Extreme Tours (WA) Pty Ltd v Alucraft Boats Pty Ltd - [2008] WADC 48

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION: PERTH

CITATION: EXTREME TOURS (WA) PTY LTD -v- ALUCRAFT BOATS PTY LTD [2008] WADC 48

CORAM: O'SULLIVAN DCJ

HEARD: 26, 27, 28, 29, 30 NOVEMBER 2007, & 12, 13, 14, 15, 19 FEBRUARY 2008

DELIVERED : 8 APRIL 2008

FILE NO/S: CIV 2467 of 2005

BETWEEN: EXTREME TOURS (WA) PTY LTD
Plaintiff
AND
ALUCRAFT BOATS PTY LTD (060 330 949)
Defendant

Catchwords:

Contract - Statements of a promissory nature preceding contract - Trade Practices Act - Misleading and deceptive conduct - Assessment of damages

Legislation:

Trade Practices Act 1974 (Cth) s 52

Result:

Judgment for the plaintiff

Representation:

Counsel:

Plaintiff: Mr H O Moser
Defendant: Mr P A Kyle

Solicitors:

Plaintiff: K G Sorensen
Defendant: Kyle & Company

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

Nil

O'SULLIVAN DCJ: The plaintiff operates an adventure boating business under the name of West Coast Jet. It is based in Fremantle and takes customers for "thrill rides" on a boat called the OKIEDOKIE.
The defendant is a designer and builder of boats and built the OKIEDOKIE (then called The Extreme) for the plaintiff in 2000.
In 2004 the defendant fitted a jet propulsion system to the vessel and this case relates to the dealings between the parties in relation to that work and subsequent events.

Background

The OKIEDOKIE is 11.65 metres long, weighs just over 7 tonnes fully laden, and carries 22 passengers and two crew. It is a monohull, designed to plane and has a steep deadrise angle. The "deadrise angle" refers to the shape of the V of the hull under the water.
When it was first constructed the OKIEDOKIE was fitted with twin 250 horse power Mercury Cruiser outboard motors which allowed it to travel in a straight line at about 40 knots per hour, but its manoeuvrability was limited and there were problems with the motors.
In 2003 two 300 horse power Yanmar diesel engines were fitted with stern drives because these were more reliable, but again manoeuvrability was limited.
It is the plaintiff's case that jet units were fitted to the vessel in order to enable it to perform what are known as "spins, fishtails and bucket stops".
Although there were some differences in the evidence as to the meaning of these terms and I will return to those differences later in these reasons, it is enough for present purposes to say the following:-
A spin occurs when the boat breaks out from a circle in which it is turning and rotates about its centre of mass.
A fishtail describes the motion of a boat as it loses its rear end when being driven across the water in a zigzag pattern.
A bucket stop is an expression used in relation to jet powered boats because a device shaped like a bucket is lowered over the jet stream so as to divert it in the opposite direction to that in which the vessel is travelling and so bring it to a halt.
The defendant fitted what are known as Castoldis 06 jet units to the OKIEDOKIE in September 2004.
It is the plaintiff's case that thereafter, and despite many attempts, the vessel proved incapable of performing spins, fishtails and bucket stops and accordingly in May 2005 the Castoldis were replaced with other jet units which did enable it to do so.
The plaintiff says it would not have had the Castoldis fitted but for assurances given by the defendant that the vessel would have been capable of these manoeuvres and claims damages for the loss it says it has sustained.

