Contracts [7 ed.] 9780409327823, 0409327824

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CANADA CHILE CHINA CZECH REPUBLIC FRANCE GERMANY HONGKONG HUNGARY INDIA ITALY JAPAN KOREA MALAYSIA NEW ZEALAND POLAND SINGAPORE SOUTH AFRICA SWITZERLAND TAIWAN UNITED KINGDOM USA

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National Library of Australia Cataloguing-in-Publication entry Author: Title: Edition: ISBN:

Smith, Matthew. Contracts. 7th edition.

Series: Notes: Subjects: Dewey Number:

LexisNexis Case Summaries. Includes index. Contracts -Australia - Cases.

9780409327823 (pbk). 9780409329032 (ebook).

346.9402.

Contents Case Number

2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

© 2011 Reed International Books Australia Pty Limited trading as LexisNexis.

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First edition 1984; second edition 1988; third edition 1991; fourth edition 1995; fifth edition 1999; reprinted 2002, sixth edition 2004.

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This book is copyright. Except as pennitted under the Copyright Act 1968 (Cth), no part of this publication may be reproduced by any process, electronic or otheiwise, without the specific written permission of the copyright owner. Neither may information be stored electronically in any form whatsoever without such permission. Inquiries should be addressed to the publishers. Typeset in Goudy and Helvetica. Printed in China. Visit LexisNexis Butteiworths at www.lexisnexis.com.au

22 23 24

Case Name

Av Hayden (No 2) Accounting Systems 2000 (Developments) Pty Ltd v CCH Australia Ltd Administration of the Territory of Papua and New Guinea v Leahy Aiton Australia Pty Ltd v Transfield Pty Ltd Alati v Kruger Alderslade v Hendon Laundry Ltd Alexander v Cambridge Credit Corp Ltd Alexander v Rayson Amev-UDC Finance Ltd v Austin Amoco Australia Pty Ltd v Rocca Bros Motor Engineering Co Pty Ltd Andrews v Parker Ankar Pty Ltd v National Westminster Finance (Aust) Ltd Appleby v Myers Associated Newspapers Ltd v Bancks Astley v Austrust Ltd Attorney General v Blake Attwood v Lamont Australia and New Zealand Banking Group v Karam Australian Broadcasting Commission v Australasian Performing Right Association Ltd Australian Competition and Consumer Commission v C G Berbatis Holdings Pty Ltd Australian Competition and Consumer Commission v Samton Holdings Pty Ltd Australian Competition and Consumer Commission v Simply No-Knead (Franchising) Pty Ltd Australian Woollen Mills Pty Ltd v Commonwealth Automatic Fire Sprinklers Pty Ltd v Watson iii

1 2 2

3 3

4 4 5 5 6 6

7 7 8 8 9 9 10 11

11

12

13 13

Contents

LexisNexis Case Summaries

Case Number

~ 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55

Case Number

Case Name Balfour v Balfour Balmain New Ferry Co Ltd v Robertson Baltic Shipping Co v Dillon Bank Line Ltd v Arthur Capel and Co Banque Brussels Lambert SA v Australian National Industries Ltd Barton v Armstrong Beaton v McDivitt Bell v Lever Brothers Ltd Bellgrove v Eldridge Beswick v Beswick Bettini v Gye Biotechnology Australia Pty Ltd v Pace Bisset v Wilkinson Blomley v Ryan ~olton v Mahadeva ) [ ooker Industries Pty Ltd v Wilson Parking (Qld) Pty Ltd Boone v Eyre Bot v Ristevski Bowes v Chaleyer Bowmakers Ltd v Barnet Instruments Ltd Bradshaw v Gilbert's (Australasian) Agency (Vic) Pty Ltd Brambles Holdings Ltd v Bathurst City Council Brenner v First Artists' Management Pty Ltd Bridge v Deacons Bridgewater v Leahy Brinkibon Ltd v Stahag Stahl Und Stahlwarenhandelsgesellschaft mbH Brisbane City Council v Group Projects Pry Ltd British Westinghouse Electric and Manufacturing Co Ltd v Underground Electric Railways Co of London Ltd Brooks v Bums Philp Trustee Co Ltd Brooks v Beirnstein Brown v Smitt

iv

14 14 15 15 16 16 17 17 18 18 19 19 20 21

21) 22 22 22

23 23 24 25 25 26 26 27 27

56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77

78 79 80 81

28 28 29 29

82 83 84 85

Case Name Bunge Corporation v Tradax SA 30 Burger King Corporation v Hungry Jack's Pty Ltd 30 Burns v Man Automotive (Aust) Pry Ltd 31 Butcher v Lachlan Elder Realty Pry Ltd 32 Butler Machine Tool Co Ltd v Ex-Cell-O Corp (England) Ltd 32 Byrne and Frew v Australian Airlines Ltd 33 Callaghan v O'Sullivan 34 Campomar Sociedad Limitada v Nike International Ltd 34 35 Canning v Temby Car and Universal Finance Co Ltd v Caldwell 35 36 Carlill v Carbolic Smoke Ball Co 36 Carney v Herbert Carr v J A Berriman Pty Ltd 37 37 Casey's Patents, Re 38 Causer v Browne Cehave NV v Bremer Handelsgesellschaft mbH; 38 the Hansa Nord Central London Property Trust Ltd v High Trees 39 House Ltd 39 Chappell & Co Ltd v Nestle Co Ltd Clea Shipping Corp v Bulk Oil International Ltd 40 40 Clegg v Wilson Coal Cliff Collieries Pty Ltd v Sijehama Pty Ltd 41 Coastal Estates Pty Ltd v Melevende 41 Codelfa Construction Pry Ltd v State Rail 42 Authority of New South Wales 42 Commercial Bank of Australia Ltd v Amadio Commercial Banking Co of Sydney Ltd 43 v R H Brown & Co Commonwealth of Australia v Amann Aviation Pry Ltd 44 Commonwealth of Australia v Verwayen 44 Concrete Constructions (NSW) Pty Ltd v Nelson 45 46 Concut Pry Ltd v Worrell Con-Stan Industries of Australia Pty Ltd 46 v Norwich Winterthur Insurance (Aust) Ltd v

LexisNexis Case Summaries

Case Number

86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114

Contents

Case Number

Case Name Couchman v Hill Coulls v Bagot's Executor and Trustee Co Ltd Crawford Fitting Co v Sydney Valve & Fittings Pty Ltd The Crown v Clarke Cundy v Lindsay Curro v Beyond Productions Pty Ltd Curtis v Chemical Cleaning and Dyeing Co Cutter v Powell Darlington Futures Ltd v Delco Australia Pty Ltd David Securities Pty Ltd v Commonwealth Bank of Australia Davies v London and Provincial Marine Insurance Co Davis v Pearce Parking Station Pty Ltd Davis Contractors Ltd v Fareham Urban District Council Demagogue Pty Ltd v Ramensky Derbyshire Building Co Pty Ltd v Becker Derry v Peek Dick Bentley Productions Ltd v Harold Smith (Motors) Ltd Dickinson v Dodds Dodd Properties (Kent) Ltd v Canterbury City Council Dougan v Ley DTR Nominees Pty Ltd v Mona Homes Pty Ltd Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd Dunlop Pneumatic Tyre Co Ltd v Selfridge and Co Ltd Dunton v Dunton Eastwood v Kenyon Edgington v Fitzmaurice Elias v George Sahely & Co (Barbados) Ltd Embiricos v Sydney Reid & Co Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd vi

