Ironwill Earthmoving Pty Ltd v Allbut - [2020] SADC 172

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
IRONWILL EARTHMOVING PTY LTD v ALLBUT & ANOR
[2020] SADC 172
Judgment of His Honour Judge Burnett
14 December 2020
CONTRACTS - GENERAL CONTRACTUAL PRINCIPLES - DISCHARGE, BREACH AND DEFENCES TO ACTION FOR BREACH - REPUDIATION AND NON-PERFORMANCE - REPUDIATION
CONTRACTS - GENERAL CONTRACTUAL PRINCIPLES - FORMATION OF CONTRACTUAL RELATIONS - AGREEMENTS CONTEMPLATING EXECUTION OF FORMAL DOCUMENT - WHERE CONCLUDED CONTRACT
CONTRACTS - GENERAL CONTRACTUAL PRINCIPLES - CONSTRUCTION AND INTERPRETATION OF CONTRACTS - IMPLIED TERMS
CONTRACTS - GENERAL CONTRACTUAL PRINCIPLES - CONSTRUCTION AND INTERPRETATION OF CONTRACTS - EXEMPTION CLAUSES
DAMAGES - MEASURE AND REMOTENESS OF DAMAGES IN ACTIONS FOR BREACH OF CONTRACT - REMOTENESS - LOSS OF PROFITS
DAMAGES - GENERAL PRINCIPLES - MITIGATION OF DAMAGES
The applicant, Ironwill Pty Ltd, had entered into two separate contracts with a third party, Kookaburra Primary Industries (KPI). The first contract, made first in December 2015, required the applicant to clear land at three properties near Yarrowitch in New South Wales. The second contract, made in June 2016, required the applicant to clear land at fifteen properties near Urbenville in New South Wales. The clearing involved chaining, raking and burning the land. To enable it to undertake the work, the applicant required the use of a number of bulldozers.
The applicant carried out the work at Yarrowitch from December 2015 to August 2016 and at Urbenville from July 2016 to January 2017. The applicant gave up, with the consent of KPI, the Yarrowitch contract in August 2016. KPI terminated the Urbenville Contract, effective from 31 January 2017, because the owner of the properties had entered into a contract for the sale of the properties.
On about 19 May 2016 the applicant entered into a contact with the respondents, Carl and Terri Allbut, who traded in partnership as Matrix Agriculture, for the hire from the respondents of a Caterpillar D7H bulldozer (the Allbut D7) together with a rake. The contract was negotiated over a period of time, primarily by email. The respondents had sought that its standard terms and conditions form part of the contract. The applicant had expressed concerns over those terms and conditions. The standard terms and conditions contained an indemnity which indemnified the respondents against any consequential damage or claim howsoever arising as a result of hiring the plant. Ultimately by email dated 19 May 2016 Mr Allbut sent an email to the applicant in which he requested payment of a deposit and the signing of the agreement that comprised the standard terms and conditions. The applicant paid the deposit, but did not ever sign or return the written agreement. There was no further communication between the applicant and the respondents about the standard terms and conditions.
The respondents arranged for the bulldozer to be transported on 22 May 2016 to the property at Yarrowitch where the applicant was undertaking work. When the applicant first used the bulldozer on 23 May 2016, it found that the bulldozer lacked power and was unable to perform the raking function.
Mr Cole of the applicant and Mr Allbut of the respondents had a telephone conversation on 23 May 2016 in which both claim the other repudiated the contract. The result of the conversation was that the respondents arranged for the collection of the bulldozer from the applicant. The applicant is claiming from the respondent the loss of profits arising out of the loss of use of the Albutt D7 that was to be hired from the respondents.
The applicant was unable to hire a further bulldozer.
Held:
1.       The standard terms and conditions did not form part of the contract between the applicant and the respondents. An objective consideration of all the relevant facts and circumstances, including the silence of the applicant and the fact that the standard terms and conditions were required to be signed, but were never signed by the applicant, did not give rise to the inference that the applicant had accepted those terms and conditions.
2.      Therefore, the respondents were unable to obtain the benefit of the indemnity clause contained in the standard terms and conditions which would otherwise have applied. The loss claimed by the applicant was for consequential loss, being the inability to use the bulldozer and hence came within the terms of the indemnity clause, had it applied.
3.      It was an implied term of the contract for the hire of the goods that the bulldozer would be reasonably fit for the applicant’s purpose, as the hirer of the goods. The purpose was made known to the respondents, but was in any event apparent to the respondents.
4.      The Allbut D7 was not reasonably fit for purpose when it was delivered to the applicant because it lacked power to rake. By delivering a bulldozer in that condition, the respondent breached the implied term of the contract.
5.      By its conduct in the telephone conversation on 23 May 2016 the respondents repudiated the contract. The respondents repudiated the contract by delivering a bulldozer that was not reasonably fit for purpose and conveying to the applicant its [the respondents’] refusal to repair the bulldozer and therefore leaving the bulldozer in a condition in which it lacked power and was unsuitable for land clearing work. By this conduct, the respondents expressed their unwillingness to perform the contract according to its terms.
6.      It was a term of the contract that the respondents be given the right to repair and the opportunity to remedy the defect in the bulldozer. That right of repair was implicit from the express term of the contract that the respondents were responsible for any major failure of the bulldozer such as engine failure. The right of repair would also be implied as a matter of a fact.
7.      It followed that the failure to provide a bulldozer that was not reasonably fit for purpose was not sufficient by itself to permit the applicant to immediately terminate the contract without affording the respondents an opportunity to remedy the defect.
8.      There was no failure on the part of the applicant to mitigate its loss. The respondents did not satisfy its onus to demonstrate that the applicant was able to mitigate its loss by hiring an equivalent bulldozer. The respondents also did not establish that the applicant could have mitigated its loss by purchasing another bulldozer. In fact, in July 2016 the applicant did purchase another bulldozer, but that was to replace another bulldozer that had to be returned to its owner.
9.      The applicant was entitled to damages for the loss of profit that is suffered from not having the use of the Allbut D7. The applicant sought to calculate its loss of profits from a determination of the rate of chaining or raking that it would have achieved if it had the use of the Allbut D7 bulldozer. From that determination, a calculation could be made of the extra hectares that would have been chained and raked and the gross profit that would have been derived from that extra chaining and raking. There was considerable uncertainty in using that method of calculating damages. Alternatively, the loss of profit could be calculated by reference to the gross profit earned by each of the bulldozers that were used in performing the Yarrowitch and Urbenville contracts. That method is preferred.
10.    The applicant was entitled to damages in the sum of $50,000.
11.    The counterclaim of the respondents is dismissed.
Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523; CSR Limited v Adecco (Australia) Pty Ltd [2017] NSWCA 121; Hopcroft & Anor v Edmunds & Ors (No 2) [2012] SASC 94; Hopcroft & Edwards v Edmunds & Ors [2013] SASFC 38; Smith v South Wales Switchgear Co Ltd [1978] 1 WLR 165; BI (Contracting) Pty Ltd v AW Baulderstone Holdings Pty Ltd [2007] NSWCA 173; Burke & Anor v State Bank of New South Wales (1994) 37 NSWLR 53; Ankar Pty Ltd v National Westminster Finance (Australia) Ltd (1987) 162 CLR 549; Andar Transport Pty Ltd v Brambles Ltd (2004) 217 CLR 424; Chan v Cresdon Pty Ltd (1989) 168 CLR 242; Macmahon Mining Services Pty Ltd v Cobar Management Pty Ltd [2014] NSWSC 731; Alstom Ltd v Yokogawa Australia Pty Ltd & Anor (No 7) [2012] SASC 49; GEC Alsthom Australia Ltd v City of Sunshine FCA, unreported, 20 February 1996; Regional Power Corporation v Pacific Hydro Group Two Pty Ltd (No 2) [2013] WASC 356; Environmental Systems Pty Ltd v Peerless Holdings Pty Ltd [2008] VSCA 26; (2008) 19 VR 358; Allianz Australia Insurance Ltd v Waterbrook at Yowie Bay Pty Ltd [2009] NSWCA 224; Valentine Falls Estate Pty Ltd v SMEC Australia Pty Ltd [2010] WASC 319; SMEC Australia Pty Ltd v Valentine Falls Estate Pty Ltd [2011] WASCA 138; Saint Line Ltd v Richardsons, Westgarth & Co Ltd [1940] 2 KB 99; Commissioner for Railways (NSW) v Quinn (1946) 72 CLR 345; Gillespie Bros & Co Ltd v Roy Bowles Transport Ltd [1973] QB 400; Smith v South Wales Switchgear Ltd [1978] 1 All ER 18; Ellul &Ellul v Oakes (1972) 3 SASR 377; Hospital Products Ltd v United States Surgical Corp (1984) 156 CLR 41; Bulloch v Glasson (1915) 15 SR (NSW) 91; Inntrpreneur Pub Co (GL) v East Crown Ltd [2000] 2 Lloyd’s Rep 611; De Lassalle v Guildford [1901] 2 KB 215; Esso Petroleum Co Ltd v Mardon [1976] QB 801; BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266; White v Malco Engineering Pty Ltd [2000] NSWSC 1165; Beaton v Moore Acceptance Corporation Pty Ltd [1959] HCA 59; (1960) 104 CLR 107; Derbyshire Building Co Pty Ltd v Becker [1962] HCA 14; (1961-2) 107 CLR 633; Astley Industrial Trust Ltd v Grimley [1963] 1WLR 584; Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd [1962] 2 QB 26; Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd [2007] HCA 61; (2007) 233 CLR 115; Tramways Advertising Pty Ltd v Luna Park (NSW) Ltd (1938) 38 SR (NSW) 632; Associated Newspapers Ltd v Bancks (1951) 83 CLR 322; DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423; Laurinda Pty Ltd v Capalaba Park Shopping Centre Pty Ltd [1989] HCA 23; (1989) 166 CLR 623; Shevill v Builders Licensing Board [1982] HCA 47; (1982) 149 CLR 620; English and Australian Copper Co Ltd v Johnson (1911) 13 CLR 490; Stevenson v Hook TO CHECK THIS ONWARDS (1956) 73 WN (NSW) 307; Bennett v Minister for Community Welfare (1992) 176 CLR 408; Chappel v Hart [1998] HCA 55; (1998)195 CLR 232; Fitzgerald v Penn (1954) 91 CLR 268; Mahoney v J Kruschich (Demolitions) Pty Ltd (1985) 156 CLR 522; March v E & MH Stramare Pty Ltd (1991) 171 CLR 506; Henville v Walker (2001) 182 ALR 37; Caltex Oil (Australia) Pty Ltd v The Dredge Willemstad (1976) 136 CLR 529; Environment Agency v Empress Car Co (Abertillery) Ltd [1999] 2 AC 22; Alexander v Cambridge Credit Corporation Ltd (1987) 9 NSWLR 310; TC Industrial Plant Pty Ltd & Anor v Robert’s Queensland Pty Ltd (1963) 180 CLR 130; Commonwealth of Australia v Amann Aviation Pty Ltd (1991) 174 CLR 64; Lamson Paragon Ltd v Spicer’s (Australia) Ltd [1953] SASR 297; Commonwealth of Australia v Amann Aviation Pty Ltd (1991) 174 CLR 64; Placer (Granny Smith) Pty Ltd v Thiess Contractors Pty Ltd (2003) 196 ALR 257; Australian Goldfields NL (in liq) v North Australian Diamonds NL [2009] WASCA 98; LMI Australasia Pty Ltd v Baulderstone Hornibrook Pty Ltd [2003] NSWCA 74; Berry v CCL Secure Pty Ltd [2020] HCA 27, considered.

