In February 2015, Taranaki aviation enthusiast Brett Emeny paid $90,000, strapped himself into a vintage Trojan T28 ‘war bird’ and flew home to New Plymouth. In his wake, he left a divided twenty-two member syndicate arguing over who owned the plane.
The Court of Appeal was told there are only two Trojan T28 aircraft in New Zealand. Trojans were developed in the 1950s as a single seater training aircraft for the US air force and navy. ZK-JGS was purchased by a twenty-two man syndicate in 1990. In legal jargon, they owned the aircraft as tenants-in-common: each had a separate undivided ownership interest. All agreed to syndicate rules setting out rights of use and apportionment of costs. Over the years, the aircraft was used less. With debts outstanding of some $63,500, it was decided to put the aircraft up for sale. Members decided to wind up their syndicate. Four syndicate members were appointed as a ‘management group’ to sell the aircraft. Closing date for tenders was set for 19 December 2014. One syndicate member, David Corrick, put in a bid of $63,523 later upped to $85,000 when a bidding war erupted between syndicate members: Brett Emeny offered $75,000; Glenn McCready $80,000.
The court was told the management group then polled syndicate members as to which offer they were comfortable with. A majority favoured Mr Corrick. He sued when Mr Emeny fronted up with $90,000 and flew off with the aircraft.
The Court of Appeal ruled there was no contract with Mr Corrick. The syndicate delegated to its management group the task of selling the aircraft. At no time did the management group accept Mr Corrick’s offer. The closest it got was in making a counter-offer, rejecting contract terms prescribed by Mr Corrick and suggesting in reply a more simple agreement that would suffice. Asking syndicate members for their views on price did not amount to acceptance of Mr Corrick’s offer; it was merely a supply of information to them. Members collectively did not have the power to make a sale; that had been delegated to the management group. The subsequent sale for $90,000 by the management group to Mr Emeny was a binding contract.
Corrick v. Silich – Court of Appeal (29.06.18)
18.134