Swire guilty of deceiving Qld truck operator

Swire Cold Storage found guilty of misleading and deceptive conduct towards Queensland trucking company

By Brad Gardner

Swire Cold Storage has been found guilty of misleading and deceptive conduct over its role in leasing one of its Brisbane facilities to a trucking company.

The Supreme Court of Queensland found the logistics provider had breached the Trade Practices Act in its dealings with transport operator JAT Refrigerated Road Services.

The court heard former Swire representative Kevin Towell made written and oral representations in 2005 to lease Swire’s Murarrie cold storage facility to JAT for three years.

Towell also offered a three-year extension for alternative premises in the event Swire chose to close its Murarrie facility.

But in August last year JAT director John Azzopardi received a letter from Swire ordering his business to leave the premises on October 19, with Swire reneging on its offer to provide alternative arrangements.

"At the time oral representations were made [in 2005], Mr Towell had no intention of committing Swires to offering anything to JAT at the expiration of the lease," Justice Peter Dutney says.

"I am not satisfied in the fact that Mr Towell had any actual authority to commit Swires to anything other than a three-year lease at the Murarrie premises."

Dutney ordered Swire to amend its 2005 agreement by allowing JAT to remain at the cold storage facility until the end of March 2010.

The court was told Swire’s actions had the potential to jeopardise JAT’s viability because the refrigerated carrier had nowhere to move its operations.

According to Azzopardi, the company stood to lose its 900-strong customer base if it left the Murarrie facility because there was a shortage of cold storage areas in Brisbane.

"Closure of the business' Brisbane premises for even a relatively short period would result in the loss of some or even many of those customers, possibly irretrievably," Dutney says.

JAT is currently building its own facility, and Dutney says Azzopardi would have fast-tracked construction had he known Swire did not intend on honouring the promise of a three-year extension to the agreement.

Dutney says varying the agreement to allow JAT to remain at Murarrie until 2010 takes into account the time taken to build the new base.

JAT bought the land on July 1, 2008 and Space Frame Buildings expects to complete construction in January next year.

"The lead time to design the premises, acquire the land and construct the premises to completion thus appears to be about two years," Dutney says.

The court heard Swire offered alternative facilities because it intended to close its Murarrie premises.

But Dutney says its plans are unclear because Swire representatives failed to give clear answers when directly asked what the company intended to do.

JAT successfully sought an injunction against Swire after Azzopardi received the eviction notice, which meant the company avoided any financial damage.

Because of this, Dutney ruled that reimbursement should be limited to allowing JAT to remain at Murarrie.

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