Riverina (Australia) Pty Ltd v Flavin Holdings Pty Ltd
[2006] QDC 194
•7 July 2006
DISTRICT COURT OF QUEENSLAND
CITATION:
Riverina (Australia) Pty Ltd v Flavin Holdings Pty Ltd & Ors [2006] QDC 194
PARTIES:
RIVERINA (AUSTRALIA) PTY LTD (ACN 010 755 254)
(Plaintiff)
v
FLAVIN HOLDINGS PTY LTD (ACN 003 447 345)
(First Defendant)
And
MICHAEL RICHARD DREWITT (Second Defendant)
And
HELEN DIANNE DREWITT (Third Defendant)
FILE NO/S:
1550/04
DIVISION:
Civil
PROCEEDING:
Trial
ORIGINATING COURT:
District Court
DELIVERED ON:
7 July 2006
DELIVERED AT:
Brisbane
HEARING DATE:
23 August 2005
JUDGE:
Tutt DCJ
ORDER:
1. Judgment for the plaintiff against the defendants or either of them for the sum of $81,602.87 plus interest of $32,072.37 making a total of $113,675.24.
2. The defendants or either of them pay the plaintiff’s costs of and incidental to the proceeding, including reserved costs if any, to be agreed or assessed on the standard basis under the District Court scale.
CATCHWORDS:
Claim for monies owing – agreement between parties for delivery of stockfeed – whether defendants liable under credit agreement and guarantee for unpaid amounts.
COUNSEL:
Mr R Derrington SC for the plaintiff.
SOLICITORS:
Jones King Lawyers for the plaintiff.
Defendants self-represented.
Introduction
Riverina (Australia) Pty Ltd (“the plaintiff”) claims the principal sum of $81,602.87 plus interest from Flavin Holdings Pty Ltd (“Flavin”), Michael Richard Drewitt and Helen Diane Drewitt (“the Drewitts”) for monies due and owing to the plaintiff for “goods” sold and delivered by it to Flavin between the months of October 2003 and March 2004 inclusive; the “goods” being “stockfeed”.
At all material times Flavin was a duly incorporated company of which the Drewitts were both directors and share-holders.
The plaintiff’s business consists of the manufacture and sale of stock feeds and agricultural products and in respect of the subject matter of this proceeding, operated out of its Warwick premises.
The basis of the plaintiff’s claim against Flavin is that Flavin executed a credit application with the plaintiff in relation to the supply of stockfeed, in particular “pig feeds” namely “Pig Finisher Pellet” and “Pig Weaner Crumble”[1] on or about 16 December 2003[2].
[1]T14 line 48.
[2]See date on the application for credit account which is Exhibit 12.
The basis of the plaintiff’s claim against the Drewitts is that they guaranteed Flavin’s indebtedness to the plaintiff pursuant to a guarantee and indemnity agreement signed contemporaneously with the credit application.
A summary of the outstanding debt and its particulars is as follows:
Date Invoice No. W/B Delivery Date Balance Payment Due Date 27/02/2004
82717
15361
17/12/2003
$5,240.69
31/01/2004
27/02/2004
82718
15633
29/12/2003
$9,947.10
31/01/2004
27/02/2004
82719
15931
8/01/2004
$9,661.78
29/02/2004
27/02/2004
82720
16288
21/01/2004
$9,983.50
29/02/2004
26/03/2004
83183
16594
3/02/2004
$9,582.31
31/03/2004
26/03/2004
83184
16975
16/02/2004
$9,359.53
31/03/2004
26/03/2004
83186
17203
26/02/2004
$9,474.22
31/03/2004
26/03/2004
83187
17480
8/03/2004
$9,190.47
30/04/2004
26/03/2004
83192
17723
17/03/2004
$9,163.27
30/04/2004
$81,602.87
Flavin and the Drewitts, in the first instance, filed a defence to the plaintiff’s claim denying that Flavin had been supplied any goods by the plaintiff or alternatively that the goods supplied were unfit for the purpose for which they were intended, which was known to the plaintiff and a counterclaim was pleaded against the plaintiff claiming damages and interest.
The original defence and subsequent amended defences filed on behalf of Flavin and the Drewitts alleged that the contracting party with the plaintiff was the company Kurobuta Pork (Australia) Pty Ltd (“Kurobuta”) of which Michael Robert Drewitt is also a director with Flavin being a shareholder, not Flavin itself.
At trial the legal representatives of Flavin and the Drewitts withdrew from the proceeding and Flavin and the Drewitts were represented by the second defendant Michael Richard Drewitt (“MRD”) who abandoned any counterclaim[3] and confirmed that the only issue in the proceeding was “…who was the right contracting party…” or in other words who is responsible for the payment of the outstanding indebtedness to the plaintiff.[4]
[3]T8 lines 40-51.
[4]T9 lines 9-15.
