Simcit & Simpson Packing v Abbott Australasia No. DCCIV-95-31388

[2001] SADC 27

Simcit Pty Ltd & Simpson Packing v Abbott Australasia Pty Ltd
[2001] SADC 27

Judge Kitchen
Civil

1 In this action each of the plaintiffs claims that it suffered loss and damage as a consequence of a reduction in the quantity of fruit produced between 1994 and 1998 by Lanes Late navel orange trees on land at Millewa in the State of Victoria. It is alleged the reduction in the quantity of fruit was caused by the spray application of a proprietary product, known as “ProGibb” containing gibberellic acid (GA3) manufactured and distributed for sale by the defendant, which the plaintiff Simcit Pty Ltd (Simcit) claims it applied to the trees in February 1993 at a rate of 20 ppm recommended by one Mr Michael Barrett, an employee of the defendant, at a seminar or meeting of citrus fruit growers held in Loxton in December 1992 which was attended by representatives of the plaintiffs. The claim is that the loss or damage allegedly suffered by the plaintiffs was caused by conduct, the recommendation of Mr Barrett, which was misleading or deceptive contrary to Section 52 of the Trade Practices Act or Section 56 of the Fair Trading Act, or it was false or misleading contrary to Section 53 of the Trade Practices Act or Section 58 of the Fair Trading Act; the plaintiffs also allege that Mr Barrett’s recommendation was a false representation and they claim damages pursuant to the Misrepresentation Act, they claim that the defendant was negligent and finally they allege that the defendant is in breach of the warranty as to merchantable quality implied by the Manufacturers Warranties Act 1974.

2      It is not disputed that the defendant manufactures and distributes for sale the product ProGibb and that it contains gibberellic acid, or that Mr Barrett (admittedly an employee of the defendant) at a meeting or seminar in December 1992 advised those present at the meeting concerning the rate of application of ProGibb to citrus fruits, but it is denied Mr Barrett recommended it be applied at 20 ppm.  The defendant further denies each of the statutory causes of action upon which the plaintiff relies or that it was negligent and takes issue with the loss or damage alleged by each of the plaintiffs.  The defendant also pleads and relies upon an exclusion of its liability contained in a leaflet attached to the product ProGibb at the time of sale and, alternatively pleads that the plaintiffs knew at the time of applying the ProGibb product that a reduction in crop yield could occur.

BACKGROUND

3      Simcit is the trustee of the Simpson Family Trust constituted by deed made in November 1980, the specified beneficiaries of which include the four Simpson brothers David, Robert, John and Ian.  The brothers are the sons of James Simpson, now deceased, who owned about twenty-one acres of land in Loxton where he produced citrus fruit;  he obtained that land in 1948 as a soldier settler.  In about 1969, because of their father’s ill health, the brothers formed a partnership and took over his business.  In 1972 a fruit packing shed was purchased by the partnership as an extension to the fruit production business which, by that year, was growing citrus fruit and grapes on some seventy-five acres of land.  Ian and David managed the packing shed, John and Bob the production of fruit.  The partnership processed its fruit, and the fruit of other growers, through the packing shed.

4      The partnership promoted the incorporation of the plaintiff Simpson Packing Pty Ltd (Simpson Packing) and it thereafter conducted the fruit packing business;  the brothers, or interests associated with them, own all the issued shares of Simpson Packing.

5      In about 1978 the partnership acquired approximately one hundred and sixty acres of land at Millewa, on the banks of the Murray River, comprising eighty acres freehold title the balance being leasehold;  the leasehold land was converted to freehold in the circumstances I will relate later in these reasons.  At the date the Millewa land was purchased there were eight acres of grapefruit trees and areas planted with Washington Navel or Valencia oranges.   Ian Simpson described the property to have been poorly managed and “shockingly run down”.  Some of the freehold land was “virgin” land in the sense that no citrus trees were growing on it.  In 1980 some 12 acres of the virgin land were planted with Lanes Late navel orange trees, which I will sometimes refer to as “Lanes Late”.  That is the plantation with which this claim is concerned.  It is agreed the area is 5.5 hectares.

6      Mr Ian Tolley is an horticultural consultant with a specialist interest in citrus during the last fifty years, particularly in the Riverland and Sunraysia districts.  He is the author of many papers.  In his specialist field, he provides consultancy services to citrus growers in Australia and overseas and he conducts a citrus nursery.  He related that “citrus mutate freely throughout the world but especially in Australia through the ultra-violet influence and for this reason the Sunraysia and the Riverland are prone to mutations” (657).  He said that in the 1970’s he was called upon by Mr Lindsay Lane, a citrus grower near Mildura, to investigate and verify a mutation which Mr Lane had observed some time earlier - a limb of a particular navel orange tree produced fruit which remained at a green stage long after the fruit on the remainder of the tree had fully coloured and had to be picked.  This late “ripening” has a potential commercial advantage.  Mr Lane had propagated the mutation by budding it onto Washington Navel tree stock in his nursery which he planted in his orangery.

7      The commercial advantage of a late ripening citrus variety lies in it being left on the tree until as late as December, aided by the spray application of 2,4D (a chemical marketed under the trade name “Cit-tite” or “Stop-drop”), when they are picked and packed and sent to market, whereas “non-late” varieties are picked and packed in about September on and if they are to be sent to market in December or later it is necessary to keep them in cold storage which causes deterioration in the fruit.  The market price for the late variety is greater than that for the earlier ripening fruit kept in cold storage.  Further, Ian Simpson said, buyers wanting the preferred Lanes Late could be “required” to also purchase quantities of the less popular Valencia oranges although, as I understand, that was a strategy which applied only in the earlier years of the marketing of the Lanes Late.        

8      Mr Tolley took “buds” from Mr Lane’s trees which he propagated in his nursery.  He said he found them to be stable, that is they did not revert to the variety of the root stock to which they had been budded.  He propagated some 40,000 of the Lanes Late variety on various root stocks and “trialled” them with growers in different regions.  He said that in the late 1970’s all the “trialling” growers reported to him that they had picked Washington Navels before the Lanes Late had “coloured”.

9      Ian Simpson described that he found the Lanes Lates planted in 1980 to be “fickle trees”; the thumb-nail sized fruitlets would drop off for no apparent reason.  The first harvest in 1984/85 was 28 tonnes which increased to 143 tonnes in 1987/88 followed in 1988/89 by 67 tonnes.  Beginning when the Millewa property was purchased in 1978 the irrigation system was continually improved and refined according to the advice obtained from experts engaged for that purpose.  As I understand his evidence, in about 1988/89 and to try to combat the Lanes Lates dropping fruitlets, irrigation was applied to the trees during the hottest part of the day “to cool the environment down”;  the 1989/90 harvest was 154 tonnes, followed in the succeeding years by 147 tonnes, 175 tonnes and 400 tonnes in 1992/93.

10     In 1987 Simcit planted Lanes Late on another area of the virgin land at Millewa;  that is the patch referred to in evidence as the triangular piece - it is marked F in Exhibits P1 and P7 - and called the ‘87 Lanes.  The 80’s Lanes Late are shown marked C, D and E in the same exhibits.  In that year, 1987, Ian and John Simpson swapped roles - John took over the running of the packing shed and Ian the overseeing of the fruit blocks including Millewa.  Some years before that occurred, David in 1981 had gone to Coffs Harbour in Queensland to develop a market there for oranges;  he was unsuccessful and after twelve months he returned to the packing shed operation in Loxton where he remained for six months before he purchased a fruit stall in the East End Market which he developed to specialise in oranges and later, in a venture with all of the brothers and others, a business concerning bananas.  In 1984 Bob went to Queensland where he and his brothers, through the vehicle of Aneva Pty Ltd in a venture with one Peter Battams, purchased 360 acres of land which was producing citrus and included a packing and juicing shed;  the investment of the brothers to obtain 80% of that venture, and its ongoing financing and re-arrangement, is a topic agitated by the defendant on the issue of the loss and damage claimed by the plaintiffs in the context of what the plaintiffs say was the need to defer for about two years the establishment of a Navelina Orangery on the Millewa land.

Concerning the plaintiffs, Mr Barrett and the use of ProGibb

11     John Simpson became a member of the board of Riversun, an organisation which had been formed by citrus fruit packers to co-ordinate the supply of oranges to the United States of America, a large and lucrative market, which had opened up to Australian producers in 1992, particularly those in the Riverland because it was free of fruit fly;  Simpson Packing first supplied Navel oranges to the U.S. Market in that year but not fruit from Millewa the area of which did not obtain a disease free status until, it would seem, 1995/96 (T1846)   However fruit sent to the U.S. was identified to have a “problem with creasing” known as albedo break-down which causes the rind of the fruit to split making it unmarketable. The albedo is the internal rind (Exhibit P73).   This “break-down”, John Simpson said, occurred in navel oranges, in some years worse than others.  That phenomenon led to Riversun directing exporters to the U.S. market to require growers to use gibberellic acid to (John Simpson related) “slow down the creasing problem”.

12     Mr Peter Barry has grown citrus and other fruit on land at Loxton for about fifteen years.  He also conducted a business as a contract sprayer in the years 1984 to 1990 and in that connection in March and April he used ProGibb,  which he was aware contained gibberellic acid, to spray the Navel and Washington orchards of growers at the rate, he recalled, of 10 ppm.  By 1992 Mr Barry was employed part-time by Simpson Packing as the grower liaison officer and in that capacity he put out a memorandum to growers inviting them to attend a meeting on 29 September at the packing shed upon topics including “a general discussion of G/A sprays on navels and tests carried out at Waikerie to reduce Albedo by spraying Gilbritic (sic) Acid” and “John shall also inform growers as to what the Packing House requires from growers to ensure a continued involvement with the very lucrative market in the U.S.A.”  (Exhibit D67). The year of the proposed meeting is not noted. The “John” referred to is John Simpson.  Ian Simpson does not recall there being, or that he attended, such a meeting.  John Simpson thought there may have been a meeting in September 1992, after the fruit shipment to the US in that year, but he could not remember that there was such a meeting or, if it occurred, the topics dealt with.

13     On 19th February, 1992 the Loxton News published an advertisement to the effect that a meeting would be held on 24th February, 1992 at the Loxton Hotel at which Mr Barrett would speak on “the use of ProGibb GA for use on citrus”.  Ian Simpson saw the advertisement and attended the meeting with Mr Ken Lowe the manager of the Millewa property.  Ian Simpson said he recalled Mr Barrett spoke to a group of some six persons upon the topic of “the on-tree storage of Lane navels... He said he could help us with that problem” (78).  By this time Simcit also had two other properties, planted with citrus, known as Pettmans and Shed (sometimes referred to as Olsnicks);  the first property comprised about 30 acres on some 21 acres of which there were mandarins, Washingtons and Lane Lates (planted in about 1989 to 1991), and the second a property of 28 acres included some 5 acres of Lanes Late planted in 1978/1979 the balance being made up of Washingtons and Valencias and vines.  Ian Simpson had the responsibility to oversee the management of the Pettmans, Shed and Millewa properties.

