Welch v Hanlon Trading Ltd (1570357) - [2015] QSC 75

SUPREME COURT OF QUEENSLAND

CITATION:

Welch v Hanlon Trading Ltd (1570357) [2015] QSC 75

PARTIES:

ROGER THOMAS WELCH

(plaintiff)

v

HANLON TRADING LIMITED (1570357)

(defendant)

FILE NO/S:

BS1035/14

DIVISION:

Trial

PROCEEDING:

Application

DELIVERED ON:

16 April 2015

DELIVERED AT:

Brisbane

HEARING DATE:

13 October 2014

JUDGE:

Jackson J

ORDER:

The order of the court is that the separate questions and their answers are as follows:

In relation to the written contract between the plaintiff and the defendant dated 11 July 2013 for the sale of the vessel ‘Allegro’:

1.        Is it a requirement of the conducting of any ‘Pre-Purchase Inspection or Survey Report’ by the Buyer under Special Condition 4(1) that both of the following need to be identified:

(i)      the ‘agreed defects’; and

(ii)     the cost of fixing, and in the alternative diminution in value of the vessel brought about by, the ‘agreed defects’?

Answer: No

2.        If the answer to question 1 is ‘no’, is it a requirement of the conducting of any ‘Pre-Purchase Inspection or Survey Report’ by the Buyer under Special Condition 4(1) that it identify the ‘agreed defects’ within the meaning of that expression as it is used in Special Condition 4(2) or 4(3)?

Answer: No

3.        If the answer to questions (1) and (2) are both ‘no’, are the ‘agreed defects’ within the meaning of that expression as it is used in Special Condition 4(2) or 4(3) those defects which:

(i)      have been identified in or as a result of the Pre-Purchase Inspection or Survey report; and

(ii)     the Seller and Buyer have between them mutually agreed are a defect for the purposes of Special Condition 4(2) or 4(3)?

Answer: Yes

4.        Is it a requirement for the operation of Special Condition 4(2) that the Seller and Buyer agree that the costs of rectifying the ‘agreed defects’ are less than $5,000?

Answer: No

5.        Is it a requirement for the operation of Special Condition 4(3) that the Buyer and Seller agree that the costs of rectifying the ‘agreed defects’ are more than $5,000?

Answer: No

6.        Does the word ‘settlement’ as it appears in Special Condition 4(4) mean:

(i)         the settlement referred to in par 4(3)(b) of the Special Conditions; or

(ii)        the settlement of the contract?

Answer: the settlement referred to in par 4(3)(b) of the Special Conditions.

CATCHWORDS:

CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – CONSTRUCTION AND INTERPRETATION OF CONTRACTS – INTERPRETATION OF MISCELLANEOUS CONTRACTS AND OTHER MATTERS – where the parties contracted for the sale of a luxury sailing yacht – where the parties disagreed on the operation of the Pre-Purchase Inspection Special Conditions of the contract – where the parties sought a determination of separate questions by the Court – where the Court applies a businesslike interpretation for commercial contracts

Baldwin v Icon Energy Ltd [2015] QSC 12, applied
Electricity Generation Corp v Woodside Energy Ltd (2014) 251 CLR 640; [2014] HCA 7, applied
UI International P/L v Interworks Architects P/L & Ors [2008] 2 Qd R 158;

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.

Keep reading for free

Create a free CaseChat account to read Welch v Hanlon Trading Ltd (1570357) and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2015] QSC 75
Decision Date: 16 April 2015

CaseChat Overview and Summary

The matter before the court was a dispute between Welch, the plaintiff, and Hanlon Trading Ltd, the defendant, regarding the sale of a luxury sailing yacht, 'Allegro'. The disagreement centred on the interpretation of the Pre-Purchase Inspection Special Conditions within the contract for the sale of the vessel. The court was tasked with determining several specific questions related to these special conditions, which both parties had sought clarification on. The central issue before the court was the interpretation of the contract terms, particularly those concerning the 'agreed defects' and the costs associated with rectifying these defects. The court was required to determine whether certain conditions needed to be met for the operation of the pre-purchase inspection, including the identification of specific defects and their costs, and whether there was a requirement for the buyer and seller to agree on the cost of rectifying the defects.

The court approached the interpretation of the contract using a businesslike approach, as befits a commercial contract. It found that the term 'agreed defects' referred to those defects identified during the pre-purchase inspection or survey report, which the buyer and seller mutually agreed upon as defects. The court clarified that neither the identification of the defects nor the costs of rectifying them needed to be explicitly stated in the pre-purchase inspection report for the special conditions to apply. Additionally, the court ruled that the term 'settlement' in Special Condition 4(4) referred to the settlement mentioned in paragraph 4(3)(b) of the special conditions, not the settlement of the contract itself.

The court's final determination was that the 'agreed defects' were those identified during the pre-purchase inspection or survey report and mutually agreed upon by the buyer and seller. The court also concluded that there was no requirement for the buyer and seller to agree on the costs of rectifying the defects for the special conditions to operate. The court's interpretation provided clarity on the obligations of the parties under the contract and resolved the specific questions posed by the parties.

