Bulgin and Stockwell Pty Ltd v Reebok Australia Pty Ltd

[1999] NSWCA 470

CITATION:	Bulgin & Stockwell Pty Ltd v Reebok Australia Pty Ltd & Anor [1999] NSWCA 470
FILE NUMBER(S):	CA 40678/97
HEARING DATE(S):	29/07/99, 30/07/99
JUDGMENT DATE:	17 December 1999
PARTIES :	Bulgin & Stockwell Pty Ltd Reebok Australia Pty Ltd John Fletcher International
JUDGMENT OF:	Beazley JA at 1; Giles JA at 36; Hodgson CJinEq at 78

LOWER COURT JURISDICTION:	District Court
LOWER COURT FILE NUMBER(S) :	279/94
LOWER COURT JUDICIAL OFFICER:	Christie DCJ

COUNSEL:	Appellant: P M Jacobson QC/ K P Smark Respondent: P E King/ K Hawes Second Respondent: M A Elkaim
SOLICITORS:	Appellant: Bruce & Stewart Respondent: Withnell & Co Second Respondent: Henry Davis York
CATCHWORDS:	Contract; Breach of contract; Carriage and storage of goods; Theft of goods; Liability; Damages; Exclusion clause; Standard terms of contract; Third party liability
ACTS CITED:	Trade Practices Act 1975 (Cth)
CASES CITED:	University of Wollongong v Metwally (No2) (1985) 59 ALJR 481
DECISION:	Appeal dismissed with costs

THE SUPREME COURT

OF NEW SOUTH WALES

COURT OF APPEAL

CA 40678/97
DC 279/94

BEAZLEY JA
GILES JA
HODGSON CJ in Eq

Friday, 17 December 1999


BULGIN & STOCKWELL PTY LIMITED v REEBOK AUSTRALIA PTY LIMITED & ANOR





FACTS

The appellant (Bulgin & Stockwell) is a customs agent. The first respondent (Reebok) is a sporting goods and clothing retailer and the second respondent (John Fletcher International) is a warehouse owner and operator who provides bonded warehouse facilities to importers.

Reebok, in April 1990, imported a consignment of shoes (the goods) and retained Bulgin & Stockwell to obtain customs clearance of the goods and provide inland carriage to the second respondent’s bonded warehouse (the contract of carriage). Reebok had previously used the service of both. The first respondent collected the containers of goods and took them to the bonded warehouse. On container was unloaded but the second, containing the goods in question, was not unladed due to delays within the warehouse. The first respondent’s driver took the container to premises of the first respondent for storage over the weekend. The container was stolen from those premises during the course of the weekend.

Reebok alleged that the container was taken to those premises contrary to a specific instruction to store them at John Fletcher International’s bonded warehouse over the weekend. Bulgin & Stockwell denied the instruction had been given and further relied upon its standard conditions of contract which appeared on the back of an Acknowledgment, which it used in business, to avoid, exclude or limit its liability to Reebok for the loss occasioned by the theft.

Bulgin & Stockwell also brought third party proceedings against John Fletcher International claiming indemnity or contribution on the basis that they were engaged in conduct contrary to s 52 of the Trade Practices Act 1975 (Cth) TPA.

The trial judge found that the goods were stored at the first respondent’s premises against the strict instructions of Reebok and in doing so, referred to a concession made by the first respondent, that if that was the case it “would be liable for the theft that thereafter took place” . The trial judge did not determine whether the standard conditions of contract were incorporated into this contract. Nor did his Honour expressly deal with bases upon which Bulgin & Stockwell claimed indemnity or contribution against John Fletcher International. Bulgin & Stockwell sought a new trial for the purpose of having those issues determined.

HELD

Appeal against Reebok

per Beazley JA

(i) The appeal against Reebok should be dismissed.

(ii) There was no direct evidence that the Acknowledgment had been sent by Bulgin & Stockwell to Reebok, nor any evidence that Reebok received the Acknowledgment or accepted the standard conditions as conditions of the contract. In those circumstances, there was no evidence from which it could be concluded that the standard conditions became incorporated into the contract. Accordingly, a new trial should not be ordered, notwithstanding that the trial judge had failed to determine the question whether the standard conditions were incorporated into the contract.

per Giles JA (Beazley JA and Hodgson CJ in Eq agreeing)

(i) The concession made by Bulgin & Stockwell’s counsel, that if it was found that the instruction as to storage over the weekend had been given, it was liable for the theft, was unlimited in its terms and should be so read.

(ii) As the trial judge found the instruction had been given, Bulgin & Stockwell was liable to Reebok for the loss suffered due to the theft of the goods and it was not open to it to maintain its grounds of appeal.

Appeal against John Fletcher International

per Beazley JA (Giles JA and Hodgson CJ in Eq agreeing)

(i) The appeal against John Fletcher International should be dismissed.

(ii) Again, although the trial judge had not dealt with specific issues relied upon by Bulgin & Stockwell, the evidence was such that it could not prove either reliance or causation on the representations alleged to have been made. Accordingly, it was not appropriate to order a new trial.

ORDER

Appeal dismissed with costs.

THE SUPREME COURT

OF NEW SOUTH WALES

COURT OF APPEAL

CA 40678/97
DC 279/94

BEAZLEY JA
GILES JA
HODGSON CJ in Eq

Friday, 17 December 1999


BULGIN & STOCKWELL PTY LIMITED v REEBOK AUSTRALIA PTY LIMITED & ANOR

JUDGMENT

1    BEAZLEY JA: The appellant (Bulgin & Stockwell) is a customs agent and carrier. The first respondent (Reebok) is a well known retailer of sporting goods and clothing. The second respondent (John Fletcher International) is a warehouse owner and operator, and provides, inter alia, bonded warehouse facilities to importers.

