Sherrin Rentals Pty Ltd v Mac-Attack Equipment Hire Pty Ltd
[2012] QDC 150
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- Sherrin Rentals Pty Ltd v Mac-Attack Equipment Hire Pty Ltd[2012] QDC 150
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Sherrin Rentals Pty Ltd v Mac-Attack Equipment Hire Pty Ltd[2012] QDC 150
Sherrin Rentals Pty Ltd v Mac-Attack Equipment Hire Pty Ltd[2012] QDC 150
DISTRICT COURT OF QUEENSLAND
CITATION: | Sherrin Rentals Pty Ltd v Mac-Attack Equipment Hire Pty Ltd [2012] QDC 150 |
PARTIES: | SHERRIN RENTALS PTY LTD (Plaintiff) AND MAC-ATTACK EQUIPMENT HIRE PTY LTD (Defendant) |
FILE NO/S: | BD386/2008 |
DIVISION: | |
PROCEEDING: | Trial |
ORIGINATING COURT: | District Court, Brisbane |
DELIVERED ON: | 26 June 2012 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 28, 29 November 2011 |
JUDGE: | McGill DCJ |
ORDER: | Judgment that the defendant pay the plaintiff $297,364.75 including $139,222.82 as interest. |
CATCHWORDS: | CONTRACT – Offer and acceptance – no contract in writing – whether contract incorporated standard terms of plaintiff previously made known to the defendant – effect of such terms. HIRE AND HIRE PURCHASE – Hire of chattels – whether owner’s standard terms incorporated in contract – effect of terms – liability of hirer. A.J. Lucas Operations Pty Ltd v Mac-Attack Equipment Hire Pty Ltd [2009] NTCA 4 – considered. A.J. Lucas Operations Pty Ltd v Mac-Attack Equipment Hire Pty Ltd [2009] NTSC 48 – considered. Con-Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Aust) Ltd (1986) 160 CLR 226 – cited. Hays Personnel Services (Aust) Pty Ltd v Motorline Pty Ltd [2008] QCA 375 – applied. |
COUNSEL: | J.K. Ratanatray (Solicitor) for the plaintiff D.J. McPartland (director) for the defendant |
SOLICITORS: | MSB Lawyers for the plaintiff The defendant was not represented |
- [1]This is an action to recover money alleged to be owing for the hire of certain construction equipment by the plaintiff to the defendant. The plaintiff’s business is to hire out just the equipment, whereas the defendant provides to customers equipment with an operator, frequently also supplying fuel and accommodation for the operator, or at least arranging for it to be provided: p 104. Effectively, the defendant was doing work, mostly with its own equipment, but sometimes with equipment hired from someone like the plaintiff. There was no real dispute that the defendant had hired various items of equipment from the plaintiff, but there was a dispute as to the amounts payable by the defendant in respect of such hire.
- [2]The defendant complained about a number of matters, but particularly that stand-down periods, that is periods of time when the equipment was treated as temporarily not being hired by the plaintiff to the defendant for some particular reason, which had been agreed to were not credited; an insurance surcharge was imposed on the hire of equipment when it ought not to have been imposed because the defendant had its own insurance cover available or could have arranged it; and that the defendant was not bound by the plaintiff’s terms and conditions: p 106‑7. There was also a brief point raised about some charges for fuel in a couple of invoices. In the defence, it was alleged that some payments had not been credited to the defendant’s account, but by the trial this had been resolved and the point was not pursued by the defendant: p 91.
- [3]The plaintiff’s case was run largely on the basis of proving its business records relating to the various transactions on which it was suing. No-one who had dealt directly with the defendant was called to give evidence, the plaintiff’s case depending on its records and evidence from the general manager, who was able to explain the way in which the business operated and how the records were generated and what they meant, but had had no dealings directly with the defendant.
