Best Price Real Estate Pty Ltd v Equity 2 Pty Ltd

The Court of Appeal heard an appeal by Equity 2 Pty Ltd (the respondent) against an order made by the District Court of Queensland in favour of Best Price Real Estate Pty Ltd (the applicant). The applicant had sought summary judgment in a contractual dispute regarding a conjunction agreement between the parties. The District Court granted the applicant summary judgment, struck out the respondent’s defence, and ordered costs. The respondent appealed the District Court’s decision, arguing that the court should not have made the order for summary judgment and should have allowed the respondent to replead its defence. The appeal centred on the procedural matters of the application for summary judgment and the striking out of the respondent’s defence, as well as the substantive issue of whether there was an implied term of good faith in the conjunction agreement.

The court considered whether the District Court erred in granting summary judgment to the applicant without leave to the respondent to replead its defence. The court held that the District Court should not have made the order for summary judgment because there was an outstanding issue to be decided, namely, whether there was an implied term of good faith in the conjunction agreement. The court also found that the District Court should have given the respondent leave to replead its defence, as there was a possibility that the respondent could raise an arguable defence. The court held that the District Court should have considered whether the respondent’s defence disclosed a reasonable cause of action before striking it out.

The Court of Appeal allowed the appeal, set aside the orders made by the District Court, and dismissed the applicant’s application for summary judgment. The court found that the District Court had erred in making the order for summary judgment and in striking out the respondent’s defence without leave to replead. The court ordered the parties to provide written submissions as to the costs of the application and the appeal. The court held that the District Court’s error in making the order for summary judgment and striking out the respondent’s defence without leave to replead was a serious procedural error that warranted the setting aside of the orders and the dismissal of the applicant’s application for summary judgment.