AGK Pacific (NG) Pty Ltd v ET Taylor Constructions Pty Ltd (1990) N871

• Jurisdiction: Papua New Guinea
• Judge: Doherty AJ
• Judgment Date: 20 April 1990
• Citation: (1990) N871
• Court: National Court
• Year: 1990
• Judgement Number: N871

Full Title: AGK Pacific (NG) Pty Ltd v ET Taylor Constructions Pty Ltd (1990) N871

National Court: Doherty AJ

Judgment Delivered: 20 April 1990

N871

PAPUA NEW GUINEA

[NATIONAL COURT OF JUSTICE]

W.S. 741 OF 1989

BETWEEN: AGK PACIFIC (NG) PTY LTD

PLAINTIFF

AND: E T TAYLOR CONSTRUCTIONS PTY LTD

DEFENDANT

Lae

Doherty AJ

20-21 March 1990

23 March 1990

20 April 1990

BREACH CONTRACT — implied terms — terms of a contract between a builder and his client not binding on a supplier unless the terms were expressly or impliedly incorporated — contract completed when goods accepted — costs.

The plaintiff contracted with the defendant to construct timber counters and stairs for use in buildings the defendants were erecting for their clients. There was no written contract between the parties other than a drawing of the design of the counters and stairs and an order which stated goods were "ex workshop". The defendants collected the goods from the plaintiffs workshop and installed them but failed to pay. After several months they complained of defects and purported to reduce payment to account for costs of remedial work after issue of the writ.

Held

(1) The plaintiffs were a supplier and not subject to the terms and conditions of the contract between defendant builder and his client.

(2) Terms as to workmanship and condition of timber may be incorporated if stated on the drawings handed to the joiner.

(3) Contract was completed when the goods were accepted at the workshop and any rejection due to defect should have been made there.

Counsel

K Gamoga, for the plaintiff.

P Kowa, for the defendant.

DOHERTY AJ: The plaintiff claims a total of K15,836.00 from the defendant company for two contracts for the supply of goods in or about July and August 1988.

The defendant says that it paid part of these accounts, after the issue of the writ to an amount of K12,660.00 and that it disputes the balance of K3,170.00 on the basis of defects of workmanship. The plaintiff did not accept the sum of K12,660.00 as it was tendered as a full and final settlement of the claim and the hearing proceeded for the total amount of K15,836.00.

There had been various dealings between the two companies over an unspecified number of years. There is no suggestion or evidence that there had been prior conflicts nor was there any written or oral contractual terms between the parties in the past that applies to these contracts.

The claim involves two separate supplies of timber products. The first were counters for the Westpac Bank at Wau and the Westpac Bank at Bulolo (hereinafter the Wau/Bulolo contract) the total of this claim was K13,514.00. The second contract was for the supply of stairs to a residential property (hereinafter the stair contract) in Lae. There is no connection between these two contracts and I find that they were separate contracts, which took place at different times, that the parties intended them to be two different contracts and the terms of the contract were not intended by the parties to be the same.

There is ample evidence, and it is undisputed, that there was offer and acceptance between the parties and it was intended that the parties be contractually and legally bound. However there is little evidence as to the exact terms of the contract and it is those terms that have lead to the present dispute. Two witnesses gave evidence on behalf of the plaintiff as to the negotiation and the implementation of the contract.

Two witnesses gave evidence on behalf of the defendant on the remedial work that had to be carried out by the defendant to rectify defects they alleged were present in the goods supplied and the price and cost of those remedial works. Neither of these witnesses for the defence was present or employed by the defendant at the time when the contracts were entered into with the plaintiff. As a result, the evidence by the plaintiffs on the terms and conditions and negotiations which took place between the parties and the condition of the goods when they passed from plaintiff to the defendant are unrebutted.

THE WAU/BULOLO CONTRACT

The plaintiff states that he was requested to build counters, writing slopes and cupboards for the Westpac Bank and agreed to do so. The first approach was the request for a quotation for the cost of the supply and the plaintiff gave a hand-written quotation "Our price to supply only, ex workshop, joinery units as follows for Westpac Bank:

Bulolo J1-J9K8,686.00Wau J1-J5K4,828.00."The calculation includes a statement "note ex works, Krommelie whatever available in Lae." The plaintiff states that the defendant accepted that quotation and I find that prior to that quotation there was an invitation to treat (i.e the request for a quotation) and the quotation constituted an offer which was accepted by the defendant.

The evidence shows that the works were completed in accordance with a drawing which the plaintiff says was part of a working drawing given to them by the defendant and which they followed. It would appear this was part of the construction drawings although this is not clear from either party. In any event the drawing was not produced in court nor any other specifications that went with the drawing. The workshop manager of the plaintiff company said in evidence that the counters were completed in accordance with the drawing given and were collected by the employees of the defendant company in their own vehicle and he presumed transported to Wau and Bulolo viz "ex workshop" as stated in the offer. He was unsure of the date of collection but it was prior to the issue of an invoice dated the 31st of August 1989. No evidence in rebuttal of this was adduced. The manager states that he made numerous attempts to collect the amount of K13,514.00 due for the supply of the counters etc. It was not until April 1989 that e received a letter dated in March 1989 from the defendant stating there were defects in the counters. He had not been aware of this prior to that letter.

It would appear from the evidence by the defendant that the complaint arose following the issue of the notice by the architects of a remedial work required in the buildings at Wau and Bulolo. Notices were issued by the architect in December 1988 and in April 1989.

The contract for supply of the building was between the defendant E T Taylor and the company Westpac Bank. It would appear, there is no clear evidence, that the building was to be in accordance with the drawings and specifications by the architect retained by the Westpac Bank. The plaintiff company was not a party to that contract. The plaintiff company was not a nominated or named subcontractor of the defendant contractor in that building contract. It had no contractual relationship between it and the Westpac Bank or between it and the architect who, in a building contract, is an agent for a client or person requiring the building. The plaintiff's status was as a supplier of the main contractor that is the...