47 47 48 48 49 49

~~ 51 51 52 52

115 116 117 118 119 120 121 122 123 124 125 126 127

53 53 54 54

128 129

55 55

130 131 132 133

56 56 57 57 58 58 59 59 59 60 60

134 135 136 137 138 139 140 141 142 143

Case Name Ermogenous v Greek Orthodox Community of SA Inc Esanda Finance Corporation Ltd v Plessnig J Evans & Son (Portsmouth) Ltd v Andrea Merzario Ltd Felthouse v Bindley Fibrosa Spolka Akcyjna v Fairbairn Lawson Combe Barbour Ltd Firth v Halloran Fitzgerald v F J Leonhardt Pty Ltd Fitzgerald v Masters Foakes v Beer Foran v Wight Futuretronics International Pty Ltd v Gadzhis Garcia v National Australia Bank Ltd Garry Rogers Motors (Aust) Pty Ltd v Subaru (Aust) Pty Ltd Gates v City Mutual Life Assurance Society Ltd George v Greater Adelaide Land Development Co Ltd Gibbons v Wright Gibson v Manchester City Council Giumelli v Giumelli Glasbrook Bros Ltd v Glamorgan County Council Godecke v Kirwan Goldsbrough Mort & Co Ltd v Carter Goldsbrough Mort & Co Ltd v Quinn Gordon v MacGregor Gould v Vaggelas Government of Newfoundland v Newfoundland Railway Company Great Peace Shipping Ltd v Tsavliris Salvage (International) Ltd Greaves & Co (Contractors) Ltd v Baynham Meikle and Partners Hall v Busst Harvey v Edwards, Dunlop and Co Ltd vii

61 61 62 62 63 63 64 64 65 65 66 66 67 68 68 69 69 69 70 71 71 72 72 73 73 74 75 75 76

LexisNexis Case Summaries

Case Number

144 145 146 147 148 149 150 151 152 153 154 155 156 157 158 159 160 161 162 163 164 165 166 167 168 169

~ 172

Contents

Case Name

Case Number

Hatcher v White Hawker Pacific Pty Ltd v Helicopter Charter Pty Ltd Helicopter Sales (Aust) Pty Ltd v Rotor-Work Pty Ltd Henjo Investments Pty Ltd v Collins Marrickville Pty Ltd (No 1) Henville v Walker Heyman v Darwins Ltd DJ Hill & Co Pty Ltd v Walter H Wright Pty Ltd Hoenig v Isaacs Hoffman v Cali Holland v Wiltshire Holmes v Jones Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd Hope v RCA Photophone of Australia Pty Ltd Howe vTeefy Hoyt's Pty Ltd v Spencer Hungerfords v Walker Hyundai Heavy Industries Co Ltd v Papadopoulos I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd Immer (No 145) Pty Ltd v Uniting Church in Australia Property Trust (NSW) TC Industrial Plant Pty Ltd v Robert's Queensland Pty Ltd Jackson v Union Marine Insurance Co Ltd Jarvis v Swans Tours Ltd Je Maintiendrai Pty Ltd v Quaglia Johnson v Agnew Johnson v Buttress Johnson v Perez Jones v Padavatton Joscelyne v Nissen Kiriri Cotton Co Ltd v Dewani viii

76

173

77

174

77

175 176 177

78 78 79 79 80 80 81 81 82 83 83 84 84 85 85 86 86 87 87 88 88 89 89 90 90 91

178 179 180 181 182 183 184 185 186 187 188 189 190 191 192 193 194 195 196

197 198 199 200

Case Name

Kodros Shipping Corporation of Monrovia v Empresa Cubana De Fletes Koompahtoo Local Aboriginal Land Council v Sanpine Pty L~ Koufos v C Czamikow Lt Krell v Henry Laurinda Pty Ltd v Capalaba Park Shopping Centre Pty Ltd Leason Pty Ltd v Princes Farm Pty Ltd Legione v Hateley L'estrange v F Graucob Ltd Lewes Nominees Pty Ltd v Strang Lewis v Averay Life Insurance Co of Australia Ltd v Phillips Lindner v Murdock's Garage Liverpool City Council v Irwin Louinder v Leis Louth v Diprose Lucy v Commonwealth Lumbers v W Cook Builders Pty Ltd Lumley v Wagner Luna Park (NSW) Ltd v Tramways Advertising Pty Ltd McDermott v Black McDonald v Dennys Lascelles Ltd McKenzie v McDonald McRae v Commonwealth Disposalv Commission MaCrobertson Miller Airline Services v Commissioner of State Taxation (Western Australia) McTier v Haupt Maggbury Pty Ltd v Hafele Australia Pty Ltd MaHoney v Lindsay Manchester Diocesan Council for Education v Commercial & General Investments Ltd

ix

91

92 92

...2L 93 94 94 95 95 96 96 97 97 98 98 99 99 100 100 101 101 102 102

103 103 104 104 105

Contents

LexisNexis Case Summaries

Case Number

201 202 203 204 205 206 207 208 209 210

~ 2 213 214 215

216 217 218 219 220 221 222 223 224 225 226 227

Case Number

Case Name Maple Flock Co Ltd v Universal Furniture Products (Wembley) Ltd Maralinga Pty Ltd v Major Enterprises Pty Ltd Maredelanto Compania Naviera SA v Bergbau-Handel Gmbh (the Mihalis Angelos) Maritime National Fish Ltd v Ocean Trawlers Ltd Marks v GIO Australia Holdings Ltd Masters v Cameron Maynard v Goode Meehan v Jones Mobil Oil Australia Ltd v Wellcome International Pty Ltd The Moorcock Morris v Baron and Co Murphy v Overton Investments Pty Ltd Musumeci v Winadell Pty Ltd Nash v Inman National Carriers Ltd v Panalpina (Northern) Ltd New Zealand Shipping Co Ltd v A M Satterthwaite & Co Ltd Nordenfelt v Maxim Nordenfelt Guns and Ammunition Co Ltd North v Marra Developments Ltd North Ocean Shipping Co Ltd v Hyundai Construction Co Ltd O'Brien v Smolonogov Oceanic Sun Line Special Shipping Co Inc v Fay O'Dea v Allstates Leasing System (WA) Pty Ltd Ogilvie v Ryan Orton v Melman Oscar Chess Ltd v Williams Pacific Brands Sport & Leisure Pty Ltd v Underworks Pty Ltd Pacific Carriers Ltd v BNP Paribas

x

105 106 106 107 107 108 108 109

228 229 230 231 232 233 234 235 236

109 110 110 111 111 112

237

112

242 243 244

113 113 114 114 115 115 116 117 117 118 118 119

238 239 240 241

245 246 247 248 249 250 251 252 253 254 255

Case Name Pao On v Lau Yiu Long Parker v South Eastern Railway Co H Parsons (Livestock) Ltd v Uttley Ingham &Co Ltd Pavey & Matthews Pty Ltd v Paul Perri v Coolangatta Investments Pty Ltd Petelin v Cullen Peter Turnbull and Co Pty Ltd v Mundus Trading Co (Australasia) Pty Ltd Peters Ice Cream (Vic) Ltd v Todd Pharmaceutical Society of Great Britain v Boots Cash Chemists (Southern) Ltd Photo Production Ltd v Securicor Transport Ltd Pirie v Saunders Placer Development Ltd v Commonwealth Popiw v Popiw Port Jackson Stevedoring Pty Ltd v Salmond & Spraggon (Aust) Pty Ltd Porter v Latec Finance (Qld) Pty Ltd Price v Strange Progressive Mailing House Pty Ltd v Tabali Pty Ltd Public Trustee v Taylor Pukallus v Cameron Pym v Campbell Radford v De Froberville Rawson v Hobbs Reardon Smith Line Ltd v Yngvar Hansen-Tangen Redgrave v Hurd Reg Glass Pty Ltd v Rivers Locking Systems Pty Ltd Regent v Millett Renard Constructions (ME) Pty Ltd v Minister for Public Works Rinaldi & Patroni Pty Ltd v Precision Mouldings Pty Ltd

xi

120 121 121 122 122 123 123 124 124 125 125 126 126 127 127 128 128 129 129 130 130 131 131 132 132 133 133 134

LexisNexis Case Summaries Case Number

256 257 258 259 260 261 262 263 264 265 266 267 268 269 270 271 272 273 274 275 276 277 278 279 280 281

