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Robinson v Dairy Brokers Australia Pty Ltd QDC 148
DISTRICT COURT OF QUEENSLAND
Robinson & Ors v Dairy Brokers Australia Pty Ltd & Ors  QDC 148
CYRIL ALAN ROBINSON, THELMA JEAN ROBINSON and DALE McGREGOR ROBINSON trading as CA, TJ & DM ROBINSON (a firm)
DAIRY BROKERS AUSTRALIA PTY LTD
(ACN 107 781 019)
District Court at Brisbane
DELIVERED EX TEMPORE ON:
25 May 2016
2, 3 and 4 December 2015; 23, 24 and 25 May 2016
Judgment for the defendants
CONTRACT – Misrepresentations - Sale of 90 dairy cows – credit – inherent improbability of evidence
Trade Practices Act 1974 ss 52, 82
T.G. Lambert for the plaintiffs
D. Favell for the first and second defendants
B. Kent for the third defendant
Turnbull Mylne for the plaintiffs
Emmerson Legal for the first and second defendants
Munro Legal for the third defendant
- In this matter the plaintiffs claim from the first and second defendants damages in the sum of $610,000 pursuant to s 82 of the Trade Practices Act 1974 (the Act) arising out of an alleged breach by those defendants of s 52 of that Act. Alternatively, they claim damages resulting from the negligent advice of those defendants. They seek damages in the same sum from the third defendant for breach of contract. The defendants each deny the entitlement of the plaintiffs to any damages.
- The action arises out of the sale of 90 Illawarra dairy cows owned by the third defendant to the plaintiffs. The first defendant is a company and the second defendant was, at the time of the sale, the first defendant’s sole director. The company operates a business brokering the sale of dairy cattle and in this case facilitated the sale of the cows from the third defendant to the plaintiffs.
- In short, the plaintiffs decided in 2008 to change the focus of their farming property in Murgon from lucerne, cattle and grain to dairy. They arranged a loan from their bank, Suncorp Metway, to enable the necessary capital improvements, including purchase of a suitable herd, to be effected. In late 2008, Mr Cyril Alan Robinson (hereinafter Mr Robinson) contacted the second defendant, Mr Gleeson, to ascertain if he knew of any cows for them to purchase. Ultimately the plaintiffs entered into a contract to buy 90 cows from the third defendant, Mr Luck, for $1,300 plus GST per head, a total of $127,800. The cows were delivered in two batches on 6 March and 27 March 2009. The plaintiffs allege the cows were unsuitable, not what had been represented to them and not what they had agreed to purchase. They allege their milk production was far below what had been represented to them. Ultimately, the plaintiffs resolved to sell the cows because they were unsuitable. They did so, selling 84 cows – because six had died – together with a milk supply contract they had with Dairy Farmers Milk Cooperative Limited to a Mrs Rachael Parkes for $124,740, inclusive of GST. That sum was paid by Mrs Parkes to the plaintiffs on 23 July 2009. The sum claimed as damages by the plaintiffs is in accordance with a report of a forensic accountant, Mr Onus Maynes.
- The principle issue involves the determination by me of the circumstances of the sale by Mr Luck to the plaintiffs of the 90 cattle. The evidence given by the plaintiffs on the one hand and by Mr Gleeson, Mr Luck and Mrs Parkes on the other was vastly different. Resolution of that matter involves determination of significant questions of credit.
Improbability of Plaintiffs’ Claims
- Early in the proceedings I perceived there were a number of inherently surprising aspects of the plaintiffs’ case which makes the proposition that they entered into and completed the contract to purchase cows from the third defendant in the circumstances they described improbable.
- First, each of Dale Robinson and his father Mr Robinson said in evidence that on two occasions they went to the third defendant’s property, in the company of the second defendant, to inspect lactating cattle that they hoped to purchase. On each occasion they said they were precluded from inspecting Mr Luck’s dairy herd. They each said that what few cattle they did see were dry cows or young heifers, which were not suitable for their purposes. They also said that on the first visit Mr Luck kept them waiting for some hours before he turned up and again kept them waiting for about an hour on the second occasion.
- Second, the evidence of both Dale and Mr Robinson was that when the contract for the purchase of 90 cows was executed, for a total price of $128,700, the contract form was blank (other than for the printed portion and the names of the parties). They said the signatures of the third defendant and that of Dale Robinson were then added. Each of the male plaintiffs said that the second defendant said he would fill in the details later. In the circumstances, including those set out in the previous paragraph, it is very surprising they would have agreed to purchase 90 cows from the third defendant by way of a blank contract.
- Third, although the plaintiffs had entered into a contract for the supply of milk to Dairy Farmers Cooperative Pty Ltd, effective from 1 January 2009, and although both Dale Robinson and Mr Robinson said that the dairy was then ready for production, Mr Robinson says he subsequently agreed, on the plaintiffs’ behalf, to a request from the third defendant that the delivery of the cattle be delayed some two months, to enable the third defendant to complete his supply contract to another milk company, Parmalat. In circumstances where the evidence called on behalf of the plaintiffs was they were then relying on borrowed money, and did not have any other significant source of alternative farm income, it seems inherently improbable that they would agree to delay the delivery of the cows in order not to inconvenience the commercial interests of the third defendant, but to their own commercial disadvantage. This scenario is made even more improbable by the assertion made in evidence that it was vitally important that all of the cattle be lactating, so that they could “hit the ground running”, as it was described. Indeed their counsel commenced his cross examination of the second defendant by suggesting he had been told “We’re starting a new dairy operation. We need full production from the word go”. That proposition is inconsistent with the view they readily forewent milk production after 1 January 2009 to meet Mr Luck’s interests.
