Caruso v Newington Road Developments Pty Ltd - [2024] ACTSC 22

SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

Case Title:	Caruso v Newington Road Developments Pty Ltd
Citation:	[2024] ACTSC 22
Hearing Date:	23 October 2023, 24 October 2023
Decision Date:	8 February 2024
Before:	Taylor J
Decision:	See [54].
Catchwords:	CONTRACTS – FORMATION – Collateral Contract – Holding deposit – alleged breach of collateral contract by a failure to provide a further written contract for sale – claim for damages
Cases Cited:	Adicho v Dankeith Homes Pty Ltd [2012] NSWCA 316 Air Great Lakes Pty Ltd v KS Easter (Holdings) Pty Ltd (1985) 2 NSWLR 309 Allen v Carbone (1975) 132 CLR 528 Brooks v Commissioner of Taxation [2000] FCA 721; 100 FCR 117 Cordon Investments Pty Ltd v Lesdor Properties Pty Ltd [2012] NSWCA 184 Commissioner of Taxation v Guy (1996) FCA 438; 67 FCR 68 Crown Melbourne Ltd v Cosmopolitan Hotel (Vic) Pty Ltd (2016) 260 CLR 1 Godecke v Kirwan (1973) 129 CLR 629 GR Securities Pty Ltd v Baulkham Hills Private Hospital Pty Ltd (1986) 40 NSWLR 631 Heilbut, Symons & Co v Buckleton [1913] AC 30 Hospital Products Ltd v United States Surgical Corporation(1984) 156 CLR 41; 55 ALR 417 Hoyt's Pty Ltd v Spencer [1919] HCA 64; 27 CLR 133 Kean v Dunfoy [1952] NZLR 611 LG Thorne & Co Pty Ltd v Thomas Borthwick & Sons (Australasia) Ltd (1955) 56 SR (NSW) 81 Maybury v Atlantic v Atlantic Union Oil Co Ltd [1953] HCA 89; 89 CLR 507 Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451 Smythe v Thomas (2007) 71 NSWLR 537 Stellar Vision Operations v Hills Health Solutions Pty Ltd [2023] NSWCA 102
Texts Cited:	P Butt, Conveyancing and property: Status of a “holding deposit” (2010) 84 ALJ 12 P Butt, The Standard Contact for Sale of Land in New South Wales (Law Book Co, 1985) R.M. Stonham, The Law of Vendor and Purchaser (Law Book Company of Australasia, 1964)
Parties:	Frank Caruso ( Plaintiff) Newington Road Developments Pty Ltd (ACN 646 345 002) ( Defendant)
Representation:	Counsel W.D.B. Buckland ( Plaintiff) J Larkings ( Defendant)
Solicitors United Legal ( Plaintiff) Lexmerca ( Defendant)
File Number:	SC 361 of 2022

TAYLOR J:

Introduction

1․The plaintiff, Mr Frank Caruso, claims the defendant company, Newington Road Developments Pty Ltd, breached a contract made between them in November 2021. The defendant company is a land developer. The contract, said by the plaintiff to exist, concerned a piece of land in Bywong, New South Wales (NSW). In November 2021 the plaintiff made an offer of $835,000 to purchase a lot of land to be developed by the defendant. The offer was ‘accepted’ via an email sent by the defendant’s real estate agent. As will become clear, this email is critical to the plaintiff’s case. The defendant denies the creation of any contract between the parties. The lot of land was ultimately sold by the defendant to someone other than the plaintiff in July 2022.

Background

2․Mr Gerard Littlewood…

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] ACTSC 22
Decision Date: 8 February 2024

CaseChat Overview and Summary

In Caruso v Newington Road Developments Pty Ltd, Caruso, a prospective purchaser, sued Newington Road Developments (NRD), a property developer, for breach of a collateral contract. Caruso alleged that NRD had promised to provide a written contract for sale if he paid a holding deposit. Caruso paid the deposit but did not receive the promised written contract, leading to his claim for damages. The case was heard by the Supreme Court of New South Wales.

The primary legal issue before the court was whether a collateral contract existed between Caruso and NRD. Caruso argued that NRD had promised to provide a written contract for sale if he paid the deposit. The court needed to determine if this promise constituted a collateral contract and if NRD had breached it by failing to deliver the promised written contract. The court also had to consider the enforceability of the collateral contract and the appropriate measure of damages if a breach was found.

The court found that a collateral contract existed between Caruso and NRD. The court held that NRD had indeed promised to provide a written contract for sale if Caruso paid the deposit, and this promise was a collateral contract. The court found that NRD had breached the collateral contract by failing to deliver the promised written contract. However, the court noted that Caruso had not suffered any loss as a result of the breach, as he had already paid the holding deposit and was not entitled to any damages. The court dismissed Caruso's claim for damages.

The court ordered that Caruso's claim for damages be dismissed and that each party bear their own costs of the proceedings.

Orders

Orders of the court

See [54].

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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