Ekers v Merington No. Scciv-01-1079

EKERS v MERINGTON
[2002] SASC 57
Magistrates Appeal

GRAY J: This is an appeal against a magistrate’s decision to dismiss an action arising out of the sale and purchase of a miniature horse.
Background
Colette Ekers the appellant and Julie Merington the respondent were the owners and breeders of miniature horses. These are horses of a separate and distinct breed that fit into two categories those not exceeding 34” as an adult and those not exceeding 38” as an adult. The breed standard provides:
“if there were no size reference, the miniature horse might give the illusion of being a full sized horse…The general impression should be one of refinement, symmetry, agility and an alert intelligence.”
Ms Merington resided in Western Australia. She placed several advertisements in the South Australian Miniature Horse Association’s (“the Association”) magazine.
Ms Ekers was a member of the Association. She read the advertisements and made telephone contact with Ms Merington. She expressed an interest in purchasing a miniature horse.
Numerous telephone conversations followed and during 1997 Ms Ekers orally agreed to purchase a horse, Corporate Image for $8,000.00. It was also agreed that the signing of a written contract and delivery would be delayed. In December 1997 Corporate Image arrived in South Australia.
Ms Ekers complained that the horse was suffering from recurring mucoid nasal discharge and locking stifle in the right hind leg. She said that as a result, Corporate Image was not suitable for showing or breeding purposes. This was disputed by Ms Merington.
Proceedings were commenced for breach of contract. In the alternative, allegations of misleading and deceptive conduct were made pursuant to the Trade Practices Act 1974 (Cth). Claims were also made pursuant to the Fair Trading Act 1987 (SA) and the Misrepresentation Act 1972 (SA).
The amended statement of claim included the following:
“By an agreement evidenced in writing dated 23 December 1997 (‘the Agreement’), [Ms Ekers] agreed to purchase from [Ms Merington]… the horse for the price of $8,000.
It was an implied term of the Agreement that the horse would be:
- fit for the purpose of showing at miniature horse shows; and
- fit for the purpose of standing at stud;
Particulars
In a letter dated 24 April 1997 from [Ms Merington] to [Ms Ekers], [Ms Merington] states that the horse was ‘a definite show quality colt and herd sire for the future’
Pursuant to the agreement, [Ms Ekers] paid the purchase price and took delivery of the horse.
In breach of the said implied terms, the horse was not fit for the purposes, or either of them.
Particulars
The horse suffers from a locking stifle in the right hind leg.
- the horse suffers from recurring mucoid discharge.”
The Trial
Both Ms Merington and Ms Ekers gave evidence at the trial. They provided materially different accounts of the contents of the telephone converstions that were made prior to the delivery of Corporate Image. Their evidence about the horse’s condition also conflicted.
Ms Ekers relied upon written correspondence and video footage of the horse prior to and after delivery. Two veterinarians, Drs Suzan and Pacillo gave evidence. Ms Ekers’s mother and a farrier also gave evidence. Various veterinary reports were before the magistrate.
Ms Merington relied upon the evidence of a miniature horse judge who had awarded Corporate Image with a prize at the Royal Adelaide show. It was accepted by Ms Ekers that the horse had been shown at various shows between September 1998 and March 1999 and had been awarded prizes. A veterinarian, Dr Marmion was called and other persons who were familiar with the horse prior to delivery.
Counsel for Ms Merington contended that the Trade Practices Act did not apply given that neither party to the action was a corporation. The magistrate accepted this contention and did not further consider the Trade Practices Act. On appeal it was suggested that because telephones had been used in negotiations the Trade Practices Act applied. This submission had not been advanced at trial. In the circumstances I consider that it would be unfair to allow the issues to be raised for the first time on appeal.
It was further contended that any false, misleading or deceptive conduct occurred in Western Australia which meant that the South Australian legislation did not apply. The magistrate accepted this contention.
It was further submitted that the Misrepresentation Act had no application because the contract relied upon was made in Western Australia. The magistrate agreed. He said that it followed that any plea of misrepresentation had to be approached as if the common law applied.
