[The name of the case, information about the court and headnote] 

Electronic Industries Ltd v David Jones Ltd

(High Court; 26 November 1954; 91 CLR 288)

[293] THE COURT (DIXON CJ; McTIERNAN, WEBB, KITTO and TAYLOR JJ): 1,086 pounds [was] awarded by Kinsella J as damages for breach of contract. The judgement was reversed by the Full Court of the Supreme Court [of NSW].

[Summary of the material facts of the case] 

The contract was expressed in correspondence concluding with a telegram of 20 May 1949. The defendant conducts a departmental store in Sydney and the plaintiff an electrical business in Melbourne. The material terms [294] of the contract between the parties were that the plaintiff for 2,500 pounds would install equipment in the defendant's store and give demonstrations of television from 11 July to 23 July 1949. The purpose was to draw customers to the store. Before 11 July a serious coal strike began in New South Wales. As a result there was a considerable falling off in the number of shoppers coming into the city. The defendant decided that it had become inopportune to proceed. Over the telephone the plaintiff in Melbourne was informed of the situation in Sydney and asked if it would postpone the demonstration until another date could be fixed. This conversation evoked from the plaintiff a letter dated 30 June which proceeded: "We appreciate the difficulties you face and although it involves considerable reshuffling of our own arrangements, we will be pleased to vary our agreement with you by an alteration of the dates of the demonstration." Then followed a suggestion that on 22 August the two weeks should commence. To this letter the defendant did not reply until after 11 July. [295] The result was to dispense the plaintiff from tender of performance on the due date.

On 14 July the defendant did reply. He said his company wished to postpone any fixed date. The defendant would prefer to discuss the matter when the industrial position had become clear. The plaintiff did not reply until 1 September. The letter [296] proceeded: "In view of the settlement some weeks ago of the coal strike and the fact that the general position is now rapidly returning to normal, we would like to ask if you are yet able to indicate your wishes as to dates etc., so that we might complete an itinerary for our television equipment." This produced from the defendant a letter declining to proceed at "this late date?'. The writer gave the reason that . . . we wished to have television in the store . . . during a certain period of the winter months when we would be able to efficiently handle the crowds which it would bring into the store. At the present time, and during the summer period, we find that the store is crowded each day and therefore if we were to install television during this period we would overcrowd the store, which would naturally have a detrimental effect on our trade.

After some further interchange of letters the plaintiff treated the contract as repudiated and sued.

[Statement of the particular questions that must be decided]

The contention of the defendant is that the contract became unenforceable for lack of a time certain for its performance. Originally the missing term was there but subsequently the parties removed it and until it was replaced the contract was void for uncertainty.

[A review of the relevant law, its development and interpretation] 

[297] Of course if the parties did intend to keep the original agreement no longer on foot, to rescind it, that is the end of the matter. But it is certain that they did not. The plaintiff always meant to perform it and hold the defendant bound to it. All it did was to accede to the defendant's request for a postponement. Both parties remained bound. The fact that there was no longer a fixed date for performance brought into application the principles which impose on parties, in all cases where performance requires cooperative acts, the duty of complying with reasonable requests made by the other. [298] By appropriate demand the plaintiff was entitled to require the defendant to make its store available to the plaintiff at some reasonable time. It is hardly necessary to repeat that what is reasonable depends on all the circumstances.

Example after example could be given of contracts for work or services where one man must make himself or his premises or goods available at some mutually convenient time. A contract to tailor a suit of clothes, to decorate the interior of a building or to repair a ship's hull is not unenforceable because no time is fixed for the attendance of the customer or the commencement of the decorator's work or entry of the ship into a dry dock.

[The application of the the law to the facts to draw conclusions]

[299] It is said that this is a different case because the parties made the fixing of a date the sine qua non of their obligations. At no time did they stipulate expressly or impliedly that unless they agreed on a new date the contract should be at an end. The intention was that the contract should go on.

The appeal should be allowed.

Note: Abridged judgement from Australian Cases on Contract, 2002 edition, MO Ellinghaus