Abandonment (in the context of contracts)

Abandonment in the context of law is the relinquishment of a legal claim or interest, with the intention of never reclaiming it.

Abandonment will only be taken to have occurred where it is bipartite; i.e. where both parties have mutually abandoned the contract. In situations where one party abandons a contract, the other may have a claim against them for breach.

Abandonment in the specific context of contract law, was referred to by the High Court of Australia in DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423 (DTR Nominees) and more recently by the NSW Court of Appeal in Ryder v Frohlich [2004] NSWCA 472 (Ryder).

Justice McColl in Ryder referred to Stephen, Mason and Jacobs JJ in DTR Nominees, and stated that the abandonment of a contract will be inferred where it is plain from the conduct of the parties that they have abandoned the contract (including their obligations and rights), and it can be objectively assessed as a matter of fact, that neither party intended that the contract should be further performed.

She further went on to state, referring to Dixon CJ and Fullagar J in Fitzgerald v Masters (1956) 95 CLR 420, that an inference of abandonment will be drawn where “an ‘inordinate’ length of time has been allowed to elapse, during which neither party has attempted to perform, or called upon the other to  perform a contract made between them”.