14     In cross-examination Ian Simpson said that before 1992 he had used GA extensively on grapefruit for the purpose of holding “the fruit on the tree until the fruit would become palatable” (254) and had used it on Washington Navels at the Shed property on some occasions for the two-fold purpose of aiding the fruit “to hang longer and in better condition” (266).  He said he had completed a safety course in applying chemicals in which, he was taught, it was a good and safe practice to read documents which came with any chemical product, that in relation to ProGibb he believed he had done that and although he could not specifically remember doing so he would probably have read the “exclusion” clause (260).  He said concerning Lanes Lates that they were “supposed” to hang on the tree until December but when they did that the fruit was not in “good nick” so he was picking them in October/November, usually in October;  he was looking for a means to aid the fruit to hang longer and in good condition.  He said that at the meeting on 24th February, 1992 Mr Barrett spoke about ProGibb in the context of on-tree storage and he told Mr Barrett he “would like to be able to store our Lanes Lates on the tree”.  He agreed that at the meeting there may well have been discussion about the phenomenon (known to him) of a heavy late crop on citrus trees having the effect of reducing the following year’s crop, but he rejected the suggestion that Mr Barrett (then or when he visited Millewa soon after the meeting)spoke about, or there was discussion concerning, the use of ProGibb in the context of creasing or that Mr Barrett said in effect he had no experience with the use of ProGibb on Lanes Late;  he said that the topic of the use of ProGibb was directed to holding fruit on navel citrus trees and in that connection the application rate of 10 ppm was mentioned.

15     At the meeting Ian Simpson invited Mr Barrett to visit the Millewa property;  Mr Barrett, I find on Mr Lowe’s evidence, did so on 6th March, 1992 and brought with him sample bottles of ProGibb.  Mr Barrett was at the property for some three hours during which he spoke of the necessity to ensure that the application of spray was at the greatest volume and pressure to totally cover all fruit and he assisted Ian Simpson and Mr Lowe to “set up” the spraying machine at Millewa and advised about the rate of travel through the orchard to obtain that.  The machine is of the type depicted in photograph Exhibit P8.  The setting up of the spraying machine was achieved by the use of water only - no ProGibb was used on that occasion.  Mr Lowe said and I accept that he told Mr Barrett he would use all the provided samples.

16     The samples provided by Mr Barrett at the application rate of 10 ppm were sufficient only to use it on eight rows of the 80’s Lanes Lates;  Mr Lowe said, and I accept, that the ProGibb samples provided by Mr Barrett were in both a liquid and powder form and Mr Barrett told him to mix 150 millilitres of the liquid, or one and a half small bottles of the powder, with each 1500 litre vat of water.  He produced a note, Exhibit P25, containing that information which he said he wrote on the day Mr Barrett visited Millewa.  His memory is that there was some discussion with Mr Barrett about growers in the United States starting to use more ProGibb in its powder form rather than in its liquid form. 

17     On 24th March, 1992 Mr Lowe, as I accept, mixed the ProGibb in those proportions and using the spray machine as it had been set up on 6th March, 1992 he sprayed four vats of the liquid ProGibb mix on the four adjacent rows of 80’s Lanes Late south of a valve pointed out at a view the Court had on the Millewa property, and four vats of the powdered ProGibb mix on four rows north of that valve.

18     Mr Lowe said he does not remember if the fruit on the eight treated rows was left to hang on the tree longer than the untreated rows and when the 80’s Lanes Late were harvested in 1992 he did not notice any difference between the fruit of the treated and the untreated rows.  Ian Simpson said he could not remember what was the result of spraying the eight rows, or when they were harvested.   I find it odd that the application of ProGibb in March 1992 being to test whether the fruit did hang on the trees longer no observation was made, or if made remembered, whether it was efficacious or not.  However I accept Mr Lowe’s evidence that when ProGibb was again used on 12th February, 1993 at Millewa he did not apply it to the eight rows treated the previous year because he “felt that the number of fruitlets on the tree seemed to be generally less than in the area where we were going to spray the rest of the product” (354), and I also accept his evidence that in 1992 he noticed the fruit of the 80’s Lanes Late was affected by creasing, albedo, and it was to learn something about that problem that he attended a meeting on 3rd December 1992 at the Loxton Golf Club which Mr Barrett also attended.

19     I interpose here that Mr Barrett did not give evidence.  At the time of trial he was a resident of the United States.  Mr Barrett, Mr Lovell informed the Court, was unfit to travel but despite the opportunity to procure a medical certificate, or the like, to substantiate that nothing was forthcoming.  He would have been an important witness for the defendant’s case.  His absence is insufficiently explained.  I infer his evidence would not have helped the defendant’s case.

20     The meeting at the Loxton Golf Club was arranged by Ian Simpson.

21     I have earlier referred to Exhibit P67, a note to growers prepared by Mr Barry on behalf of Simpson Packing inviting them to a meeting on 29th September, in 1992, at the Packing Shed.  Among the documents tendered by the defendant is Exhibit D24B, a publication by the Department of Agriculture headed “Citrus Notes.  Creasing in Oranges “Trial Update””.  It is dated 10th September, 1992 and I infer it was prepared by Mr Greg Moulds an horticultural adviser, employed by the Department whose name it bears, to inform citrus growers about a project “to demonstrate and quantify the benefits of gibberellic acid (GA) applications to reduce creasing”.  The document refers to creasing trials  conducted at a Washington navel orchard in Waikerie and a valencia orchard in Renmark to each of which GA had been applied at rates of 10, 20 and 30 ppm and shows graphs of the affect on creasing at those rates.  It reports “If spraying for the control of creasing, fruit needs to be 30-50 millimetres in diameter and this is usually in late January, or early February” and under “Conclusions.  A - Control of creasing (navels)”  it states:

“... 

(4)... The application of GA to reduce creasing should be applied using a concentration of 20 parts per million, GA application does not totally reduce the incidence of creasing, but allows more fruit to be packed over a  longer period of time”

22     Ian Simpson said he was in contact with Mr Moulds, that in 1992 growers were experiencing problems with creasing, that he recalled some trials about creasing being done but, although he may have done so, he does not specifically remember talking to Mr Moulds about trials at Waikerie and while agreeing such notes “citrus notes” came to the premises of Simpson Packing where he had his office he does not remember seeing Exhibit D24B.  Exhibits D24 and D24A are also “Citrus Notes” on the Department’s letterhead stated to be written by Mr Moulds and dated December 1992.  They appear to be the same, but on a reading of them there are differences.  One of them (D24A) bears a handwritten note admittedly made by Mrs Diedre Simpson, John’s wife and employed by Simpson Packing;  it reads:

“Please disregard the previous circular written by Greg Moulds (it was handed out at the last growers meeting at the Golf Club).  Please contact Peter Barry within the next week to discuss fruit supplied for the U.S. market plus the application of sprays.  Thanking you.  Dee Simpson”

Exhibit D24A was discovered from among the records of Simpson Packing.  D24B, as I understand, was an annexure to a report prepared by Dr James Robinson, who gave evidence for the defendant.  John Simpson, concerning D24B, said that documents like that would be provided by the plaintiffs’ advisers if they were relevant to the subject matter of the advice being given, he could not say whether a copy of that exhibit was received by the plaintiffs and said that prior to the meeting in December 1992 he was not aware of the Department’s (and I infer Mr Mould’s) recommendation concerning the application rates of GA.  Dr Robinson said, as to D24B:

(1420)

"Q.... “Did the Department of Agriculture in South Australia from time to time publish things such as this, citrus notes.

A...... Yes.  This is going back quite a way now but at that stage the citrus group programs that are usually the way extension information is moved throughout the industry, were not so strong as they are now.  So, you know, a pro-active horticultural adviser like Greg Moulds would publish something like this for his group.

Q...... Was this distributed, as far as you are aware, throughout South Australia.

A...... It was widely available.  I saw copies of it on the Loxton Research Centre shelves and other places around.  There is a lot of interest in it.”

Ian Simpson’s evidence was that before the meeting in December 1992 he had “been talking to Mike Barrett and I believe that’s were I got the 20 ppm from” as the application rate of gibberellic acid for creasing.  It is clear in my opinion that before the December 1992 meeting the plaintiffs knew of the Waikerie trial - that is evident from Mr Barry’s memorandum to growers, (Exhibit P67), inviting growers to a meeting upon, inter alia, the topic of those trials but I am not satisfied that either Ian or John Simpson knew of the Department’s (and Mr Mould’s) recommendation in September 1992 that GA be applied at 20 ppm to minimise creasing.

23     Ian Simpson said that after the eight rows had been sprayed with ProGibb he spoke with Mr Barrett at the Packing Shed on two or three occasions in 1992, when Mr Barrett was in the Riverland, and he raised with him the albedo break-down problem.

"A..... “Well that particular year we had a huge problem with creasing and in conversation Mike Barrett said that he reckons he could fix creasing with GA, and through those discussions with him he and I arranged a meeting at the golf club so he could address some of our growers.

Q...... Did you tell him what your problems were with creasing and whether they were in respect of any, and if so what variety.

A...... We discussed our problems and other growers’ problems and discussed creasing in Washingtons as well as Lanes.

Q...... So both.

A...... Yes

QDid he say anything to you which distinguished between the creasing problems in Washingtons and Lanes or was it discussed in the same context.

A...... It was a problem common to both varieties and it was discussed as a whole.

Q...... Did he say anything to you in those meetings that he had with you, before you helped to organise this meeting later in the year, did he say anything to you about how he would use the gibberellic acid as distinct from saying it could be used.

A...... Yes he did.

Q...... Just tell us as best you recall what he said.

A...... I believe he told me prior to the meeting in December that by using 20 ppm we could fix the creasing problems in navels.

Q...... How did you go about organising the meeting.

A...... As I said before, Mike was a guy that liked a beer and the idea when he had these growers’ meetings - it’s a bit peculiar I guess to country people, but they love to have a feed and have a beer at these meetings, so that was the context of it.  We organised a barbecue and some drinks afterwards.

Q...... The meeting was publicised.

A...... Publicised to our growers, yes.”

24     Exhibit P10 is a copy of a circular sent to growers by Simpson Packing.  It is dated 27th November, 1992 and signed by Mr Barry.  It includes:

“All growers are urged to attend a meeting at the Loxton Golf Club at 5 p.m. on Thursday 3rd December.

I cannot stress the importance of this meeting as we will be discussing the application of ProGibb on navels that will be required for the American export market.  Mike Barrett from Abbott Agricultural Products will be here to suggest rates and timing of these sprays.

We will be requiring a commitment from growers of the tonnages they will be treating.  An inspection of spray applications will be carried out.  All growers will be required to carry out this procedure or their citrus may not be allowed to be exported to America.”

25     Ian and John Simpson, Mr Lowe, Mr Barry and Mr Darrell Lang, a fruit grower, attended the meeting on 3rd December 1992;  so did Mr Moulds, Mr Barrett and two other employees of the defendant Mr Frank Gallucio and Mr Gordon Childs.  John Simpson chaired the meeting which was attended by (the witnesses estimated) twenty to thirty persons including growers.  Those who attended and gave evidence estimated that the meeting lasted for up to two hours.

