DGF Property Holdings Pty Limited v Di Federico; DGF Property Holdings Pty Limited v Butros - [2018] NSWSC 344

Supreme Court

New South Wales

Medium Neutral Citation: DGF Property Holdings Pty Limited v Di Federico; DGF Property Holdings Pty Limited v Butros [2018] NSWSC 344
Hearing dates: 20, 21, 22, 23, 24 November 2017; Submissions 12 March 2018
Decision date: 23 March 2018
Jurisdiction: Equity
Before: Emmett AJA
Decision:
1.   The plaintiff (DGF) notify the Court and the defendants in proceedings 2015/105403 (the Di Federicos) in writing within 14 days of its calculation of the amount of damages in accordance with the reasons published today.
2.   The Di Federicos notify the Court and DGF in writing within 14 days after receipt of such notification whether they wish to dispute that the calculation of such damages has been made in accordance with the reasons.
3.   DGF notify the Court and each of the First to the Fifteenth Defendants in proceedings 2016/246532 (the Purchasers) in writing within 14 days whether it proposes to proffer an undertaking to the Court along the lines indicated in the reasons published today.
4.   Each party notify all other parties within 14 days whether that party wishes to make any submissions in relation to:
(i) costs and the apportionment of costs as between proceedings 2016/246532 and proceedings 2015/105403;
(ii) the appropriate rate for the adjustment of the purchase price; and
(iii) the period for which the rate should be applied.
5.   Both proceedings be listed for further directions on a date convenient to the parties and the Court for the purpose of making further orders for the progress and final disposition of both proceedings.

Catchwords: REAL PROPERTY – vendor sought rescission of eight off the plan contracts – vendor applied under s 66ZL of the Conveyancing Act 1919 for orders permitting rescission in the absence of purchaser consent – whether right to rescind arose – whether vendor had lost right to rescind by failing to exercise right to rescind at an earlier time – whether court should exercise discretion to permit vendor to exercise contractual right to rescind – whether vendor satisfied the Court that making orders permitting rescission would be just and equitable in all the circumstances
Legislation Cited: Conveyancing Act 1919 (NSW)
Water Management Act 2000 (NSW)
Cases Cited: Al Achrafi v Topic [2016] NSWSC 1807
Immer (No 1450) Pty Ltd v Uniting Church of Australia Property Trust 182 CLR 26
New Zealand Shipping Co v Société des Ateliers et Chantiers de France [1919] AC 1
Sargent v ASL Developments Limited (1974) 131 CLR 364
Suttor v Gundowda Pty Ltd (1950) 81 CLR 418
Texts Cited: Handley: Estoppel by Conduct and Election (Sweet and Maxwell, 2016, 2nd ed)
Category: Principal judgment
Parties:
In Matter No 2015/105403
DGF Property Holdings Pty Limited (Plaintiff and First Cross Defendant)
Enzo Di Federico (First Defendant and First Cross Claimant)
Franca Di Federico (Second Defendant and Second Cross Claimant)
In Matter No 2016/246532
DGF Property Holdings Pty Limited (Plaintiff)
Marianna Butros (First Defendant)
Bolos Butros (Second Defendant)
Peter Alec Noble (Third Defendant)
Diane Cecelia Noble (Fourth Defendant)
Zafer Okan (Fifth Defendant)
Nuran Okan (Sixth Defendant)
Joe Pijaca (Seventh Defendant)
Gloria Pijaca (Eighth Defendant)
Samantha Nicole Gina Panuccio (Ninth Defendant)
Mark Anthony Azzopardi (Tenth Defendant)
Raquel Azzopardi (Eleventh Defendant)
Stiven Mihajlovic (Twelfth Defendant)
Linda Maria Mihajlovic (Thirteenth Defendant)
Michael Scarvelis (Fourteenth Defendant)
Tanya-Marie Scarvelis (Fifteenth Defendant)
Enzo Di Federico (Sixteenth Defendant)
Franca Di Federico (Seventeenth Defendant)
Representation:
Counsel:
In Matter No 2015/105403
G Sirtes SC with Mr PM Barham (Plaintiff)
MA Ashhurst SC with D S Weinberger (First and Second Defendants)

In Matter No 2016/246532
G Sirtes SC with PM Barham (Plaintiff)
JC Giles SC with H Mann (First to Eighth; Tenth to Fifteenth Defendants)
Mr D Allen (Ninth Defendant)
MA Ashhurst SC with David S Weinberger (Sixteenth and Seventeenth Defendants)

Solicitors:
In Matter No 2015/105403
Simone Legal (Plaintiff)
Mills Oakley (First and Second Defendants)
In Matter No 2016/246532
Simone Legal (Plaintiff)
Dentons (First to Eighth; Tenth to Fifteenth Defendants)
Russo & Partners (Ninth Defendant)
Mills Oakley (Sixteenth and Seventeenth Defendants)

File Number(s): 2015/105403; 2016/246532

Judgment

Object of s 66ZL
Scheme of s 66ZL
DGF
The History of the Proposed Subdivision
DGF’s Claims against the Di Federicos
Cross claim by the Di Federicos
Terms of the Contracts for Sale
The Rescission Proceedings
Whether Right to Rescind Arose
Breach of special condition 42.5 and cl 28.2.3
December 2013 to May 2014
May 2014 to October 2014
October 2014 to March 2015
March 2015 to October 2015
After 22 October 2015
Conclusion on Breach of Special Condition 42.5

Election

Construction of s 66ZL
The Criteria in s 66ZL(7)
Section 66ZL(7)(a): the Terms of the Contracts
Section 66ZL(7)(b): Whether DGF Acted Unreasonably or in Bad Faith
Section 66ZL(7)(c): Reasons for Delay
Section 66ZL(7)(d): Likely Date for Creation of Subject Lots
Section 66ZL(7)(e): Whether the Subject Lots have Increased in Value
Section 66ZL(7)(f): Effect of Rescission on the Purchasers
Pijaca
Panuccio
Butros
Scarvelis
Mihajlovic
Noble
Okan
Azzopardi

Section 66ZL(7)(g): Any other Relevant Matter

Conclusion as to “Just and Equitable”
Costs
Orders
Appendix 1
Appendix 2

Judgment

Each of these two proceedings is concerned with a proposed subdivision of land situated at Horsley Park, New South Wales being undertaken by DGF Property Holdings Pty Limited (DGF), the plaintiff in both proceedings. The defendants in proceedings 105403 of 2015 (the Specific Performance Proceedings) are Mr Enzo Di Federico and Mrs Franca Di Federico (together the Di Federicos), who owned part of the land in the proposed subdivision and will be the owners of two of the lots in the proposed subdivision. The defendants in proceedings 246532 of 2016 (the Rescission Proceedings) are persons (the Purchasers) who have entered into eight separate contracts with DGF for the purchase of lots in the proposed subdivision (the Contracts for Sale). The Di Federicos are also defendants in the Rescission Proceedings.
In the Specific Performance Proceedings, DGF claims damages from the Di Federicos on the basis that have acted in breach of a deed made between DGF and the Di Federicos on 17 December 2013 (the 2013 Deed) and an agreement made between DGF and the Di Federicos on 22 October 2015 (the 2015 Agreement). Each of the 2013 Deed and the 2015 Agreement was entered into in order to resolve disputes between DGF and the Di Federicos in connection with the proposed subdivision.
Each of the Contracts for Sale contained a clause entitling each party to rescind it if the subject lot was not created by a date set out in the contract as the latest date by which the subject lot must be created (the sunset date). A relevant effect of s 66ZL of the Conveyancing Act 1919 (NSW) (the Conveyancing Act) is that, despite such express contractual provisions, DGF may not rescind any of the Contracts for Sale unless it has obtained an order of the Court permitting it to do so. In the Rescission Proceedings, DGF asks the Court to make orders under s 66ZL permitting it to rescind each of the eight Contracts for Sale.
Section 66ZL was inserted into the Conveyancing Act by the Conveyancing Amendment (Sunset Clauses) Act 2015 (NSW) (the Amending Act). It had retrospective effect on the Contracts for Sale and the rights of the parties thereunder. Accordingly, before dealing with the scheme of s 66ZL, it is desirable to say something about the object of the amendment.

Object of s 66ZL [1]

1. NSW, Parliamentary Debates, Legislative Assembly, 10 November 2015, 5560 (Victor Dominello).

In the Minister’s speech on the second reading of the Conveyancing Amendment (Sunset Clauses) Bill 2015, pursuant to which s 66ZL was inserted into the Conveyancing Act (the Second Reading Speech), the Minister began by observing that an increase in demand for housing, particularly in Sydney, in the previous four years had caused a marked rise in the number of off the plan contracts, whereby land can be sold before the developer has finished constructing roads and installing services, or a strata unit can be sold before the strata plan is drawn, approved and registered. He observed that, in those cases, the purchaser is not buying an asset that can be seen and inspected but is buying an idea that relies on the terms of the contract and the goodwill and expertise of the developer to complete. To guarantee the sale, the purchaser will pay a deposit and then wait for the land to be developed or the units to be constructed.
The Minister said that an important feature of most such contracts is “the sunset clause”, which allows either the vendor or purchaser to rescind or terminate contractual obligations if the development is not completed by a specified date. Such a clause has important benefits for both parties, in that it prevents a purchaser being tied to the contract indefinitely and allows a developer to end the arrangement if the developer cannot proceed due to factors beyond the control of the developer. The Minister said, however, that the rise in the property market had seen increased reports of developers using such a clause to obtain an unjust enrichment at the expense of homebuyers. He said that there had been an increase in incidents of developers delaying projects “until the sunset date is reached” at which time the developer can rescind and resell the property, sometimes for hundreds of thousands of dollars more. While a purchaser will eventually have the deposit returned, the purchaser would lose any capital appreciation of the lot that had occurred in the meantime. In addition, a purchaser will be prevented from purchasing another property while “funds are tied up in the developer’s hands”.
The Minister observed that whether a developer would be entitled to rescind the contract will depend on the contract terms, the reason for the delay and the extent to which the developer had acted reasonably. However, to test those factors, a purchaser would be required to take court action in which the purchaser would be required to prove that the delay was unreasonable based on facts that the purchaser would not be able readily to access. He said that the prospect of protracted litigation was often too daunting for purchasers, with the consequence that the actions of developers remained unchallenged. The Minister observed that he had heard of many instances where the rise in property prices since the date of the original purchase, combined with legal costs, meant that raising another deposit was no longer possible for a particular purchaser.
The Minister said that the proposed 66ZL would protect purchasers by allowing developers to rescind a contract only when the sunset date is reached and requiring the Court to review the circumstances to make sure the rescission is just and equitable in all of the circumstances. The Minister referred to the proposed requirement for a vendor to give 28 days’ notice before the proposed rescission, thereby giving a purchaser time to consider his, her or their position and to provide information that will help the purchaser assess whether the vendor has acted reasonably or whether the vendor’s actions have been arbitrary and capricious. In stating the matters that the Court is to take into account when deciding if a rescission is just and equitable, the Minister stressed the importance of increase in value.
The Minister stated that the new regime would not arbitrarily intrude into existing contractual arrangements or impose unusual obligations on vendors. Rather, he said, it would reinforce existing consumer law as well as accepted common law and equitable principles. At the centre of the Bill was a resolve to prevent a developer manufacturing delays to obtain an unjust benefit, ensuring that developers would be unable to benefit unjustly at the expense of home buyers through the use of a sunset clause.
The Minister asserted that it was accepted that, in seeking to rescind a contract, a vendor must not act arbitrarily or capaciously or unreasonably, and that s 66ZL “supports these equitable principles” by removing any incentive that a vendor may have to manipulate the progress of a development, in a manner not available to the purchaser, to take advantage of windfall profits in a rising market. Importantly, therefore, the Minister said that the Court will be required to consider any rise in value of the lot from the original purchase price. If the value of the lot has increased significantly, the exercise of the right of rescission under a sunset clause would be “prima facie unfair”. The Minister said that, in those cases, the developer receives an unjust benefit in the form of the capital appreciation of the lot at the expense of the purchaser. He said that the provision was an important measure to prevent developers using “manufactured or false delays” to justify to the Court an intention to rescind. He said that the notice provisions and the need to obtain a purchaser’s consent would encourage better communication between the parties and that if it was clear that a development would not be finalised or would take significantly longer to complete than predicted, a purchaser would be unlikely to want to remain tied to the contract with the deposit lying dormant.
The Minister said that, if a developer has acted reasonably, rescission of a contract in such circumstances should be in the interest of both parties and the consent of the purchaser should be obtained easily. He said it is only where the rescission is dubious that a need should arise for Court action. In such “questionable cases” it would be the vendor who will be required to go to Court to justify its actions rather than the purchaser being forced to take action to prevent an injustice. The Minister said that, in order to even the balance of power between the parties further, the vendor developer would be liable to pay the purchaser’s costs of the proceedings unless it can be shown that the purchaser’s refusal to consent to a rescission was unreasonable.
The Minister emphasised that the proposal was not intended to affect any rights of a purchaser, who would be able to exercise whatever rescission rights the purchaser had under the existing contract. The Minister stated that an important feature of the amendment was that it was to apply to any rescission purported to have been made from the date when the legislation was announced on 2 November 2015. No rescission made by a vendor after that day will have been made in accordance with the contract unless the required notice has been served on the purchaser and the rescission otherwise complies with s 66ZL.
The Minister asserted that “this retrospective provision” was the strongest protection that the government could provide for home buyers in that it would prevent any developer from rushing to use a sunset clause on existing contracts to obtain an unjust benefit over a purchaser. He asserted that the amendment would ensure that developers doing the right thing can access the finance they need to get projects off the ground.

