Roadwest Transport Equipment and Sales Pty Ltd v Hydraulic Hoist and Winch Sales (WA) Pty Ltd - [2005] WADC 205

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION: PERTH

CITATION: ROADWEST TRANSPORT EQUIPMENT & SALES PTY LTD -v- HYDRAULIC HOIST AND WINCH SALES (WA) PTY LTD [2005] WADC 205

CORAM: MARTINO DCJ

HEARD: 5-9, 12 SEPTEMBER 2005

DELIVERED : 4 NOVEMBER 2005

FILE NO/S: CIV 1110 of 2002

BETWEEN: ROADWEST TRANSPORT EQUIPMENT & SALES PTY LTD (ACN 063 705 359)
Plaintiff
AND
HYDRAULIC HOIST AND WINCH SALES (WA) PTY LTD (ACN 009 347 951)
Defendant

Catchwords:

Contract - Sale of goods - Conditions and warranties - Torts - Negligent misstatement - Trade practices - Misleading or deceptive conduct

Legislation:

Sale of Goods Act 1895

Trade Practices Act 1974

Result:

Plaintiff's claim dismissed

Representation:

Counsel:

Plaintiff: Mr P G McGowan
Defendant: Mr G A Rabe

Solicitors:

Plaintiff: Wilson & Atkinson
Defendant: Mullins Handcock

Case(s) referred to in judgment(s):

Baldry v Marshall [1925] 1 KB 260
Byrne v Australian Airlines Ltd (1995) 185 CLR 410
Con‑Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Australia) Ltd (1986) 160 CLR 226
Grant v Australian Knitting Mills Ltd & Anor (1935) 54 CLR 49
Hospital Products Ltd v United Surgical Corporation (1984) 156 CLR 41

Case(s) also cited:

Ashford Shire Council v Dependable Motors Pty Ltd (1959) 101 CLR 265
Ashington Piggeries Ltd v Christopher Hill Ltd [1972] AC 441
Astley v Austrust Ltd (1999) 197 CLR 1
Bryan v Maloney (1995) 182 CLR 609
Castlemaine Tooheys v Carlton & United Breweries (1987) 10 NSWLR 468
Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337
Commonwealth Bank of Australia v Smith (1991) 42 FCR 390
David Jones Ltd v Willis (1934) 52 CLR 110
Demagogue Pty Ltd v Ramensky (1992) 39 FCR 31
Dick Bentley Productions Ltd v Harold Smith (Motors) Ltd [1965] 2 All ER 65
Ellul v Oakes (1972) 3 SASR 377
Esanda Finance Corporation Ltd v Peat Marwick Hungerfords (1997) 188 CLR 241
Esso Petroleum Co Ltd v Mardon [1976] QB 801
Fox Pty Ltd v Rayner [1978] Qd R 250
Frank v Grosvenor Motor Auctions Pty Ltd [1960] VR 607
Fraser v NRMA Holdings Ltd (1995) 55 FCR 452
Harling v Eddy [1951] 2KB 739
Helicopter Sales (Aust) Pty Ltd v RotorWork Pty Ltd & Anor (1974) 132 CLR 1
L Shaddock & Associates Pty Ltd v Parramatta City Council (No 1) (1981) 150 CLR 225
Lockhart v Osman [1981] VR 57
Morgan Crucible Co plc v Hill Samuel & Co Ltd (1991) Ch 295
Mutual Life & Citizens Assurance Co Ltd v Evatt (1970) 122 CLR 628
Norris v Sibberas [1990] VR 161
Perre v Apand Pty Ltd (1999) 198 CLR 180

MARTINO DCJ: The plaintiff ("Roadwest") manufactures and repairs heavy transport equipment, including trailers. The defendant ("Hydraulic Sales") carries on business selling hydraulic equipment. In 1999 Hydraulic Sales was a supplier of hydraulic equipment to Roadwest. Mr John Adams is the general manager of Hydraulic Sales.
In 1999 Mr John Freeman acquired the business of ROC Hydraulics (Aust) Pty Ltd ("ROC Hydraulics"). From that time Hydraulic Sales was the distributor of ROC Hydraulics products in Western Australia.
The managing director of Roadwest is Mr Peter Lombardi. Until late 1999 all the tipping trailers manufactured by Roadwest were end tipping trailers. In the mid 1990s, Mr P Lombardi identified a market for side tipping trailers.
Tipping trailers use hydraulic cylinders to power the tipping function. An assembly that contains a hydraulic cylinder that tips a trailer is sometimes called a hoist. At times the word hoist and the word cylinder are used interchangeably. The fully extended length of a hydraulic cylinder is called its stroke. Industry practice is to describe the stroke of a hydraulic cylinder in imperial measurements. End tipping trailers generally use one single acting hydraulic cylinder with multiple stages, placed at the front of the trailer. A single acting hydraulic cylinder uses power to extend the cylinder but not to return the cylinder to its un‑extended (or closed) state, the force of gravity performing that function. In a double acting cylinder, power is used for both functions. A cylinder with multiple stages has more than one sleeve. As the hydraulic fluid is injected into the base of the cylinder one sleeve extends. Once it is fully extended another sleeve extends. When all sleeves are fully extended the cylinder is at its maximum length.
Side tipping trailers can have one or two hydraulic cylinders. As the length of a trailer is greater than its width the stroke of a hydraulic cylinder for an end tipping trailer is longer than the stroke of a cylinder for a side tipping trailer. The stroke of a cylinder for an end tipping trailer is approximately 250 inches and for a side tipping trailer approximately 43 to 44 inches.
In 1999 and 2000 Roadwest purchased from Hydraulic Sales ROC Hydraulics hydraulic cylinders and used those cylinders in the manufacture of 12 side tipping trailers. The purchases were made pursuant to seven separate orders from Roadwest.
The ROC Hydraulic cylinders it purchased were ROC DA6-1-43.5. That model of cylinder had a trunnion collar at its base and was supported by two trunnions attached to that collar. The cylinder assembly was retained by feet which fitted over the trunnions and were bolted to the trailer chassis. It was a double acting cylinder with one stage. When hydraulic fluid was injected into the raise port the cylinder rod extended. When hydraulic fluid was injected into the lower port the cylinder rod retracted.
The cylinder's stroke was 43.5 inches. That stroke is suitable for use in side tipping trailers. It is insufficient for use in end tipping trailers.
Roadwest claims that the cylinders were not fit for the purpose for which it acquired them. It claims from Hydraulic Sales damages for breach of contract, negligent misstatement and for misleading or deceptive conduct in trade or commerce in contravention of the Trade Practices Act 1974.

