Breach of Contract Case Analysis
Added on 2020-03-28
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Running head: CONTRACT LAWContract LawName of the StudentName of the UniversityAuthor Note
1CONTRACT LAWIn the Moot Court of Queensland Case No. SGQW6/2017Between:Apex Engineering Pty Ltd(Plaintiff)-v-Redlands City Council(Defendant)Summary of the Facts 1.The plaintiff and the defendant entered into a contract to construct five multi-purposerecreation and sports facilities in Ipswich, Brisbane and Beaudeser, Toowoomba andLogan City. 2.Although the plaintiff commenced manufacturing and designing but did not start theconstruction as was required by the contract and the defendant terminated the contract.3.Plaintiff claims reliance damages for the works done under the contract as the terminationnotice was an invalid exercise. Defendant’s Submissions1.Wrongful Termination1.1The defendant had entered into a contract with the Plaintiff in July 2016 and thesubject matter of the contact was to construct a five multi-purpose recreation andsports facilities in Ipswich, Brisbane and Beaudeser, Toowoomba and Logan City. 1.2The plaintiff failed to commence with the construction of the sports and therecreational facilities and merely initiated with the manufacturing and designing ofthe project.1.3The defendant terminated the contact based on the ground that the plaintiff hadrepudiated when he failed to commence construction, which forms the subject matterof the contract. In Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd[2007] 233 CLR 115, 135 party to a contract is said to have repudiated the contractwhen their conduct is such that any prudent person would believe that the party thedoes not have any intentions to be bound by the contract. Such conduct shall alsoimply that the plaintiff intends to fulfill the contract in a manner that is contrary tothe obligations conferred on such party1. 1.4The plaintiff had initiated the design and manufacturing of the multi-purpose sportsand recreational facilities but did not commence with the construction of therecreational and sports facility, which signifies that the plaintiff did not have anyintention to perform the contract2. Hence, the defendant had terminated the contracton the ground of breach of the contract which in order to be considered asrepudiation must be sufficiently severe to give rise to the right to terminate. The1 [2007] 233 CLR 115, 1352 Stewart, Andrew. Stewart's guide to employment law. Vol. 3. Sydney: Federation Press, 2013.
2CONTRACT LAWplaintiff committed a breach of contract by failing to commence construction of themulti-purpose sports and recreational facilities. 1.5In law of contract if either party to the contract commits a breach of the contractualterms, the innocent party is entitled to terminate the contract. This is particular whenthe contractual term infringed by the breaching party has been agreed to be anessential term (i.e. a condition) between the parties to the contract as was ruled in theKoompahtoo’s case. If the breached term is a condition, the aggrieved party shall beentitled to terminate the contract with respect to the breach of such contractual term. 1.6In order to determine whether the term breached was essential (i.e. condition) the testof essentiality must be applied. Thos would enable to comprehend whether the natureof the contract signifies that the promise made to the promise was so essential that inthe absence of such promise, he would not have formed the contract if he had notbeen assured of the performance of the promise. If the contractual term breached bythe plaintiff was a warranty or a non-essential term, the innocent party shall beentitled to claim damages but cannot end the contract. If the violated term is anintermediate or an innominate term, the contract is entitled to be terminated3.However, the termination depends on the seriousness of the breach of suchcontractual term.1.7A contract can be terminated for breach of any non-essential or an intermediatecontractual term. In Hongkong Fir Shipping Co Ltd v Kawasaki Kisen Kisha Ltd[1962] 2 QB 264, it was held that for claiming a breach of any contractual term, theinnocent party must establish that the breach was of serious nature and theseriousness of the breach shall enable the innocent party to end the contract. Theaggrieved party must establish that such breach has deprived him of the significantbenefits that he was otherwise entitled to receive had the contract been performed. InAnkar v national Westminster Finance, it was held that in some cases the it becomesdifficult to determine whether the term breached is intermediate term or not owing tothe ambiguousness of the language of the term. Under such circumstances, suchterms shall be considered as both an essential and non-essential term. The seriousnessof the breach shall determine whether the termination of the contract was justified. 1.8The subject matter of the contract entered into between the defendant and theplaintiff as to construct multi-purpose sports and recreational facilities but theplaintiff failed to commence with the construction, which implies his intention of notperforming his contractual obligation. Due to such failure on part of the plaintiff, thedefendant had been deprived of the benefits he would have obtained otherwise, if theplaintiff had fulfilled his contractual obligations. As mentioned in the Hongkong’scase, the defendant is entitled to repudiate the contract on the ground of breach of thecontract on part of the plaintiff.2.Wrongful termination2.1. If the defendant had not terminated the contract, even then it still would have been deprivedof the benefits as the plaintiff had merely started with the designing and manufacturing processand the defendant could not make use of the sports and recreational facilities as its construction3 Painter, Richard, and Ann Holmes. Cases and materials on Employment Law. Oxford University Press, USA,2015.4 [1962] 2 QB 26
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