2    In April 1990 Reebok imported a consignment of sporting and ladies shoes (the goods) stowed in container number OCLU - 903 - 5104 on the MV Nichigoh Maru. Reebok retained Bulgin & Stockwell to obtain customs clearance of the goods and to provide inland carriage to John Fletcher International’s bonded warehouse (the contract of carriage). Reebok had previously used the services of both Bulgin & Stockwell and John Fletcher International.

3    Bulgin & Stockwell collected container OCLU - 903 - 5104 containing the goods and another container from the MV Nichigoh Maru on Friday 4 May 1990. In accordance with the original instructions given to Bulgin & Stockwell, the containers were taken to John Fletcher International’s bonded warehouse at Rozelle. The first container was unloaded. Container OCLU - 903 - 5104 could not be unloaded that day because of delays within the warehouse. Bulgin & Stockwell’s driver took the container to Bulgin & Stockwell’s premises at Chester Hill in Sydney, from where it was stolen sometime over the weekend of 4 - 6 May 1990.

4    Reebok alleged that the container had been taken to Chester Hill contrary to an express instruction that they be taken to John Fletcher International’s Glebe depot for unloading onto a John Fletcher vehicle and returned to its Rozelle bonded warehouse for storage over the weekend. Bulgin & Stockwell denied that the instruction had ever been given, and also relied upon its standard conditions of contract which appeared on the back of an Acknowledgment, which it used in its business, to avoid, exclude or limit its liability to Reebok for the loss.

5 Bulgin & Stockwell also brought co-defendant proceedings against John Fletcher International claiming indemnity or contribution on the basis that John Fletcher International had engaged in conduct contrary to s 52 of the Trade Practices Act 1975 (Cth) (TPA) in representing that it could unload the goods on 4 May or alternatively breached its duty of care in failing to ensure that it could unload the goods in time or in failing to give it sufficient notice that it would not be in a position to unload the goods. However, as argued in this Court, only the contravention of s 51A was relied upon.

Trial Judge’s Findings

6    The trial judge found that the goods had been stored at Chester Hill in contravention of express instructions that they be stored at John Fletcher International. Having made that finding, the trial judge referred to a “concession” made by Bulgin & Stockwell that if that was the case it “would be liable for the theft that thereafter took place”. His Honour concluded:

“As I have found that the taking of the good (sic) from Fletchers to Reeboks to Chester Hill was an unauthorised act and in defiance of instructions given then [Bulgin & Stockwell] would not be entitled to rely upon the provisions of the standard trading conditions even if I found them to be part of the contract between the parties.”

7    As is apparent from this passage his Honour did not determine whether the standard conditions of contract were incorporated into this contract. Nor did the trial judge expressly determine Bulgin & Stockwell’s claim for indemnity or contribution against John Fletcher International.

8    His Honour’s failure to determine these two issues is the central complaint made on the appeal.

The Dealings Between the Parties

9    On 20 April 1990, Reebok wrote to Bulgin & Stockwell in the following terms:

“Please find enclosed shipping documents and container list. Please clear as indicated.
The containers must be dealt with as follows -
1. Containers OCLU 9035104 , OCLU 9029457, OCLU 9034469, OCLU 9034387 and OCLU 9034432 must be delivered to Fletchers and after unpacking, RAU’s 36505, 36231 and 36220 must be delivered to Reebok warehouse
2. Containers OCLU904690, OCLU 9034685 and OCLU 9029436 must be delivered to Reebok warehouse and after unpacking RAU 36497 must be uplifted and sent to Brambles bonded warehouse.”

10    Container OCLU 9035104 was the stolen container.

11    Shortly after receipt of Reebok’s instructions it generated the Acknowledgment. The Acknowledgment does not bear a date but records that “the job” was raised on 23 April 1990. Other documents reveal that the shipment was processed over the following week.

12    The Acknowledgment was a pro forma document in the following form:

“ BULGIN & STOCKWELL PTY LTD .
Client: Job No:
Aircraft/Vessel: Client Ref:
Supplier: Port of Discharge:
No of Packages & Goods: Date of Arrival:
Container:
ACKNOWLEDGEMENT
All business is transacted subject to our standard conditions as printed on the back hereof.

IMPORTANT REMINDER
Please note we still require the following:
_________________________________
_________________________________
_________________________________
Your early attention to this matter will be appreciated.
We thank you for placing this consignment in our care.
Yours faithfully
BULGIN & STOCKWELL PTY LTD
Per ……………………………………………………………”

13    It is apparent from its format and the evidence that it was a computer generated document, that the Acknowledgment served a number of purposes. First, it recorded specific information in relation to each contract: the name of the client, the job number and client reference; the vessel on which the goods were carried; the supplier, number of packages and goods; the port of discharge; the date of arrival; and the container references. In this case, the completed Acknowledgment stated that the shipment comprised eight containers of footwear. However, only five containers were specified. The subject container, OCLU-903-5104, was not listed. This discrepancy was explained in the evidence as being due to a space limitation on Bulgin & Stockwell’s computer. Reebok argued that the omission of this container reference on the Acknowledgment was sufficient of itself for the standard conditions not to apply in this case. I do not agree. If the terms of the Acknowledgment were otherwise imported into the contract of carriage, the documentation as a whole included the subject container.

14    Secondly, it was a means of notifying the client that additional information or documentation was required and requesting that it be provided. In this case it appears no additional information or documentation was being sought.