- [4]The plaintiff’s system was that, when a customer made arrangements to rent a piece of equipment, the computer system created a booking number: p19. The rental agreement with terms and conditions on the back was printed out when the equipment was delivered, or the day before, and sent to the customer, usually at the time the equipment was delivered: p16. The form assumed that the customer will then sign to acknowledge receipt of the equipment hired and to agree to the terms and conditions on the back of rental agreement. It appears, however, that in practice that often did not occur: p 37. If anything happened during the rental, like the hiring being suspended (“stand down”) or if the equipment were changed over, this was noted in the computer record, and ultimately when the hire came to an end an “off hire” date was given and an invoice was then generated through the same system and sent out: p.19. The various steps are numbered by the computer system. The invoices also had a copy of the plaintiff’s terms and conditions on the back.[1]
- [5]In practice the rental agreements were not always signed on behalf of the defendant, at least by some person with authority to do so. None of the rental agreements in evidence in this matter were signed by a director of the defendant company. Most were not signed by anybody associated with the company at all. That does not mean that there was no contract of hire; it simply means that it is not just a matter of looking at a written document which has been signed on behalf of the defendant.
- [6]There was the further difficulty that the defendant’s evidence was that until October 2007 invoices sent in relation to hiring this equipment were not received, and that payments were being made only on the basis of oral advice from the manager of the plaintiff’s Northern Territory branch as to what sums were owing: p108. This was disputed by the plaintiff, but all that the plaintiff’s witness, the general manager, could say was that another person within the plaintiff’s organisation had followed up the payment of the invoices and, if there had been any failure to provide invoices, had overcome that failure: p 59, p 60. There was no direct evidence from anyone in a position to give such evidence, or from any documents admissible against the defendant, to contradict the defendant’s assertion that the invoices were not being received. It seems odd that this would occur, particularly because the invoices had on them a post office box address, which the defendant’s director said was being cleared regularly during the relevant time: p 116-7, p 120. Nevertheless, the defendant’s evidence on this point remains, strictly speaking, uncontradicted.
- [7]With regard to the fuel charges, the plaintiff relied on its business records and, I suppose, the presumption of regularity. The defendant on the other hand said that all machines were returned full of fuel, and suggested that the plaintiff’s employees were stealing fuel: p 118. In effect, the defendant relied on a regular practice. The invoices in question were 5003462, including fuel for two rollers when they came off hire on 12 January 2008, and 5003461 including fuel for truck DT40012 when it came off hire the same day. On the whole I consider the more likely explanation is that on that day the defendant’s practice of returning equipment full of fuel broke down, and accept the reliability of the plaintiff’s business records, on the balance of probabilities. The plaintiff is entitled to recover the charges for fuel.
Terms of the contract
- [8]The first issue which arises is as to the terms of any contract between the parties. There were terms and conditions printed on the back of the rental agreements, and terms and conditions printed on the back of the invoices, but the defendant argued that the former had never been signed and the latter were not received, at least until well after these hirings had come into existence. It is, however, necessary to bear in mind that these were standard terms and conditions used by the plaintiff. There was evidence that there had been some change in the standard terms used by the plaintiff, but it appears that the change was not material, since it occurred after all of the relevant equipment had been hired.
- [9]Where there is an isolated hiring and the documentation has not been properly attended to, there may well be a good argument that standard terms and conditions have not been incorporated into a contract between the parties, and in those circumstances there may be some difficulty in identifying just what the terms of the contract between the parties are. In the present case, however, the equipment the subject of this proceeding was by no means the first equipment which had been hired by the defendant from the plaintiff.
- [10]The plaintiff started operations in the Northern Territory in about the middle of 2006, and the defendant’s director admitted that there had been occasions before those in issue on which equipment had been hired by the defendant from the plaintiff.[2] This equipment had been paid for; invoices for these hirings had been received: p 34. I would expect that even if rental agreements were not signed on behalf of the defendant in relation to the earlier hirings, at least such documents would have been provided by the plaintiff to the defendant with the equipment: p 51. In these circumstances, prior to the time when any of the relevant pieces of equipment were hired, the defendant was in a position to know what the standard terms and conditions of hire used by the plaintiff were.[3] The terms and conditions were also in the account application form supplied to the defendant not later than 18 October 2006: Exhibit 6. It would be reasonable for someone in the defendant’s position to assume that the plaintiff, when offering equipment for hire, was offering subject to its standard terms and conditions, so that by taking the equipment on hire a contract was formed, either orally or by conduct, which incorporated the standard terms and conditions used by the plaintiff.[4]
- [11]The defendant referred to a decision of the Northern Territory Supreme Court[5] which he said turned on the fact that the contractual document, the rental agreement, had not been signed by the defendant. The case concerned the judicial review of a decision of an adjudicator under the Construction Contracts (Security of Payments) Act (NT), and turned on technical legal issues involving the interpretation of provisions of that Act. There was nothing decided about the effect of unsigned rental agreements. The decisions cannot assist the defendant.