26     Ian Simpson said that copies of the defendant’s information sheets, Exhibits P2 and P3, concerning ProGibb were handed out; P2, under the heading “ProGibb.  The Plant Growth Regulator for use on Navel Oranges and Ellendale Mandarines” sets out in dot points the benefits of using the product and includes a chart showing its application rate to navel oranges, in States including South Australia, at 10 millilitres per 100 litres and Mr Barrett and Mr Gallucio are named as the defendant’s representatives from whom further information may be obtained.  P3 is headed ”ProGibb Mixing Chart” and sets out in tabular form mixing instructions for the “desired” rate of ppm ranging from 5 ppm to 60 ppm.

27     John Simpson said that he introduced both Mr Barrett and Mr Moulds to those who were at the meeting and “I gave a talk about where we were at with the American market;  the navels and the creasing problems that we had encountered and the need to - they were what Mr Abbott (sic) was saying with respect to the application of GA so we could improve our Pack House” (p1121/22).  He said Mr Barrett then spoke.

(p1122-1126)

"Q.... Can you remember how long he spoke for.

A...... I’d say that the discussion probably went for around about a couple of hours.  Now, what I mean by that is that in the first instance he would have given his speech for possibly half an hour or whatever; and what we proceeded to do from there was to have interaction from the growers.  So it was a question and answer type thing that I would say it would have taken about two hours.

Q...... Can you remember whether Mr Barrett spoke about creasing and the use of the product ProGibb.

A...... That’s the reason he was there; so yes, he did.

Q...... Tell his Honour as best you can recall what he said about the use of the product for creasing, what you recall Mr Barrett said at that meeting.

HIS HONOUR:          About GA and creasing.

A...... With respect to the volumes and application and all those sorts of things?

XN

Q...... Yes.  What can you remember about all of that.

A...... His recommendation that 20 ppm should be applied and that would solve the creasing problems.

Q...... Do you remember whether he said anything about when it should be applied.

A...... Yes, he - we talked about golf ball size as a size of the individual pieces of fruit, and the reason we talk about golf ball size is that is because that allows you with the spray plants and the application rates to cover the total fruit with the chemical.  That’s critical with respect to GA, because if you leave it too late you will only get the affect on one side of the fruit.  So again, to come back to your Honour’s question before, with respect to how you would identify with a grower that applied the thing that was the problem we had.  That some of their spray plants weren’t up to the volumes that were required to cover all of the fruit and you would find an orange that was immature on one side and mature on the other.  So you might have a tinge of green on one side of a piece of fruit and a creasing on the other side.

Q...... Did Mr Barrett say that the golf ball size was the time to apply it.

A...... Yes.

Q...... Can you remember whether he was questioned by anyone after his statement about the recommended 20 ppm, was he questioned by anyone about that.  Can you remember any discussion taking place about that.

A...... There certainly was discussion.

Q...... Do you know who said what.

A...... Our grower liaison guy at that stage was Peter Barry and he is also a grower, and his interest from the pack houses perspective and his own perspective with his own plantings was pretty fierce I suppose.  So that he questioned him quite a bit across the room.  We were all sitting around in a U shaped format and Mr Barrett was standing up on the side of the top of the U and Peter Barry was on the other side; the opposite side to Mr Barrett, and there was quite a lot of discussion with respect to rates and volumes of water and ground speed, all of those sorts of things that affect the actual volume of water or chemical that gets on the orange.

Q...... Were those discussions between any particular people.  I know that, I suspect you can’t remember people in the crowd;  but apart from Mr Barry do you remember whether they were between him and Mr Barrett or between him and other people and Mr Barrrett.

A...... There was pretty general discussion and Greg Moulds who was there and is a horticultural adviser - he was in Waikerie working down there for the department - he had some knowledge about application rates and had done some trials, I think with GA’s.

Q...... Do you remember whether he spoke at the meeting about his trials.

A...... I can recall that Mr Moulds was certainly involved in t he discussion, but I’m not sure that he actually got up and addressed the meeting as such.  But he was certainly involved in the discussion, no doubt about that.

Q...... Can you remember him saying anything about recommended 20 ppm for control of creasing.

A...... Only general discussion I think.  With respect to what Abbott, Abbott’s man was talking about, Mr Barrett was talking about.  And I don’t recall that there was any huge variation from what was being recommended.  I mean, Mr Moulds didn’t say you should not be doing that or that’s not right or whatever.

QBut you can’t remember him actually saying anything about the rate as such.

A...... Certainly he was involved in the discussion with Peter Barry and Mike Barrett about ground speeds and the volume and all those sorts of things.

Q...... Did you take interest or note when Mr Barrett said it should be used at the rate of 20 ppm.

ACertainly was interested.  But, I mean, I was primarily interested in my growers putting this GA fruit on their tree so it would increase the pack house was my prime motivation.

Q...... Do you remember whether Mr Barrett had said anything distinguishing between the use of ProGibb on navels generally and Lanes in particular.

A...... Making a differential?

Q...... Yes

A...... No, I don’t.

Q...... Do you recall something like that, if he said it.

OBJECTION               Mr Lovell objects.

HIS HONOUR

Q...... If it was suggested to you that Mr Barrett made this up for distinction, in the discussion, Do you say it’s right or wrong, or he might have done it, or you don’t remember.  Which of those three answers, or any other answer.

A...... I don’t recall he made any delineation between Washingtons and Lanes;  it was a navel recommendation.

XN

Q...... If its suggested to you that Mr Barrett specifically distinguished between the use of 20 ppm on navels generally, as distinct from Lanes in particular, do you recall whether that happened, or are we confusing you.

A...... You are a bit.  The recommendation, from my recollection, the twenty ppm for navels.”

28     In cross-examination John Simpson said that he does not remember Mr Moulds making a presentation to or formally addressing the meeting but Mr Moulds did engage in the “across table” discussions between those who were present and, as he remembers, Mr Moulds distributed a “flyer” something like Exhibit D24.

29     Unlike D24B, D24 does not expressly set out the application of GA to be twenty ppm for creasing - it recommends for that purpose GA application rates of 1,000 - 1,500 millilitres per hectare in water volumes of 5,000 - 7,500 litres per hectare.  I think it is more likely than not that D24 is the document handed out at the meeting on 3rd December, 1992 and it is the document referred to as the “circular” which Mrs Simpson wrote should be disregarded when sending D24A to growers.  D24A states that to reduce creasing GA “should be applied using a concentration of 20 ppm”.

30     John Simpson was unsure whether D24 was a copy of that which was distributed by Mr Moulds at the meeting .

(p1290)

"Q.... Having had a look at that document, does that refresh your memory as to whether or not Mr Moulds may have talked a bit more about application rates and works that he was involved in.

A...... No, it doesn’t particularly, but what does make a lot of sense to me, because he makes reference to the US navel exports at the top.  As I said earlier in the piece, the directive from the River Sun Board was application of GA for people who wanted to send their fruit to US, which is totally in accord with what was going on at the time.

Q...... What I suggest to you happened at the meeting was that Mr Moulds was talking about his trials and his work, and was telling the growers about the fact that 20- parts per million had been applied during the course of this work,.  Do you remember that.

A...... I can certainly recall the 20 parts per million being promulgated by Mr Barrett and I would have thought it would have been a natural extension that Mr Moulds would have commented on that, if he was unhappy about that, I would have thought he would have made a noise about it at the time.  I would have thought.”

(p1292-1296)   

“Q.... Is this the position.  You have no recollection of Mr Moulds giving a formal talk about the use of gibberellic acid at 20 parts per million.

A...... No, I don’t.

Q...... I suggest to you that is what happened.

A...... Well, it’s possible, but I don’t recollect that.

Q...... I suggest to you that Mr Barrett at no stage recommended the use of gibberellic acid at 20 parts per million  on oranges.

A...... I can’t agree with that, I’m sorry.

Q...... Do you remember whether your brother Ian asked any questions at the meeting.

A...... Yes, he did ask questions.

Q...... Do you remember that specifically, or are you just assuming that he -

A...... No, I can recollect that he was up the other end of the table.  I think, as I described earlier, there was a U-shaped table arrangement.  I can tell you where the people were, with respect to where Mr Barrett was and the associated people he had with him where my brother was and where Mr Moulds was and where Peter Barry was.

Q...... Were you aware Mr Barry was taking notes at the meeting.

A...... Certainly.

Q...... Have you seen those notes of his.

A...... Not for some time, but obviously he was in our employ at the time, so they formed part of our newsletters that would have gone out following that meeting.  In the ensuing months we normally send the newsletter every month,

Q...... Newsletter about what.

A...... Anything that’s topical at the time.

Q...... So would there be subsequent newsletters about what occurred at the meeting in December ’92.

A...... There would have been that meeting announcement in the newsletter.  I can’t honestly tell you whether there was any newsletter following that, that had specifics about the meeting, other than perhaps - I don’t know to be honest with you.

Q...... Are those newsletters kept.

A...... Yes, they are.

Q...... Where would they be.

A...... We would either have them at home, or they would be down here in evidence somewhere.

Q...... They are not in evidence but they can be produced from the packing shed somewhere, can they.

A...... There’s a black book full of newsletters.

MR LOVELL CALLS FOR PRODUCTION OF NEWSLETTERS FROM NOVEMBER  ’92 TO MARCH ’93.

...

Q...... Can we get back to the question I was asking you;  during the course of the meeting, I suggest that Ian specifically asked a question of Mr Barry (sic) about the use of ProGibb on Lanes.

A...... If I can specifically remember -

Q...... I am suggesting it happened.  I am asking for your comment on that.

A...... On whether he asked or -

Q...... Whether you can remember if he asked.

A...... I can’t remember.

Q...... Is it possible he did.

A...... Yes.

Q...... Did Mr Barrett reply that, as they didn’t have them in the US, that he didn’t know much about them and he had little or no experience with Lanes.

A...... No, I don’t remember that.

Q...... Could it have happened.

A...... I don’t believe so.

Q...... Do you remember discussions by Mr Moulds about application rates at the meeting and the use of pH buffering.  Does that refresh your memory about Mr Moulds.

A...... No, it doesn’t.  Certainly all those things would have been discussed to the application of the pH.  It was a very important aspect of correct application.  I can’t recall that specifically but I certainly agree that it would be entirely possible that would have been discussed at the meeting.

Q...... Do you remember someone, and I can’t be more specific, talking about not mixing gibberellic acid with any other type of spray.

A...... Yes, that’s a normal practice.

Q...... I appreciate it’s the normal practice.  Do you remember that being discussed at the meeting.

A...... I can’t say I specifically do, no.

Q...... Do you remember whether it was Mr Moulds who talked about the timing of the spray, to prevent the creasing or the albedo breakdown.

A...... The timing of the creasing was discussed.  I can’t say who specifically introduced the subject.”

