After continual downtime and ongoing repair costs dealing with faulty construction machinery, it was not enough for Rotorua-based Richardson Drilling to describe the equipment as being ‘dud or a ‘lemon’ as justification for compensation. The High Court required detailed evidence as to how and why the machinery broke down before forcing compensation from the Australian supplier.
Australian-owned Digga (NZ) Ltd sold a screw pile drive plus accessories in 2017 to companies associated with Mike Romanes for a total cost of some $177,000 dollars.
Of importance, the equipment was rated as providing torque at 300,000Nm, a critical requirement for heavy duty piling work.
Over the next two years, the equipment was used on a number of jobs in both Wellington and Auckland. It broke down twice, requiring extensive off-site repairs.
Digga supplied replacement equipment from Australia.
Richardson Drilling refused to pay a $57,300 repair bill charged by Digga (NZ) for repairs to the original screw pile.
Richardson said the equipment never achieved promised performance standards. It demanded repayment of the original purchase price.
In the High Court, Justice Blanchard dismissed allegations by Richardson Drilling that it was common knowledge in the industry that Digga’s product ‘did not provide longevity.’ In what was a week-long court hearing, Richardson provided no evidence to support this allegation.
Further, Justice Blanchard said Richardson Drilling did not provide sufficient evidence as to what caused its purchased equipment to fail.
As supplier, Digga said plausible reasons were a failure to properly maintain the equipment and rough handling on the job.
Richardson Drilling was ordered to pay the repair bill and was not awarded a refund on its original 2017 purchase.
Mikro Holdings Ltd v. Digga NZ Ltd – High Court (14.08.24)
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