- [12]One difficulty with this is whether it was particularly advanced during the trial. The plaintiff pleaded one agreement in September 2007 pursuant to which each hiring took place: Statement of Claim #3. The amended defence pleaded that the agreement was made in July 2007: #2. There was evidence that one director of the defendant signed as guarantor an account application which was to be signed by the other director, but never was;[6] there was no evidence that it had been accepted by the plaintiff. It was dated 18 October 2006 and had the same terms and conditions as Document 4. There was no evidence of any agreement, either specific or general, after 1 December 2007 when the standard terms and conditions changed, so the old terms apply and the new terms are irrelevant. There was evidence that there had been previous hirings, and that the plaintiff had standard terms and conditions at all times, and there was evidence from the defendant’s director that he had been aware of aspects of this as a result of those earlier dealings.[7] In the circumstances, I consider that it is appropriate to proceed on the basis that those standard terms and conditions were incorporated into any particular contract to hire between the parties in respect of the items of equipment the subject of the proceeding.
The hirings in question
- [13]The defendant provided the Darwin office of the plaintiff with a purchase order dated 1 June 2007 to hire two padfoot rollers at $210 per day and two 30‑tonne artic dump trucks at $900 per day: Document 1. The plaintiff provided one roller, RS12016, which was delivered to the defendant on 2 July 2007: Document 2, which was signed by Mr McPartland’s son on 2 July 2007: p 30. Mr McPartland said that his son had no authority to enter into a contract on behalf of the defendant and I accept that, but the evidence was that he was on site and I consider that he had sufficient authority to acknowledge receipt on that date of the equipment, so that this is evidence that this roller was delivered to the defendant on that date. That proposition did not appear to be particularly in issue.
- [14]There were then three rental agreements dated 16 July 2007 prepared in relation to three tip trucks, DT40010 (Document 4), DT40011 (Document 5) and DT40012 (Document 3). None of these was signed on behalf of the defendant. There are notes on Document 4 that the vehicle was picked up in Katherine by Mr McPartland, and on Document 5 that it was dropped off at Doondoon for Mr McPartland to pick up, but these appear to have been made by someone on behalf of the plaintiff. Nevertheless, the defendant did not dispute that these trucks had in fact been hired by it.
- [15]Invoices were issued in respect of the roller, RS12016 on 31 July 2007 for $2,582.57, 31 August 2007 for $7,747.74, 30 September 2007 for $7,489.48, 31 October 2007 for $6,860.70, 30 November 2007 for $5,971.35, 31 December 2007 for $4,065.60, and 31 January 2008 for $4,561.81: Exhibit 5[8]. According to the plaintiff’s records, the July invoice was paid on 28 September 2007, the August invoice on 23 October 2007, the September invoice on 21 December 2007, and the October invoice was finally paid on 19 October 2009, a cheque which was received on 21 January 2008 having been not met on presentation: Exhibit 5. The remaining invoices have not been paid. Copies of the July, August and September invoices were not in evidence; the address on the October invoice, Document 11, is PO Box 168, One Tree Hill, SA, 5114, as indeed was the address on all of the other invoices that are in evidence in Exhibit 1. The invoice of 31 January 2008 indicates that the hiring of this unit came to an end on 12 January 2008: Document 18.
