BP7 Pty Ltd v Gavancorp Pty Ltd - [2021] NSWSC 265

Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: BP7 Pty Ltd v Gavancorp Pty Ltd [2021] NSWSC 265
Hearing dates: 11 March 2021
Date of orders: 22 March 2021
Decision date: 22 March 2021
Jurisdiction: Equity
Before: Darke J
Decision:
Separate questions answered “Yes”, favourably to the cross-claimants.

Catchwords:
STATUTORY INTERPRETATION – meaning of “option to purchase” and “option granted for the purchase” in Division 9 of Part 4 of Conveyancing Act 1919 (NSW) – whether “option to purchase” includes put options – held that “option to purchase” should be construed as an option in the nature of a call option that gives holder or grantee the right to purchase property – “option granted for the purchase” has no wider meaning – statutory expressions given ordinary and natural meanings
LAND LAW – options – deeds of put and call option in respect of fourteen strata scheme lots – vendors granted call options to purchaser – purchaser granted put options to vendors – purchaser paid call option fee being 10% of the respective purchase prices – call option fee to be credited as deposit if any option is exercised – call options not exercised by purchaser – put options exercised by vendors – contracts for sale of land deemed to be entered into – purchaser subsequently rescinded contracts for sale relying upon statutory cooling off period – purchaser forfeits 0.25% of the respective purchase prices – whether purchaser is entitled to refund of call option fees less forfeited amount – where call option fees treated as deposits – held that the purchaser is entitled to refund of call option fees less 0.25% of the respective purchase prices – Conveyancing Act 1919 (NSW), s 66V

Legislation Cited:
Conveyancing (Sale of Land) Amendment Act 1990 (NSW)
Conveyancing (Sale of Land) Regulation 2017 (NSW), cl 13
Conveyancing Act 1919 (NSW), ss 66S, 66T, 66U, 66V, 66ZB, 66ZC, 66ZD, 66ZE

Cases Cited:
Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (Northern Territory) (2009) 239 CLR 27; [2009] HCA 41
C&P Syndicate Pty Ltd v Reddy (2013) 16 BPR 31,771; [2013] NSWSC 643
Certain Lloyd’s Underwriters v Cross (2012) 248 CLR 378; [2012] HCA 56
CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384
Dacco Pty Ltd v CV Crows Nest Fund Pty Ltd [2020] NSWSC 1550
Esso Australia Pty Ltd v Australian Worker’s Union (2017) 263 CLR 551; [2017] HCA 54
Evolution Living Property Management Pty Ltd v CSP Australia Pty Ltd [2010] NSWSC 65
Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28
Stevens v Kabushiki Kaisha Sony Computer Entertainment (2005) 224 CLR 193; [2005] HCA 58

Category: Principal judgment
Parties: BP7 Pty Ltd (Plaintiff)
Gavancorp Pty Limited (First Defendant/First Cross Claimant)
Robert Benjamin Besant (Second Defendant/Second Cross Claimant)
Lisa Ann Haxell (Third Defendant/Third Cross Claimant)
Simon Richard Powell (Fourth Defendant/Fourth Cross Claimant)
Louise Ellen Elizabeth Powell (Fifth Defendant/Fifth Cross Claimant)
Vicky Daniele (Sixth Defendant/Sixth Cross…

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: [2021] NSWSC 265
Decision Date: 22 March 2021

CaseChat Overview and Summary

BP7 Pty Ltd brought a claim against Gavancorp Pty Ltd in the Supreme Court of New South Wales regarding the interpretation of certain statutory terms within Division 9 of Part 4 of the Conveyancing Act 1919 (NSW). The dispute arose from a series of transactions involving options to purchase and options granted for the purchase of fourteen strata scheme lots. The central issue was whether the term "option to purchase" includes put options and what the term "option granted for the purchase" encompasses. Additionally, the case considered whether the purchaser was entitled to a refund of call option fees less a forfeited amount after rescinding the contracts for sale.

The court addressed the statutory interpretation of the terms "option to purchase" and "option granted for the purchase" within the context of the transactions. It held that "option to purchase" should be construed to mean an option in the nature of a call option, which grants the holder or grantee the right to purchase the property. The court found that "option granted for the purchase" does not have a wider meaning and should be given its ordinary and natural interpretation. The court concluded that the statutory expressions should not be extended beyond their ordinary meanings. The court also determined that when the call option fees are treated as deposits, the purchaser is entitled to a refund of these fees less the forfeited amount of 0.25% of the respective purchase prices.

In light of the statutory interpretation and the specific terms of the contracts, the court ruled that the purchaser is entitled to a refund of the call option fees less the forfeited amount. The court applied section 66V of the Conveyancing Act 1919 (NSW) to determine the outcome. The decision clarified the legal framework surrounding the interpretation of call and put options in the context of strata scheme lots and the respective rights and obligations of the parties involved.

Orders