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  • Unreported Judgment

Samios Plumbing Pty Ltd v John R Keith (QLD) Pty Ltd

 

[2019] QDC 237

 

DISTRICT COURT OF QUEENSLAND

 

CITATION:

Samios Plumbing Pty Ltd v John R Keith (QLD) Pty Ltd [2019] QDC 237

PARTIES:

SAMIOS PLUMBING PTY LTD

ACN 010 360 899
(plaintiff)

v

JOHN R KEITH (QLD) PTY LTD

ACN 140 815 434
(defendant)

FILE NO/S:

1650 of 2018

DIVISION:

Civil

PROCEEDING:

Hearing

DELIVERED ON:

29 November 2019

DELIVERED AT:

Brisbane

HEARING DATE:

18 November 2019

JUDGE:

Barlow QC DCJ

ORDER:

The Court declares that the terms of the contracts referred to in paragraph 13 of the statement of claim were:

  1. (a)
    in the case of all contracts, the terms set out in the credit agreement between the parties, comprising the credit application form (as amended) signed on behalf of the defendant on 1 February 2010, the defendant’s terms and conditions attached to that form and the plaintiff’s letter of 10 February 2010; save that the references, in clause 13.3 of the defendant’s terms, to clauses 14.1 and 14.2 are taken to be references to clauses 13.1 and 13.2, and clause 13 does not have any effect inconsistent with the term of the credit agreement requiring payment for goods supplied by the end of the month following supply; and
  2. (b)
    in the case of each contract, that the plaintiff would supply to the defendant the specific goods set out in the relevant purchase order sent by the defendant to the plaintiff.

CATCHWORDS:

CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – FORMATION OF CONTRACTUAL RELATIONS – OFFER – GENERALLY – where a credit application was sent to the plaintiff by the defendant, enclosing the defendant’s terms and conditions – whether the credit application constituted an offer

CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – FORMATION OF CONTRACTUAL RELATIONS – ACCEPTANCE – GENERALLY – LEGAL PRINCIPLES – where plaintiff approved the defendant’s credit application – whether approval letter constituted acceptance of an offer and acceptance of the defendant’s terms and conditions

CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – FORMATION OF CONTRACTUAL RELATIONS – ACCEPTANCE ADDING TO OR VARYING TERMS OF OFFER - COUNTER-OFFER – where the plaintiff sent letter to the defendant approving the credit application – where the letter reiterated some of the plaintiff’s payment terms – whether the letter amounted to counter-offer rather than acceptance

CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – CONSIDERATION – FAILURE OF CONSIDERATION – whether the credit application provided for consideration from either party to the other

Uniform Civil Procedure Rules 1999 (Qld) r 483

Central Cleaning Supplies (Australia) Pty Ltd v Elkerton (2015) 321 ALR 181, applied

Jireh International Pty Ltd v Western Export Services Inc [2011] NSWCA 137, applied

Toll FGCT) Pty Ltd v Alphapharm Pty Ltd. (2004) 219 CLR 165, applied

Trenfield v HAG Import Corporation (Australia) Pty Ltd [2018] QDC 107, considered

COUNSEL:

AF Messina for the plaintiff

SD McCarthy for the defendant

SOLICITORS:

Results Legal for the plaintiff

Bradbury Legal for the defendant

Introduction

  1. [1]
    The plaintiff company (Samios) supplied plumbing goods to the defendant company (JRK) on credit. Samios claims nearly $300,000 for debts which it contends JRK owes it for goods supplied in September and October 2017. The terms of the contract or contracts pursuant to which those goods were supplied are in issue and the determination of that issue will have significant effects on the parties’ rights and obligations, both in this proceeding and in proceedings between Samios and a company related to JRK, in the Supreme Court of New South Wales.
  1. [2]
    On 18 September 2019, the Court ordered, pursuant to r 483 of the Uniform Civil Procedure Rules 1999 (Qld), that the following question be decided separately from and before the trial of the proceeding:

What were the terms of any contract or contracts between the plaintiff and the defendant for the supply of the goods referred to in paragraph 13 of the amended statement of claim?

  1. [3]
    It now falls to me to answer that question.

