SUPREME COURT Decision Reserved On Petrol Payment Claim

Press, Volume CIII, Issue 30389, 13 March 1964, Page 6

SUPREME COURT Decision Reserved On Petrol Payment Claim

In the Supreme Court yesterday, Mr Justice Wilson reserved his decision on a claim by Europa Oil (N.Z.), Ltd., for payment of £lOB2 by Patrick Vincent Kirby. Mr M. F. Hobbs appeared for the company, and Mr R. J. de Goldi for Kirby. Mr Hobbs said the company claimed the sum for petroleum products supplied to Kirby between October 6, 1961, and November 30, 1961, when he was operating the Boomerang Service Station in Worcester street.

Owen Arthur Yorke Johnstone, the Christchurch manager of Europa, said he had been present during some of the discussions which led to Kirby’s decision to lease the premises and purchase the business of the Boomerang

Service Station, a multi-brand station. His company had the contract to supply Government motor vehicles, and over 50 cent of the Europa sold at this station was to Government vehicles, said the witness. Normal procedure for the supply of petrol from wholesaler to retailer called for cash payment, but the retailer supplied the Government vehicles on credit with no immediate return. For this reason, Europa had offered extended credit up to £I3OO to Kirby, t This offer of credit had been accepted and used by Kirby, who had left the service station still owing £IOB2 of this, he said. To Mr de Goldi, the witness agreed that a wholesaler might not, except with the permission of the Motor Spirits Licensing Authority, lend money to a retailer. No application had been made to this authority in relation to approval for this extension of credit. The witness agreed that before Kirby left the service station, all the pumps were changed to Europa, but denied that the company had employed the fact that Kirby owed them a substantial amount of money to persuade him to change over to selling Europa only. Mr de Goldi called no evidence for the defence. He submitted that the moneys which the company sought to recover were in fact moneys lent to Kirby by the delivery over a period of goods valued at £I3OO or more, without payment being required during the course of business between the parties. He referred to the relevant legislation, which provides that a motor spirit supplier may not have any interest in a retailer. Counsel submitted that the deliveries of petroleum products were in breach of the Motor Spirits Distribution Act, and were therefore illegal and no payment could be recovered. In reply, Mr Hobbs submitted that the transaction was simply an extension of credit, a practice fundamental to all fields of trading, and without which the whole trading community would collapse. To succeed, Kirby must show that he had conferred an estate or interest to the company in his business, and this had not been done, said counsel. The word “loan” must be given its ordinary grammatical sense, and the legislature should not be construed so as to restrict credit, a factor which could only encourage trade.