Contract Law Casebook

TABLE OF CONTENTS
	Table of Cases
	Table of Statutes
	Preface
	Acknowledgments
	PART 1: OVERVIEW
		CHAPTER 1: INTRODUCTION
			The development of Australian contract law
				Recognition of the writ of assumpsit
					Slade’s Case
				Requirement of consideration
					Rann v Hughes
					Eastwood v Kenyon
				Equitable estoppel
				Potential reform
			Questions for reflection
		CHAPTER 2: NEGOTIATION
			Introduction
			Elements of negotiation
			Bargaining strategies
				‘Don’t Bargain Over Positions’
			Phases of negotiation
				‘The Transaction’
			Questions for reflection
	PART 2: FORMATION
		CHAPTER 3: AGREEMENT
			Introduction
			Offer
				Defining an offer
					Carlill v Carbolic Smoke Ball Company
					Electronic Transactions (Victoria) Act 2000 (Vic), s 14B
				Categorising transactions
					Harvey v Facey
					Smythe v Thomas
				Communication of an offer
				Termination of an offer
					Dickinson v Dodds
			Acceptance
				Offeree must accept terms of offer
					Crown v Clarke
					Hyde v Wrench
					Stephenson, Jaques, & Co v McLean
				Acceptance must be communicated to offeror
					Carlill v Carbolic Smoke Ball Company
					Henthorn v Fraser
					Nunin Holdings Pty Ltd v Tullamarine Estates Pty Ltd
					Electronic Transactions (Victoria) Act 2000 (Vic), s 13A
					Electronic Transactions (Victoria) Act 2000 (Vic), s 14E
			Questions for reflection
		CHAPTER 4: CERTAINTY AND COMPLETENESS
			Introduction
			Ambiguity and uncertainty
				Whitlock v Brew
			Incomplete agreements
				United Group Rail Services Ltd v Rail Corporation of New South Wales
				Godecke v Kirwan
			‘Subject to contract’
				Masters v Cameron
			Questions for reflection
		CHAPTER 5: INTENTION TO CREATE LEGAL RELATIONS
			Introduction
			Modern approach
				Ermogenous v Greek Orthodox Community of SA Inc
			Government activities
			Circumstances indicating absence of intention
			Questions for reflection
		CHAPTER 6: CONSIDERATION
			Introduction
			Rules governing consideration
			Consideration must move from the promisee
				Coulls v Bagot’s Executor and Trustee Company Ltd
			Consideration: specific examples
			Performance of an existing contractual duty
				Stilk v Myrick
				Williams v Roffey Bros & Nicholls (Contractors) Ltd
				Musumeci v Winadell Pty Ltd
			Bargained-for conduct already performed
				Pau On v Lau Yiu Long
			Questions for reflection
		CHAPTER 7: EQUITABLE ESTOPPEL
			Introduction
			Recognition of equitable estoppel
				Waltons Stores (Interstate) Ltd v Maher
			Relevant remedy
				Commonwealth v Verwayen
				Giumelli v Giumelli
			Questions for reflection
	PART 3: CONTENT
		CHAPTER 8: TERMS I: ESTABLISHING CONTRACTUAL TERMS
			Introduction
			Incorporating written terms
			Incorporation by signature
				Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd
			Incorporation by notice—unsigned documents and signs
			Incorporation by notice—website
			Incorporation by reference
			Incorporating oral terms
				Oscar Chess Ltd v Williams
				JJ Savage & Sons Pty Ltd v Blakney
				Crown Melbourne Ltd v Cosmopolitan Hotel (Vic) Pty Ltd
			Implied terms reflecting the intention of the parties
			Term implied on the basis of business efficacy
				Codelfa Construction Pty Ltd v State Rail Authority of New South Wales
				Term implied from a previous consistent course of dealings between the parties
				Term implied from custom or usage
				Term implied to complete agreement
			Terms implied regardless of intention
				Term implying duties of good faith, fair dealing and reasonableness
					Renard Constructions (ME) Pty Ltd v Minister for Public Works
					Vodafone Pacific Ltd v Mobile Innovations Ltd
					Esso Australia Resources Pty Ltd v Southern Pacific Petroleum NL
			Questions for reflection
		CHAPTER 9: TERMS II: CONSTRUCTION OF TERMS
			Introduction
			Interpreting the meaning of terms
				Codelfa Construction Pty Ltd v State Rail Authority of New South Wales
				Franklins Pty Ltd v Metcash Trading Pty Ltd
				Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd
			Legal effect of words: types of terms
				Associated Newspapers Ltd v Bancks
				Hongkong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd
				Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd
				Darlington Futures Ltd v Delco Australia Ltd
				Council of The City of Sydney v West
			Questions for reflection
	PART 4: LIMITS ON ENFORCEMENT OF CONTRACTS
		CHAPTER 10: CAPACITY
			Introduction
			Minors
				Common law
					Nash v Inman
				Contracts of employment and apprenticeship
					De Francesco v Barnum
				Contracts that are binding unless repudiated
					Steinberg v Scala (Leeds) Ltd
				Legislation
					Supreme Court Act 1986 (Vic), s 49
					Supreme Court Act 1986 (Vic), s 50
					Supreme Court Act 1986 (Vic), s 51
					Minors Contracts (Miscellaneous Provisions) Act 1979 (SA), s 4
					Minors Contracts (Miscellaneous Provisions) Act 1979 (SA), s 5
					Minors Contracts (Miscellaneous Provisions) Act 1979 (SA), s 6
					Minors Contracts (Miscellaneous Provisions) Act 1979 (SA), s 7
					Minors Contracts (Miscellaneous Provisions) Act 1979 (SA), s 8
					Minors (Property and Contracts) Act 1970 (NSW), s 19
					Minors (Property and Contracts) Act 1970 (NSW), s 20
					Minors (Property and Contracts) Act 1970 (NSW), s 23
					Minors (Property and Contracts) Act 1970 (NSW), s 24
					Minors (Property and Contracts) Act 1970 (NSW), s 26
					Minors (Property and Contracts) Act 1970 (NSW), s 27
					Minors (Property and Contracts) Act 1970 (NSW), s 28
					Minors (Property and Contracts) Act 1970 (NSW), s 29
					Minors (Property and Contracts) Act 1970 (NSW), s 30
					Minors (Property and Contracts) Act 1970 (NSW), s 31
					Minors (Property and Contracts) Act 1970 (NSW), s 33
					Minors (Property and Contracts) Act 1970 (NSW), s 34
					Minors (Property and Contracts) Act 1970 (NSW), s 36
					Minors (Property and Contracts) Act 1970 (NSW), s 37
			Mental incapacity
				Gibbons v Wright
				Queensland
					Guardianship and Administration Act 2000 (Qld), s 12
				Other Australian jurisdictions
			Governments and the Crown
				New South Wales v Bardolph
			Questions for reflection
		CHAPTER 11: FORMALITIES
			Introduction
			Nature of a guarantee
				Yeoman Credit Ltd v Latter
				Harvey v Edwards, Dunlop & Co Ltd
				Statutory requirement of writing—guarantees
			Property Law Act 1974 (Qld), s 56
			Nature of land contract needing writing
				Powercell Pty Ltd v Cuzeno Pty Ltd
				Statutory requirement of writing—land contracts
					Property Law Act 1974 (Qld), s 59
			Content of writing—general
				Pirie v Saunders
				Acknowledgement of agreement
				Signed by party to be charged or agent
					Durrell v Evans
			Joinder of documents
				Harvey v Edwards, Dunlop & Co Ltd
				Fauzi Elias v George Sahely and Co (Barbados) Ltd
				Todrell Pty Ltd v Finch
			Adequacy of electronic ‘writing’ and ‘signature’
				Writing
					Electronic Transactions (Victoria) Act 2000 (Vic), s 8
					Instruments Act 1958 (Vic), s 129
				Signature
					Electronic Transactions (Victoria) Act 2000 (Vic), s 9
			Effect of statutory non-compliance: common law
			Effect of statutory non-compliance: equity
				Doctrine of part-performance
					Regent v Millett
				Estoppel
					Powercell Pty Ltd v Cuzeno Pty Ltd
			Variation and termination of contract
				Electronic Industries Ltd v David Jones Ltd
			Questions for reflection
		CHAPTER 12: PRIVITY
			Introduction
			Statutory abrogation of privity
				Western Australia
			Property Law Act 1969 (WA), s 11
				Queensland and Northern Territory
			Property Law Act 1974 (Qld), s 55
			So-called ‘exceptions’
				Trident General Insurance Co Ltd v McNiece Bros Proprietary Ltd
				New Zealand Shipping Co Ltd v AM Satterthwaite & Co Ltd (The Eurymedon)
			Questions for reflection
	PART 5: VITIATING FACTORS
		CHAPTER 13: MISREPRESENTATION AND MISLEADING OR DECEPTIVE CONDUCT
			Introduction
			Elements of misrepresentation
				False statement of past or present fact
					Edgington v Fitzmaurice
					Bisset v Wilkinson
					Dimmock v Hallett
			Reliance
				Gould v Vaggelas
			Types of misrepresentation
				Innocent misrepresentation
				Fraudulent misrepresentation
					Derry v Peek
				Negligent misrepresentation
					Shaddock & Associates v Parramatta City Council
			Rescission
				Alati v Kruger