The plans for Roadwest's side tipping trailers

In 1997 Mr P Lombardi approached an engineering draughtsman, Mr Graham Dyke, and engaged him to prepare plans for a side tipping trailer. Mr Dyke had previously worked for Howard Porter Pty Ltd, a company that manufactured side tipping trailers.
By facsimile dated 6 November 1997 Mr Dyke forwarded to Roadwest draft plans for a side tipping trailer together with several recommendations and questions. Mr Dyke informed Roadwest that a tipping trailer could have one hoist or two and that they could be single acting or double acting. He recommended the use of two hoists. He also informed Roadwest that one hoist would be located with a box at the centre of the trailer body and that if two hoists were used there was an option of using hoist boxes or locating them at the ends of the trailer. In the facsimile Mr Dyke proposed the use of ROC cylinders for the hoists and to operate the doors.
Mr Dyke's completed plans are dated 27 November 1997. They are for a trailer with two double acting hoists, one at each end of the trailer and contain the following detail:
"HOIST DETAILS:
ROC DA6-1-43.5 c/w TOP CLEVIS ACL 511
BTM FEET 5065 (90 HIGH)
CLOSED LENGTH = 1405 + 15 EXTN = 1420
OPEN LENGTH = 1405 + 1100 (MIN) = 2505"
In or around August 1999 Mr P Lombardi saw advertisements by local authorities wishing to purchase side tipping trailers. He decided to manufacture side tipping trailers. He gave the plans prepared by Mr Dyke to Roadwest's engineering manager, Mr Ravi Subramaniam. He told Mr Subramaniam that he wished to use those plans as a basis for side tippers to be manufactured by Roadwest. He instructed Mr Subramaniam to put the plans into Roadwest's computer using computer aided drafting software ("CAD"). He told Mr Subramaniam to be very thorough because the plans came from somebody else and that Mr Subramaniam was to make sure everything worked correctly before Roadwest started to build side tipping trailers. He also instructed Mr Subramaniam to source all the major components and follow through the construction of the trailer.
Placing plans onto a computer with CAD involves redrawing the entire plans in full scale. Once that is done it is possible to make changes to the plans using the software very quickly and easily. The software also enables an operator to simulate the operation of the subject of the plans, to identify complications or problems in its operation.
Mr Subramaniam placed the plans onto a computer using CAD. When he did so he found "a few minor discrepancies, nothing major, a few dimensional changes" (T207-208). He found these problems by using the software to simulate the operation of the trailer. The problems were:
"One of the door rams was a few millimetres out. I think 15 or 20 millimetres out which didn't allow the door to fully open, and then we changed a few other things to make it easier to construct the trailer, but there was nothing major." (T208)
He told Mr P Lombardi what he had found. Mr P Lombardi told Mr Subramaniam to fix the problems and to build the trailers.

The communications between Roadwest and Hydraulic Sales

In or around September 1999 Mr Subramaniam telephoned Mr Matthew Tankard, a salesman employed by Hydraulic Sales. Mr Subramaniam told Mr Tankard that Roadwest were building side tipping trailers and that it needed some hydraulic cylinders. He gave to Mr Tankard the part number that he required. The part number he gave to him was the part number that was contained in the plans prepared by Mr Dyke ie ROC DA6-1-43.5. Mr Subramaniam knew from his previous dealings with Hydraulic Sales and from his conversation with Mr Tankard that this part number signified a hydraulic hoist manufactured by ROC Hydraulics with a bore of 6 millimetres, that operated on one stage and had a stroke of 43.5 inches. Mr Subramaniam also gave to Mr Tankard the open and closed dimensions of the cylinder that were on the plans prepared by Mr Dyke.
Mr Subramaniam asked Mr Tankard if he had a listing for that part, by which he meant and Mr Tankard understood him to mean if the part was in the catalogue of ROC Hydraulics parts. Mr Tankard told Mr Subramaniam that he did have a listing for the part. Mr Subramaniam asked Mr Tankard if Mr Tankard could get the manufacturer's drawings for the cylinders. He wished to have those drawings so he could ensure that he had the correct dimensions for the part. He intended to put those dimensions into the drawings he had prepared using CAD.
Mr Tankard said he would obtain the drawings and get back to Mr Subramaniam.
Mr Subramaniam's evidence was that Mr Tankard requested a copy of a drawing. His evidence in chief about the drawing that he sent to Mr Tankard was:
"Yes, it was - this was the information he asked for where we sent him the information there. I'd already given him the physical dimensions of the cylinder, just sent him a drawing of the cylinders in work." (T211)
In cross examination he said that Mr Tankard asked for a drawing of the layout of the tipper, and that Mr Tankard asked for a drawing of the cylinder. At that time Mr Subramaniam had not completed putting the plans for the side tipping trailer onto computer. His evidence was that he faxed to Mr Tankard a copy of a drawing that he had prepared, which did not have the tipper's dimensions shown on it. He faxed a copy of a drawing of the side tipper showing the cylinder to Mr Tankard because that was the only drawing of the cylinder that Mr Subramaniam had. Mr Tankard denied that he asked for or received a copy of the drawing.
Roadwest does not have a file copy of the fax that Mr Subramaniam said in evidence that he sent to Mr Tankard. Mr Subramaniam's evidence was that it went onto the job file, that the job file was used by many people and he does not know what became of it.
It was Mr Adams' practice in 1999 regularly to visit Roadwest. Mr Subramaniam's evidence was that after his telephone conversation with Mr Tankard he saw Mr Adams at Roadwest's premises. At that time Mr Subramaniam had not received a response to his enquiry to Mr Tankard. Mr Subramaniam's evidence was that Mr Adams asked for a copy of a drawing of the layout of the side tipping trailer and that he printed out an A3 size copy of the same drawing he had faxed to Mr Tankard and gave it to Mr Adams. Mr Adams did not say why he wanted a copy of a drawing of the layout of the side tippers.
Mr Subramaniam also gave evidence that in early October he had not heard back from Hydraulic Sales and so he telephoned the company. He spoke to Mr Adams who told him that Hydraulic Sales had not received the drawings from ROC Hydraulics but that everything would be fine and he asked Mr Subramaniam for a copy of the drawing of the side tipping trailer in A4 size. Mr Subramaniam asked Mr Adams why he needed another copy of the drawing. Mr Adams told him that he could not fax the A3 copy. Mr Subramaniam printed out a copy of the drawing in A4 size and faxed it to Mr Adams.
Mr Adams denied requesting or receiving either drawing. His evidence was that if he needed an A3 size drawing in A4 size, Hydraulic Sales had a photocopier that could perform that function.
On 14 October 1999, by order 13303, Roadwest ordered six cylinders from Hydraulic Sales. The order was for cylinders described as follows:
"ROC DA6-1-43.5 Hoists closed 1420-open 2505"
The order was sent to Hydraulic Sales and signed by Mr John Yates, Roadwest's purchasing officer. He obtained the information to place in the order from Mr Subramaniam.
On 3 November 1999, Mr Tankard sent by facsimile to Mr Subramaniam an ROC Hydraulics drawing of the cylinder assembly for cylinder DA6-1-43.5. That was the first drawing of a cylinder that Mr Subramaniam received. That drawing was not sufficient for Mr Subramaniam's purposes. He required the detail of the feet mounting.
Shortly after he received the facsimile, Mr Subramaniam telephoned Mr Tankard and told him what he required. On 4 November 1999, Mr Tankard sent by facsimile to Mr Subramaniam ROC Hydraulics' drawings of the cylinder, showing the detail that Mr Subramaniam required.
Construction of the side tippers commenced in September 1999. On an occasion in or around late November, Mr Adams was at Roadwest's premises and saw the side tippers being commenced. He said to Mr Subramaniam that they looked good.

