Art Vanderlay Pty Ltd v Stewart

Art Vanderlay Pty Ltd brought proceedings against Stewart, seeking specific performance of an agreement to transfer shares in a company that granted a leasehold interest in a residential unit. Stewart, who agreed to sell their shares to Art Vanderlay, was required under the sale conditions to use their best endeavours to obtain the approval of the company's directors for the transfer. The share transfer did not proceed, and Stewart now sought summary judgment regarding Art Vanderlay's claim for specific performance. The court was required to determine if Art Vanderlay had any real prospect of successfully establishing that Stewart failed to use their best endeavours to secure the transfer to Art Vanderlay.

The court found that Art Vanderlay had a real prospect of successfully establishing that Stewart failed to use their best endeavours to secure the transfer of shares. The court held that there were factual disputes concerning the extent of Stewart's efforts to obtain the approval of the directors. The court found that there were questions of fact as to whether Stewart had used their best endeavours, and whether they had acted honestly and in good faith. As a result, the court held that Art Vanderlay had a real prospect of success on their claim.

The court dismissed the application for summary judgment, finding that Art Vanderlay had a real prospect of successfully establishing that Stewart failed to use their best endeavours to secure the transfer of shares. The court also held that there were questions of fact as to whether Stewart had acted honestly and in good faith, and therefore, summary judgment was not appropriate. The court reserved the costs of and incidental to the application.