Lobster & Co Trading Pty Ltd v Nisbets Australia Pty Limited

[2023] NSWSC 1179

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:

Lobster & Co Trading Pty Ltd v Nisbets Australia Pty Limited [2023] NSWSC 1179

Hearing dates:

16 August 2023

Date of orders:

29 September 2023

Decision date:

29 September 2023

Jurisdiction:

Common Law

Before:

Harrison AsJ

Decision:

(1) Leave to file a further amended summons is refused.

(2) Leave to appeal in relation to Appeal Ground 2 is refused.

(3) Appeal Ground 3 has failed.

(4) The decision of Magistrate Greenwood dated 20 October 2022 is affirmed.

(5) The Amended Summons dated 24 March 2023 is dismissed.

(6) The appellant is to pay the respondent’s costs.

Catchwords:

Appeal from Local Court decision – Local Court dismissed plaintiff’s claim – dispute over failure of chairs to be delivered – the defendant found not to be in breach of contract with plaintiff.

Legislation Cited:

Sale of Goods Act 1923 (NSW) s 32

Local Court Act 2007 (NSW) s 40

Cases Cited:

Agricultural and Rural Finance Pty Ltd v Gardiner (2008) 238 CLR 570; [2008] HCA 57

BSO Network Inc v EMClarity Pty Ltd (No 2) [2021] QSC 192

Canning v Temby [1905] HCA 45; 3 CLR 419 at 424

Donau Pty Ltd v ASC AWD Shipbuilder Pty Ltd (2019) 101 NSWLR 679; [2019] NSWCA 185

Electricity Generation Corporation v Woodside Energy Ltd [2014] HCA 7; 251 CLR 640

Kennedy v Vercoe (1960) 105 CLR 521

Mount Bruce Mining Pty Limited v Wright Prospecting Pty Limited [2015] HCA 37; 256 CLR 104

Namoi Sustainable Energy Pty Limited v Buhren [2022] NSWSC 175

Reid v Moreland Timber Co Pty Ltd [1946] HCA 48; 73 CLR 1

Simic v New South Wales Land and Housing Corporation [2016] HCA 47; 260 CLR 85

Victoria v Tatts Group Ltd [2016] HCA 5; (2016) 90 ALJR 392

Category:

Procedural rulings

Parties:

Lobster & Co Trading Pty Ltd (plaintiff)
Nisbets Australia Pty Limited (defendant)

Representation:

Counsel:
A. Fernon SC (plaintiff)
J. Elks (defendant)

Solicitors:
Yates Beaggi Lawyers Pty Ltd (plaintiff)
Aditum Lawyers (defendant)

File Number(s):

2022/343163

JUDGMENT

1. This is an appeal from a Local Court decision.

2. By summons filed (15 December 2023) the plaintiff appeals from orders of the Local Court (Magistrate M Greenwood) (‘the magistrate’) dated 20 October 2022 dismissing Lobster’s statement of claim, with costs to be paid on an ordinary basis until 10 October 2022, and thereafter on an indemnity basis. The plaintiff does not pursue appeal grounds 1 and 4. That leaves appeal grounds 2 and 3.

3. The plaintiff is Lobster & Co Trading Pty Ltd (‘Lobster’). The director of Lobster is Farshad Armibeaggi. Mr Armibeaggi is also a legal practitioner. The defendant is Nisbets Australia Pty Limited (‘Nisbets’). Lobster was represented by A. Fernon SC of counsel. Nisbets was represented by J. Elks of counsel. Lobster relied on the affidavit of Farshad Amirbeaggi filed on 18 April 2023. Nisbets relied on the affidavit of Carlyon Ward dated 27 April 2023.

4. The amended summons filed 24 March 2023 seeks:

“1 Appeal allowed.

…

3 Orders of the Court below made 25 October 2022 be set aside.

4 The Defendant to pay the Plaintiff the amount of the Plaintiff’s claim in, and costs of, the proceedings below.

5 In the alternative to Order 4 above, remit the matter back to the Local Court of New South Wales reconstituted to be determined.

