V S International Pty Limited v Interior Marble Pty Limited [2005] NSWSC 1142

New South Wales Supreme Court

CITATION : V S International Pty Limited v Interior Marble Pty Limited [2005] NSWSC 1142

HEARING DATE(S) : 25-26/08/05

JUDGMENT DATE : 11 November 2005

JUDGMENT OF : Burchett AJ

DECISION : Order to be made in favour of the plaintiff for conversion of goods.

CATCHWORDS : Bailment by informal loan of equipment - implied promise to return - conduct of bailees amounting to conversion.

Myer Stores Limited v Jovanovic [2004] VSC 478 The Plasycoed Collieries Company, Limited v Partridge, Jones & Co, Limited [1912] 2 KB 345 CASES CITED : Penfolds Wines Proprietary Limited v Elliott [1946] 74 CLR 204 Borden (UK) Ltd v Scottish Timber Products Ltd [1979] 3 All ER 961 Hobbs v Petersham Transport Co Pty Limited (1971) 124 CLR 220

V S International Pty Limited (plaintiff) Interior Marble Pty Limited (first defendant) PARTIES : The Stone Group Pty Limited (second defendant) Mondo Stone Pty Limited (third defendant)

FILE NUMBER(S) : SC 5220 of 2004

M W Sneddon (plaintiff) COUNSEL : A Gemmell (defendant)

Gye Associates Lawyers (plaintiff) SOLICITORS : Bartier Perry (first and second defendants)

LOWER COURT JURISDICTION :

- 14 - IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

BURCHETT AJ

11 NOVEMBER 2005

5220/04 VS INTERNATIONAL PTY LIMITED V INTERIOR MARBLE PTY LIMITED AND ORS JUDGMENT 1 The plaintiff is admitted to have been the owner, "as at the beginning of 2002", of certain stone cutting equipment and other equipment, including one Omec Nouva cross-cut saw and one jib crane ("the equipment"). The equipment was in store and had not been used for some two years. In or about May 2002, it was delivered to premises at Churchill Street, Silverwater which had been acquired for the purposes of a proposed partnership involving the defendant companies. In fact, the partnership came into existence under the name The Stone Group Australia by about early August 2002 and it used the equipment until on or about 20 October 2003, when there was a dissolution of the partnership followed by an appointment on 10 November of a receiver and manager. Since then, the equipment has remained in the possession of the first and second defendants. 2 The dispute, which has led to a proceeding in this Court between the plaintiff and the defendants, relates to the question whether the equipment was merely lent to the companies that constituted the partnership, the loan being granted because of the personal relations subsisting between the directors of the various companies, or whether there was an oral contract for the purchase of the equipment pursuant to what was called a contra-agreement, that is to say, an agreement providing for the partnership to do work for the plaintiff company at a specially discounted rate to a total value of $35,000 as the purchase price of the equipment. The plaintiff having demanded the return of the equipment late in October or early in November 2003, the first and second defendants in answer set up the contra-agreement, pursuant to which they claimed the partnership had paid for it, and asserted that ownership had passed to the partners. Since then, the first and second defendants have retained the equipment and have made use of it in their own businesses.