- [16]Invoices were issued in respect of the tip truck DT40010 on 31 July 2007 for $7,747.74, 31 August 2007 for $27,769.40, and 19 September 2007 for $4,986.85: Exhibit 5. It appears that the hire of this vehicle came to an end on 12 September 2007. The first of these invoices was paid on 28 September 2007, the second by two payments, one on 23 October 2007 and one on 7 November 2007, and the third on 21 December 2007, so that there was no amount owing in respect of this unit.
- [17]Tip truck DT40011 was the subject of invoices on 31 July 2007 for $2,767.05, and $7,747.74, 31 August 2007 for $26,136, 30 September 2007 for $31,581, 31 October 2007 for $20,691, 30 November 2007 for $27,225, and 19 December 2007 for $14,282.80: Exhibit 5[9]. The first two invoices were paid on 28 September 2007 and the third on 7 November 2007; the fourth was to be paid by a cheque deposited 22 January 2008 but that cheque was not met on presentation and ultimately this payment was treated as discharged by funds received in September and October 2009. The remaining invoices have not been paid.
- [18]Tip truck DT40012 was the subject of invoices on 31 July 2007 for $11,597.74, 31 August 2007 for $28,314, 30 September 2007 for $31,581, 31 October 2007 for $26,136, 30 November 2007 for $27,225, 31 December 2007 for $18,513, and 31 January 2008 for $6,170.06: Exhibit 5[10]. As far as the plaintiff is concerned, the first invoice was paid on 28 September 2007, the second on 23 October 2007, and the third in part on 21 December 2007, with the balance of $4,057.33 to have been paid by a cheque deposited on 22 January 2008 which was not met on presentation, though the balance was paid on 29 September 2009. The same position applied to part of the October invoice but $23,635.03 remains outstanding; the November, December and January invoices have not yet been paid.
- [19]On about 29 October 2007, the plaintiff dropped off at Shaw’s Transport Yard in Darwin for delivery to the defendant’s site a truck DT35002: Document 22, p 34. There was no rental agreement in respect of the tip truck DT35002 in evidence. On 30 November 2007 there was an invoice (Document 23) in respect of the rental for the period 2‑18 November 2007 of this vehicle for $15,642.83 sent to the defendant, of which $2,178 was paid on 10 December 2007; the balance of this is outstanding: Exhibit 5.
- [20]There was a further roller delivered to the defendant on or shortly after 30 October 2007, unit RS15009: Document 19. Hire was charged on this unit on 8 November 2007, by invoice of 30 November 2007 for $9,658, and invoice of 19 December 2007 for $6,316.20: Documents 20, 21. These amounts have not been paid: Exhibit 5. In addition, in an invoice of 31 January 2008 which also dealt with RS12016, a charge was made for hire from 7‑12 January 2008, and for supply of fuel and some repairs after the unit was returned to Darwin: Document 18. As a result, there was a further $3,072.40 owing in respect of this unit, which has not been paid: Exhibit 5.
Stand-downs
- [21]The provisions printed on the documents in evidence setting out the terms of hire state that the hire charges are payable in respect of the whole period of the rental, regardless of whether or not the equipment is actually used. Document 4, a rental agreement dated 16 July 2007, provided in Clause 18:
“Period of hire – we charge for the time out not time used. Hire period commences from the time the equipment leaves our depot until its return to our depot. In the event of non-use due to wet weather, the company may reduce the charge, provided advice is received by 9 am each and every day concerned. The company may, in such event, terminate the hire and return the machine to one of its branches. Plant not returned by 8.30 am will be charged as an extra day.”
- [22]Later in the year there was a change in the wording of the terms and conditions, but the replacement terms and conditions were in this respect in substance the same. Exhibit 4, said to be the new terms and conditions,[11] provided relevantly as follows:
“All rental periods commence from the time the plant leaves the company’s depot and until its return to the company’s depot. In the event of non-use of the plant due to wet weather, the company may reduce the charge subject to the renter advising the company’s nominated person by 9 am on each and every day that non-use occurs. The company may, in such event, terminate the rental and return the plant to its depot. Plant not returned by 8.30 am will be charged as an extra day at the appropriate rate as determined by the company from time to time.”