6 In the alternative, leave granted under section 40(1) of the Local Court Act 2007 (NSW) to rely on grounds that raise mixed questions of law and fact in respect of orders below.”

5. In oral submissions, counsel for Lobster submitted that should the appeal be successful, this Court should enter judgment in favour of Lobster in the sum of $5,431.60, rather than remit the matter back to the Local Court to be dealt with according to law. Appeal grounds 2 and 3 read:

“2 The Court below failed to determine the proceeding before it on the evidence adduced and instead determined the proceeding unduly narrowly on the case as Pleaded in the Statement of Claim.

3 The Court below erred in failing to find that it was a term of the contract for sale and/or there was a representation made upon which the Plaintiff relied as to a reasonable time for delivery of the chairs purchased constituted as close to or as soon after 22 December 2021 arose out of all the circumstances of the case and the legitimate expectations of honest commercial people in all the circumstances”

Leave to file an amended summons

6. At the outset of the hearing of this appeal in this Court, Lobster sought to file an amended summons to appeal against the indemnity costs order made following the dismissal of Lobster’s statement of claim.

7. Lobster required leave to appeal to bring the amended summons pursuant to s 40(2)(c) of the Local Court Act 2007 (NSW) concerning costs. Lobster also requires leave to proceed in relation to the Magistrate’s refusal to allow Lobster to file an amended statement of claim (‘ASC’) on the day of the hearing in the Local Court as it is an interlocutory order. It reads:

40   Appeals requiring leave

(cf LCA 1982, section 74)

…

(2)  A party to proceedings before the Court sitting in its General Division who is dissatisfied with any of the following judgments or orders of the Court may appeal to the Supreme Court, but only by leave of the Supreme Court—

(a)  an interlocutory judgment or order,

…

(c)  an order as to costs.

The law

8. It is settled law that “it is appropriate to grant leave only in those matters that involve issues of principle, questions of general public importance, or an injustice which is reasonably clear, in the sense of going beyond what is merely arguable”: Namoi Sustainable Energy Pty Limited v Buhren [2022] NSWSC 175 (‘Namoi’).

9. In Namoi, Bellew J stated at [39]:

“... there is a need for legal costs to be proportionate to the amount in issue. The Local Court has a limited monetary jurisdiction in civil cases. Left unchecked, appeals from its decisions, especially interlocutory decisions, could lead to there being a significant risk that the overall costs of proceedings would be completely disproportionate to the matters in dispute. Accordingly, a relevant consideration in the exercise of the discretion to grant leave is the proportionality between the amount in issue and the legal costs which have been expended. Disproportion between the two may be a further reason for refusing leave, particularly having regard to case management principles and the appropriate allocation of court resources.”

10. Bellew J in Namoi further referred to how ex tempore reasons of the Local Court should be treated (at [43]):

“To begin with, her Honour’s reasons were delivered ex-tempore, immediately following the conclusion of submissions. It has been repeatedly acknowledged that a Court exercising an appellate function must read reasons delivered in such circumstances with a proper consciousness of the pressures under which Magistrates in the Local Court work when dealing with large volumes of cases in busy lists, and the practical problems they face in making important and difficult decisions with great speed in order to facilitate the progress of proceedings, and the administration of justice.”

Leave to file an amended summons

11. At the outset of the hearing and after hearing the parties’ submissions on whether Lobster should be granted leave to file the amended summons seeking to include an appeal against an indemnity costs order, I refused to grant leave on the basis that there was a delay of approximately 10 months and there was no satisfactory explanation provided for the long delay. Apparently, counsel was briefed a week or so before the hearing and gave advice that an appeal should be brought in relation to the indemnity costs order. As a legal practitioner, Mr Armibeaggi, the director of Lobster and solicitor has been in a position to appeal the costs order shortly after 20 October 2022. Lobster had already filed an amended appeal once the transcript became available. Lobster’s application to amend the statement of claim in the Local Court (Ground 2 of the Appeal): also requires leave as it is an interlocutory decision. The claim the subject of this appeal is a modest sum of $5,413.60 and the costs expended by the parties (excluding costs of this appeal) have well exceeded the amount in dispute.

