Wyzenbeek v Australasian Marine Imports Pty Ltd (No 2)
[2018] FCA 1517
•10 October 2018
FEDERAL COURT OF AUSTRALIA
Wyzenbeek v Australasian Marine Imports Pty Ltd (No 2) [2018] FCA 1517
File number: NSD 911 of 2015 Judge: DERRINGTON J Date of judgment: 10 October 2018 Catchwords: CONSUMER LAW – misleading or deceptive conduct –representations made as to ocean going capability of motor vessel inducing purchase – vessel not capable of ocean going use – representations were misleading or deceptive and the makers had no reasonable basis for making them
CONSUMER LAW – misleading or deceptive conduct – loss and damage – vessel purchased in reliance on misrepresentations as to ocean going capacity was worth the price paid – vessel depreciated over time with use – appropriate measure of damages – rule in Potts v Miller or Astonland measure
CONSUMER LAW - sale of goods – fitness for purpose – defects generating risk in the use of a vessel – not fit for purpose
DAMAGES – misrepresentation inducing acquisition of motor vessel – vessel was readily saleable – no evidence that vessel was worth less than the price paid – application of the Astonland measure would compensate for “loss” arising from extrinsic, supervening or independent causes which were unrelated to the consequences of the misrepresentation – loss not established
Legislation: Australian Securities and Investments Commission Act2001 (Cth)
Competition and Consumer Act 2010 (Cth), Sch 2, Australian Consumer Law
Evidence Act 1995 (Cth)
Fair Trading Act 1987 (Cth)
Trade Practices Act 1974 (Cth)
Cases cited: ABN AMRO Bank v Bathurst Regional Council (2014) 224 FCR 1
Agricultural Land Management Ltd v Jackson (No 2) (2014) 48 WAR 1
Apollo Shower Screens Pty Ltd v Building & Construction Industry Long Service Payments Corporation (1985) 1 NSWLR 561
Argy v Blunts & Lane Cove Real Estate Pty Ltd (1990) 26 FCR 112
Banque Commerciale SA, En Liquidation v Akhil Holdings Ltd (1990) 169 CLR 279
Barclay v English [2009] QSC 258
Bennett v Elysium Noosa Pty Ltd (in liq) (2012) 291 ALR 191
Blatch v Archer (1774) 1 Cowp 63; 98 ER 969
Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592
Chappell v Hart (1998) 195 CLR 232
Daniel v State of Western Australia (2000) 173 ALR 51
Deatons Pty Ltd v Flew (1949) 79 CLR 370
Doyle v Olby (Ironmongers) Ltd [1969] 2 QB 158
Goold v Commonwealth (1993) 42 FCR 51
Gould v Vaggelas (1985) 157 CLR 215
Henville v Walker (2001) 206 CLR 459
Holdway v Arcuri Lawyers (a firm) [2009] 2 Qd R 18
HTW Valuers (Central Qld) Pty Ltd v Astonland Pty Ltd (2004) 217 CLR 640
Jamieson v Westpac Banking Corporation (2014) 98 ACSR 63
Kenny & Good Pty Ltd v MGICA (1992) Ltd (1999) 199 CLR 413
Kizbeau Pty Ltd v W G & B Pty Ltd (1995) 184 CLR 281
Kyluk Pty Ltd v Chief Executive, Office of Environment and Heritage (2013) 298 ALR 532
Lederberger and Scheiner v Mediterranean Olives Financial Pty Ltd (2012) 38 VR 509
Livingstone v Rawyards Coal Co (1880) 5 App Cas 25
Lyndel Nominees v Mobil Oil Australia Ltd (1997) 37 IPR 599
Marks v GIO Australia Holdings Ltd (1998) 196 CLR 494
McDonald v Deputy Federal Commissioner of Land Tax (Cth) (1915) 20 CLR 231
Medtel Pty Ltd v Courtney (2003) 130 FCR 182
Murphy v Overton Investments Pty Ltd (2004) 216 CLR 388
Potts v Miller (1940) 64 CLR 282
Prince Alfred College Inc v ADC (2016) 258 CLR 134
Selman v Minogue (1937) 37 SR (NSW) 280
Smith New Court Securities Ltd v Scrimgeour Vickers (Asset Management) Ltd [1997] AC 254
Southern Cross Mine Management Pty Ltd v Ensham Resources Pty Ltd [2004] QSC 457
Taub v R (2017) 95 NSWLR 388
Tepko Pty Ltd v Waterboard (2001) 206 CLR 1
Travel Compensation Fund v Tambree (t/as R Tambree and Associates) (2005) 224 CLR 627
Twycross v Grant (1877) 2 CPD 469
Upside Property Group Pty Ltd v Tekin (2016) 18 BPR 36,19
Vautin v BY Winddown, Inc. (formerly Bertram Yachts) (No 4) [2018] FCA 426
Westpac Banking Corporation v Jamieson [2016] 1 Qd R 495
Wyzenbeek v Australasian Marine Imports Pty Ltd [2017] FCA 1460
Yam Seng Pte Ltd v International Trade Corporation Ltd [2013] EWHC 111 (QB)
Date of hearing: 3-5, 11 October 2017; 3-6, 9-11, 16 April 2018 Date of last submissions: 23 April 2018 Registry: New South Wales Division: General Division National Practice Area: Admiralty and Maritime Category: Catchwords Number of paragraphs: 332 Counsel for the Applicants: Mr J Giles SC with Mr R Clark Solicitor for the Applicants: Silberstein & Associates Counsel for the First and Second Respondents: Mr G Sirtes SC with Mr F Forde Counsel for the Third and Fourth Respondents: Mr G Sirtes SC with Mr D Lloyd Solicitor for the First, Second, Third and Fourth Respondents: Gadens Lawyers Counsel for the Sixth Respondent: Mr S Donaldson SC with Mr M Newton Solicitor for the Sixth Respondent: Clyde & Co Counsel for the Seventh Respondent: Mr D Robertson Solicitor for the Respondents: Norton Rose Fulbright
Table of Corrections 19 October 2018 In the Date of hearing on the cover page the dates 3-5, 11 October 2017 have been added. ORDERS
NSD 911 of 2015 BETWEEN: NORBERT ANDRIES WYZENBEEK
First Applicant
SHARON CARMELLA WYZENBEEK
Second Applicant
EAGLEHAT PTY LTD ACN 002 008 933 AS TRUSTEE FOR THE N&S WYZENBEEK FAMILY TRUST
Third Applicant
AND: AUSTRALASIAN MARINE IMPORTS PTY LTD ACN 083 056 893
First Respondent
GOLD COAST CITY MARINA PTY LTD ACN 093 695 283
Second Respondent
DEAN PARKER LEIGH-SMITH (and others named in the Schedule)
Third Respondent
JUDGE:
DERRINGTON J
DATE OF ORDER:
10 OCTOBER 2018
THE COURT ORDERS THAT:
1.The first and second applicants have judgment against the first respondent in the sum of one hundred and sixty-eight thousand, three hundred dollars ($168,300.00).
2.The first and second applicants and the first respondent are to bring in short minutes of orders in relation to the interest which ought be paid on the sum of $168,300.00 from 30 June 2012 to the date of judgment or, in the absence of agreement, the matter be relisted for hearing on that question.
3.Otherwise the applicants’ claims against the first, second, third and fourth respondents are dismissed.
4.The further hearing of the matter is adjourned to a date to be fixed.
5.The parties are to be heard on the question of costs.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
DERRINGTON J:
Introduction
Norbert Andres Wyzenbeek (Mr Wyzenbeek) has been a keen sailor all his life and has, over the course of many years, owned several boats. Shortly prior to 2010, Mr Wyzenbeek had a 59 foot sailing yacht called “Swanky”. He acquired it in 1999 and, with his wife, Sharon Wyzenbeek (Mrs Wyzenbeek), sailed it on many occasions, including on international journeys. Indeed, after he acquired it in Finland they sailed it for three and a half years, concluding that voyage in Australia. The trip had taken them three quarters of the way around the globe and they harboured a continuing desire to complete a full circumnavigation. Unfortunately, Mrs Wyzenbeek’s health deteriorated and she was not able to cope with the rigors of sailing. That necessitated the abandoning of a sailing yacht in favour of a motor vessel.
Over the years Mr Wyzenbeek had come to know Dean Leigh-Smith (Dean) and Ryan Leigh-Smith (Ryan), each of whom were involved in the Gold Coast City Marina at Coomera. They were aware that Mr and Mrs Wyzenbeek wished to acquire a motor vessel capable of crossing oceans so that they might continue their travels and, in particular, to complete their circumnavigation of the world. They each promoted to the Wyzenbeeks vessels manufactured by Hampton Yachts in China, which were branded Endurance vessels. In doing so, and for the purposes of securing a sale of an Endurance vessel they represented, although mainly to Mr Wyzenbeek, the vessels in the Endurance range were, or would be, suitable for crossing oceans or for extended ocean voyages. Those representations were quite untrue and neither Ryan nor Dean had any reasonable basis for making them. Nevertheless, the representation had the intended consequence of inducing the Wyzenbeeks to purchase an Endurance vessel. The one acquired was an Endurance 750, Hampton yacht for which they paid $4 million and which they named “Cadeau”. The entry into of the contract of purchase followed extended discussions and Mr Wyzenbeek, who is a very astute businessman, secured a fairly good bargain on the purchase. Whilst the vessel was probably worth what the Wyzenbeeks paid for it, it was not suitable for the purposes for which they indicated they intended to use it.
They took possession of the vessel in early 2011 and, after approximately 20 months of use, including an unfortunate incident in October 2012, which caused substantial damage, Mr Wyzenbeek ascertained that Cadeau was not suitable for crossing oceans, or for extended ocean voyaging. Although at the time he made some complaints about having been misled as to its ocean-going capabilities, he and Mrs Wyzenbeek continued to use it for their sailing activities. Since its acquisition the value of the boat has depreciated significantly, as is the nature of such assets. On 31 July 2015, the applicants commenced this action and they seek damages from the company from which the vessel was purchased as well as from others whom, they allege, made the representations which induced its acquisition. The damages sought are intended to place them into a financial position whereby they might now acquire a new ocean-going vessel. A difficulty that confronted them by the time of trial was that the vendor company, Australian Marine Imports Pty Ltd (AMI), was in liquidation and the chances of recovery against it appeared somewhat minimal. Although it remained a party to the action, as the matter progressed the focus of the applicants’ claim has been their action, founded upon misleading or deceptive conduct, against the other parties.
The difficulty for Mr and Mrs Wyzenbeek is that it was not established the misleading conduct caused them loss. Although Cadeau was not suitable for crossing oceans, it was worth what they paid for it. Apart from inducing them to acquire Cadeau, it was not pleaded that the misrepresentations had any other consequence resulting in loss for the Wyzenbeeks, or in the diminution in their economic position. Whilst it is true the vessel has depreciated in value over the years since it was acquired, that is a consequence of its extensive use by Mr and Mrs Wyzenbeek and the effect of the effluxion of time on assets of this nature. The applicants submitted that the correct measure of loss should be the difference between the amounts spent on the vessel and its value at the date of trial. However, the twin difficulties with that submission in this case is that it seeks to award damages for losses which were extrinsic or supervening to, or independent of, the alleged misleading conduct and, additionally, the applicants were unable to establish the value of the vessel at trial.
The applicants are entitled to recover damages against AMI for breach of an implied term as to the fitness for purpose of the vessel, limited to the losses which are a consequence of the vessel not being of the required quality. Such damages are not, as the applicants argued, to compensate for any defect in the vessel no matter how insignificant and no matter how irrelevant to its ability to traverse oceans or engage in extended ocean voyaging.
The respondents vigorously fought every issue in the matter. In their defences they denied allegations which their witnesses freely admitted whilst giving evidence. They argued points of law which were not genuinely sustainable. Indeed, the overwhelming portion of the trial was taken up considering issues which, in the light of the evidence, were not truly in contest. The defences filed did more than merely put the applicants to proof, they contained denials which were very regularly shown to be disingenuous. Ultimately, the respondents’ success turned on the questions of causation and damage which, in the scheme of the case, were both fairly narrow issues.
Facts
Mr Wyzenbeek’s sailing history is important to the consideration of the issues in this matter. He has been a keen sailor for many years. In 1987, he took possession of a 38 foot yacht called “Upriver”, which he had caused to be constructed in the Philippines. The Wyzenbeeks sailed that vessel throughout Australian waters and around the South Pacific. In 1999, he took possession of Swanky, which he had built for him in Finland. The Wyzenbeeks then journeyed from Finland to Sydney over 3 and a half years. On that journey they visited numerous countries in Europe, the Atlantic and the South Pacific. Naturally enough, the successful completion of such sailing exploits requires substantial skill and experience. Mr Wyzenbeek has acquired those capabilities through his years of sailing and the completion of various courses.
