Bajwa Group Pty Ltd v Sharma - [2024] VSC 195

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

PROPERTY LIST

S ECI 2022 03418

BAJWA GROUP PTY LTD (ACN 601 030 611)	Plaintiff
v
BAHVNA SHARMA & ORS (according to the schedule attached)	Defendants

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JUDGE:	McDonald J
WHERE HELD:	Melbourne
DATE OF HEARING:	27 February to 29 February 2024
DATE OF JUDGMENT:	24 April 2024
CASE MAY BE CITED AS:	Bajwa Group Pty Ltd v Sharma & Ors
MEDIUM NEUTRAL CITATION:	[2024] VSC 195

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CONTRACT – Formation – Sale of land – Letter of offer – Agreement to enter formal contract in accordance with terms of letter of offer – Purchaser permitted to provide another entity to enter contract – No vendor’s statement provided – Renegotiation of purchase price subsequent to signing letter of offer – Significant terms not addressed in letter of offer – Letter of offer not a binding and enforceable contract – Sale of Land Act 1962, s 32.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr W Rimmer	Local Lawyers
For the Defendants	Mr CR Northrop	ATK Partners

HIS HONOUR:

Introduction

Since February 2022 the defendants have been the registered proprietors of land at 387 Greigs Road, Truganina (‘the land’). The land is approximately 28.6 acres. Gurpeet Bajwa is the sole director and shareholder of the plaintiff. The plaintiff has been in the business of property development since 2014.

The key issue in the present proceedings is whether a document titled ‘letter of offer’ (‘the letter’) signed by the plaintiff and the defendants and dated 11 April 2022 is a binding and specifically enforceable contract for the sale of the land for a purchase price of $17.5 million. The plaintiff contends that the letter is a binding contract and seeks orders to specifically enforce the contract. The defendants contend that the letter is not a binding contract.

I have concluded that the letter is not a binding contract. The text of the document construed in the circumstances in which it came into existence together with the matters which the letter did not address, are such that a reasonable person would have believed that the parties did not intend that the letter would constitute a binding contract.

Background

In late March 2022 Mr Bajwa was contacted by Rajbir Braich, a real estate agent employed by Raine and Horne. Mr Braich told Mr Bajwa that a parcel of land in Greigs Road, Truganina was coming on the market. Mr Bajwa subsequently inspected the land. He considered that the land had very good road connectivity because it was very close to the Western Highway.[1] Mr Bajwa contacted Mr Braich and told him that he was interested in purchasing the land.[2]
[1]Transcript of proceedings (‘T’) 27 February 2024, T 75 L 4–7.
[2]T 74 L 26–31.

On 1 April 2022 the third and fourth defendants, Rita and Krishan Aggarwal, found a note from Mr Braich on the front door of their residence. In the note Mr Braich introduced himself, provided contact details…

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: [2024] VSC 195
Decision Date: 24 April 2024

CaseChat Overview and Summary

The case of Bajwa Group Pty Ltd v Sharma involved a dispute over the sale of land. The plaintiff, Bajwa Group, sought to enforce a purported contract for the sale of land based on a letter of offer. The defendants, Sharma, argued that the letter of offer did not constitute a binding contract and that the parties had not reached a final agreement on the terms of the sale. The case was heard in the Supreme Court of Victoria.

The primary legal issue the court had to decide was whether the letter of offer constituted a binding and enforceable contract under the Sale of Land Act 1962. The court also had to determine whether the subsequent renegotiation of the purchase price and the lack of a vendor’s statement rendered the letter of offer unenforceable. Additionally, the court considered whether significant terms not addressed in the letter of offer could still form part of a binding contract.

The court held that the letter of offer did not constitute a binding and enforceable contract. The letter permitted the purchaser to provide another entity to enter the formal contract, and there was no vendor’s statement provided. Furthermore, the renegotiation of the purchase price and the absence of a vendor’s statement meant that the terms were not finalised. The court also noted that significant terms were not addressed in the letter of offer, which was required for the contract to be enforceable under the Sale of Land Act 1962. Consequently, the court found that the letter of offer did not create a binding and enforceable contract.

The court ordered that the defendants were not bound by the terms of the letter of offer and that no contract for the sale of land had been formed. The court also found that the plaintiff’s claim for specific performance and damages was dismissed.

Orders