Plaintiff v Defendant

2 In substance, there were three issues at the trial. The appellant, OHTCR denied that the respondent (Million Miles) was the owner of a Kenworth K104 truck, once registered as 1FJ 2YL 6 now in the possession of OHTCR and was entitled to possession of it. In the alternative, OHTCR asserted that it was entitled to a repairer's lien for repairs it had undertaken on the truck but made no counterclaim for the cost of those repairs. In other words, what OHTCR sought from the proceeding was to retain possession of the truck.

3 The magistrate concluded that Million Miles was the owner of the truck and that OHTCR was not entitled to exercise a repairer's lien over it. Further, it had not proved that it had repaired the vehicle, but was entitled to $4,268 representing the cost of a bull bar that it supplied and fitted. The third issue was the entitlement of Million Miles to damages for the detention of the truck.

4 The court ordered that the truck be delivered up to Million Miles and that OHTCR pay damages of $100,000 plus interest of $12,356, with damages accruing at $8,000 per month from judgment until 31 January 2023 and its costs on scale G. OHTCR obtained a stay on the whole of the judgment until the determination of the appeal.

5 A key person in the dealings between the parties to the proceeding was a Mr Darryl Beattie, who died on 7 May 2020. OHTCR claimed it agreed with Beattie on 21 January 2020 to repair the truck and it was delivered by a tow truck on 15 February 2020.

6 At the outset, I observed that the material before the court did not include a transcript of the second day of the hearing when the magistrate heard evidence of significance to the grounds of appeal. There had apparently been a malfunction in the recording process. Although the respective instructing solicitors had filed affidavits about the evidence taken that day, these affidavits were conclusionary and did not attempt to set out the course of the questions and answers. No contemporaneous notes were exhibited and no inquiry was made of the magistrate about notes or other sources of the evidence.

7 However, there was conflict between the positions stated by the respective solicitors and the issues on appeal were largely based on factual matters, such as contentions that findings were not open on the evidence, that fraud had been found, and that the onus of proof had been misapplied. I will come to the submissions for OHTCR in due course. The applicable principle about the absence of a proper record of the trial flows from Buzatu v Vournazos.[1] Where there is material conflict between the parties' affidavits as to the evidence in the court below the version which supports the decision appealed from will be accepted in the absence of any fair and practicable method of resolving the conflict.

8 The parties agreed that, in the context of my indication that I am not likely to find the affidavits helpful, I should apply this principle on the basis that further inquiries of the magistrate or the court would not reveal any fair and practicable method of resolving the conflict. I have paid particular attention to the magistrate's reasons for credibility findings and to the evidence to be found in the court book that was used at trial consisting of contemporaneous records.

9 The magistrates findings included, both as expressed in her reasons and evident from uncontested evidence before the court, the following:

(a) Million Miles operated as part of a group trucking business that included a number of other companies. Its director was Danny Borg, who gave evidence. Part of the group's business was a freight and logistics business known as Interstate Transport, and it was well known as 'Fred's'.

(b) Million Miles owned a Kenworth K104 truck. This finding was contested.

(c) At all material times, the truck was decorated in Fred's livery.

(d) At all material times, Million Miles was the registered owner of the truck and paid the relevant fee.

(e) Another part of its business was to hire out trucks on agreements with contractors (drivers). The agreements were predominately General Security Agreements, that were registered on the Personal Property Securities Register. This agreement was referred to by the magistrate as the 'PPSR'. I will refer to it as the GSA.

(f) Darryl Beattie operated his business through a company SMD Logistics Pty Ltd that had on 6 August 2015 entered into the GSA in respect of the truck with Million Miles, of which Beattie was guarantor. The purpose of the GSA was to finance the purchase of the truck by instalments.

(g) The GSA, dated 6 August 2015, gave possession of the truck to SMD, which agreed to pay $104,549 to Million Miles by 36 monthly instalments. Beattie was the director of SMD. SMD's covenants in respect of the truck were defined by clause 12 of the agreement. Any release, discharge, or reassignment of the truck was, by clause 10, dependent on the observance and performance of the covenants in the agreement, particularly repayment of the sum of $104,549.

(h) On 23 December 2015, Million Miles registered a security interest in the truck on the personal property securities register.

(i) Neither SMD nor Beattie was ever registered as the owner of the truck.

(j) On 3 October 2016, SMD and Interstate Trucking Pty Ltd (part of the Fred's Trucking group) entered into a Contractor and Tow-Haulage agreement, pursuant to which SMD earned revenue that permitted it to service the obligation to make the monthly payments to Million Miles

(k) On 7 September 2018, SMD was placed in liquidation.

(l) After that, Beattie was in possession of and continued to operate the truck, apparently under the same arrangements, by virtue of a 'gentleman's agreement' he negotiated with Borg. He did not become the registered owner of it but was noted as an interested party on the insurance policy with QBE that also noted Million Miles as an insured party.

(m) The truck was damaged in an accident on 18 April 2019.

(n) On 27 May 2019, on a claim was lodged by Beattie, QBE assessed it to be a repairable write-off valued $66,000, with a salvage value of $12,000. Beattie was asked to confirm that there was no finance on the truck. Million Miles was not informed about the payout prior to the settlement amount, apparently paid or released to Beattie. The magistrate did not accept OHTCR's evidence that Beattie purchased the truck from the wreckers.

(o) QBE paid approximately $43,000 to Beattie. Million Miles later complained that the proceeds ought to have been paid to it as owner.

(p) Its registration was cancelled on 6 August 2019.

(q) OHTCR is a family company associated with Scott Brown-Sarre and his father Jerry Brown-Sarre.

(r) OHTCR claimed it agreed with Beattie on 21 January 2020 to repair the truck and it was delivered to its premises by a tow truck on 15 February 2020. The magistrate rejected this evidence.

(s) Although aware of the obligations of SMD under the GSA that he had assumed by the gentleman's agreement, Beattie remained in default, indebted to Million Miles in the sum of $59,827. It was unclear precisely how this sum was made up.

(t) Beattie died on 7 May 2020.

(u) After his death, Million Miles demanded the return of the truck from Beattie's partner, Vanessa Cross. The parties were clearly in dispute over the truck from about this time.

(v) Vanessa Cross, whose failure to give evidence was unexplained, engaged a business operated by Jerry Brown-Sarre, Intercapital Transport Consultants, regarding financial issues with Million Miles.

(w) On 7 September 2020, Scott Brown-Sarre enquired of Grant Borg at Fred's what was the purchase price for the truck. He was told $35,000 (excl. GST) and asked whether he wished to 'go further with this'.

(x) On 9 September 2020, Borg again asserted ownership of the truck.

(y) The OHTCR invoice for the repairs was dated 25 October 2020, but it was not provided to Million Miles until late September 2021. The magistrate concluded that this was a falsified document.

(z) The evidence did not show when any of the claimed repair work set out in that document was done.

(aa) OHTCR arranged to the truck to be repainted to remove the Fred's Transport signage and a new bull bar was fitted.

(bb) Million Miles issued the proceeding on 9 June 2021.

(cc) After obtaining an order from the magistrates court permitting him to do so, following numerous unsuccessful attempts, Borg, with his mechanic Chris Peters, inspected the truck on 8 April 2022.

(dd) The truck would have earned income in the Fred's fleet in the normal cartage of goods from May 2020 earning a net profit of at least $8000 a month. Million Miles was prevented from earning income for approximately 28 months.

10 By its notice of appeal, OHTCR raised seven grounds of appeal. They were that the magistrate erred:

(a) by misapplying the onus of proof by deciding the question of whether Million Miles was the owner of the truck by considering whether OHTCR had pleaded whether Million Miles had never been the owner of the truck without first determining whether or not Million Miles had established that it was the owner of the truck.