31     Ian Simpson recalled that John addressed the meeting on 3/12/92; 

(p.89-92)

"Q.... Can you remember what John said.

A...... He was -

Q...... Just in general terms

A...... Yes, I think ’92 was our first year that we’d been into the States on this export set-up and John was - because we had had this huge problem with Albedo, was trying to get over to the growers the out-turn problems that we had had in that particular year.

Q...... So can you remember how long he spoke for along those lines.

A...... No, not offhand.

Q...... Can you remember who else spoke at the meeting.

A...... I can remember Mike Barrett.

Q...... Yes, anyone else.

A...... I think Greg Mr Moulds did.

Q...... Who is Greg Mr Moulds.

A...... Greg Moulds at that stage worked for the South Australian Government as an Ag adviser based in Waikerie.

Q...... Can you remember how long he spoke and how long Mr Barrett spoke.

A...... No I can’t.

Q...... Can you remember whether anything was handed out at the meeting.

A...... There was some fliers that came out on rates and -

Q...... Look at P2 and P3 and tell us whether you recall whether they were handed out at that meeting.

A...... Yes, I believe they were.

Q...... To all the people present.

A...... Yes.

Q...... Now in particular I want you to tell his Honour in your own words, but representing the effect of what Mr Barrett said at the meeting about gibberellic acid, about Albedo, about anything else that he spoke, can you take that in stages, can you give us your version of what you remember him saying.

A...... Mike Barrett informed us at the meeting that we could solve our problems by using ProGibb GA at 20 ppm -

Q...... Do you remember him saying those words.

A...... Yes. He also again stressed the buffering of the water and to be between that 4 and 5.

Q...... The Ph.

A...... Ph, sorry, yes.

Q...... Anything else he said on that occasion about - or did he say anything about when to apply the GA

A...... Yes, the GA had to be applied at golf ball size.

Q...... Did you know what he meant by that.

A...... Yes.

Q...... Had he mentioned that to you on any previous occasions, that is the golf ball size.

A...... Yes, we had talked about it because I can remember, again it was paramount that we have coverage of the fruitlets and golf ball size was the size apparently that was easy to cover.

Q...... Was this a meeting where people spoke formally, and by that I mean without interruption, or was it a question and answer meeting or was it a bit of each.

A...... I think at the end of both John’s and Mike’s talks it was open for questions.

Q...... Were there questions.

A...... I can’t remember, I imagine so.

Q...... You think there were but you can’t remember any particular topics.

A...... No.

Q...... I think you also heard Mr Lovell say this morning that at that meeting, which he said Mr Barrett attended with two others from Abbott’s, can you remember anyone else from Abbott’s being there at that meeting.

A...... Sorry, can you repeat that one?

Q...... Mr Lovell when he was outlining the defendant’s case to his Honour this morning said there were two other people who he named - the name doesn’t come to me at the moment, but two other people present at Abbott’s at that meeting, can you remember them.

A...... Yes I can.  I had met Gordon Childs and Frank Gallucio previously, yes, I had met them previously.

Q...... Were they there.

A...... I believe so.

Q...... Do you remember them saying anything.

A...... I don’t think so, no.  No, Mike did the talking as far as I can remember.

Q...... Do you remember Mr Lovell also telling his Honour that Mr Barrett will say, firstly that he didn’t say anything about the use of 20 ppm - you disagree with that from what you have said, and that Mr Moulds said that, do you remember him saying that.

A...... No, not offhand, no.

Q...... So, what did you decide to do as a result of hearing what Mr Barrett said on that occasion.

A...... Well, this seemed to be the answer from the gods to us to fix our problem and we were hellbent on spraying everything to try to have a better product, to supply to the pack house, to supply the market.

Q...... Did you instruct Mr Lowe to carry out any spraying.

A...... Yes we did.  I told him what to spray and etc, yes.

Q...... What rate did you tell him to spray at.

A...... 20 ppm.

Q...... Did you tell him when to spray.

A...... Yes.

Q...... When did you tell him to spray.

A...... Golf ball size.

Q...... Were you present when he sprayed.

A...... I don’t think.

Q...... Do you remember approximately in an average year when golf ball size time would be.

A...... It would be somewhere late January/February.

Q...... Did you enquire from Mr Lowe at any stage whether in fact he had sprayed, did he tell you.

A...... Yes, we talk all the time.

Q...... Now just going back to the meeting, did Mr Barrett say, or did anyone else ask whether there was any differentiation between different types of Navels for the application of the rate of 20 ppm, be it Washington’s, Lanes or any other variety, was there any discussion about varieties.

A...... I can’t remember, no.”

32     He was taxed in cross-examination concerning his discussion with Mr Barrett in the latter part of 1992 and what occurred at the meeting on 3/12/92.

(280-284)

"Q.... “I think you gave evidence that it was during the course of a conversation at the packing shed that Mr Barrett suggested a particular rate of using GA.

A...... Yes.

Q...... I suggest he never said that to you, the 20 ppm, at the packing shed.

A...... He did.

Q...... Did you mention to him at the packing shed how the eight rows had gone.

A...... I can’t remember.

Q...... Did he make some enquiry.

A...... I can’t remember.

Q...... With Lanes we have heard some evidence about what is known about golf ball size fruit;  when would Lanes achieve a golf ball size fruit generally.

A...... In general terms it would be late January/February.

Q...... What about Washingtons.

A...... Similar sort of time frame.

Q...... The Lanes are harvested later than Washingtons;  you have already told us that, is that correct.

A...... Yes.

Q...... Do the Washingtons just mature from the golf ball size quicker.

A...... There’s not a lot of difference in the size of the fruit that early in the season, between Washingtons and Lanes.

Q...... Can we then turn to the meeting at the golf club:  who spoke at the meeting.

A...... My brother John.

Q...... Nothing to do with GA I presume from John.

A...... No.

Q...... What did Mr Barrett say at the meeting.

A...... Mr Barrett also spoke at that meeting.

Q...... What did he say.

A...... He was recommending to fix the problem of creasing we could spray GA at 20 ppm.

Q...... Was Mr Moulds there.

A...... I think he was, yes,

Q...... He spoke didn’t he.

A...... I can’t remember him speaking but he may have.

Q...... He recommended did he not that gibberellic acid be sprayed at 20 ppm.

A...... As I said I can’t remember him speaking.

Q...... You have no recollection.

A...... No.

Q...... You know Mr Moulds don’t you.

A...... I do, yes.

Q...... Do you ever remember speaking to him or him speaking to you about gibberellic acid at any time.

A...... We have, yes.

Q...... Mr Moulds worked for the government didn’t he.

A...... Yes.

Q...... Department of Agriculture.

A...... Yes.

Q...... Pre the meeting in December 1992 had you spoken to Mr Moulds about the use of gibberellic acid.

A...... Not that I can remember.

Q...... What about since;  have you spoken to him since that meeting.

A...... Yes.

Q...... When did you speak to him.

A...... I can’t remember.

Q...... In ’93.

A...... It could well have been, yes.

Q...... In the December ’92 meeting was there material handed out.

A...... Yes.

Q...... From the Department of Agriculture.

A...... I can’t remember any handouts from the ag department.

Q...... Do you say that couldn’t have happened or it may have happened -

A...... I said I can’t remember.

Q...... What I suggest happened at that meeting in December ’92 is that Mr Moulds was the one who stood up and spoke about gibberellic acid to prevent creasing, do you disagree with that.

A...... I just said, I can’t remember him speaking.

Q...... And that Mr Moulds was the one who recommended that gibberellic acid, ProGibb, be sprayed at 20 ppm.

A...... I cannot remember Greg Mr Moulds speaking at that meeting.

Q...... At no stage did Mr Barrett recommend, and I use that word deliberately, recommend ProGibb when sprayed at 20 ppm.

A...... He did.

Q...... Did he say that to the entire meeting.

A...... Yes.

Q...... Did he repeat that to you after the meeting or anything like that.

A...... I cannot remember those conversations.

Q...... Why didn’t you go out and spray eight rows.

A...... The 1992 crop was a very, very bad year for creasing and we didn’t want to repeat that.  The impression we came away with from that meeting was this you beaut product could fix the problem, and we were convinced that that was the way to go.

Q...... When you say we.

A...... I was convinced.

Q...... How many growers were there.

A...... There would’ve been 20 or 30 there.

Q...... Do you know of any others that were so convinced, they ran out and sprayed ProGibb on their navels.

A...... I think there was quite a few that sprayed.

Q...... At 20 ppm.

A...... I believe that’s the case.

Q...... Are you aware that other people at the meeting have sprayed their navel oranges.

A...... Yes.

Q...... Have there been to your knowledge growers who have complained about subsequent problems with their navel oranges as a result of this product.

A...... I believe were the only ones to spray Lanes Late.

Q...... Why do you say that.

A...... I don’t think any other growers have got Lanes Late.

Q...... Did you have any problems with your Washington navels after you sprayed them in March of - whenever you sprayed them after the meeting in February.

A...... No, we did not have any problems.

Q...... None at all.

A...... No.

Q...... Absolutely sure about that.

A...... Yes.

Q...... There couldn’t be any doubt about that.

A...... Not to my knowledge.

Q...... Because if you’d had problems with your Washington navels they’d form part of this claim I would presume.

A...... I hadn’t even thought about it, they weren’t a problem.

Q...... Do you remember whether had any problems with the flower set on the Washington navels in 1993.

A...... The crops were good, there wasn’t a problem.  I can’t specifically remember the flowering of them, no.

Q...... If that had been a problem, you’d remember that, wouldn’t you.

A...... I would think so.

HIS HONOUR

QDid you spray the Washingtons at 20 ppm.

A...... Yes.”

He said (327) he does not remember Mr Moulds speaking at the meeting on 3rd December, 1992;  there was a lengthy adjournment of his cross-examination.  When it resumed it was put to him that Mr Moulds at the meeting on 3rd December, 1992 spoke about applying GA at 20 ppm - he said (at 1361) he could not remember Mr Moulds speaking about that and he could not remember “whether Mr Moulds was at that meeting.  You are talking 7 years ago”.  That response and the frequency with which Ian Simpson on several topics said he could not remember what he had seen, done or heard leaves me to be cautious about some aspects of his evidence.  However, concerning the conversations he said he had with Mr Barrett before the meeting on 3 December, 1992, John Simpson also gave evidence to the same effect - that Mr Barrett on the day of but before the meeting said that “we should spray our Lane navels with 20 parts per million” (1848)

33     Mr Barry’s evidence is that he made a note of some of the topics which were spoken of or discussed at the meeting on 3rd December, 1992 - he made his note on the back of a copy of Exhibit P2 which he obtained at the meeting.  He was cross-examined about his note;  it is exhibit D44.

