Brodie Agencies Pty Ltd v Edwards
[2015] QDC 256
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- Unreported Judgment
- Brodie Agencies Pty Ltd v Edwards[2015] QDC 256
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Brodie Agencies Pty Ltd v Edwards[2015] QDC 256
Brodie Agencies Pty Ltd v Edwards[2015] QDC 256
DISTRICT COURT OF QUEENSLAND
CITATION: | Brodie Agencies Pty Ltd v Edwards [2015] QDC 256 |
PARTIES: | BRODIE AGENCIES PTY LTD (plaintiff) v ANDREW DARCY EDWARDS (defendant) |
FILE NO/S: | 1176 of 2014 |
DIVISION: | Civil |
PROCEEDING: | Trial |
ORIGINATING COURT: | Queensland District Court at Brisbane |
DELIVERED ON: | 14 October 2015 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 1, 2 June, 24 July, 4 September 2015 |
JUDGE: | Butler SC DCJ |
ORDER: |
|
CATCHWORDS: | CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – IMPLIED TERMS AND CONDITIONS – where there was a contract for purchase of cattle – where a further agreement was signed varying the quantity and price – where the defendant did not make payment for cattle delivered – where the plaintiff is seeking orders for recovery of the cattle and payment of the outstanding debts – where the defendant counterclaims for breach of contract and misleading or deceptive conduct Competition and Consumer Act 2010 (Cth) ss 18, 20 Sale of Goods Act 1896 s 16 |
COUNSEL: | A.C. Harding for the plaintiff Self-represented defendant |
SOLICITORS: | Macpherson and Kelly Lawyers for the plaintiff Self-represented defendant |
- [2]The defendant, Andrew Edwards, was in the business of trading and breeding cattle. He entered into a contract dated 6 July 2013 for the purchase of 1,100 heifers and 400 steers on behalf of Warana Pastoral Company. The other parties to the contract were Deracroft Pty Ltd (the vendor), that supplied the livestock, and Brodie Agencies Pty Ltd (the plaintiff), a stock and station agency.
- [3]Approximately 1,220 cattle were delivered of which about half were steers. The contract provided for payment to be made in three instalments over a nine month period. Upon receipt of the cattle the defendant asserted they were light in weight. He contended the average weight of the cattle fell below that described in written and oral communications to him by the vendor’s agent prior to the contract being signed.
- [4]Following the defendant’s complaint the parties engaged in negotiations and a further agreement dated 12 August 2013 was executed. That agreement was for the sale of the 610 steers and 609 heifers already delivered to the defendant at a reduced price per head. Payment was to be made in three instalments, the last due 12 June 2014.
- [5]The defendant has made no payment whatsoever for the cattle.
- [6]The plaintiff sues for a debt due and owing in the sum of $329,157 and seeks further relief by way of orders for the preservation, recovery and sale of the cattle delivered.
- [7]Although Brodie Agencies Pty Ltd was the vendor’s agent in the sale it now brings the action as plaintiff in reliance upon a written assignment by the vendor of all rights and entitlements under the contract. The defendant was given notification of that written agreement.
- [8]The defendant appeared on his own behalf at trial. Although the defendant was not legally represented before the court, his pleadings were prepared by a solicitor and he relied on written submissions prepared by a solicitor for his final address.
- [9]The defendant counterclaims asserting a breach of express or implied conditions of contract and/or misleading or deceptive conduct in contravention of s 18, schedule 2 of the Competition and Consumer Act 2010 (Cth) (“the Australian Consumer Law”). He also alleges a breach of s 20 of the Australian Consumer Law.
- [10]The defendant, relying on alleged misrepresentations by the plaintiff as to the weight of the cattle, claims damages for breach of contract and contravention of the Australian Consumer Law.
Background
- [11]The plaintiff company, in its role as stock and station agent, acted for Deracroft Pty Ltd to offer cattle for sale. The cattle were initially advertised on the plaintiff’s website as 400 steers and 1,100 heifers. The website advertisement described the steers as follows:
“Agent Comments
400 brahman/charbray strs for sale. Mostly number 2s with a percentage of number 1s. 40-50% are charbray or crossbred with the balance being brahman. All have been weened properly and are good to handle in and out of the yards. They are in store condition and are proven finishing cattle when shown good feed. The strs look to average about 310kg curfewed, there are scales available if a buyer wishes to weigh a percentage of the cattle. Asking $380.00 + GST on farm ($1.23/kg) roughly”
- [12]Under the heading “weight range” the advertisement stated “250-380kg”.
- [13]The advertisement for the heifers read as follows:
“Agent comments
1,100 brahman/charbray hfrs for sale. Hfrs mostly brahman with about 40% being charbray and/or Droughtmaster cross. They will range between 200 and 350kg. Cattle are well handled and do respond quickly to feed. There will be a percentage of number 1s in the mob, vendor is open to all offers given the variation in age and weight of the cattle. Asking $280 on farm.”