15    Thirdly, the Acknowledgment contained Bulgin & Stockwell standard conditions of contract. The “standard conditions” on the back of the Acknowledgment were, relevantly:

“4. Subject to express instructions in writing given by the customer, the Company reserves to itself complete freedom in respect of means, route and procedure to be followed in the handling and transportation of goods.
…
14. The Company shall not be liable for loss of or damage to goods unless such loss or damage occurs whilst the goods are in the actual custody of the Company and under its actual control and unless such loss or damage is due to the wilful neglect or default of the Company or its own servants.
…
16. It is hereby agreed by and between the Customer and the Company that any liability of the Company on whatsoever ground arising shall in every case be limited in amount to the sum of $20 in respect of all the goods listed on this Acknowledgment whether or not there has been any declaration of value of the goods or any of them by the Customer or Consignor for the purposes of carriage or otherwise.
…
20. Pending forwarding and delivery, goods may be warehoused or otherwise held at any place or places at the sole discretion of the Company at the Customer’s risk and expense.
26(a). In the absence of special instructions, it shall be in the entire discretion of the Company to decide at what time to perform any or all of the various acts …”

16    The Acknowledgment was signed by Mr Joyce, Bulgin & Stockwell’s then New South Wales Operations Manager. He said he had signed the top copy, which was the client copy, and retained the carbonised copy for Bulgin & Stockwell’s records. The Acknowledgment in evidence was a carbonised copy retained by Bulgin & Stockwell. There was no evidence of the whereabouts of the original.

17    Mr Joyce gave evidence of the practice in relation to forwarding the Acknowledgment to Reebok. He said that:

“… the original of that acknowledgment would be taken out and given to the registration clerk to put in the Reebok tray for delivery back to Reebok by our daily courier.
…
… we picked up and delivered documents at least once a day, more often twice or three times a day.”

18    He summarised the practice as being:

“The original client copy of [the Acknowledgment] would have been placed in the Reebok tray where it would have been collated with any other Reebok documents that we had to go to Reebok, would have been placed in an envelope and delivered by one of our staff either the chap that did the air freight or the chap that did the sea freight run and they would deliver those documents to Reebok and pick up any documents that were waiting at Reebok for us.”

19    However, Bulgin & Stockwell did not rely on a course of dealing to incorporate the standard conditions on the back of the Acknowledgment into the subject contract of carriage. There was no direct evidence that the practice of which Mr Joyce gave evidence had been followed on this occasion. Nor was there any evidence of Reebok’s receipt of the Acknowledgment. The Acknowledgment was addressed to Reebok’s Post Office number at Double Bay. It was marked to the attention of Mr Hendler. Mr Hendler was Reebok’s General Manager. He gave evidence in which he appears to concede that in the twelve months prior to this contract, Bulgin & Stockwell did send out a document called an Acknowledgment. That evidence was:

“Q. Mr Hendler, in relation to container, may I just call it 5104 because it makes the number slightly easier, which is the subject of this claim, [the letter of 20 April] that you have before you is the letter that emanates from Reebok Australia to Bulgin and Stockwell which contains the advice to them in relation to the containers to which they are to provide the two kinds of services that we’ve just discussed, is that correct?
A. Right.
Q. And after that document goes out is it the case that what is sent back from Bulgin and Stockwell is a document called - and if I show it to you it might help you - is a document called, acknowledgment.
A. Right.
…
Q. Yes. And the same pattern - the two kinds of documents, the one emanating from Reebok Australia and the one emanating from Bulgin and Stockwell Pty Limited were exchanged throughout the course of the previous twelve months prior to 4 May 1990?
A. Yes.”

20    However, he was not personally familiar with such a document. He said:

“Q. And is that a document with which you personally are familiar or are other officers in your company the ones who deal with that?
A. I am not familiar with it but obviously the people who dealt with it were presumably familiar with it.”

21    Mr Hendler was not asked directly whether he had seen the Acknowledgment in respect of this contract although it must be inferred from his evidence that he had not. He also said that the day to day responsibility for the movement of containers was left to others in Reebok and that the person principally responsible was Mr Utian.

22    Mr Utian was the Administration Manager in the Shipping Department, and his responsibilities included initiating orders and giving instructions to ensure that goods were delivered into bonded warehouses and “being responsible for getting the goods into [Reebok’s] warehouse”. Mr Utian said that in the course of performing his duties, he saw shipping documents, such as bills of lading, but that he could not recall having ever seen a document called an Acknowledgment. He said that his responsibility didn’t include receipt and acceptance of the terms and conditions of the contract of carriage. He said all shipping documents were stored in Reebok’s costing department. He specifically denied having seen the Acknowledgment relating to this contract of carriage. He denied that he was aware of anyone in Reebok having even seen that document. Mr Utian said that he would speak directly to Mr Joyce by telephone to ensure that Bulgin & Stockwell had received instructions in relation to a particular shipment and reiterated that he had never received back any document called an Acknowledgment or ever seen one at Reebok. He said that his responsibilities did not include the receipt and acceptance of the terms and conditions of any particular contract of carriage. In cross-examination, he said that in his opinion such a document was never sent.

23    In re-examination the following evidence was given:

“Q. In response to a question that you were asked by Mr Wheelhouse regarding some evidence of Mr Hendler at pages 28 and 29 of the transcript, referring to acknowledgments or an acknowledgment, you said if such - with respect to the document and you were shown copies of that document, do you recall that?
A. Right.
Q. In bundles?
A. Yes.
Q. And you said words to the effect, that if this had been sent, it should have come to my attention, do you recall saying that?
A. Yes.
Q. Why did you say that if such a document had been sent it should have come to my attention?
A. Well I was the go between Bulgin and Stockwell and Reebok although I was under Archie Hendler and whenever there was any problems or queries, Bulgin and Stockwell would phone me or I would phone them so any papers or acknowledgments or things should have been between them and me because of the way that the whole shipping system worked there.”

24    A review of the transcript shows that the introductory question “you said words to the effect, that if this had been sent, it should have come to my attention” is not quite accurate. Mr Utian had said that in his position as Administration Manager he saw the “mercantile documents” relating to importation and clearing of the goods and that he would check by telephone whether Bulgin & Stockwell had received his written instructions. Notwithstanding the inaccurate questioning, his answer on re-examination emphasises that he had not seen such a document.