The contracts for cylinders

Hydraulic Sales supplied six cylinders pursuant to Roadwest's order 13303 dated 14 October 1999.
By an invoice dated 22 November 1999, it charged Roadwest $14,076.00 for those six cylinders.
By its order 14206 dated 17 January 2000, Roadwest ordered four cylinders from Hydraulic Sales. The order was for cylinders described as follows:
"Hoists ROC 1-43.5"
Hydraulic Sales supplied four cylinders pursuant to that order. By an invoice dated 18 January 2000, it charged Roadwest $9,384.00 for those four cylinders.
By its order 15285 dated 6 April 2000, Roadwest ordered four cylinders from Hydraulic Sales. The order was for cylinders described as follows:
"Hoist side tip feet + top pin"
Hydraulic Sales supplied four cylinders and pins pursuant to that order. By an invoice dated 7 April 2000, it charged Roadwest $9,384.00 for the four cylinders and $72 for the four pins.
By its order 15626 dated 15 May 2000, Roadwest ordered two cylinders and two pins from Hydraulic Sales. The order was as follows:
"Hoists side tipper DA6-1-43.5
Pins"
Hydraulic Sales supplied two cylinders and two pins pursuant to that order. By an invoice dated 17 May 2000, it charged Roadwest $4,692.00 for the two cylinders and $24 for the two pins.
By its order 17311 dated 9 August 2000, Roadwest ordered four cylinders and four pins from Hydraulic Sales. The order was as follows:
"Hoist Side Tip
DA6-1-43.5
Pins"
Hydraulic Sales supplied four cylinders and four pins pursuant to that order. By an invoice dated 9 August 2000, it charged Roadwest $9,384.00 for the four cylinders and $72 for the four pins.
By its order 17845 dated 3 October 2000, Roadwest ordered two cylinders from Hydraulic Sales. The order was as follows:
"ROC Hoist Side Tip"
Hydraulic Sales supplied two cylinders pursuant to that order. By an invoice dated 4 October 2000, it charged Roadwest $4,692.00 for the two cylinders.
By its order 17961 dated 13 October 2000, Roadwest ordered two cylinders from Hydraulic Sales. The order was as follows:
"Side Tip Hoists"
Hydraulic Sales supplied two cylinders pins pursuant to that order. By an invoice dated 16 October 2000, it charged Roadwest $4,692.00 for the two cylinders.

The use of the cylinders in the manufacture of trailers

Roadwest manufactured 12 trailers using cylinders it purchased from Hydraulic Sales. Every trailer manufactured in Australia can be identified by its vehicle identification number ("Vin") which is a number provided by the Federal Office of Road Safety.
Vin 6T9T25WA1X1ADN032
Roadwest supplied this trailer to Apex Rentals Pty Ltd. It used two of the six cylinders supplied by Hydraulic Sales pursuant to Roadwest's order 13303 of 14 October 1999. At trial, Roadwest amended its pleadings to delete its claim for damages in respect of that trailer.
Vin 6T9T25WA1X1ADN033
Roadwest supplied this trailer to Apex Rentals Pty Ltd. It used two of the six cylinders supplied by Hydraulic Sales pursuant to Roadwest's order 13303 of 14 October 1999.
Vin 6T9T25WA1X1ADN035
Roadwest supplied this trailer to the Shire of Yilgarn. It used two of the six cylinders supplied by Hydraulic Sales pursuant to Roadwest's order 13303 of 14 October 1999.
Vin 6T9T25WA1Y1ADN009
Roadwest supplied this trailer to the Shire of Lake Grace. It used two of the four cylinders supplied by Hydraulic Sales pursuant to Roadwest's order 14206 of 17 January 2000.
Vin 6T9T25WA1Y1ADN010
Roadwest supplied this trailer to the Shire of Lake Grace. It used two of the four cylinders supplied by Hydraulic Sales pursuant to Roadwest's order 14206 of 17 January 2000.
Vin 6T9T25WA1Y1ADN017
Roadwest supplied this trailer to the Shire of Kulin. It used two of the four cylinders supplied by Hydraulic Sales pursuant to Roadwest's order 15285 of 6 April 2000.
Vin 6T9T25WA1Y1ADN033
Roadwest supplied this trailer to Apex Rentals Pty Ltd. It used two of the four cylinders supplied by Hydraulic Sales pursuant to Roadwest's order 15285 of 6 April 2000.
Vin 6T9T25WA1Y1ADN034
Roadwest supplied this trailer to Apex Rentals Pty Ltd. It used the two cylinders supplied by Hydraulic Sales pursuant to Roadwest's order 15626 of 15 May 2000.
Vin 6T9T25WA1YX1ADN036
Roadwest supplied this trailer to Patience Bulk Hauling. It used the two cylinders supplied by Hydraulic Sales pursuant to Roadwest's order 17961 of 14 October 1999.
Vin 6T9T25WA1Y1ADN049
Roadwest supplied this trailer to Youngs Earthmoving. It used two of the four cylinders supplied by Hydraulic Sales pursuant to Roadwest's order 17311 of 9 August 2000.
Vin 6T9T25WA1Y1ADN050
Roadwest supplied this trailer to Youngs Earthmoving. It used two of the four cylinders supplied by Hydraulic Sales pursuant to Roadwest's order 17311 of 9 August 2000.
Vin 6T9T25WA1Y1ADN056
Roadwest supplied this trailer to Patience Bulk Handling. It used the two cylinders supplied by Hydraulic Sales pursuant to Roadwest's order 17845 of 3 October 2000.

