High Court of Australia|1994-04-13|Before: Gaudron JJ, Lee J, Young J, Dawson JJ

Wallis v Downard-Pickford (North Queensland) Pty Ltd [1994] HCA 17; (1994) 179 CLR 388; (1994) ATPR 41-300; (1994) 120 ALR 440; (1994) Aust Torts Reporter 81-269 (13 April 1994)

WALLIS v DOWNARD-PICKFORD (NORTH QUEENSLAND) PTY. LTD.

[1994] HCA 17; (1994) 179 CLR 388

DEANE(1), DAWSON(1), TOOHEY(2), GAUDRON(2) AND McHUGH(3) JJ

Constitutional Law (Cth) - Inconsistency between Commonwealth and State laws - State law limiting liability of carriers for loss of or injury to goods - Commonwealth law implying warranty into contracts that services will be rendered with due care and skill - Whether warranty carries full contractual liability for breach - The Constitution (63 and 64 Vict. c. 12) s. 109 - Carriage of Goods by Land (Carrier's Liabilities) Act 1967 (Q.), s. 6(1) - Trade Practices Act 1974 (Cth), s. 74(1).

Trade Practices - Consumer protection - Implied warranty that services will be rendered with due care and skill - Exclusion of warranty where services provided under contract for transport of goods for purpose of occupation of consignor - Contract for transport of police officer's possessions to new post - Trade Practices Act 1974 (Cth), s. 74(1), (3)(a).

Set aside in order of the Court of Appeal of Queensland and in lieu thereof order that the appeal to that Court be dismissed with costs.

DEANE AND DAWSON JJ Subject to one qualification, we agree with the

2. The qualification relates to their Honours' reasons for the

conclusion that the contract in the present case was not excluded from

the operation of s.74(1) of the Trade Practices Act 1974 (Cth) for the

reason that it was a contract of the kind referred to in s.74(3)(a)

of the Act. We agree with that conclusion. However, we do not think

that it is helpful in the present case to ask whether the contract

was "entered into as an ordinary incident of the carrying on of (a)

particular trade, business or profession then being carried on or

proposed to be carried on" ((1) Collins v. Parker, unreported,

Supreme Court of New South Wales, 11 May 1984 at 18 per Lee J; see,

also, Ellison v. Vukicevic (1986) 7 NSWLR 104 at 111 per Young J).

Section 74(3)(a) focuses on the purpose of the transportation itself

and not on the purpose for which the relevant contract was "entered

into". In most cases, no doubt, the distinction will be unimportant.

It does not, however, appear to us to be unimportant in the present

3. In the present case, both the Commissioner and the appellant, at

their different levels, "carried on or engaged in" the "occupation" of

a police officer. The occasion of the transportation of the relevant

goods from Ayr to Dalby was the transfer of the appellant's place of

service from one town to the other. It is, in our view, at least

arguable that the Commissioner entered into the contract with the

respondent "as an ordinary incident" of his occupation as Commissioner

of Police. Nonetheless, it cannot, in our view, properly be said that

the actual transportation itself answered the description of being

"for the purposes of" the occupation of police officer "carried on

or engaged in" by either the appellant or the Commissioner. If the

transportation had been of police property and equipment used in the

course of the discharge of police duties, the transportation might

well have been seen as answering that description. The transportation

was, however, of the appellant's furniture and personal effects. The

purpose of it was to remove the private property of the appellant and

his family from their former family home in Ayr to their new family

home in Dalby. That purpose was a private or domestic one. The fact

that it was the Commissioner, and not the appellant, who entered into

the contract with the carrier pursuant to which the transportation was

effected did not alter the purpose of the transportation itself. The

subjective purpose of the Commissioner may have been to assist the

appellant in changing his family home on the change of his place of

duty. Nonetheless, the purpose of the transportation itself remained

the private or domestic one which we have identified.

TOOHEY AND GAUDRON JJ The appellant is a member of the Queensland

Police Force. The respondent is a "carrier" as that term is defined

by the Carriage of Goods by Land (Carriers' Liabilities) Act 1967 (Q.)

("the Queensland Act") ((2) The Queensland Act was repealed by the

Carriage of Goods by Land (Carriers' Liabilities) Repeal Act 1993 (Q.)

which came into operation on 27 August 1993.). It is also a "trading

corporation" for the purposes of the Trade Practices Act 1974 (Cth).

2. On or about 1 July 1987 the Commissioner of Police entered into a

contract with the respondent for the carriage of the appellant's goods

from Ayr to Dalby, upon the respondent's standard printed conditions.

