N and M Gangemi Nominees Pty Ltd v Hypax Pty Ltd
[1997] FCA 1167
•31 October 1997
FEDERAL COURT OF AUSTRALIA
CONTRACT - agricultural machinery dealer sold second-hand harvester to farmer - farmer told dealer he had 2000 acres of wheat then ready to harvest - term of contract that dealer put harvester into harvestable condition - prior oral representation to same effect - harvester delivered in such poor condition that incapable of being used to harvest - repair efforts unsuccessful - whether dealer had engaged in misleading or deceptive conduct - delay to harvest - eventually, harvesting contractor engaged - part wheat crop damaged by hailstorm - damages - whether hail damage caused by dealer’s breach of contract - whether damage too remote.
Trade Practices Act 1974 (Cth) ss 51A, 52
Koufos v C. Czarnikow Ltd [1969] 1 AC 350 applied
March v E & M H Stramare Pty Ltd (1991) 171 CLR 506 applied
Bennett v Minister of Community Welfare (1992) 176 CLR 408 consideredSimonius Vischer & Co v Holt and Thompson [1979] 2 NSWLR 322 applied
Alexander v Cambridge Credit Corporation Ltd (1987) 9 NSWLR 310 considered
Baltic Shipping Co v Dillon (1993) 176 CLR 344 applied
N & M GANGEMI NOMINEES PTY LTD v HYPAX PTY LTD
No. WAG 32 of 1996
CARR J
PERTH
31 OCTOBER 1997
IN THE FEDERAL COURT OF AUSTRALIA )
WESTERN AUSTRALIA DISTRICT REGISTRY ) No. WAG 32 of 1996 of GENERAL DIVISION )
BETWEEN: N & M GANGEMI NOMINEES PTY LTD
ApplicantAND: HYPAX PTY LTD
Respondent
JUDGE: CARR J PLACE: PERTH DATED: 31 OCTOBER 1997 MINUTE OF ORDERS
THE COURT ORDERS THAT:
1.The respondent pay to the applicant $35,706 plus interest upon that sum calculated from 9 April 1996 at the rate of interest from time to time payable in respect of judgments of this Court.
2.The respondent pay the applicant’s costs of the application.
Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA ) WESTERN AUSTRALIA DISTRICT REGISTRY ) No. WAG 32 of 1996 GENERAL DIVISION )
BETWEEN: N & M GANGEMI NOMINEES PTY LTD
ApplicantAND: HYPAX PTY LTD
Respondent
JUDGE: CARR J PLACE: PERTH DATED: 31 OCTOBER 1997 REASONS FOR JUDGMENT
INTRODUCTION
The applicant, N & M Gangemi Nominees Pty Ltd, seeks damages and other relief arising out of its purchase from the respondent of a second-hand John Deere harvester (“the harvester”). Part of the relief sought is rescission of the contract of sale.
FACTUAL BACKGROUND AND THE PLEADINGS
The following narration of the factual background largely reflects matters which were not in issue between the parties. Where such common ground does not exist and it is necessary for me to make findings of fact, I will identify them.
At all material times the applicant was a corporation which, amongst other things, carried on the business of wheat farming on a property at North Wialki. North Wialki is approximately 260 kilometres North East of Perth as the crow flies. The respondent company carries on the business of supplying second-hand agricultural machinery from its premises at Moora. Moora is approximately 275 kilometres from North Wialki by road. Mr Nino Gangemi is and was at the material times, a director and agent of the applicant. In November 1995, the applicant had on its property a 2,000 acre crop of wheat which was ready for harvesting (“the wheat crop”). In previous years contractors had been used to harvest wheat on that property. For the 1995 season, however, Mr Gangemi decided to cause the applicant to buy a harvester and employ a Mr Cutri to harvest the wheat. Mr Cutri had told Mr Gangemi that he had seen a couple of harvesters for sale at the respondent’s premises.
On 4 November 1995 Mr Gangemi and Mr Cutri attended at the respondent’s premises in Moora and entered into negotiations with Mr Graham Hyde, the respondent’s sales manager. It is common ground that Mr Gangemi told Mr Hyde that he was a director of the applicant, that the applicant had the wheat crop planted at its property at North Wialki, that the wheat crop comprised 2,000 acres, that it was ready for harvesting and that the applicant wanted to purchase a harvester which could be used immediately to harvest the wheat crop. Mr Hyde showed Mr Gangemi the harvester. Mr Gangemi was originally quoted a price of $10,000 for the harvester. Mr Gangemi said, in evidence, (and I believe his evidence except where I indicate otherwise) that he and Mr Hyde then began bargaining. Mr Hyde offered the harvester to the applicant at a price of $8500 “as is”. Mr Gangemi was not agreeable to this and eventually an alternative agreement was reached. The agreement reached was that the respondent would sell the harvester to the applicant for a price of $11,500 on the basis (so the applicant claims) that the machine would be put into a condition whereby it could be used to harvest the wheat crop. The agreement was recorded in writing. Mr Hyde completed a printed form headed “Retail Order Form” (Exhibit A2) which was signed by both Mr Hyde and Mr Gangemi. On that document (“the Contract”) Mr Hyde had endorsed the following:
“DONEYCO TO MAKE MACHINE IN HARVESTABLE CONDITION”
[Doneyco is the business name under which the respondent trades]
In its re-amended statement of claim, the applicant alleges that:
9.Mr Hyde represented to Mr Gangemi that for a total sale price of $11,500 the respondent would undertake mechanical work on the harvester to bring it within a period of one weeks (sic) time into a condition whereby it would be capable of harvesting the wheat crop to the standard commonly expected by farmers in the Wialki district or, alternatively, that the machine when delivered to the applicant would be capable of harvesting the wheat crop to the standard commonly expected by farmers in the Wialki district. (“the representation”).”
The applicant pleads various alternative causes of action based upon the representation. First, the applicant claims that by making the representation the respondent engaged in conduct which was misleading or deceptive within the meaning of s 52 of the Trade Practices Act 1974 (Cth) (“the Act”) or alternatively within the meaning of s 10 of the Fair Trading Act 1987 (WA). That plea itself is put on the following two alternative bases:
.that the harvester was “in such an old and dilapidated condition that it could not within a period of one weeks (sic) time or alternatively at all be placed into a condition whereby it was capable of harvesting the wheat crop”; and
.that the respondent did not intend to place the harvester into a condition whereby it was capable of harvesting the wheat crop (calling in aid the respective provisions of s 51A of the Act and s 9 of the Fair Trading Act relating to representations with respect to future matters).