Contents

Case Name

Case Number

Ringrow Pty Ltd v BP Australia Pty Ltd M K & J A Roche Pty Ltd v Metro Edgley Pty Ltd Roscorla v Thomas Rose and Frank Co v J R Crompton and Bros Ltd Roxborough v Rothmans of Pall Mall Australia Ltd Royal Botanic Gardens and Domain Trust v South Sydney City Council Sabemo Pty Ltd v North Sydney Municipal Council St John Shipping Corporation v Joseph Rank Ltd Sajan Singh v Sardara Ali Sargent v ASL Developments Pty Ltd Saunders v Anglia Building Society J J Savage & Sons Pty Ltd v Blakney G Scammell and Nephew Ltd v H C and J G Ouston Secured Income Real Estate (Aust) Ltd v St Martins Investments Pty Ltd Sellars v Adelaide Petroleum Nl B Seppelt & Sons Ltd v Commissioner for Main Roads L Shaddock & Associates Pty Ltd v Parramatta City Council (No 1) Shepperd v Council of The Municipality ofRyde Shevill v Builders Licensing Board Simmons Ltd v Hay Simonius Vischer & Co v Holt & Thompson Sindel v Georgiou Smith v Hughes Smith v Land and House Property Corporation Smythe v Thomas Solle v Butcher

xii

135

282

135 136

283

136 137 137 138 139 139 140 140 141 141 142 142 143 143 144 144 145 145 146 146 147 147 148

284 285 286 287 288 289 290 291 292 293 294 295 296 297 298 299 300 301 302 303 304 305 306 307 308 309

Case Name

South Australian Cold Stores Ltd v Electricity Trust of South Australia State Rail Authority of New South Wales v Heath Outdoor Pty Ltd Steele v Tardiani Stem v McArthur Stevenson, Jaques & Co v McLean Stilk v Myrick Stuart Pty Ltd v Condor Commercial Insulation Pty Ltd Sumpter v Hedges T A Sundell & Sons Pty Ltd v Emm Yannoulatos (Overseas) Pty Ltd Suttor v Gundowda Pty Ltd Svanosio v McNamara Sydney City Council v West Sykes v Reserve Bank of Australia Tanwar Enterprises Pty Ltd v Cauchi Taylor v Caldwell Taylor v Johnson Thomas Brown and Sons Ltd v Fazal Deen Thomas National Transport (Melbourne) Pty Ltd v May & Baker (Aust) Pty Ltd Thornton v Shoe Lane Parking Ltd Todd v Nicol Tolhurst v Associated Portland Cement Manufacturers (1900) Ltd Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd Trident General Insurance Co Ltd v McNiece Bros Pty Ltd Tropical Traders Ltd v Goonan Universal Cargo Carriers Corporation v Citati Universe Tankships Inc of Monrovia v International Transport Workers Federation Upper Hunter County District Council v Australian Chilling and Freezing Co Ltd Vadasz v Pioneer Concrete (SA) Pty Ltd xiii

148 149 149 150 150 151 151 152 152 153 153 154 154 155

1j5__ 156 156 157 157 158 158 159 159 160 160 161 161 162

LexisNexis Case Summaries

Case Number

310 311 312 313 31 4 315 316 317 318 319 320 321 322 323 324 325 326 327 328 329

Preface

Case Name Victoria Laundry (Windsor) Ltd v Newman Industries Ltd Vimig Pty Ltd v Contract Tooling Pty Ltd Waltons Stores (Interstate) Ltd v Maher Watt v Westhoven West v AGC (Advances) Ltd Westmelton (Vic) Pty Ltd v Archer Westpac Banking Corporation v Tanzone Pty Ltd Westralian Farmers Ltd v Commonwealth Agricultural Service Engineers Ltd (in liq) White v Australian and New Zealand Theatres Ltd White and Carter (Councils) Ltd v McGregor Whitlock v Brew Whittet v State Bank of New South Wales Wigan v Edwards Wilkinson v Osborne Williams v Roffey Bros & Nicholls (Contractors) Ltd J C Williamson Ltd v Lukey and Mulholland Woodar Investment Development Ltd v Wimpey Construction UK Ltd Yango Pastoral Co Pty Ltd v First Chicago Australia Ltd Yerkey v Jones Young v Queensland Trustees Ltd

xiv

162 163 163 164 164 165 165 166 166 167 167 168 168 169

This book was first published in 1983, as the introductory book in a series of 'Butterworths' Student Companions'. In my preface, I said: The efforts of legal headnoters and precis writers are more often condemned than appreciated, and this fate probably awaits these casenotes if they fall into the hands of scholars. However, I hope that students may find them useful when, daunted by thickets of judicial verbiage, they try to discover what the cases they are taught are about.

My hopes were fulfilled, as is demonstrated by the regular appearance of further editions. My fears of scholars did not eventuate, probably because they and their teachers ignored the book. However, its assistance is appreciated by students struggling to digest the official casebooks. A preface was dropped in recent editions, but it is appropriately restored for this seventh edition. It marks the renaming of the series, and liberation from previous restraints on the size of the book. As well as adding many cases, I have fully revised all the case notes to include the series' headings of 'Facts', 'Issue' and 'Decision'.

169 170

I hope that the book will continue to assist new generations of law students.

170

Matthew Smith Sydney, March 2011

171 171 172

xv

Contracts [1] Av HAYDEN (No 2) (1984) 156 CLR 532; 56 ALR 82 High Court of Australia Illegal contract -

Prejudice to the administration of justice

FACTS The Australian Secret Intelligence Service conducted a training exercise at the Sheraton Hotel in Melbourne, in which masked men opened a door with a sledge-hammer and threatened the manager and guests with firearms. Eleven participants in the training exercise sought orders restraining the Commonwealth authorities from disclosing their names to the Victoria Police, who were investigating whether crimes had been committed. The participants relied upon a term of their employment that their identities would be kept confidential. ISSUE Was the confidentiality term unenforceable on public policy grounds? DECISION Relief was denied. Enforcement of the term would be contrary to public policy, since it had the tendency to affect adversely the administration of the criminal law.

[2]

ACCOUNTING SYSTEMS 2000 (DEVELOPMENTS) PTY LTD v CCH AUSTRALIA LTD (1993) 42 FCR 470; 114 ALR 355 Federal Court of Australia

Trade Practices Act remedy for inaccurate warranty FACTS Accounting Systems assigned to CCH its computer programs for public accountants and tax agents, and expressly warranted that it was entitled to assign the copyright without the consent of any other person and that there was no potential claim for infringement of copyright. In fact, the programs made substantial use of software owned by Focus Business Systems Pty Ltd, and its consent was needed before CCH could market the product. CCH brought proceedings under Trade Practices Act 1974 (Cth) ss 82 and 87 for damages and orders declaring the agreements void ab initio. Section 52(1) of the Act prohibited 'conduct that is misleading or deceptive or is likely to mislead or deceive'. ISSUE Did Accounting Systems contravene Trade Practices Acts 52?

LexisNexis Case Summaries

Contracts

DECISION By majority: CCH succeeded. The giving of inaccurate written warranties in an agreement was capable of constituting misleading conduct under s 52 without any previous representation or other conduct.

ISSUE Was cl 28 enforceable as a condition precedent to the commencement of litigation?

[3]

ADMINISTRATION OFTHETERRITORY OF PAPUA AND NEW GUINEA v LEAHY (1961) 105 CLR 6 High Court of Australia

DECISION Clause 28, including the obligations to negotiate and to mediate in good faith, was sufficiently certain to be enforceable. However, the mediation clause was unenforceable, due to its uncertainty as to apportionment of the mediator's costs, and the agreement to negotiate was inseverable and also unenforceable. A stay was therefore refused.

