| JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA LOCATION : PERTH CITATION : DESIGN A TOUR (WA) PTY LTD -v- H D SERVICES PTY LTD [2003] WADC 283 CORAM : COMMISSIONER GREAVES HEARD : 12-14 MAY, 21-23 OCTOBER 2003 DELIVERED : 19 DECEMBER 2003 FILE NO/S : CIV 1029 of 2002 BETWEEN : DESIGN A TOUR (WA) PTY LTD Plaintiff
AND
H D SERVICES PTY LTD
Defendant
Catchwords: Contract - Contract for services - Assessment of damages - Failure to prove causal link between breach and loss - Turns on its own facts
Legislation: Nil
Result: Judgment for the plaintiff $19,013.50
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Representation:
Counsel:
Plaintiff : Mr K N Allan
Defendant : Mr A P Hershowitz
Solicitors:
Plaintiff : Ilberys
Defendant : Basile Hawkins
Case(s) referred to in judgment(s):
Nil
Case(s) also cited:
Nil
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1 COMMISSIONER GREAVES: The plaintiff alleges the defendant was in breach of a contract made on or about 30 March 2001 for the repair of the plaintiff's OKA four-wheel drive tour vehicle. The plaintiff alleges the OKA broke down after the defendant had repaired it. The defendant admits it was in breach of the contract for repair. The plaintiff alleges the defendant's breach of contract caused the plaintiff the loss and damage pleaded in pars 14, 15 and 16 of the amended statement of claim as follows:
"14. By reason of the Defendant's breach of the contractual terms and breach of duty of care the Plaintiff has suffered loss and damage as indicated in the following paragraphs.
15. Expenses.
Particulars of Expenses
The Vehicle was to be used by the Plaintiff for tours in the Northwest region of Western Australia during the 2001 Pilbara tourist season. During the period that the Vehicle was unserviceable because of the mechanical damage, the Plaintiff suffered the following loss and damage: (a) The costs of parts, labour, freight and taxes associated with the repairs to the Vehicle carried out by Truck Mart Diesel Marine and Hydraulic Services, Karratha. (b) A replacement vehicle was required for a four days tour in the Karijini National Park commencing on 8 April 2001. This tour was booked by the Western Australian Tourism Commission and was a Visiting Journalist Program international journalist familiarisation tour ('the VJP tour'). A replacement vehicle was hired from Avis for 4 days. (c) Due to the Vehicle not being available at the conclusion of the VJP tour the Plaintiff's driver, Edward Riggall resigned from his employment with the Plaintiff and the Plaintiff was obliged to pay the cost (sic) an airfare for the driver from Karratha to Perth by Ansett on 11 April 2001.
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(d) The Plaintiff was required to fly an employee, Tim Baird from Darwin to Karratha by Qantas on 31 May 2001 to collect the Vehicle, conduct a tour to Coral Bay ('the Coral Bay tour') and train a new driver. (e) The Plaintiff incurred the costs of training a new driver to replace Edward Biggall. The training took place over 7 days with an estimated cost of $200.00 per day. (f) The Plaintiff was required to pay for accommodation for Tim Baird in Karratha from 31 May 2001 to 2 June 2001 at the Peninsula Palms Hotel. (g) The Plaintiff was required to hire a motor vehicle for Tim Baird to use in Karratha while organising the Coral Bay tour. (h) The Vehicle was not ready for the Coral Bay tour. A replacement vehicle was hired from Hertz between 2 June 2001 and 8 June 2001.
