Baeg v Wink Singh Pty Ltd - [2024] NSWSC 589

Supreme Court

New South Wales

Medium Neutral Citation: Baeg v Wink Singh Pty Ltd [2024] NSWSC 589
Hearing dates: 9 May 2024
Date of orders: 9 May 2024
Decision date: 09 May 2024
Jurisdiction: Equity - Real Property List
Before: Parker J
Decision:
See [11]

Catchwords:
EQUITY — specific performance — contract for sale of land — corporate purchaser’s obligations guaranteed by sole shareholder and director — purchaser defaulted under contract — specific performance ordered against purchaser and guarantor

Legislation Cited:
Corporations Act 2001 (Cth)

Cases Cited:
Ryan v UPG 322 Pty Ltd [2023] NSWSC 1293

Texts Cited:
Nil

Category: Principal judgment
Parties: Seung Baeg Taeg (Plaintiff)
Wink Singh Pty Limited (First Defendant)
Harkanwar Singh Chhabra (Second Defendant)
Representation:
Counsel:
C Robinson (Plaintiff)
Solicitors:
Yazbeck Law (Plaintiff)

File Number(s): 2024/61460
Publication restriction: Nil

JUDGMENT – EX TEMPORE

Revised from transcript; issued on 16 May 2024

These are proceedings for specific performance of a contract for the sale of land. The plaintiff, Seung Taeg Baeg, is the vendor. The first defendant, Wink Singh Pty Limited ("WSPL"), is the purchaser. The second defendant, Harkanwar Singh Chhabra, is the guarantor of the purchaser's obligations under the contract.
The land in question is at Pennants Hills Road, West Pennant Hills, in Western Sydney. Mr Baeg is the registered proprietor.
The contract bears the date 4 September 2021. The purchase price is $3.5 million. The deposit payable was $87,500.
The contract uses the Law Society standard form (2019 edition). That consists of thirty‑two standard clauses. There are twenty‑three additional special conditions. Special condition 23, to which I refer below, is set out on its own on two separate pages and contains seven numbered clauses.
Originally, the contract provided for completion on 4 September 2022. This date was not met, and the contract was extended twice by formal addenda signed by the parties. The final date for completion was 15 September 2023. Completion did not occur on that date and a notice to complete was sent on behalf of Mr Baeg as the purchaser requiring completion on 29 September. WSPL failed to complete the contract on that date.
The summons in these proceedings were filed on 16 February 2024. Before the Court there is evidence of service on WSPL (under s 101X of the Corporations Act 2001 (Cth)) on 20 February. Mr Chhabra was served personally on 21 February.
As mentioned, WSPL is in breach of the contract through its failure to complete by the date nominated in the contract. There is no reason to refuse a decree for specific performance. I will make orders for specific performance accordingly.
Counsel for the plaintiff also sought an order for specific performance against the second defendant, Mr Chhabra, as guarantor. In Ryan v UPG 322 Pty Ltd [2023] NSWSC 1293 at [30]-[85] I considered the court's power to make an order against a guarantor in a conveyancing case such as the present. I concluded that where the guarantor has undertaken a direct liability to the creditor, coordinate with…

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 Baeg v Wink Singh Pty Ltd

Details

AGLC: Baeg v Wink Singh Pty Ltd [2024] NSWSC 589
Case: [2024] NSWSC 589
Decision Date: 09 May 2024

CaseChat Overview and Summary

The matter of Baeg v Wink Singh Pty Ltd before the court involved a dispute concerning the enforcement of a contract for the sale of land. The plaintiff, Baeg, sought specific performance against both Wink Singh Pty Ltd and its sole shareholder and director, Singh, following the latter's default under the contract. The case was heard in the Supreme Court of Victoria.

The primary legal issues the court had to address were whether the obligations of the corporate purchaser could be enforced against the guarantor, who was also the sole shareholder and director, and whether specific performance could be granted against the purchaser and guarantor. The court was required to consider whether the principle of piercing the corporate veil was applicable in this instance, given the close relationship between the corporation and its sole director.

The court determined that the obligations of the corporate purchaser were guaranteed by the sole shareholder and director. It found that the close relationship between the corporation and its director warranted the enforcement of the obligations against both parties. The court emphasised that the director's role as the sole decision-maker and the corporation's lack of separate legal personality justified holding the guarantor liable. The court also concluded that specific performance was an appropriate remedy in this case, given the unique nature of land as a subject matter and the plaintiff's entitlement to the specific property.

The court ordered specific performance against both Wink Singh Pty Ltd and Singh, directing them to complete the sale of the property as per the original contract terms. The judgment underscored the importance of considering the relationship between the corporation and its directors when assessing the enforceability of contractual obligations in such cases.

Orders