Bruce v Baju Henley Square Pty Ltd

This case concerned an appeal from a decision of the Supreme Court of South Australia regarding a contract for the sale of an off-the-plan apartment. The appellant, Mr Bruce, had entered into a contract with the respondent developer, Baju Henley Square Pty Ltd, for the purchase of Lot 221 in a proposed apartment building. Mr Bruce sought to terminate the contract, alleging that the completed apartment was not of the area he had contracted to purchase. Baju, in turn, sought specific performance of the contract. The appeal focused on Mr Bruce's first notice of termination, which was based on an alleged breach of an area condition.

The central legal issues before the court were whether a concept drawing indicating an area of 130 square metres for Lot 221 formed part of the contract and was a promissory term, and if so, whether the actual constructed area of Lot 221 was less than that promised and exceeded any permitted variation tolerance. A further issue was the method by which the area of Lot 221 was to be calculated, with Mr Bruce advocating for the application of section 19(4) of the *Community Titles Act 1996* (SA) (the CTA method), and Baju arguing for the use of the Property Council of Australia Ltd guidelines (the PCA method).

The Full Court of the Supreme Court of South Australia, comprising Kourakis CJ, Blue and Hinton JJ, determined that the concept drawing was not of contractual effect and therefore not a promissory term. Furthermore, the court found that the method of determining the area contemplated by the contract was not the CTA method. The court also accepted Baju's argument that even if the CTA method were applicable, the area of Lot 221 did not exceed the variation tolerance. Consequently, the court concluded that Mr Bruce had not established a breach of contract that would justify his termination.

The appeal was dismissed. The court found that the trial judge had erred in concluding that any breach was insubstantial, but this error did not lead to a different outcome as the primary grounds of appeal were not established.