Principal facts and contentions

  1. [4]
    On 1 February 2010, JRK sent by facsimile to Samios a pro forma application for a thirty-day credit account, signed by JRK’s financial controller, a covering letter and a copy of JRK’s terms and conditions of trade.[1]  The pro forma application form included the following sentence:

All goods shall be sold in accordance with the “STANDARD TERMS AND CONDITIONS” as outlined in the purchase Invoice.

  1. [5]
    The credit application sent by JRK to Samios had that sentence struck out by hand and that change was initialled by JRK’s financial controller.
  1. [6]
    On 10 February 2010, Samios sent a letter to JRK,[2] relevantly saying:

…your application for an Account with Samios Plumbing has been approved. 

Our Trading Terms are 30 Days: ie goods purchased in one month are due and payable before the 30th day of the following month.  …

Samios Plumbing reserves the right to cancel or vary the terms or conditions of this Account at any time.

  1. [7]
    From shortly after that date until the end of October 2017, JRK placed orders with Samios, by written purchase orders, for the supply of plumbing goods on the credit account and Samios supplied the goods ordered.
  1. [8]
    JRK contends that the credit application and the accompanying JRK terms and conditions were an offer to enter into an agreement for the future supply of goods on credit, on the terms specified in the application as amended and in JRK’s terms and conditions. The offer unequivocally excluded Samios’ standard terms and conditions and substituted in their place JRK’s terms and conditions by enclosing them with the credit application. JRK contends that, by its letter of 10 February 2010, Samios accepted that offer and therefore all supplies of goods by Samios to JRK were subject to JRK’s terms and conditions, as varied by any terms of the credit application that were not consistent with JRK’s conditions and had not been deleted from the pro forma form.
  1. [9]
    Samios denies that the application was an offer to enter into such an agreement. It contends that the credit application was simply a request that Samios extend credit to JRK for any future orders of goods, but it could not and did not result in any agreement. In particular, Samios reserved the right at any time to withdraw or to vary the terms of the credit facility (thus not providing any real consideration) and, in any event, JRK gave no consideration for Samios’ willingness to extend credit. At the hearing, Samios contended (inconsistently with the allegations in its amended statement of claim) that each order was a separate offer to purchase goods, all goods were supplied with a delivery docket that relevantly referred to Samios’ “terms and conditions” and constituted an offer to supply the goods on those conditions, and JRK accepted each offer by taking delivery of the goods and keeping them without objection.[3]  Counsel for Samios, Mr Messina, referred to this method of contracting as a “battle of the forms” – where the parties negotiated each sale by the use of standard forms with conflicting terms and the final terms were those stated on the last form (in this case, each delivery docket), with those terms accepted by JRK’s conduct in retaining the goods.

The credit application and JRK’s conditions

  1. [10]
    On 1 February 2010, JRK sent a facsimile of four pages to Samios. The first page was a letter that commenced, “We enclose for your consideration an application form to establish a credit facility.” It then went on to give some details about JRK, its business and its related companies.[4]
  1. [11]
    The following pages of the facsimile comprised two pages of Samios’ standard credit application form,[5] completed and amended by JRK’s financial controller, and one page comprising JRK’s “Terms and conditions of trade”.  The form was titled, “NEW ACCOUNT APPLICATION/UPDATE OF DETAILS”.  Following provision for the insertion of details of the applicant for credit, it continued relevantly as follows:

IT IS AGREED:

I/We the undersigned, certify that the information supplied to SAMIOS PLUMBING Pty Ltd for the purpose of assessing the suitability for providing me/us with 30 Day Credit Facilities is correct at time of writing, and that I/we is/are Authorised on behalf of the applicant to make this application and contract on behalf of the applicant and give the warranties outlined in this application.

SAMIOS PLUMBING Pty Ltd reserves the right to withdraw credit facilities at any time without notice.

Terms are Strictly 30 DAYS from Statement date, ie Purchases made during one month are due and payable by the 30th day of the following month.  Failure to pay within these terms could result in suspension of Credit Facilities until ALL outstanding amounts are paid in FULL.

SAMIOS PLUMBING Pty Ltd reserves the right to charge interest on overdue amounts at the rate not exceeding the standard overdraft rate offered by the Commonwealth Bank on the day of calculation.  Such interest if applied shall be charged direct to your account.

All goods shall be sold in accordance with the “STANDARD TERMS AND CONDITIONS” as outlined on the purchase Invoice.[6]

I/We have read the conditions of this application and agree to be bound by them in consideration of SAMIOS PLUMBING Pty Ltd providing Credit facilities.

