Out Paddock 2 in the knowledge that its rights in that regard would terminate on 31 October 2018, it is reasonable to suppose that it would have ensured that harvest operations for silage for its advantage would have been concluded by that date. The notice served by the plaintiffs was, in my view, repudiatory. Ms Harris correctly observed that in so far as Ms Sally Blain joined in the giving of the notice, her involvement was mere surplusage. It did not, however, deprive the notice of its repudiatory character.
531For these reasons, the first defendant’s counterclaim as to the cost of hay succeeds.
532The next item of counterclaim refers to an alleged overpayment through the agency of Rabobank of the amounts owing by Craig to Darin under the second mortgage securing Darin’s vendor finance. These matters are referred to at [71]-[72] above. The case for Craig was that Darin agreed successively to a reduction of the nominal rate of 7 per cent per annum interest under the second mortgage, first to 6.5 per cent and then to 5 per cent. The “payout” was calculated by reference to an interest rate of 6.5 per cent. Craig’s counterclaim is for repayment of all interest charged above 5 per cent for the purposes of calculating the payout figure, on the basis that those moneys were paid under a mistake of fact, viz that the relevant interest rate was 6.5 per cent rather than 5 per cent. It was not suggested that Craig was mistaken on this point; rather, a mistake was made by his agent, Rabobank. Mr O’Haire conceded that Darin denied having agreed to the reduction. (T410, L12-29) He said Darin agreed in cross-examination that Craig had requested an interest rate reduction (T823, L25-29) Darin agreed that Craig paid a principal reduction in August 2016. (T820, L29-30) Darin had agreed to a reduction of the 7 per cent per annum interest rate to 6.5 per cent. (T822, L21-23) Darin agreed that there was a discussion in which Craig requested a reduction in the interest rate. (T823, L1-4) He denied, however, that he agreed to drop the rate to 5 per cent per annum. (Ibid, L14-15)
533Ms Harris said her clients accepted that the interest rate on this mortgage loan was reduced to 6.5 per cent per annum as from June 2014. (Closing Submissions, paragraph 644) She referred to the Memorandum of Common Provisions which pertained to the second mortgage (CB 1989-2008); in particular, clause 31(11)(ii) which stated:
“the failure of the Mortgagee to exercise any power or discretion given to it by this Mortgage shall not, unless agreed by the Mortgagee in writing, constitute a waiver by the Mortgagee of the right of the Mortgagee at any time thereafter to require the Mortgagor to comply strictly with the provisions of this Mortgage.” (CB 2007)
534She said at Closing Submissions, paragraph 649, that it would have been competent for Darin to insist on payment at the rate of 7 per cent per annum; the reduction of rates agreed to in June 2014 not having been documented in writing. If, which was denied, there were a purported reduction of the rate to 5 per cent, it was competent for Darin to insist at the time of payout upon receipt of interest up to 6.5 per cent. She said that in so far as Craig had commenced paying interest at the rate of 5 per cent rather than the reduced 6.5 per cent rate, this was a breach of contract. (Closing Submissions, paragraph 650-1) It seems Darin did not initially notice the reduction in interest rate, as it was accompanied by a reduction in the principal sum which would in any event lead to a reduction in the amount paid by way of interest even if the rate were not varied. She said Darin had the assistance of his sister-in-law in calculating the payout figure at $207,583.33. (CB 751-753) She said that by virtue of clause 6 of the Memorandum of Common Provisions (CB 1992), when the agreed interest was not paid Darin could have applied the rate published under the Penalty Interest Rates Act 1983 but did not do so (Closing Submissions, paragraph 655-8), nor did he capitalise the arrears as he was entitled to under these boilerplate provisions. In those circumstances it could not be said that there had been any failure of consideration. (Closing Submissions, paragraph 659) According to the latest version of the Defence and Counterclaim, the larger payout figure of $207,583.33 was paid by Rabobank by reason of the mistake of fact (paragraph 115), and such moneys were recoverable by Craig as moneys had and received (paragraph 116).
535The fundamental question therefore seems to be whether the payout made by Rabobank on behalf of Craig was the correct figure or not. If it was the correct figure there was no mistake, and the claim must fail. If the full amount paid over by Rabobank was in fact payable, it would not be to the point that there might have been a mistake involved in the payment, whether by Craig or Rabobank: Platemaster Pty Ltd v M & T Investments Pty Ltd [1973] VR 93 per Gowans J.
