DISTRICT COURT OF QUEENSLAND
CITATION:
Porter Equipment Australia Pty Ltd v Barton Ventures Pty Ltd [2017] QDC 299
PARTIES:
PORTER EQUIPMENT AUSTRALIA PTY LTD
(First Applicant)
and
SUREBET TRUCK SALES PTY LTD
(Second Applicant)
v
BARTON VENTURES PTY LTD
(First Respondent)
and
TONY DI CARLO
(Second Respondent)
FILE NO/S:
D4356/2017
DIVISION:
PROCEEDING:
Originating Application
ORIGINATING COURT:
District Court at Brisbane
DELIVERED ON:
11 December 2017
DELIVERED AT:
Brisbane
HEARING DATE:
30 November 2017
JUDGE:
McGill SC DCJ
ORDER:
(Orders and declarations as per draft)
CATCHWORDS:
PERSONAL PROPERTY – Title – sale of goods – whether title passed to purchaser – delivery without payment of price – recovery of goods.
Sale of Goods Act 1896 s 20(1).
Personal Property Securities Act 2009 (Cth) s 123.
BAQ Credit Pty Ltd v Chatah [2017] NSWSC 1444 – followed.
Minister for Supply and Development v Servicemen’s Co-Operative Joinery Manufacturers Ltd (1951) 82 CLR 621 – cited.
Orix Australia Corp Ltd v Peter Donnelly Automotive Pty Ltd [2007] NSWSC 977 – followed.
Ward Ltd v Bignall [1967] 1 QB 534 – cited.COUNSEL:
A Symenovych (solicitor) for the applicants, and as unpaid agent for the first respondent.
There was no appearance for the second respondent.
SOLICITORS:
JHK Legal for the applicants.
The respondents were not represented.
By this proceeding the first applicant sought to recover from the second respondent possession of a loader, on the basis that the loader is the property of the first applicant and it has come into the possession of the second respondent who is refusing to return it to the first applicant. The loader is located on land owned by the first respondent, previously leased by it to a company, Tyremil Pty Ltd with which the second respondent was associated. Tyremil Pty Ltd is now in liquidation, and the liquidator has disclaimed the lease, but it appears the second respondent remains in possession of the property. On 30 November 2017 I made a declaration that the first applicant is entitled to possession of the loader, and an order that the second respondent return it, and that the first applicant is entitled to seize it. I said I would give reasons for that order later. These are the reasons.
Background
The history of the matter on the basis of the affidavit evidence before me is that the first applicant in June last year had for sale a loader of a certain description. The second respondent spoke to a salesman employed by the first applicant, and there was an oral agreement made between them, for the sale of the loader to Tyremil Pty Ltd for $60,000, payable on delivery or within five days after that company was advised that the loader was ready for delivery, whichever was the earlier.[1] On the same day a contract for the sale and purchase of the loader was provided to that company, for execution by it. The document identified the customer details as “Tony Di Carlo, Tyremil Pty Ltd” followed by three different addresses in Queensland, and continued “I/we offer to purchase” the loader for a particular price plus GST. The offer was to be subject to the terms and conditions of the document, and immediately above the place for the customer and others to sign was the statement:
“This equipment sale agreement is not binding on the Porter Group unless signed by both the salesperson and an authorised representative of the Porter Group.”
[1]Affidavit of Luoni filed 14 November 2017, para 4, 5. Other facts are generally from this affidavit.
Relevantly, for present purposes, the terms and conditions of sale included clause 11 which provided that title in the equipment would pass to the customer once the price has been paid in full and the applicant had received clear title to any trade-in. There was in this case in fact no trade-in. It went on to provide that “if the equipment was transported to the customer before payment is made… the customer shall have possession of the equipment as bailee only, even if the customer has a credit account with the company…” The agreement was never signed by or on behalf of the second respondent, or Tyremil Pty Ltd.
