The third edition of this work analyses a number of commonly found boilerplate clauses in commercial contracts and illustrates, through case law, how the various forms of these clauses have been judicially interpreted. At the conclusion of each chapter, from the previous analysis, the book provides recommendations for the practitioner as to the issues that should be taken into account when drafting such clauses. The emphasis of the book is upon the application of the principles of contract directly in relation to the construction of contracts and is not merely a recitation of those principles. A number of recent cases have been added to this edition to illustrate points of construction. Several deserve specific mention:
Australian Securities and Investments Commission v Kobelt (2019) 267 CLR 1
Good Living Company Pty Ltd v Kingsmede Pty Ltd (2021) 284 FCR 424 (FCAFC) (statutory unconscionability)
Australian Securities and Investments Commission v Bendigo and Adelaide Bank Limited  FCA 716 (analysis of certain unfair contractual terms)
Seymour Whyte Constructions Pty Ltd v Ostwald Bros Pty Ltd (in liq) (2019) 99 NSWLR 317 (NSWCA) (rectification of contract principles restated)
Adaz Nominees Pty Ltd v Castleway Pty Ltd  VSCA 301 (implied term of cooperation)
Macquarie International Health Clinic Pty Ltd v Sydney Local Health District (2020) 19 BPR 40,463;  NSWCA 161 (implication of term of good faith)
Pittmore Pty Ltd v Chan; Chan v Tan (2020) 106 NSWLR 62 (NSWCA) (dealing with absurdity in construction)
JPA Finance Pty Ltd v Gordon Nominees Pty Ltd (2019) 58 VR 393 (VSCA) (termination notices)
Kay v Playup Australia Pty Ltd  NSWCA 33 (penalty clauses)
Advanced National Services Pty Ltd v Daintree Contractors Pty Ltd  NSWCA 270 (consequences of assignment of contractual rights without consent required)
Fu Tian Fortune Pty Ltd v Park Cho Pty Ltd  NSWCA 282 (what constitutes ovation)
Compass Marinas Australia Pty Ltd v Queensland (2021) 9 QR 703 (condition precedent to calling upon guarantee)
Reid v Commonwealth Bank of Australia  NSWCA 134 (limits to deed of release of guarantee)
Argyle Lending Pty Ltd v Lantouris  VSCA 60 (interaction of indemnity with concurrent guarantee)
Masters Home Improvement Australia Pty Ltd (formerly Shellbelt Pty Ltd) v North East Solution Pty Ltd (2017) 372 ALR 440 (VSCA) (enforcement of dispute resolution clause)
Joshan v Pizza Pan Group Pty Ltd (2021) 106 NSWLR 104 (NSWCA) (exclusive jurisdiction clauses)
In addition, the book goes beyond the bounds of the common law of contract and also examines how the application of relevant statute law such as the Australian Consumer Law provisions relating to unconscionability, statutory guarantees and unfair terms impact the construction of certain contracts. Significant recent amendments to the Australian Consumer Law on Unfair Contracts affecting construction have been extensively analysed.
Table of Cases
Table of Statutes
1. Contracts in Contemporary Commercial Dealings
2. General Principles for Construction of Contracts
4. Liquidated Damages Clauses
5. Exclusion and Limitation of Liability Clauses
6. Entire Agreement Clauses
7. Passing of Risk in Real Property Transactions
8. Force Majeure
9. Contingent Conditions
10. Time Provisions
11. Confidentiality Clauses
12. Notice Provisions
13. Further Assurance and Cooperation
19. Dispute Resolution Clauses
20. Governing Law and Jurisdiction Clauses
The Construction and Performance of Commercial Contractsprovides readers with a comprehensive understanding of contract construction in a commercial context as it applies to business arrangements between a vast range of parties from multi-national companies to individual consumers. This excellent new edition addresses the law that is generally stated as of 1 May 2023, analysing both seminal and recent decisions in the area in a clear, succinct and easily digestible way. It provides both practical guidance on general issues of construction and a detailed analysis of specific clauses about which issues are frequently encountered in negotiating commercial contracts and disputes about them.
Among other updates, this third edition: comprehensively addresses legislative amendments to the Australian Consumer Law in the area of unfair terms; introduces a new section to the chapter on Entire Agreement Clauses exploring the reception of No Oral Modification clauses into Australian Law; expands coverage of force majeure and indemnity clauses; updates the Governing Law and Jurisdiction chapter; and updates the Notices chapters to consider recent case law developments, including the evolving use of electronic communication methods prevalent in today’s digital age.
As with previous editions, The Construction and Performance of Commercial Contracts is recommended to those studying, drafting, implementing or enforcing commercial contracts in Australia.
H Lilley of Counsel, Queensland Law Reporter – 11 August 2023
Reviews of previous editions
It is a comprehensive yet highly readable work with clear referencing suitable for any practitioner (or student). The authors have achieved their objective of providing a clear analysis of a broad range of common clauses (in various forms). It has a visible place on my bookshelf, readily available for regular use.
Victor Hamit, InPrint, Law Institute Journal Victoria, March 2019
A considerable amount of the work of commercial courts these days is occupied by construing contracts made between business people. Part of the reason for this is that many business people give what they contemptuously call “the paper work” very low priority and assume that all parties to a transaction will share the same view of the transaction as themselves. The work of the courts is not made easier by the problem that our High Court and the English commercial courts have adopted significantly different approaches to the construction of commercial contracts.
This book aims to assist with these problems. However, it does so in a different way to the approach taken by Lewison and Hughes in their seminal text, The Interpretation of Contracts in Australia (Lawbook Co, 2012). Only one chapter of the present book focuses on how the basic approach to the construction of commercial contracts differs from the approach to “ordinary” contracts. However, that treatment is a good summary of the current position, though it lacks the depth that the citation of a wider selection of utterances from the authorities would have given it.
Apart from the introductory chapter, the other chapters deal with particular aspects of commercial contracts. Thus, Ch 6 deals with entire agreement clauses in 16 pages, Ch 9 deals with contingent conditions in 20 pages and Ch 10, with time provisions in 26 pages. Other chapters are “Notice Provisions”, “Novation”, “Nomination”, “Guarantees”, “Indemnities”, and “Dispute Resolution Clauses”. In each of these chapters, particular problems of construction are addressed, including how the courts have approached standard clauses such as “subject to finance”.
It is good that the authors have taken a different approach to the subject as their book is not a duplication of existing texts, but rather is a useful complementary work to them.
Peter W Young AO, Australian Law Journal, August 2015
This is an excellent reference book for all lawyers who work in the drafting of contracts or in relation to contractual disputes.
The practical experience of the authors’ is evident in the way the book is written. The content is structured in a very logical way. … The book is useful for any practitioner. It is in plain English. It gives very practical advice.
This book will live in the shelf next to my desk as a reference in relation to the construction of all contracts that I need to draft or consider. It is very clear, precise and useful.
Uwe Boettcher, Ethos, ACT Law Society, December 2014
This excellent new work provides substantial practical guidance for both general issues of construction of contracts but more particularly, to issues that arise in relation to the construction of specific clauses frequently encountered in commercial contracts. The Construction and Performance of Commercial Contracts is recommended to all those involved in drafting, implementing and enforcing commercial contracts in Australia.
Peter Lithgow, Australian Business Law Review, October 2014