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ARTICLE · 05 JUNE 2008

Environmental Systems Pty Ltd -v- Peerless Holdings Pty Ltd [2008] VSCA 26

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The importance of exclusion clauses as they relate to "consequential loss" has been reinforced by the recent decision of the Victorian Court of Appeal in Environmental Systems Pty Ltd -v- Peerless Holdings Pty Ltd [2008] VSCA 26.

AustraliaReal Estate and Construction
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Peter Lamont - Solicitor

The importance of exclusion clauses as they relate to "consequential loss" has been reinforced by the recent decision of the Victorian Court of Appeal in Environmental Systems Pty Ltd -v- Peerless Holdings Pty Ltd [2008] VSCA 26. The question for organisations to consider is whether or not existing contractual frameworks adequately define consequential loss.

The facts

Environmental Systems entered into a contract with Peerless Holdings to provide Peerless with a regenerative thermal oxidiser (RTO). The RTO did not perform as specified under the agreement and Peerless had to obtain a replacement.

Peerless brought proceedings against Environmental Systems for the following:

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