Mr Wyzenbeek gave evidence that he and his wife wished to complete the global circumnavigation which they commenced in 1999. They also wished to journey more regularly and for longer periods. Those thoughts manifested themselves from around about 2002, during which time he was a regular visitor to the Gold Coast City Marina, a business operated by Gold Coast City Marina Pty Ltd (GCCM), the second respondent. Its business facilities consist of numerous moorings, hard stands and light industrial buildings as well as administration offices located in the Gold Coast suburb of Coomera and on the Coomera River. At all relevant times, Ryan was an employee of GCCM and was referred to as its “ship yard manager”. Dean was its director, as well as being a director and employee of AMI.
Mr Wyzenbeek gave evidence that he attended the marina at GCCM’s premises in 2002, 2004, 2005, 2007, 2009 and 2010. He said that on some of those occasions he spoke with Ryan or Dean or both of them about replacing Swanky and the general gist of the conversations was that he wanted a “trawler-style” motor vessel which would be suitable for completing his global circumnavigation.
By about 2009, Mr and Mrs Wyzenbeek’s desire to acquire a new motor vessel had intensified and in about October 2009, they, by Mr Wyzenbeek, provided to Dean a list of specifications which they desired in a trawler-style vessel. The document was headed “Specifications for Open Ocean Category “A” Trawler, September 2009”. The first specification read “Class A, US Coastguard and IMO Standard, Sea State 5, who rates CAT A vertical acceleration, stability”. The reference to “Open Ocean Category A” was apparently a reference to the European Union Standards of Vessel Classification, which identifies such vessels as being constructed to a standard that makes them safe to use for ocean cruising. That internationally recognised standard of categorisation seemed to be well known to the experts in this matter. It was not, however, known by Ryan or Dean, which was unusual because they purported to sell vessels for use in the open ocean.
Mr Wyzenbeek’s list was several pages long and consisted of minute requirements for the vessel he wanted and included a requirement for sea trials over a 50 hour period. He did not independently develop this list and it seems he obtained various specifications from the internet and, in particular, from the website of Marlow Yachts, a USA based boat manufacturer. The existence of Marlow Yachts as a manufacturer of ocean-going motor vessels is important as that was the source of an alternative vessel for the Wyzenbeeks had they not been misled into acquiring the Endurance 750. Mr Wyzenbeek had some familiarity with the Marlow vessels and immediately prior to entering into the contract to acquire the Endurance 750 he had in place plans to visit the Marlow factory in Florida, USA, or, so he said.
Mr Wyzenbeek gave evidence that, shortly after sending the specifications, he had a telephone conversation with Dean about them. He alleges that Dean said words to effect that yachts in the Endurance series were ideally suited to meet Mr Wyzenbeek’s purpose and specifications and they were suitable for trans-oceanic crossing. He further asserted Dean also said he would provide additional information to substantiate the suitability of Hampton yachts and the Endurance range of vessels. Dean could not recall this conversation, but I accept it occurred, generally in the manner stated by Mr Wyzenbeek, largely because it is consistent with subsequent comments made by Dean.
Shortly after this conversation, on 15 October 2009, Dean sent to Mr and Mrs Wyzenbeek an email concerning their recent discussions. In it he thanked them for their inquiry in relation to the Endurance range of luxury yachts. He said there were a number of vessels in the production line which may be of interest to them and he had possession of an Endurance 650#5, which was recently sold “here at GCCM”, and a Hampton 680 Pilothouse, which had been sold to a Sydney client. Dean also wrote that, as he had mentioned in their conversation, he, along with two of his engineers, frequented the Hampton factory regularly and worked to ensure that every boat sold is “100% right prior to departing the factory”. He then extolled the virtues of the brand in the following terms:
The Hampton yard is a very high quality facility turning out some amazing products. The Endurance range is particularly impressive as they can achieve terrific sea keeping with amazing economy. These points coupled with their impeccable standards of craftsmanship and construction techniques all add up to a winning combination. I must say words don’t do the product justice & an inspection is a must if you guys are potentially in the market for this style of vessel.
Dean also attached to the email a current price list as a guideline and said he wished to sit down with the Wyzenbeeks so they could create their “perfect vessel”. He further identified that the full Endurance range of vessels were viewable at Hampton Yacht’s website and attached some technical data relating to the vessel. In addition, he offered to give Mr Wyzenbeek a free berth at the GCCM for up to two nights to allow him to inspect the Endurance. This latter point is not insignificant as the marina was owned and operated by GCCM, but the respondents assert the sales were only conducted by AMI. Dean’s ability to offer free use of GCCM’s facilities suggest otherwise. The email also had a heading “Vessel Options/Suggestions as Requested”. Under that were a number of photographs of various vessels in the Endurance range and some brief details about them as well as links to the Leigh-Smith Cruiser Sales webpage.
The applicants rely upon the physical attributes of the correspondence sent by both Dean and Ryan as representations of the relationship of the respondents inter se and their authority to act on one another’s behalf. The signature block on Dean’s email identified him as “Director – Gold Coast City Marina; Dealer Principal – Leigh-Smith Cruiser Sales”. The website address of appeared on two occasions in bold lettering and underlined. Dean’s email address was specified, the domain of which was “@gccm.com.au”. These references, especially the reference to GCCM’s website”, are important because they support the applicants’ argument that, at the time, Dean was acting for and on behalf of GCCM and, possibly, AMI too.
On 28 October 2009, Dean had further telephone conversations with Mr and Mrs Wyzenbeek. He then sent an email at 12.34pm in which he wrote he had requested information on the “Rating” of the Endurance range of yachts in various sea states. He indicated that he knew the Endurance Series had been tested in a Sea State 4, but he was awaiting advice from the manufacturer and naval architect. He also attached a document that, allegedly, recorded the speed curve test for the 650#5 vessel and indicated the range of that vessel was 2,000 nautical miles at around 9 knots. Dean’s signature block appeared again in this email and was unchanged.
At 2.38pm on 28 October 2009, a further email was sent to Mr and Mrs Wyzenbeek from Dean. He attached some comments from Mr Howard Apollonio, the naval architect who designed Hampton vessels. Dean identified those comments as being very positive. He also made reference to Mr Apollonio’s discussion of the Marlow Explorer vessel design, which took into account the Wyzenbeeks’ requirements. Dean accepted during cross-examination that those requirements included the vessel being suitable for trans-ocean travel. Perhaps unsurprisingly, the comments of Mr Apollonio spoke well of the Endurance vessels. He said because they were rated for ocean service to US Coastguard IMO standards, “they are thereby considered capable of handling anything that comes along in a long open sea voyage. That does not mean one should go challenge a hurricane. At least these boats have the speed to avoid such things”.
Later on 28 October 2009, there was some further email communication between Dean and Mr Wyzenbeek mostly concerning the capacity of the Caterpillar engines and the range of the Endurance vessels.
Mr Wyzenbeek asserted that around this time, being about October 2009, Ryan provided him with a brochure, or brochures, relating to the Endurance range of vessels. Whether Ryan handed that material to him personally or left it in Swanky does not matter. What is relevant is that Ryan attached to these brochures his business card, which identified him as the “Shipyard Manager” and had on it the logo and name of Gold Coast City Marina and Shipyard. It also had Ryan’s email address, the domain of which was also “@gccm.com.au”, and the website address of Gold Coast City Marina. Again, this assumes relevance in relation to the identity of the entities that made the representations to the Wyzenbeeks, particularly that the representations were made on behalf of GCCM.
On 13 November 2009, Mr Wyzenbeek undertook an inspection of a 650 Endurance yacht at the Gold Coast City Marina during which Dean gave him a specification sheet in relation to that vessel. On 16 November 2009, Mr Wyzenbeek provided to Ryan an alternative set of specifications for the 650 Endurance Skylounge vessel. In particular, it included the following:
(a)A1 offshore rating supplied with vessel;
(b)Increased fuel capacity to 11,000 litres; and
(c)Vessel to be priced ex GST, ex duty, ex delivery include pre-delivery and commissioning Shanghai.
Dean immediately forwarded those specifications to Mr Chen of Hampton Yachts in China and sought a quote for a vessel constructed to satisfy them. He indicated that it was to be fully completed in China, collected there and immediately taken on international travel. Again Dean’s email contained his standard email signature block.
On 25 November 2009, Dean sent an email to Mr and Mrs Wyzenbeek, copying it to Ryan. It contained a quotation for the sale of a Hampton Endurance 65 foot Skylounge vessel built to a list of identified specifications. The price offered was $2,475,000 USD delivered ex Shanghai. Of importance was Dean’s observation that he was still awaiting the “A1 offshore rating to be supplied with the vessel – same as Marlow website”. He indicated that the Endurance was built for offshore conditions, but he had to investigate all liabilities and guarantees made by the factory before confirming them although, he added, this would not be a problem. One of the specifications and options identified was that there would be coordination to prepare a list for major spares required for immediate ocean crossing. The email included the comment:
I believe that the vessel we have specified is ideally suited to your requirements & will serve you both very well. I look forward to hearing from you soon to discuss further.
Although it finished with Dean’s standard email signature block highlighting Gold Coast City Marina, the content of the email indicated that AMI would be involved in the importation of the vessel. The applicants rely upon this as part of Dean’s representations that the vessel would be suitable for crossing oceans or extended ocean voyaging. Certainly, Dean was well aware that these were part of the Wyzenbeek’s requirements and his assertion that the specified vessel would meet them was an express affirmation that the Endurance vessels had that capability.
On 26 November 2009, Dean sent to the Wyzenbeeks an email in relation to that quotation. In it he said he believed the quotation accommodated all of the Wyzenbeeks’ requirements at that point. He also made himself and Ryan available to discuss the matter. In response, Mr Wyzenbeek sent to Dean his previous specification list. That document is headed “Partial specification and checklist”. It is to be observed that although reference to Class A US Coastguard and IMA standard remained, the reference to a “Category A” did not.
Dean replied to Mr Wyzenbeek on 27 November 2009 and suggested a meeting with himself and his engineers. He suggested that, after those discussions, Mr Wyzenbeek would appreciate that the initial specifications identified by Dean would have more benefits for cruising the east coast of Australia.
On 1 December 2009, Dean sent an email to Mr Wyzenbeek (again copied to Ryan) concerning the A1 offshore rating in relation to the Hampton Yachts. That email passed on some comments contained in an email from Mr Chen in which he asserted that the A1 offshore rating was a European EC rating and that the standard of the Endurance Series was equal to, or surpassed, such a rating. It was mentioned that to apply for and obtain an A1 offshore rating would take about 6 to 8 months and would add USD $40,000 to the total cost. Dean then proposed that Mr and Mrs Wyzenbeek meet with his engineers to discuss the full vessel inventory from bow to stern to “ensure that we have the best equipment on the vessel taking into account the trans-ocean crossing you will be undertaking with it before entering back to Australian waters”. He further said, “I know that you’re doing lots of research on your future vessel & greatly look forward to building you a superior Endurance yacht vessel which is tailored to your needs”.
At this point it did not appear to be in doubt that the Wyzenbeeks wished to use the vessel for crossing oceans and this was known to both Dean and Ryan. As appears from the correspondence, both Ryan and Dean conducted their communications on the basis that the Hampton vessel to be sold to the Wyzenbeeks would be suitable for trans-ocean crossing. In this context it should be observed that Mr Chen’s statement that the “A 1 offshore rating” was equivalent to a European EC rating was incorrect. The design categories of the CE Directive are Category A – Ocean or Category B – Offshore. There is neither an A1 category nor an A1 Offshore category in it.
From around this time Mr Wyzenbeek ceased dealing with Dean and, thereafter, dealt almost exclusively with Ryan. The reasons for this did not become particularly clear, however, in neutral terms, it might be said that Mr Wyzenbeek had a better working relationship with Ryan.
On 27 January 2010, Ryan contacted Mr Wyzenbeek via email to ascertain how he was proceeding on his purchase of a new vessel. He offered to show Mr Wyzenbeek a 65 foot Endurance which was presently in his possession. Ryan’s email signature block only referred to Gold Coast City Marina. Mr Wyzenbeek responded that he was planning to arrive at the Gold Coast City Marina around 28 March 2010, that he would require work to his vessel, Swanky, and that, presently, he preferred the Marlow vessel on the basis that it “is better built both hull and hardware”. That said, he did offer to visit the Shanghai factory of Hampton Yachts.