The failure of cylinders supplied by Hydraulic Sales to Roadwest and communications between Roadwest and Hydraulic

Mr Jack Lombardi, the father of Mr P Lombardi, is a fitter welder and is in charge of repair work carried out at Roadwest's workshop. In early 2000 a side tipping trailer manufactured by Roadwest using cylinders supplied by Hydraulic Sales was brought to the workshop for repairs.
The cylinder's mounting had developed a crack. Mr J Lombardi repaired the mounting and strengthened it using heavier metal. Trailers manufactured by Roadwest continued to have problems with the mountings cracking or bolts that held them in place being pulled out of the mountings.
In or around 2001 Mr J Lombardi telephoned Mr Adams and asked him to come to see the problem that was occurring with the mountings of cylinders in the side tipping trailers. Mr Adams suggested that Mr J Lombardi use thicker bolts. Mr J Lombardi did as Mr Adams suggested, but the same problems continued to occur.

Mr J Lombardi again contacted Mr Adams and asked him to come to Roadwest's workshop. Mr Adams did so. He told Mr J Lombardi that he must be doing something wrong because other manufacturers were not having the same problems. Mr J Lombardi was unable to prevent the failures in the mountings of ROC cylinders in the side tipping trailers.
Mr Yates' evidence was that on one occasion, after there had been a number of failures of cylinders, he spoke to Mr Adams at Hydraulic Sales' premises. He asked Mr Adams what was going on with the cylinders and expressed the view that there must be something wrong and that Mr Adams said to him:
"John, you and me are merely meat in the sandwich. This should be sorted out by ROC." (T247)
Mr Yates was not cross examined as to that evidence and Mr Adams did not deny it. I accept Mr Yates' evidence as to the conversation.
In or around March or April 2001, Mr P Lombardi telephoned Mr Adams and asked Mr Adams what he proposed to do to assist Roadwest with the problems that Roadwest was having with broken mounts on ROC DA6 cylinders. Mr Adams said he would contact Mr Freeman of ROC Hydraulics.
On 25 June 2001, Hydraulic Sales sent by facsimile to Roadwest a facsimile of the same date from Mr Freeman of ROC Hydraulics. That facsimile was in the following terms:
"With reference to Roc Cylinders 1635A0026 - (DA6.1-43.5), I wish to state that the trunions (sic) fitted to the above cylinders, exceeds manufacturers specifications and that the failure was caused by excessive twisting action of the body. The cylinders are designed to tip the body, not to stabilise the body."
When he received that facsimile Mr P Lombardi telephoned Mr Adams and arranged to meet with him approximately a week later. That meeting was held on 3 July 2001 in Mr P Lombardi's office and was attended by Mr P Lombardi, Mr Subramaniam, Mr Yates and Mr Adams.
Mr P Lombardi's evidence of what occurred at that meeting was that they discussed Mr Freeman's facsimile of 25 June 2001. Mr P Lombardi told Mr Adams that after Mr Subramaniam had sent to Mr Adams the initial drawings of the side tipping trailer Mr Adams had told Mr Subramaniam that the ROC cylinders were OK to use in the trailer. Mr Adams told Mr Subramaniam that is what he had been told by Mr Freeman. Mr P Lombardi then spoke on the telephone to Mr Freeman and then Mr Adams spoke to Mr Freeman. After the telephone conversations Mr P Lombardi told Mr Adams that Mr Freeman had told him that the cylinders were not suitable for use in the side tipping trailers in which Roadwest had used them. He also told Mr Adams that what Mr Freeman had said was not what Mr Adams had told Mr Subramaniam. Mr P Lombardi said to Mr Adams that he was either "with us or against us on this matter". The meeting then ended.
On 3 September 2001, Mr P Lombardi wrote to Mr Freeman. Mr P Lombardi sent a copy of that letter to Mr Adams. In the letter Mr P Lombardi wrote that Roadwest had numerous failures of cylinders and requested financial assistance. In the letter Mr P Lombardi wrote:
"During our telephone conversation on July 3rd 2001, you advised us and Mr John Adams repeatedly, the cylinders which were sold to us should never have been used in a side tipping application. However, prior to even purchasing the very first cylinder some 20 months ago, an engineering drawing showing the end profiles of the trailer was sent to yourself via Mr John Adams, who subsequently advised us the cylinders we inquired about would be fine to use in the side tipping application as shown on the drawing. Mr Adams advises us you approved of the cylinder."
Roadwest did not receive a response to that letter from ROC Hydraulics or from Hydraulic Sales.
Mr Subramaniam's evidence as to the meeting was that Mr P Lombardi said to Mr Adams that Roadwest had spent a fair bit of money on the cylinders. Mr Adams suggested to Mr P Lombardi that he telephone Mr Freeman and Mr P Lombardi did so. After speaking to Mr Freeman, Mr P Lombardi said to Mr Adams that he did not understand what was going on because Mr Adams had said that the cylinders were OK to use but Mr Freeman had told him that the cylinders were not suitable for use in side tipping trailers. Mr Adams then took the phone and spoke to Mr Freeman. After that conversation, Mr Adams said he did not understand what ROC Hydraulics were doing and that they said it was OK to use. Mr P Lombardi then said to Mr Adams that somebody was going to pay for it and that he had better decide whose side he was going to take. Mr Adams then said that if ROC Hydraulics had not said they were OK to use, he would not have told Mr Subramaniam to go ahead with using them.
Mr Yates' evidence as to the meeting was that Mr P Lombardi telephoned ROC Hydraulics and said during that telephone conversation:
"So we can't use these cylinders are not good for a side-tipper." (T247)
Mr P Lombardi then handed the telephone to Mr Adams who spoke to the person on the other end of the line. After the telephone conversation, Mr Adams said to Mr Subramaniam or to Mr P Lombardi that he had sent the drawings to ROC Hydraulics who had said that they were OK. Mr P Lombardi then said to Mr Adams:
"Well, this can't go on like this any more. You're either with us or against us on this." (T248)
Mr Adams made no comment and the meeting ended.
Mr Adams' evidence was that at the meeting he made a phone call to Mr Freeman on his mobile telephone. He introduced Mr P Lombardi to Mr Freeman and then handed the phone to Mr P Lombardi. After Mr P Lombardi spoke to Mr Freeman the call ended without Mr Adams speaking to Mr Lombardi on the telephone again. Other than to introduce Mr P Lombardi to Mr Freeman, Mr Adams had no discussion with Mr Freeman. When he received a copy of Mr P Lombardi's facsimile to Mr Freeman dated 3 September 2001, he telephoned Mr P Lombardi and told him that he had not received any engineering drawings.
Mr Freeman's evidence was that Mr Adams telephoned him and introduced him to Mr P Lombardi. Mr P Lombardi told Mr Freeman that the trunnions had failed on Roadwest's side tipping trailers. Mr Freeman told Mr P Lombardi that Roadwest had a racking problem, meaning that one side of the tipper was lifting higher than the other, causing stress on the opposite cylinder and the trunnions to break. He said to Mr Freeman that those cylinders should not be used in that application unless something was done to equalise the load or make the body more rigid. He suggested as an alternative using a different type of cylinder that would have an axis in all directions. Mr Freeman had no further conversation with Mr Adams in that telephone call. Mr Freeman did not recall receiving Mr Lombardi's letter of 3 September 2001.