(b) by making factual findings that were not reasonably open on the evidence including:

(i) that the truck was under the continuous ownership of Borg's various companies and was that at all times registered to Million Miles or previous companies;

(ii) that Million Miles was part of the business known as 'Fred's';

(iii) that there was no evidence that Beattie held ownership of the vehicle;

(iv) that the service agreement bound the parties to it to have the truck repaired at the Million Miles repair depot;

(v) that Million Miles complained to QBE insurance that the insurance monies ought to have been paid to it;

(vi) that there was no evidence that Beattie had been given any authority to deal with the vehicle 'pursuant to the PPSR' or any other agreement;

(vii) that Beattie was indebted to Million Miles as alleged, or at all;

(viii) that Ms Strudwick was referring to Million Miles when she gave evidence that Beattie owed money;

(ix) that OHTCR had not carried out any repairs on the truck;

(x) that a dispute between the parties was live in July 2020.

(c) by failing to give adequate reasons for her decision, including by failing to:

(i) give reasons why her Honour was not troubled by the lack of evidence to establish continuity of ownership of the vehicle by the respondent;

(ii) give reasons why her Honour was satisfied that the respondent was professionally run and appropriately maintained business records;

(iii) give reasons why, in her Honour's opinion, whether the General Security Agreement was a hire purchase agreement was immaterial;

(iv) give reasons why a repairer's lien would not have been a priority interest over a registered security interest, contrary to s 73(1) of the Personal Property Securities Act 2009 (Cth); and

(v) adequately expose the path of reasoning adopted.

(d) in construing the General Security Agreement by failing to have regard to the actual text of the General Security Agreement, including clauses 12(d) and 14(a), and finding that the agreement only transfers ownership of the truck after all repayments are made pursuant to clause 9. The magistrate ought to have found that the General Security Agreement is proof that Million Miles was not the owner of the truck and that any interest Million Miles had in the truck was a registered security interest.

(e) By arriving at conclusions that were not reasonably open, which were:

(i) that Million Miles was and is the owner of the truck at all material times.

(ii) that OHTCR was not entitled to claim a repairer's lien over the truck was inconsistent with her Honour's finding that a bull bar had been supplied which enhanced the value of the vehicle. Having found that that a replacement bull bar had been attached to the vehicle, and that the paintwork had been refreshed, her Honour ought to have held that the appellant was entitled to exercise a repairer's lien over the vehicle and dismissed the proceeding with costs.

(iii) that there was no evidence to substantiate the assertions that Jerry Brown-Sarre's evidence was inconsistent with the evidence of Scott Brown-Sarre, whose credibility was not challenged and who gave evidence that he was the manager of OHTCR, that the truck was delivered to OHTCR prior to the death of Beattie and that the repairs were performed. Her Honour also failed to have regard to the evidence of Chris Peters that a number of items on the invoice were necessary repairs and that when he inspected on 8 April 2022 a number of those repairs had been done.

(iv) that Million Miles had any legal entitlement to possession of the truck.

(f) The magistrate took into account irrelevant considerations, or denied the appellant procedural fairness, in:

(i) finding that OHTCR had acted fraudulently where fraud was not pleaded. By not pleading fraud, this deprived it from ascertaining precisely what must be negatived.

(ii) misapplying the burden of proof at paragraph 15 of the reasons by holding that Million Miles should have pleaded that it was never the owner. In fact, Million Miles pleaded it was at all material times the owner of the truck and this was denied in the defence, thereby putting the respondent to proof.

(iii) taking into account a 'gentleman's agreement' between Beattie and Million Miles which was not pleaded and only arose in re-examination of Borg.

(iv) referring to documents in her judgment which were not tendered as evidence during the trial.

(g) The $112,356.00 awarded by the magistrate for damages was excessive and the evidence did not support an award of this amount.

11 The magistrate identified three questions from the written submissions filed by the parties following the conclusion of the evidence. The first of these was whether Million Miles had proved ownership of the truck. In finding that it had, the magistrate, accepting the evidence of Borg, found that the vehicle was purchased in 2003 in Wodonga by him and was continuously in the ownership of Borg's various companies, at all material times being registered to Million Miles or previous companies. Registration was never transferred to any other person or entity, and Beattie never sought transfer of ownership or became registered as owner of the vehicle. That Million Miles remained the registered owner of the truck was 'highly indicative' of its ownership of it.

12 The precise description of the GSA was immaterial to the question of ownership. Clause 9 of the agreement did not transfer title to the truck to SMD until the agreement was completed and discharged. That never occurred as SMD defaulted under the GSA and Beattie was in default under the gentleman's agreement when he died.

13 Ownership was also supported by the Fred's Transport signage on the truck as OHTCR well knew and acknowledged by the efforts of Scott Brown-Sarre to negotiate purchase of the truck from Borg. It was disingenuous of OHTCR to assert that Million Miles did not own the vehicle.

14 The second question was whether Million Miles had an enforceable security interest due to a second debt. The magistrate held that title to the truck never transferred to SMD or Beattie. The GSA continued in operation after the liquidation of SMD by force of the gentleman's agreement and the conduct of the parties and was never completed due to Beattie's continuing default. The GSA was a loan document with security embedded into it that did not transfer ownership or title to the truck to SMD or Beattie. Further, the gentleman's agreement did not interfere with Million Miles' right to reclaim the truck following the default and subsequent death of Beattie. Beattie acknowledged his liability as guarantor to pay the outstanding debt.

15 The final question was if Million Miles did have an enforceable security interest, did OHTCR have a priority interest due to the repairer's lien. The magistrate did not consider any question of priority arose because she was not persuaded that OHTCR was entitled to a repairer's lien. However, if it did her Honour concluded that Million Miles held the superior interest. Leaving to one side the installation of the bull bar, the magistrate was not satisfied that any repairs had been carried out, when they might have been done, the quantum of any repairs and whether OHTCR was authorised to carry out any repairs.

16 The magistrate applied the law as stated in Fitzgerald v Davis.[2] In this context, her Honour's findings were:

(a) OHTCR did not establish that Beattie delivered the truck to it or made any agreement with Jerry Brown-Sarre for the repair and improvement of the truck.

(b) OHTCR did not establish that it had the authority of the owner or someone with the authority of the owner to complete any works with respect to the truck. Further, Jerry Brown-Sarre either knew that Beattie lacked authority to authorise repairs or he wilfully carried out work without making any appropriate inquiries.

(c) OHTCR did not establish that it had effected any repairs or that any work that it claimed was done to a satisfactory standard. All that was evident was that a new bull bar was fitted and the Fred's Transport signage had been removed.

(d) Due to the untruthful evidence of Jerry Brown- Sarre and conflict between his evidence and that of Scott Brown-Sarre and the contemporaneous documents, the magistrate could not be satisfied what work, under whose supervision, was effected.

17 OHTCR failed to establish any entitlement to a lien and was not entitled to retain possession of the truck until paid for the claimed work.

