VIC Breach of Terms of Settlement?

[Rod]

Hi guys,

Someone is paying money under a binding Terms of Settlement. The Terms of Settlement (TOS) state the money is to be '.... paid on the first day of each month'. There's still a year or so left to run on the TOS.

The person paying the money claims she set up an auto payment on the last day of the month. This means that when the last day is a Friday or weekend, the payment sometimes doesn't land into the receiving party's account until the 2nd or 3rd of the month.

Is this a breach of contract?
Can she be taken to court by the other party for breach of contract?
Is a court likely to order payments to be made as per the agreement?
Would court likely order the offending party to pay costs?

There is no goodwill on either side due to the background leading up to the settlement.

Thoughts/opinions?

 

[Tracy B]

Hi Rod,

I'm not too sure about your situation, however, in most contracts, there are express provisions that state if the date for payment lands on a weekend or public holiday, then it is the next business day. If this is not stated in the settlement agreement, perhaps it could be implied into the contract.

It will also depend on how courts interpret the term "paid on". It could mean (i) the act of paying; or (ii) actual receipt of payment. Unless there is further assistance in the settlement agreement or negotiations, I believe it would generally mean the former. In most contracts I have come across, the obligation is discharged when the payer transfers on said date, rather than when the receiver receives the money as the risk generally passes with the act of paying.

 

[Rod]

Ok, thanks for that reply.