be secured by mortgage-Terms to be settled by solicitors-Trustees to be nominated by purchasers-Survey-Refusal of vendor to carry out agreement--Readiness and willingness of purchasers-Remedy-Certainty of contract-Want of mutuality.

By an agreement for the sale of land for £900, part of a larger block of land held under one certificate of title, it was provided that, upon the consent of the Treasurer being given, the vendor should execute a nomination of trustees over the land to trustees appointed by the purchasers upon their paying £500 and upon the trustees executing a mortgage securing the balance of the purchase moneys and containing such other terms and conditions as required by the solicitors for the purchasers. The agreement also made provision for delivery of possession and the vendor paying survey fees to enable the land to be transferred. No survey was ever made and although trustees were appointed their names were never notified to the vendor. Possession was not given on the due date and the vendor repudiated on the ground that the purchase moneys were not paid. The purchasers then advised the vendor of their willingness to proceed with the sale and sent £500 which was refused. In a suit for specific performance by the purchasers,

Held that there was a concluded contract as the settlement of the terms of the mortgage and the nomination of trustees did not depend upon further agreement between the parties.

Held, further, that a decree should be made for specific performance of the contract as the conditions not performed by the purchasers were merely the subsidiary means of carrying out the contract.

Williams v. Brisco, (1882) 22 Ch. D. 441; Milnes v. Gery (1807) 14 Ves. 400 [33 E.R. 574], distinguished.

Decision of the Supreme Court of Queensland (Philp J.) reversed.

80 CLR 220

APPEAL from the Supreme Court of Queensland.

Twelve members of a firm known as Maryborough Bread Distri- butors sued Michael O'Brien in the Supreme Court of Queensland for specific performance of an agreement in writing for the sale to them by the defendant of certain land upon which were erected a bakehouse and shop. The relevant portions of the agreement and the facts are set out in the judgment of Latham C.J.

By his defence the defendant contended that if there were a valid agreement the plaintiffs had failed to perform their part of the said agreement in that they refused to pay the purchase moneys, failed to tender for execution any nomination of trustees, failed to appoint trustees and failed to have prepared or signed or delivered any bill of mortgage.

Philp J. held that as there was no evidence that any persons were prepared to act as trustees, the contract could not be enforced against the plaintiffs. Accordingly, as there was no mutuality, he refused a decree of specific performance and dismissed the suit.

From this decision…

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.

Continue reading Axelsen v O'Brien

Details

AGLC: Axelsen v O'Brien [1949] HCA 18
Case: [1949] HCA 18
Decision Date: 22 June 1949

CaseChat Overview and Summary

The case of *Axelsen v O'Brien* involved an appeal to the High Court of Australia from a decision of the Supreme Court of Queensland. The dispute concerned a written agreement for the sale of land for £900. The purchasers sought specific performance of this agreement, which the vendor had repudiated. The agreement stipulated that part of the purchase price would be secured by a mortgage, with the terms of the mortgage and the nomination of trustees to be settled by solicitors. The vendor argued that the contract was uncertain and lacked mutuality, and that the purchasers had failed to perform their obligations.

The legal issues before the High Court were whether a concluded and enforceable contract for the sale of land existed, and if so, whether the purchasers were entitled to a decree of specific performance. Specifically, the court had to determine if the provisions regarding the settlement of mortgage terms by solicitors and the nomination of trustees rendered the contract too uncertain to be enforced, and whether the purchasers' failure to fulfil these subsidiary conditions, prior to the vendor's repudiation, precluded them from seeking specific performance. The court also considered whether the vendor's repudiation excused the purchasers from performing these conditions.

The High Court held that a concluded contract did exist. It reasoned that the settlement of the mortgage terms by solicitors and the nomination of trustees were subsidiary means to carry out the contract, rather than essential terms requiring further agreement between the parties. The court found that the vendor's repudiation of the contract, based on an incorrect assertion of the purchasers' default, excused the purchasers from fulfilling these subsidiary conditions. The court distinguished the present case from authorities where contracts were deemed uncertain due to essential terms being left for future agreement. The court concluded that the conditions not performed by the purchasers were not conditions precedent to the existence of the contract itself, but rather steps in its execution, and that the vendor's breach had prevented their completion.

Consequently, the High Court allowed the appeal, discharged the order of the Supreme Court, and declared that the agreement ought to be specifically performed and carried into execution. The purchasers were ordered to pay the sum of £900 with interest into the Supreme Court, and the action was remitted to that court for consequential directions to effectuate the contract.

Orders