On 9 February 2010, Mr Wyzenbeek again emailed Ryan. In that email he indicated that his needs were for a 3,000 nautical mile range vessel and that he was still awaiting a quote from Marlow. Later that day Mr Wyzenbeek sent Ryan a further email in which he commented on the attributes of several vessels in the Endurance range. He attached a document containing a new list of specifications, which were substantially similar to those which he had previously sent. That document did not include a specification for a “Category A vessel”, but did refer to “Class A, US Coastguard and IMO Standard”. In the email Mr Wyzenbeek indicated that he had already booked his trip to the Fort Lauderdale Boat Show, where he would inspect the Marlow Yachts. He indicated that he could visit the Hampton Yachts factory on his return journey.
On 15 February 2010, Ryan sent the specifications to Mr Chen at Hampton Yachts. In the body of the email Ryan indicated that whilst Mr Wyzenbeek had been pursuing a Marlow for some months, he, that is Ryan, had convinced Mr Wyzenbeek to look at the Endurance range. He further indicated that the vessel Mr Wyzenbeek intended to acquire was to be immediately taken on a substantial ocean crossing and for that reason had to be fully commissioned at the factory. This email evidences Ryan’s appreciation of the Wyzenbeeks’ requirement that the vessel be capable of crossing oceans.
In the course of email correspondence on 16 February 2010, Ryan sent to Mr Wyzenbeek an email about Hampton Yachts pricing a vessel based on the specifications recently sent. Amongst other things, Ryan indicated that he was “excited about supplying in conjunction with Hampton Yachts your Endurance long range motor yacht”. In response Mr Wyzenbeek indicated there was no hurry with the quote as he was wanting to see a Hampton with a better layout, wiring and plumbing than the one he had been shown.
That seemed to generate some annoyance for Ryan who, on 17 February 2010, sent to Mr Wyzenbeek an email in which he stated:
I sent you the last email to prove to you we are serious about selling ocean going vessels…. If you wish to pursue Hampton “endurance” range please let me know. … Let me know honestly if you want me to proceed with the quoting process.
It was signed off, “Ryan Leigh-Smith, Shipyard Manager, Gold Coast City Marina”.
It cannot pass without comment that the statement in this email that Ryan was serious about selling ocean going vessels, is strongly supportive, by itself, of the applicants’ case that the respondents represented to the Wyzenbeeks that the vessels they were offering for sale were ocean going. This, along with other substantive evidence of the representations, renders quite disingenuous the respondents’ denial of the allegation they made them. Similarly, it is apparent that Ryan sent the email as a representative of GCCM and this adds to the large amount of evidence that he was acting on its behalf.
On 18 February 2010, Mr Wyzenbeek responded by an email in which he reiterated that he had reservations and would like to view an improved Hampton vessel. He indicated that the Hampton vessel he had viewed was disappointing for a number of reasons.
On 24 February 2010, Mr Wyzenbeek informed Ryan by email that he would be sailing from July until October in the Pacific and then, in October, he would be attending the Fort Lauderdale Boat Show and then going to China. He indicated the sailing venture mentioned was to be his last offshore voyage aboard Swanky before he acquired a motor vessel.
On or around 29 March 2010, Mr Wyzenbeek was at Gold Coast City Marina attending a boat show. He gave evidence that he spoke to Ryan about the Endurance range of vessels. His evidence was that Ryan said to him that he had received the specifications Mr Wyzenbeek had sent, that the list was detailed, and “that they could build a boat to suit that specification and that the vessel would be suitable for trans-oceanic - oceanic work, and that the vessel that they would provide would be – included in that vessel would be a commercial continuous C8 C-rated engine” (ts.303). Although there was some initial dispute about the precise terms of this conversation, Ryan indicated he may have told Mr Wyzenbeek that the Hampton Range was suitable to cross oceans and, under cross-examination, he acknowledged he said words to the effect that Hampton could build a vessel which would meet the specifications provided and that the Hampton range of vessels could be used for crossing oceans. There is nothing particularly unexpected about this as it is consistent with the substance of their previous discussions. What is surprising, however, was the respondents’ denial of these pivotal allegations in the pleadings.
Mr Wyzenbeek gave evidence that, at around this point in time, he indicated he was still leaning towards a Marlow vessel and he would be booking tickets to go to the United States to purchase such a vessel in 2010 for delivery in 2011. Under cross-examination, Ryan agreed Mr Wyzenbeek said this to him and, further, that he would need to be convinced the Endurance Series would be suitable for his needs.
Further support for Mr Wyzenbeek’s claim that it was represented to him the Endurance range would be suitable for his needs appears in an email from Ryan to Mr Chen of 26 May 2010. There, Ryan spoke about a quote for Mr Wyzenbeek on a 680 Endurance. He concluded by saying, “I believe we have presented a great package at the boat show and have now got him leaning towards the Endurance brand”.
Whilst there appears to have been a cooling of negotiations after March 2010, on 20 July 2010 Ryan sent to Mr Wyzenbeek an email in relation to an Endurance 750 yacht. That was a 75 foot long vessel which was a 68 foot vessel design although lengthened by 7 feet at the stern. After giving details of the vessel he stated:
The boat specific listing is on our brokerage website “Leigh-Smith cruiser sales” and can be viewed at: >
The price was identified at between $3.95 million and a little over $ 4 million. The email was signed off with Ryan’s signature block which included the Gold Coast City Marina and Shipyard details and its website address. Under his name and asserted title of “Director of Gold Coast City Marina”, were the words “Leigh-Smith Cruiser Sales”. It is uncontentious that he was not, at any time, an employee of AMI, which operated under the business name of Leigh-Smith Cruiser Sales. This email is relevant to the issue of the identity of the parties who can be taken to have made the representations to Mr Wyzenbeek. Ryan’s reference to “our brokerage website”, supports the proposition that the Gold Coast City Marina and AMI businesses operated as one business. Even though he held himself out as a director of GCCM, it is not clear Ryan was actually a director of GCCM at that time. That his signature block indicated he was a director suggests he was permitted by the company to hold himself out as being one.
The email contained a number of attachments including a document titled “Endurance 750 Hardtop (680 plus 7)”. In it, the seagoing capabilities of the Endurance 750 were highlighted identifying that the vessel was perfect for long range cruising and could comfortably cruise the Coral Sea and many other long haul destinations in comfort and style.
Mr Wyzenbeek claims he relied upon this email of 20 July 2010 as indicating the Endurance 750 was better than the smaller vessels which he had been shown and was capable of trans-oceanic crossings. Certainly, at this stage, there is little doubt both Ryan and Dean were both aware of Mr Wyzenbeek’s intention to take the vessel he acquired across oceans. Considering the prior conversations and correspondence between Ryan, Dean and Mr Wyzenbeek, as well as the context in which the information about the 750 Skylounge Cruiser was provided it was reasonable for Mr Wyzenbeek to assume he was being informed the Endurance 750 was suitable for crossing oceans. Mr Wyzenbeek also gave evidence that his views were confirmed by the various articles published from October 2009 to July 2010 regarding the Hampton range of vessels. Those articles propounded the ability of the vessels to engage in oceangoing passages as well as continental circumnavigation and Pacific Island cruising. Whilst the existence of these articles is not unimportant, it is not clear they were made or promoted by the respondents. They do not form part of the representations on which the applicants rely to prosecute their case.
In September 2010, Mr Wyzenbeek returned to the Gold Coast City Marina for the purposes of having anti-fouling work and other maintenance performed on Swanky. In his evidence he says that, whilst he was there he had a number of conversations with Ryan and, in one, Ryan said he had been authorised by Patrick Gay, the chairman of Gold Coast City Marina, and Jeff Leigh-Smith, the director of Gold Coast City Marina, to make a trade-in offer on Swanky in respect of a purchase of an Endurance 750 which had been completed and could be shipped from China at the end of the month to arrive in November. Mr Wyzenbeek’s evidence was that Ryan told him the vessel had been built in Shanghai by Hamptons and was an Endurance 750. After Mr Wyzenbeek told Ryan he had already booked tickets to go to Florida to see the Marlow vessels, he alleges Ryan said a number of things that: Hamptons had built the 750 virtually to his (Mr Wyzenbeek’s) precise specifications; the vessel was complete and he could have it immediately; and, further, that it had a range of more than 3,000 nautical miles and redundant systems. Mr Wyzenbeek also says he was told the vessel had commercial continuous running C-18 engines and it was “American Bureau of Yachting Council compliant”. Although Ryan denies saying this, it would be surprising if that were not said. It is apparent the vessel was constructed in general accordance with most of Mr Wyzenbeek’s specifications and the negotiations, discussions and communications between Ryan, Dean and Mr Wyzenbeek, had often referred to similar capabilities of the vessel Mr Wyzenbeek wished to acquire. However, nothing really turns upon this.
After this conversation, Mr Wyzenbeek accompanied Ryan to Ryan’s office where he was given a sales brochure that contained the specifications for the Endurance 750. Mr Wyzenbeek gave evidence there was a discussion about the price, the specifications and the delivery time of the Endurance 750 as well as the trade-in price of Swanky. After that, and although no agreement had been concluded, Mr Wyzenbeek returned to his vessel, Swanky, which was then on a hard stand at GCCM.
Sometime later Ryan attended on Mr Wyzenbeek in the vicinity of Swanky. He said to Mr Wyzenbeek that Mr Gay and Mr Jeff Leigh-Smith had authorised him to make an offer to sell the Hampton Endurance 750 to him with Swanky being traded-in for $1 million. Ryan said that the Endurance 750 was virtually complete and would be available in November. That, apparently, was sufficient to finally induce Mr Wyzenbeek to agree to purchase the Endurance 750 and it seems he indicated he would do so. In his evidence he said that, in entering into the agreement, he relied upon the representations made to him that the Endurance 750 was suitable for trans-oceanic passage. Those representations were, he claims, contained in the various conversations he had and in email exchanges with Ryan and Dean.
Mr Wyzenbeek and Ryan returned to Ryan’s office for the purposes of considering the terms of a contract of purchase and, if suitable, executing it. On that occasion there was considerable discussion about the vessel and its specifications. It appears there were also discussions about the warranty on the vessel, other special conditions and the terms generally.
Ryan gave evidence the contract was signed on 10 September 2010 after its terms and the items on the specification sheet had been the subject of discussion between him and Mr Wyzenbeek.
Mr Wyzenbeek gave evidence the contract was entered into on 14 September, but I apprehend that he was mistaken in this. It seems the initial contract was entered into on the day on which the terms were finally negotiated in Ryan’s office at GCCM. Ultimately, the date on which it was entered into is not critical to the outcome of this matter and it is clear that it went through a number of iterations, especially in relation to the identity of the purchaser.
The contract for sale was contained in a pro forma contract for the sale of a vessel, but a number of special conditions were included in Item M of the Schedule. The broker was identified as “Leigh-Smith Cruiser Sales”, although the ABN provided below that name was that of GCCM. It was executed by Mr Wyzenbeek on behalf of the buyer. In this matter the respondents rely, particularly, upon clause 11 of the contract, which provided:
11. BUYER ACKNOWLEDGMENTS
The Buyer acknowledges that:
(a)No warranties or representations (except those given in this Agreement) regarding the Vessel (including its suitability for any purpose, its quality or seaworthiness or otherwise), have been made by the Seller, the Broker or any person on their behalf; and
(b)The Buyer relies upon its own enquiries, inspection, investigation and knowledge with respect to the Vessel to enter in this Agreement.
(c)The Broker in all instances is acting as the Sellers agent.
In the initial stages of the purchase there was some uncertainty as to the identity of the purchaser. Originally, the contract identified Eagle Hat Pty Ltd ATF The N&S Wyzenbeek Family Trust. From 10 September 2010, Ryan had various email communications with a Mr Nic Reynolds, an employee of Mr Wyzenbeek, in relation to whether Eagle Hat or the Wyzenbeeks ought to be the purchasers. After several discussions and on the receipt of advice from Mr Wyzenbeek’s accountant, on 25 January 2011, the contract of purchase was amended such that the purchasers were Mr and Mrs Wyzenbeek. All parties accept this was the agreement pursuant to which the sale took place.
There also appears to have been some subsequent discussions after 10 September 2010 as to the dates Mr Wyzenbeek would make the payments pursuant to the payment schedule and the manner in which he would pay them. Further, after the contract was entered into Mr Wyzenbeek sought personal guarantees from GCCM, whom Ryan identified as the substantial asset owner in the group. Subsequently, guarantees of the seller’s delivery obligations were provided from the directors of GCCM and AMI. They were contained in a document on AMI letterhead and were given in favour of Eagle Hat Pty Ltd as the purchaser of the vessel.
