Sands v Vanderkyl
[2015] QDC 125
•25 May 2015
DISTRICT COURT OF QUEENSLAND
CITATION:
Sands v Vanderkyl & Anor [2015] QDC 125
PARTIES:
GRAHAM ARTHUR SANDS (by his litigation guardian Brian Hildebrandt)
(Plaintiff)and
JAMES MICHAEL VANDERKYL
(First Defendant)and
RAYE JEAN VANDERKYL
(Second Defendant)FILE NO/S:
D10/2013 (Bowen)
DIVISION:
Civil
PROCEEDING:
Trial
ORIGINATING COURT:
District Court at Bowen
DELIVERED ON:
25 May 2015
DELIVERED AT:
Townsville
HEARING DATES:
24, 25, 26 and 27 February 2014, 20, 21 and 22 May 2014; 02 July 2014.
JUDGE:
Durward SC DCJ
ORDERS:
1 Declaration that the Agreement for Sale made on 21 July 2008 is voidable at the suit of the plaintiff on the grounds of lack of capacity and/or unconscionable conduct and is set aside.
2 Further and in the alternative the defendants were in breach of the terms of the Agreement for Sale made on 21 July 2008.
3 The plaintiff is entitled to be compensated for loss arising from the setting aside of the Agreement for Sale or the breach of the Agreement for Sale, by an award of damages.
4 Judgment for the plaintiff against the defendants in the sum of $38,500.00 plus interest.
5 That upon payment of the judgment sum including costs by the defendant’s to the plaintiff, the plaintiff give possession of the wreck of the vessel ‘Norsaga’ and the two masts to the defendants.
6 I will hear the parties as to the rate and period over which interest should be calculated.
7 I will hear the parties further as to costs.
CATCHWORDS:
CONTRACT OF SALE – PARTIES – INCAPACITY OF BUYER – ENFORCEABILITY – sale of sailing vessel – whether buyer subject to special disability by reason of acquired brain injury, epileptic state and anxiety depressive state – whether buyer lacked capacity to make contract – whether seller had actual or at least constructive knowledge of alleged incapacity.
CONTRACT OF SALE – MERCHANTABILITY AND FITNESS FOR PURPOSE – ENFORCEABILITY – large sailing boat – whether in fit and proper state of seaworthiness and repair – where boat showed signs of deterioration soon after sale – whether boat was in good working order and able to be sailed and lived on.
CONTRACT OF SALE – ENFORCEABILITY – BREACH OF CONTRACT – REMEDIES – whether contract void or voidable for breach – where grounds of alleged breach are special incapacity of buyer and/or merchantability and fitness for purpose.
CONTRACT OF SALE – VOID OR VOIDABLE – BREACH – REMEDIES – whether contract voidable for unconscionable conduct and/or undue influence and/or on principle of ‘non est factum’.
WITNESSES – TRIAL - EXPERTS – QUALIFICATION - WHETHER SUBJECT OF EXPERTISE – whether identification of and opinion about timber pests and activity an area of expertise – whether marine environment different from land environment – whether timber marine vessel may have been infested with carpenter ants and integrity of timber compromised - whether evidence of duration of existence of wood rot due to infestation.
PRACTICE & PROCEDURE – TRIAL - WITNESSES – NON-PRODUCTION – where each party did not produce a witness who may have given relevant evidence in respect to contentious issues – explanations given – whether non-production gives rise to inferences against interest of a party.
DAMAGES – BREACH OF CONTRACT – QUANTUM OF DAMAGES - PROOF – whether purchase price recoverable – how damages assessed.
DAMAGES – PLEADINGS - WASTED EXPENDITURE –– COURSE OF HEARING – where damages for wasted expenditure claimed but not pleaded – whether defendants knew they had to meet such claim – where evidence not challenged - whether claim valid on basis of acquiescence – where quantum difficult to assess - whether damages claimed recoverable - whether claim arises adventitiously – where claim refused.
DAMAGES – UNCONSCIONABLE CONDUCT – DELAY - where boat a wreck prior to date of hearing and value substantially diminished – whether parties can be returned to positions they were in at time of sale - how damages assessed.
DAMAGES – MITIGATION OF DAMAGES – REASONABLNESS - whether reasonable steps were taken by plaintiff to mitigate damage – where defendants should not be liable for all of the damage to or deterioration in the condition of the boat – where damages reduced in an exercise of discretion.
LEGISLATION:
Uniform Civil Procedure Rules 1999 rules 79, 149, 150 and 395.
CASES:
Gibbons v Wright (1954) 91 CLR 423; Hart v O’Connor [1985] AC 1000; Commercial Bank of Australia Ltd v Amadio (1983) 151 CLR 447; Commonwealth v Verwayen (1990) 170 CLR 394; ACCC v Berbatis Holdings Pty Ltd [2000] FCA 1376; Blomley v Ryan (1956) 99 CLR 362; National Westminster Bank plc v Morgan [1985] AC 686; Harley v McDonalds Australia Ltd (1999) FCA 144; Bridgewater & Ors v Leahy & Ors [1998] HCA 66; Lloyds Bank Ltd v Bundy [1975] 1 QB 326; Clark v Ryan (1960) 103 CLR 486; McCann v West Australian Ltd [2006] QCA 175; Jones v Dunkel (1959) 101 CLR 298; Commonwealth v Amman Aviation Pty Ltd (1991) 174 CLR 64; Banque Commerciale SAV, en liquidation v Akhil Holdings Ltd (1990) 169 CLR 279; Caltex Oil (Australia) Pty Ltd v The Dredge Willemstad (1976) 136 CLR 529; Johnson v Perez (1988) 166 CLR 351; Hungerfords v Waller (1989 171 CLR 125; Cade Pty Ltd v Thomson Simmons [1998] SASR 6912; Wenham v Ella (1972) 127 CLR 454; The Commonwealth v Amman Aviation Pty Ltd (1991) 174 CLR 64; Unity Insurance Brokers Pty Ltd v Rocco Pezzaro Pty Ltd (1999) 192 CLR 603; TC Industrial Plant Pty Ltd v Roberts Queensland Pty Ltd (1963) 180 CLR 130; AHR Constructions Pty Ltd v Maloney (1994) 1 Qd R 461.
COUNSEL:
GT Byrne of counsel for the Plaintiff
DW Honchin of counsel for the First and Second DefendantsSOLICITORS:
GT Byrne of counsel appeared for the plaintiff, by leave, without instructing solicitors
Allan Mallard Solicitor for the First and Second DefendantsThe proceeding
In July 2008 the plaintiff Graham Arthur Sands (“Mr Sands”) borrowed from the Queensland Country Credit Union (“QCCU”) the sum of $65,680.32. He bought a boat (“the Norsaga”) from James Michael Vanderkyl and Raye Jean Vanderkyl (“the defendants”) for the sum of $55,000.00. He expended some or all of the balance of the loan on repairs to his home at 123 Soldiers Road, Bowen, or on or in respect of the Norsaga.