The Plaintiff’s Evidence
Evidence was given on behalf of the plaintiff by Glen David Whitton (“Whitton”) that in or about August 2003 MRD telephoned him in respect of the plaintiff “…supplying pigfeeds and also a price for pigfeeds delivered to their property…”[5].
[5]T14 lines 48-50.
Whitton’s evidence was that the plaintiff could not assist MRD at that stage but “around about late September” there was a further conversation between Whitton and MRD and as a result of that conversation Whitton provided a quotation to MRD “…for the supply of Pig Finisher Pellet (and) Pig Weaner Crumble” on 26 September 2003[6]. Whitton’s evidence was that in that conversation Drewitt gave him the account name “Flavin Fresh Pork” which was endorsed on the written quotation.
[6]Exhibit 3.
Whitton then forwarded to MRD a document styled “Application for Credit Account” which is a four-page double-sided document together with a single-page document styled “Guarantee and Indemnity” for signature by the contracting party[7].
[7]Exhibit 5.
This document was not returned to the plaintiff in the short term and after some time Whitton “visited” the Drewitts’ property at Inverell and provided MRD with a second credit application and guarantee and indemnity form for completion. At a later date still[8] Whitton received a veterinary certificate from the “Inverell Vet Clinic” with respect to the “…inclusion of antibiotics or other (sic) for animal management husbandry”[9] which needs to be included in the feed product; this certificate was styled “Riverina Stock Feeds for Flavin Holdings Oakwood Inverell”.
[8]Veterinary Certificate is dated 23 December 2003
[9]T19 lines 35-40.
Supplies of the stockfeed were delivered to the Drewitts’ property at Inverell from October 2003 and although the credit application and guarantee document had not been signed by the Drewitts at this stage, Whitton made arrangements with MRD’s brother (Robert Drewitt) “….to pay by internet banking” and details of the plaintiff’s bank account were forwarded to Robert Drewitt on 14 October 2003[10].
[10]Exhibit 6.
By 5 December 2003 the credit application and guarantee document had not been returned to the plaintiff and again Whitton wrote to “Robert/Michael” (Drewitt) on 5 December 2003 summarising the amount then owing to the plaintiff and seeking the return of “the credit application”[11].
[11]Exhibit 7.
Again on 11 December 2003 Whitton wrote to “Robert Drewitt” seeking the return of “the credit application” and “…payment for the invoices I faxed last Friday”[12].
[12]Exhibit 8.
Whitton again wrote to “Robert Drewitt/Michael Drewitt/Flavin Holdings Pty Ltd” on 12 December 2003 acknowledging payment of an earlier invoice for stockfeed delivered and again requesting the return of the “credit application”[13].
[13]Exhibit 10.
Whitton finally received an incomplete credit application and guarantee document on or about 14 December 2003 from the Drewitts but sent it back to them for completion and it was subsequently returned to Whitton[14]. This document was completed in the name of “Flavin Holdings Pty Ltd” with the trading name “Flavin Holdings” and with “details of proprietors/share holders/partners/directors/etc” as “Michael Richard Drewitt” and “Helen Diane Drewitt”. The “Privacy Consent” endorsement within the document was signed by “Michael Richard Drewitt” and “Helen Diane Drewitt” and the “guarantee and indemnity” document was also signed (albeit with some ambiguity) by “Michael Richard Drewitt” and “Helen Diane Drewitt” guaranteeing the application for credit by “Flavin Holdings Pty Ltd”.
[14]Exhibit 12.
Further order forms received by the plaintiff were tendered in evidence through Whitton headed “Flavin Holdings Pty Ltd”[15] with the first order form from Drewitt containing a reference to “Kurobuta Pork Australia” being dated “30/1/04”[16]. This document also had at the top of the page the words “Flavin Holdings”. A further order form received by the plaintiff on or about 12 February 2004 was headed “for Kurobuta Pork”[17].
[15]Exhibit 13 dated 13 December 2003; Exhibit 14 dated 23 December 2003 and Exhibit 15 dated 18 January 2004.
[16]Exhibit 16.
[17]Exhibit 17.
Whitton’s evidence was that up to this time he had received no indication from MRD that any other entity than Flavin would be accepting responsibility for the payment of the stockfeed to be delivered.
Whitton’s further evidence was that on 25 March 2004 he again visited the Drewitts’ property at Inverell at which time MRD informed him that “they were putting their business into Kurobuta Pork Pty Ltd”[18] and on that day a new “Application for credit account” was completed in the name of “Kurobuta Pork Australia P/L” and signed by MRD. This document was then to be signed by two other persons, namely, Robert Drewitt and Peter James Kakowski, who were also directors of the company Kurobuta Pork Pty Ltd[19]. Whitton’s evidence was that before 25 March 2004 he had not been informed nor had there been any other indication or notification that the company Kurobuta had ordered any stockfeed from the plaintiff.
[18]T34 lines 38-39.
[19]T34 and T35 and Exhibit 18.
