Hathersage Nominees Pty Ltd v Bond - [2010] WADC 158

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION: PERTH

CITATION: HATHERSAGE NOMINEES PTY LTD -v- BOND [2010] WADC 158

CORAM: GOETZE DCJ

HEARD: 8 SEPTEMBER 2010

DELIVERED : 15 OCTOBER 2010

FILE NO/S: APP 27 of 2010

BETWEEN: HATHERSAGE NOMINEES PTY LTD
Appellant (Claimant)
AND
NORMAN LESLIE BOND
First Respondent (First Defendant)
JOHN BEAMENT
Second Respondent (Second Defendant)

ON APPEAL FROM:
Jurisdiction              :  MAGISTRATES COURT OF WESTERN AUSTRALIA
Coram  :MAGISTRATE BOON
File No  :PE 1802 of 2009

Catchwords:

Appeal from Magistrates Court dismissing claim in conversion - Turns on own facts

Legislation:

Sale of Goods Act 1895 (WA)
Insurance Contracts Act 1984 (Cth)

Result:

Appeal dismissed

Representation:

Counsel:

Appellant (Claimant)  :        Dr P R MacMillan
First Respondent (First Defendant)         :        Mr D M McKenna
Second Respondent (Second Defendant)         :        Mr D M McKenna

Solicitors:

Appellant (Claimant)         :        Gibson Lyons
First Respondent (First Defendant)         :        Jarman McKenna
Second Respondent (Second Defendant)         :        Jarman McKenna

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

Fox v Percy (2003) 214 CLR 118
McKeown v Cavalier Yachts Pty Ltd (1988) 13 NSWLR 303
Parker v South Eastern Railway Co (1877) 2 CPD 416
Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 79 ALJR 129
Wilton v Farnworth (1948) 78 CLR 646

GOETZE DCJ:

Introduction

The appellant, Hathersage Nominees Pty Ltd, commenced proceedings in the Magistrates Court at Perth alleging that the respondents, Mr Norman Bond and Mr John Beament, converted to their own use a 930 Series 30 foot platform front belonging to Hathersage. Mr Bond is an insurance assessor. Mr Beament is a machinery wrecker. The claim was dismissed. This is an appeal against that decision.