25    Mr Utian identified Mr Neill, the Warehouse Manager as being the person solely responsible for receiving the paperwork relating to the delivery of goods to Reebok’s warehouse. His responsibilities were to run the day to day affairs of the warehouse. Mr Neill said he did not receive the Acknowledgment alleged to have been sent in this case nor had he ever seen such a document.

26    No other person was identified in the evidence as being the person likely to receive or having responsibility for keeping or recording the Acknowledgment.

27    As Bulgin & Stockwell did not rely on a course of dealing to incorporate the standard conditions into the contract, the question which it contended should have been determined, and clearly was not, was whether, in respect of this contract, the standard conditions applied. They would only have been incorporated into this contract if the Acknowledgment had been received by Reebok by someone with the authority to accept and/or agree to the terms of the contract.

28    The question of whether the Acknowledgment was received involves a finding of fact, which, in the usual course, should be determined at first instance. Also, in the usual course, if a trial judge fails to determine an issue which requires determination for the proper disposal of the litigation, there needs to be a new trial. Bulgin & Stockwell submitted that in this case the need for a new trial was underscored by the fact that the evidence in relation to non-receipt of the Acknowledgment was the oral evidence of witnesses, particularly Mr Utian’s, whose credit was strenuously attacked at trial. Although Mr Utian’s evidence as to the question whether the ‘instruction’ had been given to Reebok was accepted, the trial judge stated in relation to the Acknowledgment that “Mr Utian’s evidence that he had never seen an Acknowledgment ... [is] ..evidence which I find difficult to accept”. His Honour of course made no actual finding on the issue.

29    Although his Honour was sceptical as to Mr Utian’s evidence in respect of the Acknowledgment, the difficulty with raising this as the reason why there should be a new trial is that Bulgin & Stockwell did not prove that Mr Utian was the natural recipient of such a document. Nor did it prove who within Reebok would have received and dealt with the document. On the face of it, it was directed to Mr Hendler. He said that he had never seen such a document.

30    In my opinion, before it could be said to be appropriate to order a new trial in this case so that the question of whether the standard conditions had been incorporated into the contract, it would be necessary for Bulgin & Stockwell to demonstrate that there was some evidence from which it could be inferred that the document was received and its terms accepted. Although there was some evidence to support a finding that the Acknowledgment was sent, the only matter to which Bulgin & Stockwell can point in relation to acceptance of the standard conditions is the expression by his Honour of some scepticism of Mr Utian’s evidence in this regard. The question is whether that is sufficient. In my opinion it is not. Whilst a trial judge may accept a witness’s evidence in part and reject it in part, the fact that a witness’s denial is not accepted by a trial judge does not, of itself, prove the converse. Thus, the trial judge was left at the end of the trial with no evidence from which he could infer that the Acknowledgment had been received and its terms accepted.

31    Senior Counsel for Bulgin & Stockwell recognised that if the first part of his argument failed, the question of the proper construction of the exclusion and limitation clauses of the Acknowledgment did not arise and the appeal should be dismissed. The view to which I have come on this point makes it unnecessary to decide whether Bulgin & Stockwell was precluded in any event from contending the standard conditions applied because of its concession that if the trial judge found against it on the instruction it was liable. However, since preparing these reasons I have had the opportunity of reading in draft the judgment of Giles JA. I agree with his reasons and for that reason also would dismiss the appeal.

Contribution and Indemnity Claim Against John Fletcher International

32 Bulgin & Stockwell submitted that if it was liable to Reebok it was entitled to contribution or indemnity from John Fletcher International because, in contravention of s 52 of the TPA, John Fletcher International had represented that it was able to unload the goods on 4 May. It was submitted that John Fletcher International had failed to prove that it had a reasonable basis for making the representation as required by s 51A of the TPA; that Bulgin & Stockwell had relied upon it and taken the goods to John Fletcher International on 4 May 1994 for unloading; and that John Fletcher International’s failure to unload the goods on 4 May was the cause of the loss of the goods. Consequently, John Fletcher International was liable to Bulgin & Stockwell in an amount equivalent to the amount for which Bulgin & Stockwell was liable to Reebok.

33    In my opinion, this matter can be disposed of briefly. Mr Broughton was Bulgin & Stockwell’s witness on this issue. He said Mr McRae from John Fletcher International told him on 3 May he could accept the containers on 4 May. He said if he had been told the containers would not be unloaded on 4 May “we would have agreed on another date perhaps” and not uplifted the containers from the bond store. However, he said that there had been previous occasions when a container could not be unloaded on the day arranged and that when he made the arrangements with Mr McRae on 3 May he knew that it was a possibility that the containers would not be unloaded on 4 May. John Fletcher International submitted, correctly in my opinion, that Bulgin & Stockwell had therefore failed to prove reliance on John Fletcher International’s representation.

34    That is sufficient to dispose of this point. However, it should also be pointed out that Mr Broughton also said that had an instruction been given that the containers be taken to Glebe to be loaded onto a John Fletcher International truck for return to Rozelle and storage over the weekend, he would have directed the driver to follow the instruction. Bulgin & Stockwell’s case was that no such instruction had been given. Its case on that point was rejected. Accordingly, Bulgin & Stockwell also failed to prove that the loss of the goods was causally related to John Fletcher International’s alleged representation.

35    It follows that the appeal against John Fletcher International also fails.

36    GILES JA: Reebok Australia Pty Ltd (“Reebok”) imported some sporting and ladies shoes. The shoes were in a container on the MV Nichigoh Maru arriving in the Port of Sydney on 14 April 1990, one of eight containers consigned to Reebok.

