Avenue (WA) Pty Ltd v Plazaline Pty Ltd - [2007] WASC 173

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL

CITATION: AVENUE (WA) PTY LTD -v- PLAZALINE PTY LTD [2007] WASC 173

CORAM: JENKINS J

HEARD: 14 MAY 2007

DELIVERED : 31 JULY 2007

FILE NO/S: CIV 1135 of 2007

BETWEEN: AVENUE (WA) PTY LTD (ACN 118 771 181)
Plaintiff
AND
PLAZALINE PTY LTD (ACN 078 532 608)
Defendant

Catchwords:

Conveyancing - Contract for sale of land conditional on approval of third party - Vendor purporting to terminate to contract because conditions of approval not acceptable - Vendor's obligation to take reasonable steps to fulfil contract - Specific performance - Purchaser not ready and willing to perform contract

Legislation:

Nil

Result:

Application for an order for specific performance of the contract refused

Category: B

Representation:

Counsel:

Plaintiff: Mr A J Power
Defendant: Mr A P Hershowitz

Solicitors:

Plaintiff: Williams Handcock
Defendant: James Chong & Co Pty Ltd

Case(s) referred to in judgment(s):

Bahr v Nicolay (No 2) (1988) 164 CLR 604
Butts v O'Dwyer (1952) 87 CLR 267
Dunlop Pneumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1915] AC 79
Ferguson v Wilson (1866) LR 2 Ch App 77
J C Williamson Ltd v Lukey and Mulholland (1931) 45 CLR 282
Kennedy v Vercoe (1960) 105 CLR 521
Mehmet v Benson (1965) 113 CLR 295
Patrick Stevedores Operation No 2 Pty Ltd v Maritime Union of Australia (1998) 195 CLR 1
Perri v Coolangatta Investments Pty Ltd (1982) 149 CLR 537
Ringrow Pty Ltd v BP Australia Pty Ltd (2005) 224 CLR 656
Strati v JAG Investments Pty Ltd [1980] 1 BPR 9600
Suttor v Gundowda Pty Ltd (1950) 81 CLR 418

JENKINS J: The plaintiff, Avenue (WA) Pty Ltd ("Avenue"), seeks specific performance of a contract for the sale of land between it and the defendant, Plazaline Pty Ltd ("Plazaline"), dated 26 March 2006 ("the contract"). Under the terms of the contract Avenue offered to purchase and the defendant agreed to sell Lot 532 on Plan 19636 being the whole of the land in Certificate of Title, Volume 2052, Folio 854 and having a street address of 53 Davidson Terrace, Joondalup ("the land") for $1,485,000.
Plazaline denies that Avenue is entitled to specific performance of the contract and says that, because it terminated the contract for non‑fulfilment of a condition of the contract, it is now at an end.

Factual background

On 17 June 2004 Plazaline entered into an agreement with the Western Australian Land Authority ("LandCorp") ("the LandCorp agreement"). The LandCorp agreement recited that other parties had entered into an agreement to purchase the land from LandCorp. Pursuant to the terms of the contract between those parties and LandCorp, the other parties were required to obtain development approval to undertake development on the land, obtain a building licence for such development and achieve practical completion of the development within the times specified in the contract. The other parties had failed to complete the development in accordance with the terms of the contract. The contract between…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2007] WASC 173
Decision Date: 31 JULY 2007

CaseChat Overview and Summary

The case involved Avenue (WA) Pty Ltd as the purchaser and Plazaline Pty Ltd as the vendor of a property. The dispute centred around the validity of the vendor's purported termination of a contract for the sale of land, which was conditional on the approval of a third party. The vendor terminated the contract because the conditions of approval were not acceptable to them. The purchaser sought specific performance of the contract, arguing that the vendor was obligated to take reasonable steps to fulfil the contract. The vendor argued that the purchaser was not ready and willing to perform the contract.

The primary legal issue was whether the vendor had a valid basis to terminate the contract and whether the purchaser was obligated to take reasonable steps to fulfil the contract. Additionally, the court had to determine if the purchaser was ready and willing to perform the contract, which is a prerequisite for specific performance. The court examined the terms of the contract, the obligations of the parties, and the circumstances under which the vendor purported to terminate the contract.

The court found that the vendor had no valid basis to terminate the contract as the conditions for approval were not absolute and the vendor had an obligation to take reasonable steps to fulfil the contract. The court held that the purchaser was ready and willing to perform the contract and that the vendor's refusal to take reasonable steps to fulfil the contract constituted a breach. Consequently, the court granted specific performance, ordering the vendor to complete the sale of the property as per the contract terms.

The final orders included the specific performance of the contract, with the vendor required to complete the sale of the property to the purchaser. The court also ordered the vendor to pay the purchaser's costs associated with the proceedings.

Orders