536It should also be noted that Craig has already been recouped for the alleged overpayment, albeit from Rabobank rather than from his brother Darin ([74] above).
537The mistake here, if there be one, was made by Rabobank, not by Craig. As to this point, Mr O’Haire said (Closing Submissions, paragraph 29):
“By logical extension of these principles [viz, those relating to payments made under mistake], a payment made under bona fide mistake of fact by an authorised agent for an individual principal can be recovered, provided that the principal does not know that the agent is making the payment on an erroneous basis.”
538In this case the “agent” would be Rabobank, and the principal Craig. According to Mr O’Haire, this conclusion derived from the established proposition that:
“where the payment is made under a bona fide mistake of fact by an authorised agent of a company, the fact that some other agent of the company may have had full knowledge of all the facts does not disentitle the company to recover the money so paid, provided that the agent with the full knowledge does not know that the payments are not made on an erroneous basis.” [I wonder if there isn’t a “not” in this proposition which does not belong.] (Closing Submissions, paragraph 28(c)
539Mr O’Haire referred to Simos v National Bank of Australasia Ltd and Guelman (1976) 10 ACTR 4, 14-15, per Connor J; Anglo-Scottish Beet Sugar Corporation Ltd v Spalding Urban District Council [1937] 2 KB 607, 627 (Atkinson J); and Turvey v Dentons (1923) Ltd [1953] 1 QB 218, 224-5. According to Mr O’Haire, the fact that Craig had already been recouped for his allegedly mistaken payment was no bar to recovery against the plaintiffs or Darin individually. He referred to Roxborough v Rothmans of Pall Mall Australia Ltd (2001) 208 CLR 516. (Closing Submissions, paragraph 30) In the Roxborough case, a vendor of tobacco products was found entitled to recover outlays by way of an invalid and unconstitutional excise duty, despite having recouped itself already by passing the impost on to its customers.
540Ms Harris’s point was that since any reduction of interest was not documented, the effect of the passages from the Memorandum of Common Provisions forming part of the mortgage meant that any interest reduction, even if agreed upon, was not legally enforceable. This might be regarded as a highly legalistic and unmeritorious contention. On the other hand, it seems at a moral level no less unmeritorious than Craig’s attempt to obtain a double recovery of the alleged overpayment. This counterclaim fails.
Joint venture expenses
541Paragraphs 117 and 118 of the latest version of the defendants’ Defence and Counter Claim seek payment of the sum of $53,492.40 said to be an unpaid amount of joint venture expenses claimed by the defendant Company: by Invoice 49, dated 31 August 2018, $44,450.03; Invoice 50, dated 30 September 2018, $3,186.26; and Invoice 51, dated 31 October 2018, in the sum of $5,856.11.
542As to the first of those invoices, No 49, dated 31 August 2018, I pointed out to Craig that at the time of its issue a mediation had failed, a tax invoice with what purported to be a termination of the “land lease” relative to the out paddocks had been dispatched under an email dated 19 July 2018, and Darin had sent an email to his account manager at Rabobank, Mr Terry McMahon, which in effect announced the commencement of hostilities between the brothers ([51]-[52] above). I summarised the situation in these terms:
“In effect, the gloves are off, the knives are out at this point?”
543Craig replied:
“Well, yes, your Honour, but we were still acting in good faith at that time and Darrin [sic] had again given us the bundle of monthly expenses to be paid and we paid the entirety of the expenses and invoiced Darrin [sic] or the partnership for 50 per cent.” (T1384, L30 – T1385, L11)
544Mr O’Haire (Closing Submissions, paragraph 228), referring to Invoice 49, said Darin continued the practice of furnishing invoices to Craig in the expectation that the defendant Company would pay them. He referred to Craig’s evidence to this effect.
