| JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA LOCATION : PERTH CITATION : HYNE -v- GERRARD NOMINEES PTY LTD & ANOR [2003] WADC 284 CORAM : FRENCH DCJ HEARD : 3 SEPTEMBER 2003 DELIVERED : 18 DECEMBER 2003 FILE NO/S : CIV 4236 of 1998 BETWEEN : KEIGHTLEY DAVID HYNE Plaintiff
AND
GERRARD NOMINEES PTY LTD (ACN 062 93 189)
First Defendant
JOHN WILLIAM GERRARD
Second Defendant
Catchwords: Contract - Breach of express and implied terms - Reconditioned truck motor - Turns on own facts
Legislation: Nil
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Result:
Plaintiff's action dismissed Representation:
Counsel:
Plaintiff : Mr R M J Lombardi
First Defendant : Mr M T S Rennie
Second Defendant : Mr M T S Rennie
Solicitors:
Plaintiff : MacKinlays
First Defendant : Michael Rennie
Second Defendant : Michael Rennie
Case(s) referred to in judgment(s):
Nil
Case(s) also cited:
Nil
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1 FRENCH DCJ: In August 1997 the plaintiff purchased a reconditioned truck motor from the first defendant trading as Diesel Repair Re-Power WA. The second defendant is a diesel mechanic and a director of the first defendant. The engine was installed in the plaintiff's 1982 International 1900 truck. The plaintiff claims that the engine was not a fully or properly reconditioned engine and was not fit for its purpose as a truck engine. He claims the engine was faulty and had to be returned for repairs on numerous occasions and ultimately required a further full reconditioning by another diesel mechanic in September 1998.
2 The defendant denies that the engine required numerous repairs as claimed and denies that it was not a fully reconditioned engine.
Pleadings and issues 3 In the statement of claim the plaintiff alleges that the terms of the contract both express and implied included: · That the motor had been fully reconditioned which involved the motor being fully stripped and all worn parts replaced to ensure that they complied with the manufacturer's specifications in the relevant service manual for Caterpillar 3208 engines.
· That the motor would be fit for the purpose of use as a truck engine.
· That the installation would take 4.5 working days.
· The motor would be guaranteed to be fit for that purpose and not require major mechanical attention for 200,000 kilometres or two years.
· That the motor was a truck motor which had only travelled 40,000 kilometres.
· That the motor would include a reconditioned clutch and gearbox and a reconditioned or new turbo charger.
4 The plaintiff alleges that each of these terms has been breached by the defendants as follows: · The motor was not delivered on time but 9.5 days late.
·
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· The motor was not fit for the purpose of a truck engine as it required numerous repairs including repairs to fuel lines, oil lines, clutch and oil cooler and ultimately the motor had to be stripped and reconditioned again.
· The starter motor failed and the exhaust system had to be replaced as the existing system was not appropriate for a turbo motor.
· The motor supplied was an industrial motor that had operated in a static mode for a period in excess of 40,000 kilometres running time rather than a motor used in a vehicle for 40,000 kilometres.
· The motor was not fully reconditioned so that the parts complied with manufacturer's specifications.
5 As a result of the breaches referred to above the plaintiff claims to have suffered loss and damage for the cost of repairs and reconditioning and for the loss of income due to late delivery in August 1997 (this was not included in par 27 of the statement of claim but no point was taken by the defendants in relation to this pleading issue) and for loss of income while the truck was being repaired in August and September 1998. 6 In addition to the action for breach of contract the statement of claim also claims damages for misrepresentations pursuant to the provisions of the Trade Practices Act and the Fair Trading Act. 7 The defendants deny that it was a term of the contract or that any representations were made that the motor would be reconditioned by a specified date. The defendants deny that it was a term of the contract that the motor was a motor that had been in a truck that had only travelled 40,000 kilometres. The defendants deny that the motor was not fit for the purpose of a truck engine although it is admitted that there was a warranty for 20,000 kilometres or two years. The defendants deny that the motor was not a fully reconditioned motor and deny that it required major mechanical repairs or a further reconditioning. The amended defence claims that if the motor consumed excess oil or required repairs as is alleged this was caused by the plaintiff's failure to take timely remedial action, to install new thermostats and to change the engine oil and filters at appropriate intervals. Alternatively, the defence states that if there was a major defect in the reconditioned motor it was an implied term of the contract that the first defendant would be given the opportunity to carry
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out any repairs. In breach of that term the plaintiff failed to give the first defendant that opportunity and arranged for an alternative diesel mechanic to carry out the repairs.
The issues 8 In opening the plaintiff stated that the plaintiff's complaints regarding the truck engine are summarised in the 14 points listed in the particulars to par 21 of the statement of claim. The plaintiff relies on the faults listed in those particulars to establish that the engine was not fully reconditioned and also claimed that it was those faults that necessitated a number of repairs including the complete reconditioning of the engine. The claim in particular (j), namely that the gearbox was not stripped or reconditioned was abandoned during the course of the trial. The defence fundamentally takes issue with all of the complaints or alleged faults comprised in the 14 points in the particulars to par 21. The evidence was presented and the case essentially conducted on that basis. Although the plaintiff supplied a detailed statement of issues and facts that does not reflect the way the case was conducted at the trial. I consider that the issues for determination are as follows: · Did the truck engine provided by the first defendant contain any of the defects listed in the 14 points?
· If so, do these defects amounts to a failure to provide a fully or properly reconditioned truck motor?