Roadwest's use of other cylinders

In or about June 2000, Roadwest ceased using ROC cylinders in the manufacture of side tipping trailers. It has manufactured in excess of 200 trailers since then. Initially it used cylinders purchased from Glenrob Hydraulics, a South Australian company. That company went into liquidation and since then Roadwest has purchased cylinders from Engineer Products Group Pty Ltd. Its trailers have not failed since it has used other cylinders manufactured by other companies.

Howard Porter's experience with ROC cylinders in side tipping trailers

Howard Porter has carried on business building commercial vehicles, including trailers for many years. Hydraulic Sales was a supplier of hydraulic cylinders to Howard Porter.
On 19 September 2001 Mr Colin Stewart, the managing director of Howard Porter, sent a memorandum to Hydraulic Sales for the attention of Mr Adams by facsimile. The memorandum concerned the failure of ROC DA6 hoists used in side tipping trailers manufactured by Howard Porter. Mr Stewart sent with that memorandum a copy of a report by Mr Dante Travaglini, an engineer. In that report, Mr Travaglini wrote that the trunnion design was not sufficiently robust and that a redesign of the trunnion assembly should include a heavier trunnion wall thickness, a larger diameter pivot and a larger radius at the transition. Mr Stewart informed Mr Adams that Mr Travaglini's report concerned two hoists, one out of a trailer working at Dampier Salt and the other was one of eight fitted to four trailers working at Kalgoorlie. Mr Stewart asked Mr Adams to inform him what he proposed to do "to correct the faulty hoists".
On 20 September 2001, Mr Adams forwarded a copy of Mr Stewart's memorandum and Mr Travaglini's report to Mr Freeman by facsimile. In his covering facsimile Mr Adams wrote:
"Colin Stewart wants answers to his questions and prompt action is required.
It seems that the trunnion area is a problem as this is where Roadwest also have had problems and you have a letter from them.
I suggest a redesign with male clevis both ends and spherical bushings to take out any body twist which is obviously why they crack at the trunnion.
John we will not sell any more of the standard mount for side tippers where 2 cylinders are used as we will only open up more possible claims.
Please act on this and if you want to ring Colin Stewart direct feel free."
Hydraulic Sales did not provide discovery of Mr Adams' facsimile to Roadwest until the evening of the second day of the trial.
Mr Adams' evidence as to the reason for the recommendation contained in his facsimile of 20 September 2001 was that he knew that Roadwest was successfully using cylinders with clevis mountings at both ends and he thought he could regain some market share if ROC cylinders had similar mountings at both ends.
In October 2001, in response to Mr Adams' facsimile to Mr Freeman of 20 September 2001, ROC Hydraulics sent to Mr Adams a drawing for the ROC DA6 cylinder which adopted Mr Adams' of a clevis at both ends and spherical bushings.
On 18 October 2001, Mr Stewart sent a facsimile to Mr Adams. In that facsimile, Mr Stewart informed Mr Adams that he had spoken to Mr Freeman and Mr Stewart confirmed that ROC Hydraulics was providing four cylinders with modified base mounts to Howard Porter. Two of those cylinders were for use in a new trailer manufactured for Dampier Salt. The other two cylinders were being provided for a programme of cylinder exchanges and modifications of existing cylinders in one trailer manufactured for Dampier Salt and four trailers at Kalgoorlie. Mr Stewart requested that Hydraulic Sales provide credit for all cylinders purchased that related to the matter.

ROC Hydraulic cylinders in other side tipping trailers manufactured by Howard Porter

Bergmeier Earthmoving carries on an earthmoving business in Coolgardie. It uses eight side tipping trailers. Four of those side tipping trailers were manufactured by Howard Porter. Two were acquired in 1997 and two in 1998.
Bergmeier Earthmoving uses those trailers in heavy earthmoving over mine site roads and highways. Those trailers are fitted with ROC DA6 cylinders. Some of the hoists on those trailers have required repair or replacement as a result of wear and tear consistent with the heavy use of the trailers. None have failed in the way that hoists in trailers manufactured by Roadwest have failed.

Conclusions as to provision of drawings to Hydraulic Sales and what occurred at meeting of 3 July 2001

