Kimberley Homes Pty Limited v APM Wood Products Pty Limited

Kimberley Homes Pty Limited (the appellant) appealed to the New South Wales Court of Appeal against a decision of the Supreme Court of New South Wales. The dispute concerned a contract for the supply of timber flooring by APM Wood Products Pty Limited (the respondent) to Kimberley Homes. Kimberley Homes alleged that the timber supplied was defective and not fit for its intended purpose, leading to a claim for damages.

The primary legal issues before the Court of Appeal were whether the timber supplied by APM Wood Products was of merchantable quality and fit for the particular purpose for which it was required by Kimberley Homes, as stipulated by the Sale of Goods Act 1923 (NSW). The court was also required to consider whether Kimberley Homes had accepted the goods, thereby precluding it from rejecting them and claiming damages for breach of contract.

The Court of Appeal found that the evidence did not establish that the timber was inherently defective or unfit for the purpose of flooring. While there were some issues with the installation and subsequent treatment of the timber, these were not attributable to a breach of contract by APM Wood Products. The court held that Kimberley Homes had, through its conduct, accepted the timber, and therefore could not rely on the implied conditions of merchantable quality and fitness for purpose to claim damages. The appeal was dismissed.