The Magistrate’s Conclusions
The magistrate rejected Ms Ekers’ claims and dismissed the action. He accepted both Ms Ekers and Ms Merington as honest witnesses. He preferred the evidence of Dr Marmion to that of the other experts and found that Corporate Image did not suffer from locking stifle. He found that Mrs Merington had no knowledge of the condition of recurring mucoid nasal discharge so far as it related to Corporate Image and he was not satisfied that the condition was present prior to delivery. These factual findings would in the ordinary course lead to the rejection of the alternative claims. However as earlier observed, the magistrate rejected the Trade Practices claim as no corporate body was involved.
Issues on Appeal
Credit
Counsel for Ms Ekers complained that the magistrate should have rejected the evidence of Ms Merington. The magistrate’s findings as to credit were as follows:
“Whilst the plaintiff impressed me as an honest witness, so too did the defendant.
My impression is that the plaintiff now believes that she was deliberately mislead by the defendant. My view of the defendant is such that I cannot accept that she was deceitful in her conversations with the plaintiff.
…what the defendant says about the condition of Corporate Image is corroborated albeit in brief form, by the two witnesses who were called to give evidence by audio link. The defendant was sufficiently proud of Corporate Image to have taken a photograph of the horse immediately prior to departure. My view of the defendant is that she is a person of repute…”
On appeal it was suggested that an inconsistency arose in correspondence emanating from Ms Merington. The substance of Ms Ekers’s complaint was that a letter of 24 April 1997 asserted that the Corporate Image bloodline was sound when Ms Merington knew that this was not so. This was said to be evidenced by her letter dated 9 September 1998. It was said that the magistrate failed to have sufficient regard to this conflict and that this tainted his findings.
The 1997 letter relevantly stated:
“Savannah is a very pretty little filly, almond shaped, eyes small muzzle, and a petite head. High tailset and thick tail. Very fine in the legs but has the substance of body, good depth of chest and lovely length of reign.”
The 1998 letter included the following:
“Savannah I must admit had at the age of 5.5 months shocking back legs after being born and up to the age of 5.5 months good straight legs, only to turn cow-hocked and turning those back feet out, not tracking straight and moving like a duck! Twelve months later magically she is now sound in those back legs.”
Counsel for Ms Ekers accepted at trial that Ms Merington was not given an opportunity to comment. The asserted inconsistencies were not put in cross-examination. It was critical that Ms Merington be given this opportunity as credit was in issue[1]. There may be explanations for the apparent conflict. On appeal, a number of possibilities were advanced. This complaint must be rejected.
[1] Browne v Dunn (1894) 6 R 67; Allied Pastoral Holdings v Commissioner of Taxation Pty. Ltd. [1983] 1 NSW LR 1 at 16; Reid v Kerr [1974] 9 SASR 367 at 374
In Devries v Australian National Railways Commission[2] Brennan, Gaudron and McHugh JJ observed:
“More than once in recent years, this Court has pointed out that a finding of fact by a trial judge, based on the credibility of a witness, is not to be set aside because an appellate court thinks that the probabilities of the case are against - even strongly against - that finding of fact. If the trial judge’s finding depends to any substantial degree on the credibility of the witness, the finding must stand unless it can be shown that the trial judge ‘has failed to use of has palpably misused his advantage’ or has acted on evidence which was ‘inconsistent with facts incontrovertibly established by the evidence’ or which was ‘glaringly improbable’.”
[2] (1992-93) 177 CLR 472 at 479
This passage was approved by Gaudron, Gummow and Hayne JJ in State Rail Authority of New South Wales v Earthline Constructions Pty. Ltd. (In liq).[3]
[3] (1999) 160 ALR 588
The magistrate had the advantage of observing both Ms Ekers and Ms Merington giving evidence. It has not been suggested that he has had regard to any irrelevant material. He had regard to all relevant considerations. No error of law has been identified. Having reviewed all of the evidence, I am satisfied that the magistrate’s conclusion as to credit was open. He was entitled to place little weight on the suggested inconsistency. The challenge to the finding that Ms Merington’s account was honest must be rejected.
Preference of Expert
Several experts gave evidence. Written expert reports were also tendered.
Dr Suzan a veterinary surgeon and Dr Pacillo, the treating veterinarian were called by Ms Ekers.
Dr Suzan concluded that the horse suffered from catching stifle. He did not give evidence about the nasal condition.
