Champion Homes Sales Pty Ltd v Biggs; Biggs v Champion Homes Sales Pty Ltd [2023] NSWCATCD 117

Champion Homes Sales Pty Ltd v Biggs; Biggs v Champion Homes Sales Pty Ltd [2023] NSWCATCD 117

The homeowners were not entitled to terminate the contract; their termination was a wrongful repudiation. Champion Homes was entitled to accept the repudiation and terminate the contract. The agreed damages clause of 15% was not a penalty and was enforceable under the contract. Champion Homes was entitled to $61,595.60 (15% agreed damages plus certain development fees minus deposit).

Parties
Applicant: Champion Homes Sales Pty Ltd; Respondent: Darren Biggs; Respondent: Dana Biggs
Jurisdiction
Australia
Judgment Date
18 September 2023
Procedural Posture
Civil / Final Decision After Hearing
Outcome
Application by Champion Homes Sales Pty Ltd allowed in part; Cross-application by homeowners dismissed
Legal Topics
Contract Termination, Repudiation, Agreed Damages, Penalty Clauses
Building and Construction Contract Contract Termination Repudiation Agreed Damages Penalty Clauses

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Parties

Champion Homes Sales Pty Ltd

Applicant

Darren Biggs

Respondent

Dana Biggs

Respondent

Procedural Posture

Civil / Final Decision After Hearing

Legal Issues

  1. 1 Whether homeowners were entitled to terminate the building contract
  2. 2 Whether wrongful termination entitled builder to damages
  3. 3 Whether liquidated damages clause was a penalty and unenforceable

Ratio Decidendi

The homeowners were not entitled to terminate the contract; their termination was a wrongful repudiation. Champion Homes was entitled to accept the repudiation and terminate the contract. The agreed damages clause of 15% was not a penalty and was enforceable under the contract. Champion Homes was entitled to $61,595.60 (15% agreed damages plus certain development fees minus deposit).

Court Disposition

Application by Champion Homes Sales Pty Ltd allowed in part; Cross-application by homeowners dismissed

Orders

  • The respondents are to pay the applicants the sum of $61,595.60 within 28 days (HB 22/51876)
  • The application is dismissed (HB 23/12205)