Solar Home Australia Pty Ltd v New Movers (Aust) Pty Ltd - [2014] QCAT 650

CITATION:

Solar Home Australia Pty Ltd v New Movers (Aust) Pty Ltd [2014] QCAT 650

PARTIES:	Solar Home Australia Pty Ltd t/as Solar Home Australia (Applicant)
v
New Movers (Aust) Pty Ltd (Respondent)

APPLICATION NUMBER:

MCDO50644-14

MATTER TYPE:

Other minor civil dispute matters

HEARING DATE:

23 September 2014

HEARD AT:

Brisbane

DECISION OF:

Adjudicator Bertelsen

DELIVERED ON:

11 December 2014

DELIVERED AT:

Brisbane

ORDERS MADE:

1. The application is dismissed.

CATCHWORDS:

Contract – terms regarding delay and representatives authority – parties willingness to perform – inability to perform consequent upon other parties conduct – ending of contract – continuity of contract – alleged repudiation of contract

APPEARANCES:

APPLICANT:

Nick Shanahan, Director

RESPONDENT:

Glen Ion, Director

REASONS FOR DECISION

Application

By application filed 27 February 2014 the applicant Solar Home Australia Pty Ltd trading as Solar Home Australia (‘Solar Home’) seeks the refund of $5,477.70 being the sum paid to the respondent New Movers (Aust) Pty Ltd (‘New Movers’) pursuant to a contract dated 1 September 2010 based on New Movers expressed intention not to perform any part of the contract.