- [23]Several things may be said about these provisions. First, they are limited to non-use due to wet weather. Second, they do not provide a right to reduce the rental charge but provide that the company “may reduce” the charge, which would give the company a discretion. Third, they are subject to advice prior to 9 am on each and every day that the non-use occurs. Fourth, they give the company the option in such circumstances of terminating the rental and recovering the plant.[12]
- [24]It is immediately apparent that this is not consistent with the notion that the renter or hirer is not to be charged if on any particular day the equipment is not in fact used. Yet the defendant’s claim for stand-downs appears to be based on the proposition that it is entitled not to be charged whenever the equipment was not in fact worked. This is the basis of the claim in the email of 31 January 2008, Exhibit 13, which was the first occasion on which a claim in relation to this matter was formulated and put forward by the defendant to the plaintiff: p 31. Mr McPartland said that if there is no work and you cannot work, you have got to stand it down or off-hire it: p 113. He said that he would telephone the Darwin manager and tell him what vehicles had not worked, and the Darwin manager had indicated that they would be off-hired or stood down. He said that he kept records of what was working so that he could charge the company for which he was performing the contract, and produced copies of his invoices to that company which set out the days on which equipment was worked and for which he charged that company: p 113, Exhibit 10. Clearly, therefore, the defendant’s claim is based on the notion that the plaintiff was not entitled to charge for the equipment on days when it was not used by the defendant. The defendant did not claim and made no attempt to prove that the various dates on which the equipment was not worked as set out in Exhibit 13, or as not charged for in Exhibit 10, were in any way related to wet weather, and it is inconceivable with the large number of days claimed that that was the case.
- [25]There was a subsidiary issue, in that that the defendant said that the Darwin manager had agreed to stand down notification being given weekly instead of the daily notification required by the contract.[13] Even if the manager did agree to this, which in the circumstances I am prepared to accept, and if he had authority to bind the plaintiff by such agreement, which I do not accept, this would not remove the limitation that the stand down be based on non-use due to wet weather. Unless that occurs, any such agreement would not assist the defendant.
- [26]On the face of it the defendant’s claim is quite inconsistent with the standard terms and conditions which I have found were incorporated into the contract of hire, which was formed by the defendant’s requesting the equipment and the equipment being delivered to the defendant and then being used by the defendant. Indeed, even if those standard terms and conditions were not incorporated into the contract, I consider that the ordinary term implied into a contract of hire of equipment would be that the hire was payable by reference to the time the equipment was in the possession of the hirer, rather than by reference to any actual use made of the equipment by the hirer. It would be obviously impractical for someone like the plaintiff to make valuable equipment available to a hirer on the basis that the hirer only had to pay for the equipment on those particular days when it chose to use it, because the hirer might in fact make little or no use of the equipment during lengthy periods. That certainly sounds inconsistent with any other contract of hire that I have ever heard of. Mr McPartland said that he had contractual terms in his contracts to protect him from stand-downs: p 112.
- [27]No real attempt was made to establish that this was a general practice. At one point, Mr McPartland claimed that there was a common practice about stand-downs (p 25), but I do not regard this as proper evidence of any general practice in the industry such that there would be implied a term into any contract of hire that such practice would be followed.[14] It may be that the difficulty for the defendant in relation to this contract arose because it had contracted to hire equipment from the plaintiff on a per day basis rather than on the basis of days worked, but was being paid by the company that had engaged it only on the basis of the days equipment worked. That would provide an explanation for the failure of the defendant to pay, but does not provide any justification for that course.