· Was it a term of the contract that the installation of the motor will take 4.5 working days?
· Was the truck using excess oil, and if so, was that as a result of the defects in the truck engine and/or did the plaintiff fail to change the oil within the appropriate periods?
· If there were defects in the truck motor was it a term of the contract that the second defendant would have the opportunity to carry out those repairs and was it denied that opportunity? There is no real issue that there was a term of the contract that the engine was a truck engine with an odometer reading of 40,000 kilometres as the plaintiff did not adduce any evidence to support that.
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The evidence
9 At the relevant time the plaintiff was a self-employed truck driver. He was the owner of a 1986 eight and a half tonne truck with a six metre tray. It had a crane behind the cab and was used for general cargo. When the engine in that truck failed in 1997 the plaintiff was referred to the second defendant. In August 1997 the plaintiff and the first defendant entered into a contract for the supply and installation of a 3208 Caterpillar engine plus a reconditioned clutch and a gearbox for the sum of $18,000. A deposit of $3,000 was paid and the truck was delivered to the workshop on 15 August 1997. The quotation supplied to the plaintiff stated: "To supply and install a fully reconditioned 3208 turbo Caterpillar engine with reconditioned 10103A Spicer overdrive gearbox with new 14 inch Spicer pull clutch. Quoted price $18,000. Warranty two years or 20,000 kilometres." The plaintiff stated that he had been told by the second defendant that the installation would be completed in 4.5 days. However he was not able to take delivery until 29 August 1997 some nine days later. On that date the balance of $15,000 was paid to the first defendant. The plaintiff said that this resulted in a loss of income for nine and a half days and advised that his loss was at the rate of $40 per hour. 10 The plaintiff said he had problems with the truck within days of picking it up. He said that there was a fuel leak on the right side of the engine. He returned the truck to the defendant's workshop and waited for two to three hours for this to be repaired. In the second week the clutch was not engaging fully. He stated that he took it back to the workshop where it was repaired for half a day. He stated that the next problem occurred when he was driving the truck in Rockingham. He heard a noise and saw that the oil cooler had blown off the side of the motor. He said that he had to shut the truck down and wait for it to be towed to the defendant's workshop. The oil cooler was repaired there but he stated that the next day oil was still leaking. He therefore took the truck to another diesel mechanic, Robert Richards, who told him that the wrong oil filter and bolts had been installed. 11 Approximately five to six months after the delivery of the truck the plaintiff said that he noticed that the truck was using an excessive amount of oil. He took it back to the defendants and the second defendant told him that the oil rings had not bedded in properly. He said that the oil was changed and the second defendant used a "wet stacking" procedure on the engine. He described this as putting a tin can over the exhaust and
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running the engine for an hour. The second defendant said that new thermostats were required so the following Saturday he took it back to the workshop for two thermostats to be installed. He stated that the second defendant said that he was too busy to do it that day and that he would have to do it himself. He stated that as a result of that that was the last time that he went back to the defendant. The following month he took the truck to Mr Richards, trading under the name of Go Power. The plaintiff said that he went there because he was advised that this was an authorised Caterpillar diesel repairer. He stated that the first time he went to see Mr Richards was because of concerns regarding the excessive oil consumption. He said that in addition the engine would shut down and stop for no reason. He also could not steer it because the steering was no good at low revs. The plaintiff tendered a number of invoices rendered to him from Go Power for repairs to the truck engine. These included invoices for a variety of repairs including an invoice in the sum of $20,535 for the further reconditioning of the truck engine. There was an invoice for repairs to the electric fan from the radiator and machining of an inductor on 5 November 1999 and an invoice for repairs to a pulley on the front of the engine. In addition the plaintiff also tendered invoices for fees from a finance broker for arranging for finance for the further reconditioning of the engine. 12 The plaintiff was cross-examined in relation to answers that had been given to interrogatories delivered by the defendants. In answers to interrogatories numbered 7 and 8 the plaintiff had advised that the oil was changed on or about 11 May 1998 and on or about 11 September 1998. On cross-examination the plaintiff stated that he took the truck to Mr Richards at Go Power to have the oil changed. When it was suggested to the plaintiff that those dates indicated that he had failed to change the oil at the recommended 10,000 kilometre intervals he said that he had changed the oil himself in addition to taking the truck to Mr Richards. Initially he stated that he had purchased the oil from Mr Richards but when it was suggested to him that there were not invoices from Mr Richards to support that he then said that he bought oil from other outlets prior to taking the truck to Mr Richards. The plaintiff's response to this line of cross-examination and his reactive attempts to "patch up" a hole that he thought he had fallen into was quite transparent. In the circumstances and in view of my findings below I do not consider that the issue as to when and if the oil was changed at the appropriate intervals is significant in this case. However, the plaintiff's responses in cross-examination confirmed my view that he was generally an unreliable witness. Some of his claims against the defendants are obviously