- [14]The advertisement for the heifers stated “200-340kg” under the heading “weight range”.
- [15]The defendant at the time was utilising Matthew Peters of Landmark Charleville as his stock agent. Mr Peters brought the availability of these cattle to the defendant’s attention. He on-forwarded, to the defendant, an email he received from the plaintiff’s representative, Mr Josh Phelps. The copy tendered in evidence only related to the heifers. It read:
“Approximately 1,100 brahman and crossbred hfrs for sale. They mostly number 2s with about 10% being number 1s. they will range in weight between 220 and 360kg. About 40% will be crossbred types predominately by Charbray bulls with the balance being Brahman. The vendor wants to sell as a mob but is open to all offers given the variation in weight and age of the cattle. They are in store condition and will respond well to feed, whether in a paddock or feed lot. There are scales available to weigh a percentage however the vendor wishes to sell the cattle $ per head on farm. Asking $340.00 + GST for a draft of the heavier hfrs (including number 1s) and two $280.00 + GST for the balance. Buyer must take at least 8 decks of the lead, minimum. Prices on farm 235km south of Longreach.”
- [16]At the direction of the defendant Mr Peters attended Maxvale, the property of Deracroft Pty Ltd, to inspect the cattle offered for sale. Mr Peters carried out a visual inspection of a selection of the cattle.
- [17]The defendant’s evidence is that he instructed Mr Peters to make an offer of $300 per head for the steers and $250 per head for the heifers. The offer was not accepted and the defendant increased his offer to $330 per head for the steers and $270 per head for the heifers. Agreement was reached at that price. A written contract dated 6 July 2013 was forwarded to the defendant who signed and returned it by email on 7 July 2013.
The Issues
- [18]The plaintiff and defendant are in dispute as to the nature of the contract they entered into. The plaintiff contends that the parties entered into a contract on 6 July 2013 which the parties subsequently varied as to price and quantity only. The plaintiff contends that the defendant is obligated to pay for the cattle delivered in accordance with the contract as varied.
- [19]The defendant raises a series of objections to the plaintiff’s claim and counterclaims. He asserts that the plaintiff breached the original contract by failing to supply cattle as represented. In support of that contention he argues that representations as to the average weight of the cattle were incorporated as terms of the contract. He also submits that the plaintiff’s representations as to weight were misleading or deceptive. The defendant seeks to rely upon the initial 6 July 2013 contract and submits there was a breach of that contract. Furthermore, the defendant denies that standard contract terms were incorporated into the 6 July contract. He denies that a subsequent written agreement varied that contract and argues that a new contract involving different parties was entered into.
Contract of 6 July 2013
- [20]The contract of 6 July 2013 was signed by the defendant on behalf of Warana Pastoral Company. It has emerged that Warana Pastoral Company was never registered as a company or business. Nothing turns on this. The defendant at all times acted on behalf of that entity and he admits he is personally liable for discharge of obligations under the contract.[1]
- [21]While the defendant admits he entered into the contract of 6 July 2013 he disputes the terms of that contract.
Did the contract incorporate standard terms and conditions?
- [22]The plaintiff submits the contract incorporated standard terms set out on a printed Australian Livestock Agents Association Limited recommended standard sale contract form. Mr Peters of Landmark, Charleville acted as the defendant’s agent in the negotiations.[2]The defendant negotiated through Mr Peters and initially had no direct contact with the other parties. The defendant admitted signing the contract which was received in evidence[3]. The following facts were not disputed by the defendant:
“10. That at the time that the contract was signed by the defendant, Landmark Operations Limited or Landmark Charleville was in possession of the Australian Livestock and Property Agents Association Limited’s recommended standard private sale contract terms and conditions.
- That at the time that the contract was signed by the defendant, Landmark Operations Limited or Landmark Charleville was aware that the contract incorporated the Australian Livestock and Property Agents Association Limited’s recommended standard private sale contract terms and conditions.”[4]
- [23]At trial the plaintiff tendered without objection a complete blank copy of the contract form with the standard terms. I described the document being tendered to the defendant, who was appearing by telephone on his own behalf, in the following terms:
“What’s been handed to me is a copy of the printed form, Mr Edwards, which shows that the contract had two pages, second page continuing on with the various clauses which are terms for the contract agreement. As I understand it, what’s been relied upon is that the contract that you signed on the 6th of July 2013 consisted of the two pages, including the terms which are set out on the printed form.” [5]
- [24]This interaction with the defendant followed:
| “DEFENDANT: | Your Honour, re those two pages, you – are you meaning the back of the contract? |
| HIS HONOUR: | Yes. It’s been given to me as two separate photocopies, but I assume it would have been printed on the back of the printed sheet. |
| DEFENDANT: | Yeah. Yeah, your Honour, I fully understand. Being a livestock agent and run me own business, I understand the terms and conditions on the contract. The problem was the actual original contract wasn’t delivered. The cattle were never – were never there to be delivered. |
| HIS HONOUR: | Yes. |
| MR HARDING: | So that’s not controversial, your Honour. I’ll tender that as the --- |
| HIS HONOUR: | Well, yes I receive that as Exhibit 3 the form of contract showing terms.” |
- [25]On inspection there is no apparent discrepancy between the printed form visible in Exhibit 2 and page one of Exhibit 3.
