Case name & citation: Sydney City Council v West (1965) 114 CLR 481
The concerned Court: High Court of Australia
Decided on: 16 December 1965
Area of law: Exclusion of liability; four corners rule
What is the case about?
Sydney City Council v West (1965) is an Australian contract law case on the issue of exclusion clauses.
Facts of the case
West takes his car to the parking lot of the Sydney City Council and parks it there. He was issued a ticket that instructed him to present this ticket in order to regain possession of the vehicle. In addition, an exclusion clause on the ticket protected the parking lot from liability for any loss, regardless of how the loss/damage/injury may occur or be caused. West returned to pick up his car, but it had been stolen; a thief had broken into the car and driven it down to the checkout area. The operator had let the thief go on his being claiming that he had lost the parking ticket. Thus, the plaintiff brought an action against the Sydney City Council to claim damages. But the Council denied liability on the grounds of the exclusion clause on the ticket.
Could the liability of the Council be excluded in these circumstances?
Judgment of the Court in Sydney City Council v West
The Court held that the exclusion clause could not be applied in this case and the Council could not rely on it when the plaintiff’s car was stolen from the car park.
It was held that a clause that excludes liability can only do so if the act from which it is seeking to exclude liability falls within the parameters of the contract.
The clause gave protection (for acts of negligence) only in the performance of the contract: it could not have been intended to protect the Council from “negligence on the part of the Council’s servants in doing something which it is neither authorized nor permitted to do by the terms of the contract”.
The release of the vehicle was not merely negligent; it was also a delivery outside the terms of the contract. The act of the attendant at the exit area to allow the thief to take the car without checking was not something that was authorized. And enforcing the exclusion clause might seem to have produced injustice.
Therefore, as a result of the fact that the circumstances fell outside of the scope of what the clause was supposed to cover, it was determined that the clause did not apply.
The main principle from the case of Sydney City Council v West
Four corners rule
The act for which you are attempting to exclude your liability must be authorized or contemplated by the contract within the four corners of the contract in order for you to be able to do so.
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