Costs associated with the collection of any overdue account will be the responsibility of the credit applicant.  …

  1. [12]
    The relevant parts of JRK’s terms and conditions of trade are:

1 Definitions

In these terms and conditions:  “Goods” means the goods and/or services described in the Order.  “JRK” means [the defendant].  …  “Order” means an order by JRK for the Supply of goods and/or services constituted by an order form …  “Supply” means the supply, hire, provision and/or delivery of the Goods.  “Supply Contract” means an agreement for the Supply of Goods by the Supplier to JRK constituted by JRK’s Order and an acceptance of such an Order by the Supplier.

2 Application of these Terms

2.1 To the fullest extent permitted by law, all dealings between JRK and any Supplier relating to the Supply of Goods are subject to these terms and conditions.  The Supplier is deemed to have accepted these terms and conditions when the Supplier provides a quotation to JRK and if no quotation is provided, then when the Supplier accepts an Order.  Any terms and conditions sought to be imposed by the Supplier which are in addition to, inconsistent with or differ from these terms and conditions are expressly rejected by JRK and shall be of no effect, notwithstanding any purported condition by the Supplier whether express or implied that its terms and conditions shall prevail and/or prescribing the manner in which the Supplier’s terms are to be rejected. …

2.2 If the Supplier is unable or unwilling to accept any of the conditions contained in these terms and conditions, then the Supplier must immediately notify JRK in writing and return the Order to JRK.

13 Invoicing and Payment

13.1 Following delivery of the Goods, the Supplier shall promptly render invoices to JRK, stating JRK’s Order number and delivery docket number.  The Supplier shall also render monthly statements to be received by JRK by no later than the 14th day of the month following the month to which the invoices relate.  Failure by the Supplier to comply with this clause, including as to time, will result in payment delays.

13.3 Subject to compliance by the Supplier with these terms and conditions and the terms and conditions of any Supply Contract, the period for payment will be the end of the month following compliance by the Supplier with clauses 14.1 and 14.2 of these terms and conditions.

14 Liability

14.1 The Supplier is liable for and indemnifies JRK and the JRK Group … against any claim … or expense (including legal costs on a full indemnity basis) that is suffered or incurred by them or any of them as a direct result of:

  1. (a)
    the Supply of the Goods; 

17 Miscellaneous Provisions:

17.1 Any purported modification of these terms and conditions whether express or implied shall not be binding against JRK unless it is in writing and signed by JRK’s duly authorised representative.

17.3 The Supplier shall be bound by any variation to these Terms adopted by JRK and notified in writing to the Supplier immediately they are so notified and notwithstanding any other purported or pre-existing terms and conditions which might otherwise have applied.

  1. [13]
    Additionally, clause 7 provided for a supplier’s warranties to JRK concerning goods supplied pursuant to an order and clause 8 imposed obligations on a supplier to provide certain documentation with goods supplied.
  1. [14]
    The evidence is not clear (and it is not pleaded) exactly when JRK first gave an order to Samios and Samios first supplied goods. However, in an affidavit relied on by JRK, the deponent (Mr Keith) said, “The first order placed by JRK QLD under the credit agreement occurred on or about February 2010.”[7]  A statement of agreed facts that was tendered also said, “From 10 February 2010, the defendant placed orders with the plaintiff for the supply of plumbing goods on the credit account by written purchase order.”[8]
  1. [15]
    I infer from these facts that JRK placed at least one order with Samios in February 2010. That may have been before it received Samios’ letter of 10 February 2010, as the original of that letter is stamped, and appears to have been received by JRK on, 11 March 2010. But even if that is the case, it does not affect the terms on which goods were supplied in 2017, by when a lot of water had passed through the pipes.
  1. [16]
    Samios submits that the application form, by its terms, was not and did not purport to be an application to enter into an agreement to govern the future supply of goods.
  1. [17]
    Samios relies heavily on a decision of Judge McGill SC, in which his Honour determined that an application for credit relating to the future supply of goods was not itself an agreement. In particular, Samios relies on the following statement by his Honour:[9]

“The credit application is not on its face contractual; it is expressed as a request for credit, an admission by the company that it had been provided with the defendant’s standard terms and conditions, and an acknowledgment that they may be changed at any time.  It does not say that either party promises to do, or not to do, anything.”