12. The appeal concerns a modest sum of $5,413.60. It is my view that the magistrate’s decision to dismiss Lobster’s ASC in the Local Court and her Honour’s decision to award costs on an indemnity basis and against Lobster do not raise issues of principle, questions of general public importance, or an injustice which is reasonably clear, in the sense of going beyond what is merely arguable.

13. Further leave should not be granted in relation to Appeal Ground 2 in relation to the filing of an ASC on the morning of the hearing in the Local Court. The decision made by the Magistrate to refuse to grant leave for the plaintiff to file this ASC does not raise any principles or questions of public importance, nor is there an injustice that is reasonably clear, in the sense of going beyond what is merely arguable. In any event, if I am wrong, I have set out my reasoning in relation to Appeal Ground 2 later in this hearing. Appeal Ground 3 raises a question of law, no leave to appeal is required.

Background

14. On 19 February 2022, by statement of claim, the proceedings were commenced in the General Division of the Local Court by the plaintiff against the defendant, because as at the time of filing the statement of claim, Lobster sought the sum of $22,729 from Nisbets. That amount included the sum of $11,194 for the value of chairs that had not been delivered. On 6 May 2022 the chairs had been delivered, so such amount was no longer pursued. At the time of the hearing, $5,413.60 was in dispute. On 7 March 2022, Nisbets filed a defence.

15. The proceedings concerned Lobster’s purchase from Nisbets on 24 November 2021 of pavement chairs for use in its outdoor food business. On 6 December 2021, Lobster paid $11,194 in full to Nisbets for the chairs. On 9 December 2021, Nisbets communicated an expected delivery date of 22 December 2021, which was revised. Nisbets offered to deliver the chairs in mid-February 2023, but did not do so.

16. On 21 April 2020, the Local Court made orders granting leave to Lobster to file and serve an ASC by 28 April 2022 (FAA 115 [7] and 119). On 25 May 2022, Lobster filed and served an ASC which was initially accepted by the Local Court (FAA 1 - 10). The amendments relevantly were to plead the implied term that delivery be made within a reasonable time and consumer guarantees implied into the contract for sale by reason of sections 60 - 62 of the Australian Consumer Law (ACL) (FAA 3 - 5). By letter dated 25 May 2022, the Local Court Registrar advised Lobster’s solicitors that the ASC had been "voided" as it had been filed out of time (FAA 136).

17. As noted in the email from the registry above, there was then a further interlocutory hearing on 23 June 2022 relating to a costs motion. No effort was made by Lobster’s counsel to re-agitate the ASC during this occasion or seek leave to file upon it (Ward Amendment Affidavit at [18]). Due to the ASC being voided, as Mr Ward, Nisbets solicitor explains, Nisbets’ evidence was filed and prepared based on the original statement of claim. Then, on the Review on 20 September 2022, Nisbets’ counsel raised the issue with the Magistrate as the Amirbeaggi affidavit filed in the substantive proceedings made reference to the (voided) ASC, and legal issues that were only raised in the ASC. The Magistrate confirmed that the ASC had not been accepted, and her Honour rejected an oral application for leave that was made during the Review. Nisbets was also granted until 27 September 2023 to file any evidence in reply to Lobster’s evidence (FAA 116 [17]). The matter was listed for hearing before the Local Court on 20 October 2022.

18. Lobster then filed a motion on 27 September 2022 seeking leave to rely on the ASC. The ASC was supported by an affidavit of Tamara Rabadi dated 26 September 2022. Ms Rabadi accepted that on 25 May 2022, her firm received correspondence from the Registry that the ASC was “voided as it was filed out of time”. The letter is at page 136 to the Amirbeaggi Appeal Affidavit. The letter was sent to Mr Amirbeaggi, i.e. the solicitor on record and also Lobster himself—a party could hardly be provided better notice of an action taken by a court registry. But Ms Rabadi (his employed solicitor) deposed she did not “notice the correspondence until recently”, and merely assumed the ASC had been accepted (Rabadi Affidavit at [14]. She however, noted that the ASC had “since been removed from the NSW Online Registry portal” (Rabadi Affidavit at [15] (see Amirbeaggi Appeal Affidavit (A1 Aff at pg 116)). Ms Rabadi however gave no other excuse or justification for the delay in seeking leave to rely on the ASC.