IRONWILL EARTHMOVING PTY LTD v ALLBUT & ANOR
[2020] SADC 172
Introduction

The applicant, Ironwill Earthmoving Pty Ltd, claims damages from the respondents, Carl Allbut and his wife, Terri Allbut, for repudiation and breach of contract. In its statement of claim, the applicant sought damages in the sum of $966,745.00. The applicant revised this claim in its closing address to the sum of $544,098.00. In further submissions, following the delivery of a fourth expert report from its expert, Mr Benjamin Opie dated 21 September 2020, the applicant accepted that this revision was overstated and sought damages in the region between $77,858 and $102,604.
The respondents, who at the relevant time traded in partnership as Matrix Agriculture, denied that they had repudiated the contract or that any breach of the contract justified its termination. Instead, they claimed that the applicant had repudiated the contract and that they, the respondents. were entitled to damages in the sum of $64,037.64.
On 7 December 2015, the applicant had entered into a contract with Kookaburra Primary Industries (KPI) for the clearing of land at a number of properties near Yarrowitch in the New England region of New South Wales. As at May 2016, the applicant was also involved in negotiations with KPI for the clearing of further properties at or near Urbenville in New South Wales. The applicant entered into a contract with KPI on about 21 June 2016 to undertake the land clearing work at Urbenville.
The land clearing work required the properties to be chained, raked and burnt. The properties had formerly been used as part of a managed investment scheme and the purpose of the land clearing work was to restore the properties to a condition suitable for agriculture so that the properties could then be sold.
To undertake that land clearing work, the applicant hired a number of bulldozers (and later purchased one bulldozer itself).
On about 19 May 2016, the applicant entered into the contract with the respondents for the hire of the Caterpillar D7H bulldozer (the Allbut D7), together with a rake. The purpose of the hire was to use that machine in undertaking work on the Urbenville Properties as well as the Yarrowitch Properties.
Under the contract, the applicant paid a deposit of $5000 on 19 May 2016.
The Allbut D7 was delivered to the applicant on about 22 May 2016. When the applicant used the machine on the following day, it claimed that the machine lacked power. The applicant claimed that the Allbut D7 was defective and unsuitable for the land clearing work because of this lack of power. The applicant also claimed that the rake was unsuitable in that it was too large and was not a folding rake.
Mr Barry Cole (Mr Cole), on behalf of the applicant, and Mr Carl Allbut (Mr Allbut) had a telephone conversation on 23 May 2016, the result of which was that the Allbut D7 and rake were made available for collection by the applicant and were collected the following day. Both parties claim that during the telephone conversation the other repudiated the contract.
The applicant claimed that because of the repudiation or breach of contract by the respondents, it was entitled to claim the profits that it would have earned from undertaking further work on the Yarrowitch and Urbenville Properties pursuant to its contract with KPI. For reasons unrelated to the performance of the applicant, KPI terminated the Urbenville Contract with the applicant effective 31 January 2017. The applicant had previously ceased working on the Yarrowitch Properties in August 2016.
The applicant claimed that if it had the use of the Allbut D7, it would have been able to undertake a greater amount of chaining and raking on the Yarrowitch and Urbenville Properties in the period up to 31 January 2017.
The claim of the applicant therefore requires a determination of the amount of chaining and raking it could have expected to achieve if it had the extra bulldozer, the Allbut D7, to use in the land clearing work.
The respondents have raised a number of defences to the claim. They are:
a.The terms of the contract between the applicant and the respondents included the standard terms and conditions of the respondents, which terms and conditions included an indemnity in favour of the respondents;
b.There was no breach of contract justifying the termination or repudiation of the contract by the respondents;
c.Even if the Allbut D7 lacked power and for that reason was not fit for the purpose required, the applicant was not entitled to terminate the contract between the applicant and respondents for breach, without giving the respondents the opportunity to repair the Allbut D7;
d.It was the applicant which repudiated the contract in the telephone conversation between Mr Cole of the applicant and Mr Allbut on 23 May 2016;
e.If the respondents did repudiate the contract, then that act of repudiation was not causative of the loss claimed by the applicant;
f.The applicant has not suffered loss in the amount claimed;
g.The applicant has failed to mitigate its loss by either purchasing or hiring an equivalent bulldozer.
The respondents claimed damages on its counterclaim consisting of monies paid for the freight of the Allbut D7 bulldozer, repairs to the rake, service and maintenance costs and loss of income for the period of six months.
Parties
Mr Cole is 67 years of age and the sole director of the applicant.
He has had 50 years’ experience in working on, operating and managing grazing properties. In those capacities, he had extensive experience in owning and operating heavy farm machinery including excavators and bulldozers. He also had experience in performing maintenance, repair and mechanical work on bulldozers.
From about April 2015 to about September or October 2015, Mr Cole was employed by a Mr Craig Eastment as the field supervisor for the land clearing work then being undertaken by Mr Eastment on the Yarrowitch Properties. At that time, Mr Eastment had the contract with KPI to clear the Yarrowitch Properties.
In about September or October 2015, the contract between Mr Eastment and KPI was terminated.
Mr Cole decided to take over the contract with KPI and for that purpose the applicant was registered on 30 November 2015. The only work undertaken by the applicant (except for some dam building work for a neighbour of the Yarrowitch Properties, to which I will refer later in these Reasons) was in relation to the Yarrowitch Properties and later the Urbenville Properties.
Mr Cole’s partner, Ms Linda Parkinson, assisted in undertaking some of the administrative work associated with the applicant.
Mr Allbut and his wife, Terri-Ann, were partners in the business which traded as Matrix Agricultural. It was Mr Allbut who was the person who undertook all the business activities of Matrix Agricultural. Mr Allbut left school in Year 11 and commenced, but did not complete, an apprenticeship as a fitter with Tru-Flo Pumping Systems (Tru-Flo). Mr Allbut was engaged in full time employment with Tru-Flo to about mid-2019. Tru-Flo was a family company, owned by the three directors who were Mr Allbut’s father and uncles. Tru-Flo was based in Bathurst in New South Wales where Mr Allbut and his wife lived and specialised in manufacturing both diesel and electric pumps for use in the mining industry.
Mr Allbut, whilst employed by Tru-Flo, commenced operating a business, as a sole trader, in which he rented bulldozers. Mr Allbut gave evidence that he had purchased and sold quite a few bulldozers over the years. He gave evidence that he purchased his first bulldozer when he was about twenty years of age for $320,000, of which he borrowed about $150,000. It is not apparent to me how Mr Allbut was able to fund this purchase.
Matrix Agricultural was established in November 2015. The business of Matrix Agricultural was providing rental equipment such as bulldozers to the mining, civil and agricultural markets. Matrix Agricultural no longer carries on business. In April 2019, Mr Allbut arranged for the incorporation of a company, Matrix Civil and Mining Pty Ltd, which carries on the same rental business.

