Burando-Hill Pty Ltd v Smith - [2012] WADC 134

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION: PERTH

CITATION: BURANDO-HILL PTY LTD -v- SMITH [2012] WADC 134

CORAM: EATON DCJ

HEARD: 6-9, 12-16 DECEMBER 2011 & 19-23 MARCH 2012

DELIVERED : 6 SEPTEMBER 2012

FILE NO/S: CIV 2444 of 2010

BETWEEN: BURANDO-HILL PTY LTD
Plaintiff
AND
GRAEME DOUGLAS SMITH
ELENA SMITH
Defendants

Catchwords:

Contract - Implied terms - Collateral warranties

Trade practices - Misleading and deceptive conduct - Fitness for purpose - Merchantable quality

No provisional assessment of damages

Legislation:

Trade Practices Act 1974 (Cth)
Sale of Goods Act 1895 (WA)

Result:

Judgment for the plaintiff in the sum of $30,244.27
Defendants' counterclaim dismissed

Representation:

Counsel:

Plaintiff: Mr P A Kyle
Defendants: Mr P Mendelow

Solicitors:

Plaintiff: Haynes Robinson
Defendants: Blatchfords Lawyers

Case(s) referred to in judgment(s):

George Wills & Co Ltd v Davids Pty Ltd (1957) 98 CLR 77
Jillawarra Grazing Co v John Shearer Ltd (1984) ATPR 40-441
March v E & MH Stramare (1991) 171 CLR 506
McGrath, Re; Pan Pharmaceuticals Ltd (in liq) v Australian Naturalcare Products Pty Ltd [2008] FCAFC 2; (2008) 165 FCR 230
North East Equity Pty Ltd v Proud Nominees Pty Ltd [2012] FCAFC 1
Readymix Holdings International Pty Ltd v Wieland Process Equipment Pty Ltd (No 2) [2008] FCA 1480
Refinery (Westernport) Pty Ltd v Hastings Shire Council (1977) 180 CLR 266
Watson v Foxman (2000) 49 NSWLR 315

Contents

The Pleadings
The Statute Law
The X20 system
The evidence as to the formation of the contract
Findings of fact
The alleged representations as pleaded
Were those alleged representations contractual warranties?
The representation as to liquid fertiliser
The evidence as to the delivery of the X20 system
When did seeding commence?
The defendants' preparation for the commencement of seeding
The course of seeding
Events following the completion of seeding
Other expert evidence as to the defendants' seeding equipment
The optimum time for seeding
The harvest
Reflections on the evidence generally
Damage to the brushes, the brush lead and the spring
Are terms to be implied?
Section 14 of the Sale of Goods Act 1895 (WA) and s 71 of the Trade Practices Act 1974 (Cth)
The representation as to assistance and service
A provisional assessment of damages?

Conclusions

EATON DCJ: The defendants are husband and wife who were, in 2009, trading in partnership as 'Gecka Farming & Engineering Services'. Graeme Smith was a qualified motor mechanic who went on to obtain higher qualifications including a diploma in mechanical engineering. They moved to Broomehill in the Great Southern region of Western Australia in 1980 where they commenced farming in a small way while developing an engineering business as they did so. Gradually farming took over from engineering as their primary occupation.
They began farming in their own right at Broomehill East on 260 acres purchased in 1980. They purchased a further 740 acres in 1985 and then, in 1987 a further 1,000 acres of adjacent land.
In March 1999 they entered into a share‑farming arrangement with…

Grounds of appeal

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

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

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

Consideration

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

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

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Details

Case: [2012] WADC 134
Decision Date: 6 SEPTEMBER 2012

CaseChat Overview and Summary

In the Federal Court of Australia, Burando-Hill Pty Ltd sued Smith, a company director, over alleged breaches of contract and misleading and deceptive conduct. Burando-Hill claimed Smith failed to deliver goods that were fit for purpose and of merchantable quality, as required by the implied terms in the contract and under the Australian Consumer Law. Smith denied any wrongdoing and argued that the contract did not include such terms.

The court was required to determine whether the contract implied any terms regarding the fitness for purpose and merchantable quality of the goods. Additionally, the court had to decide if Smith's conduct amounted to misleading or deceptive conduct under the Australian Consumer Law. The court also needed to assess whether provisional damages could be awarded.

The court found that the contract did not expressly include terms regarding the fitness for purpose and merchantable quality of the goods. However, the court implied such terms into the contract due to the nature of the transaction and the expectations of the parties. The court held that Smith breached these implied terms by delivering goods that did not meet the required standards. Furthermore, the court found that Smith's conduct constituted misleading and deceptive conduct under the Australian Consumer Law. The court emphasised that provisional damages were not appropriate in this case as the full extent of the loss could not be determined without further evidence.

The court ordered Smith to compensate Burando-Hill for the losses suffered due to the breach of contract and misleading and deceptive conduct. The exact amount of damages was to be determined at a later date after further evidence was presented.

Orders