123 259 932 Pty Ltd v Cessnock City Council [2023] NSWCA 21

Court of Appeal Supreme Court New South Wales Medium Neutral Citation: 123 259 932 Pty Ltd v Cessnock City Council [2023] NSWCA 21 Hearing dates: 25 August 2022 Date of orders: 20 February 2023 Decision date: 20 February 2023 Before: Macfarlan JA at [1]; Brereton JA at [2]; Mitchelmore JA at [171]. Decision: Parties directed to bring in short minutes, including calculation of interest, providing for: (a) The appeal to be allowed; (b) The judgment below to be set aside; (c) In lieu thereof, judgment for appellant/plaintiff for $3,697,234.41 and interest; (d) The Respondent to pay the appellant's costs of the proceedings at first instance and on appeal. Catchwords: CONTRACTS – Remedies – Damages – Reliance Damages – Presumption referred to in McRae v Commonwealth Disposals Commission and The Commonwealth v Amann Aviation – Whether primary judge erred in finding that the presumption did not arise – Presumption arises where expenditure is incurred by a plaintiff in reliance on a contractual promise made by the defendant and "wasted" because of non-performance by the defendant – No precondition that the plaintiff first establish it is "impossible" to prove expectation damages – Plaintiff proved conditions for presumption – Ground of Appeal upheld. CONTRACTS – Remedies – Damages – Reliance Damages – Presumption referred to in McRae v Commonwealth Disposals Commission and The Commonwealth v Amann Aviation – Whether primary judge erred in finding presumption rebutted – Presumption rebutted where defendant demonstrates plaintiff would not have recouped expenditure – Contractual and non-contractual potential benefits of plaintiff to be considered in expenditure inquiry – Plaintiff rejected inferior offer of defendant – Innocent party to a contract entitled to insist on contractual rights rather than accept inferior proposal – Rejection of offer could not form reasonable basis for inference defendant would not have recouped expenditure – Presumption not rebutted – Ground of appeal upheld. CONTRACTS – Remedies – Damages – Remoteness of damage – Whether primary judge erred in finding recovery was precluded by the rule in Hadley v Baxendale – Loss incurred by plaintiff reasonably can be supposed to have been in the contemplation of both parties when contract was made – Damages fall within the second limb of Hadley v Baxendale – Ground of appeal upheld. Legislation Cited: Corporations Act 2001 (Cth), s 601AD(2) Environmental Planning and Assessment Act 1979 (NSW), s 72 Cases Cited: Anglia Television Ltd v Reed [1972] 1 QB 60 Berry v CCL Secure Pty Ltd (2020) 271 CLR 151; [2020] HCA 27 Commonwealth v Amann Aviation Pty Ltd (1991) 174 CLR 64; [1991] HCA 54 Cory & Son v Wingate Investments (1981) 17 BLR 104 Foaminol Laboratories Ltd. v. British Ortid Plastics Ltd [1941] 2 All ER 393 Hadley v Baxendale (1854) 9 Exch 341; 156 ER 145 Johnson v Perez (1988) 166 CLR 351; [1988] HCA 64 McRae v Commonwealth Disposals Commission (1951) 84 CLR 377; [1951] HCA 79 McIntosh v Williams [1979] 2 NSWLR 543 Meetfresh Franchising Pty Ltd v Ivanman Pty Ltd [2020] NSWCA 234 Nikolaou v Papasavas, Phillips & Co (1989) 166 CLR 394; [1989] HCA 11 Renown Corporation Pty Ltd v SEMF Pty Ltd [2022] NSWCA 233 Robinson v Harman (1848) 1 Exch 850; 154 ER 363 Scott v Ennis-Oakes [2020] NSWCA 239 Tabcorp Holdings Ltd v Bowen Investments Pty Ltd (2009) 236 CLR 272; [2009] HCA 8 Wenham v Ella (1972) 127 CLR 454; [1972] HCA 43 Williamson v John I. Thornycroft And Company, Limited [1940] 2 KB 658 Willis v Commonwealth (1946) 73 CLR 105; [1946] HCA 22 Texts Cited: Fuller, LL and Perdue WR, "The Reliance Interest in Contract Damages", (1936) 46 Yale Law Journal 52 Category: Principal judgment Parties: 123 259 932 Pty Limited, ACN 123259932 (Appellant) Cessnock City Council (Respondent) Representation: Counsel: D L Williams SC w B D Kaplan (Appellant) D L Cook SC w G Ng (Respondent) Solicitors: Dentons Australia Pty Ltd (Appellant) Holding Redlich (Respondent) File Number(s): 2021/320994 Publication restriction: N/A Decision under appeal Court or tribunal: Supreme Court Jurisdiction: Common Law Division Citation: [2021] NSWSC 1329 Date of Decision: 18 October 2021 Before: Adamson J File Number(s): 2017/295180