Knowledge (XXG)

McRae v Commonwealth Disposals Commission

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175:
for the failure of the condition precedent, and parties would be restored to their original position. However, in a case where only one party has knowledge of the subject matter (such as the present circumstances), and the other simply relies on what the first party intimates, then there could be no condition precedent. The first party promises or guarantees the existence of the subject matter and will be in breach if it does not exist.
179:
that there was a tanker; (3) the fact that there was no tanker made it certain that this expense would be wasted. The plaintiffs have in this way a starting-point. They make a prima-facie case. The fact that the expense was wasted flowed prima facie from the fact that there was no tanker; and the first fact is damage, and the second fact is breach of contract."
174:
A general ruling that can be gleaned from the court's judgment is that in circumstances where parties have equal knowledge as to the existence of the subject matter, and it turned out to be false, then it would justify the implication of a condition precedent. In that case, the contract would be void
144:
supposedly containing oil. The McRae brothers went to Samarai and found no tanker, and that there was no such place as the Jourmand Reef. It later became clear that the Commission officer had made a 'reckless and irresponsible' mistake in thinking that they had a tanker to sell (the Court found that
178:
The High Court considered the measure of damages, as this was not a simple case of nondelivery of goods. In opposition to CDC’s argument that McRae’s expenditure was not wasted, Dixon and Fullagar JJ stated: “They can say: (1) this expense was incurred; (2) it was incurred because you promised us
152:
Furthermore, in relation to the expenditure incurred by McRae, the CDC argued that “Non constat that the expenditure incurred by the plaintiffs would not have been equally wasted. If the promise that there was a tanker in situe had been performed, she might still have been found worthless or not
148:
The McRae brothers commenced an action claiming damages against the Commission. First they claimed damages for breach of contract to sell a tanker at the location specified. Second, they claimed damages for fraudulent misrepresentation that there was a tanker. Third, they claimed damages for a
149:
negligent failure to disclose that there was no tanker at the place specified after the fact became known to the Commissioner. CDC argued there was no liability for breach of contract because it was void given the subject matter did not exist.
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was distinguished because there the parties had both shared the assumption the corn existed, but here CDC had actually promised the tanker existed and therefore had assumed the risk that it did not.
153:
susceptible of profitable salvage operations or of any salvage operations at all. How, then… can the plaintiffs say that their expenditure was wasted because there was no tanker in existence?"
221:
John Gava, "Sir Owen Dixon, Strict Legalism and McRae v Commonwealth Disposals Commission" (2009) 9 Oxford University Commonwealth Law Journal 141 (No 2, Winter 2009)
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held that McRae succeeded in damages for breach of contract. They rejected the contract was void because CDC had promised the tanker did exist.
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they had relied on mere gossip). The McRae brothers incurred considerable expense in fitting out a salvage operation.
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Robert Brooking, "Contract - Mistake - Non-Existent Subject-Matter" in "Case Notes" (1952)
40: 199: 286: 230:
Dennis Paling, "McRae v Commonwealth Disposals Commission - A Forgotten Decision" (1975)
44: 125: 307: 204: 252: 245: 231: 83: 90: 238: 141: 255:
Res Judicatae: The Magazine of the Law Students' Society of Victoria
248:
Queensland Justice of the Peace and Local Authorities' Journal 149
140:
sold McRae a shipwreck of a tanker on the "Jourmand Reef", near
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J G Fleming, "Common Mistake" (1952) 15 Modern Law Review
274: 272: 270: 268: 97: 75: 70: 59: 54: 36: 28: 23: 128:about the possibility of performing an agreement. 244:"Non-Existent Subject-Matter of Contract" (1951) 288: 46: 8: 20: 279:McRae v Commonwealth Disposals Commission 113:McRae v Commonwealth Disposals Commission 24:McRae v Commonwealth Disposals Commission 234:New Zealand Law Journal 174 (6 May 1975) 264: 7: 14: 138:Commonwealth Disposals Commission 16:1951 Australian contract law case 1: 324:High Court of Australia cases 350: 194:Frustration in English law 314:English contract case law 102: 319:Australian contract law 163:High Court of Australia 118:Australian contract law 32:High Court of Australia 334:1951 in Australian law 207:, (1867) LR 2 HL 149, 283:[1951] HCA 79 205:[1867] UKHL 1 41:[1951] HCA 79 189:English contract law 122:English contract law 45:(1951) 84  168:Courturier v Hastie 120:case, relevant for 241:(No 2, April 1952) 226:Taylor and Francis 259:(No 1: July 1952) 124:, concerning the 109: 108: 341: 329:1951 in case law 298: 290: 276: 71:Court membership 48: 21: 349: 348: 344: 343: 342: 340: 339: 338: 304: 303: 302: 301: 277: 266: 218: 200:Cooper v Phibbs 185: 159: 134: 17: 12: 11: 5: 347: 345: 337: 336: 331: 326: 321: 316: 306: 305: 300: 299: 263: 262: 261: 260: 249: 242: 235: 228: 217: 214: 213: 212: 209:House of Lords 196: 191: 184: 181: 158: 155: 133: 130: 126:common mistake 107: 106: 100: 99: 95: 94: 77: 76:Judges sitting 73: 72: 68: 67: 61: 57: 56: 52: 51: 38: 34: 33: 30: 26: 25: 15: 13: 10: 9: 6: 4: 3: 2: 346: 335: 332: 330: 327: 325: 322: 320: 317: 315: 312: 311: 309: 296: 292: 284: 280: 275: 273: 271: 269: 265: 258: 254: 250: 247: 243: 240: 236: 233: 229: 227: 224: 220: 219: 215: 210: 206: 202: 201: 197: 195: 192: 190: 187: 186: 182: 180: 176: 172: 170: 169: 164: 156: 154: 150: 146: 143: 139: 131: 129: 127: 123: 119: 115: 114: 105: 101: 96: 92: 89: 85: 81: 78: 74: 69: 66: 62: 60:Appealed from 58: 53: 50: 42: 39: 35: 31: 27: 22: 19: 297:(Australia). 278: 198: 177: 173: 166: 160: 151: 147: 135: 112: 111: 110: 55:Case history 18: 104:Frustration 63:High Court 308:Categories 295:High Court 287:(1951) 84 216:References 80:McTiernan 49: 377 37:Citations 223:Adelaide 183:See also 157:Judgment 116:, is an 98:Keywords 88:Fullagar 142:Samarai 65:Webb J 281: 203: 132:Facts 84:Dixon 29:Court 211:(UK) 161:The 136:The 86:and 291:377 289:CLR 239:229 47:CLR 310:: 293:, 285:, 267:^ 246:45 232:50 91:JJ 82:, 43:, 257:3 253:6 93:.

Index

[1951] HCA 79
(1951) 84 CLR 377
Webb J
McTiernan
Dixon
Fullagar
JJ
Frustration
Australian contract law
English contract law
common mistake
Commonwealth Disposals Commission
Samarai
High Court of Australia
Courturier v Hastie
English contract law
Frustration in English law
Cooper v Phibbs
[1867] UKHL 1
House of Lords
Adelaide
Taylor and Francis
50
229
45
6
3


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