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Murphy Farming Pty Ltd v Gralike[2016] QDC 126

Murphy Farming Pty Ltd v Gralike[2016] QDC 126

DISTRICT COURT OF QUEENSLAND

CITATION:

Murphy Farming Pty Ltd as Trustee for the Murphy Farming Trust v Gralike & Ors [2016] QDC 126

PARTIES:

MURPHY FARMING PTY LTD (ACN 072 818 056) AS TRUSTEE FOR THE MURPHY FARMING TRUST

(Plaintiff)

v

JEREMY SHAUN GRALIKE

(First Defendant)

&

STANLEY ALEXANDER GRALIKE

(Second Defendant)

&

SUE BARBARA GRALIKE

(Third Defendant)

&

JCJ LAWYERS PTY LTD (ACN 169 633 112) TRADING AS JEFFERY CUDDIHY & JOYCE SOLICITORS

(First Non-Party)

&

BRENDAN MICHAEL CUDDIHY TRADING AS JEFFERY CUDDIHY & JOYCE SOLICITORS

(Second Non-Party)

&

BRENDAN MICHAEL CUDDIHY

(Third Non-Party)

&

CHRISTOPHER DAVID ANDERSON

(Fourth Non-Party)

FILE NO/S:

D111/08

DIVISION:

Civil

PROCEEDING:

Trial

DELIVERED ON:

1 June 2016

DELIVERED AT:

Maroochydore

HEARING DATE:

23, 24 and 25 May 2016

JUDGE:

Bowskill QC DCJ

ORDERS:

1.There will be judgment for the plaintiff against the second and third defendants, for the sum of $130,030, plus interest (to be calculated).

2.The plaintiff’s claim against the first defendant is dismissed.

3.The plaintiff is directed to provide a draft order, showing the amount of interest claimed, and the basis for the calculation.

4.I will hear the parties as to costs, including any application against the “non-parties” for costs.

CATCHWORDS:

CONTRACTS – claim for recovery of money paid under agreements for the purchase of goods – factual dispute as to which of the defendants was the owner of the goods – whether the agreements frustrated as a result of part of the goods being stolen and therefore incapable of delivery – whether there has been a total failure of consideration – whether the sellers liable to repay the plaintiff.

COUNSEL:

JE FitzGerald for the Plaintiff

J Gralike, on his own behalf, as the First Defendant

No appearance for the Second and Third Defendants

SOLICITORS:

Mills Oakley for the Plaintiff

  1. [1]
    Paul and Cherry Murphy, as directors of Murphy Farming Pty Ltd, carry on a farming business on a property known as Kevricia, in Capella. In late 2007, they agreed with Stanley and Sue Gralike to purchase a large industrial shed, which had a 4 bedroom residence built inside part of it, a solar power system and a solar hot water system, all of which were located on a property at Tuchekoi owned by Jeremy Gralike, who is Stanley and Sue’s son. The Murphys ultimately paid the whole of the agreed price of these items, but they did not receive what they had bargained for. They received some parts of the shed, but were not able to take delivery of a considerable part of it (including the internal house fixtures and fittings), the solar power system, or the hot water system, because they were allegedly stolen from the Tuchekoi property before they could do so. By these proceedings, they seek to recover the money they paid, from all or some of the defendants.
  1. [2]
    One of the primary issues is, to whom did the shed, solar power system and hot water system belong, and therefore who was the contracting party, as seller of these goods, to Murphy Farming?  Were they owned by Stanley and Sue Gralike?  Or were they owned by Jeremy Gralike?  
  1. [3]
    Stanley and Sue Gralike did not appear at the trial. Their former solicitors, Mr Cuddihy and Mr Anderson, of Jeffery Cuddihy & Joyce solicitors, lost contact with them in late 2014. Although that firm continued to remain on the record, despite the fact that they could not contact their clients or take instructions from them, they were given leave to withdraw from the record on the first day of the trial. Sue and Stanley Gralike’s son, Jeremy Gralike, did appear at trial, representing himself. He has been estranged from his parents since 2009; although they once had a close relationship.
  1. [4]
    The only witness the court heard from in person was Jeremy Gralike, who was required for cross-examination by the plaintiff. Jeremy Gralike’s evidence in chief is otherwise contained in two affidavits made by him, and a statement by him which had been filed in separate Supreme Court proceedings brought against him by his parents. Otherwise, all the evidence relied upon by the plaintiff was in affidavit form, consistent with directions earlier made by the court on 4 December 2015, with none of those remaining witnesses being required for cross-examination. Although this made for an efficient and speedy trial, it meant the court did not hear anything directly from, for example, Paul and Cherry Murphy. Nonetheless, their written evidence has been accepted as truthful.
  1. [5]
    In so far as Jeremy Gralike’s evidence is concerned, there are aspects of the arrangements he had with his parents that are questionable; and the full extent of his denials of knowledge about certain things is at times difficult to accept. However, whereas his parents have disappeared and failed to face the court to address the allegations made against them, Jeremy Gralike has continued to consistently defend the action against him, and appeared on his own behalf at the trial. It is difficult to know exactly where the truth lies about some of the matters addressed in the evidence at the trial, concerning the Gralikes’ affairs. At the end of the day, though, I am concerned about where the balance of probability lies, on the basis of an objective analysis of the evidence at trial. For reasons which I explain below, I do not consider that, on the basis of such analysis, there is any reason not to accept his evidence about the particular matter central to the plaintiff’s case, namely, ownership of the goods.

The Murphys’ evidence about their agreement with the Gralikes

  1. [6]
    In November 2007, Paul Murphy responded to an advertisement in Queensland Country Life for the sale of a stand alone solar power system, which put him in contact with Stanley Gralike. During their initial discussion, Stanley Gralike told Paul Murphy, among other things, that the solar power system powered a shed which had a house integrated into it. At that stage, however, Stanley told Paul that the shed had been sold to someone else.
  1. [7]
    A few days after this conversation, Stanley’s wife, Sue Gralike, emailed some photographs to Paul Murphy of the solar power system, and the shed (including its interior). There was also a solar powered hot water system being offered for sale. A few more telephone conversations took place between Paul Murphy and Stanley Gralike, about the solar power system, and how it could be removed, transported and reinstalled, if the Murphys were to purchase it.
  1. [8]
    Paul and Cherry Murphy decided they would go and inspect the solar power system and the hot water system. They also decided that, if the sale of the shed fell through, they would purchase that as well.
  1. [9]
    An exchange of emails between Sue Gralike and the Murphys on 14 November 2007 reveals that:
  1. (a)
    Sue Gralike advised that the full cost of the solar power system was $55,000, which “will need to be paid in full & cleared prior to system being removed”. A deposit of $1,000 was required. Details of a Commonwealth Bank account (Noosa Heads branch, BSB 064449, account number 10287300) were provided, for payment (this will be referred to as the Noosa CBA account). The email also said:

“[t]he account is in the name of:  J.S. Gralike all transactions will be in that name.”

The email gave “contact details” as Stan & Sue Gralike, PO Box 452, Eumundi.