34     Mr Barry said that there were thirty-four persons present among whom were growers whose names he listed in his note, three persons from Abbott’s, one of whom was Mr Barrett, John and Ian Simpson, Mr Lowe and himself.  He said John Simpson spoke, “introduced then handed over to Greg Moulds”

(902-908)

"A..... “Well basically Greg Moulds started off with explaining that to use the GA, gibberellic acid, that we had to buy a pH meter to test the quality of water and then adjust that pH with adding a buffing agent, which is called Primabuff or Superbuff, and then he went on to say about there was no need for wetter because obviously the Primabuff was a wetter in itself, and also commented that it can burn the fruit, the base of the fruit.  Basically he also spoke about copper and GA, which shouldn’t be mixed together because it could be detrimental to the fruit, and then just gave  us a 10-12 day cycle I suppose between applying the sprays and then suggested perhaps using the GA first and then the copper because the GA would probably go on a bit earlier than the copper.  Do you want me to continue on?

Q...... Yes. What was the next thing you recalled about the meeting.

A...... Well then basically Mike Barrett was asked to speak on behalf of the chemical company on their particular product and how it does effect rind quality and whatever, and he explained in detail about how it was formulated - I presume in the States - and how it actually works on the fruit, to give growers an insight on what the product will do and how it will delay the maturity of citrus.  He basically said it had to be 100% coverage, and I do make reference to that point because as a contractor for seven years I used to use it and I     always used to think that we only had to put it on at about 5-600,000 l/ha and I used to think it was systemic and it would just translocate through the tree and help the rind quality of the fruit, but after this meeting with him he said it had to be 100% coverage, in other words it was a contact product and you had to saturate the whole fruit and around the fruit to make the product work, so I’ve obviously changed my thinking after seven years.  That’s why we went up to rates of 9.000 l/ha rather than the lower rates.

Q...... Did Mr Barrett say that as well.

A...... Yes.

Q...... What else did he say.

A...... Basically then he just recommended applying it for two reasons, one is for rind quality which is if you use a late spray that will just delay the maturity of the fruit and it would be still quite solid when we’re ready to pick it later in the season.

Q...... Did he say when.

A...... Yes, generally two weeks prior to colour break, as is written there, early April, at those rates, 10 ml/100 1, and then we spoke about the problems of albedo which is probably the primary reason why we were there, to control that as well, and that was recommended that it be at 20 ml/100 1 as per my notes and to be done in January, February.

HIS HONOUR

Q...... What does your note say.

A...... Recommended 20 ml/100 1 in late January and February, and obviously the reason why it was done then at golf ball size is because we are aiming to get total saturation of the fruit and by doing it earlier we are able to get the product around the whole fruit.

XN

Q...... Was golf ball size actually stated, or is that something - by using your notes, can you say to his Honour whether golf ball size was actually stated.

A...... It was.  Generally everybody says golf ball size, which gives everybody an indication about what size it should be, for people that play golf.

Q...... What else was said in relation to the use of the product at the rate of 20 ml/100 1.  What else was said.

A...... Just basically that the fruit will hold - well obviously you wouldn’t want to do the two sprays, so growers had to make a decision whether they were trying to get rind quality;  if they have a problem with albedo, then to do the earlier spray at the higher rates.

Q...... Did anyone say why you couldn’t do two sprays.

A...... Well I don’t think - it’s just one of those things that you - it only warrants one spray a year basically.

Q...... By using your notes you’ve said that you can recall what Mr Barrett said, and you’ve given his Honour the details of the rates and the coverage and the time at which the product should be applied.  Can you recall whether it was Mr Barrett who dealt with either, or both or neither, the two different areas, namely the 10 ml/100  for the colour break application as compared with the 20 ml/100 1 for the golf ball size application.

A...... Just looking through my notes, generally the top section of the notes and the bottom section of the notes are general about what we should be doing with our citrus.  In the centre section with Mike Barrett - spoke about was generally just related to the product and the product alone, so those notes generally just refer to the product. 

Q...... So you think that’s what Mr Barrett said.

A...... - was speaking on the product and how to activate it or how it’s used.

Q...... You’ve referred to the parts of your notes.  The top part you’ve already read out to his Honour - you’ve given the narrative to his Honour - and then you’ve drawn a line on your notes.

A...... Yes.

Q...... Underneath that you’ve then got two sections with a line drawn between them and underneath them.  Is that the part you’re referred to about the product.

A...... Yes.

Q...... Then underneath that you’ve got another section.

A...... Yes.

Q...... Can you now tell us about that and what you remember about that.

A...... The bottom section, there’s a lot of generalisations there of what was said.

Q...... Tell us what they are, the generalisations, in other words translate your notes.

A...... Basically Greg Moulds has said something about the calcium levels to stop creasing because growers wanted to know why we were getting this creasing problems;  whether it was weedicides that we were using and whether it was a problem in older trees, younger trees.   My experience with growing apples is that we apply calcium to trees to stop a problem called bitter pip, so there was questions about whether there was a lacking in something in the tree or in the fruit itself.  So Greg Mr Moulds made comment that there is low calcium levels, but it’s very hard to try and get calcium into the tree, to try and get the tree to take up calcium to build up the cell structure of the orange.

Q...... What else did he say.

A...... In regards to that?

Q...... Yes.

A...... Well, basically, the only other way of doing it is protecting the GA sprays.

Q...... What else did he say in the meeting at that point, or did someone else say something.

A...... No, generally after that it was all Greg Moulds commenting about why we’ve got this problem of creasing.

Q...... Just tell us what you can tell us from your notes Greg Moulds said about those things.

A...... Well, basically as the notes said, the first eight weeks of development is the most important, development of the fruit, so from when - the development of fruit is around about October, so he was sort of suggesting even that you may want to try and get trace elements into the trees to try and built up the calcium levels and whatever.  Then he also suggested if that failed, not so much failed but it is a problem trying to get trace elements - as it says here, ‘Perhaps put GA sprays as this will stop albedo and hold fruit late’ you can pick the  fruit late which gives the fruit time to size up.

Q...... What else.

A...... Then it also adds that if we’re going to keep fruit late we’d obviously try to hold the fruit on the trees and we’d use Cit-tite which stops the fruit from dropping.  I did make a note there because I obviously I had my own fruit properties, is that Mike Barrett had said something in regards to some trials or something they had done up in Yandilla Park.

Q...... Do you remember by reference to your notes what he said.

A...... Yes, basically that they’ve sprayed GA on some Washington navels and kept them late as possible into September and because the rind quality was so good they were able to sell them on the market at the premium time, and basically they’d be sold as Late Lanes or presumed as Late Lanes because the quality of the fruit was so good.  So I made a note of that because firstly with my own fruit properties, I thought if I could do that and achieve that then my returns would be probably twice as much as what they would be in the middle of the season.

Q...... What about the rest of your notes, do you remember what anyone said.

A...... No, I just made other notes about rates of copper.  Some growers may have asked some questions there because obviously I’ve written down, ‘Copper, 5 kg to 2000 litres not 4’.  It seems to infer that someone has asked a question about rates, or questioned the rates, so I’ve written down five - that’s what Greg Moulds has said is recommended and not four, which perhaps someone had suggested that they were putting on 4 kg.

Q...... What did you understand the copper was for.

A...... Copper is for septoria spot and other diseases that we are required to protect against.

Q...... But that’s not related to albedo.

A...... No.

Q...... You’ve been through the names and you’ve told us that you wrote all the people down that were present.  I presume that was because of your work as liaison officer.

A...... Yes.

Q...... You wanted to know who was there.

A...... Yes.

Q...... Then there’s some notes on the side of the page, can you tell his Honour where they fit into the scheme of things for the meeting - on the right side of the page.

A...... Yes, I’m looking at that now - obviously after Mike Barrett speaking in regards to total coverage, 100% coverage and whatever, and his explanation of product of GA, it was suggested that it may have been by Ian Simpson or Greg Moulds, I’m not sure, that we should perhaps spray both ways in the citrus orchards to try and ensure that we got 100% coverage on the trees.

Q...... So do you think that note is in relation to a question asked by someone, you say maybe Ian Simpson.

A...... Yes.

Q...... Were there questions and answers as the speakers were speaking or did they say what they wanted to say and the questions and answers then followed that.

A...... No, generally  the first part of the meeting, like with Greg Moulds, he basically spoke about the first section.

Q...... Just stopping you there, how long did he speak for roughly, I know it’s hard to try and to do that now, but just roughly.

A...... I’d be guessing, 15 minutes or something like that, I don’t know.

Q...... Perhaps we’ll do it this way - you were just about to say ‘and then Mike Barrett spoke’.

A...... Yes.

Q...... Did he speak for a shorter or a longer time than Greg Moulds.

A...... Probably about the same.  I found that Mike was very interesting because he actually talked about how the product was manufactured through some insects and whatever, and it was quite an interesting topic that he raised, and then no questions were sort of asked.  He was just letting everybody know how it was formulated and how it worked on the trees, the fruit.

Q...... Then the latter part which you have been referring to which I think you said was Mr Moulds again, was that shorter or longer than the initial -

A...... That was generally just question time on the bottom section.  He did most of the answers on that because that was a lot of more general questions about copper and other things that growers want to know.”

Mr Barry estimated the meeting took up about two hours.  He said he did not have any Lanes Late on his properties, but after the meeting he sprayed GA at the rate of 20 ppm on his Washington navels which he said reduced the albedo breakdown.

35     In cross-examination he said, in reference to the circular P10, which he on behalf of Simpson Packing sent to growers inviting them to the meeting on 3rd December, 1992, that although that document does not refer to creasing, “that was predominantly the reason why we were” at the meeting.

36     The note Exhibit D44 made by Mr Barry is broadly divided into four sections each separated by a line.  Mr Barry said that the second and third section concerned the timing and application rates of GA;  the second section at a rate of 10 ppm for “rind quality”;  the third section at a rate of 20 ppm for “albedo”.  He was questioned about his notes.

(912-916)

"Q.... “What you’ve done is - at the invitation of Mr Anderson, is that you have reconstructed, from the structure of your notes, what you think related to Mr Moulds and what relates to Mr Barrett.

A...... No, I do remember the conversation - or basically the talk that Mike Barrett made in regards to the product of GA and how it is manufactured, I do remember that.

Q...... Is that referred to in your notes, the talk about gibberellic acid and I think you referred to how it’s made and insects and things like that.  Is that in your notes at all.

A...... Well it’s not, because the reason is, I only made the notes so that I could put this in a newsletter to sent out to growers later on.

Q...... I’m not being critical of you Mr Barry.

A...... No, I know, but I’m just explaining that’s why we wouldn’t have written that down.

Q...... But you can remember, independently, can’t you, because it was an interesting talk that Mr Barrett gave, about how gibberellic acid was manufactured.

A...... Yes.

Q...... And you didn’t record that, because whilst it was interesting, it was essential information for you to pass on.

A...... No, it was not, no.

Q...... So this is the position, that you cannot, other than by reconstructing from your notes, say who said what at that meeting.

A...... I beg to differ that, I can remember Greg Moulds talking about those particular items and -

Q...... When you look at your notes, you have gone about a third of the way down the page and then you’ve drawn a line across.

A...... Yes.

Q...... When Mr Anderson was asking you questions, you got to that third of the way down and you stopped and said that was the end of what Mr Moulds had been talking about, at that stage.  Is that correct, do you remember giving that evidence this morning.