Dr Pacillo examined Corporate Image when the horse arrived from Western Australia on 17 December 1997 and on subsequent occasions. In substance, he considered that the recurring nasal condition was congenital and that at that time there was no sign of stiffness in the horse’s hind legs. Signs of stiffness were not observed until 6 March 1998. On 10 November 1999 he refused to sign a certificate of soundness and failed the horse because “signs of locking stifle were evident in the right hind leg”.
Dr Marmion was called by Ms Merington. His evidence did not support a finding that Corporate Image suffered from locking stifle.
Dr Marmion gave evidence that Corporate Image had suffered from bacterial sinusitis and that the nasal discharge was attributable to the horse being floated from Western Australia. He was of the view that catching stifle and locking stifle were distinguishable conditions. They were not degrees of the one condition. He said:
“Locking stifle, the patella will lock at the top of the groove and the hind leg will be unable to move behind the horse until the patella unlocks. If you want to term ‘catching stifle’ which is a very loose term, it is where the patella may at the top of the groove slightly catch there or show an abnormality of the gait while the horse is walking or trotting of the leg.
…
To put is as best I can, as the kneecap or patella moves into its groove, when it’s at the top of the groove, one of the ligaments gets caught and if it stays fixed in that position, the stifle is said to have locked or have a locking stifle. In the normal movement in some horses, rather than move up and down the groove smoothly, when it gets to the top, you can feel that it is having a – well, catching is the word that I have used but you can feel that it has a tendency to be a bit rough at the top on palpation and that is not an uncommon thing in a lot of horses and doesn’t necessarily lead to any problems so it would be put – I would put it within a range of findings in a horse that it is not uncommon even in a normal horse. Whether the condition is such that instead of feeling the patella move awkwardly, it actually stays there and gets caught there, that’s when it becomes an upward fixation or locking of the patella.”
The magistrate preferred Dr Marmion where the evidence conflicted. He said:
“I prefer the evidence of Dr Marmion to Dr Pacillo. In my view, he has better qualifications and appeared to me to demonstrate a better understanding of the report of Dr Loose than did Pacillo.
...
Of the three expert witnesses who were called to give evidence my view is that the best qualified expert and the expert with the greatest expertise is Dr Marmion.
Dr Pacillo and Dr Suzan are both qualified veterinarians and both have had substantial experience as such. But they do not have the same post graduate qualifications as does Dr Marmion. Nor have they specialised to the same degree as has Dr Marmion in the treatment of horses in particular Dr Marmion is a ‘specialist’ in this field.”
During the course of submissions on appeal, counsel for Ms Ekers conducted a review of the expert evidence and submitted that the magistrate’s preference of Dr Marmion was unfounded and should be set aside.
The magistrate extensively reviewed the evidence of the expert witnesses. He drew attention to the weaknesses he perceived in the evidence of Drs Suzan and Pacillo. He placed considerable reliance on the fact that Dr Marmion was the best qualified expert and had extensive post graduate qualifications. He was entitled to prefer Dr Marmion’s evidence where it conflicted with the other experts. Having reviewed the evidence there is no basis for overturning the magistrate’s finding. To the contrary there was considerable support for his acceptance of Dr Marmion.
Refusal to Allow Amendment
During the trial, counsel for Ms Ekers sought to amend the pleadings to claim as an alternative that Corporate Image suffered from catching stifle. Counsel for Ms Merington opposed the amendment. The magistrate refused the application.
The application to amend raised a separate set of allegations with new and difficult factual issues, including causation and loss. An issue of failure to mitigate may also have arisen.
The magistrate’s concerns must be considered against the background that Corporate Image had been successfully shown on numerous occasions by Ms Ekers and was the holder of a number of prizes. There was nothing in the association’s constitution that precluded a horse with catching stifle from being shown. The precise nature of the condition and the likelihood of it genetically affecting future generations was unknown. Ms Ekers had neither attempted to obtain adult registration for, or breed from the horse. She had not attempted to establish what, if any, damage had been suffered or would be suffered in the future. The condition of catching stifle appeared to be intermittent.
Had the amendment been allowed, the trial would have had to have been adjourned so that the new issues could be investigated, properly prepared and litigated. The likely delay and inconvenience that would have followed would have resulted in a significant increase in costs for both parties.[4]
[4] Ms Merington had travelled from Western Australia for the hearing.