From about mid-September 2010, Mr Wyzenbeek engaged in email correspondence with Ryan as to numerous matters with respect to the vessel. These had not been agreed upon as at the date of the contract and, as the correspondence shows, Ryan attempted to accommodate what were effectively changes to the specifications of the vessel, or simply additional features Mr Wyzenbeek desired. Mr Wyzenbeek’s requests for additional benefits or alterations to what had been contractually agreed continued through the latter part of September 2010 at around which time he attended at the Hampton factory in Shanghai.
There appears to be some dispute about what exactly occurred during Mr Wyzenbeek’s visit to the factory in Shanghai. Ryan asserts Mr Wyzenbeek carefully considered the vessel and inspected all parts of it. Mr Wyzenbeek asserts that, given the vessel was substantially complete, he did not have a sufficient opportunity to inspect it in detail. Whilst it is apparent Mr Wyzenbeek was very inquisitive as to the minutia of the fittings on the vessel and somewhat pedantic about them, it does not appear he was able to ascertain the quality of the vessel’s structure in any way, nor the appropriateness of the fittings for use on an ocean going vessel. No party suggested he could assess the seaworthiness of the vessel by merely inspecting it as it was being completed.
Delivery of Cadeau to GCCM
The Endurance 750 Skylounge was transported to Gold Coast City Marina on 27 January 2011. By that time Mr Wyzenbeek had determined to name it “Cadeau”. However, on its arrival at the Gold Coast a number of issues had arisen. A window in the Skylounge had cracked; the batteries were not charging properly and were bulging; and, on the voyage from Brisbane to GCCM, an oil hose came lose causing oil to be sprayed in the engine room and on the gear box causing damage beyond repair. The repair and rectification of those issues was attended to by AMI or GCCM at the marina.
Although the commissioning of Cadeau commenced on 7 February 2011, it took substantially longer than anticipated. Some of the delay was probably caused by disputes as to the nature of the work to be done. Mr Wyzenbeek asserted that various matters with respect to the vessel were defects which required rectification, whereas Ryan and Dean alleged that they were modifications and were outside the contractual terms. It does not matter for the purposes of the action where the truth in that lies. However, there is no doubt that the vessel did contain some defects and, in particular, the engines which were fitted to the vessel were not Caterpillar C-18, but were in fact “D” rated. On the other hand, it certainly appears Mr Wyzenbeek, being the canny businessman he was, sought to obtain benefits not within the scope of the contract at no additional cost.
Post-handover defects
Mr and Mrs Wyzenbeek took possession of Cadeau in late March or early April 2011. All contractual payments had been made as well as a further $231,460.21 paid in respect of additions and modifications.
On 15 April 2011, Mr and Mrs Wyzenbeek motored Cadeau from the Gold Coast City Marina to Hamilton Island. During that voyage, and in the subsequent weeks, a number of defects appeared and the respondents, or at least AMI, attended to most of the required repairs. It did so by sending marine engineers to Hamilton Island or Cairns where the vessel was located so that the necessary remedial work and alterations could be undertaken.
Between 21 July 2011 and 16 August 2011, Mr and Mrs Wyzenbeek motored Cadeau from Cairns to the Torres Strait and returned again. During the course of this voyage a number of further defects were noted by them including:
(a)A significant amount of sea water was found to be leaking into the vessel. It had apparently entered through the port lights, bollards and deck fittings;
(b)There was significant delamination and cracks in the anchor locker leading to leaking; and
(c)The batteries were overcharging to the point of destruction.
From 16 to 22 August 2011, remedial work was undertaken on the vessel by Mr Bone and Mr Furnance of AMI and by a Mr White from Wright Marine in Cairns. However, further leaking of seawater through the port lights, stanchions and fair leads occurred. Mr Wyzenbeek asserted that, at around this time, other defects in the vessel became apparent. On 8 September 2011, he caused Cadeau to be motored to the Gold Coast City Marina for further repairs to be carried out and some work was done between 8 and 22 September 2011, although not all of the identified defects were rectified.
Cadeau was motored to New Caledonia and back in the period from 22 September 2011 to 25 October 2011. On its return it was taken to GCCM for further repairs, which Mr Wyzenbeek claimed ought to be undertaken pursuant to the warranty obligations.
Over the following months Mr Wyzenbeek undertook a number of voyages and Cadeau was used for a not insignificant period of time. However, all of his sailing was not without concern and he frequently identified various issues with Cadeau, which he claimed ought to be repaired pursuant to the various warranties provided.
From the evidence adduced on this issue it can be said that, for some period after Cadeau’s acquisition, a number of defects in or issues with the vessel came to light. For its part, AMI or the companies associated with it, attended to the repairs or rectifications where it considered the defect or matter was covered by the warranties. Some of these issues, particularly those relating to the leaking port lights, were not insignificant. On the other hand, a number of the issues were properly recognised as “teething problems” which necessarily arise in the initial voyages of new vessels of this type.
Realisation by Dean and Ryan that the vessel was not suitable for trans-ocean crossing
Around this time, being approximately September 2011, there were a large number of warranty claims on foot with respect to Cadeau. Mr Wyzenbeek had also been making constant complaints about excessive leaking. This led to a series of emails between Dean and Mr Chen of Hampton Yachts. Ryan and a number of other Gold Coast City Marina and AMI staff were copied into this correspondence. The discussion touched upon the question of the appropriate rating of Cadeau and the standard to which she had been built. This issue arose in the context of the adequacy of the port lights on the vessel (being portholes on the hull of the vessel covered by glass in-set fittings). At the time, similar problems had occurred on another Hampton 750 yacht sold to a Mr Robert Tucker. That yacht is described as being the Hampton 750#8. In the correspondence, Dean opined that the port light fittings used in the construction of the Hampton 750s were inadequate and higher grade ones with “through-bolting” ought to have been used and should be used on any future vessels.
By an email of 19 September 2011, from Dean to Mr Chen (copied to Ryan and others) Dean said, amongst other things:
In short the existing PORTLIGHTS are not working… I expect that Hampton will “FIX THE PROBLEM”, your inference that “Norbert is using the vessel in extreme circumstances” is not the case. We sell every Endurance as being capable of “trans ocean crossings”. You market the boats on the Hampton website as “US Coast Guard Offshore Rating 1 vessel” & they are obviously falling short in this case. I’d ask that Hamptons stand by the product & uses the appropriate equipment.
Dean went on to identify why, in his opinion, the port lights used on Cadeau and other Hampton vessels were inadequate. He sought Hampton’s assurance that the issue was a warranty matter for which Hampton would pay.
By an email of 20 September 2011 from Mr Chen to Dean (and copied to Ryan and others), Mr Chen responded to Dean’s comments. He agreed that the port lights on Cadeau would be changed at Hampton’s cost. Importantly, in his email he also stated:
We want to clarify that we never advertise the Endurance to be Capable of “Trans Ocean Crossing”. In order to be Trans Ocean Crossing vessel, the vessel need to be Class Certified to R1 or R0. This is a total difference design criteria and construction method. We want to emphasis that we advertise the Endurance to be a Long Range Cruiser, and we should not mis-lead the customer.
(Grammatical errors in original).
Mr Chen also stated that there was no such criteria as US Coastguard Offshore Rating 1 and he did not know what it meant.
By an email on 20 September 2011, Dean wrote back to Mr Chen (copied to a range of people including Ryan) in which he said:
What is required to get your vessels built to CE STANDARD, we must provide products at CE Standard or ISO from herein. This European CE standard is recognized here in australia and we are being met with more strict rulings daily. Please comment.
It should be emphasised the email of 20 September 2011 from Mr Chen was admitted only for the fact that it was sent and received and it stated the matters in it. The tender of the email as evidence to prove the truth of its contents was objected to and that objection was upheld. The applicants did not seek its admission as any form of business record. In any event, Ryan was cross-examined on the document and said that he believed the contents of the email were true; namely, the Endurance vessels were not suitable for trans-ocean crossing. In this respect, he had been put forward by the respondents as extremely knowledgeable about boats of this nature and no objection was taken to his evidence about the correctness of Mr Chen’s statements. That renders the contents of the email evidence on which the Court can rely even though the inappropriateness of the vessel for ocean going use was established in other ways.
Whilst the email from Dean asserted every Endurance vessel had been marketed as capable of trans-ocean crossing, there is no suggestion the manufacturer’s contrary opinion was passed on to those to whom that statement had been made and who had acquired a vessel from the Endurance range. This new fact was not mentioned to Mr Wyzenbeek until the Port Macquarie incident, which occurred approximately a year later.
Port Macquarie incident
A matter which seemed to engage the parties in the production of a substantial amount of evidence was an incident that occurred whilst Cadeau was being motored across the bar at Port Macquarie in New South Wales. Although this topic assumed importance in the evidence in chief, very little cross examination occurred with respect to it and, at the end of the day, it is not a significant issue, which explains the absence of any emphasis on it in oral or written submissions.
On 21 October 2012, Mr and Mrs Wyzenbeek sailed Cadeau across the Port Macquarie bar and into the Hastings River. They remained at Port Macquarie for the following two days because conditions were not favourable for further travel to the south.
On 24 October 2012, in the early morning, Mr Wyzenbeek considered the weather conditions had calmed significantly and the sea was flat and calm with virtually no wind. He gave evidence he timed his crossing of the bar to occur at around 6 o’clock in the morning, shortly before sunrise. He says he followed the same route out of the bar that he had taken on his entry two days previously. Whilst crossing the bar Mr Wyzenbeek noted two waves came over Cadeau’s bow although they did not slow its speed. He said he had observed that on the bar there was a single line of occasional waves of approximately 1.6 metres and whist traversing the bar no spray from the waves coming over the bow blew onto the Skylounge windows. However, shortly after passing the bar Mrs Wyzenbeek heard water “sloshing around” below the Skylounge and fairly soon thereafter Cadeau lost electrical power. On investigation Mrs Wyzenbeek discovered a large amount of sea water and glass in the galley, dining room and saloon which had washed down into the lower areas of the vessel, including the engine room and sleeping quarters. She also saw that one of the fore windows of the galley had smashed and there were shards of glass of various sizes in the cabin. In addition, two doors (referred to as Portuguese Doors), which had been positioned on the forward deck of Cadeau, were found to have broken lose and were located to the aft of Cadeau.
Mr Wyzenbeek used Cadeau’s communication systems to seek assistance and after some discussion with Ryan and some other persons as to who might undertake repairs, Cadeau was motored back to the Gold Coast City Marina arriving at 2.30am on 25 October 2012.
At the marina, on 25 October 2012, Mr Wyzenbeek spoke to Dean and expressed his concern about the sufficiency of the glass in the vessel and, in particular, that it was not toughened glass. He also expressed his concern as to the adequacy of the Portuguese doors. He said to Dean that given these things and other defects in the boat, he was not confident it was suitable for trans-oceanic journeys. He says he was “absolutely flummoxed” when Dean said to him that the vessel was never designed for trans-oceanic voyaging. Although Dean’s evidence was that he did not say this, as appears later in these reasons, I do not accept that his recollection is correct. By this time he had been advised by Hampton Yachts that vessels in the Endurance Range were not suitable for crossing oceans. There is little reason to think he would not have said so when the issue arose.
Much occurred on and around Cadeau on 25 October 2012 including a consideration by various persons of the damage it had sustained. The next day Mr Wyzenbeek wrote to Ryan, Dean and Patrick Gay about his concerns in relation to the vessel. He expressed his surprise that the vessel was not designed to cross oceans. He said:
During discussions with Dean yesterday morning, he surprisingly said to me that Cadeau is not designed to cross oceans. You were both fully aware that crossing oceans was always our intentions. We relied in our purchase decision on yours and Hampton’s correspondence, marketing, brochures, specifications, websites and ‘YouTube’ clip etc states that the Hampton Endurance is an extended passage maker for open ocean service, built to exacting specifications with the finest attention to detail, creating a new benchmark that others can only attempt to emulate. We were advised that a team of designers, engineers, naval architects, and experienced craftsmen pour dedication and passion into every last detail. A passion to make our cruising a memorable and enjoyable experience. Please refer to the email below, the attachment above and also your emails dated 28th October, 2nd December 2009; and there are other emails that I have received from you regarding Hampton Endurance ocean sustainability, quality and engineering excellence.
Subsequently in the email Mr Wyzenbeek stated he expected the vessel to meet A1 offshore ratings in all respects, including in relation to the glass. He also said the Portuguese bridge doors were inadequate for their purpose of deflecting sea water.
A few days later Mr Wyzenbeek sent an email to the designer of the boat, Howard Apollonio, in which he also expressed his concern that the vessel was not suitable for open ocean service. He also said the Australian dealer sold Cadeau to him with the knowledge he would be using it for crossing oceans and perhaps circumnavigation of the globe.
