Melic Pty Ltd v Lainson [2005] NSWSC 711

Melic Pty Ltd v Lainson [2005] NSWSC 711

The contract, properly construed, specifically contemplated appointment of trustees for sale under s 66G and required completion 21 days after such appointment. Although the s 66G order was a defect in title, the purchaser had contracted to complete despite that defect and was precluded from terminating on that basis. The purchaser's purported termination was wrongful, the vendor was entitled to terminate for non-performance and to damages in principle, and retention of the non-refundable deposit was not unconscionable.

Jurisdiction
Australia
Judgment Date
14 July 2005
Procedural Posture
Equity Proceedings Concerning a Contract for Sale of Land, Purchaser's Claim for Return of Deposit, and Vendor's Cross Claim for Retention of Deposit and Damages for Breach of Contract / Judgment After Hearing; Short Minutes of Order to Be Brought in
Outcome
Purchaser not entitled to terminate or recover the deposit; vendor entitled to terminate for non-performance and to damages in principle, with retained deposit to be allowed against damages assessed.
Legal Topics
['vendor and Purchaser' 'contract Construction' 'parol Evidence and Surrounding Circumstances' 'defect in Title' 'termination for Non Performance' 'recovery or Forfeiture of Deposit' 'conveyancing Act 1919 S 66 G Order for Trustees for Sale' 'conveyancing Act 1919 S 55']
['conveyancing' 'contract Law' 'equity'] ['vendor and Purchaser' 'contract Construction' 'parol Evidence and Surrounding Circumstances' 'defect in Title' 'termination for Non Performance' 'recovery or Forfeiture of Deposit' 'conveyancing Act 1919 S 66 G Order for Trustees for Sale' 'conveyancing Act 1919 S 55']

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Procedural Posture

Equity Proceedings Concerning a Contract for Sale of Land, Purchaser's Claim for Return of Deposit, and Vendor's Cross Claim for Retention of Deposit and Damages for Breach of Contract / Judgment After Hearing; Short Minutes of Order to Be Brought in

Legal Issues

  1. 1 ['Did the contract on its true construction require the purchaser to complete the contract although trustees for sale had been appointed?' 'Was the appointment of trustees for sale a defect in title which entitled the purchaser to terminate the contract?' "Was the vendor entitled to terminate the contract for the purchaser's non performance?" 'Is the purchaser entitled to a return of the deposit under s 55(1) of the Conveyancing Act 1919 or alternatively should it have an order for the return of the deposit under s 55(2A)?' 'Is the vendor entitled to damages for breach of contract?']

Ratio Decidendi

The contract, properly construed, specifically contemplated appointment of trustees for sale under s 66G and required completion 21 days after such appointment. Although the s 66G order was a defect in title, the purchaser had contracted to complete despite that defect and was precluded from terminating on that basis. The purchaser's purported termination was wrongful, the vendor was entitled to terminate for non-performance and to damages in principle, and retention of the non-refundable deposit was not unconscionable.

Court Disposition

Purchaser not entitled to terminate or recover the deposit; vendor entitled to terminate for non-performance and to damages in principle, with retained deposit to be allowed against damages assessed.

Orders

  • ['Return of deposit refused.' 'Vendor entitled to retain the deposit, subject to its allowance against any damages assessed.' 'Short minutes of order to be brought in; quantum of damages and costs may be raised then.']