  1. (b)
    The Murphys responded to say they would like a contract and invoice “so that we can avoid any potential problems with the purchase”, and asked Sue to let them know if the sale of the shed is not completed “and we’ll add that to the list”.
  1. (c)
    Sue Gralike responded, among other things, by asking the Murphys to please put the deposit into the account for the stand alone solar power system “and you will be on the top of the waiting list if the shed sale falls through”.
  1. [10]
    The sale of the shed did fall through, and it was then offered to the Murphys for $60,000. In an email from Sue Gralike to the Murphys of 21 November 2007, she asked them to advise within 24 hours if they would like to purchase the shed, and requested a $5,000 deposit, “non-refundable”, “just to show a genuine purchase”.
  1. [11]
    Paul Murphy responded, on the same day, to say that they would take up the offer of “the complete shed to go with the stand alone solar system”. Arrangements were also made for the Murphys to visit and inspect the shed and the solar power system. The Murphys paid the $5,000 deposit on 22 November 2007.
  1. [12]
    The Murphys went to the property as directed by Stan and Sue Gralike, being the Tuchekoi property, on 24 November 2007. They met with Stan and Sue Gralike, and saw no one else at the property on that day.
  1. [13]
    Stan and Sue Gralike showed the Murphys around the property, and the shed, and Paul Murphy also went onto the roof of the shed to inspect the solar power system.
  1. [14]
    On this day, Sue Gralike presented three documents for the Murphys to sign:
  1. (a)
    a document headed “contract for sale of industrial shed”:
  1. (i)
    with a printed “date of contract” of 22 November 2007;
  2. (ii)
    naming the seller as Mr Jeremy Gralike, PO Box 452, Eumundi, Qld 4562;
  3. (iii)
    naming the buyer as “Murphyfarming”, Paul & Cherry Murphy;
  4. (iv)
    listing the “details” of the shed, including reference to the “4 bedroom house”;
  5. (v)
    referring to the cost as $60,000, noting the non-refundable deposit of $5,000, and the balance outstanding as $55,000; and
  6. (vi)
    next to “conditions”, providing “Buyer to arrange removal (owner can arrange, for a fee)”;
  1. (b)
    a document headed “contract for sale of solar power system”:
  1. (i)
    with the same printed date of contract, seller and buyer;
  2. (ii)
    listing the “details”, by referring to “Solar Power System, stand alone”, and other components;
  3. (iii)
    referring to the cost as $55,000, noting the non-refundable deposit of $1,000, and the balance outstanding as $54,000;
  4. (iv)
    next to “conditions”, providing “Buyer to arrange removal (owner can arrange, for a fee)”; and
  1. (c)
    a document headed “contract for sale of solarhart hot water system”:
  1. (i)
    with the same printed date of contract, seller and buyer;
  2. (ii)
    listing the “details”, as including a Bosch Hi-flow gas back up system;
  3. (iii)
    referring to the cost as $2,500; and
  4. (iv)
    next to “conditions”, providing “Buyer to arrange removal (owner can arrange, for a fee)”.
  1. [15]
    Cherry Murphy says that when these three documents (two copies of each) were presented to her, by Sue Gralike, in the kitchen of the house inside the shed, they already bore the signature of “J Gralike” above the name Jeremy Gralike, and the handwritten date 23/11/07.
  1. [16]
    Cherry Murphy also says that, at this time, Sue Gralike said to her that “Paul and I were not permitted to take any items from the Gralike Property until we had paid for them in full” and “she required Paul and I to sign the Sale Contracts to prove that we were legitimate purchasers”.
  1. [17]
    The three documents were signed by Cherry Murphy on 24 November 2007. Paul Murphy signed two of them, but overlooked signing the third.
  1. [18]
    The evidence of the Murphys is that on 24 November 2007 they also reached an oral agreement with Stan Gralike that, in consideration for the payment of an additional $10,000, Stan Gralike would dismantle and pack the shed, the solar power system and the hot water system onto a truck to be supplied by the Murphys. They also negotiated an option for Stan Gralike to come to Kevricia to assist with re-assembling the whole construction, should that be necessary.
  1. [19]
    Paul Murphy said in his evidence that the three documents “did not exactly spell out the deal that had been reached”, but that Stan Gralike and he “had a clear agreement and understanding that Murphy Farming Pty Ltd would purchase the construction as the whole unit packed and loaded onto transport and Stan Gralike would assist me to re-assemble the unit at Kevricia if I needed his help in this regard”.
  1. [20]
    Following 24 November 2007, there appears to have been a further exchange(s) between Paul Murphy and Stan Gralike, about keeping electrical items, such as the hot water system, out of the rain, as the shed was dismantled. Paul Murphy says he was told by Stan Gralike on 29 November 2007 that he had obtained a shipping container for this purpose. Although Paul Murphy says he did not direct Stan Gralike to do this, or agree to pay for it, it seems that in fact the Murphys did pay an additional $2,530 to Stanley and Sue Gralike for the shipping container.
  1. [21]
    The Murphys started to make payments under the agreements in December 2007, by various instalments, the amounts of which (maximum of $15,000 at a time) were dictated by restrictions placed on electronic funds transfers by the Murphys’ bank. By 28 December 2007 they had paid $55,000.
  1. [22]
    Paul Murphy went to the Tuchekoi property on 28 December 2007 in a large truck for the purpose of collecting the various items agreed to be purchased. Stan and Sue Gralike were there, as well as Jeremy Gralike, and a person named Nathan (said to be Jeremy’s brother in law). The shed had already been dismantled, and there were piles of shed frame, and piles of other components of the shed (such as doors and windows, kitchen benches and cupboards, bathroom, laundry and kitchen fittings, and internal stairs) covering the site where the shed had previously stood.
  1. [23]
    One of the items, the wind generator tower, had not yet been dismantled, and was still attached to its concrete foundations.
  1. [24]
    Paul Murphy said that some pieces of the shed had been bent, and were unusable, and that the Gralikes (in context, I infer, Sue and Stan Gralike) agreed to replace those damaged items.
  1. [25]
    Paul Murphy says he did not see a number of the items at all, including the solar power system panels, inverter, controllers and tracking system, the hot water system, and various other things. He was shown the red shipping container, which was already tightly packed with, among other things, insulation batts; although it was not ready to transport. I infer from Paul Murphy’s evidence that he was not able to see what was packed into the shipping container, but that the contents included the solar power system and the hot water system.
  1. [26]
    Jeremy Gralike agreed that he had assisted his father to dismantle the shed, in order to load it onto the Murphys’ truck. He says he was paid by his father to do this, an amount of $1,500.[1]He referred to an amount being debited to the Noosa CBA account on 2 January 2008 for this amount, with the notation “Jeremy shed work”, as being this payment.[2]
  1. [27]
    Only part of the various items were able to be loaded onto the truck. Paul Murphy says that the following items were unable to be loaded:
  1. (a)
    a large amount of the shed frame;
  2. (b)
    all of the internal walls, flooring and windows of the shed;
  3. (c)
    all plumbing and electrical wiring;
  4. (d)
    all fixtures and appliances;
  5. (e)
    the red shipping container and its entire contents, including the solar power system and the hot water system;
  6. (f)
    the wind generator tower; and
  7. (g)
    the controller and charger for the wind generator (the remaining goods).
  1. [28]
    Paul Murphy says that before he drove off, and whilst he was standing with Sue and Stan Gralike, and Jeremy Gralike, Sue said to him that he could not take the remaining goods until they were paid for in full. Jeremy Gralike said he had no conversation with Paul Murphy on this day, other than saying hello. Paul Murphy’s evidence is that, shortly after arriving at the property, Jeremy Gralike, and Nathan, told him they had assisted Stan to dismantle the shed, and had planned the order in which the goods would be loaded onto the truck. I accept Paul Murphy’s evidence, as it seems unlikely that no conversation, other than “hello” would have taken place. However, I note that the one conversation, concerning the terms of the agreement – regarding payment – took place with Sue Gralike, albeit in the presence of Jeremy Gralike, and there is no suggestion that Jeremy Gralike had anything to say at that point.
  1. [29]
    Paul Murphy does not expressly describe what items he did collect on 28 December 2007, but on the basis of what he says they were “unable to load” (ie the remaining goods), it appears he only collected part of the shed frame. What is clear is that he was not able to take the solar power system (at all), the hot water system (at all), and a significant part of the shed, in particular, the internal fittings from the house inside the shed.
  1. [30]
    There was a delay in taking delivery of the remaining goods, due to flooding around Emerald in early January 2008, which resulted in road closures in and out of Capella, and the Murphys’ property, Kevricia. Even after the floodwaters subsided, there were weight restrictions placed on trucks travelling on these roads.
  1. [31]
    During the period from January to March 2008, there were discussions between the Murphys and Stan and Sue Gralike, about when the Murphys could collect the remaining goods, how that would occur, and when payment of the remaining balance would be made. As to the latter, although the agreement had been that final payment would not be made until all the goods were packed and loaded onto the truck for transport, the Murphys did eventually agree – after being considerably pressed by Stan and Sue Gralike – to pay the remaining balance prior to that occurring, given the delays that were taking place with delivery.
  1. [32]