37    On 20 April 1990 Reebok instructed Bulgin & Stockwell Pty Ltd (“Bulgin”), its customs agent, to obtain clearance of the whole consignment. The letter read -

“Please find enclosed shipping documents and container list. Please clear as indicated.
The containers must be dealt with as follows -
(i) Containers OCLU 9035104, OCLU 9029457, OCLU 9034469, OCLU 90344387 and OCLU 9034432 must be delivered to Fletchers and after unpacking, RAU’s 36505, 36231 and 36220 must be delivered to Reebok warehouse.
(ii) Containers OCLU 904690, OCLU 9034685 and OCLU 9029436 must be delivered to Reebok warehouse and after unpacking RAU 36497 must be uplifted and sent to Brambles bonded warehouse.”

38    The shoes were in container OCLU 9035104 (“the container”). “Fletchers” was John Fletcher International, the trading name of Remath Investments No 6 Pty Ltd (“Fletcher”). It was a warehouseman, amongst other things providing bonded warehouse facilities.

39    A form of acknowledgment of Reebok’s instruction (“the Acknowledgment”) was raised within Bulgin on 23 April 1990. It contained the statement, “All business is transacted subject to our standard conditions as printed on the back hereof”. The standard conditions included -

“4. Subject to express instructions in writing given by the customer, the Company reserves to itself complete freedom in respect of means, route and procedure to be followed in the handling and transportation of goods.”
“14. The Company shall not be liable for loss of or damage to goods unless such loss or damage occurs whilst the goods are in the actual custody of the Company and under its actual control and unless such loss or damage is due to the wilful neglect or default of the Company or its own servants.”
“16. It is hereby agreed by and between the Customer and the Company that any liability of the Company on whatsoever ground arising shall in every case be limited in amount to the sum of $20 in respect of all the goods listed on this Acknowledgment whether or not there has been any declaration of value of the goods or any of them by the Customer or Consignor for the purposes of carriage or otherwise.”
“20. Pending forwarding and delivery, goods may be warehoused or otherwise held at any place or places at the sole discretion of the Company at the Customer’s risk and expense.”
“26. (a) In the absence of special instructions, it shall be in the entire discretion of the Company to decide at what time to perform any or all of the various acts which may be necessary for the completion of the services in relation to any particular matter …”.

40    Whether a copy of the Acknowledgment was sent to Reebok was in issue at the trial.

41    Bulgin took delivery of the container from the wharf on 3 May 1990, keeping it overnight at its premises at Chester Hill. On 4 May 1990, a Friday, its driver Mr Kevin Crocker drove a truck loaded with the container and another container to Fletcher’s premises at Rozelle, it seems a bonded warehouse and either from previous dealings or from particular communication known to be the place to which the containers were to be delivered in accordance with the letter of 20 April 1990. The other container was unloaded from the Bulgin’s truck at Rozelle, but early in the afternoon Mr Crocker was told by Mr Des McRae, Fletcher’s manager at the premises, that the container could not be unloaded that day.

42    According to Mr McRae, but denied by Mr Crocker, Mr McRae told Mr Crocker to take the container to other premises of Fletcher at Glebe, so that it could be transferred to a smaller Fletcher truck which would bring it back to the Rozelle premises for safe keeping in bond conditions over the weekend. There was further dispute in the evidence as to other communications between Reebok, Bulgin and Fletcher over what to do with the container. I will come back to these matters.

43    In the result, Mr Crocker took the container to Bulgin’s premises at Chester Hill. The truck carrying the container, and by then another container loaded at Reebok’s premises during the afternoon, was locked in Bulgin’s yard. At some time over the weekend of 5 and 6 May 1990 an unknown person obtained entry to the yard and made off with the truck and the containers.

44    The contest concerning the movement of the container from Rozelle to Chester Hill was described by the trial judge as “a serious, indeed crucial, factual dispute”.

45    As I have indicated, Mr Croker denied that he was told to take the container to Fletcher’s premises at Glebe from where it would be brought back to Fletcher’s premises at Rozelle on a Fletcher truck. According to Mr Crocker, he was told to bring the container back to Fletcher’s premises at Rozelle on the following Monday, and nothing was said about transferring the container to a Fletcher truck at Glebe and bringing it back to the Rozelle premises on the Friday. Bulgin’s case, through the evidence of Mr Crocker and Bulgin’s transport Manager Mr Tony Broughton, was that Crocker told Mr Broughton that he had been “turned away” by Fletcher, and that Mr Broughton told him to go to Reebok’s premises to collect some papers for another job, while there to take on another container which would block access to the Reebok container so as to give it security and then to leave his truck at the Chester Hill premises over the weekend. This was done. On Bulgin’s case, when it was unable to deliver the container to Fletcher Bulgin took all reasonable steps to keep it safe over the weekend (and the trial judge found that “the security measures taken by the defendant were adequate to properly protect the goods from the type of criminal enterprise to which they were subject”).

46    Reebok’s case, through the evidence of Mr McRae, and Messrs Des Ward, Michael Utian, and Peter Neill, added to this not only Mr McRae’s telling Mr Crocker to take the container to Fletcher’s premises at Glebe etc, but also explicit instructions from Reebok to the same effect. Mr Ward was Fletcher’s general manager. Mr Utian was the administration manager in Reebok’s shipping division. Mr Neill was Reebok’s warehouse manager. On their case, Mr Crocker’s arrival at Reebok’s premises with an unexpected container provoked a three way telephone conversation between Mr McRae, Mr Utian and Mr Ward in which it was agreed that Mr Utian would tell the driver to go to Glebe to have the container put on a Fletcher truck and taken to Fletcher’s premises at Rozelle for safe keeping over the weekend, and, through Mr Neill, Mr Crocker was instructed accordingly.

47    According to Mr Broughton, he received a telephone call from Mr Utian wanting to know what Mr Crocker was doing at Reebok’s premises, and he “explained the situation” to Mr Utian, including that Bulgin was taking the container back to its premises. But Mr Utian denied this conversation, and said that he did not even know of Mr Broughton.

