Napier v Lone Star US Imports Pty Ltd - [2019] NSWCATCD 31 - NSWCATCD 2018 case summary — Zoe

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Napier v Lone Star US Imports Pty Ltd

[2019] NSWCATCD 31

NCAT Consumer and Commercial|2018-12-06

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At a glance

Source facts

Court

NCAT Consumer and Commercial

Decision date

2018-12-06

Source

Original judgment source is linked above.

Judgment (18 paragraphs)

[1]

Procedural history

The proceedings were commenced by an application made on 13 September 2018 and relate to a claim for damage to a motor vehicle. The matter first came before the Tribunal for conciliation and hearing on 16 October 2018 at Liverpool. The parties both attended that listing in person. In accordance with the Tribunal's usual practice where both parties are present in person, prior to the case being called, the parties were provided with an opportunity to attempt to resolve the dispute cooperatively; this was not successful. The application was then adjourned for hearing on a date to be fixed by the Registrar. Directions were made for the parties to exchange and file documentary evidence they intended to rely upon at the hearing. Leave was also granted for the parties to be legally represented.
On 18 October 2018 the Registrar listed the matter for hearing on 6 December 2018 and sent related notices to the parties.
On 25 October 2018 the applicant requested an extension of time to comply with the orders made on 16 October 2018. On 30 October 2018 the respondent stated there was no objection to the extension of time request and also applied to the Tribunal for an interlocutory hearing on the issue of jurisdiction.
On 2 November 2018 the Tribunal made ex-parte orders extending the timetable for the exchange of evidence and written submissions. The application for an interlocutory hearing on jurisdiction was refused and it was noted the issue could be dealt with at hearing.
On 20 November 2018 the applicant requested the proceedings be transferred from the Motor Vehicles List to the General Consumer List. The Registrar replied on 21 November 2018 that the issue would be dealt with by the Tribunal at hearing.
A hearing of the application occurred on 6 December 2018 at Liverpool when both parties attended and were represented by legal practitioners. The Tribunal reserved its decision at the conclusion of the hearing.

[8]

Where and when did the contract arise?

The applicant contends agreement was reached on 8 February 2018 during a telephone call. The applicant's evidence is that the following conversation occurred between Robert Napier and an employee of the respondent, "Sam": Robert: Hi Sam, can you ship a car from the States for me? Sam: What kind of car is it? Robert: A 1932 Ford Phaeton. It is a real good car. What assurances can you give me that it will be safe during transport? Sam: "No, no, you don't need to worry. It'll be fine. We have shipped many valuable cars before. We can do it for $3,000 but depends on whether it needs a wash at the quarantine yard. Robert: Ok. Sounds good. It won't need a wash. It's a very clean car. Sam: "That's not up to us. The quarantine yard will make that call. I will send you an email with all the details for shipping. It will include the address of Oceans who will pack the car into a container. They are our US agents. You will need to have the car dropped off there. The email will also include a link to a website where you can complete the import application. Robert: OK. No worries. How long will the car sit at Oceans? Sam: It should not sit there for more than a few weeks after the import application is approved. Would you like to complete the import application yourself? I can do it for you, if needs be. Robert: No, that's ok. I'll be in contact with you after I receive the email.
The content of the 8 February 2018 telephone discussion has not been disputed by the respondent.
An email was sent to the applicant by the respondent at 1:37 PM on 8 February 2018. The email contained the following: Hello Rob, Here is the information sheet with the address to deliver the Ford. The link to apply for the import approval is also included. Please ring if you have any questions? Regards Sam
The email included an attachment entitled "Client information.docx". The content of the email and attachment is undisputed.
Although the respondent contends the contract only arose at the time the applicant delivered the vehicle to Oceans on 21 February 2018, the balance of the evidence is that it was agreed by the time the email was sent on 8 February 2018.
Essential terms of the agreement were settled during the telephone conversation. That is, the applicant would pay the respondent $3,000 to "ship a car from the States". There was the possibility of a higher charge depending on whether the vehicle needed "a wash at the quarantine yard", but the applicant accepted the offer made by the respondent, which was for a minimum cost of $3,000, by replying "Ok, Sounds good". The email that followed was the provision of further information to allow for performance of the agreement, namely the details of the location where the vehicle was to be delivered in the USA.
The content of the email confirmed the respondent understood there was agreement with the applicant about the services to be provided. The email stated "Here is the information sheet with the address to deliver the Ford", which is clear indication the respondent at that early stage anticipated delivery of the vehicle and would be bound by the terms agreed during the telephone discussion.
The Tribunal is satisfied the contract for the importation of the vehicle arose during the telephone contact between the parties on 8 February 2018, who were both in New South Wales at the time. The applicant is a resident of New South Wales and the respondent is a corporation located in this state. The agreement between the parties was concluded in New South Wales. The Tribunal is satisfied the contractual consumer dispute that can be heard and determined pursuant to the FTA.