James Virtue

Mr Virtue is a director of and the driving force behind the plaintiff's company.
In 1986 he came to Western Australia from New Zealand where he had served in the navy. He is the holder of qualifications as a marine engineer and was for some time the master of a Rottnest ferry.
In 2000 Mr Virtue started the business of the plaintiff with a partner. He had seen what are known as "shotover" boats operating in New Zealand and knew of other vessels operating on the east coast of Australia to provide customers with thrill rides and the idea was to develop a similar business in this state using a boat suited to local conditions.
This led to Mr Virtue contacting the defendant, and as a result the OKIEDOKIE was commissioned.
Mr Virtue said that he met and dealt with the directors of the defendant Marco Serrangeli ("Marco") and his brother Anthony ("Tony") and developed a good relationship with them.
He said that after the commissioning he stayed in touch with them, calling in at the defendant's workshop from time to time and speaking with them and a Mr Brian Sims, whom he described as the workshop foreman, about boats and propulsion systems for them and related matters.
Mr Virtue said that in the course of these conversations the performances of a number of boats built by the defendant were discussed. Specifically a vessel named The Pelican and one known as The Venezuelan were mentioned, as well as one referred to as "the police boat".
The police boat, Mr Virtue said, was spoken about in 2000 at the time when the OKIEDOKIE was being built. He said that there was a photograph of it on the wall in an office of the defendant's premises. It was jet powered and he understood of a similar design to the OKIEDOKIE and it had inboard diesel engines.
Mr Virtue said that Brian Sims told him that at the sea trials of the police boat it would do bucket stops, "spin big time" and do fishtails.
This, said Mr Virtue, was confirmed by both Tony and Marco and he became excited when told of it, "thinking one day I might be able to do this with my boat".
Mr Virtue said that he was also told by Brian Sims, Marco and Tony that The Pelican, which was a larger vessel could "do all of the above" and that The Venezuelan, which was also jet powered would do slide outs (even though it was not designed for that) and bucket stops. The term "slide out" is used to describe a vessel sliding sideways across the water.
In 2003 Mr Virtue said he became interested in operating the business of the plaintiff at Mandurah. He had already taken the OKIEDOKIE there occasionally, but at this time he was approached by an organisation running a boat show and gave thought to setting up business at a marina. He said sea and weather conditions are different to those prevailing at Fremantle. The sea is often calmer and there are less waves so he gave thought as to how the OKIEDOKIE might be improved to provide exciting rides for customers. Accordingly, he gave further consideration to fitting the boat with jets.
In June 2004 Mr Virtue said that he went to see Tony and Marco Serrangeli to discuss with them the question of refitting the OKIEDOKIE with jet units. He said that he met with both of them and Brian Sims in an office at the defendant's premises. He told them of his plans to operate at Mandurah and said that he "needed more than speed". He said "I needed the boat to manoeuvre similar to other jet boats around the world".
Mr Virtue said that in answer to his specific inquiry about the ability of the OKIEDOKIE to do bucket stops with jets fitted he was told "of course". He said that on being told that:
"I felt like a bit of a dill; I was looked at as a bit of a dill because it's what jet boats did or what jet boats do."
In response to his question whether the OKIEDOKIE would do fishtails Mr Virtue said that Tony Serrangeli responded "Oh, yeah. It'll piss".
As to the ability of the OKIEDOKIE to do spins when fitted with jets Mr Virtue said that he was told "No problem, Jim. That's what jet boats do".
Mr Virtue was asked and said:
"What was your question about spins? – Will it spin, will it slide out like other jet boats in other areas and, you know, once again I felt like a bit of a dill for asking it because I was looked at like that, like, 'Come on, Jim, you know'.
When you say that you asked them about it, did you have any doubts about your boat being able to do that? – None at all, with the information that I was receiving."
Mr Virtue also said that at this meeting there was discussion about the other boats built by the defendant and previously discussed by him and Marco and Tony Serrangeli and Brian Sims.
As far as the police boat was concerned he said it:
"… came up into it because it was a very similar vessel to the OKIEDOKIE. So whatever the vessel did was – they said that my boat will do the same because of the same hull configuration."
Mr Virtue said that Brian Sims specifically mentioned The Venezuelan which was a 16 metre vessel. He said that Mr Sims said:
"That at sea trials it would do slide outs, it would do fishtails, it would do emergency stops or bucket stops as such. So there was really no reason at all mine wouldn't be able to do it. It wasn't an issue."
Mr Virtue also said that Mr Sims said that The Pelican would do slides even though it was a "big, heavy vessel".
In the course of this meeting there was also discussion about the appropriate jet units for the boat and Mr Virtue said that Marco said that Castoldi jets should be fitted. He was asked whether Marco explained why Castoldis were appropriate and he said:
"Well, he'd just become the distributor of the Castoldi jet or the master distributor of Castoldi Australia and thought it would be a good idea to put them on the OKIEDOKIE as a high profile around the area and probably good from an advertising point of view for all concerned."
Mr Virtue said that he accepted that Castoldi jets were appropriate units for the OKIEDOKIE, relying on the Serrangeli brothers with whom he had a good relationship.
There was then discussion concerning which model jets were to be fitted and one known as the Castoldi 238 was recommended by Tony, who said he would check with the factory in Italy to confirm its suitability.
A few days after this meeting Mr Virtue said that he met again with Marco and Tony at the premises of the defendant.
On this occasion he said that Tony told him that he had received advice from the Castoldi factory in Italy that the 238 model was not powerful enough for the OKIEDOKIE and that 06 model units should be fitted.
He was asked and said:
"Q:Did Tony say anything about what the 06 could do?
A:It would do the same as we discussed with regard to 180's, 360's, bucket stops and fishtailing; those manoeuvres."
Mr Virtue said that he accepted that the 06 model units should be fitted to the boat and there was then a discussion about cost. Marco, he said, quoted a sum of $22,500 per unit for two units exclusive of GST and $8‑10,000 for installing them. He asked if $60,000 would cover it and he was told that it would and he then made arrangements with his bank for an advance and the plaintiff paid a deposit of $20,000 to the defendant a short time later.
Arrangements were made for the jet units to be installed in the boat in September 2004 and on 7 September the OKIEDOKIE was delivered to the defendant's workshop after the engines had been removed.
Work then commenced and Mr Virtue said that some time later Brian Sims asked him whether he had ordered the couplings, drive plates and shafts needed to connect the engines to the jet units. Mr Virtue said that he had thought that this was work covered by the cost of installation quoted at $8‑10,000 and he spoke to Tony Serrangeli who told him that it was not.
He asked for time to pay off any extra amount and was referred to Marco who agreed to allow it.

The initial sea trials

After the work had been done the boat was placed in the water on 1 October 2004. Tony and Marco Serrangeli, Brian Sims, Andrew Joyce (the second skipper of the OKIEDOKIE), two representatives of Yanmar and Mr Virtue were present.
The boat was taken out and when instructed to do so, Mr Virtue said that he increased the power but it was very sluggish and "just didn't seem to get into plane". Mr Virtue said that the engines and jet units seemed to be very noisy and there was a lot of vibration and the boat did not respond well to the helm. It did not to turn to port or starboard as sharply as he thought it should, achieving only 15‑20 degrees of rudder on the starboard side in particular. He said 35 degrees of rudder is considered the appropriate maximum degree of turn. As for speed it only achieved a maximum of some 32 or 34 knots compared with 38 knots per hour when the stern drives had been fitted.
During the trial an attempt was also made to stop the boat using the buckets but although the vessel slowed, it would not come to a halt and when an attempt was made to make it slide by dropping only the starboard bucket, that manoeuvre also failed.
Mr Virtue said that the trial did not last long because he had to go to another meeting. He left annoyed and disappointed at the boat's performance and rang Tony Serrangeli later to speak to him about it. During that telephone conversation he said that he complained that the boat had lost speed and would not slide out or "do anything that I was told it was going to do in our previous discussion". Tony responded by saying "we'll get it right" and spoke of doing some work to improve the steering.
During this telephone conversation Mr Virtue said that he could hear Marco Serrangeli in the background and heard him say:
"Tell him to bring the fucking boat back and take the jets off and we'll put the fucking legs back on."
Mr Virtue said that upon hearing this he said to Tony that he would do so the following Monday but that Tony responded saying "We'll sort this out. We'll sort it out".
Mr Virtue attended at the boat the following morning on 2 October 2004 together with Tony and Marco and Brian Sims. Some work was done on the steering and after that the four men took the boat out for another trial. On this occasion he said that it performed a little better and "seemed to get on the plane a little quicker". The steering was also a little better but was "still not 100 per cent". However he still could not bring the vessel to a stop using the buckets (it would only slow down) and this caused significant concern he said in manoeuvring it up to a jetty.
Accordingly, after dropping Tony, Marco and Brian Sims off, he and his second skipper, Andrew Joyce, practiced bringing the boat up along side a jetty for some time.
The 3^rd and 4^th October 2004 were a Sunday and Monday of a long weekend and Mr Virtue did not work but his second skipper Andrew Joyce did. On Monday Mr Joyce rang to say that there was a problem with the buckets in that they would not lower properly.
On 5 October 2004 Brian Sims fitted new rudders to the boat to assist in manoeuvring astern which had proved a problem. This took the whole day.
On 8 October 2004 Mr Virtue said that he spoke with Brian Sims, Marco and Tony about further work that might be done to improve the boat's performance. He said that one of them suggested that a strip of aluminium running along the bottom of the keel be removed in the hope that this would assist in allowing the boat to slide out more easily. His response to that was that he was not prepared to "cut up [his] boat" and was worried about survey requirements relating to it.