- [28]Mr McPartland also gave evidence to the effect that when he rang up the Darwin manager that manager agreed to this course: p 109. The plaintiff’s evidence was that the Darwin manager had no authority to agree to stand-downs (p 21, but see p 56), although he did have authority to communicate the plaintiff’s decision in relation to stand-downs to hirers, and hirers were expected to deal with the local branch: p 78-9. In these circumstances the Darwin manager would have been the plaintiff’s agent for the purposes of communicating with the defendant what the position was in relation to stand-downs, but would not have had authority to vary the terms of the contract between the plaintiff and the defendant.[15]
- [29]I do not accept that the contract as originally made was one on the basis of which the defendant was entitled to a stand-down whenever the equipment was not in fact used. That is inconsistent with the written terms which I have found to be incorporated into the contract, and would in any event be inconsistent with a contract of hire in the absence of some special agreement to that effect, which was not proved. As to whether the Darwin manager was telephoned and did purport to agree to such stand-downs, the individual concerned was not called on behalf of the plaintiff, and the plaintiff successfully objected to a statement by that individual being put in evidence by the defendant. In these circumstances I consider that I am entitled to draw the inference that, had that individual given evidence, his evidence would not have assisted the plaintiff,[16] and I am therefore prepared to accept Mr McPartland’s evidence about what actually passed between him and the Darwin manager in relation to stand-downs. The issue then becomes whether that is binding on the plaintiff.
- [30]In my opinion it is not binding on the plaintiff. This was not a situation where the Darwin manager had been purporting to agree to stand-downs within the terms of the contract between the parties, but rather was purporting to allow stand-downs in a way which was inconsistent with the terms of the contract between the parties. The Darwin manager had no authority to do that, and there is no reason to think that the plaintiff had ever held out the Darwin manager as having authority to do that. Accordingly the plaintiff is not bound by any purported agreement by that individual to allow stand-downs which were not consistent with the terms of the contract of hire. Accordingly, the defendant is not entitled to the stand-downs which were claimed.
Insurance surcharge
- [31]Each of the plaintiff’s invoices in respect of the relevant hiring included an additional 10% over the rental amount described as “damage waiver”. The original terms and conditions of the plaintiff[17] included the following provisions:
“14. The hirer acknowledges that the rates for hire of the plant do not include any provision for insurance on behalf of the hirer. The legal liability of the company arising out of the plant is covered by third party property damage cover, by public liability cover (with unlimited common law cover), when plant hired is operated by the company. The hirer indemnifies the company in respect of any loss or damage caused by or in the course of or arising out of the use of the plant once the plant has left the bounds of a recognised road, and has entered a third party’s property.
- 15.If the hirer chooses to take the benefit of the damage waiver option and the equipment is lost or destroyed, the hirer will be liable to the owner for an excess of $5,000 per claim. The damage waiver will only be available if the destruction or damage of the equipment is caused by fire, storm, earthquake, collision or accident. The damage waiver will not apply to the damage of equipment in the following circumstances: [A list of seven specific circumstances, which need not be reproduced.]”
- [32]The new terms and conditions of hire (Exhibit 4) were to different effect. The relevant provisions were:
“27. The company reserves the right to charge the renter a percentage premium of the value of rental as insurance for accidental damage to the plant. The company reserves the right to amend the percentage premium from time to time without prior notice to the renter.
- 28.Subject to the provision of suitable documentation confirming the renter’s insurance coverage the company may at its absolute discretion agree to an exemption from the damage waiver charge for the renter.”
- [33]The new terms and conditions then went on to provide for an excess of $5,000 per claim if the damage waiver premium had been paid, limiting damage waiver to destruction or damage of the equipment caused by fire, storm, earthquake, collision or accident, and excluding damage of equipment in certain specific circumstances. According to the plaintiff’s evidence, these terms and conditions came into operation on 1 December 2007: p 17.[18] However, the rental contracts in relation to each of the items of equipment referred to in these proceedings, the two rollers and four trucks, were entered into prior to December 2007. The first roller RS12016 and the first three tip trucks were hired from July 2007, and the second roller and the remaining tip truck were hired from November 2007.
- [34]On the scenario referred to earlier, where there was no specific written contract of hire, but the plaintiff had made known the terms upon which it would hire equipment to the defendant so that by offering a piece of equipment for hire and its acceptance and use by the defendant a contract was made on the plaintiff’s standard terms, those contracts were all made at the point when the defendant accepted the equipment and began to use it, at the latest. All of these contracts were therefore made before the terms and conditions changed. Once a contract has been entered into on particular terms, it is not open to one party to the contract unilaterally to substitute a different set of terms and conditions, and there was no evidence that the defendant ever agreed to vary the contracts of hire to bring them into line with the new terms and conditions. There was nothing to suggest that the way in which the system worked was that a new contract of hire came into operation each month, or for some other period; rather, the situation was that the equipment was hired for a period and invoices were sent each month, or at the end of the hiring.
