Sita Pty Ltd V Lorimer Pty Ltd [2009] NSWLC 14

Local Court of New South Wales

CITATION: Sita Pty Ltd V Lorimer Pty Ltd [2009] NSWLC 14

JURISDICTION: Civil

PARTIES: SITA Pty Ltd Lorimer Pty Ltd

FILE NUMBER: 2730/09

PLACE OF HEARING: Downing Centre

DATE OF DECISION: 10/22/2009

MAGISTRATE: Magistrate Heilpern

CATCHWORDS: CONTRACT LAW – Penalty Clauses – Ambiguity of Terms

LEGISLATION CITED:

Multiplex Constructions v Abgarus Pty Ltd 33 NSWLR 204 CASES CITED: Ringrow Pty Ltv v BP Australia Pty Ltd [2005] HCA 71 Australian Broadcasting Commission v Australasian Performing Right Association Ltd [1973] HCA 36 King v CGU-VACC [2008] NSWSC 306

TEXTS CITED:

REPRESENTATION: Mr Raine of Counsel for the Plaintiff Mr Black of Counsel for the Defendant.

ORDERS:

IN THE LOCAL COURT OF NEW SOUTH WALES

Reasons for Decision

1 SITA provides waste disposal bins. Lorimer Timber is a timber business. SITA provided bins for Lorimer under a contract. SITA claims that Lorimer has breached and terminated the contract, and thus must pay the sum sought. Lorimer challenges that claim on two grounds – that the contract is ambiguous, and that the termination clause is a penalty and thus is not enforceable.

2 This judgment is written without the benefit of transcript. Issues

3 There is little in contention factually, and neither party called witnesses at the hearing. The evidence is that there was a signed written contract for a stated period of approximately 11 months, which was a commercial agreement. Fifty-eight days prior to the expiration of the contract, Lorimer gave notice that they would not be renewing the contract. SITA claims that the notice should have been 60 days, or else clause two is triggered. Lorimer denies this claiming ambiguity. Alternatively, Lorimer claims that clauses six and seven are penalty clauses.