Secondly, the applicant claims that the representation became an express term of the Contract. Furthermore, the applicant contends that there were two implied conditions in the Contract by virtue of the provisions of either a combination of s 71(1) and s 71(2) of the Act or by the operation of ss 14(1) and (2) of the Sale of Goods Act 1895 (WA). The implied conditions were, respectively, that the harvester would be suitable for harvesting the wheat crop and that the harvester would be of merchantable quality.
The applicant’s case is that at the time when the respondent delivered the harvester to its property at North Wialki it (the respondent) had either not performed any mechanical work upon it or had not performed sufficient mechanical work to bring it into a condition whereby it was capable of harvesting the wheat crop. Various particulars were given to support the contention that the harvester was not in a condition whereby it was capable of doing so. The applicant says that the respondent thereby breached the implied conditions referred to above and also breached the express terms of the Contract. There appear to be two express terms upon which the applicant relies. The first mirrors the representation i.e. that the respondent would perform sufficient mechanical work upon the harvester to bring it into a condition whereby it would be capable of harvesting the wheat crop to the alternative standards referred to in paragraph 9 of the statement of claim. The second express term was pleaded by a further amendment to the statement of claim on the last day of the trial. The amendment took the form of what is now paragraph 13A of that pleading which reads:
“13A. Further or alternatively it was an express term of the contract that the harvester would be in harvestable condition.”
The applicant alleges that as a consequence of the harvester being incapable of harvesting the wheat crop, it suffered loss and damage which were said to have been caused by the respondent’s misleading or deceptive conduct or the breach of either the express or implied terms of the Contract. The applicant seeks rescission of the Contract and repayment of the purchase price. Further, or in the alternative it seeks damages.
By its re-amended defence the respondent narrowed quite considerably the matters in issue between the parties. I think I can summarise the amended defence fairly briefly. The respondent denies that Mr Gangemi gave Mr Hyde particulars of “the nature of the country on which [the wheat crop] was growing”. It also denies that Mr Gangemi told Mr Hyde that he knew nothing about harvesters and was relying on Mr Hyde’s skill and judgment. The respondent denies that the representation was in the terms as pleaded by the applicant. The respondent pleads the representation as being in the following terms:
“Mr Hyde advised Mr Gangemi that the harvester would not harvest with full efficiency, and would as likely as not require minor mechanical attention and/or adjustment by its operator as could be given by a competent operator to the standard expected in the industry from time to time.”
The respondent further says Mr Hyde represented to Mr Gangemi that it would make the adjustments necessary to enable the harvester to be used as pleaded above. Alternatively, the respondent pleads that:
“... if not expressly represented by Mr Hyde, it was known to the Applicant from the Applicant’s inspection of the age and condition of the harvester, that it would not likely be fully efficient or trouble free.”
The respondent denies that the representation was incorporated into the Contract. In relation to the plea of an implied term of reasonable fitness, the respondent pleads as follows:
“a) The harvester was one ordinarily supplied by the Respondent,
b)the Applicant made known to the Respondent, that the harvester was required to harvest broad-acres without full efficiency and requiring attention and/or adjustment expected of a harvester of its age and condition, and
c)the Applicant at the time of sale was relying on the skill and judgment of the Respondent to supply the harvester in such a state of repair.”
In response to the claim based upon the implied condition that the harvester would be of merchantable quality, the respondent denies such a condition and says that it drew to the applicant’s attention the age and worn condition of the harvester and further that Mr Gangemi and Mr Cutri examined the harvester and saw this. The respondent’s case is that the harvester was in a condition whereby it was capable of harvesting the wheat crop. It says, further, that any loss and damage suffered by the applicant was not as a consequence of the failure of the harvester, but was due to the applicant not making a bona fide attempt, or any attempt at all, to put the harvester to work or to make required adjustments.
THE EVIDENCE
The applicant called eight witnesses including Mr Gangemi and Mr Cutri. The evidence of two of those witnesses was relevant exclusively to quantification of damages. The remaining witnesses were Mr R W Meney, a neighbouring farmer, Mr J I Foote, a mechanic who was called in on several occasions to work on the harvester after its delivery to the applicant’s farm, Mr B W Morrison, an expert on farm equipment and Mr E K Lester, a harvesting contractor. The respondent called Mr Hyde, Mr E D Blanchard (whom the respondent presented as “a harvester expert”) and Mr T G Sutherland, a farmer who formerly owned the harvester and who sold it to the respondent in 1995.
I do not think that it is necessary for me to summarise the evidence of these witnesses for the purposes of deciding this case. In my view, it will be sufficient to identify the findings of fact which I make and the evidence upon which I rely (and which evidence I do not rely upon) in so finding.
First, I find that at the time when the parties entered into the Contract the harvester was not in harvestable condition. Mr Hyde, in his evidence-in-chief (at T200) and in cross-examination (at T213) said so. Next, I turn to the matters of the alleged representation and the condition of fitness for particular purpose which the applicant says was to be implied in the Contract.
Mr Foote’s evidence was that the wheat crop was sown on light country and was a light crop. The fact that the wheat crop was a light one was not seriously in dispute between the parties, if at all. The significance of that fact is that it was largely common ground that, in those circumstances, the harvester should have been fitted with what were described variously as “light crop fingers” or “filler teeth”. [The applicant relied on several other alleged defects but this was one of the major ones.] The dispute between the parties centred on whether, as the applicant contended but the respondent denied, Mr Gangemi had sufficiently made known the particular purpose for which he required the harvester as being that of harvesting a light crop. This was on the basis that wheat farms in the Wialki district were on light country and produced light crops. The applicant contended that as a result of an exchange between Mr Gangemi and Mr Hyde shortly prior to entering into the Contract, the respondent was fixed with knowledge that the applicant required the harvester for a light crop. It is common to both Mr Gangemi’s evidence and Mr Hyde’s evidence that Mr Gangemi told Mr Hyde that his farm was at North Wialki, that Mr Hyde told Mr Gangemi that he knew where that was because he had been to school at Beacon, a nearby town. There was some mention of Mr Meney and Mr Hyde said that he knew of Mr Meney and knew the name. From this evidence the applicant extrapolates the proposition that Mr Hyde was made aware that the harvester was required to harvest a light crop. Mr Gangemi did not, in his evidence, say that he had told Mr Hyde that the wheat crop was a light crop. Mr Cutri’s evidence did not go that far either. Mr Hyde’s evidence (in cross-examination at T208-209) was that he would not be surprised if there were light crops at North Wialki but that he was also aware of heavy crops being grown there. Mr Lester (at T175) said that some of the applicant’s farm comprised heavy ground. He said that the farm included both light ground and heavy ground.
