Marshall v Birrinbar Pty Limited

DECISION: 1. Judgment for the plaintiffs against the first defendant for $41,543.23, with costs 2. Judgment for the second and third defendants against the plaintiffs, with costs

CATCHWORDS: BAILMENT - agistment of cattle for reward - full complement of cattle agisted not returned after demands by owners - bailor failed to discharge onus of proof that loss of the missing cattle was not due to any failure by it to exercise reasonable skill and care

Hill v Reglon Pty Limited [2007] NSWCA 295 at [46] - [47] Hobbs v Petersham Transport Co Pty Ltd [1971] HCA 26 CASES CITED: Nationwide News Pty Ltd v Naidu (No 2) [2008] NSWCA 71 at [16] - [18] Terry Hogan Prestige Cars Pty Limited v Opera Investments Pty Limited [2006] NSWCA 139 at [13] Turner v Stallibrass [1898] 1 QB 56 at 59

Garry Brent Marshall (First Plaintiff) Kerrie Marshall (Second Plaintiff) PARTIES: Birrinbar Pty Limited (First Defendant) Jaime Anneliese Elaine Wright (Second Defendant) Mark McMahon (Third Defendant)

COUNSEL: Each of the parties was unrepresented

SOLICITORS: Each of the parties was unrepresented

The dispute

1. On 11 January 2005 some 150 head of cattle belonging to the plaintiffs, Gary and Kerrie Marshall, were delivered to the first defendant's property, 'Birrinbar', for agistment, namely 133 female cattle, 1 bull and 16 calves. A number of the females were cows, some of which calved during the agistment. During December 2005 and the months following, the Marshalls made various demands for the return of their cattle together with any calves born during the agistment. The first defendant initially refused to return any cattle and only later returned some cattle after these proceedings were commenced. 174 surviving cattle were transported to Inverell where they were sold at auction on 20 April 2006. The Marshalls claimed damages from the first defendant, as a bailee for reward, in respect of some 95 cows they alleged were never returned.

2. The first defendant says that it returned all the cattle except for 37 head of cattle that died during the agistment due to causes outside its control and for which it was not responsible. In particular it contended that the 37 missing cattle died from a combination of causes: 18 died from poisoning by Urea Blocks ordered by the Marshalls, 2 died during calving and the remainder died from various causes including malnutrition, disease or from bale twine in their stomachs.
3. The main issues for decision were:

· The condition of the 150 cattle delivered to Birrinbar in January 2005? · How many cattle were returned by the first defendant in April 2006? · What happened to the missing cattle, and who was responsible?

Depending on the determination of these main issues, there were several subsidiary and consequential issues, such as the value of the cattle, lost agistment fees and the value of some items of equipment the Marshalls alleged were never returned to them.

4. The second defendant, Jaime Wright, was a director of the first defendant company and is the daughter of the third defendant, Mark McMahon, who assisted in the care and management of the property "Birrinbar". It was Mr McMahon who acted on the company's behalf in arranging and overseeing the agistment of the Marshalls' cattle. As against these defendants the Marshalls alleged that in breach of s 52 of the Trade Practices Act 1974 (Cth) they made misleading and deceptive representations to the effect that the first defendant was in a position to agist, maintain and care for the cattle, in reliance upon which the Marshalls placed their cattle for agistment on the first defendant's property, Birrinbar.

5. The second defendant, Jaime Wright denies that she made any representations to the Marshalls as to the property Birrinbar, or the agistment.

6. The third defendant, Mr Marshall, denied that he made any representations other than in accordance with the agistment arrangement, pursuant to which the first defendant would provide grass, water and a secure area for the cattle to graze.

The proceedings 7. Ultimately, none of the parties was represented during the second tranche of the trial. Furthermore, many aspects of the evidence were unsatisfactory. It is appropriate, therefore, to record some of the procedural history. What follows is but a potted summary of the sorry saga, but it suffices to illustrate the forensic complications with which these proceedings have been fraught.

