Hanson Construction Materials Pty Ltd v Siely Pty Ltd

Hanson Construction Materials Pty Ltd appealed to the New South Wales Court of Appeal against a judgment of the Supreme Court of New South Wales, which had found in favour of Siely Pty Ltd. The dispute concerned the lawfulness of Hanson's termination of a contract with Siely, and the quantum of damages awarded to Siely.

The Court of Appeal was required to determine whether Siely had engaged in serious misconduct, thereby entitling Hanson to terminate the contract. It also had to consider the relevance of Hanson's subjective belief regarding Siely's conduct in assessing the lawfulness of the termination, and whether the damages awarded by the trial judge were excessive.

The Court of Appeal found that Siely's conduct did not amount to serious misconduct as contemplated by the contract. It held that the contractual right to terminate for serious misconduct required an objective assessment of the conduct itself, rather than being solely dependent on the terminating party's subjective belief. Consequently, Hanson's termination was deemed unlawful. However, the Court also found that the quantum of damages awarded by the trial judge was excessive, and that Siely was only entitled to a lesser amount.

The appeal and cross-appeal were allowed. The original judgment in favour of Siely for $216,156 was set aside. Instead, Siely was awarded judgment for $66,000, with interest. The costs of the appeal were ordered to be paid by Siely to Hanson, while the costs of the cross-appeal were ordered to be paid by Hanson to Siely.