Although there was subsequent communication from Dean to Mr Wyzenbeek, it is not irrelevant that Dean did not deny the content of Mr Wyzenbeek’s email and, in particular, that Mr Wyzenbeek had acquired the boat on the understanding that it was suitable for crossing oceans. In the light of the evidence set out above that is not surprising. On the other hand, Dean’s evidence that he did not say to Mr Wyzenbeek the day after the incident that the vessel was not suited to trans-ocean voyaging was dissembling.
Repairs made to Cadeau
Subsequent to the Port Macquarie incident the glass in the vessel was replaced and the Portuguese doors were repaired and improved. It is apparent some, if not all, of this rectification work was paid for by Mr Wyzenbeek’s marine insurer.
Thereafter, much disputation continued to occur in relation to various defects Mr Wyzenbeek claimed existed. Mr Wyzenbeek wished to have those defects remediated by AMI and/or GCCM. Subsequently, significant work to Cadeau was required to ensure it satisfied Australian standards. That work was necessary to enable Mr Wyzenbeek to obtain appropriate insurance.
Mr Wyzenbeek also claimed that, from March 2014 onwards, additional repair and rectification work was required, in this action he makes claims in respect of many of those items. In his witness statement he identified (at [169]) 725 days in the period from June 2011 to November 2016 during which, he says, he was unable to use Cadeau as a result of it being laid up for repair or rectification works. As will be discussed later in these reasons, when the vessel was not laid up for repair, as Mr Wyzenbeek claims, he and his wife continued to use it for their boating activities.
The claims as formulated
The Statement of Claim in this matter underwent a variety of amendments (see Wyzenbeek v Australasian Marine Imports Pty Ltd [2017] FCA 1460). Although initially the claims were broad and numerous, by the time the trial commenced in earnest they had been refined somewhat. The manner in which the case is now framed is as follows:
(a)From about October 2009 AMI, GCCM, Dean or Ryan represented to the applicants (being Mr and Mrs Wyzenbeek and Eaglehat) that:
(i)The vessels being offered for sale to the applicants were or would be suitable for trans-ocean crossing;
(ii)The vessels being offered for sale to the applicants were or would be suitable for extended passage in open ocean service.
(b)The representations were made orally or in correspondence and particulars have been provided as to the time and occasions on when they were made.
(c)The applicants agreed to purchase an Endurance 750 Skylounge vessel manufactured by Hampton Yachts from AMI in reliance on the representations made to them.
(d)A contract was subsequently entered into in reliance on the representations pursuant to which Eaglehat Pty Ltd agreed to purchase the vessel, however, Mr and Mrs Wyzenbeek were substituted as the purchasers in lieu of Eaglehat Pty Ltd in or around January 2011.
(e)The price paid for the vessel was $3.95 million.
(f)A term that Cadeau would be reasonably fit for crossing oceans, global circumnavigations and meeting the Wyzenbeeks’ specified requirements is allegedly implied pursuant to s 71(2) of the Trade Practices Act 1974 (Cth) (TPA).
(g)In breach of that implied term, the vessel supplied by AMI and GCCM was not reasonably fit for the identified purposes.
(h)AMI, GCCM, Dean and Ryan had made the representations referred to in trade or commerce and they were misleading or deceptive.
(i)By reason of the making of the misleading or deceptive comments AMI, GCCM, Dean and Ryan engaged in conduct in contravention of s 52 of the TPA, s 38 of the Fair Trading Act 1987 (Cth) (FTA) and s 18 of the Australian Consumer Law (ACL).
(j)By reason of the breach of the implied warranty of fitness for purpose, the applicants suffered loss and damage including:
(i)Costs of repairing defects;
(ii)Costs of and incidental to repairing and rectifying the vessel;
(iii)Costs of rendering the vessel closer to fitness for the purpose for which it was purchased;
(iv)Diminution in value of the vessel being the difference between the cost of the vessel and its present value;
(v)Loss of use; and
(vi)Other damages.
(k)That the damages identified were also suffered as a result of the misleading or deceptive conduct engaged in by AMI, GCCM, Dean or Ryan.
Claims are also made in the Statement of Claim against certain insurers concerning their obligation to indemnify the directors of GCCM and AMI. It is not necessary at this stage to consider those claims because the parties agreed that a consideration of those issues will follow from the decision in relation to the liability of the first four respondents.
Despite the existence of the contractual claims in the Statement of Claim, little attention was focussed upon them in either the written or oral submissions. The reason appears to be the vendor of the vessel was AMI (as I find below), which is now in liquidation and it may be the parties believe that any liability for breach of contract is not covered by any policies of insurance. There is no need to speculate on why the claim was only faintly advanced.
The claim for misleading or deceptive conduct
An important aspect of the misleading or deceptive conduct claim concerns the attribution of liability to the corporate entities for statements made by Ryan and Dean. It is apparent the applicants wish to sheet home liability to GCCM because they are unlikely to obtain satisfaction from AMI. Conversely, the respondents appear somewhat content to allow AMI to be found liable for breach of contract and the resulting damage because it has no assets.
It does not seem to be in doubt that, at all material times, Ryan was the shipyard manager employed by GCCM. Dean was a director of that company and was also the principal dealer of Leigh-Smith Cruiser Sales. Leigh-Smith Cruiser Sales was the name under which AMI carried on business. The applicants assert that, in fact, the businesses of importing and selling vessels and of operating the marina were undertaken by AMI and of GCCM together without any real distinction. They submit that it follows any representation made by Ryan or Dean, either orally or in writing, was attributable to GCCM as well as AMI. Although there is substantial force in the applicants’ submission in this respect, it is not necessary to reach any final conclusion on that point. It would be sufficient for the applicants’ purposes if Ryan had authority from GCCM to make representations on its behalf. This issue is discussed below.
Were the representations made?
The applicants advanced their case in this respect on two bases. First, that express representations were made to the effect alleged and, second, that the representations arose over the whole of the conduct particularised.
The foundation of the discussions between the applicants and the respondents
Although disputed by the respondents, the foundation upon which the applicants, primarily, Mr Wyzenbeek, and the respondents, primarily, Dean and Ryan, negotiated was that the vessel Mr Wyzenbeek wished to acquire would be capable of trans-ocean crossings, or extended ocean voyaging. Ultimately, both Dean and Ryan accepted they were aware that these were the purposes for which Mr and Mrs Wyzenbeek wished to use any motor launch they acquired. Despite the fact that, in the course of his oral evidence, Mr Wyzenbeek was at pains to advance his case in this respect at every opportunity and, to that extent, he was somewhat dissembling, I nevertheless find he did inform Dean and Ryan that the purposes for which he wished to use any vessel acquired from them was for trans-ocean travel or extended ocean voyaging, including global circumnavigation. As the facts which are set out above reveal, this was the foundation of the Wyzenbeeks’ desire to obtain a replacement for Swanky which, itself, was a Category A vessel. It can be readily accepted that Mr Wyzenbeek indicated his desire to continue his circumnavigation of the world, being a venture which he had commenced in 1999. His advice to Ryan and Dean in this respect was buttressed by the specifications which he required for the vessel. Of significance was the requirement for the inclusion of long range fuel tanks and long running engines. Whilst it is true long range travel does not necessarily mean trans-ocean travel, it is undoubtedly true that such equipment is essential for trans-ocean travel. Moreover, in September 2009, when Mr Wyzenbeek first became serious about replacing Swanky, he sent to Dean his list of specifications. Those specifications specifically referred to an “open ocean Category A trawler”. The reference to Category A was a reference to an oceangoing vessel within the meaning of a “Category A vessel” as described in the CE Directive and a fairly clear indication of the type of vessel Mr Wyzenbeek was pursuing. Despite that, it must be acknowledged the reference to this requirement was not always clearly maintained although its occasional absence was not something noticed by Ryan or Dean.
In 2010, neither Dean nor Ryan understood the meaning of the classification “Category A” when used to describe vessels. That was somewhat startling given they were both involved in the sale of large ocean going vessels. The evidence adduced in this matter indicates neither of them had any reasonable level of knowledge of the requirements for ocean going vessels despite the fact that they purported to sell vessels as such. They either feigned knowledge of such matters or, ignorantly, believed they had sufficient knowledge and were prepared to give their imprimatur to the ocean going attributes of the Hampton range of vessels. In these circumstances, it is not surprising they made the representations they did.
Representations made by Dean
In the course of his evidence, Dean acknowledged he understood Mr Wyzenbeek was in the market for a vessel to replace Swanky that would be fit for use in the open ocean and for crossing oceans. There was no evidence, and nor was it suggested, Dean indicated to Mr Wyzenbeek that the vessels he was offering for sale were not capable of ocean going passage. On the contrary, the identified communications show he indicated that any of the vessels in the Hampton range which he was proffering would be suitable for Mr Wyzenbeek’s needs. The attempt by the respondents to suggest no specific representation was made about the Endurance 750 was, in the circumstances, somewhat disingenuous.
Mr Wyzenbeek gave evidence that, on or around 15 October 2009, he spoke to Dean by telephone about the list of specifications he had provided. His evidence was Dean said words to the effect that he had received the specifications and could make a vessel to suit Mr Wyzenbeek’s purposes which would be suitable for trans-ocean crossings. Dean did not recall such a conversation. Despite that, I accept it occurred as Mr Wyzenbeek related it although, of itself, it does not have significant weight given the stage of discussions and the generality of comment made. Nevertheless, it established the context in which future discussions took place. Shortly afterwards, by the email of 15 October 2009, Dean gave his imprimatur to the quality of the Hampton vessels. His comment in that email about working with his engineers on the vessel to ensure that “every boat is 100% right prior to departing the factory”, represented both a deep involvement in the construction of the vessel and a claim by him that it would be suitable to the customer’s requirements. That was emphasised by his comments extolling the high quality and turnout of the Hampton vessels. This email demonstrated, from a very early stage, Dean was averring the veracity of the information being given to the Wyzenbeeks about the quality of the Hampton vessels. Indeed, to an extent he and the companies which he represented, were taking credit for the quality of the vessel produced. He was representing the information about Hampton yachts provided by him came with his endorsement. In the email of 15 October 2009, (which included a commentary about the Endurance Passagemaker Series from Mr Apollonio), various additional statements were made by Dean as to the capabilities of the Hampton Endurance Series. In particular, that they met very high standards of construction and stability and were capable of being used for extended passage making in open ocean service.
Similarly, in his email of 28 October 2009 at 2.38pm, Dean effectively endorsed the comments of Mr Apollonio as to the suitability of the Hampton range of vessels to meet the requirements of Mr and Mrs Wyzenbeek. Although to some extent he was here merely passing on Mr Apollonio’s comments, his assertion that those comments were “very positive & I hope highlight the ‘facts’ pertaining to handling of Endurance”, indicates his support for them. In his comments Mr Apollonio had said the Hampton vessels were “considered capable of handling anything that comes along in a long ocean voyage”.
The context in which these emails passed between Dean and the Wyzenbeeks included other emails which reveal Dean’s awareness of the Wyzenbeeks’ requirement that any vessel acquired be suitable for trans-ocean crossings. That is especially so of Ryan’s email to him on 16 November 2009, which identified that Mr Wyzenbeek wanted a vessel with an A1 offshore rating and long range fuel tanks to be delivered in Shanghai and, further, that the vessel was to be equipped with the major spares required for immediate ocean crossing. Dean passed the specification requirements on to Mr Chen and, in doing so, emphasised the A1 offshore rating.
By a further email on 25 November 2009 from Dean to Mr and Mrs Wyzenbeek, he indicated that the Endurance 750 (being 68ft extended by 7ft) was a vessel which accommodated all of the Wyzenbeeks’ requirements at that point. The substance of that email was a quotation for the sale of a vessel at $USD 2,475,000 which was said to be a discounted price. One reason for the discount was it would not be subject to GST and Australian duties because Mr and Mrs Wyzenbeek were intending take delivery ex-Shanghai, immediately engage in an ocean crossing, and then remain off shore for two years. This vessel was offered by Dean as being “the ideal option for your vessel & its (sic) requirements” and as being “ideally suited to your requirements” which Dean knew to be trans-ocean crossings and extended ocean voyages. This was apparent from the face of the email and was accepted by Dean during cross-examination. It was a further representation that the Endurance vessels (especially those of around 68ft) were suitable for trans-ocean crossings. That is consistent with Dean’s subsequent email to Mr Chen on 19 September 2011, which noted he sold “every Endurance as being capable of ‘trans ocean crossings’”. By the email of 25 November 2009, Dean did note that he was still awaiting confirmation of the A1 offshore rating to be supplied with the vessel. However, he also indicated that obtaining relevant guarantees would not be a major issue.