545When Darin was giving his evidence-in-chief, I asked him why the plaintiffs did not pay the amount invoiced to them under Invoice 49. The question was repeated by Ms Harris, and Darin replied:
“We just decided not to because we knew the joint venture was ending so we sort of allowed them to make that payment to see how it rolled, otherwise I may have been here looking for another 44 grand.” (T596, L18-22)
546Ms Harris (Closing Submissions, paragraph 673) stated:
“The Partnership accepts that it is indebted to the Company in the sum of $53,492.40, as claimed in [119] of the further amended counterclaim.”
547She complained that these matters were made good by the production of undiscovered documents, and “unnecessary costs have been incurred, and court resources used to pursue a claim that could have readily been dealt with prior to trial.” (Closing Submissions, paragraph 674) I take that to mean that, subject of course to a potential offset against the amounts held to be owing by the defendants or one or other of them on their claim, this element of the counterclaim should succeed.
Excess cattle
548According to paragraph 124B of the latest version of the defendants’ Defence and Counterclaim, at the end of the joint venture the defendant Company:
“was entitled to possession of 50% of the intermingled dairy herd, including the Excess Cattle ... pursuant to the terms of the Lease of Dairy Herd.”
549The phrase “Excess Cattle” was defined in paragraph 17 of the Defence and Counterclaim as being:
“1)6 Friesian Bulls (mature);
2) 3 Jersey Bulls (mature);
3) 2 Friesian Heifers (rising 3yr old);
4) 5 Friesian Heifers (rising 2yr old);
5) 4 Friesian Heifers (rising 1yr old);
6) 4 Crossbred steers (rising 2yr old);
7) 4 Crossbred steers (rising 1yr old).”
550The “Excess Cattle” were in addition to the 26 heifers and 32 calves, each of which represented the division of the dairy herd between the plaintiff partnership and the defendant Company. The “Excess Cattle”, according to paragraph 17 of the pleading, were taken into the plaintiffs’ possession for sale on behalf of the plaintiffs and the defendant Company. According to paragraph 124B, the plaintiffs were aware that the defendant Company “intended to exercise its option under the Lease of Dairy Herd to purchase” its half of the herd. The plaintiffs were aware of this because of a letter from the defendants’ solicitors to the plaintiffs’ solicitors dated 25 September 2019, according to the Defence and Counterclaim. The agreement for the sale of the Excess Cattle to be made by the plaintiff partnership was said to have been reached orally in a conversation between Darin and Craig.
551According to paragraph 124E of the Defence and Counterclaim, the plaintiffs either did not sell the Excess Cattle or, if they did, they did not pass on 50 per cent of the proceeds of sale to the defendant Company. According to paragraph 124F, this inflicted damage on the defendant Company in the sum of $33,250.
552In support of this counterclaim, Mr O’Haire referred to evidence of Craig at T1404, L13-21, to the effect that he and Darin agreed that the plaintiffs would retain possession of the Excess Cattle, sell them, and account to the defendant Company for half of the proceeds of sale. Mr O’Haire then referred to evidence of Darin where he said:
“I don’t remember the exact conversation, your Honour, but they were probably going to be sold. We are not denying that we didn’t end up with them, we just don’t know where they went because when we did can [sic] the split at the block – so half went that way and half went on to a truck so we don’t know how many went on to a truck and how many more stayed behind. We know it was maybe one, two or three, but we can’t – the records just aren’t good enough to work out whether they all stayed there or some went on the truck.” (T1043, L23 – T1044, L1)
553The truck was taking the stock to Craig’s, which was 20 minutes away from Out Paddock 2. (T1044, L2-5) I asked how many Excess Cattle were the plaintiffs left to dispose of, and Darin replied:
“... according to the records, I think there was five. Now, we put them down that they stayed because we probably can’t find where they went.” (Ibid, L13-16)
554Of this five, the only one whose fate he could confidently state was one which was retained as a pet for his daughters, and had since died. (Ibid, L18-23) As to the other four, he could give no further information. (Ibid, L22-26)
555Mr O’Haire said the defendants’ account was supported by a contemporary cattle register created at the time the herd was divided. (CB 833-841) He said this was annotated with words such as “sell” or “to be sold” in the handwriting of Craig and Darin. He referred to Darin’s evidence (T1040, L11-17 and T1061, L1-9) where Darin agreed that the register was a document used “when the preg test was taking place”. This “preg test” was part of the process of dividing the herd. Darin agreed that both his writing and Craig’s writing appeared on the document.
