Contracts

99 Pages·2011·48.011 MB·English

by  Mathew Smith

LexisNexis
Contents
AUSTRALIA LexisNexis Butteiworths
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On the internet at: www.lexisnexis.com.au
ARGENTINA LexisNexis Argentina, BUENOS AIRES
AUSTRIA LexisNexis Verlag ARD Orac GmbH & Co KG, V1ENNA
BRAZIL LexisNexis Latin America, SAO PAULO Case Number Case Name
CANADA LexisNexis Canada, Markham, ONTARIO
Av Hayden (No 2)
CHILE LexisNexis Chile, SANTIAGO
2
CHINA LexisNexis China, BEIJING, SHANGHAI Accounting Systems 2000 (Developments)
CZECH REPUBLIC Nakladatelstvi Orac sro, PRAGUE Pty Ltd v CCH Australia Ltd
1
FRANCE LexisNexis SA, PARIS 3
GERMANY LexisNexis Germany, FRANKFURT Administration of the Territory of Papua
HONGKONG LexisNexis Hong Kong, HONG KONG and New Guinea v Leahy 2
HUNGARY HVG-Orac, BUDAPEST 4
Aiton Australia Pty Ltd v Transfield Pty Ltd 2
INDIA LexisNexis, NEW DELHI
5 Alati v Kruger
ITALY Dott A Giuffre Edi tore SpA, MtLAN 3
JAPAN LexisNexis Japan KK, TOKYO 6 Alderslade v Hendon Laundry Ltd 3
KOREA LexisNexis, SEOUL 7
MALAYSIA LexisNexis Malaysia Sdn Bhd, PETAUNG 1AYA, SELANGOR Alexander v Cambridge Credit Corp Ltd 4
NEW ZEALAND LexisNexis, WELLINGTON 8 Alexander v Rayson 4
POLAND Wydawnictwo Prawnicze LexisNexis, WARSAW 9
SINGAPORE LexisNexis, SINGAPORE Amev-UDC Finance Ltd v Austin 5
10
SOUTH AFRICA LexisNexis Butteiworths, DURBAN Amoco Australia Pty Ltd v Rocca Bros
SWITZERLAND Staempfl.i Verlag AG, BERNE Motor Engineering Co Pty Ltd 5
TAIWAN LexisNexis, TAIWAN 11
Andrews v Parker
UNITED KINGDOM LexisNexis UK, LONDON, EDINBURGH 6
USA LexisNexis Group, New York, NEwYoRK 12 Ankar Pty Ltd v National Westminster
LexisNexis, Miamisburg, OHIO Finance (Aust) Ltd
6
National Library of Australia Cataloguing-in-Publication entry 13 Appleby v Myers 7
14
Author: Smith, Matthew. Associated Newspapers Ltd v Bancks 7
Title: Contracts. 15 Astley v Austrust Ltd 8
Edition: 7th edition. 16
Attorney General v Blake 8
ISBN: 9780409327823 (pbk).
17
9780409329032 ( ebook). Attwood v Lamont 9
Series: LexisNexis Case Summaries. 18 Australia and New Zealand Banking
Notes: Includes index. Group v Karam
9
Subjects: Contracts -Australia - Cases. 19
Australian Broadcasting Commission
Dewey Number: 346.9402.
v Australasian Performing Right Association Ltd 10
20
© 2011 Reed International Books Australia Pty Limited trading as LexisNexis. Australian Competition and Consumer
First edition 1984; second edition 1988; third edition 1991; fourth edition 1995; fifth Commission v C G Berbatis Holdings Pty Ltd 11
edition 1999; reprinted 2002, sixth edition 2004. 21 Australian Competition and Consumer
This book is copyright. Except as pennitted under the Copyright Act 1968 (Cth), no part Commission v Samton Holdings Pty Ltd 11
of this publication may be reproduced by any process, electronic or otheiwise, without 22
Australian Competition and Consumer
the specific written permission of the copyright owner. Neither may information be stored
electronically in any form whatsoever without such permission. Commission v Simply No-Knead (Franchising)
Pty Ltd
Inquiries should be addressed to the publishers. 12
23
Australian Woollen Mills Pty Ltd
Typeset in Goudy and Helvetica.