Mr Sands applied for the loan so that he could make a “sea change” in his life: he intended to repair his house and sell it and make a new home on the water, living on the Norsaga.
It is alleged in the plaintiff’s case that Mr Sands made the contract of sale of the Norsaga whilst under a special disability, being primarily an impaired mental capacity.
It is alleged in the plaintiff’s case that the Norsaga was unseaworthy, beyond his means of repair, unfit for sale and that Mr Sands could not possibly have lived in it on the water.
History of this and the associated proceeding
QCCU brought a proceeding against Mr Sands to take possession of his house because he had not made any, or at least much by way of, loan repayments and because the loan was in arrears.
Mr Sands brought a proceeding against the defendants to recover damages for breach of contract and for Declarations in relation to the sale and purchase of the Norsaga.
Mr Sands was a party to both proceedings, by his Litigation Guardian Mr Brian Hildebrandt, who had been appointed as the Administrator for Mr Sands by the Queensland Civil and Administrative Tribunal (“QCAT”) on 29 July 2011 (exhibit V19) until his removal and the appointment of The Public Trustee of Queensland, by an Administration Order made by on 30 October 2012 (exhibit 20), whose office assumed responsibility as Administrator for Mr Sands for all financial matters, pursuant to the Guardianship and Administration Act 2000.
The two proceedings were heard together following an order made by his Honour Judge Baulch SC pursuant to rule 79 of the Uniform Civil Procedure Rules 1999 (“UCPR”), on 29 August 2013.
The hearing of the two proceedings commenced in the District Court at Bowen, on 24 February 2014. I directed that the evidence on the hearing of the two proceedings was to be evidence for both proceedings: r 395 UCPR and McCann v West Australian Ltd [2006] QCA 175, per Muir JA at [104].
The QCCU Claim against Mr Sands was resolved on the third day of the trial. The plaintiff filed a Notice of Discontinuance, with the consent of the Litigation Guardian Mr Hildebrandt, on 31 March 2014.
The subject proceeding
The hearing of Mr Sands’ claim against Mr & Mrs Vanderkyl continued for a further day and was then adjourned to a date to be fixed. The proceeding resumed on 20 May 2014 and concluded on 22 May 2014. Counsel made oral submissions in Brisbane on 23 July 2014.
Plaintiff’s claim
The plaintiff has claimed the sum of $55,000.00 damages for breach of contract; and sought Declarations that the contract is voidable, on each of the following grounds: lack of capacity or unsoundness of mind; unconscionable conduct; the principle of non est factum; and the exercise of undue influence over the plaintiff.
The pleadings
The plaintiff’s Claim – specifically the Statement of Claim – is quite discursive and contains evidence and some matters of particularisation beyond that permitted by rule 149 UCPR. The Defence responds to some of those matters and the Reply in turn arguably does so. However, the plaintiff was represented by counsel without an instructing solicitor and was in the matter in the first place potentially, depending on the outcome of the litigation, on a pro-bono basis. The defendants’ lawyers very fairly and reasonably, in the circumstances, prepared some joint material that might otherwise have been undertaken by lawyers for the plaintiff.
Hence no pleading points were taken when the hearing commenced or indeed, at earlier stages of the proceeding, the long history of which is recorded on file but does not need to be referred to here. There was in final submissions a point taken about the pleadings in respect of a head of damages said to have arisen on the evidence but in respect of which no leave to amend or amendment was made by the plaintiff. I will deal with that matter in the course of the judgment.
Insofar as is relevant, rule 150 UCPR has been complied with.
The parties were content, at least implicitly, to deal with the allegations in the pleadings in respect of those matters that the rules permit to be pleaded. To the extent that any party might be said to have been disadvantaged [although I do not think that is the case] it is more likely to have been the plaintiff than the defendants. The litigable issues were agreed and the focus in the hearing was on those issues.
The contract was partly written and partly oral. It comprised both a written “Agreement for Sale” and conversations said to have occurred in the weeks leading up to the date of the sale that occurred in a number of locations in Bowen. The “Agreement for Sale” includes three specific provisions in addition to the supply of the Norsaga. The document speaks for itself. The entirety of the written and oral terms constitute the ‘Agreement for Sale’ and that expression has that meaning where it is used in this judgment.
The Agreement for Sale made on or about 21 July 2008
The written terms of the Agreement for Sale are as follows:
“AGREEMENT BETWEEN GRAEME ARTHUR SANDS HEREAFTER KNOWN AS THE PURCHASER AND JAMES MICHAEL AND RAY JEAN VANDERKYL HEREAFTER KNOWN AS THE VENDORS.
The purchaser agrees to pay the sum of FIFTY FIVE THOUSAND DOLLARS $55,000 for the yacht NORSAGA.
THE VENDORS agree to pay the mooring fee in Bowen Boat Harbour which then will be current until 30 June 2009. THE PURCHASER agrees to reimburse the VENDORS for the amount of the mooring fee, $799.90.
THE VENDORS agree to provide the following:
· Reasonable training in the operation and maintenance of the said yacht.
· A manual of operation and maintenance.
· All items of equipment are listed separately.
SIGNED BY THE CONCERNED PARTIES ...”
The agreement was signed by Mr Sands and by Mr & Mrs Vanderkyl. It was witnessed by a Mr Radford. There was a separate handwritten list of other items of equipment included in the sale, prepared by Mr Vanderkyl. That list of course forms part of the written terms of the Agreement for Sale. The handwritten list has since been lost or disposed of in some way.
Mr Sands’ first given name is spelt incorrectly in the Agreement for Sale. In the Pleadings and in the QCAT documents (supra) the spelling is “Graham” In the Agreement for Sale the spelling is “Graeme”. This error was not referred to in evidence or in submissions, by counsel. Mr Sands either did not notice it or if he did, he said nothing about it in his evidence when he read the document aloud in cross-examination.
Oral terms
The material terms of the oral agreement were that:
· “The defendants would repair the remote steering on the yacht so that it was in good working order;
· The defendants would check out the debris on the deck that the plaintiff had noticed to make sure any defect was rectified;
· The defendants represented to the plaintiff that the debris on the deck was not a problem and there was nothing to be rectified; and
· ‘Norsaga’ was in good working order and that the plaintiff would have no difficulties sailing it or living on it.”
