Futuris Industrial Products P/L v. Arrow Industries P/L & Anor [1994] FCA 967

Futuris Industrial Products P/L v. Arrow Industries P/L & Anor [1994] FCA 967

Futuris breached the exclusive marketing agreement by supplying the same brake pad formulation to the general market, thus damaging Arrow's sales potential. Damages based on lost sales were assessed by reference to realistic growth projections, gross margin, overheads, additional reasonable expenses, unsold stock...

Source-derived case information.

Parties
Applicant: Futuris Industrial Products Pty Ltd; First Respondent, Cross Claimant: Arrow Industries Pty Ltd; Second Respondent, Cross Respondent: Terry Conroy
Jurisdiction
Australia
Judgment Date
13 December 1994
Procedural Posture
General Division Contract/damages / Judgment After Rehearing on Damages Following Full Court Remittal
Outcome
Judgment for the first respondent against the applicant.
Legal Topics
Damages, Breach of Exclusive Marketing Agreement, Breach of Contract, Supply of Goods
Contract Law Damages Breach of Exclusive Marketing Agreement Breach of Contract Supply of Goods

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Parties

Futuris Industrial Products Pty Ltd

Applicant

Arrow Industries Pty Ltd

First Respondent, Cross Claimant

Terry Conroy

Second Respondent, Cross Respondent

Procedural Posture

General Division Contract/damages / Judgment After Rehearing on Damages Following Full Court Remittal

Legal Issues

  1. 1 Whether Futuris breached its exclusive marketing agreement with Arrow regarding supply and marketing of brake pads (formulation 3410F)
  2. 2 Calculation of damages suffered by Arrow resulting from breach of exclusivity and quality of supplied goods

Ratio Decidendi

Futuris breached the exclusive marketing agreement by supplying the same brake pad formulation to the general market, thus damaging Arrow's sales potential. Damages based on lost sales were assessed by reference to realistic growth projections, gross margin, overheads, additional reasonable expenses, unsold stock and returned stock, and interest to judgment. Arrow’s claim for further damages for loss of reputation and quality defects was not specifically proved or formulated in monetary terms, and damages were limited to losses demonstrably caused by Futuris’s breach within the period for which exclusivity should have lasted.

Court Disposition

Judgment for the first respondent against the applicant.

Orders

  • There be judgment for the respondents against the applicant in the sum of $354,583.80.
  • Costs be reserved.