19. Nisbets’ solicitor, Mr Ward provided an explanation as to the prejudice it would suffer should the amendment be allowed. She deposed that the ASC sought to make several material amendments, including adding Australian Consumer Law (‘ACL’) claims, pleading consumer guarantees, pleading implied terms under the ACL, alleging a further three alleged breaches, implied term under s 62 of the ACL and so forth. According to Nisbets’ solicitor the ASC sought to add in contentions relating to implied terms of delivery of the chairs “within a reasonable period of time”: see ASC [6A]; [13].

20. Mr Ward explained that prejudice would result if the amendments were permitted at the eleventh hour, including that the Nisbets had prepared its case and evidence in answer on the basis of the unamended statement of claim, would need to prepare and file an amended defence, would need to investigate and adduce evidence as to the applicability of the ACL, refuting the representations and so forth, and prepare further submissions.

The hearing in the Local Court on 25 October 2022

22. When the matter was called on for hearing on 20 October 2022, the Magistrate heard short argument from both Lobster and Nisbets as to whether leave should be granted to Lobster to file an ASC. Her Honour dismissed the motion and gave short ex tempore reasons as follows (FAA 143):

“HER HONOUR: All right. Thank you very much. Of course, these decisions have to be made in relation to ss 56 and 57 of the Civil Procedure Act, having regard to the matters in 58. What has happened here, the Court did permit an amended statement of claim, but that deadline was missed. It was missed by nearly a month. Of course, that meant that the registry, it might have accepted it, but it ended up rescinding that acceptance. This was a matter, of course, as soon as the deadline was missed it required a motion to rely on that amended statement of claim.

Looking at the s 58 matters, really there were opportunities under the Act and Rules, particularly under the Rules, to file an a motion to get the late amended claim in. That did not happen. There is nothing to suggest that it was a lack of expedition beyond the control of the party.

I have to, under s 57 I must have regard to the just determination of the proceedings and the timely disposal of these and all other proceedings at an affordable cost to the parties. In addition, the efficient disposal of the Court's business and the efficient use of Court resources. I think those last two matters are not so much the issue today. It is the just determination of the proceedings. That is because I understand that the defence has prepared its evidence based on the original statement of claim.

Further, the issue of cost is always important. This is quite, at this stage, a small claim. The real issue is one of fairness. It would be difficult to see how this matter could be adjourned to give an opportunity to rectify the evidence.”

TODAY, IN MY VIEW, I MUST DISMISS THIS MOTION.

Appeal Ground 2

23. Appeal ground 2 is that: “[t]he Court below failed to determine the proceeding on the evidence adduced and instead determined the proceeding unduly narrowly on the case as pleaded in the Statement of Claim”.

Lobster’s submissions

24. The rejection of the ASC did not preclude nor negate the Court's obligation to consider this relevant consideration in the correct construction of the contract for sale. It was a necessary element of determining the obligations of Nisbets as vendor of the chairs.

25. Ascertaining the legal meaning of reasonable time depends upon an assessment of the circumstances at the time the contract was entered into, and its limit is determined by reference to what is fair to the parties. The question whether a reasonable time for performance has elapsed takes into account any estimate given by the performing party of how long performance would take, whether that estimate has been exceeded and, if so, in what circumstances. The performing party is not entitled to justify its delay by relying upon the materialisation of a risk of which the contracting party was on notice and which that party was contractually obliged to bear: see BSO Network Inc v EMClarity Pty Ltd (No 2) [2021] QSC 192 [352] (‘BSO Network’).