The meeting on 11 October 2004

By 11 October 2004, Mr Virtue said that the performance of the boat had been "a disaster". He said (p 125):
"It wouldn't turn properly, it wouldn't stop properly, it wouldn't go astern properly. It was the worst vessel I had actually driven."
On that day he went to the premises of the defendant to speak with Tony and Marco. Before doing so he drafted a letter in the following terms:
"Dear Tony and Marco
Thank you for involving Extreme Tours WA/Westcoast Jet in your research and development programme.
It is an exciting time for us here with changing the "OKIEDOKIE" over to jet drives.
Unfortunately the jet units we have ordered are not going to be available for some time and are looking forward to trialling your 06 model until ours are delivered.
The Castoldi 06 Jets you have supplied for us to trial for your development of the 11 metre Police/Pursuit vessel have performed I think better than expected in this type of vessel for the operation you require.
There is absolutely no slip in tight turns and the vessel with it's 21 deg deadrise hugs the ocean better than any other jet unit available on the market, that I am aware of.
We have attained the same high-speeds as we had with the Mercruiser Bravo 2X legs coupled to the Yanmar 300 hp diesel engine. After around 20 hours our fuel economy looks as though it has reduced 6 litres per hour as well.
Over this last weekend we have had westerly-norwesterly winds that as you know can kick up quite a sea and a swell.
The vessel fully laden with 20 passengers performed at high speed for the entire weekend with no apparent problems. The sea state posed no problem with this type of vessel. There were a couple of occasions though where we had to slow for passenger safety running into large seas.
If I were in the market for high-speed ocean adventure only I would not hesitate in purchasing 2 of your 06 models.
Unfortunately though with the nature of my business Westcoast Jet requires a unit that slips and slides across the ocean fishtailing and letting go with tight turns.
Once again I would like to thank you for involving us and I know we can work together in the future.
Kindest regards
Jim Virtue
Director."
Mr Virtue said that he drafted this letter with a view to proposing a solution satisfactory to both the plaintiff and the defendant. A few days before 11 October he had had a conversation with Marco during which he said that Marco had told him that if he could get another jet manufacturer to guarantee that the vessel would slide out, the defendant would remove the Castoldi jets and put in the new jets free of charge. Accordingly, he said:
"The idea was to – well, to take them up on the offer basically, or to take Marco up on the offer of taking the jets off but not to say that they were failing. It was just probably that they were failing on that type of vessel, on my type of vessel … so I concocted a story for both of us, or for all of us – that's Tony, Marco and myself – which would be favourable in the event that they went along with the offer. So they would take the 06 jets off and we mentioned that they were developing a patrol craft of some sort, that I was doing some research and development for them and thanks very much for the opportunity and I'll put the other jets in because these ones track, they don't slide out and that sort of thing."
Mr Virtue said that he gave this letter to Marco and Tony and that Marco, after reading it, said "what the fuck is this?" and screwed it up and walked out.
He then had a conversation with Tony during which, he said that Tony:
" … explained to me that I hadn't given them enough time to sort the vessel out and to stick with them and they would get it going right. They offered me the fabrication for free or for no charge if I stuck with them."
The reference to free fabrication was a reference to work involved in extending the keel by 750 millimetres which, it had been suggested, would assist in allowing the boat to slide.
Mr Virtue said he told Tony that he could not "see the boat actually improving at all" and that the offer of free fabrication was great "but at the end of the day if I get free fabrication and the vessel doesn't perform I'm still not gaining anything." However, he said that Tony urged him to "stick with them" and eventually, at a time when Marco had returned to the room and had joined in the discussion again, he said:
"Okay, well we will give it a shot and see how we go."
Mr Virtue said that his understanding of the agreement reached at this meeting was as follows:
"The deal was … that they give me the extension for free, they do further research and development on the vessel and they pay for the lifts."
Mr Virtue said that following this agreement and at the same meeting there was discussion about specific ideas to improve the performance of the boat.
Tony or Marco suggested that stainless steel rudders be fitted in place of the aluminium ones which were too flexible and it was agreed that these should be ordered from Italy.

There was also a discussion about modifying the hull of the boat by cutting a V section out between the jets effectively flattening the bottom of the vessel at its stern. This, it was thought, would assist in allowing the boat to slide out. Mr Virtue said that he did not agree to do this work because it involved "cutting up my boat". However he did agree to the removal of the aluminium strip which had been discussed at the meeting on 8 October 2004.

Sea trial – 12 October 2004

The following day, 12 October 2004, the boat was lifted out of the water and the aluminium strip was removed. It was then put back and Mr Virtue then took the boat out with Brian Sims and a Mr David Mathieson. The wind was strong and he had great difficulty reversing the vessel out of the pen. Once on the open sea he attempted to get the boat to slide but it was unsuccessful. Bucket stops were also unsuccessfully attempted. The boat would slow and eventually stop but not quickly. Steering both to port and starboard was still limited to some 15 to 20 degrees of rudder.

The meeting on 14 October 2004

Mr Virtue said that on 14 October he went to the premises of the defendant and spoke to Marco who told him that the stainless steel rudders had been ordered from Italy and that he had been in touch with the Castoldi factory and received advice that he should not use a bucket to assist in turning the boat. Until then Mr Virtue had been using one bucket in an attempt to get the boat to turn more sharply to port or starboard and to slide out. Marco told him that the advice received from the factory in Italy was that this created too much pressure on the bucket mechanism and would not assist in achieving a slide out. Marco showed him a letter from Italy confirming this advice. He also gave him a letter from the defendant dated 14 October 2004 which read as follows:
"Dear Jim
Just letting you know we have spoken yesterday to the Castoldi Engineer regarding OkiDoki. We have had a very positive discussion. They are really sorry to hear that this weekend been the boat show you will not be able to turn properly or drop the bucket because of the bent shafts.
We should see the stainless replacements arrive Tuesday. The factory is quite impressed with the performance the boat is getting on a straight run, with only twin 300Hp. The Engineer told us of a case when there was a contract that required twin 06 to have 600HP each on them and the buckets had to be made stronger.
As far as the bucket goes improvements can be made. Also OkiDoki is the fastest Jet boat that Alucraft has done to date. We believe this is because of the high volume low pressure design of the jet and also to the very efficient impeller.
Next week we will confirm in writing the offer we discussed to help you out, to make the change over to Jets less expensive for you. Attached is the comment the owner has made of the Catamaran with the twin 238 we made recently.
I am sorry again you will need to say to your passengers that until next week no sharp turns or bucket dropping can be done as you are waiting on some HEAVY DUTY RUDDERS.
Regards
Marco Serrangeli
14/10/04."
Mr Virtue said that he was disappointed that he could not use the buckets to assist in manoeuvring the vessel at speed because the Mandurah Boat Show was due the following weekend but he accepted the advice because he did not want to do damage to the boat.

