Seal Rocks Victoria (Australia) Pty Ltd v State of Victoria [2003] VSC 85

Seal Rocks Victoria (Australia) Pty Ltd v State of Victoria [2003] VSC 85 - VSC 2003 case summary — Zoe

[39]

"In my opinion the error that is contained in the argument for the appellants consists in treating rules which constitute useful guidance in the ascertainment of damages as rigid rules of universal application, instead of treating them as prima facie rules which may be displaced or modified whenever it is necessary to do so in order to achieve a result which provides reasonable compensation for a breach of contract without imposing a liability upon the other party exceeding that which he could fairly be regarded as having contemplated and been willing to accept. The achievement of such a result is the purpose of the principles laid down in Hadley v Baxendale as explained in subsequent cases, including those to which Gibbs J has referred in his judgment in the present case. I add a reference to some observations made in the case of Monarch Steamship Co Ltd v Karlshamns Oljefabriker. Lord Wright referred to 'the broad general rule of the law of damages that a party injured by the other party's beach of contract is entitled to such money compensation as will put him in the position in which he would have been but for the breach.' The entitlement of the injured party is limited of course by the requirement that the damages must not be too remote. Lord Wright went on to say that remoteness 'is in truth a question of fact' and he cited a passage from the speech of Lord Haldane in an earlier case, to the effect that the apparent discrepancies found in the statements of general principles governing damages are due mainly to the varying nature of the particular questions which have arisen in different cases and to the need to mould the expression of the general principles, in applying them to the circumstances of particular cases. Lord de Parcq expressed agreement with what Lord Wright had said and added: 'Circumstances are so infinitely various that, however carefully general rules are framed, they must be construed with some liberality, and not too rigidly applied. It was necessary to lay down principles lest juries should be persuaded to do injustice by imposing an undue, or perhaps an inadequate, liability on a defendant. The court must be careful, however, to see that the principles laid down are never so narrowly interpreted as to prevent a jury, or judge of fact, from doing justice between the parties. So to use them would be to misuse them'."[13]

(citations omitted)

[42]

"In a civil case like this, where there is no direct evidence of a fact that a party bearing the onus of proof seeks to prove, 'it is not possible to attain entire satisfaction as to the true state of affairs': Girlock (Sales) Pty. Ltd. v. Hurrell [1982] HCA 15; (1982) 149 C.L.R. 155 at 169, per Mason J. In such a case, however, the law does not require proof to the 'entire satisfaction' of the tribunal of fact. A definition of the sufficiency of circumstantial evidence in a civil case to support proof by inference from the directly proved facts was given by the High Court in the unreported case of Bradshaw v. McEwans Pty. Ltd. (27 April 1951) in a passage since repeatedly adopted: e.g. Luxton v. Vines [1952] HCA 19; (1952) 85 C.L.R. 352 at 358; Holloway v. McFeeters [1956] HCA 25; (1956) 94 C.L.R. 470 at 480-1; Jones v. Dunkel, at 304; Girlock's case, at 161 and 168. The relevant passage in _Bradshaw's c_ase is this - 'Of course as far as logical consistency goes many hypotheses may be put which the evidence does not exclude positively. But this is a civil and not a criminal case. We are concerned with probabilities, not with possibilities. The difference between the criminal standard of proof in its application to circumstantial evidence and the civil is that in the former the facts must be such as to exclude reasonable hypotheses consistent with innocence, while in the latter you need only circumstances raising a more probable inference in favour of what is alleged. In questions of this sort, where direct proof is not available, it is enough if the circumstances appearing in evidence give rise to a reasonable and definite inference: they must do more than give rise to conflicting inferences of equal degrees of probability so that the choice between them is mere matter of conjecture: see per Lord Robson, Richard Evans & Co. Ltd. v. Astley [(1911) A.C. 674, at p.687]. But if circumstances are proved in which it is reasonable to find a balance of probabilities in favour of the conclusion sought then, though the conclusion may fall short of certainty, it is not to be regarded as a mere conjecture or surmise ...' "

[48]

"808. Although it may be possible by reference to the May 2000 business plan to access [sic] what revenue the Claimant has earned over 435 days. The difficulties are created by the costs and expenses of bringing Stage 2 to operation. It may be much cheaper than the parties anticipate so that the likely revenues return as stated in the business plan are excessive. Conversely, it may be much more expensive. During the hearing figures were bandied about that Stage 2 may cost anywhere between $30m and in excess of $100m. The parties anticipate the price of an entry ticket in the first year of operation of Stage 2 to be $35 for adults and $15 for children and forecast gross revenues in excess of $15m in the first year. Ultimately, the price of the ticket will be dictated by what the development will cost and what the market can afford to pay for a ticket. If the cost is nearer to $100m, which I believe it will be, the price of tickets will be much higher than $35 for an adult. In my opinion the ultimate cost will be largely determined by the difficulties of constructing, ventilating and making 'risk proof' the tunnel. The relevant State Authorities will require a quick evacuation of the tunnel. Bearing all these factors in mind, it is simply too difficult to arrive at an amount of compensation which should be paid by the State to the Claimant. The Claimant for its part urges that I accept the return of revenue forecast in its May 2000 business plan. For its part the State submits it is all 'pie in the sky'. Because of all these difficulties I am simply unable to arrive at an amount of compensation. If I did so, it would necessarily require me to ignore most of the factors which I have identified that create this dilemma for me and which I consider to be significant. In assessing compensation it is simply too difficult to arrive at a sum. The Claimant for its part urges that I accept the return of revenue forecast by the parties in amended Model 5 and in its business plan. For its part the State submits it is all 'pie in the sky'. Because of all these difficulties I am simply unable to arrive at an amount of compensation. If I did so, it would necessarily require me to ignore most of the factors which I have identified that creates this dilemma for me and which I consider to be significant." [sic]

At a glance

Court

Decision date

Before

Source

Judgment (70 paragraphs)

Parties

Cases Cited (4)