[5] ALATI v KRUGER (1955) 94 CLR 216 High Court of Australia

Intention to enter contractual relations FACTS The Administration agreed to carry out a tick-eradication program on Leahy's property at his request. Through deficiencies of character and over-indulgence in alcohol, the Administration's officers neglected their work, and Leahy's cattle became more seriously affected with Redwater Fever than they had been before. He sued for damages. ISSUE Was there a contract? DECISION Leahy failed. The arrangements were not contractual, since the Administration did no more than give effect to a general policy of dispensing aid to individual cattle owners as a means of coping with a recognised menace to an important part of the Territory's economy, and Leahy's attitude throughout was that of a private person appealing for government assistance.

[4]

AITON AUSTRALIA PTY LTD vTRANSFIELD PTY LTD (1999) 153 FLR 236 Supreme Court of New South Wales

Uncertainty of condition agreement

good faith negotiations -

mediation

FACTS Aiton contracted with Transfield to construct part of the Osborne Co-Generation project in South Australia. It commenced proceedings for damages under the Trade Practices Act 1974 (Cth), after its claims for payment were disputed by Transfield. Transfield applied for a stay of proceedings on the ground that dispute resolution procedures under the contract had not been followed by Aiton. Clause 28.1 of the contract provided that the parties 'shall make diligent and good faith efforts to resolve all disputes in accordance with the provisions of this Section 28. l before either party commences legal action'. The clause set out a dispute notice and negotiations procedure, and provided that unresolved disputes would be submitted to mediation.

2

Rescission for fraud -

Restitutio in integrum

FACTS Alati ~uced Kru~r to purchase a fruit shop busines~ by representing_iliat its average takings were £100 er week. Within two weeks of taking possessio~ Krugerj~~md th~ the representation was false, and he commenced proceedings for rescission. He continued to carry on the business for several months, but closed it down anle re&..cisajpn for misrepresentation on terms of guarantee FACTS Vadasz executed a guarantee to pay 'all monies which are now or may at any time until we are released be owing' by his company, Vadipile Drilling, to Pioneer Concrete. Vadipile became insolvent, but when Vadasz was sued for $357,427.37, he claimed that the guarantee was unenforceable, because it was induced by misrepresentations that the guarantee would be with respect to indebtedness only for future supplies by Pioneer. ISSUE Should the entire guarantee be rescinded for misrepresentation? DECISION Judgment was entered for $170,929.32. Vadasz was entitled _!o relief in equity by which the .Buarantee was rescinded as regards past indebtedness. The court must look at what was practically just for both arties, and to enforce the guarantee to the extent of future indebtedness was to do no more than hold Vadasz to what he was prepared to undertake independently of any misrepresen~ - -

VICTORIA LAUNDRY (WINDSOR) LTD v NEWMAN INDUSTRIES LTD [1949] 2 KB 528 Court of Appeal, Civil Division (England and Wales)

[31 O]

Damages -

Consequential losses

FACTS Newman Industries sold a boiler to Victoria Laundry, and was aware that they wanted it for immediate use in their laundry and dyeing business. The boiler was delivered 20 weeks late, and Victoria Laundry claimed their lost profits for that period as damages.

FACTS Vimig executed an agreement to purchase a precision engineering business, and settled the transaction on the same day. It later claimed a right to rescind the agreement on the ground of misrepresentations in the business's accounts. ISSUE Would equity order rescission of an executed contract? DECISION Vimig failed. The rule in Seddon's case precluded rescission for innocent misrepresentation of an executed contract.

[312]

WALTONS STORES (INTERSTATE) LTD v MAHER (1988) 164 CLR 387; 76 ALR 513 High Court of Australia

Promissory or equitable estoppel FACTS Waltons negotiated the terms under which Mr and Mrs Maher would construct and lease to Waltons a new shop in Nowra which Waltons required to be available by 15 January 1984. The solicitors acting for Waltons forwarded a redrafted form of agreement, indicating that they believed that Waltons's approval would be forthcoming and that 'we shall let you know tomorrow if any amendments are not agreed to'. Nothing more was heard from Waltons. The Mahers executed the agreement and, on 11November1983, returned it by way of exchange. Waltons did not execute the agreement and, although they were aware that Mr Maher had started building, gave no indication that it did not intend to proceed with the transaction until 19 January 1984. By that time, the Mahers had demolished an old building, poured two-fifths of the concrete slab and laid 60 or 70% of the brickwork for the new shop. They sought a declaration that there was an agreement to take a lease, and specific performance or damages in lieu. ISSUE Was Waltons estopped from denying a binding agreement?

DECISION The Laundry was entitled to some general sum for loss of business in respect of contracts to be reasonably expected, since in the circumstances Newman Industries could reasomibly have foreseen that this loss was likely or liable to result from their deley.

DECISION Mr and Mrs Maher received damages. Waltons was estopped from retreating from its implied promise to complete the agreement, since it was unconscionable for Waltons, knowing that the Mahers were exposing themselves to detriment by acting on the basis of a false assumption, to adopt a course of inaction which encouraged them in the course they had adopted.

162

163

ISSUE What consequential losses were recoverable?

LexisNexis Case Summaries

Contracts

[313] WATT v WESTHOVEN [1933] VLR 458 Supreme Court of Victoria

[315] WESTMELTON (VIC) PTY LTD v ARCHER [1982] VR 305 Supreme Court of Victoria

Rescission for misrepresentation -

Sale of goods

FACTS Watt sued Westhoven for money owing from the sale of his car. Westhoven cross-claimed for rescission of the sale, on the ground that it was induced by innocent misrepresentations about the age, mileage and original cost of the car. ISSUE Was the equitable remedy of rescission available? DECISION Watt succeeded and the cross-claim failed. The Sale of Goods Act 19 28 (Vic) excluded equitable rules of rescission, and under common law rules Westhoven would only succeed if the misrepresentation was such that there was a complete difference in subject matter between the thing bargained for and that obtained so as to constitute a failure of consideration.

[314] WEST v AGC (ADVANCES) LTD (1986) 5 NSWLR 610 Supreme Court of New South Wales (Court of Appeal) Contracts review legislation FACTS AGC lent $68,000 to Mrs West for four years on the security of her home, with $29,800 of the money to be used to pay off her existing mortgage and the balance to be lent to The World of Quiche Pty Ltd. Quiche was the employer of Mrs West's husband, and she was led to believe it would use the money to expand its business, and that Quiche would pay the AGC instalments. In fact, it could not meet its existing debts and was soon wound up. AGC sought possession of Mrs West's home, and she sought relief under the Contracts Review Act 1980

(NSW). ISSUE Was the contract unjust? DECISION By majority: Relief against AGC was refused, since the deed of loan was not unjust in the circumstances when it was made. Mrs West executed the deed and mortgage with a full appreciation of the consequences and against the advice of her son, a trained accountant. They were ordinary commercial documents containing no unfair or unjust terms, and AGC was guilty of no unfair conduct towards her.

164

Undue influence -

Need for independent advice

FACTS Archer's firm provided legal services in the early stages of Westmelton's scheme for developing rural land into residential allotments. He agreed to reduce his firm's bill in return for an entitlement to 7\-7.% of Westmelton's profits before tax. In proceedings to enforce the agreement, ISSUE Could Archer rebut a presumption of undue influence? DECISION Archer's firm succeeded. Since the contract was one whereby solicitors took valuable rights from their client, there was a rebuttable presumption of undue influence. In the circumstances, Westmelton had more expertise in commerce and finance than most solicitors, and there was no obligation on the solicitors to obtain or advise the obtaining of independent legal advice. It could be concluded that no advantage was taken of the confidential relationship, the transaction was at arm's length, and Westmelton was in no way disadvantaged by the confidential relationship.