Matrix Agricultural owned one bulldozer, a Caterpillar D8T, at the time of the commencement of the partnership in November 2015. In about November 2015, it acquired a further bulldozer, a Komatsu D155 bulldozer.
The Caterpillar D8 range and the Komatsu D155 range are equivalent sized machines and are larger than the Caterpillar D7 and the Komatsu K85 range, which are also similar sized machines. The Caterpillar D6 and the Komatsu D65 are also equivalent sized machines, but smaller than the other machines that I have referred to.
In about May 2016, Matrix Agricultural acquired, for the purposes of its contract with the applicant, the Allbut D7, the subject of these proceedings. Matrix Agricultural was also engaged in cross-hire, where it hired machinery from a rental company and then on-hired that machinery to a third party.
Course of the Trial and Credit
The applicant called two witnesses, Mr Cole and an expert accountant, Mr Opie. Mr Cole gave evidence on a wide range of issues including the operations of the applicant, land clearing, the entering into and performance of the applicant’s contracts with KPI at Yarrowitch and Urbenville, the reliability and performance of the bulldozers that were hired, the hiring of the Allbut D7 and the communications and negotiations with Mr Allbut, the performance of the Allbut D7, his subsequent discussion with Mr Allbut on 23 May 2016 in which both parties claim that the other repudiated the contract, the collection of the Allbut D7, the collection of the rake by Mr Anthony Hyde who operated a business under the name of All Rural Contracting Pty Ltd, his attempts to mitigate the applicant’s loss by purchasing or hiring another bulldozer and the subsequent purchase by the applicant of the another bulldozer, a Komatsu D85 (the Ironwill K85).
I find Mr Cole to be a truthful and reliable witness. He was an experienced operator of machines, including bulldozers. He was a responsive witness who was prepared to admit when he could not recall a conversation or a matter or had a recollection of only part of a matter. His evidence was generally consistent with his diary notes (which were reasonably extensive) and other written communications, which were less extensive. His evidence also accorded with commercial reality, particularly in relation to the critical disputed telephone conversation with Mr Allbut on 23 May 2016. There was no rational reason why Mr Cole, on behalf of the applicant, would agree to the forfeiture of a deposit in relation to the Allbut D7 when he had received that machine the previous day and found it to be unsatisfactory through no fault of the applicant. In relation to that disputed conversation, as set out later in these Reasons, I prefer the evidence of Mr Cole to that of Mr Allbut.
Mr Opie is an expert forensic accountant. He produced four substantive reports, dated 19 December 2017, 20 March 2020, 3 April 2020 and 21 September 2020 which addressed the loss claimed by the applicant. In each report, Mr Opie prepared a calculation of the hypothetical profit that the applicant would have derived if it had the use of the Allbut D7. There was no challenge to the reasoning of Mr Opie in these reports. There was a challenge by the respondents to the assumptions that Mr Opie was asked to make about the operations of the applicant and in particular the rate of chaining and raking, which, along with burning, was the way in which the applicant earned its income from the land clearing contract it had with KPI.
The first report by Mr Opie was based on an assumption that chaining would be conducted at the rate of 35 hectares per day (by two machines acting in tandem) and raking would be conducted at the rate of 8 hectares per day per machine (in flat country) and 6 hectares per day per machine in steep country. The second and third reports of Mr Opie reflected alternative assumptions put to him by both the applicant and respondents as to the rate of chaining and raking and therefore the amount of income that would be derived by the applicant in the hypothetical scenario that it kept and used the Allbut D7. The second report also calculated the gross profit derived by each bulldozer used in carrying out the work. The fourth report addressed some further assumptions and also adopted a start date for work at Urbenville of 1 July 2016, which accorded with the evidence.
I accept that the methodology employed by Mr Opie was appropriate, although it is a matter for me to determine what level of raking and chaining would have been performed and therefore what income would have been derived in the hypothetical scenario that the Allbut D7 was able to be used.
The respondents called two witnesses, Mr Allbut and Mr Hyde.
Mr Allbut gave evidence about the business of the respondents, the purchase and delivery of the Allbut D7, his communications and negotiations with Mr Cole on behalf of the applicant, his communications with Mr Hyde about the delivery and picking up of the Allbut D7 and the rake, the repair of the Allbut D7 and the hiring of that bulldozer to Mr Hyde from June 2016.
I did not find Mr Allbut to be a satisfactory witness and I prefer the evidence of Mr Cole to Mr Allbut in relation to the critical conversation that occurred between them on 23 May 2016. Mr Allbut’s evidence about this conversation was inconsistent with his fifth defence and fifth counterclaim, a matter which I will examine in greater detail later in these Reasons.
Mr Allbut generally had a poor recollection of events. He could not remember many relevant matters, but expressed to have a perfect memory of the conversation with Mr Cole. For example, Mr Allbut could not initially recall how many conversations that he had with Mr Hyde on 23 May 2016 about the collection of the Allbut D7 and the rake, but later, when shown an email that he sent to Mr Hyde on 23 May 2016 at 2.18pm, recalled that there were two conversations with Mr Hyde on that day. In cross-examination, Mr Allbut admitted that he initially had a lack of memory about this matter and his memory was jogged by seeing the email. He had a very poor recollection of many matters both in his personal and business life. Such a poor recollection is inconsistent with his evidence regarding his detailed and precise evidence of the conversation with Mr Cole on 23 May 2016.
Mr Allbut’s record keeping was poor. He was not in the habit of recording any details of his business affairs in writing. He gave evidence that he did not keep a diary in relation to his business, even though he was hiring sometimes 2 or 3 bulldozers at any one time.
Mr Allbut was prone to make unqualified statements in his evidence and then retreat from those statements when confronted with conflicting evidence. For example, in examination in chief, the following evidence was given by Mr Allbut:[1]
Q: What about wet hire, what’s that;
A:Wet hire is where you would normally provide a machine with an operator and normally speaking you would supply fuel also but that’s normally negotiated as put (sic) on a project basis.
Q:Matrix Agriculture in 2015 and 2016, were they involved in wet hire at all?
A:No
Q:Was it all dry hire?
A:Correct
[1] T353.2 – 353.1.
In cross-examination, when asked about an invoice rendered by Matrix to a company called Decmil Australia for wet hire at $140.00 per hour, Mr Allbut said:[2]
Yeah, well I will clarify the reason for that. The reason we took that project on is because this one fell over. It was a matter of rescuing the business really, that’s why we took that on.
[2] T4441.30 – 4411.33.
Mr Allbut was clearly giving the impression that this wet hire to Decmil Australia was a one-off event. However, later in his cross-examination, he said:[3]
I wouldn’t say we don’t do it [ie wet hire] in its entirety, we do it in order to keep the business running if we need to.
Mr Allbut went on to say:[4]
I explained yesterday we do it when we need to rescue the business or maintain the business.
Still later, he said:[5]
So to maintain the operation of the business we will do it from time to time, if it’s required, we will do wet hire.
[3]    T494.11 – 494.13.
[4]    T494.14.
[5]    T494.24.
Mr Allbut was not always forthright and open with Mr Cole during the course of the negotiations. He gave evidence that he had a discussion with Mr Cole in which Mr Cole said that he was looking for a rake between 19 and 20 foot. On 21 April 2016, Mr Allbut sent an email to Mr Cole which included a quotation. The quotation referred to an hourly rate for the Allbut D7 and the provision of a 16-18 foot stick rake. In his email dated 26 April 2016, Mr Allbut referred to the Allbut D7 bulldozer that was available and a 20-foot folding rake. By email dated 2 May 2016, Mr Allbut advised Mr Cole that he was purchasing a near new 20-foot rake. In the quotation that accompanied that email, there was reference to the provision of the 20-foot stick rake. On the very next day, Mr Allbut purchased a 22-foot stick rake. At no time did he advise Mr Cole of the size of the rake. On 4 May 2016, he sent a deposit invoice, which merely referred to the provision of a stick rake, but made no reference to its size. A further revised deposit invoice dated 16 May 2016 (but sent with an email dated 19 May 2016) also made no reference to the size of the stick rake.
I also found Mr Allbut to be frequently evasive in responding to questions in cross-examination. Mr Allbut was not forthcoming about how he was able to purchase his first bulldozer in the sum of $320,000 (of which he borrowed about $150,000) when at the time of that purchase he was about 20 years of age and had been working for a couple of years in the family business.
Mr Hyde gave evidence about his dealings with Mr Allbut about the delivery of the Allbut D7 to Jamberoo (one of the Yarrowitch properties), his telephone conversations with Mr Allbut on 23 May 2016 about returning to Jamberoo to pick up the Allbut D7 and rake, his collection of the rake the following day and the conversation that he had with Mr Cole on that occasion, the inspection of the Allbut D7 to ascertain the cause of the lack of power, his hiring of the Allbut D7 and a subsequent telephone conversation with Mr Cole when Mr Cole rang to enquire about hiring a bulldozer.
I consider Mr Hyde to be an honest witness and reliable witness, who did his best to assist the Court. However, I do not accept his evidence in relation to the 24 May 2016 conversation that he had with Mr Cole. Mr Hyde gave evidence that when Mr Cole rang him some time after the return of the Allbut D7 on 24 May 2016, he had a conversation with him when he said that he advised Mr Cole that he was himself hiring the Allbut D7 from Mr Allbut at the rate of $75.00 per hour. Mr Cole says that this conversation occurred on 24 May 2016 when Mr Hyde attended at the Jamberoo Property to collect the rake. Mr Hyde admitted that he was in the habit of advising the wrong hiring rate to third parties who made enquiry of him (because he did not consider that to be any business of the third party), but says that he did not make that statement on 24 May 2016. I find that Mr Hyde was mistaken as to the date. There is no particular reason why he would recall the conversation in specific detail. His account is inconsistent with the email from Ms Parkinson dated 25 May 2016 where reference was made to the lucrative rate at which the Allbut D7 was being hired out for. That “lucrative rate” must have come from the conversation between Mr Cole and Mr Hyde on 24 May 2016.
Background facts
The Yarrowitch Properties were situated near Walcha, in the New England Area of New South Wales. There were four separate properties in that group, Yarrobindi (also known as Lamoureux), Jamberoo, Mooraback (also known as Quilty) and Rockend. The properties included some land that was very steep.
There were 15 properties in the cluster of properties known as the Urbenville Properties, such properties being known as Downham, Maloney, Bernies Top, Hines, Bolster Walker, Smith, Hill, McKenzie, Howarth, Lindsay, Garthoon, Swallow’s Nest, Clover Park and Leadbeatter.
There had been a failed eucalyptus plantation on the Yarrowitch and Urbenville Properties. A company by the name of Forest Enterprises Australia Ltd had operated a managed investment scheme in which it planted timber plantations at properties throughout New South Wales, Queensland and Tasmania. The managed investment scheme failed and Forest Enterprises Australia went into liquidation.
An American Company, Resource Management Services LLC, purchased the properties, including the Yarrowitch and Urbenville properties, with a view to restoring the properties to agriculture and ultimately re-selling the properties.
KPI was the trading name for RMS Forest Assets Pty Ltd as trustee for the RMS AFA Fund 1 Trust and was responsible for the land clearing work at the Yarrowitch and Urbenville Properties.
On 7 December 2015, the applicant entered into the contract with KPI to undertake land clearing work on the Yarrowitch Properties. Specifically, the applicant was engaged to undertake raking and burning plantation timber at Lamoureux and Jamberoo and chaining, raking and burning plantation timber at the Quilty property. KPI, for reasons unknown to the applicant, did not require the applicant to undertake any work at all at Rockend.
The contract could be terminated by either party on one month’s notice. The total contract price was in the sum of $989,730.00 plus GST and comprised:
·Approximately 914.5 hectares of raking and burning at Lamoureux at the rate of $350.00 per hectare;
·Approximately 969.5 hectares of raking and burning at Jamberoo at the rate of $350.00 per hectare;
·Approximately 793.8 hectares of raking and burning at Quilty at the rate of $350.00 per hectare;
·Approximately 150 hectares of chaining, raking and burning at Quilty at the rate of $350.00 per hectare;
·For very steep areas, by agreement of the parties, the rate per hectare for the above areas was increased to $390.00.
The land clearing involved three stages, chaining, raking and burning.
Chaining was performed by two bulldozers, working in tandem. A chain of about 100 metres was attached to each of the bulldozers, forming a U shape such that the chain extended to about 50 metres behind the bulldozers. The chain was then used to push over the trees. I accept the evidence of Mr Cole that chaining was more effectively performed by larger bulldozers which had more power and greater traction. I also accept the evidence of Mr Cole that chaining was best performed by bulldozers of equal size and power where the chain was slung equally behind the two machines. It was also important, when chaining was being undertaken, that the bulldozer have a special canopy over the driver’s seat, commonly called a scrub canopy, to prevent injury from falling timber. The scrub canopy was custom built for a particular bulldozer and was in addition to the standard rollover canopy.
Raking was the second stage of the clearing process and involved, as the name suggests, raking the fallen timber into piles where they were to be subsequently burnt. Mr Cole gave evidence that the applicant adopted a different raking process to that adopted by Mr Eastment. Mr Eastment raked all the timber into a large windrow in the middle of a paddock. Mr Cole however raked the timber into a number of small piles throughout the paddock.
The third stage of the process involved burning the timber that had been raked into piles. As I will examine in greater detail later in these Reasons, there was not a lot of evidence about the burning process or the time that it took. Mr Cole gave evidence that the piles would be lit in the evening and burnt down over night. The next day the piles could be pushed into the next heap and so on.
The process adopted by Mr Eastment during 2015 was to chain all the properties, before undertaking any raking or burning work. Mr Cole gave evidence that he considered the better approach was to chain, rake and burn an area and then move onto the next area where the process would be repeated. This latter approach was also favoured by KPI.
To undertake the work on the Yarrowitch Properties, the applicant:
·hired a Komatsu D65 bulldozer from Wanless (the Wanless K65) with attached rake on 14 December 2015 at the rate of $40.00 plus GST per hour (ie per hour in which the machine was in operation);
·hired a Caterpillar D6R from Peart Rural Land Development (the Peart D6) in December 2015 at the rate of $33.00 per hour plus GST;
·hired a Komatsu D85 from Wanless (the Wanless K85) on 21 January 2016 at the rate of $40.00 per hour plus GST. It appears that this rate was later varied to $45 per hour plus GST;
·hired a Caterpillar D6H from Scott Hedges and Sons Earthmoving (the Hedges D6) on 17 February 2016 at the rate of $36.00 per hour.
Mr Cole described the Wanless K65 as very reliable but that they had some problems with it- “It did have a - two issues that we dealt with - that Wanless dealt with us for us”.[6]
[6] T124.
Mr Cole gave evidence that there were some problems with the Peart D6. The Peart D6 required a complete engine rebuild not long after the applicant took possession. The fuel pump on the Peart D6 also failed. The applicant also experienced continual radiator problems with the Peart D6 which resulted in the purchase and installation of radiator modules (which were offset against the Peart hire invoices). By mid-2016, these difficulties appeared to have been resolved and there is no evidence that they manifested themselves at Urbenville.
Mr Cole described the Wanless K85 as very reliable and that it was virtually a brand-new machine (only having about 2000 hours on it).
The Hedges D6 was described by Mr Cole as very unreliable. It was not operational in May 2016. Mr Cole said:[7]
The reliability of the machine was such that he [Mr Hedges] ended up owing us money, and when he eventually pulled out of the job and he went bankrupt he ended up owing us $2000-odd, which we never chased him for because we felt sorry for him because he just didn’t get a decent run out of it.
[7] T122.
In his diary, Mr Cole recorded on most occasions, at least in relation to the work at Yarrowitch, the number of hours worked each week by each machine. In the period between 8 March 2016 and 25 April 2016, a period of 7 weeks, the Hedges D6 worked 129 hours. The applicant returned the Hedges D6 to Mr Hedges in May 2016.
The applicant carried out raking and burning work on the Yarrowitch Properties from December 2015 to early August 2016. At that time, the applicant had not completed all the raking and burning on the Yarrowitch Properties, but decided to voluntarily relinquish that contract. Mr Cole gave evidence that the applicant was not making any money on the Yarrowitch Contract.
Negotiations between the applicant and respondents
From about April 2016, the applicant was looking to hire another bulldozer to replace the Hedges D6. On 11 April 2016, the applicant placed an advertisement on a website named Dry Hire Online seeking to hire a bulldozer. Mr Allbut responded to that advertisement. Most of the communications between Mr Cole and Mr Allbut in relation to the formation of the contract were by email, although there were some telephone conversations.
I find that the first communications between Mr Cole and Mr Allbut were two telephone conversations that were held some time prior to 21 April 2016. I find that in these conversations there was a general description by Mr Cole about the requirements of the applicant for a bulldozer and the type of work for which the machine was required and where that work would take place.
The email following these conversations, being an email from Mr Allbut to Mr Cole dated 21 April 2016, provides general evidence of the substance of these prior telephone conversations. The email attached the general terms and conditions of the respondents and a quotation for the hire of a Caterpillar D7 or Komatsu K85 at the rate of $55.00 per hour (plus GST). The quotation included the provision of a 16-18-foot stick rake. I find that it is likely that Mr Cole mentioned the requirement of the rake to Mr Allbut in these terms at this time.