  1. [18]
    Samios contends that this description applies to the credit application in this case. It supports that proposition by reference to JRK’s terms attached to the credit application, which clearly contemplate that each separate order and supply of goods would constitute a separate “Supply Contract”. Therefore, the terms of any future supply contract may be different from others. The application for credit was not an offer, capable of acceptance as a binding contract, to enter into an agreement to govern the supply of goods in the future. It was simply a request for credit and the provision of information about JRK that would assist Samios to decide whether to offer credit to JRK for the supply of goods in the future.[10]
  1. [19]
    Samios also contends that the credit application did not provide for consideration flowing from either party to the other. Samios in particular reserved its right not to provide credit at any time or to change the terms of credit. Its “promise” to provide credit was therefore merely a discretion to provide credit and was in that sense illusory and insufficient to constitute consideration. As McGill SC DCJ said in Trenfield, if a party has an unfettered discretion as to performance, there is no consideration provided, and no contract.[11]
  1. [20]
    I do not agree with Samios’ description of the nature of the credit application in this case. The terms of the credit application in Trenfield, so far as they were set out in the reasons for judgment, were very different from those of Samios’ form.  The first page of the form certainly provided for information about the applicant to be set out, but the second page was far more formal.  It commenced with the words “It is agreed”, which are of course quintessentially words of agreement or contract.  It then purports to impose a number of obligations on the applicant, including liability for costs of enforcement of debts, a requirement to pay within 30 days of monthly statements and to pay interest on overdue amounts and it provides that the applicant “certifies” that the information provided is correct (which I consider to be akin to a warranty – a word that also appears in the form).  The certification also provides that the undersigned is authorised to make the application and to “contract on behalf of the applicant”.  Finally, the form provides that the applicant agrees to be bound by the conditions of the application “in consideration of SAMIOS PLUMBING Pty Ltd providing Credit facilities.”
  1. [21]
    The language of the form is unequivocally contractual. It also provides for consideration from each party to the other. The applicant gives consideration in the form of its promises, obligations and warranties. Samios gives consideration in the form of its agreement to provide credit for future orders of goods. Although Samios reserves “the right to withdraw credit facilities at any time without notice”, that does not mean that it has a complete discretion whether or not to provide credit. Once an order for goods is accepted by Samios, it is obliged to provide credit in respect of that order and JRK is obliged to pay within the stipulated time. That reservation of “rights” is simply an express entitlement to terminate the agreement to provide credit facilities at any time. Many contracts are terminable at the will of one or both of the parties, but they are nevertheless enforceable until terminated. That does not mean that they have no contractual effect while they are on foot.[12]  When one party terminates the contract, then the parties’ existing rights accrued under the contract continue, but they are released from any further performance.
  1. [22]
    It was clear from the application and the accompanying copy of JRK’s terms and conditions, together with the covering letter, that, by sending those documents to Samios, JRK was offering to enter into a contract for the provision of credit by Samios to JRK for future purchases of goods by JRK from Samios. In replacement of Samios’ proposed term of the credit agreement that all purchases of goods be on Samios’ terms and conditions, JRK was offering to enter into the credit agreement on terms that included the requirement that all purchases of goods on credit be on JRK’s terms and conditions.
  1. [23]
    JRK thereby signified its intention to create legal relations with Samios on those terms but, until its offer was accepted, no such relations would come into existence.[13]
  1. [24]
    Samios contends that, even if the credit application might be of a contractual nature, JRK’s offer was not accepted by Samios and therefore no contract on its terms was agreed. It submitted that the letter of 10 February 2010 did not accept the terms of JRK’s offer, but all it did was inform JRK that it had been approved for a credit account. It did not say that Samios agreed to supply goods to JRK on JRK’s terms and conditions. The language in the letter is not such that it would convey to a reasonable person in JRK’s position a clear and definite decision by Samios to be bound by the terms of the credit application, including JRK’s terms, leaving nothing further to negotiate.[14]
