Coastal Ventures (PPC) Pty Ltd v Pure Pleasure Cruises Pty Ltd & Anor [1999] QSC 315

:)1\(1 '----- State Reporting TRANSCRIPT OF PROCEEDINGS Copyright in this transcript is vested in the Crown. Copies thereof must not be made or sold without the written authority of the Director, State Reporting Bureau. SUPREME COURT OF QUEENSLAND CIVIL JURISDICTION de JERSEY CJ No S591 of 1999 COASTAL VENTURES (PPC) PROPRIETARY LIMITED (ACN 080 266 011) and PURE PLEASURE CRUISES PROPRIETARY LIMITED (ACN 011 003 428) and NODNOC PROPRIETARY LIMITED (ACN 001 112 839) TOWNSVILLE .. DATE 29/09/99 JUDGMENT 1 REVISED COPIES ISSUED State Reporting Bureau DATE 30/09/99 Applicant First Respondent Second Respondent Hh Floor, The Law Courts Complex, George Street, Brisbane Q. 4000. Telephone: (07)32474360. Facsimile: (07) 32475532 -- 1 of 4 -- 290999 T4/AD MIT TSVSC6110 (de Jersey CJ) HIS HONOUR: The applicant is party to an agreement with the respondents dated 1 October 1997, which provides on its face for the lease to the applicant of a motor vessel and associated equipment for a term of 60 months from 1 November 1997 at a rental of $30,000 per month with an obligation in the applicant then to purchase the goods for $650,000 whereupon title would pass. The applicant contends that the agreement is in truth a hire purchase agreement because it is an agreement for the purchase of goods by installments even though the installments are described as rent. Those terms 10 are taken from the definition of hire purchase agreement in the Hire Purchase Act 1959. Mr Traves appeared for the respondents. He submitted that I should not determine the issue simply by reference to the agreement. That is, however, the way one should ordinarily go about such a task. He was unable to point to any other evidence which might help resolve the issue. His submission came down to this: it is not clear one way or the other on the face of the agreement whether it amounts to a hire purchase 20 agreement so I should make no declaration. I do not accept that. Resolving the issue may be difficult, perhaps, but that does not relieve me of the burden and when it is not suggested there may be other relevant evidence not presently before the Court, I believe I should proceed to determine the issue now. Determining it will be of practical utility to the parties and may necessitate subsequent determinations with relation to consequences, bearing upon section 3 subsections (1) and (5) of the Hire Purchase Act, but that possible future need to 30 2 JUDGMENT -- 2 of 4 -- 290999 T4/AD M/T TSVSC6110 (de Jersey CJ) determine other questions should not lead to my now not resolving the instant anterior question. As the terms of the definition of hire purchase agreements show, the inquiry must focus on the real nature of the agreement rather than its form. See also similarly, although in a slightly different context, section 2, subsection (3) of the Hire Purchase Act. There are here strong indications that in real terms the parties agreed upon the applicant's purchase of the goods by installments. I should say at once that none of the exclusions set out in the definition of hire purchase agreement applies. I refer in particular to the provision for payment of so-called rental, the obligation to pay the balance due on the expiry of the term, or on earlier termination for breach, the provision requiring the purchase at the expiry of the term and the references to residual value. On one view, as I pointed out during the submissions, the requirement for redelivery at the end of the term in clause 12.1 could suggest a separation between the two transactions, the separation for which Mr Traves would contend is between a lease on the one hand and a following sale on the other. But the requirement for redelivery under clause 12.1 would frankly seem to lack practical consequence and the inclusion of that requirement may simply have amounted to part of a device intended to blur the reality of the situation otherwise emerging. I have to say that overall I do consider that this transaction in reality amounted to a hire purchase agreement within the 10 20 meaning of the definition in the Act. There will, therefore, 30 3 JUDGMENT -- 3 of 4 -- 290999 T4/AD M/T TSVSC6110 (de Jersey CJ) be a declaration that the agreement between the parties dated 1 October 1997, a copy of which is Exhibit A to the affidavit of P D Savage filed 29 July 1999, is a hire purchase agreement within the meaning of the Hire Purchase Act 1959. Further proceedings on the application are adjourned. HIS HONOUR: My declaration relates only to the boat and the associated equipment as I style it in the judgment. I will 10 reserve costs. 4 JUDGMENT -- 4 of 4 --