Mr Allbut gave evidence that the discussion centred around a rake of about 20 feet, but the contemporaneous documents are more consistent with the reference being made to a 16-18-foot rake.
I also find that there was at least a general description of the terrain where the applicant was working. Mr Allbut gave evidence that he had a basic discussion with Mr Cole about a land clearing project. Mr Allbut’s evidence was that he had quite a bit of experience in land cleaning and that “it can be assumed that chaining could be done but there is a lot of land clearing done without chaining, possibly especially on regrowth areas, chains are not normally used”.[8]
[8] T368.
The respondents submitted that the applicant’s pleaded case in relation to this conversation was not made out. At paragraph [9.1.2] of the Second Statement of Claim, the applicant pleaded:
Ironwill specifically described the Yarrowitch Contract and the Urbenville Contract [Projects], including the nature and extent of Ironwill’s hiring requirements, the nature and type of work which the proposed hire dozer would be required to perform, and the type of terrain that would be involved.
The respondents’ complaint was that there was no discussion about the type of work that the bulldozer would be required to perform or the type of terrain that would be involved. Mr Cole gave evidence that he told Mr Allbut that the bulldozer would be required for a land clearing project and that he advised Mr Allbut about the nature of the terrain where the bulldozer would be operating and that Mr Allbut replied that he knew the area.
These are obvious topics of discussion. There may be differences in detail, but I do not consider them to be significant. I certainly do not consider the minor differences in detail to reflect adversely on the credit of either party.
The applicant responded to the email dated 21 April 2016 by email dated 24 April 2016 in which it advised the respondents inter alia that their terms and conditions were unacceptable. The applicant expressed a particular concern in relation to the repair and maintenance obligations. The applicant did indicate that if the respondents were willing to negotiate on the terms and conditions, it was willing to continue discussions as it required a machine as soon as possible.
The respondents submitted that the email demonstrated the level of detail in which the terms and conditions were negotiated and it, says, ultimately agreed. I accept that the applicant was heavily involved in negotiations with the respondents about the terms and conditions upon which the Allbut D7 was to be hired.
Mr Allbut sent a further email to Mr Cole on 26 April 2016 in which he advised him of a Caterpillar D7 (ie the Allbut D7) which he could hire with a 20-foot folding rake and canopy. In this email, Mr Allbut referred to upgrading the machine (being the Allbut D7). The applicant submitted that I should find that in this email Mr Allbut lied to the applicant by suggesting that he had the Allbut D7 available to hire as at 26 April 2016. I am not prepared to make such a finding. In my view, Mr Allbut was merely advising the applicant of the possible bulldozers that could be hired. The Allbut D7 was such a bulldozer and was in fact hired.
Mr Allbut followed up with a further email on 2 May 2016 in which he attached a revised hire agreement and a further quotation. The email refers to the machine (the Allbut D7) being “back at our yard by the back half of next week”. The applicant cross-examined Mr Allbut on this wording, suggesting that he was deliberately seeking to mislead the applicant by suggesting that the Allbut D7 had previously been in his possession and therefore he was able to vouch for its reliability.
I am not prepared to find that Mr Allbut deliberately sought to deceive Mr Cole. Although the word “back” does suggest the machine had previously been in the possession of the respondents, it imports to Mr Allbut a sophistication and care in the use of language which I do not consider was present.
The email records that the respondents were purchasing a near new 20 foot rake for the project. The attached quotation included reference to the 20-foot stick rake.
Mid-West Earthworks sold the Allbut D7 to the respondents on 2 May 2016 for the sum of $175,000.00 plus GST.
On 3 May 2016, the respondents purchased a 22-foot stick rake from Bright Machinery Pty Ltd for the sum of $22,500.00 plus GST.
On 4 May 2016, Mr Allbut sent a further email to Mr Cole in which he requested the signed agreement to be returned. The respondents also attached a deposit invoice in the sum of $9075 (inclusive of GST). The applicant did not ever return the signed terms and conditions as, according to Mr Cole, the applicant never agreed to the terms and conditions although that is a matter in dispute. The deposit invoice was also not paid at this time as the applicant did not agree to a deposit in the amount specified. The deposit invoice referred to the “Hourly rate includes stick rake”, but did not (unlike the earlier quotations) specify the length of the stick rake. The respondents, by this time, knew that the rake was a 22-foot stick rake.
The tenor of the communications between the parties at this time was that the parties had agreed upon the bulldozer to be hired and the rate of hire, but had not yet agreed on the terms and conditions or the amount of the deposit.
The next substantial communication between the parties occurred on 9 May 2016, when Mr Allbut sent an email to Mr Cole advising of the date when the Allbut D7 and the rake would be available and requesting the terms and conditions to be signed and returned and the deposit paid.
By email dated 12 May 2016, Mr Cole responded, setting out his concerns with the latest draft of the terms and conditions that had been submitted by the respondents. This email was written by Ms Parkinson with the knowledge of Mr Cole and reflected the terms of a conversation the previous day between Mr Allbut and Ms Parkinson. The email sets out the particular clauses of the draft terms and conditions in respect of which the applicant had concerns. Importantly, the applicant submitted, the email referred to the terms and conditions of Wanless being the type of terms and conditions that they were expecting and which they considered to be fair and reasonable. The Wanless terms and conditions were a good deal simpler than the Allbut draft. The email also refers to the intention of Mr Cole and Ms Parkinson, on their return to Jamberoo from Adelaide, making a detour to Bathurst to inspect the Allbut D7.
Mr Allbut responded on the same date, 12 May 2016, enclosing a further draft of the terms and conditions and indicating a willingness to negotiate on the amount of the deposit. The respondents submitted that this further draft is important because it incorporates the changes to the terms and conditions that had been requested by the applicant. Mr Allbut stated that he wanted a deposit at the equivalent to the cost of hire for 2 weeks at the minimum 40 hours hire rate. The draft terms and conditions, as with all other drafts of the terms and conditions, included a space for each of the parties to sign the agreement.
On about 17 May 2016, a business known as WesTrac, at its yards near Bathurst, performed a service of the Allbut D7 for the respondents.
Mr Allbut sent an email to Mr Cole on 18 May 2016 attaching photographs of the Allbut D7 and the rake. The email also refers to a proposed inspection of the machine by Mr Cole on 20 May 2016. The inspection did not ultimately take place. Both parties blame the other for that failure, but I do not need to decide where the fault lies.
On 19 May 2016, Mr Allbut sent an email to Mr Cole. As this email is important for the purposes of the respondents’ contention that the terms and conditions of the respondents formed part of the agreement between the applicant and respondents, I will set out the terms of the email in full:
Please see attached revised Deposit invoice as agreed. I have also attached a few extra pictures along with a photograph of the hour meter. If a photograph of the hour meter could be emailed to me on the last day of each month from here on it would be much appreciated.
If you could get back to me tomorrow morning with:
# Delivery directions
#Sign copy of the agreement and remittance for the deposit
Thanks heaps and have a good trip across.
A revised invoice for the deposit was attached to the email in the sum of $4,400.00 plus GST, which represented 2 weeks hire at the minimum charge of 40 hours per week.
The applicant paid the deposit on 19 May 2016 by direct debit and by email to Mr Allbut dated 20 May 2016 attached the record of that payment. In fact, the applicant paid a deposit in the sum of $5000, rather than the $4840 specified in the deposit invoice. It is not clear why the applicant paid that sum. It is also not clear why the applicant did not sign or return the terms and conditions. There was no further communication between the parties in relation to the terms and conditions.
Mr Allbut arranged for Mr Hyde to transport the Allbut D7 to Jamberoo. It arrived there on 22 May 2016, at which time Mr Cole was still on route from Adelaide to Jamberoo. Mr Cole arrived at Jamberoo late on 22 May 2016. The rake arrived the following day.
On 23 May 2016, Mr Cole and one of his employees fixed the rake to the Allbut D7 and set about using the bulldozer. Mr Cole gave evidence, which I accept, that the Allbut D7 lacked power and was unable to push the load with sufficient force. Mr Cole estimated that it was 25-30% down in power compared to the other similar machines. It transpired that there was a problem with one of the diesel injectors, but Mr Cole did not ascertain the problem at the time.
Mr Hyde, who later carried out an investigation into the Allbut D7, found that there was a problem with one of the injectors which was worn and leaking. He found that diesel was coming out of one of the injectors. He gave evidence that the failure of an injector would cause a significant power reduction in the operation of the bulldozer. Ultimately all six injectors were replaced, but there was no evidence that the condition of the other five injectors had contributed to the lack of power.
The respondents have accepted there was a problem with one of the injectors and that caused a loss of power when Mr Cole was trying to operate the machine.
In these circumstances, I find that the Allbut D7 was not in a suitable condition when it was delivered to the applicant because of the lack of power caused by the leaking injector. It was not suitable for the work that was being undertaken on the Yarrowitch Properties and was to be undertaken on the Urbenville Properties. It does not matter for these purposes that the fault was relatively minor. That issue will assume greater significance when assessing whether it was a term of the agreement between the applicant and the respondents that, in the event of a breakdown, the respondents be given an opportunity to inspect and repair the machine.
Mr Cole rang Mr Allbut to complain about the Allbut D7 and its lack of power. What followed was a very short conversation, but one that has very serious ramifications in relation to these proceedings and to the issue which party repudiated the contract. Both parties have differing versions of the conversation. Neither party made any written record of the conversation.
Mr Cole’s evidence was that the conversation lasted for about 90 seconds. He said that the conversation was in the following terms:[9]
Mr Cole:Carl, we need a mechanic, this thing’s way down on power.
Mr Allbut: It’s just come out of WesTrac, it’s just had a service.
Mr Cole:It’s way down on power, Carl.
Mr Allbut:Well, that’s as good as it gets.
Mr Cole: Well if it’s as good as it gets, then it’s no good to us”.
[9] T210.
Mr Cole gave evidence that the machine was collected the following day from the paddock at Jambero. Mr Cole gave evidence that he received a text saying that Mr Hyde was going to be there the following day to pick up the rake.
On the other hand, Mr Allbut gave evidence that the conversation was in the following terms:[10]
Mr Cole:This machine’s not going to do the job, the rake is too big for the area I’m working in, it won’t even push the rake uphill in second gear.
Mr Allbut:If there’s something wrong with the machine would you like me to send a mechanic out and if you think it’s the rake we will come and pick it up and get it cut down and returned.
Mr Cole:No, I don’t want to use it any more, I will forfeit the deposit, come and pick it up.
[10] T382.
The critical difference in the evidence of Mr Cole and Mr Allbut concerns whether Mr Allbut offered to repair the machine (as Mr Allbut contends) or whether he did not offer to repair the machine (as Mr Cole contends).
I find that the conversation occurred in the terms of the evidence given by Mr Cole. I make this finding for the following reasons.
First, for the reasons expressed earlier in these Reasons, I find Mr Cole to be a more reliable witness than Mr Allbut.
Secondly, it is incomprehensible that Mr Cole would have acted in the way that Mr Allbut described in his evidence. The applicant had an urgent need for the machine for the work on the Urbenville Properties (as at 23 May 2016, the applicant had quoted for the work but not been awarded it). The applicant did not have any alternative machine available to it at this time. The applicant had previously shown patience with machines that did not operate as well as expected. It is inconceivable that in these circumstances that the applicant would change its mind after having the machine for one day (during which time it was not capable of carrying out the required work) and agree to forfeit the deposit, even though it was the respondents who were at fault in supplying a machine that was not suitable and was not able to carry out the work. The applicant had only committed to the hire of the Allbut D7 on 19 May 2016 when it paid the deposit of $5000.
Thirdly, the Allbut D7, having just been serviced, it is likely that Mr Allbut would have said that the performance of the Allbut D7 was “that’s as good as it gets”.
The respondents submitted that I should find it equally implausible that Mr Allbut did not offer, and in fact implicitly refused, to repair the Allbut D7. The respondents submitted that in circumstances where (1) they had purchased the Allbut D7 specifically for the purpose of hire to the applicant, (2) had incurred the cost of transporting the bulldozer to Jamberoo and (3) had entered into a relatively long-term contract with the applicant, it was implausible that Mr Allbut would not have offered to or refused to, repair the bulldozer. I accept that these are all good reasons as to why it would make commercial sense for Mr Allbut to have made such an offer. However, I do not consider that it was implausible that Mr Allbut would not have offered to repair the bulldozer. As I have noted, the bulldozer had just been serviced, the location was remote, the hire contract, although attractive in terms of its length was not particularly attractive in terms of its rate, the business practice of the respondents was to buy, sell and cross hire machines, including bulldozers and the fact that the applicant had paid the deposit, all suggest to me that while it may have made commercial sense to offer to repair the machine, it was not implausible that Mr Allbut did not offer to do so.
Fourthly, the version of the conversation given by Mr Allbut is inconsistent with his fifth defence where the respondents pleaded that:
On 23 May 2016, James Cole contacted Carl Allbut by telephone and stated words to the effect that the plaintiff [applicant] no longer wanted the D7H Bulldozer, that the rake was too big, that he forfeited the deposit and that the defendants [respondents] should come and collect the D7H bulldozer:
Paragraph 7 of the Second Cross Action by Counterclaim is to similar effect. There is no mention in these pleas of the Allbut D7 being inadequate or lacking power or Mr Allbut offering to send a mechanic to fix the machine or to arrange the rake to be cut down.
The respondents submitted that the fifth defence and second cross action did not require a reference to the matters that I have identified above. I disagree. The central issue in the case was the Allbut D7’s lack of power.
In paragraph 17 of the Second Statement of Claim, the applicant pleaded in detail the conversation of the 23 May 2016 including referring to the lack of power of the Allbut D7 and the failure of Mr Allbut to offer to repair the bulldozer. In these circumstances, it would be expected that the respondents would respond by specifically pleading that the respondents offered to repair the bulldozer, but that offer was rejected. This is the critical aspect, from the respondents’ point of view, of the 23 May 2016 conversation. Similarly, on the respondents’ case, it is a critical part of the alleged repudiation by the applicant. The fact that it was not mentioned in the fifth defence or second counterclaim suggests to me that the topic of the offer of repair and the refusal of Mr Cole to accept this offer was of recent invention.
The respondents submitted that I should make a similar finding of inconsistency between Mr Cole’s evidence and paragraph [17] of the Second Statement of Claim. I do not accept this submission. In broad terms, I find that Mr Cole’s evidence was consistent with that plea.
Fifthly, I accept the submission of the applicant that Mr Allbut’s evidence was formulaic and rehearsed. Mr Allbut generally had a very poor recollection of other events or conversations, but he was able to recount this conversation perfectly. For example, he was not able to recount his conversations with Mr Hyde on the same day with the same degree of accuracy or even initially recall how many conversations there were. He was unable to recount many other aspects of his business dealings which it might be expected that he would have been able to recount, for example whether he owned a prime mover in 2016 at the commencement of the business of Matrix, he had “no clue” of the interest rate he was paying in 2016, he did not recall reading the cross-action of the respondent and could not satisfactorily explain why he used the wrong ABN on the invoices and other written material of Matrix Agriculture in 2016, corrected it on one document on 12 May 2016, but did not correct it on subsequent documentation. Similarly, he was unable to recount many personal details, for example, his wife’s birthday or date of birth of his second child or the price which his house sold for 12 months ago, suggesting a generally unreliable memory.
The respondents submitted that I should consider as relevant and important the lack of a diary entry by Mr Cole of the conversation held on 23 May 2016. There is a reference to the lack of power of the Allbut D7, but no reference to the telephone conversation. The respondents submitted that, on the applicant’s version, the conversation was sufficiently important to warrant recording. There is some force in that submission, but the conversation was also important if it was in the terms given by Mr Allbut in his evidence such that it would warrant recording by Mr Cole. There is no doubt that the conversation occurred, both parties giving evidence of it and the records of Telstra providing independent confirmation. Mr Cole’s diary did not record every event or conversation. Mr Allbut did not make a written record of the conversation. In these circumstances, I do not consider that the absence of the diary note of the conversation provides any reason to reject Mr Cole’s evidence.
For these reasons, I find that in the 23 May telephone conversation Mr Cole complained about the lack of power of the Allbut D7, that Mr Allbut did not offer to repair that bulldozer and that after Mr Allbut had said words to the effect “that’s as good as it gets”, that Mr Cole said that if that is as good as it gets, then it was no good to him.