v Commonwealth 13
Printed in China. 24
Automatic Fire Sprinklers Pty Ltd
Visit LexisNexis Butteiworths at www.lexisnexis.com.au
v Watson 13
iii
LexisNexis Case Summaries Contents
Case Number Case Name Case Number Case Name
~ Balfour v Balfour 14 56 Bunge Corporation v Tradax SA 30
26 Balmain New Ferry Co Ltd v Robertson 14 57 Burger King Corporation v Hungry Jack's Pty Ltd 30
27 Baltic Shipping Co v Dillon 15 58 Burns v Man Automotive (Aust) Pry Ltd 31
28 Bank Line Ltd v Arthur Capel and Co 15 59 Butcher v Lachlan Elder Realty Pry Ltd 32
29 Banque Brussels Lambert SA v Australian 60 Butler Machine Tool Co Ltd v Ex-Cell-O Corp
National Industries Ltd 16 (England) Ltd 32
30 Barton v Armstrong 16 61 Byrne and Frew v Australian Airlines Ltd 33
31 Beaton v McDivitt 17 62 Callaghan v O'Sullivan 34
32 Bell v Lever Brothers Ltd 17 63 Campomar Sociedad Limitada v Nike
33 Bellgrove v Eldridge 18 International Ltd 34
34 Beswick v Beswick 18 64 Canning v Temby 35
35 Bettini v Gye 19 65 Car and Universal Finance Co Ltd v Caldwell 35
36 Biotechnology Australia Pty Ltd v Pace 19 66 Carlill v Carbolic Smoke Ball Co 36
37 Bisset v Wilkinson 20 67 Carney v Herbert 36
38 Blomley v Ryan 21 68 Carr v J A Berriman Pty Ltd 37
39 ~olton v Mahadeva ) [ 21) 69 Casey's Patents, Re 37
40 ooker Industries Pty Ltd v Wilson Parking 70 Causer v Browne 38
(Qld) Pty Ltd 22 71 Cehave NV v Bremer Handelsgesellschaft mbH;
41 Boone v Eyre 22 the Hansa Nord 38
42 Bot v Ristevski 22 72 Central London Property Trust Ltd v High Trees
43 Bowes v Chaleyer 23 House Ltd 39
44 Bowmakers Ltd v Barnet Instruments Ltd 23 73 Chappell & Co Ltd v Nestle Co Ltd 39
45 Bradshaw v Gilbert's (Australasian) Agency 74 Clea Shipping Corp v Bulk Oil International Ltd 40
(Vic) Pty Ltd 24 75 Clegg v Wilson 40
46 Brambles Holdings Ltd v Bathurst City Council 25 76 Coal Cliff Collieries Pty Ltd v Sijehama Pty Ltd 41
47 Brenner v First Artists' Management Pty Ltd 25 77 Coastal Estates Pty Ltd v Melevende 41
48 Bridge v Deacons 26 78 Codelfa Construction Pry Ltd v State Rail
49 Bridgewater v Leahy 26 Authority of New South Wales 42
50 Brinkibon Ltd v Stahag Stahl Und 79 Commercial Bank of Australia Ltd v Amadio 42
Stahlwarenhandelsgesellschaft mbH 27 80 Commercial Banking Co of Sydney Ltd
51 Brisbane City Council v Group Projects Pry Ltd 27 v R H Brown & Co 43
52 British Westinghouse Electric and Manufacturing 81 Commonwealth of Australia v Amann
Co Ltd v Underground Electric Railways Co of Aviation Pry Ltd 44
London Ltd 28 82 Commonwealth of Australia v Verwayen 44
53 Brooks v Bums Philp Trustee Co Ltd 28 83 Concrete Constructions (NSW) Pty Ltd v Nelson 45
54 Brooks v Beirnstein 29 84 Concut Pry Ltd v Worrell 46
55 Brown v Smitt 29 85 Con-Stan Industries of Australia Pty Ltd
v Norwich Winterthur Insurance (Aust) Ltd 46
iv v
LexisNexis Case Summaries Contents
Case Number Case Name Case Number Case Name
86 Couchman v Hill 47 115 Ermogenous v Greek Orthodox Community
