SMITH BROS TRADE AND TRANSPORT TERMINAL PTY LTD v PACIFIC POWER [1998] NSWCA 212

SMITH BROS TRADE & TRANSPORT TERMINAL PTY LTD v PACIFIC POWER

SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

MASON P, MEAGHER JA and FITZGERALD AJA 21 July 1998, 31 July 1998 [1998] NSWCA 212

Licence for occupation of land — occupied land partially flooded — whether implied term that land would be suitable for use — frustration — unconscionability

Mason P The appellant's business was described as that of providing an "outdoor warehouse" (AB 33) for storing large quantities of imported timber belonging to its clients. For many years it operated from premises at Glebe leased from the Maritime Services Board (MSB).

By mid 1988 the MSB was pressing the appellant to leave the Glebe site. The MSB had offered alternative premises at Port Botany, but these were not yet available. It appears that the MSB used its good offices with the respondent to enable the appellant to negotiate an arrangement for temporary occupation of a site at Bunnerong belonging to the respondent. It had been formerly used as a power station.

Oral discussion led to a written licence agreement evidenced by a letter from the respondent to the appellant dated 17 June 1988 upon which a representative of the appellant, Mr Tzaneros, indicated his assent in writing. So far as relevant the letter said:

"BUNNERONG POWER STATION TEMPORARY TIMBER STORAGE

I refer to recent telephone conversations between Commission officers and Messrs Smith and Tzameros [sic] concerning the temporary occupation of part of Bunnerong Power Station site for timber storage.

Tam pleased to advise that the Electricity Commission [the former name of the appellant] would be prepared to enter into an occupation agreement with Smith Brothers Cranes & Cartage Pty Ltd [the former name of the respondent], (herein after called 'the Company') for an area of about | ha of land fronting Bunborah Point Road as shown on the enclosed plan.