McInerney Sales Pty Ltd v Vehicle Development Corporation Pty Ltd
[2007] VSC 160
•22 May 2007
| IN THE SUPREME COURT OF VICTORIA | Not Restricted | |
AT MELBOURNE
COMMON LAW DIVISION
No. 8007 of 2006
IN THE MATTER of an appeal under s.109 of the Magistrates’ Court Act 1989
| MCINERNEY SALES PTY LTD | Appellant |
| v | |
| VEHICLE DEVELOPMENT CORPORATION PTY LTD | Respondent |
---
JUDGE: | Mandie J | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 21 May 2007 | |
DATE OF JUDGMENT: | 22 May 2007 | |
CASE MAY BE CITED AS: | McInerney Sales Pty Ltd v Vehicle Development Corporation Pty Ltd | |
MEDIUM NEUTRAL CITATION: | [2007] VSC 160 | |
---
MAGISTRATES’ COURT – appeal pursuant to s.109 Magistrates’ Court Act 1989 – whether magistrate made errors of law and thereby misdirected himself.
---
APPEARANCES: | Counsel | Solicitors |
| For the Appellant | Mr C A Connor | Browne & Co |
| For the Respondent | Mr L Watts | Efrons |
HIS HONOUR:
This is an appeal from an order of the Magistrates’ Court of Victoria at Melbourne (constituted by Mr I McGrane) made 10 July 2006 whereby it was ordered that the defendant (appellant) pay the plaintiff (respondent) the sum of $37,500, with liberty to apply in relation to costs and interest.
It will be convenient to refer to the respondent Vehicle Development Corporation Pty Ltd as “the plaintiff” and the appellant McInerney Sales Pty Ltd as “the defendant”. The plaintiff sued on an alleged agreement made in or about August 2001 pursuant to which the plaintiff would provide a certain Ford truck (“the truck”) to the defendant “on consignment”. The plaintiff alleged that in or about July 2002 the truck was sold by the defendant (and/or its employees or agents) and that accordingly the plaintiff invoiced the defendant for the sum of $82,500 (inclusive of GST). The plaintiff alleged that the defendant paid the plaintiff $45,000 but had failed to pay the balance of $37,500 and that the defendant was indebted to the plaintiff in the latter amount.
The evidence before the Magistrate showed that a Mr Crutcher (“Crutcher”) in fact had possession of four of the plaintiff’s trucks in Perth, Western Australia where the defendant carried on business as a motor car dealer. The essential factual dispute before the Magistrate related to the nature of the agreement or arrangement (if any) entered into between the plaintiff and the defendant in relation to these four trucks (one of which was the truck in respect of which the debt was alleged to be owing).
The hearing before the Magistrate was spread over three days and involved considerable cross-examination of the principal witnesses. In a reserved decision, the Magistrate accepted the evidence of Mr Waugh (the plaintiff’s witness) in preference to the evidence of Messrs McInerney and Donkin (the defendant’s witnesses). The learned Magistrate in substance found that the plaintiff had agreed with the defendant to sell the four trucks and that upon achieving a sale and receiving payment for each such truck (and only if this happened) the defendant would pay the plaintiff the sum of $75,000 plus GST (i.e. $82,500). The Magistrate further found that Crutcher had acted as agent of the defendant in selling the truck to one Scimone for the sum of $93,000 and in receiving a trade-in vehicle valued at $60,000 and the sum of $33,000, the balance of the price, from the purchaser (Scimone). Crutcher disappeared with the balance of the price but left behind the trade-in vehicle which the defendant sold and, from the proceeds, remitted the sum of $45,000 to the plaintiff – hence the plaintiff’s claim for the balance of the allegedly agreed price of $82,500. The factual version advanced by the defendant was quite different but was rejected by the Magistrate. Of course factual matters are not a basis for appeal under s.109 of the Magistrates’ Court Act 1989 (unless some question of law arises in relation to the fact-finding exercise) but it is fair to say that the plaintiff’s factual case was supported by some documentation and by, at least on one view, the conduct of the defendant in relation to the four vehicles the subject of the alleged agreement or arrangement so that, with respect, it is not surprising that the Magistrate found as he did on the facts, even without taking into account his preference for the plaintiff’s witness, Mr Waugh.
The essential findings of the Magistrate were as follows:[1]
[1]I have numbered the following paragraphs of the Magistrates’ reasons for ease of subsequent reference.
“1.On balance I am satisfied Waugh contacted McInerney concerning the vehicles in the actual possession of Crutcher and discussed the sale of the vehicles.
2.I am satisfied McInerney referred Waugh to Donkin to work out the detail of the arrangement.
3.I am satisfied Donkin was at all times aware that the plaintiff was the owner of the vehicles in the actual possession of Crutcher.
4.I am satisfied that Waugh was probably aware that Crutcher had the physical or actual possession of the four vehicles …
5.I am satisfied that it was agreed between Waugh and Donkin the defendant would sell as vendor and forward payment of an agreed figure to the plaintiff once the full purchase price was paid on resale and the plaintiff had rendered an invoice. All the documentation supports such an agreement.
6.It is, I think, clear that the defendant allowed Crutcher to hold himself out as an agent of the defendant …
7.The entries in the Register clearly indicate the vehicles came into the possession of the defendant as purchaser. The defendant represented that it could lawfully pass title to those vehicles. The defendant does not dispute that good title passed to the purchasers.
8.Specifically, in relation to the [truck in question], in my opinion, by reference to all the evidence a course of business conduct has been disclosed in which the defendant condoned Crutcher holding himself out as an agent for the defendant.
