Schwartz v Hadid [2013] NSWCA 89

Schwartz v Hadid [2013] NSWCA 89

The Court (Macfarlan and Meagher JJA, Basten JA dissenting) held the Deed of Agreement did not impose a contractual obligation on Dr Schwartz to purchase or option the remaining properties (C and D), as its language only conferred discretion to purchase one or more and no binding obligation arose from extrinsic materials. The alleged oral variation to the loan agreement was unenforceable for want of consideration, as Mr Hadid promised only what he was already obligated to do and no practical benefit was conferred on Dr Schwartz.

Parties
Appellant/cross Respondent: Jerry Schwartz; Respondent/cross Appellant: Albert Hadid
Jurisdiction
Australia
Judgment Date
03 May 2013
Procedural Posture
Appeal and Cross Appeal From Judgment of Supreme Court of New South Wales / Court of Appeal Judgment
Outcome
Dr Schwartz's appeal in the Joint Venture Proceedings was allowed, setting aside the judgment against him, and judgment entered in his favour. Mr Hadid's cross-appeal in the Loan Proceedings was dismissed with costs.
Legal Topics
Construction and Interpretation of Contracts, Use of Extrinsic Evidence, Enforceability and Certainty of Contractual Terms, Consideration and Contractual Variation, Joint Ventures
Contract Law Construction and Interpretation of Contracts Use of Extrinsic Evidence Enforceability and Certainty of Contractual Terms Consideration and Contractual Variation Joint Ventures

Case Brief

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Parties

Jerry Schwartz

Appellant/cross Respondent

Albert Hadid

Respondent/cross Appellant

Procedural Posture

Appeal and Cross Appeal From Judgment of Supreme Court of New South Wales / Court of Appeal Judgment

Legal Issues

  1. 1 Whether the Deed of Agreement imposed a binding contractual obligation on Dr Schwartz to purchase or option properties C and D as part of a joint venture with Mr Hadid.
  2. 2 Whether extrinsic evidence including prior negotiations and proposals could be used to interpret the Deed of Agreement.
  3. 3 Whether the alleged oral variation to the loan agreement concerning repayment was supported by consideration and therefore enforceable.

Ratio Decidendi

The Court (Macfarlan and Meagher JJA, Basten JA dissenting) held the Deed of Agreement did not impose a contractual obligation on Dr Schwartz to purchase or option the remaining properties (C and D), as its language only conferred discretion to purchase one or more and no binding obligation arose from extrinsic materials. The alleged oral variation to the loan agreement was unenforceable for want of consideration, as Mr Hadid promised only what he was already obligated to do and no practical benefit was conferred on Dr Schwartz.

Court Disposition

Dr Schwartz's appeal in the Joint Venture Proceedings was allowed, setting aside the judgment against him, and judgment entered in his favour. Mr Hadid's cross-appeal in the Loan Proceedings was dismissed with costs.

Orders

  • Grant Dr Schwartz leave to appeal.
  • Direct that the Notice of Appeal filed by him on 28 November 2011 stand as his Notice of Appeal.