- [26]In written submissions the defendant now argues that the plaintiff has not proved that the terms in Exhibit 3 were the relevant standard terms and conditions adopted in the agreement entered into on 6 July 2013. That submission cannot be accepted. The defendant in his pleadings and conduct of the case did not dispute that all parties to the agreement accepted the contract incorporated the Australia Livestock and Property Agents’ standard terms and conditions.
Was a description of the weight of the cattle incorporated as a term of the contract?
- [27]The defendant submits that the descriptions of the weight of the cattle contained in the website advertisements, as confirmed in oral conversations between Mr Peters (as agent for the defendant) and Mr Phelps (as agent for the vendor), were incorporated as terms of the contract.
- [28]The evidence before the court of current commercial practice is that cattle are offered for sale in one of two ways; price by weight or price per head. The standard contract form makes provision for those options. The written contract was for “price on farm per hd”.
- [29]The standard contract terms provided:
“Price determined prior to delivery
3.1 Where the Price is to be determined prior to delivery it shall be determined in accordance with the method indicated in the Contract Particulars (and/or annexed price grid) and by reference to the actual quantity of Livestock delivered to the Purchaser.”
…..
Quantity
19.1 Should there be any discrepancy in numbers of any livestock sold the vendor or the agent shall not be bound to deliver more than the number actually in the possession of the Vendor or the Agent and the Purchaser shall not be bound to accept any number of Livestock in excess of 10% of the number set out in the contract particulars.
19.2 The actual number of Livestock delivered to the Purchaser shall be determined by a muster and count prior to delivery.
19.3 The purchaser shall be entitled at the time of the count and before delivery but not afterwards, to reject any animals that are blind, maimed, diseased or unfit to travel and/or do not meet the livestock movements requirements of any relevant legislation.”
- [30]The defendant seeks to rely on alleged representations by Mr Phelps to Mr Peters. An email from Mr Phelps dated 26 June 2013 referred to 1,100 heifers. It described them in similar terms to the web page advertisement but added:
“There are scales available to weigh a percentage. However the vendor wishes to sell the cattle dollars per head on farm.”
- [31]In addition the defendant submits oral representations made by Mr Phelps to Mr Peters and then communicated to him were incorporated as terms of the contract. In his affidavit Mr Edwards said:
“After I read the advertisement I rang Matt Peters back and we discussed the weights and market value of the cattle. I said to Matt that the heavy cattle, by this I mean steers at 310 and heifers at 270, needed to be included in the deal for it to be viable. I made clear that the heavy cattle had to be there and Matt said Josh Phelps has guaranteed him that the weights are right”[6]
Mr Edwards’ testimony before me was that Mr Peters relayed back to him “the description of the cattle given to him by Josh Phelps in his own opinion.”[7]He said, “Josh Phelps guaranteed that all the heavy cattle would be there.”[8]Those claims are inconsistent with the testimony of Mr Phelps and Mr Peters.
- [32]Mr Phelps testified that he prepared the advertisements and email to potential buyers from his own observation of a sample of 300 to 400 of the cattle for sale. He said that when contacted by Mr Peters he advised him to look at the cattle, told him the only way they would sell the cattle was if he looked at them and drove with him to inspect a sample. He said he showed Peters a sample of approximately 450 to 600 cattle and offered to weigh some. He testified that motorbikes and scales were present and that he offered to weigh a sample of 100 cattle but Mr Peters said that would not be necessary.