- Fourth, when the cattle did arrive they came in two deliveries on 6 March and 27 March 2009. In his opening it was stated by the plaintiffs’ counsel that about 10 or 11 of the cows had horns, which was not suitable because, as they had told the second defendant, they had a herringbone dairy unsuitable for cows with horns, that six of the beasts were very young with no developed udder and that others were dry and only about 10 or 11 were lactating dairy cows. Dale Robinson said he complained to the driver of the delivery truck about the cows but there is no suggestion either he or his father or anyone else on behalf of the plaintiffs spoke to the second or the third defendant to complain. Dale Robinson did say that he tried to contact the second defendant on two occasions but was told on each occasion by a woman in the first defendant’s office that Mr Gleeson was unavailable. In evidence Mr Gleeson said he had a mobile phone and was always able to be contacted. Given that the next delivery was not until three weeks after the first it is very surprising that he was unable to make contact. The second delivery, according to the plaintiffs, included three young heifers, eight or nine dry cows with blue tape attached to their tails and other dry cows with no such tags. Dale Robinson said that he was told by the driver that two cows had recently calved and so the third defendant had substituted three heifers in their place. Again the plaintiffs said a complaint was made to the delivery driver. Mr Robinson said that after this second delivery he contacted Mr Luck to complain but says Mr Luck dismissed his complaint by saying words to the effect “stiff luck mate. You will have to wait until next season”. They did not then take any immediate steps, such as writing to the defendants, designed to reach redress.
- In my view, it is inherently improbable that the plaintiffs (a) would have signed a largely blank pro-forma contract as they assert; (b) would have entered into a contract to purchase cows form the third defendant if they had not inspected them and indeed had been actually denied seeing them; (c) would have agreed to defer delivery of the cattle in order to suit the third defendant; and (d) would not have contacted either the third defendant or the second defendant, immediately after the first delivery, which on their case clearly did not comply with what they say they had purchased.
- Having regard to those improbabilities, which were generally apparent to me from the opening of the case, I shall consider the evidence of the parties at the trial.
- Dale Robinson is the son of Mr and Mrs Robinson. They trade as a partnership. He said that up until 2008 he and his parents had produced grain, lucerne and beef cattle from their property, but that as a result of declining income from those sources they made a decision to enter into dairy production. They had some previous experience of dairying but some time ago. They presented a business plan to their bank, Suncorp Metway in Kingaroy, and were provided with a loan of $280,000. Grain production was ceased in early 2008 and the property was returned to pasture. The farm was remodelled, with smaller paddocks and laneways to facilitate dairy production. Dale Robinson said they were blessed with water, having water in each paddock and that a new bore was put down as a backup. The existing dairy was rebuilt. Dale Robinson said that in early 2008 they were ready for dairy production. In anticipation of that, on 24 October 2008, they entered into a contract to supply milk to Dairy Farmers Milk Cooperative Pty Ltd. It provided for the supply of 110,000L (and a minimum of 99,000L) over each 6 month period commencing 1 January 2009 for a period of 2 years. I note this is equivalent to a daily supply of 602L (and a minimum of 492L/day), and a pickup of 1208L, since milk is picked up every 2 days.
- The plaintiffs began taking steps to source a herd. In late October/early-November 2008 the second defendant, after speaking to Mr Robinson, facilitated a visit to the property of the third defendant at Laidley. Dale said that when they got to the farm the third defendant was not present. They waited two to three hours for him to arrive. When he did arrive, Dale Robinson said that the second and third defendants spoke privately, before the third defendant left. He said that the second defendant then indicated that he would show them the cows and that they drove in convoy until they saw a number of cows. Dale Robinson said that the second defendant told him that those they saw were similar to the cows that they could purchase. Dale Robinson said however that the cows were dry, some were young and there was a bull. He said there were about 15 to 20 cattle in all. He said they were in reasonable condition but dry. Dale Robinson said they told Mr Gleeson that they would like to see the dairy herd, and also see them being milked. He says that the second defendant replied that the dairy was “over there”, indicating somewhere in the distance, and said that the third defendant would probably have finished milking. He indicated however that the cattle that they were looking at were similar to the dairy herd and that the third defendant was producing 1,600L per pickup. It does not seem there was any mention of the number of cows in the herd, at least at that stage. Dale Robinson said that they asked the second defendant if they could come another day to see the herd and that was agreed upon.
- They did so on 20 November 2008. They met at the property of the third defendant. He was again absent, but turned up after about half an hour, spoke privately to the second defendant but again left. Dale Robinson said they were taken to see the same herd in the same paddock as they had previously seen. Again they asked if they could see the dairy herd but were told that it would not be possible to get up there as there had been a lot of rain and the ground was boggy. He said that the second defendant said that he himself had nearly got bogged that morning. He said the second defendant again said that the cows they were looking at were similar to those in the herd but that all in the herd were lactating and the herd would produce 1,600L per pickup. Dale Robinson said they again asked to see the herd but were told that it was too boggy and too far to walk. Dale Robinson said he indicated to Mr Gleeson that they had only seen dry cows but said the second defendant responded saying that it was a very good herd producing 1,600L and that they could not go wrong. Dale Robinson said that the second defendant indicated he would “guarantee it”. He said the plaintiffs asked for dairy herd records but there was no response from the second defendant and that they were in any case never shown to him.
- He said they then discussed how many cows they wished to buy. Dale Robinson said that they only wanted 70 but the second defendant told him that Mr Luck preferred to sell his whole herd. Eventually he said the second defendant said Mr Luck would be prepared to sell 90 cows and they agreed to purchase that number. He said they only agreed because the second defendant continually told him how good the cows were. Again, he said they asked the second defendant for the dairy herd records and Dale Robinson said that on this occasion the second defendant said “I’ll see if I can get those for you”.
- At that stage Dale Robinson said that Mr Luck appeared and signed a contract for the sale of the cows. When the plaintiffs were shown the contract Dale Robinson said he saw that it was blank. He said there was no indication of how many cows were to be purchased, the cost of the cows or even a description of the cows. He said that they asked about that, but that the second defendant responded; “Don’t worry I’ll fill that out. This will get the ball rolling”, or words to that effect. He said he then signed one copy of the contract on the bonnet of a vehicle. He said they were not given a copy of the contract, and in fact did not receive a copy until after the cattle had arrived in March 2009. He said it arrived in an envelope with no covering letter. He said after he signed he again asked the second defendant for reassurance that the cattle would be lactating and said the second defendant said that they “all would be”.