The same day the second respondent is said to have told the salesman words to the effect of “we are happy with the agreement and we will arrange finance shortly”. On 1 July 2016 the salesman sent to the second respondent an email asking him to read and sign certain enclosed forms so that they could complete the deal. Enclosed with that email was a letter which relevantly stated:
“Porter Equipment Australia Pty Ltd offer as per our sales agreement terms and conditions… which have been provided to you by post and email, if you agree to take this unit into your possession [a used loader] at the discounted rate of $54,545.45 plus GST, you hereby accept our terms and conditions of sale (referred to in sales agreement…) …”
There was provision for a representative of Tyremil Group Pty Ltd or Tyremil Pty Ltd to sign. There was a separate document referring to an obligation to pay rent on a different loader which had been provided in the interim until the loader, the subject of the sale, was delivered, there was a tax invoice in respect of the sale, and a further copy of the form of contract for sale and purchase of the loader. None of these documents was in fact signed and returned by the second respondent, or anyone else.
On about 15 July 2016, the first applicant delivered the loader to the place of business of Tyremil Pty Ltd, the property owned by the first respondent. There is nothing in the evidence about any relevant conversation having occurred or document having been provided at or about the time of the delivery. On or about 27 July 2016, the first applicant registered its security interest in the loader on the personal property securities register. On 6 October 2017, Tyremil Pty Ltd was put into liquidation. The price for the loader has never been paid, but the loader remains in the possession of the second respondent. An attempt was made on 10 October 2017 to recover the loader, but this was prevented by the aggressive manner of the second respondent. Hence this application.
The proceeding
The application was originally brought only against the first respondent, the owner of the premises, but since the first respondent is not in fact in control of the premises, it is not the first respondent who is opposing the recovery of the loader. The second respondent was then joined, and the proceeding adjourned so that arrangements could be made for him to be served in accordance with an order for substituted service made by the Judge who made the order of joinder. The requirements of those directions were complied with, but the second respondent did not appear when the matter came before me on 28 November 2017. On that occasion I was concerned by the fact that the contract to purchase had not been signed, and that it was expressed to be subject to acceptance on behalf of the first applicant which on its face had not occurred. The matter was adjourned to enable the solicitor for the first applicant to obtain further instructions, and some further information was provided as a result.
Analysis
The first applicant’s case is simply that it was the owner of the loader and property in the loader never passed to Tyremil Pty Ltd, because the purchase price was never paid, so it remains the owner of the loader and is therefore entitled to possession as against whoever is currently in possession of it, in fact the second respondent. That is correct, so long as the first applicant retains ownership of the loader. My concern was whether there had been an agreement to sell the loader under which property had already passed notwithstanding that the loader had not been paid for.
When there is a contract for sale of specific or ascertained goods, such as the present where the contract is for sale of a specific loader, property in them is transferred to the buyer at such time as the parties to the contract intend it to be transferred: Sale of Goods Act 1896, s 20(1). The intention is to be ascertained having regard to the terms of the contract, the conduct of the parties and the circumstances of the case: s 20(2). By s 21, unless a different intention appears, certain rules apply for ascertaining the intention of the parties as to the time at which property in the goods is to pass to the buyer. The first rule is:
“When there is an unconditional contract for the sale of specific goods in a deliverable state, the property in the goods passes to the buyer when the contract is made, and it is immaterial whether the time of payment or the time of delivery, or both, is or are postponed.”
In the present case, there was an oral agreement for the sale of the goods, and subsequently the vendor presented to the purchaser a draft written contract for the sale of the goods. That contract was not in the form of an offer capable of immediate acceptance: because of its form, and the fact that it was forwarded unexecuted by the vendor, but made subject to execution in a particular way on behalf of the vendor, the mere execution of that document on behalf of the purchaser and communication of that acceptance would not bring into existence a contract between the parties; it would merely be an offer by the purchaser to purchase the loader on the terms of that contract. No doubt that would then have been accepted by the vendor, but a written contract in the form of the contract for the sale of the loader never came into existence.
Further, the less formal contract in the form of the letter by which the purchaser would have agreed to the terms of the formal contract by taking delivery of the loader was never signed on behalf of the purchaser. Nevertheless, it does seem to me that in the present case there was a contract for the sale of the loader from the first applicant to Tyremil Pty Ltd. There was the initial oral contract, and there was then on 1 July 2016 an offer to sell on terms of the written contract capable of acceptance by Tyremil Pty Ltd by accepting delivery of the loader. Subsequently Tyremil Pty Ltd did accept delivery of the loader. The first applicant submitted that the effect of that was that a contract came into existence which incorporated the terms of the written agreement.