48    The trial judge preferred the evidence of Messrs McRae, Ward and Utian to that of Messrs Crocker and Broughton. His reasons for doing so need not be explored, because his findings of primary fact were not challenged. Hence he found that there was “a specific departure from the instructions that emanated from Mr McRae to Mr Crocker and thereafter from Mr Utian to Mr Crocker via Mr Neill”, and rejected Mr Broughton’s evidence as to the telephone call from Mr Utian.

49    Having so found, his Honour said -

“It is conceded by the defendant, and in any event it would be so, that if the presence of the plaintiff’s container at the defendant’s premises over the weekend was in contravention of the wishes of the plaintiff expressly made known to the defendant, then the defendant would be liable for the theft that thereafter took place.
…
I do not find it necessary to decide whether the ‘standard trading conditions’ allegedly contained on the back of the ‘acknowledgment’ formed part of the contract or not. As I have found that the taking of the good [sic] from Fletchers to Reeboks to Chester Hill was an unauthorised act and in defiance of instructions given then the defendant would not be entitled to rely upon the provisions of the standard trading conditions even if I found them to be part of the contract between the parties.
…
I find that the defendant breached its agreement with the plaintiff in acting in the manner in which it did on the afternoon of Friday 4th May and is consequently liable to the plaintiff in respect of the loss suffered.”

50    The grounds for Bulgin’s appeal against Reebok were, in short, that the standard conditions were part of the contract between it and Reebok, and that the conditions earlier set out meant either that it was not in breach of its contract with Reebok because it was entitled to do what it did with the container, or that it was protected by an exclusion of liability, or that its liability was limited to $20.

51    Reebok’s first response was that Bulgin was precluded by its concession made at the trial from relying on these conditions. In my opinion that is correct, and it is unnecessary to consider whether the standard conditions became part of the contract between Bulgin and Reebok or whether and how they operated to protect Bulgin.

52    Counsel for Bulgin properly stated that he was not in a position to put to the Court that the concession was not made in the terms recorded in the reasons of the trial judge. He submitted nonetheless that the concession had to be read as subject to the effect of the standard conditions. That it was subject to the effect of the standard conditions, it was submitted, was apparent from the following statement in the reasons to the effect that, in the circumstances as found, Bulgin “would not be entitled to rely upon the provisions of the standard trading conditions even if I found them to be part of the contract between the parties”. It was said that it would not have been necessary to say anything about the standard conditions if the concession had been without qualification.

53    Reebok’s submission was to the effect that the concession, in the terms recorded in the reasons of the trial judge, was on its face unqualified, and that an appreciation of the course of the trial explained the following statement and made it clear that the concession was without qualification.

54    The materials before us did not include a transcript of the oral submissions made to the trial judge, or other evidence of the making of the concession. We were provided with copies of the written submissions provided to the trial judge. It is necessary to evaluate the concession from the recording of it in the reasons of the trial judge, read as part of the reasons as a whole, and from the circumstances of the trial in which the concession was made. It must be remembered that a trial is dynamic, that a concession may be made in submissions as a result of modification of the opponent’s case or dialogue with the trial judge, and that a concession of its nature may involve departure from a stance earlier maintained or at the least clarification of that stance.

55    In its amended statement of claim Reebok relevantly alleged -

“3. The Defendant was contracted to the Plaintiff to provide services by way of customs clearance of the goods and inland carriage of the goods to a bonded warehouse, in this case owned or operated by John Fletcher International.

4. Instead of delivering the goods from storage to John Fletcher International the Defendant stored the goods at its own premises on the weekend of 4 to 6 May 1990 from which premises, with the complicity of an unidentified employee of the Defendant, the goods were stolen whereby the Plaintiff has suffered loss and damage.

5. There was an express undertaking which was a fundamental term of the contract that the Defendant would not store the goods on its premises which undertaking the Defendant breached whereby it deviated from the contract or alternatively committed an unauthorised breach of contract or alternatively committed a breach of a fundamental term or a collateral warranty thereto.
…
6. In the premises the Plaintiff is entitled to recover the whole of its loss from the Defendant by reason of the breach of contract of the Defendant, or alternatively breach of bailment, or alternatively negligence.
Particulars of Negligence

(a) Failing to ensure that the goods were kept in storage within bonded premises when not in transit.

(b) Failing to provide any, or any adequate, security for the goods.”

56    Bulgin’s defence admitted para 3, as to para 4 admitted that the goods were on Bulgin’s premises during the period 4-6 May 1990 and that they were stolen on 6 May 1990 but otherwise denied the paragraph, and denied paras 5 and 6. Expressed to be in answer to the whole of the statement of claim, paras 9 and 10 of the defence then alleged that Bulgin agreed to provide to Reebok the services provided in para 3 of the statement of claim on the standard conditions in the Acknowledgment, and specified the substance of the conditions set out earlier in these reasons.

57    In its reply Reebok denied paras 9 and 10 in Bulgin’s defence, and said as well -

“3. In further answer to paragraphs 9 and 10 of the Notice of Grounds of Defence of the First Defendant, the Plaintiff says that the representations pleaded in paragraph 7 of the Statement of Claim override any exemption or limitation referred to.
4. In further answer to paragraphs 9 and 10 of the Notice of Grounds of Defence of the First Defendant, the Plaintiff says that the Defendant committed an authorised [sic: unauthorised] breach of contract or deviated from the same whereby the First Defendant is unable to rely upon the alleged terms and conditions which have no application to the loss and damage claimed.
Particulars
(a) Instead of delivering the goods from the wharf after clearance to the premises of the Second Defendant, the First Defendant stored the goods at its own premises on the weekend of 4 to 6 May 1990.
(b) With the complicity of an unidentified employee of the First Defendant, the goods were stolen on the weekend of 4 to 6 May 1990.”