18 The magistrate's reasons continued to explain why:

(a) the evidence of Jerry Brown- Sarre and Scott Brown-Sarre was not persuasive;

(b) the purported invoice produced was entirely unreliable and failed to substantiate the claim. The magistrate held that the invoice was a contrived document the content of which and the date when it appeared all persuaded her Honour that it was not a credible, bona fide invoice;

(c) an additional undated, unverifiable, document (the handwritten document) naming Beattie as customer and identifying the truck to be repaired to a roadworthy or saleable condition was 'a self-serving document without any established basis';

(d) the arrangement alleged by Jerry Brown-Sarre as having existed between himself and Beattie - as a verbal open-ended arrangement purportedly documented in the invoice and the handwritten document - was 'utterly inconceivable'. There was no credible corroborating evidence of it or, as a matter of probability, any reason to accept that OHTCR would verbally agree or that the financially troubled Beattie (or Ms Cross) would agree to authorise, carte blanche, unspecified repair work, with no completion time and no follow up about how the repairs were progressing, what the running tally was, or how much longer it was going to take before the vehicle was roadworthy or saleable;

(e) the invoice, work sheet and the other handwritten document were unsubstantiated, unverified, self-serving documents which were more likely than not to have been generated only to support OHTCR's claims for the purposes of the proceeding;

(f) the magistrate inferred from the unexplained failure of OHTCR to call Vanessa Cross that her evidence would not have assisted it and that the assertions about her involvement were unsubstantiated and inadmissible. OHTCR failed to prove that the repairs were authorised by her or that she had any authority or authorise repair work;

(g) the evidence of Borg was accepted and preferred to the evidence of Jerry Brown-Sarre which was rejected. Borg gave straightforward, direct, credible evidence and was a witness of truth. Jerry Brown-Sarre altered his account to suit his case from the inception of the dispute and continued to do so while giving evidence. He also generated non-contemporaneous documents to suit his assertions;

(h) Jerry Brown-Sarre variously described himself as the attorney for Vanessa Cross, a Transport Expert, Consultant and Para-legal, a party to an agreement dated 31 January 2021 with Vanessa Cross, the 'trustee' of the estate of Darryl Beattie, and as holding power of attorney for the estate of Darryl Beattie. The magistrate concluded that these descriptions appeared to be self-designated, without foundation, self-serving, and contrived to inflate his status, reflecting poorly as to his credit; and

(i) The magistrate documented eleven other matters that contributed to her conclusion to reject his evidence, including the documents he produced to support it, which were:

(i) His evidence that he was a mechanic which he later qualified;

(ii) The fanciful agreement with Beattie to repair the vehicle;

(iii) His assertion that he was not required to ascertain ownership of the vehicle;

(iv) That he did not know of Million Miles interest in the vehicle notwithstanding the signage and the attempts of Scott Brown-Sarre to purchase the vehicle from Million Miles.

(v) The lack of quantification of the costs of repairs.

(vi) The refusal to allow the plaintiff an opportunity to inspect the vehicle.

(vii) The extreme animus displayed by Jerry Brown-Sarre toward the Borg family and Million Miles for no explicable reason.

(viii) The magistrate was satisfied that Jerry Brown-Sarre arranged to have the Fred's Transport signage removed from the truck for his own purposes, there being no evidence of any agreement with Beattie for that to occur.

(ix) OHTCR could not establish the date of delivery of the truck to it and whether it was before Beattie's death.

(x) It was not possible to conclude that any repair work was carried out before Beattie's death.

(xi) The absence of any reference to the invoice, the claim of a repairer's lien, the sum of $28,781.50 (rather a claim for $46,050 for work done) in the other proceedings that Jerry Brown-Sarre prosecuted.

19 The magistrate went further to find that if she was wrong in making these findings, OHTCR failed to prove either the validity of the repairs or the quantum. OHTCR could not prove that Beattie owned the truck and that once asserted the written agreement dated 31 January 2021 which was not proved and could not be relied on. Likewise the invoice and oral evidence failed to prove the cost of the repairs said to support the lien.

20 The evidence did show that the bull bar had been supplied for the amount set out in the invoice of J&A Allen Excavations and enhanced the value of the vehicle and that sum was brought into account as a set-off against the damages to be awarded to Million Miles, the magistrate noting the stark contrast between the invoices of J&A Allen Excavations and Border Signs (for the repaint) and the OHTCR 'invoice', the former clearly being professionally produced business records.

21 Having found that the truck was at all times, and continued to be, owned by Million Miles, the magistrate accepted Borg's evidence that the truck would have earned income in the Fred's fleet in the normal cartage of goods. Borg said the vehicle would have earned somewhere between a gross figure of $38,000 and $42,000 a month, resulting in a net profit of between $8000 and $10,000 a month. The magistrate was satisfied that the truck would have been made operational once returned to it in May 2020 and that Million Miles was prevented from earning income for approximately 28 months.

22 The evidence at trial for Million Miles was called from Danny Borg, Director; Marie Strudwick, office manager and Chris Peters, mechanic for the plaintiff. OHTCR called two witnesses, Scott Brown-Sarre, and Jerry Brown-Sarre. The evidence was taken over two days and a transcript of the evidence on the first day was available when Borg and Ms Strudwick gave evidence. As to the evidence on the second day of the hearing, the court has affidavits from Mr Alexander Sheed-Finck, the solicitor for OHTCR, who was present throughout the whole trial, and from Mr Arkin Kaman, the solicitor for Million Miles, who was also present throughout the whole trial. Neither affidavit provides anything resembling a transcript or detailed notes and there are differences between the recollections of the deponents.

23 All of the documents referred to at trial that were exhibits were available in the form of the electronic court book that was used in the hearing.

24 OHTCR, by its first ground, submitted that the magistrate failed to put Million Miles to proof on its pleaded case, which was that at all material times it was the registered owner of the truck. OHTCR submitted that Million Miles was obliged to prove that it was the registered owner of the vehicle from 2003 until present. OHTCR submitted that there was no evidence that Million Miles had ever been the owner of the truck which was consistent with the defence and the magistrate erred in concluding that the truck was at all times registered to Million Miles or previous companies and ownership was never transferred to any other person or entity.

25 OHTCR submitted that the principle that a decision-maker who makes a finding of fact for which there is "no evidence" or which is "not open" makes an error of law is well established.[3] Her Honour made numerous factual findings where there was no evidence, or which were simply not open. The relevant factual findings are set out above at paragraph [10(b)].

26 First, OHTCR submitted that Million Miles was not incorporated until 30 June 2009 and it could not have been the registered owner since 2003 when Borg said he purchased the truck. No evidence was discovered which explained how Million Miles acquired ownership of the vehicle. The registration of Million Miles as the owner of the truck was not absolute proof, absent other evidence of ownership.[4] Further, the only evidence was of registration in favour of Million Miles in the year ending 6 August 2019.

27 The finding that the fact that the truck was displaying 'Fred's' signage when it was delivered to OHTCR which was highly indicative that the truck was owned by Fred's was irrelevant as SMD was providing services to Interstate Transport Pty Ltd and the agreement required vehicles to be painted in Interstate Transport's livery.

28 Secondly, the finding that Million Miles was part of the business known as 'Fred's' was contrary to the principle that each registered company is a separate legal entity that is distinct from that of its owners. Million Miles and Interstate Transport are not only separate entities but also had different directors and shareholders for all material times until 1 November 2019. They were neither related nor associated entities in terms of the Corporations Act 2001 (Cth). Interstate Transport was relevantly the company identified in the GSA. The finding that Million Miles was part of the Interstate Transport group which is colloquially known as 'Fred's' was not open.

29 Thirdly, it was not open to the magistrate to find that Beattie never owned the truck. The evidence was that from 6 August 2015, SMD was in possession of the truck and that following the liquidation of SMD in 2018, Beattie retained possession of the truck and was providing freight services to Interstate Transport until the accident on 18 April 2019. Being in possession, the applicable principle was identified in Simonson Properties Pty Ltd v Hardy by Sackar J, citing Cross on Evidence 9th Australian Edition at [41125], which states that:

Possession is prima facie evidence of ownership, and a second way in which ownership may be proved is by proof of possession in the property.

30 Further, positive evidence of SMD's ownership vis-à-vis Million Miles was found in the GSA which by cls 11 and 14(a) stated that SMD owned the collateral (the truck).