Ordinarily mere silence or acquiescence cannot amount to acceptance of an offer. If an offer is made, coupled with the statement to the effect that, “unless I hear to the contrary I will take it that this offer has been accepted by you,” mere silence will not amount to acceptance. On the other hand, there is no doubt that an offer may be accepted by conduct. Depending on the circumstances it may be possible to deliver something to someone without any particular co-operation on the part of the recipient, but this was a substantial piece of equipment which required transportation on a low-loader, and in the circumstances I am prepared to assume that the process of delivery to Tyremil Pty Ltd required some form of active co-operation on the part of that company by way of acceptance of delivery. In those circumstances, this amounted to acceptance by Tyremil Pty Ltd of the offer in the email of 1 July 2016, even though the short form of written agreement had not been signed on behalf of Tyremil Pty Ltd and returned.
That an offer may be accepted by conduct is shown by the decision in Orix Australia Corp Ltd v Peter Donnelly Automotive Pty Ltd [2007] NSWSC 977 where a dealer in motor vehicles made an offer to supply a particular vehicle which was not expressly accepted, but a representative of the offeree attended at the supplier’s premises and took delivery of the vehicle, and this was characterized as acceptance of the offer by conduct: [22]-[24]. In that case as well, a question arose as to whether title had passed in these circumstances. In that case the document which was characterized as the offer, which, it was held, had been accepted by conduct, contained a stipulation that the sale was on terms of “cash on delivery”: [29].
Reference was made to the rule in the New South Wales equivalent of the Queensland Sale of Goods Act, and statements of principle in Ward Ltd v Bignall [1967] 1 QB 534 at 545, Minister for Supply and Development v Servicemen’s Co-Operative Joinery Manufacturers Ltd (1951) 82 CLR 621 at 640, and a passage in Professor Sutton’s text “Sales and Consumer Law” (4th Edition 1995) at [14.9]. The stipulation for cash on delivery was held in that case to amount to a retention of title clause so as to prevent title to the vehicle passing on delivery without payment of the price.
In the present case there was an equivalent stipulation in the oral agreement, for payment on or before delivery, which prevented title passing until the price was paid, if that remained the operative contract. If the offer of 1 July 2016 was accepted by conduct by the purchaser, that incorporated the express term in the formal contract for the retention of title by the vendor until the price was paid. In either case, if there was a contract in those terms the effect was that property did not pass on the making of the agreement, but only when payment of the purchase price was made.
Even if I am wrong about this, and in the circumstances the unresponsiveness of the purchaser company meant that there was no identifiable contract for the sale and purchase of the loader entered into, the various communications from the first applicant consistently indicated that the first applicant was prepared to trade only on terms which were inconsistent with the notion that property passed in accordance with rule 1. The consistent position of the first applicant was that property would not pass until payment, and in those circumstances, in my opinion, the delivery of the loader to the purchaser company, though passing possession to that company, did not pass property in the loader. Hence the first applicant remains the owner of the loader.
The first applicant is therefore entitled to recover possession of the loader from the second respondent, who has no proprietary interest in the loader and no right to possession of it. The only other potential claimant to possession would be the liquidator of the company, and the evidence shows that in fact the liquidator has been attempting to assist the first applicant to recover possession of the loader. Apart from the first applicant’s entitlement on the basis of its right of property in the loader, under the Personal Property Securities Act 2009 (Cth), s 123, the first applicant is entitled to seize the loader on the basis that the company is in default under the security agreement constituted by the retention of title clause in the contract.
I note that in BAQ Credit Pty Ltd v Chatah [2017] NSWSC 1444, orders were made against a person in possession of a chattel who was in breach of a similar credit contract giving security over a vehicle. I have taken account of the orders her Honour made in that case, along with the Civil Proceedings Act 2011, s 80 and 81 in formulating the order that I made. Accordingly, for these reasons, I made orders in terms of the draft that I signed on 30 November 2017.