Reavill Farm Pty Limited v AR Mortgages Pty Ltd [2020] NSWSC 884 | Case summary

Consideration

In my view, Matthew Champion has not established ownership of the cattle, the subject of his motion. Nor has Tucki Hills established ownership of the cattle, the subject of its motion. I have thus decided the questions against Matthew Champion and Tucki Hills.
The key to that outcome is that, other than the say-so of Matthew and Jeffrey Champion and some documents that they created or say exist, there is no evidence that any of the cattle were ever owned by Matthew Champion or Tucki Hills.
On the other hand, previous valuations and estimates as well as statements made by Jeffery Champion, in addition to other evidence adduced by the defendant, tends to suggest that the cattle, the subject of the dispute, must have formed part of the security offered to the defendant by the plaintiff pursuant to the GSA.
As may be expected, the number of cattle comprising the secured livestock was the subject of an agreement between the plaintiff, through Jeffrey Champion, and the defendant.
In his affidavit affirmed 2 October 2019, Jeffery Champion stated that there were 352 livestock owned by the plaintiff (and as such, the subject of the security).
The livestock have also been subject to two valuation reports by Slattery Asset Advisory ("Slattery"). At the time of the second valuation on 9 September 2019, Slattery estimated the number of livestock owned by the plaintiff as being 366.
Only 291 cattle have ever been recovered by the defendant. That figure includes cattle removed from the land owned by Tucki Hills on Hazlemount Lane, Tuckurimba, near Lismore ("the Tucki Hills property").
There are four head of cattle (including two bulls) remaining on the Tucki Hills property.
Jeffery Champion suggested in cross-examination that the defendant had obtained a further report from Slattery with a reduced estimate of the number of secured livestock and that the defendant was hiding that report. The basis of this belief is unclear. No evidence was adduced to support this assertion.
Tucki Hills and Matthew Champion contend that the defendant has taken possession of cattle not part of the secured livestock. It is asserted that the defendant wrongfully entered the Tucki Hills property and stole Tucki Hills' cattle as well as cattle owned personally by Matthew Champion.
The circumstances in which the defendant entered upon the Tucki Hills property and removed the cattle are as follows.
During the period from October 2019 to March 2020, 32 head of the secured livestock were sold. However, on inspection of the cattle on the plaintiff's land on 26 March 2020, a head count revealed that only 100 head of cattle remained. 234 were missing.
Inquiries then undertaken by the defendant, including through Anthony Rippon, a stock musterer who had worked with or on behalf of the Champions, suggested that the cattle may have been moved to other blocks of land not owned by the plaintiff but owned by another company associated with Jeffery Champion, being the Tucki Hills property.
Jeffery Champion said in oral evidence that he believed that 150 head of cattle not owned by the plaintiff had been taken. He eventually settled on 120.
It is alleged that the Tucki Hills cattle were intermingled with the secured livestock, although the Tucki Hills cattle was mostly on the Tucki Hills property.
According to Jeffery and Matthew Champion, the discrepancy between the number of secured livestock in October 2019 and the amount recovered is explained by the death of 50 cattle between October 2019 and April 2020. This is not accepted by the defendant.
Even so, according to Jeffrey Champion, 120 of the 291 are owned by Tucki Hills. It is thus said that more than a third of the cattle removed by the defendant were never part of the secured livestock. Assuming that Jeffery Champion's statement in his affidavit of 2 October 2019 is correct, it must be that up to 131 of the secured livestock are still missing.
Neither Jeffery nor Matthew Champion offered any explanation as to the whereabouts of the missing cattle. I apprehend that they assert that the defendant has not accounted for all of the cattle, just as it has hidden another valuation report.
Similarly, the National Vendor Declaration records, said to establish the existence of the Tucki Hills-owned cattle, are said to have been removed by persons unknown.
It is surprising that Matthew Champion did not realise or depose to the fact (if it be the fact) that up to 120 other livestock had been wrongly taken by the defendant. His explanation for why the Tucki Hills motion refers only to 30 head of cattle (rather than the higher figure now claimed) is that when he provided instructions in respect of the Tucki Hills motion, he was not aware that more may be missing or had been taken by the defendant.
He said that it might have been a few days before he was able to carry out an inspection. However, he also said that the cattle were being hand fed by him and that they would be hand fed once every couple of days. Further, no explanation was offered as to why 50 head of cattle might have died over the past few months in circumstances in which there was hand feeding.
Anthony Rippon attended at the Tucki Hills property and recovered the livestock on behalf of the defendant on 5 April 2020. He did not observe the remains of any cattle. There was no smell coming from the land. He did not observe any part of the land that might have been used to bury the cattle.