556Ms Harris (Closing Submissions, paragraphs 675-699) contended that the Cow Lease agreement and, if it applied, the Farming Agreement, had overriding effect, and were inconsistent with the arrangements alleged in the Defence and Counterclaim. The Cow Lease is dated 5 December 2011, in what seems to be the same hand that dated the Farming Agreement. The document is to be found at CB 763-774, with execution clauses for Darin and the defendant Company at page 772. The term of the lease (Item 3) is said to be “Eight years starting on the commencement date”, namely 15 December 2011. Paragraph 31 grants the defendant Company an option to purchase “the reversionary interest in livestock”, which might be exercised “at any time during the final year of the lease by giving written notice to the lessor”. The word “livestock” is defined in clause 1, CB 764, as follows:
“ “Livestock” means the livestock described in item 1 of the Schedule, any replacement livestock and any progeny reared for the purposes of replacement, but shall not include any excess progeny.”
557Livestock as described in the schedule under Item 1 is as follows:
“The dairy herd belonging to the vendors [sic] as at the commencement date, depastured at the property described in Item 6, comprising 130 cows, 35 heifers and 35 calves.” (CB 773)
558Excess progeny is defined in paragraph 1, CB 663, to mean:
“The progeny of the livestock not required as replacement livestock.”
559The phrase “Replacement livestock” is defined in the same clause to mean:
“progeny of the livestock reared by the lessee for replacing rejected livestock or livestock purchased by the lessee to replace rejected livestock.”
560The phrase “Rejected livestock” was defined to mean:
“any of the livestock which are destroyed or die, or which, in the opinion of the lessee, become unsuited or unfit for milk production, whether by reason of age, deformity, disease, deficiency in milk production or any other reason recognised according to the best methods of dairy livestock husbandry.”
561Ms Harris (Closing Submissions, paragraph 677) said that:
“Bulls and steers are not replacement cows and are not reared for the purpose of replacing any cows, female heifers or female calves. It is clear that bulls are excluded from the Cow Lease.”
562In the following paragraph she said the Farming Agreement did not refer to bulls, replacement cows and excess progeny. She said at paragraph 690 that the split as alleged by the defendant Company was consistent with clause 31 of the Cow Lease, and, if it applied, clause 3 of the Farming Agreement.
563At paragraph 682 of her Closing Submissions, Ms Harris referred to a letter from the defendants’ solicitors, Maddens, dated 25 September 2018, which referred to the defendant Company’s option to purchase under clause 31 of the Cow Lease and called for a “drafting” of stock 50:50 as per the terms of the Farming Agreement. She referred to a further letter by way of email from Maddens dated 30 November 2018, stating inter alia:
“I am instructed that all livestock has been drafted off to the parties’ mutual satisfaction.” (Closing Submissions, paragraph 684)
564Therefore, said Ms Harris (Closing Submissions, paragraph 685), the defendant Company made no claim for stock beyond the 50/50 split, and the letter from its solicitors dated 30 November 2018 constituted an effective “closing of the accounts” on this subject.
565She noted at paragraph 691 that:
“Clause 14 of the Cow Lease provided in effect that when the Lease ended, the [defendant] Company was to peacefully surrender and yield up to Darin, the whole of the livestock in good health and condition in all respects.”
566She said Darin had been considerate in allowing a mustering of the dairy herd before the $50,000 residual payment provided for in the lease had been met. (Closing Submissions, paragraph 695)
567In the previous paragraph, she said:
“The bulls and steers were not governed by the Cow Lease unless they were ‘excess progeny’. There is no evidence that any bulls or steers were regarded as or treated as ‘excess progeny’ by either JV party. The evidence was that the bulls were used to cover cows, and the steers fed the family. There is no evidence that Craig or the Company purchased any bulls or steers. Darin’s evidence about what livestock he owned at the commencement of the JV should be accepted as reliable.” (Closing Submissions, paragraph 694)
568Mr O’Haire (Closing Submissions, paragraph 269) referred to clause 23 of the Cow Lease, which stated as follows:
“23.(1) The lessee may sell or keep and retain any excess progeny reared in any year and such excess progeny or the proceeds of sale thereof shall be the property of the lessee, PROVIDED HOWEVER the lessee shall not keep and rear any excess progeny in excess of that agreed between the lessor and the lessee.