As already recorded, the proceedings were commenced by way of a Statement of Claim filed on 6 April 2006, when the first defendant was still refusing to surrender up the Marshalls' cattle or to allow them access to the cattle to check their condition. An urgent application was made for orders allowing the Marshalls to enter onto the property Birrinbar to attend to the welfare of their cattle and restraining the defendants from disposing of or selling the cattle. The plaintiffs have never had a solicitor, and were represented by Mr A Radojev of counsel on direct instructions. An affidavit sworn by Mr Marshall was filed in which he deposed to dead and missing cattle and threats by Mr McMahon to sell the remaining cattle to cover outstanding agistment fees. On 10 April 2006 Judge Sidis made the orders requested ex parte. A firm of solicitors, The Law Company, then filed an Appearance for the defendants. There were negotiations following which the parties agreed that the cattle would be mustered by Mr McMahon with a view to them being sold by the Marshalls and $10,000 paid into court from the proceeds on account of mustering costs and agistment fees claimed by the defendants. The cattle were then mustered and transported to the Inverell sale yards and sold at auction on 20 April 2006. A crucial issue in this case, from the outset, was how many cattle left Birrinbar, in particular how many cows. One would have thought that the parties, and their lawyers, would have taken scrupulous care to count the cattle and have available at trial convincing and credible independent evidence on that issue. Alas, that was not to be.

Then followed numerous interlocutory hearings before the Judicial Registrar, including show cause orders why the proceedings should not be dismissed for want of prosecution. The Judicial Registrar twice extended the time for payment of the $10,000.00 into Court. The Marshalls did not pay the $10,000.00 into Court until 19 February 2007. There was then another round of numerous interlocutory hearings in which the Judicial Registrar tried to get the parties ready for trial, including more show cause orders and extensions of time for the filing of an Amended Statement of Claim and the filing of a Defence. During this period the firm of solicitors acting for the defendants, The Law Company, filed a Notice of Ceasing to Act on 6 July 2007 and went off the record, for the first time.

On 3 August 2007 another firm of solicitors, Webb and Boland, filed a Notice of Appearance for the defendants. That firm lasted about 3 weeks and it filed a Notice of Ceasing to Act on 28 August 2007. The next day, The Law Firm came back on the record, but only for 11 weeks until it again filed a second Notice of Ceasing to Act on 16 October 2007 and went off the record for the second time. Finally, at a Directions Hearing on 30 October 2007, the Judicial Registrar was informed that The Law Company had again agreed to act for the defendants, and their evidence was ready to be served. Accordingly, the proceedings were listed for mediation on 3 December 2007. But the defendants failed to serve their evidence in time and the matter came back before the Judicial Registrar on 20 November 2007 who noted that 'despite numerous orders the defendants have failed to serve evidence'. She vacated the mediation date and listed the matter for hearing ex parte on 11 December 2007. On the day of the hearing the defendants applied to vacate the hearing date. That application was not opposed and the hearing was adjourned, but Judge Garling made strict orders as to the filing of evidence. However, when the matter next came before the Court on 12 February 2008 the evidence was still incomplete. On this basis the Judicial Registrar listed the proceedings for hearing and directed that questions of evidence, either by way of affidavit or oral, were to be left for the trial judge.

Such was the state of affairs when the matter came on before me for hearing on Thursday 27 March 2008. Mr A Radojev of counsel appeared for the Marshalls, on direct instructions. There were no solicitors. I mention this only because an issue arose during the hearing as to the service of a document that would not have become contentious if solicitors had been retained. The defendants were represented by Mr C L Thompson of counsel, instructed by The Law Company. The hearing commenced at 10.00am, when counsel asked for time to discuss settlement. I adjourned the hearing from 10.10am until 11.40am when I was informed that the hearing was ready to proceed. But at 12.05pm Mr Thompson asked for time to obtain instructions. The hearing resumed at 12.45pm and proceeded through the balance of the day till 4.00pm. The hearing continued the next day, Friday 28 March 2008 (Day 2), without incident until at 12.15pm Mr Thompson asked for a further adjournment to obtain instructions on the terms of the agistment arrangement and the pleading at paragraph 2.2 of the Defence. I adjourned till 2.00pm, when Mr Thompson applied for an adjournment over the weekend. I reluctantly agreed, principally because Mr Radojev suggested that it might help shorten the case. Unfortunately, as events transpired, it didn't.