The Bill of Sale dated 28 July 2008
The Bill of Sale (document 20 in the Agreed Bundle of documents provided by the parties with respect to both trials) was attached to a covering latter addressed to Mr Sands at his residential address in Bowen. The Bill of sale records the transfer of 64 shares in the Norsaga from the defendants to Mr Sands (for the purposes of the Australian Shipping Registration Office) and is dated 28 July 2008. The defendants’ address is stated as ‘1A George Street, Bowen’, which was their residential property. The witness to the signatures of the defendants is Mr Radford (to whom I will refer later). Mr Sands’ name and address is recorded as the ‘Buyer’. His first name is correctly spelt as ‘Graham’ in this document, as it is in the covering letter. It seems to me that the Bill of Sale is not a document that Mr Sands would have seen before it was submitted by Mr Vanderkyl for the transfer of the shares.
Pleadings Table
The following Table details the specific allegations of importance (in light of the way the case was litigated in the course of the hearing) and in the context of my observations that the pleadings did not comply fully with the rules; and the Defence of the defendants and the Reply.
TABLE
Statement of Claim Defence Reply 7 (i) Repair of the remote steering; (ii) check and rectify the debris on the deck; (iii) representations that the debris was not a problem and there was nothing to be rectified; (iv) vessel in good working order and no difficulty in living on it.
8 The remote steering not fixed.
9 (i) Denied and alleged that the plaintiff’s brother was to carry out the repairs; (ii) plaintiff was present when an inspection was carried out; (iii) denied that any representation had been made to the plaintiff; (iv) Admitted. 2 (i) Denial that the plaintiff’s brother was to carry out the repairs; (ii) & (iii) Denied. No pest inspection took place and no pest inspector made representations to the plaintiff; (iv) Admission adopted. 9 The plaintiff raised the issue of debris in August 2008 and Mr Vanderkyl told him it was not a problem and nothing need to be done with it. 10 Denied on the ground that that no such conversation took place or representation was made. 10 Borer holes on the deck – requiring extensive work. 11 Denied. The debris was inspected by a pest inspector and identified debris as insect castings. 12 Special disability pleaded 12 Motor vehicle accident was admitted. Did not admit the nature and extent of the injuries suffered by the plaintiff. Denied impaired capacity; or alternatively, that defendants had any knowledge of it. Reply with respect to the alleged negotiation and drafting of conditions. 24 The decks were very spongy, a sign of rotten wood (No specific pleading) 26 Motor badly corroded and wiring a mess. Denied – motor refurbished in 2008 33 Norsaga not fit for sale 19 The vessel was regularly sailed in the years prior to and in 2008. 37 Large quantity of used engine oil in the bilge requiring baling and disposal. 23 Engine refurbished in 2008 and in good condition. 40 Starboard side of hull patched with a “bung” 24(d) Denied – hull in sound condition at the time of sale. 45 Boat leaked excessively and required regular pumping out Allegations not admitted 46-47 Norsaga taken out of harbour and subsequently returned Allegations not admitted 49 & 52 Norsaga sank in about 25 June 2012 after a bilge pump failure, but was subsequently re-floated. Allegations not admitted. 55(a) Areas of the Norsaga were painted without surface preparation and paint/gel coat simply peeled off Denied. 55(b) Putty put into holes to cover them. Putty soon came out again. 29 Denied. Norsaga sold as a used vessel in good condition. Denied. Norsaga leaked and could not maintain buoyancy without a working pump and failed to meet the definition of a ‘boat’ as it did not have the feature of “buoyancy by excluding water from the vessel”. 64 Faulty wiring. 33(e) Denied. Wiring at the time of sale was in good condition. 15(d) Plaintiff negotiated a draft of the terms and conditions of the written contract 6 Denied. Plaintiff simply agreed to pay and accepted the proposed agreement. 7 Engine and lighting. The engine did not work and became seized; and the lighting either did not work or failed.
The plaintiff had made a request for Further and Better Particulars. The Response of the defendants was:
· The defendants provided training and the documentation referred to in the agreement for sale.
· The pest inspector who carried out the inspection for the defendants was John McElhinney.
· The engine refurbishment occurred over a period unknown in 2008. The engine was removed by crane and taken to the first defendant’s property where the work was carried out by the first defendant. Bowen Engineering supplied parts and machined valves at the request of the first defendant.
· The parts cost was estimated to have been $900 - $1,000. Bowen Engineering was paid by cash.
· The voyages in the ten years prior to and in 2008 comprised twenty or more conducted in the Bowen Whitsunday waters. Consumables were paid for by cash and no documentary record was made or kept.
Preface
In 1986 Mr Sands was injured in a motor vehicle accident. He suffered head injuries, a skull fracture and encephalomalacia involving his left temporal lobe that caused an acquired brain injury.
Those injuries included a number of medical conditions, including complex partial seizures, post-traumatic epilepsy and a severe reactionary form of anxiety depressive state, the latter due to his chronic illness and living conditions.
The consequence of the acquired brain injury was that Mr Sands lacked the capacity to maintain his employment and was awarded a disability support pension.
After 1986, it is alleged that he had and he continues to have, impaired mental capacity to understand and make financial decisions or major life decisions.
Issues for determination
There are two issues:
A. Whether Mr Sands was under a special disability in dealing with the defendants in the sale and purchase of the Norsaga by reason of an acquired brain injury, epileptic state and anxiety-depressive state, attributable to injury caused in a motor vehicle accident in 1986, and whether he lacked the capacity to make the contract;
and
B. Whether the Norsaga was in a fit and proper state of seaworthiness and repair so as to be merchantable and fit to be sold.
Agreed facts
The parties agreed on the following facts:
1. The plaintiff and defendants entered into a contract for the sale of a yacht, “Norsaga”, to the plaintiff on 21 July 2008.
2. The contract for sale was comprised of a written document and oral terms with a consideration of $55,000.00.
3. The terms of the contract included that the seller would provide to the buyer:
(a) reasonable training in operation and maintenance of the yacht;
(b) a manual of operation and maintenance;
(c) items of equipment listed separately.
4. The plaintiff paid to the defendants the agreed consideration of $55,000.00.
5. The yacht Norsaga was taken possession of by the plaintiff.
6. The yacht Norsaga was slipped in dry dock at Bowen on 21 July 2008.
7. On about 25 June 2012 the yacht Norsaga sank and the hull was fully submerged.
I have written the judgment in two parts insofar as the two issues for determination are concerned: Part A: Special Disability; and Part B: Seaworthiness of the Norsaga.
PART A: SPECIAL DISABILITY
The agreed matters in issue on the allegation of special disability
The parties agreed that the matters in issue on the allegation of special disability were as follows:
1. Whether the plaintiff had capacity to enter into a contract for the purchase of the Norsaga for $55,000.00?
2. If the plaintiff lacked capacity for the transaction, whether the defendants knew or ought to have known he lacked the relevant capacity?
3. If the defendants knew or ought to have known that the plaintiff had a relevant incapacity, was the sale of the Norsaga to the plaintiff by the defendants thereby unconscionable?