- He said Mr Gleeson said that he would organise transport. Mr Robinson said he subsequently rang the second defendant about the transport of the cows. He gave evidence that the second defendant said that he was trying to organise it but that Mr Luck, while he wanted to honour the contract, wanted to keep the herd for a further one to two months before giving it away, in order to meet his own milk supply contract obligations. Mr Robinson said he agreed to that proposal. He said he was not sure if that agreement to defer delivery was before or after payment of the $127,800 for the cows, of which payment was made on 17 December 2008.
- Dale Robinson said that when the first delivery of 45 cows arrived on 6 March he immediately noticed there were a number of young heifers. While they were in good condition, they were not lactating. He also said that 14 or 15 had horns, contrary to what they had told the second defendant they required. Dale Robinson said that he spoke to the driver about the quality of the herd and attempted to ring the second defendant on a number of occasions. On contacting his office, he said he was always told the second defendant was unavailable.
- Dale Robinson said that when these 45 cows were milked they produced only about 290L per pickup, well short of half what he says was the represented figure.
- The next 45 cows arrived on 27 March. Dale Robinson said they were again not what the plaintiffs wanted or had purchased. He again complained to the driver. He said there were three very young heifers, a number with horns, six or seven which were dry with blue installation tape on their tails and others dry, but with no tape.
- Dale Robinson also said that in late 2008 to early 2009 conditions on their property were reasonable but that subsequently water was less available and the quality of pasture decreased. He said that at some stage, probably in about late May or early June of 2009, SunWater restricted their irrigation rights. Subsequently, he said that about six weeks before the cows were eventually sold by the plaintiffs (on 22 July 2009) SunWater terminated their right to irrigate and pastures quickly thereafter declined. This would have been in about early/mid-June 2009, 3 months after delivery of the cows.
- Much of what Dale Robinson said in evidence was corroborated by his father. I should indicate that whilst there were four persons from the plaintiffs’ family who visited the third defendant’s dairy farm, one, a brother of Dale Robinson, suffers from a significant problem associated with a brain tumour he developed at age five and so his not giving evidence was very explicable. Mrs Robinson gave evidence but it seems that she did not leave the car for most of the time when inspections were undertaken, and was not party to any relevant conversations. Consequently, her contribution to the issues in dispute was very limited.
- Mr Robinson indicated he was born on a dairy farm. While he had not dairy farmed for some years, he said he had significant experience as a dairy farmer, either on his family farm or in working for others. He had also been on a farm all his life. He spoke of the decision to go from grain to dairy in 2008. He said that they approached their bank, Suncorp Metway, in Kingaroy and obtained a loan of $280,000 to facilitate that transition.
- He said the plan was to buy 70 head of lactating cows because, “that way we get immediate production”. I mention that because it seems to be relevant to the issue of credit concerning his evidence about the agreement he said he made to defer delivery of the cows to meet the convenience of the third defendant. He also said he specifically told the second defendant that they had a herringbone dairy “so didn’t want cattle with horns”. He said when the second defendant first contacted him about visiting Mr Luck’s property the second defendant said that the third defendant had “very good lactating dairy cows”. He said they first visited the property in the last week of October 2008. He said Mr Luck was not there when they arrived. He said they had to wait about an hour before he turned up on a motorcycle, spoke briefly to the second defendant and then left without speaking to them. He said that the second defendant told them that he was instructed to show the plaintiffs the dairy cows, which were in another paddock. He said they followed the second defendant to a paddock where they saw “eight or nine cows that looked like dairy cows”. He said they were, however, not lactating. He said he commented to the second defendant “blind Freddy can see they are dry”, but did say that they were in “okay condition”. He also said that two had crumpled horns. Somewhat curiously in such circumstances he says the second defendant said “I can guarantee the dairy herd will be identical in structure to these”. He also said that the second defendant had said that he could guarantee that the cows produced “1,600 litres of milk per pickup”. Mr Robinson said he asked the second defendant if they could inspect the lactating dairy herd and said that Mr Gleeson replied that they would have already been milked. Why that might have deterred the plaintiffs from seeking an inspection is unknown. He said that Dale commented to the second defendant that the cows they had seen were dry. He said they were able to see a number of other cows about 600m to 700m away and that Dale went to inspect them. He said when Dale returned he said, in the presence of his father, to the second defendant “They’re 27 young heifers. There’s no lactating cows at all. There’s a bull with them”. He said they then left but arranged to revisit on 20 November.
- On that next occasion they again met the second defendant. Again Mr Robinson said the third defendant turned up late, this time after about one hour. He said he asked on several occasions to see the dairy cows and the dairy but that the second defendant told them they would not be able to get there “due to rain”. Like his son he said that the second defendant said that he himself had nearly got bogged. Mr Robinson commented that they could walk but said the second defendant told him it was too far. He said that he accepted that. He said he himself could see only one cow nearby. He said when Mr Luck arrived they were shown some further cows, about 14 which were spread throughout the paddock, but that all were dry. Mr Robinson said he hoped the cows he purchased would not be “like that” – indicating a particular cow. He said she was a very old cow, her udder is out of proportion and she was dry. Her teats were, he said, not uniform in size. He said all of the cows he saw were dry, although conceded they were in good condition. He said that, once again, the second defendant said they could not see the dairy due to the wet conditions.
- Extraordinarily, in such circumstances, he says that the second defendant then produced a blank pro-forma contract saying “we’ll get this signed”. There was discussion about price and numbers to be purchased. He said a price of $1,300 per head was agreed upon but that Mr Luck wanted to sell the whole herd, about 110 cows. Mr Robinson said he wanted to purchase only 70. Eventually they agreed on the purchase of 90. Again, Mr Robinson said he was reassured by the second defendant that “they” were producing about 1,600L per pickup. Mr Robinson said that he commented “I wouldn’t mind seeing proof”, but said that did not occur. He indicated that he had “never seen a lactating cow at Mr Luck’s”. Although when the contract was presented, he said it was completely blank, other than for Mr Luck’s signature, Dale Robinson then signed the contract upon the second defendant’s assurance that the second defendant would fill out the details of the contract later and “just wanted to get the ball rolling”.