87 Coulls v Bagot's Executor and Trustee Co Ltd 47 of SA Inc 61
88 Crawford Fitting Co v Sydney Valve 116 Esanda Finance Corporation Ltd v Plessnig 61
& Fittings Pty Ltd 48 117 J Evans & Son (Portsmouth) Ltd v Andrea
89 The Crown v Clarke 48 Merzario Ltd 62
90 Cundy v Lindsay 49 118 Felthouse v Bindley 62
91 Curro v Beyond Productions Pty Ltd 49 119 Fibrosa Spolka Akcyjna v Fairbairn Lawson
92 Curtis v Chemical Cleaning and Dyeing Co Combe Barbour Ltd 63
~~ 120 Firth v Halloran 63
93 Cutter v Powell
94 Darlington Futures Ltd v Delco Australia Pty Ltd 51 121 Fitzgerald v F J Leonhardt Pty Ltd 64
95 David Securities Pty Ltd v Commonwealth 122 Fitzgerald v Masters 64
Bank of Australia 51 123 Foakes v Beer 65
96 Davies v London and Provincial Marine 124 Foran v Wight 65
Insurance Co 52 125 Futuretronics International Pty Ltd v Gadzhis 66
97 Davis v Pearce Parking Station Pty Ltd 52 126 Garcia v National Australia Bank Ltd 66
98 Davis Contractors Ltd v Fareham Urban District 127 Garry Rogers Motors (Aust) Pty Ltd v Subaru
Council 53 (Aust) Pty Ltd 67
99 Demagogue Pty Ltd v Ramensky 53 128 Gates v City Mutual Life Assurance Society Ltd 68
100 Derbyshire Building Co Pty Ltd v Becker 54 129 George v Greater Adelaide Land Development
101 Derry v Peek 54 Co Ltd 68
102 Dick Bentley Productions Ltd v Harold Smith 130 Gibbons v Wright 69
(Motors) Ltd 55 131 Gibson v Manchester City Council 69
103 Dickinson v Dodds 55 132 Giumelli v Giumelli 69
104 Dodd Properties (Kent) Ltd v Canterbury 133 Glasbrook Bros Ltd v Glamorgan County
City Council 56 Council 70
105 Dougan v Ley 56 134 Godecke v Kirwan 71
106 DTR Nominees Pty Ltd v Mona Homes Pty Ltd 57 135 Goldsbrough Mort & Co Ltd v Carter 71
107 Dunlop Pneumatic Tyre Co Ltd v New Garage and 136 Goldsbrough Mort & Co Ltd v Quinn 72
Motor Co Ltd 57 137 Gordon v MacGregor 72
108 Dunlop Pneumatic Tyre Co Ltd v Selfridge 138 Gould v Vaggelas 73
and Co Ltd 58 139 Government of Newfoundland v Newfoundland
109 Dunton v Dunton 58 Railway Company 73
110 Eastwood v Kenyon 59 140 Great Peace Shipping Ltd v Tsavliris Salvage
111 Edgington v Fitzmaurice 59 (International) Ltd 74
112 Elias v George Sahely & Co (Barbados) Ltd 59 141 Greaves & Co (Contractors) Ltd v Baynham
113 Embiricos v Sydney Reid & Co 60 Meikle and Partners 75
114 Empirnall Holdings Pty Ltd v Machon 142 Hall v Busst 75
Paull Partners Pty Ltd 60 143 Harvey v Edwards, Dunlop and Co Ltd 76
vi vii
LexisNexis Case Summaries Contents
Case Number Case Name Case Number Case Name
144 Hatcher v White 76 173 Kodros Shipping Corporation of Monrovia
145 Hawker Pacific Pty Ltd v Helicopter v Empresa Cubana De Fletes
91
Charter Pty Ltd 77 174 Koompahtoo Local Aboriginal Land
146 Helicopter Sales (Aust) Pty Ltd Council v Sanpine Pty L~ 92
v Rotor-Work Pty Ltd 77 175 Koufos v C Czamikow Lt 92
147 Henjo Investments Pty Ltd v Collins 176 Krell v Henry ...2L
Marrickville Pty Ltd (No 1) 78 177 Laurinda Pty Ltd v Capalaba Park Shopping
148 Henville v Walker 78 Centre Pty Ltd 93