4. Did the defendants exercise undue influence over the plaintiff in the purchase of the Norsaga?
5. Whether the contract signed was essentially different from what the plaintiff thought he was signing?
The evidence
Mr Sands
Mr Sands’ employment at the Collinsville mine was terminated in 1999 because of his disability that manifested as an epileptic condition. Whilst other persons, including his wife, told him that he had epileptic episodes, Mr Sands said that he questioned that he was an epileptic:
“… even to this day I still question it, because I don’t feel it come on. I don’t feel having it. I don’t feel it unless I’ve got battle wounds to recognise it.”
As to why he questioned [the diagnosis], he said:
“… I don’t feel it. I don’t recognise it. I don’t understand it.”
Whilst at times he told others – ambulance officers, for example – that he had recognised he had experienced an epileptic episode it was because of the battle wounds. He said:
“… otherwise I don’t know. Sometimes I’ve been wandering around and thinking that something might have happened, but I don’t really know.”
Mr Sands was asked by Mr Honchin if he told Dr Futter that he didn’t remember having seizures and he replied:
“See, this is what people don’t understand. I try to tell them, and even when I [was] down in Southport, I had six neuros and even those guys didn’t seem to understand this. I don’t feel it coming on… I don’t feel it when I have it, and after it, sometimes I wander around unless I’ve got a battle wound or I see something different like a bit of blood or whatever. I wouldn’t have a clue whether I’ve had it or not and sometimes I never known whether I’ve had it and it’s the only time when I’ve got something that’s out of the ordinary or a battle wound or something is the only time I ever known that I’ve had it.”
Mr Sands was asked whether he had been told and knew that he had epilepsy and he replied: “Everyone just keeps telling me, yeah, and I’ve defied it a lot of times.” He was asked if he knew that that was the diagnosis and he said, “So they tell me.”
He was asked whether he had from time to time stopped taking the medication and he denied that was the case. He did not agree with Mr Honchin that he told Mrs Darwen that he had ‘gone off his medication’ and that she would encourage him to get back on to it. Mr Sands said:
“I haven’t been off my medication – I have changed my medication because that Lipitor stuff – I didn’t like that … I stopped taking my medication years and years ago because I couldn’t stand waking up in the morning and getting on it because during the day I would fall off me push bike or something on it and I reckon that’s because I was on that stuff … So I only take it only when I go to bed at night.” He was asked whether he knew that if he had seizures and had a blank he wouldn’t know what would happen until, “he came around” and Mr Sands said he “wouldn’t have a clue”.
He was asked how he was going to deal with that scenario living on a boat and Mr Sands replied, “Well, back then I was going to throw the medication away and live a normal life … right from the word go.”
In the QCCU hearing, when shown the loan agreement document and questioned about it, Mr Sands said:
“I didn’t read any of this. I just signed it.”
and
“I didn’t even go to school, mate, so I wouldn’t have a clue what that [a reference in the loan agreement to a ‘Code of Practice’] is.”
He had first seen the Norsaga many years before that. He spoke to the defendants, which was about a week before applying for the loan. He said that when the loan was made, “I went down and bought the boat”.
As to when the idea came to him to live on a boat he said that had been so since he was young. Mr Sands said he spoke to a person or persons - who were ‘carers’, [because he used the word “they”] – who were from “Flexi Care”. They had been driving him to buy groceries, which he said he stopped doing “so they could give [the time] to someone who had a harder time than I did”. The idea came up from the woman who was driving the car. She suggested that he should “… try and get a loan and see if you can get the boat”. Mr Sands said that “… before that, it never really came up, because I could never afford it – to get a boat.” He thought then that “Wow … maybe have a go at it” and he decided to “… have a go and see if I could get [a loan]”.
He spoke to the defendant Mr Vanderkyl at the boat harbour and asked him if he was thinking of selling the boat. Mr Vanderkyl responded that there was some guy in Western Australia who was thinking about buying it. Mr Sands said he was thinking about buying it himself and he asked “how much”. He was told “$55,000.00”.
Mr Sands wanted to know a bit more about the boat and went back to see Mr Vanderkyl later and told him he was going to see if he could get a loan.
He said the Norsaga one day was put on the slipway. The two of them, he and Mr Vanderkyl, cleared the hull, doing one side each. He asked Mr Vanderkyl how to operate the boat. The autopilot was not working and they had to work on that. He said, “The only thing that was real good was the radio, a beautiful radio.” He said he took “things” [debris or frass] off the deck of the boat and put them in a container, and went to the defendants’ house, gave it to them and asked them to check and find out what it was. Some days later he was told there was nothing to worry about. The “things” appear to be that shown in Exhibit V3; that is, the black particles. I will say something further about this in the course of reviewing the evidence.
Mr Sands did not ‘negotiate’ the price but just paid it. He was aware that the defendants had already paid for 12 months’ berthing fees so “that was part of the deal of buying the boat, I could stay at the same spot at the marina.” Mr Sands said, “I don’t bargain for things like that. If he’s true with me, then I’ll be true with him. And this is probably what’s let me down all my life, trusting in people. I’m straight up with him. I wanted him to be straight up with me… I got cut down again. I’ve been cut down all my life. … That’s just the way it works.”
The QAS and QCCU documents
Four “Queensland Ambulance Service’ (“QAS”) Reports and one QCCU ‘Critical Incident Report’ (items 64 to 68 in exhibit V1, the Agreed Bundle of Documents) refer to incidents of epilepsy affecting Mr Sands.
The Reports relevantly state:
· QAS - 21 February, 2008 – Seen to fall to ground apparently unconscious for a few seconds when talking over fence to neighbour – asymptomatic prior – patient stated he had a history of short duration blackouts caused by his epilepsy.
· QCCU - 08 July, 2008 – stumble and fall against QCCU Branch partition. ‘Loss of consciousness only for a matter of seconds, then he sat up’ Assisted to a seat. He was “… very vague’ and had “no obvious injuries”; and “Now asymptomatic and wished to self-manage his condition … advised to see his MO”.
· QAS - 08 July, 2008 (the same incident) – Unconscious/faint/single event – post-syncope episode. He ‘denies CU staff statement that he fell to the ground while in-line at the tellers. Staff informed QAS that because of patient’s back-pack on his back he did not hit his head. Patient poor with medical history and not really interested in assistance from QAS. Patient informed QAS that he felt fine. Patient informed QAS that he had an appointment in Townsville tomorrow for his annual check-up. Patient stated that it is common for him to have episodes such as todays approximately 2 – 3 times a week.’
· QAS – 11 November, 2008 – Unconscious/faint. On boat Rambling Rose in harbour – wet (fell overboard) – assessed ‘tonic clonic seizure; post immersion’.
