$750k payout for Coast company after loan deal turns sour
A SUNSHINE Coast aviation company is flying high after receiving a $750,000 payout from a six-year dispute involving a loaned helicopter engine.
Directors of Pacific Crown Helicopters Pty Ltd, William Hafner and Ian Simpson, who provide aviation services from Sunshine Coast Airport and directors of Helistar Aviation Pty Ltd, Shane Yeend, Douglas Dinan and Mark Pickard, had a decision handed down in the District Court of Queensland this week.
The court document read that Helistar Aviation, which operates helicopters commercially in South Australia, had leased a helicopter engine in 2012, which was incorrectly started in 2014.
Because the engine had been manufactured by EuroTec in America, Mr Dinan was told by EuroTec to contact Pacific Crown Helicopters.
Mr Dinan said in evidence that an employee of EuroTec had told him that Pacific Crown Helicopters was EuroTec's "Australian agent".
Mr Dinan spoke to Pacific Crown Helicopter's sales manager, Simon Daley, who passed away in 2017.
Mr Daley told Mr Dinan that he could borrow a replacement engine owned by EuroTec while the original engine was being repaired.
They entered into an arrangement where EuroTec rented the replacement engine to the Pacific Crown Helicopters, which was then rented to Mr Dinan.
The original engine was first sent to Pacific Crown Helicopters who then sent it to EuroTec in America to be repaired.
It had originally been thought the repair and return of the engine would take only about six months. It has now been more than six years.
Mr William's and Mr Hafner's claim is based on a written agreement on April 2014 to rent the replacement engine to Mr Dinan and claim that they are owned funds for the replacement engine after June 1, which they alleged was when the agreement was terminated.
They were asking for late return rent fees from June 1, 2014 which the agreement stated would be $13,200 per month plus GST, being 150 per cent of the normal monthly rental.
Helistar Aviation received the replacement engine in April 2014 and still had not returned it by the date of the trial.
The company argued that Pacific Crown Helicopters was liable for any negligence caused by EuroTec, as they were an "agent" of the company, a fact that Mr Hafner and Mr Simpson denied.
Mr Dinan argued that he and Mr Daley came to the agreement that he would only return the replacement engine once he received the original engine. This was not accepted by the court.
"What a pity the defendant did not follow through with that sensible intention. If it
had, the engine would have been in the plaintiff's possession by early July 2015," the document read.
"It may be that the original engine would by now have been returned to the defendant,
though that is mere irrelevant speculation. But the plaintiff's claim would have been
limited to one for rent for a very much more limited period than it now seeks."
Judge Reid said Pacific Crown Helicopters was not liable for the engine not being returned by EuroTec.
However, he said the claim, which was more than $1 million, exceeded the jurisdictional limit of the court and was excessive.
He ordered Helistar Aviation to pay Pacific Crown Helicopters $750,000.