Background evidence and trial

Hathersage Nominees Pty Ltd is the corporate trustee of a family trust which operates at different locations, including Kondut in the wheatbelt. It conducts its operations through Brian Robert Gould, and his wife Elizabeth Gould, who are directors and shareholders of Hathersage.
In September 1999, Hathersage, through Mr Gould, purchased a 1998 John Deere CTS II header, a 900 Series 30 foot platform front and a chaff spreader. These items were second hand and were purchased without inspection. They were immediately insured through CIC Insurance Limited, a subsidiary of HIH Insurance Limited.
Upon receipt of the 900 Series 30 foot platform front, Mr Gould determined that it was not suitable for his purposes and it was returned. He then purchased a brand new 930 Series 30 foot platform front by way of replacement.
Mr Gould neglected to cancel the insurance he had arranged on the original 900 Series platform front. He also neglected to insure the replacement 930 Series platform front.
A platform front is also known as a comb. It is attached to a header for use in harvesting. When a comb is joined to a header, the combination is commonly known as a harvester, as both pieces of machinery are required for harvesting.
From time to time, Mr Gould, on behalf of Hathersage, renewed the insurance on all three pieces of second hand items of equipment referred to above and he also varied the insured value of those pieces of equipment. This was because the value of such equipment varies depending upon the risk of fire during the different seasons of the year, when the equipment may or may not be in operation. The value also varies according to the risk of fire during harvest from year to year. The insurer therefore continued to insure under the belief that it was insuring the three pieces of second hand equipment as originally purchased and insured.
On 21 November 2000 at Kondut, a fire occurred when the header and the new replacement comb were being used in harvesting. This caused substantial damage to both pieces of equipment. A claim was then made against the insurance policy referring to the '1198 John Deer [sic] harvester'.
The claim was accepted by CIC through HIH, which appointed Mr Bond to act on the claim as its local agent. After some negotiation, HIH agreed to pay out the then fully insured value of the second hand equipment, being in the sum of $150,000, less a $100 excess.
It was a term of the insurance policy, that, upon any successful claim, salvage in the insured equipment would remain the property of the insurer. HIH accordingly provided a form of discharge to Mr Gould to execute on behalf of Hathersage in respect of the 'John Deere CTS II Harvester'. That form of discharge provided that upon settlement of the claim, salvage of the insured equipment 'shall remain the property of HIH'.
Mr Gould attempted, at first, to retain property in the insured equipment by varying the discharge in that he substituted Hathersage for HIH in the relevant clause in that discharge. However, he subsequently executed another discharge providing for the insured equipment to remain the property of HIH.
At about the same time, HIH was undergoing financial problems. Therefore, Mr Gould required the HIH settlement cheque to be cleared before he would release possession of the insured equipment. To that end, he provided a letter dated 13 June 2001 to Mr Bond. That letter, signed by Mr Gould and written on the letterhead of Hathersage, is in the following terms:
Hathersage Nominees will release the burnt header HOCT S2X67566/HOO9930r681743 once the insurance monies has [sic] been cleared by our bank Bankwest [sic].
The reference to two serial numbers following the words 'the burnt header' in the abovementioned correspondence is in fact very close to the actual serial numbers of each of the header and the replacement comb. In respect of the comb, the serial number detailed above contains an extra '9' and the 'r' has been substituted for 'R'. It therefore clearly relates specifically to the replacement comb, rather than the original second hand comb which has a completely different serial number.
Mr Bond delivered the cheque from HIH against receipt of the abovementioned discharge and letter. The cheque was subsequently cleared. Mr Bond was then instructed by HIH to take possession of the insured equipment as salvage, but he was not able to do so as it had been removed from where it had been stored away from the Hathersage property.
In due course, Mr Gould was arrested for allegedly stealing the comb. He was acquitted after trial. The police then released the comb.
Mr Bond, as agent for HIH, then sought tenders to purchase the fire damaged equipment and ultimately, Mr Beament was successful in that tendering process. He purchased the replacement comb. Hence the claim conversion against both Mr Bond and Mr Beament.

The trial issues and findings

The primary issue at trial was whether Mr Gould had claimed on the insurance policy in respect of the fire damage to the new replacement comb. He said that he did not and that he was only claiming for damage to the header. The learned magistrate found that he did claim for the new replacement comb, as well as the header.
In making this finding, the learned magistrate found Mr Gould to be an unreliable witness. She had ample reason for doing so, including the fact that Mr Gould had previously been involved in litigation in which the facts were very similar to the present case, such that her Honour found that Mr Gould:
would have been well aware that some years before a court had decided that a harvester and comb form part of the unit and that the expectation of both insurer and insured was that they are regarded as a unit – AB 60.
Throughout its dealings with Mr Gould, HIH believed that it had continued to receive premiums in respect of the original second hand comb and further, it was not at any time told that the comb involved in the fire was the new replacement comb and not the original second hand comb.
At trial, the evidence of the HIH witness, Ms D Ashworth, was to the effect that the new replacement comb was not insured as notification of the fact of replacement had not been given by Hathersage.
On this basis, Hathersage submitted that the insurance claim by Mr Gould, on behalf of Hathersage, could not have included the new replacement comb.
In this respect, her Honour found:
It more likely than not that in making this claim Mr Gould on behalf of Hathersage Nominees Pty Ltd deliberately concealed from the insurer and its agent that the comb that was damaged in the fire and that was inspected by Mr Bond was not the comb that was insured. He knew, or ought to have known, that the insurer would not have paid the amount that it did under the insurance contract if it had known that the comb was different from the comb it had insured. I accept that it is likely that Mr Gould simply forgot to insure the new front (comb). However, when it came to making this claim, he deliberately concealed that fact. His behaviour throughout was, in my view, quite deceptive – AB 60.
Further, her Honour found that:
Mr Gould on behalf of Hathersage did misrepresent the nature of the equipment insured when he made the insurance claim and negotiated the payment. … Mr Gould on behalf of Hathersage did misrepresent to the insurer the property that was to be salvaged when he signed the discharge – AB 61.
The terminology of the relevant part of the discharge is fully set out at [37] below.
The learned magistrate also found that:
By signing the right of salvage in that property over to the insurer in exchange for the cheque, Hathersage relinquished its right of ownership in the salvage to the insurer. Even if I am wrong on that last point, the findings of fact in relation to the other issues lead to a conclusion that Hathersage, because of the actions of its director, is now estopped from claiming the value of the comb. I find that Mr Bond and Mr Beament did not convert the comb to their own use … – AB 61.
The HIH employee, Ms Ashworth, also gave evidence that Mr Bond was at all material times acting on behalf of HIH – AB 276. Hathersage, through Mr Gould, well knew that Mr Bond was acting as the representative of the insurer – AB 239. Her Honour so found at AB 60. That finding is not challenged in this appeal.

