Diveva Pty Ltd v Port Macquarie-Hastings Council

In this case, the plaintiff, Diveva Pty Ltd, a construction company, sued the defendant, Port Macquarie-Hastings Council, for breach of contract. The plaintiff alleged that the council had wrongfully exercised an option to terminate the contract for the supply, delivery, and laying of asphalt. The dispute was heard by the Supreme Court of New South Wales.

The court had to determine several issues, including the nature and purpose of the option provision in the contract. It was necessary to ascertain whether the option provision granted the plaintiff the right to extend the contract or if it was exercisable by the defendant council. The court also needed to decide if a term should be implied into the contract that the option was not exercisable if the plaintiff was in breach. Additionally, the court considered whether the plaintiff breached the contract and assessed the damages owed to the plaintiff. The court found that the option was exercisable by the defendant council and that the plaintiff breached the contract. The court held that the plaintiff was not entitled to have a term implied into the contract and dismissed the plaintiff's claim for damages for loss of chance.

The court concluded that the plaintiff was entitled to expectation damages for the breach of contract. The court found that the plaintiff had not failed to mitigate their loss and that the plaintiff was likely to be successful in future tenders. The court assessed the expectation damages and awarded the plaintiff $1,069,233.04, which represented the profit the plaintiff would have made if the contract had been performed. The court did not award damages for loss of chance as it found that the plaintiff had not demonstrated a real and substantial chance of success in renewing the contract.