The hearing resumed at 10.00am on Monday 31 March 2008 (Day 3), with Mr Thompson cross-examining the first plaintiff, Mr Marshall, and continued till morning-tea. Counsel then asked to see me in chambers, where I was informed by Mr Thompson that his retainer had been withdrawn by the solicitors for the defendants. Upon returning to Court, I gave Mr Thompson leave to withdraw. The defendants' solicitor, Mr Grover, then applied for an adjournment, to seek another barrister.

There followed a short break while Mr Radojev sought instructions. When the hearing resumed at 12.35 I was informed that the plaintiffs would not oppose the adjournment application on the basis that the defendants agreed to certain conditions. I then adjourned the trial on agreed terms, including an order that the defendants pay the plaintiffs' costs of $15,000.00 within 28 days, and that they release the $10,000.00 paid into court by the Marshalls in part satisfaction of those costs. I listed the matter for directions on 8 May 2008.

When the matter returned to Court there were a number of developments. Firstly, The Law Company had filed another Notice of Ceasing to Act and had gone off the record for a third time. A Law Clerk from Barwick Stevens Lawyers sought leave to appear for the defendants. He indicated the defendants were ready to take a date for the resumption of the hearing and did not propose to put on any further evidence (including evidence from a veterinary surgeon who did some pregnancy testing on the cattle early in 2005). I therefore listed the hearing for resumption on 5 June 2008, on the basis that the hearing would proceed on that day, whether or not the defendants were represented.

On 5 June 2008, when the hearing was due to resume, however, more problems arose. Not only were the defendants again unrepresented, but also the plaintiffs did not turn up, having had a car accident in Yass on the way to Court. Mr Radojev appeared as a courtesy to tell me he was also withdrawing from the case, his retainer having been breached by the Marshalls: see Exhibit B. Mr McMahon, the third defendant and a director of the first defendant, and father of the first defendant, appeared and told me that he had approached a barrister from Tamworth, a Mr Donnelley, to act for the defendants, and was available to appear on 30 June 2008. I vacated the hearing and listed it for resumption on that date, at great inconvenience to the Court due to the variable vacation, to suit Mr Donnelley.

The matter duly came back to Court on 5 June 2008. Mr Donnelley did not appear, nor did he do the Court the courtesy of informing it that he would not be appearing. None of the parties was represented by either solicitors or barristers. Mr McMahon sought leave to represent the three defendants and I acceded to his request. Mr Marshall sought an adjournment in order to seek other legal representation, which Mr McMahon opposed. Having regard to Exhibit 3, the history of the matter, which I have outlined, and that all the parties had travelled to Sydney from the country for the hearing, it was my view that no purpose was to be served by further adjourning the hearing. Taking these considerations into account together with the provisions of the Civil Procedure Act 2004, in particular s 56 and s 60, I refused the adjournment.

The hearing then proceeded throughout Monday 30 June (Day 4) and Tuesday 1 July 2007 (Day 5) to a conclusion at 4.00pm, whereupon I reserved judgment.

I turn now to the law and to the substantive issues for determination.

The relevant legal principles 19. The applicable legal principles are straightforward. The plaintiffs rely upon a bailment for reward. Although that bailment was based on a contract, they sued the first defendant in tort, as they were entitled to do: Turner v Stallibrass [1898] 1 QB 56 at 59; Hill v Reglon Pty Limited [2007] NSWCA 295 at [46] - [47]. The first defendant was under a duty to take reasonable care of the agisted cattle: Smith v Cook [1875] 1 QBD 79. The bailee had the onus of proving that the goods bailed were not damaged or lost in consequence of any failure by it to exercise reasonable skill and care: Hobbs v Petersham Transport Co Pty Ltd [1971] HCA 26; Terry Hogan Prestige Cars Pty Limited v Opera Investments Pty Limited [2006] NSWCA 139 at [13].