The applicant submitted, as an alternative, that if I could not make a definitive finding in relation to the 23 May 2016 telephone conversation between Mr Cole and Mr Allbut, I might find that neither party had committed to a course of conduct and that neither party had asserted a position in relation to the future conduct of the matter. As I have accepted Mr Cole’s version of the 23 May 2016 telephone conversation, it follows that I have not concluded that there was no resolution in that conversation as to what would happen in relation to the hiring. The consequence of the 23 May 2016 telephone conversation was that Mr Cole made the bulldozer available for collection and Mr Allbut took steps to arrange for the collection of the bulldozer and the rake.
Following this conversation with Mr Cole, Mr Allbut had two telephone conversations with Mr Hyde on 23 May 2016 to arrange for the collection of the Allbut D7 and the rake. In the first of these conversations, Mr Hyde agreed to collect the rake, but said that he did not want to collect the Allbut D7 because of the steepness of the road into the property. Mr Allbut recalls that he had a further telephone conversation with Mr Hyde about arranging for a third party to collect the Allbut D7. In this latter conversation, Mr Allbut gave evidence that:[11]
it was discussed that he [Mr Hyde] would take the machine free of charge and give it a go for me and let me know if he thought there was any problems. He then discussed that with his business partner to make sure that was okay.
Mr Allbut said that in this conversation, Mr Hyde expressed an interest in hiring the Allbut D7. Mr Allbut then sent an email to Mr Hyde at 10.18pm on 23 May 2016 in relation to the proposed hire.
[11] T386.
Mr Cole gave evidence that he received a text from Mr Allbut to say that Mr Hyde would be collecting the rake the next day, that is 24 May 2016. Mr Allbut could not recall sending that text. I accept Mr Cole’s evidence on this point. It is likely and indeed necessary that some arrangements would have needed to be made with Mr Cole about the collection of the rake.
There were limited communications between the applicant and respondents following the return of the Allbut D7. On 25 May 2016, Ms Parkinson on behalf of the applicant, sent an email to Mr Allbut complaining inter alia about the lack of power, the re-hiring of the bulldozer (see below), asking for the repayment of the deposit/rent paid in advance and stating that the applicant had been left “high and dry” by the inability of the Allbut D7 to perform the required task. The email is consistent with the applicant’s position. Ms Allbut responded on behalf of the respondents on 2 June 2016, advising that Mr Allbut was at a mine site in Western Australia, but that she had spoken to him and he said that he agreed with Mr Cole that the deposit was forfeited. Again, that was consistent with Mr Allbut’s evidence.
Collection of the Allbut D7 and rake
Mr Hyde attended at the Jamberoo Property on 24 May 2016. During the process of loading the rake, Mr Hyde and Mr Cole had a discussion. There was no dispute that Mr Hyde advised Mr Cole that he was not collecting the Allbut D7 as the road into the property was too steep and that he would arrange to get someone else to collect the machine. What is in dispute is the remainder of that conversation.
Mr Cole gave evidence that Mr Hyde told him that he had hired the machine off Mr Allbut at $75.00 per hour and was taking it to Coolabah in western New South Wales.
Mr Hyde’s evidence was that he did not say to Mr Cole at this time that he was hiring the Allbut D7 or therefore that he was paying $75.00 per hour for the hire. Mr Hyde gave evidence that it was some time later that he had a conversation with Mr Cole in which he advised him that he was hiring the Allbut D7 for $75.00 per hour. This conversation, which is discussed below, occurred in the context of Mr Cole making an inquiry into the hiring of a bulldozer, which, unknown to Mr Cole, happened to be the Allbut D7, which, at that time, Mr Hyde was hiring. Mr Hyde gave evidence that his advice to Mr Cole that he, Mr Hyde was hiring the Allbut D7 machine from Mr Allbut at the rate of $75.00 per hour was false. He said people often ask him at what rate he is hiring and he finds such questioning about his business dealings offensive. In response, he tells them random figures. In this case, Mr Hyde says that he just plucked the figure of $75.00 per hour.
Mr Hyde did ultimately concede that “anything is possible” when repeatedly asked in cross-examination whether it was possible that he had told Mr Cole in the conversation on 24 May 2016 about hiring the machine for $75.00 per hour from Mr Allbut. However, his clear evidence was that the conversation about the $75.00 per hour occurred on the latter date and not on 24 May 2016.
On 25 May 2016, Ms Parkinson, sent an email on behalf of the applicant to Mr Allbut complaining about the Allbut D7 and its lack of power. In that email, Ms Parkinson stated:
Given that you apparently already have this machine hired out again at a lucrative rate….
This information can only have come from Mr Hyde. In these circumstances, I find that Mr Hyde did in fact refer to the fact that he was hiring from Mr Allbut the Allbut D7 at the rate of $75.00 per hour (which would be a lucrative rate in the view of Ms Parkinson). I do not consider that any adverse credit finding can be made against Mr Cole in relation to this matter.
The Allbut D7 was ultimately taken by a third-party contractor to Walcha where it was collected by Mr Hyde. On 2 June 2016, Mr Hyde took the Allbut D7 to his workshop in Coolabah.
Upon inspection at the workshop, Mr Hyde found that one of the injectors was leaking because of a failed seal. That injector and the other five injectors were also worn. Mr Hyde replaced all six injectors. Mr Hyde accepted that the faulty injector would cause a significant power reduction.
Mr Hyde ultimately hired the Allbut D7 from Mr Allbut for about two and half years at the rate of $55.00 per hour.
Contract between the applicant and KPI in relation to the Urbenville Properties
Following some discussions between Mr Cole and Ms Parkinson on behalf of the applicant and Mr Elgin and Mr Rankine on behalf of KPI, by email dated 21 April 2016 KPI invited the applicant to quote for the clearing of the Urbenville Properties. The email invited the applicant to quote for the chaining, raking and burning of the properties. Later, KPI did not require burning.
By email dated 3 May 2016, the applicant provided a quotation for the work at Urbenville. The email stated that the applicant expected to be able to commence the work on 1 July 2016 and anticipated completing the work by March/April 2017. The quotation itself provided a proposed start date of 1 July 2016, using two machines with others to follow as they became available from Yarrowitch. The quotation provided rates of $100 per hectare for chaining, $320 per hectare for raking and $80 per hectare for burning.
On 3 June 2016, Mr Rankine on behalf of KPI sent an email to Ms Parkinson in which KPI accepted the quotation of the applicant and stated that they would like the applicant to commence work at Urbenville on the proposed start date of 1 July 2016. The email also stated that KPI would send to the applicant a KPI Contractor Engagement Record which needed to be signed before the work commenced.
KPI sent a Contractor Engagement Record to the applicant which the applicant and KPI respectively signed on 20 June 2016 and 21 June 2016. The Contractor Engagement Record specified the start date as “after 1/7/2016 (or near date as advised by contractor) and end date Approximately April 2017”.
Enquires by the applicant for hiring or purchasing other bulldozers
Mr Cole gave evidence that following the return of the Allbut D7, he contacted the owner of the Dry Hire Online website and sought his assistance in obtaining a replacement bulldozer. Mr Cole also gave evidence that he made “dozens” of phone calls without success.
Mr Cole said that there were a number of reasons why the applicant was unable to hire a replacement bulldozer. He said some potential owners were unwilling to hire at the rate the applicant wanted. Some bulldozers were unsuitable as they did not have the scrub canopy. Some owners were not willing to hire because the applicant was too far away. Mr Cole said that when the applicant took on the contract with KPI for the clearance of the Yarrowitch Properties, it set a ceiling of $50 per hour for the hire of bulldozers. Mr Cole said that there were some bulldozers available at double that price, but the applicant could not afford to pay that amount.
The respondents did not seriously challenge Mr Cole’s evidence about his unsuccessful attempts to hire a replacement bulldozer for the Allbut D7. The respondents did not adduce any evidence that other bulldozers were available for hire by the applicant. The respondents did not adduce evidence or make any submissions that the applicant could have afforded to pay a price for hire greater than $50 per hour. The respondents did not dispute that Mr Cole had made the enquiries or that those enquiries were not successful in locating a bulldozer that met the criteria required by the applicant.
In these circumstances, I find that the applicant made numerous attempts, following the return of the Allbut D7 on 24 May 2016, to hire a replacement bulldozer, without success. The applicant was unsuccessful for a variety of reasons including the price of hire, lack of canopy and the location of the proposed hire.
From at least mid-May 2016 (and prior to the delivery of the Allbut D7) the applicant had begun to make enquiries in relation to the purchase of a further bulldozer. It could only do so by borrowing the full amount of the purchase price from its bank, the Commonwealth Bank. In its loan application, the applicant relied upon its contracts with KPI to clear the Yarrowitch and Urbenville Properties.
The applicant obtained finance from the Commonwealth Bank and settled on 22 July 2016 when it purchased a Komatsu K85 plus rake and canopy from Wanless (the Ironwill K85) for the sum of $281,600.00. On 4 July 2016, the applicant had also purchased, using funds borrowed from the Commonwealth Bank, a Freightliner Prime Mover in the sum of $78,000.00 and on 8 July 2016 a Drake Low Loader in the sum of $184,250.00. These machines were needed as the Urbenville Properties were spread out over about 50km and the bulldozers had to be moved between these properties by road on the prime mover and low loader. By contrast, at Yarrowitch, the bulldozer could move between the Yarrobindi and Jamberoo properties by simply crossing the boundary between these properties.
The applicant took possession of the Ironwill K85 on about 22 July 2016 and put the machine to work at Urbenville. On 21 July 2016, it moved the Peart D6 to Urbenville so that it could undertake chaining at Urbenville. using both bulldozers. As I have held earlier in these Reasons, the Ironwill K85 had many mechanical problems, at least in the first few months.
Mr Cole gave evidence that at about the time of the purchase of the Ironwill K85, Wanless advised the applicant that it wanted the return of the Wanless K85. In fact, because of the on-going problems with the Ironwill K85, Wanless agreed to defer the return of the Wanless K85, at no charge to the applicant, but asked that the hours be kept down. The records of the applicant show that it did not pay any hire fee to Wanless for the hire of the Wanless K85 from 31 August 2016.
The Wanless K85 was moved to Urbenville on 22 August 2016 and ultimately was returned to Wanless on 2 November 2016.
The plan of the applicant at the time that it was negotiating with KPI in relation to the Urbenville Contract in May 2016 was to use two bulldozers at Urbenville for chaining and two bulldozers at Yarrowitch.
With the return of the Allbut D7, the applicant had only three machines, the Wanless K85, the Peart D6 and the Wanless K65. The Wanless K65 was only used at Yarrowitch and was returned to Wanless in August 2016. The Ironwill K85 became a fourth bulldozer, but at or about the time that this machine was purchased, Wanless had advised the applicant that it wanted the Wanless K85 returned. Therefore, the applicant had four machines from 21 July 2016 to August 2016 (when the Wanless K65 was returned) and then three machines from August 2016 to 2 November 2016 (when the Wanless K85 was returned) and thereafter two machines.
The applicant decided that it would not continue to work on both the Yarrowitch and the Urbenville Properties and on about 15 August 2016 relinquished the Yarrowitch contract with KPI. It appears that the cost of hiring and operating the bulldozers was a contributing factor. The applicant also expressed doubts about the profitability of the contract with KPI for the work at the Yarrowitch Properties, Mr Cole recording in his diary of 1 August 2016 “Yarrowitch is too cheap”. On 8 August 2016, Mr Cole recorded “No work Yarrowitch. To [sic] wet and we need to up our rate”. On 14 August 2016, Mr Cole recorded “Linda and I don’t think we can go on the job. The machine hire is killing us”. Lastly, on 15 August 2016, Mr Cole recorded “after much [sic], Linda and I decided to pull out. No money and to [sic] difficult to deal with C. Rankin”.
As a consequence of relinquishing the Yarrowitch Contract, the applicant returned the Wanless K65 to Wanless in August 2016. The work at Urbenville was undertaken by the Peart D6, the Wanless K85 (until it was returned to Wanless on about 2 November 2016) and the Ironwill K85. The Wanless K85 was used during the period from June to November 2016 while the Ironwill K85 underwent repairs.
The applicant rendered accounts to KPI for the work undertaken at Urbenville (and for the work at Yarrowitch to mid-August 2016) and continued with that work until 31 January 2017.
The Urbenville Contract ended on 31 January 2017 when the owners of the Urbenville Properties sold the properties. KPI had given the applicant about 30 days’ notice that the contract was going to end because of the sale of the properties.
Terms of the Contract between the applicant and the respondents
(i)Do the standard terms and conditions form part of the contract
The respondents contend that the contract between the applicant and the respondents for the hire of Allbut D7 included the standard terms and conditions of the respondents. The respondents submit that the applicant impliedly accepted those conditions in the following circumstances:
a.There had been negotiations between the applicant and the respondents about the terms and conditions. A second version of the draft terms and conditions was sent by the respondents to the applicant on 4 May 2016;
b.On 12 May 2016, the applicant sent an email to the respondents in which it set out its concerns with clauses of the terms and conditions. In this email, the applicant also expressed its preference for simple and straightforward standard terms and conditions such as the Wanless terms and conditions which it set out in that email;
c.On 12 May 2016, the respondents responded to that email and sent a third draft of the terms and conditions which addressed the concerns of the applicant. The terms and conditions provided for their execution by the parties. The email also advised that the respondents were willing to negotiate on the deposit, but required a minimum deposit of equivalent to 2 weeks at the 40-hour minimum hire rate;
d.On 19 May 2016, the respondents sent an email to the applicant attaching a revised deposit invoice. In the email, the respondents asked that the applicant “get back to me tomorrow morning with “delivery instructions and a signed copy of the agreement and remittance for the deposit”;
e.On 19 May 2016, the applicant paid the deposit to the applicant and by email to the respondents dated 20 May 2016 attached the banking records of the payment of the deposit;
f.It is also apparent that the applicant provided delivery instructions to the respondents as the respondents delivered the Allbut D7 to Jamberoo on about 22 May 2016;
g.The applicant did not return the signed terms and conditions, nor did it further advise the respondents about its position in relation to the terms and conditions; and
h.The applicant commenced using the Allbut D7 on 23 May 2016.
On the other hand, the applicant contended that it never agreed upon the terms and conditions; the terms and conditions required its signature which it never provided and that in its email of 12 May 2016 it had indicated its preference for simpler and more straight forward terms and conditions.
It is clear that the respondents had made an offer to the applicant to hire the Allbut D7 on the terms and conditions attached to its 12 May 2016 email and on payment of the deposit invoice attached to its 19 May 2016 email. The applicant did not expressly assent to the respondents’ offer; the issue for determination is whether it has impliedly assented by paying the deposit and providing delivery instructions. Alternatively, did the applicant make a counter offer by the payment of the deposit without signing and returning the terms and conditions?
In Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd,[12] Kirby P approached the question of implied assent in the following way:[13]
[T]he starting point for the legal classification of the facts which I have set out is that an offeror may not impose a contractual obligation upon an offeree by stating, that if the latter does not expressly reject the offer as made, it will be taken to have accepted it. The general principle is accepted throughout the common law world.
Kirby P went on to hold:[14]
However, in particular circumstances, the general rule has been seen to work an apparent injustice. Accordingly, courts have come to conclude that sometimes, out of some circumstances, an acceptance can be inferred, notwithstanding the absence of specific assent. Alternatively, in some circumstances, the law will provide an estoppel to preclude a party from denying the existence of a contract, even though special acceptance was not given and could not be inferred from the facts proved.
[12] (1988) 14 NSWLR 523.
[13] Ibid at 527.
[14] Ibid at 528.
There was no estoppel pleaded by the respondents nor did they contend that an estoppel arose.
The question of implied acceptance must be considered from an objective consideration of all the relevant facts and circumstances.[15] The present case does not fall into the categories of cases where an implied consent may be readily inferred, for example because of previous dealings between the parties or where a duty of candour might arise.[16] Kirby P in Empirnall determined the issue of implied acceptance by examining indicia of no assent to the printed contract (which was to be executed by the parties) and indicia of assent. In the former category included the following matters: the starting point that silence is not normally assent, the fact that the appellant did not sign contracts, the absence of any negotiations concerning the printed contract and the fact that printed agreement contained a number of blanks. On the other hand, the indicia of assent in that case outweighed these indicia. The indicia of assent were that the relationship between a developer and managing architect was a protracted arrangement involving a substantial project and large sums of money, the appellant had indicated that the printed contract would be fine, that the progress payments made over the whole course of dealings between the parties were compatible with the acceptance by the appellant of the printed contract and that it was only when financial difficulties arose that the appellant disavowed the printed contract.
[15] Id.
[16] Ibid at 528-529.

