Anthony Industries Proprietary Limited (ABN 81 004 493 609) v Rock Development and Investment Pty Ltd (ACN 168 484 811)
[2017] VCC 593
•19 May 2017
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMERCIAL DIVISION | Revised Not Restricted Suitable for Publication |
GENERAL LIST
Case No. CI-16-00443
| ANTHONY INDUSTRIES PROPRIETARY LIMITED (ABN 81 004 493 609) | Plaintiff |
| v | |
| ROCK DEVELOPMENT & INVESTMENTS PTY LTD (ACN 168 484 811) | Defendant |
| and | |
| MAGDY SOWIHA | Second Defendant |
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JUDGE: | HIS HONOUR JUDGE O’NEILL | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 6, 7, 10, 24 April 2017 | |
DATE OF JUDGMENT: | 19 May 2017 | |
CASE MAY BE CITED AS: | Anthony Industries Proprietary Limited (ABN 81 004 493 609) v Rock Development & Investment Pty Ltd (ACN 168 484 811) & Anor | |
MEDIUM NEUTRAL CITATION: | [2017] VCC 593 | |
REASONS FOR JUDGMENT
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Subject: BREACH OF CONTRACT
Catchwords: Contract for sale of land – breach of terms in failure to pay balance of deposit and balance of settlement monies – dispute as to whether costs of various works to be undertaken by the purchaser to be set off against deposit – alleged frustration of purchaser’s efforts to carry out works to premises – nature and extent of damages consequent upon the breach
Cases Cited:Hoyt’s Pty Ltd v Spencer (1919) 27 CLR 133; Gates v City Mutual Life Assurance Society Ltd (1986) 160 CLR 1; Victorian Economic Development Corporation v Clovervale Pty Ltd & Ors [1992] 1 VR 596; Riggall & Anor v Thompson [2010] QCA 144; Tabcorp Holdings Ltd v Bowen Investments Pty Ltd [2009] HCA 8
Judgment: Judgment for the plaintiff.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr G Bloch | Hughes Legal |
| For the Defendants | The second defendant appeared in person, and represented the first defendant | - |
HIS HONOUR:
Preliminary
1 On about 30 June 2014, the plaintiff, Anthony Industries Proprietary Limited (“Anthony Industries”), entered a contract (“the Contract”) with the first defendant, Rock Development & Investments Pty Ltd (“Rock Development”), for the sale of a property at 68 Keon Parade, Thomastown (“the property”) for the sum of $3,700,000.
2 The second defendant, Mr Sowiha, is said to be liable for the performance by Rock Development of the terms of the Contract, pursuant to General Condition 19 which makes a signatory on behalf of a proprietary company liable as if he were the purchaser. He did not contend otherwise.
3 The Contract provided that the purchase price was to be paid by a deposit of $185,000 and the balance on 30 January 2015. There was a further condition that Rock Development would carry out various works to the premises (referred to as “divisional works”) to enable the property (which was used as a factory and warehouse) to be divided so that Rock Development would occupy a part of the property after settlement, along with various other existing tenants. Anthony Industries was to contribute $185,000 towards those divisional works.
4 At the time the Contract was executed, the tenants were Dalton Ironbark Pty Ltd (“Dalton Ironbark”), Interroll Australia Pty Ltd (“Interoll”) and a company associated with the plaintiff, Anthony Innovations Pty Ltd (“Anthony Innovations”), the latter over holding under a previous lease.
5 The Contract was conditional upon approval by the local council of a “conceptual plan”. After Mr Sowiha had executed the Contract on 30 June 2014, he provided the estate agent responsible for effecting the sale of the property, Mr David Butera, with a cheque for $185,000. Mr Butera did not bank the cheque as it was not his practice to do so until a contract became unconditional. On 9 July 2014, Mr Butera was notified the plan had been approved and the Contract was unconditional.[1] He was then advised by Mr Sowiha not to bank the $185,000 cheque, as it would bounce. In lieu, a “holding deposit” of $20,000 was paid.
[1]See exhibit D, Joint Court Book (“CB”) 364
6 It is clear neither the deposit (save for the holding deposit of $20,000) nor the balance of the purchase price was paid. A Notice of Rescission was served and the Contract terminated.