I do not consider that Mr Gangemi sufficiently made it known to Mr Hyde that the harvester was required to harvest a light crop or a crop on light country. Nor do I consider that the objective circumstances would warrant a finding that the respondent should have known that this was the particular purpose for which the applicant required the harvester. I find that Mr Hyde represented to Mr Gangemi, at the time when the Contract was made, that the respondent would undertake mechanical work on the harvester to put it into harvestable condition. By that I mean a harvestable condition generally, not specifically for a light crop.
The applicant pleads that part of the representation was that the mechanical work would be done within a week. Mr Gangemi in his evidence said that Mr Hyde asked for three or four days to do the work, but that it was a week before Mr Hyde telephoned him to say that the machine was ready. Mr Gangemi was not cross-examined on that point and I find that the representation was that the work would be done within about a week. I think it is inherently likely that such would be the case, given the fact that the wheat crop was ready for harvest and both parties would have understood that the work would need to be done fairly promptly.
For the reasons which I develop below, I find that when the harvester was delivered to the applicant’s property, it was not in harvestable condition. However, although Mr Meney said that when he saw the harvester on the applicant’s property he thought it would take about one week’s work to put the harvester into a harvestable condition, I do not consider that there is sufficient evidence for me to find that the condition of the harvester when the Contract was entered into was such that it could not have been within a period of one week of that time, or at all, be placed in a harvestable condition. Nor do I accept the applicant’s plea that the respondent did not intend to place the harvester in a harvestable condition. My assessment of Mr Hyde’s evidence is that the respondent did intend to put the harvester in harvestable condition, and that it had reasonable grounds for representing that it would do so, but that its efforts in that regard fell well short of the mark. There was some evidence (from Mr Hyde and Mr Blanchard) that the respondent carried out repairs and serviced the harvester before delivery. I do not consider that the applicant has made out its case of misleading or deceptive conduct on the part of the respondent. I now turn to its contractual claims.
In my view the endorsement on the Contract:
“Doneyco (the respondent’s business name) to make machine in harvestable condition”
is to be construed as meaning precisely that and as reflecting identically the representation which I have described above. The question is whether the respondent fulfilled that express condition?
Mr Gangemi gave evidence about the mechanical condition of the harvester on the occasion of Mr Foote’s first visit to the applicant’s farm. He described how he assisted in replacing burnt out bearings on one of the shafts which deliver wheat from the thresher to the bin. He said that even when that had been done, the harvester was not cutting properly and was leaving around 40% of the grain on the ground.
Mr Cutri, in examination-in-chief, said that immediately after the harvester had been delivered to the applicant’s farm, he attempted to start it. When he activated the ignition, a fire broke out in the area of the starter switch. Mr Cutri’s evidence about the performance of the harvester was substantially to the same effect as that of Mr Gangemi.
At Mr Gangemi’s request, Mr Meney had gone across to the applicant’s farm to help Mr Cutri get the harvester working. The broad thrust of Mr Meney’s evidence was to the effect that the harvester was not capable of harvesting the applicant’s wheat crop. I believed Mr Meney’s evidence on that point. I thought Mr Meney was telling the truth. He was an impressive witness though with a tendency slightly to exaggerate on occasion. That still leaves the question whether the harvester was in harvestable condition. That is, in harvestable condition generally, not just in relation to the applicant’s crop. I accept Mr Meney’s evidence concerning the condition of the harvester. On his first visit to the applicant’s property (in response to Mr Gangemi’s request for help) he noticed that the harvester was leaving about 20 per cent of cut wheat heads unprocessed. In addition there were stalks with wheat heads still left on them. Mr Meney (at T89) described the harvester as not being in a condition which would be acceptable to a farmer harvesting a crop. He said that it would probably take a week’s work in an above-average farm workshop to put it into an acceptable condition. Mr Meney described the defects graphically. He made some adjustments which he said “improved things slightly”. The machine was still not harvesting to what he would regard as an acceptable degree, it was “a long way short still”. It was still failing to pick up close to 20% of the crop. Even after three hours of making adjustments Mr Meney said that he:
“... still was not satisfied that I could go home and feel comfortable that I’d left somebody with a machine that he could use.”
Mr Meney (at T86) said that an acceptable wastage would be virtually nil and that he would not accept even 1%. I think he may have been overstating the position on that point.
I accept also the evidence of Mr Foote in relation to the matter of whether the harvester was in harvestable condition. Mr Foote was a qualified mechanic with some 26 years experience of owning, operating and repairing harvesting machinery. He had also attended “quite a number” of courses to be updated in relation to such machinery. About half of those were concerned with harvesters. Mr Foote attended at the applicant’s property on three occasions. On the first occasion when he inspected part of the crop which Mr Cutri had attempted to harvest, Mr Foote formed the impression that the harvester was leaving about 50% of the grain behind. At T109 he was asked:
“Was that machine when you saw it on the first occasion, capable of harvesting 2000 acres of wheat? --- Not at all.
Not at all? --- No.”
Mr Foote said that it would have taken
“... a minimum of 30 hours labour input and quite a big dollar input in terms of replacing parts that were worn and making repairs to get it to the stage of being able to harvest successfully”.
Later (in re-examination) he said that there would be a minimum of 40 to 50 hours including his travelling and that “... the parts bill including labour I would say would be in excess of $5,000.” When I asked Mr Foote for clarification of that remark he explained that his labour and the parts to attend to the first particular item ( the drum and the concave) would be around $5,000. To get the harvester into a position where it could harvest 2000 acres with a minimum of breakdowns and a reliability factor which was acceptable in the industry, would require the expenditure of about a further $5,000. Mr Foote’s evidence (at T112) was that even after his third visit (when he had fitted what he described as “light crop fingers” to the machine) and the machine was cutting the crop “probably 25 or 30% better”, it was still leaving 30-35% of the grain behind on the ground. Mr Foote thought that a machine in good harvesting condition would exhibit a grain loss of between 1½-2%. In cross-examination he said that the range might be 1-3%.
Then there was the evidence of Mr B W Morrison. Mr Morrison is the manager of Mukinbudin Motors, a firm which specialises in the sale and servicing of all types of farming equipment. Mr Morrison’s duties include attending at farms to value machinery that is to be either traded in on new equipment or otherwise sold. He has been doing this for 23 years and is a fully qualified agricultural mechanic. I found Mr Morrison to be a credible witness. Mr Morrison said that he inspected the harvester on 14 February 1997. In his opinion the harvester was not in a condition in which it would be capable of harvesting a crop “the size of the one presently on the property”. There was no evidence about the size of the crop on the applicant’s property as at 14 February 1997. Mr Morrison gave evidence of numerous faults with the harvester. His description was, in my view, consistent with the evidence given by the other witnesses called by the applicant concerning the condition of the harvester and the deficiencies it exhibited when it was put to work on the applicant’s farm in November 1995. Mr Morrison estimated that it would require expenditure of at least $5,000 to be spent on the harvester to bring it up to a reasonable and acceptable working level. Mr Morrison said that, in his experience, the percentage of grain loss acceptable for a machine in harvestable condition would be 1-2%.
