Ruaro v Ferrari

Case [2007] FCA 2022

FEDERAL COURT OF AUSTRALIA

Ruaro v Ferrari [2007] FCA 2022

TRADE PRACTICES – mooring agreement – where right granted to use marina facilities to moor vessel – vessel destroyed during storm – whether breach of warranties implied by s 74 of the Trade Practices Act 1974 (Cth) – whether breach of duties of care – whether misleading and deceptive conduct under s 52 of the Trade Practices Act – whether statements made constituted the alleged representations.

Trade Practices Act 1974 (Cth) ss 4, 52, 68, 74(1), 74(2) and 82

MARK RUARO AND ANOR v CATHERINE FERRARI AND ANOR

NSD936 OF 2005

EMMETT J
19 DECEMBER 2007
SYDNEY


IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

NSD936 OF 2005

BETWEEN:

MARK RUARO
First Plaintiff

SECILIA RUARO
Second Plaintiff

AND:

CATHERINE FERRARI
First Defendant

HOLCOMM MARINE PTY LIMITED t/as HOLMEPORT MARINAS ACN 062 320 870
Second Defendant

JUDGE:

EMMETT J

DATE OF ORDER:

19 DECEMBER 2007

WHERE MADE:

SYDNEY

THE COURT:

1.Orders that the proceeding be dismissed.

2.Orders that the plaintiffs pay the second defendant’s costs of the proceeding.

3.Directs that orders 1 and 2 not be entered before 11 February 2008.

4.Directs the parties to make any further submissions regarding costs, no later than 1 February 2008.

5.Directs that the matter be listed for directions on 8 February 2008.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.


IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

NSD936 OF 2005

BETWEEN:

MARK RUARO
First Plaintiff

SECILIA RUARO
Second Plaintiff

AND:

CATHERINE FERRARI
First Defendant

HOLCOMM MARINE PTY LIMITED t/as HOLMEPORT MARINAS ACN 062 320 870
Second Defendant

JUDGE:

EMMETT J

DATE:

19 DECEMBER 2007

PLACE:

SYDNEY

REASONS FOR JUDGMENT

INTRODUCTION
THE MAKING OF THE MOORING AGREEMENT
THE TERMS OF THE MOORING AGREEMENT
THE PAVANA MOORING
THE WEATHER CONDITIONS ON 24 AUGUST 2003
RELEVANT PROVISIONS OF THE TRADE PRACTICES ACT
THE ISSUES
CONTRAVENTION OF SECTION 52 OF THE TRADE PRACTICES ACT
SECTION 74(1) OF THE TRADE PRACTICES ACT
SECTION 74(2) OF THE TRADE PRACTICES ACT
DUTY OF CARE
OPERATION OF SECTION 68 OF THE TRADE PRACTICES ACT
ADEQUACY OF MOORING 60 TO RESTRAIN PAVANA
VALUE OF SEAQUEST
CONCLUSION

INTRODUCTION

  1. On Sunday, 24 August 2003, the plaintiffs, Mr Mark Ruaro and Mrs Secilia Ruaro, were the owners of a twin screw, inboard powered, raised bridge, wood, motor yacht approximately 56 feet in length built in 1938 by Holmes Brothers in Sydney, known as “Seaquest”.  Seaquest was bought by Mr and Mrs Ruaro in 1993 and, thereafter, they carried out major restoration works on Seaquest.  Seaquest was their pride and joy. 

  2. On 24 August 2003, Seaquest was attached to a swing mooring in Rose Bay, which is part of Sydney Harbour, pursuant to a licence granted by the defendant, Holcomm Marine Pty Limited (Holmeport).  In severe weather conditions in the afternoon of that day, another vessel, Pavana, which was attached to a swing mooring located more than 100 m…

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Ruaro v Ferrari [2007] FCA 2022
Case
[2007] FCA 2022
Decision Date

CaseChat Overview and Summary

In the case of Ruaro v Ferrari, the plaintiffs, Mr and Mrs Ruaro, sought damages against Holmeport for the loss of their yacht, Seaquest, which was moored at Holmeport's marina. The Ruaros alleged that Holmeport was negligent in failing to provide a secure mooring for Seaquest, which led to the yacht drifting and being damaged. Holmeport denied liability, arguing that a condition in the Mooring Agreement expressly excluded their liability for any loss or damage to Seaquest. The matter was heard in the Supreme Court of New South Wales.

The court was required to determine whether Holmeport owed a duty of care to the Ruaros to ensure a secure mooring for Seaquest and, if so, whether that duty was breached. The court also had to consider the enforceability of the exclusion clause in the Mooring Agreement and whether it could be set aside under section 68 of the Trade Practices Act. Additionally, the court needed to assess the adequacy of the mooring provided by Holmeport and whether it was sufficient to hold Seaquest securely.