More steering problems

The new stainless steel rudders arrived from Italy and were fitted on 26 October 2004. The steering was tested while the boat was out of the water and the rudders appeared to be turning 35 degrees to port and starboard and this was thought to be satisfactory. A sea trial was then conducted by Mr Virtue and Brian Sims who had done this work. Despite indications on dry land that the rudders would turn 35 degrees to port and starboard in seagoing conditions they only turned some 15 to 20 degrees. Upon examining the steering mechanism the hydraulic ram operating the tie bar connecting the rudders did not appear to be fully extending and Brian Sims made a phone call to Tony for advice. He then increased the pressure in the ram so as to allow it to extend more fully. This was done in a series of steps to the point when, on one occasion, Mr Virtue said that he was able to take the boat up to high speed and upon doing a very sharp turn cause it to slide. However, on attempting to do this on a second occasion the hydraulic ram "exploded" and the steering mechanism broke.
On the following day 27 October 2004 Brian Sims carried out repairs to the steering system and installed two hydraulic rams in place of the single ram which had previously been used. After that a sea trial was conducted by Mr Virtue but he said that despite a number of attempts to do so he could not get the boat to slide nor fishtail. The fitting of a second ram resulted in it being necessary to turn the wheel of the helm three full turns to fully lock the steering mechanism to port or starboard. It was his opinion that the extra turning caused the boat to be less responsive and prevented it from breaking out into a slide.

Further problems

After 27 October 2004 Mr Virtue said that there was still a difficulty in doing a bucket stop. He said that although the boat would eventually pull up, it would not stop suddenly. This is what he required and had expected.
Mr Virtue said that he spoke with Tony and Marco about this and one of them suggested that deflectors be fitted to contain more of the thrust from the jets when the buckets were lowered so as to improve their effect in stopping the boat.
On 24 November 2004 the OKIEDOKIE was taken out of the water so that the deflectors might be installed. Upon inspection the stainless steel rudders were found to have been damaged and these were taken off for repairs to be effected. The deflectors were fitted then or on a later date.
On 16 December 2004 a further problem developed with the steering of the vessel when Mr Virtue was skippering it. Upon inspection it emerged that the second ram had broken off its mounting and this was repaired by Brian Sims.
On 19 December 2004 Mr Virtue was operating the vessel when it lost steering completely. The cause was found to be a steering pin which had sheered. The pin connects the hydraulic rams to the tiller arm. A new pin was obtained and fitted.
On 4 January 2005 the vessel again lost steering when a steering pin snapped and a new one had to be fitted.
On 11 January 2005 a problem occurred when Mr Virtue was manoeuvring the boat into the jetty with 20 passengers on board. The boat would not slow down or stop and it hit the jetty at a speed of about 5 knots. Fortunately nobody was injured. It was found that the portside bucket had jammed. The following day, 12 January 2005, Brian Sims attended to carry out repair works

Further attempts to improve performance

Mr Virtue said that by February 2005 he was still unable to manoeuvre the OKIEDOKIE so that it would slide and spin and fishtail. Accordingly, he allowed a section to be taken out of the keel of the vessel between the jets. This was work suggested by Tony in October 2004 which he had not agreed to. However he was persuaded to change his mind in the hope that if the stern section of the vessel was flattened its manoeuvrability would improve. The section was cut out and a piece of flat plat inserted. This work took two days.
A further sea trial was conducted after this and some other repair work was done on 9 February 2005. Those on board the vessel were Mr Virtue, Brian Sims and Andrew Joyce, the plaintiff's second skipper. Slide outs, fishtails and bucket stops were all attempted but without success. The speed of the vessel seemed to be less and Mr Virtue put that down to the flattening of the aft section of the keel.

16 February 2005

On 16 February 2005 Mr Virtue rang the defendant and spoke to Marco. He had been speaking with someone experienced in operating jet powered sprint boats and a previous world champion and he asked Marco if he could bring that person down to the defendant's workshop to have a look at an O6 jet unit and take some measurements with a view to devising a better steering mechanism and bucket system for it. Marco refused. According to Mr Virtue he said to him:
"We've done all we can to the vessel, the steering. We can't do any more. We are not going to do any more. It’s the only type of vessel we know attempting to do these manoeuvres."
Mr Virtue said that Marco also said to him:
"No, that's it. We've finished with your boat. We are not going to do any more work on it. That's it."
He said that he attempted to argue with Marco pointing out that the steering did not work properly and that the buckets would not go down properly and that since the V section had been cut out the vessel had lost speed. An argument ensued which became heated and Mr Virtue said that he rang off.