Summary of Expenses
(a) Replacement Vehicle for VJP tour $1,101.11 (b) Airfare for Edward Riggall $469.70 (c) Airfare for Tim Baird $1,078.00 (d) Costs of training new driver $1,400.00 (e) Accommodation $77.00 (f) Hire car $160.88 (g) Replacement vehicle for Coral Bay Tour $988.19 TOTAL $5183.88
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(b) Due to the change of the four wheel drive day tour from Tom Price into a bus tour as particularised in the preceding paragraph a number of passengers cancelled their bookings and the number of passengers who purchased tickets from the Plaintiff for day tours decreased. The Plaintiff estimates that 30 passengers were lost due to the change in vehicle for the day tours. Profit per passenger is calculated as follows: $43,811.30 ÷ 779 = $56.24 per passenger The Plaintiff's estimated loss of income due to cancellations and decreased bookings is $1,687.20. (c) (i) The Plaintiff was contacted on two occasions during the 2001 tourist season by Broome Eco Tours to offer the Plaintiff the opportunity to conduct a charter tour. The Plaintiff declined the offers on both occasions as there was no appropriate vehicle available. (ii) As a result of the Vehicle being unavailable the VJP tour was conducted in a sub-standard vehicle. The replacement vehicle was a Toyota Landcruiser Troop Carrier which was not fitted out or modified for tourist operations. Deficiencies in the replacement vehicle included, inter alia, inadequate airconditioning, inward facing bench seat for passengers, no microphone for guide, no seatbelts for passengers. Further, the fact that the vehicle could be hired by any member of the public negated the perception that tourists need to book a tour to see the best of the areas included in the tour. As a result the overall perception of the tour was diminished. The Plaintiff relies on VJP tours as important marketing opportunities and by reason of the above has not been engaged for international famil tours and is unlikely to ever be engaged in the future.
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(d) As a result of the matters particularised in paragraphs (c)(i) and (c)(ii) above the Plaintiff estimates that it lost or will lose 117 passengers for extended tours in the 2001 Pilbara tourist season and will continue to lose a similar number of passengers over the next 5 years. For a 10 day tour the profit per passenger after deduction of all costs is $749.77. The Plaintiff's estimated lost income is $87,723.09 for the 2001 Pilbara tourist season and will continue to suffer similar annual losses for at least the next 5 years."
Paragraph 15(a) of the statement of claim 2 The plaintiff abandoned this head of claim before me.
Paragraph 15(b) of the amended statement of claim 3 The parties agreed this head of claim in the sum of $873 before me.
Paragraph 15(c) of the amended statement of claim 4 The plaintiff abandoned this head of claim before me.
Paragraph 15(d) of the amended statement of claim 5 The evidence for the plaintiff was that this airfare was paid for by the use of frequent flyer points in the name of Mr Tim Baird. The plaintiff tendered exhibit 25 as evidence that the current cost of this airfare is $886.89. In my view the evidence establishes that is a reasonable sum.
Paragraph 15(e) of the amended statement of claim 6 The plaintiff claims the sum of $1,400 under this head which was an estimate of the cost to the plaintiff of in-house training. The amount claimed seems to me to be excessive and I would allow $100 per day or a total of $700 under this head.
Paragraph 15(f) of the amended statement of claim 7 This head was agreed at $77 before me.
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Paragraph 15(g) of the amended statement of claim
8 This head was agreed at $160.88 before me.
Paragraph 15(h) of the amended statement of claim 9 This head was agreed at $736.19 before me.
Paragraph 16(a) of the amended statement of claim 10 The evidence for the plaintiff in relation to this head of claim was not easy to follow. The sum of $17,527.50 is an estimate of the difference between the profit the plaintiff might have earned using the OKA vehicle for day tours during the 2001 season and its actual profit using the replacement bus. The evidence for the plaintiff was that it was necessary to reduce the charge for a day tour from $120 to $95. The plaintiff relied on exhibits 7 and 13. The evidence is confusing. I do not accept the submission of counsel for the plaintiff that it is plain and obvious the charge made was $95. I think it is more likely it was $99 on the basis of exhibit 13. Exhibit 13 also demonstrates that 34 passengers were half-day passengers and six children at half fare. Taking these matters into account, I would reduce the plaintiff's claim under this head by $4,000 and allow it in the sum of $13,527.50.