Background and Evidence

Solar Home (‘Mr Shanahan’) and New Movers (‘Mr Ion’) entered into a contract on 1 September 2010. New Movers, a direct marketer, was to print and post 7,800 A5 coupons (or business flyers) for Solar Home an installer of solar panels. Solar Home as the advertiser or client requested to be included in the contractors New Movers program which was geographically some Brisbane areas. The commencement date was recorded as 8 November 2010 and the end date as 8 November 2011. Solar Home was granted exclusive category status for renewable energy that is to say New Movers could not enter into an agreement with any other entity in the business of renewable energy in the same geographic areas.
The contract at clause 6 provided
All artwork must be either supplied by the client in jpeg or pdf format at 300 dpi, 28 days prior to first insert/s or undertaken by the contractor as requested on the prescribed forms duly signed by client. Artwork supplied by the contractor will be sent by email or post to client for approval prior to print.
The contract went on to say at the foot of the front page ‘This contract is not subject to cancellation & advertiser acknowledges having read the terms on reverse’. That notation was initially by Mr Shanahan who was Solar Home’s signatory to the contract.
The contract terms were recited on page 2 or the reverse page of the contract.
Term 2 stated:
Late print, whether by reason of delays or other, shall not be deemed to void this contract. The contractor will however within 28 days remedy such delay and clients contracted 12 months will commence from the first insert being clients advertising.
Term 7 stated ‘No refund will be given for any unused materials’.
Term 12 stated ‘The representative is not authorised to alter/vary this contract and/or relevant forms in any way’.
It was not contentious that no artwork was ever supplied by Solar Home’s (the client).
It was not disputed that:
·New Movers emailed artwork to Solar Home on 11 October 2010 for approval and that no written response was received to that email;
·Artwork was emailed to Solar Home on 28 October 2010 and that no written response was received;
·An email was sent to Solar Home on 16 March 2011 requesting approval of artwork for print and that no response was received;
·An email was sent to Solar Home on 29 March 2011 again requesting approval of artwork for print with no response being received;
·An email was sent to Solar Home on 4 April 2011 again requesting approval of artwork for print with no response;
·To all of which no written response was received.
There was no evidence produced to the Tribunal that the artwork was substandard, defective or unprofessional in any way.
New Movers asserted it was ‘ready willing and able to fulfil the their obligations under the agreement’; that delay was caused by Solar Home’s unresponsiveness and failure to submit any artwork at all in the period 8 November 2010 to 8 November 2011.
Towards the end of 2010 there was some communication and discussion initiated by Solar Home about cancellation of the agreement but it was inconclusive.
In about December 2010 a dispute erupted with respect to the use of Solar Home’s credit card (Mr Shanahan’s credit card) being debited with the contract payment back in September 2010 with Solar Home suggesting the use of the credit card was unauthorised. The contract clearly recorded payment by credit card and the matter was not pursued by Solar Home.
On 30 August 2011 Solar Home’s then solicitors MVM Legal wrote to New Movers terminating the contract
On the basis that your failure over a period of some 10 months to perform as required under the contract is one that is classified as a fundamental breach. By your failure to perform you have fundamentally denied our client substantially the whole of the benefit that it was intended our client should obtain from the contract.
There was no indication of what exactly the failure was or if identified how it constituted a fundamental breach.
New Movers replied to MVM on 31 August 2011 setting out a short form history of the contract thus far and reiterating ‘that we are happy to go to print as soon as they approve their artwork’. According to New Movers no response was ever received.
On 29 August 2013 New Movers emailed Solar Home, apparently, according to Mr Ion, after Mr Shanahan contacted him on 28 August 2013. That email commenced with the words ‘the enclosed is a rundown of events leading up to your non-inclusion in our new mover program’. An outline of the history of the contract followed.
At point number 13 the email stated:
On the 31/08/2011 we replied, outlined all the calls, emails and correspondence and reiterated ‘we would go to print as soon as they (you) approved the artwork’. That of course would have been for the balance of the program. We can’t keep programs going overtime for people who come in late, especially when they have had 10 chances to comply.
At point number 14:
Still no response. Still no artwork ever returned. I can’t understand for the life of me why you were not in the pack from day 1 or at worst a month or 2 or 6 or 9 later … can you?
At point number 15:
You booked an exclusive category in fact one that we could have sold fairly easily at the time. We provided the program on time, we gave you every chance to participate during the time frame, put up with lies, lawyers letters and now your phone call of yesterday enquiring as to what ‘benefits you could have from whatever we are doing today?’
At point number 16:
Our programs change from time to time, as do most companies, you had a ‘ticket to ride’ on the 8/11/2010 for one year. It is not a 'flexi fare’ ticket and your non-inclusion, entirely your fault simply meant ‘a seat was empty’ to keep it all in airline parlance, you missed the flight! Despite at least 6 reminders …
A first and final letter of demand was sent from Lodestone Consultants to New Movers on 19 November 2013 asserting that New Movers was attempting to reconstrue the terms of the contract and that ‘but for your company’s stated desire not to perform its obligations, our client remains entitled to the benefits of the contract’. The demand letter referred to clauses 2 and 12 of the contract and New Movers words ‘ticket to ride … the seat was empty … you missed the flight’ asserting they expressed an intention not to perform the contract and demonstrated an attempt to vary the terms of the contract ‘such that late print by reason of delay or other voided the contract’; that ‘by expressing an unwillingness to perform, you have repudiated the contract. Our client accepts your company’s repudiation of the contract, terminates the contract and seeks the return of our client’s funds …’.
In submissions Mr Shanahan stated that about a week or so prior to Mr Ion’s email to him of 29 August 2013 he contacted their office and left a message asking someone there to contact him so he could get some work done. He stated he did not hear back within a week so he called again. He said he was informed by the woman he spoke with that she did not know anything about his account and could she get Mr Ion to contact him. Mr Shanahan said he agreed.
Mr Shanahan went on to state:
Mr Ion contacted me that day, or the next. We discussed the matter and Mr Ion told me I’d receive an email setting the detail of what was needed. The email I received in response to my contacting them to have them perform was the email of 29 August 2013 … and in which Mr Ion repudiates the contract.
According to Mr Ion’s submissions Mr Shanahan contacted him about two years later (after August 2011) and demanded a refund of money paid or that their advertisement be printed and placed in the next packs. Mr Ion submitted he refused both requests. Mr Ion submitted New Movers sent the email of 29 August 2013 to Mr Shanahan ‘outlining the history of this matter and electing to terminate the contract due to Solar Home’s repudiation of the contract’.

