Arida v Arida

The appeal in *Arida v Arida* concerned the construction of a Heads of Agreement intended to resolve a commercial dispute. The dispute arose from a contract for the sale of property, where the purchaser was obligated to pay interest if completion did not occur by a specified date. The sellers, who were trustees for sale appointed as part of the resolution of an earlier dispute, were also parties to the Heads of Agreement. The central question was whether the Heads of Agreement altered the purchaser's obligation to pay interest under the sale contract.

The court was required to determine whether the Heads of Agreement had the effect of modifying or overriding the interest clause in the contract for sale. Specifically, the court had to interpret the terms of the Heads of Agreement in light of the sale contract to ascertain the parties' intentions regarding the payment of interest in the event of delayed completion.

The court reasoned that the Heads of Agreement, by its plain language and the context of the dispute it sought to resolve, did not operate to waive or modify the purchaser's contractual obligation to pay interest. The court emphasised the importance of construing the Heads of Agreement as a whole and in conjunction with the underlying sale contract. The appeal was allowed, with the court directing the parties to file agreed short minutes of order reflecting the court's reasons. The respondent was ordered to pay the appellants' costs of the appeal. In a separate proceeding, the Summons for leave to appeal was dismissed.