    By 19 February 2008 the Murphys had paid the whole of the amount agreed to the Gralikes. As Cherry Murphy said in her affidavit, they made a decision to trust the Gralikes and pay the remaining balance, even though they had not received all of the goods.
  1. [33]
    All payments were made, by electronic direct deposit, into the Noosa CBA account, in the name J Gralike, at the request of Stan and Sue Gralike. In total the Murphys paid $130,030.00 into that account, comprising:
  1. (a)
    $60,000 for the shed;
  2. (b)
    $55,000 for the solar power system;
  3. (c)
    $2,500 for the solar hot water system;
  4. (d)
    $10,000 for the dismantling, packing and loading of the items onto the truck, as agreed with Stan Gralike; and
  5. (e)
    $2,530, being the cost of the shipping container.
  1. [34]
    Plans were made for a truck driver from a company called Greaneys to go to the property on 4 March 2008 to collect the remaining goods. However, on that day, when the receptionist from Greaneys called Stan Gralike to let him know the driver would be coming, he told her there was no point as all the remaining goods had been stolen. The receptionist then telephoned Paul Murphy to tell him this also.
  1. [35]
    Paul and Cherry Murphy each made attempts to speak to Sue and/or Stan Gralike to find out what had happened. Cherry Murphy did eventually speak to Stan on 4 March 2008. She recalls Stan saying that all of the remaining goods which were in the shipping container had been stolen; that they would pay the Murphys back the monies paid for the goods; and that the trackers for the solar panels, and wall panels of the shed were not stolen, and were still available for delivery if the Murphys wanted them.[3]Cherry Murphy followed this up with an email to Stan, confirming that he had told her they would reimburse the Murphys in respect of the missing goods.
  1. [36]
    It appears, from police records, that Stanley Gralike reported the alleged theft from the Tuchekoi property on 21 February 2008.[4]Exactly what was said to have been stolen on this day is unclear. After exhausting all enquiries, no suspects were identified. The police concluded that the offence must have been committed by someone who knew where the property was stored, as it was not in a position “to be accidentally come across” (being in a shipping container, on a large property, not visible from the street, requiring a large truck to remove it).
  1. [37]
    Cherry Murphy had another phone conversation with Stan Gralike on 8 March 2008, in which she asked him what he was proposing to do, and says that he reassured her “not to worry as they will sort us out”.[5]
  1. [38]
    On 9 March 2008, the Murphys sent a letter of demand to Stan and Sue Gralike (at PO Box 452, Eumundi), asking for the return of the money paid by the Murphys to them, given the circumstances. A further letter of demand was sent to Sue and Stan Gralike on 14 March 2008. In this letter, the Murphys also offered to return the parts of the shed, and other miscellaneous items they had already collected.
  1. [39]
    The Murphys also sent a letter of demand to Jeremy Gralike on 14 March 2008, addressed to 6 Cambuca Court, Tewantin. They explain that they found his address in the White Pages. This was Jeremy Gralike’s residential address at that time. He denied receiving the letter. However, the letter of demand to Jeremy was included in a bundle of documents which Stanley and Sue provided to Mr Anderson of Jeffery Cuddihy & Joyce.[6]It is difficult to see how they could have come to have the letter, if Jeremy Gralike never received it (it is not suggested they were living at his Tewantin house). Jeremy’s explanation (given in the context of the preliminary hearing) was that his parents could have collected it from his mailbox, saying that they did things like that quite often.[7]This aspect of Jeremy’s evidence was unconvincing.
  1. [40]
    It is at this point that the firm of solicitors, Jeffery Cuddihy & Joyce, became involved, on the instructions of Sue and Stanley Gralike. Although they purported to act for Jeremy Gralike as well, from March 2008, it was found in the course of a preliminary hearing at the commencement of the trial that Jeremy Gralike did not engage or instruct that firm. The firm erroneously acted on the basis of instructions given by Sue and Stan, on the assumption that they could speak for Jeremy, but at no time did they speak directly to Jeremy Gralike to obtain his instructions.
  1. [41]
    Subsequently, a claim was made, under a building insurance policy in the names of S, J and S Gralike as insureds. The claim was for a variety of items, totalling $115,665.54.[8]The claim was declined, on the basis that the insureds had failed to advise the insurer that they were no longer occupying the property. The letter advising of this is addressed to Sue, Stan and Jeremy Gralike, at PO Box 850, Cooroy.[9]Jeremy Gralike’s evidence is that this was his mother and father’s PO Box address.[10]He otherwise denied any knowledge of the insurance policy, or the claim.
  1. [42]
    An auction clearing sale was held, at a property at 205 Larneys Lane, Eerwah Vale (also referred to as the Eumundi property) on 31 May 2009. This property was owned by Jeremy Gralike, but Stan and Sue Gralike were living there at the time. According to the auctioneer, Thomas Grady,[11]he was contacted by Stan and Sue Gralike to organise the auction, who told him that the proceeds of the auction were to be paid to Jeremy Gralike. Thomas Grady says that was done, with the proceeds of $43,711.85 being paid by way of cheque made out to Jeremy Gralike.
  1. [43]
    The plaintiff submitted that several items sold at the auction were part of the goods Murphy Farming had contracted to purchase from Stan and Sue Gralike, and which were alleged, by Stan Gralike, to have been stolen. As to items alleged to have been stolen, save for the first item referred to below, the evidence was not clear. The relevant items sold at auction included:
  1. (a)
    A built in kitchen, described by the purchaser as closely resembling, or being identical to, the kitchen which was in the shed.[12]The list of items allegedly stolen, provided to the insurer, included “kitchen cupboards most but not all”,[13]referring to an invoice from Widebay Cabinet Makers. In an email Sue Gralike sent to the Murphys on 11 March 2008, providing a “list of items stolen”, she did not include the kitchen.[14]But in any event, having regard to the list provided to the insurer, and what was purchased at auction, it is reasonable to infer that the kitchen sold was part of the goods contracted to be sold to the Murphys, and alleged by the Gralikes to their insurer to have been stolen.
  1. (b)
    Four solar panel trackers, said by the purchaser to closely resemble, or be identical to those which had been installed on the shed.[15]It does not appear that the solar panel trackers were alleged to have been stolen,[16]and in fact when the Murphys spoke to Stan Gralike upon discovery of the theft, they were told that the solar panel trackers, as well as the wall panels for the shed, were not stolen and could be collected.[17]
  1. (c)
    A Solahart solar water heater, and four solar panels, having the same serial numbers as those contracted to be sold to the Murphys, were also sold at the auction.[18]As far as I can tell, these items were not listed as being allegedly stolen (although the Bosch gas hot water system was).
  1. (d)
    The evidence also referred to the sale at auction of a house frame.[19]It is not apparent whether this was the same as the frame inside the shed purchased by the Murphys, although Jeremy Gralike accepted in cross-examination that it was.[20]There is no house frame included in the list of items allegedly stolen.[21]
  1. (e)
    A red shipping container, with the same serial number as the one obtained by Stan Gralike to store the electrical items pending delivery to the Murphys, was also sold at the auction. Again, it does not appear to have been alleged that the shipping container itself had been stolen.[22]
  1. [44]
    A series of handwritten tax invoices were prepared by Norma Grady, following the auction, which listed all of the various items sold. The tax invoices were addressed to J S Gralike, PO Box 452, Eumundi (Sue Gralike’s PO Box address).[23]Jeremy Gralike denied seeing this document, other than in the course of these proceedings.  Neither Thomas Grady, nor Norma Grady, say anything in their affidavits about this document being given to Jeremy Gralike.
  1. [45]
    Jeremy Gralike’s evidence[24]was that he held a farm auction on this day to sell farming equipment and machinery (including tools, pumps, a slasher and tractor, a cattle crush, fence wiring and other items), as he intended to close his business at the end of the financial year. He says that he did not at any time see any of the items from the shed sale that his parents had at the auction. He says “they had their own items they were looking after and I had mine”.[25]
  1. [46]
    Upon seeing the tax invoice, Jeremy Gralike confirmed that it included items he had sold, as well as items he had not, suggesting that the document is a combination of everything sold on that day, by both himself and his parents. But he confirmed that he received about $40,000 from the auction, which was paid into his “business account” (in his oral evidence, he said this was his Bendigo Bank account). Jeremy Gralike said that he thought all of the money he received was for the items he had sold. But on the evidence now before the court, it is apparent that the money he received was all the proceeds from the auction, including the items he says he had no knowledge about.
  1. [47]
    As noted at the outset, one of the central issues for determination is who owned the shed and its inbuilt residence, the solar power system and the solar hot water system, and therefore who was the party that contracted with the Murphys as the seller of those things; for it is that party which is, if the legal case is made out, responsible to make good the loss suffered by Murphy Farming. In determining that issue, it is relevant to have regard to the evidence of Jeremy Gralike about his relationship with his parents, including as to various property dealings, prior to November 2007, because that informs, and explains, his evidence regarding ownership of the shed and the other items.

