Tallerman & Co Pty Ltd v Nathan's Merchandise (Vic) Pty Ltd (1957)

Tallerman & Co Pty Ltd v Nathan's Merchandise (Vic) Pty Ltd (1957)

PART I

Summary of Facts

The dispute occurred in Victoria between a registered company, Tallerman & Co Pty Ltd ("the plaintiff") and an incorporated company, Nathan's Merchandise Pty Ltd. ("the defendant), where both parties operated their business. Two previous binding contracts (orders No. 58 and No. M57) were made in communications on 14th May 1951 and 2nd August 1951 respectively, each for the sale by the plaintiff to the defendant of 1,000,000 Hungarian .22 bullets. A consignment of 1,800,000 bullets for the above orders was dispatched from Sydney to the defendant by rail on the 12th February 1952 and was received by a carrier employed by the defendant in Melbourne who stored the bullets in the defendant's warehouse, where they resided for three days. Claiming that under the contractual terms, those bullets should only be delivered when requested, the defendant refused to take the delivery, and thus reconsigned the bullets back to Sydney by rail. On 3rd March 1952 a letter by the plaintiff's solicitor was sent out requiring the defendant to accept the "contractual goods" and that otherwise necessary steps would be taken to enforce the plaintiff's legal rights. On 6th March the defendant's solicitors responded by reasserting the stance that it had been settled from the start that delivery of bullets should be made only when the defendant required them, to fulfill its customers' orders. In addition the defendant's solicitors raised the further point that the location of delivery in Melbourne was inconsistent with the contractual terms.

However in correspondence of 21st March1952 the defendant instigated an alteration to the legal position of both parties, by offering to commence "without prejudice" the delivery instruction covering the balance of bullets, provided that the final delivery would not be made later than 30th September 1952. The plaintiff first repudiated this offer on the 3rd April, but by the 4th of June 1952, a second critical letter was sent out by the plaintiff's solicitor stating its acceptance of the defendant's offer. On 8th July 1952, the defendant propose that it will only purchase 800,000 bullets as opposed to the contracted amount of 1,800,000(less 200,000 which had been delivered and paid) as the contract on the 2nd August had not been accepted by the plaintiff which denied it. And no delivery instructions were given by the defendant on or before the 30th September.