Deligiannidou v Sundarjee - [2020] NSWSC 437

Supreme Court

New South Wales

Medium Neutral Citation: Deligiannidou v Sundarjee [2020] NSWSC 437
Hearing dates: 22 April 2020
Date of orders: 22 April 2020
Decision date: 23 April 2020
Before: Stevenson J
Decision:
Application for interim relief refused

Catchwords: CONTRACTS – CONTRACT FOR SALE OF LAND – deposit – where contract provided for payment of deposit by cheque – where agent by email directed vendors to pay deposit by EFT to its trust account – where fraudster send subsequent email to vendors directing payment to a different account – deposit evidently lost – whether agent acting as vendor’s agent for this purpose – whether relevant authority conferred on agent by term on the agency agreement
Legislation Cited: Competition and Consumer Act 2010 (Cth), Schedule 2 – The Australian Consumer Law
Cases Cited: Markson v Cutler [2007] NSWSC 1515
Category: Procedural and other rulings
Parties: Efthalia Deligiannidou (First Plaintiff)
Patrick Thomas Sven Holmes (Second Plaintiff)
Hasmukh Sundarjee (First Defendant)
Jesal Sundarjee (Second Defendant)
Sans Souci Developments Pty Ltd t/as Caruana Real Estate (Third Defendant)
Representation:
Counsel:
D Flaherty (Plaintiffs)
R Yezerski (First and Second Defendants)
J Ferguson (Third Defendant)
Solicitors:
Mullick & Associates (Plaintiff)
Pigott Stinson (First and Second Defendants)
Coleman Greig Lawyers (Third Defendant)

File Number(s): 2020/106801

Judgment

On 1 February 2020 the plaintiffs (“the Purchasers”) exchanged contracts (“the Contract”) with the first and second defendants (“the Vendors”) to purchase a property at Sans Souci for $560,000.
On 19 March 2020 the Vendors purported to terminate the Contract on the basis that the deposit called for by the Contract had not been paid by the time specified in the Contract.
On 22 April 2020 I refused to grant the Purchasers interim relief restraining the Vendors from dealing with the property.
These are my reasons for refusing the Purchasers that relief.
It was a term of the Contract that a 10% deposit ($56,000) be paid. The deposit was to be paid as to an initial holding deposit of $1,400 by 1 February 2020 and as to the balance of $54,600 by 12 February 2020.
The Contract required that the deposit be paid by either cash (up to $2,000) or by cheque. The Contract did not permit payment of the deposit by electronic funds transfer (“EFT”).
The agent on the sale (“the Agent”) was the third defendant, Sans Souci Developments Pty Ltd, trading as Caruana Real Estate.
On 31 January 2020, Ms Kathy Caruana, a representative of the Agent, sent the first plaintiff, Ms Deligiannidou an email suggesting that if she wished to secure “the property on a five day cooling off period so no other offers can be taken” she pay the initial holding deposit of $1,400 deposit into Agent’s trust account (“the Trust Account”). Ms Casuara provided the BSB and account numbers for the Trust Account. Ms Deligiannidou caused $1,400 to be paid by EFT to the Trust Account.
On 7 February 2020, and despite the fact that the Contract did not provide for the payment of the deposit…

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.

Continue reading Deligiannidou v Sundarjee

Details

AGLC: Deligiannidou v Sundarjee [2020] NSWSC 437
Case: [2020] NSWSC 437
Decision Date: 23 April 2020

CaseChat Overview and Summary

The case of Deligiannidou v Sundarjee involved a dispute over a contract for the sale of land, specifically focusing on the payment of a deposit. The parties to the case were Deligiannidou, the purchaser, and Sundarjee, the vendor, represented by an agent. The central issue was whether the agent had the authority to direct the vendor to pay the deposit in a manner that ultimately resulted in the deposit being lost due to a fraudulent instruction. The court was required to determine whether the agent was acting as the vendor's agent in directing the payment of the deposit, and whether this authority was conferred by the terms of the agency agreement.

The court considered the terms of the agency agreement and the conduct of the parties to ascertain the scope of the agent's authority. It examined whether the agent had the authority to make decisions regarding the payment of the deposit and whether this authority was explicitly or implicitly conferred by the agency agreement. The court also assessed the implications of the agent's email and the subsequent fraudulent email on the validity of the payment instruction. The decision hinged on interpreting the agency agreement and determining the extent of the agent's authority in directing the payment of the deposit.

The court found that the agent did not have the authority to direct the payment of the deposit in a manner that resulted in its loss due to fraud. The agency agreement did not confer the necessary authority on the agent for this specific purpose. Consequently, the court ruled that the agent's direction to pay the deposit by EFT to its trust account was not valid, and the subsequent fraudulent instruction did not constitute a valid payment method. The court held that the agent's authority was limited to the terms explicitly stated in the agency agreement, and any deviation from these terms without explicit authorisation constituted an unauthorised act.

The court ordered that the contract for the sale of land would proceed without the lost deposit, with further orders to be determined based on the parties' negotiations or additional court direction. The court's decision emphasised the importance of clear terms in agency agreements and the limitations on an agent's authority to direct critical financial transactions such as the payment of deposits in real estate contracts.

Orders