58    The pleadings raised reliance by Bulgin on the standard conditions and, it seems in anticipation as well as in reply, whether by what for present purposes can be described as deviation from the contract Bulgin lost the protection of those conditions. It is fortunately not necessary to comment on the manner in which the pleadings were expressed. It is of significance that they did not identifiably take up an explicit instruction given on the afternoon of 4 May 1990. The fault alleged lay in failure to deliver to Fletcher as instructed in the letter of 20 April 1990 and generalised failure to keep the container securely.

59    The transcript before us included a brief opening by Reebok’s counsel, relevantly uninformative, and a response by Bulgin’s counsel to the trial judge’s invitation to provide “a very quick summary of what you see as being involved in this case”.

60    The response included (as transcribed) -

“WHEELHOUSE: Your Honour first of all our submission is that there’s no such thing as a fundamental term, there are terms and conditions, the former of which enables a rescission, the latter of which enables claims for damages so we are treating this as my learned friend had opened as a breach of contract case so the first issue we see in the case is a determination of what the contractual arrangement between the parties is. We the contractual arrangements your Honour being comprised of the exchange of correspondence in relation to this particular container.”

61    The first mention of the content of the contractual arrangements, after a copy of the Acknowledgment has been provided to the trial judge, was then -

“WHEELHOUSE: So we say that the contract does not specify that there has to be an exclusive direct delivery of the container to the bond store. Because we have to pick up the container from the wharf and we have to deal with the problems on the wharf and we have to deal with the fact that the bond store shuts at 3 o’clock. If there’s a strike or for any number of reasons the boxes on the back of the truck we have to be able to deal with it and our conditions provide that. There is no express written variation to the contract as is required saying, don’t take it to the depot. There’ll be some contentious material about that as your Honour will hear in due course.”

62    An outline of events on 4 May 1990, and the subsequent theft of the shoes, was given, and the nature of the “contentious material” was then identified -

“WHEELHOUSE: What my learned friend - and each of us have some idea of what’s going on because there are reports prepared by assessors from time to time, so your Honour what my learned friend’s position as we understand it is that there was a specific instruction given to our driver to go to another premises at Glebe and to have the containers unloaded and put onto another truck and then brought back to the Rozelle bond store and the whole lot would have been placed in the Rozelle bond store over the weekend.
The defendant’s case is that no such instructions were given and that’s an issue for your Honour to decide in due course.
HIS HONOUR: You say he had to go to the wharf to get another container. They say you were sent to --
KING: Glebe.
WHIEELHOUSE: To Glebe.
HIS HONOUR: To do what, was it to dump it at their premises where it’s secure.
WHEELHOUSE: To take it off our - to have it removed from our truck, placed on one of their trucks and then put back in the bond store over the weekend.
HIS HONOUR: But at the Glebe premises not where the unpacking was to take place.
WHEELHOUSE: No at the - as we understand it, at the warehouse where the unpacking was to take place. There were two - there’s premises at Rozelle and the premises at Glebe and I’m probably muddling this up, my learned friend will probably correct me, but one - the packing premises is A, the non packing premises are at B. We are told to go - 2.30 in the afternoon on Friday, we are told to go to B so that the containers can be turned around and we understand the assertion to be to have the containers actually physically taken off our trailer and put on my learned friend’s client’s trailer and then take it back to the unpacking warehouse number A and left there over the weekend. Our clients dispute that and there will be some evidence about all that your Honour. So the issue –“

63    Counsel did not complete the statement of the issue. There was a brief interruption, and he concluded by referring to the defence and relevantly saying that “there’s a general denial of all the claims of bailment and negligence and then there is pleaded the specific terms in the contract … ”.

64    An explicit instruction was now part of the trial. There was a dispute over whether it had been given. The openings did not make clear how the explicit instruction, if found to have been given, was seen as affecting Bulgin’s liability to Reebok.

65    Reebok’s written submissions began with a “narrative of facts”. The narrative included facts material to whether the Acknowledgment was sent by Bulgin to Reebok, but was particularly concerned with what occurred on the afternoon of 4 May 1990. The written submissions then identified “questions”. The second question was whether Bulgin failed, in breach of its contract with Reebok, to deliver the container to Fletcher, and the third question was -

“3. If the answer to 2 is Yes, was the defendant excused from its breach of contract by reason of the terms of its acknowledgment form?
This question has three aspects:
(A) Was the acknowledgment form part of the contract in the circumstances of the present case?
(B) Has the defendant brought itself within the terms of clauses 14 and 16 of the acknowledgment form as pleaded in its defence?
(C) Assuming it was part of the contract, did the defendant commit an unauthorised breach of the contract as pleaded in the reply, such that its exceptions and limitations have no application to the events the subject of the proceedings?”

66    The written submissions then contended that breach of contract should be found because Bulgin “failed to deliver the goods to the destination as directed and accordingly was in breach of contract, unless excused”. The direction on which the submission was founded was the direction in the letter of 20 April 1990, not a direction conveyed from Mr Utian to Mr Crocker on 4 May 1990. The written submisions went on to contend that Bulgin was not “excused from breach of contract”, first because the Acknowledgment did not form part of the contract between the parties, secondly because cll 14 and 16 did not apply in the circumstances revealed in the evidence, and thirdly because of “unauthorised breach of contract or deviation”. Only cll 14 and 16 were addressed. The third ground was explained -

“Having regard to the express instructions given to the Defendant to deliver the goods from the wharf to the bond store, contained in the letter of 20 April 1990, taking the goods to Chester Hill on 3 May and again on 4 May fell outside any authority the defendant had to deal with the goods and so, assuming the acknowledgment form comprised part of the contract, denies any effect to any exception clause on the ground that such clauses do not apply upon their proper interpretation in the circumstances to the loss during such unauthorised carriage.”