- [35]Accordingly, the relevant terms are those of the earlier terms and conditions. They did not make any automatic provision for a loading to be payable by the hirer in respect of “damage waiver”; rather, it was a matter for the hirer to arrange for that to occur, but there was no evidence that any such arrangement was ever made in respect of the hiring of any of these pieces of equipment. Indeed, the defendant’s evidence was that it had provided copies of its own insurance documentation to demonstrate that it had appropriate cover, which had been accepted by the Darwin manager as satisfactory. That would be quite inconsistent with any such arrangement for payment of “damage waiver” having been made.[19] In these circumstances, the plaintiff was and is not entitled to charge the 10% loading for “damage waiver”.
- [36]The statement of claim proceeded on the basis that the plaintiff is suing in respect of a list of specific invoices, invoices 5002270, 5002271, 5002484, 5002485, 5002486, 5002809, 5002810, 5002816, 5002817, 5002818, 5003143, 5003144, 5003215, 5003216, 5003461 and 5003462. These total $226,739.68, which is said to be the amount of the claim outstanding; an amount of $45,000 has subsequently been paid pursuant to a partial summary judgment. The defendant’s defence alleged overcharging in respect of these particular invoices. The amended defence went on to seek to set off against the amount claimed by the plaintiff an amount by way of damage waiver of 10% of $357,230.35. How that figure was arrived at was not explained in the pleading. It may be that this was the 10% which was included in the sum of $392,953.58 said to be the total amount of all invoices from the plaintiff since October 2006. In paragraph 6 of the reply filed 8 September 2011, the plaintiff joined issue with paragraph 5 of the amended defence which contains these allegations, and alleged that the plaintiff was entitled to charge damage waiver on each of the relevant invoices. There was, however, no admission that the amount of all invoices from the plaintiff since October 2006 was $392,953.58, including the amount charged by way of damage waiver. There was no evidence to support that figure; the only invoices in evidence are those listed in the statement of claim, and two invoices for DT40011 in Exhibit 8.
- [37]The document number in Exhibit 1 of each invoice, the invoice number, the amount included in the invoice by way of damage waiver, and the total amount charged by the invoice appear from the following table:
Document No. Invoice No. D/W Amt charged
44 5002270 2,610.00 31,581.00
32 5002271 2,610.00 31,581.00
11 5002484 567.00 6,860.70
47 5002485 2,160.00 26,136.00
36 5002486 1,710.00 20,691.00
23 5002809 1,260.00 15,642.83
20 5002810 580.00 9,658.00
14 5002816 493.50 5,971.35
49 5002817 2,250.00 27,225.00
38 5002818 2,250.00 27,225.00
39 5003143 1,170.00 14,242.80
21 5003144 522.00 6,316.20
17 5003215 336.00 4,065.60
51 5003216 1,530.00 18,513.00
52 5003461 450.00 6,170.06
185003462 279.004,561.80
Totals: $20,777.50 $256,441.34
- [38]This produces a total amount charged by way of damage waiver of $20,777.50. There was, however, a credit adjustment in Document 24, which reduced the amount claimed and included $180 in respect of damage waiver, which should be deducted, leaving a balance of $20,597.50. The two invoices in Exhibit 8 charged amounts of $630 for invoice 5001700 and $225 for invoice 5001681 for damage waiver. When these are added the total from Exhibit 1 comes to $21,452.50. These additional amounts are recoverable although these invoices were paid, because it is not clear that the defendant knew it was then paying an amount for “damage waiver”, which would make these amounts irrecoverable as a voluntary payment in response to a bona fide demand.