Mr E K Lester, the harvesting contractor who took over the work from Mr Cutri, gave evidence of the appearance of the area of crop over which the harvester had been employed. He said that probably half of the total crop had been left behind. Mr Lester said that an acceptable range of loss would be 1-3%. He said that at the level of a maximum loss of 3% there would have had to have been some adverse conditions such as a crop lying over or terrain which was difficult to harvest. Even Mr E D Blanchard (whom the respondent called as an expert) said that a generally acceptable harvest loss would be between 3-5% for cereal crops. Mr A J Camp, counsel for the respondent, conceded that “harvestable condition” meant that a harvester would achieve between no more than 1-5% losses or thereabouts.
Mr Hyde, in cross-examination, agreed that a machine in harvestable condition was understood in the trade as being one which was capable of picking up about 99% of the grain and cutting about 100% of the stalks. It is quite clear to me, and I so find, that the harvester when delivered (and after various attempts had been made to rectify its faults) was not in a condition to achieve anywhere near those results.
Mr Blanchard has a Bachelor of Science Honours degree in agricultural engineering from the University of Cranfield in England. He graduated in 1981 and said that he had been working in the field of mechanisation and agricultural engineering since graduation, nine years of which were in Western Australia. He described a project which he had conducted for the Grains Research and Development Corporation. He explained that that was in relation to grain legumes, including lupins and peas. However, he said that he had “also been looking at harvesters in other types of crops as well” including wheat. He identified only one occasion in the Wialki area when he had inspected an old and worn harvester comparable to the harvester involved in this matter. He said that he had tested other “units” (by which I took him to mean harvesters) throughout the Western Australian wheat belt, but conceded that they had not been a “huge number of units”.
Mr Blanchard inspected the harvester on 13 June 1997. He was able to get the harvester to start and produced a video which showed the harvester’s engine and moving parts in action but did not show it doing any actual harvesting. Mr Blanchard’s report set out in tabular form his appraisal of the applicant’s various complaints.
I decided that, to the extent that Mr Blanchard’s evidence was relied upon by the respondent to suggest that the harvester was in harvestable condition when delivered to the applicant’s farm, I would prefer to accept the evidence of the applicant’s experts and the evidence given by the other witnesses about how the harvester performed. I considered that the length of experience and the practical nature of the experience of, say Mr Foote, Mr Meney, Mr Morrison and Mr Lester outweighed Mr Blanchard’s experience in the assessment of wheat harvesters. Furthermore, those gentlemen had the advantage of seeing the harvester being applied to the task for which it was intended, namely the harvesting of wheat. Even Mr Blanchard concluded his written report with the following paragraph:
“To further reduce the level of crop losses in light crop conditions due to “material hard to move back to the platform auger” would require the fitting of an air front and the expenditure of approximately $5,000.”
Mr T G Sutherland, the former owner of the harvester, gave evidence that he had used the harvester for the previous year’s harvest. He said that he had not experienced any difficulties caused by faults in the harvester “other than normal maintenance type problems”. I take that evidence into account, but the question is whether the harvester was in harvestable condition at the time when it was delivered to the applicant’s farm. I have earlier referred to Mr Hyde’s evidence in which he accepted that the harvester was not in a harvestable condition at the time when the Contract was made.
In my view, the applicant’s evidence (most of which I have summarised above) establishes that the harvester was not in a harvestable condition when it was delivered to the applicant. It was leaving a grossly unacceptable level of grain behind. I accept the evidence of the applicant’s witnesses to the effect that it was in such a poor condition as not to be capable of being described as being in harvestable condition. In short, I find that the respondent breached the express term of the Contract which obliged it to put the harvester in harvestable condition.
In those circumstances, it is not necessary for me to consider whether the harvester was of merchantable quality. I reject so much of the respondent’s case as was based on the assertion that the applicant had not made a bona fide attempt, or any attempt at all, to put the harvester to work or to make required adjustments. First, I refer to Mr Meney’s efforts on behalf of his neighbour to get the harvester to work properly. I have set out above an extract from Mr Meney’s evidence about his assessment after putting in three hours effort. Mr Meney returned to the applicant’s property about two days later and spent another 3 to 4 hours trying to make the harvester work. Then there were three visits by Mr Foote directed to the same end. Admittedly, Mr Foote first attended at the respondent’s request, but thereafter he was trying to assist the applicant. In my view, the evidence establishes that the applicant did all that could reasonably be required of it to get the harvester to do the work for which it was intended. I now turn to the question of relief.
RELIEF
The applicant seeks rescission of the Contract. I have already rejected the applicant’s claims based upon alleged misleading or deceptive conduct. Accordingly the question of whether the applicant should be entitled to rescind the Contract falls to be decided under the usual legal and equitable principles. No notice of rescission was given, but the application (which included a claim for rescission) was filed in this Court on 9 April 1996. I think that that step can be taken as being equivalent to giving notice of rescission. However, property in the harvester has passed to the applicant, the price has been paid, there is no allegation of a total failure of consideration and nor is there any allegation of fraud. The applicant has retained either actual or constructive possession of the harvester. To the extent that an allegation of fraud might be found in the plea of misleading or deceptive conduct, I have rejected that plea. Accordingly, so it seems to me, the question is whether it would be appropriate in equity to order rescission rather than to award damages. In deciding, as I do, that damages would be a more appropriate remedy, I take into account the absence of fraud. This gives slightly greater significance to the matter of whether the status quo ante can be exactly or substantially restored (a matter which I consider immediately below): Alati v Kruger (1955) 94 CLR 216 at pp 223-224. See also Kramer v McMahon [1970] 1 NSWR 194 at p 205.
The evidence was that the harvester has been left in the open air exposed to the elements (see Mr Blanchard’s report at p 5). Mr Blanchard referred to that fact as suggesting likely deterioration over the years since delivery to the applicant. I do not consider that the applicant has discharged its burden of proving that if rescission were granted, the harvester could be restored to the possession and ownership of the respondent in substantially the same order and condition as it was at the time when it was delivered to the applicant. In my view, the applicant should have damages in lieu of rescission. I now turn to the quantification of those damages.
