I Cook Foods Pty Ltd v City of Whitehorse

I Cook Foods Pty Ltd v City of Whitehorse [2026] FCA 155 is a Federal Court decision about whether a lawsuit should be stopped early, not about who ultimately wins the underlying dispute. The City of Whitehorse asked the Court to summarily dismiss I Cook Foods’ claims, arguing they had no reasonable prospect of success. Anderson J refused that application.

The case arose from the breakdown of a Meals on Wheels supply arrangement after a precautionary food withdrawal in February 2019, a closure order affecting I Cook Foods’ production, and the Council’s later termination of the contract. I Cook Foods then sued, alleging wrongful repudiation of contract and unconscionable conduct under the Australian Consumer Law. The Court held that the dispute raised substantial factual disputes and mixed questions of fact and law that should be decided at trial.

The commercial relationship was a supply arrangement for an essential community service. Until 2023, the Council provided a Meals on Wheels service to residents in its municipality, including vulnerable residents, older adults and people living with disability. From 2015 to April 2019, I Cook Foods was engaged as the sole supplier of meals under the contract. The judgment states that the contract had an initial three-year term and was then extended for one year.

The contract did more than set out delivery obligations. It imposed detailed compliance obligations tied to food law and other legal requirements. It also imposed business continuity obligations. Those clauses required documented arrangements to protect the Council from business interruption, a business continuity plan to ensure ongoing meal provision in an emergency, and contingency arrangements to ensure continuity of supply. If I Cook Foods could not supply meals itself, it had to ensure delivery of an equivalent product meeting quantity, quality, dietary and nutritional requirements at its own expense.

On 22 February 2019, the Council received a notification from the Department of Health and Human Services about a precautionary food withdrawal involving food produced by I Cook Foods because of suspected listeria contamination. The notification advised the Council to discard food supplied on or before 21 February 2019 and referred to the risk of serious illness, including death, in vulnerable groups. The Department also requested the City of Greater Dandenong to issue I Cook Foods with an order under the Food Act requiring it to cease production.

The Council then carried out its own sampling and environmental swabbing at a distribution centre and arranged laboratory testing. One sample returned a positive result for Listeria monocytogenes. The Council also cleaned the distribution centres in line with listeria guidelines. From 22 February 2019, I Cook Foods ceased supplying meals.

That interruption triggered the contract’s continuity obligations. The Council said I Cook Foods failed to procure alternative supply or deliver an equivalent product. I Cook Foods said the Council prevented the business continuity plan from operating and made its own supply arrangements without working with I Cook Foods. On 27 February 2019, I Cook Foods wrote to the Council suggesting Chef Good as a possible supplier. When contacted, Chef Good said it could not meet the Council’s volume requirements.

On either 28 or 29 March 2019, the Council served a default notice alleging two defaults: failure to comply with the compliance obligations and failure to comply with the business continuity obligations. The notice required the defaults to be remedied within seven days and warned of termination. Later that same day, the Council was advised that the closure order had been revoked. Even so, I Cook Foods did not respond to the default notice and did not recommence supply, whether directly or through a third-party supplier. On 10 April 2019, the Council terminated the contract. In March 2025, nearly six years later, I Cook Foods commenced proceedings.

The legal issue before the Court was narrow but commercially important. The Council applied for summary judgment under section 31A of the Federal Court of Australia Act 1976 (Cth) and rule 26.01 of the Federal Court Rules 2011 (Cth). To succeed, the Council had to show that I Cook Foods had no reasonable prospect of successfully prosecuting its claims.

The Court approached that question using established summary judgment principles. Those principles require caution. The Court does not conduct a full trial on an interlocutory application. It asks whether there are real issues of fact or law requiring proper determination at trial, rather than fanciful issues. Courts are especially reluctant to summarily dismiss proceedings where there are significant factual disputes, issues of witness credit, technical matters or mixed questions of fact and law.

I Cook Foods had brought two claims. First, it alleged that the Council wrongfully repudiated the contract by relying on an invalid termination notice. Secondly, it alleged that the Council engaged in unconscionable conduct in connection with the supply of goods or services, contrary to section 21 of Schedule 2 to the Competition and Consumer Act 2010 (Cth), by relying on the Council’s testing to terminate the contract.

The Court did not need to decide whether those claims would ultimately succeed. It only needed to decide whether they were so lacking in merit that they should be stopped immediately. That distinction matters. A party can lose a summary judgment application even if it later wins at trial, because the threshold for shutting down a case early is high.

