Dasreef Developments Pty Ltd v Josiv Velkovski [2017] NSWSC 1698

Dasreef Developments Pty Ltd v Josiv Velkovski [2017] NSWSC 1698

The Purchaser failed to comply with the notice to complete and was not in a position to complete because finance was not available. Although the Vendors suffered no loss and resold the Unit for a higher price, and although the loss of the deposit was a significant detriment to the Purchaser, the Purchaser did not inform the Vendors of any firm proposals for finance and did not establish a relevant misunderstanding about the Unit. It was therefore not unjust or inequitable as between the Vendors and the Purchaser for the Vendors to retain the deposit, and the discretion under s 55(2A) should not be exercised in the Purchaser's favour.

Jurisdiction
Australia
Judgment Date
08 December 2017
Procedural Posture
Conveyancing Proceedings Concerning Forfeiture of a Deposit Under a Contract for Sale of Land and Relief Under S 55(2 A) of the Conveyancing Act 1919 (nsw) / Principal Judgment After Hearing
Outcome
The deposit was declared forfeited to the plaintiffs; the summons was otherwise dismissed; the cross-claim was dismissed; and the first defendant was ordered to pay the plaintiffs' costs on the ordinary basis.
Legal Topics
['breach of Contract for Sale of Land' 'notice to Complete' 'termination of Contract' 'forfeiture of Deposit' 'relief Against Forfeiture of Deposit Under S 55(2 A)']
['conveyancing' 'contract Law' 'equity'] ['breach of Contract for Sale of Land' 'notice to Complete' 'termination of Contract' 'forfeiture of Deposit' 'relief Against Forfeiture of Deposit Under S 55(2 A)']

Case Brief

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Procedural Posture

Conveyancing Proceedings Concerning Forfeiture of a Deposit Under a Contract for Sale of Land and Relief Under S 55(2 A) of the Conveyancing Act 1919 (nsw) / Principal Judgment After Hearing

Legal Issues

  1. 1 ['Whether the Court should order repayment of the deposit to the Purchaser under s 55(2A) of the Conveyancing Act 1919 (NSW).' 'Whether it would be unjust or inequitable as between the Vendors and the Purchaser for the Vendors to retain the forfeited deposit.' "Whether the Purchaser's alleged misunderstanding about the identification of the Unit was established and relevant to the exercise of discretion."]

Ratio Decidendi

The Purchaser failed to comply with the notice to complete and was not in a position to complete because finance was not available. Although the Vendors suffered no loss and resold the Unit for a higher price, and although the loss of the deposit was a significant detriment to the Purchaser, the Purchaser did not inform the Vendors of any firm proposals for finance and did not establish a relevant misunderstanding about the Unit. It was therefore not unjust or inequitable as between the Vendors and the Purchaser for the Vendors to retain the deposit, and the discretion under s 55(2A) should not be exercised in the Purchaser's favour.

Court Disposition

The deposit was declared forfeited to the plaintiffs; the summons was otherwise dismissed; the cross-claim was dismissed; and the first defendant was ordered to pay the plaintiffs' costs on the ordinary basis.

Orders

  • ['Declare that the deposit paid by the first defendant to the second defendant, as stakeholder, has been forfeited to the plaintiffs.' 'Summons be otherwise dismissed.' 'Cross-Claim be dismissed.' "First defendant to pay the plaintiffs' costs of the summons and cross-claim on the ordinary basis."]