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exaggerated or have been made with scant regard for accuracy. The statement of claim seeks damages for delay in completing the reconditioning of the engine until 29 August 1997. When faced with the fact that the balance of payment was actually banked by the defendants on 27 August the plaintiff was forced to concede that he may have taken delivery of the truck on or about 26 August 1997. When questioned in relation to an invoice presented to the Court for repairs to the drive shaft carried out by Mr Richards in October 1998 the plaintiff appeared not to be aware that that was not included in his claim against the defendants. While I accept that the plaintiff is trying to recall details that occurred almost five years ago he should have familiarised himself with the relevant details. He continually made accusations of a generalised and somewhat exaggerated nature but when pressed on cross-examination he would be forced to concede a degree of inaccuracy. For example, he agreed in cross-examination that he had not spoken to the second defendant in relation to problems of oil consumption prior to June 1998 but dismissed that on the basis that he would have received a negative reaction from the second defendant if he had mentioned it. He complained of faults with the clutch but on further probing in cross-examination conceded that adjustments to the clutch were really part of the routine maintenance on the truck. 13 Mr Robert Richards is a qualified and experienced diesel mechanic who trades under the name of Go Power Diesel Services in Lansdale. He has experience with working with Caterpillar engines and at the relevant time was an authorised Caterpillar dealer. He was the mechanic that carried out repairs and eventually a complete reconditioning of the engine for the plaintiff in 1998. He also prepared a report on the condition of the engine dated 15 December 2001 and tendered as an exhibit in these proceedings. Mr Richards gave evidence that the term "reconditioned engine" means an engine that has been brought back to as new condition. Parts that can be re-used are stripped back and re-used and worn parts replaced. He stated that the plaintiff first came to see him regarding the truck in November 1997 when he was advised by the plaintiff that oil was leaking from the engine cooler and that the clutch was not working correctly. He stated that he examined the oil cooler and determined that grade 5 bolts rather than grade 8 bolts had been used. He stated that in his opinion that meant that the oil filter could not be tightened correctly. He also considered that the engine had been fitted with oil filters suitable for a non-turbo engine instead of a turbo engine. He said that that would mean that the flow of oil would be impeded increasing the oil pressure.
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He repaired the cooler and replaced the oil filters and suggested that the plaintiff record the oil used over an extended period. 14 He stated that he was not contacted by the plaintiff until 26 May 1998 in relation to the excessive use of oil and a number of other problems. These problems included a difficulty with power steering, an engine that was hard to start in the morning and that would shut down while it was being driven. 15 Mr Richards stated that the plaintiff brought the truck back to him on 27 August 1998 again complaining about excessive oil use. At that stage Mr Richards removed the cylinder head and carried out complete inspection of the engine. As a result of that inspection Mr Richards determined that the engine had not been fully reconditioned in accordance with Caterpillar specifications and using Caterpillar recommended parts. His findings are listed in detail in his report dated 15 December 2001. For purposes of assessment the cylinder block and cylinder heads, Conrods and crankshaft were sent to the firm of R M Moore & Sons for further inspection. Mr Richards stated that the report from R M Moore & Sons confirmed that some of the parts were not within Caterpillar specifications and also states that the number 7 and 8 Conrods on the crankshaft did not have a full face contact because of excessive grinding of the crankshaft. He noted that the R M Moore & Sons report indicated that this was not the cause of any of the present problems but could cause premature failure of the crankshaft in the future. 16 The turbo for the engine was sent to a specialised firm for examination. The report from Turbo Tech indicated that the turbo had been damaged by the injection of a bolt from the exhaust side of the turbo charger. Mr Richards' report indicates that the bolt would have been caused by incorrect assembly and by being left behind in the exhaust manifold. The report from Turbo Tech also indicated that the turbines in the turbo charger had been scoured by contaminants from the engine lubrication system. 17 In Mr Richards' report it was stated that after various parts had been returned from the machine shops the engine was reassembled using necessary parts and procedures outlined in the Caterpillar manual. The engine was then dyno tested and run in. It was considered that the engine performed in accordance with its rated horsepower and that the oil consumption was normal. Mr Richards stated that the reconditioning of the engine took approximately seven days and the plaintiff was charged the sum of $20,535 for the reconditioning.
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18 Mr Richards was cross-examined extensively in relation to some of the details in his report. He agreed that the oil should be changed in a diesel engine at intervals of every 10,000 kilometres and that if it is not changed the oil can become contaminated and can cause damage. He also agreed that the engine should run at a temperature between 85 and 92 degrees. He agreed that the thermostats regulate the temperature and it is not uncommon for them to fail. He also agreed that excess oil consumption can be due to contamination of the oil or cold running of the engine although he appeared to contradict that in re-examination. Mr Richard agreed that contaminated oil could cause excessive wear to some of the components of the turbo charger. He agreed that if the oil had not been changed for as long as 28,000 kilometres that could cause scouring to the pistons.
