Wollongong City Council’s legal and risk manager, a Mr Williams, instructed the council’s longtime solicitor to draw up lease documentation. It was originally proposed that the rent the council was to receive was to be calculated based on the value of both the landlord’s and the tenant’s fittings and fixtures, but it was later decided that those of the tenant would be excluded. Peedom, the solicitor, inserted a preamble stating that ‘for the removal of doubt the value of the following fixtures and fittings are [sic] to be ignored’, with a list of the tenant’s items. That list ended with the word ‘and’. On the next page, which the solicitor clearly neglected to look at, began with a listing of the landlord’s fixtures and fittings, which were by virtue of that ‘and’ also excluded from the rent calculation – in spite of the specific instruction that they were to be included. The council sued: The Stuart Park (D580060) Reserve Trust v Peedoms Lawyers Pty Ltd,  NSWSC 1133.
Grove AJ of the New South Wales Supreme Court found that Peedom had been negligent. This was not a case of mere inadvertence, as the change in drafting instructions on the rental calculation clearly ‘demanded express focus’ on the particular clause. Peedom’s correspondence with the council routinely included a request for approval of his drafts, but the evidence showed that Williams had not reviewed the draft lease. Because the clarity of the instructions required Peedom’s ‘precise focus’ on the rent provisions, Williams’s contributory negligence reduced Peedom’s liability only by 25%. The council still obtained judgment for AUS$1.1 million plus costs and interest, although it failed to recoup the costs of a rectification action they had brought against the defendant, which was an unreasonable step on their part in the circumstances.
[Link available here].