Australian Liquor Marketers Pty Ltd v Drop Ship Trading Pty Ltd

Category: Principal judgment

Parties: Australian Liquor Marketers Pty Ltd (Plaintiff/Cross-Defendant)
Drop Ship Trading Pty Ltd (First Defendant)
Christian Tayler (Second Defendant/Cross-Claimant)

Representation: Counsel:
J Pearson (Plaintiff/Cross-Defendant)
C Taylor (Self-Represented) (First and Second Defendants/Cross-Claimant)
Solicitors:
Aston Reid Lawyers (Plaintiff)

File Number(s): 2024/197253

Publication restriction: Nil

JUDGMENT; ex tempore (REVISED)

1. By a statement of claim filed on 28 May 2024, the Plaintiff, who is a wholesaler of liquor, sues the Defendants, the first being a corporation, that was itself, a wholesaler of liquor, and the second being, Mr Christian Taylor, who was, is and has been, at all relevant times, a director of the first Defendant, who executed a guarantee, guaranteeing the liabilities of the first Defendant to the Plaintiff pursuant to a credit agreement.

2. The claim in this case by the Plaintiff is for goods sold and delivered pursuant to a number of invoices totally $186,336.57. Mr Taylor is said to be also liable for that amount as a consequence of the guarantee.

3. Mr Taylor has appeared on his own behalf, and with my leave, on behalf of the first Defendant corporation, and has presented the case, if I may say so, in a reasonably clear and coherent, and certainly a very sensible and measured way.

4. Mr Pearson, of counsel, has appeared for the Plaintiff. He also has had regard to the sensitivities and difficulties involved in running a case against a person acting for themselves, who is not schooled in the legal system and the rules of evidence, and has done so, I think, very fairly.

5. There is no issue between the parties that, firstly, the first Defendant did enter into, and there was in force, a valid credit arrangement whereby the Plaintiff would supply to the first Defendant on credit, liquor, as and when ordered, up to a certain limit.

6. There is also no issue, but that Mr Taylor executed a guarantee for the liabilities of the first Defendant under that credit arrangement and will be liable for any amounts found to be due by the first Defendant to the Plaintiff, and he will be liable jointly and severally with the first Defendant.

7. There is no issue but that the various supplies of liquor and other related products, for which the Plaintiff sues, were all the subject of orders placed by the first Defendant with the Plaintiff for those goods.

8. What is in issue, is that Mr Taylor contends that those orders were cancelled by him, or on his behalf, or more directly, that none of the liquor the subject of the outstanding invoices, was actually collected by the first Defendant as is alleged by the Plaintiff.

9. As this is a case for goods sold and delivered, the critical issue that divides the parties, is whether the goods, the subject of the disputed invoices, were in fact delivered in the sense of collected by or on behalf of the first Defendant.

10. The Plaintiff relies on a chain of business records relating to each contested delivery, which, Mr Pearson contends, are all entirely consistent with, not just the orders being placed, but them then being processed and collected on behalf of the first Defendant. I will not go in detail through those documents. There is a set of documents for each claimed invoice. The chain is as follows; firstly, there is a printout from what is described as the computer portal of the Plaintiff, which was the internet site by which people could place orders with the Plaintiff. That portal records of a history of the various orders being placed by the Plaintiff. The second document is an invoice which is produced by the Plaintiff prior to the goods being collected, so that the invoice is available to be handed over upon collection and delivery, and the third is, what is described as a "driver's delivery run sheet" which, as the title suggests, is a document that was created for use by delivery drivers when delivering goods. On the evidence, that document was also used as a way of recording a receipt of the goods by a person collecting them from the Plaintiff's delivery dock.

11. In relation to each of the outstanding invoices, there is an example of each of those documents. In relation to the driver's delivery run sheet, there appears a signature confirming collection by reference to invoice numbers on particular days. The evidence as to how that information got onto the run sheet was that it was prepared from the information in the Plaintiff's computer system, other than the date of collection and the registration number of the vehicle, by which it was collected, and the signature of the person accepting the delivery. Each of the documents has a registration number written into it and a squiggled signature. The registration number equates with a vehicle that was, at least in accordance with the records of the hire car company, Europcar, rented to the first Defendant at the time of the particular deliveries, although Mr Taylor has given evidence that that was an error by Europcar, and in fact, the relevant car had only been rented by his company for a very short period of time.

