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Key decisions

  • Cessnock City Council v 123 259 932 Pty Ltd [2024] HCA 17
  • Godolphin Australia Pty Ltd v Chief Commissioner of State Revenue [2024] HCA 20


Wasted expenditure

In Cessnock City Council v 123 259 932 Pty Ltd [2024] HCA 17 (8 May 2024) the High Court was required to determine the evidence required to establish reliance-based damages for a breach of contract.

For contract law enthusiasts, like the writer, this High Court decision is a special treat. The facts read like a contract law exam question. The appellant (‘Council’) owns land on which the Cessnock Airport is located. The Council intended to develop the land and extend the airport’s operations. The Council and Mr Johnson, who later became the principal of the respondent company (‘Company’), met and discussed building an aircraft hangar on the land that would incorporate an aviation museum and an entertainment venue for corporate events. The Council and the Company subsequently entered into an agreement for a lease of a proposed Lot 104 on the land (‘Agreement’). The proposed 30-year lease to the Company was subject to the registration of a plan of subdivision. The Agreement contained a clause, cl 4.2(a)(2), pursuant to which the Council promised to take all reasonable action to apply for and obtain registration of the plan of subdivision by a ‘Sunset Date’. If no plan of subdivision was registered by the Sunset Date then each party was entitled to terminate the Agreement. The Company was given a licence to the area to build the hangar.

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