The High Court in The State of Queensland v JL Holdings Pty. Ltd.[5] considered the proper role of case flow management. It held that the interests of justice remain paramount. Dawson Gaudron and McHugh JJ said:
“Case management is not an end in itself. It is an important and useful aid for ensuring the prompt and efficient disposal of litigation. But it ought always to be borne in mind, even in changing times, that the ultimate aim of a court is the attainment of justice and no principle of case management can be allowed to supplant that aim.”
[5] (1997) 189 CLR 146 at 154
The Magistrate Court (Civil) Rules 1992 include the following:
“3     (1)    (a)     In interpreting, applying and enforcing observance of these rules, the Court and Registrar must in all things promote the expeditious, economical and just conduct and resolution of an action or proceeding.
(b)    These rules are not intended to defeat the proper action brought in good faith of any party and are to be interpreted accordingly.
(2)    In the exercise of its jurisdiction and powers the Court must attempt to determine all matters in dispute in an action so as to avoid multiplicity of actions.
(3) The Court will have regard to Rule 2 of the Supreme Court Rules 1987, subject to any necessary modification.”
Having regard to the above, Rule 2 of the Supreme Court Rules 1987 relevantly provides:
“[R 2.01]    Purpose of the Rules
2.01 These Rules are made for the purpose of establishing orderly procedures for the conduct of litigation in the Court and of promoting the just and efficient determination of such litigation. They are not intended to defeat a proper claim or defence of a litigant who is genuinely endeavouring to comply with the procedures of the Court, and are to be interpreted and applied with the above purpose in view.
[R 2.02]     System of case flow management
2.02 With the object of:
(a)     promoting the just determination of litigation;
(b)     disposing efficiently of the business of the Court;
(c)    maximising the efficient use of available judicial and administrative resources; and
(d)    facilitating the timely disposal of business at a cost affordable by parties; actions in the Court will be managed and supervised in accordance with a system of positive case flow management. These Rules are to be construed and applied and the processes and procedures of the Court conducted so as best to ensure the attainment of the above objects.
...”
Kirby J in JL Holdings Pty. Ltd. emphasised that the discretion to amend should not be fettered by rigid rules. He said[6]:
“No rigid pronouncements can be made of the way in which a discretion to permit an amendment of pleadings should be exercised. The Rules of Court affording the power to permit (or refuse) amendment are typically expressed in the widest language. This is to afford a large discretion to the judge to whom the amendment application is made.[7] It would be unwise, and contrary to principle, to fetter such a discretion with rigid rules.[8] Nevertheless, it may be helpful to direct the mind of the decision-maker to some of the considerations which have been found relevant.
The basic principle controlling the exercise of a power granted by statute, or under the authority of statute, is that the power must be exercised for the purpose for which it was afforded by the legislature.[9] In the case of Rules of Court, it may be assumed that the power was granted out of the recognition of the traditional role of the judges to do justice according to law.[10]
...
Whilst taking all of the considerations relevant to the circumstances of the case into account, the judge must always be careful to retain that flexibility which is the hallmark of justice. New considerations for the exercise of judicial discretion in such cases have been identified in recent years. But the abiding judicial duty remains the same. A judge who ignores the modern imperatives of the efficient conduct of litigation may unconsciously work an injustice on one of the parties, or litigants generally, and on the public. But a judge who applies case management rules too rigidly may ignore the fallible world in which legal disputes arise and in which they must be resolved.”
[6] at 167 and 172
[7] Londish v Gulf Pacific Pty. Ltd. (1993) 45 FCR 128 at 141
[8] United Motors Retail Ltd. v Australian Guarantee Corporation Ltd. (1991) 58 SASR 156 at 162
[9] Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR 492 at 504-506
[10] Sydney City Council v Ke-Su Investments Pty. Ltd. (1985) 1 NSWLR 246 at 252
The magistrate was faced with the difficulty of on the one hand giving effect to the magistrate’s court caseflow management rules and on the other hand balancing the interests of both parties thereby ensuring that the costs of the litigation did not exceed the modest amount claimed.
Although some $30,000 was nominally sought as damages, on appeal both counsel agreed that it would be difficult for Ms Ekers to substantiate a claim for much more than $8,000. The risk of complicating, extending the length and increasing the cost of the action was material.

The personal strain of litigation should not be underestimated. This was a material consideration to which the magistrate was entitled to have regard to.
