Stuart Pty Limited v Condor Commercial Insulation Pty Limited [2006] NSWCA 334

Reported Decision : (2006) Aust Contract Reports 90-245

New South Wales Court of Appeal

CITATION: Stuart Pty Limited v Condor Commercial Insulation Pty Limited [2006] NSWCA 334

HEARING DATE(S): 19 & 20 June 2006

JUDGMENT DATE: 28 November 2006

JUDGMENT OF: Beazley JA at 1; Ipp JA at 107; Tobias JA at 124

DECISION: 1. Appeal dismissed; 2. Direct that the parties are to provide written submissions in respect of costs within seven days of the date of judgment.

CATCHWORDS: CONTRACTS – appellant sub-contracted insulation work to respondent – breach of sub-contract by respondent – head contract terminated as a result – whether respondent liable for appellant's loss of profits on head contract - REMOTENESS – second limb of Hadley v Baxendale – whether loss within reasonable contemplation of parties – whether respondent knew of special circumstances such that it would be within reasonable contemplation that breach of contract would cause loss – head contract as special circumstance - REMOTENESS – second limb of Hadley v Baxendale – whether event giving rise to loss (a fire due to faulty workmanship) was not unlikely to occur REMOTENESS – knowledge of special circumstances – whether appellant responsible for supervising works – contract price out of all proportion with risk of being liable for enhanced damages

Alexander v Cambridge Credit Corporation Limited (1987) 9 NSWLR 310 Baltic Shipping Co v Dillon (1993) 176 CLR 344 Burns v M.A.N. Automotive (Aust) Pty Limited (1986) 161 CLR 653 C Czarnikow Ltd v Koufos [1969] 1 AC 350 Carter and Harland, Contract Law in Australia (2002, 4th ed) Castle Constructions Pty Limited v Fekala Pty Limited [2006] NSWCA 133 Florida Hotels Pty Limited v Mayo (1965) 113 CLR 591 Greig and Davis, The Law of Contract (1987) CASES CITED: Hadley v Baxendale (1854) 9 Ex 341 Monarch Steamship Co Limited v Karlshamns Oljefabriker (A/B) [1949] AC 196 Oxley County Council v Macdonald & Ors; Brambles Holdings Ltd v Macdonald & Ors [1999] NSWCA 126 R & H Hall Ltd v WH Pim (Junior) & Co Ltd (1928) 33 Com Cas 324; [1928] All ER 763 Robophone Facilities Ltd v Blank [1966] 1 WLR 1428 Seven Seas Properties Ltd v Al-Essa (No 2) [1993] 1 WLR 1083 Simonius Vischer v Holt & Thompson [1979] 2 NSWLR 322 The Commonwealth v Amann Aviation Pty Limited (1991) 174 CLR 64 Victoria Laundry (Windsor) Ltd v Newman Industries Ltd [1949] 2 KB 528 Wenham v Ella (1972) 127 CLR 454