Curtain & Anor v Kirk & Anor

The plaintiffs, Curtain and another, brought an action against the defendants, Kirk and another, in relation to a unit that the plaintiffs owned and agreed to sell to the defendants. The settlement of the sale was to take place a year and a day later, but the defendants took possession of the unit in advance of settlement in accordance with the special conditions of the contract. The defendants purported to rescind and terminate the contract, claiming that the plaintiffs breached the contract by not giving them written notice that the particulars of the unit were recorded in the Environmental Management Register, as required by section 421 of the Environmental Protection Act 1994 (EPA). The plaintiffs argued that the defendants' purported termination was unlawful and a repudiation of the contract, which the plaintiffs accepted, terminating the contract. The defendants also argued that the plaintiffs breached a warranty under the sale contract that they were not aware of any facts or circumstances that may lead to the land being classified as contaminated land within the meaning of the EPA. The court was required to decide whether the unit was on the EPA at the time of the sale to the defendants, whether the plaintiffs were aware of that fact, whether the defendants had entered into possession before purporting to rescind, whether the defendants' purported rescission was valid, and whether section 421 afforded the defendants a privately actionable right to damages where there had been a breach of the section.

The court held that the unit was on the EPA at the time of the sale to the defendants, but the plaintiffs were not aware of that fact. The court also held that the defendants had entered into possession before purporting to rescind, and their purported rescission was not valid. The court found that the defendants were not entitled to rescind the contract because material facts (the existence of the EPA listing and the existence of the facts that led to that listing) were not disclosed to them, which, if they had been disclosed, would have changed their decision to enter into the contract in the first place. The court held that the plaintiffs were not aware of the material facts, and the defendants would not have entered into the contract had the material facts been disclosed. However, the court found that the defendants had waived any right to rescission in equity by conduct in April 2010. The court held that the defendants' conduct, viewed objectively, was consistent with exercising a right to press the contract to completion and abide by its terms over exercising a right to rescind or terminate.

The court held that the plaintiffs were entitled to judgment against the defendants for $635,798 together with interest. The court ordered that the parties will be heard as to the amount of interest and costs.