- Subsequently, he says he had the discussion in which he agreed to delay receipt of the cattle for one or two months in order to give Mr Luck the opportunity to honour his milk supply contract. I have referred to the improbability of this already. He said he is not sure if this was before or after he had paid the purchase money – which was in late December 2008 – but thought that it may have been after. He said at that stage their dairy was ready to use.
- Subsequently, he says he rang Mr Gleeson in respect of transport but was told delivery was again to be delayed for about a fortnight, as the cattle did not have their National Livestock Identification System (NLIS) tags. Subsequently, when the first group of 45 cattle were delivered on 6 March he says five or six were horned heifers and very young, another 14 or 15 had horns and some were dry. In all, he thought there were about 15 or 17 heifers. Curiously he says he spoke to the driver about his concerns but did not immediately contact the defendants. Later he says he tried to ring Mr Gleeson several times. He says that he rang the office and spoke to a lady but that at all times was told the second defendant was unavailable. He said that he had tried to ring on both 7 March and again about ten days later.
- Subsequently, the second load arrived on 27 March, again containing about 45 head. He says there were dry heifers, some cows that were a bit old and nine to ten had blue insulation tape on their tails. He says he asked the driver about that and was told that the second and third defendants had told him, the driver, to tell the plaintiffs that they were dry cows. He also said there were three dry heifers and that he was told by the driver that two cows had calved and these heifers were in substitute.
- Subsequently, Mr Robinson says he rang Mr Luck the following day. He says this was the first actual conversation he ever had with the third defendant. He says he told Mr Luck that the load contained a number of dry cows and a number of young heifers with very small udders, and that four had foot rot. He also said he asked Mr Luck why he had not been sent the dairy herd book, which he said was of vital importance. He said Mr Luck replied; “Stiff titty mate. I always kept the particulars in my head”. He also said the third defendant said; “Stiff titty mate. You’ll just have to wait until next season” and then hung up.
- Told in this way, it is, in my view, immediately apparent that the plaintiffs’ version of events is inherently improbable. In my view, many features of their case are not in accord with common experience, and when viewed collectively, make it very difficult to accept their evidence.
- By contrast I was generally impressed by the evidence of Mr Gleeson and accept the honesty of Mr Luck’s evidence. The evidence they gave seemed to me to more accord with common experience than that of either Mr Robinson or Dale Robinson.
- Mr Gleeson was very experienced in the dairy industry, though principally in the marketing of dairy product. He worked for Norco, a major dairy company, for about thirty years and during the last 18, up until 1996, was its Queensland manager. In 1992, he had purchased a dairy farm. Initially his brother, and then Mr Gleeson himself managed it. He sold it in 2003. He formed the first defendant company and operated it as a dairy brokering business from about 2002. His sons now are its directors, but he works as a consultant to it.
- He said he did not know either of the Robinsons or Mr Luck prior to the subject transaction but conceded he may have met Mr Luck. He said he had, in 2008, heard that Mr Luck may have Illawarra cows he was interested in selling. He said that Mr Robinson phoned him on 31 October 2008 and asked if he had any “Illawarra cows on your books”. Mr Gleeson says he told Mr Robinson did not but may be able to locate some. More importantly he says he asked Mr Robinson why he wanted Illawarra cows and was told by Mr Robinson that he already had some Illawarra cows and was going to build on that.
- I interpose that evidence was given at the trial by John Cochrane. He is a very experienced dairyman. Amongst other things, he is a dairy cattle judge and chairman of a board of a major supply group. He is also an auctioneer and dairy broker. He said that 82% of the Queensland dairy cattle are black dairy Holstein-Friesian cows, and that the market for Illawarra cattle is more limited.
- I also add that the fact that Mr Robinson already had Illawarra cattle was confirmed in evidence by Mr Gleeson. He said he went to the Robinsons’ farm near Murgon shortly after the Robinsons had first gone to Mr Luck’s property on 5 November 2008. On that occasion he said Dale Robinson drove him to see their “existing red cows”. He said there was a “red bull and nine or ten heifers”. It was not suggested to him in cross-examination that he had not been shown those cattle. I accept that he was shown them. No doubt the fact that the Robinsons already had the beginnings of a red cow herd influenced their decision to seek more such cows through Mr Gleeson. That assists me in concluding that Mr Robinson specifically asked for Illawarra cows when he first made contact.
- After the phone call of 31 October Mr Gleeson rang Mr Luck, who confirmed he had Illawarra cows for sale. Mr Gleeson arranged for the Robinsons to visit Mr Lucks’ property to view the cows on 5 November 2008. He met them at Gatton. He said they were one and a half hours late but they all then drove to Mr Luck’s property, arriving there about midday. Contrary to the evidence of both Dale Robinson and Mr Robinson, but consistent with that of Mr Luck, Mr Gleeson said that Mr Luck was there throughout the inspection. He said that Mr Luck walked through the dairy herd with Mr Robinson and Dale Robinson. Mr Gleeson, who estimated there were about 70 or 80 cows in the herd, said he stayed at the cars with Trevor Robinson and Mrs Robinson. He said Mr Robinson returned after only about five minutes but that Mr Luck and Dale Robinson continued viewing the cattle, and apparently talking, for about one to one and a half hours. After they returned Mr Gleeson said both Mr Robinson and Dale Robinson indicated that they liked the cows. Mr Gleeson said he knew that the Robinsons had a herringbone dairy but that Mr Luck had a walkthrough dairy. It is unnecessary to go into the details of such dairies but the witnesses all seemed to agree that cows, used to a walk through dairy, can be a little problematic if moved to a herringbone dairy. Mr Gleeson said that, aware of such possible issues, he asked the Robinsons if they wanted to view Mr Luck’s dairy. He said they indicated that they did not, and said they had to leave but wished to return another day to view the herd a second time. Mr Luck also said in evidence that the Robinsons had refused his offer for them to view the dairy.