A...... A third?  I don’t know, I don’t think I said that.

Q...... Well the first line that you’ve drawn.

A...... Yes.

Q...... I call that a third of the way.

A...... All right, yes.

Q...... Okay and you refreshed you memory from those notes and you got down to there and then you said, ‘Then Mr Barrett took over’, or words to that effect.

A...... Yes.

Q...... Is that correct.

A...... Yes.

Q...... Then you referred to what Mr Barrett said and is there not another line, drawn across the page, a bit over halfway down, that in just under the words, ‘rates’, ’10 ml per 100 litres of GA’.

A...... Yes.

Q...... Why did you draw the line across there.

A...... Because it’s relative to two different timings of the spray, one is for rind quality, which is sprayed later and with the albedo, which is an earlier spray, which is a different spray, is relative to that third paragraph, what’s why there’s a differentiation between the two.

Q...... Do you agree with this, that the passage that you’ve looked at in your notes, from about a third of the way down, includes more than that doesn’t it, it talks about not mixing GA with any other spray, do not apply to trees under stress, things of that nature.

A...... Yes.

Q...... Does that line, the second line that I’ve indicated, indicated to you that Mr Barrett stopped talking at that stage, after having recommended a rate of 10 ml per 100 litres and that Mr Moulds took over when it came to albedo.

A...... No, I honestly can’t say that, no.

Q...... You can’t say it’s not right either, can you.

A...... No.

Q...... It may have been the position, that having recommended 10 ml per 100 litres of GA, that Mr Moulds resumed the discussion and talked about albedo and control.      

A...... The reason why that section was there, was because it was talking about identifying the actual product and what that was going to do, that’s why I actually sectioned that section off.

Q...... But that doesn’t mean that Mr Barrett was talking about it, does it, from your notes, it could have been Mr Moulds.

A...... I can’t say for sure, I don’t know to be honest with you, because I’ve started the next lot of notes, I’ve referred to Greg Mr Moulds as him saying that in the bottom section, so I presume that Greg then spoke again on the second section of those notes.

Q...... I’m not being critical of you Mr Barrett, but you’re really just trying to reconstruct who said what, without any real memory, independent of these notes.

A...... I obviously know what happened at the meeting, by looking at the notes and I’m explaining that to you.

Q...... And I’m not having a problem with that, but we’re just trying to - you’ve refreshed your memory from these notes, but what I’m suggesting to you is the notes don’t really help you to say who said what and you don’t really -

A...... Well I tend to disagree with that, because they do, because the notes are referring to general criteria at the top and the bottom, which is what Greg Mr Moulds is basically an adviser, on advising a lot of things, whereas the centre section is relative to the product itself and that’s when Mike Barrett spoke on that.

Q...... It may be that Mr Moulds spoke about albedo creasing and recommended the 20 ml per 100 litres, that’s correct isn’t it.

A...... He has been known to have recommended those rates as well, yes.

Q...... But that may be what your note is referred to, that is Mr Moulds’ talk.

A...... I can’t honestly say that yes or no.

Q...... You can’t say whether it was Mr Barrett or Mr Moulds, but one of them said it.

A...... Yes.

Q...... Or I suppose or possible both, is that what you’re -

A...... Yes, because I know in the section that was referring to the product, that was one of the

......... OBJECTION               Mr Anderson objects.

......... HIS HONOUR

Q...... This is your notes made at the Loxton meeting, is that your evidence.

A...... Yes.

EXHIBIT D44    Mr Barry’s notes made at Loxton meeting tendered by Mr Lovell.       Admitted.

......... XXN

Q...... Let’s try and go back over that again.  What I’m suggesting to you is that you are not able to now remember who talked about albedo and the spraying rate of 20 ml per 100 litres.

A...... I couldn’t say that in either way to be honest with you.

Q...... What you’ve done is from your notes, thought back and said well because I drew those lines over there, it’s probably Mr Barrett.

A...... Yes.

Q...... But you can’t other than reconstructing off those notes, you can’t actually remember.

A...... No, it’s eight years ago I suppose.

Q...... What I’m suggesting to you is it was Mr Moulds who started up the conversation about albedo and the rate at 20 ml per 100 litres.

A...... No I’m not saying that either, I don’t know.

Q...... After the description about albedo, you’ve got another line across the page and is it fair to say that they’re a little bit higgledy-piggledy after that.  Would that indicate that perhaps there was some discussion and questions.

A...... Yes, question times yes.

Q...... Because there’s nothing in the rest of those notes, that is below that list line leaving aside the question of costing, that refers to rates of application of gibberellic acid.

A...... No.”

37     Mr Barry said he was aware before the meeting that Mr Moulds was investigating, or conducting trials concerning, the albedo problem by applying
GA at different rates and that at the meeting there was a set of notes like D24 available but that knowledge and the notes like D24, did not assist him to say it was Mr Moulds who talked about the albedo problem at the meeting.

38     He agreed that Ian Simpson asked a number of questions during the meeting and he may have specifically asked about the use of ProGibb on Lanes Late but he did not remember Mr Barrett responding to the effect that he did not know about, had little or no experience with, Lanes Late and there would have to be trials to determine the affect. 

39     Mr Lowe said John Simpson chaired the meeting on 3rd December, 1992, spoke for a while and then Mr Barrett “gave an address”.  Mr Lowe said “I definitely remember (Mr Barrett) talking about 20 ppm, which was more that we had put on before, but I’d assumed that it was for another reason because it wasn’t what we’d applied it for last time”.  He does not remember Mr Moulds being at or speaking at the meeting.  Tested in cross-examination Mr Lowe could not remember anything else of substance concerning the meeting other than that Mr Barrett ,who spoke for about 20 minutes, said that applying GA at 20 ppm could help control creasing.

40     Darrell Lang bought a property of 20 acres at Loxton North in 1987 on which he grew, among other things, Navels, Valencias and Lanes Late, the latter on approximately  one acre.  He worked for the Department of Agriculture between 1981 and 1991 which included a post as the manager of the Loxton Research Centre;  his duties in that or a previous role included advising industry on spray technology.  He has formal qualifications in horticulture.  In 1991 he obtained a post as a lecturer in horticulture.  He said that he met Mr Barrett when he (Mr Lang) worked at the Department of Agriculture and was a member of an advisory team in the Riverland region;  it was in the course if disseminating information on growing citrus that he came to know Mr Barrett.  He said he attended a field day which was organised by Mr Barrett to look specifically at the use of GA which Mr Barrett had been working with concerning rind  maturity and specifically “the albedo problem”.

41     Mr Lang said that at the meeting on 3rd December, 1992 copies of Exhibits P2 and P3 were handed out and also something like D24.  He said John Simpson opened the meeting, spoke about the “out-turn” of navels in that season for the US market and the purpose of the meeting and then introduced Mr Barrett and Mr Moulds.  He said Mr Moulds spoke first upon “looking to try and improve the whole situation with the albedo problem” and then Mr Barrett spoke “primarily referring to timing, rates and quite a bit of discussion surrounding technique as well ...  He suggested that in terms of trying to prevent albedo that we go to a much earlier timing and that we look to use a higher rate of GA”, 20 ppm, instead of 10 ppm, and  when the fruit was at golf ball size in late January early February.  Mr Lang said he had previously used ProGibb applying it two weeks prior to colour break (in April or May) at 10 ppm to navels and 20 ppm to grapefruit;  the suggestion that it be applied to navels at 20 ppm Mr Lang said was “new” to him.  He said that additional cost was a topic at the meeting.

(876)

"Q.... “Is there anything that you can remember Mr Barrett saying at that meeting, other than what you’ve told us so far about rates, application - I’m not suggesting there is, I’m just asking whether there is anything else you can remember.

A...... Well, certainly Mike was sensitive to our concerns as far as cost of imposing these treatments and so he was acutely aware I would suggest, to the fact that you know we were talking a fairly significant outlay and particularly with increasing rates.  I think that he did make reference to that and indicated that the returns were likely to far exceed additional expenses associated with the treatment.

Q...... Were there any discussions in relation to how much it would cost per tree.

A...... I can’t give you the exact figures, but yes, yes.

Q...... Do you recall whether that was something that Mr Barrett said or someone else said or someone else asked.

A...... Yes, there was a lot of discussion surrounding that and as I recall I would suggest that both Greg Mould and Mike addressed that issue, as did the growers.”

He said that after the meeting he continued to apply ProGibb at the rate he had previously used it - 10 ppm - and not on his Lanes Late.

42     In cross-examination he said that D24A was not handed out at the meeting.  Concerning the trials of gibberellic acid on navels which he spoke of in examination he said those were being run by Mr Moulds “in conjunction with Mike Barrett”, Mr Moulds’ part revolving “around ensuring that there were sites available and growers who were happy to participate”.  In the discussions he said he had on occasions with Mr Barrett in relation to the trials on occasions before the meeting on 3rd December, 1992 they “did not specifically talk about rates” of application.  He was taxed about who at the meeting spoke concerning application rates.

(881-882)

"Q.... “We’ll just take it one step at a time.  Mr Moulds stood up and I suggest that he was talking about the trials that had been conducted.

A...... Yes.

Q...... He was saying that they were trials, they were experiental.

A...... They had been, yes.

Q...... He was the one at the meeting talking about rates at 20 ppm.  First of all, was he speaking about the rate at 20 ppm.

A...... Yes, both people spoke about the rates.

Q...... We’ll come to Mr Barrett in a moment.  What we’re talking about is whether Mr Moulds was at that meeting talking about rates applied to navel oranges at 20 ppm.

A...... Yes.

Q...... He was.

A...... Yes.

Q...... He was talking about that in conjunction with work that had been going on in these trials, whoever had been responsible.

A...... Yes.

Q...... I suggest that Mr Moulds was a person who talked about, not only the rates, but also the volume of spray that was to be used.

A...... Yes.

Q...... The timing as well of the application.

A...... Yes.

Q...... He was talking about all those things.

A...... Yes, that’s correct.

Q...... I suggest to you that Mr Barrett did not recommend to the meeting rates at 20 ppm.

A...... On the contrary he did.”

He said he remembered Mr Moulds recommending spraying navels with GA at 20 ppm and stating the trials at Waikerie had been reasonably successful in reducing creasing.  He was asked:

(884-885)

"Q.... “Well, I presume Mr Barrett didn’t get up and repeat exactly the same thing.

A...... I’m not sure that I would agree with that.

Q...... So he just got up and said all the same things that Mr Moulds did.

A...... Yes, I would say so.

Q...... Did Mr Moulds talk about altering the pH of the water.

A...... Yes, that was an integral part of the process.

Q...... What was your understanding of what they were talking about, what Mr Moulds was talking about.

A...... Sorry, you asked me two things then.  They or he?

Q...... No, Mr Moulds.

A...... Thank you.  There was reference made to buffering the solution to get optimum performance.

Q...... Do you remember what rates were being talked about on the pH.

A...... In terms of a pH level?

