Astley v Austrust Ltd
High Court of Australia
(2000) 197 CLR 1; [1999] HCA 6 (4 March 1999)
Case details
Court
High Court of Australia
Judges
Gleeson CJ
McHugh J
Gummow J
Hayne J
Callinan J
Appeal from
Supreme Court of South Australia (Full Court)
Austrust Ltd v Astley (1996) 67 SASR 207; [1996] SASC 6192 ➤
Judges
Doyle CJ
Olsson J
Duggan J
Trial
Supreme Court of South Australia
Austrust Pty Ltd v Astley (1993) 60 SASR 354 [1993] SASC 4474 ➤
Judge
Mullighan J
Issues
Implied terms
Link to full case
AustLII ➤
Overview
This case revolved around whether or not damages for breach of an implied term to take reasonable care and skill in providing a service should be reduced as a result of contributory negligence.
The majority of the High Court concluded it should not; reduction in damages for contributory negligence is relevant to the assessment of damages in tort and not breach of contract.
Facts
Astley was the senior partner of the firm of solicitors that acted for Austrust (a trustee company). Austrust alleged Astley was negligent in its provision of legal advice. This was accepted, but the trial judge also found that Austrust had been negligent and that both defaults (negligence of both Astley and Austrust) were concurrent and successive causes of the relevant loss.
The Full Court overturned this finding, holding that Astley had not made out a case for contributory negligence by Austrust.
Astley appealed to the High Court.
Issue
Whether duty to take reasonable care should be implied into solicitor/client contract.
Held (High Court)
Gleeson CJ, McHugh, Gummow and Hayne JJ
Their Honours agreed with the trial judge, finding that Austrust was guilty of contributory negligence.
On the issue of concurrent contractual liability, their Honours concluded [at para 47] that an
'implied term of reasonable care in a contract of professional services arises by operation of law. It is one of those terms that the law attaches as an incident of contracts of that class. It is part of the consideration that the promisor pays in return for the express or implied agreement of the promisee to pay for the services of the person giving the promise. Unlike the duty of care arising under the law of tort, the promisee in contract always gives consideration for the implied term. And it is a term that the parties can, and often do, bargain away or limit as they choose.' [footnote omitted]
They concluded that, although Austrust was guilty of contributory negligence, that finding is applicable only to the assessment of damages in tort and not for breach of contract.
Callinan J (dissenting)
Justice Callinan would have allowed the appeal and restored the judgment of the trial judge. His Honour considered that damages should be reduced for contributory negligence:
[para 160] 'once negligence and contributory negligence have to be weighed in the balance, it will not be possible in many cases to say that the injury or damage, absent the contributory negligence, would be exactly the same as it would be as a result of the concurrent negligence of the plaintiff and the defendant.'