The appeal

By r 50(1) of the District Court Rules, the appeal is 'by way of a reconsideration of the evidence before' her Honour. In Seaman, Civil Procedure Western Australia, vol 2 at 16.307.10, this is said 'to be clearly by way of rehearing', as to which see Fox v Percy (2003) 214 CLR 118 [23] and [25].
There are two grounds of appeal relating to her Honour's findings as to the ownership of the comb upon the claim being accepted and paid out and her finding of estoppel against Hathersage.

Ground 1

The first ground of appeal reads as follows:
The Magistrate erred in fact and law in finding that ownership of the Comb the subject of the proceedings had been transferred from the Appellant/Claimant to the First Defendant (First Respondent's) principal in that:
(a)the finding was not made on any clear legal basis;
(b)the finding was made in the circumstances;
(i)where there was no delivery of the Comb to the First Respondent (First Defendant's) principal;
(ii)there was no finding that the Appellant/Claimant intended to transfer ownership of the Comb to the First Respondent (First Defendant's) principal;
(iii)the discharge document relied upon did not refer to the Comb.
As noted above, the learned magistrate found that HIH at all material times believed that the insured equipment was the equipment damaged in the fire. HIH was not aware of any replacement of the original second hand comb by the new comb. It accepted the claim as made for the harvester, which comprised the header and comb. Once the value of the insured equipment had been agreed between the parties, Mr Gould signed the discharge providing for salvage in the insured equipment to remain the property of HIH. This was in accordance with the general conditions of the policy applicable to all sections of the policy under par 7(c)(i) as set out at p 37 of the policy – AB 152.
Further, by his letter dated 13 June 2001 referring in almost exactly correct detail to the serial numbers of the header and the new replacement comb respectively, Mr Gould, on behalf of Hathersage, confirmed that Hathersage would release the insured equipment to HIH once the insurance monies had been cleared. The monies were cleared and upon such clearance, the clear intent of the letter was that Hathersage would 'release' possession of the insured equipment to HIH, with ownership having already been relinquished pursuant to the signed discharge.
There was therefore a clear legal basis on which her Honour was entitled to find that ownership of the new replacement comb transferred to HIH upon execution of the discharge. This follows her findings that:
(1)Mr Gould insured the original second hand comb but, he forgot to insure the new replacement comb – AB 60.
(2)The new replacement comb was damaged in the fire –AB 60.
(3)Mr Gould made a claim for the header and the new replacement comb which he knew to have been fire damaged. He deliberately concealed the fact that the damaged comb was not the insured comb – AB 60.
(4)He further knew that the damaged header and comb 'form part of the unit and that the expectation of both insurer and insured was that they are regarded as a unit' – AB 60.
(5)Mr Gould further continued his deception to HIH when he signed the discharge – AB 61. That discharge related to the fire damaged header and (new replacement) comb.
(6)By his execution of the discharge on behalf of Hathersage, Hathersage relinquished its right to the 'property' or ownership in the salvage to the insurer – AB 61.
The discharge operated as a contract between the parties by which they agreed to resolve the claim which was made in respect of the fire damaged header and the comb. Ordinarily, the intent of that discharge was that the settlement cheque was exchanged for ownership and possession of the insured equipment, being the header and comb. It was clear to Hathersage, through Mr Gould, that the new replacement comb was part of that discharge as set out above. This is confirmed by the fact that Mr Gould referred to the comb by almost the exact serial number in his letter dated 13 June 2001, by which Mr Gould sought to vary the usual understanding of the effect of signing the discharge, and to not 'release' possession of the fire damaged insured equipment until HIH's cheque had been cleared. This release could only have related to possession, but not to ownership. It is inconceivable that Mr Bond, on behalf of HIH, would deliver the HIH cheque without HIH obtaining ownership of the fire damaged equipment.
The finding of learned magistrate that by its execution of the discharge, Hathersage 'relinquished its right of ownership to the insurer' is also challenged on the basis that the comb was not in fact delivered to HIH.
This follows upon the learned magistrate's finding that:
Mr Gould falsified the discharge relating to the claimant with the intention of deceiving Mr Bond and the insurer. It is clear that he never had any intention of handing over the comb. He admits that – AB 60.
