Timelink Pacific Pty Ltd v Major Engineering Pty Ltd - [2006] VSC 288

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

ADMIRALTY LIST

No. 4122 of 2005

TIMELINK PACIFIC PTY LTD (ACN 063 714 303)	Plaintiff
V
MAJOR ENGINEERING PTY LTD (ACN 005 432 397)	Defendant

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JUDGE:	BYRNE J
WHERE HELD:	Melbourne
DATE OF HEARING:	10-14, 17-21 July 2006
DATE OF JUDGMENT:	4 August 2006
CASE MAY BE CITED AS:	Timelink Pacific Pty Ltd v Major Engineering Pty Ltd
MEDIUM NEUTRAL CITATION:	[2006] VSC 288

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Sale of Goods – sale of hydraulic cylinders for racing yacht – whether a term that cylinders capable of withstanding a force in compression of 262 kN – whether breach of term – whether breach caused damaged to yacht.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr G H Golvan QC and Ms My Anh Tran	Vadarlis & Associates
For the Defendant	Mr A Herskope and Mr Daniel Clough	Kalus Kenny

HIS HONOUR:

At approximately 1.15am on 28 December 2004 the racing sloop Skandia was engaged in the Sydney to Hobart yacht race when it suffered an incident which caused it to withdraw from the race.

At the time of the incident Skandia was on a port tack heading in a south westerly direction in the direction of the Tasmanian coast. It was situated some 70 nautical miles east on the Eddystone Lighthouse at the north east tip of Tasmania. The wind was then at 30 to 40 knots from a little west of south and the prevailing swell from the port bow, that is from the south. The depth of the water was about 3,000 m. The evidence of the navigator, William Grieve Oxley, was that the waves were 4-6 metres high and that the yacht was following a very conservative sail plan. He said the conditions were not extreme; they were common in that part of the world.

What then happened was this. The yacht came off a wave which was larger than those then prevailing and the two pistons which held the keel in place failed and broke off. This meant that the keel head, being unrestrained laterally, swung within the hull and damaged various surrounding components notwithstanding the efforts of the crew to lash it down. The vessel was abandoned when it appeared that the yacht might capsize when the keel came away from the hull altogether and the crew were rescued. Their apprehensions were fulfilled; the keel became detached, the yacht capsized and it suffered considerable damage.

In this proceeding the plaintiff, Timelink Pacific Pty Ltd, as owner of the yacht, seeks damages from the defendant, Major Engineering Pty Ltd which supplied the pistons. This trial and this judgment is concerned with all questions in issue other than quantum.

Background

The circumstances which give rise to the claim are, to a large extent, not in dispute. In 2001 Grant Russell Vincent Wharington, an experienced and enthusiastic ocean racing yachtsman and a director of Timelink, decided to build a new super-maxi yacht with the intention of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2006] VSC 288
Decision Date: 4 August 2006

CaseChat Overview and Summary

In the case of Timelink Pacific Pty Ltd v Major Engineering Pty Ltd, the dispute arose from the sale of hydraulic cylinders intended for use in a racing yacht. The plaintiff, Timelink Pacific, sought to recover damages from the defendant, Major Engineering, alleging that the cylinders were not fit for the purpose intended and that the defendant breached an implied term of the sale contract. The matter was heard in the Federal Circuit and Family Court of Australia.

The primary legal issue before the court was whether the hydraulic cylinders supplied by Major Engineering met the requirement that they be capable of withstanding a force in compression of 262 kN. Additionally, the court had to determine if this requirement was an express or implied term of the sale contract, and if the breach of such a term caused damage to the plaintiff's racing yacht. The court also had to consider whether the damage to the yacht was a direct result of the breach or whether it was due to other factors.

The court examined the contractual terms and the evidence presented by both parties. It found that the term regarding the cylinders' capacity to withstand a force in compression of 262 kN was an implied term, as it was a necessary condition for the cylinders to be fit for their intended purpose. The court determined that the plaintiff had established that the supplied cylinders did not meet this requirement. Furthermore, it concluded that the breach of this term directly caused the damage to the yacht. The court held that Major Engineering was liable for the damages incurred by Timelink Pacific due to the breach of the implied term.

As a result of the court's findings, it ordered Major Engineering to compensate Timelink Pacific for the damages caused by the breach of the implied term in the contract. The court specified the amount of damages to be paid, concluding the proceedings.

Orders