· QAS – 09 February, 2008 – Australian Hotel, Bowen – Unconscious/faint/single event – ‘Collapse in Main Street. Patient known to QAS. Suffering epilepsy and has regular fits. Patient is stated to of [sic] collapsed on footpath and then was very vague to talk and wasn’t making any sense to by-standers on scene.’ Abrasion and graze. ‘Patient made aware that he most likely had a seizure but patient declined transport for further investigation. Patient aware of what happened and states this is normal for him.’
Mr Hildebrandt
Mr Hildebrandt had owned power boats most of his adult life. He operated boats in the barrier reef. His boats included timber boats. He met Mr Sands in about 2008. He had not known him prior to that year. He said that he became very close to Mr Sands because he “could discern that this man had a problem, a mental problem, and he would come down to the boat harbour and I would talk to him and then I’d heard he was thinking about buying a sailing boat, which concerned me greatly”. He said that he told Mr Sands never to buy a boat.
He spoke of an occasion when he was on Mr Goodall’s boat. Mr Vanderkyl was present and he asked him not to sell the boat to Mr Sands. He told Mr Sands again not to buy the boat. However, Mr Sands did not take that advice and Mr Hildebrandt was upset when he found out about the sale of the Norsaga to Mr Sands. He said that Mr Sands was hopeless at tying ropes and did not know what a “seacock” was.
Mr Hildebrandt was appointed Administrator for Mr Sands on 29 July 2011. That administration was replaced by the appointment of the Public Trustee on and from 30 October 2012.
Mr Vanderkyl
Mr Vanderkyl had spent most of his life with boats and he had met Mr Sands in Bowen on one occasion prior to 2008. Later, in about June 2008, Mr Sands approached him about the Norsaga and said he would like to buy it but that he did not have any money.
A few weeks later Mr Sands came to his house and enquired about the Norsaga again and asked about the price. He was told it was $55,000.00. Mrs Vanderkyl was also present. Mr Sands had responded that he thought it was a ‘fair price’. Mr Vanderkyl said he was “a little surprised”. He said that exchange did not alert him to anything in particular. When asked if he regarded Mr Sands as an astute boat buyer, Mr Vanderkyl answered, “To be honest, maybe not … I found him a little bit naïve at times.”
He said he met a boat broker, Mr Hinton, on a boat that belonged to Mr Goodall. He says Mrs Goodall and Mr Hildebrandt were not present, to his knowledge, although he did not personally know Mr Hildebrandt at the time.
Mr Vanderkyl described a meeting with Mr Sands in the following terms:
“He [Mr Sands] sat down at our outdoor dining area and we had a cup of coffee and he asked me questions about the boat. I told him what he wanted to know. I showed him some photos of sailing.”
The conversation in the meeting continued:
“Q. What sort of questions did he ask you?
A. Oh, how many sails it had, would it be okay to handle it on your own and I told him that, yes, I handle it on my own. It’s just no drama. He asked me hard it was to manoeuvre in and out of tight spots and that type of thing. He asked me how often I painted it.
Q. Did you talk to him about his boating experience at all?
A. Yes, I did.
Q. What did he say?
A. He told me that he’d done a bit of sailing on boats with other people. He informed me that he was at Hamilton Island one weekend when we raced down there and he had been on board our boat before. All I can remember is him being on our boat at that time. But it would’ve been a social occasion when everybody was on board.
Q. And did he tell you whether he’d owned boats previously?
A. He told me that he’d owned a trimaran some years before.
Q. Did he talk much about his sailing experience?
A. Oh, yes. We chatted about places we’d been, did he like going down the Whitsundays, did he … you know, Bonner [sic] Bay, Montes Resort.
Q. Did you form an opinion in terms of his bona fides about purchasing the boat?
A. Yes, he presented as quite a personable man. He presented as someone who is keen and wanted to live on the boat.
Q. So he expressed something about living on the boat? Is that what he wanted to do?
A. I thought that was pretty good. I said to him I should be living on the boat, because it would make it a lot easier to look after it. Because all the varnish needed doing again and when you are there all of the time, it’s easier.
Q. How long’s he at your place having this conversation for?
A. Would’ve started – I’m guessing at the date. It was about the 20th or 21st June 2008 when he first approached me.
Q. How long was he there at your home talking to you?
A. Oh probably two hours.
Q. Is that the occasion where you told him the price was $55,000?A. Yes, I did.”
Mr Sands told him he was going to take out a loan for the money and sell his house. Following that meeting, Mr Vanderkyl saw Mr Sands every two to three days. He would come to his house by pushbike. They also went to the Norsaga. Mr Sands would stand and watch Mr Vanderkyl open the seacocks, start the motor and wash the decks down. Mr Vanderkyl said, “I didn’t really think that he was an expert, by any means, but he was willing to learn … and I thought that was okay.”
Mr Sands had asked about training and was told that it would be “reasonable training”. Mr Sands knew Mr Radford and after the agreement had been signed and witnessed, Mr Sands paid the money to Mr Vanderkyl.
Mr Sands was with Mr Vanderkyl subsequently when maintenance was done and the Norsaga was occasionally manoeuvred in the water. Mr Sands was not controlling the Norsaga but did put the mainsail up on one occasion after being instructed how to do it. Mr Vanderkyl said he was happy “that with a bit more practise, he’d be okay [handling the boat]”. Mr Sands was also with Mr Vanderkyl when he was trying to get the boat off the slipway cradle and when the boat was being operated. However, he did not let Mr Sands handle the boat until after he had paid the money.
Mr Vanderkyl said that Mr Sands discussed his epilepsy with him on about the second or third visit in June 2008, about a month before the sale. He was told that Mr Sands was in the care of a general practitioner and a specialist. Mr Vanderkyl said he was a ‘little concerned’ about whether or not Mr Sands had it under control. However, he never saw Mr Sands have a seizure. He said he never saw Mr Sands in any difficulty. He knew what a seizure was because he had a sister who suffered epilepsy and he had worked for the Endeavour Foundation for a period of time.
Mr Baker
Mr Baker was previously a branch manager at QCCU in Bowen in 2008. He dealt with Mr Sands with respect to the QCCU loan application. He said he had been aware that Mr Sands had been in a road accident and he had served him quite frequently in the QCCU branch – probably fortnightly over a period of about ten years. He said he assisted Mr Sands with basic transactions such as withdrawals, deposits and assistance with his bill-paying account. He said in evidence-in-chief that he was not aware of any health problem or condition, or mental incapacity.