I prefer Mr Adams' evidence as to what occurred at the meeting of 3 July 2001 to the evidence of Mr P Lombardi, Mr Subramaniam and Mr Yates. Because the ROC DA6 cylinder is 43.5 inches long it is not long enough for use in end tipping trailers. I think it implausible that Mr Freeman would say to Mr P Lombardi that the cylinders were not suitable for side tipping trailers, as Mr P Lombardi, Mr Subramaniam and Mr Yates gave evidence that Mr P Lombardi said to Mr Adams that Mr Freeman had told him.
The evidence of Mr P Lombardi was that at the meeting he told Mr Adams that after Mr Subramaniam had sent to Mr Adams the initial drawings of the side tipping trailer Mr Adams had told Mr Subramaniam that the ROC cylinders were OK to use in the trailer. Mr Subramaniam gave evidence that at the meeting Mr Adams said that if ROC Hydraulics had not said the cylinders were OK to use, he would not have told Mr Subramaniam to go ahead with using them.
In its statement of claim, Roadwest pleaded in paragraph 5 that in or around mid‑September 1999 Mr Adams said to Mr Subramaniam in a telephone conversation that ROC DA6 cylinders were suitable for use in the side tipping trailers that Roadwest was using. If Mr Adams made such a statement it would be an important matter. The pleading reflected Mr P Lombardi's evidence as to what he said to Mr Adams at the meeting. Clearly Mr Subramaniam has told Mr P Lombardi that is what Mr Adams told him. Mr Subramaniam did not give evidence that any such representation was made and the pleading was amended at the end of the trial, so that it referred to Mr Adams's statement at Roadwest's premises after the construction of the trailers had commenced that they were looking good.
It is possible that Mr Adams did make the statement to Mr Subramaniam in or around September 2001 and that when giving his evidence Mr Subramaniam forgot about the statement, or simply omitted to give evidence about the statement. The other possibility is that Mr Adams made no such statement but that Mr Subramaniam has told Mr P Lombardi that he did so. I find it more likely that Mr Adams made no such statement.
I found Mr Subramaniam's evidence as to why he sent to Hydraulic Sales on three occasions a preliminary drawing without any measurements as unlikely. I cannot see that such a drawing would be of any relevance to Hydraulic Sales where Roadwest had requested a cylinder by its part number. Both Mr Tankard and Mr Adams denied receiving those drawings and I prefer their evidence.
As I have already noted I think it implausible that Mr Freeman would say to Mr P Lombardi that the cylinders were not suitable for side tipping trailers. Mr Freeman's evidence that he did not speak at length to Mr Adams tends to support the evidence of Mr Adams. Mr Freeman, as supplier of the parts, is not independent of this dispute, but his evidence is one factor that I take into account in arriving at my conclusion.
I have noted the late discovery by Mr Adams of his facsimile to ROC Hydraulics dated 20 September 2001. That document should have been discovered much earlier than it was and it is Mr Adams' fault that the discovery was so late. However, it is my view that Mr Adams was an honest witness and the late discovery was not evidence of dishonest behaviour. I accept his evidence that his recommendations in that facsimile were made to try to win back market share.
I also note the contents of Mr P Lombardi's letter to ROC Hydraulics of 3 September 2001 and the fact that Mr P Lombardi received no response to it other than, on Mr Adams' evidence, a denial that he had received the drawings. That letter was written two months after the meeting. I consider it a reconstruction of events rather than written on the basis of a recollection of what occurred at the meeting. As I have noted earlier, I think it unlikely that Mr Freeman would say to Mr P Lombardi that a 43.5 inch cylinder should not be used in a side tipping trailer as Mr P Lombardi wrote in his letter that Mr Freeman said repeatedly.
Mr Adams' statement to Mr Yates that ROC Hydraulics should sort out the problem was a statement of a desire for a commercial resolution to a problem. It was not a statement attributing or accepting responsibility for the problems that had arisen.
I conclude that Mr Subramaniam did not send drawings of the trailer to Hydraulic Sales in September 2001. At the meeting of 3 July 2001, Mr Adams did not speak to Mr Freeman other than to introduce Mr P Lombardi. After speaking to Mr Freeman, Mr P Lombardi said to Mr Adams that Hydraulic Sales was either with Roadwest or against it, but Mr Adams did not say he did not understand, nor that ROC Hydraulics had said that the cylinders were OK to use.

Expert evidence

Roadwest called expert evidence from Mr Jurien de Vos, an engineer. Mr de Vos has a first class honours degree in engineering, which he obtained in 1990. He is a member of the Institution of Engineers Australia, of the Institute of Materials Engineering Australia and of the Chartered Institute of Transport. He is the managing director of a company that provides design and drafting services in the road transport industry. Since January 1990, he has worked in the field of mechanical engineering. He worked as engineering manager with Howard Porter from July 1998 to August 2001.
On 12 November 2004 at Roadwest's premises, Mr de Vos inspected an ROC DA6 cylinder in a side tipping trailer manufactured by Roadwest. The front ROC DA6 cylinder of that trailer had been replaced due to failure. The owner wished to have the rear cylinder replaced. There was no evidence of failure in that rear cylinder. The trailer chassis at the rear was also sound.
In Mr de Vos' opinion the design of the trailer he inspected resulted in the trailer being torsionally flexible. When an uneven force is applied along the axis of the body it offers little resistance and will twist. This can occur when the trailer is unevenly loaded or travels over undulating ground. When the trailer twists, the corners where the cylinders are mounted displace longitudinally along the axis of the trailer. It is Mr de Vos' opinion that this type of behaviour is part of the normal operation of side tipping trailers and a cylinder for side tipping operations should be designed to accommodate this longitudinal movement. Torsional flexibility cannot be prevented in a side tipping trailer because one side of the trailer opens when it is tipping.
In Mr de Vos' opinion a ROC DA6 cylinder does not allow longitudinal movement and so it cannot accommodate that movement in a torsionally flexible side tipping trailer. The bolted feet of the cylinder limit the rotation of the cylinder about one axis only. The longitudinal movement will result in a loading to the trunnion that is above the normal load caused by the cylinder extending to tip the trailer. This will cause overloading of the trunnion feet and is likely to result in them failing.
To accommodate the longitudinal movement, it would be necessary for the cylinder to have a single point of support at the base of the cylinder. If there were a spherical bearing and a clevis at the base of the cylinder where the cylinder's feet are, the cylinder would be able to move in any direction.
Roadwest provided to Mr de Vos for inspection a complete hoist and components from a hoist that had failed. Those components had been metallurgically analysed by AMEC. The results of AMEC's analysis are contained in a material identification report dated 11 March 2004. That report was tendered into evidence as an annexure to a report prepared by Mr de Vos dated 25 January 2005 without objection.
One of the trunnions on the failed hoist had broken from the collar. Visual inspection of that trunnion showed cracking at the top and bottom. In Mr de Vos' opinion, the cracking at the top indicated that the trunnion had experienced a load in the opposite direction to the normal load. When the cylinder is operating to lift the trailer, it thrusts downward which causes a load at the bottom of the trunnion. Because the trunnion cracked at the top, Mr de Vos concluded that there was a force acting in the opposite direction which caused a load at the top. In his opinion, this confirms that there had been deflections in the trailer body due to twisting.
Mr de Vos analysed the working stresses in the collar by finite element analysis using Strand7 software. The finite element method has been used in engineering and mathematical research for around 50 years and is the most widely used method for structural analysis. Strand7 is a general purpose engineering analysis software. It has been available for approximately five years and is very widely used in engineering consultancies around the world.