67    It will be noted that Reebok’s written submissions did not focus on an explicit instruction on 4 May 1990. They rested upon the letter of 20 April 1990, and although the narrative of facts included that there had been a “clear arrangement Mr Utian had reached … with Mr Ward … that the container must go to Rozelle, there to be locked up”, and an “instruction Mr Utian had given to Mr Neill to give to the driver to go to Glebe”, nothing at all was said of this when dealing with the questions. It will also be noted that cll 14 and 16 were lumped together, including as conditions not available to Bulgin because of deviation from the contract, notwithstanding their different terms and the difference between exclusion of liability and limitation of liability.

68    Bulgin’s written submissions also began with the facts, but there is some significance in the factual areas they addressed. The first was “formation of the contract”, directed to the sending of a copy of the Acknowledgment to Reebok. The second was security at Bulgin’s Chester Hill premises, directed to the adequacy of security. The third was the circumstances under which the container was “turned away”, directed to acceptance of the evidence of Messrs Crocker and Broughton and rejection of any instruction (whether from Mr McRae or Mr Utian via Mr Neil) to take the container to Fletcher’s Glebe premises.

69    There was then reliance on the clauses in the Acknowledgment, including the submission that there is no doctrine of fundamental breach. All the clauses earlier set out, and some others, were listed by number, but without any real attention to the different ways in which they could operate and in particular without attention to the difference between exclusion of liability and limitation of liability.

70    The reliance, however, did not clearly address a finding, contrary to the earlier part of the written submissions, that Bulgin had been explicitly directed to take the container to Fletcher’s Glebe premises, for transfer to another truck and storage at Fletcher’s Rozelle premises over the weekend. Bulgin contended that, when turned away by Fletcher, it was entitled to keep the container at its Chester Hill premises for delivery to Fletcher’s Rozelle premises on the following Monday (in accordance with the evidence of Messrs Crocker and Broughton); that it provided adequate security at its Chester Hill premises; and that even if it did not provide adequate security it was protected by the standard conditions. Bulgin’s written submissions are consistent with a concession that if (contrary to Bulgin’s case) there was an explicit instruction on the afternoon of 4 May 1990 to take the container to Feltcher’s Glebe premises for transfer to a Fletcher truck and storage at Fletcher’s Rozelle premises over the weekend, then none of the standard conditions would avail Bulgin.

71    In the course of oral submissions the focus seems to have turned to liability as a result of the explicit instruction given on the afternoon of 4 May 1990, because that is what the trial judge regarded as crucial and was the subject of his finding of departure from instructions. The broad structure of the trial judge’s reasons was that, having identified what he described as a crucial factual dispute, the trial judge resolved that dispute in favour of Reebok’s case and,

72    The concession seems to have been made following such a change in focus. When Reebok came to contend that Bulgin was liable not because it failed to deliver the container to Fletcher as instructed by the letter of 20 April 1990, a failure for which there was an arguably sound answer in Fletcher’s refusal to take the container and reasonable steps thereafter to keep it securely, but because it failed to obey an explicit instruction given when it was known that there could not be the delivery to Fletcher originally contemplated, a new legal picture was presented. Bulgin’s reliance on the standard conditions to defeat, or even reduce, the liability as originally asserted was much more doubtful when the liability asserted was for breach of the explicit instruction. In the absence of evidence, of course, we do not know, but it is understandable that Bulgin’s counsel might have conceded that the standard conditions - even the limitation of liability clause - did not provide protection if there were a finding against Bulgin on the crucial factual issue as to the explicit instruction.

73    Given that the standard conditions were relied on by Bulgin in its defence and in its written submissions, it would be remarkable if the trial judge failed to address in appropriate detail extant questions of whether they formed part of the contract between Reebok and Bulgin and whether they protected Bulgin. In a few words, he said that Bulgin would not be entitled to rely on their protection even if they were part of the contract. Contrary to Bulgin’s submission before us, I do not think that the reference to the standard conditions indicated that the concession was subject to continued reliance on them. At the heart of the concession was the finding, against Bulgin’s case, of the explicit instruction on the afternoon of 4 May 1990. That was taken up in the reference to “defiance of instructions given” in the following statement. The reference to the standard condition is readily explicable as a reflection of the concession itself, part of the trial judge recording for the sake of completeness why it was not necessary to decide whether the standard conditions formed part of the contract between Reebok and Bulgin.

74    I have spent some little time on the course of the trial in an endeavour to place the concession in context. Having done so, I do not see why the terms in which the trial judge recorded the concession, that Bulgin “would be liable for the theft that thereafter took place”, should not be given their natural meaning. Liability is liability. Liability is not breach of contract but with the protection of an exemption clause. Still less can it be said that a party is liable when it remains to be decided whether, because of a term of the contract, that party was in breach of contract. At best, it could be said that Bulgin was liable but its liability was limited, but there was nothing to suggest that the parties regarded the limitation of liability clause differently from the other clauses. In context, liability meant liability for Reebok’s claim.

75    I do not think it was disputed that, if the concession be viewed in this way, it was not open to Bulgin to maintain the grounds for its appeal. Certainly no argument to that effect was put, and no reason appears to relieve Bulgin from the concession. I do not suggest by this that the concession was wrongly made: it may well have been entirely appropriate, but that is not a matter requiring further consideration. It is sufficient to refer to the statement of the High Court (Gibbs CJ, Mason, Wilson, Brennan, Deane and Dawson JJ) in University of Wollongong v Metwally (No 2) (1985) 59 ALJR 481 at 483 -

“It is elementary that a party is bound by the conduct of his case. Except in the most exceptional circumstances, it would be contrary to all principle to allow a party, after a case had been decided against him, to raise a new argument which, whether deliberately or by inadvertence, he failed to put during the hearing when he had the opportunity to do so.”

76    As to Bulgin’s appeal against Fletcher, I agree with Beazley JA and have nothing to add.

77    I propose that the appeal be dismissed with costs.

78    HODGSON CJ in Eq: I agree with Beazley JA and Giles JA.