M & W Zaki Pty Ltd v MindChamps Preschool Ltd (No 2) [2022] NSWCA 266

M & W Zaki Pty Ltd v MindChamps Preschool Ltd (No 2) [2022] NSWCA 266

Clause 12(a) required Little Zaks to immediately notify any party with whom discussions had commenced that such discussions were terminated, and to cease all further communication during the exclusivity period. The failure to terminate discussions and cease communication with Eden and Chiwayland constituted a breach of clause 12(a), which triggered the obligation under clause 12(c) to return the deposit to MindChamps.

Parties
First Appellant: M & W Zaki Pty Ltd ATF the Zaki Group Trust (ABN 99 233 987 815); Second Appellant: Childcare Income Protection Pty Ltd ATF the KZ Trust (ABN 94 358 741 310); Third Appellant: Mark Zaki; Respondent: MindChamps Preschool Ltd
Jurisdiction
Australia
Judgment Date
14 December 2022
Procedural Posture
Appeal / Final Judgment
Outcome
Appeal dismissed with costs.
Legal Topics
Breach of Contract, Exclusivity Clauses, Deposit Return, Construction of Contract
Contract Breach of Contract Exclusivity Clauses Deposit Return Construction of Contract

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Parties

M & W Zaki Pty Ltd ATF the Zaki Group Trust (ABN 99 233 987 815)

First Appellant

Childcare Income Protection Pty Ltd ATF the KZ Trust (ABN 94 358 741 310)

Second Appellant

Mark Zaki

Third Appellant

MindChamps Preschool Ltd

Respondent

Procedural Posture

Appeal / Final Judgment

Legal Issues

  1. 1 Whether appellants breached the exclusivity obligations under clause 12(a) of the Term Sheet
  2. 2 Whether such breach enlivened the obligation to return $500,000 deposit under clause 12(c)

Ratio Decidendi

Clause 12(a) required Little Zaks to immediately notify any party with whom discussions had commenced that such discussions were terminated, and to cease all further communication during the exclusivity period. The failure to terminate discussions and cease communication with Eden and Chiwayland constituted a breach of clause 12(a), which triggered the obligation under clause 12(c) to return the deposit to MindChamps.

Court Disposition

Appeal dismissed with costs.

Orders

  • Appeal dismissed
  • Appellants to pay the respondent's costs