- After that inspection Mr Gleeson said he visited the Robinsons’ property near Murgon. It was then he said that he viewed the red bull and nine to ten red heifers that I earlier referred to. Mr Gleeson said on that occasion the Robinsons indicated to him that they wanted to make an offer of $1,200 plus GST, but for only 70 cows.
- Mr Gleeson subsequently rang Mr Luck and told him of that offer. He said Mr Luck refused it saying “ain’t enough money and ain’t enough cattle”. He said he rang Dale Robinson and told him what Mr Luck had said. On that occasion they arranged a second inspection, which took place on 20 November. Mr Gleeson said that he thought only Dale Robinson had come on that second occasion but said it was possible he was mistaken and other members of the Robinson family were also present. I accept they were, but that does not cause me to doubt Mr Gleeson’s credit. He said however that all negotiations on behalf of the Robinsons on that day were with Dale Robinson.
- The meeting again took place on Mr Luck’s property. At the commencement of it Mr Gleeson said the cattle were “right on the road”, consistent with what Mr Luck subsequently said. I should also note that when Mr Gleeson gave evidence Mr Luck was not in the courtroom. Mr Gleeson said that, even before they had spoken to Mr Luck, Dale Robinson had told him that they would take 90 cows at $1,300 per head. Mr Gleeson said in evidence all sales in the industry are “plus GST”. In any case, Mr Luck ultimately accepted that offer and Mr Gleeson got what he called his “private sales book” from his car. He says he filled out the contract, and both Mr Luck and Dale Robinson signed.
- A copy of the contract is at Tab 4, Exhibit 1. Mr Gleeson said all of the handwriting on the printed pro forma contract was written on that day prior to the parties signing, other than plaintiffs’ farm’s PIC number, QJMGO154. He said Dale Robinson did not remember that number on the day and it was supplied later. The contract provides for the sale of “90 red cows” for “$1300 + GST” and that “cattle must be paid for before leaving the vendor farm”. Details of the vendor and purchaser, the date of the contract, delivery instructions and the commission rate of 5% payable by Mr Luck to Mr Gleeson are all handwritten into the document.
- In my view the signing of a blank contract, not only by Dale Robinson but also by Mr Luck, would have been most unusual. I do not accept either would be likely to sign a blank document. The prospect of both doing so is exceedingly remote. The Robinsons’ evidence about that happening is, in my view, very clearly wrong. I accept the evidence of Mr Gleeson about the pre-contractual negotiations and formation of the contract and about the signing of the contract.
- That finding is fortified by subsequent events. Mr Gleeson said Dale Robinson told him the Robinsons’ dairy was not yet ready and asked if Mr Luck could keep milking the cows until it was. He said Mr Luck agreed to that proposal. Mr Gleeson says this was the reason the delivery was put off until March 2009. In my view this explanation also accords with common sense. The explanation of the Robinsons, that Mr Luck asked if delivery could be delayed to meet his commercial convenience, and that the Robinsons agreed in circumstances where their own supply contract with Dairy Farmers Milk Cooperative Ltd was effective from 1 January 2009 is improbable. I have also already noted that at the very commencement of Mr Gleeson’s cross-examination counsel for the plaintiffs put to Mr Gleeson that on the very first telephone contact Mr Robinson had with him, Mr Robinson said to Mr Gleeson “we’re starting a new dairy operation. We need full production from the word go”. Mr Gleeson denied that that had been said, but in my view, the agreement of Mr Robinson, as he asserts, to put off delivery of the cattle to meet the convenience of Mr Luck, contrary to the commercial interests of his own family, is clearly contrary to the suggestion that they needed full production from the word go. It is also inconsistent with discussions that he says they had with their bank when borrowing the money. All of those conversations appear to be premised on the basis that there was some imperative in quickly getting a herd and quickly starting production. In my view the suggestion that in such circumstances the Robinsons would have agreed to defer delivery for a period of some months to meet the commercial convenience of Mr Luck is very improbable.
- Further, at the meeting when the contract was signed Mr Gleeson says he suggested to Dale Robinson that the cows be delivered in two batches to enable them to more easily integrated into the Robinsons’ herringbone dairy. Again, this accords with common sense and experience and with what eventually occurred.
- Mr Gleeson also said that at this meeting he asked Dale Robinson when he would “select the cows”. It was of course necessary to select the cows because the Robinsons were not purchasing all of Mr Luck’s herd. He said Dale Robinson indicated that they were happy to let Mr Luck select the cows to be delivered. In so agreeing, the Robinsons had confidence in the good faith of both Mr Gleeson and Mr Luck. The Robinsons’ evidence that the cattle they inspected were not lactating cattle, were young heifers or dry cows, that they were denied access to the dairy herd or to the dairy records and the herd book despite their request to view them, and were kept waiting for Mr Luck to arrive on both occasions, yet nevertheless signed a blank contract and left it to Mr Luck to select what he chose from a then unseen herd, in my view, defies belief.
- The evidence of Mr Gleeson that Dale Robinson left it to Mr Luck to choose the cows to send to the plaintiffs, whilst perhaps a little naive, is consistent with Mr Gleeson’s evidence that the Robinsons on 5 November 2008 and Dale Robinson on the second inspection had inspected a dairy herd of good uniform quality, were pleased with what they had seen and trusted Mr Luck to be fair in his allocation of cattle to be sent to them. Such trust was unlikely to be reposed in a man who, according to the Robinsons, had kept them waiting for up to three hours on the first visit, hardly spoke to them and refused or at least failed to allow them to inspect the herd instead showing them only unsuitable, dry or very young cows or heifers. So too Mr Gleeson denied the suggestion put to him, consistent with the evidence of Mr Robinson and Dale Robinson, that he had rebuffed their request to view Mr Luck’s dairy saying it was “too boggy” and that they would not therefore be able to drive there. Tellingly he said – again in accordance with common sense – that all dairies in Queensland require an all-weather road to allow access for milk supply trucks. That too, in my view, militates against acceptance of the Robinsons’ evidence about that conversation.