ASSESSMENT OF DAMAGES
Repairs to the Harvester
The first head of damages should, in my opinion, be the cost of putting the harvester into a harvestable condition. I must say that the evidence on this point was not satisfactory. Normally such evidence would take the form of an itemised list of matters which required attention and a costing of those items. I was presented with what could be described as various global estimates. For example there was Mr Foote’s estimate which I have quoted above of “... something around the $10,000 mark”. I have also referred to the evidence of Mr Lester and Mr Meney of how much time and money it would take to repair the harvester and put it in harvestable condition. Mr Blanchard’s assessment was “approximately $5,000”. Doing the best I can in all the circumstances, I consider that an award of $7,500 would be appropriate under this head. The applicant also claimed what it described as “special damages” being some six amounts said to have been paid for parts and repairs to the harvester before it abandoned that task. Those items total $1882.40. I do not think that it is appropriate to award these as extra damages over and above the estimate of what it would have cost to put the harvester into harvestable condition. That evidence was, as I have indicated, most imprecise and I have tried to reach an assessment using a broad brush. To add a further item of $1882.40 would, in my view, be excessive.
Harvesting Contractor’s Costs
The applicant claimed damages for the expense to which it was put in engaging Mr Lester and his team to harvest the wheat crop. Mr Gangemi’s unchallenged evidence was that he paid Mr Lester’s firm $15,470 for that work. Mr Gangemi said that, in addition, Mr Lester used between $2,000 and $3,000 worth of the applicant’s fuel in harvesting the crop. I infer (in the absence of any evidence to the contrary) that had Mr Cutri used the harvester to do this work (as the applicant originally planned) then he would probably have used an equivalent amount of fuel. Accordingly, I reject the applicant’s claim to additional compensation in that amount. Furthermore, no allowance has been made for the labour cost (Mr Cutri’s wages) if the applicant’s plans had come to fruition. Again the evidence was unsatisfactory. The evidence was that Mr Lester used two machines and took two weeks to harvest the wheat crop. I work on the assumption that, on his own, Mr Cutri would have taken at least six weeks to complete that work. In Exhibit R1A Mr Gangemi states that a Mr Danny Dunham was sent up to the farm with Mr Cutri either in the last week of November 1995 or on 1 December 1995. There is other evidence that “Danny” was to drive the truck into which the wheat was to be loaded. I propose to make an allowance for what would have been Mr Cutri’s and Mr Dunham’s wages or other remuneration, by deducting $2500 from the sum of $15,470 paid to Mr Lester’s firm. Damages in the sum of $12,970 will be awarded under this head.The Hailstorm on 27 December 1995
The applicant claimed damages for wheat loss caused by a hailstorm which occurred shortly after Christmas 1995. From Mr Lester’s evidence and from the contents of Exhibit R1A I find that the hailstorm occurred on 27 December 1995. The applicant’s case was that if the respondent had not breached the Contract, then the wheat crop would have been harvested by that date. It claims damages on the basis that the 700 acres of wheat which remained to be harvested on 27 December 1995 yielded significantly less grain per acre than the 1300 acres harvested before Christmas, due to damage sustained in the hailstorm. I must say that I found this matter to be the most difficult part of the case. Neither counsel assisted me with submissions of substance or references to cases on causation or remoteness, save for one reference to Hadley v Baxendale (1854) 9 Ex 341. I decided that the proper approach was to pose and answer the three following questions:.whether the loss arising from the fact that 700 acres of the crop yielded less wheat per acre due to the hailstorm was a loss caused by the respondent’s breach of contract?
.assuming such causation, whether that loss was sufficiently likely to have occurred as to make it proper to hold that the loss flowed naturally from the breach or whether the hailstorm loss should have been within the respondent’s contemplation? and
.how should that loss be assessed?
I accept Mr Lester’s evidence that the hailstorm caused damage to the applicant’s crop. There were various pieces of evidence on the subject matter of hail. Mr Gangemi’s evidence about the hailstorm did not take the matter very far and was largely hearsay. There was some evidence, originating from Mr Gangemi, that there had been an earlier hailstorm in October 1995. The respondent tendered a copy of a statement given by Mr Gangemi to an insurance assessor on an unspecified date between 27 December 1995 and 15 January 1996. In that statement, Mr Gangemi said that between the 20 and 23 October 1995 or “towards the end of the month” he had a telephone call from a Mr Bill Clarke (who farmed near the applicant’s farm) who told him that there had been hail in the area. Mr Clarke had expressed the opinion that the applicant’s crop had been damaged by hail. Later, so Mr Gangemi told the insurance assessor, Mr Meney told him that the applicant may have sustained some crop damage, given the damage to Mr Clarke’s crop. Mr Gangemi said that from those conversations he thought that 10-15% damage “may have occurred to my crop”.
Mr Foote’s evidence-in-chief on the subject of hail was as follows:
“I was just wondering if you can tell us what the effect on a crop is at this time of year if it is being left for any period of, say a couple of weeks? --- Well, the longer it’s left the more chance of damage by weather conditions i.e. rain or possible hailstorm.
Do you know the North Wialki district? --- Yes, I do.
In your experience is hail there a possibility at that time of year? --- Yes. Every harvest there’s a possibility of hail particularly, you know, later in the season.”
Mr Lester’s evidence was that the North Wialki area was classed as a low rainfall area. He said that quite often there were thunderstorms in November and December with the tail of cyclones coming down from the north. This would result in rain, thunderstorms, lightening and hail. When asked about the frequency of hailstorms he said:
“Well, something we all dread obviously because it does damage our crops; but it’s always patchy but like I’d say annually there would be somewhere within let’s say a radius of 100 kilometres from where we live every year there’d be someone that gets hail for sure.” [Mr Lester lived at Kalannie approximately 100 kilometres from North Wialki].
Mr Lester said that the extent of damage to a crop from hail depended upon how much fell, but it was capable of “totally annihilating a crop”. Mr Lester said that when his team stopped harvesting for the Christmas break approximately 700 acres (i.e. approximately 283.4 hectares) of crop remained. Mr Lester said that on an unspecified date soon after Christmas 1995 (which I have held to be 27 December 1995) he had been on the applicant’s property when a thunderstorm or squall “went through” and hail pelted down for about five minutes. He said that the storm was severe and that the hailstones were the size of marbles, or bigger. “The ground was white with them”. Mr Lester said that he was able to observe the effect that the hail stones had on the remaining 700 acres of crop. His evidence was:
“They definitely knocked it around. You could ... see more wheat bent over, broken over, heads smashed. There was definitely damage from it. Without a doubt.”
