Gardam v WTH Pty Ltd

Gardam v WTH Pty Ltd concerned a dispute arising from a vehicle rental agreement. The appellant, Gardam, had rented a vehicle from the respondent, WTH Pty Ltd. Following damage to the vehicle, WTH sought to recover the cost of repairs from Gardam. Gardam relied on an exemption clause in the rental agreement which, while generally absolving the hirer of liability for damage, contained a proviso that the exemption would not apply if the driver's blood alcohol content exceeded the legal limit. The matter was heard by the Full Court of the Supreme Court of Tasmania.

The central legal issues before the court were twofold. Firstly, the court was required to determine the proper construction and effect of the exemption clause within the vehicle rental agreement, particularly in light of the proviso concerning the driver's blood alcohol content. Secondly, the court had to consider whether this proviso, and by extension the exemption clause, was rendered void by section 21 of the *Road Safety (Alcohol and Drugs) Act 1970* (Tas). This involved determining whether the clause constituted a contract of insurance or a waiver of rights.

The court reasoned that the exemption clause, read as a whole, did not create a contract of insurance but rather operated as a waiver of the respondent's right to claim damages from the appellant, subject to certain conditions. The proviso regarding blood alcohol content was a condition precedent to the operation of the waiver. As the appellant's blood alcohol content exceeded the legal limit at the time of the incident, the condition was not met, and therefore the waiver of liability did not apply. The court held that section 21 of the *Road Safety (Alcohol and Drugs) Act 1970* (Tas) did not render the clause void, as it did not purport to avoid liability for an offence under the Act, but rather defined the circumstances under which a contractual waiver of liability would be effective.

The appeal was dismissed.