23 February 2005

On 23 February 2005 Mr Virtue said that he rang Tony and told him that he did not wish to deal with Marco any more. He said that he also told him that he wanted the plate removed from the hull of the vessel and the keel returned to its former shape. He also wanted the aluminium strip running along the bottom of the keel to be put back. Mr Virtue said that Tony agreed to do that.
In the course of this conversation Mr Virtue said that Tony said to him that the hull shape of the vessel prevented it from doing the manoeuvres he wanted. He said that he was flabbergasted and responded:
"Well, why now? It’s the same hull. It’s the same hull I've always had since 2000. You know, we have done a few changes but it is basically the same hull … it should have been mentioned that the hull won't do these manoeuvres before I put the jets in."
Shortly after this conversation Mr Virtue received a letter from the defendant dated 24 February 2005. It read as follows:
"Dear Jim
We regret and are sorry to hear that you are still disillusioned in the change over from stern drive diesel, to hydro jets, and the reason for this being the vessel will not slide on the water when turned hard to Port or Stbd, but still track as is desirable on a normal boat. We understand that you believe this feature, to be caused by the installed rudders on the hydro jets.
We are aware of the problems that were resolved when the installation was first done, namely on the hydraulic system where an additional ram was added, and also on the aluminium rudders which were swapped for stainless steel rudders, to achieve better turning circles, but not to necessarily try and make the boat loose (sic) traction and enter a sliding action.
We would like to mention, that the boat 'Okie-Dokie' was first designed as a 20+2 passenger ocean adventure boat for outboard motors, complete with necessary stability criteria for the required Class 1C survey, and able to operate in Cockburn's Sound choppy conditions.
Following high fuel costs and repairs, we were asked to fit diesel/stern drive propulsion system, which was done successfully, and without neither loosing any passengers nor loosing it's Class and stability criteria. The boat still performed its original hi-speed adventure tours with no significant loss.
The decision to change to Hydrojets, was to our understanding necessary to give Okie Dokie a better commercial exposure as the paying public prefer a ride in a 'Jet' boat.
In order to accommodate this request, the vessel was lengthened, the minimum possible, passenger numbers remain the same, and stability criteria are intact. The boat still performs its high-speed adventures, which was our main concerned, considering the original design of the vessel.
Following the very first sea trial, it was noticed that boat tracked correctly and would in fact not 'Slide' as you perhaps have been led to believe it should. Noticing your discontent and dissilussionment (sic), we offered to return the vessel to the stern drives, or to provide free of charge the lengthening and installation of the jets in the vessel, so you could still run your high-speed ocean adventures with jets as the market requested, and allow for a possible future power increase. You accepted the discount and have been running most of the season with only minor problems, and these problems associated with you trying to slide the boat, and not through normal designed operation.
We offered and conducted some R&D, to see if there was something possible that could be done to help achieve your new operational request, and in order to alleviate high stress and moments to the steering and reversing equipment associated with trying to slide the vessel, we have also offered a new nozzle and reversing deflector system being developed at present.
It appears that none of the things done, or offered are of any good to you, as your new final aim is to have a vessel which slides around, even though we have pointed out on many occasions, that it may be impossible to achieve both a boat designed for open ocean, and one that is designed for flat protected waters.
This leads us to the following conclusions:
Your operation is now mainly centered in achieving slides and doughnuts, similar to the Shot-over boats in NZ, or the harbour adventure cruises in Sydney, were both operations are run on flat water.
Okie Dokie is set up as a high-speed boat, with the CG aft, a deep V, and large chines. This configuration is used for riding through a chop, and to give good tracking control in a seaway.
The vessels used for the slides in calm waters have a CG very far forward, and a much more moderate deadrise, which would not make it possible to operate in choppy conditions but would help them slide around easily as tracking ability, would be very poor, and slamming would be very high.
What should be done
•We believe that Okie Dokie should be operated for ocean runs as it was designed to do and not as a 'hoon' type boat.
•Tight turns should be conducted without the use of the bucket as the vessel is not prone to sliding, and loading up the steering/bucket assembly beyond its designed capacity.
•An experiment could be conducted on Okie Dokie, by placing 3‑4 x 44 gallon drums full of water at the bow, and then to try and see if this may help the vessel slide by moving the CG forward.
•If this worked, some modifications to the boat may be necessary to move the CG permanently forward, with possible loss of seating, different trim and loss of performance for the high-speed operation in a choppy sea. Final assessment of what has been achieved would only be possible after sea-trials.
•If the changes were extensive to the CG, a reassessment of the stability may be required by DPI.
If the above was not acceptable to your operation, then we can only suggest or offer as follows:
•You purchase a different hull that is already in existence and does the type of things you want it to do. We cannot offer you such a hull so you will have to look at the Sydney boats.
•Following agreement on change over price, we return your boat to stern drives after your season ends.
•As you seem very dissatisfied with the jets, and keeping mentioning other brands, we would purchase the jets of you at an agreed price and you could then take the boat elsewhere to have a different type fitted.
We have asked again the factory if we can have the prototype nozzle until the new ones are developed. We are waiting on an answer to this. If you like we can try with water drums to put weight at the bow and move it around and see if it gives us an idea of what improvements one would have if the CG was moved forward.
We are happy to try this at a convenient time and would like to keep you as our customer, but you must believe that it is not because of the rudders alone causing your boat not to slide out as you would like. In our opinion people go on your boat to feel the speed, wind, and been out on a jet boat.
We hope you will give it some thought before making any decision on what you want to do.
We are sorry, and once again regret the disillusionment to your expectations.
Kind regards
Anthony Serrangeli (Projects manager)."
Mr Virtue said that he responded to this letter in writing, but I have been told that his response was marked "without prejudice" and it has not been produced in evidence. He said that it is his position and has always been his position that the vessel was to operate "like other jet boats do with those manoeuvres mentioned". Before his conversation with Tony on 23 February 2005 he was never told that the vessel would not perform slides, spins, fishtails and bucket stops because of the shape of its hull.

The removal of the jets

As I understand his evidence Mr Virtue says that the only work done on the OKIEDOKIE by the defendant after 24 February 2005 was to remove the plate inserted in the after section of the hull to flatten it, so as to return the hull to its former shape.
During March, April and in early May 2005 the plaintiff continued to operate the vessel notwithstanding that it was unable to slide spin or bucket stop as Mr Virtue had expected it would.
After consulting experts he said that the boat was taken out of the water on 9 May and the Castoldi jets were removed and replaced by Hamilton jets known as model 274s. This work was completed by 27 May 2005.

The performance of the vessel subsequently

Mr Virtue said that once the Hamilton jets had been fitted the vessel was able to perform slide outs, spins, fishtails and bucket stops.
A year or so later the boat was fitted with more powerful Hamilton jets known as model 291s but Mr Virtue said that these were only fitted to supply greater thrust and more reliability. He said that the manoeuvres which he had hoped for from the Castoldi jets, the slides spins fishtails and bucket stops, were all able to be performed when it was fitted with the smaller Hamilton jets in May 2005.