12. The defence turns almost entirely on an acceptance of Mr Taylor's sworn evidence, to the effect that, he cancelled the various orders and that the delivery consequently did not occur. There is only one matter which Mr Taylor points to as objective, corroborative evidence and that is an order he placed with another supplier of champagne, Kollaras (Exhibit B). Mr Taylor says that this confirms that he had cancelled the order for champagne with the Plaintiff. However, that evidence is no more than a pro-forma invoice and there is no evidence that it was ever paid. I do not consider it to be evidence that replacement champagne was, in fact, ordered.

13. I should say at the outset, my assessment of Mr Taylor as a witness is that he is honestly doing his best to tell me what he thinks occurred during this very busy and stressful time, that he and his business were undergoing.

14. The reason the time was very busy and stressful, is that the business had, only shortly prior to 2023, commenced operation and as so often happens with new businesses was, I think, doing much better in terms of volume than had been expected by Mr Taylor. Mr Taylor, who no doubt, is a good salesman and negotiator for the purpose of being a middleman for buying and selling alcohol, it is quite clear to me, was not particularly adept at keeping on top of the paperwork involved with managing such a business.

15. What that means is, that I am satisfied that during the relevant period, Mr Taylor found himself somewhat overwhelmed with the paperwork in terms of outstanding invoices and the like and was having great difficulty and was becoming frustrated in being chased up for various payments by the Plaintiff.

16. As well as that, he also found himself in a position where he was not writing any contemporaneous-type documents that one might expect a more experienced, or perhaps less stressed, businessperson to write at the time. What all that means is, that his evidence really boils down to his uncorroborated assertion that he cancelled various orders by pressing the relevant command in the portal and that he had a series of discussions with various people within the Plaintiff's organisation, where he told them that he did not want to pay some of these invoices because they had not been collected and had been cancelled.

17. The difficulty for Mr Taylor in relation to that aspect of his evidence, is that unless there was some sort of deliberate fraud or dishonesty going on, one would have expected, firstly, those cancellations, and there were at least three of them, to have been properly received by the Plaintiff's computer portal system. Secondly, that system also had the ability for people, within the Plaintiff organisation, to make a note of telephone and other conversations they were having with customers, and there are no such notes, and thirdly, the people at the delivery dock, again leaving aside deliberate fraud, which I am satisfied, having heard from some of those people, did not occur, had to have made a series of pretty basic and unlikely mistakes when filling out the delivery run sheets.

18. All of those documents are business records for the purpose of the Evidence Act 1995 (NSW) and are therefore evidence of the representations contained within them. That does not mean that they are conclusive evidence. They, of course, are simply considered as evidence to be weighed in the balance with all the evidence. However, they are business records, which means I am satisfied that they were made contemporaneously as things happened, at a point in time when people did not know that they were being prepared to be used in a court case. True it is, that experience teaches one that people make mistakes when filling out documents in the normal run of business. There is no doubt about that. However, on the other hand, the reason the law, as a matter of evidence, has long given weight to such documents is, firstly, they are contemporaneous, which means they are less likely to contain mistakes and are less likely to have been concocted with a view to dealing with some dispute but, secondly, are usually created a time before anyone even has an understanding that there was to be a dispute, and for all those reasons, I consider them, in this case, to be reliable and to be deserving of some weight.

19. If I can then turn to the three dates of delivery, which are in dispute, which should bring focus on the issues raised by the Defendant in answer to the Plaintiff's claim. The first is, a collection on 1 December 2023, which produces invoice number 83977 in an amount of $69,182.66.

20. Mr Taylor's answer to that claim is that the order was cancelled by him by manipulating the Plaintiff's computer portal. As I have said, if he did that, it did not register with the computer portal, and I therefore think, it unlikely that he did so. Mr Taylor accepts there was then a collection at the Plaintiff's warehouse where on the day other items were collected, but that Mr Taylor says the liquor, the subject of this invoice, was rejected, and he then rang a series of people within the Plaintiff's organisation to confirm that. He then says he ordered replacement champagne from Kollaras. However, as I have said, that order, which produced a pro-forma invoice only, has not been proved to have been completed.

21. The rejection of the delivery at the warehouse, is not consistent with the run sheet prepared at the time and signed by Mr Taylor himself. His explanation for that is that he either did not notice for which order he was signing or he suspects that the entry has been added later. I accept that he has that suspicion, but as I sought to explain to him during the course of submissions, that sort of submission is one thing, but it is a far cry from evidence that would allow such a finding, and I do not accept that anyone has deliberately manipulated the records on the run sheet after Mr Taylor signed it.

