Pangallo Estate Pty Ltd v Killara 10 Pty Ltd - [2007] NSWSC 1528

CITATION: Pangallo Estate Pty Ltd & ors v Killara 10 Pty Ltd [2007] NSWSC 1528

HEARING DATE(S): 20-21 December 2007

JURISDICTION: Equity Division
Expedition List

JUDGMENT OF: Brereton J

EX TEMPORE JUDGMENT DATE: 21 December 2007

DECISION: Contract was a bailment for work and labour; property did not pass to winemaker.

CATCHWORDS: PERSONAL PROPERTY – Bailment – wine – contract for winemaking services – growers deliver grapes to winemaker – winemaker’s lessee re-enters – claims to be entitled to wine – whether contract between growers and winemaker bailment for work and labour, or sale and resale of goods – whether property passed to winemaker.

LEGISLATION CITED: (NSW) Civil Procedure Act 2005, s 93

CASES CITED: Associated Alloys Pty Ltd v Metropolitan Engineering & Fabrications Pty Ltd (1996) 20 ACSR 205
Caltex Oil (Australia) Pty Ltd v The Dredge "Willemstad" (1976) 136 CLR 529
Chapman Bros v Verco Bros & Co Ltd (1933) 49 CLR 306
Commissioner of Internal Revenue v San Carlos Milling Co Ltd (1933) 63 F (2d) 153
Deta Nominees Pty Ltd v Viscount Plastic Products Pty Ltd [1979] VR 167
Farnsworth v Federal Commissioner of Taxation (1949) 78 CLR 504
Kansas Flour Mills Co v Board of Commissioners of Harper County (1927) 54 Am LR 1164
Lamkin v RH Binder Pty Ltd (1984) ASC 55-354
Lee v Griffin (1861) 121 ER 716
Re S Davis & Company Ltd [1945] Ch 402
South Australian Insurance Co v Randell (1869) LR 3 PC 101
Texts:
Corpus Juris Secundum
Halsbury's Laws of England
N E Palmer, Bailment
Sackville & Neave, Property Law
Williston on Contracts

PARTIES: Pangallo Estate Pty Ltd (first plaintiff)
Pasquale Barbalace (second plaintiff)
Vanda Barbalace (third plaintiff)
Killara 10 Pty Ltd (defendant)

FILE NUMBER(S): SC 4665/07

COUNSEL: Mr G Sirtes (plaintiffs)
Mr D Allen (defendant)

SOLICITORS: Cara Marasco & Co (plaintiffs)
Catalyst Legal (defendant)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
EXPEDITION LIST

BRERETON J

Friday 21 December 2007

4665/07 Pangallo Estate Pty Ltd & 2 ors v Killara 10 Pty Ltd

JUDGMENT (ex tempore)

1 HIS HONOUR: By summons filed on 20 September 2007 the plaintiffs Pangallo Estate Pty Limited, Mr Pasquale Barbalace and Ms Vanda Barbalace claim against the defendant Killara 10 Pty Limited a declaration that Killara 10 has no ownership or immediate right to possession of various wines then said to be situate at Killara 10's winery; an order pursuant to (NSW) Civil Procedure Act 2005, s 93, for delivery up of those wines; and, alternatively, damages for conversion. Under interlocutory arrangements made between the parties, such of the wines as Killara 10 accepts were then in the winery have been delivered up to the plaintiffs, leaving for determination whether the plaintiffs were the true owners of the wines and thus entitled to them; if not, they must account for the proceeds to Killara 10. The essential issues are:

(1) Whether the plaintiffs delivered their grapes to the winemaker Letitia Cecchini – who occupied the winery as tenant under…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Pangallo Estate Pty Ltd v Killara 10 Pty Ltd

Details

AGLC: Pangallo Estate Pty Ltd v Killara 10 Pty Ltd [2007] NSWSC 1528
Case: [2007] NSWSC 1528
Decision Date: 21 December 2007

CaseChat Overview and Summary

The dispute in Pangallo Estate Pty Ltd v Killara 10 Pty Ltd concerns the ownership of wine produced by a winemaking company from grapes delivered by vineyard owners. The case was heard in the Supreme Court of New South Wales. The plaintiff, Pangallo Estate Pty Ltd, is a winemaking company that entered into contracts with grape growers for winemaking services. The defendant, Killara 10 Pty Ltd, is the company that leased the premises where Pangallo Estate conducted its winemaking operations. The growers delivered grapes to Pangallo Estate, and the winemaker subsequently produced wine. However, after the defendant re-entered the premises, it claimed entitlement to the wine, arguing that the contract between the growers and Pangallo Estate constituted a bailment for work and labour rather than a sale and resale of goods.

The central legal issue the court had to address was whether the contract between the grape growers and Pangallo Estate constituted a bailment for work and labour, which would imply that the property in the wine remained with the growers, or if it amounted to a sale and resale of goods, thereby transferring the property to Pangallo Estate. The court needed to determine whether the winemaker had the right to claim ownership of the wine produced from the delivered grapes, particularly in light of the re-entry by the defendant, who was the lessee of the premises.

The Supreme Court of New South Wales ruled that the contract between the grape growers and Pangallo Estate was a bailment for work and labour, not a sale and resale of goods. This determination was based on the nature of the relationship and the terms of the agreement, which clearly outlined the winemaking services to be provided. Consequently, the property in the wine remained with the grape growers, and Pangallo Estate did not acquire ownership of the wine. The court held that the defendant, as the lessee who re-entered the premises, had no entitlement to the wine. The ruling affirmed the growers' claim to the wine, as the winemaker had not legally obtained ownership through the terms of the contract.

The final orders of the court were that Pangallo Estate had no right to claim ownership of the wine produced from the delivered grapes, and the property remained with the grape growers. The court also determined that Killara 10 Pty Ltd had no entitlement to the wine upon re-entering the premises. This decision clarifies the nature of winemaking contracts and the implications for property rights in such arrangements.

Orders