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John Young Farming Ltd brought the civil case against the iwi to Invercargill District Court yesterday, more than a year after Ngai Tahu pulled the pin on the contract.
In May 2018, John Young - who, with wife Jo, has a dairy farm near Browns and a run-off block in Northern Southland - told the Otago Daily Times the cancelled contract was a ''by-product'' of the disease.
He said the calves were fit and healthy and they had done their due diligence to ensure they did not have any risks or links to the bacterial cattle disease.
In court yesterday, prosecutor Grant Wilkin said the farmer signed a contract in August 2017 for 1000 bull calves to be delivered to Ngai Tahu from March 1 to May 31 last year.
He said the calves were sourced by Mr Young's livestock agent and arrived at his farm at the end of 2017.
In March, the calves were not ready, and Mr Young suggested waiting until April.
In May, Ngai Tahu told his agent by text message it would not take the animals as Mr Young could not prove his cattle were in a good health, and that was one of the clauses of the contract, Mr Wilkin said.
The iwi never formally asked for any information about the traceability of the animals, and if it had requested that, Mr Young would have provided it.
He said Mr Young's agent also wrote a declaration stating, to the best of their knowledge, none of the cattle had been purchased, grazed or had any physical contact with cattle from any property confirmed to be M. bovis-positive or places under restriction.
Associate judge Kenneth Johnston questioned if the declaration came ''out of the blue'', but Mr Wilkin said he was aware that Ngai Tahu's agent asked vendors for a declaration about M. bovis.
He said Ngai Tahu cancelled the contract based on a ''supposed conversation'' between the agent and Mr Young and they never told him what information they were seeking.
''The concern with respect of the purchase seems to be the traceability of the animals, not necessarily the proof of the good health.''
He said Mr Young fulfilled his part of the tender agreement and Ngai Tahu breached its contract.
''Their concerns were unfounded.''
Counsel Willie Hamilton said his client had ''genuine concerns'' about the good health of the cattle.
He said Ngai Tahu's agent raised concerns on one occasion with Mr Young and another with his agent.
''The information wasn't provided.''
He said that would help his client have a better understanding of the animals.
Judge Johnston said the question was about who should take the responsibility and the risk.
He reserved his decision.
Yesterday, the Ministry for Primary Industries declined to comment on the case, saying it was a civil matter and before the court.
It was not aware of any other similar cases pending, a spokesman said.