- [39]GST was charged on the damage waiver amount, so a further 10% loading needs to be added to give the total amount included in the invoices inclusive of GST in respect of damage waiver of $23,597.75. If, as I have found, the plaintiff was not entitled to charge the defendant the damage waiver loading, it follows that the plaintiff has overcharged in respect of the specific invoices referred to in the pleadings the sum of $22,657.25 for damage waiver, and a further amount of $940.50 was proved to have been paid for damage waiver, which is recoverable.
- [40]Subject to that, the plaintiff is entitled to recover the balance payable on the invoices, which comes to $226,739.68.[20] Deducting the $45,000 already paid and the $23,597.75 in respect of damage waiver, the balance is $158,141.93. The plaintiff also claimed interest pursuant to Clause 5 of the contract at a rate of 1.5% per month, from 31 January 2008. The relevant terms and conditions of hire on the back of Document 4 provide for interest at the rate of 1.5% per month on any amounts as may from time to time be overdue until paid. This was said to be on daily balances, but the process of calculating daily balances over a period from 31 January 2008 is too complicated and I will allow only simple interest at 18% per annum.
- [41]The amount of $45,000 was paid in September and October 2009, so I will allow interest on the amount owing without deducting the $45,000 for 20 months and then interest on the balance after deducting the $45,000 for a further 43 months, which brings it up to the end of June. This is slightly too long, but the calculation of interest as simple interest rather than compounding on daily balances is to the benefit of the defendant. The amount payable prior to the payment of $45,000 was $203,141.93, and interest at 18% per annum for 20 months on that amount comes to $60,942.57. After payment of the $45,000 the balance was $158,141.93 and interest on that amount at 18% per annum for 33 months comes to $78,280.25. The total amount payable therefore by way of interest comes to $139,222.82, so the plaintiff is entitled to judgment for $297,364.75, including $139,222.82 by way of interest.
Footnotes
[1] See Exhibit 1 Document 23; Sherrin p 63. Exhibit 1 is a bundle of documents all of which were proved in evidence: I shall refer to them by their document numbers.
[2] Sherrin p 9; McPartland p 29
[3] Mr McPartland denied that he in fact knew of the terms and conditions: p 24. He may well not have taken the trouble to find out about them, but they were available on documents supplied to the defendant, and the question is what each party would reasonably conclude from the conduct of the other.
[4]Hays Personnel Services (Aust) Pty Ltd v Motorline Pty Ltd [2008] QCA 375.
[5] A.J. Lucas Operations Pty Ltd v Mac-Attack Equipment Hire Pty Ltd [2009] NTSC 48; reversed on appeal [2009] NTCA 4, where at [23] it was said that in that case the rental agreement was executed by both parties.
[6] Exhibit 6: McPartland p 27, which I accept.
[7] He was aware of the damage waiver provision, and to some extent about the stand-downs: p 25.
[8] Copies of the invoices for October to January were documents 11, 14, 17 and 18. The January invoice also covered the second roller RS15009.
[9] The September, October, November and December invoices were documents 32, 36, 38 and 39.
[10] The July invoices were Exhibit 8. The September, October, November, December and January invoices were documents 44, 47, 49, 51 and 52.
[11] Sherrin p 17.
[12] For how this worked in practice, see Sherrin p 21, p 27-8. There can be a partial “stand down”: p 36.
[13] McPartland p 111. See Sherrin p 89: the manager did not have authority to agree to this.
[14]Con-Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Aust) Ltd (1986) 160 CLR 226 at 236.
[15] See also Sherrin p 57, p 89.
[16]Jones v Dunkel (1959) 101 CLR 298. There was evidence that he had resigned from the plaintiff’s employ: p 54.
[17] Exhibit 1, Document 4; Sherrin p 16, referring to Document 4.
[18] There are documents in evidence dated before this which have the new terms and conditions on the back, eg Document 23, Exhibit 8. The explanation appears to be that they were recently reprinted on the new stationary.
[19] McPartland p 25, p 33. I accept that this occurred. Two quotes given to the defendant by the Darwin manager of the plaintiff in February 2007 refer to “10% Damage Waiver (you may supply your own insurance)”, suggesting that this was something arranged on a case by case basis.
[20] The balance of $181,739.68 in Exhibit 5, plus $45,000.