Catalano v Harofam Pty Ltd

[2012] VCC 1876

IN THE COUNTY COURT OF VICTORIA Revised
(Not) Restricted

AT MELBOURNE

COMMERCIAL LIST
GENERAL DIVISION

Case No. CI-12-05167

ROSA CATALANO	Plaintiff
v
HAROFAM PTY LTD	Defendant

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JUDGE:	His Honour Judge Anderson
WHERE HELD:	Melbourne
DATE OF HEARING:	29 November 2012
DATE OF JUDGMENT:	29 November 2012 (revised 30 November 2012)
CASE MAY BE CITED AS:	Catalano v. Harofam Pty Ltd
MEDIUM NEUTRAL CITATION:	[2012] VCC 1876

REASONS FOR JUDGMENT

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Catchwords: Sale of land – Plan of subdivision not registered during initial period specified in contract of sale – Defendant purported to extend the date – Plaintiff purported to terminate sale contract – Vendor-Purchaser summons for declaration and return of deposit – s. 9AE Sale of Land Act 1962 (Vic) – Solid Investments Australia Pty Ltd v Clifford (2010) 27 VR 41 and Allen v Harofam Pty Ltd/Scherman v Harofam Pty Ltd [2012] VSC 402 considered.

Practice and procedure – Adjournment application – Identical issues recently determined in the Supreme Court – Supreme Court decisions subject to appeal – Adjournment application refused.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr M. McKenzie	Robyn Calder Solicitors
For the Defendant	Mr G. Bloch	Fixler & Associates

HIS HONOUR:

1The defendant has applied for an adjournment of the hearing of a summons on an originating motion, which is before the Court today. The originating motion seeks relief pursuant to section 49(1) of the Property Law Act 1958 (Vic) in the form of the return of a deposit and a declaration that a contract of sale has been validly rescinded.

2The plaintiff purchased land on a subdivision where the plan of subdivision had not been registered. The plaintiff purported to rescind the contract when, after a period of time, the plan of subdivision remained unregistered.

3Similar issues have recently been determined in relation to other lots on the same plan of subdivision by Warren CJ in the decisions of Allen v Harofam Pty Ltd and Scherman v Harofam Pty Ltd [2012] VSC 402 where the Chief Justice followed the decision of the Court of Appeal in Solid Investments Australia Pty Ltd v Clifford [2010] 27 VR 41.

4The defendant seeks an adjournment of the present application on the following bases:

a.it has appealed the decisions of the Chief Justice and submits that no decision should be made in the present case until those appeals are determined;

b.alternatively, the matter should be adjourned so that application can be made to transfer this proceeding to the Supreme Court;

c.the application should be adjourned so that Senior Counsel can appear before the Court to argue the application on the defendant’s behalf.

5The defendant at 6:37pm on 28 November 2012, made an open offer to the plaintiff effectively offering that if the present application were adjourned that the defendant would return the plaintiff’s deposit without prejudice to the defendant’s right to contend that the plaintiff is bound to complete the contract in the event that the defendant succeeds in the appeals from the decisions of the Chief Justice. The defendant also offered to pay the plaintiff’s costs of the day and costs thrown away by reason of the adjournment.

6There was argument about two matters:

a.whether a County Court Judge would be bound by the decisions of the Chief Justice which, I was informed, relied upon fact situations which were entirely identical with the present application; and

b.if a decision were reached consistent with the decisions of Warren CJ, whether or not I considered myself bound by her decisions or simply followed them as a matter of comity, that the plaintiff may be able to argue on appeal that although the Chief Justice might have been wrong in law, that nevertheless, my decision would be correct in law, and therefore unappealable, because my decision was consistent with the decision of the Chief Justice.

7In the course of discussion about the second issue, Mr McKenzie of counsel, who appeared for the plaintiff, was prepared to unequivocally agree with a proposition drafted by Mr Bloch, of counsel, for the defendant that no such argument would be advanced or relied upon by his client.

8The plaintiff wishes to contend that if she were permitted to proceed with her application, and if the application were successful, she should be awarded her costs of the application and those costs should be ordered to be paid on an indemnity basis. Those costs, whether on an indemnity basis or not, would go beyond the costs presently offered by the defendant of the plaintiff’s costs of the day and any costs thrown away by reason of the adjournment sought. There is a marginal difference between what is offered and what the plaintiff might be entitled to if the application proceeds.

9I consider in the circumstances that I should refuse the application for an adjournment. The matter is properly before me, it is convenient for the Court to hear the application today and there is time to do so, rather than adjourning it to another day during December, although that might suit the availability of the defendant’s senior counsel, as the workload of the Commercial List Duty Judge during the month of December will be extremely heavy.

10I consider also that the defendant would not give up any rights it might have to appeal from any decision I might make unfavourable to it, or if the Court of Appeal were to decide that the Chief Justice had been in error, to contend that the application of the correct principles of law to this case should require the plaintiff to complete her contract. In the circumstances, I will now proceed with the application.

11Having heard the application, it is apparent that:

a.the contractual provisions considered by the Chief Justice are precisely the same as in the present application;

b.effectively, the circumstances in which the purchasers sought to rescind their contracts are the same.

12The defendant’s submission is that the Chief Justice was wrong in law because the contractual provisions in the cases before her were significantly different from the contractual provisions in the decision of Clifford v Solid Investments Australia Pty Ltd.

13In the cases before the Chief Justice, and in the present case, the time for completion could not have been extended beyond 24 months, together with a further period of not more than 6 months if the vendor chose to extend the initial period and the circumstances set out in the contract so permitted. In Clifford, the specific period of time set out in the relevant clause could be extended for indefinite periods on a number of occasions by the unilateral act of the vendor. These arguments were considered and rejected by the Chief Justice in a reserved decision.

14There may be an argument that judges sitting at first instance in the County Court are not necessarily bound to following decisions of judges sitting at first instance in the Supreme Court. Despite counsel’s limited research, no statement of authority in support of that principle has been found. The general position is the statement  of “the modern English rule” adopted by Gibbs J in Viro v The Queen (1978) 141 CLR 88 at 120 as the appropriate statement of the Australian position, that, “Every court is bound to follow any case decided by a court above it in the hierarchy”.

15In the circumstances of the present application, I consider that there is no basis for me to decline to follow the decision on the matter of law determined by the Chief Justice after reserving decisions in the two cases argued before her. Accordingly, I will follow the decisions of the Chief Justice and the result in the present application will be the same as the result in the cases before her.

16The orders I propose to make are as follows:

1.The requirements of rules 5.03(1) and 8.02 are dispensed with and the plaintiff is authorised to commence the proceeding by originating motion in Form 5C.

2.I declare pursuant to section 49(1) of the Property Law Act 1958 (Vic) that the contract dated 20 June 2010 (“the Contract”) for the sale of the land known as Lot 35, 219-221 East Boundary Road, East Bentleigh (“the Property”) between the plaintiff as purchaser and the defendant as vendor has been rescinded pursuant to special condition 10.3 of the Contract.

3.Pursuant to section 49(2) of the Property Law Act 1958 (Vic) the defendant must repay to the plaintiff the deposit of $64,500 paid under the Contract.

4.The defendant must pay to the plaintiff the costs of the proceeding including any reserved costs to be taxed in default of agreement.

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Certificate

I certify that these 4 pages are a true copy of the reasons for decision of His Honour Judge Anderson delivered on 29 November 2012 and revised on 30 November 2012.

Dated: 30 November 2012

Catherine Kusiak

Associate to His Honour Judge Anderson