- [33]It was put to Mr Phelps under cross-examination that he guaranteed “the weight of the steers was there.” He responded:
“I never guaranteed anything. I explained very clearly that there were scales available if a buyer wanted to weigh the cattle and those scales were rejected.”[9]
Mr Peters testified he inspected the cattle on the instruction of Mr Edwards.[10]Mr Edwards agreed that he asked Mr Peters to view the cattle in order to make an assessment.[11] He did not ask him to weigh the cattle.[12]
- [34]Mr Peters gave the following evidence:
| “Q. | Did you – when you were inspecting the cattle, again your assessment as to whether the cattle you were inspecting corresponded or consistent with what had been advertised? |
| A. | I believe the cattle Josh pointed out to me were consistent with his advertisement. |
| Q. | Now, at the time that you were inspecting the cattle with Mr Phelps, were you aware whether you could weigh any of the cattle if you wished to do so? |
| A. | Josh suggested if we wanted to, it would – it would be possible to do so, but it would have been difficult with such a large mob of cattle and I didn’t think it was necessary at the time. |
| Q. | So can I just get you to clarify that. So you made an assessment you didn’t think it was necessary? |
| A. | Yes. |
| Q. | Is that based on your inspection-‑‑‑‑? |
| A. | Yes. |
| Q. | ---of the cattle? |
| A. | Yes.”[13] |
- [35]Mr Peters was then asked what he told Mr Edwards. His response was:
“I told Mr Edwards that what I saw were what were advertised, that they seemed to be consistent with the advertisement that Josh had put out.”[14]
- [36]The following question was asked of Mr Peters:
| “Q. | …when you went and looked at the cattle, based on your experience, were you advising on whether the price that was to be offered for the cattle was correct value for the cattle you saw? |
| A. | Yes. Yes. I believe they were – the value that Josh had put on them was correct and true to market at the time. Maybe a little bit below price, if anything.”[15] |
- [37]There is consistency between the accounts of Mr Phelps and Mr Peters. Their accounts conflict with that of Mr Edwards. I have had the opportunity to assess each witness as he gave evidence. I accept the testimony of Mr Phelps that he sought to accurately describe the cattle offered and that the sale was made subject to inspection by the buyer. I accept the testimony of Mr Peters that he formed an opinion based on his inspection of a sizeable sample and communicated that opinion to Mr Edwards. Where there is conflict I prefer the evidence of Mr Phelps and Mr Peters over that of Mr Edwards. In particular I do not accept that Mr Peters told Mr Edwards that Mr Phelps guaranteed that “the weights were right” or that “the heavy cattle would be there”.
Contract terms and conditions
- [38]The defendant’s evidence was that he bought the cattle having calculated a business case which assumed that 500 of the 1100 heifers, each with a starting weight of 304kg, could be sent immediately to feedlot for fattening and assumed that 200 of the 400 steers, each with a starting weight of 330kg, could be immediately sent for fattening. It is his contention that the terms of the contract he entered into justified his making these assumptions.
- [39]Given my preference for the testimony of Mr Phelps and Mr Peters as to the absence of relevant oral representations, it is necessary to look to the written documents to determine the terms of the contract.
- [40]The written contract set a price on a per head basis rather than per kilogram of weight. The written contract contains no express term as to the weights of the cattle. The known background circumstances were that the cattle for sale were un-mustered and grazing over a 150,000 hectare property and the standard terms of the contract recognised that the number of animals available may vary after muster.
- [41]Turning to the advertisements and email, they make express representations as to the weight range of the steers and heifers respectively.
- [42]The web page advertisement for 1100 heifers says:
“They will range between 200 and 350 kilograms. … The vendor is open to all offers given the variation in age and weight of the cattle.”
- [43]The advertisement for 400 steers:
“The steers look to average about 310kg curfew, there are scales available if a buyer wishes to weigh a percentage of the cattle”.
The weight range for the steers was given as “250-380kg”.
- [44]These are express representations that the cattle to be sold would fall within stated weight ranges. They placed a bottom limit on the weight of the cattle sold. In my view it may be concluded that the representations as to weight ranges are implied conditions of the contract. The weight of the cattle was crucial to their value in the marketplace. A buyer would need to have a means of gauging the value of the cattle in order to offer a price for them. Those implied conditions are necessary to give business efficacy to the contract and they do not contradict any express term.
- [45]The defendant also relies on an implied condition under section 16 of the Sale of Goods Act 1896 that the cattle were sold by description and should correspond to that description. I find that the cattle were sold by description by reference to the weight ranges of the two categories being sold and in each case that range was a condition of the contract.
- [46]The plaintiff relies on the offer of inspection of a sample as showing it was not intended by the parties that the cattle were to be sold by description. However, an offer of inspection will not avail a vendor if variation from the description would not be apparent on inspection: Lockhart v Osman [1981] VR 57. The inspection here was not capable of informing the buyer whether all the animals for sale fell within the promised weight range.
- [47]The defendant seeks to also infer from the advertisements that it was a condition of the contract that the average weight of the steers would be 310 kg per steer and 270 kg per heifer. The advertisement for the steers said that they “look to average about 310 kg curfew.” On an objective reading, the average weight was expressed as a qualified estimate. It was further qualified by the immediate offer of scales to weigh a sample. An informed buyer would have appreciated that given the size of the herd it would not be expected that exact information would be available prior to muster. I conclude that the phrase in the advertisement was an expression of opinion and not a description of the goods for sale constituting a term of the contract.
- [48]The defendant also argues that the weight ranges give rise, without more, to representations as to the average weight of the cattle for sale. To say that a herd of cattle will range in weight between 200 and 350kg does not convey any representation as to the percentage of cattle falling higher or lower in that range. It simply represents that all the cattle offered fall within those parameters and that some will fall towards either extremity. Therefore it cannot of itself amount to a representation as to the average weight of the herd of cattle. The email describing the heifers does not assist the defendant in so far as it warns of variation in weight and age of the cattle.
- [49]I conclude that the contract of 6 July 2013 did not incorporate as a term of the agreement a representation as to the average weight of the cattle. However, it was an implied term of the contract that the cattle in each group would fall within the specified weight range for that group.