As was said by Lord Griffiths in Ketteman v Hansel Properties Ltd.[11]:
“Whether an amendment should be granted is a matter for the discretion of the trial judge and he should be guided in the exercise of the discretion by his assessment of where justice lies. Many and diverse factors will bear upon the exercise of this discretion. I do not think it possible to enumerate them all or wise to attempt to do so. But justice cannot always be measured in terms of money and in my view a judge is entitled to weigh in the balance the strain the litigation imposes on litigants, particularly if they are personal litigants rather than business corporations, the anxieties occasioned by facing new issues, the raising of false hopes, and the legitimate expectation that the trial will determine the issues one way or the other. Furthermore to allow an amendment before a trial begins is quite different from allowing it at the end of the trial to give an apparently unsuccessful defendant an opportunity to renew the fight on an entirely different defence.
Another factor that a judge must weigh in the balance is the pressure on the courts caused by the great increase in litigation and the consequent necessity that, in the interests of the whole community, legal business should be conducted efficiently. We can no longer afford to show the same indulgence towards the negligent conduct of litigation as was perhaps possible in a more leisured age. There will be cases in which justice will be better served by allowing the consequences of the negligence of the lawyers to fall upon their own heads rather than by allowing an amendment at a very late stage of the proceedings.”
In JL Holdings Pty. Ltd.[12] Dawson, Gaudron and McHugh JJ referred to the passage from Ketteman and said:
“In this case, which is of a commercial nature, the litigants are on the one side a developer and on the other side government, and there is nothing which would indicate any personal strain which would justify the conclusion that costs are not an adequate remedy for prejudice caused by the amendment sought to the pleadings.”
Kirby J also added [13]:
“Courts now take into account the strain which litigation may place upon those involved and the natural desire of most litigants to be freed, as quickly as possible, form the anxiety, distraction and disruption which litigation causes.”
[11] [1987] AC 189 at 220
[12] (1997) 189 CLR 146 at 155
[13] The State of Queensland v JL Holdings Pty. Ltd. (1997) 189 CLR 146 at 170
It was necessary that Ms Merington have full notice of the issues that she was required to come to court to defend. Much of the trial evidence would need to have been reviewed in light of the proposed basis of the claim. Witnesses would need to have been recalled. Significant delay and wasted expense would have arisen. No terms were proffered to provide protection for Ms Merington’s position.
Given the modest nature of the claim and the magistrate’s obligation to oversee and ensure the efficient and cost effective disposal of the claim, it was open to him to refuse to refuse a substantive late amendment. There was a real risk if not a probability that the whole trial process would be rendered uneconomic. The magistrate was entitled to have regard to the personal strain and effect that would have resulted to the personal litigants involved. In the circumstances, the magistrate’s decision was within his discretion. He recognised risks of unfairness to both parties. He was entitled to act in the way that he did. The magistrate’s discretion did not miscarry.
Fresh Evidence
On appeal counsel for Ms Ekers sought to tender fresh evidence - a text ‘Adams’ Lameness in Horses’. It was said that part of the text supported the evidence of the other experts (not Dr Marmion) and suggested that there were degrees to which a patella can release and if it had a complete lock it is a locking stifle and if the release just catches it is a catching stifle. The author apparently envisaged degrees of the condition and discussed it under one heading. It was said that this was compelling evidence that they were not separate distinct conditions.
Counsel for Ms Ekers said that there was nothing in Dr Marmion’s report or the pleadings which suggested that counsel for Ms Merington was going to argue that Ms Ekers could not succeed because the horse did not have locking stifle and only had catching stifle. It was said that the text was only referred to obliquely during the course of Dr Suzan’s testimony. The text was not obtained at this time or later and consequently the evidence was not put to Dr Marmion. It was said that the need for the text only became apparent during the course of Dr Marmion’s cross-examination where he distinguished the two conditions. However, even then the text was not produced.
Counsel for Ms Ekers agreed that the introduction of fresh evidence presented problems in that it would be necessary to put the material to the other experts to enable them to comment further. However, counsel pressed the application and said that the magistrate erred in concluding that the two conditions were different without having guidance from the article. It was said that it would have taken exceptional diligence for Ms Ekers’ legal representatives to have produced the evidence at the time of trial and that the law would be brought into disrepute if the differences between the magistrate’s findings and the eminent professor’s views were left unresolved.