Q...... Yes.

A...... To be quite honest no, I would only be guessing, in terms of what was referred to on that occasion, yes, and also too it involved buffering the solution which had an indicator in it, so that it automatically buffered it to a level.”

He said he did not remember Ian Simpson, specifically, ask any questions.

(886)

"Q.... “Do you remember Mr Simpson specifically asking about the use of this product, gibberellic acid, on Lanes Late. 

A...... Just navels, and so in answer to your question, no.

Q...... But that may have happened.

A...... Yes.

Q...... And what I suggest is that he did ask such a question and that Mr Barrett responded about the fact that he had little or no experience with Lanes Late.

A...... Mike Barrett said that?

Q...... Yes, I said Mr Barrett didn’t I.

A...... Yes, Yes, Yes, Yes, no, no.

Q...... That may have happened.

A...... Yes.

Q...... And that Mr Barrett said that because he had no experience with Lanes Late there would have to be some long term testing of the product.

A...... No, I don’t recall that being the case.

Q...... It may have been said or are you saying it  wasn’t.

A...... I certainly don’t recall that being the case.”

(886-887)

"R..... “Prior to that meeting had you had any discussion with Mr Barrett about label rates.

A...... About rates, yes.

Q...... And about the fact that anyone who used the product outside of the label rates was doing so at their own risk, or words to that effect.

A...... No.

Q...... And I suggest that something like that was said at the meeting at  Loxton.

A      No, I certainly don’t recall that.

Q...... Once again are you saying it definitely wasn’t said or it may have been said -

A...... No, no, it definitely - well there were no  riders placed on the recommendations from that point of view.”

43     Mr Lang rejected that Mr Barrett at the meeting did not “recommend” the use of GA at 20 ppm on any navels.  In response to the proposition that Mr Barrett specifically said no work had been done concerning Late Lanes, he said he was unsure “about the Lanes and reference to the Lanes specifically”. 

44     Mr Gallucio joined the defendant in 1991 as a technical sales representative specifically in table grapes, stone fruit and vegetables.  He said Mr Barrett is an American who has been employed by the defendant in different positions in various countries;  in Australia Mr Barrett held the position of Product Manager.  He said he and Mr Barrett together made trips to the Sunraysia and Riverland districts.  He attended the meeting on 3rd December, 1992 to learn more about citrus to which, he said, he had not had much exposure.  He said Mr Barrett, at the meeting, made a presentation concerning ProGibb;  the major topics he could recall were the background of the defendant, what it made, what GA is and “the actual coverage aspect of ProGibb and talking about our slide presentation, what is on our label”.  He went on -

(1734)

"Q.... “You mentioned the topic of  coverage rates.  What was talked about by Mr Barrett in relation to that, at that meeting.

A...... Coverage rates, that would have been at least 7,000 litres of water to the hectare.

Q...... Do you have a specific recollection or is that something you now know.

A...... That’s something that I sort of recollect vaguely.  It’s a volume that’s also in the presentation.

Q...... Was the topic of application rates of gibberellic acid discussed by Mr Barrett.

The defendant urged that, on the latter part of that note, the Court should conclude that the cost of freighting Millewa fruit to the market should be deducted from the losses claimed by Simpson Packing.  However I am satisfied from the evidence of Mr Lewis that the price per tonne, used by the plaintiffs in their submission concerning the 80’s Lanes Late in the years 1994-1998 inclusive was after allowing for that cost.  I infer in the absence of any evidence to the contrary that the price per tonne in the years 1994 and 1995 derived from the Yandilla Park information concerning Lanes Late was also net after the deduction of freight.

207   I therefore assess Simpson Packing loss of a packing and juicing fee (less its direct costs) in the sum of $67,513.  It was submitted that Simpson Packing failed to take reasonable steps to obtain fruit from other sources to make up in whole or in part the reduction in tonnes of fruit from Millewa and so mitigate its potential loss.  I accept John Simpson’s evidence, for the reasons he gave, that such a course was not available.

The Navelina Development

208   I have referred to the plaintiff’s business plan - that is the final claim made by the plaintiff which is that the low yield crops in 1994-1998 inclusive so reduced their income that they were “financially unable to implement a business plan drawn in May 1997 to develop 55 acres of citrus on the Millewa property” requiring the planting of 15,400 Navelina orange trees and 910 Verna lemon trees;  it is alleged that as a consequence of the losses caused by the reduced Lanes Late crops that development was deferred for two years until late in 1998 when 16,950 Navelina orange trees were planted.

209   When the Millewa land was acquired in the late 1970’s it comprised about one hundred and sixty acres, approximately one half of which was freehold and the balance leasehold.  As I understand Ian Simpson’s evidence the leasehold land was that in the southern or south-eastern segment of the aerial photograph P7;  at one time it had been earmarked as part of the proposed Chowilla Dam.  The plaintiffs understood, I think, when they took up the land that the leasehold would likely become available for purchase and in the early 1990’s Ian Simpson opened up negotiations with the controlling authority which had a number of changes of name and which for brevity, although inexactly I will refer to as the Water Authority, a description used by the parties.  The plaintiffs had a mind to develop the land - initially it was grapes, but that was abandoned in favour of citrus, specifically Navelina oranges which would fill a gap between the harvesting of two other citrus varieties.  This plan involved a number of steps which were either foreseen or eventuated -

·.. successful negotiations for the purchase for the leasehold land

·.. the acquisition of a right to take more water from the adjacent Murray River

·.. placing an order with the Yandilla Park nursery for the propagation of the required number of Navelina orange trees

·.. the planning of an irrigation system the installation of which (as I understood) required approval of the relevant authority and as part of which a soil survey had to be carried of so much of the land as had not been previously planted - of the sixty acres proposed to be developed only some twenty four acres had been previously planted

·.. obtaining a permit authorising the removal of native vegetation in order to clear the land

·.. the closure of a two chain road

210   Ian Simpson was emphatic in his evidence that no development would be commenced until a freehold title had been obtained.

211   In a request in February 1994 by Mr Lewis, on the plaintiffs’ behalf, to the then State Bank of South Australia for finance for the purchase and development of the leasehold land the plaintiffs contemplated the purchase price of the land would be $75,000- $100,000, an additional water licence would cost $25,000 - $50,000 and the establishment of a vineyard $350,000 - $400,000, a total of about $500,000;  the application proposed that there would be “a principal and interest holiday” for the first three years.  The application was not approved.  David Simpson said the proposal to plant grape vines was only “flirted” with, a “whim”.

212   Also in February 1994 Ian Simpson offered $38,571 to purchase the Millewa leasehold land and, at a meeting of directors in December 1994, he reported he had reached an agreement at a price of $90,000 - $45,000 for the land and $45,000 for the water licence.  In fact, no such agreement had been reached.  However in April 1995 a request was made to the Commonwealth Development Bank for a funding facility (including $210,000 long term, to meet $55,000 “recently expended on the acquisition of additional water licences at Millewa”, $110,000 “recently expended ... on alterations to the packing shed and packing shed plant” and $45,000 on freeholding the Millewa land an expenditure likely to be incurred in the next two months”).  A facility of $210,000 was approved on 12th May, 1995, but no agreement was reached concerning the purchase of the Millewa land until January 1996 when the plaintiffs accepted the Water Authority’s offer of $92,000 made in December 1995;  that effective doubling of the price estimated for the land in the application made in April 1995 appears to have been a matter of embarrassment to Mr Lewis (Exhibit P47 p.125) - an application for a further loan of $92,000 was approved by the Commonwealth Development Bank in June 1996 to pay for and obtain a transfer of the Millewa land.

213   By March 1995 it appears the plaintiffs were confident they would be successful in purchasing the leasehold land, although the price was not finally agreed upon until January 1996;  they took the step on  24th March, 1995 of entering into an agreement with the Yandilla Park nursery for 13,645 Navelina trees and 2274 Washington navels to be budded and grown for delivery in October 1996 for a total of $111,433.  The agreement is Exhibit P11 which provides for progressive instalment payments at intervals before and at the time of delivery. This was part of a different project for the development of the Millewa land - oranges instead of grapes - which Ian Simpson estimated would cost $344,000 (P47 p.58).

214   The agreement for the purchase of the Millewa land (P47 p.100) included conditions requiring the consent of four named authorities concerning the development of the new plantings.

215   Settlement of the Millewa land purchase occurred in June 1996.  In that month the plaintiffs obtained from Yandilla Park Services a management plan for the irrigation and drainage of the development and they sent to the Sunraysia River Water Authority a copy of the plans for the redevelopment noting “The proposed timing of the redevelopment is March 1997”.

216   In October 1996 the plaintiffs were granted a permit to clear native vegetation from the land to be developed;  it was subject, inter alia, to the plaintiffs submitting a soil survey by a soil scientist identifying “the areas that are suitable and unsuitable for the proposed horticultural development”.

217   Sometime prior to November 1996 the plaintiff approached the Commonwealth Development Bank to provide finance of $290,000 for the Millewa Navelina development and to additionally take over the existing advances from Bank SA to the plaintiffs.  That application was the subject of an investigation and a report dated 28th November, 1996 by the bank (P47 p.149 which includes at page 164 how the sum of $290,000 is made up).  On 27th November, 1996 the Simpson brothers, other than Robert, met with Mr Lewis.  A Minute of that meeting was made (Exhibit P47 p. 165).  The Minute includes the topic of the application to the Commonwealth Development Bank, during the discussion of which Mr Ross Ford of that Bank was present, he is recorded to have said “It might be best if he look (sic) solely at this stage at approving $290,000 and not the taking over of all of the bank debt.  The loan has to be approved in Sydney”.  I note that an internal Commonwealth Development Bank document dated 17th September, 1998 (Exhibit P47 p. 259) records that the plaintiffs

“... approached us during November 1996 to obtain development finance of $290,000 as they intended to plant up an area of about 22.0Ha on their Millewa property (Vic).  It was recommended that we approve this additional finance and role both of the CDB loans into one.  The loan was not subsequently proceeded with .”

Concerning that directors’ meeting which Mr Ford attended, Mr Lewis said he believed the application for a loan of $290,000 was not approved although he could not remember why it was not approved.  The internal CDB document dated 17th September, 1998 states that approval of that loan was recommended, but the loan was not proceeded with.

218   In 1996 the plaintiffs learned that Ramco, a major supplier of fruit to Simpson Packing under a three year contract, would not be supplying fruit after the first year.  This severely impacted upon, inter alia, the plaintiffs’ budget for 1997 (Transcript 1209 ff, Exhibit P47 pages 169 and 185) and the plaintiffs approached Bank SA in January 1997 for an increase in their overdraft accommodation.