The deliveries
- [50]The cattle were delivered to the defendant’s property Warana in five operations from 19 July 2013 to 26 July 2013. Because the cattle were sold “on farm” their transport was the responsibility of the buyer. The transport arrangement negotiated on behalf of Mr Edwards necessitated movement of the cattle over a number of days. The cattle travelled 700 hundred kilometres between the properties.
- [51]Immediately following receipt of the first load of cattle Mr Edwards raised concern through his agent Mr Peters that the cattle delivered were lighter than what he was expecting. Mr Peters testified that he was present when the second load of cattle arrived. He agreed that the cattle looked a lot lighter than when he had inspected them in the paddock at the vendor’s property. Mr Peters was of the opinion that this loss of weight was “natural and normal” after the passage of time involved in the long journey.
- [52]Mr Peters said that the defendant asked him to make contact with Mr Phelps and asked for heavier cattle to be included in subsequent loads. As those loads were received Mr Edwards told him that the cattle were not getting any heavier. There is a suggestion from the evidence that efforts were made to excise lighter cattle from the deliveries and that this may have affected the proportion of steers as against heifers in the mix. Mr Peters’ evidence is that ultimately the defendant asked him to renegotiate the contract and to ask for the price of the cattle to be reduced. Mr Peters said that in communicating this to Mr Phelps he was negotiating on the basis that if an agreement could be reached that would be the end of the dispute.
- [53]An email from Mr Edwards to both agents was tendered.[16]Mr Peters says that the email was consistent with instructions he had from the defendant. It read:
“Josh
After speaking with Mat again I will make the following offer based on the cattle received weights.
Strs $297 per hd on farm.
Hfrs $243 per hd on farm.”
- [54]The defendant weighed the cattle as they were received onto his property. In his affidavit he provided an average weight for each load (combining both steers and heifers) received at his property. The reported average weights for the loads ranged from 234kg to 257kg with 89 other cattle being an average weight of 280kg. As the evidence did not distinguish between steers and heifers it is not possible to make a sensible comparison with the weight ranges in the advertisements. However, it seems to be accepted that the cattle had lost weight in the process of mustering and transporting them. The advertisement spoke of curfew weight which, on Mr Peters’ evidence, meant 12 hours off food and water. Mr Peters was of the opinion that further weight loss was to be expected having regard to the time delay over which the cattle were transported.
- [55]It appears from the evidence that both stock agents were actively involved in the negotiations to reach an accommodation acceptable to the parties. The exact details of the arrangements involving them is not clear from the evidence but it seems both agents agreed to bear some financial responsibility to achieve a resolution.
Agreement of 12 August 2013
- [56]A further written agreement was prepared for sale of the cattle already received by the defendant; the 610 steers and 609 heifers. It refers to cattle “as already delivered”. The agreement was prepared on an Australian Livestock and Property Agents Association Standard Sale Contract form, June 2013 Edition. Although this form was a revision of the form used for the 6 July 2013 contract, all relevant terms are substantively the same. The price shown for the steers is “$302.775 + GST” and for the heifers “$247.775 + GST”, a total price of “$335,587.72 + GST”. An earlier version of the agreement was signed by Mr Peters for the defendant but the final version dated 12 August 2013 with amended dates for payment and including the entry “Revised Contract 9/9/2013” was signed by Mr Edwards.
- [57]Mr Edwards gave evidence that he entered into the agreement for the delivered cattle on the basis that it was not to replace the first contract dated 6 July 2013. The defendant in his affidavit describes the process of negotiation that preceded the execution of the further agreement:
“After raising the dispute with the plaintiff about the misdescription and low weight of the cattle Matt Peters asked me to work with them to make an offer for the cattle that had been delivered. I told Matt that I did not want to make an offer and that I wanted the cattle collected. After speaking with the plaintiff Matt told me that he could not do that. I then again asked for the heavy cattle to be delivered pursuant to the contract. Matt again after speaking with the plaintiff told me that he could not do this. Matt said to me that as the cattle were not going to be removed and that I should make an offer for the cattle that had been received. I said to Matt Peters I will make an offer on the cattle that have been delivered if they are refusing to take them however I still need to (sic) heavy cattle to be delivered as the purpose of the deal was to get the heavy cattle to put them into the feed lot. Matt Peters went back and forth with the vendor and it was ultimately agreed that the cattle that had been delivered would be reduced to the following prices.
- $297 for the steers; and
- $240 for the heifers.
I asked Matt Peters and Tony Williams from Landmark Charleville (who is Matt’s superior) on numerous occasions what is going on with the cattle for a period of almost one month. I did not receive any reply from either of them.