- Subsequently Mr Gleeson says he was given the plaintiffs’ PIC number in a phone call soon after the signing of the contract on 20 November. An invoice directed to Mr Robinson is at page 149 of Exhibit 2. It is dated 24 November 2008, in the sum of $128,700. That sum was paid by the Robinsons on 17 December 2008 (see plaintiffs’ bank statement at page 150 of Exhibit 2).
- Payment at that time is also entirely consistent with Mr Gleeson’s evidence that on 14 December 2008, Mr Luck rang him and indicated he had changed his mind – he no longer wanted to sell the cows. Mr Gleeson says he told Dale Robinson of this and that, understandably, Dale Robinson was angered and upset by Mr Luck’s change of mind. I have no doubt that, in response, the Robinsons paid the invoice, as appears from their bank statement on 17 December. That had, as might have been hoped by the Robinsons, the effect of causing Mr Luck to again relent, and determine to proceed with the sale.
- Mr Gleeson says Dale Robinson did not ring him to request the cows be delivered until 16 February 2009. He said Dale Robinson told him in that conversation that the “dairy was almost completed”. Mr Luck then arranged transport, with the first delivery to take place on 6 March. He went to Mr Luck’s early that morning. He observed Mr Luck and his brother milk the herd then assisted them in drafting the 45 cows to be sent to the Robinsons. He said they were all milking cows as inspected by the Robinsons in November 2008. The second delivery on 27 March was completed in an identical procedure.
- Mr Gleeson says that the second group included six “springer” cows. This is a reference to the fact that they were about to calve. The process whereby cows are covered by a bull and “dried out” for about six weeks prior to calving to enable them to gain strength due to not being milked and then returned to the milking herd about one week after calving, was explained in evidence. I accept that this was usual and indeed good management of a dairy herd and that it was known to the Robinsons that Mr Luck was using this process. Mr Gleeson said that of the six springer calves one was a first calf heifer, that is, a young cow about to have its first calf but the others had all previously calved. The six springer cows were marked with a blue tail tag and Mr Gleeson says Dale Robinson was told about that in a phone call with him.
- Mr Gleeson said that Mr Robinson rang him after about mid-April 2009 and complained of poor milk production. Mr Gleeson says this was the first such complaint and was not a complaint about the quality of the cows, but about milk production. In response Mr Gleeson said he arranged to visit the Robinsons’ property. When he arrived he observed there was not suitable feed in the paddocks and he told the Robinsons, he said, that they needed to get feed for the cattle. I interpose that this is not inconsistent with the evidence of Dale Robinson that I have earlier referred to about problems with water supply at about this time, and the fact that SunWater soon after cut off water for irrigation purposes. It is also consistent with evidence of Rachael Parkes to which I will shortly refer. Mr Gleeson said he also told Mr Robinson that he knew a consultant, Chris Sadlier, who might be able to help. Mr Robinson, he said, agreed to this. Some days later Mr Gleeson said he returned with Mr Sadlier. In his presence he said Mr Sadlier told Mr Robinson that the cows were hungry and that they needed to find out what the previous owner had been feeding them, and start them on that feed. Mr Gleeson said that Mr Robinson told Mr Sadlier that the cows were not drinking their water. He said that Mr Sadlier told them that if cows won’t drink water they had “no chance of getting milk”.
- Subsequently the Robinsons engaged Mr Gleeson to sell the cattle they had purchased from Mr Luck. They determined to do so by an auction to be held on 24 July 2009. Six of the cows had died by then. A catalogue was prepared for the sale of the remaining 84 cows. Two days before the sale Mr Gleeson said he was rung by Mr Robinson who told him the cows had already been sold. As a consequence the auction was cancelled.
- I find that the cause of the inability of the plaintiffs to produce milk in the quantities that Mr Luck had achieved, and which they hoped for, was directly related to their management of the herd. The evidence of Rachael Parkes assists me greatly in that regard. She and her husband run a large commercial dairy of 650 cows, mostly Holstein Friesians. She said they produce between 28L and 30L of milk per cow per day, amounting to over 3.5 M litres annually. It is an intensive farm, resembling a feedlot, with high capital inputs but high gross returns. After school Mrs Parkes completed a three year traineeship with Moxey Farms in Richmond, NSW. She described Moxey Farms as an industry leader. After completing that traineeship she worked for a number of farms on the Darling Downs, progressing to the position of herd manager for a family owned farm. In 2009 she and her husband purchased their own farm.
- They commenced the farm at about the time they purchased the 84 cows and the milk supply contract from the plaintiffs. Her farm was not however then a feedlot farm. She said in evidence that she and her husband needed to obtain a milk supply contract and that a farm services officer for Dairy Farmers Milk Cooperative Ltd, Mr Maroski, had told them to contact the plaintiffs as he thought their contract might be available for purchase. She said that at the same time as they purchased the cows and milk supply contract from the Robinsons, they also purchased 130 Holstein cows. They used those Holstein cows to supply milk to Dairy Farmers pursuant to the supply contract that they acquired from the plaintiffs.
- Ms Parkes said that the 84 cattle she purchased from the plaintiff were in poor condition. She said many, about two-thirds to three-quarters, were in calf. Over a period of some months she improved the condition of the cows and after they had calved, sold them. She said that she had brought them to get the supply contract and not to milk. She said the cows averaged a sale price of $1,600 when sold. She said that when she purchased them she believed they were valued at about $600 each. This estimate is generally consistent with the evidence of Mr Cochrane, whose evidence I have previously referred to, but also that of Mr Gleeson and with that of Dale Robinson as to what he had been told of their worth.
- How was this dramatic change in the value of the cows achieved? Mrs Parkes, who I found an impressive witness, said that by giving the cows appropriate feed and water she was able to have them increase their weight by an average of about 150kg. She described them, at the time she saw them at the plaintiff’s farm, as in poor condition. That evidence about the increase in weight of the cows when in her care was consistent with the evidence of Mr Gleeson that he felt that when he saw the cows at the Robinson farm prior to the proposed auction of 24 July 2009 that they had lost, by his estimation, 200kg after leaving Mr Luck’s property.