This finding however relates only to an intention to not deliver possession of the comb to HIH; not to ownership. On the facts, Hathersage through Mr Gould did not deliver possession of the insured equipment to HIH against execution of the discharge.
The submission from Hathersage was that derivative ownership of personal property, by the transfer of ownership, involves a voluntary and consensual dealing, unless it takes place by operation of law ‑ McKeown v Cavalier Yachts Pty Ltd (1988) 13 NSWLR 303 at 309 ‑ 310. It was argued that what is required is delivery, either actual or constructive, of the personal property in question, by the transferor to the transferee, and an intention on the part of the transferor to transfer ownership to the transferee and an intention on the part of the transferee to receive ownership – Fisher: Commercial and Personal Property Ltd (Butterworths 1997) at [4.21].
The problem with this submission however is that, at face value, the discharge executed by Mr Gould on behalf of Hathersage specifically provides that:
It is agreed that the salvage in the abovementioned vehicle shall remain the property of HIH Insurance Limited and that as settlement is made on a total loss basis, insurance cover on the abovementioned vehicle will now cease.
The discharge also warrants that the insured property was not encumbered in favour of any other party. That warranty was sought, no doubt, so as to ensure that ownership and possession of the equipment being the subject of the claim could properly pass encumbrance free to HIH and become its property over which it had title and a right to possession with that title.
The fact that Mr Gould, on behalf of Hathersage, misrepresented to HIH, through Mr Bond, the property to be salvaged when he signed the discharge does not mean that the discharge does not operate to transfer ownership in the property which was put forward as insured property. It is clear that the claim was in respect of the fire damaged header and comb. That claim was accepted by HIH. The discharge operated to settle the claim for the property specified therein, being the fire damaged property in which the salvage was to remain with HIH.
The discharge speaks for itself notwithstanding any intention Mr Gould may have had of deceiving Mr Bond and HIH that he would deliver possession of the equipment to HIH upon clearance of its cheque. Certainly ownership passed upon execution of the discharge and delivery of the settlement cheque. Further, upon clearance of that cheque, possession of the insured equipment also passed by way of constructive delivery to HIH as the letter signifies an intention by Hathersage to so deliver upon clearance and the evidence was that HIH, through Mr Bond, so intended to receive ownership and delivery by the discharge and letter respectively.
In Toll (FGCT) Pty Ltd vAlphapharm Pty Ltd (2004) 79 ALJR 129 [42], the High Court referred to Parker v South Eastern Railway Co (1877) 2 CPD 416 (421) and said that in an ordinary case, where an action is brought on a written agreement which has been signed by the defendant, the agreement is proved by merely proving the signature, and, in the absence of fraud, it is wholly immaterial that the defendant has not read the agreement and does not know its contents.
The High Court in Toll at [43] further relied on Wilton v Farnworth (1948) 78 CLR 646 (649) where Latham CJ said the following:
In the absence of fraud or some other of the special circumstances of the character mentioned, a man cannot escape the consequences of signing a document by saying, and proving, that he did not understand it. Unless he was prepared to take the chance of being bound by the terms of the document, whatever they might be, it was for him to protect himself by abstaining from signing the document until he understood it and was satisfied with it. Any weakening of these principles would make chaos of every-day business transactions.
The High Court in Toll at [45] also held that a party who signs a document, which is known and intended to affect legal relations, conveys a representation to a reasonable reader of the document that the person who signs has either read and approved the contents of the document or is willing to take the chance of being bound by those contents, whatever they might be.
The fact that Mr Gould was himself deceptive when he signed the discharge and letter does not operate so as to render meaningless that discharge and letter. He cannot take advantage of his own wrongdoing. It is a requirement of everyday commercial life that people should be bound by their signed documents. The execution of the discharge in this case was a standard procedure in insurance matters of this kind, as demonstrated by the two previous discharge documents in existence. Their purpose was to create legal relations between the insurer and the insured for the purpose of resolving claims against policies of insurance.