[316] WESTPAC BANKING CORPORATION vTANZONE PTY LTD [2000] NSWCA 25; (2000) 9 BPR 17;521 Supreme Court of New South Wales (Court of Appeal) Interpretation reading

Construction to avoid absurd effect of literal

FACTS Tanzone acquired land at Lithgow which was subject to a 20-year lease of a bank to Westpac commencing in 1985. Clause 2.01 of the lease provided for biennial rent increases calculated by multiplying the rent at the review date by either 8% compounded annually or, if it were greater, by the increase in the Consumer Price Index (CPI) since the last quarter preceding the commencement of the lease. Tanzone claimed that, read literally, the second of these calculations required rent increases of 68.5% in 1995, 81.45% in 1997 and 84% in 1999. ISSUE Could the literal meaning be avoided? DECISION Tanzone failed. The draftsperson made an obvious mistake by using a CPI multiplier related to the total period after the commencement of the lease, and this produced an absurd effect which was more than 165

LexisNexis Case Summaries

Contracts

mere unreasonableness. To avoid the absurdity and properly to reflect the intention of the parties gathered objectively from the whole context of the lease, the clause should be construed so that the CPI multiplier applied the increase in inflation since the last review date.

Edgley and Dawe claimed that this was a breach of the contract, ceased to appear in the revue, and sued for damages.

[317] WESTRALIAN FARMERS LTD v COMMONWEALTH AGRICULTURAL SERVICE ENGINEERS LTD (IN LIQ) (1936) 54 CLR 361 High Court of Australia Rights surviving a contractual termination FACTS Commonwealth Engineers imported American machinery and appointed Westralian as its Australian dealer. Westralian agreed to purchase a minimum quantity at a price payable in part to the American manufacturer on behalf of Commonwealth Engineers plus a percentage to Commonwealth Engineers, upon the arrival of each consignment at Fremantle. Pursuant to an express condition, the agreement 'immediately terminated and [was] at an end' upon the termination of Commonwealth Engineers' contract with the manufacturer. At the time of termination, Westralian had taken delivery in the United States of 32 tractors, but these arrived in Fremantle after that time. Westralian refused to pay Commonwealth Engineers its percentage. ISSUE Did the termination affect existing liabilities? DECISION By majority: Commonwealth Engineers recovered the specified amount. The termination operated only in so far as the agreement still remained executory. The provision concerning payment merely delayed or postponed payment, but did not affect the liability to pay the percentage arising out of an obligation which had arisen before the termination of the contract.

ISSUE What did 'sole professional services' mean? DECISION Edgley and Dawe recovered. Evidence of the intended service under the contract and the course of dealing between the parties was admissible to explain the meaning of the words 'professional services' as including engagement as producer.

[319] WHITE AND CARTER (COUNCILS) LTD v McGREGOR [1962] AC 413 House of Lords (UK) Repudiation of contract -

FACTS McGregor's sales manager engaged White and Carter to display advertisements on their litter bins for three years. McGregor repudiated the contract before the advertisements were prepared, but White and Carter did not accept this. They displayed the advertisements, and then sued for the full sum due under the contract. ISSUE Was White and Carter entitled to continue to perform the contract? DECISION By majority: White and Carter could recover under the normal principle that an innocent party may choose to disregard a repudiation, so that the contract survives, as an alternative to accepting the repudiation and suing for damages for breach of contract.

[320] WHITLOCK v BREW (1968) 118 CLR 445 High Court of Australia Uncertainty -

[318] WHITE v AUSTRALIAN AND NEW ZEALAND THEATRES LTD (1943) 67 CLR 266 High Court of Australia Extrinsic evidence to explain term FACTS The Theatre company agreed in writing to engage the 'sole professional services' of Edgley and Dawe White for 26 weeks. They produced and performed in a revue called Thumbs Up for some months, until the Theatre brought in Chapman to supervise the production. 166

Rights of innocent party

Severance

FACTS Brew agreed to buy land from Whitlock and paid a £15,600 deposit. In cl 5 of their agreement, Brew covenanted to grant a lease to the Shell Co of Australia over part of the land used as a garage, 'upon terms that the said land leased as aforesaid be used by Shell or their subtenant or licensee for the sale of such products and upon such reasonable terms as commonly govern such a lease'. Any dispute 'as to the interpretation or operation' of the clause was to be referred to an arbitrator. Brew later sued for the return of his deposit. ISSUE Was the contract void for uncertainty? 167

Contracts

LexisNexis Case Summaries DECISION Brew could recover his deposit on the basis that there was no concluded contract. Clause 5 was uncertain in that it neither specified, nor provided, a means for the determination as between the parties of the period for which the contemplated lease was to be granted or the rent to be payable. The clause was a material and inseverable part of the consideration, and the whole contract therefore fell.

[321]

WHITTET v STATE BANK OF NEW SOUTH WALES (1991) 24 NSWLR 146 Supreme Court of New South Wales

Estoppel by pre-contractual representations FACTS Mrs Whittet consented to a mortgage over her matrimonial

home, which was required by the State Bank as security for an overdraft for Mr Whittet's business. She insisted that the mortgage be limited to $100,000, but her solicitor allowed her to sign an unlimited document on the basis that he had an arrangement with the bank that it would not permit the principal to exceed $100,000. After some years, Mr Whittet suffered considerable losses on future exchange transactions, and the bank sold the property for $651,000, leaving Mrs Whittet with $50,000. ISSUE Was the bank estopped from relying on the terms of the

document? DECISION Mrs Whittet recovered damages from the State Bank and her solicitor. The bank was estopped against relying upon the unlimited terms of the document, upon the principle that an estoppel by convention can arise from pre-contractual negotiations where there was clear and convincing proof of the necessary facts.

[322] WIGAN v EDWARDS (1973) 1 ALR 497 High Court of Australia Consideration -

Compromise of dispute as to existing obligations

FACTS Mr and Mrs Edwards signed a contract to purchase a house from

its owner-builder, Mr Wigan. They later discovered several defects, which they told Wigan required attention before they would consider finalising the purchase. Wigan gave a written promise to rectify the defects and the contract was completed. Mr and Mrs Edwards sued for breach of Wigan's promise. 168

ISSUE Did Mr and Mrs Edwards give consideration for the promise? DECISION They were entitled to damages to be assessed on a retrial. There was consideration in the compromise by Mr and Mrs Edwards of their claim that they W€re not bound to perform the contract, which was a claim made honestly and bona fide and could not be described as frivolous or vexatious.

[323]

WILKINSON v OSBORNE (1915) 21 CLR 89 High Court of Australia

Contracts void under public policy FACTS Wilkinson was the agent for the owners of a property who wished to sell it to the New South Wales Government. The sale was subject to approval by resolution of both Houses of Parliament under the Closer Settlement Acts of 1907 and 1912. Wilkinson promised to pay £250 to Osborne and Jones, who were members of the Legislative Assembly, to exert political pressure on the government. Osborne and Jones later sued for their fee. ISSUE Was the contract contrary to public policy? DECISION Osborne and Jones failed, since the contract was void as against public policy. It was contrary to a principle of general recognition in the community as one essential to its corporate welfare, since it brought Osborne and Jones's personal interest into conflict with their duty as Members of Parliament.

[324] WILLIAMS v ROFFEY BROS & NICHOLLS (CONTRACTORS) LTD [1991] 1 QB 1 Court of Appeal, Civil Division (England and Wales) Consideration for a promise of extra remuneration FACTS Roffey engaged Williams to carry out carpentry work in the refurbishment of a block of 27 flats, for a total price of £20,000. Roffey later promised to pay an extra £10,300 at the rate of £575 per completed flat, since Williams was in financial difficulties as a result of the price being unreasonably low, and Roffey was concerned to have the carpentry completed on time. Williams ceased work after payments ceased, and he sued for outstanding instalments. ISSUE Did Williams give consideration for the additional price?

169

LexisNexis Case Summaries DECISION Williams succeeded. There was consideration for the promise of additional payments, since Roffey had obtained a commercial advantage, and there was no suggestion that the promise was given as a result of economic duress or fraud on the part of Williams.