The next day his team started harvesting again.In cross-examination Mr Lester said that when he had first arrived at the applicant’s property (before Christmas 1995) he had noticed that the crop was “partially laying over”. He said that it was possible that this also was due to hail.
The applicant called Mr R G Tapp, a meteorologist from the Bureau of Meteorology, to give evidence about the incidence of hail in the Wialki area. Mr Tapp said that he had recently examined the historical records. He said that the annual frequency of thunderstorms in that area was between ten and twenty days per year, that they can occur at any time of the year but predominantly through the warmer months of the year, that is from October through to March or April. Mr Tapp said that hail occurred a lot less frequently than thunderstorms. He said that hail occurred on less than half a day per year on average, or “roughly once every two years or less than that”. He explained that his reference to half a day was not half a day of continuous hail. For a hail day to be recorded by the Bureau, hail has to occur at some time within a 24 hour period from 9.00 am on one day to 9.00 am on the next. It could be for five minutes or five hours, all that was required was that hail had been observed. Mr Tapp said that the nearest observation location to Wialki was Bencubbin which he believed was about 50 kilometres away, but there was then almost an arc of observation stations about 150 kilometres away. Mr Tapp said that hail was not something which was widespread over areas of many square miles or hundreds of square miles at a time but most commonly was “a localised phenomen[on]”. Mr Tapp acknowledged that it was possible that hail occurred more frequently than the Bureau’s records would show. He said that hail by its nature was likely to be under-recorded rather than over-recorded. There then occurred the following exchange in Mr Tapp’s examination-in-chief:
“Right, so for any specific location in any year can we say there is a 50/50 chance of a hail storm? --- No. Much lower than that, it’s one in 200, I guess, half a percent.”
Mr Hyde was cross-examined on the subject of hail. He said that he saw some hailstorms when he lived at Beacon. He said “hail happens right throughout the wheat belt”. However, he denied emphatically that when he sold the harvester he knew that if the harvester did not work there was a real possibility of hail damaging the crop before it could be harvested. Mr Sutherland said that hailstorms occurred “through the wheatbelt”. He had never had a hail claim but had experienced hailstorms in his area. He was unable to give any evidence concerning the incidence of hail in the Wialki area.
CAUSATION
Was the respondent’s breach of contract so connected with the applicant’s hailstorm loss that:
“... as a matter of ordinary commonsense and experience, it should be regarded as a cause of it?” - See March v E & M H Stramare Pty Ltd (1991) 171 CLR 506 at p 522.
I appreciate that March v Stramare was concerned with negligence rather than breach of contract. However, I respectfully agree with the adoption by the learned authors of Carter and Harland “Contract Law in Australia” (3 Ed) at p 775 of this as being the relevant question. The authors also rely upon another negligence case (again in the High Court of Australia) for the proposition that causation for contract law purposes is essentially a question of fact: Bennett v Minister of Community Welfare (1992) 176 CLR 408 at pp 412-413. Both those cases acknowledge the usefulness or importance of the “but for” test but deny to it the role of being a comprehensive and exclusive test of causation. See for example Deane J in March v Stramare at p 522 and Mason CJ, Deane and Toohey JJ in Bennett at p 413. However, as a first step I will apply the “but for” test to the present matter. This requires me first to make an assessment of how much, if any, of the wheat crop would have been still standing on the applicant’s property on 27 December 1995. How long would it have taken for Mr Cutri to have harvested the whole crop if the harvester had been in harvestable condition? I start by trying to make an assessment of approximately how many acres per day Mr Cutri might have harvested. The evidence on this point is somewhat sparse. The evidence suggests that Mr Lester’s team started to harvest the crop on 18 or 19 December 1995 (see Exhibit R1A at p 3). By 24 December 1995 they had harvested 1300 acres of the two thousand acres. I shall assume that work started on 19 December 1995 and progressed continuously until the evening of 24 December 1995 i.e. that six days were involved. This produces a rate of 217 acres per day. Mr Gangemi said that Mr Lester’s team took about ten working days to harvest the whole 2000 acre crop. That suggests an overall rate of 200 acres per day. Mr Lester’s team had two machines working. Mr Lester’s experience at wheat harvesting was very much greater indeed than that of Mr Cutri. Mr Lester had nearly twenty years experience of wheat harvesting both on the family farm and as a contractor. Mr Cutri had virtually no such experience, other than assisting at a wheat harvest in the 1994 season. So, instead of simply dividing the daily rate achieved by Mr Lester’s team by two, I will select a lesser notional figure for what in my assessment Mr Cutri might have achieved had the harvester been in harvestable condition. Another reason for doing this arises out of the age and condition of the harvester. From the various descriptions of the harvester in the evidence, I infer that it was an old one. Even if it were in a harvestable condition, it would be reasonable to expect it to break down occasionally and to require down time for maintenance. Mr Cutri did not have the relevant skills to carry out such running repairs and maintenance. I infer that on occasion outside help would have been required. Estimating as best I can on the evidence, I think it would be reasonable to assume that Mr Lester’s team would have been between three and four times faster than Mr Cutri i.e. that he would have taken between thirty to forty working days to complete the harvest. When would Mr Cutri have started? It would appear from the evidence that Mr Gangemi drew the cheque for the price of the harvester on 20 November 1995. Mr Cutri’s evidence was that he took the cheque to the respondent and I infer that was on the same day. Mr Cutri’s evidence was that the harvester was delivered to the applicant’s farm on the next day. The harvester was thus delivered on or about 21 November 1995. Mr Gangemi’s evidence was that Mr Cutri returned to Perth for an appointment with a specialist the day after the harvester was delivered to the applicant’s farm. Mr Cutri said in his evidence that he was very sick at that time. He went back up to the farm three or four days later. I think it is likely that even with a machine in harvestable condition, given Mr Cutri’s inexperience, a day or so might have been taken up in getting the harvest under way. From the foregoing I find that, if the harvester had been in a harvestable condition, Mr Cutri would probably have started harvesting on or about 27 November 1995. I infer that once harvesting commenced he would have proceeded continuously without any breaks at weekends except for two days at Christmas. There were thus 28 potential harvesting days. However, there was evidence that the area was likely to experience thunderstorms during this period. Indeed Mr Gangemi, in his written statement to the insurance assessor, referred to a storm on 13 and 14 December 1995. I have considered whether I should take into account that there may have been days when wet weather precluded harvesting. However, Mr Lester’s team also encountered wet weather. It is possible that Mr Gangemi would not have been satisfied with that rate of progress on Mr Cutri’s part, and may have taken steps to expedite the harvest (such as engaging a contractor to do part of the work) so that the crop was off the farm before Christmas. However, there was no evidence to that effect. I find that, on a balance of probabilities, if the respondent had not breached the Contract by delivering the harvester in a condition in which it could not be used for harvesting, there would have been some crop left exposed to the hailstorm, but not as much as 700 acres. On a strictly mathematical basis the range of figures for the area of crop which Mr Cutri would have still to harvest is between 133 and 600 acres. (Either 2 days remaining out of 30 days or 12 days remaining out of 40 days). But the assessment of between 30 and 40 days is, of necessity, an imprecise one. Mr Cutri might have picked up speed as he gained experience. My assessment is that it would be reasonable to have expected the area remaining on 27 December 1995 as being about 300 acres. Accordingly, my conclusion is that the hailstorm caused loss in the form of a diminished yield from some 400 (700 - 300) acres of wheat. But for the respondent breaching the term in the Contract which bound it to put the harvester in a harvestable condition, the applicant would not have suffered that loss.