Scheme of s 66ZL

For the purpose of s 66ZL, an off the plan contract is a contract for the sale of a residential lot that has not been created at the time that the contract is entered into. A residential lot is a residential property within the meaning of s 66Q of the Conveyancing Act. It is common ground that the subject lot of each of the Contracts for Sale is a residential lot within the meaning of s 66Q. For the purpose of s 66ZL, a sunset clause is a provision of an off the plan contract that provides for a contract to be rescinded if the subject lot is not created by the sunset date, being the date set out in the off the plan contract as the latest date by which the subject lot must be created. It is common ground that each of the Contracts for Sale is an off the plan contract and that each contains a sunset clause within the meaning of s 66ZL.
Under s 66ZL(3), a vendor may rescind an off the plan contract under a sunset clause if the subject lot has not been created by the sunset date, but only if the purchaser consents in writing to the rescission or, relevantly, the vendor has obtained an order of the Court under s 66ZL permitting the vendor to rescind the contract under the sunset clause. Under s 66ZL(6), the Court may, on the application of a vendor under an off the plan contract, make an order permitting the vendor to rescind the contract under a sunset clause but only if the vendor satisfies the Court that making the order is just and equitable in all of the circumstances.
In determining whether it is just and equitable in all of the circumstances to make an order, the Court is required by s 66ZL(7) to take into account the following:

(a) the terms of the off the plan contract;

(b) whether the vendor has acted unreasonably or in bad faith;

(d) the likely date on which the subject lot will be created;

(e) whether the subject lot has increased in value;

(f) the effect of the rescission on each purchaser; and

(g) any other matter that the Court considers to be relevant.

Under s 66ZL(8), the vendor is liable to pay the costs of a purchaser in relation to the proceedings for an order under s 66ZL unless the vendor satisfies the Court that the purchaser unreasonably withheld consent to the rescission of the contract under the sunset clause.

Other provisions of s 66ZL have the effect of varying the contractual arrangements between a vendor and purchaser. Thus, s 66ZL(4) makes it a term of an off the plan contract that a vendor who is proposing to rescind the contract under a sunset clause must serve notice on the purchaser before the proposed rescission. The notice must specify why the vendor is proposing to rescind the contract and the reason for the delay in creating the subject lot. It is common ground that such a notice was given to each of the Purchasers, although there may be a question as to whether the notice adequately specified the reason for the delay in creating the subject lots. Section 66ZL(5) provides that a sunset clause cannot automatically rescind an off the plan contract. That provision has no application in the present proceedings. Under s 66ZL(9), nothing in s 66ZL limits any right that a purchaser may have to rescind an off the plan contract under a sunset clause.
Before dealing with the application of s 66ZL, it is necessary to say something about DGF and the history of the proposed subdivision. That history began in 2004. I will also be necessary to deal with DGF’s claims against the Di Federicos and their claims against DGF.

DGF

DGF was registered on 17 February 2002 with a paid up share capital of $2.00. Its initial directors were Mr Sylvano Frassetto (Mr Frassetto) and Mr Frank Gelonesi (Mr Gelonesi). Mr Graziano De Bortoli (Mr De Bortoli) is a chartered accountant. His accountancy practice, GDC Tax Pty Ltd (GDC), prepares and maintains the accounts and financial records for DGF and is the tax agent for DGF. GDC has maintained the financial records for DGF since its inception. Totu Pty Ltd (Totu) is now a shareholder of DGF. The shareholder of Totu is Saltnpepper Pty Ltd, of which Mr Gelonesi is a director. Mr Gelonesi’s wife is the only director of Totu.
Mr De Bortoli is a director of Sunrise Corporation Pty Ltd (Sunrise), which owns the building from which GDC is conducted. Mr Gelonesi is also a director of Sunrise. Mr Frassetto used to be a director and shareholder of Sunrise but sold out some years ago. Mr De Bortoli has been a friend and business associate of Mr Gelonesi and Mr Frassetto for many years. Mr De Bortoli previously held an interest in DGF but has since sold that interest.

Mr De Bortoli was responsible for the incorporation of DGF in his capacity as an accountant. DGF was incorporated for the purpose of undertaking property development. The proposed subdivision at Horsley Park the only development undertaken by DGF thus far. Since no sale has been completed, DGF has not yet realised any sales revenue.
DGF had no funds of its own and all of its working capital was provided by loans from its shareholders and other investors as well as $13,000 earned in interest on its capital. The other investors included small business clients of GDC’s practice who deposited their surplus funds with GDC for investment. However, there are no loan agreements in writing with any of the lenders.
In 2003, Mr Frassetto identified the land at Horsley Park as land that that he wished to develop. He approached Mr De Bortoli to see if he might be interested in investing in the proposed development. Mr De Bortoli approached Mr Gelonesi and another friend, Mr Michael Remaili. In approximately 2003, a meeting took place involving Messrs Frassetto, Gelonesi, De Bortoli and Michael Remaili, together with Mr Peter Remaili, Michael Remaili’s brother, to discuss the proposed operations of DGF. Mr De Bortoli said that they were all going to have to inject money into DGF and proposed that interest at the rate of 8% per annum be paid unless the investors agreed to change the interest rate at a later time. All of those present agreed. After the meeting, on 13 January 2003, DGF received an initial injection of funds amounting to $2,357,759.33. Those funds were paid into DGF’s bank account and were applied in the purchase by DGF of part of the land at Horsley Park.
After that initial investment, Mr De Bortoli was involved in the negotiation of all of the other loans with other investors on behalf of DGF. He had separate conversations with each of the principals of those investors other than the investors of which he is a principal, being Sunrise, GDC, Pinti Pty Ltd and GDC Partnership. It was Mr De Bortoli’s standard practice to say to each prospective investor that any funds that might be advanced would be used in the development that DGF was undertaking at Horsley Park and that DGF would pay interest at the rate of 8% per annum. He told each investor that the payment of interest and the repayment of principal would not occur until completion of the sale of the lots after the proposed subdivision had been completed. Each of the investors or their principals agreed to that proposition. Each of the investors provided funds to DGF after such discussions.
When DGF required further funding from investors, Mr De Bortoli had a practice of saying to the investors that DGF needed another loan on the same terms. He asked each lender for a specified sum. No investor refused to provide further funds in the amount requested. Shortly after each conversation, the funds requested were paid to DGF.
From time to time some investors requested repayment. In each case DGF repaid an investor who requested repayment. Some of the early investors have been repaid in full. Mr De Bortoli arranged loans from other clients of GDC’s accountancy practice to enable DGF to repay loans from investors who wished to be repaid. Details of the advances and repayments are recorded in the financial records maintained by GDC, as recorded in a tax schedule prepared by GDC, including a loan reconciliation summary, which is a primary record and has been maintained for a large part of DGF’s existence. Liability for interest has been recorded in the 2015 and 2016 tax returns. The total amount of loans as shown in the document is $9,664,201.
DGF’s present assets include eight hectares of land situated between Horsley Road and Delaware Road, Horsley Park the land and a debt of $3,569,110.85 owing to it by Nelson Bay Developments Pty Ltd (Nelson Bay), a company owned by Mr Frassetto, . Nelson Bay borrowed funds from DGF to purchase land at Nelson Bay in about 2004 for a price of $2,836,000. The terms of that loan are unclear. It appears that it is repayable on demand.
The records of DGF leave a great deal to be desired. There appear to have been no formal meetings of directors and no formal recording of the arrangements with investors briefly summarised above. Mr De Bortoli agreed in cross-examination that the shareholders of DGF have never resolved to pay interest on loans made by investors and he is not aware of any formal resolution of the directors of DGF to enter into any loan agreement with any of the investors. Mr De Bortoli did not think it was necessary to have any form of written record of agreements with investors. He confirmed that investors or principals of the investors could, if asked, give evidence about the terms of the arrangements.
Mr De Bortoli accepted in cross examination that DGF’s accounts are not properly prepared. While there are several separate investors, the investors are linked by shareholding to one or other of Messrs De Bortoli, Gelonesi and Remaili. The only exception is Ms Maureen Towe. DGF contends that the close relationship of the investors explains the lack of formality in relation to the loans and that informality should not diminish the reliability of DGF’s accounts. Despite the absence of written loan agreements or resolutions of the directors authorising the making of such agreements, I am prepared to accept the amount of the loans and the dates upon which they were made as shown in that summary.
Bank statements of DGF in evidence show expenses incurred by DGF in connection with the proposed subdivision development. However, they do not show amounts expended on buying the land in the first place.

The History of the Proposed Subdivision

By 2004, DGF had become the registered proprietor of the rural land situated between Horsley Road and Delaware Road, Horsley Park (the DGF land). At that time, the Di Federicos owned 2.4 hectares adjoining the DGF land (the Di Federico’s land). A further 8 hectares were owned by John and Nina Galea and Paul and Maria Scarfone.
On 21 June 2004, the Di Federicos, as vendor, and DGF as purchaser, entered into a contract for the sale of a portion of the Di Federicos’ land for a total price of $170,000. The subject of the contract was described as “the access triangle”, which was required by DGF in order to construct a public access road for the purpose of the proposed subdivision. The price was apparently paid on or around 21 June 2004. Completion of the contract was conditional upon grant of consent to a proposed plan of subdivision, a copy of which was annexed to the contract.
The contract was also expressed to be conditional upon all parties executing, within seven days of the date of the contract, a joint venture agreement annexed to the contract, whereupon the sum of $170,000 was to be released to the Di Federicos. The contract provided that, should the joint venture agreement not be signed, either party was to be entitled to rescind the contract.
The parties to the joint venture agreement annexed to the contract were:

DGF;

the Di Federicos;

John and Nina Galea; and

Paul and Maria Scarfone.

The draft joint venture agreement recited that the parties had agreed to form a joint venture for the purpose of subdividing various parcels of land situated in Delaware Road and Horsley Road, Horsley Park into rural residential lots, largely in accordance with a plan annexed to the draft joint venture agreement. That plan provided for the subdivision of all of the land into 15 lots. At the conclusion of the proposed joint venture, lots 1 to 8 were to be registered in the name of DGF, lots 9, 10 and 15 in the name of John and Nina Galea, lots 11 and 12 in the name of Paul and Maria Scarfone and lots 13 and 14 in the name of the Di Federicos.
The draft joint venture agreement provided for contribution by the parties to development costs. DGF was to be responsible for the works required to complete the development and the parties agreed to allow DGF a period of two years from the date when the agreement was executed by all parties to complete the development. Each of the parties had specific responsibilities, such as filling in dams situated on parts of the land, as well as contribution of their share of costs. However, the draft joint venture agreement was not executed by all parties and ultimately John and Nina Galea and Paul and Maria Scarfone did not join in the proposed joint venture.
On 12 September 2006, Fairfield City Council (the Council), gave notice of determination of development application 134 of 2005 for subdivision of various parcels in Delaware Road to create 14 non-urban residential lots and a new road. The consent operated from 13 September 2006. On 29 January 2007, the Council consented to development application 1580 of 2005 for subdivision of various parcels of land to create three non-urban residential lots.
On 8 July 2010, the Council approved development application 1171.1 of 2009 for the creation of 12 non-urban residential allotments and the construction of a new road (Consent 1171.1). Condition 1 of Consent 1171.1 required that the development was to take place in accordance with the approved development plans drawing No 11253/10 dated October 2009 (the Approved Drawing) as prepared by DGF’s surveyors, Britten & Associates Pty Ltd (Britten and Associates), except as modified by the Council or any conditions of the consent. Condition 10 provided that any fill imported to the site was to be validated in accordance with “the EPA’s Contaminated Sites Sampling Design [G]uidelines 1995”.
Conditions 34 to 57 of Consent 1171.1 incorporated conditions imposed by the NSW Office of Water (NSW Water). Under those conditions, Consent 1171.1 was to apply only to the controlled activities described in the plans and associated documentation relating to Consent 1171.1 and provided by the Council. Any amendment or modification of the proposed controlled activities was to be notified to NSW Water and any amendments or modifications could render Consent 1171.1 invalid. On 8 May 2012, NSW Water sent an email to Britten and Associates saying that before controlled activity approval could be issued, the applicant needed to submit a bond that reflected the cost of the implementation of “the VMP and its maintenance”. The email said the security bond could be in the form of a bank guarantee.
On 6 August 2012, NSW Water determined to issue a controlled activity approval under the Water Management Act 2000 (NSW). Condition 6 required that the approval holder comply with the requirements of the plans identified in the notice of determination. Condition 7 required the approval holder to submit any amendments to a plan for approval by NSW Water prior to carrying out any works. On 7 August 2012, NSW Water registered the provision of security by DGF in the sum of $70,000 by way of bank guarantee.
On 12 February 2013, Mr Frassetto sent an email to Enzo Di Federico confirming that DGF had agreed to:

1. Construct a new concrete driveway crossing and a new driveway to existing residences in a location as agreed on site and as marked in pink on an identified plan.