149 Heyman v Darwins Ltd 79 178 Leason Pty Ltd v Princes Farm Pty Ltd 94
150 DJ Hill & Co Pty Ltd v Walter H Wright 179 Legione v Hateley 94
Pty Ltd 79 180 L'estrange v F Graucob Ltd 95
151 Hoenig v Isaacs 80 181 Lewes Nominees Pty Ltd v Strang 95
152 Hoffman v Cali 80 182 Lewis v Averay 96
153 Holland v Wiltshire 81 183 Life Insurance Co of Australia Ltd v Phillips 96
154 Holmes v Jones 81 184 Lindner v Murdock's Garage 97
155 Hong Kong Fir Shipping Co Ltd v Kawasaki 185 Liverpool City Council v Irwin 97
Kisen Kaisha Ltd 82
186 Louinder v Leis 98
156 Hope v RCA Photophone of Australia Pty Ltd 83
187 Louth v Diprose 98
157 Howe vTeefy 83
188 Lucy v Commonwealth 99
158 Hoyt's Pty Ltd v Spencer 84
189 Lumbers v W Cook Builders Pty Ltd 99
159 Hungerfords v Walker 84
190 Lumley v Wagner 100
160 Hyundai Heavy Industries Co Ltd
191 Luna Park (NSW) Ltd v Tramways
v Papadopoulos 85
Advertising Pty Ltd 100
161 I & L Securities Pty Ltd v HTW Valuers
(Brisbane) Pty Ltd 85 192 McDermott v Black 101
162 Immer (No 145) Pty Ltd v Uniting Church in 193 McDonald v Dennys Lascelles Ltd 101
Australia Property Trust (NSW) 86 194 McKenzie v McDonald 102
163 TC Industrial Plant Pty Ltd v Robert's 195 McRae v Commonwealth Disposalv
Queensland Pty Ltd 86 Commission 102
164 Jackson v Union Marine Insurance Co Ltd 87 196 MaCrobertson Miller Airline Services
v Commissioner of State Taxation
165 Jarvis v Swans Tours Ltd 87
(Western Australia) 103
166 Je Maintiendrai Pty Ltd v Quaglia 88
197 McT ier v Haupt 103
167 Johnson v Agnew 88
198 Maggbury Pty Ltd v Hafele Australia
168 Johnson v Buttress 89
Pty Ltd 104
169 Johnson v Perez 89 199 MaHoney v Lindsay 104
~ Jones v Padavatton 90 200 Manchester Diocesan Council for Education
Joscelyne v Nissen 90 v Commercial & General Investments Ltd 105
172 Kiriri Cotton Co Ltd v Dewani 91
viii ix
Contents
LexisNexis Case Summaries
Case Number Case Name Case Number Case Name
201 Maple Flock Co Ltd v Universal Furniture 228 Pao On v Lau Yiu Long 120
Products (Wembley) Ltd 105 229 Parker v South Eastern Railway Co 121
202 Maralinga Pty Ltd v Major Enterprises Pty Ltd 106 230 H Parsons (Livestock) Ltd v Uttley Ingham
203 Maredelanto Compania Naviera SA &Co Ltd 121
v Bergbau-Handel Gmbh (the Mihalis Angelos) 106 231 Pavey & Matthews Pty Ltd v Paul 122
204 Maritime National Fish Ltd v Ocean 232 Perri v Coolangatta Investments Pty Ltd 122
Trawlers Ltd 107 233 Petelin v Cullen 123
205 Marks v GIO Australia Holdings Ltd 107 234 Peter Turnbull and Co Pty Ltd v Mundus
206 Masters v Cameron 108 Trading Co (Australasia) Pty Ltd 123
207 Maynard v Goode 108 235 Peters Ice Cream (Vic) Ltd v Todd 124
208 Meehan v Jones 109 236 Pharmaceutical Society of Great Britain
209 Mobil Oil Australia Ltd v Wellcome v Boots Cash Chemists (Southern) Ltd 124
International Pty Ltd 109 237 Photo Production Ltd v Securicor
210 The Moorcock 110 Transport Ltd 125
Morris v Baron and Co 110 238 Pirie v Saunders 125
~