On 5 September 2013 I wrote to Matt Peters and Tony Williams by email advising as follows:
- Tony, In the livestock industry we do not have much to go on except for trust and signed contracts. (I want the heavy cattle as quoted) as to fulfil our obligations. Relevant to the cattle that should have been delivered, the revised terms are as follow 1/3 payment 12/12/13 and 1/3 payment 12/3/13 and 1/3 payment 12/6/13…
- Matt, I see you can read the payment part of the contract, please be advised there is a signed contract I suggest you start delivering to Warana Pastoral Company the correct cattle, between the weights and quality of cattle quoted and backed up by description emails and the internet you’re asking Warana Past Co to pay $27,553 all for nothing this equals an extra 10 months terms @ 10%. The last thing I will be doing is borrowing money and paying more interest on a mob of mis described cattle…”
- [58]The defendant went on to say that he received a contract from Brodie Agencies on 10 September 2013. The contract was dated 12 August 2013 on its face. Mr Edwards admitted signing and emailing back that contract.
- [59]He was asked the following question in cross-examination:
| “Q. | …and you worked out what you prepared to pay for those cattle and agreed to paying that price for those cattle? |
| A. | the actual price in that contract’s not correct Mr Harding. But the contract was signed under duress. I was actually trying to move cattle. Legally I did sell cattle. I have no contract signed. I probably wasn’t legally able to do that. All I wanted to do is get rid of the cattle ‘cause I couldn’t get them to shift them. No contract was signed. And it did not replace the first contract where I want my heavy cattle as quoted on Brody Agencies.” |
- [60]Mr Edwards’ evidence as to the course of negotiations is inconsistent with that of his agent Mr Peters. Indeed, Mr Peters denied that Mr Edwards ever instructed him that the cattle should be returned.[17]When it was put to Mr Peters that Mr Edwards said to him he had to remove the cattle he replied:
| “A. | I don’t recall, and I don’t believe we had that conversation. I – as far as turning – sending the cattle back or turning the trucks around, when I went down there the second time to inspect the cattle after their arrival, in frustration I said to Andrew, well, we’ll put them back on the truck and send them back where you came from, and I believe that’s the only thing I said about turning trucks around, sending them back to Maxvale, as no one would be able to afford or have the time or the – it just wasn’t – wouldn’t – it wouldn’t be able to have been – been done. |
| Q. | When you said that to Mr Edwards, what was his response? |
| A. | I don’t remember his response. |
| Q. | And do you recall him making any request of you to put that into effect? |
| A. | No.”[18] |
- [61]On this issue I prefer the evidence of Mr Peters. There is no evidence that Mr Edwards took any step at that time to communicate directly to the vendor or the plaintiff that he required the cattle to be removed. The evidence is that Mr Peters did not inform Mr Phelps of any rejection of the cattle.[19]
- [62]The question of fact to be resolved is whether the parties, in signing the agreement dated 12 August 2013, intended it to be a valid variation of the original contract discharging the vendor’s obligation under the original contract to supply the number of cattle specified and substituting the number already delivered and in return, discharging the defendant’s obligation to pay the original price per head and substituting a lesser price.
- [63]The defendant submits that the contract dated 12 August 2013 did not discharge the vendor’s obligations under the earlier contract. Under cross-examination Mr Edwards continued to assert that despite entering into the new agreement to accept the delivered cattle he at all times wanted the heavy cattle.
- [64]The difficulty with this assertion is that the 12 August agreement by the parties for purchase by the defendant of the 1211 cattle already delivered was in practical terms inconsistent with the original contract for purchase of 1500 cattle remaining afoot. As much is apparent even from what the defendant said under cross-examination. The defendant was asked what he meant when he said “I want the heavy cattle as quoted” in the email of 5 September. He replied:
“I wanted the heavy cattle quoted out of 1100 steers and the – 1,100 heifers and the 400 steers. I wanted the heavy cattle quoted out of them. The numbers, whether there’s 1050 or 410, was irrelevant. I wanted the heavy cattle as none had arrived.”[20]
- [65]Under cross-examination Mr Edwards agreed that he was prepared to purchase the cattle already on his property for the price that was negotiated in the later agreement.
- [66]I asked him the following questions:
| “Q. | But you say you also had an expectation that the earlier contract would be honoured in addition to that to supply you with heavier cattle? |
| A. | The heavier cattle to be delivered. |
| Q. | Yes and what were you expecting at the 10th of September to be supplied? I mean, you already have these cattle and you were undertaking to pay for them at that price. What other cattle were you expecting to be delivered under the other contract that you say you wanted? |
| A. | Well your Honour, I asked for the heavy cattle which I through experience, I know unless the cattle were missed or they weren’t there or they weren’t going to deliver them. But I had losses because of the heavy cattle. My - the losses are huge… |
| Q. | So you, as at 10th of September, you had no expectation you would get heavy cattle off them? |
| A. | The – I wanted my heavy cattle but I knew it would have to be put as a loss of income because they wouldn’t go and buy heavy cattle from a different place to – to deliver them to you. It just wouldn’t happen. And they wouldn’t take them off my place because they knew the losses – if I said – the losses to truck them to Roma and sell them… |
……
| Q. | But at the 10th of September, in your mind, you didn’t believe that they would supply you with further heavy cattle? |
| A. | I – no. I asked for it but I – I – through experience, I thought no, I don’t know where they’re going to get them from. |
| Q. | Well, why did you agree to this contract then if you knew you weren’t going to get the heavy cattle and you agreed to accept these cattle at that price? |
| A. | I can’t really explain why I’ve done it because if I didn’t have [indistinct] your Honour, I’m not sure where I’d be at the minute… |
……..