The discharge operated as a matter of law, if not intention, to relinquish ownership in the salvaged equipment to HIH. So too, the letter dated 13 June 2001, operated as a matter of law, if not intention, such that the insured equipment was constructively released to HIH by Hathersage upon HIH's cheque being cleared.
The final point complained of in ground 1 is that the discharge document did not refer to the comb. Literally speaking, that is true. However, it is standard procedure to refer to a header and comb as a harvester. It was the unit as a whole that was burnt and for which the claim was made and discharged as set out above.
To this end, the discharge document referred to the 'John Deere CTS II harvester'. The evidence before her Honour was that the word 'harvester' was common usage for a header and comb when joined together.
Trial counsel for Hathersage accepted that a header and comb 'might generally be regarded as a combine harvester' – AB 182 and 183. Mr Gould also accepted that proposition – AB 217. He knew that the insured items were the original second hand header, comb and spreader ‑ AB 224 and AB 229. He claimed in respect of the fire damaged header and replacement comb and he 'obviously' presented HIH's cheque in respect of that fire damaged replacement comb to his bank for collection – AB 243.
If there was any doubt about what equipment was the subject of the claim when Mr Gould executed the discharge, such doubt was removed once regard is paid to Mr Gould's reference in his letter dated 13 June 2001 detailing two serial numbers for the header and the new replacement comb respectively. This is so notwithstanding that each of those serial numbers contain minor errors in them. It is certainly not arguable that the second serial number relating to the new replacement comb could relate to the original second hand comb. Indeed, the evidence is that Mr Gould asked his wife to deliberately make the errors in the serial numbers when typing that letter – AB 61 and 62.
It also should be noted, that, Mr Gould claimed at trial that he prepared his letter dated 13 June 2001 under duress. That finding was strongly rejected by the learned magistrate and is not challenged in this appeal.

