In the matter of Roehlen v. Mikhail [2018] VSC 121 the Supreme Court upheld an appeal by Benjamin Roehlen and his hire car provider Right2Drive and remitted the case back to the Magistrates’ Court for determination. The Magistrates’ Court had earlier found that the rental contract between Mr Roehlen and Right2Drive was void for uncertainty. On the basis that the contract was void, the sitting Magistrate then found that the appellant had not suffered a compensable loss, and could therefore not recover the hire car charges from the respondent.

Note: Mills Oakley represented the respondent in these proceedings.

In Roehlen v. Mikhail [2018] VSC 121 Justice Forrest of the Supreme Court found that the Magistrate ought to have considered whether the agreement between the appellant and Right2Drive evinced an intention by both parties to enter into a contract. His Honour did not find that it was not open for the Magistrate to conclude that the contract was void for uncertainty. Rather, his Honour concluded that the Magistrate did not give proper consideration to the relevant question of uncertainty.

His Honour then proceeded to discuss the hypothetical question of whether the appellant suffers a compensable loss in circumstances where the contract with Right2Drive is indeed void. His Honour opined that there is a clear divergence between English case law and Australian case law. In England, the rental car charges are extinguished and unrecoverable should the rental agreement fail. In Australia, the rental car charges remain recoverable at the ‘market rate’ despite the agreement failing. His Honour’s view was that had the contract between the appellant and Right2Drive failed, then the appellant had still suffered a compensable loss. Interestingly, his Honour stated that there is ‘practical merit’ in the real world approach adopted in the English case law.

His Honour ordered that the case be remitted back to the Magistrates’ Court for determination of whether the contract was void and if so, whether the appellant had not suffered a compensable loss, and could therefore not recover the hire car charges from the respondent.

The full case can be accessed here.