[10]

Was the vehicle damaged?

The applicant relies on photographic evidence of the condition of the vehicle. Many of the images were obtained on the day the vehicle was delivered to Oceans on 21 February 2018. Statement evidence was also produced by the applicant, about the condition of the vehicle at the time of delivery to Oceans, from Mr David Lerian and Robert Napier. Mr Lerian was the former owner of the vehicle and had it in his possession until the time it was delivered to Oceans. According to his statement evidence, Mr Lerian had undertaken the work to restore the vehicle to its condition at the time of sale to Mr Napier. The applicant also relies on the document entitled 'Warehouse Receipt" dated 21 February 2018 that was provided to Mr Napier by a staff member at Oceans when the vehicle was delivered.
It was Mr Napier's evidence that he returned to the Oceans yard on 22 February 2018 to place a "painters drop sheet over the Ford to keep the fabric roof clean and protect it from damage". His evidence is the vehicle was in the same condition on that date as the day before when it was delivered to Oceans.
The evidence of the condition of the vehicle at the time it was delivered to Oceans was not the subject of challenge by the respondent at the hearing. The witnesses who made the statements were not called for cross-examination and there was no objection to the tender of the statements.
According to the Warehouse Receipt, at the time the vehicle was left at Oceans, it had a hairline scratch on the roof, two chips near the rear left side wheel arch, three scratches on the front bumper, two scratches on the rear window and a scratch on the front right side door. There is also reference to "hairline scratches all over vehicle". The statement and photographic evidence is consistent with the Warehouse Receipt with respect to the condition of the vehicle.
The respondent contended the vehicle was not undamaged at the time it was delivered to Oceans and the applicant has no evidence it was undamaged prior to delivery. Other than the Warehouse Receipt, and the issues identified therein, the respondent produced no evidence about the condition of the vehicle at the time it was delivered to Oceans.
The applicant relies on the statement of Robert Napier about his observations of the vehicle when it was unstrapped and removed from a shipping container on 11 May 2018 at a quarantine yard in Australia. Mr Napier's evidence is:: I then closely inspected the Ford. I observed damage to the front lower apron and paint chips on the front right-hand door. I observed a large scratch mark to the Ford badge at the front of the bonnet. I also observed a crack on the right-hand side deflector glass. I had not seen this damage to the Ford when I last saw it in the warehouse at Oceans on 22 February 2018.
Mr Napier returned to the quarantine yard on 12 May 2018 and obtained photographic images of the vehicle depicting the damage he said was observed the previous day. Those photographs were tendered in evidence.
The applicant obtained statement evidence, dated 12 November 2018, from Mr Stephen Mansueto, a loss assessor, who inspected the vehicle on 19 October 2018 and stated: I physically observed the following: 1. Damage to the lower front Centre Apron panel. 2. Damage to the front "I" beam axle. 3. Damage/misalignment to the lower grille panel. 4. Damage to the left front guard. 5. Damage to the upper grille badge/emblem "Ford". 6. Damage to the right front door. 7. Damage/misalignment of the front window and vertical posts. 8. Broken right side wind deflector glass. 9. Damage to the rear panel.
The statement of Mr Mansueto was tendered in evidence by the applicant without objection and the respondent did not call him for cross-examination.
The evidence establishes the vehicle was in a different condition from the last time Mr Napier saw the vehicle in the USA to the date he saw it removed from the shipping container in Australia. The defects identified by Mr Mansueto were not included in the Warehouse Receipt document prepared on 21 February 2018.
The Tribunal is reasonably satisfied on the evidence that the vehicle was damaged sometime between the time Mr Napier returned to Oceans on 22 February 2018 to put the drop sheet in place and the time it was observed by Mr Napier after being removed from the shipping container on 11 May 2018.