The court found that the exclusion clause in the Mooring Agreement was valid and enforceable, and it operated to exclude Holmeport's liability for any loss or damage to Seaquest. The court held that the Ruaros had agreed by contract that Holmeport would not be liable for any such loss or damage. Furthermore, the court concluded that section 68 of the Trade Practices Act did not render the exclusion clause void, as it was not intended to invalidate valid contractual arrangements but only to ensure that such arrangements did not exclude the benefits conferred by the Act. The court also determined that there was no evidence to support the Ruaros' claim that Holmeport was negligent in providing an inadequate mooring for Seaquest. The court found that Holmeport had taken reasonable measures to ensure that the mooring was adequate, and there was no breach of any duty or warranty.

The court dismissed the Ruaros' claim, ordering them to pay Holmeport's costs of the proceeding. The court found in favour of Holmeport and against the Ruaros on all counts, concluding that there was no liability on the part of Holmeport for the loss of Seaquest.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

EMMETT J
Doing the best that I can on the basis of the evidence, I would be disposed to conclude, on the balance of probabilities, that Seaquest had a market value in August 2003 in the vicinity of $US320,000 less the sum of $A116,000, being the cost of transportation to the East Coast of the United States. If Mr and Mrs Ruaro were entitled to damages, that would be the measure of their damages. CONCLUSION However, in the light of the conclusions outlined above, there must be judgment for Holmeport. The proceeding must be dismissed. Mr and Mrs Ruaro must pay Holmeport’s costs of the proceeding, subject to any question of the costs of the cross-claim.

Ratio Decidendi

Legal Principle Established

Established by: EMMETT J

In a sense, Condition 4 operates fortuitously in favour of Holmeport in the present case. Clearly enough, Condition 4 was intended to operate in circumstances where, by reason of some deficiency in the mooring assigned to Seaquest, Seaquest became adrift and suffered damage. Nevertheless, Condition 4 is applicable in its terms. As a matter of contract, Mr and Mrs Ruaro agreed that Holmeport would not be liable for any loss or damage suffered or incurred by or in respect of Seaquest, however caused. As a matter of contract, they have agreed not to hold Holmeport responsible for any loss or damage by or in respect of Seaquest. I do not consider that Holmeport owed the secure mooring duty to Mr and Mrs Ruaro as alleged. Accordingly, subject to the operation of s 68 of the Trade Practices Act, I do not consider that Holmeport has any liability in tort for breach of the alleged secure mooring duty. OPERATION OF SECTION 68 OF THE TRADE PRACTICES ACT Mr and Mrs Ruaro contended that the conditions of the Mooring Agreement to which I have referred above purport to exclude, restrict or modify or have the effect of excluding, restricting or modifying the application of s 74 of the Trade Practices Act and any liability of Holmeport for breach of the warranties implied by s 74. They say that, therefore, those conditions are void by the operation of s 68 of the Trade Practices Act. Accordingly, they say, the conditions can have no effect in relation to the question of the existence of a duty of care, the breach of which would give rise to a liability in tort under the general law. I do not consider that s 68 of the Trade Practices Act operates to render Condition 4 void. I consider that the effect of s 68 is to render a term of a contract void only to the extent that it modifies the operation of, relevantly, s 74. Section 68 is not designed to strike down valid contractual arrangements except in so far as the arrangements are designed to exclude the benefits intended to be conferred by provisions such as s 74. ADEQUACY OF MOORING 60 TO RESTRAIN PAVANA In the light of the conclusions that I have reached, it is not strictly necessary to deal with the question of the adequacy of mooring number 60 as a mooring for Pavana. Nevertheless, that question was a substantial issue in the proceeding and it is appropriate that I express the conclusions that I would reach as to whether there was a breach of the secure mooring duty or a breach of a warranty implied by s 74(2) of the Trade Practices Act, if I had concluded that Holmeport owed the secure mooring duty or that a warranty was implied by s 74(2). The question, as I apprehend the contentions of the parties, is whether Holmeport took reasonable measures to ensure that Pavana’s mooring was adequate to hold Pavana in conditions that could reasonably be expected in Rose Bay. Mr and Mrs Ruaro alleged that Holmeport was in breach of the secure mooring duty and of the s 74(2) warranty in so far as Holmeport:·failed to check the condition and adequacy of mooring number 60 for Pavana;·failed to supply an adequate mooring block for Pavana to ensure that the mooring would not be dragged by Pavana;·failed to ensure that mooring number 60 was adequate for the purpose of mooring Pavana so that it would not drag;·failed to ensure that Pavana was allocated to a mooring that was appropriate for its use;·caused Pavana to be moored to mooring number 60 when Holmeport knew or ought to have known that mooring number 60 would not be adequate to hold Pavana.