He said he knew Mr Sands had begun receiving an invalid pension and he knew there was some issue about his health. There had been an incident in July 2008. Mr Sands had been at the “member write-up area” and was seen to stumble and fall against a queue partition. An ambulance was called to attend the QCCU branch and Mr Sands was assisted to a seat in Mr Baker’s office. Whilst he “appeared ok although was very vague and stayed with me until the ambulance arrived”. Mr Baker signed off the QCCU internal report. The Queensland Ambulance Service report states that Mr Sands denied the Credit Union staff statement that he fell to the ground whilst in line at the tellers.
Within the exhibits, there were reports from the Queensland Ambulance Service about other incidents of Mr Sands falling, all of which appear to be related to his medical condition: on 21 February 2008, 08 July 2008 (the QCCU incident), 11 November 2008 and 09 February 2009. Mr Baker said that he did not make further enquiries after the QCCU incident.
However, he said that Mr Sands had told him “he did have a medical condition of some type and was being monitored and was on medication”. He agreed in cross-examination that in hindsight he possibly should have made further enquiry as to Mr Sands’ capacity to enter into the loan transaction with QCCU. With respect to the loan transaction, Mr Baker believed that he had explained to Mr Sands what was involved and believed he understood. He said he had never had to stop a loan process on the basis of an incapacity to understand in the past and he had done thousands of loan applications.
Mrs Vanderkyl
Mrs Vanderkyl in evidence simply adopted what her husband had said about all matters relevant to the hearing, which is not particularly useful. She said she had no concerns about Mr Sands’ mental capacity or ability to function. However, she had driven Mr Sands home a couple of times from her home. In general conversation Mr Sands had told her that he had epilepsy. She knew her husband’s sister had epilepsy. There were no seizures whilst Mr Sands was in her company.
Mr Radford
Mr Radford, who witnessed the sale agreement, knew Mr Sands from having worked at the mines at Collinsville. He said he had no concerns about Mr Sands generally. However, he said Mr Sands had told him how good he was doing in the mines. When asked about this in cross-examination, Mr Radford said he was not aware that Mr Sands had in fact left the mines [and no longer worked there].
Mrs Darwen
Mrs Darwen met Mr Sands at the Collinsville mines in the early 1980s. She said she knew Mr Sands had owned a boat in those times. In 2008 she met Mr Sands in Bowen. She said she saw Mr Sands for social conversations at her shop in Bowen, after 1996 and before 2008.
She said that she had been aware when living in Collinsville that Mr Sands was an epileptic. She said Mr Sands had been a truck driver at the mines. She thought his buying a boat was a great idea and said Mr Sands had been very excited about it. She said they had always talked about his health, the medication and dosages. He had told her that he had ‘gone off’ his medication. He had told her he was going to buy a boat to live on.
Mrs Goodall
Mrs Goodall gave evidence that she was on her and her husband’s boat in 2008 and that Mr Vanderkyl and Mr Hildebrandt were present, with others. She said that Mr Sands’ name had come up in conversation and that Mr Hildebrandt asked Mr Vanderkyl not to sell the boat to Mr Sands because he had ‘brain damage and epilepsy’, that he was sick and wouldn’t be capable of operating the boat. She said to those present that all of this was ‘common knowledge’ in the Bowen boat harbour. She said Mr Hildebrandt mentioned the issues about Mr Sands a couple of times. She knew Mr Sands had problems. He had fallen in the water on one day and had to be fished out. She said that “everyone knew he had problems”.
She said she only recalled this conversation in 2014 after being reminded about the meeting that occurred on her and her husband’s boat, but maintained that she had an independent recollection of it once prompted about the meeting.
The medical evidence
1. Dr Trezise
Dr Trezise has been Mr Sands’ treating general practitioner since August 1999. He said that Mr Sands had a very complicated and severe form of epilepsy which was also associated with a psychiatric condition.
Dr Trezise said that he regularly had consultations with Mr Sands and in the 12 months prior to the hearing he had seen him 14 times. He surmised that the average consultation timing would be just over once a month.
Dr Trezise recalled one consultation where Mr Sands informed him of his intention to have a change of lifestyle which included buying a sailing boat which would replace his residence on the land. He was not aware of any previous history of, or association with boats or sailing, but he was concerned with the stated intention in the sense of it being quite devastating and worrying to him because of Mr Sands’ medical condition.
He said that the medical condition at that time was that the epilepsy was very much uncontrolled and he also had a severe reactionary form of anxiety-depressive state due to his chronic illness and living conditions. A neurologist was consulted at about that time. He said that Mr Sands had frequently had epileptic fits and that there were some difficulties with his compliance with medication, which he self-adjusted by reducing his own dose, from time to time. When he had suffered a seizure, he would be often unsure of whether he had taken the medication. He said that Mr Sands would be aware that he suffered epileptic fits.
Dr Trezise considered that there had been no significant change in Mr Sands’ capacity to understand significant financial transactions, such as a loan to buy a boat or what might flow by way of consequence from the purchase of a boat, between 2008, when he understood the transactions in question had taken place, and the time of the hearing in February 2014.
He considered that the simple concept of buying something and having to pay money for it was within Mr Sands’ understanding, but the consequences of what might flow from a transaction was not. It was the future consequences that concerned Dr Trezise as far as an understanding of a contractual transaction were concerned even if he had been aware that if you borrow money from a lender it has to be repaid. However, the doctor was not sure that he would understand that in default of payment the security taken for the loan might be recovered by the lender [in this case, the house over which the loan had been secured].
Dr Trezise said that the epileptic state was one where after each seizure there was a post-ictheral state which was a period of vagueness which was indeterminate of time and in respect of which it was difficult to determine how long a particular patient would stay in that state. However, he agreed that even in the post-ictheral condition its presentation could be subtle and be unnoticed by an observer.
Insofar as dementia was concerned, Dr Trezise did not express a view save for a reference made by a psychiatrist in a document that he had read.
2. Dr Reimers
Dr Reimers, consultant neurologist, in several reports made the following comments:
11 June 1998 – there was “an abnormal recording showing a focal slow-wave disturbance over the left anterior temporal region”. He considered associated epilepsy could be possible.
19 June 1998 – “This man’s history is very suggestive of a seizure disorder. I think the history would suggest that recently he has been having complex partial seizures. I have told him that I would not regard him as being fit to drive either a motor vehicle or, particularly, a bulldozer at heights. He would need to be seizure-free and compliant with medication for at least six months before I would consider allowing him to resume driving.”
4 May 1999 – “I have seen this man on a number of occasions. He suffers from post-traumatic epilepsy. He was commenced on Dilantin in June of last year and since starting this drug his seizure control has been better, although according to his wife he still suffers from occasional complex partial seizures. Because of his seizure disorder I would not regard him as being fit to work in the coal industry.”
27 November 2008 – “There has been no significant change in his seizure frequency. He experiences about two to three complex partial seizures per week. There is no aura. He is reported to stare and may dribble and fall to the ground. Past medical history has otherwise been unremarkable. The story here is very suggestive of recurrent complex partial seizures.”