The applicant referred to the maintenance and repair issues with the Wanless K65 and the Peart D6 in the period to June 2016. An examination of the diary of Mr Cole does provide some evidence as to when those machines were unavailable. Mr Cole provided only general evidence about these matters. It is not possible to be precise about the repairs as Mr Cole’s diary does not purport to record the detail of all such matters and is often ambiguous.
The Peart D6 required an engine rebuild and the diary of Mr Cole notes that engine was taken to Wanless for this purpose on 13 January 2016 and returned on 21 January 2016 (8 days). The fuel pump on the Peart D6 failed on 26 January 2016 and a technician arrived from Westrac to repair the pump. A day appeared to be lost. On 17 February 2016, the Peart D6 was not operative because of the need for new filters (1 day). The diary of Mr Cole also records the radiator problems experienced by the Peart D6. The diary records that the Peart D6 broke down on 23 February 2016 and was repaired, after parts were obtained on 25 February 2016, but following that a hole occurred in the radiator which was repaired on 28 February 2016 (5 days). A further problem with the radiator on the Peart D6 occurred on 8/9 March (1 ½ days), 8-10 April (2 ½ days), 21 April 2016 and was repaired on 25 April 2016 (4 ½ days). From about 6 May 2016, the Peart D6 was also experiencing problems, was returned on 9 May 2016 and was then out of operation until 12 May 2016 (6 days) and 14 May-16 May (3 days), On 26 May 2016, the diary records that the radiator on the Peart D6 needed further repair and a new radiator was ordered. The Peart D6 was operative again on 1 June 2016 (6 days).
Mr Cole’s diary also records repairs to the Wanless K65 on 23 February and 24 February (2 days), 29 February 1 March (2 days), 19 March (1/2 day), between 24 March and 31 March (7 days) 5 May- 9 May (5 days). On 11 May 2016, the Wanless K65 was sent back to Wanless for further repairs. It is unclear from the diary how long it was not operational (say 1 day). The Wanless K65 was down in the period from 1 June -3 June (2 days).
The above evidence demonstrates that there were significant maintenance problems with the Peart D6 and Wanless K65. Adopting a broadbrush approach, the diary entries attribute a loss of about 55 machine days (ie the loss of one machine over 55 days).
In the period when work was undertaken at Urbenville, the applicant had ongoing problems with the Ironwill K85. These are recorded in entries in Mr Cole’s diary on 3 August 2016, 14 August 2016, 15 August 2016, 17 August 2018, (I note in the diary entry for this date it is recorded that 5 days had been lost to date because of the problems with the Ironwill K85), 21 August 2016 to 15 September 2016 (when it was ready for collection from Wanless, indicating a loss of a 25 days), 17 September - 27 September (it was redelivered to Wanless and picked up on 27 September 2016, a loss of further 10 days), 28 September 2016 (1 day), 3 October 2016 (returned to Wanless) and picked up on 15 October 2016 (further loss of 12 days), 11 November 2016 (1/2 day), 14 November 2016 (1/2 day), 16 November 2016 (1 day) and 18-19 November 2016 (1 day). In total about 56 days were lost because of the problems associated with the Ironwill K85.
There were also some, relatively minor, mechanical problems with the Peart D6 and the Wanless K85 when undertaking work at Urbenville. The Peart D6 had mechanical problems on 21 September 2016 (1/2 day), 10 November (1/2 day), 14 November (1/2 day). There were also problems with the Wanless K85 on 18-19 October 2016 (2 days) and on 21 October 2016 (1 day),
Taking all these matters into account, I would not make any adjustment because of mechanical breakdowns in the first part of 2016. A number of days were lost in performing the work at Yarrowitch in the first part of 2016 because of problems with the Peart D6 and the Wanless K65. However, there were also major problems with the Ironwill K85 which was used at Urbenville. An equivalent number of days were lost in the second half of 2016 because of mechanical problems with the machines.
Mr Opie had made an allowance of 6 days for maintenance at Urbenville (across 2 machines) in the period between 1 July 2016 and 31 January 2017. I would allow a similar time, 2 days (for each of the 3 machines) for maintenance in the period up to 31 May 2016.
Adjustment for dam building
The applicant also referred to dam building that it undertook for a third party, David Symonds in February 2016. The dam building diverted resources of the applicant from the KPI Contract and therefore, the applicant argues, less hectares were raked.
The dam building occurred, on Mr Cole’s evidence over a period of about 7-9 days and using one operator and therefore one machine. During that time, according to Mr Cole, the other machines continued to work on the Yarrowitch Properties.
The applicant submitted that the dam building in fact extended over a longer period and pointed to diary entries which arguably showed that the dam building took place over the period from 1 February 2016 to 16 February 2016. In particular, the applicant pointed to the entry in the diary for 16 February 2016 which stated, “Neil 9 hrs Finish Dam 2” and submitted that I should infer that the dam building finished on this day and that Neil had been continuously employed on dam building from 1 February 2016 to 16 February 2016.
The applicant could have adduced further evidence from Mr Cole in relation to the dam building by reference to the journal entries, but chose not to do so. However, I am prepared to infer that the dam building did take place from 1 February 2016 to 16 February 2016, using one operator and one machine. I am prepared to make that inference as I consider it likely that the bulldozer was used continuously in dam building until it was completed. It would make no sense to move the bulldozer from dam building to raking and back to dam building.
However, I am not prepared to accept that the time lost to raking from the dam building equated to 7.16 days, as the applicant submitted. The applicant’s logic in making that submission is inherently flawed. The applicant determined the number of hours spent by “Neil” (usually around 12-13 hours) on a given day raking and arrived at a figure of 193.5 hours and then divided that sum by 9 (being the number of hours in which raking would occur) to arrive at the total days lost by that operator. That sum is then divided by three to determine the overall number of days lost to raking (because there were three bulldozers used at Yarrowitch). The flaw in logic arises because the sum of 12-13 hours was used in determining the total hours lost by Neil, but only 9 hours was used to represent each day lost to raking (because raking was undertaken for 9 hours per day). The summation of the hours lost to raking should not exceed 9 hours per day as that, on average, is the maximum number of hours lost in any given day to raking. Using that number, a total of 144 hours were lost because of the dam building. Based on the 9 hours day and the use of three machines, that 144 hours equated to a loss of 5.33 days for each of the three machines (which could have been spent on raking) because of the dam building.
Adjustment for burning
The applicant further submitted that I should find that the amount of time spent burning in the period up to 30 June 2016 equated to the amount of time raking. The applicant did not adduce any evidence from Mr Cole or any other witness as to the rate of burning. The minimal evidence adduced from Mr Cole on this topic does not support the submission of the applicant. The applicant then asks me to infer that burning took as long as raking from the journal entries of Mr Cole and the invoices rendered by the applicant to KPI where the work is recorded.
I do not consider that the diary entries and invoices support the submission of the applicant. Although I accept that Mr Cole was not attempting to provide a complete and accurate record of the hours spent on an activity, in the absence of any other evidence as to the burning rate and time spent in burning, I am not prepared to accept that the time spent burning was greater than that indicated in the diary or the invoice. It was within the power of the applicant to adduce specific evidence about the rate of burning, but it did not do so. The diary entries are often ambiguous or unclear and Mr Cole was not taken to them to provide an explanation or elaboration.
Mr Cole in his evidence described the burning process. The heaps of timber were raked into piles, then burnt and then pushed into the next heap where the process was repeated. The ashes were ultimately buried. Mr Cole said:[89]
Also, when the heaps burn down, if you light in the evening, when traditionally most of the times you do, you light your heaps in the evening by the time, 10, 12, 14 hours pass, the next day those heaps are lower to the ground because there’s not as much ash and you can handle them with the w[r]ake to push them into the next heap, so you can push heaps-into heap, into heap and gradually you eliminate the amount of sticks that are left behind and coals and all that sort of thing, So it becomes more efficient, much more efficient, and much, much quicker.
[89] T88.
Mr Cole did not give any other evidence about the time spent burning.
In support of its submission that the time spent burning equated with the time spent raking, the applicant submitted that the diary of Mr Cole recorded the hours spent on burning. Given the time spent burning, the applicant submitted that the time spent raking at Yarrowitch was in fact less and therefore the rate of raking was higher.
The applicant helpfully prepared the following table which addressed the hours it says were spent burning. The claimed hours should be adjusted to the daily maximum hours spent raking, 9 hours per day, as that is the amount of time lost to raking. I have added the last 2 columns on the table to reflect my findings in relation to the diary entries and why the adjustment should be made to reflect the time lost to raking and therefore determining the raking rate.

Date (2016)

Activity

Hours

Adjusted Hours

Reason for Adjustment

1 February

Derek 12 hrs cleaning up fires

12

9

Maximum time lost to raking

Pre - 1 February As per item 1, Derek had spent 12 hours on 1 Feb "cleaning up fires". Time must therefore have been spent pre 1 Feb on burning activities. Allow at least an equivalent amount. 12 (est) 9 Maximum time lost to raking

3 March

Neil and Derek "lighting fires for the day", 12 hours each

24

18

Maximum time lost to raking

4 March Derek, Neil, Linda and James "Burning at Yarrobindi till 1:00pm", say 6 hours x 4 people 24 18 Linda was the spouse of Mr Cole so her time did not represent time lost to raking. Therefore, allow only 3 operators, 6 hours each.

5 March "Back to cleaning up fires 85 & D6R", 13 ½ hours each for Neil and Derek 27 18 Maximum time lost to raking

6 March

Ditto as per item 5 [the previous item]

27

18

Maximum time lost to raking

7 March

Neil, Derek and Kelvin spending 12 ½ hours each on “Fires”

37.5

27

Maximum time lost to raking

14 March

"Started to light fires" after "lunch". This would appear to be a reference to Derek, Kelvin and James, i.e. 5 hours x 3 people

15

-

The entry goes on to record that started to light fire. Rained off. The time lost was caused by rain and not burning. Allowed ½ day as rain loss.

16 March James Cole "lit fires in quarry paddock". Assume 11 hours, being the time spent by each of Steve and Kelvin that same day 11 (est) 9 Maximum time lost to raking

31 March "Neil & Steve fires all day. Had trouble with grass fires." Diary shows 12 ½ hours each 24 18 Maximum time lost to raking

1 April

Ditto as per item 9 [16 March]

24

18

Maximum time lost to raking.

