Popular bread brand sues for $2.5 million
Nonna's Bakehouse – which supplies more than 100 different types of baked goods to Woolworths, Aldi and Harris Farm – and Ben Furney Flour Mills battled it out in the NSW Supreme Court this week as part of an ongoing disagreement between the two companies.
The Dubbo-based flour mill lodged the legal action, which sought $800,000 from the bakery for the unpaid invoices from 2022, with Nonna's countersuing for $2.5 million for a breach of contract.
The court heard how the bakehouse's issues began in 2021 when its bread became water absorbent and 'sticky' with director Francesco Sergi urging the flour mill to 'fix the issue'.
Despite test runs, visits to the factory and meetings, Ben Furney Flour Mills was unable to identify any issues with the flour provided.
The court heard how the bakery's research and production manager, Jorge Gironda, pleaded with the flour mill to: 'Please provide us with the right fuel to run the Ferrari.'
In May 2022, Nonna's stopped paying invoices to the flour mill, resulting in the flour mill ceasing supply in August.
However, Justice Kelly Ann Rees found the change came after Nonna's changed its head baker, who resigned in September/October 2021, with Mr Gironda taking over.
Judge Rees found that after taking over the role, Mr Sergi had told Mr Gironda to revert to an 'original recipe'.
'Mr Sergi appears to have taken the opportunity of a change of baker to return to the baker's original recipe.
'This departed from (the former head baker's) process of adding gluten or malt if needed to achieve a consistent baking product.'
Judge Rees also ruled the bakehouse's claims that they had suffered a 'substantial loss' as a result of the 'inconsistent flour' were unfounded.
'What is immediately striking from the historical financial performance of the baker, for the 2019 to 2023 financial years, is the significant increase in the baker's sales over those years, increasing by 45 per cent overall,' Judge Rees said.
'Whatever is said to have been wrong with the flour provided by the miller, it does not appear to have affected sales.'
Judge Rees ruled in favour of Ben Furney Flour Mills, ordering a payment of $783,178 together with interest at 10 per cent per annum. Nonna's Bakehouse was also ordered to pay the flour mill's legal costs.
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