			Misleading or deceptive conduct
				Overview
				Elements
					Concrete Constructions (NSW) Pty Ltd v Nelson
					Campomar Sociedad Limitada v Nike International Ltd
					Downey v Carlson Hotels Asia Pacific Pty Ltd
				The appropriate level of analysis
					Miller and Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd
			Australian Consumer Law, s 4
				Bennett v Elysium Noosa Pty Ltd (in liq)
			Remedies for a contravention of s 18
			Damages
				Henville v Walker
				Reduction of damages for failure to take reasonable care
			Competition and Consumer Act 2010 (Cth), s 137B
				Apportionment of loss between wrongdoers
			Competition and Consumer Act 2010 (Cth), ss 87CB-87CC
			Rescission
				Tenji v Henneberry & Associates Pty Ltd
				Exclusion of misleading conduct
					Downey v Carlson Hotels Asia Pacific Pty Ltd
					Butcher v Lachlan Elder Realty Pty Ltd
			Questions for reflection
		CHAPTER 14: MISTAKE
			Introduction
			Common mistake
				McRae v Commonwealth Disposals Commission
				Solle v Butcher
				Great Peace Shipping Ltd v Tsavliris Salvage (International) Ltd (The Great Peace)
			Mutual mistake
			Unilateral mistake
				Taylor v Johnson
			Mistaken identity
				Lewis v Averay
				Mistake as to the nature of the contract (‘non est factum’)
					Petelin v Cullen
			Questions for reflection
		CHAPTER 15: DURESS
			Introduction
			Types of duress
				Barton v Armstrong
				Australia and New Zealand Banking Group Ltd v Karam
				North Ocean Shipping Co Ltd v Hyundai Construction Co Ltd (The Atlantic Baron)
			Statute
			Questions for reflection
		CHAPTER 16: UNDUE INFLUENCE
			Introduction
			Classes of undue influence
				Khan v Khan
				Johnson v Buttress
			Undue influence and third party sureties
				Garcia v National Australia Bank
			Questions for reflection
		CHAPTER 17: UNCONSCIONABLE CONDUCT
			Introduction
			Unconscionable conduct in equity
				Commercial Bank of Australia v Amadio
				Louth v Diprose
				Australian Competition and Consumer Commission v CG Berbatis Holdings Pty Ltd
				Kakavas v Crown Melbourne Ltd
			Statute
				Australian Consumer Law
			Australian Consumer Law, s 20
			Australian Consumer Law, s 21
			Australian Consumer Law, s 22
				Contracts Review Act 1980 (NSW)
				Contracts Review Act 1980 (NSW), s 7
				Contracts Review Act 1980 (NSW), s 9
				West v AGC (Advances) Ltd
			Questions for reflection
		CHAPTER 18: VOID AND ILLEGAL CONTRACTS
			Introduction
			Void contracts
				Nordenfelt v Maxim-Nordenfelt Guns and Ammunition Co Ltd
			Illegal contracts
				Illegality by statute
					Yango Pastoral Co Pty Ltd v First Chicago Australia Ltd
					Equuscorp Pty Ltd v Haxton
				Illegality at common law
					Wilkinson v Osborne
				Effects of illegality
					Fitzgerald v FJ Leonhardt Pty Ltd
			Severance
				Common law
					Attwood v Lamont
					Goodinson v Goodinson
				Statute
			Restraints of Trade Act 1976 (NSW), s 4
			Competition and Consumer Act 2010 (Cth), s 4L
			Questions for reflection
	PART 6: DISCHARGE OF THE CONTRACT
		CHAPTER 19: DISCHARGE BY PERFORMANCE
			Introduction
			Types of obligations
				Independent obligations
				Dependent obligations
					Automatic Fire Sprinklers Pty Ltd v Watson
				Dependent and concurrent obligations
			Recovering the contract price
			Divisible contract
				Steele v Tardiani
			Entire obligations
				Cutter v Powell
			Obligations requiring substantial performance
				Hoenig v Isaacs
			Establishing substantial performance
				Bolton v Mahadeva
				ACN 002 804 702 (Formerly Brooks Building) v McDonald
			Partial performance and breach
				Connor v Stainton
				Quantum meruit as alternative to contract price
			Questions for reflection
		CHAPTER 20: DISCHARGE BY TERMINATION
			Introduction
			Common law right of termination
			Breach of essential term or intermediate term
			Repudiation
				Anticipatory breach
					Foran v Wight
				Examples of repudiation
					Laurinda Pty Ltd v Capalaba Park Shopping Centre Pty Ltd
					DTR Nominees Pty Ltd v Mona Homes Pty Ltd
					Almond Investors Ltd v Kualitree Nursery Pty Ltd
			Termination for delay
				Laurinda Pty Ltd v Capalaba Park Shopping Centre Pty Ltd
			When is time essential?
