MR Hornibrook (Pty) Ltd v Eric Newham (Wallerawang) Pty Ltd

High Court of Australia Menzies, Windeyer and Walsh JJ. MR Hornibrook (Pty) Ltd v Eric Newham (Wallerawang) Pty Ltd

ORDER Appeal allowed with costs. Cross-appeal dismissed with costs. Agreement between the appellant and the respondent dated 23rd January, 1963 rectified by including therein, as cl. 3A, the following clause: The total amount of this contract, calculated in accordance with the schedule of rates hereto, shall be adjusted by the same percentage as the total amount of the head contract, calculated in accordance with the schedule of rates thereto, is adjusted in accordance with cl. 4 thereof. Judgment of the Supreme Court of Queensland set aside and in lieu thereof judgment for the plaintiff for $46,190 with costs.

Judgment reserved.

THE COURT dealt with matters not here reported and continued:

Sept. 2. Menzies, Windeyer and Walsh JJ.

It remains to consider whether there was any obstacle in law to the rectification of the agreement to make it accord with what the parties intended but had failed to express through mistake. The mistake which was made was obviously mutual because, as we have said, the defendant made to the plaintiff progress payments as though the sub-contract contained the clause necessary to give effect to the agreement of the parties. We agree, therefore, entirely with the learned trial judge that a clause was omitted from the agreement by mutual mistake. Furthermore, we feel satisfied that the clause omitted was one to carry on to the plaintiff any adjustment made in payments to the defendant by virtue of cl. 4 of the head contract in respect of work done by the plaintiff under the sub-contract. This, subject to one reservation, is enough, not only to warrant, but to require an order for rectification along the lines which we have indicated. Rectification in this form would deprive of any significance a point taken by the respondent to oppose rectification, i.e. that the contract and the sub-contract did not cover precisely the same period.