19 During the course of cross-examination Mr Richards was asked to again measure the exhaust valve stems that he had stated were not in accordance with the recommended specifications. As a result of his re-measurement in court he conceded that the measurement of the stems was in fact within the specifications in the Caterpillar guidelines. 20 In relation to his evidence that the incorrect piston rings were used he conceded that it was his opinion that keystone piston rings should be used because there were oil consumption problems. He did concede that if it were not for the oil consumption problems the piston and ring combination provided by the defendants was perfectly adequate for an engine producing about 200 horsepower. When asked if it was appropriate to install those pistons he pointed out that it was difficult for him to comment as he was not aware of the circumstances when the engine was being rebuilt by the defendant. However, he made it clear that as far as his workshop procedures are concerned he would prefer to use the keystone piston rings. Mr Richards also conceded that the ring gap was within specifications. 21 Mr Richards stated that a diesel engine that had been used for stationary purposes could be used as a truck engine with appropriate modifications. He also agreed that the original motor that had been in the plaintiff's truck would have had a horsepower of between 120-130. He stated that although there were restrictions on the amount of horsepower in an engine that could be installed in a truck in relation to the drive line it was not inappropriate to install a 200 horsepower engine. He stated that the engine that he reconditioned had a 250 horsepower although after the reconditioning he said that he bought the fuel back down a little bit so that the turbo charger could work more. He stated that the plaintiff had
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advised him that the engine that was reconditioned by the defendants was to a 250 horsepower specification. 22 Mr Richard stated that a couple of months after he reconditioned the engine for the plaintiff the plaintiff returned complaining about lack of power and on inspection it was apparent that that was caused by too much back pressure in the exhaust system. Mr Richards denied that that was caused by increasing the horsepower to 250 but did agree that there had not been any complaints about high exhaust back pressure prior to that time. 23 Mr Richards stated that he did not inspect the gearbox and at no stage did he advise the plaintiff either in his report or otherwise that the gearbox had not been reconditioned. The plaintiff subsequently advised that that particular in par 21 of the statement of claim would not be pursued. Mr Richards stated that a repair was carried out on the gearbox in May 1999 by replacing an "O" ring but there was no indication that the gearbox had not been reconditioned. 24 Mr Richards stated that the problems in the clutch were due to loose springs in the clutch plate but that otherwise the clutch did not appear worn. When it was suggested to him that the manner in which the clutch is used could result in a constant need to adjust the clutch he advised that he was only required to repair the truck but had no idea how it was driven. He also conceded that a single clutch plate was perfectly adequate for the truck and it was a matter of personal choice that he installed a twin clutch plate. 25 Mr Richards was cross-examined on the issue of the level of oil consumption indicated in the log completed by the plaintiff. He concluded that a close examination of the data on the graph revealed that the oil consumption during the period the log was used was only just inside the investigative range. He agreed that if the oil had not been changed immediately prior to the preparation of the log the results may be misleading. He agreed that oil consumption after an oil change is not evenly spread. He stated that after an oil change the vehicle would not consume that much oil until approximately 6,000 kilometres. He agreed that it was possible that if the oil had not been changed immediately prior to the preparation of the log then that may mean that the level of oil consumption indicated in the log would be misleading and it may be that the level would be outside the investigative range. Mr Richards stated that even if the engine had not been using excess oil that that would not change his opinion that the engine had not been properly reconditioned as
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his inspection of the engine revealed that it had not been reconditioned in accordance with Caterpillar specifications and recommended component parts. 26 Mr Stewart Davis is a machine shop manager at R M Moore & Sons, a diesel engine reconditioning firm. The crankshaft and the cylinder heads were sent to R M Moore & Sons for inspection. Mr Davis stated that the crankshaft inspection was a standard inspection performed at their workshop. Mr Davis said that the examination indicated that the crankshaft was in good condition with the exception of the area at number 7 and 8 Conrods where there was not a full thrust face contact on the crankshaft. He described this area as having been ground away and stated that this would have occurred when the crankshaft was manufactured. Although he stated that this defect in the crankshaft had not caused a problem in the engine his company could not guarantee it in the future. In cross-examination he stated that this could create a dangerous situation as it could lead to the area becoming badly worn. However he did concede that the stresses between the Conrod and the thrust wall are not high. He also noted that the crankshaft was not a genuine Caterpillar crankshaft and was of the opinion that anyone reconditioning the engine would have noticed this defect in the course of assembling the engine. He stated that he had not seen a crankshaft in that condition before. 27 In relation to the cylinder head Mr Davis stated that the inspection did not reveal any significant problems. There was some scuffing and wear apparent on the face of the heads there but there was nothing that was inconsistent with normal usage. Although he stated that remedial work would involve fitting 16 valve guides and replacing 8 exhaust valve and valve seat inserts it did not necessarily mean that they were not within serviceable limits. He also stated that on any reassembly of the engine the piston rings would be replaced and if that was to be done it would be normal practice to hone the bores. 28 Mr John Gerrard (the second defendant) is an experienced diesel mechanic who operates a business through the company Gerrard Nominees (first defendant) trading under the name of Diesel Repair Re-power WA. He has been a diesel mechanic for approximately 40 years with 18 years experience in re-powering or reconditioning truck engines. Mr Gerrard stated that the plaintiff came into his workshop and chose the 3280 Caterpillar turbo engine from amongst a number of partly reconditioned engines available and accepted a quote for the supply of the engine together with a Spicer gearbox and associated components and a
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new clutch. Mr Gerrard stated that at no stage did he agree to install the engine within four and a half days or within any other period. He pointed out that that was not possible as the engine reconditioning was not completed at that time and more parts had to be obtained. He stated that he and his assistants worked into the night and on weekends to complete the reconditioning and the installation in the plaintiff's truck within nine and a half days. He said that the Caterpillar engine came from a drilling rig and his records indicated that there was an odometer reading in relation to the engine of 47,712 kilometres. 29 Mr Gerrard explained in some detail what was involved in the reconditioning of the engine. He had started reconditioning the engine some months before August 1997. A new crankshaft was installed and that had been obtained from Kitsons Diesel Services and he produced an invoice for that crankshaft. The engine had been purchased second hand and was then stripped down and checked and various parts sent off to Stewart's Automotive Reconditioning for reconditioning. There the block was bored and sleeved. New pistons, valves and thermostats were installed. A reconditioned water pump and reconditioned turbo charge was also obtained. The turbo charge core was reconditioned by a firm called Turbo Tech. The valves in the engine were quite serviceable and did not require replacement. The fuel pump was overhauled by a firm called A1 Diesel Injections. The turbo injector was serviced by West Track. 30 Mr Gerrard explained that the engine was built to a 200 horsepower calibration to suit the drive line, chassis rails and braking system of the truck. He considered that 250 horsepower was too much power for that truck. He stated that in his opinion the engine was reconditioned to Caterpillar specifications. The engine was installed in the truck by Robert Collins, Mr Gerrard's son-in-law who is a long term employee for the first defendant. 31 After the plaintiff collected the truck from Mr Gerrard on or about 26 August 1997 the next he heard from the plaintiff was in October 1997 when he received a phone call from him to advise the truck was at Rockingham and that there was leaking oil from the cooler. Mr Gerrard arranged for a tow truck to collect the truck and deliver it to his workshop. After an inspection it was discovered that there was a split "O" ring in the oil cooler and that was replaced. Mr Gerrard said that at no stage had the oil cooler "blown off" the side of the engine.