				Termination where time not essential
			When to give a notice to complete
				Louinder v Leis
				Laurinda Pty Ltd v Capalaba Park Shopping Centre Pty Ltd
			Election to terminate
				Sargent v ASL Developments Ltd
				Restrictions on termination
				Ready willing and able
					Foran v Wight
				Terminating party not in breach of contract
					Almond Investors Ltd v Kualitree Nursery Pty Ltd
			Contractual and statutory restrictions
			Effect of discharge of contract
				McDonald v Dennys Lascelles Ltd
			Questions for reflection
		CHAPTER 21: DISCHARGE BY AGREEMENT
			Introduction
				Variation distinguished from discharge
					Morris v Baron & Co
			Requirements of writing
				Discharge
				Variation
			Novation
				ALH Group Property Holdings Pty Ltd v Chief Commissioner of State Revenue
			Abandonment
				Fitzgerald v Masters
			Questions for reflection
		CHAPTER 22: DISCHARGE BY FRUSTRATION
			Introduction
			Test for frustration
				Codelfa Construction Pty Ltd v State Rail Authority of New South Wales
				Ocean Tramp Tankers Corporation v V/O Sovfracht (The Eugenia)
				National Carriers Ltd v Panalpina (Northern) Ltd
			Limits on frustration
			Express contractual provision
				Claude Neon Ltd v Hardie
			Supervening event foreseeable
				oOH! Media Roadside Pty Ltd v Diamond Wheels Pty Ltd
			Supervening event self-induced
				Maritime National Fish Ltd v Ocean Trawlers Ltd
			Effect of frustration
				Common law
					Fibrosa Spolka Akcyjna v Fairbairn Lawson Combe Barbour Ltd
				Statute
					Frustrated Contracts Act 1978 (NSW), s 7
					Frustrated Contracts Act 1978 (NSW), s 8
					Frustrated Contracts Act 1978 (NSW), s 10
					Frustrated Contracts Act 1978 (NSW), s 11
					Frustrated Contracts Act 1978 (NSW), s 12
					Frustrated Contracts Act 1978 (NSW), s 13
					Frustrated Contracts Act 1978 (NSW), s 15
					Frustrated Contracts Act 1959 (Vic), s 3
					Frustrated Contracts Act 1988 (SA), s 6
					Frustrated Contracts Act 1988 (SA), s 7
			Questions for reflection
	PART 7: REMEDIES
		CHAPTER 23: DAMAGES
			Introduction
				Commonwealth v Amann Aviation Pty Ltd
			Limits on recovery of damages
				Causation
					Alexander v Cambridge Credit Corp Ltd
			Remoteness
				First limb of Hadley v Baxendale
				Second limb of Hadley v Baxendale
				Victoria Laundry (Windor) Ltd v Newman Industries Ltd
			Mitigation
				Payzu Ltd v Saunders
			Assessment of loss and heads of damage
				Loss of opportunity
					Commonwealth v Amann Aviation Pty Ltd
				Rectification of defective work
					Tabcorp Holdings Ltd v Bowen Investments Pty Ltd
				Mental distress
					Baltic Shipping v Dillon
			Restrictions on recovery of damages
				Termination
				Ready willing and able to perform
					Foran v Wight
			Liquidated damages and penalties
				Application of the doctrine of penalties
					Andrews v Australia and New Zealand Banking Group Ltd
				Penalty or genuine pre-estimate
					Paciocco v Australia and New Zealand Banking Group Ltd
				Effect of clause being a penalty
			Questions for reflection
		CHAPTER 24: RESTITUTION
			Introduction
				Pavey & Matthews Pty Ltd v Paul
			Restitution between contracting parties
				Termination of contract
				Alternative claims
			Unjust enrichment
			Recovery of money paid
			Failure of consideration
				Baltic Shipping v Dillon
			Money paid under a mistake
				David Securities Pty Ltd v Commonwealth Bank of Australia
			Illegality
				Equuscorp Pty Ltd v Haxton
				Claims for services rendered
			Services as a benefit
			Claim where contract governs payment
				Lumbers v W Cook Builders Pty Ltd (in liq)
			Ineffective contracts
				Pavey & Matthews Pty Ltd v Paul
				Partially performed contracts
					Steele v Tardiani
				Defence—change of position
					Australian Financial Services and Leasing Pty Ltd v Hills Industries Ltd
			Questions for reflection
