Kubpower (New South Wales) P/L v Foxman and Sons (Australia) P/L

[1993] FCA 397

JUDGMENT No. .......,..,,.,.,..l 397 1493 ,,,,,,,,,,,,

J N THE FEDERAL COURT OF AU.WRIGIA	)
)

NEW SOU TH WALES DISTRICT REGISTRY ) No. NG 369 of 1993
)

BNERAL DIVISION 1

BETWEEN: KUBPOWER (NEW SOUTH WALES 1 PTY.

LIMITED (ACN 059 583 265)

Applicant

AND FOXMAN 5 SONS f AUSTRALIA) PTY.
LIMITED (ACN 052 515 974)

Respondent

Coram:	Whitlam J
Date:	15 June 1993
Place: Sydney	1 6 JUN 1993

FEDERAL COURT L.

PRINCIPAL REQISTRY

REASONS FOR JUDGMENT

(EX TEMPORE)

The applicant commenced this proceeding by ex parte application to Beaumont J last Wednesday afternoon. The applicant sought urgent relief in terms of a notice of motion dated 9 June 1993. Upon the applicant giving the usual undertaking as to damages, his Honour made an order in tens of paragraph 1 of the notice of motion up to and including last Friday. Procedural directions were also given to bring the matter back before the Court at 9.30 on that day.

Phillip Foxman, a director of the respondent, was also present	in court. The respondent's solicitor was unable to attend for
personal reasons and had evidently been unable to engage counsel overnight. Mr McKenzie indicated that the applicant now wished to obtain interlocutory relief in terms of a draft order which he handed up, which I have initialled and placed with the papers. Accordingly, I stood the matter over until 2.15pm so as to give the respondent an opportunity to obtain legal representation.
In the afternoon Mr G.P. Segal of counsel appeared for the respondent. W Segal informed me that he had only had

When the matter came before me last Friday morning m
J.R. McKenzie of counsel appeared for the applicant. Mr

!	!	about an hour over lunch to confer with Mr Foxman, that he did not consider he was prepared adequately to deal with the applicant's claim for interlocutory relief and that,
i	accordingly, he was instructed to seek an adjournment. Mr
I
McKenzie pressed for the determination of the applicant's claim for interlocutory relief. I refused the adjournment. At the conclusion of the hearing I postponed giving judgment so that Mr Segal could leave court for personal reasons (which he had indicated early in the afternoon that he would need to
undertaking as to damages, the respondent by its counsel gave do.) Upon the applicant giving once more the usual
an undertaking to refrain from the conduct described in paragraphs 1 and 2 of the notice of motion up until 12 noon today.
The applicant's substantive claim is for the contract price of repairs which it effected to the respondent's equipment. The equipment in question is a hammer used for breaking rocks. The respondent has recovered possession of this hammer. The applicant's claim for interlocutory relief is for the delivery up of the hammer to the applicant. Such relief, it is submitted, would be available to the applicant as final relief under ss 80 and 87 of the Trade Practices Act

in the nature of orders made in an action for detinue.

The hearing last Friday afternoon was necessarily fairly confined. Leaving aside the formal affidavits of service, the applicant's evidence consisted of an affidavit of Mr Angelo Di Cesare, the applicant's managing director, and an affidavit of Mr Mario Agius, the applicant's service manager. Mr Foxman gave evidence orally and was cross-examined.

The evidence may be shortly summarized. The hammer was evidently manufactured by a German firm called Krupp. The respondent purchased the hammer second-hand about three years ago and arranged for it to be serviced by Krupp at its Granville workshop. In March this year the respondent began

to use the hammer on a site in North Sydney where it performed	unsatisfactorily. The hammer was returned to Krupp for
further work after which it continued to fail.
On 1 April 1993 the applicant became the NSW dealer for Krupp equipment. It carried on its business from Krupprs old premises at Granville and evidently took over some of that firm's staff, including M r Agius. On about 30 April 1993 the respondent delivered its hammer to the Granville workshop.