7 The Contract did not provide for a particular date by which the divisional works were to be completed. In evidence, both Mr Anthony, a director and the principal of the first defendant, and Mr Sowiha, said it was their expectation that the works would be carried out prior to settlement, initially in approximately late October or early November 2014. According to the evidence, it was necessary for asbestos in the property to be removed before the other divisional works could be undertaken. As time passed, Mr Anthony had various discussions with Mr Sowiha, even up until February 2015, to re-schedule the divisional works.[2] The works were never undertaken.
[2]See exhibits 1, 2, 3 and 4, CB 414-415, 436, 595-597, 712-713
8 After the Contract was rescinded, a new real estate agent was appointed, a marketing campaign undertaken, and the property resold to another purchaser.[3] According to Mr Anthony, it was necessary to carry out a range of works, including the removal of the asbestos, in order for the property to be appropriately marketed and presented for sale. Those works were carried out and paid for by Anthony Industries. The purchase price under the second contract was significantly less than the first.
[3]Exhibit P, CB 937-950
9 Anthony Industries seeks damages either in accordance with the terms of the Contract of Sale, or at law, for Rock Development’s breaches.
10 There were only two issues raised in defence of these claims: Rock Development and Mr Sowiha allege the $185,000 to be paid by Anthony Industries towards the divisional work was agreed to be set off against the deposit. That is, the deposit did not have to be paid. Further, they say efforts by its employees and contractors to carry out the divisional work were frustrated by Mr Anthony failing to allow those workers and contractors onto the property to perform the works, and for failing to remove various pieces of machinery out of the way so that the works could be carried out.
11 Mr Sowiha denies any liability for damages.
The Defendants’ contentions
(a) The set off of the cost of the divisional works against the deposit
12 In evidence, Mr Sowiha said there was agreement that instead of paying the $185,000 deposit (of which $20,000 was actually paid), that would be set off against the obligation of Rock Industries to contribute the same sum, $185,000, towards the divisional works. There was nothing in the Contract to support this contention.
13 In evidence, Mr Anthony said there was never any agreement in relation to the payment of the deposit, save as provided in the Contract.
14 He said the first he had heard of any proposal to set off the deposit against the costs of the divisional works was in a meeting after the Contract had become unconditional.
15 At the meeting was Mr Butera, the agent, and Mr Sowiha. He said at the meeting he made it clear, both to the agent and Mr Sowiha, that the deposit was to be paid, and instructed the agent to follow it up. He said the figure of $185,000 for the divisional works was a figure suggested by Mr Sowiha, and not by him. He thought the divisional works would have cost more, but accepted Mr Sowiha, being the principal of a building company, would be able to carry out the works.
16 According to the evidence of Mr Butera, he said there was a meeting at the office of Anthony Industries around 16 July 2014. Mr Anthony and Mr Sowiha were both present. There was a discussion about the divisional works and then a discussion about the deposit. He said it was clear Mr Anthony wanted the deposit paid. He said that Mr Sowiha said he would organise for a deposit to be paid. He made reference to a “letter of comfort” in relation to the $185,000.
17 Mr Butera said that he followed the payment of the deposit up by telephone with Mr Sowiha on more than sixty occasions. He made diary notes.[4] This was denied by Mr Sowiha in the course of his evidence. He said he met with Mr Sowiha at his office on 23 July 2014. He said Mr Sowiha referred to organising a bank guarantee to be payable that week. There was also a “QBE commercial bond” discussed. None of these proposals ever eventuated.
[4]Exhibit W
18 Mr Sowiha said that within two to three days of the signing of the Contract, he had a meeting with Mr Butera at his office. He said he reached agreement that the $185,000 to be paid by the vendor for the divisional works would be set off against the deposit. Subsequently, he said there was another meeting with both Mr Butera and Mr Anthony present, where Mr Butera denied such an agreement had been reached.
19 In contrast to Mr Sowiha’s contention that the deposit was to be set off against the cost of the divisional works, he said in evidence, that he attempted to come up with a middle solution and suggested that he provide a commercial bond, or some other financial arrangement in order to “give comfort” to Mr Anthony in relation to the deposit. He said while he agreed to do this, he never agreed to any particular date as to when it was to be provided. He was unable to explain why, in circumstances where he says there was an agreement that the deposit be set off against the divisional works, that there was any need for any financial “comfort” to be provided to Mr Anthony.