The principles governing the reception of fresh evidence are settled:[14]
“To justify the reception of fresh evidence or a new trial, three conditions must be fulfilled: first, it must be shown that the evidence could not have been obtained with reasonable diligence for use at the trial: second, the evidence must be such that, if given, it would probably have an important influence on the result of the case, though it need not be decisive: third, the evidence must be such as is presumably to be believed, or in other words, it must be apparently credible though it need not be incontrovertible.”
[14] Ventura v Sustek (1976) 14 SASR 395 at 399
Counsel for Ms Merington opposed the application. The text was well known, readily available and its existence was identified at trial. Dr Suzan referred to the text in his evidence. He said that he had a copy with him but had left it in the car. There was ample opportunity to obtain the text and no explanation was proffered as to why it was not obtained. Further it was submitted that prejudice would be suffered if the evidence was introduced at this stage of the proceedings. It was said that the opportunity to put the text to Dr Marmion for comment had been lost as had the opportunity for Dr Marmion to conduct additional research to obtain other evidence in support of his position.
Counsel for Ms Ekers has failed to establish the criterion necessary to satisfy the reception of fresh evidence. As earlier observed, Dr Suzan drew attention to the text during the course of the trial. The text was not obtained. The existence of the text was known. The text was available and could have been obtained with reasonable diligence. No reasonable explanation has been given for not doing so. The text is not decisive, it represents another view. The prejudice identified by counsel for Ms Merington is material. No offer to attempt to meet the prejudice was made. Accordingly the application to introduce fresh evidence must be dismissed.
Locking Stifle and Catching Stifle
As earlier observed, the magistrate found that the evidence indicated that Corporate Image suffered from catching stifle. The appellant complained that the magistrate should have found that the horse suffered from locking stifle. The magistrate based his findings on the acceptance of Dr Marmion’s evidence. His conclusions were as follows:
“Both Dr Pacillo and Dr Suzan acknowledge that their expertise with horses is not as great as that of Dr Marmion. Dr Marmion examined Corporate Image. I accept that he did so in a professionally detached manner. Despite endeavouring to produce a condition of locking in the horse he was unable to do so. He say only one time when it could be said that Corporate Image showed a locked stifle. That was on the video, Exhibit P9. Dr Marmion’s evidence is that that occasion may be explicable by the fact that the horse was strapped and rugged.
Dr Marmion’s evidence does not support a finding of lock stifle.
Dr Pacillo, despite seeing Corporate Image on numerous occasions, made an observation of lock stifle on only one occasion.
The evidence of Dr Suzan goes only so far as saying that there is a possibility that the horse suffered from locked stifle.
I find that locked stifle is a condition different from catching stifle.
...
The evidence overall indicates the probability that Corporate Image does suffer from a catching stifle. But that is not the case pleaded by the plaintiff nor is it the case which the defendant is required to meet.
The expert evidence does not support a finding that Corporate Image suffers from lock stifle.”
These are unexceptional conclusions that were open on the evidence. The challenge to the magistrate’s findings must be rejected.
Sinusitis
Counsel for Ms Ekers complained about the magistrate’s finding with respect to a nasal condition suffered by Corporate Image. It was said that the horse suffered from recurring mucoid nasal discharge. Veterinary opinions differed as to the cause and nature of the condition. A number of possible causes and alternative conditions were identified. The magistrate found as follows:
“There is no evidence that Corporate Image suffered or was suffering from this condition [recurring mucoid nasal discharge] prior to it being floated from Western Australia to South Australia. The defendant gave evidence, which I accept, that at the time when she sold the horse and in the period of time leading up to delivery of the horse to the plaintiff, that Corporate Image showed no signs of nasal discharge.
...
I accept the defendant’s evidence that there was no such condition in the horse at the time of sale or prior to delivery. The plaintiff’s assertion based upon that evidence is not made out. Not only did Corporate Image not suffer from recurring mucoid nasal discharge prior to its delivery into South Australia, but the defendant did not know nor had she any reason to believe that Corporate Image suffered or would in the future suffer symptoms of that nature.”
The magistrate preferred the evidence of Dr Marmion who was of the view that Corporate Image had suffered from bacterial sinusitis.
There is no evidence that the condition suffered by Corporate Image was Ms Merington’s responsibility. Its aetiology is unclear. The magistrate’s conclusions were open on the evidence. No error has been demonstrated. The magistrate’s findings should not be disturbed.