26. This appeal is, of course, by way of rehearing: UCPR 50.16. The Court is obliged to conduct the task of weighing conflicting evidence and drawing its own inferences and conclusions. On this review, the Court would be satisfied that it was in the contemplation of both parties when the contract was entered into that delivery should be performed on or before 22 December 2021. The material conditions which actually prevailed, and that it endeavoured to discharge its obligations, although relevant to the legal determination of a reasonable time for the fulfilment of the contract, fell to Nisbets to prove. This aspect of Nisbets’ case is negligible and constitutes a bare assertion with respect "COVID related supply chain issues" although there is no contemporaneous evidence at all supportive of this assertion. In any event, Nisbets’ statement of delivery date of 22 December 2021 necessarily included any considerations of COVID related supply chain issues.

27. Importantly, Nisbets did not and could not justify why when in mid-February 2022, when the chairs came into its possession (FA 83), they were not delivered until 6 May 2023. The explanation on the evidence is clearly that it was using the delivery of the chairs to secure a release from the claims the subjects of the proceedings.

28. It is entirely plain that as at the date of delivery a reasonable time had elapsed, and the delay was "so unreasonable in its length as to involve a complete failure of performance in an essential provision of the contract.": Kennedy v Vercoe (1960) 105 CLR 521 at 527. It is uncontentious that at this date Lobster would have been entitled to an order for specific performance of the obligation to deliver the chairs, as Nisbets could not justify its renunciation of its obligation to deliver the chairs within a reasonable time frame upon them coming into its possession. Accordingly, Lobster was entitled to succeed in its claim.

Nisbets’ submissions

29. It essentially says that the Local Court erred in determining the case as pleaded in the Statement of Claim. It is perhaps trite to submit that the Local Court was correct to decide the proceeding on the case as pleaded in the statement of claim. to find otherwise would be contrary to well settled procedural fairness principles that the pleadings define the case and departure from a pleaded case is impermissible. A court cannot be in error by not going beyond a pleaded case and straying into arguments that were not raised, were not contended for, and not argued at a hearing.

30. However, again this is a misstatement of the case as pleaded and decided before the Local Court, and requires leave to seek in full, because the issues relating to “reasonable time for delivery”, “representations”, and “legitimate expectations of honest commercial people” were not pleaded in the statement of claim, not argued in the hearing in the Local Court, were only sought to be raised in the (rejected) ASC.

29. On the case run in the Local Court and as pleaded, in order to show breach as pleaded in the statement of claim, it had to be shown that there was a term of the Agreement that the chairs would be delivered by “22 December 2021” as defined as the “Delivery Date”. Contrary to Lobster’s submissions at [16], [22]-[23] this was the case that was run in the Local Court, after the ASC was rejected.

30. The fact that this was the case run and decided in the Local Court is patently clear from the transcript. Lobster’s counsel stated in answer to the Magistrate’s question as follows:

“HER HONOUR: Based on the original motion [statement of claim], what are the issues in this matter?...

KLOOSTER: Based on the sealed statement of claim the three issues are, (1), whether my friend can incorporate the terms and conditions, (2), whether my client can prove that there was a term that the chairs be delivered by 22 December, and (3), whether there's been a breach, (4), whether loss has been established. I'm not sure if (1) is an issue. Is (1) an issue?

ELKS: Well, I think that we can even simplify it if my friend agrees. On the original pleading that's now the pleading in question, was it an express term of the agreement that the defendant deliver to the plaintiff the steel chairs by 22 December 2021, if so, was there a breach? If there was a breach, do the terms and - well, also whether the terms and conditions were validly incorporated. Then if my plaintiff gets to it, the question of loss. Do you agree?

KLOOSTER: I don't think there's any dispute that if there is a term that the chairs need to be delivered by 22 December, they weren't delivered. It's really whether that term is there.

ELKS: I agree with that.

HER HONOUR: Is an express term?

KLOOSTER: It's pleaded as an express term.

HER HONOUR: Okay. Right.

ELKS: I think that's really the crux of the debate, unless my friend succeeds on that point and it goes to a question of terms and conditions and then loss [Nisbets emphasis].”

33. Accordingly, the case as pleaded in the statement of claim, and as put in the hearing by Lobster’s counsel, was that: was there an express term of the agreement that the Defendant deliver the chairs by 22 December 2021? It was accepted that if the term is not found to be in there, then Lobster would fail. The Local Court found that such an express term was not in the agreement as properly construed, and as such Lobster failed in its case.