2 April

"Worried about blade grass and fires on both places. I think firebreaks will be definitely needed..."

n/a

7 April

James Cole had a "Good day burning with Neil. Not much left to burn [on Yarrobindi], less than a day. Approx. 3 to 4 days cleaning up fires. I hope." As Neil spent 11 hours on fires, assume the same for Mr Cole i.e. 2 x 11 hours

22

-

The diary entry shows that each of Steve, Kelvin and Hayden worked, but not on fires. Therefore, there was no time lost to fires.

8 - 11 April inclusive
As per the estimates in item 12 [7 April], allow a further day's burning, and say 3 days cleaning up fires, for each of Mr Cole and Neil, i.e.

A total of 4 days x 11 hours each x 2 people
88 36 The diary entry shows that each of Steve, Kelvin and Hayden were working during this period as well as Neil and Mr Cole. Therefore, at most one operator could be said to be lost to raking during this period. Allow 9 hours per day for the 4 days

12 April "Picked up fire truck from Pickles Tamworth.
Have to re-engineer tanks and fittings." n/a

13 April "Hopefully with the use of some fire breaks we can contain the fires." n/a

15 April

"Neil and I travel to T/Worth for parts. Had Kelvin, Steve, Hayden working on fire truck

& buggy & fuel trailer. Finished at 4:30pm." All time entries appear to relate to fire truck and related work. 5 people (including Mr Cote) at 8 ½ hours each.

42.5

-

The diary entry records rain on 15 April and have allowed a full day to rain. To allow burning as well would cause duplication.

16 April
Kelvin & Neil fire truck compressor and generator, fuel trailer." 10 hours recorded for each. 20 - The diary entry does not record any burning activity. Have allowed a day off because no work undertaken. To allow burning as well, would cause duplication.
.

30 April
"Boys went off to light fires about 2:00pm"

Say 4 hours each
8 (est) 8 No adjustment

2 May

"Fire truck sorted". Hayden, Kelvin and Neil, each 10 hours.

30

15

The diary entry goes on to say “started raking”. The diary entry does not record any time spent on burning Allow half burning and ½ raking.

4 May
"Neil burning fires this arvo. Plenty to go."

10 hours is recorded for Neil working on

"tools & burning." Say 5 hours for burning
5 (est) 5 No adjustment.

5 May "Neil 10 ½ Hrs Repairs & Fires". Say 6 hours for burning. 6 (est) 6 No adjustment

6 – 8 May inclusive

The diary for these days records Neil spending another 10 ½ hours each day. It is
unclear if this work still related to burning. Allow say 5 hours for each for burning

15 (est)

-

The diary entry does not provide any evidence of the activity undertaken on these days. Diary does not suggest raking or burning be undertaken but problems with machines and employees taking days off. There have allowed these days as days off. To allow for burning, would cause duplication.

24 May

"Bury heaps 5 hours" and "Burning heaps and wind gusty and quite strong at times. Had to put a break in to contain fire." In total 30 hours were recorded, but some time seems to relate to other activities. Allow say 20 hours for burning activities.

20

20

No adjustment

30 May

"Charlie Rankin arrived and he and I toured Yarrobindi for heaps that need pushing and bury. He held back our cheque till he says it is done." Subsequent entries show this took 55 hours (see 2/6 [bury heaps 85-6 hours], 3/6 [bury heaps 85-5 hours], 13/6 [85 bury heaps 4 hours], 14/6 [Bury heaps-4 hours], 15/6 [Bury heaps-4 hours], 16/6 [Bury heaps 6 hours], 30/6 [bury heaps 4 hours] and 1/7 [bury heaps all day-say 9 hours]

55

42

Adjusted for actual hours recorded

Total:

516 (on the applicant’s calculations but in fact 549 hours

294 (to 3 July 2016) or 252 hours to 31 May 2016

The above table demonstrates that until the end of June 2016 a total of 294 hours can be shown to have been spent on burning activities. That equates to a total of 10.88 days were spent on burning (assuming the 3 machines and 9 hours per day) and lost to raking. Until the end of May 2016, that equated to a loss of a total of 9.33 days.
The above analysis is not a precise determination of the number of hours spent on burning. However, it shows two things; first, that the time spent burning could not be equated with the time spent raking and secondly, the applicant had only established on the evidence the loss of the days referred to above due to burning.
Adjustment for rain and days of or no work
In the period from 1 July to 31 January 2017, Mr Opie excluded some 22 days (because of rain) and 10 days (because of holidays over the Christmas break) from the days when work could be undertaken at Urbenville.
It is also appropriate that adjustments be made for rain and days off or no work being undertaken at Yarrowitch when calculating the number of days over which raking occurred at Yarrowitch.
The applicant did not make any submissions on the number of days lost for rain, days off or no work at Yarrowitch. The applicant did not adduce any evidence on this topic.
The diary of Mr Cole records a number of days in which there was rain and no work undertaken. On some other occasions, the notation “day off” appears in the diary and it is unclear whether the day off was for rain or for some other reason. In any event, no raking was undertaken on these days and it is appropriate that when calculating the raking rate that those days are excluded. There are also some days where it appears from the diary entry that no raking work was undertaken for some other reason and it is appropriate that when calculating the raking rate that those days are also excluded.
I therefore consider that it is appropriate in calculating the rate of raking at Yarrowitch to exclude from the time in which raking occurred:
a.The days marked “Rain” (where no work was undertaken): 28 January, 14 March (1/2 day), 21 March, 15 Apr, 4 June, 5 June, 20 June, 21 June, 22 June and 23 June;
b.The days marked “Day Off” or the diary otherwise records that no time was spent raking or burning: 31 January, 27 February (1/2 day), 28 February, 13 Mar (1/3 rd), 15 March, 20 March, 24 March, 25 March (1/3rd day), 26 March (1/3rd day), 27 March (1/3rd. day), 28 March (1/3rd. day), 29 March (1/3rd day), 30 March (1/3 day), 3 April, 4 April, 5 April, 6 April, 16 April, 17 April, 1 May, 6 May, 7 May, 8 May, 9 May, 10 May, 11 May, 14 May (2/3rds day), 15 May (2/3rds day), 28 May, 29 May, 17 June (1/3 day), 19 June, 24 June, 25 June, 26 June, 27 June (2/3rds day), 3 July 91 day).
To 3 July 2016 in total, 9 ½ days were lost to rain and 30 1/6 ths days were taken off or no raking or burning activity undertaken.
In the period from 1 February 2016 to 3 July 2016, 8 ½ days were lost to rain and 29 1/6ths days to days off or no raking and burning activity undertaken.
In the period 1 February 2016 to the end of May 2016, 2 ½ days were lost to rain and 23 1/6 ths days to days off or no activity spent raking or burning.
Calculation of rates of raking
The applicant did not perform a calculation of the effect of the adjustments, but submitted in a broadbrush way that they justified a finding of a raking rate of 3.611 hectares per day per machine.
Although any calculation is imprecise, because the raw data is ambiguous, in my view it is necessary to undertake a calculation of the effect of the adjustments to determine a raking rate.
Over the period from 1 February 2016 to 3 July 2016, a period of 154 days, a total of 884.32 hectares were raked. Allowing the 2 days for maintenance, the 5.33 days spent on dam building, the 10.88 days spent burning and the 37 4/6^th days when no work was undertaken, this raking was performed over 98.12 days or equating to 3.00 hectares per machine per day for each of the 3 machines used.
Over the period from 1 February 2016 to 31 May 2016, a period of 121 days, a total of 836.43 hectares were raked. Allowing the 2 days for maintenance, the 5.33 days spent on dam building, the 9.33 days spent burning and the 25 2/3 rds days when no work was undertaken, this raking was performed over 78.67 days or equating to 3.55 hectares per machine per day for each of the machines used.