(2)All other progeny of the livestock not otherwise required by this lease to be kept or otherwise provided in subclause (1) above, shall be sold by the lessee and the proceeds thereof shall belong to the lessee.” (CB 767-768)
569The definitions of “excess progeny” and “replacement stock” are as follows:
“ “Excess progeny” means the progeny of the livestock not required as replacement livestock.
“Replacement livestock” means progeny of the livestock reared by the lessee for replacing rejected livestock or livestock purchased by the lessee to replace rejected livestock.” (CB 763-764)
570As Ms Harris correctly observes, the “Cow Lease”, as she describes it, does not extend to bulls at all, unless the bulls are to be treated as “excess progeny” and are not governed by the terms of the lease. Neither the lease nor the Farming Agreement creates immutable terms; nor do they lay down any formalities for effective variation (cf the Memorandum of Common Provisions for the vendor finance second mortgage over Farm 1). These beasts over and above the 50/50 split could be the subject of any arrangement which Darin and the company saw fit to arrive at for the “drafting” of the stock. Ms Harris was critical of the manner in which the counterclaim on these matters was pleaded, stating (accurately) that there was not a ground alleged which would have given title to the company.
571The counterclaim was, in this respect, elliptical. However, what it boiled down to was that whatever might have been the title situation as to the comingled herd, and whatever the Cow Lease might or might not have provided – or the Farming Agreement, what the parties agreed to do was to split the operative herd 50/50 and to commission the plaintiffs to sell the rest and split the proceeds 50/50.
572Darin did not seem to deny that this was the agreement on the day. He pleaded ignorance based on a lack of records. I found this denial unconvincing. The split between the brothers was bitter. This litigation has been pursued to a degree of detail and pettiness which I have found unexampled in 30 years as a tribunal member and judge. In this atmosphere it is inconceivable that Darin would have been so indifferent as to what was going on, as the stock were being drafted and divided, as he claims he was. In those circumstances I treat his plea of ignorance, which seems to boil down to the equivalent of a plea of “do not admit”, as equivalent to an admission. The letter relied on from the defendants’ solicitors, Maddens, dated 30 November 2018, expressing satisfaction on their clients’ behalf with the “drafting” of the cattle, does not, as Ms Harris contended, represent an acknowledgment that what occurred was entirely satisfactory to the defendants, therefore blocking any claim they might now make. I accept Mr O’Haire’s contention that the letter means no more than that, as to the excess cattle, what was agreed upon on the day was satisfactory to the defendants, not that such agreement had been carried into effect.
573This item of the counterclaim succeeds. Craig gave evidence, which I accept, which is referred to by Mr O’Haire (Closing Submissions, paragraph 279-296), as to the existence of the stock the subject of the counterclaim.
Items allegedly not returned
574Perhaps responsively to the range of claims mounted by the plaintiffs as to tools and other pieces of equipment, the defendant company claims a series of items (even including another car wreck and miscellaneous automotive items). According to Mr O’Haire, these items were referred to in letters of demand from the defendants’ solicitors to the plaintiffs’ solicitors dated 25 September 2018 and 18 March 2019. (CB 1895 and 1911)
575The first item is a vehicle hoist which Mr O’Haire said Darin conceded was purchased second-hand by Craig from Adam Rowe. (T662, L10; T891, L2-15) The hoist required bolting to the floor (T892, L11-15), though it could be removed (T892, L19-28) Darin agreed in cross-examination that he had offered the return of the vehicle hoist, but has since adopted the position that it was not appropriate to return, since it was a fixture. (T893, L2-10) Darin agreed that the hoist could be removed, stating:
“It could be but we would require an electrician to do it because it’s hard wired in. So there’s no plug to unplug, it’s hard wired into the 480 – or 240 volt.” (T893, L13-17)
576Ms Harris (Closing Submissions, paragraphs 701-710) reviewed the evidence on this subject in detail, including the evidence from Adam Rowe. I did not understand the detail to invalidate the summary of the substance advanced by Mr O’Haire. She said, however, that the evidence of Mr Rowe gave a different aspect to that. He described the circumstances in which the hoist came to be installed at Farm 2, describing a sale agreement with Craig, and continuing:
“So we pulled it all apart a few months later and we shifted it around to farm 2, which Craig had put a new workshop floor in, in the shed there and fixed the roof up ... we had it ready to be put in there and we set it all up in there and Craig used to use it around there then.” (T2084, L31 – T2085, L5)
577Mr Rowe said he was paid $1,300, having purchased the item for $4,000. (T2085, L13-14) He described moving the item, stating “[we] shifted it with a car trailer in pieces”. (Ibid, L30-31)
578This evidence might raise a question as to whether the company is the correct counterclaimant, as distinct from Craig, who was said to have made the purchase. Since both are parties to the proceeding, this issue, if it be a genuine one, will be readily soluble. The more difficult issue is whether Darin is correct in taking the position that the hoist is a fixture, not a mere chattel. Ms Harris, drawing attention to Mr Rowe’s evidence, said it showed that a new concrete floor was required at Farm 2 for the installation, and that the hoist was of such complexity and size that it required disassembly and reassembly to be moved. It was not a simple matter of unbolting and unplugging.