But at the time of the 10th of December – 10th of September, I – there’s more – I don’t know why I did it, because I shouldn’t have even touched it. But I – legally trying to get them shifted, it’s all too hard [indistinct] I was at.”
- [67]I find, as a matter of fact, that the defendant, in signing the agreement headed 12 August 2013 on or about 10 September 2013, knew that it was being offered on the basis it was a variation of the initial contract. The variation involved reduction of the price that he had to pay for the cattle already received in return for his accepting the lesser number of cattle. Notwithstanding the negotiating position that the defendant had taken about the weight of the cattle, I find he ultimately agreed to finalise the disagreement between the parties on the basis of the written agreement varying the original contract. In so far as his testimony is contrary to this finding I reject it.
- [68]The defendant himself conceded in cross-examination that the alternative he is contending for was uncertain and unrealistic. Once he agreed to accept, at a reduced price, the 1,219 cattle already on his property it would create uncertainty as to any obligation subsisting under the original contract. The original contract did not specify any number of “heavy cattle” and there was no agreement between the parties as to the extent, if any, of the deficiency in weight of the cattle delivered. In addition, the initial contract did not obligate a vendor to supply cattle that weren’t available following muster. At the time he executed the agreement the defendant admits he was aware it was unrealistic to expect that what he had been seeking in negotiations could be delivered. Nevertheless, he executed the agreement in circumstances where he would have fully understood that the other party expected it to finalise matters. I find he chose to forgo his entitlement to delivery of the full number and weight ranges of cattle originally contracted for in return for the consideration offered by the vendor of a reduction in the price per head of the cattle and more time to make payment by instalment.
- [69]There is a further matter which is not pertinent to the issues I have to resolve. The defendant denies that the price shown for the cattle in the document of 12 August 2013 is what he agreed to. That is not disputed by the plaintiff on the basis that it appears there was an undertaking by Landmark, Charleville to recompense the defendant for any difference between the offer that he had originally made of $297 for the steers and $240 for the heifers per head, and the price for the stock shown on the 12 August written agreement. Accordingly the plaintiff only sues for a debt based on the lesser price.
Parties to 12 August agreement
- [70]It is submitted on behalf of the defendant that the agreement of 12 August 2013 was not a contract between Deracroft Pty Ltd and the defendant and, therefore, could not be a variation of the initial contract as the parties were different. In making this submission the defendant relies upon a reference in the plaintiff’s amended statement of claim stating that the plaintiff (rather than the vendor) entered into the later agreement with the defendant. The meaning of this initially confusing statement is clarified upon perusal of the written contract and the evidence. The written contract states that it is a contract between “Deracroft Pty Ltd (Des Sipos)” and “Warana Pastoral Company (Andrew Edwards)”. The agent is shown as “Josh Phelps/Tom Brodie of Brodie Agencies”. The document bears three signatures, one of Mr Edwards and two signatures by Mr Tom Brodie. The evidence is Mr Brodie signed once as agent and again on behalf of Deracroft Pty Ltd as an authorised person. The printed form states:
“Signed by/for and on behalf of each Entity by a duly authorise person, having read and agreed to be bound by the terms and conditions of this contract.”
Mr Brodie gave evidence that he was given authority by Mr Sipos to sign on behalf of the vendor. He then signed as the duly authorised person. The standard terms on the contract form state as follows:
“Each signatory to this agreement warrants that the party on whose behalf this agreement has been signed has given full and absolute authority to that signatory. Each signatory further acknowledges personal liability to each other party in the event that such authority is denied so as to cause a loss to any other party.”
- [71]I find that the agreement entered into on or about 10 September 2013 was between Deracroft Pty Ltd as the vendor and Mr Edwards as the purchaser. The fact that arrangements were in place to ensure that the defendant need not pay more than he originally offered and for the agent to compensate the vendor for that shortfall did not affect who the parties to the contract truly were.
Whether misleading or deceptive conduct
- [72]The defendant pleaded contraventions of ss 18 and 20 of the Australian Consumer Law. The following misleading or deceptive conduct was pleaded:
“The representations were misleading or deceptive or likely to mislead and deceive because the steers and heifers that were delivered were not in accordance with the implied conditions of the first contract.”[21]
- [73]I have already found as a matter of fact that there was no implied condition as to the average weight of the cattle. I found there was an implied condition that the cattle for sale fell within the weight ranges specified, but the defendant has not led evidence establishing that the cattle supplied did fall outside the specified weight range. Accordingly, the defendant has not proved that representation was misleading.