The applicant's staff investigated the work required to repair the hammer. Leaving aside irrelevant negotiations, on 13 May

1993 Mr Di Cesare faxed to Mr Foxman a quote "to fix your

hammer for $55,000" under five conditions. The fourth condition stipulated that payment "must be by bank guarantee or irrevocable letter of credit. " Mr Foxman subsequently telephoned Mr Di Cesare to say "I won't raise a letter of credit or a bank guarantee. I'll pay by bank cheque or telegraphic transfer." On 14 May 1993 Mr Foxman faxed Mr Di Cesare accepting the applicant's offer and requesting him to proceed with the repairs.

On 7 June 1993, after the repairs had been completed, the applicant arranged to return the hammer to the respondent. Mr Agius was in charge of the delivery and he took the hammer on the back of a truck to the respondent's Banksmeadow premises. There he requested a bank cheque for $55,000 before he would "hand over" the hammer. He was fobbed off and kept waiting by the respondent's staff, including Mr Foxman. Whilst Mr Agius

was removed by the respondent's staff who refused to put it	was away from the truck closeted with Mr Foxman, the hammer
back when requested. The hammer has now been taken to the North Sydney site.
I have not set out in detail the evidence of the way in which Mr Agius was lured out of sight by the respondent's staff. I have no doubt, however, that the respondent's conduct constituted a "blatant deception" as Mr McKenzie described it and that, in consequence, the applicant has been tricked out of its lien over the hammer. Sadly, however, I am firmly of the view that the applicant's loss of possession extinguishes its lien. Had the applicant been able somehow to recover possession, the circumstances of its temporary loss of possession on account of the trick of the respondent, would have meant that its lien was intact. But this is not the case here, and there is no such thing as a notional lien where a person does not have possession.

W McKenzie has referred me to the decision of Walsh J in

rd Electronic AD~aratus Laboratories Ptv Ltd v. Stenner

[l9601 NSWR 447. In that case the plaintiff had agreed with

the defendant to assemble goods to the latter's specification

by working on parts supplied to it and supplying materials

itself. The assembled goods were held to have a character and function different from that of the subordinate parts considered separately. The plaintiff had a lien upon the goods and the defendant took them out of its possession.

Walsh J held that the plaintiff had a special property in the	goods sufficient to support an action against the defendant
for trespass or for conversion.
However here, whatever special property the applicant may have in the hammer for the purpose of recovering damages against the owner, it would not entitle the applicant to an order under S 87 of the Trade Practices Act for the return of the hammer. The applicant itself alleges in the statement of

claim that the respondent is, and at all material times has been, the owner of the hammer. The relief sought in paragraph 2 of the draft order is, Mr McKenzie acknowledged, moulded by analogy to that obtained under S 74 of the Supreme Court Act

1970 (NSW) in respect of a lien. So much appears too from

paragraphs 2 and 3 of the application, the latter of which is plainly interlocutory in terms. The reference to this statutory analogy emphazises that the effect of the interlocutory relief sought by the applicant would be to recreate a lien which has been lost. The Court cannot create a possessory lien.

In the alternative, Mr McKenzie sought relief in terms of paragraphs 1 and 2 of the notice of motion. However, as I have explained, the applicant has no true proprietary interest in the hammer. It was suggested that the parts used in the repairs have a separate identity in respect of which the applicant retains ownership, but the evidence does not establish that, notwithstanding the cost of the parts utilized

in the repairs and itemized in the invoice dated 7 June 1993.

Nor is there any evidence of likely damage to such parts from the use of the hammer.

Accordingly, the notice of motion is dismissed and the

parties are released forthwith from the undertakings given on

11 June 1993. It follows from what I have said that it seems

to me that the plaintiff's claim is, in effect, a common money count for $55,000. In any event, I should have thought that the District Court of New South Wales has power to grant the remedies sought (including, judgment in detinue) and the matter should be transferred to that court. I will hear counsel on this question.

I certify that this and the preceding six pages are a

true copy of the Reasons for Judgement herein of the

Honourable Mr Justice A.P. Whitlam.

Associate:

Date r

I S + S.% t q q 3

Counsel for the applicant:  J.R. McKenzie

instructed by Brown & Rouch

Counsel for the respondent:  G.P. Segal

instructed by R.L. Kremnizer & CO

Date of hearing:	9, 11 & 15 June 1993
Date judgment delivered:	15 June 1993