Council of the Upper Hunter County District
v Australian Chilling & Freezing Co Ltd
(1967) 118 CLR 429
Facts
Council entered into a contract to supply ACF with electricity. Clause 5 stated "if the Supplier's costs shall vary in other respects than has been hereinbefore provided the Supplier shall have the right to vary the maximum demand charge and energy charge ...". Council sought to increase its charges, but ACF alleged the clause was void for uncertainty, placing reliance on the term ‘supplier’s costs’. The NSW SC agreed and the Council appealed.
Held
Barwick CJ: Noted that a contract is not automatically void for uncertainty just because it may be construed in more than one way: ‘As long as it is capable of a meaning, it will ultimately bear that meaning which the courts, or in an appropriate case, an arbitrator, decides is its proper construction: and the court or arbitrator will decide its application. The question becomes one of construction, of ascertaining the intention of the parties, and of applying it.' He observed that a ‘narrow or pedantic approach’ to interpretation should not be taken - it is clear that Australian courts will be slow to find an agreement void for uncertainty. In this cae there was no uncertainty even though there may be scope for disagreement about what constitued suppliers costs in individual cases.
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