2. Reconstruct the creek in accordance with plans approved by the Council.

3. Landscape a 10 metre wide riparian zone along the creek in accordance with NSW Water approval marked in green on the plan.

4. Fill and regrade areas marked blue on the plan with a minimum fall of 0.5% towards the creek.

5. Make a new connection to existing water main in locations marked in yellow on the plan.

6. Connect new underground electricity supply to existing ducts at the rear of the residence in locations marked in yellow on the plan.

Mr Frassetto asserted that the Di Federicos had confirmed that the above proposal would be accepted in principle subject to the following additional conditions:

7. Locating some benchmarks on site to determine the level of fill along the new driveway.

8. Making inquiries as to the naming rights of the new street.

9. Making a contribution towards the legal costs paid to Mark Marando.

Mr Frassetto confirmed that, provided all documents were signed and executed within seven days, including an attached transfer and joint venture agreement, DGF would be prepared immediately to:

10. Instruct the surveyor to provide benchmarks on site to determine the level of fill along the new driveway.

11. Instruct surveyor to make inquiries as to the naming rights of the new street.

12. Contribute a total of $8,000 towards the legal costs paid to Mark Marando.

On 8 August 2013, DGF commenced proceedings 241896 of 2013 (the 2013 Proceedings) seeking a declaration that, despite the fact that the other parties had not executed the draft joint venture agreement, DGF and the Di Federicos had entered into a joint venture agreement on or about 21 June 2004 for DGF to develop the Di Federicos’ land and surrounding land, and for the Di Federicos to permit construction of the roadway over their land and join in a development application to be lodged by DGF and others. The 2013 Proceedings also claimed orders for specific performance by the Di Federicos of the alleged joint venture agreement and for execution of all necessary documents to enable lodgement of a final linen plan with the Council and to do all things necessary to enable registration of the final linen plan with Land and Property Information New South Wales (LPI).
On 25 September 2013, the Di Federicos filed a defence and a cross-claim in the 2013 Proceedings. By the cross-claim, the Di Federicos alleged that DGF was in breach of the contract for sale dated 21 June 2004. The cross-claim also alleged breach of an agreement whereby DGF would use fill from the subdivision to raise the ground level of the Di Federicos’ land. It appears that that allegation was intended to refer to the agreement evidenced by Mr Frassetto’s email of 12 February 2013. In its defence to the cross-claim, DGF admitted that an agreement was entered into to raise part of the ground level of the Di Federicos’ land but did not admit the allegation that it would use fill from the subdivision to raise the ground level.
On 17 December 2013, DGF and the Di Federicos entered into the 2013 Deed to resolve the disputes that were the subject of the 2013 Proceedings. By cl 3.1 of the 2013 Deed, the Di Federicos promised to execute and return to DGF all documents requested by DGF to enable the development to progress consistently with Consent 1171.1. [2] The documents were to be returned within seven days of delivery of them to the Di Federicos. By cl 3.4, the parties acknowledged that the contract for sale of 21 June 2004 had been rescinded and was of no force and effect. However, by cl 3.5, DGF promised to provide to the Di Federicos a transfer of the “access triangle” that had been the subject of that contract. The transfer was to show a consideration of $170,000 and the parties acknowledged that this consideration had been paid by DGF to the Di Federicos.
2. While cl 3.1 in fact refers to Consent 1170.1, I accept that this was intended to be a reference to Consent 1171.1.
By cl 4.1 of the 2013 Deed, DGF agreed to use its best endeavours to cause tradesmen to undertake levelling works on the Di Federicos’ property and the driveway on their land. By cl 4.2 of the 2013 Deed, the tradesmen were to be retained by DGF as agent for the Di Federicos, but engagement was at the cost of DGF. By cl 4.3 of the 2013 Deed, DGF agreed to cause to be carried out such works to fill and regrade the areas in lots 11 and 12 within the blue boundaries on the A3 plan annexed to the 2013 Deed (the 2013 Plan). A copy of the 2013 Plan is contained in Appendix 2 to these reasons.
The work referred to in cl 4.3 of the 2013 Deed was to be carried out so that:

the ground level between the driveway to the west and the creek to the east would, using the driveway as a starting reference point, be subject to a fall of approximately 0.5% towards the creek; and

the ground level between the eastern boundary of Lot 12 to the east and the creek to the east would, using the said boundary as a starting reference point, be subject to a fall of approximately 0.5% towards the creek.

That requirement appears to reflect the promise contained in the email of 12 February 2013 that the areas marked blue on the plan would be filled and regraded with a minimum fall of 0.5% towards the creek.

By cl 4.4 of the 2013 Deed, the levelling works were to be undertaken in a manner that was consistent with “the general lie” of the Di Federicos’ surrounding land and otherwise in accordance with “the Council approved plans” with respect to the development. The Di Federicos also acknowledged and agreed that levelling did not mean obtaining a flat, level surface but would require DGF to use its best endeavours to grade the land in accordance with the existing plans but not to cause any deviation from the natural flow or to cause any gradation away from the creek on the Di Federicos’ land.
By cl 4.5 of the 2013 Deed, DGF agreed to construct a new concrete driveway crossing and a new asphalt driveway, with a width of 3.5 metres, from the road running along the northern side of each of lots 11 and 12 in the 2013 Plan to a brick cottage on lot 11 in which the Di Federicos resided, in locations marked in the 2013 Plan. By cl 4.6, the driveway was to be constructed as closely as possible to follow the pink line in the 2013 Plan and to conform with identified specifications. Those provisions appear to reflect the promise contained in item 1 of Mr Frassetto’s email of 12 February 2013.
By cl 4.8 of the 2013 Deed, the Di Federicos agreed to do all necessary acts and things and give all necessary consent to enable tradesmen to undertake the levelling and driveway works, and otherwise to access the Di Federicos’ land. That promise has some significance as will appear below. Clause 4.9 provided that, if the Di Federicos were dissatisfied with any course proposed or taken by tradesmen undertaking the levelling work or the driveway, they were to contact one of the directors of DGF in which event the director was to liaise with the tradesmen “to attempt to sort out any differences”.
Clause 4.10 of the 2013 Deed provided that, on completion of the levelling works and the driveway, DGF was to engage Britten and Associates to certify that the levelling works and driveway had been carried out in accordance with “the Council approved plans” and in a proper and workmanlike manner. If Britten and Associates did not so certify, DGF was to use its best endeavours to cause its tradesmen to cause the levelling works and driveway to comply with any reasonable recommendation by Britten and Associates. If Britten and Associates certified the levelling works and the driveway as being compliant with “the Council approved plans” and in a proper and workmanlike manner, that certification was to be final.
By cl 4.11 of the 2013 Deed, DGF agreed to cause water and electricity services to be connected to the Di Federicos’ land at locations marked on the 2013 Plan. That was to be done at the same time as it connected electricity and water services to the rest of the proposed development. That appears to reflect the promises contained in items 5 and 6 of Mr Frassetto’s email of 12 February 2013.
Clauses 4.12 and 4.13 of the 2013 Deed dealt with the creek and reflect items 2 and 3 of Mr Frassetto’s email of 12 February 2013. By cl 4.12, DGF agreed to reconstruct the creek in accordance with all applicable existing conditions of the Council. By cl 4.13, DGF agreed to landscape the 10 metre wide areas of lot 12 on either side of the creek marked in green on the 2013 Plan in accordance with all applicable approvals of NSW Water relating to lot 12.
The 2013 Plan had been prepared following a meeting on 16 January 2013 between Enzo Di Federico and Mr Frassetto. It contains a statement that it was to be read in conjunction with development approval 134 of 2005 of 12 September 2005. It seems that the 2013 Plan was the plan referred to in the email of 12 February 2013.

There is some dispute concerning the meaning and purport of the phrase “fill and regrade” used in cl 4.3. DGF contends that the phrase imports no more than the “levelling work” that DGF promised to cause tradesmen nominated by it to undertake. DGF points to cl 4.4, whereby Britten and Associates were required to certify that the levelling works had been carried out in accordance with “the Council approved plans”. DGF contends that the phrase must be construed in the context of the surrounding clauses.
The Di Federicos, on the other hand, assert that it is relevant that cl 4.3 was intended to incorporate the earlier agreement made between the parties in respect of the 2013 Plan, which required the level of the relevant lots to be raised. They say that the only plan with which the works were required to comply was the 2013 Plan, which had been brought into existence in connection with the accord apparently reached in January and February 2013. The Di Federicos contend that, while cl 4.10 requires the “levelling works” to be carried out in accordance with “the Council approved plans”, it does not require that “the Council approved plans” are the same plans as were in existence at the date of the 2013 Deed. They contend that the only proper construction that can give effect to the intent of cl 4.3 and cl 4.7, by which the parties agreed that Christmas holidays and other stoppages attributable at the time of the year may necessitate some delay in the undertaking of the levelling works and the driveway, is that the works contemplated by cl 4.3 had to be carried out in accordance with “the Council approved plans” as amended by DGF from time to time, so as to comply with its obligations under cl 4.3. That is to say, the Di Federicos contend that if an application under s 96 of the Environmental Planning and Assessment Act 1979 (NSW) to approve amendment of the Council approved plans was needed to give effect to cl 4.3, DGF was obliged to obtain that amendment.
While “the Council approved plans” are not specifically identified in the 2013 Deed and that phrase is not defined, it is reasonably clear that the parties had in mind the plans that had been approved by Council as at the time of the making of their agreement. Thus, the 2013 Plan refers expressly to development consent 134 of 2005. There is no basis for construing the phrase “fill and regrade” when applied to parts of the Di Federico land as requiring filling and regrading in accordance with the plan that at that stage had been approved. There is otherwise no specification of the work that was to be undertaken by DGF by way of “levelling”. The “Council approved plans” imposed levels that limited the height of the development and neither DGF nor the Di Federicos could fill and regrade except in accordance with the plans. There is no basis for reading into cl 4.3 an obligation on the part of DGF to obtain consent to amendment of the plans to permit some different filling and regrading. As at the date of the 2013 Deed, the land in its natural state was as per the drawing attached to the 2013 Deed, which was the Approved Drawing, as referred to in condition 1 of the notice of determination of 8 July 2010.
On 4 February 2014, Enzo Di Federico, Mr Frassetto and a representative of RGM Civil, DGF’s contractors, met on the Di Federicos’ land to discuss the scope of works that needed to be completed in accordance with the 2013 Deed. The new driveway to the Di Federicos’ residence, the connection of power to the residence and water works that needed to be completed on DGF’s property were discussed as well as reconstruction of the creek on lots 11 and 12. There was also discussion about how soils removed from the creek would be reused in the filling process of lots 11 and 12.
Mr Frassetto gave evidence that, in the expectation that the issues between DGF and the Di Federicos had been resolved in accordance with the 2013 Deed, he gave instructions to DGF’s solicitors to prepare contracts for the sale of the eight lots in the proposed subdivision that were to be owned by DGF. On the other hand, the Di Federicos assert that, if Mr Frassetto genuinely believed that the issues with the Di Federicos had been resolved prior to entering into the Contracts for Sale, DGF had no regard to the fact that, by the time it did so, it was already in breach of the obligations imposed on it by cl 4.3 of the 2013 Deed.
On 17 February 2014, DGF entered into a Contract for Sale in respect of proposed lot 4 with Joe and Gloria Pijaca (Mr and Mrs Pijaca) for the price of $725,000. On 20 February 2014, DGF entered into a Contract for Sale in respect of lot 5 with Mrs Samantha Panuccio (Mrs Panuccio) for the price of $650,000. There is a question of whether the true price under sale contract was in fact $650,000. DGF, on the other hand, asserts that the true consideration payable was $850,000. I shall return to that question below. On 1 May 2014, DGF entered into a Contract for Sale of proposed lot 1 with Marianna and Bolos Butros (Mr and Mrs Butros) for a price of $850,000.
On 1 April 2014, Mr Frassetto had sent an email to RGM Civil regarding when “work on the project” could be commenced. The email suggested that RGM Civil was to commence work in January 2014 but had been experiencing business difficulties and had been ignoring DGF. On 2 April 2014, Mr Frassetto sent a further email to RGM Civil suggesting that work should commence immediately because of pending sales. RGM Civil apologised for the delay due to other projects and told Mr Frassetto they would contact him later that week. Mr Frassetto passed that email on to the Di Federicos’ son, Mr Carlo Di Federico (Carlo), who suggested that DGF should use another contractor if RGM Civil was not responding, and said that the Di Federicos would not tolerate further delay.
DGF now asserts that the levelling works contemplated by cl 4.3 and cl 4.4 of the 2013 Deed were completed by around May 2014. On the other hand, the Di Federicos assert that the only filling and regrading carried out by DGF on the Di Federicos’ land was to a small portion of the land near the creek and that that would not constitute compliance with the obligations imposed by cl 4.3 and cl 4.4 of the 2013 Deed. DGF relies on photographs that Mr Frassetto says he took in May 2014. The photographs are equivocal as to what work had or had not been done at the time when they were taken.
Mr Frassetto accepted in cross-examination that the majority of the Di Federicos’ land shown in the 2013 Plan within the blue outline was never filled by DGF, whether or not it had been graded. The reason why the only fill that was placed on the Di Federicos’ land was in an area marked by Mr Frassetto is that he was of the view that the 2013 Deed did not require DGF to place any further fill on the Di Federicos’ property. In any event, he agreed that by mid-2014, DGF and the Di Federicos were in “heated disagreement” as to the proper construction to be given to the 2013 Deed.
On 19 May 2014, Carlo sent an email to Mr Frassetto “recapping” a meeting held on Friday 16 May 2014. Carlo said that the creek was “looking good” but that he would like to see boulders on the bank wall next to the bridge to retain the dirt. He then said that, as he had stated on Friday concerning the fill, he “may be able to help in that field in the way [of] fill” but would need to know the amount needed and any specifications so that that could be organised. That email was followed by an exchange of text messages between Mr Frassetto and Carlo as follows:

“Frassetto: I did a quick calculation. You could put in about 50 to 100 truckloads of topsoil only.
Carlo: How much would that rise do you think
Frassetto: About a max of say 300mm
Carlo: Bit low but I’ll see what I can get”

DGF contends that the text message exchange and email on 19 May 2014 were consequent upon the conclusion of the grading works, at which time the Di Federicos wanted more fill brought onto their land to raise the level of lots 11 and 12. DGF says that that was not a request for further grading of the existing works or any suggestion that the creek work had not been concluded. Mr Frassetto agreed that the material that was recovered from the creek was probably placed only in the area on the 2013 Plan tinged with blue that was marked. DGF contends that the text messages and conversations on and from 19 May 2014 were attempts by Mr Frassetto to placate the “single minded” objectives of Enzo Di Federico who wanted to fill, and thereby elevate, the Di Federico land by limiting the importation of top soil to 300mm. Mr Frassetto said that Enzo Di Federico wanted the level of his land lifted by one metre, and that he told Enzo Di Federico that Enzo was not allowed to import fill. He said that there was no way that the Council would approve that sort of fill and that the best Mr Di Federico could do was to put on a “bit of topsoil”, which was allowable. Mr Frassetto said that he was trying to keep Enzo Di Federico happy without getting into trouble with the Council.
Carlo agreed that he had a conversation with Mr Frassetto at around that time, when he was told that they were not allowed to fill but that, if they were putting a minimum topsoil of 300mm for landscaping the riparian zone, they could probably get away with it without further development approval. He agreed that Mr Frassetto told him that any more than that and they would be in trouble with the Council. Carlo also agreed that Mr Frassetto told him that he would do some calculations to see what could be brought in, but that DGF would not be paying for it.
Carlo said that he believed that Joe Morizzi, an employee of RGM Civil, had some top soil that he wanted to get rid of from a Hoxton Park subdivision, and that he would see what he could do. In June 2014, the Di Federicos caused fill to be deposited on the Di Federico land. The fill was deposited without the approval of the Council and was outside the conditions of the development consent. On 4 June 2014, the Council received a complaint about unauthorised landfill deposited on the Di Federico land.
On 15 June 2014, Carlo sent an email to Mr Frassetto “recapping” their conversation of the previous day. Carlo said in the email that he understood that, within the next six to 10 weeks, the works should be completed and the subdivision ready to be registered. He said that he had spoken to his parents and understood that “the filling of the blocks marked out in mediation plan” could take some time. He said that “in good faith and in the interest of not delaying DGF any further” the Di Federicos had decided “to release [DGF] from their obligation” on the following conditions:

1. Construct a new driveway at a cost of $38,000;

2. Reconnect water mains to the Di Federico residence at a cost of $8,000;

3. Reconnect three-phase electricity to Di Federico residence at a cost of $16,000;

4. Fill and levelling “of the marked blocks in mediation plan” at a cost of $80,000.

Carlo said that those works came to a total of $142,000 and that, as the Di Federicos did not wish to delay DGF any further, they were willing to have the value of the works released to them by DGF so that they might continue the works “on their own accord”. Carlo said that they were happy to discuss the value of the quotes received and could have other contractors “quote the scope of the works”. He said that the Di Federicos were willing to have the arrangement drawn in the “mediation papers” so that the Di Federicos must complete the works and not just profit from the money and not complete the works.

The reference in the email of 15 June 2014 to the “mediation plan” appears to be a reference to the 2013 Plan. It is not clear what the “mediation papers” are. It may be a reference to the 2013 Deed.

On 23 June 2014, Carlo sent another email to Mr Frassetto noting that he had not received any reply to his email of 15 June 2014 and saying that he believed that DGF refused to accept the offer or “do the scope of works in question”. He asked that the keys to “the front gates” be returned within 24 hours and that the pile of dirt and reeds dug out from the creek be removed without delay. The email ended by saying that it was “extremely disappointing” that DGF refused to liaise with the Di Federicos “on these matters”.
Mr Frassetto responded by email late on 23 June 2014, in which he said that he was not in a position to make any decisions “before taking your offer to the partners”. Mr Frassetto said that it was extremely disappointing that, “after all this time you have made us wait”, the Di Federicos could only give 24 hours to resolve the outstanding issue. Mr Frassetto rejected Carlo’s assertion that DGF was unwilling to liaise or compromise and that over the last 10 years it had always been Enzo Di Federico who had been unwilling to liaise or compromise.
On 24 June 2014, Carlo responded by email. He indicated that he had “received notice from Vince Morizzi [a consultant with Big Picture Developments engaged by the Di Federicos] that [DGF] have rejected both offers”, and that he “really [didn’t] like being lied to”. Carlo reiterated the request that the keys be returned before 8.30pm that day.
On 25 June 2014, Simone Legal, DGF’s solicitors, wrote to Marando Solicitors, who were acting for the Di Federicos, attaching the emails just described and asserting that the Di Federicos were seeking to depart from the terms of the 2013 Deed and that DGF was not prepared to vary the terms of the 2013 Deed. Simone Legal said that they had been instructed that the Di Federicos had brought fill onto their property and that they had required that DGF attend to the levelling of the fill. Simone Legal asserted that the fill was brought without DGF’s consent and that there was no obligation on DGF to fill and level the Di Federicos’ property beyond that referred to in cll 4.3 and 4.4 of the 2013 Deed. The letter asserted that, since the Di Federicos had brought additional fill onto their land, they had effectively prevented DGF from meeting its obligations under the 2013 Deed. The letter asserted that DGF remained ready, willing and able to meet its obligations, subject to the Di Federicos either removing the additional fill or alternatively agreeing to meet any additional expenses involved in levelling the additional fill.
The letter of 25 June 2014 then said that the Di Federicos had indicated that they proposed to deny access to the development site and requested Marando Solicitors to remind the Di Federicos of the terms of the 2013 Deed. Simone Legal ended by saying that Simone Legal were instructed that, should the Di Federicos in any way seek to impede or delay the completion of the development works and delay registration of the proposed plan of subdivision, they were to commence proceedings seeking orders that the Di Federicos comply with their obligations under the 2013 Deed.
By letter of 10 July 2014, Marando Solicitors rejected the assertion that the Di Federicos were seeking to depart from the terms of the 2013 Deed. They asserted that the fill brought onto the Di Federicos’ land was not within the boundaries of lot 12 and had been brought in to fill after the existing driveway had been removed. They said that the Di Federicos had never informed Mr Frassetto that they required the fill to be levelled and that the fill was for their own use once the subdivision was completed. They asserted that the fill had only recently been brought onto the Di Federicos’ land and did not impede DGF “from completing their works” and rejected the proposition that DGF was prevented from meeting its obligations under the 2013 Deed. Marando Solicitors said that the Di Federicos rejected the suggestion that they had indicated that they proposed to deny DGF access to the development site and that the request for the keys was because the temporary fencing was being relocated to another site.
Carlo said in evidence that the fill deposited on the Di Federico land in June 2014 was limited to five truck loads for planting purposes and that approximately 50 to 60 truckloads were brought onto the land in August. Carlo denied that the June fill that was the subject of the exchange between the solicitors was part of the same fill for which the Di Federicos later sought reimbursement from DGF in the sum of $140,000.
It is significant that Marando Solicitors’ letter of 10 July 2014 made no assertion that DGF was in breach of the 2013 Deed. That suggests that, at the time they gave instructions to write that letter, the Di Federicos did not believe that DGF had failed to perform its obligations under cll 4.3 and 4.4 of the 2013 Deed.
On 21 July 2014, DGF entered into a Contract for Sale in respect of proposed lot 8 with Michael and Tanya-Marie Scarvelis (Mr and Mrs Scarvelis) for a total price of $880,000. On 22 July 2014, DGF entered into a Contract for Sale in respect of proposed lot 7 with Stiven and Linda Mihajlovic (Mr and Mrs Mihajlovic) for a total price of $860,000.
On 2 August 2014, DGF entered into a Contract for Sale of proposed lot 2 with Peter and Diane Noble (Mr and Mrs Noble) for a price of $850,000. On 15 August 2014, DGF entered into a Contract for Sale of proposed lot 3 with Zafer and Nuran Okan (Mr and Mrs Okan) for a price of $840,000.
On 16 September 2014, Simone Legal sent an email to Marando Solicitors saying that it appeared that the Enzo Di Federico had “deposited a large amount of fill on their property” and that DGF was concerned that such a large amount of fill had been brought onto the land. The email said that it was estimated that the amount of fill was approximately 1.5 metres above the natural level of lots 11 and 12, asked whether the Di Federicos had obtained Council approval to fill the land, and requested that, if so, a copy of the approval be forwarded as a matter of urgency. The email asserted that the works being carried out by the Di Federicos were preventing DGF from constructing the driveway and connecting the power and water to the Di Federicos’ residence. The email also stated that DGF had exchanged contracts in respect of a number of the proposed lots and that those contracts had sunset dates of varying times from December 2014 to January 2015.
There was no response by Marando Solicitors to Simone Legal’s email. However, shortly thereafter, Carlo asked for a copy of the development consent and on 18 September 2014, Mr Frassetto sent to Carlo a copy of Consent 1171.1.
On 22 September 2014, Simone Legal wrote again to Marando Solicitors saying that they had been instructed that a meeting had taken place “at the subject site” on 19 September 2014, when Mr Frassetto met with Enzo and Carlo Di Federico. The letter said that, during the meeting, Mr John Howie (Mr Howie) of Britten and Associates had been telephoned and confirmed that, in the absence of Council consent for the fill that had been deposited on the Di Federicos’ land, he could not certify in accordance with the 2013 Deed. The letter said that Simone Legal understood that the Di Federicos had indicated to Mr Frassetto that the issue of the fill “would be remedied this week”. Simone Legal ended by saying that DGF was in a position to construct the driveway, connect the power and water to the Di Federicos’ residence subject to the issue of the fill being dealt with.
On 8 October 2014, Simone Legal wrote again to Marando Solicitors confirming that DGF had exchanged contracts on a number of the proposed new lots and that the contracts required completion in December 2014 and January 2015. They said that they had been instructed that representatives of the Council had attended the development site on that day to inspect the driveways and that Carlo had been on the site when the Council representatives attended. Simone Legal said that they understood that the Council officers expressed concern about the fill that had been deposited on the Di Federicos’ land, together with the continued importing of material.

