Queensland Nickel Pty Limited v. Commonwealth of Australia

Queensland Nickel Pty Limited (in liquidation) (QN) sought to recover from the Commonwealth of Australia (the Commonwealth) amounts paid under a deed of indemnity. QN alleged that the Commonwealth had breached its obligations under the deed, which was entered into in connection with the sale of the North West Shelf Project. The dispute ultimately came before the High Court of Australia.

The central legal issue before the High Court was whether the Commonwealth had breached its contractual obligations under the deed of indemnity by failing to take all reasonable steps to ensure that the sale of the North West Shelf Project was completed by a specified date. QN contended that the Commonwealth's actions and omissions amounted to a failure to exercise reasonable care and skill in the conduct of the sale process, thereby breaching the indemnity.

The High Court considered the terms of the deed of indemnity and the surrounding circumstances. It analysed the nature of the Commonwealth's obligations, distinguishing between a contractual obligation to achieve a particular result and an obligation to use reasonable endeavours. The Court found that the deed imposed an obligation on the Commonwealth to take all reasonable steps to ensure the sale was completed by the specified date, which required the exercise of reasonable care and skill. However, the Court ultimately held that QN had failed to establish that the Commonwealth had breached this obligation. The evidence did not demonstrate that the Commonwealth had acted unreasonably in its conduct of the sale process, nor that any alleged failures had caused QN loss.

The High Court dismissed QN's appeal.