Jeremy Gralikes’ evidence[26]

  1. [48]
    Jeremy Gralike says that, prior to 2003, Stanley and Sue owned two properties, one at Ferguson Road, Pomona; and another at 6 Ranson Court, Pomona (which they owned with Jeremy’s grandparents). He used to live with them at the Ferguson Road property, and carried out farming and maintenance work on both properties. He says that both Stanley and Sue are (or at least were, since he says he has not spoken to them since 2009) in receipt of disability support pensions. In so far as Stanley is concerned, that had been the case since he had a tractor accident in 1999.
  1. [49]
    In November 2003, Jeremy Gralike bought the Tuchekoi property (Lot 19 on Kenilworth Skyring Creek Road, Tuchekoi). The purchase price was $285,000. He says he paid a $5,000 deposit (from the sale proceeds of his motorbike) and borrowed the remaining $280,000, secured by a mortgage to the Commonwealth Bank. At the same time, he took out a personal loan to buy a small tractor and a slasher. Although Jeremy Gralike says he was unaware of this, apparently his parents had given additional security on this loan, by a mortgage over their property. He says he thought they had only given a personal guarantee.
  1. [50]
    Jeremy Gralike says that when he bought the property, he was working at the PGH brickworks at Cooroy, but he was hoping to establish a cattle business on the Tuchekoi property which, if successful, he would work at full time. He says that he started working at the PGH brickworks when he was 17, and by 2003 had been working for them for approximately 3 years; from which I infer that he was about 20 when he purchased the Tuchekoi property.
  1. [51]
    Sometime in late 2003, and early 2004, both the Ferguson Road and Ranson Court properties were sold. Stanley and Sue paid part of the sale proceeds of the Ferguson Road property, an amount of $147,500, towards Jeremy’s mortgage on the Tuchekoi property. Jeremy says this was without discussion with him, but that they subsequently agreed he would repay that amount to them, if the Tuchekoi property was ever sold.
  1. [52]
    After the Ferguson Road property was sold, it appears there were discussions about Stanley and Sue wanting to finish off work on their motorhome so that they could go travelling. Stanley and Sue said they needed a shed in which to store their motor home, and asked if they could build one on the Tuchekoi property, for that purpose, and which could also be used as a residence. Jeremy says he agreed that they could.
  1. [53]
    According to Jeremy, Stan and Sue co-ordinated the purchase of the materials for the building of the shed. Jeremy assisted with laying the concrete slab, and also built the residence inside the shed. Otherwise, Jeremy says he had “virtually no involvement in the purchase of materials and erection of the shed”. He says he was working 6 days a week at that time, and any spare time he had, he spent attending to the cattle and maintaining the Tuchekoi property.
  1. [54]
    Jeremy Gralike says that his parents told him they needed him to sign the necessary paperwork for the purchase of the shed “so their pensions were not affected”. He says that he was not consulted as to the cost of the shed being erected; that Stanley and Sue organised this, as he was working full time. Jeremy says that Stanley and Sue utilised their own funds to purchase the materials for the shed.
  1. [55]
    In about February 2004, Stanley, Sue and Jeremy all relocated to the Tuchekoi property, and lived there, in the residence within the shed.
  1. [56]
    In November 2005, Stanley and Sue sold their motorhome. They deposited $60,000 of the proceeds towards the mortgage on the Tuchekoi property. Again, Jeremy says, they did so without his knowledge. But again, he agreed to repay the money should the Tuchekoi property be sold.
  1. [57]
    In April 2007, Jeremy Gralike sold the Tuchekoi property to Queensland Water Infrastructure (in the context of resumption for the construction of the proposed Traveston Crossing Dam) for $1,975,000, representing a very considerable profit. Jeremy says that the shed and associated facilities were expressly excluded from the contract of sale to QWI.
  1. [58]
    In May 2007, Jeremy Gralike says that he opened a cash investment account with the Commonwealth Bank at Noosa. He says that he opened the account in his name, at the request of Sue Gralike, and that the funds that were to go into this account, were the funds that Stanley and Sue were owed from their contributions to the Tuchekoi property. Jeremy Gralike says that:

“Stanley and Sue told me they wanted the account to be opened in my name so their disability pensions would not be affected. I was not entirely comfortable with this, but agreed. Despite the account being in my name, the money to be deposited into that account was to be money to which Stanley and Sue were beneficially entitled. They were to be able to operate that account”.