This is a situation where there are two causes of loss, namely the breach of Contract and the hailstorm. In those circumstances the law appears to be that, subject to the question of remoteness the applicant may recover if the breach of contract was “a” cause of the damage. I say “appears to be” because, for example, one authority which is frequently cited for that proposition [Simonius Vischer & Co v Holt and Thompson [1979] 2 NSWLR 322 at p 346 - a decision of the Court of Appeal of New South Wales] might be read as requiring something more. At that page Samuels JA referred to the correct principle as being that stated in Chitty on Contracts General Principles, 23rd ed., p 670; par 1448 in the following terms:
“If a breach of contract is one of two causes, both co-operating and both of equal efficacy in causing loss to the plaintiff, the party responsible for the breach is liable to the plaintiff for that loss.” (Emphasis added)
His Honour observed that that statement was supported by what was said by Lord Wright (with whom Lord Atkin agreed) in Smith Hogg & Co Ltd v Black Sea & Baltic General Insurance Co Ltd [1940] AC 997 at p 1007, viz
“The sole question, apart from express exception, must then be: ‘Was that breach of contract “a” cause of the damage.’ It may be preferred to describe it as an effective or real or actual cause though the adjectives in my opinion in fact add nothing. If the question is answered in the affirmative the shipowner is liable though there were other co-operating causes ...”
Authority to like effect can be found in another decision of the New South Wales Court of Appeal, Alexander v Cambridge Credit Corporation Ltd (1987) 9 NSWLR 310. In that case the Court, by a majority, held that there was no causal connection between the breach of contract by the auditors and the damage sustained by the company. The case was an unusual one - see for example the circumstances referred to by McHugh J at pp 358-359. The headnote to the case suggests that Mahoney JA disagreed with the statement of principles which the reporter extracted from the reasons for judgment of Glass JA and McHugh JA. My reading of Mahoney JA’s reasons for judgment suggests that the divergence was only in relation to the general application of the “but for” test. In my view, the relevant portion of the headnote provides a very useful encapsulation of the legal position. It reads:
“(By Glass JA and McHugh JA, Mahoney JA contra) to establish a causal connection between a breach of contract and the damage suffered, a plaintiff needs only to show that the breach was a cause of the loss. This is to be decided by the application of commonsense principles. In general, the application of the “but for” test will be sufficient to prove the necessary causal connection. But that test is only a guide. The ultimate test is whether, as a matter of commonsense, the relevant act or omission was a cause.”
But for the hailstorm on or about 27 December 1995 the applicant would not have suffered the loss to which I have referred above. The hailstorm can thus be described as an event consecutive to the respondent’s breach of contract. It may also be described as an intervening event. The question is, whether on the evidence,
“... it is proper to think that the intervening event is in a practical commonsense way the only cause of the loss to the exclusion of the earlier event ...” per Glass JA in Alexander at p 315.
In my view, the answer to that question is no. I consider that the respondent’s breach of contract remained, in a practical commonsense way, a cause of the loss which flowed from the hailstorm. The respondent contracted to provide a harvester in harvestable condition. It failed to honour that obligation. That directly resulted in a delay in taking up the harvest which in turn resulted in 400 of the 700 acres of the wheat crop being at risk which otherwise would not have been at risk when the hail fell on 27 December 1995. I find that there was sufficient connection between the loss then sustained for the respondent’s breach of contract to be regarded as a cause of that loss. I now turn to the question of remoteness.
REMOTENESS
The authorities on the matter of remoteness of damage are most usefully discussed in Carter and Harland (3 ed) at pp 777-783 and I acknowledge my indebtedness to the authors. The cases do not clearly establish the degree of likelihood of a particular head of loss before it can be said that the damages claimed“...may fairly and reasonably be considered [as] arising naturally, i.e., according to the usual course of things, from such breach of contract itself ...”. [The first limb of the rule in Hadley v Baxendale (1854) 9 Ex. 341 at p 354.]
As Mason CJ observed in Baltic Shipping Co v Dillon (1993) 176 CLR 344 at p 364 the rule in Hadley v Baxendale presents a somewhat narrower test than that posed by the concept of foreseeability. I propose to apply in this matter the principle expressed by Lord Reid in Koufos v C.Czarnikow Ltd [1969] 1 AC 350 at p 385 as adopted by Samuels JA in Simonius Vischer and Brennan J in Baltic Shipping Co. In the former case Samuels JA (at p 363) accepted a proposition of principle formulated as follows:
“... an award of damages for breach of contract should compensate for such losses as may fairly and reasonably be considered to arise according to the usual course of things from such a breach, or as may reasonably be supposed to have been in the contemplation of the both parties as a not unlikely result of such a breach.”
In the latter case (at p 368) Brennan J noted that the principle in Koufos had been adopted by the High Court of Australia in three decisions, namely Wenham v Ella (1972) 127 CLR 454 at 471; Burns v M.A.N. Automotive (Aust.) Pty Ltd (1986) 161 CLR 653 at 667; The Commonwealth v Amann Aviation Pty Ltd (1991) 174 CLR 64 at pp 92, 99. Brennan J then set out, with apparent approval, the rules which his Honour said had been merged into a single principle expressed by Lord Reid in Koufos in the following terms:
“The crucial question is whether, on the information available to the defendant when the contract was made, he should, or the reasonable man in his position would, have realised that such loss was sufficiently likely to result from the breach of contract to make it proper to hold that the loss flowed naturally from the breach or that loss of that kind should have been within his contemplation.”
I now turn to apply that principle to the facts of the present matter. In short, how likely was it that if the respondent delivered an unharvestable harvester then the harvesting would be delayed and hail damage would be caused to the wheat crop?