20 I am of the view there is no merit to Mr Sowiha’s submission that it was a term of the Contract that the $185,000 deposit was to be set off against the $185,000 that the vendor was to contribute towards the divisional works. In the first place, the terms of the Contract are clear. Although there was no date provided for the payment of the deposit, the Contract was clear that it was to be paid. This was also the intention of the parties, given a cheque for that sum was provided to the agent at the time the Contract was signed. There is thus no basis to go beyond the clear written terms of the Contract. There is nothing to suggest the Contract was anything other than a complete record of the terms of the agreement and no oral evidence should be admitted to qualify those terms.[5]
[5]See Hoyt’s Pty Ltd v Spencer (1919) 27 CLR 133 at 143; Gates v City Mutual Life Assurance Society Ltd (1986) 160 CLR 1
21 Even if that were not the case, then I am not satisfied that there was any verbal amendment to the Contract, or collateral contract which made other provision for the deposit. I accept the evidence of the agent, Mr Butera, that while the issue of the deposit was discussed, there was no agreement that it be set off against the cost of the divisional works. I accept the evidence of Mr Anthony to the same effect. Mr Butera said he made more than sixty telephone calls to follow up payment of the deposit,[6] and although his diary records are not all specific to that question, I do accept that on a significant number of occasions he did pursue the matter with Mr Sowiha or others representing Rock Development.
[6]Exhibit W, CB 784-792
22 I do not accept the evidence of Mr Sowiha in relation to this issue. I did not find him a particularly credible witness. He prevaricated, and was not responsive in cross-examination. Further, it is difficult to understand why he was concerned to provide “financial comfort” to the vendor if there was the clear agreement he alleges in relation to the deposit. His evidence as to why he went down that path was quite unsatisfactory. Indeed, it is difficult to understand why a further deposit of $20,000 was paid at all.
23 Finally, in an email of 10 August 2014, Mr Daniel Spasevski, said to be an in-house lawyer of Mr Sowiha’s associated company, Eliana Group, said: “It is noted that the deposit for the purchase remains outstanding.”[7]
[7]Exhibit T, CB 381
24 Mr Sowiha provided written submissions. He said:
“17. After that the agent asked to meet me in my office and he told me that ‘the vendor accept[s] that Eliana Group will do the divisional work against the deposit money then we amend the contract in that day and initial as well’ please see the handwriting beside the additional special condition 1.7 with a different pin (scil pen)[8] … ‘The Agreement reached’ and we start using the deposit money.
… .”[9]
[8]CB 218
[9]See defendants’ Written Submission, page 4
25 The handwriting alongside Special Condition 1(7) does not suggest there was any agreement in relation to the set off of the deposit. Rather, the handwriting provides that the purchase will carry out various works at the property, with the vendor contributing $185,000 towards those works.
26 Mr Sowiha’s submissions went on to contend that a second agreement was reached on 14 July 2014, although it is not clear what he alleges occurred on that date, aside from the agent denying there had been any further agreement in relation to the deposit.
27 Mr Sowiha further contends that at a meeting on 17 October 2014, a “third agreement” was reached between himself and Mr Anthony that no further deposit would be paid. In October 2014, there were letters sent on behalf of Rock Development that there was no further deposit to be paid, or that the payment was “cancelled” by the vendor’s contribution to the works.[10] However, this was well after, when it was said the further agreement was reached, and was contested in emails by solicitors on behalf of the vendor. I am not satisfied that there was no amendment to the original contact, or collateral contract as alleged by Mr Sowiha. The deposit was not paid, and a Notice of Rescission issued. Given the Notice was not remedied, the Contract was rescinded.
[10]CB 533, 548
(b) The purchaser’s inability to carry out the divisional works
28 It is clear from the Contract the parties intended for the divisional works to be carried out to enable Rock Development to occupy part of the property. The associated company, Anthony Innovations, and two other tenants, were to occupy the remainder of the property. The divisional works were to be “conducted in a proper workman-like manner and will be completed in line with all relevant approvals if required by the statutory authority(s)”.[11]
[11]Special Condition 1(7)
29 A significant aspect of the divisional works was the removal of asbestos from the property. It was clear from the evidence of Mr Sowiha and Mr Anthony, that the asbestos removal had to be carried out before the other works. The Contract did not provide any schedule or date by which the divisional works were to be completed. However, it was clear from the evidence, both of Mr Sowiha and Mr Anthony, that both vendor and purchaser contemplated that at the outset, the divisional works would be concluded by settlement on 30 January 2015.