  1. [59]
    This account is the Noosa CBA account (that is, the same account that Sue and Stanley Gralike told the Murphys to pay the deposits and balance of the purchase price into).
  1. [60]
    Jeremy Gralike’s evidence is that the Noosa CBA account is not “owned by” him, but is held in his name as trustee for Stan and Sue, and that Stan and Sue are beneficially entitled to that bank account.[27]As support for that, he referred to the payment of $1,500 to him by his father, for his help in dismantling the shed. He also referred to another occasion when he borrowed money from his parents to buy a gearbox for his car, which came out of the CBA account, and then he repaid it back into the CBA account, although did not identify that on the bank statements which are in evidence.[28]
  1. [61]
    Jeremy says that he paid about $493,000 into this account, the majority of that coming from the sale proceeds, which he said “more than covered the money that Stanley and Sue had contributed to the Tuchekoi property”.
  1. [62]
    As already noted, Jeremy’s evidence is that he had another bank account, with Bendigo Bank, which was his “business account”. At one stage, in about mid 2006, he says that he arranged for Sue Gralike to be a signatory on this bank account, because he was working in Brisbane, and wanted her to be able to pay suppliers if necessary.[29]
  1. [63]
    After the sale of the Tuchekoi property, in early 2007, Jeremy bought a residential property at 6 Cambuca Court, Tewantin and, in May 2007, he purchased the property at 205 Larneys Lane, Eerwah Vale. He continued to lease the Tuchekoi property for a period of time, as the fencing at the Eerwah Vale property was not suitable to keep cattle there. He says he agreed that Stanley and Sue could reside on the Eerwah Vale property.
  1. [64]
    There was a capital gains tax liability arising from the sale of the Tuchekoi property of $140,000. It became due for payment in about January or February 2008.[30]At least part of that debt was paid out of the Noosa CBA account.[31]Jeremy Gralike referred to having an agreement with Sue, that she would pay part of the tax debt out of money in the Noosa CBA account.[32]But Jeremy’s evidence also is that in December 2009 he sold the Tewantin property, and used part of the sale proceeds to pay the debt. In his submissions, Jeremy Gralike speculated that his parents had paid some of the tax debt, because he had repaid them more than they had contributed to his mortgage,[33]but there was no evidence given by him about that.
  1. [65]
    In mid to late 2009, Jeremy says he received an offer to purchase the Eerwah Vale property from Powerlink. However, his parents refused to vacate the property, and the sale fell through. This seems to have been the catalyst for the relationship between Jeremy and Stanley and Sue deteriorating.
  1. [66]
    Sometime in mid to late 2009, Jeremy says he noticed amounts were being removed from his Bendigo Bank business account by his mother, Sue, and as a result he cancelled her authority to operate that account. He never did anything about the Noosa CBA account, because on his evidence that account was for Stanley and Sue’s benefit.
  1. [67]
    Consistent with the deterioration in their relationship, Stanley and Sue Gralike issued proceedings against Jeremy in the Supreme Court in 2010, which were said to involve a dispute about what interest they had in the Eerwah Vale property.[34]It is not entirely clear what happened in those proceedings, although Mr Anderson said that, in about October 2014, he was informed by the solicitor for Jeremy Gralike that Stanley and Sue had been “removed from their home at Eerwah Vale”, “due to their non-responsiveness in relation to the Supreme Court matter”,[35]and after that he lost contact with them.

Who was the owner of the goods?