31 OHTCR also sought to rely on evidence given by Jerry Brown-Sarre that Beattie told him that he bought the truck back off the wreckers after the accident.

32 Fourthly, it was not open to the magistrate to find that Beattie was obliged to use the Fred's group repair shop.

33 Fifthly, the finding that Million Miles complained to QBE that the insurance moneys ought to have been paid to it was not open because it was unsupported by any evidence and Borg said he was unaware of the offer from QBE.

34 Sixthly, the magistrate erred in finding Beattie had no authority to deal with the truck whether pursuant to the GSA or any other arrangement for three reasons:

(a) he had authority as the owner of the truck;

(b) by force of cl. 12(d) of the GSA, which imposed an obligation on SMD, and by extension Beattie as guarantor, to maintain and protect the collateral and keep it in good working order, and on being required to do so by the secured party, immediately rectify every defect in its repair and condition; and

(c) Borg was pushing Beattie to get the truck back on the road and agreed that Beattie could incur expenses for repairs, although he was not aware that he ever did.

35 The magistrate did not explain why GSA cl 12(d) did not authorise Beattie to deal with OHTCR.

36 Seventhly, the magistrate erred in finding that, when he died, Beattie was indebted to Million Miles in the sum of $59,827. The finding that Mr Beattie failed to make the payments due under the GSA was unsupported by any evidence from Ms Strudwick, whose evidence was the apparent source for it. That sum appeared to have been operating expenses that were not secured against the truck by the GSA.

37 Eighthly, Ms Strudwick evidence was general, about Beattie's dealings with 'the group' that she clarified to be Fred's Interstate Transport, not Million Miles. Accordingly it was not open to find that Beattie was indebted to Million Miles when he died.

38 Ninthly, the finding that apart from the installation of the bull bar, OHTCR did not establish what, if any, repairs had been carried out was contradicted by numerous pieces of evidence including:

(a) the evidence of Chris Peters that further repairs had been undertaken;

(b) her Honour's finding that the paintwork had been refreshed;

(c) her Honour's finding that part of Mr Jerry Brown-Sarre's evidence was fabricated to 'justify the work he carried out on the vehicle';

(d) Mr Scott Brown-Sarre's evidence that the works were carried out as itemised on the worksheet and invoice;

(e) a comparison of exhibits 3 and 4, photos which show the 'before' and 'after' of the vehicle following repairs; and

(f) the fact that there was no evidence that a party other than the defendant performed repairs on the vehicle.

39 Finally, OHTCR submitted there was no evidence to support the finding that the parties were 'clearly in dispute shortly after the death of Mr Beattie in May 2020'.

40 The magistrate failed to provide adequate reasons in sufficient detail for the conclusion that:

(a) Million Miles was the owner of the truck;

(b) Million Miles was professionally run and appropriately maintained business records;

(c) whether the GSA was a hire purchase (HP) agreement was immaterial. The proper construction of the GSA was central to OHTCR's contentions and is the next ground considered. It was not a HP agreement and demonstrated that SMD was the owner of the truck; and

(d) had there been a repairer's lien, Million Miles held the priority interest under the GSA.

41 The magistrate erred in concluding that the GSA did not transfer ownership to the SMD until, and unless, the agreement had been completed and discharged. If the GSA was not a HP agreement, OHTCR contended that the only explanation for SMD or Beattie having use and possession of the vehicle since 6 August 2015 was ownership.

42 The key features of a HP agreement were recently explained by the Western Australian Court of Appeal in Gold Valley Iron Pty Ltd (in liq) v OPS Screening & Crushing Equipment Pty Ltd:[5]

It is a contract for the hire of goods between the owner of the goods (usually a financier) and a hirer of goods. The owner gives possession, use and other rights in respect of the goods to the hirer for a period in consideration of the hirer agreeing to make periodic payments to the owner to the observe or perform other obligations in relation to the goods. The contract confers on the hirer an option to purchase the goods from the owner.

43 What was absent from the GSA was the option to purchase the truck. The agreement did not indicate any sale transaction and could not constitute a secured sales transaction between Million Miles and SMD. Rather it identified Million Miles as the 'secured party', SMD as the 'grantor' or 'granter' and Beattie as the 'guarantor', and the truck as the 'collateral'. The GSA was a traditional security interest, a fixed charge over the truck. It must follow that the secured party, Million Miles, cannot also be the owner of the truck. As Beach J explained in Diversa Pty Ltd v Taiping Trustees Limited:[6]

Now of course the PPSA does not create a scheme akin to an old law mortgage whereby the mortgagee owns the property and all the owner has is an equity of redemption. Rather, grantor is always the owner of collateral, and a secured creditor simply has a security interest in the collateral, rather than having ownership of it.

44 Consistently, Million Miles had a security interest registered on the Personal Property Securities Register (PPSR) pursuant to the GSA.

45 OHTCR developed this submission in the following way.

(a) The table at clause 1 of the GSA identified key details, namely that the collateral is the truck, the purpose of the loan by Million Miles to SMD was to finance the purchase of the collateral, the amount to be repaid was $104,549.99, the term of the loan was 36 months, and the date of repayment was 6 July 2018.

(b) The magistrate misconstrued cl. 9 of the GSA which did not effect any transfer of ownership but governed the release or discharge of the security interest held by Million Miles. It was necessary to refer to cl. 11 and 14(a), which the magistrate failed to do. Clause 11 stated that SMD represented and warranted that it 'has a good right title and interest in the collateral, which is free from all encumbrances' and cl. 14 stated that 'the grantor owns the collateral'.

(c) Properly construed, the GSA did not enable Million Miles to retain title until all instalments were paid. Rather, the terms of the GSA constituted admission that Million Miles was not the owner of the truck. Nowhere in the GSA was Million Miles referred to as the owner of the truck or as having retained title to it.

(d) Objectively construed, there was no ambiguity in the proper interpretation of this agreement and extrinsic evidence was not admissible as an aid to its construction. It was erroneous to take account of Borg's opinion, or the livery on the vehicle, when construing the meaning of the terms of the GSA and the intention of the parties.

(e) It was erroneous to construe the GSA as a HP agreement.

46 The magistrate erred in making findings of fact that were not reasonably open.

(a) The magistrate found that Million Miles was and is the owner of the vehicle at all material times. In doing so, OHTCR submitted that the magistrate reasoned that:

(i) Borg stated that he purchased the vehicle in 2003 in Wodonga. The magistrate ought to have required proof of a specific chain of ownership by Borg or companies forming part of 'Fred's' group from the initial purchase to ownership by Million Miles and ought to have been troubled by the absence of such evidence and unable to conclude on the balance of probabilities that Million Miles owner the truck.

(ii) the GSA did not transfer title unless and until the agreement had been completed and discharged, which never occurred. Why this conclusion was in error has already been addressed.

(iii) the truck was registered to Million Miles, which OHTCR contended could not support an inference of title to the truck without more.[7]

(iv) the truck was painted in 'Fred's Transport' livery, an irrelevant consideration;

(v) Borg asserted ownership in an email dated 9 September 2020.

(b) These findings were insufficient to prove ownership in Million Miles.

(c) The magistrate concluded that OHTCR was not entitled to claim a repairer's lien over the truck.

(i) It was not contentious that the truck was damaged in an accident and assessed as a write-off.

(ii) The applicable principles that ought to have been applied by the magistrate in assessing whether OHTCR was entitled to a repairers lien were set out in Dinmore Meatworks Pty Ltd v Kerr.[8]

(iii) OHTCR relied on the evidence that it led before the magistrate that it agreed with Beattie to repair the truck into a roadworthy or saleable condition. Beattie was the owner, or had the authority to authorise repairs, as contended under ground 2. Alternatively, it was reasonable for OHTCR to infer Beattie had such authority as he was in possession of the vehicle and represented that he purchased it back from the wreckers following the accident.