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32 Mr Gerrard stated that he was next contacted by the plaintiff in June 1998 and advised that the starter motor had failed. The starter motor had been supplied to Mr Gerrard for use in the reconditioned engine by another firm but Mr Gerrard paid the plaintiff the sum of $480 being the cost of a new starter motor.
33 He had no further contact from the plaintiff until mid July 1998 when the plaintiff rang to say that the truck was using too much oil. He was advised to bring the truck into the workshop for an inspection. Mr Gerrard stated that after everything was checked there did not appear to be any obvious cause for excess oil consumption. A wet stacking procedure was employed to run up the temperature of the engine in order to bed in the piston rings. This was actually carried out by Robert Collins but Mr Gerrard was there checking on the procedure. At the time of the wet stacking procedure the oil and oil filters were changed. Despite the wet stacking procedure the temperature of the engine only reached 63 Celsius. In Mr Gerrard's opinion the engine had "glazed up" because it had been running cold. It was considered that there may be a faulty thermostat at fault and replacement thermostats were ordered and supplied to the plaintiff on the following Saturday. Mr Gerrard explained that these thermostats were not installed at his workshop as the plaintiff was not able to wait for the engine to cool to allow for safe installation. 34 Early in August 1998 the plaintiff contacted Mr Gerrard to advise that an adjuster on the compressor belt had broken. As Mr Gerrard was working in the workshop on his own that day he sent a pulley and bracket by courier to the plaintiff. At that time he was advised by the plaintiff that at that stage the truck was not using excessive oil. 35 Mr Gerrard then heard from the plaintiff shortly after when he was advised that the truck was at Mr Richards' Go Power workshop where it had been dismantled. The plaintiff stated that he was told in what he described as "no uncertain terms" that the valves "were all buggered". When Mr Gerrard went down to the workshop with Robert Collins he stated that he overheard Mr Richards tell Robert Collins that the valves were not as bad as he originally thought they were and that he had made a rash statement. Mr Gerrard said that the block had been stripped and all the parts were on the floor inside the truck. Mr Gerrard stated that in his opinion the pistons and bores were glazed. He said that there were two thermostats lying on the floor and that they had jammed open but the two new thermostats that he had supplied to the plaintiff in July were still sitting up on the truck dashboard in their packets. Mr Gerrard stated that after he had checked everything out he told the plaintiff that he was
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prepared to take everything back to his workshop and repair it under warranty free of charge. Mr Gerrard advised that he thought that this was the appropriate action to take although he did not accept that there was anything significantly wrong with the engine. Mr Gerrard stated that he considered that the only thing that was necessary was to reassemble the motor, put in new rings and bearings and install new thermostats. In his opinion this could have been done without disassembling the engine. He estimated that the total cost would be in the vicinity of $5,500. This would involve honing the bores, replacing the pistons with new rings and as the engine had been disassembled, putting in new bearings and new gaskets, reassembling it and installing it in the truck. The new rings and gaskets and bearings would be supplied simply because that was an appropriate thing to do since the engine was already disassembled. It did not mean that the existing parts were unserviceable. However the plaintiff did not accept Mr Gerrard's offer and instead advised him "that he would see him in court". 36 In cross-examination Mr Gerrard's evidence that the engine had been properly reconditioned by him was challenged in some detail. The following matters were then put to Mr Gerrard and he responded as follows: · It was suggested that the plaintiff brought the truck back to the workshop on three occasions from 1 September 1997 to 15 September 1997. Mr Gerrard denied that and said that the truck was only brought back on one occasion and that is on 28 October 1997 when there was oil leaking from the oil cooler. He denied that the plaintiff brought back the truck on other occasions in that period. On that occasion the oil cooler repair involved replacing an inexpensive "O" ring and re-bolting the oil cooler.
· The truck was only brought in on one occasion in July 1988, in relation to excessive oil consumption and the oil and oil filters were changed and the wet stacking procedure was used to bed in the rings. New thermostats were ordered and supplied to the plaintiff to regulate the temperate of the engine.
· Mr Gerrard agrees that the reports from R M Moore & Sons stated that there was excessive grinding on the thrust face contact of the crankshaft but he did not
·
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· consider that that was a fault or problem as the grinding is not on the facing but on the balance or the opposite side of the facing.