  1. [68]
    The plaintiff originally commenced this proceeding only against Jeremy Gralike, on the basis that he was the owner of the various items, and that Stanley and Sue contracted to sell them to the Murphys, as his agent. Stanley and Sue Gralike were joined as defendants to this proceeding in July 2013, it being pleaded, in the alternative, that they were the owners of the various items.
  1. [69]
    In their defence filed on 17 January 2014 (to an earlier version of the statement of claim) Stanley and Sue Gralike plead that Jeremy Gralike was the “legal owner” of each of the shed, solar power system and hot water system, but that they were the “beneficial owners” of those things. The basis of that distinction in the pleading is not apparent. In the plaintiff’s reply to that pleading, filed on 4 February 2014, a request, from the plaintiff, for particulars of the allegation, which “remains unsatisfied”, is alluded to. There is nothing on the court file which suggests any such particulars were ever given, and no reference was made to this by the plaintiff at the trial. In the absence of any appearance by Stanley or Sue Gralike at the trial, and therefore any evidence from them, no weight is given to their pleading in this regard.
  1. [70]
    The plaintiff relies on the following evidence, to support its case that Jeremy Gralike was the owner.
  1. [71]
    First, the plaintiff relies on evidence from Neil Luckett, a private certifier who had issued a decision notice approving the proposed works for the construction of the shed in January 2004.[36]Under the heading “ownership details”, the name J Gralike appears, with an address “C/- PO Box 758 GYMPIE”, and a notation “issued to” “Mecano Sheds Gympie”.  Jeremy Gralike said he did not recognise the PO Box, and said he assumed it might belong to Mecano Sheds.[37]In context, that is a rational assumption, since the document was being issued to that business.
  1. [72]
    I do not regard this document as supporting a conclusion that the shed was “owned by” Jeremy Gralike. The reference to “owner” on this form is consistent with Jeremy Gralike being the owner of the property on which the shed was proposed to be constructed, which he was.
  1. [73]
    The plaintiff next relies on various documentation, evidencing the purchase of some of the items subject of the agreement with Murphy Farming, being in the name of Jeremy Gralike. These included a tax invoice dated 3 January 2004 from Noosa Gas Appliance Centre, for a Bosch gas hot water system;[38]and a tax invoice for the supply of kitchen cupboards and a bathroom vanity.[39]
  1. [74]
    Those invoices are amongst a number of invoices/receipts which were seemingly provided to the insurer in support of the insurance claim. Other such documents are in the name of Sue and/or Stan Gralike (for example, the dishwasher, the carpet, the windows and flyscreens, the kitchen appliances, bathroom fittings, lights).
  1. [75]
    Jeremy Gralike denied that he had purchased either the Bosch hot water system, or the kitchen cupboards. In the light of his overall evidence, including as to his parents’ role in deciding to, and then actually, constructing the shed (including being responsible for paying for the materials and equipment), and their arrangement to use his name for some of their transactions, I do not regard the existence of invoices, bearing his name, for these items, as proof that he was the owner of them; or, more relevantly, the owner of the shed (including the house) and the hot water system, contracted to be sold to Murphy Farming.
  1. [76]
    The plaintiff also relies on a tax invoice for the supply of an “off grid solar system” being in the name “J Gralike”. Ilya Sippen, who was the business owner and manager of Solar Power and Pumps in 2004, said[40]that in or about May 2004 he was contacted by Stanley Gralike, about the sale of an off the grid solar power system, under the Queensland Government Environmental Protection Agency Rebate Scheme. He sold that system to Stanley on about 26 May 2004, for $44,418. He says that Stanley requested the invoice be made out to Mr J Gralike, which it was. Mr Sippen also completed the EPA Rebate Scheme pre-approval application form, “for and on behalf of Stanley, in accordance with the invoice”, with the result that that paperwork is also in the name of Jeremy Gralike. Mr Sippen says that he received payment for the solar power system, being the balance owing after the rebate, by cheque made out and signed in the name of J Gralike, with an accompanying handwritten “remittance” bearing the name Jeremy Gralike.[41]
  1. [77]
    Mr Sippen says he went to the Tuchekoi property to install the solar power system to the roof of a house/shed, in about August/September 2004. When he got there, he says that “Stanley informed me that he owned the Farm and the Solar System was for his house, being the House/shed”. Mr Sippen says that while he was installing the solar power system, Stanley introduced him to his wife Sue Gralike. Mr Sippen also says that “[f]rom time to time during the Install, I did see Stanley and Sue’s son Jeremy Gralike… working at the Farm and was at one point introduced however, I never had any business dealings with Jeremy regarding the Solar System or the subsequent maintenance”.
  1. [78]
    In relation to the latter, Mr Sippen says that after the solar power system was installed, Stanley contacted him several times over the years to attend the farm and conduct maintenance and/or alterations to the solar power system. At all times Mr Sippen says that he “dealt in business with Stanley and Sue and did not deal in business with Jeremy”. He also says that Stanley and Sue paid for the Maintenance to the Solar System”. Finally, Mr Sippen says that at one time during maintenance, Stanley told him the government had resumed his farm and he was selling everything part by part.
  1. [79]
    Jeremy Gralike denied that he had purchased the solar power system, and said that it was his parents who had purchased it. Mr Sippen’s evidence is consistent with that.
  1. [80]
    The plaintiff also relies on a tax invoice for the purchase of a 20 ft shipping container being issued in the name of Jeremy Gralike.[42]Ian Hamblin, the manager of Gympie Childers Towing Pty Ltd, which supplied the container, annexes the invoice to his affidavit, and notes that although the invoice was addressed to 205 Larneys Lane Eumundi, the container was delivered to the Tuchekoi property. However, he does not give evidence otherwise about any recollections of who he dealt with in relation to this. Separately, he refers to dealings with Stan Gralike, in relation to the removal of a tractor and slasher from Tuchekoi to Eumundi in February 2008, and the transport of a laden 20 ft shipping container from Tuchekoi to Eumundi between April and July 2008.
  1. [81]
    Finally, the plaintiff relies on the three documents, described as “contracts for sale”, which apparently bear Jeremy Gralike’s signature, and the date 23 November 2007, which was the day before Paul and Cherry first met Stan and Sue at the property. Jeremy Gralike denies seeing the contracts (prior to these court proceedings), and denies signing them. He acknowledges that the signatures on the contracts look like his signature, but says they are not.[43]He also says that the PO Box address at Eumundi which appears on the contracts is not his.[44]
  1. [82]
    The plaintiff relied on expert evidence from Trevor Joyce, a forensic document examiner,[45]who examined the (original) contract documents, as well as (reproduction) sample signatures of Jeremy Gralike. Mr Joyce expressed the opinion that it is highly probable that Jeremy Gralike is the writer of the signatures on the three contracts, and that “[t]his is an opinion of near certainty supporting common authorship”.
  1. [83]
    Jeremy Gralike denies that he was the owner of the shed, the solar power system, or the hot water system, and denies that he purchased the shipping container. He says that Stanley and Sue Gralike were the owners of all of those things, even though they used his name for some of those transactions. He says that Stanley and Sue had constructed the shed, solar power system and hot water system on the property at their own expense. He says that those items were excluded from the contract of sale of the Tuchekoi property to QWI, and that those items were sold by Stanley and Sue, for their own benefit, in circumstances where they received the proceeds of sale.[46]
  1. [84]
    Although there are some parts of Jeremy Gralike’s evidence that are difficult to accept, and although the evidence does suggest some intermingling of the financial affairs of Jeremy, Stanley and Sue Gralike, and some questionable arrangements between them, on an analysis of all the evidence, I do not consider there is a basis to reject Jeremy Gralike’s evidence that he was not the owner of the various items contracted to be sold to Murphy Farming. I find that evidence to be supported by the following matters:
  1. (a)
    As Jeremy Gralike referred to in his submissions, he had borrowed almost the whole of the purchase price of the Tuchekoi property, and he could not buy “a shed and all those integrated parts with no money”. His evidence that Stan and Sue Gralike paid for the purchase of those items, having recently sold their own property(ies), is accepted.
  1. (b)
    In so far as the most documented of those items is concerned (the solar power system), the independent evidence of Mr Sippen supports what Jeremy Gralike says, because it is clear that Mr Sippen was dealing, in a substantive way, with Stanley and Sue, not Jeremy. It was only Jeremy’s name that was being used, for the documentation.
  1. (c)
    That conduct is explained by Jeremy Gralike’s evidence that his parents had used his name for various financial transactions, in order to protect their disability pension entitlements. This extended to the Noosa CBA account, which was opened in Jeremy Gralike’s name, but intended to be held for the benefit of his parents.
  1. (d)
    All of the negotiations and discussions concerning the sale of the shed, solar power system and hot water system took place between the Murphys and Stanley and Sue Gralike. At no point did the Murphys deal directly with Jeremy Gralike. Even on 28 December 2007 when Paul Murphy was at Tuchekoi to pick up the goods, nothing was said to him about Jeremy Gralike being the owner of the shed; and in fact, to the contrary, the conversation Paul Murphy describes, about payment being required, was had with Sue Gralike. The only reference to Jeremy Gralike was the initial direction from Sue Gralike for payment to be made to the Noosa CBA account, in Jeremy Gralike’s name, and that “all transactions will be in that name”, and after that, his name (and apparent, although disputed, signature) being on the three pieces of paper presented on 28 December. Those things are also consistent with the evidence already referred to, of Stanley and Sue Gralike using Jeremy’s name for various transactions.
  1. (e)
    The fact that Stanley Gralike paid Jeremy Gralike $1,500 for his help in dismantling the shed on 28 December is inconsistent with that being Jeremy’s property to sell.
  1. [85]
    Overall, I do not consider there is an objective basis on which to reject Jeremy Gralike’s evidence about ownership of the various items. His parents, Stanley and Sue Gralike, have not presented themselves to the court to give any contrary evidence. His explanation about ownership of the shed, solar power system and hot water system makes sense, having regard to the factual circumstances as at 2003/2004, when the property was purchased by him, and the shed and solar power system were purchased and constructed. Although there are some invoices and other documents bearing Jeremy’s name, there is an explanation for that, which is not inconsistent with his evidence that Sue and Stanley Gralike were in fact the owners of those things. Notwithstanding the fairly strident opinion expressed by Trevor Joyce, regarding the signature on the three “contracts of sale”, I am unpersuaded by the evidence of Mr Joyce to any contrary conclusion regarding the actual ownership of the goods.
  1. [86]
    In all the circumstances, I accept Jeremy Gralike’s evidence, and find, on the balance of probabilities, that the goods the subject of the agreement(s) with Murphy Farming were owned by Stanley and Sue Gralike, and that it was Stanley and Sue Gralike who contracted, on their own behalf, for the sale of those goods to the Murphys.