In response to the email of 25 November, the following day Mr Wyzenbeek sent to Dean what was said to be a list of questions but was, in fact, a list of vessel specifications. It seems they were taken from the Marlow Yachts website and were a vague indication that Mr Wyzenbeek wished those items to be included on the Endurance 750.
Dean responded with an email on 27 November 2009, attaching the specifications for the Endurance 750 and indicating that it appears that Mr Wyzenbeek wanted a cross-check of the two specification lists. Dean indicated that it was essential for him to arrange a meeting at GCCM with the Wyzenbeeks and his two engineers so that they could work through the specifications identified by Mr Wyzenbeek and identify which ones were relevant and capable of being fitted to an Endurance yacht.
On 1 December 2009 Dean sent an email to Mr Wyzenbeek which included a response from Mr Chen as to the A1 Offshore rating. Mr Chen’s response was of limited utility because it merely related to stability rather than the vessel generally. That said, it did not appear Dean understood this and apprehended the rating related to the whole of the vessel. In any event Dean reiterated his erstwhile offer to get the vessel ready for trans-ocean crossing. He said:
As for the remainder of the specifications you sent us last week I would still propose that we sit down with you & my two engineers to discuss the full vessel inventory from bow to stern & ensure we have the best equipment on the vessel taking into account the trans-ocean crossing you will be undertaking with it before entering back to Australian waters at which point we will finalise suitable importation paper for an Australian vessel in conjunction with our company.
That email is relied upon by the applicants as Dean reiterating and confirming the suitability of the vessel to engage in passage across oceans. It can be readily accepted that was, in fact, what Dean was doing.
It was not until after the Port Macquarie incident that Dean eventually acknowledged the vessel was not suitable for trans-ocean crossing. Prior to then he was a party to subsequent email correspondence between Ryan and the Wyzenbeeks in which the ocean going capacity of the vessel was discussed and he did not demur to any of the suggestions that the vessel was so suited. Indeed, comments he made after the vessel was sold to the Wyzenbeeks are consistent with having that opinion. He appeared on a television program referred to as “Creek to Coast” in which he expressed his confidence in the vessel purchased by the Wyzenbeeks and stated it was a trans-Atlantic vessel, capable of doing around-the-world cruising. Dean gave evidence that this statement was based upon knowledge he acquired prior to his communications with Mr Wyzenbeek and this heightens confidence in the conclusion he had made similar statements to Mr Wyzenbeek prior to the vessel being purchased. The statement is also indicative of Dean’s position that he, himself, could give his imprimatur to the quality of the vessel and he was not merely passing on information. Whilst under cross-examination he claimed there was some “salesmanship” in that statement, Counsel for the applicants submitted that there is no reason that such salesmanship would not have been engaged in with Mr Wyzenbeek and that ought to be accepted.
It might be observed that a degree of recklessness is involved in engaging in “salesmanship” when the topic being discussed is the ability of a vessel to engage in open ocean travel or travel across oceans. Any attempted “salesmanship”, which I take to be a euphemism for “overstatement” or making misleading statements, in relation to the seakeeping capacities of a vessel is fraught with danger. Sea conditions on the open ocean can change dramatically and quickly and a vessel which is not constructed to standards which permit it to withstand the most serious of conditions will flounder and put the lives of crew and passengers at peril. Such comments can apply equally to vessels intended to be used for coastal service only. The sea conditions of coastal waters can also change rapidly and significantly and any overstatement as to the seakeeping abilities of such vessels is likely to render users overconfident as to their capabilities in dangerous conditions.
As has been indicated, the conclusion that Dean made the representations to Mr Wyzenbeek that the Endurance range of vessels were capable of trans-ocean crossing is strongly supported by his email in September 2011 to Mr Chen of Hampton Yachts wherein he stated that, “We sell every Endurance as being capable of trans ocean crossings”. On its face, that comment is confirmatory of Mr Wyzenbeek’s allegation. Although Dean said in evidence that there was also some “salesmanship” in that statement and he was lying to Mr Chen so that he could secure a benefit for Mr Wyzenbeek, I do not accept his oral evidence in this regard. There is no reason to believe that he did not regard the vessel as being capable of trans-ocean crossing. Indeed, he had represented that to Mr Wyzenbeek on a number of occasions. He was an extremely poor witness who was prone to give dissembling answers.
The applicants also pointed to a number of other matters to support the conclusion that Dean made the representations alleged. Amongst them is that on 9 March 2011, Ryan sent an email to Mr Chen seeking builder’s certificates for two 750 Endurance vessels including Cadeau. He wanted them so that the vessels could travel internationally. That email was copied to Dean and there appears to have been no response from Dean to suggest that the vessels would not be suitable for engaging in international travel. In addition, in his evidence Dean acknowledged that he did tell Mr Wyzenbeek that the engines in the vessel would be commercially rated. That being so, they would run for much longer than pleasure craft engines and that was important for trans-ocean crossings.
Given the above, it is apparent that Dean made both oral and written representations to Mr Wyzenbeek to the effect that the Endurance 750 motor vessel he was to acquire was suitable for trans-ocean crossings or extended ocean voyaging. He did so for his own benefit in that he would personally obtain a share of the commission for the sale of the vessel. He also did so on behalf of AMI. As is discussed below, he also made the representations on behalf of GCCM.
Representations by Ryan
In the course of his cross-examination, Ryan acknowledged that, prior to the sale of the vessel, he had told Mr Wyzenbeek the Hampton range of vessels was suitable for crossing oceans. He also acknowledged that, from his point of view, this capability was a selling point for the Hampton Endurance range. He, like Dean, had no reasonable basis for making that statement and it was equally reckless of him to do so. Although in the defence the respondents denied Ryan made any of the alleged representations, it is clear he did. The reason for those denials when the converse was so readily admitted by Ryan has not been explained.
From an early stage Ryan sought to be involved in the attempt to sell an Endurance vessel to Mr Wyzenbeek. His involvement in any sale would secure payment to him of some portion of the commission. He provided Mr Wyzenbeek with the Hampton Yacht’s brochure, to which he had stapled his GCCM business card and it identified him as an employee of that company. Although the brochure made positive statements as to the seakeeping abilities of the Endurance range, it did not expressly assert they were capable of being used to cross oceans. The statements made in those brochures might equally be taken as asserting their ability or suitability to engage in coastal cruising. Nevertheless, the import of Ryan’s actions was that he sought to cause the sale of the vessel to Mr Wyzenbeek in his capacity as an employee of GCCM. Dean and, more generally, GCCM were aware of Ryan’s activities and permitted them to occur. It was an accepted part of Dean’s duties in the course of his employment with GCCM, to participate in attempting to sell boats as part of AMI’s business.
Ryan was well aware of the Wyzenbeeks’ requirement for a vessel suitable for trans-ocean travel. He was also aware of, and party to, much of the email correspondence between Dean and the Wyzenbeeks which promoted the seakeeping abilities of the Endurance range as being suitable for crossing oceans. He said nothing to dispel the suggestion that the vessels in the range would not be suitable for their requirements. He, like Dean, also promoted the supply to Mr Wyzenbeek of a vessel which was not merely one constructed by Hampton Yachts. By an email of 27 January 2010, he encouraged Mr Wyzenbeek to meet with himself and persons he said were his engineers to discuss and formulate a “package” which would be put together for the purposes of meeting Mr Wyzenbeek’s requirements. At that time he was aware that Mr Wyzenbeek needed the vessel with a range of around 3,000nm and that Mr Wyzenbeek wanted to use it for ocean voyaging including trans-ocean crossings. That is evidenced by his email to Mr Chen of 15 February 2010, in which he identified that whilst Mr Wyzenbeek had been looking at the Marlow range of vessels he, Ryan, had convinced him “to look at the Endurance range”. He added that Mr Wyzenbeek had provided some specifications for what he wanted from an Endurance vessel and added the rider that Mr Wyzenbeek needed a fully commissioned vessel ex-factory, to be delivered to him in Shanghai and immediately taken on a substantial ocean crossing. This email removes any doubt that Ryan was aware that the Wyzenbeeks were looking for a vessel suitable for crossing oceans and it is clear he dealt with them on that basis. That was confirmed by Ryan’s email on 17 February 2010, referred to above, wherein he indicated he was “serious about selling ocean going vessels”.
Under cross-examination from Mr Robertson, Counsel for the sixth respondent, Mr Lack admitted he was not able to apply his methodology if the evidence of price was limited to one comparative vessel (ts 782–783). On that basis, his evidence as to the value of Cadeau must be rejected. When the evidence of Sales 5 and 6 are excluded, as they must be, there was insufficient evidence of comparative values for Mr Lack to apply any methodology which was suited to the valuing of Cadeau.
It follows that there was no evidence of the value of Cadeau at the date of trial on which the Astonland measure could be applied, even assuming that it would be an appropriate method.
It is relevant that a large part of Mr Lack’s valuation of Cadeau was based upon vessels of this nature depreciating at a significant rate. The values of other vessels which he sought to use for comparison purposes were the depreciated values and his purported valuation of Cadeau was calculated on the basis that its value had declined due to use and the ordinary effect of the passage of time. He said that the reasonable useful life of a vessel of this nature is 25 years though he did not indicate whether the rate of depreciation was constant or, as might normally be expected for such goods, occurred at a faster rate during the early years and then tailed off over time.
In any event, the purpose of the valuation was to support the application of the Astonland measure of loss by reference to the value of Cadeau at the date of the trial. On that basis they sought to recover as part of the damage allegedly caused by the representations, the depreciation in the value of the vessel which has been used constantly since it was acquired in 2011. In effect, they wish to be put into the economic position whereby they may, after seven years of boating in Cadeau, have the equivalent of a new ocean going vessel. It is relevant that they also seek interest on the award of damages from 2011. This analysis demonstrates just how inapplicable the Astonland measure is in the present circumstances and if it were used it would vastly overcompensate the applicants.
The counterfactual negates any loss
A possible alternative manner of considering the position is to identify the counterfactual position was that the Wyzenbeeks would have acquired some other vessel of a similar description. Mr Giles rightly submitted that this was not expressly pleaded in the defences although it was an issue litigated and in respect of which a finding can legitimately be made: Banque Commerciale SA, En Liquidation v Akhil Holdings Ltd (1990) 169 CLR 279; Holdway v Arcuri Lawyers (a firm) [2009] 2 Qd R 18 at 43–44 [60]–[61]. Mr Wyzenbeek’s own evidence was that he wanted to acquire a large motor yacht of around the 65ft plus range to continue his boating pursuits. His evidence was that he would have acquired some other vessel, probably a Marlow Yacht, if he had not purchased Cadeau. It would be blatantly shutting one’s eyes to the obvious if that were ignored. Indeed, it was even acknowledged by the applicants that this was the case.
On that basis, if the depreciation in the value of Cadeau was loss suffered by Mr and Mrs Wyzenbeek, any assessment of damages to put the applicants into the economic position which they would have been had the representations not been made, would necessarily take into account that the vessel which they would otherwise have acquired in 2011 (which was suitable for trans-ocean travel) would had aged and depreciated in value as had Cadeau. There is nothing to suggest the Wyzenbeeks would not have used any such vessel less extensively than they have used Cadeau over the past seven years and, therefore, it too would have depreciated at generally the same rate. This demonstrates the fallacy of the applicants’ attempt to secure as damages an amount equivalent to Cadeau’s depreciation over time.
Other damages claimed
The applicants also claim as damages in relation to the s 52 claim (or the s 18 claim) the amounts which they have expended on the purchase, repair or rectification of Cadeau over time. They claim (at para 78 of their written submissions) that they are entitled to recover:
all amounts expended on Cadeau to date, including expenses involved in purchasing Cadeau, expenses involved in rectifying, repairing and upgrading Cadeau and some other incidental expenses on the basis that had the misleading and deceptive conduct not occurred, the vessel would not have been purchased and such amounts would not have been expended on it.
The total amount is identified as $4,896,765.50.
These damages are sought on the basis that once the value of the vessel at the time of trial is deducted from that amount, the remaining deficit will reflect their loss. Given the conclusion that Astonland method of assessment is not appropriate in this case, it is possibly not technically necessary to consider this issue, however, in deference to the submissions made it is appropriate to make findings as to their veracity.
A number of issues were raised by the respondents with respect to the variously claimed items of damages although, ultimately, not all of them were examined in the course of the hearing. That is not a criticism and the issues raised by the cross-examination of Mr Wyzenbeek, revealed that the expenditure claimed could not be regarded as a loss let alone a loss caused by the misleading conduct. I deal with some of these as follows:
(a)Mr Wyzenbeek made a claim for an amount of $3,419.60 for a life raft and an additional amount for a cradle for the raft which was affixed to Cadeau. Initially he acquired the life raft for use on Swanky but it seems that they were subsequently used on Cadeau. However, herein lies the difficulty. Both the life raft and the cradle were purchased and have been used by the Wyzenbeeks. They have not suffered the loss of the expenditure by reason of entering into the transaction. First, they have had the use and benefit of that expenditure over the six or seven years since Cadeau was acquired and they will continue to have the use of it. If they sell Cadeau “lock, stock and barrel” they will recover an amount attributable to the residual value of these items. Secondly, on the counterfactual scenario, similar expenses would have been incurred and the benefit from those expenses would have been derived.