(iv) OHTCR had performed some repairs on the evidence even if not to the full value claimed. Million Miles, if owner, had not tendered any sum.[9] So much was evident from before and after photographs, the evidence of Scott Brown-Sarre and Jerry Brown-Sarre, the evidence of Million Miles' mechanic, Mr Peters, the invoices from J&A Allen Excavations in relation to the bulbar and Border Signs in relation to new paint job, and the OHTCR invoice and worksheet with handwritten annotations.

(d) It was not open to the magistrate in the face of this evidence to find that OHTCR was unable to prove that any repairs were carried out prior to Million Miles asserting ownership of the truck.

(e) The magistrate held that no corroborative evidence has been put to the court to substantiate any of Mr Jerry Brown-Sarre's assertions. Yet the credibility of Scott Brown-Sarre was not challenged. He gave evidence that he was a qualified repairer and that he, Jerry Brown-Sarre, and other employees of OHTCR, carried out the repairs as detailed in the invoice. There was no basis in the evidence for the magistrate to doubt that:

(i) the truck was delivered by Beattie to OHTCR before his death;

(ii) Beattie agreed with OHTCR that it repair the truck;

(iii) Jerry Brown-Sarre did not know that Beattie was not the owner or had no authority to authorise repairs.

(f) OHTCR was not entitled to resist demands for delivery up of the truck made by Million Miles. Million Miles had not proved that it had exercised its security interest on a default by Beattie.

47 OHTCR submitted that the magistrate took into account irrelevant considerations, or failed to afford the appellant procedural fairness in four respects, which were:

(a) finding that the appellant had acted fraudulently where no fraud was pleaded. OHTCR submitted that the magistrate's findings, notably in rejecting the evidence of Jerry Brown-Sarre were 'consistent with fraud'. The magistrate found that he;

(i) fabricated evidence to justify the work he carried out on the truck;

(ii) generated the invoice document, work sheet and other handwritten documents only to support OHTCR's claims for the purposes of the proceeding;

(iii) did not enter into any agreement with Beattie.

OHTCR submitted that the magistrate erred in that fraud that is not alleged in pleadings cannot be proved at the trial.[10] Further, more substantial proof was required to prove such allegations:[11]

(b) as earlier submitted, the magistrate misapplied the burden of proof;

(c) the magistrate ought not to have taken any account of the 'gentleman's agreement'; and

(d) the magistrate took account of documents that were not in evidence.

48 OHTCR's final ground was that there was no evidence to support the damages assessment and the award of $100,000 plus interest of $12,356 was manifestly excessive. In substance, this ground was that Million Miles had a duty to take all reasonable steps to mitigate any alleged loss and damage.[12]

49 Borg's evidence was that Million Miles was losing $8,000 per month by the truck not being on the road. Approximately 13 months passed between the accident on 18 April 2019 and Beattie's death on 7 May 2020, and more than three years have since passed. Million Miles ought to have tendered the sum claimed by OHTCR of $28,781.50 which would have entitled it to possession of the truck and mitigated losses in excess of $250,000 that were only reduced by abandonment of the excess above the magistrates court jurisdictional limit.

50 Million Miles submitted that the evidence persuaded the magistrate that OHTCR was seeking to retrospectively establish or validate the authorisation of the repairs. This was a relatively simple case in which, although Jerry Brown-Sarre sought to perpetrate invoice fraud, all that was alleged was the elements of the entitlement of Million Miles to the return of its truck. The adverse findings against Jerry Brown-Sarre were properly understood as adverse credit findings, not findings of fraud. OHTCR initially alleged that it owned the truck, but declined to make that case at trial, which commenced on the basis that Million Miles needed to meet the allegation that Vanessa Cross sold the truck to OHTCR.

51 However, the contemporaneous communications by email showed OHTCR acknowledging that Million Miles owned the truck, because they sought to buy it from it. It was open to the magistrate to have regard to tacit admissions made by Beattie in two emails that Million Miles owned the truck.

52 The agreements with SDM were not relevant. Possession of the truck had been determined by oral agreements between Borg (who gave evidence that the magistrate accepted), Beattie (deceased), Cross (who fell into the OHTCR camp and whose absence from giving evidence was unexplained) and Jerry Brown-Sarre (whose evidence was totally rejected). There was no evidence of Beattie ever asserting ownership and his possessory rights were founded on the gentleman's agreement described by Borg.

53 The GSA was a badly drafted HP agreement, complicated by the liquidation of one of the parties to it, SDM, that destroyed any rights in the truck to which SDM may have become entitled.

54 Million Miles persuaded the magistrate that it was the owner of the truck entitled to its return and that it never authorised OHTCR to carry out any repairs. Further, it was entitled to damages for the detention of the truck. OHTCR failed to persuade the magistrate that it was properly directed, by a person with authority, to repair the vehicle. Its contentions were that Beattie owned the truck and authorised the repairs. Those contentions were founded on oral evidence that was rejected and documents that were not proved as authentic. The evidence of the registration of the truck was sufficient in the circumstances for the magistrate to be persuaded as to Million Miles' proofs. As to loss, OHTCR never contended that the wrong entity was suing or that Million Miles had failed to mitigate its loss.

55 Contrary to the contentions of OHTCR, there was ample evidence beyond the fact of registration that the owner of the truck was not Beattie but a member of the Fred's Transport group, which Million Miles was. There was affirmative evidence that supported registration including Borg's evidence that he purchased the truck by a Fred's Transport group company, insurance of it by Interstate Transport, a depreciation schedule, and acknowledgement by Beattie, including emails evidencing a good relationship between Ms Strudwick and Beattie in which Beattie never asserted ownership against the Fred's Transport group.

56 There was no evidence of transfer of ownership from Million Miles when in the ordinary course there would be a transfer, payment of stamp duty, and a record at VicRoads. OHTCR asserted that Beattie purchased the truck from the insurer following the accident, a proposition not established on the evidence, and that Cross was entitled to possession of it as executor of Beattie's will, another proposition that was not established. As none of those propositions were established, the inference of ownership from registration remained probable, and required that OHTCR resile, as it did, from its initial claim of an agreement with Cross about the truck.

58 The notion that Million Miles gifted the truck to Beattie as a term of the gentleman's agreement was not open. It must be inferred, with some force in the circumstances, that evidence from Cross, whose absence was unexplained, about an alleged agreement signed as Beattie's executor and about possession of the truck after his death would not have assisted OHTCR. A like inference would have been open to the magistrate from the absence of evidence and records from the liquidator of SDM although the magistrate was not invited at trial to draw that inference.

59 Significant weight must be given to the emphatic terms in which the magistrate rejected not just the oral evidence of Jerry Brown-Sarre but also the authenticity of the documents he produced. The magistrate was entitled to and did reject the hearsay evidence from Brown-Sarre that Beattie in January 2020 said he owned the vehicle and had bought it back off the wreckers after the accident.

60 Although there was no documentary record of Million Miles complaining to QBE that the insurance payout ought to have been made to it, It was open to the magistrate to accept Borgs' oral evidence, particularly as Million Miles was a co-insured and was aware of the accident.

61 While it was plausible that Beattie had authority to authorise the repair of the truck promptly after the accident, that did not occur. Borg's evidence was that Interstate Transport expected the truck to be returned into service under the Contractor and Tow Haulage Agreement to earn wages for Beattie. There was no evidence that might have supported a finding that title to the truck passed to Cross or OHTCR.