Fitness to Show
Counsel for Ms Ekers claimed that it was either an express or implied term of the contract that Corporate Image would be fit for showing at miniature horse shows. The magistrate held:
“There is nothing within the contract of sale, Exhibit P5 which requires the implication of a term to this effect.
Leaving aside what the plaintiff can or cannot establish concerning the terms of the contract or the representations made there is, in any event, a short answer to the plaintiff’s claim that Corporate Image was not fit for showing.
The short answer to the plaintiff’s assertion in this regard is the acknowledgment by the plaintiff that Corporate Image was, in fact, shown at various miniature horse shows as alleged by the defendant in para 4.2 of the defence. The plaintiff’s answer or response when questioned as to how it could be that the horse was not fit for showing but yet capable of winning the various awards referred to was to assert that the plaintiff was experienced in showing horses and was able to present the horses in such a manner that the defects complained about were not apparent. The plaintiff said that she could ‘dress up’ the horse for showing so that the defects complained of did not come to the attention of the show judge. Accepting that evidence of the plaintiff at its face value means that Corporate Image did not suffer from a condition which prevented the horse from being shown. Corporate Image has won a number of awards. In my view, that is a complete answer to the plaintiff’s assertion in this regard.”
A claim of misrepresentation was advanced. The magistrate found:
“…I now find also that the letter of 24 April 1997 constitutes a representation that Corporate Image would be fit for showing.
So far as the latter aspect is concerned, I have previously indicated that the plaintiff’s claim that Corporate Image was not fit for showing cannot be upheld in light of her evidence of her ability to show Corporate Image successfully.”
Counsel for Ms Ekers complained about the magistrate’s finding that Corporate Image was fit to show. It was said that this finding was not open on the evidence:
“because you don’t buy an $8,000 miniature horse to show it for less than one season, and then paddock it.”
It was accepted by counsel for Ms Ekers that the horse had been successfully shown in seven separate shows between September 1998 and March 1999. In March 1998 the catching stifle condition was identified. In the September of that year, Corporate Image was shown and won second prize in the State’s top miniature horse show.
Counsel for Ms Ekers submitted that there were other difficulties. The association also required horses to be registered. Registration could only be effected with a soundness certificate. Rule 21 of the association’s constitution may preclude the registration of a miniature horse with “locked stifle”. Without registration a horse was ineligible to show under the association’s constitution and was unable to establish a reputation enabling it to attract stud fees. It was said that the fitness to show and stud purposes were inextricably linked. However the constitution did not preclude registration of a horse with catching stifle.
The magistrate was entitled to conclude that the condition did not affect the horses’ fitness for showing. It is possible that on some future occasion if the horses stifle caught whilst it was being judged a difficulty may arise. However there was no evidence as to the likelihood of this happening or the detrimental consequence which may flow. On appeal there was speculation about the possible loss of reputation that would result if such a circumstance was to transpire, however no evidence was led to allow any assessment of such loss.
Stud Purposes
Counsel for Ms Ekers claimed that it was an express or implied term of the contract that Corporate Image would be fit for the purpose of standing at stud. The magistrate concluded:
“I find that it was an implied term of the contract of sale between plaintiff and defendant that Corporate Image be fit for the purpose of standing at stud. In the sales contract, Exhibit P5, eventually executed by both parties and by clause 11 headed ‘Breeding shares’ the contract provides that:
‘Seller will retain three (3) breeding shares in the abovenamed horse. The said three (3) breeding shares or part thereof are transferable if the abovementioned horse is sold on.’
The inclusion of that clause within the contract of sale requires there to be an implication that it was a term of the contract that Corporate Image be fit for the purpose of standing at stud. The reference to breeding shares in the contract of sale makes no sense unless it was understood between the parties that Corporate Image would be fit for breeding and hence fit for standing at stud.
...
I do, however, make the point that whilst I agree with the contention that there is an implied term that Corporate Image be fit for breeding the assertion upon which the breach of contract relies is the assertion that Corporate Image suffered from a locking stifle and from recurring mucoid nasal discharge.”