- The plaintiffs’ solicitors wrote to Mrs Parkes on the 12 June 2013 (Exhibit 15) enquiring inter alia, about the state of the herd that she had purchased in July 2009 and of her impression and observations of the dairy operation conducted by the plaintiffs. Her reply of the 17 September 2013 (Exhibit 16) was very critical. She said that she had purchased the cows to obtain the milk contract. She said the cattle were in poor condition and were giving virtually no milk as a result of poor management. She described how she dried them off, fed them and only commenced milking them after they had calved. She described the plaintiff’s farm as “derelict”, saying the paddocks were “weed infested” and that the cows had not been milked when she arrived to inspect them at 8:00am. She said;
“It’s obvious the lack of herd and nutrition management caused the failure of this business. The genetic potential of the modern dairy cow is such that almost all cows are capable of high milk production provided they are managed correctly. As a dairy farmer with over ten years’ experience I am appalled that the Robinson’s allowed their cattle and their farm to deteriorate to such a state and it is beyond me why on earth they thought of trying to become dairy farmers.”
- She was criticised severely by counsel for the plaintiffs in his cross-examination of her. It was suggested that she had been “got at” by Mr Gleeson, and that it was he who had suggested what she should say in that letter. I might say I formed the impression Mrs Parkes was not the sort of women who could be easily “got at”. She said, very directly, that she was asked for an opinion and gave it. I also note she said that while she had purchased cattle through Mr Gleeson, she had never used him as her broker to sell cattle on her behalf.
- Despite the criticism of her by the plaintiff’s counsel, I found that her comments were a reflection of what she observed when she visited the farm on two occasions – the first to view the cattle and then to supervise their loading on the day they were transported to her farm. Ultimately, her observation of the plaintiffs’ farm is not the critical observation. What is critical is her observation of the condition of the cattle when in her care. She came to know them well I have referred already to her observation of their condition when she purchased them. I accept what she said about their condition then, and of their very significant improvement under her care.
- Her observations of the farm are incidental to that primary observation, but in my view explain the condition of the cattle. I note also that it was not entirely inconsistent with Dale Robinson’s own evidence about the effect of the change in water supply resulting from SunWater decision to preclude use of the usual allocation of water for irrigation in 2009.
- Evidence was given at the trial of numerous factors which can adversely affect the milk production of a dairy herd. Transport of the herd from Mr Luck’s property to that of the Robinsons could have had such an effect. If they were not given access to good food and water immediately after arrival at the farm that could cause problems. If they were not milked on the first afternoon, or milked later than usual, this could cause difficulties. The change from Mr Luck’s walk through diary to the herringbone dairy of the Robinsons could cause difficulties. These and problems with the quantity and quality of food or nature of the available drinking water are all factors which could cause a cow to go dry. There are numerous such factors. Mr Luck said in effect that he knew all the cows like family, calling them by name. A change to a new environment was, in such circumstances, likely to cause dislocation. It is not important that I make a finding as to what precisely caused the significant diminution in milk production of the herd. I do find however that after the cows were moved from Mr Luck’s property to the Robinsons that their milk production declined very significantly.
- At the Robinsons’ farm the herd produced significantly less than they had hoped. Mr Luck said he told Dale Robinson that he expected his herd – which he said was about 110 cows – would, after all had calved, provide about 1600L per pickup on his place. This conversation occurred, he thought, on the occasion of the signing of the contract on 20 November 2008. I accept he said words to that effect. I also accept that his herd did achieve that level of production. The plaintiff’s bundle of documents (Exhibit 2) contains a summary of Mr Luck’s milk supply to Parmalat. In January 2009 he averaged 1542L per pickup and in February averaged 1658L per pickup. I do not however find that it was a term of the contract that they did so, either at his place or more particularly at the Robinsons. I also do not find that Mr Gleeson told the Robinsons that he would guarantee the herd would produce 1600L per pickup at the Robinsons’ farm as the plaintiffs allege. To do so would have ignored the obvious reality that the volume of milk that the herd might produce was significantly dependant on the Robinsons’ own animal husbandry and farm management, a point recognised in their own evidence.
- I was impressed by the evidence of Mr Gleeson – despite his unfortunate tendency to speak over me when I was asking him a question. He appeared to me to have a good recall of events and gave a coherent and rational explanation of what had occurred.
- Mr Luck’s evidence was less precise and less reliable but he was nevertheless, I find, an honest witness. I generally accept his evidence but some of the detail he gave may be wrong. I accept however a number of critical elements in his evidence. I accept that on the first visit he met the Robinsons and Mr Gleeson at the point he marked on Exhibit 17, being the southeast corner of what he called the day paddock, off Sippel Road. I reject the evidence of both Dale Robinson and Mr Robinson that he kept them waiting, then left almost immediately after he arrived.
- I accept that the dairy herd was all within the day paddock, where the Robinsons carried out there inspection, and that Dale Robinson spent about an hour in that paddock with Mr Luck inspecting the herd. I accept that Mr Robinson was with them for only a relatively short period of time before returning to the area where the cars were parked, where he joined Mr Gleeson and Mrs Robinson. I do not accept the evidence of the Robinsons about the inspection or that they saw only dry cows. If they did see only dry cows in a paddock I find it was prior to meeting Mr Luck at the corner of the day paddock, as I have described, and must have been in the paddock on the southeast corner of his property between Sippel Road and Blenheim Road in a paddock where Mr Luck kept dry cows and heifers. I find they did not view those cattle with Mr Luck.
- The dairy cows inspected in the day paddock by Mr Luck and Dale Robinson and, as I have said, for a short time by Mr Robinson, were cows which comprised the herd from which the 90 cows purchased by the Robinsons came. I accept that in that period of about one hour Dale Robinson saw the majority of the dairy herd and so knew exactly what they was purchasing. In circumstances where a significant number had horns – the photos at pages 169 to 182 of Exhibit 2 show approximately 15 with horns – I reject the plaintiffs’ contention that it was a term of the agreement that cattle they purchased from Mr Luck had no horns.