To carry out the finite element analysis, Mr de Vos measured the failed cylinder he inspected. The fillet radius at the base of the trunnion, where the barrel of the trunnion joins the flat surface of the trunnion collar, was 2 millimetres.
The maximum rating of the cylinder in the ROC drawing of the cylinder was 2,500 psi. That would have created a total thrust at the trunnion of 314 kN. During normal operations with a legal trailer load, Mr de Vos calculated that the maximum thrust on a cylinder when operating would be 186 kN. As a cylinder has two trunnions the load on each trunnion would be 93 kN.
Mr de Vos considered the applied load in two scenarios: a uniformly distributed load of 93 kN and as a concentrated load of 93 kN near the base of the trunnion. Mr de Vos considers these scenarios to be the ends of the range of loading that a trunnion would experience.
Using Strand7 software, Mr de Vos concluded where there was a uniformly distributed load of 93 kN, the maximum principal stress on a trunnion would be 850 MPa. That stress would occur at the surface of the base of the trunnion and would be localised due to the stress concentration caused by the small fillet radius. If the stresses were analysed 2 millimetres below the surface they reduce to 330 MPa. The further a point is away from the surface of the trunnion the lower the stress at that point. Mr de Vos' report dated 25 January 2005 included a diagram showing the graphical representation of that stress. That diagram included an arrow into the trunnion which commenced at the point of maximum stress. The arrow was labelled: "Path of Crack growth". His evidence in chief as to cracking was:
"You refer to 'crack growth'. Are you there representing with this uniformly distributed load that there would be cracking?--- Because the stress is so high - it's a localised stress of 850 megapascals - that would result in local yielding, which is typical of rapid fatigue, and the way that the stress is distributed there, the arrow I've shown is a projected way that the crack would go.
So if we had a uniformly distributed load, as you're postulating in this exercise, and if that uniformly distributed load was the subject of various tipping operations over a period of time, what's likely to happen? ---There would be progressive yielding, localised yielding, which would over a period of time result in failure of that trunnion." (T274-275)
Where there was a concentrated load of 93 kN near the base of the trunnion, Mr de Vos concluded that the maximum principal stress on a trunnion would be 500 MPa. That stress would also occur at the surface of the base of the trunnion. That stress also exceeds the yield stress of the material and in Mr de Vos' opinion over a number of applications that would result in the failure of the trunnion collar.
To check on the results of the finite element analysis, Mr de Vos used manual calculations as an alternative method of analysis. For this exercise Mr de Vos assumed a uniformly distributed load and a distance of 25 millimetres from the base of the trunnion to where the force acted. That distance is approximately half the length of the trunnion. Mr de Vos calculated an uncorrected bending stress of 183 Mpa and a shear stress of 46 Mpa.
AS 1403-2004 is an Australian Standard that relates to the design of shafts. That standard gives a combined size and stress concentration factor of 2.3. Using that Standard, Mr de Vos calculated a corrected stress in the fillet region of 446 Mpa. Although this stress is significantly lower than that determined by finite element analysis, in Mr de Vos' opinion it still demonstrated that the stresses in the region are high.
AMEC's analysis, contained in its report dated 11 March 2004, showed that the material was AS3678-250 or 350. These grades of steel have yield strengths of 250 MPa and 350 MPa respectively and an ultimate strength of 410 MPa and 450 MPa. The stresses that Mr de Vos calculated exceeded these stresses and there would be progressive plastic yielding of the material and eventual failure after a number of cycles. In Mr de Vos' opinion, the reasons for the high stresses in the fillet region are:
"1.The fillet radius of 2 mm. A larger fillet radius would result in a reduced stress concentration, and so reduced stresses.
2.The diameter of the trunnion. Increasing the trunnion diameter would result in reduced bending stresses.
3.The wall thickness of 10 millimetres in the trunnion collar at the base of the trunnion. Increased wall thickness would reduce the stresses in the collar."
ROC Hydraulics' engineering drawing of the ROC DA6 cylinder has a fillet radius of 4 millimetres. In Mr de Vos' opinion, the cylinder he saw had not been manufactured with a fillet radius of that dimension. The radius had not been reduced by wear because the wear on the trunnion stopped approximately 2 millimetres short of the fillet radius, so the fillet radius did not exhibit any wear.
Mr de Vos' finite element analysis reviewed the cylinder thrust only. It made no allowance for side loading due to body twisting. In view of the presence of cracking at the top as well as the bottom of the trunnion, it is Mr de Vos' opinion that the actual stresses in the trunnion would be twice the stresses determined by finite element analysis, ie in excess of 1,500 MPa for the uniformly distributed load and 1,000 MPa for the concentrated load.
In Mr de Vos' opinion, the ROC DA6 cylinder is unsuitable for use in a side tipping trailer. The base design of the hoist cylinder is unsatisfactory in that the stress in the fillet area of the trunnion exceeds the yield strength of the material. Further the trunnion design does not allow for free movement at the bottom of the hoist, which is necessary to accommodate the displacement as a result of the twisting in the body and chassis of a side tipping trailer. The use of these cylinders in a side tipping trailer would result in the premature failure of the trunnion feet due to overstressing. Damage could also occur to the trailers due to the loading on the cylinders caused by the twisting of the bodies.
Hydraulic Sales called Mr Martin Simms as a witness. Mr Simms is a chartered consulting engineer. He holds a bachelor of applied science in mechanical engineering which he obtained in 1975. He has a graduate diploma in computer studies, certificates of structural drafting, mechanical drafting and trade studies in mechanical fitting. He is a Fellow of the Institution of Engineers Australia, a registered engineer (mechanical) on the National Professional Engineers Register and a Foundation Member of the Forensic Engineering Society. He has 16 ½ years' experience in private practice as an independent Consulting Engineer and 12 years' experience as the Engineer in Charge of the Police Department Licensing Division.
In Mr Simms' opinion, the finite element analysis used by Mr de Vos is not a sound method of analysis of failure, because it does not identify why the ROC DA6 cylinders failed. In his opinion, a trunnion stressed to 850 MPa would fail immediately because the stresses would be high enough to create a plastic hinge. A plastic hinge would form when all of the material from the surface of the trunnion down to the centre has reached yield stress and begins to bend without restraint. The fact that trunnions have lasted for some time leads Mr Simms to conclude that Mr de Vos' finite element analysis has produced incorrect results.
Mr Simms also carried out finite element analysis. Using a fillet radius of 4 millimetres, as shown on the ROC Hydraulics' engineering drawing, he obtained maximum stresses in the range of 273 MPa to 347 MPa. Using a fillet radius of 2 millimetres, he obtained a maximum stress of 433 MPa. As Mr Simms noted, this is close to the maximum stress of 446 Mpa that Mr de Vos obtained using manual calculations.
Mr Simms also carried out manual calculations, using formulae in a recognised reference on stress analysis. He calculated stresses in the range of 312 MPa to 388 MPa for a 4 millimetres fillet radius.
Mr Simms did not agree with Mr de Vos that the failed cylinder did not demonstrate wearing of the fillet radius. He observed some very deep scoring which indicated to him that the radius had been worn away.
I do not accept Mr de Vos' analysis. The steel of which the trunnions were made had an ultimate strength of at most 450 MPa. Mr de Vos' calculations using finite element analysis with a 2 millimetres fillet radius produced stresses at the surface far in excess of that strength. In that analysis, Mr de Vos made no allowance for torsional flexibility which, in his opinion, would produce far greater stresses. The trunnions did not immediately fail. At least one ROC DA6 cylinder used by Roadwest in the manufacture of side tipping trailers had not failed at the time of Mr de Vos' inspection on 12 November 2004. ROC DA6 cylinders are functioning without failing on side tipping trailers used by Bergmeier Earthmoving.
I do not accept that the fact that the stress would only occur at the surface explains why the trunnions did not immediately fail if Mr de Vos' calculations are correct. Where a material has a stress placed upon it that is greater that its ultimate strength, it will fail. Many trunnions have not failed.
Nor do I accept Mr de Vos' conclusion that the failed trunnion he inspected which had a fillet radius of 2 millimetres had been manufactured with that fillet radius. The presence of the deep scoring observed by Mr Simms indicates that there has been wearing of the radius.