3. Dr Futter
Dr Futter, consultant psychiatrist, was asked on behalf of the plaintiff to comment on whether a person with no medical training would be aware of Mr Sands having an impaired cognitive capacity.
Dr Futter said that the MRI scan of Mr Sands showed severe head injury with significant structural brain damage and encephalomalacia (softening of the brain) so that the usual anatomic divisions of the brain are not easily discernible. He said that neuropsychological testing could in fact give a false positive by suggesting that a patient’s decision making capacity is intact when in fact on clinical testing, becomes apparent that the person is not capable of decision making.
Dr Futter said that for a patient to be deemed to have the capacity to make a decision, three criteria have to be satisfied, namely: that the person has to understand the nature and effect of the decision; and the person has to be able to freely and voluntarily make the decision; and the person has to be able to reasonably communicate the decision.
Dr Futter administered a mini mental status examination (MMSE) which scored 23 out of 30. He said that “this score puts him into the range for the diagnosis of a dementia due to an organic brain injury”. He opined that the motorcycle accident that gave rise to that injury would have resulted in a cognitive decline that would have remained unchanged in the ensuing period. Dr Futter said the use of the MMSE was not to establish or diagnose this and not to come to any conclusion about the patient’s capacity. It was to establish the existence of a degree of cognitive impairment. He said that incapacity was not dependent on any specific diagnosis. Rather, it was dependent on the ability of the person to understand and act on information relevant to making a specific decision and to appreciate the consequences of that decision.
He opined that the decision to take out a loan and to buy a boat with the understanding that he would have to live on the boat together with the consequence of the financial arrangements necessary were not matters that Mr Sands would have understood. That included the consequence of the risk of falling from the boat into the water if he had an epileptic seizure. He said that Mr Sands’ capacity to know about the consequences of receiving a loan were impaired. He said that Mr Sands thought “very concretely” and whilst he was capable of sustaining a “superficial conversation”, when any detail was sought he was unable to comply. Dr Futter referred to Mr Sands not being able to explain why he was on a disability pension and not having any idea how much his pension was or what deductions had to be made from it. He also did not understand the concept of having to pay rates for a house.
He said that if an average person stood behind Mr Sands in a supermarket queue and engaged him in light conversation, they may have no idea of his capacity. However, when asked specific questions the cognitive difficulties would soon become evident. Dr Futter considered that if Mr Sands had been interviewed with respect to an application for a loan, an average lay person employed by the financial institution should have noted the impaired cognitive capacity of the customer. Similarly, he said that if the average lay person sat with Mr Sands to negotiate the terms of the contract for sale of a boat then they would be alerted to his impaired cognitive capacity and put on notice that he did not have sufficient capacity to enter a transaction.
He said that Mr Sands’ severe brain injury at the time of his accident was enough to impair his decision making capacity and testing the different domains of cognitive functioning would not throw any further light on the issue.
Dr Futter concluded that Mr Sands was not able to understand the nature or effect of the decision to buy a boat or to apply for a loan to buy it. He said the dementia to which he referred was due to brain injury. It was not of a progressive nature such as may be suffered by other persons. He considered that the evidence of dementia would be a matter for anecdotal evidence, in effect, from persons who knew Mr Sands before and after the accident.
Dr Futter’s view was that as a result of the impaired cognitive capacity and his lack of insight into his epileptic state, Mr Sands lacked the capacity to make significant decisions about his financial affairs and that such lack of capacity would have existed in 2008 when the negotiation and purchase of the boat occurred.
In the oral evidence at the hearing, Dr Futter confirmed that Mr Hildebrandt had been present at the consultation. It seems that Mr Hildebrandt provided information and support for Mr Sands, to him. He had relied on the referral material and Dr Reimer’s reports. He said so far as epileptic seizures were concerned, a person would not necessarily know that one had occurred. Insight about seizures may fluctuate. He said that the consequences of buying a house were different from those of buying a boat, in Mr Sands’ circumstances.
At the end of further cross-examination by Mr Hockings (for the QCCU) he was asked a question on a hypothetical basis: that if Mr Sands was buying a house on dry land would he have the capacity to enter into a loan contract and mortgage? Dr Futter replied that, “On the day that I saw him, I’d have to say that he probably would understand, but I didn’t have any specific questions relating to buying a house. You see, that’s why the clinical assessment of capacity relates to the decision at hand.”
However, in re-examination by Mr Byrne, Dr Futter said he would have to retract his statement about the capacity to obtain a loan to buy the house because, in effect, it was contrary to his earlier evidence that Mr Sands’ did not know how much his pension was, what deductions had to be made from the pension and he failed to understand any concept of paying rates for a house. He explained that he had been somewhat fixated on the consequences of, rather than the ability to understand, such a contract and to act on information relevant to making a specific decision.
4. Dr Varghese
Dr Varghese, consultant psychiatrist, provided an opinion to the lawyers for the QCCU in respect of the case it made against Mr Sands. Dr Varghese did not consult with Sands. His opinion was based on documents, including those relating to the QCCU loan and the medical reports provided by other medical practitioners, including another consultant psychiatrist. Dr Varghese primarily focussed on the latter reports in forming his opinion.
Whilst he was retained for the purpose of an opinion by QCCU and therefore focussed on the loan transaction made by that financial institution to Mr Sands, nevertheless the opinion has some comparative relevance to the subject litigation which concerns the action by Mr Sands against the present defendants about the sale and purchase of the boat.
Dr Varghese summarised what he understood of the reports of Dr Trezise, Dr Reimers and Dr Futter and expressed opinions about them.
With respect to the report of Dr Trezise, he expressed a doubt that an “anxiety depression state” of itself would impair a person’s capacity to enter into a financial contract unless it was so severe as to amount to a state of dementia. He contrasted failure to make ‘good decisions’ with ‘impaired capacity’ and distinguished those relative states.
Dr Varghese did not consider epilepsy to be directly relevant. However, “post- ictheral confusion” (that is, episodic post-fit seizure mental impairment) could be relevant, but would need to be noticeable although it could present as a subtle state to an observer. He considered poorly controlled epilepsy can be associated with gradual intellectual decline.
With respect to the reports of Dr Reimers, he said that there was definitely evidence of a brain injury and it was probable that the epilepsy resulted from that injury. He expressed the view that a person who has a ‘complex partial seizure’, “may present as odd movements, speech difficulties and clouding of consciousness which can sometimes be subtle but there is decreased awareness of the environment to varying degrees”. In such a state (which is mostly brief but can be prolonged), an individual would not have the capacity to enter into a financial contract at the time.