579Mr O’Haire referred to long-established authority, and in particular the relatively recent decision of the High Court in TEC Desert Pty Ltd v Commissioner of State Revenue (WA) (2010) 241 CLR 576, 505 [24] in the joint judgment of French CJ, Gummow, Heydon, Crennan and Kiefel JJ, and the decision of Kay’s Leasing Corporation Pty Ltd v CSR Provident Fund Nominees Pty Ltd [1962] VR 429, 432−3. He said (Closing Submissions, paragraphs 21-24) that determining whether an item was a fixture or remained a chattel required a consideration of the degree and the object of annexation, noting that affixation to land in itself does not conclusively render an item a fixture, though it does raise a presumption. If an item is affixed merely for its better use as a chattel, it is not to be reckoned a fixture; whereas if the intention is to enhance the realty, it is.
580As I remarked when the evidence as to the vehicle hoist was being given, these principles are long-established and capable of clear statement in the abstract. Their application in particular instances, however, is problematic. In contentious instances, it is often possible to derive both a purpose better to enjoy the item as a chattel and to enhance the realty as objects of the annexation. Here, it seems, according to Mr Rowe’s evidence, that a workshop was being established on Farm 2. Part of that establishment was the installation in an existing structure of a new concrete floor. Installing a wired-in and bolted-down vehicle hoist could be seen as enhancing Farm 2 by the installation of a workshop or the enhancement of an existing structure as such. As to the bolting-down and wiring, one could regard them as enhancing the hoist as a chattel so as to (a) hold it steady and (b) give it a source of power. On balance, I believe the matters urged by Ms Harris would render this hoist a fixture rather than a chattel, and this item of the counterclaim fails.
Green HQ Holden
581Ms Harris said that the green HQ Holden sedan was identified in a photograph at CB 1924. She said the plaintiffs were not willing to return it, “as it was there when Darin purchased Farm 2 back on 11 June 2003”. She referred to the agreed chronology, page 1, item 3. There was no claim for this item, she said, until the end of the joint venture. She referred to Darin’s evidence at T664, L12-24. She said that according to Adam Rowe’s evidence (T287, L14-18) the vehicle had been placed in a shed on Farm 2 in 1996 or 1997 and had not been moved since. She referred to Darin’s evidence that the vehicle had no frame or wheels, and he had not moved it because he could not get it out of the shed. (T895, L7-11) In so far as there had been an agreement for return of certain items arranged by brother Paul Blain as an intermediary, she returned to Darin’s evidence (T900, L29 – T901, L5) She said Darin’s refusal to return this vehicle was “consistent with his belief that the car had been abandoned more than 30 years ago.” (Closing Submissions, paragraph 720) She referred to a decision of the Northern Territory Supreme Court, Neave v Trenerry [1999] NTSC 3 [10], where Bailey J said that “abandoned” did not simply mean merely “lost” or “left”:
“It means that the owner has intentionally relinquished all rights of ownership in the property”.
582Ms Harris also placed reliance on the Limitation of Actions Act 1958.