  1. [25]
    To the contrary, Samios submits, the letter rehearsed payment terms in Samios’ application form which were wholly inconsistent with clause 13 of JRK’s terms. The offer (if it is one) and the letter do not precisely correspond, as they must. The departure from the offer renders the purported acceptance ineffective as such.[15]  If anything, the letter of 10 February 2010 reiterated that Samios was prepared to deal with JRK on Samios’ trading terms, as appeared in the application form, and it therefore amounted to a counter-offer, rather than acceptance of JRK’s offer.
  1. [26]
    The upshot of those submissions is that, if the terms offered by JRK were not accepted by Samios, the situation returned to a “battle of the forms”. That is, when JRK placed an order that provided that supplies were on its terms and conditions, those terms were rejected when goods were supplied with a delivery docket referring to Samios’ terms and by accepting and retaining the goods JRK accepted those terms.
  1. [27]
    Again, I disagree with Samios’ submissions. The letter of 10 February 2010 referred expressly to JRK’s application for a credit account. The only document to which it could have been referring was the application sent on 1 February 2010. By stating that the application had been approved, it clearly conveyed, to any reasonable business person, that Samios was accepting the application: that is, JRK’s offer to contract on the terms stated.
  1. [28]
    The letter went on to state, among other things, that Samios’ trading terms were 30 days and Samios reserved the “right” to cancel or vary the terms or conditions of the account facility at any time. But the “right to cancel” simply reiterated Samios’ entitlement to terminate the agreement at any time, as stated in the application form. The “right to … vary” the terms of the account facility was meaningless in the context of a contract, as no contract can be varied unilaterally. Once an agreement was made, Samios’ right to vary the terms of credit was a “right” to attempt to agree on a variation (for valuable consideration) and, if not agreed, to terminate the credit agreement. Having already, in that letter, accepted JRK’s application, that statement simply evidenced a misunderstanding about Samios’ rights under the agreement. The letter did not amount to a counter-offer to grant a facility on alternative terms.
  1. [29]
    Samios also submitted that a requirement that JRK pay for goods supplied by the end of the month following their supply is inconsistent with the payment provision in clause 13.3 of JRK’s terms and conditions. However, if read literally clause 13.3 makes no sense at all, because its application would mean that payment was never due to be made by JRK unless and until JRK suffered loss as a result of the supply of goods and Samios indemnified it for that loss.
  1. [30]
    A contract between commercial parties must be construed commercially and, if possible, every clause should be given meaning (and a sensible meaning). If a clause makes no sense or gives rise to an absurdity when read literally, then it may be read sensibly and mistakes may be corrected.[16]  It is clear to me that, in referring to clauses 14.1 and 14.2, clause 13.3 is intended to refer to clauses 13.1 and 13.2.  That is the only sensible meaning that can be given to it.
  1. [31]
    Read in that manner, clause 13.3 may still operate inconsistently with the offer constituted by the application form and the accompanying terms and conditions, by which JRK was clearly agreeing to terms of payment in accordance with the printed application form (that is, payment by the end of the month following supply of goods). This is because, when read with clause 13.1, in some instances (such as if a monthly statement under clause 13.1 is not given to JRK until early in the month following supply of the goods), it requires that payment be made, not in the month following supply but in the month following receipt of the monthly statement. But, if it (or indeed any others of JRK’s terms) were inconsistent with the specific terms set out in the application, then to that extent the inconsistent clause would have no effect. Consistently with clause 17.1, by signing the application form JRK was agreeing, in writing signed by its duly authorised representative, to modify the terms of payment in accordance with the specific method provided for in the application.
  1. [32]
    Therefore, I find that, by its letter dated 10 February 2010, Samios accepted JRK’s offer made on 1 February 2010. JRK’s offer was clearly intended to cover future dealings between the parties under which JRK was to order and Samios was to supply goods on credit.[17]  Upon Samios’ acceptance of that offer, the terms of those dealings were agreed, subject to either party terminating the arrangement thereafter.