Ground 2

The second ground of appeal reads as follows:
2.The Magistrate erred in fact and law in finding an estoppel against the Appellant (Claimant) arose in that:
(a)there was no pleading of an estoppel;
(b)the Defendant did not argue an estoppel;
(c)the Plaintiff was not given an opportunity to meet the estoppels either in evidence or in submission.
At the trial, counsel for Mr Bond and Mr Beament referred to 'estoppel issues' in his opening. This was done in a preliminary submission, prior to counsel for Hathersage opening the case. The facts giving rise to the estoppel were recited by counsel for Mr Bond and Mr Beament in his opening before the evidence began and then, after the evidence, including evidence about matters of estoppel, counsel for Mr Bond and Mr Beament again referred to the conduct giving rise to the estoppel. This was picked up by counsel for Hathersage in his responding submissions. The transcript reads as follows:
McKENNA, Mr: Yes, just briefly, ma'am. Ma'am, firstly, in the matter of the estoppel argument I opened in relation to that. I led evidence in relation to it. There was no objection at any stage. If my friend's asking for a formal amendment to plead it, then I would seek leave to do that but, in my submission, it would be unnecessary, but if he's going to insist, then I will seek your leave to do that. Clearly the case has been run on that basis. Evidence has been elicited from witnesses and he's cross‑examined on that.
HER HONOUR: Yes, Mr Lyons, in relation to that?
LYONS, Mr: Your Honour, I simply raise it. My friend seems to be – he did mention the question of estoppel at the outset in his opening. I simply point out that it's not a matter that has been pleaded either in the original statement of claim, didn't find its way into his listing conference memorandum, the first one or the amended one, and it's a matter for him as to whether he wishes to amend, but I simply make that point.
HER HONOUR: Were you opposing any amendment? Are you saying I should not take that into account, because my understanding was that was partly the basis of the defence?
LYONS, MR: Yes, if what my friend is saying is that the question of estoppel arises because of the conduct of Mr Gould in failing to amend the policy to reflect the replacement or if he's saying that the document signed which is exhibit 11, I think – if that constitutes the estoppel, then that doesn't take me by surprise and I wouldn't be opposing any – I wouldn't require an amendment in that regard, but I'm not sure exactly or precisely how the estoppel arises – how it's said the estoppel arises.
HER HONOUR: Mr McKenna?
McKENNA, MR: I thought that I specified that in the opening submissions. The estoppel arises, I said, in two ways: firstly, in allowing the insurer to believe that what continued to be insured was a 900 series comb in that the plaintiff was paying a premium for doing so and one would expect that if he no longer had that comb, it would tell the insurer and Mr Gould admitted that nobody did tell the insurer, but, secondly, on the basis that at no time was the insurer told that the comb involved in the fire was not the comb covered by the policy and in that regard I said I rely upon the meeting between Mr Bond and Mr Michael Gould at the farm where it's clear from the evidence of Mr Bond that he was not told by Mr Michael Gould that the comb involved in the fire was not insured property or was not the same as that included on the schedule. That's where the representations giving rise to the estoppel arise.
HER HONOUR: Thank you. Is that a difficulty for you, Mr Lyons?
LYONS, MR: No, it isn't, your Honour. There's no additional evidence that I would have called in relation to those matters.
HER HONOUR: No. The view I will take then is that there is authority to the effect that the Magistrates Court is not a court of pleadings.
LYONS, MR: Yes.
HER HONOUR: It was set out on that basis right at the beginning of the trial. I don't think it catches you by surprise and in the interests of justice ‑ ‑ ‑
LYONS, MR: I accept that, your Honour.
HER HONOUR: - - - then I consider that that is an issue that this court should take account. Thank you – AB 340 – 341.
Experienced counsel for Hathersage appeared at the trial. He expressly stated that an amendment to the pleadings was not required to deal with the estoppel issue. He accepted the issue had been put against Hathersage and that he did not require to deal with it by evidence. He merely wanted to know how the estoppel arose. Counsel for Mr Bond and Mr Beament then gave his explanation in the two ways referred to above.
In submissions, Dr MacMillan, who was counsel for Hathersage on appeal but not at the trial, argued that there was no reliance by Mr Bond upon any misrepresentation by Hathersage. He argued that Mr Bond removed the comb on the basis that it was the property of HIH, and not of Hathersage; there was no question of reliance by Mr Bond on any earlier misrepresentation which may or may not have been made by Mr Gould.
Dr MacMillan relied upon the evidence of Mr Bond at the trial when he was asked what happened to the comb following the criminal trial in which Mr Gould had been charged and acquitted of stealing the comb. Mr Bond responded:
I contacted the prosecutor. I think it was Mr Jeff Scholz, from memory, at that stage and I was more concerned with the determination as to who owned the front and he said there was no determination made by the officiating judge. I relayed that to the claims manager at HIH, Allianz, and I was asked to get salvage tenders on the remains which I did, presented those to the company and was provided with instruction to dispose of to the highest tender – AB 292.
Dr MacMillan therefore submitted that at the time Mr Bond took possession of the comb, he did not know who owned it. Dr MacMillan relied upon the abovementioned passage to support this proposition. However, such passage is equivocal. As Mr McKenna, counsel for Mr Bond and Mr Beament, indicated, if Mr Bond had been able to obtain a determination of ownership of the comb from the officiating judge at trial, then, he could have used that to assist him when seeking to obtain possession of the comb from Mr Gould.
Hathersage, through Mr Gould, made the claim and allowed the insurer to believe that it was still insuring the original second hand comb which was the subject of the insurance policy. Further, Hathersage, through Mr Gould, did not at any time tell the insurer that the comb involved in the fire was not the comb covered by that policy. These were the matters relied upon by the insurer by way of estoppel. Mr Bond was at all material times aware that the discharge had been signed by Mr Gould on behalf of Hathersage and it was Mr Bond who requested the letter of release dated 13 June 2001. Mr Bond was entitled to rely on all these matters in arranging for tenders to purchase the comb and the header and when accepting the best tender for the comb and header. I have already noted at [25] above that Mr Bond's role as agent for HIH is not challenged in this appeal.
Appeal ground 2 has not been made out.