(b)Similarly, an item for freezer baskets is claimed by Mr Wyzenbeek. These were utilised in the freezers on Cadeau. Again, such baskets were used for the past seven years by the applicants, and will they will probably continue to use them for as long as they own the vessel. They have suffered no loss by acquiring and using such items. Moreover, it is probable that items of a similar nature would have been acquired for use on any other vessel purchased.
(c)Other expenses identified included the upgrading of aspects of Cadeau. Reference was specifically made to the upgrading of shades from manual operation to motorised operation. Again, such expenses were incurred by the Wyzenbeeks for their own benefit, they have utilised those items over the years and they retain the residual benefit of that expenditure. Again, in no way could such expenditure be said to have been caused by or arisen because of the misrepresentations and it cannot be said they have suffered loss as a result of the expenditure.
(d)A question was raised as to the cost of batteries on Cadeau. Initially, Mr Wyzenbeek agreed to pay for the batteries at the time of acquiring the vessel. The applicants claim this as an amount which would not have been expended had Cadeau not been purchased. Again, the applicants apply the simple “but for” test of causation in relation to this item of damage. That is not a correct method of identifying damages for this type of claim as the alleged loss sought is not related to the alleged misrepresentation. Moreover, the same position applies as has been identified above. The Wyzenbeeks have had the benefit of the batteries over seven years and, it is also most likely that had they not acquired these batteries they would have had to have acquired other batteries for use in a different vessel. It was also said that the batteries were defective and had to be replaced because of problems with the electrics and batteries in Cadeau. That fact became known at a later date. However, that alleged loss is not a loss that was caused by the misrepresentation or connected with it.
A number of other matters should be said of the list of claimed costs and damages. First, a large number of them are for costs and expenses which were expended on Cadeau after the Port Macquarie incident. It is to be recalled that, on the day after that incident, Mr Wyzenbeek was informed by Dean that Cadeau was not a vessel suitable for trans-ocean travel. Although some attempt was made to diminish the impact of this statement, it was sufficient to remove the falsity of the representations which had previously been made. From that point on it would appear that the misrepresentations had ceased to have any effect whatsoever. The position in relation to the expenses incurred thereafter is that they were incurred on Cadeau in the full knowledge that she was not a trans-ocean going vessel. For whatever reason those amounts were expended, it was not because they were caused by the misrepresentations.
Secondly, as with the expenses referred to above, from the limited information available, it is clear that they were incurred in making improvements to or repairs to Cadeau. That expenditure was “used up” or continues to be used up by the Wyzenbeeks in their subsequent and continuing use of the vessel. Like the vessel itself, both time and use will diminish their value. One might expect in relation to many of these costs that had the Wyzenbeeks acquired a different vessel, even one of trans-ocean going ability, they would have expended similar amounts on similar items. Even if it were assumed that such expenses were in some way justified as being consequential upon the acquisition of Cadeau in reliance upon the representations, the applicants’ claim for them only go to show that the Astonland measure of assessing damages in a case of this nature is inapposite. Indeed, one would doubt its applicability in any case where the acquisition in question was of, and was intended to be of, a depreciating asset. Whilst Cadeau did not have all of the qualities which the Wyzenbeeks wished, they have made use of it and enjoyed it over the past seven years. Their travel on it has been extensive. There is nothing in the TPA or the ACL which would justify an award of damages which included the costs of operating, repairing, upgrading and maintaining a vessel over the years whilst it is being used. Indeed, the evidence before the Court was that, in the ordinary course, a vessel of this nature costs approximately $100,000 a year to repair and maintain and Mr Wyzenbeek has sought to impose that liability on the respondents.
Thirdly, the evidential process by which the applicants asked the Court to assess damages was inappropriate. A schedule of the items of damages claimed was handed to the Court with the written submissions. It contained, in relation to each item, information as to the provider, invoice number, date of invoice, total amount invoiced and the evidence reference number. That latter is a reference to a document or documents in the tender bundle which often turned out to be a tax invoice. Whilst some of the invoices provided a brief description of the work done, the need for the work was not identified and nor was there any indication that the work was reasonably required. This is an inappropriate way to attempt to prove a damages case and, to a large extent, it requires the Court to speculate about a number of the above matters.
Conclusion on individual items
It follows that the applicants have failed to establish that the costs in relation to the extensive list of individual repairs, improvements, additions, and modifications to Cadeau are amounts which they are entitled to recover as damages. If anything, the attempt also reveals how inappropriate the Astonland measure is in a case like this. Moreover, the suggestion that a court ought be required to trawl through hundreds of bank account statements, invoices and the like and to decipher various entries therein for the purposes of ascertaining the purpose, nature and extent of expenditure, even if that could be done, is inappropriate.
The applicants’ submissions made constant reference to the decision in Barclay v English [2009] QSC 258 which, in part, resembled the facts of this case. I have referred to the difficulties with that decision above. A Lyons J seemingly applied a methodology which was neither the Potts v Miller methodology nor the Astonland methodology. Her Honour did not start with the purchase price of the vessel and then deduct the value of the vessel remaining in the hands of the purchaser. Her Honour started with the figure representing the total amount spent on the vessel. That included a significant amount expended by the purchaser after acquisition of the vessel in order to put the vessel into the condition it would have been had the representation been true. In other words, the assessment clearly included “expectation” losses. That was not inappropriate in relation to the breach of contract claim which the plaintiff pursued in that action, but it was not relevant to the claim under s 52 of the TPA. Again, it should be emphasised that her Honour was not assisted by any reference to the authorities dealing with Potts v Miller or Astonland or the issues surrounding the appropriate measure of loss in these circumstances. The applicants’ reliance Barclay v English is misplaced.
Loss of use
The applicants make a claim for loss of use of the vessel. In doing so they rely upon the various authorities collected in Vautin (No 4) [2018] FCA 426 [310]–[316]. However, here, the claim for loss of use, whilst appropriate in the contractual claim, has no place in the damages claim under the TPA or ACL. The claim relates to some 664 days during which the vessel was laid up for repairs. There is nothing in the evidence to suggest that the repairs were consequential upon the misleading representations. In attempting to make them part of the TPA/ACL claim the applicants seek to adopt a “but for” test when identifying the claimable amounts. As the authorities identified above have shown, that is a necessary requirement but it is not sufficient. Here it has not been shown that the wide range of repairs undertaken on Cadeau were consequential upon anything but its acquisition.
Conclusion on ACL/TPA claim
It follows that the applicants have failed to establish that they or any of them have suffered loss or damage which was caused by or arose because of the alleged contravention of s 18 of the ACL or s 52 of the TPA. Their actions in this respect must be dismissed.
Claim for breach of contract
The contract of purchase was entered into on or around 9 or 10 September 2010. Mr Wyzenbeek sought to agitate that it was entered into on 14 September 2010 although nothing really turns on this. The respondents appeared to suggest that Mr Wyzenbeek engaged in certain post-contractual “negotiations” in the period from 10 to 14 September, whereby he sought additional terms in relation to guarantees and the payment schedule. The point adduced was a credit one; namely that Mr Wyzenbeek was a person who was not prepared to be bound by the terms of agreements into which he entered. There is force in that submission and it did appear that Mr Wyzenbeek sought to gain additional advantages from AMI once the agreement had been struck. Whilst that does not reflect well on him, it does show that he was a canny businessman and that gives support for the earlier finding that it is most unlikely that he paid more for Cadeau than it was worth.
Parties to the contract of sale
On the contract of sale as it was ultimately varied, the broker was identified as Leigh-Smith Cruiser Sales, the seller was identified as AMI and the purchasers were identified as Mr and Mrs Wyzenbeek. The applicants assert that GCCM was also a party to the contract. They do so by identifying that in the contract schedule under the name Leigh-Smith Cruiser Sales, appears an ABN number, “ABN: 42 083 695 283”, which belongs to GCCM. Ryan gave evidence that this had occurred by reason of an office assistant accidently inserting the wrong ABN into the pro forma contract. No objection was taken to that evidence and it can be accepted.
In the circumstances it is difficult to reach the conclusion that GCCM was intended to be the seller or the broker. Importantly, it is usual for parties to a contract to identify the contracting entities by their names. In this case there is no suggestion that GCCM was a named party. It would appear that the contract terms were proffered to Mr and Mrs Wyzenbeek as a contract in which AMI was the seller and Leigh-Smith Cruiser Sales was identified as the broker. It is not likely that any party considered that GCCM was a participant in the agreement. Objectively, there is nothing to suggest that any reasonable person would have considered GCCM to be a party: Lederberger and Scheiner v Mediterranean Olives Financial Pty Ltd (2012) 38 VR 509 at 516–517 [19].
The applicants submitted the broker and the seller could not be the same entity for the purposes of the contract. There is no reason why that is so despite the applicants submitting that it was illogical or a nonsense. They did not refer to any contractual clauses which would render it impossible, or even difficult in performance, if AMI were both the broker and the seller. Although the terms of the contract refer to the “broker” and “seller” separately, there is nothing in their operation which suggests that they have to be different entities.
The applicants further submitted that Mr Wyzenbeek was told that AMI and LSCS were different “arms” of GCCM. To the extent to which Mr Wyzenbeek was told any such thing it does not make any difference to the conclusions in this regard. Any representation relating to those matters was vague and did not convey a statement that the various corporations were one-and-the-same entity. Indeed, Mr Wyzenbeek who, himself, was a director of many companies, may well have been of the impression that the selling and broking entities were subsidiaries of GCCM which was not a party to the agreement.
The applicants also submitted that Ryan had informed Mr Wyzenbeek that director’s guarantees could be offered from GCCM and AMI and that GCCM was the substantial asset owner in the group. It is also said that Ryan told Mr Wyzenbeek that AMI was the trading company for importing the vessel. These statements were said to have been made on 14 September 2010 and, on the applicants’ case, prior to the contract being finalised. However, if they were made, the statement that AMI was the trading company for importing the vessel must have given Mr Wyzenbeek a clear indication that it was separate to GCCM and was the entity which would sell him the vessel.
On the facts, there is nothing in the objective circumstances known to the parties at the time which would suggest that GCCM was a party to the contract. The misadventure of the inclusion of the wrong ABN was not, apparently, known at the time and it was not suggested otherwise.
GCCM as broker?
In any event, even if GCCM were the “broker”, that would not bind it to the terms of the agreement. GCCM did not execute the agreement. It was only executed by AMI as the “seller” and by Mr Wyzenbeek on behalf of the purchasers. There was, in fact, no signature clause for the broker. More importantly, the broker did not assume any obligations under the agreement. Whilst cl 6 may be a clause which was agreed upon for the benefit of a third party to the contract, as is cl 9, there does not appear to be any covenant by the broker to perform any obligation.
It follows that even if GCCM were the broker for the purposes of the transaction, it would not be liable as the supplier of the vessel under the terms of the contract of sale.
Representation as to fitness for purpose
Ryan and Dean both made representations to the effect that Cadeau or an Endurance 750 vessel (or an Endurance 650 for that matter) would be suitable for crossing oceans or for extended passage in the open ocean and the circumstances were such that they were aware that Mr and Mrs Wyzenbeek would rely on them in this respect. The discussions between the parties proceeded on that basis and the respondents’ various representations that the vessel would be so suitable were representations as to its quality and purpose. Their knowledge of the purpose for which the vessel was required, was also knowledge of AMI.
The respondents submitted there was no specification in the contract the vessel would be suitable for crossing oceans or extended open ocean passage in the contract. Whilst that is true, it adds little because the vessel was promoted as having that capacity and, indeed, some of the specifications were designed around it.