Simone Legal also said that they understood that the Council officers had confirmed that there was no development application or development approval in respect of the fill that had been deposited on the Di Federicos’ land. Simone Legal requested an urgent reply as DGF was concerned that the registration of the plan of subdivision might be delayed by reason of works currently underway without development approval, which it was asserted, would delay the Council releasing the linen plan for registration. The letter said that, by reason of the operation of the sunset provisions of the exchanged contracts, the Purchasers might seek to rescind the contracts on the basis that the plan of subdivision had not yet been registered.
Marando Solicitors responded on 10 October 2014, saying that they were instructed that any works that had been carried out on the Di Federico property had not caused any affectation or delay to the progression of the subdivision. The letter confirmed that Carlo was present when representatives from the Council attended on 8 October 2014 and that the Council’s representative indicated that the “road naming and laybacks” had to be completed before the linen plan could be submitted to Council and that that had not yet been done. The letter also said that power for the subdivision would not be connected for at least another month and that earth works, road works and a relocation of power turrets had been requested by the Council. The letter asserted that the Di Federicos were still waiting for works to be completed by DGF as contemplated by the 2013 Deed, although no specific works were identified. The letter rejected any assertion that the delay with the registration of the plan of subdivision was attributable to the Di Federicos or any action or inaction by them.
On 13 October 2014, the Council wrote to the Di Federicos in relation to Consent 1171.1. After referring to a recent site inspection that was said to have revealed that “extensive landfill has taken place which compromises the conditions imposed in the consent”, the letter said that Council officers had instructed such work to cease on 8 July 2014 because of the “unauthorised nature of this work”. The letter went on to say:

“The inspection identified serious concerns including but not limited to landfill taking place in close proximity to a watercourse/creek as well as likely adverse impact on the existing flood storage areas.
Council considers the work has created potential for serious ramifications with regard to excessive raising of levels compared to the levels indicated on the approved plans for the subdivision as well as undesirable impact on the flow path of the watercourse/creek during rain events which has the potential to create a damming effect and flooding to properties upstream of the subject property.
In issuing the instruction to cease work, you are reminded that should work recommence without resolution of Council’s concerns, the effect will be that directions will be sought to have unauthorised deposits of landfill removed as Council cannot approve retrospectively the unauthorised works, that is, in the event of further unauthorised works proceeding, Council will without further notice, instruct its legal representatives to proceed with legal action to seek formal orders to have the unauthorised landfill removed.
In the interim, you are directed to provide sedimentation control barriers at the foot of unauthorised landfill close to the watercourse as well as to surround the stockpiles of landfill remaining on the property.”

It appears that the sedimentation control barriers required by the Council were put in place. The letter from the Council went on to require the submission of a s 96 modification application to amend Consent 1171.1, together with specified documentation including a survey plan, a flood report, a geotechnical report and two cheques made payable to the Council and NSW Water.
On 30 October 2014, DGF entered into a Contract for Sale in respect of proposed lot 6 with Mark and Raquel Azzopardi (Mr and Mrs Azzopardi) for a price of $890,000. That was the last of the eight Contracts for Sale.
On 4 November 2014, Mr Frassetto sent an email to Mr Jason Armstrong (Mr Armstrong), a civil engineer with Strategic Environmental and Engineering Consulting (SEEC), attaching final levels of additional filling along the creek at the proposed subdivision. Mr Frassetto informed Mr Armstrong that the Council had requested that the effect of the additional filling on flood levels be checked. He requested advice and a fee proposal to be addressed to Enzo Di Federico. On 5 November 2014, Mr Armstrong provided a fee estimate as requested.
On 14 November 2014, Simone Legal sent to DGF documents received from Britten and Associates as follows:

section 88B instrument;

deposited plan administration sheet;

transfer; and

copy linen plan.

Simone Legal noted that DGF was to make arrangements for the execution of the documents by all parties and return to them as soon as possible.

On 18 November 2014, Mr Frassetto delivered to the Di Federicos the following transfer documents for their execution:

section 88B instrument;

deposited plan administration sheet;

linen plan;

the letter to DGF dated 14 November 2014.

Carlo saw those documents in the possession of Enzo Di Federico shortly after 14 November 2014. Carlo agreed that, unless or until DGF paid the Di Federicos $140,000, the documents would not be signed. He also agreed that there has never been any suggestion that the resolve of the Di Federicos in not signing the documents without being paid for the fill had changed. It is not entirely clear whether the $140,000 demanded by the Di Federicos is referable to the $142,000 worth of work outlined in the 15 June 2014 email, of which the fill and levelling works were to cost $80,000. Carlo gave evidence that the Di Federicos expended $140,000 in completing certain works, but that this $140,000 was “just the cost of the fill”, and not the cost of doing other work as well.
Mr Frassetto communicated with Enzo Di Federico on 21 November 2014, 1 December 2014, 4 December 2014, 5 December 2014, 10 December 2014, 11 December 2014 and 12 December 2014, seeking signature of the documents.
On 27 November 2014, Mr Frassetto received an email from Mr Armstrong saying that he had completed a pre and post development flood model and had found that there would be an increase in flood levels along the southern property boundary. Mr Armstrong said that the Council would sometimes accept minor changes of the level, so it may be worth having a discussion with the Council. He said that the only other alternative was to remove some of the additional fill material so that there was a zero change in level at the property boundary. He suggested that that may only need some additional regrading to flatten the batter along the south western side of the channel, just upstream of the new road culverts.
On 2 December 2014, Mr Frassetto forwarded Mr Armstrong’s email to Mr Vince Morizzi (Mr Morizzi), saying that he would need to discuss with Mr Wayne Pope of the Council whether the Council would accept minor changes to the flood level of the boundary. Mr Frassetto said that, if that was rejected, the only option would be for the Di Federicos to remove some of the additional fill material to ensure that there was zero change in the flood level at the boundary.
On 4 December 2014, Simone Legal wrote to Marando Solicitors saying that their instructions were that approximately three weeks previously DGF had provided the transfer and plan of sub-division to the Di Federicos for execution. The letter asserted that the Di Federicos were under an obligation to do all that is necessary to enable registration of the plan of subdivision and that the continued delay was “unacceptable”. Simone Legal requested Marando Solicitors to arrange for execution of the documentation within seven days. Mr Frassetto and Enzo Di Federico met on 17 December 2014. However, the documents were not signed.
On 24 February 2015, Mr Armstrong of SEEC had sent an email to Mr Frassetto saying that he would be “back onto the reports” the following day and was sorry for the delay. On 27 February 2015, Mr Frassetto enquired of Mr Armstrong as to whether there had been any progress in the flood study report which, he said, DGF urgently needed to submit to Council. The draft report was sent by Mr Armstrong via email on the afternoon of 11 March 2015. Mr Frassetto forwarded the draft to Carlo and Mr Morizzi on the morning of 16 March 2015.
At a meeting of the Council held on 11 March 2015 attended by two engineers from the Council (including Mr Pope), Mr Howie of Britten and Associates, Enzo Di Federico, Carlo, Vince Morizzi and Mr Frassetto, the proposed subdivision was discussed. Minutes of the meeting record that a final flood report had been completed and submitted but that the Council was still awaiting a geotechnical report in relation to compaction testing of filling, which Enzo Di Federico was to provide. The minutes also record that Carlo was to provide details of the source and volume of the imported material and Mr Ewan Alexander, a surveyor from Frankham Engineering, was to prepare a statement of environmental effects to support a s 96 modification application for the imported fill, which was to be submitted by the Di Federicos. The minutes also recorded that the linen plan had been completed and had been submitted but required a cheque for the Council’s fees, that the s 88B instrument was completed and had been submitted and that an application would be made to Council for house number allocations.
The minutes also record that general discussion was held as to how to expedite the approval process for the linen plan of subdivision. The Council officers advised that, until the issues concerning the “unauthorised filling” on lots 11 and 12 had been resolved, the linen plan could not be approved. The minutes record that the only way the linen plan could be approved was if a restriction as to user in respect of lots 11 and 12 was added to the linen plan. The minutes record that it was agreed that that could be a reasonable option but all parties would need some time to consider their position before a final decision was made. At the meeting, Mr Morizzi said that he could not advise Enzo Di Federico to agree to the proposal suggested in the discussion recorded in the minutes unless DGF agreed “to pay for the cost of the fill”.
On 18 March 2015, Mr Pope of the Council rang Mr Frassetto and asked where the s 96 modification application was. Mr Pope said that he had been ordered to take action against the Di Federicos if it was not submitted. Mr Frassetto promised Mr Pope that he would lodge the application by Friday 20 March 2015.
On 20 March 2015, Mr Frassetto sent an email to Mr Alexander referring to the meeting with the Council on 11 March 2015 and saying that DGF urgently required a statement of environmental effects to support the proposed s 96 modification application and an application to the Council for the allocation of house numbers. On the same day, the Di Federicos executed the s 96 application, and Mr Frassetto met with the Di Federicos to receive two cheques for fees associated with the s 96 modification application.
On 23 March 2015, Mr Pope wrote to the Di Federicos on behalf of the Council. The letter asserted that the Council’s letter of 13 October 2014 had required a number of matters to be resolved with regard to the placement of illegal filling and that the further meeting held on 11 March 2015 reiterated the seriousness of placing the illegal filling and reminded Enzo Di Federico of the ramifications of ignoring the Council’s concerns. The letter asserted that it was agreed at the meeting that all the outstanding matters requested in Council’s letter of 13 October 2014 would be submitted no later than 20 March 2015 but that no s 96 modification application had yet been submitted.
The letter of 23 March 2015 then went on to request the Di Federicos to remove all of the illegal filling and comply with the following requirements:

1. remove the illegal filling to the pre-existing levels;

2. provide sedimentation control measures while removing the illegal filling;

3. provide the Council with a chain of custody for the removal of the illegal filling;

4. provide the Council with evidence that the illegal filling has been taken to an approved waste depot; and

5. provide the Council with a works-as-executed plan from a registered surveyor to the effect that the site had been restored to its natural levels prior to the placement of the illegal fill.

The letter stated that the required works and information were to be completed within 28 days or the Council would take the necessary legal steps to have the illegal material removed.

On 25 March 2015, Mr Frassetto sent an email to Carlo asking him to request Ewan Alexander to email him directly a copy of the environmental effect report, so that he could load it onto his USB stick together with all the other information requested by Mr Pope at their last meeting. Mr Frassetto picked up the USB from Carlo. Later that day, Mr Frassetto went to the Council and saw Mr Pope to lodge the s 96 modification application. Mr Pope said that he would not accept the application since he was still awaiting:

chain of custody information in relation to the fill material;

an amended and updated flood study; and

a final updated SOEE.

Still later on 25 March 2015, Carlo sent an email to Mr Frassetto to confirm that the USB stick and the s 96 modification application had been with the Council that day. Mr Frassetto replied to Carlo informing him that he had met with Mr Pope to submit the s 96 modification application, which was not accepted. He said that Mr Pope had kept the USB stick for consideration but said that he still needed:

chain of custody documentation;

a statement of environment effects, as discussed in the Council meeting; and

an updated flood study report, as discussed in the Council meeting.

Mr Frassetto said that Mr Pope would arrange a meeting with all the departmental heads on the following day to discuss the contents of the USB stick and would take advice as to whether they would accept the s 96 modification application.