The contract was for the benefit of the appellant whom the

Commissioner had transferred in the course of his employment. The

appellant's goods were damaged in transit as a result of the

respondent's failure to use due care and skill. The damage was

3. The Supreme Court of Queensland was asked on originating summons

to determine as a question of law whether the appellant could rely

upon ss.68 and 74 of the Trade Practices Act to avoid the limitation

of liability contained in s.6(1) of the Queensland Act. Because the

proceedings took this form it is not possible to say whether the

appellant intended to sue the respondent in negligence, for breach of

an implied term in the contract of carriage, for breach of warranty

implied by the Trade Practices Act, or to rely upon all these causes

of action. The reason for the preliminary proceedings no doubt lies

in s.5 of the Queensland Act which limits the liability of a carrier

to "the bases prescribed by this Act and not otherwise".

" A carrier shall not be liable for loss of or injury to

any goods entrusted to him under a contract of carriage ...

in an amount greater than twenty dollars per package or, in

the case of unpackaged goods, per item of goods consigned

or two hundred dollars per consignment, whichever is the

delivered to the carrier the consignor has given to him a

statement in writing declaring the nature and value of such

goods and has received from the carrier his acceptance in

goods was given to the respondent in accordance with s.6(1) of the

Queensland Act nor was the respondent's acceptance of any increase in

risk obtained pursuant to that section. In consequence, if s.6(1) was

applicable to the contract of carriage, the liability of the

respondent was in the circumstances limited to $200. Section 9(1) of

the Queensland Act deems to be incorporated in every contract of

carriage the provisions of s.6(1) ((3) See Penn Elastic Co. Pty.

Ltd. v. Sadleirs Transport Co. (Vic.) Pty. Ltd. [1976] HCA 28; (1976) 136 CLR 28.).

Section 9(2) makes void any contract purporting to exclude, modify,

5. The appellant argued that the limitation imposed by s.6(1) was

inapplicable by reason of ss.68 and 74 of the Trade Practices Act.

Each of those sections is found in Pt V, Div.2 of that Act which is

entitled "Conditions and Warranties in Consumer Transactions". Those

" 68(1) Any term of a contract ... that purports to

exclude, restrict or modify or has the effect of excluding,

restricting or modifying:

(a) the application of all or any of the provisions of

this Division;

(b) the exercise of a right conferred by such a

provision;

(c) any liability of the corporation for breach of a

condition or warranty implied by such a provision;

or

(d) the application of section 75A;

is void."

" 74(1) In every contract for the supply by a corporation

in the course of a business of services to a consumer there

is an implied warranty that the services will be rendered

with due care and skill and that any materials supplied in

connexion with those services will be reasonably fit for

the purpose for which they are supplied."

6. The Court of Appeal, allowing an appeal from the decision of

Cooper J, held that s.6 of the Queensland Act was effective to limit

the respondent's liability and was not inconsistent with either s.68

or s.74 of the Trade Practices Act. These conclusions assume that the

cause of action to be brought by the appellant would be based on the

statutory warranty implied by s.74. The Court reached its conclusions

essentially because any limitation resulting from s.6 of the

Queensland Act "flows from the operation of that independent statutory

provision and not from any contractual term express or implied". In

the view of the Court, s.9 was no more than "a supplementary statement

whose purpose is to ensure, perhaps out of over-caution, that the

limitation will have contractual standing as one aspect of the

statutory scheme which prohibits contracting out: cf. s.9(2)".

7. Before this Court the appellant did not press any argument as to

the operation of s.9 of the Queensland Act, preferring to base his

case squarely on the scope of s.74 of the Trade Practices Act. The

essence of the submission was that the statutory creation of a

contractual obligation is inherently accompanied by a full contractual

remedy. Section 74, it was submitted, implies into relevant contracts

a term which contains the primary obligation to take due care and

skill and a secondary obligation to provide compensation for breach.

8. In support of this submission, the appellant pointed to

s.68(1)(c) which renders void any term of a contract that purports to

modify a warranty imposed by, among other provisions, s.74. This

provision was said to demonstrate the Trade Practices Act's concern

with liability as well as the creation of rights. Such a provision

was not necessary to override State legislation "because section 109

does that work". The appellant pointed also to ss.73 and 74B which

deem a contractual liability to exist for breach of an implied

warranty in the case of certain persons with whom the consumer does

not have a direct contractual relationship. These submissions have

force. It would indeed be extraordinary if non-contractual parties

had greater rights to recovery than did a consumer who is party to a

contract in relation to which s.74 operates.

9. It follows that the warranty created by s.74 carries with it full

contractual liability for breach. Section 6(1) of the Queensland Act

purports to limit that liability. The consequence is that there is a

conflict between the two statutes, a conflict which amounts to a

direct inconsistency in the sense that the Queensland Act detracts

from the full operation of a right granted by the Trade Practices

Act ((4) Clyde Engineering Co. Ltd. v. Cowburn [1926] HCA 6; (1926) 37 CLR 466 at

478 per Knox CJ and Gavan Duffy J; Victoria v. The Commonwealth

[1937] HCA 82; (1937) 58 CLR 618 at 630 per Dixon J; Ansett Transport

Industries (Operations) Pty. Ltd. v. Wardley [1980] HCA 8; (1980) 142 CLR 237

at 259-260 per Mason J). The limitation is therefore, to that

extent, invalid by reason of s.109 of the Constitution. It is

unnecessary to consider whether, as a separate head of inconsistency,

ss.68 and 74 purport to "cover the field", that is whether they "evince

an intention on the part of the statute to make exhaustive or exclusive

provision on the subject with which (they deal), thereby bringing s.109

into play" ((5) The Queen v. Credit Tribunal; Ex parte General

Motors Acceptance Corporation [1977] HCA 34; (1977) 137 CLR 545 at 563 per Mason J).