· The clutch was a new clutch and was suitable for its purpose. He disagreed with Mr Richards that a double plate clutch was necessary and stated that in his experience and opinion a 14 inch single bore clutch plate is appropriate for an eight tonne truck and in fact can be used in 10 and 12 tonne trucks. Mr Gerrard suggested that if there needed to be adjustments to the clutch plate it was probably due to the plaintiff failing to operate the clutch properly.
· Mr Gerrard stated that the turbo was assembled correctly. He disputes that a bolt was left in the turbine and that that bolt caused damage. He stated that if the bolt had been loose in the exhaust manifold it would have totally disintegrated the turbo. Mr Gerrard suggested that a report from Turbo Tech that had been supplied to Mr Richards indicated that the turbo was malfunctioning because of contamination.
· Mr Gerrard disputed that the exhaust system was not suitable. He stated that the exhaust system he installed was suitable for a 200 horsepower engine and that was tested on the day the wet stacking procedure was conducted on the engine in July 1998. He stated that the six kilo pascal measurement was below the recommended maximum pressure of 10 kilo pascals. Mr Gerrard referred to a handwritten note (Exhibit 22) which records the pressure at 6 kilo pascals. Mr Gerrard suggested that if Mr Richards had measured the back pressure at 14 kilo pascals that could be due to the increase in horsepower to 250 horsepower.
· Mr Gerrard disputed that there was anything faulty in the fuel injection pump and stated that the plaintiff had not complained to him about low power in the engine.
· Mr Gerrard disputes that there was any fault in the power steering pump and stated that when he inspected the engine at Mr Richards' workshop in August the powering
·
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· steering pump had not been opened up for examination. He stated that when he installed the power steering pump it had been dismantled and checked and was in good working order.
· Mr Gerrard disputed that the incorrect solenoid was installed and stated that a 12 volt battery would not open a 24 volt solenoid. Mr Gerrard stated that the truck left his workshop with a 12 volt solenoid installed and stated that if that had not been the case the engine would not have been able to be started. Mr Gerrard stated that in his opinion Mr Richards had either made a mistake or given an incorrect account of his findings because he was unable to find any other explanation for defects in the fuel pump.
· Mr Gerrard disagrees that the cross hatching on the bores was not within specification as the bores were honed by another company to computerised Caterpillar specifications. Mr Gerrard suggested that there may have been an error in Mr Richards' measurements of the honing.
· Mr Gerrard stated that the pistons that he used were suitable for a 200 horsepower engine. The keystone pistons and rings are required for engines of 300 or 350 horsepower.
· Mr Gerrard stated that he does not and has never used grade 5 bolts as he carries nothing but grade 8 bolts in his workshop.
· Mr Gerrard concedes that he did not use a Caterpillar electric pump but installed a standard pump that was appropriate and suitable for the purpose.
· Mr Gerrard disagreed with Mr Richards' comments in his report that the measurements on the exhaust valve stems and the guides and the piston compression rings and oil control rings were outside specifications. He stated that in his opinion Mr Gerrard had made a mistake with the micrometer when taking the measurements.
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37 Mr Gerrard disagreed with the suggestion that the two year or 20,000 kilometre warranty that he had given with the engine was an absolute guarantee that there would be no repairs required or work that would have to be done on the engine in that period. He stated that it was not unusual for repairs and adjustments to be made to components of a truck engine and that that frequently happened with reconditioned as well as new truck engines. He stated that at all times he was prepared to inspect the truck engine and carry out whatever repairs were required and supply whatever replacement parts were necessary. He stated that he was prepared to do that even if the fault was not due to any failure on his part to recondition the engine in a proper and workmanlike manner. He stated that in his opinion if there was any faults in the engine it was caused through the engine being run cold after it had been installed but nonetheless he was prepared to undertake any repairs and reassemble the engine as a "common courtesy" because it was within the warranty period.
38 Mr Darren Chandler is a mechanic who was working as an apprentice mechanic at the defendants' workshop in 1997. He recalls assisting Mr Robert Collins with repairs to the air cooler from the engine. He stated that the complaint was of an oil leak from the oil cooler and after the oil cooler had been unbolted a split "O" ring was discovered and replaced. Mr Chandler stated that the oil cooler was not hanging off the engine and in fact that was one of the reasons why they could not understand why there was an oil leak. He stated that grade 8 bolts were used to reattach the oil cooler. Mr Chandler also confirmed Mr Gerrard's evidence that on the occasion when the plaintiff called in to have thermostats replaced on his truck they were handed to him to replace himself because the engine on the truck was hot and they could not be replaced until the engine had cooled down. 39 Mr Robert Collins is a qualified diesel mechanic who was working at the defendant's workshop at the relevant time. He is Mr Gerrard's son-in-law and has been working with him for 13 years. He stated that in his experience it is not the practice to give clients time frames in relation to re-powers of trucks because of the amount of work involved and delays due to unavailability of parts. He confirmed Mr Gerrard's evidence that only grade 8 bolts are used in the workshop. He recalled assisting in the installation of the engine in the truck and taking it for a test run. He also confirmed Mr Gerrard's evidence that he did not see the plaintiff in relation to problems with the truck from October in 1997 when there was a leak from the oil cooler until July the following year when he attended in relation to excessive oil consumption. He described the wet stacking procedure that was employed at that time and the problem with the cold