[325]

J C WILLIAMSON LTD v LU KEY AND MULHOLLAND (1931) 45 CLR 282 High Court of Australia

Specific performance -

Injunctions

FACTS Lukey and Mulholland agreed orally with J C Williamson Ltd to have an exclusive right to sell confectionery, ice-cream and non-intoxicating drinks to members of the audience in Williamsons' theatre. Lukey and Mulholland's employees came under the control and supervision of the theatre management when making sales. Williamsons terminated the theatre rights before its expiry date, and Lukey and Mulholland sued for damages. They were prevented by the Statute of Frauds from recovering at common law, but they argued that their acts of part performance allowed equitable relief, and that in lieu of such relief they could have damages under Lord Cairns' Act. ISSUE Was any form of equitable relief available? DECISION Lukey and Mulholland's action failed, since no equitable relief was available. An order for specific performance was inapplicable, because the continued supervision of the court would be necessary in order to ensure the fulfilment of the agreement, and, in the circumstances, the court would also not grant an injunction.

[326)

WOODAR INVESTMENT DEVELOPMENT LTD v WIMPEY CONSTRUCTION UK LTD [1980] 1 WLR 277; [1980] 1 All ER 571 House of Lords (UK)

Repudiation -

Mistaken reliance on a rescission condition

Contracts ISSUE Did Wimpey's conduct amount to repudiation? DECISION By majority: Woodar failed. Wimpey's mistaken reliance on the rescission condition manifested no intention to abandon, or to refuse further performance of, or to repudiate, the contract.

[327) YANGO PASTORAL CO PTY LTD v FIRST CHICAGO AUSTRALIA LTD (1978) 139 CLR 41 O; 21 ALA 585 High Court of Australia Contract made in course of illegal business FACTS First Chicago sued Yango for $132,600 due under a personal covenant m a mortgage. Yango raised a defence that the mortgage was rendered illegal and void or was unenforceable, by reason of s 8 of the Banking Act 19~9 (Cth) which prohibited and penalised the carrying on of an unauthonsed banking business in Australia. ISSUE Was the mortgage enforceable? DECISION Yango's defence failed. On its proper construction s 8 did not proh ib.it and invalidate contracts made by a company i~ the course of carrying on a banking business in breach of the section and cons.iderations_ of public po~icy operated so as to make inapplicabl~ the maxim ex turpi causa non ontur actio.

[328) YERKEY v JONES (1939) 63 CLR 649 High Court of Australia Undue influe~ - Voluntary guarantee by wife for husband FACTS Mrs Jones was ~rsuaded by her husband to sign a mortgage over _her home at Walkerville in South Australia, as security for his purchase of a_P.oultry farm from Mr and Mrs Yerkey. She was later sued for the debt secured. ISSUE Would equity set aside the mortgage?

FACTS Wimpey contracted to buy Woodar's land at Cobham, but later purported to rescind the contract pursuant to a condition allowing rescission if an authority commenced procedures for compulsory acquisition of the land. Woodar disputed Wimpey's right to rescind, and its view was upheld in court. Woodar then claimed damages on the basis that Wimpey had repudiated the contract.

DECISION Mrs Jones had not made out a case for equitable relief and was liable. No presumption existed of undue influence by a husband on a wife, and the evidence did not show that Mrs Jones had acted und~ coercion or fraud, or had misunderstood the substantial effect of the obligations she was undertaking.

170

171

LexisNexis Case Summaries

Index

[329] YOUNG v QUEENSLAND TRUSTEES LTD (1956) 99 CLR 560 High Court of Australia Recovery of money due under contract FACTS The executor of Mrs Halley's estate sued Mr Young for £11,661 10s owing under loan agreements. Mr Young admitted the loans, but claimed to have repaid Mrs Halley during her lifetime. His evidence was disbelieved by the trial judge. ISSUE Did the executor need evidence which disproved repayment? DECISION The executor obtained judgment. There is no burden on a plaintiff to disprove payment of money immediately owing under contract, and it lies upon a defendant to make out a defence of payment by way of discharge.

References are to case numbers A

online auction .... 280 place .... 50 prior dealings .... 26, 117, 150, 255 public notice .... 26 subject to contract .... 134, 206, 271 ticket conditions .... 221

Abandonment of contract .... 106, 122 Acceptance see also Agreement; Mistake; Unilateral contract auctions .... 86 conduct, by .... 26, 46, 89, 196 counter offer .. .. 60 eBay bid .... 280 mode .... 200 posted .... 181, 286 self-service shop .... 236 silence .... 114, 118 telex .... 50 ticket machine .... 300 time for .. .. 103 unqualified .... 2 71

Auction see Acceptance

Accord and satisfaction see Consideration

8

Agency misleading conduct .... 59

Bailment see Exemption clause; Implied term; Quantum meruit

Agent see also Assignment; Privity authority to sign .... 112 contracting for principal .... 303 fiduciary .... 194 misrepresentation of authority .... 270 ostensible authority .... 22 7

Breach anticipatory .... 152

Arbitration clause see Repudiation; Rescission Assignment agency or .... 87 assignable rights .... 226 equitable .... 69 implicit intention .... 302 subject to set-off .... 139

Breach of contract affirming party, by .... 43 anticipatory .... 43, 124, 191, 203, 234,249,306 confidentiality undertaking .... 16 recovery of money due .... 329 relief from forfeiture .... 9, 179, 193,285

Agreement see also Acceptance; Intention; Mistake; Offer; Uncertain contract battle of forms ... . 60 by estoppel.. .. 312, 321 consensus ad idem .... 278 delivery note .... 255 discrepant counterparts .... 277 negotiations or .. .. 76, 134, 267, 268,271 novation .... 226 172

c Capacity see Infants; Insanity; Unconscionable transaction Certainty see Consideration; Uncertain contract Collateral contract see also Consideration 173

Index

LexisNexis Case Summaries

certainty . . . . 109 cohabitation .... 240 collateral arrangement .... 158, 217, 228 commercial advantage .... 213, 324 detriment .... 31 existing duty .... 109, 133, 213, 219,228,287,290,324 forbearance .... 109 form of.. .. 66, 73, 216, 228 illusory promise .... 36, 109, 196, 219 immoral .. .. 11 part payment of debt. ... 123, 166, 213 past .... 66, 69, 72, 110, 228, 258 promisee, from .. .. 87, 108, 216 quid pro quo .... 31 requested .... 23 required .... 110 total failure .... 27, 41, 119, 260, 292, 313 value .... 73

Collateral contract - cont'd foundation of transaction .... 27 2 negotiations .... 267 reference to other documents .... 273 requirements .... 158, 128 Competition and Consumer Act see Trade Practices Act Condition see also Agreement; Exemption clause; Frustration advance payment .... 27 allowing rescission .... 12, 197 automatic termination .... 257 confidentiality .. . . 1, 16 dependent promise .... 93, 139 dispute resolution procedure ... . 4 entire contract .... 39, 93, 151 essential term .... 14, 35, 56, 17 4, 191,203,250, 274 exclusive jurisdiction .. .. 221 good faith .... 76 intermediate term .... 56, 71, 155, 174 mutual promises .... 41 notification . . . . 12 performance dispensed . . . . 199 precedent to contract ... . 207 precedent to litigation .... 4 precedent to obligation .... 41, 43, 208, 232 precedent to recovery .... 35, 41, 64,93, 289 precedent to rescission .. ... 124, 197 subsequent ... . 136, 207, 291 substantial performance .... 39 time for completion ... . 269 time for performance .... 56, 64, 124, 164, 232 void or voidable effect .... 232, 257,291 waived .... 68, 124, 151, 153, 199, 200,234,265,291,305 Consideration accord and satisfaction .... 123, 192,322