The pleaded representation

After amendment of its statement of claim at trial, Roadwest claimed that Mr Adams' statement to Mr Subramaniam at Roadwest's premises that the side tipping trailers being built looked good was a representation that the ROC DA6 cylinders were suitable for use in the trailers. Roadwest claims that the representation was false and constituted a term in the contracts between Roadwest and Hydraulic Sales. It claims damages for breach of contract, negligent misstatement and misleading and deceptive conduct based on that representation.
The statement was made after the first contract was entered into and so could not be a term of that contract. Whether a statement constitutes a contractual term is to be determined objectively: Hospital Products Ltd v United Surgical Corporation (1984) 156 CLR 41.
In my view the statement did not constitute the representation alleged. Nor was it a contractual term. It was no more than a general positive statement about the appearance of the trailers. It was not a misstatement and was not misleading or deceptive.

Express term of fitness for purpose

Roadwest claims that there was an express term of the contracts between Roadwest and Hydraulic Sales that the ROC DA6 cylinders were suitable for use in the trailers being built by Roadwest. This claim is based on the allegations that Mr Subramaniam forwarded drawings to Hydraulic Sales and on Mr Adams statement that the side tipping trailers being built looked good. I have concluded that Mr Subramaniam did not send those drawings to Hydraulic Sales. Even if he did, it is my view that the statement made by Mr Adams did not constitute the term alleged. The allegation of the express term is not made out.

Implied term of fitness for purpose

Roadwest also claims that there was an implied term of the contracts that the ROC DA6 cylinders were suitable for use in the trailers being built by Roadwest. That term is alleged to be implied by virtue of the pre‑contractual negotiations including the alleged representation by Mr Adams, by s 14 of the Sale of Goods Act 1895 and by operation of law.
As I have concluded that the drawings were not provided to Hydraulic Sales by Mr Subramaniam and that Mr Adams' statement was only a general statement as to appearance, the pre-contractual negotiations do not establish the implied term alleged.
S 14(1) of the Sale of Goods Act 1895 implies a term of reasonable fitness for the purpose supplied where the buyer makes known to the seller the purpose for which the goods are required so as to show that the buyer relies on the seller's skill or judgment and the goods are of a description which it is in the course of the seller's business to supply. The subsection contains a proviso that the term is not implied in the case of a contract for the sale of a specified article under its patent or other trade name. The mere fact that a contract includes the trade name of the goods sold will not prevent the term being implied if the buyer makes known to the seller the purpose for which the goods are purchased, shows that the buyer is relying on the seller's skill or judgment and the goods are of a description in the course of the seller's business to supply: Baldry v Marshall [1925] 1 KB 260; Grant v Australian Knitting Mills Ltd & Anor (1935) 54 CLR 49.
The ROC DA6 cylinders were in the course of the seller's business to supply. However, it is my view that the term of fitness for purpose is not implied into the contracts by the Sale of Goods Act. Roadwest purchased the cylinders because they were the cylinders specified by Mr Dyke. It did not show that it was not relying on Hydraulic Sales' skill or judgement and nor was it so relying. It was relying on the fact that Mr Dyke had recommended and specified the cylinders. The orders dated 6 April, 3 October and 13 October 2000 did not specify the cylinders that Roadwest was ordering, but it is clear from their context and the chronology of orders that the cylinders being ordered were the same cylinders that had previously been ordered.
There is no other basis upon which the term is to be implied by law into the contracts. To be implied the term must be necessary for the reasonable or effective operation of the contracts: Byrne v Australian Airlines Ltd (1995) 185 CLR 410. As Roadwest was purchasing a part specified by Mr Dyke and was not relying upon Hydraulic Sales' skill or judgment the term is not so necessary. It does not arise from custom or usage as there is no evidence that it is so well known that the parties can reasonably be assumed to have imported it into the contracts: Con‑Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Australia) Ltd (1986) 160 CLR 226.

Silence

Roadwest claims that Hydraulic Sales' silence constitutes a representation that ROC DA6 cylinders were fit for Roadwest's purposes and constituted misleading or deceptive conduct. I have concluded that drawings were not sent by Mr Subramaniam to Hydraulic Sales and that Mr Adams' statement was a general positive statement as to appearance only. On these facts silence does not constitute a representation, nor misleading or deceptive conduct.
I conclude that Roadwest has not made out its claims in damages for breach of contract, negligent misstatement or misleading or deceptive conduct.

Provisional assessment of damages

It is appropriate for me to express my views on damages, in case my conclusions as to the plaintiff's claim are incorrect. Roadwest's claim for damages is for $71,710.98.
The claim was supported by detailed evidence of Mr P Lombardi based on Roadwest's records. Counsel for Hydraulic Sales did not make any submissions on the quantum of the claim. I am satisfied that failures of the trunnions did occur and that the steps taken by Roadwest to remedy the failures were reasonable. If I had found that Roadwest had made out its claim, I would have awarded damages in the sum claimed.