Jarvis v Pitt Limited

The case of *Jarvis v Pitt Limited* involved an appeal to the High Court of Australia from the Supreme Court of South Australia. The dispute concerned a contract for the supply of freestone for the construction of the Bonython Hall at the University of Adelaide. The appellant, Jarvis, was the building contractor who had successfully tendered for the construction, while the respondent, Pitt Limited, was the quarry owner whose stone was specified in the building contract. The core of the disagreement was whether Jarvis had contractually bound himself to Pitt Limited to purchase all the necessary freestone from Pitt's quarries.

The legal issues before the High Court were whether a contract had been formed between Jarvis and Pitt Limited for the supply of all the freestone required for the Bonython Hall, and if so, what were the terms of that contract. Specifically, the court had to determine if Pitt Limited's statement of prices and terms constituted a binding offer to supply all the stone, and if Jarvis's actions, including his tender and subsequent orders, amounted to an acceptance of that offer, thereby obliging him to take the entire quantity of stone specified.

The High Court, in a joint judgment by Rich, Dixon, Evatt, and McTiernan JJ., and a separate concurring judgment by Starke J., held that a contract had indeed been formed. The court reasoned that Pitt Limited's statement of prices and terms, provided to all potential tenderers at the architects' request, was not merely a price list but a proposal for a binding agreement. This proposal was understood by builders, including Jarvis, to be the basis upon which they could confidently prepare their tenders, knowing they would be able to secure the specified stone at those prices. The acceptance of Jarvis's tender by the University, in conjunction with the specifications requiring stone from Pitt Limited's quarries and Jarvis's subsequent actions of ordering stone, completed the formation of the contract. The court found that the offer was to supply all the stone, and acceptance implied a promise to take the entire quantity. Starke J. emphasised that ordinary business prudence required the quarry-master to be under an obligation to supply the stone, and the evidence, including the tender being based on the quoted prices and subsequent orders, justified the conclusion of a contract for the whole amount.

The appeal was dismissed with costs.