Contracts Review Act see Unconscionable transaction D Damages see also Penalty; Trade Practices Act account of profit .... 16 after rescission .... 244 anticipatory breach .... 153, 306 causation .. .. 7, 80, 148, 205, 230, 252,276 consequential advantage .... 52 consequential loss .... 195, 248, 252, 288,310 contingencies .. .. 212 contributory negligence .... 15 date of assessment .... 104, 167, 169, 248 defective building .... 33 defective work .... 39 delayed delivery ... . 175 distress and disappointment .... 27, 165

double compensation .... 27 employment .... 24, 188 fraud .... 80, 128, 138, 144, 154 general principles .... 81, 153, 159, 169, 248, 310 liquidated .... 9, 107, 153, 213 lost chance .... 81, 157 lost expenditure .... 58, 81, 195 lost interest .... 159 lost opportunity .... 270 lost profit .... 58, 163, 230, 288, 310 mitigation .... 52, 58, 276 nominal .... 36, 128, 154, 191, 248 non-delivery .... 80 novus actus ....

economic .... 18, 145, 219, 228, 307,324 election to affirm .... 145 inducement .... 30 personal .... 30 prosecution threat .... 264 voidable contract .... 145 waived .... 219

E Election see Condition; Duress; Repudiation; Rescission Employment see Damages; Frustration; Implied term; Quantum meruit; Restraint of trade; Specific performanc~; Uncertain contract; Variation

7

only remedy .... 24, 35, 41, 71, 209 party in breach .. .. 84 personal injuries .... 169 reasonably contemplated .... 288 rectification costs .... 33, 248 reliance ... . 81 remoteness ... . 7, 58, 175, 230 repairs . . . . 104 repudiation, after .... 74 rescission, after .... 9, 68, 274, 318 restitution .... 27 restitution .... 16 Trade Practices Act .... 128, 147, 212, 270 unavailable .... 197

Entire contract see Condition; Quantum meruit Estoppel common law .... 77 conduct before contract .... 283, 321 conduct, by .... 3 7, 82 convincing proof .... 321 detriment .... 30, 132, 166 equitable .... 72, 132, 166, 179, 209,283,312 equitable remedies .... 132 lower rent .. . . 166 ostensible authority .... 227 proprietary interest .... 132 unequivocal conduct .... 145, 179, 209 waiver or .... 82

Death performance after .... 87 Delay see Abandonment; Acceptance, Damages; Frustration; Repudiation ; Specific performance

Exemption clause bailee's agent .... 216 bailment .... 97, 293 construction .... 6, 94, 97, 237, 293,299 fundamental breach .... 23 7, 241, 293,299 limited liability .... 6 misrepresented .... 92

Deposit see Penalty; Restitution Duress see also Rescission; Unconscionable transaction; Undue influence additional remuneration .... 324

References are to case numbers

References are to case numbers

174

175

LexisNexis Case Summaries

Exemption clause - cont'd negligence .... 6, 97, 293 notice .... 70, 229, 300, 303 oral terms .... 86, 117 outside contract .... 70, 92, 117, 150, 221,255,300 ticket .... 70, 92, 97, 150, 196, 221,229, 293,300 total exclusion .... 196 Extrinsic evidence see Intention; Interpretation; Written contract F Fraud see Damages; Exemption clause; Illegal contract; Misrepresentation; Sale of goods

Frustration delay .... 31, 98, 164 destruction of subject .... 120, 176,296 employment .... 275 express terms .... 28, 31, 317 lease .... 120, 215 performance different .... 28, 51, 78, 98, 215 performance impossible .... 13, 119, 249 performance unlikely . . . . 113 recovery after . . . . 13, 119, 31 7 self-induced .... 204 time charter .... 173 war .... 113, 173

H

Illegal contract see also Penalty conditional .... 129 effect on title .... 264 executory .... 75 fraudulent scheme .... 8 immorality .... 11 knowledge .... 144 misrepresentation .... 144 non-contractual remedy ... . 44, 45, 144,231,264, 298 ouster of jurisdiction .... 53 performance illegal .. . . 121, 218, 263 preventing prosection .... l, 62, 75, 75,264 prohibited business .... 327 protective statute .... 172, 282 public duties .... 133 public policy .... 1, 121, 323, 327 recovery of money .... 62, 75, 95, 121, 129, 172, 218,231, 282 rule against perpetuities .... 142 severance .... 53, 67, 298 statutory prohibition .... 44, 45, 67, 129, 144, 263,327 unequal fault .... 11, 62, 75, 129, 172,282 Illusory promise see Consideration; Uncertain contract Implied term see also Sale of goods bailment ... . 100 cooperation .... 57, 269 custom .... 61 custom or usage .... 85 employment .... 24, 61, 84 excluded . . . . 146 existence of subject .... 135, 195 fitness for purpose .... 100, 141 good faith .... 57, 127, 269 implied by law .... 61, 141 landlord's repairs .... 185 necessity .... 26, 57, 61, 78, 185, 210 personal performance .... 53

G Guarantee equitable relief .... 79, 309 letter of comfort or ... . 29 misrepresented .... 309 principal contract altered .... 12 principal contract rescinded .... 160, 193 special character .... 79 strict construction . . . . 12 sufficient memorandum .... 143 unenforceable against wife .... 126

Index

quality of goods .... 146 reasonable care and skill ... . 141 reasonable exercise of powers .... 57 reasonable notice .... 88 reasonable steps ... . 40 reasonableness .... 254 reliance on skill .... 252 remuneration .... 24, 69 safe premises .... 210 termination .... 88, 301 time for performance ... . 64 warranty .... 273

Uncertain contract; Written contract absurd effect .... 316 ambiguity .... 19, 46, 191, 261, 308,318 conflicting forms .... 60, 86 exemption clause .... 94 factual matrix .... 46, 78, 250 literal meaning .... 19, 316 oral statements .... 86, 92, 117 surrounding circumstances .... 22 7 termination clause .... 257

L

Infants necessaries .... 214

Landlord and tenant see Estoppel; Implied term; Intention; . Frustration; Restraint of trade; Statute of Frauds

Injunction discretionary .... 325 negative promise .... 91 negative stipulation .... 190

Limitation clause see Exemption clause

Insanity . . . . 130 Intention advertising puff .... 66 contractual statement .... 267 exchange of counterparts .... 2 77 expressly negatived .... 259 extrinsic evidence .... 46, 115, 271 family arrangement .... 25, 170, 240,301 government benefits .... 3, 23, 239 identity of party .... 90 letter of comfort .... 29 minister of religion .... 115 non-contractual offer .... 3, 131, 209 objective/subjective .... 297 promissory language .... 29 provisional agreement .... 206 reliance on offer .... 89 subsequent conduct .... 271 welfare tenancy .... 185

M Misrepresentation see also Illegal contract; Sale of goods contractual term, of .... 92 description .... 225 disclaimer .... 80 equitable relief .... 309 fact or law .... 245 fact or opinion .... 37 fraud, rescission for .. .. 5, 55, 65, 77, 182 fraudulent ... . 101, 111, 138, 154 future conduct ..... 125, 294 inducement .... 111, 138, 251 innocent, rescission for .... 178, 309, 311, 313 intention . . . . 101, 111 negligent .... 272 onus of proof .... 251 opinion .... 279 opportunity to discover .... 251 release of rights ... . 192 reliance .... 125, 154, 251 rescission .... 3 7, 183

Interpretation see also Exemption clause; Guarantee; Intention; Mistake; Restraint of trade;

References are to case numbers

References are to case numbers

176

177

LexisNexis Case Summaries

Misrepresentation - cont'd rescission for fraud .. .. 245 rescission for innocent .... 251 rights excluded . . . . 183 silence .... 79, 96, 99, 147, 272, 278 Trade Practices Act .... 2, 59, 99, 125, 128, 147,294 warranty or .... 102 Mistake existence of subject .... 195 fact or law .. .. 95, 281 identity of borrower .... 242 identity of party .... 90, 182 meaning of contract .... 136, 180, 297,316 money paid .... 95 mutual .... 249 mutual assumption . . . . 140 non est factum .... 233, 266 quality of subject .... 32, 225, 278,292 rescission for .... 281, 292, 297 rescission in equity .... 140 terms of contract .... 202

