Ailakis v Olivero [No 2]

In the case of Ailakis v Olivero [No 2], the plaintiff sought to enforce an agreement for the sale of shares in a company against the defendant. The dispute centred around the validity and enforceability of the agreement, the intent to create legal relations, the adequacy of consideration, and the availability of damages for non-delivery of goods. The Federal Court of Australia was tasked with resolving these issues.

The central legal issues revolved around whether the evidence of prior similar transactions was logically probative of the fact in issue, specifically the intent to create legal relations. Additionally, the court needed to determine whether the promise to draft a document regarding the agreement constituted good consideration. Another key issue was whether the plaintiff could terminate the contract due to the defendant's continuing repudiation, and if so, what damages were available for the non-delivery of goods.

The court held that the evidence of prior similar transactions was not logically probative of the objective intent to create legal relations. It was emphasised that the use of words such as 'give' and expressions of thanks and appreciation did not necessarily negate the intent to create legal relations in a commercial context. Regarding consideration, the court found that the promise made to a third party was good consideration, as the director's duties were not public duties. The court also concluded that the plaintiff could terminate the contract due to the defendant's continuing repudiation, and that damages were available for the non-delivery of goods, subject to restrictions inherent to the goods and personal to the promisee.

The court ordered that the defendant was liable for the breach of contract, and that the plaintiff was entitled to damages for the non-delivery of goods. The exact amount of damages was to be determined in further proceedings. The court also affirmed the termination of the contract by the plaintiff due to the defendant's continuing repudiation.