22. What that means is, that there is objective evidence that on the day Mr Taylor accepted that the goods, the subject of the disputed invoice, had in fact been collected and that he, in effect, signed a receipt to that effect.

23. The next relevant matter that needs to be considered, is that on 18 December, the Plaintiff sent the first Defendant, and it came to Mr Taylor's attention, that the invoice was outstanding and that it was overdue. Mr Taylor responded and said that he would pay the $69,182.66 "tomorrow".

24. He also said in that email that another invoice that had been chased up in the same email, had been paid on that day. This was true and makes me comfortably satisfied that, at the time Mr Taylor wrote the email, he understood which invoices were being talked about and that if it be the case that he had sought to cancel that order on the computer system, and had rejected picking up the goods at the warehouse, I still do not understand, even though I invited Mr Taylor to explain to me why he did not come forward then, and say something like, "I paid you the $31,000 yesterday, but about the $69,000, as you know, there is a dispute…" He did not do that and so that is again a piece of contemporaneous objective evidence of conduct by Mr Taylor and the first Defendant, which are inconsistent with the order having been cancelled and the goods rejected.

25. Again, on 28 December, the $69,000 invoice was chased up in an email and again, Mr Taylor responded, firstly by admonishing the Plaintiff for chasing bills over the busy public holiday period, but secondly, saying that he would pay then, referring to a series of alleged outstanding invoices, including the $69,000, “tomorrow”.

26. When I balance on the one hand Mr Taylor's evidence which is of his memory of events, but through the prism of what I am satisfied was a very stressful busy and confusing time for him, against the evidence tendered by the Plaintiff which comprises the business records to which I have referred, and add to that, the various promises by Mr Taylor to pay these disputed invoices, I am satisfied on the balance of probabilities, that the goods were not only ordered, but were delivered in the sense of collected by the first Defendant from the Plaintiff on 1 December 2023, which means that the invoice $69,182.66 is due and remains due and payable.

27. The second delivery date that is relevant, is 6 December, and Mr Taylor's answer to this is that, firstly, an order for the particular liquor was placed. Secondly, he saw the invoice, or a pro-forma of the invoice, early on in the piece and formed the view that it had been charged to the wrong account. That is, it should have been charged to the Wine Equalisation Tax (“WET”) exempt account, but it had in fact been charged to the WET account. It seems upon analysis, that Mr Taylor had that wrong, but it is clear from the dealings he had at the time, that he did have a concern at the time about whether it had been charged to the right or wrong account.

28. He then had series of text and other communications with a Steve Bickerstaff, of the Plaintiff, where this issue was sought to be clarified, in the course of which, he said to Mr Bickerstaff that he was "desperate for the stock and it's 25 cases of D**om for which a customer is 'hanging for'". Mr Bickerstaff then sent Mr Taylor a text which said that the Dom Pérignon would be available to pick up on Wednesday (which would have been 6 December). He sent that text on 4 December, and it seems that almost contemporaneously with that text being sent, Mr Taylor, on behalf of the first Defendant, then placed another order, and an invoice was generated on 5 December. Again, there is no record of the order being cancelled. Again, there is an email on 28 December in response to the Plaintiff chasing payment for that invoice, saying it would be paid tomorrow and not indicating that there was any dispute in place.

29. Finally, there is the question of whether the Europcar, which licence plate appears on the run sheet, was actually hired by the first Defendant at that time. Mr Taylor says that there was a mistake by Europcar as to its records, but the fact is, its records do show that car was rented to the first Defendant as at the relevant date.

30. Again, when I weigh up the competing evidence, I do give weight to the fact that contemporaneously Mr Taylor said that he was desperate for this stock, and he said that on 4 December. I take into account that Mr Bickerstaff seems to have reacted to that by making the product available very shortly thereafter, and the fact that the business records of the Plaintiff do record a collection on the relevant day. What that means is, that I am satisfied on the balance of probabilities that the goods, the subject of invoice number 85606 in the sum of $41,370.07 on balance were ordered and delivered, and therefore that invoice was payable.

31. I then come to the last collection date in dispute, which is 8 December which is the subject of three invoices totalling $30,695.