Orders

Orders of the court

The order of the court is that the separate questions and their answers are as follows:

In relation to the written contract between the plaintiff and the defendant dated 11 July 2013 for the sale of the vessel ‘Allegro’:

1. Is it a requirement of the conducting of any ‘Pre-Purchase Inspection or Survey Report’ by the Buyer under Special Condition 4(1) that both of the following need to be identified:

(i) the ‘agreed defects’; and

(ii) the cost of fixing, and in the alternative diminution in value of the vessel brought about by, the ‘agreed defects’?

Answer: No

2. If the answer to question 1 is ‘no’, is it a requirement of the conducting of any ‘Pre-Purchase Inspection or Survey Report’ by the Buyer under Special Condition 4(1) that it identify the ‘agreed defects’ within the meaning of that expression as it is used in Special Condition 4(2) or 4(3)?

Answer: No

3. If the answer to questions (1) and (2) are both ‘no’, are the ‘agreed defects’ within the meaning of that expression as it is used in Special Condition 4(2) or 4(3) those defects which:

(i) have been identified in or as a result of the Pre-Purchase Inspection or Survey report; and

(ii) the Seller and Buyer have between them mutually agreed are a defect for the purposes of Special Condition 4(2) or 4(3)?

Answer: Yes

4. Is it a requirement for the operation of Special Condition 4(2) that the Seller and Buyer agree that the costs of rectifying the ‘agreed defects’ are less than $5,000?

Answer: No

5. Is it a requirement for the operation of Special Condition 4(3) that the Buyer and Seller agree that the costs of rectifying the ‘agreed defects’ are more than $5,000?

Answer: No

6. Does the word ‘settlement’ as it appears in Special Condition 4(4) mean:

(i) the settlement referred to in par 4(3)(b) of the Special Conditions; or

(ii) the settlement of the contract?

Answer: the settlement referred to in par 4(3)(b) of the Special Conditions.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	Welch v Hanlon Trading Ltd (1570357) [2015] QSC 75
PARTIES:	ROGER THOMAS WELCH (plaintiff) v HANLON TRADING LIMITED (1570357) (defendant)
FILE NO/S:	BS1035/14
DIVISION:	Trial
PROCEEDING:	Application
DELIVERED ON:	16 April 2015
DELIVERED AT:	Brisbane
HEARING DATE:	13 October 2014
JUDGE:	Jackson J
ORDER:	The order of the court is that the separate questions and their answers are as follows: In relation to the written contract between the plaintiff and the defendant dated 11 July 2013 for the sale of the vessel ‘Allegro’: 1. Is it a requirement of the conducting of any ‘Pre-Purchase Inspection or Survey Report’ by the Buyer under Special Condition 4(1) that both of the following need to be identified: (i) the ‘agreed defects’; and (ii) the cost of fixing, and in the alternative diminution in value of the vessel brought about by, the ‘agreed defects’? Answer: No 2. If the answer to question 1 is ‘no’, is it a requirement of the conducting of any ‘Pre-Purchase Inspection or Survey Report’ by the Buyer under Special Condition 4(1) that it identify the ‘agreed defects’ within the meaning of that expression as it is used in Special Condition 4(2) or 4(3)? Answer: No 3. If the answer to questions (1) and (2) are both ‘no’, are the ‘agreed defects’ within the meaning of that expression as it is used in Special Condition 4(2) or 4(3) those defects which: (i) have been identified in or as a result of the Pre-Purchase Inspection or Survey report; and (ii) the Seller and Buyer have between them mutually agreed are a defect for the purposes of Special Condition 4(2) or 4(3)? Answer: Yes 4. Is it a requirement for the operation of Special Condition 4(2) that the Seller and Buyer agree that the costs of rectifying the ‘agreed defects’ are less than $5,000? Answer: No 5. Is it a requirement for the operation of Special Condition 4(3) that the Buyer and Seller agree that the costs of rectifying the ‘agreed defects’ are more than $5,000? Answer: No 6. Does the word ‘settlement’ as it appears in Special Condition 4(4) mean: (i) the settlement referred to in par 4(3)(b) of the Special Conditions; or (ii) the settlement of the contract? Answer: the settlement referred to in par 4(3)(b) of the Special Conditions.
CATCHWORDS:	CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – CONSTRUCTION AND INTERPRETATION OF CONTRACTS – INTERPRETATION OF MISCELLANEOUS CONTRACTS AND OTHER MATTERS – where the parties contracted for the sale of a luxury sailing yacht – where the parties disagreed on the operation of the Pre-Purchase Inspection Special Conditions of the contract – where the parties sought a determination of separate questions by the Court – where the Court applies a businesslike interpretation for commercial contracts Baldwin v Icon Energy Ltd [2015] QSC 12, applied Electricity Generation Corp v Woodside Energy Ltd (2014) 251 CLR 640; [2014] HCA 7, applied UI International P/L v Interworks Architects P/L & Ors [2008] 2 Qd R 158;