DPG Project 33 Pty Ltd & Anor v Aqualand Chatswood 3 Pty Ltd & Anor [2020] NSWSC 1663

DPG Project 33 Pty Ltd & Anor v Aqualand Chatswood 3 Pty Ltd & Anor [2020] NSWSC 1663

Reading clauses 2 and 3 together, the Deed was rescinded at 5.00pm on 2 November 2020, not on 23 October 2020. The Developer served the Notice at 4.42pm on 2 November 2020 within the time specified in clause 8.3. Clause 8 did not make exercise of the option conditional on service of a Notice of Intention. By clause 8, DPG had already expressed an intention that, upon exercise of the option, it would assign the Option Rights immediately. Service of the Notice therefore exercised the option and effected an equitable assignment of the Option Rights to the second defendant before rescission of the Deed.

Jurisdiction
Australia
Judgment Date
23 November 2020
Procedural Posture
Equity Technology and Construction List; Contracts Construction Proceedings Concerning the Proper Construction of an Option Holder Deed / Principal Judgment After Urgent Hearing on 20 November 2020
Outcome
The first defendant's election notice was effective to cause the plaintiffs' options to be assigned to the second defendant.
Legal Topics
['construction of Commercial Contracts' 'option Holder Deed' 'election Notice' 'equitable Assignment of Option Rights' 'rescission and Expiry of Deed']
['contracts' 'equity' 'property Law'] ['construction of Commercial Contracts' 'option Holder Deed' 'election Notice' 'equitable Assignment of Option Rights' 'rescission and Expiry of Deed']

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Procedural Posture

Equity Technology and Construction List; Contracts Construction Proceedings Concerning the Proper Construction of an Option Holder Deed / Principal Judgment After Urgent Hearing on 20 November 2020

Legal Issues

  1. 1 ['Whether the Deed had expired or been rescinded before 4.42pm on 2 November 2020.' 'Whether the Developer was entitled to exercise the clause 8 option without having served a Notice of Intention.' "Whether the Notice of Exercise of Option was effective to cause an equitable assignment of the plaintiffs' Option Rights to the second defendant."]

Ratio Decidendi

Reading clauses 2 and 3 together, the Deed was rescinded at 5.00pm on 2 November 2020, not on 23 October 2020. The Developer served the Notice at 4.42pm on 2 November 2020 within the time specified in clause 8.3. Clause 8 did not make exercise of the option conditional on service of a Notice of Intention. By clause 8, DPG had already expressed an intention that, upon exercise of the option, it would assign the Option Rights immediately. Service of the Notice therefore exercised the option and effected an equitable assignment of the Option Rights to the second defendant before rescission of the Deed.

Court Disposition

The first defendant's election notice was effective to cause the plaintiffs' options to be assigned to the second defendant.

Orders

  • ['By the Notice of Exercise of Option dated 2 November 2020, executed by the defendants and sent to the plaintiffs at 4.42pm on 2 November 2020, the plaintiffs assigned the Option Rights (as that term is defined in the Option Holder Deed dated 12 December 2018 made between the plaintiffs and the first defendant) to...