32. Mr Taylor's answer to this part of the claim was based on a number of points. The first being that he was in hospital on 8 December and therefore could not have collected the goods himself. The second is the Europcar registration and the fact that he says that that car was not in his possession at that date, and the third being, that there is an awful lot of cartons of Peroni mineral water said to have been collected and he says that it is obvious that it would not be possible to put all that Peroni into the particular van. It would be grossly overweight and anyway, it probably would not fit. I accept that submission. The storeman and packer witnesses called by the Plaintiff made it clear that if there was a series of collections by a customer on a particular day, then the run sheet should record each collection and delineate what was actually collected each time. The run sheet here does not do that, and on its face, records there being one collection.

33. On that point, I accept that there was not one single collection on 8 December, but rather it is much more likely that there were a series of collections, which means two things. Firstly, if there were multiple vehicles involved, then the run sheet only records one numberplate and if there were multiple collections involved, then the run sheet does not record multiple collections.

34. That makes me pause before being satisfied that there was such a collection on this day. However, when I go to the other evidence, and accepting that Mr Taylor was in hospital on the day, and it is not suggested that he was not, he does accept that his brother, Dion Taylor, whose signature he says may well be on the document, did work for the business from time to time, some time doing collections. Dion Taylor has not been called. Secondly, again, in the same email exchange that I have referred on a number of occasions, Mr Taylor did email the Plaintiff on 28 November in relation to these invoices and said he would them “tomorrow”. Again, even weighing in his favour, the confusion and perhaps frustration that he was feeling at the time, that is a piece of evidence that weighs in favour of the Plaintiff.

35. This particular delivery is the one that has caused me to consider the matter most carefully, and that is because of the issue concerning the van, to which I have touched on, but notwithstanding that issue, which does weigh against the Plaintiff proving this particular collection, I am satisfied on balance that the collection, the subject of these invoices, was made on 8 December 2025, which means that invoices totalling $30,695.73, I am satisfied are due and payable.

36. There was a final two invoices totalling about $44,000, which were the subject of what appeared on the pleadings to be another disputed collection date of 19 December 2023.

37. Mr Taylor now accepts that that collection took place, which is a credit to him, and as he pointed out in submissions, if he was a dishonest witness this is probably something he would not have admitted. This is one of the reasons that I do consider Mr Taylor to be an honest witness, but of course, honesty and reliability are not the same thing. I consider him to be an honest, but unreliable, witness on the issues that I have identified.

38. Finally, I then come to the cross-claim filed on behalf of the first Defendant.

39. It has been prepared by a non-lawyer, Mr Taylor, and in essence, alleges the following. First, that the Plaintiff had no legal basis to allege that there was moneys outstanding. Secondly, that the Plaintiff had no basis to terminate the credit arrangement. Thirdly, that the termination of that credit arrangement has caused enormous damage to the Plaintiff's business, and has in fact destroyed it, and finally, that therefore the Plaintiff should be liable for the damages caused to the company by the loss of that business.

40. The legal bases for the claim, is not articulated in the pleading, but on the assumption that it might include, breach of contract, breach of duty of care, unconscionable conduct under what used to be called the Trade Practices Act, misleading or deceptive conduct under that same statute or some breach of the anti-competition laws. However, the Cross-Claim is put legally and, it seems to me, that, factually, the cross-claim is fatally flawed. Firstly, because of the finding that I have just made, that the various disputed invoices were in fact due and payable. Secondly, the concession that was made by Mr Taylor that in event the uncontested invoices relating to the alleged delivery on 19 December has always been outstanding. Against that objective fact, I cannot conceive of any legal basis upon which the Plaintiff could be held liable for cutting off a customer on a credit arrangement in circumstances where that customer was in default of that very same arrangement. For that reason alone, I consider the cross-claim must be dismissed.

41. That means that the orders I must make, and this includes the agreed amounts, the subject of delivery on 19 December, is a judgment in favour of the Plaintiff against both Defendants in the sum of $186,336.57.

[DISCUSSION CONCERNING INTEREST]

42. For all those reasons, my orders are as follows:

43. Judgment in favour of the Plaintiff against the First and Second Defendants in the sum of $216,967.50, inclusive of interest at the Court rates up until 3 March 2026.

44. The Cross-claim is dismissed.

45. Order the Defendants/Cross-Claimants to pay the Plaintiff/Cross-Defendant’s costs of the claim and cross claim.

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