David Anthony Burnet & Anor v Lily Maria Gubbay [2011] NSWSC 977

David Anthony Burnet & Anor v Lily Maria Gubbay [2011] NSWSC 977

The defendant's deposit cheque was dishonoured and the full $230,000 deposit was never paid. No agreement was established that the plaintiffs would accept $50,000 as a substitute deposit, and the agent's banking, retention or claimed forfeiture of the $50,000 did not constitute affirmation, waiver, variation, accord and satisfaction, or acceptance in place of the plaintiffs' contractual right to terminate. The plaintiffs validly terminated the Contract under clause 2.5 and were entitled to judgment for the deficiency on resale with interest; the defendant failed to establish promissory estoppel or any basis for relief against forfeiture.

Jurisdiction
Australia
Judgment Date
29 August 2011
Procedural Posture
Land Sale Contract Dispute in the Equity Division / Principal Judgment After Hearing
Outcome
Plaintiffs entitled to entry of judgment against the defendant; Cross Claim dismissed.
Legal Topics
['purchase of Land at Auction' 'dishonoured Deposit Cheque' 'termination of Contract' 'election and Waiver' 'promissory Estoppel' 'relief Against Forfeiture' 'accord and Satisfaction' 'contracts Review Act Claim']
['land Law' 'contract Law' 'equity'] ['purchase of Land at Auction' 'dishonoured Deposit Cheque' 'termination of Contract' 'election and Waiver' 'promissory Estoppel' 'relief Against Forfeiture' 'accord and Satisfaction' 'contracts Review Act Claim']

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Procedural Posture

Land Sale Contract Dispute in the Equity Division / Principal Judgment After Hearing

Legal Issues

  1. 1 ['Whether the plaintiffs affirmed the Contract or waived their right to terminate by relation to the $50,000 bank cheque or by retaining and forfeiting it.' 'Whether the plaintiffs were entitled to terminate the Contract after the $230,000 deposit cheque was dishonoured and the full deposit was not paid.' 'Whether a promissory estoppel arose from alleged conversations between Mr Gubbay and the agent, Mr Schwarz.' 'Whether the defendant was entitled to relief against forfeiture of the $50,000 under s 55(2A) of the Conveyancing Act 1919.' "Whether retention of the $50,000 constituted a variation, accord and satisfaction, or acceptance in place of the plaintiffs' right to terminate." "Whether the defendant's claim under the Contracts Review Act 1980 should be maintained."]

Ratio Decidendi

The defendant's deposit cheque was dishonoured and the full $230,000 deposit was never paid. No agreement was established that the plaintiffs would accept $50,000 as a substitute deposit, and the agent's banking, retention or claimed forfeiture of the $50,000 did not constitute affirmation, waiver, variation, accord and satisfaction, or acceptance in place of the plaintiffs' contractual right to terminate. The plaintiffs validly terminated the Contract under clause 2.5 and were entitled to judgment for the deficiency on resale with interest; the defendant failed to establish promissory estoppel or any basis for relief against forfeiture.

Court Disposition

Plaintiffs entitled to entry of judgment against the defendant; Cross Claim dismissed.

Orders

  • ['Judgment for the plaintiffs for the shortfall between the purchase price under the Contract and the price for which the Property was sold in February 2010 with interest.' "The defendant's Cross Claim will be dismissed." 'The parties are to file Short Minutes of Order in respect of the quantum of the judgment...