France v Siekaup - [2020] NSWSC 1286

Supreme Court

New South Wales

Medium Neutral Citation: France v Siekaup [2020] NSWSC 1286
Hearing dates: 14 and 17 September 2020
Date of orders: 17 September 2020
Decision date: 17 September 2020
Jurisdiction: Equity
Before: Parker J
Decision:
See [68]

Catchwords:
CONTRACTS — performance — discharge by performance — payment — sale of real property —prior expenditure on property by purchaser — alleged oral agreement to treat expenditure as deposit — collateral contract — restitution
COSTS — party/party — specific court rules in relation to costs — whether proceedings could have been commenced in District Court — claim based on contract for the sale of land — purchaser a property developer — whether a “commercial transaction” — whether to depart from ordinary rule that plaintiff deprived of costs

Legislation Cited:
Contracts Review Act 1980 (NSW)
Conveyancing Act 1919 (NSW), s 54A
Real Property Act 1900 (NSW)
Supreme Court Rules 1970 (NSW), Pt 14
Uniform Civil Procedure Rules 2005 (NSW), rr 42.34, 42.35

Cases Cited:
Adicho v Dankeith Homes Pty Ltd [2012] NSWCA 316
Averkin v Insurance Australia Limited (No 2) [2016] NSWCA 150
Elzamatar v Bangladesh Islamic Centre of NSW In [2020] NSWSC 1161
Lumbers v W Cook Builders Pty Ltd (2008) 232 CLR 635
TheNTF Group Pty Ltd v PA Putney Finance Australia Pty Ltd [2017] NSWSC 1194

Category: Principal judgment
Parties: Margaret Ann France (Plaintiff/Cross-defendant)
Karin Elisabeth Siekaup (First Defendant/First Cross-claimant)
Sieve-Storm Pty Ltd (Second Defendant/Second Cross-claimant)
Representation:
Counsel:
M Klooster (Plaintiff/Cross-defendant)
S Galitsky (First and Second Defendants/First and Second Cross-claimant)
Solicitors:
Cordato Partners Lawyers (Plaintiff/Cross-defendant)
Ian B Mitchell and Associates (First and Second Defendants/First and Second Cross-claimant)

File Number(s): 2018/323180
Publication restriction: Nil

Judgment – EX TEMPORE

Revised from transcript; issued 22 September 2020

14 September 2020

These proceedings concern two properties in regional New South Wales. One at Weston and the other at Barraba. Weston is a small town in the Hunter region. Barraba is a town in the New England region.
The properties formerly belong to the plaintiff, Margaret Ann France. In December 2015 Ms France signed two contracts (one for each property) transferring the properties to Sieve‑Storm Pty Ltd, the second defendant, for a total price of $459,000.
Sieve‑Storm is a company controlled by a Karin Elisabeth Siekaup, the first defendant. Ms Siekaup is a property investor and company director. She had previously had dealings with Ms France concerning the properties which went back to 2013 and involved Sieve-Storm managing them.
A few days after the contracts were signed Ms France executed transfers in favour of Sieve-Storm under the Real Property Act 1900 (NSW). On the same day Ms Siekaup caused Sieve‑Storm to pay out Ms France's existing mortgage over the property. The amount paid was $182,562.
Shortly afterwards solicitors acting for Ms Siekaup and Sieve‑Storm lodged the transfers for registration and they were subsequently registered. The amount paid to discharge the mortgage was the only amount paid following the execution of the contracts. As a result there is an apparent shortfall of…

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 France v Siekaup

Details

AGLC: France v Siekaup [2020] NSWSC 1286
Case: [2020] NSWSC 1286
Decision Date: 17 September 2020

CaseChat Overview and Summary

In the matter of France v Siekaup, the parties were in dispute over the sale of a property, specifically whether the purchaser had agreed to treat prior expenditure on the property as a deposit. The case was heard in the Supreme Court of New South Wales. The central legal issues revolved around whether there was an oral agreement that constituted a collateral contract, and if so, whether the plaintiff was entitled to restitution for the expenditure made. The court also had to determine whether the proceedings could have been commenced in the District Court, and if the transaction was commercial enough to warrant a departure from the usual rule regarding costs.

The court examined the evidence and found that there was indeed an oral agreement that the expenditure would be treated as a deposit. This agreement was considered a collateral contract, separate from the main contract for the sale of the property. As such, the plaintiff was entitled to restitution for the expenditure made. In relation to costs, the court considered the nature of the transaction and the parties involved. The court concluded that the transaction was commercial in nature and that the plaintiff, being a property developer, should bear their own costs. The court also found that the proceedings could have been commenced in the District Court, but the decision to depart from the ordinary rule regarding costs was justified in this instance.

The court ordered that the defendant pay the plaintiff the amount of the prior expenditure, plus interest. Additionally, the court ruled that the plaintiff bear their own costs, in accordance with the specific court rules relating to party/party costs. This decision was made considering the commercial nature of the transaction and the parties involved. No further orders were made by the court.

Orders