On 9 April 2015, Mr Frassetto met with Carlo and handed to him the s 96 modification application that had been signed previously together with the two cheques that had been signed by the Di Federicos. Since that time, the s 96 modification application and the two cheques have remained in the possession of the Di Federicos at their home. Mr Frassetto told Carlo that Mr Pope had rejected the s 96 modification application until they could get all of the documents together but that the USB stick with the reports would be retained.
Also on 9 April 2015, DGF commenced the Specific Performance Proceedings against the Di Federicos. By the Specific Performance Proceedings, DGF sought specific performance of the 2013 Deed. At that time, the Di Federicos had still not signed the transfer documentation provided to them by Mr Frassetto on 18 November 2014.
DGF contends that, by commencing the Specific Performance Proceedings, it demonstrated a commitment to finalising the proposed subdivision despite the fact that, at that time, it was entitled to rescind all but one of the Contracts for Sale. It contends that the attitude of the Di Federicos had been flagrant and intransigent in that, in the absence of payment for the filling, they would not permit a resolution of the problem that DGF asserts was created by the Di Federicos.
However, the Di Federicos maintain that at that time DGF had failed to comply with its obligations under cl 4.3 of the 2013 Deed. They also suggest that DGF should have negotiated an agreement with them in accordance with the Council’s suggestion made on 11 March 2015 or should itself have lodged the s 96 modification application that had been signed by them.
Carlo was present when Mr Morizzi said to Mr Frassetto that, if DGF paid the money for the fill, the documents would be signed. However, Carlo was unable to point to any correspondence or bills or invoices sent to DGF in 2015 calling for payment of the sum of $140,000 as a condition of signing the relevant documents. Carlo agreed that the documents were not signed because the Di Federicos wanted a payment of $140,000. He accepted that no request for such a payment was made as a condition of signing the documents. Carlo was aware that Mr Frassetto had asked for the documents to be signed. He agreed that the reason they were not signed was because the Di Federicos wanted to be paid a sum of money from DGF in exchange for signing them, being the sum of $140,000. Carlo agreed that there had never been any suggestion that the resolve of the Di Federicos in not signing the documents without being paid had ever changed.
On 16 March 2015, SEEC provided a post-development flood study for the proposed subdivision determining the flood planning level for future dwellings to be constructed on the flood affected area, being lots 1, 2, 3, 11 and 12 adjoining Reedy Creek. The report concluded that flood modelling had been done for the “as built” conditions and provided relevant flood information necessary so that future dwellings can be appropriately located.
By notice dated 3 July 2015 (the s 121B Notice), the Council made an order in pursuance of the powers conferred by s 121B of the Environmental Planning and Assessment Act 1979 (NSW), that the Di Federicos do or refrain from doing the things set out in Schedule 1 within the time specified (the s 121B Order). Schedule 1 required that within a period of two calendar months, the Di Federicos must:

(i) remove all of the illegal fill material to return the Di Federicos’ land to the pre-existing levels;

(ii) provide the Council with a chain of custody for the removal of the illegal filling material;

(iii) provide the Council with evidence that the illegal filling material had been taken to an approved waste facility; and

(iv) submit to the Council evidence by way of updated surveyor’s report and works as executed plans to substantiate that the natural levels of the land have been restored to the levels that existed prior to the unlawful work being carried out.

The s 121B Notice stated that the circumstances giving rise to the exercise of the power were that the Di Federicos’ land had been substantially filled with material, being earth or soil, constituting development, without the prior approval of the Council, and no chain of custody and validation documentation had been provided to Council with reference to the location of the source of the material and the volume of imported material. The reasons for making the s 121B Order included that the landfill had a likely detrimental effect on adjoining properties in terms of ground water levels, surface run off, erosion, siltation, flow characteristics and flood behaviour, and that a flood report from a qualified consultant with regard to the effect of the filling to the immediate and surrounding areas had not been submitted to Council.
Enzo Di Federico responded to the s 121B Notice by letter of 18 August 2015, which had been drafted by Carlo. The letter attached what was said to be “all necessary documentation [C]ouncil has requested” and purported to reply to “all of the concerns that [C]ouncil has”. The letter went on to say as follows:

“The works completed on this site were done so under DA117.1/2009 and we believed to be allowed under this development. During filling on this site Reedy Creek has had no work carried out on either the original direction or its vegetation and has been left in its natural state. The property has been given an even minimum 0.5% fall to Reedy Creek; the fill on the property has improved the original flood levels and flood line that previously existed on Reedy Creek and the surrounding property. The property was filled due to the construction of the new road (Morrisey Place) which left the property in question with a depression in the property which before filling would flood and hold large amounts of water, in filling the property we alleviated this problem thus creating an even gentle slope to the creek and a uniformed subdivision.”

In December 2014, emails were exchanged between Mr Frassetto and Mr Butros concerning consent of DGF to the lodging of a development application. On 27 April 2015, Mr and Mrs Butros bought a parcel of land at Luddenham for $800,000, using the proceeds from the sale of their home. On 21 March 2016, they commenced building a house on the new parcel of land. That house is now completed and Mr and Mrs Butros have resided there since November 2016. Mr Butros does not suggest that he may not be able to obtain funds to complete the purchase of lot 1, but indicates that if he is unable to attain funds, he would sell lot 1 prior to the completion in the hope of making a capital gain.
On 30 April 2015, the Sunset Clause occurred. On 13 May 2016, some 12 months later, DGF gave the rescission Notice. Between June 2016 and August 2016, the solicitors for Mr and Mrs Butros and DGF exchanged correspondence concerning failure by DGF to perform its obligations under the Contract for Sale.

Scarvelis

In early 2014, Mr and Mrs Scarvelis began looking for a property to buy. They rejected one property in favour of the DGF development because they considered that it had a greater potential return on their investment. In July 2014, Mrs Scarvelis was told by DGF’s real estate agent that settlement would occur in November 2014. On 8 July 2014, Mr and Mrs Scarvelis sold their home for the purpose of being able to complete a purchase from DGF. They received approximately $210,000 after repayment of a loan secured on their home and moved in with Mr Scarvelis’ father, where they have remained until the present time.
On 21 July 2017, DGF entered into a Contract for Sale with Mr and Mrs Scarvelis in relation to lot 8 for the price of $880,000 with a 12 month sunset period. From July 2014 to May 2016, Mrs Scarvelis spoke to DGF’s real estate agent every month, and more frequently in later times, and was told “it will be another month’s time”.
In August and September 2014, Mr and Mrs Scarvelis sold and bought assets in preparation for completion of the Contract for Sale. In December 2014, their conveyancer was told that the proposed subdivision would not be completed until January. On 23 February 2015, their conveyancer received a facsimile from DGF’s solicitor saying that registration was unlikely to occur prior to May. In June 2015, their conveyancer inquired of DGF whether DGF would be prepared to extend the sunset date. No reply was received. The sunset date occurred on 20 July 2015.
On 9 December 2015, solicitors for Mr and Mrs Scarvelis requested an update. DGF’s solicitors replied saying that court orders made on 22 October 2015 put DGF in a position to complete the subdivision but that the Di Federicos had failed to comply with the orders. A request for an update in February and March 2016 was not responded to. In April 2016, Mr and Mrs Scarvelis’ daughter was enrolled in a school near Horsley Park.
On 13 May 2016, Mr and Mrs Scarvelis received the Rescission Notice. That was some 10 months after the sunset date occurred.
While Mrs Scarvelis contends that she would not have sold the Castle Hill property had she known that DGF might not be able to complete the Contract for Sale within a year, DGF contends that that assertion should not be accepted, since there was never any guarantee that the Contract for Sale would be completed either within the sunset period or at all. It asserts that selling assets in advance of a potential settlement of a conditional contract was inherently risky and that, in any event, in selling the Castle Hill property for $1,195,000 they were relieved of a liability for loan of over $1 million. DGF points out that not only have Mr and Mrs Scarvelis substantially decreased their debt, they have not been required to raise funds to pay the price for lot 8. DGF asserts that Mr and Mrs Scarvelis would make a very large gain for a very small outlay if rescission is not permitted.

Mihajlovic

On 1 March 2014, Mr and Mrs Mihajlovic sold for $115,000 a motor vehicle purchased as an investment. The sole purpose of that sale was to realise funds to complete the purchase of a parcel of land. On 28 April 2014, they sold their family home at Cecil Hills and received some $660,000 after repayment of a loan secured on that property.
In mid-2014, Mr and Mrs Mihajlovic began looking for land on which to build a house. DGF’s real estate agent told Mr Mihajlovic that lots in the proposed subdivision by DGF would be ready by the end of 2014. On 22 July 2014, Mr and Mrs Mihajlovic entered into a Contract for Sale with DGF in relation to lot 7 the price of $860,000 with a 6 month sunset period.
On 5 August 2014, Mr and Mrs Mihajlovic engaged a design company to draw up plans for a residence to be constructed on lot 7 and paid the design company the sum of $11,000. On 11 August 2015, they paid $1,210 for a survey of proposed lot 7. It is unclear whether the work done by the design company could be used elsewhere.
In September and October 2014, Mr and Mrs Mihajlovic’s conveyancers requested an update and requested consent for the lodgement of a development application. The conveyancers were informed that DGF expected registration of the plan of subdivision prior to Christmas. The sunset date occurred on 21 January 2015.
From June to August 2015, Mr and Mrs Mihajlovic’s conveyancers exchanged correspondence with DGF’s agent and DGF’s solicitors concerning progress with the proposed plan of subdivision. On 26 June 2015, Mr and Mrs Mihajlovic requested an extension of the sunset date. DGF’s solicitors responded on 15 July 2015 saying that DGF would not agree to an extension.
On 2 September 2015, Mr and Mrs Mihajlovic bought a property in Mount Vernon using funds realised from the sale of assets. Thereafter, various requests were made of DGF’s solicitors seeking an update but no response was received. On 13 May 2016, Mr and Mrs Mihajlovic received the Rescission Notice, 15 months after the occurrence of the Sunset Date.
While Mr Mihajlovic may not have sold the Cecil Hills property and his motor vehicles had he known that the Contract for Sale would not be completed before the Sunset Date, those assets were sold even before entering into the Contract for Sale. Further, Mr Mihajlovic conceded that he was aware how long it could take for development applications to be approved by the Council. He knew that the Council “dragged its feet”. That, is relevant to the risk that Mr and Mrs Mihajlovic took in entering into a conditional contract with a 6 month sunset clause.
Mr Mihajlovic is presently renovating the Mount Vernon property and has obtained development consent for an additional storey and a swimming pool. DGF asserts that, by owning that property since 2 September 2015, Mr and Mrs Mihajlovic have secured the capital gain that they would have obtained from completion of the Contract for Sale.

Noble

Mr and Mrs Noble own a residence at Abbotsbury. In mid-2014, they considered the purchase of two properties in Horsley Park but preferred the DGF development because of the size of the relevant lot, and the fact that the land was located in a new development where the houses would be new. On 2 August 2014, they entered into a Contract for Sale in relation to lot 2 for the price of $850,000 with a 6 month sunset period.
On 10 August 2014, Mr and Mrs Noble engaged Masterton Homes to carry out a survey and draw up plans for a new residence on lot 2 and paid approximately $4500. On 10 September 2014, they withdrew a sum in excess of $386,000 from superannuation to have funds ready for completion of the Contract for Sale. DGF contends that the Court should approach that assertion with some circumspection.
Between August 2014 and late 2015, DGF's agent told Mr Noble that the agent did not know what was causing the delay in registration of the plan of subdivision. In October 2014, Mr Frassetto told Mr Noble that the proposed plan of subdivision would be ready for registration before December. Mr Frassetto said in cross-examination that at the time he thought that that estimate was accurate.
On 26 November 2014, Mr and Mrs Noble paid Masterton Homes the sum of $11,834.56, representing 5% of the price for the house they were proposing to build on lot 2. It is not clear whether that payment can be applied in connection with the construction of a house on another site. On 29 March 2017, the Nobles were informed that the tender price for construction of the proposed house on lot 2 to had increased by some $43,350 since the time of the original arrangement with Masterton Homes.
In December 2014, Mrs Noble suffered a stroke. Since that time, Mrs Noble has difficulty with stairs. The Abbotsbury house is a two storey house and, accordingly, because of Mrs Noble’s disability, they will need to move to a single story dwelling.
On 1 August 2015, the sunset date of the Contract for Sale occurred. On 13 May 2016, DGF gave the Rescission Notice, some fifteen months after the sunset date. Thereafter, communications were exchanged between Mr and Mrs Noble’s solicitors and DGF’s solicitors concerning rescission.
DGF points to the fact that Mr Noble knew that completion of the purchase of lot 2 would not take place any earlier than December 2014 and was aware, thereafter, that there were delays. Therefore, there was no reason to withdraw superannuation funds before December 2014. Knowing that there were delays, Mr Noble could have, and should have, kept his superannuation funds until such time as completion appeared imminent.

Okan

In mid-2014, Mr and Mrs Okan were looking for a property to buy and considered three other properties in the Horsley Park area. They preferred the DGF development because of its location. In August 2014, DGF’s real estate agent told Mr Okan that registration of the proposed plan of subdivision would happen by the end of 2014. On 15 August 2014, Mr and Mrs Okan entered into a Contract for Sale in relation to proposed lot 3 for a total price of $840,000 with a 12 month sunset period.
On 16 October 2014, Mr and Mrs Okan sold an investment property to make funds available to complete the proposed purchase. They received $53,000 after payment of a loan secured on the property. In February 2015, Mr and Mrs Okan sold shares in IAG realising in excess of $6000 to have funds made available for completion. In late 2014 or early 2015, Mr and Mrs Okan paid $500 to Masterton Homes to prepare a site plan. On 28 February 2015, they paid $1,000 to Metricon as an initial deposit for the construction of a house. On 25 May 2015, they paid a further $4,000 to Metricon for construction of the home. On 2 October 2015, Mr and Mrs Okan signed the contract with Metricon for the construction of a house on the proposed lot 3.
In June 2015, Mr and Mrs Okan’s solicitors were informed by DGF’s solicitors that DGF was not in a position to complete because of factors beyond its control, explaining that DGF had commenced proceedings against a party to the proposed subdivision. On 14 August 2015, the Sunset Date occurred. On 30 September 2015, in response to a request for an update, Simone Legal referred to the Specific Performance Proceedings that were scheduled to commence on 22 October 2015.
In February 2016, Metricon informed Mr Okan that the price was to be reviewed and that he had to pay $1,000 per month if he wanted to keep the initial price. Given the uncertainty of registration of the plan of subdivision, Mr and Mrs Okan cancelled the contract with Metricon and were reimbursed the sum of $1,607.
On 19 March 2017, Mr and Mrs Okan and bought a property in Horningsea Park for $940,000. They moved there in May 2016 and continue to reside there. Mr Okan says that they intended to sell that property if their contract with DGF is not rescinded, although he expressed doubt about being able to afford to build on lot 3. DGF asserts that, in buying the Horningsea Park property in May 2016, Mr and Mrs Okan will enjoy a capital uplift in relation to that property. DGF contends that if rescission is not permitted, Mr and Mrs Okan would need to sell the Horningsea Park property in order to complete the Contract for Sale with DGF and possibly lease alternative premises while building works are taking place.