Paragraph 16(b) of the amended statement of claim 11 This head of claim is for loss of profit in the sum of $1,687.20 for passengers allegedly lost due to the change in vehicle for the Tom Price day tours. At T54, Mr Ian Baird said that he estimated 30 passengers from trading in the previous year. Counsel for the defendant submitted the estimate is without foundation in fact and that therefore the plaintiff has failed to establish this loss on the balance of probabilities. I do not accept that submission. No question of credibility arises. I accept the evidence of Mr Baird. In my opinion this head of claim should be allowed in the sum of $1,687.20.
Paragraph 16(c) of the amended statement of claim 12 The plaintiff gave no particulars of the amount of this claim. The defendant admitted the assessment of $364.84. In my opinion, the plaintiff is entitled to recover that sum.
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Paragraph 16(d) of the amended statement of claim
13 Under this head, the plaintiff claims damages for loss of profits from 2001 until judgment and for five years from judgment arising from alleged loss of business. The plaintiff claims the loss of business occurred and will continue to occur owing to the publicity or lack of it experienced following the familiarisation tour conducted in the Karijini National Park over four days from 8 April 2001. It was common ground this tour was booked by the Western Australian Tourism Commission as part of a visiting journalists' programme. The case for the plaintiff was that such a tour provides an important marketing opportunity. The plaintiff alleges the publicity derived from the tour occasioned loss of business from tourists. The plaintiff also alleges that since April 2001 the plaintiff has not been engaged by the Western Australian Tourism Commission to undertake such familiarisation tours and has therefore likewise lost the opportunity for publicity and consequent business. It will be observed this head of loss represents a substantial proportion of the plaintiff's claim. 14 The plaintiff relies on a loss of profit per passenger after deduction of all costs in the sum of $749.77. The onus of proof is on the plaintiff to establish on the balance of probabilities on the evidence that it has suffered and will suffer the alleged loss as a result of the breakdown of the OKA vehicle. The plaintiff must prove a causal link between the breach of contract of the defendant or its negligence resulting in the breakdown of the vehicle and the alleged loss. If causation is established, the defendant then pleads in par 12 of the amended defence the alleged loss is too remote for the defendant to be found liable for that loss. 15 On behalf of the plaintiff, Mr Baird gave evidence that he spoke to one Jim Mills on behalf of the defendant and said (T248): 16 The defendant did not call Mr Mills and I accept the plaintiff's evidence of the conversation.
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17 The evidence for the plaintiff was that the April 2001 tour generated subsequent publicity, but the plaintiff did not produce it. In cross-examination, counsel for the defendant showed the plaintiff exhibit 16 written by a Canadian journalist in February 2002. Counsel took Mr Baird through the article. It is complimentary and enthusiastic. At T171, Mr Baird observed the journalist made no reference to the plaintiff or contact details for the plaintiff. He said he believed the article would have been more favourable if it had contained more description of the plaintiff.
18 The plaintiff led no evidence from journalists who regarded the 2001 tour as less than satisfactory. As I have observed, the plaintiff also claims that the publicity or lack of publicity generated by the April 2001 tour resulted in the Western Australian Tourism Commission not engaging the plaintiff to conduct subsequent tours. The evidence discloses (T142) that the plaintiff conducted a familiarisation tour in November 2001. The evidence of Mr Baird was the plaintiff conducted no subsequent familiarisation tours. The defendant called Mr Richard Thomas, the executive director of marketing and communication at the Western Australian Tourism Commission. He said (T386): 19 Mr Thomas went on to say he was not aware of a decision by the Tourism Commission to stop the plaintiff carrying out familiarisation tours. He was not aware of anything which would stop the plaintiff from getting familiarisation tours in the future. I accept the evidence of Mr Thomas. 20 Much of the evidence for the plaintiff emphasised the importance to the plaintiff of the familiarisation tours. I accept their importance. In my opinion, however, the plaintiff has failed to prove on the balance of probabilities the April 2001 tour resulted in publicity or lack of publicity and a consequent reduction in the number of passengers and loss of profits as alleged. In those
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circumstances, it is not necessary to consider the question of remoteness or quantum. The plaintiff's claim under this head must fail.
Conclusion 21 Accordingly, the plaintiff is entitled to judgment in the sum of $19,013.50.
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