A parallel claim was also pursued in misrepresentation. In a letter to Ms Ekers dated 24 April 1997, Ms Merington wrote “...this colt is really delicious and first class in my opinion...” The magistrate found this to be in the nature of puff. The letter also contained the following words: [Corporate Image is] “A definite show quality colt and herd sire for the future.” The magistrate found that this:
“Constitutes a representation that Corporate Image would be fit for showing. The statement ‘herd sire for the future’ is a representation that the colt would be fit for breeding.
Whilst I do not accept that there were direct representations as stated by the plaintiff in her evidence, for reasons previously given I am satisfied that it was an implied term of the contract of sale that the horse be fit for the breeding.”
He also found:
“The plaintiff agreed to pay $8,000 for Corporate Image. If find upon the evidence that a horse, even a miniature horse, which is sold as a pet or for ordinary riding is probably worth something in the order of $1,000. The fact that the defendant was expecting $8,000 and the plaintiff was agreeing to pay $8,000 in itself indicates that both understood that Corporate Image would be more than just your average horse.”
As earlier observed a finding of catching stifle did not preclude Ms Ekers from applying to register Corporate Image with the Association. No attempt was made to obtain adult registration for the horse.[15] No attempt was made to prove that the horse was in fact fertile. No attempt was made to breed from the horse. No attempt was made to use the horse for stud purposes with the caveat that the effect on progeny could be assessed. There was no evidence about the life expectancy of the horse or for how many years it could be expected to be fit for stud work. There was virtually no evidence about the stud fees and the profit that Ms Ekers expected to receive, the costs, outlays and risks involved or the prospects of the average successful miniature horse breeder.
[15] Temporary registration was obtained but no attempt was made to pursue permanent adult registration.
As earlier observed, Corporate Image had been successfully shown in the past. There was no attempt to keep showing the horse until such time as it locked its stifle whilst being judged and a decision was made for it to be disqualified. Any decision by the association to exclude a horse from registration is discretionary.
The issue of causation was not properly ventilated. The necessary causative link was not established. There was no evidence to exclude the possibility that the problems were caused after the horse arrived in South Australia. Many issues were partially dealt with and either not put to the appropriate witness or were not fully advanced and not supported by the evidence. Evidence that may have clarified and assisted was not obtained. The magistrate was entitled to reject the claim in breach of contract. His findings that Corporate Image did not suffer from locking stifle and remained fit to show justify the finding that the contract had not been breached. He was entitled to reject the claim of misrepresentation. His factual conclusions were open on the evidence. No error has been demonstrated.
Conclusion
The magistrate was fully justified in dismissing Ms Ekers’s action. No error has been demonstrated on appeal. All of the findings complained of were open on the evidence.
Given that the factual findings of fact were not successfully challenged, the alternative statutory claims must fail. The essential findings necessary to support these causes of action were not made. It is unnecessary to further consider the applicability of these arguments or the interstate aspects of the case.

This appeal must be dismissed.
LIST OF CITATIONS AS THEY APPEAR IN JUDGMENT
1 Browne v Dunn (1894) 6 R 67; Allied Pastoral Holdings v Commissioner of Taxation Pty. Ltd. [1983] 1 NSW LR 1 at 16; Reid v Kerr [1974] 9 SASR 367 at 374
2 (1992-93) 177 CLR 472 at 479
3 (1999) 160 ALR 588
4 Ms Merington had travelled from Western Australia for the hearing.
5 (1997) 189 CLR 146 at 154
6 at 167 and 172
7Londish v Gulf Pacific Pty. Ltd. (1993) 45 FCR 128 at 141
8 United Motors Retail Ltd. v Australian Guarantee Corporation Ltd. (1991) 58 SASR 156 at 162
9 Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR 492 at 504-506
10 Sydney City Council v Ke-Su Investments Pty. Ltd. (1985) 1 NSWLR 246 at 252
11 [1987] AC 189 at 220
12 (1997) 189 CLR 146 at 155
13 The State of Queensland v JL Holdings Pty. Ltd. (1997) 189 CLR 146 at 170
14 Ventura v Sustek (1976) 14 SASR 395 at 399
Orchard v Orchard (1972) 3 SASR 89
Ladd v Marshall [1954] 1 WLR 1489 at 1491
15 Temporary registration was obtained but no attempt was made to pursue permanent adult registration.

Orchard v Orchard (1972) 3 SASR 89
Ladd v Marshall [1954] 1 WLR 1489 at 1491

[2002] SASC 57

8 March 2002