HYUNDAI ELEVATOR CO LTD v LIFTRONIC PTY LTD and ORS; HYUNDAI CORPORATION and ANOR v LIFTRONIC PTY LTD [1994] NSWCA 144

HYUNDAI ELEVATOR CO LTD v LIFTRONIC PTY LTD and ORS; HYUNDAI CORPORATION and ANOR v LIFTRONIC PTY LTD [1994] NSWCA 144

Representations made by Hyundai Australia Pty Ltd in July and September 1986 were not promissory in nature or, if promissory, any offer had lapsed before the first purchase contract in April 1988, precluding the existence of a collateral contract. In determining damages for loss of profits, insufficient allowance was made for the effects of the recession; the proper figure was 35% reduction, not 25%, effectively reducing the damages awarded to Liftronic. The claim for Mr Kong's wages was properly allowed based on the evidence that his employment was necessitated by Hyundai lift defects.

Parties
Appellant: Hyundai Elevator Co Ltd; Appellant: Hyundai Corporation; Appellant: Hyundai Australia Pty Ltd; Respondent: Liftronic Pty Ltd
Jurisdiction
Australia
Judgment Date
09 December 1994
Procedural Posture
Appeal / Judgment Court of Appeal
Outcome
Appeal by Hyundai Australia Pty Ltd allowed; appeals by Hyundai Elevator Co Ltd and Hyundai Corporation allowed in part.
Legal Topics
Collateral Contract, Breach of Contract, Damages, Misrepresentation, Trade Practices Act
Contract Law Collateral Contract Breach of Contract Damages Misrepresentation Trade Practices Act

Case Brief

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Parties

Hyundai Elevator Co Ltd

Appellant

Hyundai Corporation

Appellant

Hyundai Australia Pty Ltd

Appellant

Liftronic Pty Ltd

Respondent

Procedural Posture

Appeal / Judgment Court of Appeal

Legal Issues

  1. 1 Whether collateral contracts arose from representations made by Hyundai Australia Pty Ltd to Liftronic Pty Ltd in 1986 when the purchase contracts were concluded in 1988.
  2. 2 Whether damages for loss of profits were correctly calculated, including the effect of the economic recession on the lift market.
  3. 3 Whether the trial judge erred in allowing the claim for the wages of Mr Kong.

Ratio Decidendi

Representations made by Hyundai Australia Pty Ltd in July and September 1986 were not promissory in nature or, if promissory, any offer had lapsed before the first purchase contract in April 1988, precluding the existence of a collateral contract. In determining damages for loss of profits, insufficient allowance was made for the effects of the recession; the proper figure was 35% reduction, not 25%, effectively reducing the damages awarded to Liftronic. The claim for Mr Kong's wages was properly allowed based on the evidence that his employment was necessitated by Hyundai lift defects.

Court Disposition

Appeal by Hyundai Australia Pty Ltd allowed; appeals by Hyundai Elevator Co Ltd and Hyundai Corporation allowed in part.

Orders

  • Judgment in favour of Liftronic against Hyundai Australia Pty Ltd set aside and judgment entered for Hyundai Australia Pty Ltd.
  • Judgments against Hyundai Elevator Co Ltd and Hyundai Corporation varied: damages for loss of profits and interest reduced from $3,670,000 to $2,238,063 for loss of profits with effect from 1 September 1993; interest to be determined.