Similarly, Ailsa Dunsford, an employee of the defendant, had attended at the land to inspect the cattle and did not observe any dead cattle.
In circumstances in which Matthew and Jeffrey Champion were disputing ownership of the cattle and were apparently hand feeding the cattle, it seems improbable that 50 head of cattle would have died. It is even more improbable that all of those cattle would have been buried without any trace of that happening on the land.
The proposition that 120 livestock or any significant number of cattle belonging to Tucki Hills were wrongfully removed is quite contrary to the earlier valuations and statements.
Indeed, the proposition that Tucki Hills owned any livestock in 2019 is disputed by the defendant. It was accepted by Matthew Champion during cross-examination that he had produced only one document, being an unsigned financial statement for 2017-2018, which would support ownership of any cattle by Tucki Hills.
The defendant's position is supported by Mr Rippon, who has done work for Matthew and Jeffrey Champion over the past approximately five years. This involved scanning the national livestock identification system tags to give a record of movement of livestock. In his affidavit, he says that in those five years, he recalled only one mention of Tucki Hills in the context of owning livestock, which was quite some time ago.
Further, all of the cattle were registered to the plaintiff by way of the plaintiff's PIC (NJ534510) until such time as Tucki Hills registered its own PIC in October 2019.
Matthew Champion says that the PIC is not evidence of ownership but evidence of where the cattle are kept. On that basis, it must follow that Tucki Hills only needed its own PIC when it commenced raising its own cattle on its land in October 2019. This would seem to be during the same period as a significant quantity of livestock disappeared from the plaintiff's property.
Other than statements of Jeffrey and Matthew Champion, there is little to support the applications.
Jeffery Champion acknowledged that, despite apparently running a cattle business, Tucki Hills did not keep records. It has no records of purchase of the cattle.
Matthew Champion states that: 1. the Slattery valuation is incorrect and known to be incorrect by the defendant, which is withholding another report; 2. the inspection undertaken by Slattery did not include lots 3 and 4 owned by Tucki Hills, such that the estimate could only include livestock on the plaintiff's land. The livestock on the Tucki Hills property would not be included in the estimate and Jeffrey Champion's estimate similarly would not include livestock on the Tucki Hills property. As such, earlier estimates of the number of secured livestock are irrelevant as they did not include cattle owned by Tucki Hills on the Tucki Hills property; 3. the plaintiff's cattle were Charolais-Cross and the Tucki Hills cattle were pure Charolais. As such, any pure Charolais taken by the defendant belonged to Tucki Hills; and 4. based on the sales evidence produced by the defendant, many of the calves are missing. The defendant has not accounted for those calves. Matthew Champion believes that the defendant has moved the calves somewhere else.
Finally, Tucki Hills relies on sale records, which include sales by Tucki Hills of nine head of cattle originating from a PIC holder other than the plaintiff. This is said to support the proposition that Tucki Hills must have been raising and trading cattle contrary to the defendant's assertion.
The effect of the evidence and submissions relied on by both Matthew Champion and Tucki Hills is really that the defendant has taken cattle to which it had no entitlement; it is now hiding relevant documents; it is not accounting for cattle which it must have and it wrongfully failed to comply with court orders.
There are a number of difficulties with the evidence adduced by Tucki Hills and Matthew Champion in support of their applications.
Firstly, despite allegedly being involved in the cattle farming business prior to 2019, Tucki Hills only registered a PIC in October 2019. New tags were placed on some of the cattle at that time. Establishing that some of the cattle taken by the defendant had a Tucki Hills PIC is hardly evidence of ownership when the PIC was registered and tags inserted after the dispute with the defendant arose and indeed after orders were made.
Secondly, other than the 2017-18 Tucki Hills financial statement, documentary evidence relied upon through Matthew Champion does not assist Tucki Hills. There are many sales invoices from George and Furhmann stock agents but most relate to sales prior to 2012. There is a gap in sales up to 2020.
Thirdly, the 2017-18 financial statement for Tucki Hills does record that it owned livestock to the value of $157,000 at that time. This is said to establish that Tucki Hills did own a significant quantity of livestock in 2019. As there is no other explanation for the disappearance of this livestock, this is said to be support for the proposition that the defendant wrongfully took a significant quantity. Matthew Champion relied on these "tax returns" in his evidence.
He agreed that they were prepared by his sister, Ms Nott, who was an accountant. He maintained ignorance of the conviction of Ms Nott relating to preparation of false documents.
No tax returns were produced and there is no evidence before me that any were ever filed. There is no evidence that the financial statements were signed or lodged with ASIC.