The delivery dockets and invoices

  1. [33]
    In case I am wrong, I will also consider Samios’ submission that the “battle of the forms” resulted in its terms applying to all the supplies of goods the subject of this proceeding. It is also possible, although not clear from Samios’ submissions, that it contends that, even if the application led to a contract governing future dealings, by later delivering goods with a delivery docket and later supplying an invoice, each referring to Samios’ terms and conditions, it terminated the contract (as it was entitled to do) and thereafter supplied goods on its own terms.
  1. [34]
    I have set out Samios’ submission at [9] above. It relies on the fact that, at the time of each delivery, it provided a delivery docket to JRK, which JRK’s representative signed.[18]  Each delivery docket stated “*Terms and Conditions of Sale Available at www.samios.net.au”.  The subsequent invoice for each batch of goods also stated the same.  Samios’ terms were at all times available for perusal at that website.  Samios says that, by accepting the goods with the delivery docket and not subsequently rejecting the goods, JRK accepted them on Samios’ terms.
  1. [35]
    Each order by JRK was on its own purchase order form. Each order was sent to Samios by email and listed the goods ordered. Each purchase order form stated at the end:

This order and all dealings in connection with it are subject to our Terms and Conditions of Trade to the exclusion of any other terms and conditions unless expressly agreed to in writing by our duly authorised representative.

  1. [36]
    Each order was accompanied by a copy of JRK’s terms and conditions.[19]
  1. [37]
    Therefore, even if the credit agreement did not exist, each order was an offer to purchase the goods listed on JRK’s terms.
  1. [38]
    Samios never expressly or clearly rejected those terms. It simply delivered the goods ordered on each occasion, accompanied by a delivery docket that referred to Samios’ terms and conditions. However, the delivery docket did not expressly state that those terms applied to the goods delivered, in the clear manner that was stated in JRK’s orders. Further, the delivery docket was not obviously of a contractual nature. Rather, it appeared to be an administrative document to be used for accounting and record keeping purposes. It was not a document that a reasonable person would have understood as intended to have the effect of either leading to the creation of a contract on any specific terms (particularly on terms substantially different to those offered by JRK), or of varying a contract that had already been made (if, as I have found, the credit agreement had been made and covered future supplies of goods).[20]
  1. [39]
    This construction is supported by evidence on behalf of Samios that the purpose of the delivery dockets providing for the customer to sign them was “to acknowledge that the goods have been received.”[21]  Its purpose was not contractual.
  1. [40]
    Therefore, the provision of a delivery docket with each order was not an offer to enter into a contract on Samios’ terms. Rather, having received each order, comprising an offer that was expressly and clearly made on JRK’s terms, by its conduct in then delivering the goods in accordance with the order, Samios accepted JRK’s terms as those governing that order.
  1. [41]
    If, as I have found, the credit agreement applied to all purchases of goods but, contrary to my finding, the delivery docket was of a contractual nature (in the form of a counter-offer), the delivery docket was in any event of no effect because of clause 2 of JRK’s terms. Also, clause 17.1 of those terms made it clear that there would be no variation of those terms unless it was signed by an authorised representative of JRK. There is no evidence that the delivery dockets were in fact signed by a representative of JRK, although it is likely that they were. But even if they were, a reasonable person would not expect that a person simply taking delivery of goods ordered would have authority to enter into or vary a contract on JRK’s behalf.
  1. [42]
    The invoices could have no contractual effect at all. They were merely reflective of the amounts owed for the goods supplied and they were produced well after each supply was completed. They are therefore irrelevant to the question I am determining.

PPSR registration

  1. [43]
    Samios’ terms include a detailed retention of title clause. Among other things, it provides that title to the goods will only pass to the purchaser when all moneys owing by it to Samios on any account have been paid in full. The purchaser acknowledges that the contract is a Security Agreement and that Samios is entitled to register its interest in the goods supplied or to be supplied on the Personal Property Security Register (PPSR) under the Personal Property Securities Act 2009 (Cth).
  1. [44]
    On 12 January 2012, Samios registered a personal money security interest on the PPSR with JRK named as the grantor. A search certificate was exhibited to the affidavit filed on Samios’ behalf, confirming that to be the case.[22]  The deponent, Ms Hay, said that Samios had not received any request from JRK to withdraw or remove that registration.  However, neither Ms Hay nor the certificate states under what contract the security interest is granted, nor over what goods.  On Samios’ case, each supply was under a separate contract, so it is not clear under what contract or contracts this interest was registered.
  1. [45]
    The purpose of this evidence appears to be to demonstrate that the parties acted in accordance with Samios’ terms and therefore they must have agreed to adopt those terms. However, Mr Keith deposed that, until he saw Ms Hay’s affidavit, JRK was not aware that any security interest had been registered.[23]
  1. [46]
    While post-contractual conduct is admissible on the question whether a contract was formed, I agree with the submission by counsel for JRK that Ms Hay’s evidence simply shows, at most, Samios’ subjective belief, some years after the credit agreement was made, that its terms applied and it was entitled to register an interest on the PPSR under those terms. But the parties’ subjective belief is irrelevant to the question whether the contract was formed in 2010 and, if so, its terms. Furthermore, the evidence does not demonstrate any agreement to that effect, where JRK did not know of the PPSR registration.

