Mortimer v Motorsport Logistics Limited - [2012] NZHC 3180

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV 2011-004-000239 [2012] NZHC 3180

BETWEEN WARWICK JOHN MORTIMER AND LESLEY ERIN MORTIMER IN THEIR PERSONAL CAPACITIES AND AS TRUSTEES OF THE KARAMAROA FAMILY TRUST AND TEKAI INVESTMENTS LIMITED AND MORTIMER MOTOR SPORTS LIMITED First Plaintiffs

ANDSEFTON CLINTON GIBB Second Plaintiff

ANDANTHONY EDWARD LE MESSURIER Third Plaintiff

ANDNEIL MCCRUDDEN Fourth Plaintiff

ANDGREGORY THORNTON Fifth Plaintiff

ANDMOTORSPORT LOGISTICS LIMITED Defendant

Continued:.../2

Hearing: 2-5 July, 6 August, and 27 September 2012

Appearances: JEM Lethbridge and JMJ Calder (2-5 July), T Allan (6 August), JEM Lethbridge (27 September) for Plaintiffs
S Hamilton for Defendant
M J Francis and H W King for First Third Party (given leave to withdraw)
C J Hlavac for Second Third Party (given leave to withdraw)

Judgment: 28 November 2012

(RESERVED) JUDGMENT OF ANDREWS J

This judgment is delivered by me on 28 November 2012 at 3:00pm pursuant to r 11.5 of the High Court Rules.

..................................................... Registrar / Deputy Registrar

MORTIMER AND MORTIMER & ORS V MOTORSPORT LOGISTICS LTD HC AK CIV 2011-004-000239 [28 November 2012]

.../2

ANDGULL NEW ZEALAND LIMITED First Third Party

ANDTHE HISTORIC RACING CLUB INCORPORATED
Second Third Party

Solicitors:
Grove Darlow & Partners: DX CP24049, Auckland - Plaintiffs:jacquel@grovedarlow.co.nz
Kennedys: DX CP20542, Auckland – Defendant:s.hamilton@kennedys-law.co.nz

Table of Contents

Para No.

Introduction ..........................................................................................................[1] The plaintiffs’ claims ............................................................................................[6] The supply of fuel at Hampton Downs ...............................................................[9] Admissions and concessions made by Motorsport ..........................................[18] First cause of action: breach of contract ..........................................................[21] Second cause of action: breach of the Sale of Goods Act 1908.......................[29] Third cause of action: Consumer Guarantees Act ..........................................[34] Fourth cause of action: breach of s 9 of the Fair Trading Act 1986 ..............[35] Fifth cause of action: negligence .......................................................................[38] The position of the first plaintiffs .....................................................................[40] Conclusion as to liability....................................................................................[45] Quantum .............................................................................................................[46] First plaintiffs .......................................................................................................[47] (a) The repair costs .........................................................................................[48] (b) The Melbourne trip....................................................................................[58] Second Plaintiff ....................................................................................................[64] Third plaintiff .......................................................................................................[70] Fourth plaintiff .....................................................................................................[71] Fifth plaintiff ........................................................................................................[77] Result ...................................................................................................................[81]

Introduction

[1] An historic racing car is one which was manufactured before 1985. Within the general category of historic racing cars, Formula 5000 (“F5000”) cars are those manufactured between 1968 and 1976, which have five litre engines.

[2] Historic racing cars are tuned to run on leaded, high octane fuel. The fuel most commonly used is aviation gas (“Avgas”), a leaded fuel with an octane rating of over 100, used in the aviation industry. Alternatively, a lower octane fuel may be used if it has had a lead additive added to it, to increase the octane rating. Such a “blended” fuel is commonly sold as “race gas”, or “Avgas equivalent”.

[3] Neither Avgas nor race gas contain ethanol. Ethanol is suitable only for use in modern cars, which are built with components which can withstand the corrosive effect of ethanol. Ethanol can cause significant damage to the components of historic racing cars.

[4] The plaintiffs are owners of historic racing cars, which raced at a motorsport event (under the banner of New Zealand Festival…

Grounds of appeal

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

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

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

Consideration

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

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

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Details

Case: [2012] NZHC 3180
Decision Date: 28 November 2012

CaseChat Overview and Summary

In the High Court of New Zealand, the plaintiffs, owners of historic racing cars, brought claims against Motorsport Logistics Ltd ("Motorsport") for damages caused by the supply of unsuitable fuel at a motorsport event. The plaintiffs argued that Motorsport supplied fuel that contained ethanol, which was unsuitable for their cars, leading to significant engine damage. Motorsport admitted supplying the fuel but disputed liability and the quantum of damages claimed.

The court found that Motorsport was liable under five causes of action: breach of contract, breach of the Sale of Goods Act 1908, breach of s 9 of the Consumer Guarantees Act, breach of s 9 of the Fair Trading Act 1986, and negligence. The court held that Motorsport breached an express or implied term of the contract to supply suitable fuel, breached statutory warranties, misled the plaintiffs under the Fair Trading Act, and failed in its duty of care. The court rejected Motorsport's arguments that it had not expressly agreed to supply Avgas, or that the plaintiffs had not relied on its expertise.

The court awarded damages to each plaintiff for repair costs and other losses directly attributable to Motorsport's breach. The first plaintiffs were awarded $63,952.75 for repair costs and $7,032.98 for the crew's non-refundable travel expenses. The second plaintiff was awarded $35,261.30 for repair costs and labour. The third plaintiff was awarded $16,657.42 for repair costs. The fourth plaintiff was awarded $46,701.50 for repair costs, freight, and travel expenses. The fifth plaintiff was awarded $27,646.45 for repair costs and fuel.

The court ordered Motorsport to pay the plaintiffs' costs of the proceeding on a 2B basis, together with disbursements as fixed by the Registrar.

Orders