- I accept Mr Luck’s evidence, and that of Mr Gleeson, that when the contract to purchase the 90 cattle was signed the handwritten parts thereof had been completed. I find Mr Luck was wrong to say that the PIC number of the Robinsons’ farm had been included in Schedule 2 of the form and accept Mr Gleeson’s evidence that it was not. I find the contract was otherwise complete, as Mr Luck and Mr Gleeson both said, and reject entirely the Robinsons’ evidence that Dale Robinson and Mr Luck both signed a blank form.
- I also reject the assertion that it was a term of the agreement that all cattle be lactating at the time of delivery. I accept however that the vast majority of the herd were lactating cattle at the time of delivery – consistent with the milk delivery records of Mr Luck and Mr Luck’s evidence as to how he selected the 90 cows from his herd that he provided to the Robinsons, which I also accept. The evidence disclosed that at any one time about 10% of cows in a herd might not be lactating because they were in calf and approaching the last six weeks of calving. At this time cows are traditionally “dried off”, as I have earlier explained, to enable them to regain strength to more efficiently cope with the trauma of calving. I accept the evidence of Mr Luck that generally he sent cows to the Robinsons that were in fact lactating. In the second delivery, six cows were marked with blue tags and were described as “springer” cows, that is, cows approaching calving. It may be that some, or indeed all, of those six cows may not have been producing milk at the time of delivery. In my view that does not amount to a breach of the contract and, as I have said, I do not accept that it was a term of the contract that only lactating cattle be provided. Indeed, I do not find that the term “lactating” was one that was used in conversation between the Robinsons, on the one hand, and Mr Luck or Mr Gleeson, on the other. The Robinsons inspected the herd and bought what they had inspected. Mr Luck then sorted the cows so that the Robinsons received what they had contracted to buy.
- I also do not accept that the Robinsons specifically relied upon the advice of Mr Gleeson that they should acquire Illawarra cows. I accept Mr Gleeson’s evidence that Mr Robinson asked him if he had Illawarra cows on his books, and accept the evidence of Mr Gleeson that Mr Robinson said this was because he already had some such cows and a bull and wished to build on that herd.
- In paragraph 10 of the plaintiffs’ pleadings it is alleged that the second defendant represented to the Robinsons a number of things. I have already indicated that I have rejected the assertion that they required “lactating cattle”. I have indicated that I have also rejected that it was represented that the 90 cattle the Robinsons purchased “would” produce 1,600L per pickup. I accept that Mr Luck said that the cows would, after they all calved, produce 1,600L per pickup, as I have previously indicated, but that this was confined to their production on his farm and not a representation as to what they might produce on the Robinsons’ farm. It was a figure in fact produced on his farm in 2009. It was also alleged in the pleadings that the second defendant had represented that “all the cattle were stud cows and registered”. Evidence was not given by either Mr Robinson or by Dale Robinson of any representation to that effect and, in any case, I do not find that such a representation was made. I do note, however, that many of the cows were registered with the Illawarra Breeders Association, consistent with the evidence of Mr Luck to that effect.
- I do not accept that the written contract did not reflect the terms of the agreement. The agreement was to purchase 90 red cows from the herd of 110 cows owned by Mr Luck and that the Robinsons indicated they were prepared to allow Mr Luck to determine the makeup of those 90 cows. I accept Mr Luck’s evidence about how he did so and that, in general, better quality and/or younger cows were provided by him to the Robinsons.
- I also reject the assertion that the delay in delivery of the cows till March 2009 was because of any request by Mr Luck or that delivery in March 2009 was a breach of the contract. I accept that it was the Robinsons who requested that the delivery of the cows be delayed in order to enable them to complete the dairy that they had been refurbishing on their property.
- In the circumstances, the plaintiffs’ claim must fail.
- I might also indicate that in the event that my conclusion about that was incorrect, that I would not accept the assessment of damages made on the plaintiffs’ behalf by Mr Maynes. This is not a criticism of Mr Maynes’ approach or mathematics but, in my view, the damages claimed, even if some damages were recoverable, do not reflect the loss which would have accrued if the plaintiffs had mitigated their loss. It is clear that the plaintiffs have continued to borrow further sums to finance their operation. I have no doubt that life has not been easy for them but, in my view, if a quantity of the cows did not comply with the contract description, they ought have disposed of those cows – realising a figure of, say, $500 per cow – and used those proceeds and further borrowed monies to have purchased an equivalent number of productive cows. That could have been achieved at a probable cost of about $1,300 per head. The loss, therefore, would have been $800 per cow. If even half of the cows had not complied with the description, this would amount to a loss of about $36,000, together with some sum for loss of production in the interim period.
- In my view, a loss significantly less than $100,000 would have in such circumstances been appropriate compensation but it is really impossible to calculate the loss because, as I have found, the cows that were delivered to the Robinsons were the cows they had purchased and the decline in production was due to cows stopping lactating and going dry, caused by the Robinsons’ own mismanagement. In such circumstances it is impossible to ascertain what number of cows might have not complied with the contract and so been required to be sold. The point that I am making is that the claimed loss bears almost no resemblance to any loss that might have resulted if Mr Luck had not complied with his obligation to provide cows in accordance with the contract but the Robinsons had mitigated their losses.
- There will be judgment for the defendants. I will hear argument as to costs.
- Published Case Name:
Robinson & Ors v Dairy Brokers Australia Pty Ltd & Ors
- Shortened Case Name:
Robinson v Dairy Brokers Australia Pty Ltd
 QDC 148
25 May 2016
|Event||Citation or File||Date||Notes|
|Primary Judgment|| QDC 148||25 May 2016||Judgment for the defendants on the plaintiff's claim for damages for alleged misleading or deceptive conduct pursuant to s 52 of the Trade Practices Act 1974 (Cth): Reid DCJ.|
|Notice of Appeal Filed||File Number: Appeal 6153/16||22 Jun 2016||-|
|Appeal Discontinued (QCA)||File Number: Appeal 6153/16||18 Aug 2016||Appeal dismissed by consent.|