Resolution

34. The Magistrate was entitled (and correct) to come to the conclusion she did. I understand that the defence has prepared its evidence based on the original statement of claim. The main reasons her Honour gave for refusing to file the ASC is that Nisbets had prepared its evidence based on the original statement of claim and second the issue of costs is also important, and it is a small claim. The real issue is one of fairness. It would be difficult to see how this matter could be adjourned to give an opportunity to rectify the evidence.

35. As I said earlier, the Appeal Ground 2 does not satisfy the test for the grant of leave to appeal, particularly when the decision of the Magistrate was correct.

The hearing before the Magistrate

36. The statement of claim relevantly pleaded:

5. On or about 24 November 2021 the plaintiff and defendant entered into an agreement whereby the defendant agreed to supply the plaintiff with 100 (one hundred) Bolero Grey Pavement Style Steel Chairs (Steel Chairs) in consideration for payment in the amount of $11,194.00 (the Agreement).

6. It was a term of the Agreement that the defendant deliver to the plaintiff the Steel Chairs by 22 December 2021 (Delivery Date).

…

9. In breach of the Agreement, the defendant failed to supply the Steel Chairs to the plaintiff by the Delivery Date (Breach).

37. The contract for sale comprised two documents: Nisbets’ pro-forma tax invoice and the Sales Acknowledgement Receipt. These two documents are reproduced below:

38. The first document is the pro forma invoice is A1 p 76. It is relevantly extracted below and dated 24 November 2021 (noting that the chairs were not paid for until 6 December 2021 sometime after):

39. Under Header Comments it states, “express dispatch”.

40. The second document is the sales acknowledgement document: The Magistrate then reviewed the sales acknowledgment document A1 at p 79.

41. The sales acknowledgement document stated under header comments “express dispatch” and at the bottom of the form it states “we are currently out of stock of this product. The expected dispatch date is 22 December 2021.

42. Her Honour was not satisfied that, by its Sales Acknowledgement dated 9 December 2021, Nisbets had by the notation "The expected despatch date is: 22/12/2021" made a representation that the chairs would be delivered by 22 December 2021, dismissed the Statement of Claim. The Court below interpreted those words to mean "We hope to be able to despatch these chairs on 22 December" and therefore there was no promise that the chairs would be delivered by that date. This is in the context of the Local Court’s holding that chairs were held to have been delivered on 3 February 2022.

Appeal Ground 3

45. Ground 3 is that the Court below erred in failing to find that it was a term of the contract for sale and/or there was a representation made upon which Lobster relied as to a reasonable time for delivery of the chairs purchased constituted as close to or as soon after 22 December 2021 arose out of all the circumstances of the case and the legitimate expectations of honest commercial people in all the circumstances”.

The law

46. It is common ground that the task of identifying the meaning of those documents comprising the contract involved identifying the intention of the parties on an objective basis by reference to the text, construed in light of its context and purpose: Electricity Generation Corporation v Woodside Energy Ltd [2014] HCA 7; 251 CLR 640 at [35]; Mount Bruce Mining Pty Limited v Wright Prospecting Pty Limited [2015] HCA 37; 256 CLR 104 at [46]-[51] and [108]-[109]; Victoria v Tatts Group Ltd [2016] HCA 5; (2016) 90 ALJR 392 at [51]-[75]; Simic v New South Wales Land and Housing Corporation [2016] HCA 47; 260 CLR 85 at [18] and [78]. Evidence of the subjective intentions of the parties was not relevant. The start and end point for construction of these documents was the language chosen by Nisbets to record the sale, to which the Court was required to give effect unless to do so would give the contract an absurd operation. It is not legitimate to use as an aid in the construction of the contract for sale anything which the parties said or did after it was made: Agricultural and Rural Finance Pty Ltd v Gardiner (2008) 238 CLR 570; [2008] HCA 57 at [35].