9.I am satisfied the defendant knew the plaintiff was the owner of the [truck] and that Crutcher had actual possession for and on behalf of the plaintiff. The defendant, by virtue of the entry of the vehicle in the Register, acknowledged acquisition of the vehicle.
10.It seems that the system in West Australia requires the registration of vehicles to be conducted through a motor vehicle dealer. Unlike Victoria sales on consignment are permitted under the Motor Vehicle Dealers Act 1973 (WA) but the legislation prohibits a dealer accepting vehicles under a consignment agreement unless that agreement is in writing …
11.It is common ground that no agreement in writing exists.
…
12.Having regard to the legislative prohibition regarding sales under a consignment agreement and to all the evidence I am satisfied that the course of conduct between the parties establishes the defendant agreed to purchase the [truck] from the plaintiff. The evidence reveals that Crutcher had actual possession of the [truck] with the knowledge of the plaintiff, however, the defendant allowed Crutcher to represent that he had authority as a sales person for the defendant therefore, upon entering the contract of sale the defendant, through the agency of Crutcher, had possession of the vehicle and passed possession and title to the purchaser … Scimone. Also, the ostensible authority of Crutcher impliedly included receiving money for the purchase of vehicles. Therefore, Crutcher received the money and trade-in vehicle on behalf of the defendant. The subsequent treatment by the defendant of the trade-in vehicle supports that conclusion.
13.As stated the course of dealing between the plaintiff and the defendant, in my opinion, establishes that the defendant agreed to purchase vehicles owned by the plaintiff and from the proceeds of resale agreed to pay the plaintiff a fixed price.” [The Magistrate went on to find that there was no del credere agency between the plaintiff and the defendant and that the term “on consignment” was not a term of art and covered the relationship of vendor and purchaser which eventuated between the plaintiff and the defendant.]
By Notice of Appeal dated 9 August 2006 the following questions of law were said to be raised. I will deal with each of them in turn.
The first question of law was said to be “whether a consignment agreement in relation to a motor vehicle that was not in writing, the performance of which occurred in the State of Western Australia and which was completed in June 2002 was prohibited by the Motor Vehicles Dealers Act 1973 (WA)?”
It was common ground that the answer to the foregoing question was “no” and that the Magistrate was mistaken when he said[2] that a consignment agreement that was not in writing was prohibited by the Western Australian legislation as it stood in June 2002. However I am satisfied that the Magistrate’s error in this regard did not taint his decision. It is clear from his reasons that his fact findings were based on the evidence and his conclusions flowed therefrom without any need to refer to this legislation. His legal error seems to me to have been immaterial to his decision.
[2]See para 10 of the extract from his reasons.
The second question of law was said to be “whether a consignment agreement in relation to motor vehicles entered into in the State of Victoria in or about August 2001 which was only capable of performance in the State of Western Australia was prohibited by s.36 of the Motor Car Traders Act 1986 (Vic)?” It was common ground that the answer to this question was “no” but further that the question was completely irrelevant to the Magistrate’s decision. The appellant abandoned reliance upon this question.
The third question of law was said to be “whether as at June 2002 a motor vehicle trader could lawfully register a motor vehicle in the State of Western Australia in its own name for the purpose of duly transferring such registration to the purchaser of such vehicle without necessarily having the full legal and beneficial ownership of or the sole and exclusive proprietary interest in the motor vehicle at the time of registration?”. It was common ground that the answer to this question was “yes”. However it does not appear to me that the Magistrate came to a contrary conclusion. Counsel for the appellant said that there was no express statement by the Magistrate to this effect but that it could be inferred from his reasons. I disagree. In my opinion the Magistrate referred to registration of the truck (and the other three trucks) simply as an aspect of the defendant’s conduct tending to support the plaintiff’s version of the facts[3].
[3]See para 7 of the extract from his reasons.
Accordingly the questions of law raised by the appellant do not, it seems to me, assist the appellant in achieving the setting aside of the order appealed from. The Notice of Appeal contained grounds of appeal based on the questions of law above set out, in effect contending, in various ways, that the Magistrate misdirected himself as a result of the legal errors encapsulated in the three questions of law above set out. For the reasons already given, I do not think that the Magistrate, to the limited extent that he made any of these alleged errors of law, misdirected himself as a result.
The grounds of appeal in fact raised a further possible question of law by contending “that the learned Magistrate erred in law by ordering that the appellant pay the respondent the sum of $37,500 in circumstances where the appellant had not received the said sum from the purchaser of the [truck]”. Counsel for the appellant strongly relied upon this ground in addition to the three questions of law to which I have referred because the Magistrate had found that the defendant was not liable to pay for the truck until the defendant had received the proceeds of its resale thereof[4]. However in my view the short answer was, as submitted by counsel for the respondent, that Crutcher was found by the Magistrate to have received payment in full as agent of the defendant[5] and, as a result, the defendant, having been paid in full via its agent, became liable to purchase and pay for the truck. Indeed there was uncontradicted evidence before the Magistrate that the defendant had requested an invoice from the plaintiff once Crutcher had received the money (and the trade-in vehicle) and it was only when Crutcher decamped that the defendant changed its position.
[4]See para 5 of the extract from his reasons.
[5]See para 12 of the extract from his reasons.
There was some debate during the hearing of this appeal as to whether the agreement as found by the Magistrate could in law constitute a consignment agreement as pleaded by the plaintiff. In my opinion the Magistrate correctly found that a sale on consignment is not a term of art but that it was capable of covering the agreement that he found had been made in this case.
For these reasons, it was ordered that the appeal be dismissed with costs.
0
0
0