Mr Beament

There is no separately pleaded ground of appeal as to why the judgment in favour of Mr Beament should be set aside.
Mr Beament was the successful tenderer. Mr Bond authorised Beament to collect the salvaged equipment, but when he went to do so, parts of it were missing. The police then became involved and Mr Gould was arrested for having allegedly stolen the subject property. He was found not guilty. Upon the release of that property after trial, further tenders were called for and again Mr Beament was the successful tenderer and the salvaged equipment was sold to him by HIH through Mr Bond.
Tenders were called for the purchase of the comb in a market overt. Such a market is defined in the Shorter Oxford English Dictionary as offering goods for sale in an open and legally constituted market. There is no evidence that Mr Beament bought the comb other than in an open and legally constituted market on good faith and without notice of any defect or want of title on the part of HIH. Accordingly, pursuant to s 22 of the Sale of Goods Act 1895, he acquired a good title to the comb. Section 22 is in the following terms:
Where goods are sold in market overt, according to the usage of the market, the buyer acquires a good title to the goods, provided he buys them in good faith, and without notice of any defect or want of title on the part of the seller.

Conclusion

In the circumstances, neither ground of appeal is made out. Even if I am wrong on appeal ground 1, the rejection of appeal ground 2 dictates that the appeal against Mr Bond must fail.
There is no separate ground of appeal against Mr Beament.
This appeal must therefore be dismissed.
Finally, I note that by s 13 of the Insurance Contracts Act 1984 (Cth), Hathersage, through Mr Gould, was required to act in the utmost good faith towards HIH. Mr Gould did not do so. However, this was not argued before me and I therefore make nothing of it in these reasons.

Notice of variation

The claim by Hathersage against each of Mr Bond and Mr Beament was dismissed by the learned magistrate. It is submitted that the claim against Mr Bond should have been struck out, rather than dismissed. I am not persuaded to do so and do not propose to vary her Honour's orders dismissing the claim.