Conclusions

The contractual relationship between the parties came into being on 1 September 2010 when the direct marketing contract was signed. The contracts duration was for the period 8 November 2010 through 8 November 2011. It provided that compliant artwork be supplied by Solar Home prior to 8 November 2010. None ever was. It alternatively further provided that artwork be undertaken by New Movers and signed off by Solar Home for distribution. Despite preparation and submission of artwork on numerous occasions Solar Home never signed off for any artwork. Solar Home had an obligation to approve or provide artwork. It did neither.
Term 2 of the contract provided for late print to be remedied within 28 days. On any reasonable and sensible reading of that term it was clearly New Movers responsibility to remedy the delay. Here there was no delay because:
a) No compliant artwork was ever submitted or received by Solar Home; and
b) Despite preparation and submission of artwork by New Movers on numerous occasions no artwork was ever signed for by Solar Home.
Solar Home asserted term 12 as relevant though why was not clear. In any event it is obvious the term disentitling the representative to alter/vary the contract is a reference to the sales representative signing the contract on behalf of New Movers.
The Tribunal accepts New Movers evidence that in the period 8 November 2010 through 8 November 2011 New Movers kept space open for insertion of Solar Home advertising in its coupons/flyers at a time when it could easily have sold that space to others. Its willingness to comply with the contract terms was evidenced by preparation and submission of artwork. It upheld its end of the bargain. Solar Home for reasons not clear other than perhaps buyer’s remorse did not avail itself of the time and space opportunity to which it was entitled and to that extent had no one to blame but itself. The contract was in any event subject to a non-cancellation clause.
In August 2011 MVM Legal on behalf of Solar Home asserted failure to perform, fundamental breach and denial of contractual benefit. Nothing was specified detailed or articulated. It was nothing but an empty threat. However Mr Ion wrote back the next day reiterating that as soon as Solar Home approved New Movers artwork then New Movers could proceed with inclusion in the coupons/flyers. At least at that point some residual benefit could have been derived by Solar Home’s for the period September, October, November 2011. That accords with Mr Shanahan’s evidence that Mr Ion would print anything he wanted at the time and that Mr Ion told him to contact the office and that the office would take it from there. There is nothing surprising in Mr Shanahan’s recollection in that these events took place in August 2011 still well within the time frame of the contract.
In the absence of any other consideration the contract came to an end on 8 November 2011. New Movers had upheld its end of the bargain. Solar Home had not availed itself of that which New Movers had made available ie time for artwork and space for advertising. Why was unclear other than to reference Solar Home’s history of reluctance to partake of the contract ie desire to resile in November 2010, credit card episode in December 2010 and unsupported termination allegation in August 2011.
Mr Shanahan asserted that some two years later in late August 2013 (about a week prior to 29 August 2013) he contacted New Movers office which unsurprisingly knew nothing about Solar Home’s account after such a length of time. After a day or two Mr Shanahan said he discussed the matter with Mr Ion and that Mr Ion told him he, Mr Shanahan, would receive an email setting out the detail of what was needed. The email he said he received was that of 29 August 2013 in which he asserted Mr Ion repudiated the contract. Mr Ion submitted the contact by Mr Shanahan was to demand a refund of money or that their advertisement be printed and distributed. Mr Ion refused both requests. It appears common ground that the email of 29 August 2013 was sent by Mr Ion to Mr Shanahan within a day or two of the contact between the two. The context of that email accords entirely with Mr Ion’s rejection of refund and advertisement. In that email he confirms, inter alia, the end date of the contract agreement at 8 November 2011, New Movers willingness as at 31 August 2011 to still go to print for the balance of the program and confirming that every opportunity was given to participate during the one year time frame of the contract. Mr Ion’s airline ticket analogy of contract opportunity for one year may be quaint but accurately demonstrative of what took place here. It was abundantly clear, if not eloquently articulated that opportunity had passed for Solar Home and a refund was not available.
Mr Ion’s submissions/statements are precise and indicative of a far more clear and detailed recollection of all of the events in the period September 2010 through August 2013 and to that extent the Tribunal prefers his recollection of events.
Mr Shanahan’s reliance on the doctrine of repudiation some two years down the track based on a telephone conversation where the only evidence of asserted continuity of the contract was Mr Shanahan’s submission that he would receive an email from Mr Ion setting out the detail of what was needed in response to his contacting New Movers to have them perform falls far short of sufficient evidence of the continuity of a contract which on the face of it came to an end some two years prior. That’s quite apart from Mr Ion’s reply email of 29 August 2013 which was not disputed until some two and a half months later by Lodestone Consultants letter of 19 November 2013 latterly raising an argument of New Movers repudiation of the contract in the first instance and Solar Home’s acceptance of that repudiation. There was no repudiation here there was nothing to repudiate.
Mr Ion in submissions stated that New Movers had no alternative but to elect to terminate the contract as performance of New Movers obligations under the contract was dependent on the other parties cooperation; that notification of the termination was sent by email on 29 August 2013. The use of the airline ticket analogy makes it clear that time and opportunity had long since passed. Even if it were to be construed as written termination at that time New Movers was entitled to do so as it had on the Tribunal’s findings long since upheld its side of the bargain.
Solar Home submitted some case law on repudiation particularly Laurinda Pty Ltd & Ors v Capalaba Park Shopping Centre Pty Ltd.[1]
[1](1989) 166 CLR 632.
Mason CJ at [29] stated:
Based on Capalaba’s unwillingness to deliver a registrable lease to Laurinda, it seems to me that Capalaba’s intention was only to perform the contract in a manner substantially inconsistent with its obligations, such as would allow Laurinda to treat Capalaba as having repudiated the contract.
There was no evidence from Solar Home to sustain an argument that New Movers intention was only to perform the contract inconsistent with its obligations because here:
a) In reality there was no contract to repudiate after November 2011; and
b) There was glaringly insufficient evidence to establish continuity of the contract as at 29 August 2013 such as to enliven an argument for repudiation of an existing contract at that time.
The application is dismissed.