[12]

Was Oceans the respondent's agent?

The respondent denies that Oceans was its agent and asserts that the applicant had a direct contractual relationship with Oceans for the storage and shipping of the vehicle. There is, however, almost no evidence to support this contention.
During the 8 February 2018 telephone conversation between Mr Napier and the respondent's employee (Sam), Oceans was referred to by Sam as "our US agents". The attachment to the 8 February 2018 email that followed the telephone conversation refers to Oceans as the "Business name and address of the freighting company we use in Los Angeles".
The Warehouse Receipt issued by Oceans and given to the applicant (Mr Napier) on 21 February 2018 states "Bill to: Lone Star Imports-Darkes Forest NSW".
The respondent issued an invoice on 14 May 2018 for duty, GST and "freight" described as being "for shipping 1932 Ford Phaeton". There was no payment request made of the applicant by Oceans.
The only document in evidence originating from Oceans that relates to the applicant is the Warehouse Receipt of 21 February 2018. The receipt contains details about the vehicle and relates primarily to the condition of the vehicle at the time it was delivered to Oceans. It is a type of document that would be expected to be provided in circumstances where a valuable item, such as a motor vehicle, was taken into the care and possession of the receiving party. The receipt is not in the nature of a contract between the applicant and Oceans as it contains no terms and conditions save for a purported limitation of liability for the "Warehouse". There is no evidence the applicant was ever required to negotiate any aspect of the storage, packing or shipping arrangements directly with Oceans.
In the communications of 8 February 2018 the applicant was directed by the respondent to deliver the vehicle to its "US agent" for the vehicle to be exported from the USA to Australia.
Given the respondent presented Oceans to the applicant as its "US agent", the applicant had no reason to doubt the relationship was precisely that - one of agency for which the agent, Oceans, was acting on behalf of the respondent as principal. At no time after being told Oceans was the respondent's agent did the respondent inform the applicant to the contrary. The respondent is prevented in such circumstances from now denying the agency: Soames v London & SW Rly Co (1919) 88 LJ KB 524.
The Tribunal accepts that Oceans was the respondent's agent at all relevant times.

[13]

Is the respondent liable for the damage caused by Oceans?

The vehicle became the subject of a bailment arrangement at the time Oceans received the vehicle from the applicant. At that point the respondent, by its agent Oceans, was obliged to store, package and transport the vehicle safely to the applicant in Australia. Safe delivery of the vehicle was an essential term of the contract that arose on 8 February 2018. In taking charge and possession of the vehicle as bailee, the respondent had a duty to take proper care of the vehicle until the time it was delivered to the applicant.
The respondent as bailee can be distinguished from the role provided by Oceans, which was merely to provide the means by which bailment of the vehicle was arranged and came into being. Oceans did not contract with the applicant to effect the carriage of the vehicle to Australia, it provided the necessary services for the respondent, as its agent, to do so. In such circumstances, the respondent was the bailee, not Oceans: EMI (New Zealand) Ltd v William Holyman and Sons Pty Ltd [1976] 2 NZLR 566. Accordingly, liability for the damage to the vehicle rests with the respondent.
The Warehouse Receipt contains reference to a purported limitation of liability that states "Warehouse and property liability is limited to $500 per vehicle and $40 per article - not to exceed $500". The reference to the purported limitation of liability appears on a receipt, which is not a document in the nature of a contract. It makes no reference to the respondent, only "Warehouse" liability. It is plainly designed for the limitation of liability for Oceans in its own capacity rather than protection of any other party. There was no discussion about limitation of liability between the applicant and respondent during at the time the contract arose on 8 February 2018. The respondent did not directly provide the applicant with any document of a clear and unambiguous nature that purported to limit its liability. The receipt issued by Oceans is not accepted as being part of the contract reached between the parties on 8 February 2018 and it does not operate to limit the liability of the respondent.

Napier v Lone Star US Imports Pty Ltd

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Decision date

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Judgment (18 paragraphs)

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Cases Cited (1)