47. It is well established that where no time for performance of any contractual obligation is specified, the law would imply a term that performance must be effected within a reasonable time: Donau Pty Ltd v ASC AWD Shipbuilder Pty Ltd (2019) 101 NSWLR 679; [2019] NSWCA 185 at [99]-[109] (‘Donau’); Canning v Temby [1905] HCA 45; 3 CLR 419 at 424; Reid v Moreland Timber Co Pty Ltd [1946] HCA 48; 73 CLR 1 at 13.

48. Section 32 of the Sale of Goods Act 1923 (NSW) also provides that if the contract does not fix a time for sending, the seller is bound to send them within a reasonable time.

49. The construction of the contract necessarily required consideration of what was a reasonable time in the circumstances that existed at the time of the Contract. Those facts included the time represented by Nisbets as to the time for delivery. The time for ascertaining the legal meaning of "reasonable time" is the time of contracting: Donau at [109].

50. Lobster submitted that the Court below engaged in none of this analysis above and it should have.

51. Ascertaining the legal meaning of reasonable time depends upon an assessment of the circumstances at the time the contract was entered into, and its limit is determined by reference to what is fair to the parties. The question whether a reasonable time for performance has elapsed takes into account any estimate given by the performing party of how long performance would take, whether that estimate has been exceeded and, if so, in what circumstances. The performing party is not entitled to justify its delay by relying upon the materialisation of a risk of which the contracting party was on notice and which that party was contractually obliged to bear: see BSO Network Inc v EMClarity Pty Ltd (No 2) [2021] QSC 192 [352].

52. As at the date of delivery a reasonable time had elapsed, and the delay was "so unreasonable in its length as to involve a complete failure of performance in an essential provision of the contract.": Kennedy v Vercoe (1960) 105 CLR 521 at 527. Accordingly, Lobster was entitled to succeed in its claim.

Lobster’s submissions

53. At the hearing of matter below, the issue squarely before the Court below was whether, in all the circumstances, Nisbets had breached an obligation to deliver the chairs the subject of the contract for sale in breach of the contract. This was so regardless of the proposed amendment to the statement of claim.

54. The proceedings below were conducted on the basis that the contract for sale comprised two documents: Nisbets’ pro-forma tax invoice and the Sales Acknowledgement Receipt: see FAA 151.

55. The pro-forma invoice stipulated that the sale was subject to Nisbets’ terms and conditions. The Court below accepted, correctly, Lobster’s unchallenged evidence that Nisbets’ Terms and Conditions were not available on Nisbets’ website at the time of purchase and thereby were not incorporated.

56. Further, it is well established that where no time for performance of any contractual obligation is specified, the law would imply a term that performance must be effected within a reasonable time: Donau at [99]-[109]; Canning v Temby [1905] HCA 45; 3 CLR 419 at 424; Reid v Moreland Timber Co Pty Ltd [1946] HCA 48; 73 CLR 1 at 13.

57. Section 32 of the Sale of Goods Act 1923 (NSW) also provides that if the contract does not fixe a time for sending, the seller is bound to send them within a reasonable time.

58. The construction of the contract necessarily required consideration of what was a reasonable time in the circumstances that existed at the time of the Contract. Those facts included the time represented by Nisbets’ as to the time for delivery. The time for ascertaining the legal meaning of "reasonable time" is the time of contracting: Donau at [109]. The Court below engaged in none of this analysis. It should have.

Nisbets’ submissions

59. With respect to Ground 3 (as properly characterised in light of the case run in the Local Court), Lobster needs to show that the Local Court erred in not finding that there was a term guaranteeing delivery of the chairs by 22 December 2021, i.e. the “Delivery Date” as pleaded in paragraph 6 of the statement of claim.

60. The Magistrate dealt with the issue of contractual construction at page 14 onwards of the transcript (page 151 (A1)). Her Honour closely reviewed the three documents that Lobster asked her to consider in forming the Agreement, namely (i) the pro forma invoice document; (ii) the sales acknowledgement document; and (iii) the email of 19 January 2022.