30 At the outset, there was communication between the parties as to what each was to do in order to undertake the works. Initially, on 25 July 2014, a schedule was planned.[12] That was confirmed by a further schedule of 31 July 2014.[13] A further draft schedule was prepared in early December 2014.[14] Finally, even after the date for the payment of the balance of the purchase price expired, a further schedule of 12 February 2015 was prepared.[15] Shortly afterwards, a Notice of Rescission was issued and served. None of the divisional works were carried out by the purchaser.
[12]Exhibit 1, CB 414-415
[13]Exhibit 2, CB 436
[14]Exhibit 3, CB 595-598
[15]Exhibit 4, CB 712-713
31 Rock Development’s contention is two-fold. Firstly, it says Anthony Industries did not relocate machinery, and equipment as was required by Special Condition 1(6)[16] and further, that Mr Sowiha and his companies were unable to gain access to the premises to carry out the works.
[16]That Special Condition requires the removal of machinery and equipment by Anthony Innovations, the tenant at the premises, but nothing turns on the issue
32 Mr Anthony gave evidence that a dispute arose in relation to the carrying out of the divisional works. He said Mr Sowiha, or his representatives, had not provided any documents to his company or WorkSafe to ensure the site would be made safe for the removal of the asbestos. There were others workers in the factory whose health had to be protected. He insisted upon proper compliance with occupational health and safety regulations. He said Anthony Industries kept a register of asbestos material within the factory. This was provided to the purchaser. There was also an asbestos policy. By email of 21 October 2014,[17] Mr Sulja, on behalf of Anthony Innovations, requested Mr Sowiha provide details of the asbestos contractor to carry out the works, including “completed job safety analysis form, group site induction checklist, certification and evidence the contractor is WorkSafe approved”, confirmation that air monitoring would take place in the course of the works and further, upon completion of the works, a clearance inspection report by a WorkSafe inspector. The email concluded:
“As we are quickly nearing the Cup weekend and I need this information … as soon as possible as I am required to have it available five working days before works begin, I therefore require this information by Friday the 24th [October] to ensure we have documentation in order and in place, to proceed on time.”[18]
[17]Exhibit F, CB 535-536
[18]CB 536
33 Nothing happened over that weekend, and by email of 17 November 2014, Mr Anthony confirmed with Mr Sowiha the parties’ intention for the divisional works to proceed. It was then contemplated that the divisional works would be carried out over the Christmas period. The email said the following:
“The asbestos removal needs to be done by fully qualified contractors with air monitoring and all OHS and JSA requirements adhered to. This needs to be completed and locked in by 15th December at the latest. (Magdy – we did not discuss this last sentence. Are you agreeable to this?).”[19]
[19]Exhibit G, CB 576
34 By email of 12 February 2015 to Mr Sowiha and others, Mr Anthony said, in response to an earlier email:
“Plans and processes had been put in place last year for the divisional works as outlined in the Contract of Sale to commence on behalf of the Purchaser. At the request of the Vendor’s representative, Adam Sulja, the Purchaser was directed to halt all works in writing prior to the Melbourne Cup weekend which was when the asbestos removal was to occur.”
(in response)
“Yes, this is correct. Adam postponed these works because the Purchaser was not ready for these works to the satisfaction of Worksafe requirements. The asbestos removal needed to be performed by fully qualified contractors with air monitoring and all OHS and JSA requirements adhered to. None of this documentation has been prepared and accepted by Worksafe and thus we were not prepared to risk the health of our employees. At the same time we insisted that the balance of the deposit be paid before works can start. This had not been complied with.”[20]
[20]Exhibit L, CB 700
35 According to Mr Sowiha, he obtained two quotations for the asbestos work.[21]
[21]Exhibits 7 and 8
36 On 30 October 2014, there were a number of emails confirming that the works at the property were to be put on hold until settlement.[22]
[22]Exhibit 9, CB 550-551
37 According to the evidence of Mr Sowiha, he said the vendor was in breach of the Contract as it was the obligation on the vendor to arrange for the removal of the machinery, which he said had not occurred. He said his workmen could not get access to the property. This, said Mr Sowiha, was confirmed by various letters sent by his solicitors and eventually, a Rescission Notice being served on behalf of the purchaser.[23]
[23]See exhibits 12, 13, 14 and 15; CB 719, 721, 724, 389
38 Mr Sowiha said that he had done all within his power to ensure the transaction proceeded to settlement. He said he had finance available through his mortgagee, confirmed by a letter of 29 January 2015.[24] Although the letter noted the loan had been fully approved, and documents signed, it was required that the bank perform a “final review” of the various leases affecting the property, and the issue of occupancy permits for the “Santorini project”. That project was apparently another development being undertaken by Mr Sowiha.