2 Murphy v Overton Investments Pty Ltd 111 239 Placer Development Ltd v Commonwealth 126
213 Musumeci v Winadell Pty Ltd 111 240 Popiw v Popiw 126
214 Nash v Inman 112 241 Port Jackson Stevedoring Pty Ltd
v Salmond & Spraggon (Aust) Pty Ltd 127
215 National Carriers Ltd v Panalpina
(Northern) Ltd 112 242 Porter v Latec Finance ( Qld) Pty Ltd 127
216 New Zealand Shipping Co Ltd 243 Price v Strange 128
v A M Satterthwaite & Co Ltd 113 244 Progressive Mailing House Pty Ltd
217 Nordenfelt v Maxim Nordenfelt Guns and v Tabali Pty Ltd 128
Ammunition Co Ltd 113 245 Public Trustee v Taylor 129
218 North v Marra Developments Ltd 114 246 Pukallus v Cameron 129
219 North Ocean Shipping Co Ltd v Hyundai 247 Pym v Campbell 130
Construction Co Ltd 114 248 Radford v De Froberville 130
220 O'Brien v Smolonogov 115 249 Rawson v Hobbs 131
221 Oceanic Sun Line Special Shipping 250 Reardon Smith Line Ltd v Yngvar
Co Inc v Fay 115 Hansen-Tangen 131
222 O'Dea v Allstates Leasing System 251 Redgrave v Hurd 132
(WA) Pty Ltd 116 252 Reg Glass Pty Ltd v Rivers Locking
223 Ogilvie v Ryan 117 Systems Pty Ltd 132
224 Orton v Melman 117 253 Regent v Millett 133
225 Oscar Chess Ltd v Williams 118 254 Renard Constructions (ME) Pty Ltd
226 Pacific Brands Sport & Leisure Pty Ltd v Minister for Public Works 133
v Underworks Pty Ltd 118 255 Rinaldi & Patroni Pty Ltd v Precision
227 Pacific Carriers Ltd v BNP Paribas 119 Mouldings Pty Ltd 134
x xi
LexisNexis Case Summaries Contents
Case Number Case Name Case Number Case Name
256 Ringrow Pty Ltd v BP Australia Pty Ltd 135 282 South Australian Cold Stores Ltd
257 M K & J A Roche Pty Ltd v Metro Edgley v Electricity Trust of South Australia 148
Pty Ltd 135 283 State Rail Authority of New South Wales
258 Roscorla v Thomas 136 v Heath Outdoor Pty Ltd 149
259 Rose and Frank Co v J R Crompton 284 Steele v Tardiani 149
and Bros Ltd 136 285 Stem v McArthur 150
260 Roxborough v Rothmans of Pall Mall 286 Stevenson, Jaques & Co v McLean 150
Australia Ltd 137 287 Stilk v Myrick 151
261 Royal Botanic Gardens and Domain
288 Stuart Pty Ltd v Condor Commercial
Trust v South Sydney City Council 137
Insulation Pty Ltd 151
262 Sabemo Pty Ltd v North Sydney Municipal
289 Sumpter v Hedges 152
Council 138
290 T A Sundell & Sons Pty Ltd
263 St John Shipping Corporation v Joseph
v Emm Yannoulatos (Overseas) Pty Ltd 152
Rank Ltd 139
291 Suttor v Gundowda Pty Ltd 153
264 Sajan Singh v Sardara Ali 139
292 Svanosio v McNamara 153
265 Sargent v ASL Developments Pty Ltd 140
293 Sydney City Council v West 154
266 Saunders v Anglia Building Society 140
294 Sykes v Reserve Bank of Australia 154
267 J J Savage & Sons Pty Ltd v Blakney 141
295 Tanwar Enterprises Pty Ltd v Cauchi 155
268 G Scammell and Nephew Ltd v H C
296 Taylor v Caldwell 1j5__
and J G Ouston 141
269 Secured Income Real Estate (Aust) Ltd 297 Taylor v Johnson 156
v St Martins Investments Pty Ltd 142 298 Thomas Brown and Sons Ltd v Fazal Deen 156