Brian Sims

Mr Brian Sims is a boat builder who was first employed by the defendant in 1995. He commenced as an aluminium fabricator working as a tradesman and said that after three or four years he became a leading hand, still on the tools, but also supervising work. He took instructions from Tony Serrangeli but was next in charge in the workshop having, at times, as many as 20 employees working under him.
Mr Sims has had experience as a racer of jet powered boats as well as having been involved in the construction of them.
He recalled the OKIEDOKIE being built in the year 2000 and worked on it. He also recalled being involved in the construction of The Pelican and "a boat from Venezuela" and the boat called the police boat.
Mr Sims described the police boat as "the closest boat" to the OKIEDOKIE being roughly of the same length. It was a little flatter in the V (he thought it was about 18 degrees) and was powered by two 300 horsepower diesels and Doen jets.
Mr Sims said that he was involved in sea trials on the police boat for about a week and a half. He said: "The boat did everything … it would slide, spin around …".
He also said:
"And that boat had a bow spit on it and an anchor attached to the front of it and you can do an emergency stop and dip the anchor in the water. It would stop that hard but everyone would have to hang on like, drop right back."
Mr Sims said the boat would stop in about two or three lengths. It had a top speed of 38 knots, he thought.
Mr Sims said that The Pelican was based on a charter boat design and was 14½ metres long weighing about 17 tonnes. It was fitted with Doen jets. He said that on sea trials:
"… that boat did the same thing, did a 180, which is – if you're doing a fishtail or slides, you can let it go to a certain way and turn opposite direction and it will do fishtails or if you kept it on full lock that's when you do a 180. It will turn around."
Mr Sims said that The Pelican would also do emergency stops "really quickly". It was a heavier boat but it would still stop within three boat lengths.

Mr Sims described The Venezuelan boat as a crew transport boat powered by 750 horsepower Volvo engines and Doen jets. It was about 16 metres long and was heavier than the OKIEDOKIE but lighter than The Pelican. Mr Sims said that he did the sea trials on it and again:
"It would do the same thing. It would slide. You could make it do a spin‑out. It was harder to make it do it but it would do it, and emergency stops were no problems."
He said that the boat would stop in three or four boat lengths, "enough to make you hang on".
After the OKIEDOKIE had been built for the plaintiff Mr Sims said that he saw Mr Virtue at the defendant's workshop often. He said that he would call in and they and Tony would sit and talk about the boats the defendant was building.
Mr Sims said that he recalled a meeting with Mr Virtue in mid 2004. He was in the office he shared with Tony who was present. He said:
"Jim was trying to get permission to operate his boat at Mandurah out of the new marina that was there and he wanted to operate a jet boat out of there."
Mr Sims said that Mr Virtue explained that in calm water he needed something that would give the passengers more of a thrill and that he recalled that in response to that Tony said "that jets were the way to go".
During this conversation Mr Sims said that he also recalled taking a photograph of the police boat from the wall of the office in which they were seated and showing it to Mr Virtue and explaining to him that the boat was very similar to the OKIEDOKIE. He said that he and Tony "explained what that boat had done and what his boat would do". Mr Virtue was told "that this boat could slide out, could wet everyone, could do emergency stops and that it was a great fun boat to drive."
Mr Sims also said that in the course of this conversation Marco would come into the office from time to time and that at one point there was specific discussion of what the OKIEDOKIE could do with jets. He was also asked and said:
"What did you say to him? - That jets in his boat would make it slide, spin. Fast enough to splash people and do all the stuff that a jet boat does."
Mr Sims said that Tony confirmed this.
At this meeting Tony or Marco mentioned Castoldi jets. Mr Sims said:
"Well, they had a pamphlet on the Castoldis and they were saying to him about the built‑in gearbox, how it could save space, carry more passengers and that they would look after him on the price."
He recalled also that there was a discussion about which model Castoldi jets should be fitted and that Tony suggested the 238 model but was going to check with the manufacturers in Italy and work out a price.
According to Mr Sims after this meeting there was further discussion between Tony and Marco in his presence during which Tony said that "this was going to be the making of Castoldi jets in WA".
Mr Sims said that after this there was another meeting between Mr Virtue, Tony and himself in the office he occupied. At it Tony informed Mr Virtue that the 236 was not suitable and that the 06 model Castoldi jet should be fitted and there was some technical discussion about gearing changes to be made to the engine. It was his recollection that Tony "quoted a price for the jet units of $22,500 each plus the cost of installation".
Mr Sims said there was also a discussion about the desirability of extending the boat by about 1 metre to enable it to take jet units. Either at that meeting or at a later one mention was also made of the need to purchase a set of drive shafts needed to connect the engines to the units.
When the boat was brought in to the defendant's workshop Mr Sims said that he did the fabrication necessary to extend the hull and, together with another employee, installed the jets. The work was finished by 1 October 2004 and the first sea trial was held. He went out on it and recalled that the boat didn't turn very well and it would not spin, fishtail or slide out. Nor would it stop "very well at all". It was Mr Sims's recollection that to bring the boat to a complete stop took some 20 boat lengths.
At the end of the trial Mr Sims recalled working on the steering system but at a further trial the next day he said that the turning circle of the boat was still "huge" and that it did not spin, slide, fishtail or do emergency stops.
Some days later Mr Sims said that he attended a meeting with Tony and Marco and a Mr George Szynaka whom he described as a surveyor for the Department of Transport. The performance of the OKIEDOKIE was discussed and Mr Szynaka suggested "cutting the keel off … like to free up the hull so that it had something less for it to grip". This was a reference to the cutting off of the metal strip running along the keel of the boat.
Mr Sims said that another meeting with Mr Szynaka (this time with Tony and himself) the former suggested cutting a section out of the back of the boat between the jets so as to flatten the keel at that point.
Mr Sims also recalled fitting the stainless steel rudders when they arrived from Italy and repairing them from time to time and fitting deflectors on to the sides of the buckets to assist in the manoeuvring of the boat in reverse.
He also said he worked on the steering and increasing the pressure on the hydraulic ram to the point when the ram burst. After that a second ram was installed by him.
Mr Sims described working on the boat to repair the steering and the buckets in the subsequent days and weeks. He also confirmed that he did the work involved in cutting a V section out of the hull between the jets as Mr Szynaka had suggested and later removing the flat plate which had been inserted. He said that he took his instructions from Tony for the most part and was involved in many discussions with him and Marco about improvements which might be made to the boat to increase its manoeuvrability.
Mr Sims recalled one particular discussion with Marco and Tony when the possibility of removing the jet units from the OKIEDOKIE was canvassed. He said that this took place within a week of the first sea trial. At this meeting Mr Sims said that he suggested that the jets be removed and explained why, saying:
"That it was better to give Jim his money back, take the jets off, rather than have a disaster happening in front of everyone in Fremantle. Jim is a well-known bloke down there and it was the first Castoldis that had been fitted into, you know, a boat that had that sort of exposure and it was not doing anyone any favours."
Mr Sims said that in response to this suggestion Marco was keen to remove the jets and that Tony also thought it was a good idea but nevertheless "keen to fix the problem".
The day after this meeting Mr Sims said that he recalled that Mr Virtue came in and met with Tony and Marco. He was also there but was in and out of the office. In the conversation which he heard Tony and Marco were saying to Mr Virtue: "Stick with us. We're going to throw in the extension for free". This was said by Marco.
Sometime later Mr Sims also recalled being present when discussions took place between Tony and Mr Virtue concerning a new prototype nozzle system for the Castoldi jets which was in the development stage and in which it was hoped could be fitted to the OKIEDOKIE to improve its manoeuvrability. These modified nozzles were not available, to Mr Sims' recollection before May 2005.
In about June 2005 Mr Sims said that he went out on the OKIEDOKIE. This was after the Hamilton jets had been fitted. On this occasion the boat did fishtails and slides and emergency stops. He was asked and said:
"What about the slide outs? Explain to us exactly what you could do with it? – At full speed, turn full lock and the boat would come around and then slide, sit back in the water and then take off back in the direction that you went.
What kind of angle could you achieve in terms of sliding? ‑ Well, 180. You could go back in the direction that you came.
All right. Now the emergency stops, how did they go? – Really well. It was enough that you had to hang on, brace yourself. The boat came to a screaming stop and spray would be spraying out of the front of the boat.
Can you estimate how many boat lengths it took for the boat to stop? – A couple."