62 Further, OHTCR's evidence about the agreements between Jerry Brown-Sarre and Beattie (later Cross) was rejected. The magistrate concluded that the court could not determine when the truck, and from whom, came into the possession of OHTCR. Neither could the court determine whether any repairs were done to the truck before Borg made a demand for it or Scott Brown-Sarre enquired about buying it from Fred's Transport. It was well open on the evidence for the magistrate to infer that no repairs had been done as at 8 September 2020 by which time OHTCR well knew it had no authority to repair the vehicle.

63 Regarding the repairs, the magistrate was also not satisfied that:

(a) OHTCR kept adequate records, particularly in respect of stock;

(b) the minor collision damage to the front left hand side of the truck warranted the refurbishment of the truck, which was what appeared to be documented in the 'invoice' and 'pre-works agreement'. The magistrate concluded that OHTCR's list of repair items included items that 'had either not been carried out, effected to a satisfactory standard or were unnecessary. Million Miles conceded that some repairs were undertaken, limited to what was established by evidence; and

(c) the 'invoice' was a legitimate business record. Rather the magistrate was satisfied that the 'invoice' came into existence to assist the claim and was a contrived document.

64 The magistrates findings were supported by the unexplained absence of:

(a) any OHTCR mechanic to give evidence of repair work done;

(b) Vanessa Cross.

65 OHTCR did not plead failure to mitigate loss, nor did it run that defence below and cannot now take that point. There were two separate losses, loss of haulage income and loss of the payments required to be made on the truck (which I take to be a reference to the GSA). OHTCR did not take, plead, or run below the point that the haulage income was a loss to another Fred's Transport company. The evidence, accepted by the magistrate, was that the various companies comprising Fred's Transport were treated as 'a group' for accounting and taxation purposes and the magistrate was entitled to award damages to Million Miles and leave it to the group to more precisely assess the financial implications. Borg was a director of all relevant companies.

66 The issue of the ownership of the truck developed in an unusual way before the magistrate. Before noting how that happened, the relevant period for the inquiry does not extend back to when Borg says he bought the truck in Wodonga. It is the period from 18 April 2019 to the commencement of the proceeding.

67 First, Million Miles plea of ownership of the truck was denied by OHTCR by a specific plea that it was OHTCR that owned the truck. It did so by asserting a written contract between Vanessa Cross, as executor of the estate of Beattie. OHTCR contended that Beattie owned the truck from the time of the insurance payout, delivered it to OHTCR, authorised the repair of it, but the cost of the repairs remained outstanding when Cross transferred ownership of the now unregistered truck to OHTCR in satisfaction of the unpaid debt for the repairs. However, this claim was abandoned at trial.

68 Secondly, ownership of the truck was said to be inferred from the GSA in the manner submitted by OHTCR. On the other hand, Million Miles submitted and the magistrate appeared to agree, the GSA was a form of hire purchase agreement. Each approach cannot assist in determining the proper inferences to be drawn on the whole of the evidence as to the ownership of the truck at the relevant time.

69 From the uncontested evidence, it must be inferred that following the liquidation of SMD the truck was owned by Million Miles and Beattie, as guarantor, was indebted to Million Miles in some unknown sum. What must follow on the liquidation of SMD is that the GSA was terminated. While the magistrate did not make a conclusive finding to that effect, it remained a relevant fact when drawing appropriate inferences. If the truck was owned by SMD, as OHTCR contended by reference to the GSA, it was an asset in the liquidation. The probable inference is that SMD, being in default of its taxation obligations (which caused its liquidation) was also in default under the GSA. If SMD defaulted on the GSA, Beattie would be liable to Million Miles on the guarantee and Million Miles, in the event of default, was empowered with substantial rights against SMD in respect of the collateral. It was, amongst other rights, entitled by cl. 15(c) to repossess the truck and receive all its income, transfer the GSA to a third party (cl. 15(d)) , sell the truck (cl. 15(j)), hold possession of the title documents of the truck (cl. 15(k)) and do anything in respect of the truck as it deemed expedient, without limitation (cl. 15(x)). It is also probable that the liquidator recognised the priority claim of Million Miles to the truck as a secured creditor pursuant to the GSA.

70 OHTCR hinted in submissions to the possibility, given that the final date for repayment was 6 July 2018, that Million Miles had been paid out prior to the liquidation. The proposition was not put to the Million Miles witnesses at trial. But it can be dismissed as remote for at least two reasons. SMD could not have earned a discharge of the GSA by repayment of the secured moneys prior to the liquidation, as, because if it had, the liquidator would have been entitled against Million Miles by cl. 9 to the release, discharge, or reassignment of the truck from the operative effect of the GSA, and the truck, later valued by QBE at $66,000, would have been realised in the insolvency of SMD. This possibility can also be discounted because unless the GSA was prematurely discharged by performance, there would be an issue with voidable preference payments. In any event, premature discharge by a financially challenged company seems remote.

71 The probable inference from the agreements is that ownership of the truck, if not always with Million Miles or other companies in the Fred's group (although that conclusion is not attractive), reverted to Million Miles when SMD defaulted under the GSA. Either way, at the commencement of the relevant period, the only available inference on the balance of probabilities was that Million Miles was the owner of the truck and on no basis could Beattie have been the owner.

72 Thirdly, if it were otherwise two facts are inexplicable. First, given the terms of the GSA and the analysis of them by OHTCR on the appeal (set out above) the structure of the GSA necessitated the conclusion that the truck was owned by SMD, then how at the (later) relevant time was Million Miles the owner, and registered as such. Secondly, why was Million Miles noted by QBE as an insured party in respect of the truck.

73 Fourthly, that inference of ownership is consistent with Borg's evidence that he entered into a gentleman's agreement with Beattie, and that Million Miles later, on the magistrate's findings, asserted its ownership of the truck against Vanessa Cross and then OHTCR. However, the evidence did not permit the magistrate to clearly answer what were the terms of the gentleman's agreement. A novation of the GSA from SMD to Beattie would be improbable and there was no evidence that the gentleman's agreement was in any way formal, or formalised. The gentleman's agreement must have been a new agreement and its proper construction cannot be aided by analysing the GSA. There was no evidence that would have permitted the magistrate to conclude that Beattie was obligated to Million Miles in the terms of the GSA or that, correspondingly, he was entitled to any benefits under it. All that the GSA could establish was that Beattie was a defaulting guarantor of the obligations of SMD crystallised by its liquidation.

74 In all of the circumstances identified in the evidence before the magistrate, by the gentleman's agreement Borg allowed Beattie to retain possession of the truck to continue to use it in discharge of the obligations to Interstate Transport to work the truck under the Contractor and Tow-Haulage Agreement in order to earn revenue. It was not possible to say that the arrangement included any waiver of Beattie's obligations as guarantor or a transfer of title to the truck. Consequently, there is no basis to consider the contentions advanced on the appeal that the terms of the GSA defined the issue of ownership of the truck. They were irrelevant. The only probable inference was that Beattie was in possession of the truck after the liquidation by reason of some licence from Million Miles, what was called the gentleman's agreement. Beatie's interest in possession is consistent with all that subsequently happened up to the time of his death.

75 It also follows that OHTCR's submissions about the nature and extent of Beattie's debt to Fred's Transport following the gentleman's' agreement are irrelevant and need not be further analysed, except in connection with the loss claim.

