Lymall Pty Ltd v Sandalford Wines Pty Ltd

[1998] FCA 328

FEDERAL COURT OF AUSTRALIA

PRACTICE AND PROCEDURE - application for adjournment - scope of statement of claim - whether amendment is necessary.

Trade Practices Act 1974 (Cth) - s 52

LYMALL PTY LIMITED -v- SANDALFORD WINES PTY LIMITED

NG 251 OF 1997

FOSTER J

2 FEBRUARY 1998

SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 251 of 1997

BETWEEN:	LYMALL PTY LIMITED APPLICANT
AND:	SANDALFORD WINES PTY LIMITED RESPONDENT
JUDGE:	FOSTER J
DATE OF ORDER:	2 FEBRUARY 1998
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1. The respondent’s application for adjournment be refused.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NG 251 of 1997

BETWEEN:	LYMALL PTY LIMITED APPLICANT
AND:	SANDALFORD WINES PTY LIMITED RESPONDENT

JUDGE:	FOSTER J
DATE:	2 FEBRUARY 1998
PLACE:	SYDNEY

REASONS FOR JUDGMENT
(Extempore)

During the course of the opening address by counsel for the applicant some discussion has arisen as to the scope of the applicant's claim.  Mr Barker QC, appearing for the respondent, has asserted that the statement of claim does not indicate that the applicant is seeking to mount a case for breach of contract.  In particular, he submits that the whole thrust of the statement of claim is the applicant’s assertion, in reliance upon the doctrine of estoppel, that it is entitled to relief for, in effect, misrepresentation, but not for relief from breach of contract. 
He further submits that if a case of breach of contract is to be pleaded by the applicant, he would be entitled to an adjournment. 

On behalf of the applicant, Mr Ireland QC indicates to me that he does not seek any amendment of the statement of claim. He submits that whilst perhaps the claim for breach of contract could have been spelt out with greater precision, nevertheless on a fair reading of the statement of claim, coupled with filed evidence in the case, it was sufficiently indicated to the respondent that amongst other claims such as claims based on estoppel and claims based upon s 52 of the Trade Practices Act 1974 (Cth), there was also claim for breach of contract.

The statement of claim sets out in its early paragraphs the agency agreement of 20 April 1993 in terms which suggest reliance upon that agreement.  The terms of the agreement which are alleged in the statement of claim to have significance for the applicant's case are set out in paragraph 5.  Paragraph 5(b) refers to a term “that the applicant would have  the right to extend the agreement for a further period of three years providing that satisfactory performance was achieved”.  That paragraph of the statement of claim refers back to paragraph 7 of the written agreement of 20 April 1993 which arguably could provide such a right, indeed could provide it for both parties.

Paragraph 6 of the statement of claim is based upon s 52 of the Trade Practices Act.  Of course, if such a claim is established, it will be productive of a measure of damages approximating the measure of damages in tort rather than in breach of contract and the nature of the damages so alleged to have been incurred are set out in paragraph 17.

The statement of claim continues by asserting in paragraph 7 that on 3 November 1995 there was written notification of a desire to extend the term of the agreement for a period of three years from the relevant date in April 1996, and that there was no dispute at any stage of the applicant's right to extend the term.  Other material is included which arguably indicates the parties’ contemplated continuation of contractual arrangements which might be subject to consensual variation and reference is made to suggested future terms.  Reliance is then placed upon an estoppel resulting from the representation said to have arisen from this continuing course of negotiation between the parties.  Further implied representations are referred to in paragraph 15.  One such representation was that the respondent was not proposing to terminate the existing arrangements. 

Paragraph 18 alleges that there was a wrongful repudiation of “the existing and continuing agency agreement between the applicant and the respondent”. Paragraph 19 refers to a purported termination of the existing agency agreement and paragraph 20 indicates an acceptance of that repudiation. Thus, the application itself quite positively asserts a claim for breach of contract. I am advised that material filed on the issue of damages clearly indicates that damages are being claimed inter alia on the basis of loss of profits. This would be appropriate to a breach of contract claim but not necessarily appropriate to a claim under s 52, and certainly not appropriate to a claim for general misrepresentation or estoppel.

I should say that this case has now been going for an hour and a quarter and the degree of progress that has been made is minimal.  The whole philosophy of commercial litigation in the Federal Court requires that this sort of thing does not happen at the hearing.  If there had been some problem envisaged from the manner in which the pleadings were cast, especially having regard to whether a claim was being made for breach of contract in the application, this court would normally expect the party who entertains some doubt or difficulty as a result of the pleading to have raised the matter at an early stage and sought clarification.  That has not happened.

I am satisfied that, although one would not regard, and I say this with all respect, the statement of claim as a model pleading for the raising of a claim in contract, there is sufficient indication that it does involve a claim for breach of contract.  In the circumstances I refuse to give effect to the application which has been made on behalf of the respondent and I direct that the matter should proceed. 

I certify that this and the preceding two (2) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Foster.

Associate:

Dated:             2 February 1998

Counsel for the Applicant:	Mr J.M. Ireland QC
Solicitor for the Applicant:	Nicholas Eddy & Company
Counsel for the Respondent:	Mr I.M. Barker QC with Mr T. M. Lynch
Solicitor for the Respondent:	Tress, Cocks & Maddox
Date of Hearing:	2 February 1998
Date of Judgment:	2 February 1998