- [74]The advertisement in respect of the steers did state that they “looked to average about 310 kg curfewed”. That statement was an expression of opinion and not an implied condition of the contract. An expression of opinion may carry with it an implied representation. In the circumstances of this case there was a representation that the person expressing the opinion actually held it and that it was reasonably based. I accept the evidence of Mr Phelps that he formed the opinion on the basis of an assessment of the cattle in situ on the property and that it was an opinion he genuinely held. His assessment was supported by Mr Peters. Accordingly, I do not find any misleading or deceptive conduct within the meaning of s 18 of the Australian Consumer Law.
- [75]The allegation of unconscionable conduct in breach of s 20 of the Australian Consumer Law is pleaded as arising from the alleged misleading and deceptive conduct, breach of contract and refusal to accept the return of the cattle. I have already found against the defendant in respect of the first two of those heads. In my assessment of the testimony of Mr Peters and Mr Edwards I accepted that no request for return of the cattle had been communicated to Mr Phelps or the vendor. I find that the allegation of unconscionable conduct has not been proven.
The assignment agreement
- [76]In his final written submission, the defendant submitted that as the assignment agreement relied upon by the plaintiff refers only to the contract of 6 July 2013, it can have no effect in respect of any subsequent variation of that contract. The defendant submits that the plaintiff cannot therefore sue on the alleged variations.
- [77]The undated assignment agreement was proved in evidence. From its terms it must have been executed between 12 December 2013 and 12 March 2014. It sets out the details of the contract dated 6 July 2013, described as the “Sale Contract”. The assignment agreement states:
“The Vendor hereby assigns all rights, title and interest in the Sale Contract to the Agent and the Agent hereby agrees to accept the assignment of the rights, title and interest in the Sale Contract.”
- [78]The agreement was signed by the directors of Deracroft Pty Ltd (the vendor).
- [79]It is clear that the intention of the vendor was to assign all entitlement arising under the original contract to Brodie Agencies Pty Ltd. By implication that extended to any variation of the original contract. I find that the assignment agreement was effective in assigning to the plaintiff all rights, title and interest in the 6 July 2013 contract, as varied. As already determined, the agreement dated 12 August 2013 varied the original contract of 6 July 2013 as to quantity and price. I find that the vendor assigned to the plaintiff its interest in the contract as varied by the 12 August agreement.
- [80]Furthermore, I accept the plaintiff’s submission that the defendant failed to deny the plaintiff’s pleading that the vendor assigned to the plaintiff all rights, entitlements and interest arising out of the “first sale contract, as varied”. The defendant is therefore deemed to have admitted the plaintiff’s pleading.
Conclusion
- [81]The plaintiff has been successful in proving the parties agreed to a compromise of the original contract dated 6 July 2013 by entering into the agreement dated 12 August 2013 to vary the number and price of the cattle sold. The plaintiff is entitled to judgment for the debt due and owing in the sum of $329,157 being monies payable under the contract as varied.
- [82]I have found that the contract as varied incorporated the Australian Livestock & Property Agents standard form terms. The plaintiff relies upon those terms in seeking indemnity costs, default interest and declaration of title in the relevant livestock. The defendant submits that indemnity costs should not be awarded as the standard terms do not support the plaintiff’s submission in that regard.[22]It will be necessary to hear argument on that issue.
- [83]The standard terms provide that property in the livestock does not pass until the price is paid in full. If that clause applies here then the plaintiff is entitled to take possession of the livestock. Of course, any proceeds of the seizure of the livestock, less costs, should be offset against the debt owing and the orders may need to reflect that. I will hear argument from the parties as to the appropriate form of the orders to be made.
Orders
- [84]The orders of the court will be:
- There will be judgment for the plaintiff.
- I will hear the parties as to costs and any further orders that may be appropriate.
Footnotes
[1] Defence, paragraph 13; statement of claim, paragraph 13.
[2] T i-46 ll 5-8.
[3] Exhibit 2
[4] Notice to admit facts, affidavit of Robert James Grealy annexure RG1.
[5] T 1-23 ll29 - 35
[6] Affidavit 24 July 2015, para 30
[7] T1-43 ll 13-15.
[8] T1-43 l 23.
[9] T1-44 ll 45-50.
[10] T1-53 lines 30-35.
[11] T1-42 li=l 10-15.
[12] T1-42.
[13] T1-54 ll 15-25.
[14] T1-55 ll 24-26
[15] T1-70 ll 7-12
[16] Exhibit 4.
[17] T 1 -59 l 40
[18] T 1 -68 ll 30 - 38
[19] T1-42 ll 39 -40, per J Phelps
[20] T1-53 ll 14-18.
[21] Para 17(b) Amended Defence and Counterclaim.
[22] Defendant’s Submission, para [48]. The defendant submits that clause 18.2 of the standard terms only applies to a claim for actions taken under the clause.