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Australian Contract Law

According to Australian Contract Law (ACL), in cases where only one party is aware of the matter and the other party depends on him, there is no condition precedent. Thus, the party who guarantees existence of the matter which does not exist actually has breached the contract. In this case, the court’s judgment was in favor of McRae (plaintiff) against Commonwealth Disposals Commission, who was charged for damages for deceit.

As per ACL, a promise for giving something in future, in return for something, such as favor, which has been offered in the past, is not considered as a contract as the person offering favor is not receiving anything at present and there is no consideration and the person giving promise is not legally bound to keep his promise.

When both parties involving in a contract are unknown of the nonexistence of the subject matter, is considered as ‘res extincta’situation. Under such cases the contract is declared void since there is nothing to be contracted upon..In this case the contract was declared void as per ACL based on common mistake believing existence of a matter while contracting, which actually does not.

In cases of non est. factum, as per Saunders v Anglia Building Society, applied in Petelin v Cullen, specifies strict requirements for declaring a plea to be successful under non est. factum, where person committing mistake is either illiterate, blind or suffer some other disability. Therefore, a person is bound to exercise the document he signed, though mistakenly without reading or understanding, other than the causes mentioned above (exceptions applicable).Moreover, it considers the fact that the person pleading non est. factum must qualify the fact that he was not negligent or too lazy to read the document.