270 Sellars v Adelaide Petroleum Nl 142 299 Thomas National Transport (Melbourne)
271 B Seppelt & Sons Ltd v Commissioner Pty Ltd v May & Baker (Aust) Pty Ltd 157
for Main Roads 143 300 Thornton v Shoe Lane Parking Ltd 157
272 L Shaddock & Associates Pty Ltd 301 Todd v Nicol 158
v Parramatta City Council (No 1) 143 302 Tolhurst v Associated Portland Cement
273 Shepperd v Council of The Municipality Manufacturers (1900) Ltd 158
ofRyde 144 303 Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd 159
274 Shevill v Builders Licensing Board 144 304 Trident General Insurance Co Ltd
275 Simmons Ltd v Hay 145 v McNiece Bros Pty Ltd 159
276 Simonius Vischer & Co v Holt & Thompson 145 305 Tropical Traders Ltd v Goonan 160
277 Sindel v Georgiou 146 306 Universal Cargo Carriers Corporation
278 Smith v Hughes 146 v Citati 160
279 Smith v Land and House Property 307 Universe Tankships Inc of Monrovia
v International Transport Workers Federation 161
Corporation 147
280 Smythe v Thomas 147 308 Upper Hunter County District Council
v Australian Chilling and Freezing Co Ltd 161
281 Solle v Butcher 148
309 Vadasz v Pioneer Concrete (SA) Pty Ltd 162
xii xiii
LexisNexis Case Summaries
Preface
Case Number Case Name
310 Victoria Laundry (Windsor) Ltd
v Newman Industries Ltd 162
311 Vimig Pty Ltd v Contract Tooling Pty Ltd 163
312 Waltons Stores (Interstate) Ltd v Maher 163 This book was first published in 1983, as the introductory book in a
313 Watt v Westhoven 164 series of 'Butterworths' Student Companions'. In my preface, I said:
314 West v AGC (Advances) Ltd 164 The efforts of legal headnoters and precis writers are more often
315 Westmelton (Vic) Pty Ltd v Archer 165 condemned than appreciated, and this fate probably awaits these
316 Westpac Banking Corporation casenotes if they fall into the hands of scholars. However, I hope that
students may find them useful when, daunted by thickets of judicial
v Tanzone Pty Ltd 165
verbiage, they try to discover what the cases they are taught are about.
317 Westralian Farmers Ltd v Commonwealth
Agricultural Service Engineers Ltd (in liq) 166 My hopes were fulfilled, as is demonstrated by the regular appearance
318 White v Australian and New Zealand of further editions. My fears of scholars did not eventuate, probably
because they and their teachers ignored the book. However, its assistance
Theatres Ltd 166
is appreciated by students struggling to digest the official casebooks.
319 White and Carter (Councils) Ltd v McGregor 167
320 Whitlock v Brew 167 A preface was dropped in recent editions, but it is appropriately
321 Whittet v State Bank of New South Wales 168 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
322 Wigan v Edwards 168
as adding many cases, I have fully revised all the case notes to include
323 Wilkinson v Osborne 169 the series' headings of 'Facts', 'Issue' and 'Decision'.
324 Williams v Roffey Bros & Nicholls
(Contractors) Ltd 169 I hope that the book will continue to assist new generations of law
students.