Azzopardi

In September 2014, DGF’s real estate agent told Mr Azzopardi that the proposed plan of subdivision would be registered before Christmas. On 25 October 2014, Mr and Mrs Azzopardi sold an investment party to make funds available to complete and build a house. They received a sum in excess of $130,000 after repayment of a loan secured on the investment property. They have retained those funds so as to be in a position to complete. On 30 October 2014, they entered into a Contract for Sale in relation to lot 6 for a price of $890,000 with a 12 month sunset period.
In late 2014, Mr and Mrs Azzopardi looked at home designs and chose one. In November 2014, their son was enrolled in childcare in Horsley Park.
On 29 October 2015, the Sunset Date occurred. On 13 May 2016, DGF gave the Rescission Notice, some seven months after the sunset date. In June and August 2016, solicitors for Mr and Mrs Azzopardi and the solicitors for DGF exchanged correspondence concerning rescission and DGF’s obligations under the Contract for Sale.

Section 66ZL(7)(g): Any other Relevant Matter

The Purchasers contend that this case is unusual in an important respect, in that DGF seeks to rescind while pursuing its case against the Di Federicos whom it asserts have been responsible for the delay. That suggests a significant tension in the proceedings. That is to say, it is clear that there has been delay. If the delay can be laid at the feet of DGF, DGF must accept the consequences that that may have in terms of whether the Court would be satisfied that it is just and equitable that any of the Contracts for Sale be rescinded. On the other hand, if, as DGF asserts, the delay was the result of breaches of contract by the Di Federicos, that may sound in a claim for damages. Either way, they say, the Contracts for Sale should not be rescinded: DGF should either bear the consequences of its own conduct or is entitled to be compensated by the Di Federicos for the delay.
Clearly enough, the damages to which DGF might be entitled would depend upon the way in which the Court exercised the discretion to permit rescission. If the Court concluded that DGF was not at fault, that may lead to the conclusion that it is just and equitable that DGF be permitted to rescind because of the detriment it might suffer as a consequence of being required to perform the Contracts for Sale. On the other hand, if DGF is entitled to be compensated by the Di Federicos for the loss that it might suffer by reason of being required to perform notwithstanding the passing of the sunset dates, it may not necessarily be just and equitable, as against the Purchasers, to permit it to rescind.
DGF points to possible financial loss that might follow if it is required to complete the Contracts for Sale. DGF has put forward five sets of accounts, each of which is inconsistent with the others. They were prepared by Mr De Bortoli and Mr Gelonesi. They are generally incomplete and none of them has been adopted in any formal sense by DGF. The Purchasers invite the Court to draw the inference that none of the sets of accounts is reliable. There is nothing about them to give any credence to them in light of the variations. In those circumstances, DGF’s true financial position is unknown and DGF has failed to prove an important, and perhaps necessary, component of its case. More particularly, it is by no means clear, if there is any evidence of the fact at all, that DGF has any liability to pay interest to investors who have provided funds to date.

Conclusion as to “Just and Equitable”

DGF must satisfy the Court that making orders permitting rescission of any one of the Contracts for Sale under s 66ZL would be just and equitable in all of the circumstances. However, the effect either of refusing or of permitting rescission could be arbitrary and unfair. Clearly enough, rescission could be highly prejudicial to a purchaser just as refusal of rescission could be highly prejudicial to the vendor. Accordingly, in many circumstances, the making or refusing of an order permitting rescission would be just and equitable only if the making or refusing of the order were to be on terms or conditions. For example, one possibility might be that, if a purchaser does not wish to consent to rescission, it would be just and equitable for a mechanism to be provided for the price payable for the subject lot to be increased, such that, if the purchaser failed to pay that price, it would be just and equitable to permit the vendor to rescind the contract.
In determining whether it is just and equitable in all of the circumstances pertaining to each of eight Contracts for Sale, the Court must have regard to the position of the respective Purchasers, on the one hand, and the position of DGF, on the other. That is to say the Court must be satisfied that it is just and equitable as between both parties to the relevant Contract of Sale that it is just and equitable for rescission to be permitted. That requires a consideration of the consequences of refusing permission so far as DGF is concerned, as well as considering the consequences of rescission from the point of view of each of the Purchasers.
The Di Federicos contend that DGF has not established that it is “just an equitable in the circumstances” for it to rescind the Contracts for Sale by reason of the following:

(a) DGF has acted unreasonably in seeking to rescind when it was itself in breach of its obligations under printed cl 28.2;

(b) DGF entered into all of the Contracts for Sale at a time when was in breach of its obligations to the Di Federicos under the 2013 Deed in relation to filling and re-grading and construction of the driveway;

(c) DGF entered into the Contracts for Sale in relation to lots 7 and 8 knowing that it was dispute with the Di Federicos regarding its obligations under the 2013 Deed;

(d) DGF entered into the Contract for Sale with respect to lot 3 knowing that, as a result of the dispute with the Di Federicos, the Di Federicos were introducing fill onto their property that had not been authorised by the Council;

(e) DGF entered into the Contract for Sale in relation to lot 6 knowing that it was aware that the s 121B Order had been made in relation to the filling activities being carried out by the Di Federicos;

(f) DGF acquiesced in the unauthorised filling carried out by the Di Federicos and failed to take any reasonable steps to ensure that such filling was carried out in a manner that would have allowed for the timely authorisation of that filling;

(g) DGF failed to take any steps to negotiate with the Di Federicos for a restrictive use covenant on the Di Federicos’ land so as to allow the registration of the proposed plan of subdivision;

(h) DGF failed exercise its contractual rights under the 2015 Agreement to complete the riparian works on the Di Federicos’ land or to cause the separation of the subdivision from the unauthorised fill restrictions;

(i) DGF failed to perform any works after October 2014 to progress the registration of the plan of subdivision other than the obtaining of a certificate for connection of electrical services on 8 September 2016;

(j) DGF has not demonstrated that it has suffered any loss, other than the obligation to pay land tax, by reason of the delay in completion of the Contracts for Sale;

(k) DGF will experience a considerable financial windfall, at the expense of the Purchasers, in the amount of $3,830,000 if each of the Contracts for Sale is rescinded.

It is of considerable relevance to know the source of the funds employed by DGF in acquiring its land and carrying out the development. Subscribed share capital, loans from financial institutions or loans from private investors would be possible sources.

Thus, in the event of loans being the source of funding, the precise terms of the loan would be relevant in order to determine what consequences would flow for DGF according to whether the Contracts for Sale were to be rescinded or completed according to their terms. For example, holding charges in the form of interest payable to a financial institution or a private investor will have been incurred by DGF. DGF would be expected to recoup such holding charges if it were able to rescind the Contracts for Sale and resell the lots at higher prices. Alternatively, private investors may have agreed to be rewarded by a share of profit following completion of the development. In that circumstance, there may be a question as to what the consequences for DGF would be if the Contracts for Sale were not rescinded.
Although there was some suggestion that the arrangement made by DGF with its investors was to share in the profit, I accept the evidence of Mr De Bortoli that investors were to be rewarded by the payment of interest at the rate of 8% per annum. Thus, the evidence indicates that loans from individual investors bearing that interest rate constituted the only source of funding. As I have said, the records as to DGF’s financial position from the commencement of the development up to the date of the hearing are anything but clear. It is well-nigh impossible to be satisfied as to the financial consequences for DGF according to whether the Contracts for Sale are rescinded or are to stand.
Individual Purchasers will be affected differentially. Some Purchasers may have been in a financial position to re-enter the market once the sunset date was reached. On the other hand, the financial position of other Purchasers may have been such as to preclude such Purchasers from re-entering the market without the deposit that had been paid to DGF under their Contracts for Sale. Both DGF and the Purchasers accept that each of the Purchasers must be considered separately. It is possible that the Court could make an order permitting DGF to rescind one or more of the Contracts for Sale but not all of them.
As I have indicated, DGF proffered an undertaking formulated to afford the Purchasers a share of any increase in value of their respective lots over the sale prices in the Contracts for Sale. That procedure, however, would not guarantee that a particular Purchaser would be able to acquire the subject lot that that Purchaser had contracted to buy. The proposal formulated by DGF assumes that the Court will make an order permitting rescission of all of the eight Contracts for Sale and makes no provision for differential treatment for individual Purchasers.
The Purchasers assert that it is not only developers who manipulate the progress of the development who are disentitled from rescinding. Thus, a vendor who seeks an order under s 66ZL must demonstrate that rescission is just and equitable in the circumstances and must show a reason for permitting rescission. Further, the reason for the delay is only one of the mandatory considerations and it is not expressed in terms of manipulation by a developer. Further, it does not follow, from the fact that developers who manipulate the sunset date are not permitted to rescind, that it is only developers who manipulate the sunset date who are not permitted to rescind.
It is very difficult, for the reasons indicated above, to determine precisely what the consequences for DGF will be if permission to rescind is refused. Clearly, DGF has incurred holding charges in relation to each of the eight lots in the proposed subdivision from the dates of occurrence of the respective sunset dates up to the time of the hearing. It would not have incurred those costs if the proposed plan of subdivision had been registered before the occurrence of the sunset dates. DGF’s conduct of the development generally has been less than entirely efficient and competent. However, I do not consider that DGF’s conduct can be characterised as falling within the practices described by the Minister in the Second Reading Speech. I do not consider it to have acted in bad faith or unreasonably.
It is common ground that the value of each lot in the proposed subdivision has increased significantly since the dates of the respective Contracts for Sale and is significantly higher than the price provided for in the relevant Contract for Sale. While the delays in registration of the proposed plan of subdivision may have worked to the detriment of most of the Purchasers in not insignificant respects, the Purchasers have also derived an advantage or benefit in so far as the time for the payment of the price under the Contracts for Sale has been deferred.
It is significant that each of the Contracts for Sale was entered into a considerable period of time before any announcement was made that s 66ZL would be enacted. Indeed, the sunset date under each of the Contracts for Sale had occurred prior to 2 November 2015, when the legislation was announced. The Minister expressly acknowledged the retrospective operation of the proposed amendment.
At the time when each of the Purchasers entered into their respective Contracts for Sale, the Purchasers accepted the risk that, if the value of the lots in the proposed subdivision increased, they might lose the benefit of that increase if the proposed plan of subdivision was not registered before the occurrence of the sunset date. On the other hand, it is fair to conclude that none of the Purchasers was informed of the possible risks that disputes between DGF and the Di Federicos might bear upon whether or not the proposed plan of subdivision was registered before the relevant sunset date.
Notwithstanding the differences between the circumstances of the various Purchasers, I have concluded that, if DGF gives to the Court an undertaking along the lines described below, it would be just and equitable to permit DGF to rescind each of the Contracts for Sale by notice in writing given within 14 days. If such an undertaking is not proffered on behalf of DGF within 14 days, the application for an order permitting rescission of the Contracts for Sale will be dismissed. In determining whether it is “just and equitable” in all the circumstances to make an order permitting the vendor to rescind the contract, I consider that the existence and terms of an undertaking proffered by the vendor is a matter which the Court may take into account under s 66ZL(7)(g).
The undertaking to be given by DGF would be along the following lines:

1. DGF will, as soon as is reasonably possible, and in any event no later than 60 calendar days from date of the final orders, do all such acts and things, execute all such documents and pay all such fees as may be necessary to procure the registration of the proposed plan of subdivision by LPI including, but not limited to:

(a) lodge any necessary application to the Council for variation of Development Consent Nos 1171.1 of 2009 and 1171.3 of 2009 in order to accommodate the fill currently on proposed lots 11 and 12;

(b) lodge any necessary application to the Council for consent to the proposed subdivision;

(d) meet any requisitions raised by the Council or by LPI in relation to any of the above.