219   In May 1997 the plaintiffs’ application for a new irrigation development on the land at Millewa purchased in June 1996 was approved (Exhibit D22).  Ian Simpson was questioned at some length whether, and to what extent (aside from any funding difficulties), the Navelina development at Millewa could have proceeded before the receipt of the irrigation permit in May 1997 and also the impact upon any development of a delay in obtaining a survey concerning the closing of Government roads within the area of land purchased in June 1996.  The relevant evidence is at pages 946-963.  He explained that of the sixty acres, or thereabouts, of the land purchased in June 1996 to be planted with the Navelina orange trees, approximately twenty-four acres of it could have been planted without the need to obtain a new irrigation development approval.  He also said that if the plaintiffs had had, or been readily able to raise, the funds necessary for the development he would have been more vigorous in pressing the relevant authorities for an earlier decision concerning that part of the sixty acres for which an appropriate approval or consent was required, although from his experience with those or other authorities he implied that obtaining approvals is a protracted process.

220   I find that it is unlikely the plaintiffs would have proceeded with the Navelina development other than as a single project, that it was never contemplated it would proceed piecemeal and until around about May 1997 when the consent was obtained the development would not have been embarked upon.

221   Having received the consent to a new irrigation development, the plaintiffs were still obliged to obtain a survey to satisfy a condition of the approval to clear native vegetation which required provision for secure access to portion of the Government road reserve and the River Murray reserve (Exhibit D21).  On 22nd September, 1997 the Department of Natural Resources and Environment responded to the plaintiffs’ solicitors concerning a proposal for an access road.  The Department required a survey which;  in turn necessitated the preparation of a plan of subdivision so that the proposed road could be transferred to the Crown, and until that occurred any native vegetation clearance was prohibited (P47 pages 215-217).  The survey was not carried out until in October 1997 and I infer the transfer to the Crown of the proposed road occurred some time thereafter.

222   Ian Simpson said he could have planted part of the Millewa property with Navelina trees notwithstanding the delay in agreeing the site of the proposed road.  That was perhaps possible but in my view entirely unlikely;  not only was the project to be carried out as a single development as I find, but at some time, probably in 1996 the plaintiffs agreed with Yandilla Park that the delivery of Navelina trees which had been nominated for October 1996 be deferred until some later time;  Yandilla Park sold to another the, or some of the trees, which had been earmarked for the plaintiff. 

223   I reject the plaintiffs’ submission that absent the losses caused by the consequences of the GA applied in February 1993 the Millewa development could have proceeded in 1996.  I find that irrespective of the plaintiffs’ lower income as a consequence of the reduced Lanes Late crops the development could not have been completed until, at the earliest, in October or November of 1997.  In the event the plaintiffs on 14th September, 1998 secured from the CBA funding of $235,000 to finance the Millewa development and in November/December 1998 the Navelina trees were planted.

224   The defendant submits that the plaintiff not being able, in any event, to commence the Millewa development until in 1997 they were practically prevented from proceeding until October 1998 because of the timing of the various steps necessary to prepare the land to receive the Navelina trees.  Normally citrus trees are planted in about October (transcript 1155).   

225   The programme for development contemplated in June 1996 when the plaintiffs submitted their plan to the Sunraysia River Water Authority, called for the development to occur in March 1997.  However the approval of the new irrigation development was not given until May 1997.  That delay may account for the comment in the Commonwealth Development document (Exhibit P47 p.259) that the loan of $210,000 was not proceeded with.  But, be that as it may, I find that the plaintiffs would not have proceeded with the development before irrigation approval was obtained in May 1997 by which time, as I further find, not only was it likely too late to set about doing what was required to complete the development in 1997, there were also the other unresolved matters concerning native vegetation and the transfer of land to the Crown for road access to Government reserves;  these latter matters were not finalised until about October/November 1997.  I therefore conclude that, for reasons unrelated to any financial difficulties the plaintiffs would not have been able to establish the Navelina development until October 1998 which is  when the development was completed.  The plaintiffs’ claim under this head must be dismissed.

226   If I am wrong in concluding that the plaintiffs implementation  of the Navelina development was not affected by the reduced receipts attributable to the low crop yields, and in truth there would or may have been an opportunity to implement it in October 1997 but for the reduced receipts, then damages for that lost opportunity are to be assessed “by reference to the probabilities or possibilities of ... what would have happened” whether the deprivation of the opportunity occurred by reason of tort or breach of S.52(1)  of the Trade Practices Act.  Poseidon Ltd v Adelaide Petroleum NL (1994) ALJR 313 at 320.

227   Ian Simpson said that, but for the financial difficulties caused by the severe reductions in crop yields, he would have agitated for the earlier granting of approvals and accelerated reaching agreement concerning the road access to Government reserves;  if successful in achieving those things the Navelina development, he said, could have been embarked on and completed in October 1997.

228   The loss of production in 1994 to 1998 inclusive caused as I have assessed a reduction in the plaintiffs’ combined receipts. 

229   The defendant submits those receipts would have been taxable in the hands of the plaintiffs.

230   Those losses which were incurred in the year 1998, cannot figure in identifying the plaintiffs’ financial ability to embark on the Navelina development in 1997.  Therefore at the time in 1997 when the plaintiffs might otherwise have begun the development the combined receipts, as a consequence of the 1993 events, were reduced by the aggregate of the years 1994-1997 inclusive , that is $165,000 approximately.

231   The defendant submits that the sum of any receipts which it is assessed the plaintiffs would have received but for the reduced Lanes Late production  must necessarily be reduced by tax at 36% which would have paid thereon and only the balance would have been available to the plaintiffs to commit to the Millewa development, or alternatively swell their net worth in relation to their borrowing capacity.

232   The submission depends to some extent upon, firstly the ability of the plaintiffs as part of the Simpson Group to lawfully minimise a liability to tax by steps described  by Mr Lewis when he gave evidence concerning the management accounts, and secondly whether or not the plaintiffs, or either of them, would have made a loss in the particular year even if the “lost” receipts were notionally factored back into their respective accounts.  As to the former Mr Lewis gave evidence (T.1718/1719) concerning the effective tax rate; at one point he spoke of (as I calculate) a rate of approximately 24%, and at another about 36% - the reason for the difference is not clearly explained.  As to the latter it does not seem to me that there were otherwise such losses that no tax would have been payable on the receipts.  I therefore proceed on the basis that tax at the rate of 36% would have been paid, so reducing to $105,600 the amount the plaintiffs may have had available but for the consequences of the application of GA in 1993.  That sum is substantially less than what was required to commence the Navelina development in 1997 and complete it by October 1997;  it would still have been necessary for the plaintiffs to have borrowed the difference.

233   The defendant further submits that notwithstanding the loss of income attributable to the GA application in February 1993, if the Court finds such a loss occurred, the plaintiffs’ own records demonstrate that since the early 1990’s they had been unable to properly control their expenditure , were frequently exceeding the budgeted outgoings and failing to achieve their budgeted receipts on the basis of which accommodation  from bankers had been obtained or continued, so that the plaintiffs were obliged to request an increase in their overdrafts. This occurred in December 1992, June 1993 and February 1994 and before any of the claimed GA-caused losses occurred (Exhibit D15-D19);  it appears that a, but not the only, matter of concern to the bank was the level of the drawings by the Messrs. Simpson.  It is submitted any receipts from Lanes Late would have been appropriated to the plaintiffs’ other needs for funds and the Navelina development would not have proceeded in 1997.

234   Mr Lewis said that the moneys which would have been received, but for the lost crops, would have “greatly assisted” the plaintiffs to carry out the Navelina development;  “If they had the funds available, in my view, they would have undertaken the development most likely - I can’t say categorically they would have undertaken the development.  That’s a matter, I believe, for Ian Simpson and John to make that judgment” (T1698).  It is clear, in my view, that Ian Simpson in particular was committed to bringing about the Navelina development.

235   Were the Navelinas to have been planted in approximately October 1997, there would have been no crop taken off until the financial year 1999/2000 when the yield is estimated at 61 tonnes rising to 1852 tonnes in 2005/2006.  In the plaintiffs’ business plan, Exhibit P12 prepared in May 1997, the price per tonne was estimated at $500.  The plaintiffs claim the achievable  price is $1180 per tonne, the average price paid to growers who supplied Navelinas to Yandilla Park’s pack house in 1998 and 1999 (Exhibit P66)

236   On the assumptions, first, that newly planted Navelinas would come into production in year three and production would progressively rise to year nine then remain steady, and second that the price for the fruit in each year would be $1100 per tonne, Mr Lewis prepared a calculation (Exhibit P84) to show the present value at 7% of an income stream the commencement of which is deferred for two years, i.e. on the plaintiffs’ case, the Navelinas would have been planted in October 1996 but for the financial loss arising from the GA application in February 1993.  On that basis the figure is $509,939.  Mr Lewis recalculated his figures on the assumption the Navelina plantings were delayed by one year, not two;  on that assumption the figure is $263,637 (T.1690).

237   The first calculation for the purposes of the business plan had assumed a Navelina price of $500 per tonne;  Mr Lewis prepared his present value calculation at that price, (assuming a two year deferral) and then at $800 per tonne and then, as I have said, at $1100 per tonne.  The prices of $500 and $800 per tonne were estimates which had been made by John Simpson.  At T.1690 Mr Lewis said that were the deferral to be only one year then at $500 per tonne the figure is $103,000 and at $800 per tonne $179,459.

238   There is little doubt, on the evidence, that the price obtained on the sale of citrus varies from year to year and the variation can be considerable.  In my opinion $1100 per tonne constant for ten years cannot be supported.  Even if $800 per tonne might be appropriate, then as this case shows climatic and other vagaries can significantly and adversely affect crop yields, and the figure of $179,459 has to be heavily discounted, in my view to $140,000.

239   Bringing to account the several matters bearing on the claim concerning the Navelina development namely:-

·.. whether the plaintiff would been obliged, or would have chosen, to apply to “lost” receipts not to the Millewa development but to some other purpose

·.. the financial impact of Ramco not supplying any further fruit

·.. the quantum of the plaintiffs’ borrowings from bankers even if reduced by the “lost” receipts and whether sufficient further funds could have been borrowed to meeting the development costs

·.. the likelihood the plaintiffs could have overcome or sufficiently reduced the delays in obtaining approvals and consents or reaching agreement concerning roads to permit the development to proceed to completion in October 1997

in my opinion damages for the plaintiffs’ loss of opportunity would be a small fraction of the benefit which the plaintiffs might have received if the development had proceeded in 1997 instead of 1998.  The matters I have enumerated are substantial contingencies weighing against the plaintiffs being able to have proceeded in 1997 and derive the income they claim has been deferred.  An assessment cannot be other than a broad approach.  I would judge, on the evidence, the possibility that the plaintiffs may have been able to position themselves to have proceeded in 1997 at about 15%.  Therefore the damages under this head would have been $20,000.

240   However for the reasons I have given the plaintiffs are not entitled to any award for this claimed loss.

241   There will be judgment against the defendant for the plaintiff Simcit in the sum of $177,319 and the plaintiff Simpson Packing in the sum of $67,513.  In my view interest calculated at 6% would be appropriate.  I award interest to Simcit in the lump sum of $47,600 and to Simpson Packing in the lump sum of $17,600.  The aggregate is for Simcit $224,919 and for Simpson Packing $85,113.

242   I will hear counsel on the question of costs.