Terms of the agreements between Murphy Farming and Stanley and Sue Gralike

  1. [87]
    On the basis of the Murphys’ evidence, which I accept, I find that they entered into agreements (partly oral, and partly evidenced in writing) with Stanley and Sue Gralike, under which:
  1. (a)
    Murphy Farming agreed to purchase from Stanley and Sue Gralike the shed (with its built in  residence) for $60,000; the stand alone solar power system for $55,000 and the hot water system for $2,500 – with the details of what was agreed to be purchased, in relation to each of these three things, being set out in the written documents signed by the Murphys on 24 November 2007;
  1. (b)
    Murphy Farming agreed to pay an additional fee of $10,000 to Stanley and Sue Gralike, for Stanley Gralike to dismantle, pack and load onto the transport provided by Murphy Farming, all of the items the subject of (a) above; and
  1. (c)
    Murphy Farming also agreed to pay $2,530 for the red shipping container, acquired by Stanley Gralike in order to store the electrical items, after the shed was dismantled.
  1. [88]
    On the plaintiff’s case, there are two additional aspects to the terms of the agreements between Murphy Farming and Stanley and Sue Gralike:
  1. (a)
    first, that the agreement(s) to purchase the shed, solar power system and hot water system comprised an agreement to purchase a “single integrated construction” (as opposed to three separate components); and
  1. (b)
    second, as to the terms of delivery, and the point at which property (and therefore risk) in the goods subject of the agreements passed to Murphy Farming.
  1. [89]
    As to the first, I am not satisfied on the evidence that, objectively, the agreement between Murphy Farming and Stanley and Sue Gralike was for the purchase of a single integrated construction.
  1. [90]
    Paul Murphy’s evidence is that “[w]e attended the property to inspect the whole of the Shed, Solar System and Hot Water System as a whole single construction. We had communicated our interest in acquiring the entire construction to the Gralikes and they had reciprocated”. Cherry Murphy refers, in her affidavit, to discussions she and Paul had, about the benefits of buying the shed as well, if the sale fell through, instead of installing the solar power system on some other structure (I infer, of theirs), because they knew the solar power system would power the shed.[47]
  1. [91]
    However, while it might well have been the subjective intention of the Murphys that they were buying a “whole single construction”, I do not find that reflected in the documents evidencing the contracts, or the email exchanges between the parties. Originally, the agreement was to purchase the solar power system, which was advertised on its own (not together with the shed), and as a “stand alone” solar power system. The shed was later added to the transaction, when the sale of it to the third party fell through. After this, the solar power system was still being described as a “stand alone” system, in the email exchanges, and in the document signed by the Murphys on 24 November 2007. Although it might have been in the Murphys’ minds that they were buying a “whole single construction”; objectively, the evidence does not show that to have been a term of the agreement(s) ultimately formed between them.[48]
  1. [92]
    However, as will be addressed shortly, this finding does not impact on the plaintiff’s case because even when looked at as three agreements, it is apparent that the Murphys did not receive what they had bargained for. In so far as the solar power system and the solar hot water system are concerned, Murphy Farming did not receive any part of the goods that comprised those systems. In so far as the shed is concerned (keeping in mind that what was contracted to be purchased was a large industrial shed, with a residence built inside part of it), although Murphy Farming did take delivery of some parts of the shed, it is apparent from Paul Murphy’s evidence that a considerable part of it – including a large amount of the shed frame, all of the internal walls, flooring and windows of the shed, all plumbing and electrical wiring and all fixtures and appliances – was never received.
  1. [93]
    As to the second issue, I accept the submissions for the plaintiff, that:
  1. (a)
    It was a condition of the agreements that the sellers, Stanley and Sue Gralike, would dismantle, pack and load all the components comprising the three items purchased by Murphy Farming, onto transport provided by Murphy Farming. This is apparent from the additional, oral agreement reached, under which Murphy Farming agreed to pay $10,000 to Stanley and Sue Gralike to do this work.
  1. (b)
    On this basis, I accept that property in the items the subject of the agreement was not intended to pass until the point at which they were all dismantled, packed and loaded onto the transport.[49]
  1. (c)
    Plainly, property in the solar power system, and the hot water system, did not pass to Murphy Farming, because those items were not loaded onto Murphy Farming’s truck on 28 December 2007.
  1. (d)
    In so far as the shed is concerned, I accept the plaintiff’s submission that property did not pass to the plaintiff on 28 December 2007, in circumstances where only some parts of the shed were able to be loaded on to Murphy Farming’s truck on that day, with large components, including, it seems, most of the residence inside the shed, not ready and able to be loaded onto the truck on that day (including because some items had not been dismantled; some items had not been packed; and some items were damaged and had to be replaced).
  1. [94]
    Although I have not accepted the plaintiff’s argument, that the agreement was for an “integrated construction”, comprising the shed (with the residence inside), the solar power system and the solar hot water system, this does not affect the finding as to when property was intended to pass, under the agreements.
  1. [95]
    Since risk prima facie passes with property,[50]and although there was a delay in delivery, that was not the fault of Murphy Farming,[51]the risk in respect of the items contracted to be sold remained with Sue and Stanley Gralike.
  1. [96]
    Although not determinative, as submitted on behalf of the plaintiff, that property in the relevant goods remained with the Gralikes is consistent with their having made an insurance claim in respect of the alleged theft of the goods in February 2008 (and, it may be said, with Stan Gralike’s promises to the Murphys, following the alleged theft, that they would reimburse Murphy Farming for the money it had paid).

Is Murphy Farming entitled to recover the money it paid?

  1. [97]
    Murphy Farming is entitled to recover the money it paid, from Stanley and Sue Gralike, on the bases that:
  1. (a)
    the agreements it entered into with Stanley and Sue Gralike, to purchase the shed (with the house inside), the solar power system and the solar hot water system, were frustrated, because those agreements became impossible to perform by the parties, in circumstances where the remaining goods were (allegedly) stolen;[52]and
  1. (b)
    in any event, Stanley and Sue Gralike have been unjustly enriched, by retaining the money paid by Murphy Farming under the agreements, in circumstances where there has been a failure of the consideration for that payment (that is, delivery of all of the goods which Murphy Farming agreed to purchase).[53]
  1. [98]
    Murphy Farming paid the whole of the purchase price(s), and the fee for dismantling, packing and loading the various goods; and did not receive what it bargained for. It is entitled to recover the money that it paid.
  1. [99]
    Although Murphy Farming did receive some parts of the shed, I accept that having regard to all the components that it did notreceive, the bargained for shed (with the residence constructed inside) did not materialise; and that the parts which were received were of no use to Murphy Farming, without the remaining parts which were not capable of being delivered. I cannot discern any basis to sever part of the consideration paid by Murphy Farming under the contract for sale of the shed, by reference to the parts of the shed of which delivery was taken. In any event, Murphy Farming did offer to return the parts it had collected on 28 December 2007, an offer which was never taken up by Stanley and Sue Gralike.
  1. [100]
    In the circumstances, there will be judgment for the plaintiff against Stanley and Sue Gralike, the second and third defendants, for the sum of $130,030, plus interest (to be calculated).
  1. [101]
    In light of the conclusions reached regarding delivery, and the passing of property and risk in the relevant goods, it is unnecessary to address the plaintiff’s various alternative arguments.

Recovery of the money from Jeremy Gralike?