[24]Exhibit Z, CB 661
39 Mr Sowiha gave evidence that late in the day, he was prepared to settle the property without any of the divisional works being carried out. That did not occur.
40 It is clear the parties intended that the divisional works would be carried out prior to settlement. There were various schedules prepared, setting out the parties’ expectations as to when the works would be undertaken, and the steps necessary on the part of the vendor to permit that to happen.
41 I accept the evidence of Mr Anthony that there were significant delays, as appropriate legislative and other requirements in relation to the removal of the asbestos were not met. I do not accept the evidence of Mr Sowiha that the fault was due to the vendor failing to relocate plant and machinery to enable the works to be carried out.
42 Notwithstanding this, the parties harboured hopes that the divisional works would be carried out over the Christmas period, or not carried out at all, with the purchaser taking the property in the same state it was in as when purchased. There was little, if any, evidence from Mr Sowiha about the steps he took to facilitate the carrying out of the divisional works. There were letters of demand from his solicitor at a later time, but nothing contemporaneous. That may be explained by the parties attempting to keep the transaction on the rails.
43 A point was reached, in early 2015, where the continued failure to pay the balance of the deposit money, and the balance of the purchase money, prompted to the issue of the Notice of Rescission. That failure lies at the foot of the purchaser. Even if, as Mr Sowiha would have it, he made every reasonable endeavour to perform the divisional works and was frustrated in so doing, which I do not accept, the failure to pay the deposit and the balance of the purchase money brought the Contract to an end, leading to an entitlement to damages on the part of the vendor.
44 The purchaser’s contentions in relation to this aspect of the Contract fail.
Damages
45 I am of the view the Contract was rescinded by a Notice of Rescission dated 13 February 2015, properly served upon the purchaser.[25] The basis of the rescission was the failure to pay the balance of the deposit, and the failure to pay the balance of the purchase money. The purchaser did not remedy the default within the time prescribed by the Notice of Rescission.
[25]Exhibit M, CB 714
46 General Condition 28.4 of the Contract relevantly provides:
“28.4 If the contract ends by a default notice given by the Vendor:
…
(c)In addition to any other remedy, the vendor may within one year of the contract ending either:
(i)retain the property and sue for damages for breach of contract; or
(ii)resell the property in any manner and recover any deficiency in the price on the resale and any resulting expenses by way of liquidated damages; …
…
28.5The ending of the contract does not affect the rights of the offended party as a consequence of the default.”[26]
[26]Part of exhibit B, CB 215
47 The property was sold subsequently for the sum of $3,430,000 by a Contract of Sale dated 2 September 2015.[27]
[27]Exhibit P, CB 937-950
48 Evidence was given by another estate agent, Mr Drew Williams, who conducted the second sale. He said there was an extensive marketing campaign and many brochures were sent out to a large number of developers.[28] He said he discussed with Mr Anthony whether the property was to be sold with vacant possession, with the existing tenants, or with one of Mr Anthony’s companies as a tenant. He said Mr Anthony was open to all these options, depending upon the requirements of the purchaser. This was also the evidence of Mr Anthony.
[28]See exhibit 5, CB 316-333
49 Mr Williams said the sale price represented a fair market value at the time. There was a Special Condition in the Contract[29] that the sale was conditional upon the vendor removing all asbestos from the factory, with the purchaser agreeing to contribute $45,000 towards that cost. Further, new carpet was to be provided in various areas, and cleaning and landscaping work undertaken.
[29]CB 941
50 Evidence was given by Mr Steven Boyd, a valuer, and his report tendered into evidence.[30] He valued the property in November 2016 at $3,430,000.
[30]Exhibit X, CB 55-113
51 Evidence was given by Mr Douglas Buchanan, a quantity surveyor, and his report tendered into evidence.[31] His report concluded that the costs and expenses related to the removal of the asbestos, and the other items the subject of the Special Conditions, were fair and reasonable in the circumstances.
[31]Exhibit Y, CB 114-153, 1011, 1008 and 1023
52 Evidence was given by Mr Alistair Kensley, a registered valuer, and his report of 16 July 2014 (which was obtained upon the instructions of Mr Sowiha’s bank) was tendered into evidence.[32] He valued the property at that time at $3,700,000.
