Often when seeking to imply a term in a contract, a party will claim that the term should be implied because it is ‘necessary to give business efficacy’ to the contract. What might this mean, in practical terms?

The New South Wales Court of Appeal, in a split decision, has allowed an appeal against a judgment granting equitable set-off. The Court’s decision provides a useful overview of the law of equitable set-off. In overturning the trial judge’s decision, the Court also considered the scope and application of the so-called Brickenden principle which prohibits speculation by a defaulting fiduciary as to what would have happened had there been no default.

In Patel v Sengun Investment Holdings Pty Ltd [2023] VSCA 238, the Victorian Court of Appeal has held that a document styled as a ‘Heads of Agreement’ for the sale of land was capable of specific performance as a binding contract. This was in circumstances where the Court accepted the document’s characterisation as a contract not for the purchase of the subject property but for a ‘call option’ for its potential later purchase.

The Full Court of the Federal Court has ruled on the question of whether or not a person seeking to trace money or property must first establish the existence of a fiduciary relationship. In analysing the divergent views evident in a number of cases, the Court in RnD Funding Pty Ltd v Roncane Pty Ltd [2023] FCAFC 28 unanimously held that a fiduciary relationship is not a precondition.

Typically, a plaintiff suing for breach of trust or breach of fiduciary duty must elect between different and inconsistent equitable remedies: either equitable compensation or an account of profits. The New South Wales Court of Appeal has considered the question of whether a plaintiff can overcome this need for choice when suing multiple defendants, and the Court’s decision in Xiao v BCEG International (Australia) Pty Ltd [2023] NSWCA 48 sets out the guiding principles for when a plaintiff may make a ‘split election’.

Stubbings v Jams 2 Pty Ltd [2022] HCA 6, a case involving asset-based lending, a finding of unconscionable conduct at trial, a reversal on intermediate appeal and, ultimately, a decision by the High Court to uphold the trial judgment, provides some valuable lessons for those involved in consumer lending. The case also features a number of clear developments in the law of unconscionable conduct, even if incremental, which are capable of applying to a variety of situations.

In a case where a purchaser sought to terminate a contract for the sale of land and recover a deposit paid, the Court of Appeal in Willis v Crosland [2021] VSCA 320 has construed what it means to be ‘in default’ under a particular type of standard form contract. The Court also has set out clearly the interaction between two key doctrines of contract law: repudiation and termination for breach. These are principles of relevance not only to conveyancing matters but also to contractual disputes generally.

The dispute in Kennedy v Proctor [2021] VSC 521 involved, at its heart, a simple question: had a competition horse, purchased by one friend for another and claimed to have been a gift, in fact been a gift? Of greater significance to appellate practice, however, the case demonstrates the difficulty in seeking to overturn a court’s decision on grounds of its assessment of trial evidence. The decision is illustrative, therefore, of the tasks parties face either in prosecuting or in defending against such an appeal.

The case of Baba v Sheehan [2021] NSWCA 58 involved a challenge to the validity of an exercise of power of removal and appointment of a trustee. In dismissing a claim that the power had been exercised for a foreign or extraneous purpose, the New South Wales Court of Appeal has provided guidance on the scope of trust powers and the importance of intention and good faith when ascertaining the validity of the exercise of a power.

The New South Wales Court of Appeal has allowed an appeal against orders for distribution from a co-mingled fund held by insolvent entities and, in doing so, has provided guidance for liquidators and creditors alike on the various methods for distribution and the principles of tracing.

A person who succeeds in recovering a ‘debt or sum certain’ in litigation is entitled to interest on that amount unless there is good cause to the contrary. But what qualifies as a ‘debt or sum certain’? If you sue for an amount in the form of compensation and are paid it before judgment is entered, have you ‘recovered’ that amount? The Victorian Court of Appeal has recently addressed these concepts in the case of Carbone v Melton City Council [2020] VSCA 117.

Parties to commercial contracts enjoy — and are burdened by — the implied duty that they cooperate in carrying out their respective ends of the bargain so that they each can have the benefit of the contract. The situation can become complicated where the contract expressly contains a mechanism for one party to seek the other’s consent to a particular course of action. Where the contract states that consent must not unreasonably be withheld, is there a binding promise not to unreasonably withhold consent? And how does the implied duty to cooperate interact with the concept of ‘reasonableness’? The Full Court of the Supreme Court of South Australia recently considered such issues.