Credit 20. The two main protagonists, Mr Marshall and Mr McMahon, were unreliable witnesses, both prone to reconstruct, dissemble and prevaricate where it suited them. Mr Marshall was garrulous and aggressive, and predisposed to making gratuitous self-serving comments whenever possible. Mr McMahon was more taciturn, but in turn his evidence was evasive and eristic. Mrs Marshall was a reluctant witness. There was no affidavit from her before trial, and she initially declined to give oral evidence, until after a short adjournment requested by her husband to talk to her. In the witness box she looked timorously at her husband at the bar table throughout her evidence, and gave versions that clearly he wanted her to give. Neither Ms Wright nor Ms Amelung gave any evidence at all. I did not, however, determine the factual disputes entirely upon considerations of credit and demeanour although I did look for consistency and, where possible, sought corroboration from the documents tendered.

The condition of the 150 cattle delivered to Birrinbar in January 2005 21. Ultimately, in the face of overwhelming evidence, the defendants conceded that 150 cattle were delivered to Birrinbar on 11 January 2005, not 134 as originally contended: see Mr McMahon's affidavit at paragraph 83. In addition to 16 cows with calves, there was 1 bull and 117 other females: see Annexure 'A' to Mr Marshall's affidavit of 7 April 2006. However, the mix of the other 117 females, and how many of them were pregnant, remained in dispute.

22. The defendants contended that the cattle arrived in poor and emaciated condition: see the Defence at paragraphs 1A.2 and Mr McMahon's affidavit at [39]. They also asserted they were unaware any of the cattle were in calf: Defence at paragraphs 1A.2 and 1.1. I was satisfied, however, that the cattle in fact arrived in good condition. The property on which they were previously agisted, Wanganui, was well grassed and the cattle had been well fed and watered. I was also satisfied that a number of the cows had either already calved (hence the 16 calves that arrived with the cattle), or were pregnant. Just how many were pregnant was hotly disputed.

23. The Marshalls contended that all the other 117 females were mature cows, 115 of which were in calf. They said the cows were several years old, having been purchased some years previously, prior to their agistment at Wanganui. This was not true, as the 117 females that were transported to Birrinbar were not in fact all mature cows, and clearly consisted of a mixture of cows and heifers: see the waybill at Annexure 'A' to Mr McMahon's affidavit, which was signed by both the shipper, Mr David Smith, and the manager of Wanganui, Mr Chris Skelton. Neither of these men was called to suggest their signatures were false or the contents of the waybill were incorrect. Nor were there 115 pregnant females: so much was established from the pregnancy tests carried out in February 2005 by the vet, John Brown: see the handwritten notes at Annexure 'B' to Mr McMahon's affidavit. At that time, only 65 cows were pregnant. Hence it cannot be true that 115 females were pregnant on arrival.

How many cows were returned in April 2006? 24. I turn now to the question of how many cows were given back to the Marshalls and delivered from Birrinbar to the Inverell saleyards for sale. Only one thing is clear beyond doubt, namely that 174 cattle were sold at auction on 20 April 2006. It is probable, therefore, that was the number that left Birrinbar 5 days earlier on 15 April 2006. What was in dispute was how many of the original 133 cows were among the 174 cattle returned. This was a pivotal issue in the dispute and yet, as I said above, the paucity of evidence on the question was extraordinary.

The Marshalls were not there, and relied simply on the documents provided to them by Elders Limited, the stock and station agents who conducted the auction: see Annexure 'B' to Mr Marshall's affidavit of 26 September 2006. In this document only 38 of the 174 cattle sold were described as cows. There was of course the bull, and there were 61 calves. The balance of 74 cattle sold was described as 71 heifers and 3 steers. The Marshalls contend, therefore, that 95 cows were missing.

Mr McMahon, who mustered the cattle in April 2006 pursuant to the consent orders made by this Court, contended that there were in fact 96 cows shipped from Birrinbar to Inverell, not 38. He relied upon the waybill at Annexure 'E' to his affidavit and contended that some of the 71 heifers sold at Inverell were in fact cows, and this accounts for the discrepancy between the two documents. But the original of the waybill was never produced and the carbon copy has clearly been altered, the number of cows in the carbon copy having been written over in ink: see Exhibit 8. The other signatories to this waybill were not called to explain this discrepancy.