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running of the engine and the suspicion that the thermostats may be faulty. He confirmed the evidence of Mr Gerrard and Mr Chandler that the thermostats were given to the plaintiff because of the need to allow the engine to cool. He confirmed that the thermostats were both in their packets on the dashboard of the truck when he attended at Mr Richards' workshop with Mr Gerrard in August 1998. He also stated that on his inspection of the dismantled engine the pistons and rings were glazed. Otherwise, in his opinion, there was nothing wrong with those components. 40 Mr Robin Stewart has been the Manager of Stewart's Automotive Engine Reconditioning Co for 33 years. He confirmed that the company did machine work on a Caterpillar 3208 block for the defendants in 1997 by reference to an invoice supplied to the defendants. He stated that the honing on the cylinders is done by computer according to Caterpillar specifications. However, he stated that the Caterpillar specification is in accordance with general industry standard. He explained that the honing used to be done by hand but is now done by machine. He stated that he has never had a complaint in relation to the honing angle on a Caterpillar engine. 41 Mr William Apgar is a civil and mechanical engineer with experience in forensic and consulting engineering. For the purposes of giving evidence he had been provided with Mr Davis' report on the crankshaft together with the Caterpillar guidelines for reusable parts. Mr Apgar stated that in his opinion the crankshaft used in construction of the engine by the defendants was quite serviceable. He explained that the faces that are ground away are not thrust faces but are side wall surfaces. The function of the side wall is to create a continuous surface with the grinding radius. However, the actual surface area required is very small because the stress is not high at that point. Because there is no significant stress on that surface it does not present a problem. He stated that it could not be described as a damaged surface as it had been ground away in the manufacturing process. He differentiated that, with the illustration in the Caterpillar journal where the crankshaft had chips and obvious impact damage indicating possible sub-surface cracks. He explained that it was the possibility of sub-surface cracks that would be of concern in relation to the future use of the crankshaft. I am satisfied, on the basis of Mr Apgar's evidence, that there was no defect in the crankshaft that would have any operational effect on the engine. 42 Mr Kevin Burrows is a diesel mechanic with extensive experience in consulting and investigative work in relation to engine failures and has
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experience in giving expert testimony in litigation. He has worked for and operated his own engine reconditioning business for some years. He was asked to inspect engine parts provided for him at Mr Richards' workshop. He was also present in court during the evidence of other witnesses for the purposes of being able to provide appropriate expert testimony and commentary on that evidence to the Court. 43 Mr Burrows stated that he was provided with a box of parts by Mr Richards and these included pistons with rings assembled, various bearings, Conrod and main bearings, a crankshaft, a power steering pump, clutch plate and pressure plate and exhaust valves. He confirmed that pistons and valves that had been referred to during the course of evidence in court were the same as the ones he had inspected at Mr Richards' workshop. 44 Mr Burrows inspected and measured the valves and on his observation the valves were exactly standard and in accordance with the Caterpillar specifications for new valves. He stated that the Caterpillar Service Manual 328 was applicable for both turbo charged and naturally aspirated engines and the basic engine components for a turbo charged engine are the same. The valve sizes are the same and he said that is very common on most engines. Mr Burrows took some of the piston rings from Mr Richards' workshop so that he could look at them under magnification. He stated that this revealed that the oil ring and second compression ring were in quite good condition. He stated that the top ring would be replaced but that was a matter of course if the engine was pulled apart and was going to be honed. He said it was standard procedure when the engine was pulled apart that a new set of rings would be installed. However, if that was not possible the existing rings would be serviceable. 45 Mr Burrows explained that he was not able to inspect the turbo charger or the fuel injector pump as they had been reconditioned and reassembled back on the truck. However, he was able to inspect the power steering pump and he confirmed Mr Gerrard's evidence that the pump did not look as if it had been pulled apart for inspection as there were still mud and grime around the bolts that hold the end cap of the pump on. In his opinion there had never been a spanner put on the bolts to take them off for any inspection. 46 Mr Burrows was not able to inspect the engine block but he had the opportunity of seeing the report from R M Moore & Sons. In his opinion the engine block was a reusable unit and although there was some scoring
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of the bores they could be re-honed. He stated that whenever an engine is stripped down it was standard procedure to hone the bores. 47 Mr Burrows stated that the pistons were in good condition and appeared to be near new and consistent with approximately 12 months wear. He also confirmed Mr Gerrard's evidence that the pistons and rings used by Mr Gerrard were appropriate for their purpose and it was not necessary for keystone piston rings to be installed. He commented that it was not uncommon for engine manufacturers to change parts and to upgrade them. In his opinion the fact that the piston rings are keystone or straight makes no difference. By way of example he explained that one large engine manufacturer, De Troit, have changed recommended piston rings from keystone to straight on a number of occasions. 48 Mr Burrows inspection of the clutch plate and clutch pressure plate indicated that it was in quite good condition with the only problem being some springs that were loose in their housings. He stated that this was not an unusual problem and arose as a result of usage. He confirmed Mr Gerrard's evidence that it was not unusual for clutches to require adjustments depending on how they are used and the nature of the wear. 49 In cross-examination Mr Burrows conceded that he did not have an opportunity of inspecting the engine when it was stripped down and disassembled for inspection at Mr Richard's workshop in August 1998. However, Mr Burrows said that he was still in a position to give expert opinion evidence on the state of the engine because he had been able to inspect some of the parts and had also read the reports that had been prepared and had an opportunity of hearing the evidence in court. Mr Burrows explained that it was very important in a diesel engine that the engine is run at a constant temperature as this assists in the detonation and burning of fuel. If the engine is running cold and is carrying a light load and not being run hard this results in incomplete burning of the diesel fuel that can lead to glazing on the bores and some scouring or scuffing and minor seizures of some parts. While Mr Burrows considered that it is most likely that any oil contamination was caused by running the engine at a low temperature and under a light load the problem would be exacerbated if the oil was not changed according to the recommended 10,000 kilometre interval. In Mr Burrows' opinion based on the evidence that was available to him the reconditioning of the engine performed by the defendants was carried out in a satisfactory manner and in accordance with the usual industry practices. He stated that it was not unusual for some parts to fail in reconditioned engines as well as in new engines. He confirmed Mr Gerrard's evidence that if the bores in the engine were
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glazed and that there was an oil consumption problem that could have been rectified by removing the cylinder heads and taking out the pistons and rods and re-honing the cylinder bores. This would not have required the complete reconditioning of the engine and could have been completed at a cost of approximately $2,5000.
