Wenpac Pty Ltd v Allied Westralian Finance Ltd

This matter came before the High Court of Australia concerning an application for special leave to appeal by Allied Westralian Finance Ltd (the appellant) against Wenpac Pty Ltd (the respondent). The dispute arose from the respondent's failure to exercise an option, which the appellant contended was due to misleading conduct.

The High Court was required to determine whether the Full Court of the Federal Court had correctly interpreted and applied section 87 of the relevant legislation. Specifically, the court needed to consider whether the Full Court had misunderstood the scope of section 87 in relation to the respondent's claim, particularly concerning the necessity of exercising the option to enable the court to grant relief.

Mason CJ, in his judgment, indicated that the respondent likely had no reasonable prospect of successfully opposing the appellant's claim. His Honour's reasoning focused on three propositions that underpinned the Full Court's decision, which he found to be contrary to the pleaded facts or a misapprehension of section 87. These propositions related to the cause of the omission to exercise the option, the respondent's knowledge of the consequences of non-exercise, and the availability of a remedy to recover the option price. Mason CJ suggested that the Full Court had erred in believing the option needed to be exercised for section 87 to operate, when the respondent was seeking to have the option remoulded, and the time for doing so had elapsed.

The Chief Justice indicated that he rejected the suggestion that the form of order to be made in the case was limited in the manner contended for by the respondent.