76 The magistrate was entitled to be satisfied on the balance of probabilities that Million Milea owned the truck because there was evidence before the magistrate that:

(a) Million Miles was the registered owner of the truck at the relevant time;

(b) Million Miles was noted on the insurance for the truck as an insured as was Beattie;

(c) Beattie was in possession of and entitled to use the truck to work for Fred's Transport by reason of a gentleman's agreement with Million Miles;

(d) After the accident, Beattie needed a repaired roadworthy truck to continue to do that;

(e) Beattie had access to repair/mechanical services for the truck through Fred's Transport;

(f) The truck was not repaired when Beattie died;

(g) Vanessa Cross appeared to be in possession of the truck after Beattie died;

(h) Million Miles demanded the return of the truck from Cross when Beattie died;

Significantly, the magistrate did not accept the evidence, and rejected submissions, that:

(i) Beattie made an agreement for the repair of the truck with OHTCR;

(j) Beattie delivered the truck into the possession of OHTCR prior to his death;

(k) Vanessa Cross had any rights in respect of the truck; and

(l) OHTCR did any repair work on the truck prior to Beattie's death, prior to the demand by Million Miles for the truck, or at all.

77 The magistrate was entitled to weigh up the whole of the evidence before her. Had she done so as I have, she would not have reached a different conclusion, although her reasoning may have been differently expressed. That said, I reject the submission for OHTCR that the magistrate reversed to onus of proof by expecting that OHTCR needed to rebut a presumption arising from the fact of registered ownership. It was misconceived to submit that the pleaded obligation was to prove ownership at all material times from 2003 and that the magistrate held that Million Miles was relieved of its obligation to prove ownership when OHTCR declined to pursue its positive defence based on an agreement with Cross. OHTCR's submission that the GSA required that the magistrate reach a different conclusion has been already dealt with.

78 The circumstances of the insurance payout were not explained in evidence, save that the documents show the broker and the insurer dealing with Beattie to the exclusion of Million Miles. The probable inference is that Beattie received the whole of the insurance payout, that is, the cash settlement and the wreck, but the circumstances were not such as would permit a finding that the conduct of the insurer in any way effected a transfer of title to the truck from Million Miles to Beattie. Rather, questions arose as between Beattie and his co-insured, Million Miles as to whether the insurance proceeds were properly accounted for by Beattie and such questions were not raised before the magistrate in a manner that permitted resolution. The evidence was that the dealings were not disclosed to Million Miles. In respect of title to the truck, no inference of any change could have been drawn from the payout. The consequence was that Vanessa Cross and OHTCR, whose claims were derivative through Beattie, did not show any basis to displace the primary inference of ownership by Million Miles.

79 OHTCR also submitted that if the magistrate was satisfied that Beattie was entitled to possession of the truck, applying Simonson Properties, ownership of the truck was established by that finding. I do not accept this submission. In that case the issue was whether Hardy held title to the right to display a NSW licence plate on trust for Simonson Properties. Physical possession and control of the display of the number plate were important to the court in concluding that possession, together with paying registration and other fees associated with the exercise of the right to display, were consistent with an assertion and enjoyment of absolute ownership of the right by the person who gifted it to Hardy to display. Although the judge cited the passage from Cross, set out above, neither his Honour's exposition of legal principle nor his factual findings assist in resolving the present case, save to note that the court carefully examined all of the evidence when drawing the inferences as to ownership that determined the outcome.

80 The difficulty for OHTCR with this submission was that Beattie's possession of the truck followed on from the gentleman's agreement, as previously discussed, and must be understood in the context of that agreement, which lent colour to the fact of possession. It did not, as OHTCR submitted, flow from the GSA for the reasons already discussed. I am not persuaded that the magistrate erred in not determining from Beattie's possession of the truck that he was the owner of it. In the circumstances, Beattie's possession of the truck was consistent with his agreement to perform contractor services for Interstate Transport and did not establish that he was its owner.

81 For these reasons, the magistrate correctly concluded that Million Miles was the owner of the truck, entitled to possession of it from the date of Beattie's death, which must be taken to have terminated any licence from Million Miles that entitled him to possession. It may be that in some respects the magistrate's reasoning fell short, but I am satisfied that the ultimate finding of the court was correct. It follows that Million Miles was entitled to demand the return of the truck to it.

82 The next issue was whether OHTCR was entitled to a repairer's lien and to possession of the truck until paid. The parties agreed that the relevant principles were identified by the High Court in _Dinmore Meatworks Pty Ltd v Kerr,[13]_describing the lien in these terms:

It is a long established principle that if a chattel be delivered to a man so that he may for reward do work upon it, as for example by repairing or altering it or making something of it, he may, having completed the work retain possession of it until he has been paid for his work.

...

It is a possessory lien, and it is a particular lien. To say that it is a possessory lien means that, apart from any statutory extension of his common law rights - the lienee's only right is to keep possession of that article until he is paid for his work on it. If he voluntarily surrenders possession of it to the owner his lien is lost.[14]

83 Earlier, in Fisher v Automobile Supply Co,[15] the High Court stated that the lien only arises when 'the work in respect of which the charges arose was done by the order at the request of the owner or some person authorized by him'. It may be accepted that such authority may be inferred.

84 The magistrate was correct in concluding that there was no repairer's lien in favour of OHTCR based on the findings of fact that:

(a) The magistrate rejected Jerry Brown-Sarre's evidence of an agreement between Beattie and OHTCR that the latter repair the damage to the truck from the accident in 2019.

(b) The magistrate could not be satisfied how the truck came into the possession of OHTCR or that it did so prior to Beattie's death.

(c) The magistrate could not be satisfied that following Beattie's death any person other than Million Miles could authorise the repair work.

(d) There was objective evidence about the truck that, at the least, warranted inquiry whether it was owned by Fred's Transport.

(e) The magistrate was not satisfied that the truck was delivered into the possession of OHTCR prior to early September 2020 when Borg demanded its return and OHTCR, via Scott Brown-Sarre offered to buy it from Fred's Transport.

(f) The magistrate was not satisfied that the truck was repaired. Her Honour accepted that a new bull bar was fitted and the truck was resprayed and each of those events appeared to take place after OHTCR was expressly aware of the interest of Million Miles.

(g) To the extent that the magistrate was satisfied that some work was done on the truck, her Honour was entitled to conclude that OHTCR was refurbishing the truck for its own purposes.

(h) The magistrate rejected the 'invoice' relied on by OHTCE as contrived, and neither that document nor any of the supporting documents produced by OHTCR bore the appearance of legitimate business records.

(i) OHTCR never sought payment of the 'invoice' from OHTCR and brought no counterclaim. Rather it asserted that it was entitled to retain the truck. Million Miles was required to enforce compulsory court process to obtain a copy of the 'invoice' and to inspect the truck.

85 There was no error in the magistrate's conclusion that OHTCR had not established a repairer's lien in respect of any sum and that Million Miles was entitled to possession of the truck.

86 I accept the contentions of Million Miles that there is no merit in OHTCR's submission that it was denied procedural fairness by the prosecution of an unpleaded allegation of fraud. The magistrate's findings are correctly characterised as adverse credit findings that were based in the way that OHTCR presented its case, particularly its documentary evidence, and did not flow from a primary allegation prosecuted by Million Miles such as, for example, that OHTCR was committing 'invoice' fraud.

87 In relation to ground 7 concerning the assessment of the damages awarded to Million Miles, the initial issue is that there was no evidence that would have permitted the proper quantification of any loss suffered by Million Miles. Broadly, the evidence suggested that the truck earned revenue for the Fred's Transport group through financing truck operators enabling use of vehicles provided by the group and that it earned revenue through freight and haulage operations.

88 The reasonable inference open on the evidence was that Million Miles was an asset holding company. It financed the purchase of the truck by SMD and presumably contributed to the revenue of the Fred's Transport group through that activity. So much was clear from the GSA, and it was open to infer that Million Miles received revenue under the GSA until SMD defaulted and was liquidated. No finding was made about any liability on the part of Beattie to make any financing payment, and if so in what sum, for the acquisition or use of the truck. As I have explained, if there was such an obligation it arose as part of the gentleman's agreement, not the GSA.