[32]Exhibit 18
53 It is not necessary for me to determine which of the valuation reports I accept. In my view, it is appropriate to determine the fair market value of the property as that paid by the ultimate purchaser when re-sold. I am satisfied the marketing campaign was appropriate, and it was necessary to carry out the removal of the asbestos and the other works to obtain the best price in the circumstances. I accept the plaintiff’s submission that the loss effected upon resale as $250,000, crediting the $20,000 preliminary deposit.
54 I am further satisfied that the resale costs, including agent’s commission, legal costs and marketing expenses, are properly claimable as liquidated damages under the Contract. General Condition 28.4(c)(ii) provides that the vendor may “… recover any deficiency in the price on the resale and any resulting expenses by way of liquidated damages”.
55 In Victorian Economic Development Corporation v Clovervale Pty Ltd & Ors,[33] Tadgell J considered damages under a similar clause of a contract for the sale of land, and said:
“… The damages may also include expenses or other loss that had necessarily flowed from the breach; and the rule in Hadley v. Baxendale will apply. If these included the expenses of an appropriate resale they will ordinarily be recoverable; and if any necessary outgoings have been incurred or losses suffered in the period between breach and resale, these may also be recoverable. … .”[34]
[33][1992] 1 VR 596
[34]At 604
56 Further, in Riggall & Anor v Thompson,[35] the Queensland Court of Appeal, considering damages which a vendor could recover for breach of a contract of sale of land, said:
“… the correct analysis in this quite typical situation is explained in McGregor on Damages:[36]
‘This head of damage requires to be analysed rather carefully, since the expenses of the abortive sale would have been incurred even had the buyer not defaulted; putting the seller into the position he would have been in had the contract been performed still entails his having incurred these expenses. The true analysis is this. The seller recovers the full contract price less the net market value of the property left on his hands, ie the amount at which a resale has been or could be made deducting therefrom the costs of resale. Thus the expenses to be looked at are not those of the abortive sale but those of the resale, or, where there has been no resale, the estimated costs of a resale.”[37]
[35][2010] QCA 144 (Fraser JA with Holmes JA and Daubney J agreeing)
[36]Harvey McGregor, McGregor on Damages, (17th ed, 2006), at 22–037
[37](Supra) at paragraph [25]
57 At the end of the day, the second contract was executed on the basis that the previously existing leases to Interoll and Dalton Ironbark would remain, and there be a further lease to Anthony Industries. In the event the further asbestos and like works were not “liquidated damages” within the contemplation of General Condition 28 of the Contract, then I am satisfied those damages were within the type contemplated by the parties as would result from any breach of the Contract. I accept the submissions on behalf of the plaintiff in this regard.[38]
[38]See paragraphs 8.2-8.5 of the Plaintiff’s Submissions
58 There is a further argument that the $185,000 which the vendor was required to pay towards the divisional works under the original Contract ought be deducted from its entitlement to damages. Mr Bloch submits that although the vendor was relieved of its obligation to contribute the $185,000 towards the divisional works, so was the purchaser relieved of its obligation to carry out the works. He submits it would be unreasonable to oblige the vendor to effectively make account of that contribution without a similar obligation on the part of the purchaser. It was clear from the evidence of the parties that the cost of the divisional works would significantly exceed $185,000. The principle to be borne in mind is that where a party sustains a loss by breach of contract, then that party should be placed in the same situation, so far as money can do it, with respect to damages, as if the Contract had been performed.[39] Were the contribution of $185,000 to be take into account, then the vendor would, unfairly, not have the benefit of the purchaser having carried out the works at a cost considerably in excess of that sum. I accept the submission of Mr Bloch that it would be unreasonable to deduct that amount.
[39]See Tabcorp Holdings Ltd v Bowen Investments Pty Ltd [2009] HCA 8
Conclusion
59 I do not accept the contentions on behalf of the defendants, firstly, that there was any agreement that the deposit of $185,000 ought be set off against the vendor’s contribution to the divisional works. Further, I am not satisfied from the evidence, either that the purchaser was frustrated in its attempts to carry out the divisional works or was unable to do so because there was machinery preventing it from doing so.
60 I am satisfied the Contract was properly rescinded for want of payment of both the deposit and the balance of the purchase monies.
61 I am satisfied that all of the damages sought by the vendor are appropriate in the circumstances.
62 I shall make consequent orders after consultation with the parties as to the damages claimed, interest and like matters.
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