  1. [102]
    Counsel for the plaintiff submitted that, even if the court should find that Jeremy Gralike was notthe owner of the goods contracted to be sold to Murphy Farming, the plaintiff ought to be able to recover the money it paid from him in any event, because the money was paid to the Noosa CBA account, which bears his name, and because he received a benefit from some of the funds in that account (to the extent that those funds were used to pay part of his capital gains tax debt).
  1. [103]
    However, no such claim for relief is pleaded by the plaintiff against Jeremy Gralike. The plaintiff’s pleaded claims against Jeremy Gralike are the same as those pleaded, in the alternative, against Stanley and Sue Gralike, all of which arise from the agreement(s) with Murphy Farming; the basis for liability being dependent upon either Jeremy Gralike, or Stanley and Sue Gralike, being the owner(s) of the relevant goods the subject of the agreement(s), and therefore the contracting party(ies) with an obligation to perform the agreement(s). The (only) basis for the restitutionary claim pleaded by the plaintiff is total failure of consideration. There is no separate claim pleaded, for example, for relief against Jeremy Gralike for knowing receipt or retention of funds obtained fraudulently or in breach of trust.[54]
  1. [104]
    In the circumstances, it follows from the finding above, that Jeremy Gralike was not the owner of the relevant goods contracted to be sold to Murphy Farming, that the plaintiff’s claim against him ought to be dismissed.

Conclusion and orders

  1. [105]
    There will be judgment for the plaintiff against the second and third defendants, for the amount of $130,030, plus interest (to be calculated). The plaintiff is directed to provide a draft order, showing the amount of interest claimed, and the basis for the calculation.
  1. [106]
    The plaintiff’s claim against the first defendant is dismissed.
  1. [107]
    I will give the parties time to consider my reasons, before dealing with any applications for costs. In this regard, I note that the “non-parties”[55]were joined to this proceeding, in the context of the preliminary hearing as to whether or not Jeremy Gralike engaged or instructed Jeffery Cuddihy & Joyce, solicitors, and in circumstances where a claim for costs against the non-parties was foreshadowed in the plaintiff’s second further amended claim filed on 26 April 2016.

Footnotes

[1]T 2-55.15.

[2]See bank statements, annexed to the Affidavit of Samuel Barber (ex 3, vol 7, tab 33) at p 1369.

[3]She kept a diary note of this conversation (ex 3, vol 5, p 920).

[4]Affidavit of Gavin Cummings (ex 3, vol 5, tab 26).

[5]She also kept a diary note of this conversation (ex 3, vol 5, p 922).

[6]Affidavit of Chris Anderson (ex 3, vol 7, tab 37) at [8].

[7]T 1-57.

[8]Affidavit of Di Harris (ex 3, vol 5, tab 24) at p 778.

[9]Affidavit of Michael Kearney (ex 3, vol 5, tab 24) at p 740.

[10]T 2-58.38.

[11]Affidavit of Thomas Grady (ex 3, vol 4, tab 16).

[12]Affidavit of Geoff Wise (ex 3, vol 5, tab 20).

[13]See “list of items and values” said to have been provided to the insurer by the Gralikes (ex 3, vol 5, p 778).

[14]Annexed to the affidavit of Paul Murphy (ex 3, vol 6, tab 29) at p 1111.

[15]Affidavit of Sarah Curtis (ex 3, vol 4, tab 18).

[16]Cf list at ex 3, vol 5, p 778; also email from Sue Gralike at ex 3, vol 6, p 1111.

[17]Affidavit of Cherry Murphy (ex 3, vol 5, tab 28) at [78].

[18]Affidavit of Ross Caulfield (ex 3, vol 4, tab 19).

[19]Affidavit of Michael Thexton (ex 3, vol 5, tab 22).

[20]T 2-60.27.

[21]Cf the “list of items and values” said to have been provided to the insurer by the Gralikes (ex 3, vol 5, p 778), which does not appear to include a house frame.

[22]Affidavit of Warren Steele (ex 3, vol 5, tab 27); list of items at ex 3, vol 5, p 778.

[23]Affidavit of Norma Grady (ex 3, vol 4, tab 17) at pp 656-661.

[24]Ex 3, vol 4, p 455.

[25]Affidavit of Jeremy Gralike (ex 3, vol 7, tab 36) at [62]

[26]Witness statement made on 9 April 2014 (ex 3, vol 4, pp 444-457); much of which is replicated in his affidavit sworn 13 May 2016 (ex 3, vol 7, tab 36).

[27]Affidavit of Jeremy Gralike sworn 30 November 2011 (ex 3, vol 3, p 4) at [16(i)].

[28]T 2-75.6-.18.

[29]Jeremy Gralike statement (ex 3, vol 4, p 450).

[30]Jeremy Gralike at T 2-48.42.

[31]Jeremy Gralike at T 2-49.20 and .45. An amount of $20,000 on 11 January, and four amounts totalling $49,000 on 14 January 2008 – see the bank statements annexed to the affidavit of Samuel Barber (ex 3, vol 7, tab 33) at p 1369.

[32]T 2-65.35.

[33]T 3-17.42.

[34]Mr Cuddihy’s oral evidence at T 1-86.33.

[35]Affidavit of Chris Anderson (ex 3, vol 7, tab 31) at [70].

[36]Affidavit of Neil Luckett (ex 3, vol 5, tab 23).

[37]T 2-57.35.

[38]Affidavit of Di Harris (ex 3, vol 5, tab 24) at p 787.

[39]Ibid, at p 793.

[40]Affidavit of Ilya Sippen (ex 3, vol 3, tab 7).

[41]See ex 3 at pp 225, 226 and 228.

[42]Affidavit of Ian Hamblin (ex 3, vol 3, tab 8) at p 232.

[43]T 2-51.2 and 2-52.

[44]T 2-51.7.

[45]Affidavit of Trevor Joyce (ex 3, vol 5, tab 25).

[46]Affidavit of Jeremy Gralike sworn 30 November 2011 (ex 3, vol 3, tab 1) at [16]-[22].

[47]Ex 3, vol 5, tab 28 at [12].

[48]Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 at [40]; Electricity Generation Corp v Woodside Energy Ltd (2014) 251 CLR 640 at [35].

[49]See s 3 (definition of “goods”), ss 20(1), 20(2), 21 and 23(1) of the Sale of Goods Act 1896 (Qld).

[50]See s 23(1) of the Sale of Goods Act 1896 (Qld).

[51]Cf s 23(2) of the Sale of Goods Act 1896 (Qld).

[52]Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337 at 356-7 per Mason J; and the summary of relevant principles in Hillcrown Pty Ltd v O'Brien [2011] QCA 129 at [23] and [35] per Chesterman JA and at [47]-[53] per Peter Lyons J.

[53]Equuscorp Pty Ltd (formerly Equuscorp Financial Services Ltd) v Haxton (2012) 246 CLR 498 at [30]-[31] per French CJ, Crennan and Kiefel JJ.

[54]Cf Heperu Pty Ltd v Belle (2009) 76 NSWLR 230.

[55]The so-called “non parties” were joined on application by the plaintiff, apparently in reliance upon the definition of “party” in rule 679 of the Uniform Civil Procedure Rules 1999 (Qld) which, for the purposes of chapter 17A of the Rules (dealing with costs), defines a party as including “a person not a party to a proceeding by or to whom assessed costs of the proceeding are payable”.

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Editorial Notes

  • Published Case Name:

    Murphy Farming Pty Ltd as Trustee for the Murphy Farming Trust v Gralike & Ors

  • Shortened Case Name:

    Murphy Farming Pty Ltd v Gralike

  • MNC:

    [2016] QDC 126

  • Court:

    QDC

  • Judge(s):

    Bowskill DCJ

  • Date:

    01 Jun 2016

Appeal Status

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