It follows that a term pursuant to s 71(2) of the TPA was implied into the contract for the supply of Cadeau that it was reasonably fit for the purpose of crossing oceans or extended open ocean passage. That prima facie implication can be rebutted if the circumstances are such as to show that the consumer did not rely on the skill and judgment of the seller. But here, whilst Mr Wyzenbeek was anxious to have close involvement in the specifications of the vessel, his knowledge was not such that he would have been aware of its suitability for crossing oceans or extended open ocean passage. That was principally a matter of its design and construction and there is no suggestion that he had any knowledge or understanding of these things. On the other hand, both Ryan and Dean admitted to making the representations in relation to the vessel in the course of promoting it to Mr Wyzenbeek because they believed the statements to be selling points. This tends to suggest an assumption of responsibility by them for the accuracy of the representations and the circumstances were such that they were aware that Mr Wyzenbeek relied upon their observations as to the quality of that range of vessel and their suitability for the disclosed use. The respondents, or some of them, obviously had a close arrangement with Hampton Yachts in relation to the Endurance vessels and they might be expected to know the capability of the vessels. Reference has been made previously to the occasions when Ryan and Dean identified themselves as being integral to the preparation with the vessel along with their engineers. They sought to promote their involvement with it as contributing to its quality. Again, this adds to the reasonableness of the Wyzenbeeks reliance upon their skill and judgment. Further still, it is apparent from their business as boat brokers that Ryan and Dean held themselves out as being knowledgeable in the area.
Although some clauses of the contract of sale purport to negate the effect of s 71(2), they are void to that extent. See s 68(1) of the TPA.
Cadeau was not fit for purpose
On the basis of the findings which have been made above, the vessel supplied to the Wyzenbeeks was not fit for the purpose of being used for trans-ocean passage or extended passage in the open ocean. It was not suitable for those uses and, in fact, the absence of compliance with any internationally recognised standard for the construction of vessels which might be used for those purposes, renders that fact almost axiomatic: Vautin (No 4) at [182]–[195].
It has also been found that Cadeau was not fit for the purpose of crossing oceans because of the inadequate port lights, inadequately secured Portuguese doors and the insufficient strength of the cabin glass. Whilst it may be that its hull design and construction would also have rendered it unfit for those purposes, that was not agitated and no case or claim for damages is founded upon that proposition.
One difficulty with the applicants’ pleaded case is that the breach of the implied term of fitness for purpose was the only breach relied upon for the purposes of their contractual damages claim. The claim founded on the allegation the vessel was not of merchantable quality was abandoned. Such a claim may have entitled the applicants to recover the cost of repairing a number of the relatively minor defects in Cadeau which were not related to its suitability for crossing oceans, but that need not now be considered.
The other difficulty is that the pleaded case does not make any attempt to precisely identify the manner in which the claimed damage has flowed from the breach of the implied term of fitness for purpose. It uses the generalised statement of causation that “as a result of” the breach of the term the applicants suffered loss and damage. The alleged particulars are:
i. Cost of repairing defects;
ii. Costs of and incidental to repairing and rectifying the Vessel;
iii. Costs of rendering the Vessel closer to fitness for the purpose for which it was purchased;
iv. Diminution in value of the Vessel in other words the difference between the cost of the vessel and its present value; and
v. Loss of use; and
vi. The damages as further particularised in the substitute Schedule of Damages provided to the Court in Applicants’ opening oral submissions.
The plea of causation is inadequate in that it makes no attempt to connect the claimed damages with the breach save, perhaps, for item (ii). Even then there is no indication in the remainder of the pleading or the written submissions of what costs were expended in rendering the vessel closer to the contractual requirement. The schedule of damages did not assist and nor did the oral submissions. A schedule ultimately relied upon by the applicants was annexed to their final written submissions. Again, it was of limited use and the headings used in it were difficult to follow.
Nevertheless, the evidence disclosed that had the port lights been of an appropriate quality and appropriately installed such that they met the requirements of an ocean crossing vessel it is apparent they would not have leaked as they did. Similarly, as Mr Dovell’s report disclosed, the Port Macquarie incident revealed the Portuguese doors and the cabin window glass were not of a quality required in an ocean going vessel. Had those items been of an appropriate quality and strength to withstand conditions which might be encountered at sea, they would not have failed as they did during the Port Macquarie incident. It follows that the damage which flowed from those defects was the result of the vessel not being fit for its purpose, even though the damage was not sustained while the vessel was crossing an ocean.
Damages for breach of contract
The measure of damages for the contractual claim founded upon the breach of the statutory implied term is to compensate the applicants, so far as money can do it, by putting them in the position they would be had the contract been performed. In nearly all cases the assessment of damages, excluding consequential losses, takes place as at the date of contract.
Here no evidence was called as to the amount of money which would have to be expended by the Wyzenbeeks to render Cadeau suitable for open ocean travel. Whilst Mr Dovell identified three aspects in which the vessel was not suitable for open ocean travel (the port lights, the strength of the glass and the Portuguese doors) he did not venture further to identify how the vessel could be put into a condition whereby it would be suitable. That would have necessitated a consideration of the design drawings for the vessel and a consideration of how it was constructed.
If one were left to assume that the vessel was suitable for open ocean travel, or more suitable for open ocean travel if the port lights, the glass and the Portuguese doors were improved, some measure of damages on this account might be identifiable. However, the port lights were repaired and replaced under warranty by Hampton Yachts and so no amount is recoverable in that respect. Further, it seems that the cost of repairing and upgrading the Portuguese doors and the cabin glass was met by the Wyzenbeeks’ marine insurer and the amount has not been claimed though it might have been, even if any award of damages in this respect would have to be paid to those insurers.
The applicants’ broad claims for damages
The applicants assert that significant amounts of money have been spent on Cadeau to date in purchasing and rectifying it, but the circumstances are such that it could probably not meet the condition of being suitable for open ocean crossings. They submitted that it followed the appropriate measure of damage is the amount of money spent by Mr and Mrs Wyzenbeek on Cadeau less its current value as that will permit them to go elsewhere and acquire a vessel which meets the implied conditions. The totality of their submissions on this point were as follows:
104. The law with regard to contractual damages is well known. In short, damages are to compensate the applicants for the breach of the implied condition, being an amount which reflects what it would cost to ensure that the implied condition was met. Very significant amounts of money have been spent on Cadeau to date both in purchasing and rectifying the vessel but the likelihood is that it cannot meet that condition, given the manner in which it was designed and manufactured. Therefore, the appropriate measure of damage is the money spent by Mr and Mrs Wyzenbeek on Cadeau (less the value of Cadeau currently) so they can go elsewhere and buy a vessel which does meet the implied condition. Therefore, the applicants seek the same damages in respect of their contract claim as the misleading and deceptive conduct claim referred to in Section B.4.3 above.
There is little doubt that the paucity of the submissions on this topic is reflective of the fact that AMI, which is the party liable for the contractual damages, is insolvent and in liquidation and the chance of recovery is remote. Nevertheless, the submissions have been advanced, albeit tentatively, and must be considered.
In the ordinary case, the measure of damage for breach of contract is ascertained, in the first instance, as at the date of the contract. Whilst this might vary in circumstances where certainty as to whether loss is suffered is dependent upon subsequent events, that is not this case. It would have been possible for the applicants, had they so chosen, to call evidence as to the cost, as at the date of the supply, of putting the vessel into a condition which would permit it to engage in open ocean travel. They did not do that. The cost of repairing minor defects in the vessel, modifying it or making improvements are not the costs of putting it into a condition which meets the statutory warranty. At the least, there was no evidence of that.
The applicants’ submission that the vessel could not be put into a state whereby it would be suitable for crossing oceans or extended ocean voyaging is made without any sufficient evidential foundation. The three matters relied upon by Mr Dovell which rendered it unfit for those purposes were the leaking portlights, the inadequate structure of the Portuguese doors and the glass of the forward cabin being of insufficient strength. Those matters have been rectified. Whilst it can be accepted that there is a degree of likelihood that the vessel did not otherwise meet the structural or build requirements of an ocean going vessel that, was not a case agitated by the applicants and the parties did not call evidence in relation to it. Nor was there any evidence to support the conclusion that any other defect was of a nature which rendered the vessel unsuited for the identified purposes. The applicants’ submission in this respect cannot be accepted.
The method of assessing damages as proposed by the applicants has no place in a contractual claim. The true measure of damage is that amount which, so far as money can do it, will put them into the position which they would have been had the contract been performed. If it is the case that Cadeau was not able to be altered to render it suitable for crossing oceans, the measure of damage would be the extra amount of money, if any, which the applicants would have been required to expend at the date of the contract to acquire a 75ft ocean going vessel. There was no evidence of what that amount of money would have been. Otherwise, there is no basis for awarding contractual damages in the manner asserted by the applicants. If, as the applicants submit, Cadeau cannot be made into a vessel suitable for crossing oceans, the money expended by them was not spent for remediating the breach.
Similarly, the losses alleged are not, for the most part, losses which are consequential upon the alleged breach of contract. It has not been shown, save in relation to the three defects identified by Mr Dovell, the repairs and improvements were consequential upon the vessel not being fit for purpose. Additionally, as the above analysis demonstrates, the applicants approach seeks to recover the depreciation in the value of Cadeau, which they have used regularly over the past six or seven years. Such losses are not recoverable under the contractual measure.
Although from time to time in their submissions the applicants claimed much of the work they did on the vessel was for the purposes of making it an oceangoing vessel, that was mere assertion. There has been no identification of the expenses which were necessary to put the vessel into a condition which would make it, or was intended to make it, suitable for crossing oceans or extended open ocean passage.
Loss of use of the vessel
Whilst Cadeau was being repaired from time to time it was not capable of being used by Mr and Mrs Wyzenbeek and the applicants claim damages for their inability to use it during that period. Such damages are recoverable where, as a consequence of a wrong done with respect to a vessel, even a non-profit making vessel, it is laid up for repairs. The authorities on this topic were discussed in detail in Vautin (No 4) at [308]–[317]. Whilst such damages are usually sought in collision cases there is no reason why they would also not be available as consequential losses in claims for breach of contract where repairs or rectification are required to put the vessel into the condition which it ought to have been had the contract been performed. The respondents did not submit to the contrary.
However, here again, the applicants have generally failed to establish with any clarity that the loss of use of the vessel was caused by the breach of the implied contractual term that it was fit for its purpose of being used for crossing oceans. The only exceptions are those periods of time during which repairs were required as a result of the leaking portlights and after the Port Macquarie incident. As has been found, if the vessel were fit for purpose the portlights would not have leaked and the vessel would not have sustained damage when crossing the bar at Port Macquarie due to insufficiently constructed Portuguese doors and cabin windows. In the latter respect, if the Portuguese doors were of adequate construction they would not have detached and would have deflected the waves. Similarly, if the glass around the forward cabin was of sufficient strength it would withstood the force of the waves coming over the bow of the vessel and the damage to the interior would have been averted.
The periods of time during which Cadeau was out of commission for the purposes of effecting repairs which were attributable to the defects which rendered it unfit for the purpose of ocean crossing were 22 days in 2011 (being from 16 August 2011 to 24 August 2011 and from 8 September 2011 to 22 September 2011) and for around eight months from 25 October 2012, being the period immediately after the Port Macquarie incident. When all the evidence is taken into account there was a period of about 9 months in the second year of ownership during which the vessel was out of commission. As appears from the discussion in Vautin (No 4), the often used measure of damages for loss of use during periods of repair is the amount by which the vessel has deteriorated whilst laid up.
In the absence of any other evidence, I take the depreciation rate in respect of Cadeau as being 6%. It would follow that in the second year of service, it would have been worth $3,760,000.00. In broadbrush terms the vessel was out of commission for nine months of the following year. That being so, three quarters of the depreciation sustained by the vessel in that following year ($224,400.00) amounted to $168,300.00.
If the vessel had met the contractual standard and was reasonably fit for crossing oceans and, therefore, did not have the defects identified by Mr Dovell, those defects would not have caused the damage they did and the vessel would not have been out of commission for that nine month period. The loss of the use of the vessel for that time can be compensated by an award of damages in an amount representing the depreciation which occurred while it could not be used. On that basis, Mr and Mrs Wyzenbeek are entitled to damages against AMI in the amount of $168,300.00 representing the only amount of loss proven to have been caused by the breach of the condition that the vessel was not reasonably fit for the purpose of crossing oceans or engaging in extended ocean passage.
Conclusion on contract claim
Given the lack of evidence surrounding the contractual claims against AMI, the only damages which were sustained are those in relation to the loss of use of the vessel. In the result, the first and second applicants should have judgment against the first respondent in the sum of $168,300.00. Interest is payable on that sum from the end of June 2012 and the parties ought to bring in short minutes of the appropriate order as to interest or, in the absence of agreement, the matter will be re-listed.
I certify that the preceding three hundred and thirty-two (332) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Derrington. Associate:
Dated: 10 October 2018
SCHEDULE OF PARTIES
NSD 911 of 2015 Respondents
Fourth Respondent:
RYAN ANTHONY LEIGH-SMITH
Fifth Respondent:
PATRICK VINCENT GAY
Sixth Respondent:
CHUBB INSURANCE AUSTRALIA LTD
Seventh Respondent:
THE UNDERWRITERS OF LLOYDS SYNDICATE 5000 TRV
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