Hung's (1985) Ltd v D & J Fowler Ltd

Hung's (1985) Ltd (the appellant) appealed to the Supreme Court of South Australia against a decision of the District Court. The dispute concerned a contract for the sale of goods, specifically a consignment of frozen prawns. The appellant alleged that the prawns supplied by the respondent, D & J Fowler Ltd, were not of merchantable quality and were unfit for their intended purpose, leading to a claim for damages.

The primary legal issues before the Supreme Court were whether the prawns were of merchantable quality and fit for the purpose for which they were sold, and if not, what damages were recoverable by the appellant. The court was required to consider the implications of the implied conditions as to merchantable quality and fitness for purpose under the Sale of Goods Act 1896 (SA), and whether the appellant had accepted the goods despite the alleged defects.

The court found that the evidence did not establish that the prawns were not of merchantable quality or unfit for their intended purpose at the time of sale. It was noted that the prawns were sold as "frozen prawns" and were indeed frozen. Any deterioration in quality was found to have occurred after the sale and delivery, due to the appellant's own handling and storage practices. The court applied the principles that the burden of proof lay with the appellant to demonstrate a breach of the implied conditions, and that the implied conditions relate to the quality and fitness of the goods at the time of sale, not thereafter.

The appeal was dismissed, and the appellant was ordered to pay the respondent's costs.