By letter dated 30 March 2004[20] the plaintiff summarised the outstanding amounts owing to it on earlier invoices and although the correspondence is addressed to “Mr Michael Drewitt & Mr Robert Drewitt Kurobuta Pork Australia” Whitton’s evidence is that he was instructed by MRD to issue the account in this way as “…that’s how they were going to pay for them”[21].
[20]Exhibit 19.
[21]T35 line 52.
Whitton summarised his evidence by saying that at no time up to March 2004 was he ever informed that the entity responsible for the payment of the stockfeed being delivered to the Drewitts’ property at Inverell was other than Flavin.
Further evidence was adduced on behalf of the plaintiff through the witness Michael James See, the managing director of the plaintiff, conforming the orders received from MRD on behalf of Flavin and the invoices rendered on those orders together with confirmation that the delivery dockets to which the invoices referred showed that the stockfeed was delivered to the Drewitts’ property at Inverell all of which were made out to Flavin.
The Defendants’ Evidence
MRD gave evidence in accordance with a prepared statement which became Exhibit 22 in the trial and confirmed in cross-examination that he “…received physically yourself at your piggery the nine shipments of feed…”[22].
[22]T69 line 17.
MRD accepted in cross-examination that “…the $81,000 worth of feed…was all delivered…” but that “…it was purchased through Kurobuta Pork Australia”[23].
[23]T70 lines 10-15.
MRD stated that Flavin and Kurobuta entered into an arrangement “…about 8 January 04”[24] and that in effect Kurobuta owned “…the pigs and the piggery”[25] and that Flavin was paid a fee “…to house the pigs and grow them on their (Kurobuta’s) behalf”[26].
[24]T76 line 10.
[25]T74 line 32.
[26]T73 line 23.
Evidence was also adduced under cross-examination through MRD that he had confirmed in an email dated 24 December 2003 that under an arrangement between Flavin and Kurobuta “…Flavin Holdings Pty Ltd will control the production side of the operation…Kurobuta will operate as the marketing arm of the business”[27].
[27]Exhibit 23.
In summary, MRD’s evidence was that at all relevant times the responsibility for payment of the stockfeed rested with Kurobuta and not Flavin.
Evidence was also given by a Mr Ransford who had discussions with MRD with respect to a “commercial arrangement”[28] between them which was never finalised. This evidence did not seem to take the matter any further. MRD’s brother Robert Drewitt, a director of Kurobuta, gave evidence but his evidence did not in any material way assist the defendants and if anything confirmed the evidence of the witness Whitton in respect of the credit arrangements between the plaintiff and Flavin[29].
[28]T99 line 7.
[29]T107 to T109 inclusive.
Findings
On a review of all of the evidence in this proceeding I accept the evidence called on behalf of the plaintiff and its witnesses and in particular the evidence of the witness Whitton, as to the contractual arrangements he made with MRD in respect of the orders for and delivery of stockfeed to the Drewitts’ property at Inverell and in all respects where such evidence differs from that of MRD I accept the evidence of Whitton in preference to that of MRD.
I therefore make the following findings:
1. On or about 26 September 2003 the plaintiff offered to supply Flavin, which was accepted by MRD on behalf of Flavin, with stockfeed namely “Pig Finisher Pellet” and “Pig Weaner Crumble” to be delivered to the Drewitts’ property at Oakwood, Inverell NSW.
2. Thereafter between 13 October 2003 and 17 March 2004 the plaintiff delivered stockfeed to the Drewitts’ property on behalf of Flavin in response to orders placed by Drewitt and/or other authorised persons on the various dates set out in Exhibit 2 for which it issued invoices for the respective amounts set out therein.
3. At all material times Flavin accepted responsibility for the payment of the stockfeed invoices and confirmed its acceptance of such responsibility by completing and signing the application for credit account document dated 16 December 2003.
4. The Drewitts signed the guarantee and indemnity document to become guarantors of the credit provided to Flavin by the plaintiff and as such accepted liability to guarantee and indemnify Flavin for all amounts for which Flavin has been provided with credit by the plaintiff and for which the plaintiff has not been paid.
5. That as at the date of trial the amount outstanding to the plaintiff by Flavin was the sum of $81,602.87 as set out in paragraph [6] which remains unpaid.
6. That in accordance Clause 3(d) of the credit application form the plaintiff is entitled to interest at the rate of 18% per annum on any amount remaining unpaid until payment of such amount is made to be calculated from the due date of payment.
Orders
In summary therefore I make the following orders:
1. I give judgment for the plaintiff against the defendants or either of them for the sum of $81,602.67 plus interest on the principal sum at the rate of 18% per annum from the 30 April 2004 being the due date for payment of the final invoice delivered by the plaintiff to Flavin to the date hereof. On my calculations the interest component amounts to the sum of $32,072.37 calculated for a period of 2 years and 67 days to the date of judgment.
2. I further order that the defendants or either of them pay the plaintiff’s costs of and incidental to the proceeding including reserved costs if any to be agreed or assessed on the standard basis under the District Court scale.
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