		CHAPTER 25: EQUITABLE REMEDIES
			Introduction
			Specific performance
				JC Williamson Ltd v Lukey and Mulholland
			Defences to specific performance
				Where the contract was entered as a result of mistake or misrepresentation
				Where enforcement would create undue hardship upon the defendant
					Fairborne Pty Ltd v Strata Store Noosa Pty Ltd
				Where the plaintiff is in breach of contract or not ready, willing, and able to perform his or her obligations under the contract
				Performance of the contract is not possible or would be futile
				Where the plaintiff is guilty of laches
				That the contract is unenforceable because of informality
			Injunction
				JC Williamson Ltd v Lukey and Mulholland
			Questions for reflection
	PART 8: CONSUMER PROTECTION
		CHAPTER 26: UNFAIR CONTRACT TERMS
			Introduction
			Contracts to which unfair terms applies
				Consumer contract
			Small business contract
				Nature of goods and services
				Less than twenty employees
				Meaning of ‘business’
				Limit on upfront price of contract
				Standard form contract
			Australian Consumer Law, s 27
				Application to contracts after commencement
				Exempt contracts
				Identifying unfair terms
				Excluded terms
					Office of Fair Trading v Ashbourne Management Services Ltd
					Unfair Contract Terms Law: A Guide for Businesses and Legal Practitioners
					Australian Consumer Law, s 26(2)
					Office of Fair Trading v Foxtons Ltd
			Test for an ‘unfair term’
				Approach to assessment—whole of contract and transparency
					Australian Consumer Law, s 24(2), (3)
					Director of Consumer Affairs (Vic) v AAPT
					Australian Consumer Law, s 25
					Director of Consumer Affairs Victoria v Backloads.com Pty Ltd
			Remedies and enforcement
				Declaration
				Compensation
				Injunction
			Questions for reflection
		CHAPTER 27: CONSUMER GUARANTEES
			Introduction
			Consumer guarantees relating to the supply of goods
			Supply
				Goods
				Consumers
				Trade or commerce
				Goods that are not covered
				Guarantee as to title—s 51
					Australian Consumer Law, s 51(1)
				Guarantee as to undisturbed possession—s 52
				Guarantee as to undisclosed securities—s 53
					Australian Consumer Law, s 53(1)
				Guarantee as to acceptable quality—s 54
					Australian Consumer Law, s 54(1)
					Australian Consumer Law, s 54(2)
				Guarantee as to fitness for any disclosed purpose—s 55
					Australian Consumer Law, s 55(2)
				Guarantee relating to supply of goods by description—s 56
				Guarantee relating to supply of goods by way of sample or demonstration model—s 57
					Australian Consumer Law, s 57(1)
				Guarantee as to repairs and spare parts—s 58
				Guarantee as to express warranties—s 59
					Australian Consumer Law, s 2
					Australian Consumer Law, s 102(3)
			Competition and Consumer Regulations 2010 (Cth), r 90
				Consumer guarantees relating to the supply of services
				Guarantee as to due care and skill—s 60
				Guarantee as to reasonable time for supply—s 62
			Remedies in relation to goods
				A major failure
					Australian Consumer Law, s 260
				Remedies against suppliers for major failures
				Remedies against suppliers for minor failures
				Recovery of damages from the supplier for consequential loss
				Remedies against manufacturers of goods
					Australian Consumer Law, s 271(2)
					Australian Consumer Law, s 271(4)
				Manufacturers’ liability to indemnify suppliers of goods
				Remedies in relation to services
				A major failure
					Australian Consumer Law, s 268
				Remedies for minor failures
				Damages for consequential loss
				Contracting out of consumer guarantees
				Terms that may be void
				Limiting liability
					Australian Consumer Law, s 64A
					Australian Consumer Law, s 64A(4)
				Recreational service providers
				Proof of transaction
			Questions for reflection
	Index