The question of whether 96 cows or only 38 cows were transported from Birrinbar to Inverell for sale lies, in my view, in the evidence of the Marshalls, when they described their own count during November 2005. It is clear that some 65 females were pregnant in February 2005.

The uncontested evidence was, however, that the bull was then discovered to have a venereal disease, which he contracted at Wanganui, and was infecting the cows. He was thereafter segregated. Thus, the probability is that in addition to the 16 calves that arrived at Birrinbar, only a further 65 were born during the agistment. Thus, when the cattle were counted in late November 2005, there were 108 cows, 1 bull and 67 calves. 39 cattle were missing: 25 cows and 14 calves. Between November 2005 and April 2006, a further two cows went missing, as the Table below demonstrates. Table

Cattle Delivered/Born November Count Sold Missing Bull 1 1 1 - Cows 133 108 106 27 Calves 16 + 65 = 81 67 67 14 Total 215 176 174 41

I find, therefore, that the first defendant failed to return 41 cattle, consisting of 27 of the original 133 cows and 14 calves. I am further satisfied, for reasons that follow, that these 41 cattle died during the agistment.

What happened to the 41 missing cattle? 30. I turn now to examine whether the first defendant proved that the 41 missing cattle died during the agistment from causes not due to its failure, as bailee, to exercise reasonable skill and care.

Mr McMahon contended firstly that two cows died in June 2005, giving birth. There was no evidence to the contrary and he was not cross-examined on the issue. I am satisfied that this was the fact. The next question is whether the cows died through a want of care on his part. In my view, it was not incumbent upon the bailee of the agisted cattle to attend at every birth. There was no evidence to that effect and having regard to the agistment arrangements and the agistment fees (on either version), it cannot be inferred or implied. I am therefore satisfied that the death of these two cows was not in consequence of any failure by the first defendant as bailee to exercise reasonable skill and care.

Secondly, Mr McMahon contended that 18 cattle were poisoned in July 2005 from Urea Blocks ordered and paid for by the Marshalls. It was undisputed that late in June 2005 Mr McMahon collected 6 Urea Blocks (salt licks) from Texas Rural Traders, which he put out for the cattle. These blocks consisted of 10% Urea and did not adversely affect the cattle. Then in July Mr McMahon's partner, Ms Amelung, and his daughter collected a further consignment of Urea Blocks for the cattle. But these consisted of 20% Urea and caused the death of some 18 cattle.

It was Mr McMahon's contention that all he did was collect and distribute Urea Blocks as ordered by the Marshalls. On the other hand, the Marshalls' evidence was that they had nothing to do with ordering the Urea Blocks, which they contended were ordered from Texas Rural Traders and fed to the cattle without their knowledge, by Mr McMahon. Without evidence from Texas Rural Traders, I could not be satisfied as to who ordered the Urea Blocks. Nor was there any evidence as to what knowledge Mr McMahon had as to the propensity of Urea Blocks to be harmful, nor as to whether he made any enquiries about the appropriate concentration of Urea. Neither Ms Wright nor Ms Amelung gave evidence and it may be inferred that they were unable to give any evidence helpful to the first defendant. In my view, the first defendant, as bailee, failed to prove that the death of 18 cattle from Urea poisoning was not due to any failure on its part to exercise reasonable skill and care.

Thirdly, Mr McMahon contended on behalf of the first defendant that a further 14 head of cattle died on the property during the agistment from a combination of having bale twine tangled in their guts, and from 'existing illnesses and diseases such as BVC which caused the cattle to be weak and susceptible to the harsh cold of the winter'. He said (at paragraph 57):

"I know this because after finding the dead cows I cut some of their guts open and found bale twine tangled in there. Others that I found dead were of the same condition as they arrived on the Property, emaciated and poor condition (sic)."

