16 The existence of a custom or usage which justifies the implication of a term into a contract is a question of fact: Nelson v Dahl (1879) 12 Ch D 568, at 575; Con-Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Australia) Ltd (1986) 160 CLR 226, at 236. There must be evidence that the custom is so notorious and acquiesced in that everyone entering into a contract of that kind can reasonably be presumed to have imported the term into the contract: Con-Stan (ibid); Majeau (supra) at 60-61; Nelson v Dahl (supra) at 575.
17 Mr Tannous submits that a particular lien is implied in towing contracts by custom or usage, the dealings establishing that custom or usage being those between towing operators as a body and motor vehicle insurers as a body.
18 Mr Tannous acknowledges that the towing contract, as embodied in the towing authorisation prescribed under the Regulations, is a contract, not between the towing operator and an insurer but, rather, between the towing operator and the owner of the vehicle. He concedes that there is no evidence which would establish a custom or usage arising from dealings between towing operators and motor vehicle owners.
19 However, Mr Tannous submits that the Court will take judicial notice of the fact that the vast majority of motor vehicles are insured and that, when a motor vehicle involved in a collision requires to be towed, the owner's insurer will invariably become subrogated to the owner's rights. In that situation, Mr Tannous says, the insurer stands in the shoes of the owner and negotiates payment of the towing charge and the release of the vehicle by the towing operator. Accordingly, he says, the owner is represented by the insurer so that a custom or usage as between the insurance industry and the towing industry is to be implied into all towing contracts.
20 I am unable to accept this submission. As shown by the evidence of Mr Willis, an experienced towing operator called by the Defendant, there are many cases in which towing charges for a vehicle will not be covered by insurance. Such cases include those in which the vehicle is not involved in a collision but simply breaks down on the road. In those cases, no custom or usage between insurers and towing operators could imply a lien into the towing contract because the contract is between the owner and the towing operator alone, and an insurer has no part to play in its performance.
21 The evidence does not establish what proportion of towing contracts made in this State involve an insurer. In order to justify the implication of a term in a generic contract in an industry, a custom or usage must be shown to be "uniform" in the relevant industry. "Uniform" does not mean "universally accepted", but the exceptions must be shown to be rare: Nelson v Dahl (supra) at 575; Con-Stan (supra) at 236.
22 The onus of establishing a uniform custom or usage falls upon the party asserting it. The Defendant has failed to show that towing contracts in this State "uniformly" involve insurers. Accordingly, the custom and usage of insurers cannot affect the terms of towing contracts generally, even if the terms of payment by insurers under towing contracts on behalf of owners were capable of importing a term into the towing contracts after they were made - a highly questionable proposition.
23 Further, in those cases in which the owner's towing charges under a towing contract are covered by an insurance contract, the insurer's obligation would usually be merely to indemnify the owner for the expenses incurred. I am unable to find that motor vehicle insurance contracts in New South Wales uniformly, or even generally, appoint the insurer as agent of the owner to enter into towing contracts. There is no evidence to that effect. Accordingly, even in contracts in which insurers are involved, I cannot find that the insurers have entered into such contracts on behalf of the owners so that the insurers' knowledge of, and acquiescence in, a custom or usage justifies the implication into the contracts of a term conferring a particular lien.
24 For these reasons, I am unable to find that dealings between the towing industry and the motor vehicle insurance industry could import, by custom and usage, a term for a lien in towing contracts between owners and operators.
25 For the sake of completeness, I should state my findings as to whether the evidence proves the custom or usage asserted.
26 Mr Tannous submits that the motor vehicle insurance industry has for some time acquiesced in the practice that towing operators would not release a motor vehicle unless paid at the time of release. From such a practice, Mr Tannous says, it can be inferred that the motor vehicle insurance industry acknowledged that towing operators were entitled to a possessory lien. The evidence does not support that submission.
27 Mr Hickey, who was appointed as General Manager of the TTA in July 2001 and is now General Manager of the Tow Truck Licensing and Compliance Board of the RTA, says that there has been a continuing debate between motor vehicle insurers and the tow truck industry for years over whether towing operators have a possessory lien. He says that the existence of such a lien is not commonly accepted by insurers.
28 Mr Hickey says that a number of insurance companies have special arrangements with particular towing operators regarding time for payment of towing charges. There are some insurers who, by agreement, pay the towing operator after, not at the time of release, of the towed vehicle.
29 Mr Hilder, who is the State Assessing Manager of AAMI, says that in the majority of cases when an insured's vehicle is taken to an AAMI customer service centre by a towing operator, the operator's towing charge is paid by cheque upon delivery of the vehicle. This is a matter of administrative convenience for AAMI, not because AAMI recognises that the operator has a possessory lien. He says that he is not aware of any direction by AAMI to its staff to the effect that towing operators have a lien on the towed vehicle and, for that reason, must be paid before the vehicle will be released by the operator to AAMI or the owner.
30 Mr Hickman, the Theft and Investigation Manager of AAMI responsible for tow truck claims, confirms the evidence of Mr Hilder to the effect that AAMI, as a matter of administrative convenience, generally pays the towing operator upon delivery of the vehicle to an AAMI customer service centre. He says, however, that AAMI has disputed operators' claims for a lien. He gives a number of instances when AAMI did not agree that a towing charge had been reasonable but paid the charge under protest and then commenced proceedings in the Local Court to recover part of the payment.
31 Mr Willis is a towing operator and has been involved in the industry for thirty-three years. He is now the controlling director of a substantial towing company. Mr Willis says that he has always had a practice of informing uninsured drivers before accepting a contract to tow their vehicles that he will require payment upon completion of the tow. He says that if an owner does not agree to this term, he will not accept the towing engagement.
32 It is clear that, as far as Mr Willis' own experience is concerned, payment of the towing charge before release of the towed vehicle is made an express term of the towing contract with the owner and is not, therefore, implied by custom and usage.
33 Mr Willis says that in about 2000 he was involved in a major dispute with the NRMA over the time taken by it to pay towing charges for insured vehicles. Mr Willis insisted on retaining a substantial number of vehicles until the towing charges were paid. The NRMA disputed his right to retain them. It is clear from the very existence of such a dispute that there was no uniform acknowledgement in the motor vehicle insurance industry at that time that a towing operator had a possessory lien over towed vehicles.
34 Mr Willis says that, ultimately, the NRMA capitulated and entered into a special agreement with his company for the payment of towing charges. He says that his company has, since then, entered into special contracts with other major motor vehicle insurance companies.
35 Mr Willis' evidence undermines the proposition that the motor vehicle insurance industry has uniformly acknowledged, by custom and usage, the right of a towing operator to a possessory lien. His evidence is, in short, that the right to a possessory lien was disputed and that the dispute has led to special contracts as to terms of payment with particular insurance companies. The existence of special contracts between some members of the motor vehicle insurance industry and towing operators cannot create a custom or usage applying to the whole industry.
36 I hold, therefore, that the Defendant has failed to prove that the motor vehicle insurance industry and the towing industry have, by custom or usage, uniformly acknowledged the right of a towing operator to a possessory lien.
37 In the light of these conclusions, I cannot find that the right to a possessory lien is to be implied in a towing contract by reason that it is necessary to give business efficacy to the contract and is so obvious that it goes without saying: cf. BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1978) 52 ALJR 20, at 26.