2. DGF will at the same time as giving any notice of rescission to a Purchaser or Purchasers in respect of any of the Contracts for Sale, make an offer in writing to such Purchaser or Purchasers to enter into a new contract for the sale and purchase of the proposed lot that is the subject of the rescinded Contract for Sale on the same terms as the rescinded Contract for Sale except that:

(a) The price to be paid under any such new contract will be the price payable under the rescinded Contract for Sale together with a sum calculated on the balance of the purchase price payable under the rescinded Contract for Sale from 16 May 2017 until the date of acceptance of the offer (and the making of a new contract for sale) at an appropriate rate;

(b) Any provision relating to rescission of the Contract for Sale by reason of the proposed plan of subdivision not being registered will be deleted;

(c) The amount of the deposit payable under any new contract will be the amount of the deposit paid under the rescinded Contract for Sale.

3. DGF will not withdraw any such offer prior to the expiration of 28 days after the making of the offer.

4. DGF will apply the deposit paid under any rescinded Contract of Sale as the deposit payable under any Contract for Sale entered into as a consequence of acceptance of such an offer.

DGF is incurring interest at the rate of 8% per annum. On the other hand, the saving to Purchasers would be the usual rate for home loans. I consider the date of 16 May 2017 to be appropriate on the basis that the Di Federicos will be ordered to compensate DGF for damage occasioned by the delay up to that date. I will hear the parties further, if they wish, on the appropriate rate and the period for which the rate should be applied.
By such an arrangement, DGF would be compensated in respect of the Contracts for Sale that are completed for being out of pocket to the extent of the balance of the purchase price. On the other hand, each of the Purchasers would have the opportunity of completing the purchase of the proposed lot at the higher price notwithstanding that the Purchaser was prepared to accept the risk at the time of entering into the Contract for Sale that DGF might be entitled to rescind it if the plan of subdivision was not registered before the sunset date. Further, by reason of the delay in completion of the sale and purchase of proposed lots, the Purchasers have either had the use of the balance of the purchase price or have not been required to borrow to pay the balance of the purchase price.

Costs

I do not consider that any of the Purchasers have unreasonably withheld consent to rescission. The undertaking proffered on behalf of DGF came very late in the proceedings, being proffered during the hearing. I am therefore not persuaded that the presumption contained in s 66ZL, that the vendor should pay the costs of a purchaser in respect of an application for permission under s 66ZL has been rebutted. The proposal for the Purchasers to agree to pay an additional sum was not ventilated during the hearing. DGF should therefore pay the costs of the Purchasers of the Rescission Proceedings.
DGF seeks an order that the Di Federicos pay both DGF’s costs of the Rescission Proceedings and pay any amount that DGF is ordered to pay to the Purchasers in respect of their costs of the Rescission Proceedings. DGF contends that it was not unreasonable, by May 2016, to seek to rescind in light of its financial situation, the ongoing delay and the continued failure by the Di Federicos to perform their obligations. It contends that if the Di Federicos’ land had not been involved, the delays from 2014 to 2017 would not have occurred.
DGF could have rescinded without any order of the Court at the times when the respective sunset dates occurred. Section 66ZL took effect from 2 November 2015. By that stage, DGF was entitled to rescind all of the Contracts for Sale. The last sunset date, for Mr and Mrs Azzopardi, had occurred on 29 October 2015, albeit only days before the commencement of s 66ZL. Nevertheless, DGF did not take steps to rescind the Contracts of Sale until 13 May 2016. In those circumstances, I am not persuaded that, if the Di Federicos had not committed breaches of their obligations, DGF would have been able to rescind the Contracts for Sale. I do not consider that any breach by the Di Federicos has occasioned the order for costs that should be made in favour of the Purchasers.
DGF has been partially successful as against the Di Federicos. It is entitled to damages as indicated. I consider that the appropriate order is that the Di Federicos pay DGF’s costs of the Specific Performance Proceedings but that there be no order as between DGF and the Di Federicos in relation to the Rescission Proceedings. However, I will hear the parties further, if any party wishes to make submissions, on the question of costs generally or on the question of the apportionment of costs as between the Specific Performance Proceedings and the Rescission proceedings.

Orders

I propose to make the following directions:

1. DGF notify the Court and the Di Federicos in writing within 14 days of its calculation of the amount of damages in accordance with the above reasons.

2. The Di Federicos notify DGF in writing within 14 days after receipt of such notification whether they wish to dispute the calculation of such damages.

3. DGF notify the Court and each of the Purchasers in writing within 14 days whether it proposes to proffer an undertaking to the Court along the lines indicated in the above reasons.

4. Each party notify all other parties within 14 days whether that party wishes to make any submissions in relation to:

costs and the apportionment of costs as between the Rescission Proceedings and the Specific Performance Proceedings;
the appropriate rate for the adjustment of the purchase price; and
the period for which the rate should be applied.

5. The proceedings be listed for further directions on a date convenient to the parties and the Court for the purpose of making further orders for the final disposition of both proceedings.

**********

Appendix 1

Lot Number in proposed subdivision

Date of Contract for Sale

Purchaser

Sunset date

Price in Contract for Sale

Value of lot at 18 October 2017

Value of Lot at 22 April 2016

1

1.5.2014

Marianna Butros and Bolos Butros

30.4.2015 (12 months from date of agreement)

$850,000

$1.425 million

$1.275 million

2

2.8.2014

Peter Alec Noble and Diane Cecelia Noble

2.2.2015 (6 months from date of agreement)

$850,000

$1.4 million

$1.25 million

3

15.8.2014

Zafer Okan and Nuran Okan

14.8.2015 (12 months from date of agreement)

$840,000

$1.4 million

$1.25 million

4

17.2.2014

Joe Pijaca and Gloria Pijaca

16.2.2015 (12 months from date of agreement)

$725,000

$1.5 million

$1.25 million

5

20.2.2014

Samantha Panuccio

19.2.2015 (12 months from date of agreement)

$650,000

$1.45 million

$1.3 million

6

30.10.2014

Mark Anthony Azzopardi and Raquel Azzopardi

29.10.2015 (12 months from date of agreement)

$890,000

$1.45 million

$1.3 million

7

22.7.2014

Stiven Mihajlovic and Linda Maria Mihajlovic

21.1.2015 (6 months from the date of agreement)

$860,000

$1.475 million

$1.325 million

8

21.7.2014

Michael Scarvelis and Tanya-Marie Scarvelis

20.7.2014 (12 months from date of agreement)

$880,000

$1.475 million

$1.325 million

Appendix 2

2013 Plan

See next page.

Endnotes

Decision last updated: 23 March 2018

Medium Neutral Citation:	DGF Property Holdings Pty Limited v Di Federico; DGF Property Holdings Pty Limited v Butros [2018] NSWSC 344
Hearing dates:	20, 21, 22, 23, 24 November 2017; Submissions 12 March 2018
Decision date:	23 March 2018
Jurisdiction:	Equity
Before:	Emmett AJA
Decision:	1. The plaintiff (DGF) notify the Court and the defendants in proceedings 2015/105403 (the Di Federicos) in writing within 14 days of its calculation of the amount of damages in accordance with the reasons published today. 2. The Di Federicos notify the Court and DGF in writing within 14 days after receipt of such notification whether they wish to dispute that the calculation of such damages has been made in accordance with the reasons. 3. DGF notify the Court and each of the First to the Fifteenth Defendants in proceedings 2016/246532 (the Purchasers) in writing within 14 days whether it proposes to proffer an undertaking to the Court along the lines indicated in the reasons published today. 4. Each party notify all other parties within 14 days whether that party wishes to make any submissions in relation to: (i) costs and the apportionment of costs as between proceedings 2016/246532 and proceedings 2015/105403; (ii) the appropriate rate for the adjustment of the purchase price; and (iii) the period for which the rate should be applied. 5. Both proceedings be listed for further directions on a date convenient to the parties and the Court for the purpose of making further orders for the progress and final disposition of both proceedings.
Catchwords:	REAL PROPERTY – vendor sought rescission of eight off the plan contracts – vendor applied under s 66ZL of the Conveyancing Act 1919 for orders permitting rescission in the absence of purchaser consent – whether right to rescind arose – whether vendor had lost right to rescind by failing to exercise right to rescind at an earlier time – whether court should exercise discretion to permit vendor to exercise contractual right to rescind – whether vendor satisfied the Court that making orders permitting rescission would be just and equitable in all the circumstances
Legislation Cited:	Conveyancing Act 1919 (NSW) Water Management Act 2000 (NSW)
Cases Cited:	Al Achrafi v Topic [2016] NSWSC 1807 Immer (No 1450) Pty Ltd v Uniting Church of Australia Property Trust 182 CLR 26 New Zealand Shipping Co v Société des Ateliers et Chantiers de France [1919] AC 1 Sargent v ASL Developments Limited (1974) 131 CLR 364 Suttor v Gundowda Pty Ltd (1950) 81 CLR 418
Texts Cited:	Handley: Estoppel by Conduct and Election (Sweet and Maxwell, 2016, 2nd ed)
Category:	Principal judgment
Parties:	In Matter No 2015/105403 DGF Property Holdings Pty Limited (Plaintiff and First Cross Defendant) Enzo Di Federico (First Defendant and First Cross Claimant) Franca Di Federico (Second Defendant and Second Cross Claimant) In Matter No 2016/246532 DGF Property Holdings Pty Limited (Plaintiff) Marianna Butros (First Defendant) Bolos Butros (Second Defendant) Peter Alec Noble (Third Defendant) Diane Cecelia Noble (Fourth Defendant) Zafer Okan (Fifth Defendant) Nuran Okan (Sixth Defendant) Joe Pijaca (Seventh Defendant) Gloria Pijaca (Eighth Defendant) Samantha Nicole Gina Panuccio (Ninth Defendant) Mark Anthony Azzopardi (Tenth Defendant) Raquel Azzopardi (Eleventh Defendant) Stiven Mihajlovic (Twelfth Defendant) Linda Maria Mihajlovic (Thirteenth Defendant) Michael Scarvelis (Fourteenth Defendant) Tanya-Marie Scarvelis (Fifteenth Defendant) Enzo Di Federico (Sixteenth Defendant) Franca Di Federico (Seventeenth Defendant)
Representation:	Counsel: In Matter No 2015/105403 G Sirtes SC with Mr PM Barham (Plaintiff) MA Ashhurst SC with D S Weinberger (First and Second Defendants) In Matter No 2016/246532 G Sirtes SC with PM Barham (Plaintiff) JC Giles SC with H Mann (First to Eighth; Tenth to Fifteenth Defendants) Mr D Allen (Ninth Defendant) MA Ashhurst SC with David S Weinberger (Sixteenth and Seventeenth Defendants) Solicitors: In Matter No 2015/105403 Simone Legal (Plaintiff) Mills Oakley (First and Second Defendants) In Matter No 2016/246532 Simone Legal (Plaintiff) Dentons (First to Eighth; Tenth to Fifteenth Defendants) Russo & Partners (Ninth Defendant) Mills Oakley (Sixteenth and Seventeenth Defendants)
File Number(s):	2015/105403; 2016/246532

Lot Number in proposed subdivision	Date of Contract for Sale	Purchaser	Sunset date	Price in Contract for Sale	Value of lot at 18 October 2017	Value of Lot at 22 April 2016
1	1.5.2014	Marianna Butros and Bolos Butros	30.4.2015 (12 months from date of agreement)	$850,000	$1.425 million	$1.275 million
2	2.8.2014	Peter Alec Noble and Diane Cecelia Noble	2.2.2015 (6 months from date of agreement)	$850,000	$1.4 million	$1.25 million
3	15.8.2014	Zafer Okan and Nuran Okan	14.8.2015 (12 months from date of agreement)	$840,000	$1.4 million	$1.25 million
4	17.2.2014	Joe Pijaca and Gloria Pijaca	16.2.2015 (12 months from date of agreement)	$725,000	$1.5 million	$1.25 million
5	20.2.2014	Samantha Panuccio	19.2.2015 (12 months from date of agreement)	$650,000	$1.45 million	$1.3 million
6	30.10.2014	Mark Anthony Azzopardi and Raquel Azzopardi	29.10.2015 (12 months from date of agreement)	$890,000	$1.45 million	$1.3 million
7	22.7.2014	Stiven Mihajlovic and Linda Maria Mihajlovic	21.1.2015 (6 months from the date of agreement)	$860,000	$1.475 million	$1.325 million
8	21.7.2014	Michael Scarvelis and Tanya-Marie Scarvelis	20.7.2014 (12 months from date of agreement)	$880,000	$1.475 million	$1.325 million