But these were mere assertions on his part, not probative of the fact. As I have already found, the cattle did not arrive in an emaciated condition. The evidence did not support a conclusion that any cattle died of BVC (the venereal disease contracted from the infected bull), nor that the bale twine came other than from Birrinbar itself. The first defendant, as bailee, failed to prove that these 14 cattle died from such causes in the absence of the exercise reasonable skill and care.

In the result, the first defendant was only able to discharge its onus of proof in respect of 2 of the 41 missing cattle, and is therefore liable to the Plaintiffs for the loss of 39 cattle, namely 25 cows and 14 calves.

The value of the missing cattle 37. The plaintiffs claimed their loss at $700.00 per head of cattle.

38. This claim was not, however, consistent with the sale price at the Inverell auction: see Exhibit K. In my view the evidence only supports a finding that the value of the missing 25 cows was $650 a head, an amount of $16,250.00, and the value of the missing 14 calves was $275.00, an amount of $3,850.00. The total loss in respect of the missing cattle was, therefore, $20,100.00.

The equipment 39. The plaintiffs claim a further $1,400.00 for various items of equipment that were never returned by the first defendant. I am satisfied that the equipment, consisting of an electric cattle prod, pliers, tags, a calf puller and a drench gun, were unlawfully detained by the first defendant after an appropriate demand for their return, and that the reasonable value of the equipment was $1,400.00 as at April 2006.

The overcharging of agistment fees 40. The defendants clearly overcharged the plaintiffs for the agistment fees, particularly when they continued to charge for the full complement of cattle, knowing that some cattle had died. The claim of $12,640.00 is a reasonable amount in the circumstances, and I am satisfied that the plaintiffs are entitled to recover such an amount from the first defendant.

Interest 41. The plaintiffs proved loss as against the first defendant in a total amount of $34,140.00. A claim was made for interest, which in my view should be allowed at the appropriate statutory rate. The calculations are:

$34,140.00 from 20.4.06 to 31.12.06 (255 days @ 9% pa) = $2,146.61 $34,140.00 from 1.1.07 to 31.12.07 (365 days @ 10% pa) = $3,414.00 $34,140.00 from 1.1.08 to 15.7.08 (197 days @ 10% pa) = $1,842.62 Total = $7,403.23

42. The plaintiffs are therefore entitled to recover total damages from the first defendant of $41,543.23.

The claim against Mr McMahon and Ms Wright 43. I turn now to the plaintiffs' claim against Ms Wright and Mr McMahon under s 52 of the Trade Practices Act 1974 (Cth).

44. I am not satisfied that Ms Wright made any representations to the Marshalls as to the property Birrinbar, or the agistment or that anything she said to them in connection with the bailment was misleading or deceptive or likely to mislead or deceive the Marshalls.

45. As to Mr McMahon, any representations he made to the Marshalls were consistent with and did not extend beyond the agistment arrangement, pursuant to which the first defendant agreed it would provide grass, water and a secure area for the cattle to graze. In any event I was not satisfied that the Marshalls placed reliance on anything said by Mr McMahon in entering into the agistment arrangement. The evidence established that on the balance of probabilities, the Marshalls relied on their own inspection of the property when entering into the agistment arrangement.

46. The claim against the second and third defendants was not made out and there should therefore be verdicts in their favour against the plaintiffs.

Costs 47. Costs should follow the events. There were no offers of compromise or other special circumstances justifying a departure from the normal rule: r 42.1. The plaintiffs did not apply for an order in the nature of a Bullock order, nor in my view was there any basis for such an order: Nationwide News Pty Ltd v Naidu (No 2) [2008] NSWCA 71 at [16] - [18].

Disposition 48. I enter verdicts and direct the entry of judgments as follows:

• Verdict and judgment for the plaintiffs against the first defendant for $41,543.23.
  • Verdict and judgment for the second and third defendants against the plaintiffs.

49. I order the first defendant to pay the plaintiffs' costs, except as to any interlocutory orders already made, as to which the costs may be set-off between those parties.

50. I order the plaintiffs to pay the costs of the second and third defendants, except as to any interlocutory orders already made, as to which the costs may be set-off between those parties.

51. The exhibits may be returned after the expiry of 28 days.

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