Anthony Serrangeli

Mr Tony Serrangeli is responsible, as he put it, for "technical issues" in the conduct of the plaintiff's business while his brother handles the accounts.
He met Mr Virtue when the OKIEDOKIE was built but denied seeing much of him between then and mid 2004. He said that Mr Virtue only came into the defendant's premises "very occasionally".
There were no discussions with him about the performance of the vessels The Pelican, The Venezuelan and the police boat and the likely performance of the OKIEDOKIE in comparison to them once jets had been fitted.
He said that Mr Virtue may have seen The Venezuelan when it was being built, but it and the OKIEDOKIE were "completely different boats". The former was a boat designed to take crew out to an oil rig off the Venezuelan coast. According to Mr Serrangeli he had a sea trial report of The Venezuelan and "we did not even test bucket … stops. We were more concerned with the performance of the Volvo engines".
As far as The Pelican was concerned that vessel had a fly bridge and was a boat costing $800,000. It was completely different to the plaintiff's boat.
As to the police boat, Mr Tony Serrangeli said there was certainly no discussion with him about that boat when the fitting of the OKIEDOKIE with jets was being spoken about.
Mr Serrangeli recalled that in June 2004 Mr Virtue came to him and asked whether it was possible to fit jets to the OKIEDOKIE. He said that Mr Virtue told him that his business was not going well and he needed to change the image of it. He responded:
"If that's what you want to do, well sure, we can look at fitting water jets to your existing hull, you know, and using the existing power to your engines, basically. There's a possibility of either extending the hull or shortening it and losing passengers."
Mr Serrangeli said that Mr Virtue specifically asked whether it was possible to fit Castoldi water jets to the OKIEDOKIE saying that at that time he already knew that the defendant was a dealer in Castoldi jets. There was a discussion about which model jets to fit and Mr Virtue was given some brochures and "maybe some very rough pricing". There was no discussion about the performance of the boat once it was fitted with jets, save in relation to speed.
Mr Serrangeli was asked and said:
"Did he say anything about other characteristics of the boat that he wanted as a result of changing to jets? – No. There was no in‑depth discussion of any manoeuvrings or, you know, specific manoeuvrings or anything like that.
You say no in–depth discussion, was there any discussion? – Well, the biggest discussion was speed. It was imperative that we kept the 35 knots because without the 35 knots he would have a boat that was inoperable for his operation. His whole operation was based on speed runs into Cockburn Sound.
…
Apart from speed you mentioned the subject of manoeuvres, was there any discussion about any other aspect of the performance of the boat that he was wanting? – No. It was – the discussion was based on the fact that the vessel had to attain a certain speed because without that speed we were in trouble.
You're aware of Mr Virtue's allegation that he specifically asked whether the boat would be able – or he said that he wanted the boat to do certain manoeuvres? – Yes.
Do you recall any discussion of the sort that he talked about? – No, because if Mr Virtue had come to me and said 'I want a boat' as is now in his writ 'with a shotover type boat' I would have refused the sale.
Let's be specific. Did he mention anything to you in these discussions about wanting the boat to be able to do spins? – No. It was not a topic of discussion when we discussed the water jets, no.
Did he mention to you anything about wanting it to do fishtails? – No. Absolutely not.
Did he say anything to you about wanting it to do bucket stops? – We didn't discuss bucket stops, but it's normal for a boat with water jets to stop by use of a bucket. It's the only way you can stop. It has to stop by bucket."
Mr Serrangeli said that after this discussion Mr Virtue returned and said that he was ready to purchase jets and that he had been on the web sites and looked at certain jets and had made up his mind he wanted Castoldi jets. It was his wish to have the 238 model because of the lower cost, but Mr Serrangeli said that he told him he would have to check with the factory.
Mr Serrangeli denied that Mr Sims was involved in the discussions with Mr Virtue in June 2004. He said that if business was being discussed Mr Sims would not have been present. He said:
"He was never present. I've made it a point, he's only a subcontractor, not to be present at my business discussions."
Mr Serrangeli described Mr Sims as a fabricator and welder when working for the defendant. He was engaged on a subcontract basis and his duties were fabrication and the training of some apprentices. In this regard he had some responsibilities, but they "basically ended on fabrication". Mr Sims did not share an office with him, although he sometimes allowed him to use the office in order to order materials which he, Mr Serrangeli, had authorised.
Mr Sims may have been on the sea trials of The Pelican and the other boats mentioned but only as a fabricator ready to effect any repairs to work which had been done on the hull of the vessels.
Mr Serrangeli strongly denied that he would ever have told Mr Virtue that the OKIEDOKIE with jets fitted would be able to spin, slide and fishtail. He said:
"… every hull is a specific design, therefore the OKIEDOKIE … we know what we designed the vessel for and we remember what was on the tender for this vessel, which was directional stability, they had to have a machine gun on the front. They wanted the boat to track correctly. So it was designed with these parameters. Now, I could not risk as a builder to tell somebody that by fitting water jets to this boat the boat will lose all its characteristics. It's absurd. That's basically what it is. I can fit water jets to the vessel. I can fit stern drives. I can fit surface fusion propellers. We have prepared some general arrangements. But it's absurd to think that by putting a different form of propulsion system on a vessel it's going to completely change its characteristics and give a guarantee with it."
Mr Serrangeli had no recollection of Mr Virtue telling him of an opportunity to operate the OKIEDOKIE out of Mandurah in June of 2004 and of requiring more manoeuvrability in the boat so as to heighten the excitement of passengers riding on it. He did recall that he told Mr Virtue that the hull could be extended so that the vessel could still carry 20 passengers once the jets were fitted.
Mr Serrangeli checked with the Castoldi factory in Italy and received advice that the 06 model jets were appropriate. He had sent an email to Italy on 11 June 2004 reading as follows:
"Buongiorno a tutti.
The owner of the attached boat, our 10.9m RBB, would like to change from the Bravo legs to Jets. Below I have listed the hull data for the full displacement of approximately 7000kg, being existing hull and 22 passengers. He will be satisfied between 35‑40 knots at about half passenger load.
We think he will need 2 x 06, but there would be a lot of modifications necessary to fit them. He would prefer 2 x TD238 if they can achieve reasonable performance and of course there is less cost. Alternatively, perhaps we can use the "New" TD238 and close couple it to the Yanmar, which appears to give similar thrust as the 06, on your graphs.
WHAT IS YOUR OPINION ON THIS, and what performance can we expect with the various models? We are keen to introduce the New TD238, but need to know pricing structure, availability (he wants to convert the boat within a few months as it is the bad weather over here now).
It would be also very handy if I could get the CAD DRAWING of the new TD238 sent by email.
Saluti a tutti
Anthony.
EXISTING ENGINES – 2 x Yanmar 300HP/3800Rpm driving Bravo sterndrives. Current speed at full displacement is 35‑38kn.
Speed at working displacement 36-40 (12 pax)(Approximately 6Tonnes).
This is based on the sea/wind condition.
HULL data
LWL  9.00m
Breadth  3.10m
Draught  0.55m
Chine Beam  2.85m
Chine Length  9.30m
CX  0.100
Displacement   7.0t
LCG  4.50m
Half Angle of Entrance   27.00 deg
Deadrise Angle  20.0 deg
Wetted Hull Area  20.1m²
Wetted Transom Area   0.0m²."
Mr Serrangeli said he discussed this email with Mr Virtue before sending it and that it specifically refers to the requirement for speed because speed was the critical consideration. He said:
"… if the jets were not going to achieve that speed there was no sale."
A reply was received to this email on 16 June 2004. It read:
"Dear Mr. Anthony
We refer to your E-mail message of 11.06.04, here following (sic) there are the answers concerning the 10,9m. RBB.
The suitable water jet unit is a pair of "06" jet model.
In fact, the "Turbodrive 238" jet (old or new type) cannot achieve the necessary thrust at low speed to make your 7 tons boat planning (sic).
It is not a question of speed but of capability to give the sufficient thrust to push in planning the boat.
About the speed, we think that with No. 12 passengers, corresponding to 6 tons of weight, and with No. 2 x 300 HP engines we must go over 35 knots and achieve very goods speed also for 7 tons of full loaded weight.
On the contrary, with a pair of "Turbodrive 238" units you cannot plan at 7 tons.
Hoping to have cleared all your doubts, we remain,
Sincerely yours
CASTOLDI S.p.A."
After this exchange of correspondence Mr Serrangeli advised Mr Virtue that the 06 model Castoldi jet should be fitted and that is what was agreed.
After the jets had been installed Mr Serrangeli attended the sea trial on 1 October 2004. This was necessary because of the amount of work done to the vessel and the substantial modifications that had been made. During the trial he said that the engine didn't run too badly but that there was a steering problem turning to port. The boat went on to a plane and up to speed but there were problems steering when the engines were at full throttle. The problem was only steering to port, however. As far as Mr Serrangeli could recall, to starboard, "it looked quite normal".
As far as the operation of the buckets were concerned Mr Serrangeli said he had no reason to think they were not performing normally but no attempt was made to lower them when the boat was going at full speed.
Mr Serrangeli recalled the telephone conversation with Mr Virtue later that day and confirmed that Mr Virtue sounded "quite disillusioned with the vessel". He said that Mr Virtue told him that the boat was running slower and had a problem turning and he responded that these problems would be worked out.
The following day Mr Sims did some work on the steering and further work was done on subsequent days.
There may have been other problems on a few days after 2 October, but these were all attended to.
Mr Serrangeli recalled the letter of 11 October 2004 from Mr Virtue who handed it to him upon a visit to the defendant's premises. He said that it was quite obvious that the letter was a "fiction" and said that he was not "100 per cent sure" what the purpose of it was. He said that he spoke to Mr Virtue about the letter, but not about the statement contained in the second-last paragraph of it vis:
"Unfortunately though with the nature of my business West Coast Jet requires a unit that slips and slides across the ocean, fishtailing and letting go with tight turns."
Mr Serrangeli said that he had never discussed fishtailing and sliding with Mr Virtue and said that manoeuvres of that kind "was not an object of installing jets in his vessel".
However, Mr Serrangeli said that upon receiving this letter and Mr Virtue telling him that he was not happy with the work that had been done he offered him "a refund for his water jets". He said that he did this because Mr Virtue was an old customer and the jets were brand new and he was more than happy to give him his money back and on-sell them. Mr Serrangeli said that he told him:
"…
'Look, this boat is not designed for doing those fishtailing and letting go with tight turns. It's untested, unproven. I would never market such a vessel for that type of application. So you've got the wrong hull to do this type of work. You've got a boat with water jets as you specified to me originally, that you wanted a commercial type exposure of a boat with water jets and you've already got that and as you said, you see the boat does perform exactly as it should perform, because you've written it in your own letter above that. So that's option 1. Option 2, if you're really disillusioned and you would really like to try something else, I will return the vessel to the way you brought it in to my workshop and give you a refund on your jets. In either case, if I put your boat back to the original state you gave it to me, it's going to cost me about $10,000 to do, or, you can have the option of keeping your commercial exposure and I'll give you $10,000 off the bill that you owe me'.
So I gave him a very specific choice."

As to the claim for loss of income incurred in September 2004 again I do not consider that the plaintiff has established any loss.
Accordingly, I would assess damages under s 52 of the Trade Practices Act in a total sum of $40,293.80 calculated as follows:

Cost of Castoldi jets and fitting: $48,500.00

Couplings: $4,067.80

Driveshafts and plates: $3,000.00

Maintenance and repairs: $2,726.00

Subtotal: $58,293.80

Less value of Castoldi jets realised upon sale: $18,000.00

Total: $40,293.80

I will hear from counsel as to the appropriate orders to be made.