10. However, the respondent referred to s.75(3) of the Trade

Practices Act which, it submitted, saved the operation of s.6 of the

Queensland Act. That section is in Pt V, Div.3, which is entitled

" Except as expressly provided by this Part, nothing in

this Part shall be taken to limit, restrict or otherwise

affect any right or remedy a person would have had if this

Part had not been enacted."

11. The argument that s.6(1) constitutes a "right or remedy" within

s.75(3) requires a contrived construction of the provision which, in

our view, goes against the evident consumer protection purposes of the

Trade Practices Act. In any event, s.75(3) cannot resolve a direct

inconsistency attracting the operation of s.109 of the Constitution.

12. This conclusion is sufficient to dispose of the inconsistency

issue but it is desirable to say something about one other matter

which was not pressed at the hearing but which arises from the

judgment of the Court of Appeal and from the authorities. Some

comment on this matter is called for to avoid any misunderstanding as

to the scope of this judgment or the implications to be drawn from it.

13. Although the Court of Appeal held that s.9 was merely a

supplementary provision, it would have been open to the appellant to

contest that view. In Grace Bros Pty. Ltd. v. Rice ((6) (1981) 71

FLR 129.), McCracken DCJ considered the relationship between ss.6

and 9 of the Queensland Act and ss.68 and 74 of the Trade Practices

Act. His Honour held that s.9 incorporated s.6(1) into each relevant

contract so as to constitute a term of that contract within the

meaning of "any term of the contract" in s.68 of the Trade

Practices Act. In support of this position, his Honour referred to

the comments of Stephen J as to the operation of s.6 in Penn Elastic

Co. Pty. Ltd. v. Sadleirs Transport Co. (Vic.) Pty. Ltd. ((7) [1976] HCA 28; (1976)

"(T)he limit of liability attaches to each contract of

carriage; it becomes a term of that contract".

14. Three results follow. Because s.6 is a term of relevant

contracts of carriage, that term is rendered void in each case by the

operation of s.68(1)(c). Further, s.9 itself is impugned in that it

purports to imply into contracts exactly those terms that s.68

forbids. It can therefore be seen as inconsistent with s.68 for the

purposes of s.109 of the Constitution. It is also the case that s.5

of the Queensland Act, which provides that the liability of a carrier

shall be upon "the bases prescribed by this Act and not otherwise", is

invalid under s.109 of the Constitution to the extent that it purports

to preclude the operation of ss.68 and 74 of the Trade Practices Act.

However, the question is not thereby resolved. The finding of the

Court of Appeal was that s.6 has an independent declaratory operation

not dependent on s.9 and this issue is still open.

15. The position in the case of provisions such as s.74 of the

Trade Practices Act which provide for the implication of contractual

terms is less problematic. In Arturi v. Zupps Motors ((8) [1980] FCA 164; (1980) 33

ALR 243 at 246; see also Polgardy v. AGC Ltd. [1981] FCA 26; (1981) 34 ALR 391;

Zaravinos v. Dairy Farmers Co-op. Ltd. [1985] FCA 77; (1985) 7 FCR 195, 59 ALR 603;

speaking of s.71 of the Trade Practices Act, said that the section:

"takes effect by imposing an obligation upon one of the

contracting parties as though the parties had embodied the

obligation in their contract. No doubt it is right to say

that the obligation is statutorily created ... But by

describing the obligation as an implied condition, s.71

defines the nature of the obligation. It is an obligation

which takes effect by a legal fiction, namely, that the

parties had made a contract which included the obligation

... (A) breach of the obligation is not to be treated as a

breach of an obligation imposed upon the obligor by the Act

dehors the contract, but as an obligation imposed by the

contract itself".

But where, as here, the term appears in one section of that Act and

the incorporating provision in another, it is not clear whether they

operate together only or whether each has independent standing.

Because of the way in which the appeal was conducted this issue does

not arise for decision. Nonetheless it may well be that to divorce

s.6(1) from the operation of ss.5 and 9 in the context of an Act

Wallis v Downard-Pickford

At a glance

Court

Decision date

Before

Source

Judgment (300 paragraphs)

Wallis v Downard-Pickford (North Queensland) Pty Ltd [1994] HCA 17; (1994) 179 CLR 388; (1994) ATPR 41-300; (1994) 120 ALR 440; (1994) Aust Torts Reporter 81-269 (13 April 1994)

Parties

Legislation Cited (8)

Cases Cited (17)