Anderson J dismissed the Council’s application. The Court held that the affidavit material revealed substantial factual and legal disputes between the parties that could not be resolved summarily. The judgment repeatedly emphasised that these were not minor or artificial disputes. Some were technical. Some depended on competing witness accounts. Some involved mixed questions of fact and law.

On the contract claim, the Court considered arguments about whether the default notice was defective, whether the alleged defaults were properly particularised, whether the Council could rely on continuing non-compliance with compliance obligations and business continuity obligations, and whether the Council’s conduct prevented the business continuity plan from operating. The Court rejected one specific complaint that the default notice lacked particularisation because the notice expressly referred to the tender schedule and the items relied on. But that did not end the matter. The broader disputes about the notice, the alleged defaults and the parties’ conduct remained substantial and contested.

The Court also dealt with the unconscionable conduct claim. I Cook Foods alleged that the Council exercised regulatory and investigatory powers in a sub-standard or sub-legal manner and relied on testing to terminate the contract. The Council denied that it had the statutory powers alleged and argued that the relevant authority was the City of Greater Dandenong, not the Council. The Court did not resolve that dispute. It held that these factual and legal issues were unsuitable for summary determination and should be dealt with at trial where the evidence could be tested through cross-examination.

The result was procedural but still important. The proceeding was not dismissed. The Council’s application failed, and the Council was ordered to pay I Cook Foods’ costs of the application on a lump sum basis to be agreed or assessed. The substantive claims remain unresolved.

The judgment shows how quickly operational documents can become central evidence in a commercial dispute. The contract itself mattered because it contained detailed compliance clauses, continuity obligations and a default-and-termination mechanism. The default notice mattered because the Council relied on it as the contractual step before termination. The closure order and its later revocation mattered because they affected the parties’ arguments about whether I Cook Foods remained unable to perform. The Council’s testing mattered because it sat at the centre of the unconscionable conduct claim.

The parties’ conduct also mattered. The Council said I Cook Foods stopped supply on 22 February 2019 and did not ensure equivalent substitute supply. I Cook Foods said the Council made its own arrangements without working with it and prevented the business continuity plan from operating. The Court noted evidence from Mr Cook that the business continuity plan was available and able to be performed, that Chef Good and Choice Fresh Meals were identified as interim suppliers, and that the Council did not engage with I Cook Foods about activating the plan. Those competing accounts were a major reason the case could not be decided summarily.

For businesses, the practical point is straightforward. If your contract requires continuity of supply, you should be able to prove not only that you had a plan, but also what steps were taken to activate it, who was contacted, whether substitute suppliers could actually perform, what the customer was told, and whether the customer cooperated or refused to cooperate. If you are the customer, you should be able to show why your notices were issued, what defaults were said to exist, what remedy period was given, and what happened during that period.

In a later dispute, courts often focus less on broad assertions and more on contemporaneous documents: notices, emails, test reports, regulator communications, internal logs, supplier confirmations and records of meetings or attempted meetings. This case is a good example of that dynamic.

Businesses should not read this case as saying that I Cook Foods was right on the merits. The Court did not decide that. Nor should customers read it as saying that a default notice and termination will always be upheld if continuity of supply fails. The real point is procedural and practical: where a dispute involves contested events, technical evidence and competing explanations for a supply failure, a court may insist on a trial.

If you are a supplier, this case is a reminder that continuity clauses can impose real operational obligations. A business continuity plan should not be a generic document prepared for tender purposes and then forgotten. It should identify actual substitute capacity, communication pathways, decision-makers, timing, quality controls and cost responsibility. If an incident occurs, you need evidence showing what you did and what you were still able to do.

If you are a customer, especially one delivering an essential service, this case shows the value of careful notice drafting and disciplined evidence gathering. A default notice should identify the contractual obligations said to be breached and the conduct said to constitute the breach. If you later terminate, you should be able to show that the defaults were not remedied within the required period and that your decision was grounded in the contract and the facts as they stood at the time.

The case also shows the limits of early procedural attacks. Summary judgment can be useful where a claim is truly hopeless, but it is not a substitute for trial where the dispute depends on witness evidence, technical testing issues or mixed questions of fact and law. Businesses considering such an application should weigh the cost and strategic value carefully.

The judgment was delivered on 26 February 2026 by Anderson J in the Federal Court of Australia. It concerns an interlocutory application filed by the Council on 5 August 2025 seeking summary dismissal of I Cook Foods’ claims. The hearing took place on 19 February 2026.

The Court dismissed the application and ordered the Council to pay I Cook Foods’ costs of the application. The broader proceeding remains on foot. That means the contract claim and the ACL claim still await final determination. Readers should therefore treat the judgment as a procedural ruling about whether the case can continue, not as a final ruling on liability.