Findings 50 I am not satisfied that the plaintiff has established that there was any significant fault or defect in the truck engine. Nor was it established that any faults or excessive wear was due to a failure to provide a properly reconditioned engine. The only particulars in the 14 listed in par 21 that were present were either not proved to be caused by the defendants' ((e) – excess wear of the turbo) or was not a "defect" and would have no operational effect on the engine. ((d) – No 7 & 8 Conrods not having full face contact on the crankshaft). 51 The faults that did occur, namely the broken "O" ring in the oil cooler, the faulty starter motor and the adjustor bracket were all promptly repaired or replaced by the defendants. They did not indicate any faulty workmanship but were just routine repairs that will often arise in any engine whether reconditioned or new. Although Mr Richards appeared to be doing his best to give an accurate account of his inspection of the condition of the engine he did not impress me as a reliable witness in the circumstances. A detailed cross-examination revealed that he had made some errors in his measurement of some of the component parts. His preference for the exclusive use of authorised Caterpillar parts was to a large extent influenced by the fact that he was an authorised Caterpillar dealer and there was some advantage in him to recommend and use Caterpillar parts. In some cases the difference between parts or methods employed by Mr Richards and Mr Gerrard came down to a matter of personal preference and did not indicate that the parts or method adopted by Mr Gerrard were unserviceable or unsuitable. 52 Mr Gerrard impressed me as an honest and reliable witness. He had obviously gone to a considerable amount of trouble to ensure that he had a detailed recall of the events surrounding the reconditioning of the engine and his dealings with the plaintiff. In many important areas his evidence was corroborated or supported by the evidence of his employees or the evidence of the expert witnesses Mr Apgar and Mr Burrows. He described his work on the engine and his dealings with the plaintiff in a calm and methodical manner. On every occasion that the plaintiff contacted Mr Gerrard in relation to a problem with the truck engine he
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took appropriate action in accordance with the terms of the warranty. I am satisfied that the plaintiff has exaggerated the problems that he had with the truck engine. I do not accept that he took the truck back to the defendants as often as he stated and prefer the evidence of Mr Gerrard that the truck was brought back only on the occasions he described. If he was experiencing further problems with the truck he should have taken it back to the defendants for inspection and repair if necessary. His failure to take the defendant's advice that the engine was running at too low a temperature undoubtedly contributed to any problems he may have been experiencing in relation to oil consumption and poor performance of the engine. 53 The issue of whether the truck was using excessive amounts of lubricating oil and the cause of that is difficult to determine on the evidence. Although the oil consumption log indicated that the oil consumption was in the investigative range Mr Richards did concede that there may have been a miscalculation in that determination. It is also the case that a failure to change the oil prior to completing the log may have affected the results of the log. In any event I am not satisfied that if excess oil was being used that was due to any defects in the reconditioning of the truck engine. On the basis of the evidence of Mr Gerrard and Mr Burrows I find that it is more than likely that the cause of any problems in the engine was the result of running at a low temperature and with a light load resulting in incomplete fuel consumption causing the glazing on the engine components, contamination in the oil and an increase in oil consumption. Although a failure to change the oil may have contributed to that it seems that it is unlikely that that would have been a causative factor by itself. 54 I am not satisfied that it was a term of the contract that the installation of the engine would take 4.5 working days. On the basis of the evidence of Mr Gerrard and Mr Collins I find that there was no specified time for completion of the reconditioning of the engine other than that it would be completed as soon as was reasonably possible. Although the statement of claim included an allegation that it was a term of the contract that the engine had been used in a truck with an odometer reading of 40,000 kilometres there was no evidence to support that and even if there had been I accept the evidence of Mr Gerrard that there was no representation made to that effect nor was it a term of the contract. 55 On my findings the defendants supplied to the plaintiff a properly reconditioned truck engine with a reconditioned clutch and gearbox in compliance with the terms of the contract. The workmanship and parts
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supplied were accompanied by a two year warranty. If defects appeared or repairs were required within that period that arose as a result of poor workmanship or failure of parts supplied then the defendants would be under an obligation to replace the parts or conduct those repairs. I am satisfied that at all relevant times the defendants were prepared to repair the truck or make good any defects. Mr Gerrard was even prepared to reassemble the engine in August 1998 despite the fact that he did not consider that he was responsible. The plaintiff was simply not prepared to consider that and instead chose to have the engine reassembled and further reconditioned by Mr Richards. There is no basis in which he can claim the costs of that reconditioning from the defendants. The plaintiff's claim is dismissed. |