mission for demolition of houses-Contract made in ignorance of order-Loss to be borne by purchaser-Stum Reclamation and Housing Act 1938 (Vict.) (No. 4568), sec. 8. "

Pursuant to the provisions of sec. 8 of the Slum Reclamation and Housing Act 1938 (Vict.), on 8th March 1940 the Housing Commission declared a terrace of houses erected upon certain land to be unfit for human habitation and directed its demolition. On 21st March a contract of sale of the land, together with brick terrace erected thereon," was entered into, all the parties thereto being ignorant of the declaration. The commission posted notice of the declaration on 1st April, and it was received by the vendor on 3rd April. In answer to requisitions the vendor disclosed the receipt of the notice, and pursuant to the notice received by him he demolished the terrace. The purchasers refused to complete and demanded rescission of the contract and return of the deposit paid. The Slum Reclamation and Housing

owner a copy of such declaration Act 1938 (Vict.) provides, by see. 8 :-

together with a statement in writing

64 CLR 38

Held, by Starke, Dixon and McTiernan JJ., (Rich A.C.J. dissenting), that under sec. 8 the direction to demolish the terrace did not become effective until its receipt by the vendor on 3rd April, when the purchasers were the equitable owners of the land; accordingly, it afforded no reason for refusing to accept title, as the property was at the purchasers' risk at that date, and they-should bear the loss occasioned by the demolition.

Decision of the Supreme Court of Victoria (Lowe J.): In re Manton and Fletcher's Contract, (1940) V.L.R. 374, affirmed.

APPEAL from the Supreme Court of Victoria.

By a contract of sale, dated 21st March 1940, Russell Manton sold to John Hamlyn Fletcher and Florence Hilda Fletcher " all that piece of land being more particularly described in certificate of title volume 3414 folio 682764 together with brick terrace erected thereon and known as Nos. 15, 17, 19, 21 Lt. Charles Street, Abbotsford" for the sum of £600, payable by a deposit of £100 on the signing of the contract and the balance within four months. By the special conditions the purchasers were entitled to all rents and profits from the property upon completion of payment of the balance of purchase money and the property was sold subject to all existing tenancies. Subject to the special conditions, the conditions in Table "A" of the Transfer of Land Act 1928 (Vict.) were to apply to the contract.

Pursuant to the provisions of sec. 8 of the Slum Reclamation and Housing Act 1938 (Vict.) the Housing Commission of Victoria, on 8th March 1940, declared that after making due inquiries and obtaining all necessary reports it was satisfied that the above- mentioned houses did not comply…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Fletcher v Manton

Details

AGLC: Fletcher v Manton [1940] HCA 32
Case: [1940] HCA 32
Decision Date: 25 November 1940

CaseChat Overview and Summary

This case concerned a dispute between a vendor, Russell Manton, and purchasers, John Hamlyn Fletcher and Florence Hilda Fletcher, regarding a contract for the sale of land with a brick terrace of houses. The core of the disagreement arose after the Housing Commission of Victoria declared the houses unfit for human habitation and ordered their demolition, a fact unknown to both parties at the time of the contract. The purchasers sought to rescind the contract and recover their deposit, while the vendor maintained the contract was binding. The matter was heard on appeal from the Supreme Court of Victoria.

The legal issues before the High Court of Australia were whether the demolition order constituted a defect in title that entitled the purchasers to rescind the contract, and when, under the Slum Reclamation and Housing Act 1938 (Vict.), the demolition order became legally effective and binding on the property. Specifically, the court had to determine if the order attached to the land at the time of the Housing Commission's declaration or only upon service of the notice on the owner.

A majority of the High Court, comprising Starke, Dixon, and McTiernan JJ., held that the demolition order did not become legally effective until it was received by the vendor on 3rd April 1940. As the contract of sale was entered into on 21st March 1940, the purchasers were considered the equitable owners of the land at the time the demolition order became operative. Applying the principle that property is at the purchaser's risk from the date of the contract, the court found that the purchasers should bear the loss occasioned by the demolition. Rich A.C.J. dissented, viewing the commission's declaration as immediately attaching a disability to the premises from the date of the declaration itself.

The appeal was dismissed, affirming the decision of the Supreme Court of Victoria. The purchasers were therefore not entitled to rescind the contract, and the loss resulting from the demolition of the houses was to be borne by them.

Orders