If one concentrated on Mr Tapp’s evidence based on the records from the Bureau of Meteorology, then one would be tempted to conclude that the hailstorm loss was not sufficiently likely to result from the breach of the Contract to make it proper to hold that it flowed naturally from that breach, or that loss of that kind should have been within the respondent’s contemplation. I do not think that it is safe to rely solely on Mr Tapp’s evidence. I say this because the Bureau’s records are based purely on the observation of one person filing reports from Bencubbin, 50 kilometres from the applicant’s farm. Mr Tapp said that hail tended to be localised. Mr Tapp acknowledged that hail, by its nature, was likely to be under-recorded because the observer needs either to hear it or see it. Overnight hail may not be recorded.
Having regard to the other evidence which I have summarised above, I consider that although hail loss would not fairly and reasonably be considered as arising according to the usual course of things from the respondent’s breach, it was sufficiently prevalent that it should have been within the respondent’s contemplation. The respondent conducted its business as a trader in agricultural machinery at Moora, a wheat belt town. Its customers included many wheat farmers (Mr Hyde estimated that before he met Mr Gangemi he had sold somewhere between 250-300 harvesters). He must have acquired a reasonably good knowledge of the circumstances applying in the wheat farming area from which his customers were drawn. This was referred to in evidence as “the wheat belt”. I refer to his evidence, summarised above, on the subject of hailstorms in the wheat belt. Despite Mr Hyde’s emphatic rejection of the proposition I think that, given the evidence from the other witnesses which I have summarised above, it should have been in his contemplation (and thus in the respondent’s contemplation) that if he delivered a harvester in unharvestable condition to the applicant a not unlikely result of the inevitable delay in harvesting would be crop damage by hailstorm. I find that the applicant is entitled to recover damages under this head of loss.
QUANTIFYING THE HAILSTORM LOSS
Mr Lester estimated that he and his team harvested between 800 kg to one tonne per hectare from the first 1300 acres harvested.In respect of the yield from the final 700 acres Mr Lester said:
“It was a fair bit less. It would’ve been down point 4, or point 6 of a tonne per hectare something like that. That’s without actually measuring it. But, you get a fair idea of what you’re harvesting, yes.”
The applicant had farmed wheat on the property during the two previous years. It adduced no evidence about the yields achieved during those years. Mr Meney gave evidence that he looked at the applicant’s crop when he first went over to assist Mr Cutri. I infer from other evidence that this would have been on or about 21 November 1995. He said that at that stage he assessed the crop as being 1.2 tonnes per hectare.
Mr W J Chesnutt, counsel for the respondent, submitted that the evidence concerning the lost yield showed that there was a scale of yields from which damages could be assessed. At the high end of the scale there was Mr Meney’s estimate of 1.2 tonnes per hectare in November 1995 compared with Mr Lester’s estimate of .4 tonnes per hectare after the hailstorm. As Mr Chesnutt pointed out, this was a difference of .8 tonnes per hectare. I disagree with the calculation because I disagree with Mr Chesnutt’s interpretation of Mr Lester’s evidence at T177. When Mr Lester said “it would have been down .4 or .6 of a tonne per hectare ...” I took him to mean that there had been a reduction of between .4 and .6 of a tonne per hectare in the yield. Earlier in his evidence (at T175) Mr Lester said that the later paddocks which he harvested yielded “probably .5 tonnes per hectare”. This is consistent with a drop of between .4 and .6 of a tonne per hectare. Mr Chesnutt contended that the low end of the scale was the difference between .8 tonnes per hectare (Mr Lester’s lowest estimate pre-hailstorm) and .6 tonnes per hectare (Mr Lester’s highest estimate post-hailstorm - the transcript at T284 shows that Mr Chesnutt referred to a different figure, but it is clear what he meant) i.e. .2 tonnes per hectare. For the same reasons, I disagree with Mr Chesnutt’s calculations. The lower end of the scale would appear to be Mr Lester’s estimate of a loss of .4 of a tonne per hectare. Mr Chesnutt suggested that perhaps the fairest way to make the calculation was to average the post-hailstorm yield at .5 of a tonne per hectare. I accept that submission. It is supported also by Mr Lester’s estimate (at T175) of .5 of a tonne per hectare yield post the hailstorm. I prefer Mr Lester’s estimate of the pre-hailstorm yield being achieved on the first thirteen hundred acres, to Mr Meney’s estimate. Mr Lester was on the applicant’s property far longer than Mr Meney and was directly involved in harvesting the wheat crop. I accept his range of the pre-hailstorm yield of .8 tonne to one tonne per hectare. I shall take the middle figure i.e. .9 tonne per hectare and deduct the actual yield of .5 tonne per hectare to reach an estimated loss of .4 tonne per hectare. I have found that 400 acres (162 hectares) of the 700 acres was the area which but for the respondent’s breach of the Contract would not have been damaged by hail. In round terms I assess the loss at 65 tonnes of wheat.
Mr G P Headland, a business service officer with the Australian Wheat Board, gave evidence on behalf of the applicant. He said that there were two varieties of wheat, namely Eradu and Gutha. The price for Eradu in the 1995/1996 year was $231.98 per tonne. The price for Gutha in the same year was $236.83 per tonne. The Australian Wheat Board records showed that a load of Gutha wheat had been delivered on behalf of the applicant to the wheat bin at Wialki. There was no other evidence of the type or types of wheat which formed the wheat crop. Mr Chesnutt invited me to average those two prices and I do so to reach a price of $234.40. The resultant figure is $15,236
CONCLUSION
For the above reasons there will be judgment for the applicant against the respondent for damages totalling $35,706. That sum is calculated as follows:For repairs to the harvester: $ 7,500.00
Nett harvesting contractor expense $12,970.00
Loss of crop $15,236.00
Total : $35,706.00
In its application the applicant seeks interest. Section 51A of the Federal Court of Australia Act 1976 (Cth) relevantly provides that, unless good cause is shown to the contrary, there should be judgment for interest in accordance with the terms provided in that section. No good cause has been shown to the contrary. In my view, the applicant should have an award of interest upon the sum of its damages, calculated from the date of filing its application, at the rate from time to time payable in respect of judgments of this Court. There will be orders accordingly.
I certify that this and the preceding twenty-six (26) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Carr
A/g Associate:
Dated: 31 October 1997
Counsel for the Applicant: Mr W J Chesnutt Solicitors for the Applicant: Messrs Mark Andrews & Associates Counsel for the Respondent: Mr A J Camp Solicitors for the Respondent: Messrs Atkins & Co Date of Hearing: 25, 26, 27 & 28 August 1997 Date of Judgment: 31 October 1997
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