N Negligence see Exemption clause; Misrepresentation

exercise .... 181 irrevocable offer .. .. 136 terms to be agreed .... 40 p

Penalty accelerated rent .... 222 deposit or .... 42 liquidated damage or .... 9, 107, 116, 213, 222, 256 recovery of instalments .... 193 relief .. .. 9 Privity of contract contracting for agent ... . 216, 241 insurance .... 304 third person benefit .... 34, 87, 108,304 Q Quantum meruit after frustration .... 98 assessment .... 4 7, 254 entire contract .... 13, 39, 93, 151, 284,289 frustration, after .. .. 78 services rendered .... 4 7 unenforceable contract .... 231 work done .... 254, 284

Quasi-contract see Restitution

Non est factum see Mistake

R

Notice to complete see Rescission

Rectification see Written contract

0 Offer see also Intention; Unilateral contract advertisement .... 66, 89 counter-offer .... 60, 286 eBay listing .... 280 invitation to treat or .... 131 rejected .... 46 ticket .... 229, 196 withdrawn .... 286, 136, 118, 103

Relief from forfeiture see Breach of contract; Penalty; Specific performance; Unconscionable transaction Repudiation see also Damages acts of .. .. 35, 77, 106, 167, 177, 201, 203, 226,244,274 arbitration clause .... 149 delay .... 177 disputed interpretation .... 106, 326 effect .... 149

Option see also Acceptance consideration .... 103

Index

election to affirm .... 24, 43, 74, 319 not accepted .... 74, 191 quantum meruit after .... 254 recovery for work done .... 289 remuneration after .... 74 rescission clause .... 153, 326 rights surviving .... 139 wrongful rescission .... 81, 155

recovery of arrears .... 54 restitutio in integrum .... 5, 193 rights surviving .... 42, 54, 160, 193,237,317 time of essence .... 295, 305 Trade Practices Act .... 99 unconscionable transaction .... 38, 297, 309 wrong reason .... 84, 203, 232

Rescission see also Damages; Misrepresentation; Mistake after specific performance .... 167 alternative rights .... 153, 319 anticipatory breach .... 124, 152 arbitration clause, and .... 149 breach entitling .... 12, 14, 35, 68, 71, 106, 155, 174, 177, 186, 191,201,306 communication .... 65 compensation .... 55 contractual right .... 54, 162, 249, 257,265,326 damages, and ... . 274 declaration .... 5, 38, 55, 193, 249,251 declaration and compensation .... 193 election .... 232, 305 election to affirm .... 68, 77, 162, 183,257,265,291 equitable relief .... 249 executed contract .... 178, 292, 311 executory contract ... . 77 express right .... 9, 153, 232, 244, 274 hire-purchase contract ... . 54 implied right .... 84, 88 instalment contract .... 160, 193, 249 knowledge of rights .. .. 77 manner .... 65, 77 misrepresentation .... 3 7 notice to complete .... 177, 186, 232 only remedy .... 197

Restitution see also Illegal contract; Penalty; Quantum me~it conditional payment .... 27 deposit . . . . 106 failure of consideration .... 27, 260 instalments .... 193 money had and received .... 119 money paid by mistake .. .. 95, 242 money paid under duress .... 290, 307 subcontractor's claim ... . 189 work before contract .... 262 work benefiting .. .. 189 Restraint of trade confidentiality agreement .... 198 construction .... 235 employment .... 48, 91, 184 enforcement .... 10, 91 geographic scope . . . . 184, 21 7, 235 justification .... 198 lease covenants . . . . 10 legislation validating .... 224 reasonableness .. .. 10, 17, 91, 198 severance .... 17, 235 solicitor's practice .... 48

s Sale of goods see also Damages; Frustration; Implied term exclusion of warranty .... 180 existence of goods .... 135 fimess for purpose . . . . 163 fraudulent purchaser .... 90

References are to case numbers

References are to case numbers

178

179

Index

LexisNexis Case Summaries Sale of goods - cont'd misrepresentation .... 65, 178, 225, 313 specific performance .... 105 specified goods .... 135

T

Sale of land see also Specific performance collateral contract .... 273 time for completion .... 64, 295

Termination see Rescission

Sale of Land completed contract ... . 292 Severance see Condition; Illegal contract; Restraint of trade; Uncertain contract Specific performance see also Injunction annuity .... 34 conditional contract .... 105 damages or .... 209 delay .... 122 employment .... 188 equitable defences .... 38, 245, 279,297 limited decree .... 40 misrepresentation .... 279 mutuality .... 243 personal service . . . . 190 precondition dispensed .... 199 relief against forfeiture .... 285, 295 requiring supervision .... 243, 325 rescission after .... 167 sale of chattel .... 105, 280 scope .... 105 Statute of Frauds agreement to lease .... 238 connected documents .... 112,

Term see Agreement; Condition; Exemption clause; Frustration; Implied term; Misrepresentation; Uncertain contract; Warranty

Ticket see Acceptance; Exemption clause; Offer Time see Acceptance; Condition; Implied term; Rescission Trade Practices Act continuing losses .... 212 contributory conduct .... 148, 161 damages .... 128, 147, 148, 161, 205,270 disclaimer .... 59 future matter .... 294 inaccurate warranty .... 2 injunctive relief .... 63 limitation period .... 212 loss or damage .... 99, 212 misleading or deceptive .... 59, 63 misleading or deceptive conduct .... 2, 99, 125, 128, 147, 205, 209 other orders .... 99, 147, 161, 205 public audience .... 63 trade or commerce .... 83, 220 unconscionable conduct .... 20, 21, 22, 127 voiding contract .... 99

u Uncertain contract arbitration provided .... 40 employee share scheme .. .. 36 good faith negotiations

.... 4

143

illusory agreement .... 208 illusory promise .... 76, 209, 239 imprecise language .... 308 language .... 192 meaningless term .... 109, 239 mediation agreement .... 4 severance .... 183, 320

guarantee .... 143 oral variation .... 211 part performance .... 223, 253 recovery .... 231 signature .... 112, 238 sufficient memorandum .... 112, 238,240

References are to case numbers

180

v

subject to finance .... 208 subjective term .... 208 terms to be agreed .... 40, 76, 134, 268, 320 unascertainable price .... 142

Variation by conduct .... 219 consideration .... 213, 219, 290 continuing rights .... 84 novation or .... 211

Unconscionable transaction see also Duress; Undue influence advantage of weakness .... 38, 79, 187 Contracts Review Act .... 18, 314 equitable relief .... 49, 187, 309 improvident transaction .... 49 relief against forfeiture .... 285, 295 special disadvantage .... 20 Trade Practices Act .... 18, 20, 21, 22, 127 unfair bargain .... 38, 297 wife's guarantee .... 126 wife's signature .... 328

w Waiver see Breach; Condition; Election; Estoppel Warranty see also Collateral contract; Implied terms; Misrepresentation after contract .... 258 description .... 102, 225, 250 description of services .... 165 implied .... 273 informal agreement .... 86 misleading conduct .... 2 misrepresentation or .... 102 plan of subdivision .... 273 pre-contractual opinion .... 267 rescission .... 71

Undue influence see also Duress; Unconscionable transaction full disclosure .... 194 husband over wife .... 328 independent advice .... 38, 315 onus of proof .... 168, 315 relationship of confidence .... 38, 168, 194, 316, 328

Written agreement binding record .... 183, 266 Written contract see also Collateral contract; Interpretation binding record .... 136, 137, 180, 247 extrinsic evidence .... 78, 86 156 228,247,250,261,283,3i8, ' 321 objective construction .... 227 partly oral .... 283 rectification .... 171, 202, 246, 316 signature .... 380, 303 unsigned .... 114 whole agreement clause .... 156

Unilateral contract acceptance .... 66, 196 announcement .... 89, 209 announcement by government .... 23 formation .... 66 reliance on offer .... 89 standing offer .... 23 withdrawn offer .... 209

References are to case numbers

181