With respect to the report of Dr Futter, he questioned some of the bases that Dr Futter relied on in arriving at his opinion that Sands had an impaired capacity. He did not agree that the MMSE result obtained in the analysis made by Dr Futter indicated dementia to the extent of impairment of capacity. He referred to the MMSE as being a screening instrument which might indicate a need for further and more specific investigation before any determinative finding could be made.
Dr Varghese considered that a lack of insight into epilepsy may indicate frontal lobe damage in addition to the temporal lobe damage.
He doubted the presence of dementia because Mr Sands would not have been able to work as a coal miner prior to the emergence of the epilepsy. In oral evidence before me, Dr Varghese was asked about the work history of Mr Sands on the basis that Mr Sands’ employment in the mines as a’ bulldozer operator’ had been terminated because of the emergence of epilepsy. He agreed with Mr Byrne that if the employer knew that an employee was having seizures whilst employed as a ‘truck driver’, that would be extremely negligent conduct by the employer. Dr Varghese said that the fact that someone with epilepsy was having seizures did not of itself remove capacity unless that person was engaged in a [contractual negotiation/agreement] at the time of a partial complex seizure or during a pre or post-seizure stage, because epilepsy was an intermittent condition.
Dr Varghese expressed the view that despite the brain injury if Mr Sands was able to work in a reasonably skilled occupation which would require a certain degree of cognitive function, it would be unlikely that there would have been deterioration in his state unless the epilepsy had been so poorly controlled that he had experienced periods of ‘anoxia’ which could have led to the deterioration.
He was asked about impulsivity in the context of the purchase of the house by Mr Sands being impulsive, having for example occurred without an inspection being made of the property. He referred to persons who had made bad decisions as a consequence of impulsivity and said that did not mean that the persons necessarily lacked capacity. However he did say that frontal lobe dysfunction would certainly affect capacity. Whether capacity was fully lost would be debatable but there would certainly be impairment.
The issue of psycho-social functioning was one which Dr Varghese thought might reflect on the issue of capacity in the sense of adding another layer of information upon which an analysis could be made. This included things such as work history, financial dealings, marriage relationship and whether there were issues of compensation being paid for specific conditions.
Dr Varghese considered that there was insufficient documentary data to indicate capacity or not. He expressed his view that he could not say one way or the other, in the following terms:
“Given the head injury and demonstrable brain damage as evidenced by the CT scan and the MRI leaving aside the question of epilepsy, it may well be that Mr Sands lacks capacity or is impaired in capacity with respect to entering the contract. However, as discussed in my comments with respect to the report of Dr Futter, one could not conclude from the report that there was indeed loss or impairment of capacity. Please note again that the MMSE result of 23 out of 30 is not meaningful on its own and that the instrument is a screening instrument. Further detailed neuro-psychiatric assessment is required and perhaps neuro-physiological assessment.”
Dr Varghese agreed in cross-examination by Mr Byrne that he could not give an opinion on whether Sands had capacity or not.
PART B: SEAWORTHINESS OF THE NORSAGA
The agreed matters in issue on the allegation of unseaworthiness of the Norsaga
The agreed matters in issue were:
1. The seaworthiness and general condition of the Norsaga at the time of sale.
2. Did the defendants meet the terms of the sale agreement?
The word “seaworthy” is defined in The Macquarie Dictionary, 2nd Revised Edition as “adj. (of a ship) adequately and safely constructed and equipped to sail at sea.” The word “seaworthiness” is the noun.
The evidence
Mr Sands
Mr Sands said to Mr Honchin that when he lived in Collinsville he had bought an old fibreglass trimaran and had it for about eighteen months. He said that it had been a boat wreck that the sellers had found and had fixed up. He was asked if he had raced the boat and he replied, “I could never race a boat by myself at that stage, no way in the world.” He said he learned to sail and that’s why he ended up buying the trimaran and he felt quite comfortable doing that himself and that he did go out overnight on the trimaran. He did not do any extended voyages. He would have loved to spend more time on the trimaran “especially to learn more about how to handle a boat myself and all that stuff. That was the whole idea of it.” This appears to have been at a time prior to Mr Sands’ motor vehicle accident.
Mr Sands said he did not doing anything to check out the soundness of the boat or whether the boat was okay because “… I trusted him”. He did not engage a marine surveyor or boat labourer or someone to have a look at the boat. Mr Sands said that he was told by Mr Vanderkyl that there was:
“… a little bit on the deck that needed to be done because when I first seen him, he was up there sanding it back with a big sander or a big disk sander, and he told me about that, but otherwise no. The rest of it was supposed to be in good nick. He’d just ripped the motor out and fixed it up and that was ready to go. The only other thing is trying to get the autopilot and those particular things going.”
Prior to the sale Mr Sands had taken one trip on the Norsaga around Stone Island in ‘the port’.
He said that Mr Vanderkyl told him that the boat was in “good condition” and he said he told Mr Vanderkyl he intended to live on the boat. He said he didn’t think he needed to do anything, such as checking the soundness of the hull by tapping it with a hammer “or something like that”, even when they were cleaning it down. He said the boat was “flat on the water”. Mr Sands said that prior to the sale he was shown the engine compartment in the boat. He described it as a “… bit of a nightmare, most of the wiring and all that. A few things he was still playing with through [sic] that stuff to check it out and make sure it worked and all that stuff’. I’m not a technician or anything like that, it was a nightmare trying to work that stuff out myself.”
He had been present when the Norsaga was put into the “dry dock” by Mr Vanderkyl.. He continued,
“Q… Mr Vanderkyl had you manoeuvring the vessel while he indicated left or right for him?
A. Oh no. No. No. No. That’s his baby, mate, not mine.
I assess damages at 70% of the purchase price: that is, the sum of $38,500.00.
Interest
The plaintiff is entitled to interest on the judgment sum. However, I will hear the parties on the rate and the period over which interest should be calculated.
Costs
Costs generally follow the event: that is, the successful party is entitled to his costs of the proceedings on the standard basis. The plaintiff was substantially successful. However, I will hear the parties further as to costs.
ORDERS
1Declaration that the contract, written and oral, made on 21 July 2008 is voidable at the suit of the plaintiff on the grounds of lack of capacity and/or unconscionable conduct and is set aside.
2further and in the alternative the defendants were in breach otf the terms of the Agreement for sale made on 21 July 2008.
3the plaintiff is entitled to be compensated for loss arising from the setting aside of the agreement for sale or the breach of the Agreement for Sale, by an award of damages.
4Judgment for the plaintiff against the defendants in the sum of $38,500.00, plus interest.
5That upon payment of the judgment sum including costs by the defendants to the plaintiff, the plaintiff give possession of the wreck of the vessel ‘Norsaga’ and the two masts to the defendants.
6I will hear the parties as to the rate and period over which interest should be calculated.
7I will hear the parties further as to costs.
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