325 J C Williamson Ltd v Lukey and Mulholland 170
326 Woodar Investment Development Ltd Matthew Smith
v Wimpey Construction UK Ltd 170 Sydney,
327 Yango Pastoral Co Pty Ltd v First Chicago March 2011
Australia Ltd 171
328 Yerkey v Jones 171
329 Young v Queensland Trustees Ltd 172
xiv 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 ISSUE Was cl 28 enforceable as a condition precedent to the
warranties in an agreement was capable of constituting misleading conduct commencement of litigation?
under s 52 without any previous representation or other conduct.
DECISION Clause 28, including the obligations to negotiate and to
mediate in good faith, was sufficiently certain to be enforceable. However,
[3] ADMINISTRATION OFTHETERRITORY OF PAPUA the mediation clause was unenforceable, due to its uncertainty as to
AND NEW GUINEA v LEAHY apportionment of the mediator's costs, and the agreement to negotiate
was inseverable and also unenforceable. A stay was therefore refused.
(1961) 105 CLR 6
High Court of Australia
[5] ALATI v KRUGER
Intention to enter contractual relations
(1955) 94 CLR 216
FACTS The Administration agreed to carry out a tick-eradication High Court of Australia
program on Leahy's property at his request. Through deficiencies of
character and over-indulgence in alcohol, the Administration's officers Rescission for fraud - Restitutio in integrum
neglected their work, and Leahy's cattle became more seriously affected
FACTS Alati ~uced Kru~r to purchase a fruit shop busines~ by
with Redwater Fever than they had been before. He sued for damages.
representing_iliat its average takings were £100 er week. Within two
ISSUE Was there a contract? weeks of taking possessio~ Krugerj~~md th~ the representation was
false, and he commenced proceedings for rescission. He continued to
DECISION Leahy failed. The arrangements were not contractual, since carry on the business for several months, but closed it down an<! left the
the Administration did no more than give effect to a general policy of premises before judgment was given.
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 ISSUE Was the remedy still available in equity?
Leahy's attitude throughout was that of a private person appealing for
DECISION Kruger, as a defrauded purchaser, was entitled to rescind
government assistance.
the purchase and to obtain a decree declaring and giving effect to the
rescission as an avoidance of the transaction from the beginniQ& The
[4] AITON AUSTRALIA PTY LTD vTRANSFIELD PTY LTD remedy was discretionary, but, in the circumstances, it was impossible
to convict Kruger of any unfairness in discontinuing the business, and
(1999) 153 FLR 236
he had not lost his right to a decree.
Supreme Court of New South Wales
Uncertainty of condition - good faith negotiations - mediation
[6] ALDERSLADE v HENDON LAUNDRY LTD
agreement
[1945] KB 189
FACTS Aiton contracted with Transfield to construct part of the Court of Appeal, Civil Division (England and Wales)
Osborne Co-Generation project in South Australia. It commenced
Interpretation of limitation condition - Negligent bailee
proceedings for damages under the Trade Practices Act 1974 (Cth),
after its claims for payment were disputed by Transfield. Transfield
FACTS Alderslade left 10 large Irish linen handkerchiefs to be washed
applied for a stay of proceedings on the ground that dispute resolution
by Hendon Laundry, but they were lost and not returned. When sued
procedures under the contract had not been followed by Aiton.
for £5, Hendon tendered 1 ls 5~d and relied on a condition that 'the
Clause 28.1 of the contract provided that the parties 'shall make
maximum amount allowed for lost or damaged articles is twenty times
diligent and good faith efforts to resolve all disputes in accordance
the charge made for laundering'. Alders lade argued that the condition
with the provisions of this Section 28. l before either party commences
did not apply because it did not expressly limit liability in respect of
legal action'. The clause set out a dispute notice and negotiations
negligence.
procedure, and provided that unresolved disputes would be submitted
to mediation. ISSUE Did the limitation condition cover negligence?
2 3