The rate of raking can also be ascertained from the invoices where the only activity recorded in the invoice (over the 14-day period of the invoice) related to raking. These invoices comprise:
a.18.1.16 (Yarrowitch) (2 machines only)-106.14 hectares raked-3.79 hectares per machine per day;
b.2.2.16 (Yarrowitch)(3 machines for most of period, but excluding 28 January and 31 January when there was rain or day off)- 116.99 hectares raked-3.25 hectares per machine per day;
c.2.3.16 (3 machines, but excluding 1 ½ days of no work on 27 February (1/2 day) and 28 February)- 154.7 hectares raked 4.12 ha per machine per day;
d.1.8.16 (Urbenville)- 38.79 hectares raked. However, that raking does not provide any information about the rate of raking as the diary records that in the 14-day period of the invoice, the predominant activity was chaining, which was billed on 12 August 2016;
e.15.10.16-(Urbenville) (2 machines as Ironwill K85 being repaired for most of the period) - 133.94 hectares- 4.78 hectares per machine per day;
f.31.10.16 –(Urbenville)-(3 machines, except for mechanical problems with Wanless K85 on 18 October 2016 and 21 October 2016) (exclude 1 day in total)- 114.43 hectares raked ;
g.2.93 hectares per machine per day;
h.15.11.16-(Urbenville)-2 machines-Wanless K85 was returned on 2 November 2016)- 68.89 hectares-but because of rain and machine breakdowns that work was carried out over 11 days- 3.13 hectares per machine per day;
i.30.11.16 -(Urbenville)-2 machines-72.51 hectares-but because of machine breakdowns, work was carried out over 12 days- 3.02 hectares per day;
j.18.12.16-(Urbenville)-2 machines- 97.09 hectares- 3.47 hectares per machine per day;
k.30.01.17-(Urbenville)-2 machines- 37.69 hectares- 1.35 hectares per machine per day. This last invoice can be disregarded as it is abnormally low and at a time when the work being undertaken by the applicant at Urbenville was finishing up.
The above invoices (excluding the invoices of 1 August 2016 and 30 January 2017 for the reasons expressed above) demonstrate an average rate of raking of 3.56 hectares per machine per day. I accept also that the other invoices where more than one activity is recorded may suggest a different rate.
Whether the rate of raking is determined by an overall analysis of the amount raked, adjusted for days when no raking was undertaken (for whatever reasons) or from the invoices where raking was the only activity, a determination of the rate of raking is not a matter that can be determined precisely.
I find that based on the above analysis that the applicant, if it had the use of a functional Allbut D7, the applicant would have raked at Urbenville about 3.5 hectares per day per machine.
This raking rake of 3.5 hectares per day is confirmed by:
a.The fact that a gross profit of $136,804 was in fact derived in the period from 1 June 2016. The applicant therefore submitted (in support of its contention for a raking rate of 3.611 hectares per day) that the contract was profitable and therefore raking rates of 2.75 and 3 hectares per day, which on Mr Opie’s calculations resulted in a loss, (with a chaining rate of 30 hectares per day) of $123,152 and $62,006 respectively did not accord with the actual performance of the work;
b.The fact that a gross profit of $136,804 was derived from 1 June 2016 and assuming that 3 machines contributed to that profit, that indicates each machine contributed $45,601 to the profit. The applicant submitted that the Allbut D7 would have contributed no less than that amount, but in fact would have contributed more given the synergies and advantages of having 4 machines performing the work at the one time.
The respondents submitted that the gross profit of $136,804 did not provide confirmation of the raking rate (at least in relation to the Urbenville raking) for the following reasons:
a.First, the respondent submitted that the actual gross profit of $136,804 was inflated because from August 2016, rent was not charged on the Wanless K85. Therefore, the work undertaken from 1 June 2016 was not profitable and therefore the raking rake of 3.611 was not correct;
b.Secondly, the calculation of the implicit contribution by each machine to profit was excessive because the actual profit would not have been achieved had the Allbut D7 been used. That is because the savings from the moratorium on the rent of the Wanless K85 would not have been made as the Wanless K85 would have been returned (had the Allbut D7 been available) when the Ironwill K85 was purchased.
The invoice from Wanless dated 31 August 2016 indicated that no rent was to be charged to the applicant for the hire of the Wanless K85 for the month of August 2016. No rent was charged for the months of September and October 2016. The Wanless K85 was returned on 2 November 2016. An analysis of the rent paid by the applicant for the hire of the Wanless K85 shows the following amounts were paid:
a.31 January 2016-$2970- 1 week only;
b.29 February 2016-$10,305- for February 2016;
c.31 March 2016-$8145- for March 2016;
d.30 April 2016-$6750- for April 2016;
e.31 May 2016-$6525- for May 2016;
f.30 June 2016-$4815- for June 2016;
g.31 July 2016-$3300- for July 2016.
These figures suggest an adjustment of about $20,000 ($6666 per month) should be made to the actual gross profit of $136,804 when considering the hypothetical profit contributed by each machine if the Allbut D7 was hired (instead of the Wanless K85). A further adjustment of about $12,000 (excluding days when the machine was not used because of weather or the Christmas break) should be made for the increased costs of about $90 per day of the Allbut D7 compared to the Wanless K85 (see paragraph [5.8] of the First Opie Report). I calculated that adjustment from the 31 May invoice from Wanless for the hire of the Wanless K65. That invoice was in the sum of $6525 and was for 145 hours of use of the machine. An equivalent use of the Allbut D7 would cause about an extra $1500 per month in hire costs to be incurred or $12,000 across 8 months. This revised hypothetical profit of about $104,000 equates to about $41,600 profit per machine (I have used 2.5 machines as the average number of machines used in this period given that the Ironwill K85 was not purchased until 21 July 2016 and Wanless K85 was returned on 2 November 2016.
This revised hypothetical profit of about $41,600 per machine demonstrates two matters. First, the low raking rates of 2.75 and 3 hectares per day which produces a loss are unrealistic. Secondly, it could be expected that the addition of the Allbut D7 would generate a profit of no less than $41,600 over the period from 1 June 2016 to the end of the project.
In fact, it would be expected that there would be certain synergies, particularly in relation to chaining from having 2 machines of equal power. Mr Cole gave evidence, which I accept, of the difficulties he experienced in using machines of different power when chaining at Urbenville and of the benefits of having four machines chaining at the same time.
Calculation of loss from rate of chaining and raking
Having determined an indicative rate of chaining and raking, the next step is determining the loss of income and the expenses that would have been incurred in the hypothetical situation that the Allbut D7 was hired throughout the period of the Urbenville Contract.
The reports of Mr Opie address this loss of profit.
As I have said, the Fourth Opie Report provides the most assistance in calculating the loss suffered by the applicant because of the repudiation of the contract by the respondents as the assumptions accord with my finding that work would commence at Urbenville on 1 July 2016 (with two machines) and the remaining two machines would move from Yarrowitch to Urbenville in mid-August 2016.
Mr Opie has performed a number of calculations determining the profit lost by the applicant through not having the Allbut D7 available for use. The various calculations are based on alternate chaining and raking rates.
Mr Opie calculated that using, a chaining rate of 30 hectares per day (CR2) and a raking rate of 3.611 hectares per day per machine (RR1) that with the addition of the Allbut D7, the applicant would have made a profit of $214,662 from 1 June 2016. In fact, from that date it made a profit of $136,804. Therefore, on these calculations, the applicant suffered a loss of profit in the sum of $77,858.
Alternatively, on the assumption of a chaining rate of 30 hectares per day and a raking rake of 3 hectares per day, the applicant would have made a profit of $74,798 from 1 June 2016. In fact, from that date it made a profit of $136,804. Therefore, on this calculation, the applicant did not suffer any loss by not having the Allbut D7 and in fact was substantially better off by some $62,006.
Mr Opie did not calculate the loss of profits if a raking rate of 3.5 hectares per day was used. However, given the calculations that he did make, it would appear that a raking rate of 3.5 hectares per day, when used in conjunction with a chaining rate of 30 hectares per day, would have resulted in the applicant obtaining a further profit of about $50,000-$53,000 if it had the use of the Allbut D7 in the period between 1 June 2016 and 31 January 2017.
Alternative way of calculating loss by reference to gross profit per machine
The alternative way of calculating the loss of profit was made by Mr Opie in his Second Report. In this report, Mr Opie calculates the gross profit obtained from the use of each machine. The addition of the Allbut D7 could be expected to generate at least the same gross profit.
I have already referred to the calculation of the gross profit in the period from 1 June 2016 to 31 January 2017 in the sum of $41,600 per machine (after making deductions for the extra hire and running costs of having the Allbut D7 instead of the Wanless K65).
Mr Opie also calculated that:
a.In the 6-month period, from 1 February 2016 to 31 July 2016, the applicant generated revenue of $376,000 when operating three dozers. That equated to a revenue per machine of $127,333 or $21,000 per month during that six-month period. Applying a gross profit percentage of 32% to this revenue (which Mr Opie calculated), this equated to a gross profit per machine of $40,746.66 over the six-month period or $6971.11 per month. Over the eight-month period from 1 June 2016 to 31 January 2017 (when the Allbut D7 would have hypothetically been used), the gross profit that would have been derived from the Allbut D7 was $54,328.88 if that profit per machine was used.
b. From 1 August 2016 to 31 January 2017, the applicant generated revenue of $312,000. An adjustment of about $32,000 should be made to this figure because of the additional costs associated with the hire and operation of the Allbut D7 (being the $20,000 for the moratorium on hire costs and the $12,000 extra costs of being the Allbut D7). Applying 2.5 machines per month (rather than the 2 machines used- by Mr Opie as the Wanless K85 was used until November 2016), this equated to a profit per month of $18,666 per machine. Applying a gross profit percentage of 32% to this revenue this equates to a profit per machine of $35,838 over that 6-month period. Over the 8-month period from 1 June 2016 to 31 January 2017 (when the Allbut D7 would have hypothetically been used), the profit that would have been derived from the Allbut D7 was $47,778.
Conclusion re loss
The analysis of loss undertaken in the various ways suggest that the applicant sustained loss by not having the Allbut D7 as follows:
a.If loss was calculated by reference to a raking rate of 3.5 hectares per day per machine in accordance with the overall rate of raking at Yarrowitch, as adjusted, the applicant has sustained a loss of about $50,000 - $53,000;
b.If loss was calculated by refence to the gross profit achieved in the period from 1 June 2016 to 31 January 2017 (being the period when the Allbut D7 would have been available) with adjustments for matters submitted by the respondent, the applicant has sustained a loss of $41,600;
c.If loss was calculated by reference to the gross profit achieved in the period from 1 February 2016 to 31 July 2016, the applicant has sustained a loss of $54,328 over the 8-month period in which the Allbut D7 would have been available;
d.If loss was calculated by refence to the gross profit achieved in the period from 1 August 2016 to 31 January 2017, the applicant has sustained a loss $47,778 over the 8-month period in which the Allbut D7 would have been available.
The alternative ways in which the loss of profit suffered by the applicant range might be calculated show a range of loss between about $41,600 to $54,328 by not having the Allbut D7. I accept that this does not take into account the synergy that might have existed by having 2 machines of similar power, particularly when chaining. However, that synergy would not have been available when the Ironwill K85 was being repaired and the applicant has not adduced any evidence as to how that sum should be calculated. I am therefore prepared only to allow a modest sum for this synergy.
Based on the gross profit set out in sub-paragraphs (b) - (d) above, I will award damages in the sum of $50,000 to the applicant. This sum is exclusive of GST. I consider that the alternative ways of calculating loss provide support for this conclusion. In particular, given the uncertainty of determining the rates of raking and the conditions that existed when work was being performed at Yarrowitch, I consider that the best evidence of loss is obtained from the determination of the gross profit achieved by the applicant in the period from 1 June 2016 to 31 January 2017 per machine, adjusted, as submitted by the respondent, for the increased costs of hiring the Allbut D7 instead of the Wanless K85 but also providing for a modest allowance for the synergies of chaining with two machines of equal power..
Respondents’ counterclaim
As a consequence of my findings in relation to repudiation of the contract, the respondents’ counterclaim does not arise.
However, had it been necessary, I would have made the following findings.
The respondents have claimed the sum of $49,754,10 being the loss of income that it would have derived had the contract been performed. I would have accepted that claim as the expectation loss suffered by the respondents.
I would not have accepted the freight, repair and service and maintenance costs. These are costs that the respondents would have incurred in any event had the contract been performed. They are not wasted expenditure such that they could give rise to a claim for reliance damages. They are costs that would have been incurred in earning the loss of income that has been claimed. Insofar as the freight costs relate to costs incurred following the termination of the contract, the contract between the applicant and the respondents did not require the applicant to pay for the return freight. The costs therefore would have been incurred in any event.
Conclusion
I find that the applicant is entitled to judgment in its favour in the sum of $50,000 (before interest and exclusive of GST).
The counterclaim of the respondents is dismissed.
I will hear the parties on the questions of GST interest and costs.

Date (2016)	Activity	Hours	Adjusted Hours	Reason for Adjustment
1 February	Derek 12 hrs cleaning up fires	12	9	Maximum time lost to raking
Pre - 1 February	As per item 1, Derek had spent 12 hours on 1 Feb "cleaning up fires". Time must therefore have been spent pre 1 Feb on burning activities. Allow at least an equivalent amount.	12 (est)	9	Maximum time lost to raking
3 March	Neil and Derek "lighting fires for the day", 12 hours each	24	18	Maximum time lost to raking
4 March	Derek, Neil, Linda and James "Burning at Yarrobindi till 1:00pm", say 6 hours x 4 people	24	18	Linda was the spouse of Mr Cole so her time did not represent time lost to raking. Therefore, allow only 3 operators, 6 hours each.
5 March	"Back to cleaning up fires 85 & D6R", 13 ½ hours each for Neil and Derek	27	18	Maximum time lost to raking
6 March	Ditto as per item 5 [the previous item]	27	18	Maximum time lost to raking
7 March	Neil, Derek and Kelvin spending 12 ½ hours each on “Fires”	37.5	27	Maximum time lost to raking
14 March	"Started to light fires" after "lunch". This would appear to be a reference to Derek, Kelvin and James, i.e. 5 hours x 3 people	15	-	The entry goes on to record that started to light fire. Rained off. The time lost was caused by rain and not burning. Allowed ½ day as rain loss.
16 March	James Cole "lit fires in quarry paddock". Assume 11 hours, being the time spent by each of Steve and Kelvin that same day	11 (est)	9	Maximum time lost to raking
31 March	"Neil & Steve fires all day. Had trouble with grass fires." Diary shows 12 ½ hours each	24	18	Maximum time lost to raking
1 April	Ditto as per item 9 [16 March]	24	18	Maximum time lost to raking.
2 April	"Worried about blade grass and fires on both places. I think firebreaks will be definitely needed..."	n/a
7 April	James Cole had a "Good day burning with Neil. Not much left to burn [on Yarrobindi], less than a day. Approx. 3 to 4 days cleaning up fires. I hope." As Neil spent 11 hours on fires, assume the same for Mr Cole i.e. 2 x 11 hours	22	-	The diary entry shows that each of Steve, Kelvin and Hayden worked, but not on fires. Therefore, there was no time lost to fires.
8 - 11 April inclusive	As per the estimates in item 12 [7 April], allow a further day's burning, and say 3 days cleaning up fires, for each of Mr Cole and Neil, i.e. A total of 4 days x 11 hours each x 2 people	88	36	The diary entry shows that each of Steve, Kelvin and Hayden were working during this period as well as Neil and Mr Cole. Therefore, at most one operator could be said to be lost to raking during this period. Allow 9 hours per day for the 4 days
12 April	"Picked up fire truck from Pickles Tamworth. Have to re-engineer tanks and fittings."	n/a
13 April	"Hopefully with the use of some fire breaks we can contain the fires."	n/a
15 April	"Neil and I travel to T/Worth for parts. Had Kelvin, Steve, Hayden working on fire truck & buggy & fuel trailer. Finished at 4:30pm." All time entries appear to relate to fire truck and related work. 5 people (including Mr Cote) at 8 ½ hours each.	42.5	-	The diary entry records rain on 15 April and have allowed a full day to rain. To allow burning as well would cause duplication.
16 April	Kelvin & Neil fire truck compressor and generator, fuel trailer." 10 hours recorded for each.	20	-	The diary entry does not record any burning activity. Have allowed a day off because no work undertaken. To allow burning as well, would cause duplication. .
30 April	"Boys went off to light fires about 2:00pm" Say 4 hours each	8 (est)	8	No adjustment
2 May	"Fire truck sorted". Hayden, Kelvin and Neil, each 10 hours.	30	15	The diary entry goes on to say “started raking”. The diary entry does not record any time spent on burning Allow half burning and ½ raking.
4 May	"Neil burning fires this arvo. Plenty to go." 10 hours is recorded for Neil working on "tools & burning." Say 5 hours for burning	5 (est)	5	No adjustment.
5 May	"Neil 10 ½ Hrs Repairs & Fires". Say 6 hours for burning.	6 (est)	6	No adjustment
6 – 8 May inclusive	The diary for these days records Neil spending another 10 ½ hours each day. It is unclear if this work still related to burning. Allow say 5 hours for each for burning	15 (est)	-	The diary entry does not provide any evidence of the activity undertaken on these days. Diary does not suggest raking or burning be undertaken but problems with machines and employees taking days off. There have allowed these days as days off. To allow for burning, would cause duplication.
24 May	"Bury heaps 5 hours" and "Burning heaps and wind gusty and quite strong at times. Had to put a break in to contain fire." In total 30 hours were recorded, but some time seems to relate to other activities. Allow say 20 hours for burning activities.	20	20	No adjustment
30 May	"Charlie Rankin arrived and he and I toured Yarrobindi for heaps that need pushing and bury. He held back our cheque till he says it is done." Subsequent entries show this took 55 hours (see 2/6 [bury heaps 85-6 hours], 3/6 [bury heaps 85-5 hours], 13/6 [85 bury heaps 4 hours], 14/6 [Bury heaps-4 hours], 15/6 [Bury heaps-4 hours], 16/6 [Bury heaps 6 hours], 30/6 [bury heaps 4 hours] and 1/7 [bury heaps all day-say 9 hours]	55	42	Adjusted for actual hours recorded
Total:		516 (on the applicant’s calculations but in fact 549 hours	294 (to 3 July 2016) or 252 hours to 31 May 2016