Case: Mackay v Dick (1881) 6 App Cas 251
Outcome: applied
In the Annexure, beside the words 'Date for Delivery: (Clause 17)' are the words 'See Dates for Staged Delivery'. The amended Annexure, under the heading 'Stage of the Product (Clause 17.3)' includes (so far as is relevant) the following: ' Stage Two Future CBD Projects Pole Type Minimum Quantity per financial year starting July 1998 for 3 years A 100 B 100 C 60 D 40' 130 A related clause is cl 13 'Progress and Suspension', the relevant parts of which were as follows: ' 13.1 Rate of Progress The Supplier shall proceed with the work under the Supply Contract with due expedition and without delay. The Supplier shall not suspend the progress of the whole or any part of the work under the Supply Contract, except where the suspension is under Clause 25 or is directed or approved by the Council under Clause 13. The Supplier shall give the Council reasonable advance notice of any information documents or instructions required by the Supplier. The Council shall not be obliged to furnish information, documents or instructions earlier than the Council should reasonably have anticipated at the Date of Acceptance of Tender. 13.2 Contract Program For the purposes of Clause 13 a 'contract program' is a statement in writing showing the dates by which or the times within which the various stages or parts of the work under the Supply Contract are to be executed or completed. A contract program shall not affect rights or obligations in Clause 13.1. The Supplier will furnish to the Council a manufacturing program, including details of manufacture of the Production Sample in a form approved by the Council. The Supplier shall not, without reasonable cause, depart from: (a) a contract program included in the Supply Contract; or (b) a contract program furnished to the Council. The furnishing of a contract program or of a further contract program shall not relieve the Supplier of any obligations under the Supply Contract including the obligation to not, without reasonable cause, depart from an earlier contract program.' 131 Clause 16 deals with variations. Clause 16.1 is as follows: ' 16. VARIATIONS 16.1 Variations to the Product The Supplier shall not vary the work under the Supply Contract except as directed or approved by the Council under Clause 16. The Council may direct the Supplier to alter, add to or omit work under the Supply Contract. If the Supplier requests the Council to approve a variation, the Council may do so in writing. A direction or approval by the Council of a variation may be conditional. The conditions may include a condition that the Supplier shall not be entitled to any extension of time for delivery or for completion, or extra remuneration in respect of the variation or anything arising out of the variation which would not have arisen, had the variation not been approved. The Council shall not be obliged to direct or approve a variation to assist the Supplier. Unless the Council and the Supplier agree upon the price for a variation directed or approved under Clause 16, the variation shall be valued under Clause 16.2. Any Additional Product directed by the Council to be supplied by the Supplier under this Supply Contract will be valued in accordance with clause 16.2.' Clause 16.2 provides a method of valuation. 163 I am inclined to the view that the first part of the pleaded implied term (b) (annual notification) whilst sensible, is not a necessary implication in the requisite sense. However, I am persuaded that the second part of that term should be implied. Clause 17 must be construed in a manner that could apply to the supply and install option if chosen. It is clear enough that the clause cannot operate, literally construed, in isolation from the other provisions in relation to that option for reasons already explained. It is obvious that reasonable advance notice must be given of the precise locations, types of pole and accessories in order to make the contract effective. The pleaded term is a sensible application of the general Mackay v Dick obligation of cooperation and, if it be necessary, meets the requirements for implication of a term set out in BP Refinery (Westernport) Pty Ltd v Shire of Hastings [1977] HCA 40 ; (1977) 180 CLR 266 at 283. Such a term would also have appropriate application to a supply contract. Clause 17 applies across the board and I have pointed out the absurdities involved in the literal construction of it proposed on behalf of the Council, even in the case of a supply only contract.