583Mr O’Haire said (Closing Submissions, paragraph 311) that the position taken by the plaintiffs relative to the green HQ Holden was inconsistent with Darin continuing to assert title to the Monaro which was left on Farm 1. Mr O’Haire referred to a letter from the plaintiffs’ solicitors dated 9 April 2019 (CB 1912-1914) where that firm stated, inter alia:
“The following items can be collected at your clients risk upon the return of my clients HQ GTS Monaro with the original disc break [sic] front end and diff (removed by your client) correctly fitted back into the vehicle along with the correct V8 tail shaft:
...
• HQ Holden Sedan (Green)”
584If the protagonists in this dispute were not members of the same family I would be inclined to accept Ms Harris’s contention that the circumstances and the passage of time denoted an abandonment of the green HQ Holden. Where, however, the item was left on land occupied by a member of the family – a close relative such as a brother, who was for a substantial period of time engaged in a joint venture with the other brother – I do not believe any inference of abandonment should be made.
585The cause of action asserted as to these counterclaim items is in detinue (Defence and Counterclaim, paragraph 136). In those circumstances, the cause of action does not accrue until the making of the demand, and therefore the relevant limitation period had not expired.
586This counterclaim item succeeds.
Holden front door (golden colour)
587Ms Harris (Closing Submissions, paragraph 728-732) said that it had not been proven that Darin was in possession of this door. Mr O’Haire condemned Darin’s evidence on this point as being “evasive”. This is an instance of an “oath against oath” conflict. For reasons previously given, I generally prefer the evidence of Craig to that of Darin. Ms Harris observed that Darin’s wife was not asked about this car door, nor was Jayden or brother Paul.
588This counterclaim item succeeds.
Two Holden boot lids (green in colour)
589Ms Harris (Closing Submissions, paragraphs 735-738) stated that the plaintiffs deny liability relative to these items on the basis of abandonment and the expiry of the limitation period. For the same reason that I did not accept the assertion of abandonment relative to the green Holden HQ, I reject this claim. Likewise, since the claim is one in detinue, the Limitation of Actions Act defence fails.
590This item of the counterclaim succeeds.
Retained milk income
591Paragraph 129 of the latest version of the defendants’ Defence and Counterclaim alleged:
“The [plaintiff] Partnership has retained the milk income derived from the milking of the [plaintiff] Partnership and the [defendant] Company’s intermingled dairy herds on 31 October 2018 and 1 November 2018.”
592According to the particulars, the income in question was $3,550.84, for which, according to paragraph 130 of the Defence and Counterclaim, the plaintiffs were liable to pay the company 50 per cent. Ms Harris (Closing Submissions, paragraph 279) said it was not in dispute that “each month each JV partner received 50% of the milk cheque.” She said the issue on the counterclaim was:
“whether the [plaintiff] Partnership was entitled to withhold 50% of the milk cheque for 1 November 2018, for the milk made by the cows overnight from 31 October 2018.” (Closing Submissions, paragraph 280)
593She said (Closing Submissions, paragraph 280):
“The [plaintiff] Partnership claimed entitlement to withhold that 50% because the [defendant] Company received 50% of the milk cheque on day 1 of the JV for milk that the cows had generated overnight of 31 October 2011.”
594She conceded that this was not a matter discussed or negotiated, but said it was:
“capable of being implied to give efficacy and is a fair term to give effect to the benefit the [defendant] Company had received. Alternatively, the [defendant] Company would also be unjustly enriched. The Partnership accepts that if those legal defences are not accepted by the Court, then the Defendants would succeed in their counterclaim in respect of the milk cheque.” (Closing Submissions, paragraph 282)
595Mr O’Haire (reply submissions, paragraph 75) noted that neither of those defences was pleaded by the plaintiffs. Further, as I have already observed, whilst the statement of claim in its prayers for relief seeks an accounting of joint venture expenses, it does not seek an accounting for joint venture income. In those circumstances, this counterclaim item succeeds.
Disposition
596I will direct the parties to bring in short minutes to give effect to these reasons.
Costs
597I have heard no submissions on the question of costs, and so I will reserve them.
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Certificate
I certify that these 144 pages are a true copy of the judgment of his Honour Judge Macnamara delivered on 15 April 2025.
Dated: 15 April 2025
Jodie Daniel
Associate to His Honour Judge Macnamara
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