Conclusions

  1. [47]
    Accordingly, the credit agreement governed the terms of all subsequent orders and supplies of goods. Each order was an offer to enter into a separate contract for the supply of goods[24] but, in accordance with the ongoing credit agreement, the terms of that contract were those set out in the credit agreement, including JRK’s terms and conditions.  Alternatively, each order was an offer to purchase goods on JRK’s terms as stated.   Each offer was accepted by Samios’ delivery of the goods.
  1. [48]
    For these reasons, the terms of each of the contracts referred to in paragraph 13 of the statement of claim, to supply the goods listed in the relevant purchase order, were those set out in the credit agreement. That agreement comprised the credit application form (as amended) signed on behalf of JRK, JRK’s terms and conditions and Samios’ letter of 10 February 2010. To the extent that there was any inconsistency between JRK’s standard terms and the terms set out on the face of the credit application form, the latter prevail.[25]

Footnotes

[1]  Exhibit 3, JRK-1 at 2-5.

[2]  Exhibit 3, JRK-1 at 8.

[3]  This was Samios’ contention at the hearing of the separate question, although it is not pleaded in its amended statement of claim.   It is bound by that contention for all future purposes of this proceeding and must amend its statement of claim accordingly.

[4]  In fact, Samios and a related company of JRK had done business together in New South Wales and Samios in that State was named in the letter as a referee.

[5]  JRK did not send pages 3 and 4 of the standard form, which comprised a directors’ guarantee.

[6]  The crossed out words were initialled by JRK’s financial controller in the form sent to Samios.

[7]  Exhibit 3 at [19].

[8]  Exhibit 2 at [5].

[9] Trenfield v HAG Import Corporation (Australia) Pty Ltd [2018] QDC 107 at [13].

[10] Trenfield at [23]-[26].

[11] Placer Development Ltd v The Commonwealth (1969) 121 CLR 353 at 361, 370;  Trenfield at footnote 16.

[12] Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197 at 206.

[13] Central Cleaning Supplies (Australia) Pty Ltd v Elkerton (2015) 321 ALR 181 at [30]-[31].

[14] Ballas v Theophilos (No 2) (1957) 98 CLR 193 at 204-6 and 209-11;  Quadling v Robinson (1976) 137 CLR 192 at 201;  Redwood Pty Ltd v Mongoose Pty Ltd [2005] NSWCA 32 at [130].

[15] Precision Pools Pty Ltd v Federal Commissioner of Taxation (1992) 37 FCR 554 at 560 (Spender J);  Mooney v Williams (1905) 3 CLR 1.

[16] Jireh International Pty Ltd v Western Export Services Inc [2011] NSWCA 137 at [55], [59] and [63]-[64].

[17] Toll FGCT) Pty Ltd v Alphapharm Pty Ltd. (2004) 219 CLR 165 at [21] and [64].

[18]  Or at least, was supposed to sign.  Samios’ evidence was that delivery dockets are not always signed by the customer: exhibit 1 at [19](f).

[19]  The facts stated in paragraphs [35] and [36] were deposed to in exhibit 3 at [21], with copies of the emails, orders and terms and conditions relevant to this proceeding attached.  No challenge was made to that evidence.

[20] Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd at [62].

[21]  Exhibit 1 at [19](f).

[22]  Exhibit 1 at 80-81.

[23]  Exhibit 3 at [28].

[24]  A “Supply Contract”, as defined in clause 1 of JRK’s terms.

[25]  The only term that has been discussed to which this might apply is clause 13 of JRK’s standard terms, but it would also apply to any other inconsistent terms, if there are any.

Close

Editorial Notes

  • Published Case Name:

    Samios Plumbing Pty Ltd v John R Keith (QLD) Pty Ltd

  • Shortened Case Name:

    Samios Plumbing Pty Ltd v John R Keith (QLD) Pty Ltd

  • MNC:

    [2019] QDC 237

  • Court:

    QDC

  • Judge(s):

    Barlow DCJ

  • Date:

    29 Nov 2019

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.
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