61. The Magistrate stated: “What is relied on by the plaintiffs are the words ‘Express Dispatch’ that appear on the pro forma invoice document”. The Magistrate said: “what do these words mean…in the context of the transaction?”, noting that she could not see any “other date attached to them”. Her Honour found that in the context, they “appear to be as a result of a request by Lobster for the chairs as quickly as possible”. Her Honour further found that “there is nothing else on the pro forma invoice document of relevance to this issue as to this being an express term”. This reasoning discloses no error.

The pro forma Invoice and the Sales Acknowledgment

62. This document stated expected dispatch date, not delivery date, i.e. likely dispatch from China. The Sales Acknowledgement also used the phrase “expected dispatch date” – on any view, this is far from guaranteed. The Magistrate found, after asking herself “what do these words mean?”, that “it is clear that the defendant company did not have these chairs within its control at this date. It was reliant on someone else or some other way of obtaining these chairs…In my view, the words mean, ‘We hope to be able to dispatch these chairs on 22 December”. In my review, this reasoning discloses no error.

63. Further, it is noted that the “sales acknowledgement document” included as the “shipping address”, “Collection Campbelltown WH”, i.e. for Lobster to collect from the warehouse. This is relevant for Lobster’s new and erroneous contention that delivery was withheld by Nisbets once the chairs were available for collection from that warehouse in Campbelltown.

64. The Magistrate noted that the email dated 19 January 2022 is “more of the same” and simply says “They’re going to be delivered later than expected. Please see the revised delivery date. We’re trying to sort this out”. The email referred to the “original date” of 22 December 2021 and then a “revised date” of 3 February 2022. Her Honour then concluded:

“In my view, nothing about that document adds anything to the previous language or alters the previous language, which is a language of, “We’ll try to get these to you as quickly as possible and we hope to do that by 22 December 2022, and we expect to do that by 22 December”. Then again more of the same in relation to the 3 February date. Of course, the chairs were delivered a week or so later. Today I must find that there is nothing about these documents that indicate that there was a promise to deliver the chairs on those dates [i.e. either 22 December 2021 or 3 February 2022]. It was a hoped-for delivery date.”

65. Nisbets submitted that the Local Court’s reasoning above was entirely correct, and discloses no error. 22 December 2021 was, at most, a “hoped-for” date of dispatch of a set of chairs ordered for delivery from China during a global pandemic. Nothing more than that. Ground 3 should be dismissed.

Resolution

66. The relevant document stated expected dispatch date, not delivery date, i.e. likely dispatch from China. Further, the document used the word “expected” – on any view, this is far from guaranteed. The Magistrate found, after asking herself “what do these words mean?”, that “it is clear that the defendant company did not have these chairs within its control at this date. It was reliant on someone else or some other way of obtaining these chairs…In my view, the words mean, ‘We hope to be able to dispatch these chairs on 22 December”. This reasoning discloses no error.

67. Further, the “sales acknowledgement document” included as the “shipping address”, “Collection Campbelltown WH”, i.e. for Lobster to collect from the warehouse.

68. The Magistrate determined there is nothing about these documents that indicate that there was a promise to deliver the chairs on those dates [i.e. either 22 December 2021 or 3 February 2022]. It was a hoped-for delivery date.”

69. The thrust of Lobster’s submissions is to equate the words “express dispatch” and the expected dispatch dated 22 December 2021 as a “time is of the essence” clause. They do not.

70. The Magistrate was entitled to make the decision she did. Appeal Ground 3 fails.

71. I might add that the law firm acting for the plaintiff in the Local Court and this Court has not bathed itself in glory by not adhering to timetables, seeking to amend on the first day of the hearing in the Local Court and in this Court, over what on any view concerns a very modest sum of $5,413.60.

Costs

72. Costs normally follow the event. The appellant is to pay the respondent’s costs.

THE COURT ORDERS THAT:

1. Leave to file a further amended summons is refused.

2. Leave to appeal in relation to Appeal Ground 2 is refused.

3. Appeal Ground 3 has failed.

4. The decision of Magistrate Greenwood dated 20 October 2022 is affirmed.

5. The Amended Summons dated 24 March 2023 is dismissed.

6. The appellant is to pay the respondent’s costs.

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Amendments

03 October 2023 - Costs order amendment.

Decision last updated: 03 October 2023