89 The magistrate's finding was that she accepted Borg's evidence that 'the vehicle would have earned income in the Fred's fleet in the normal cartage of goods'. No finding was made, nor on the evidence could possibly have been made, of loss of income by Million Miles under the gentleman's agreement in the form of income from financing the possession by Beattie of the truck. The evidence before the court was that income from the normal cartage of goods was earned by Interstate Transport Pty Ltd. The Contractor and Tow-Haulier agreement between SMD and Interstate Transport must have terminated when SMD was wound up (see cl. 2.12) but there was no evidence that the gentleman's agreement novated to Beattie the benefits and obligations of SMD under that agreement. The terms of that arrangement were not put in evidence in any sufficient detail.

90 It must follow that there was no evidence before the magistrate that Million Miles had sustained any loss, beyond the available, but insufficient, inference that OHTCR had unlawfully detained an asset capable of producing income. It was clearly open to Million Miles to quantify its damages by leading evidence about any agreement between it and Beattie for payment of a fee for the use of the truck following the termination of the GSA, or whatever else may have been agreed between them. Equally, it was open to Borg to ensure that the Fred's Transport group company entitled to receive revenue from the use of the truck for freight or tow haulage (probably Interstate Transport Pty Ltd) was a co-plaintiff that proved its loss by production of appropriate agreements with Beattie and financial records about the conduct of that relationship up to the time of that accident. There was no evidence of what the Fred's Transport group would have done in the counterfactual scenario in which it regained possession of its truck in an unroadworthy condition without an allocated driver. These were not matters for speculation. These matters also could have been the subject of evidence.

An appeal court will be hesitant to interfere with an award of damages because such awards are not ordinary findings of fact but rather a matter of speculation, estimate, uncertainty and commonsense: Davies v Powell Dufryn Associated Colleries Ltd [1942] AC 601 at 616. Or alternately "unsusceptible to entirely logical exposition" Southgate v. Waterford (1990) 21 N.S.W.L.R. 427 at 441-442.

However, this is not the applicable principle. The general rule is that damages for torts or breach of contract are assessed as at the date of breach or when the cause of action arises. But this rule is not universal; it must give way in particular cases to solutions best adapted to giving an injured plaintiff that amount in damages which will most fairly compensate him for the wrong he has suffered.[16]

92 The party who asserts that it has suffered a loss must prove it and must also prove the causal link between the wrong and the loss. Both the evidentiary and the substantive burden of proof of loss and causation lay, in this proceeding, upon Million Miles. It was no answer to say Million Miles was permitted by the ATO to conduct its relations with them as a group and accordingly it need not identify the precise corporate entity entitled to receive revenue under an assumed agreement, arrangement or understanding with Beattie about the use of the truck, when Million Miles, Borg, and his legal representatives were obviously able to identify the proper plaintiff, the appropriate counterfactual and the quantum of any loss.

93 There was no scope, in this context, to retreat to the notion that the court must do the best that it can with the evidence adduced before it notwithstanding uncertainty because its duty is to resolve lawfully and justly contested issues. This was not a case of inherent uncertainty in the assessment of loss, it was a straightforward application of the burden of proof. Uncertainty was caused by the absence of relevant evidence. The principle applicable is that the assessment of damages should be resolved adversely to the party who could and should have called that evidence.[17]

94 It follows that I am satisfied that ground 7 - that the magistrate assessed the plaintiffs damages without evidence to support the assessment of loss - must be upheld, although not for the reasons articulated by OHTCR. Rather, the magistrate could not have been satisfied on the evidence that it was Million Miles that was losing $8,000 per month because the truck was 'not on the road'. I add that it was not in my view open to OHTCR to submit that there was a failure by Million Miles to mitigate its loss by paying $28,781.50 to OHTCR to secure the release of the truck for many reasons, not the least of which was that it neither pleaded failure to mitigate or ran that defence before the magistrate.

95 Further, in the exercise of my discretion, I decline to make any order that the sum of $4,268.00 that the magistrate ordered be set off against the damages awarded be recovered. I am not persuaded that the evidence supported the proposition that the bull bar was fitted by any authority from Million Miles and was probably fitted by OHTCR intending to refurbish the truck for its own purposes.

97 The appellant has not persuaded me that there is any prospect that it could establish that the respondent was not the owner of the truck or that, if it was, it was entitled, as against the respondent, to possession of it by reason of a repairer's lien. I am satisfied, for the reasons I have expressed, that the magistrate's conclusion that the respondent was entitled to possession of the truck was correct. I am also satisfied that the magistrate's conclusion that the appellant failed to prove that it repaired the truck and that the inference that it refurbished the truck for its own purposes was open. The appellant failed to prove that it was authorised by any person to work on the truck for reward.

98 The respondent failed at trial to prove either that it had sustained a quantifiable loss through the appellant's unlawful detention of its truck or that it was entitled to damages for the loss of use of the truck in contractor or tow haulage operations. Whether some other corporate entity related to the respondent is entitled to damages in that context is not a matter before the court.

99 I am empowered by s 109(6) of the Magistrates Court Act 1989 (Vic), after hearing and determining an appeal, to make such order as I think appropriate, including an order remitting the case for re-hearing. In the exercise of my discretion, having regard to the overarching purpose of civil litigation as stated in the Civil Procedure Act 2010 (Vic), the judgment of the court will be:

(a) The appeal is allowed and the orders of the Magistrates Court of Victoria sitting at Shepparton, made on 15 December 2022 are set aside.

(b) The appellant must deliver up the truck to the respondent at the Fred's Interstate Transport depot at 500 Midland Highway, Shepparton, in the State of Victoria forthwith and by no later than 4:00pm on 22 September 2023.

(c) The respondent's claim in the proceeding below is otherwise dismissed.

100 Costs, including the costs before the magistrate, are reserved for further submissions.

[1] [1970] VicRp 63; [1970] VR 476, 478.

[2] [2015] VCAT 295.

[3] Citing Kostas v HIA Insurance Services Pty Ltd t/as Home Owners Warranty [2010] HCA 32; (2010) 241 CLR 390, 418 [91]; S v Crimes Compensation Tribunal [1998] 1 VR 83, 90; and CD v Central Gippsland Health Service [2022] VSC 462, [271].

[4] Linfox Australia Pty Ltd v Transport Accident Commission [2016] VSC 592, [35].

[5] [2022] WASCA 134, [110].

[6] [2022] FCA 316, [78].

[8] [1962] HCA 47; (1962) 108 CLR 628, 632.

[9] Compare Stoker v Picken (2012) 297 ALR 747.

[10] Ritter v North Side Enterprises Pty Ltd (1975) 123 CLR 301.

[11] Evidence Act 2008 (Vic) s 140(2)(c); Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336.

[12] Unity Insurance Brokers Pty Ltd v Rocco Pezzano Pty Ltd (1998) 192 CLR 603, 654 [134].

[13] [1962] HCA 47; (1962) 108 CLR 628.

[15] [1928] HCA 35; (1928) 41 CLR 167, 174.

[16] Johnson v Perez [1988] HCA 64; (1988) 166 CLR 351.

[17] LMI Australasia Pty Ltd v Baulderstone Hornibrook Pty Ltd [2003] NSWCA 74, [12]; Amcor Ltd v Barnes [2016] VSC 707, [1046]; Wilson v Bauer Media Pty Ltd [2017] VSC 521, [163]; Bannon v Nauru Phosphate Royalties Trust [2018] VSC 532, [238].