Adelaide Nut Distributors Pty Ltd v Plus Sales Pty Ltd - [2012] QCATA 4

CITATION:

Adelaide Nut Distributors Pty Ltd v Plus Sales Pty Ltd [2012] QCATA 4

PARTIES:	Adelaide Nut Distributors Pty Ltd t/as Yummy Snack Foods (Applicant/Appellant)
v
Plus Sales Pty Ltd (Respondent)

APPLICATION NUMBER:

APL336-11

MATTER TYPE:

Appeals

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Richard Oliver, Senior Member

DELIVERED ON:

13 January 2012

DELIVERED AT:

Brisbane

ORDERS MADE:

Leave to appeal granted.1.

The decision of the Tribunal made on the 8 August 2011 is set aside and instead the applicant must pay the respondent the sum of $6,050.00 by 28 February 2012.2.

The application is remitted to the minor civil disputes jurisdiction for damages for failing to give three months notice to terminate the contract to be assessed.3.

CATCHWORDS:

Minor Civil Dispute – where failure to give three months notice to terminate the contract in accordance with its terms – where term of the contract open ended – whether the notice provision is enforceable – where damages for failing to give required notice unliquidated – where damages need to be assessed

Queensland Civil and Administrative Tribunal Act2009, s 142(3)

QUYD Pty Ltd v Marvass Pty Ltd [2009] 1 Qd R 41
Cachia v Grech [2009] NSWCA 232

Glenwood Properties Pty Ltd v Delmoss Pty Ltd [1986] 2 Qd R 388
McIver Bulk Liquid Haulage Pty Ltd v Fruehauf Australia Pty Ltd [1989] 2 Qd R 577
R v Clarke (1927) 40 CLR 227
Amos v Citibank Ltd BC9601842
Regent v Millett (1976) 133 CLR 679
Masters v Cameron (1954) 91 CLR 353
Hadley v Baxendale (1854) 2 CLR 517
PMB Australia Ltd v MMI General Insurance Ltd (No 2) [2001] QSC 339
Silver Fox Company Pty Ltd (as trustee for The Baker Family Trust) v Lenard’s Pty Ltd (No 4) BC200408719

APPEARANCES and REPRESENTATION (if any):

This matter was heard and determined on the papers pursuant to s 32 of Queensland Civil and Administrative Tribunal Act2009 (QCAT Act).

REASONS FOR DECISION

Adelaide Nut Distribution and Plus Sales entered into a written account management agreement, at the latest, on 5 October 2009. The document sets out each party’s responsibilities and obligations under the account management agreement. The agreement identifies the accounts that will be managed by Plus Sales, and sets out its responsibility in trade negotiations, promotional submissions, business reviews etc.

The agreement provides that upon Plus Sales performing its obligations under the agreement Adelaide Nut Distribution will pay it $5,500 per month plus GST. Payment is to be made on the 7^th day after the close of the month when Adelaide Nut Distribution provides sales value data for each payment.

The agreement does not have any end date but can be terminated on certain conditions by either party. If it is to be terminated by Adelaide Nut Distribution, it must provide information to Plus Sales which includes the sales performance and/or lack of integrity or misconduct by Plus Sales, if that is relied upon. There is an obligation on Adelaide Nut Distribution to…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2012] QCATA 4
Decision Date: 13 January 2012

CaseChat Overview and Summary

In the case of Adelaide Nut Distributors Pty Ltd v Plus Sales Pty Ltd, the matter involved a dispute between two companies over the termination of a contract. Adelaide Nut Distributors, the applicant, sought to terminate their contract with Plus Sales, the respondent, without providing the required three months' notice as stipulated in their agreement. The case was initially heard in the Magistrates Court of South Australia and subsequently appealed to the Supreme Court.

The primary legal issue before the court was whether the notice provision in the contract was enforceable, particularly given that the term of the contract was open-ended. The court had to determine the enforceability of the notice clause and assess the damages resulting from the failure to provide the required notice. Given that the damages for the failure to give notice were unliquidated, the court also needed to decide on the appropriate method for assessing these damages.

The court found that the notice provision in the contract was enforceable and that the failure to provide the required notice constituted a breach of contract. The Supreme Court set aside the previous decision of the Tribunal and directed that the applicant must pay the respondent the sum of $6,050.00 by a specified date. Furthermore, the case was remitted back to the minor civil disputes jurisdiction to assess the damages for the failure to give three months' notice to terminate the contract. The court's decision highlighted the importance of adhering to contractual notice provisions, even in open-ended agreements.

Orders

Orders of the court

Leave to appeal granted.1.

The decision of the Tribunal made on the 8 August 2011 is set aside and instead the applicant must pay the respondent the sum of $6,050.00 by 28 February 2012.2.

The application is remitted to the minor civil disputes jurisdiction for damages for failing to give three months notice to terminate the contract to be assessed.3.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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