Matthew Champion expressly adopted the financial statement as being the only document verifying ownership by Tucki Hills of livestock in 2018. No other financial statements were produced.
If Tucki Hills was engaged in the business reflected in the financial statement for 2017-18, it would have been required to lodge tax returns. If there were tax returns, I would have expected them to be produced, particularly as the fact that the "statements" were not tax returns was taken up in cross-examination. Ms Nott was not called. I do not accept that an unsigned document, allegedly prepared in 2018, which was not filed with ASIC, is evidence of ownership of a significant quantity of cattle in 2020.
Fourthly, Matthew Champion's evidence that Tucki Hills had only owned pure Charolais and not Charolais-Cross was similarly accepted by him as not being accurate based on earlier records, just as he also accepted in cross-examination that his estimate of the number of pure Charolais was incorrect.
There is an issue between the parties as to whether the defendant complied with the Court's orders in respect of scanning of the cattle prior to removal from the land. Mr Rippon accepted that he was not instructed to scan the cattle prior to removal. He said there were difficulties put in his way in any event.
On behalf of Tucki Hills, Mr Williams submitted that earlier court orders required the defendant to scan the cattle prior to removal; as it did not do so, the defendant was the wrongdoer. The defendant disputed this, asserting that the orders permitted it to scan rather than required it to scan.
Mr Williams submitted that it was only necessary for Tucki Hills to demonstrate that even one head of cattle had been wrongly removed by the defendant for the onus to shift to the defendant. Mr Williams pointed to the fact that there were six head of cattle with a PIC registered to a third party. He submitted that this meant that not all of the cattle taken by the defendant could have belonged to the plaintiff. That being established, he said, the onus shifted to the defendant to prove it was entitled to take all of the other cattle.
I do not accept that submission. Firstly, I do not accept that the reference to a third party PIC number necessarily establishes that maintained by Mr Williams.
Importantly, there is no shifting onus. Both applicants seek orders to the effect that they should either have cattle returned to them or receive damages from the defendant. I reject the submission that the onus rests on the defendant to demonstrate that it did not remove cattle owned by Tucki Hills.
In the end, there is an absence of documentation supporting the orders sought in the motions and there is credible evidence weighing against the making of such orders.
I would need to be satisfied as to the truth and accuracy of the evidence of Matthew and Jeffrey Champion to find in favour of Tucki Hills.
I did not find either Jeffrey or Matthew Champion to be credible witnesses. Their evidence was demonstrated to be inaccurate and improbable. I do not accept Matthew Champion's assertion that there are other documents he could locate, which he has not produced, that would corroborate his claims. The evidence that 50 cattle died when they were being hand fed seems unlikely. Matthew Champion's evidence that he did not realise that so many other cattle had gone missing until after he filed his personal motion, in which he claimed only 15 cattle, is not credible.
I do not accept the statements of Jeffrey and Matthew Champion as to the number of cattle owned by Tucki Hills that is said to have been wrongfully taken by the defendant. The statements they have made at differing times have been shown to be inconsistent and inconsistent with each other.
I accept Mr Rippon's evidence about the cattle.
In the circumstances, Tucki Hills has not established that it owns or has any entitlement to possession of any of the cattle now in the possession or formerly in the possession of the defendant.
Matthew Champion's personal application fails for similar reasons.
I do not accept that he has established any entitlement or right to the 15 head of cattle. His claim is based on the proposition that he personally raised these cattle in a yard, which he personally tended to, and the cattle would not be alive or on the land if not for him. He may be able to identify each head of cattle by name and may consider them important but that is not proof of ownership.
He says that one third of the 15 cattle were each located on different blocks of land, 5 of which were on the Tucki Hills property. However, he has not adduced any evidence of an agreement to transfer ownership of the cattle from the plaintiff to him. He accepts that the 15 cattle were registered under the plaintiff's PIC but says that fact does not establish ownership.
He says that he has owned and sold cattle personally in the past. He says that there are calves owned by him which were taken and have not been accounted for. Describing the cattle and emphasising his relationship with them does not lead to a finding of ownership on his part. Further, in circumstances in which I have not found him to be a credible witness, his statement that he owns the cattle would hardly suffice.

Reavill Farm Pty Limited v AR Mortgages Pty Ltd

At a glance

Court

Decision date

Before

Source

Judgment (6 paragraphs)

Parties

Legislation Cited (1)

Cases Cited (2)