Carter v Mehmet

The case of *Carter v Mehmet* concerned a dispute arising from a contract for the sale of land. The purchasers, the respondents, raised requisitions on title, which the vendors, the appellants, contended were not properly made and that the vendors had adequately answered them. The purchasers subsequently purported to terminate the contract, alleging repudiation by the vendors. The vendors sought damages for breach of contract. The matter was heard in the Court of Appeal of New South Wales, with Meagher, Gleeson, and Payne JJA presiding.

The central legal issues before the Court of Appeal were whether the purchasers’ requisitions on title were properly made, whether the vendors had adequately responded to those requisitions, and whether the vendors’ conduct amounted to a repudiation of the contract. Specifically, the court had to consider whether the presence of Aboriginal objects on the land, as raised in the requisitions, constituted a defect in title or a material or substantial effect on the contract, particularly in light of existing development constraints. The court also had to determine if the vendors’ insistence on payment of default interest, based on an erroneous construction of the contract, amounted to a repudiation.

The Court of Appeal reasoned that the purchasers’ requisitions, while based on a plausible contention regarding the presence of Aboriginal objects, were not properly made as there were no Aboriginal objects on the land. Consequently, the presence of such objects did not constitute a defect in title or a material or substantial effect on the contract under the rule in *Flight v Booth*. The court found that the vendors had adequately answered the requisitions and had not evinced an intention no longer to be bound by the contract. Furthermore, the vendors’ insistence on default interest was based on an erroneous construction of the contract, but this alone did not amount to repudiation.

The Court of Appeal allowed the appeal, setting aside the orders of the primary judge. The court entered judgment for the appellants (vendors) against the respondents (purchasers) for a specified sum plus interest, and ordered that the respondents pay the appellants’ costs of the proceedings both at first instance and on appeal.