Gaggin v Lemari
[2000] NSWSC 856
•8 August 2000
Reported Decision: [2000] 10 BPR 18,381
(2001) NSW ConvR 56-002
New South Wales
Supreme Court
CITATION: Gaggin v Lemari [2000] NSWSC 856 CURRENT JURISDICTION: Equity Division FILE NUMBER(S): SC 3167/2000 HEARING DATE(S): 08/08/2000 JUDGMENT DATE: 8 August 2000 PARTIES :
Janelle Mary Gaggin (P1)
Harry Thomas Johnson (P2)
Russell Paul Lemari (D1)
Golden Key Real Estate Pty Ltd t/as Richardson & Wrench Strathfield (D2)
Westpac Banking Corporation (D3)JUDGMENT OF: Young J
COUNSEL : P Walsh (P)
D R Pritchard (D3)SOLICITORS: Paton Lawyers (P)
Henry Davis York (D3)CATCHWORDS: CONVEYANCING [67]- Contract for sale- 1996 edition cl 20.6.3- Insufficient to authorise summons to be served on solicitor named in contract. DECISION: See para 12
THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
YOUNG J
TUESDAY 8 AUGUST 2000
3167/2000 - GAGGIN v LEMARI
JUDGMENT
1 HIS HONOUR: These are proceedings brought by the vendors of a property at Strathfield against the purchaser for a declaration that the contract for sale has been terminated and that the deposit has been forfeited.
2 The contract was entered into in the 1996 edition of the standard form on 18 February 2000. The purchase price was $750,000 and a deposit of $75,000 was paid by the first defendant, the purchaser, to the agent, Richardson & Wrench at Strathfield. The contract nominated the completion date as the 42nd day after the date of the contract, which was 31 March 2000.
3 The purchaser's solicitors asked for requisitions on title shortly after exchange and these were answered on 28 February 2000. There was no demur to any of the answers. A draft transfer was signed and the vendors appear to have done everything necessary to arrange for completion.
4 Shortly before 31 March 2000 the vendors' solicitors spoke to the purchaser’s solicitors nominating a place for settlement. There were then telephone conversations between the solicitors to the effect that the purchaser’s money had been frozen by court order and he could not complete.
5 On 3 April 2000, pursuant to the authority given by clause 15 of the contract, the plaintiffs issued a notice to complete. This was a fourteen or fifteen day notice. Additional clause 31 of the contract provided for a fourteen day notice.
6 The vendors' solicitors again fixed a time and place for completion on 18 April 2000. During the conversation between the solicitors it was made clear that the purchaser was not able to complete. On 18 May 2000 the vendors terminated the contract.
7 The current summons was issued on 12 July 2000.
8 The matter has been listed today along with three other sets of proceedings affecting the first defendant. In those other proceedings a solicitor appeared for the first defendant. No solicitor appears for the first defendant in the current proceedings. However, it is quite clear from:
(a) the affidavit of Keith Williams, sworn 1 August 2000, paragraph 25; and
(b) the fact that the solicitor for the first defendant was present in court when this matter was mentioned this morning
that the summons has come to the first defendant's notice.
9 The summons was also served on the solicitors for the first defendant who acted on the conveyance who were not the solicitors who appeared for him in the other proceedings this morning. Mr Peter Walsh, who appeared for the plaintiffs, put that clause 20.6.3 of the contract operated as a sufficient agreement that the summons would be served on such solicitors. Clause 20.6.3 merely says "A document under or related to this contract is served if it is served on the party's solicitor, even if the party has died or any of them has died". I do not consider that that is sufficient to activate Part 9 rule 9 of the Supreme Court Rules which covers the case where a defendant has agreed that an originating process in proceedings may be served in a particular way, by a contract made before the action is brought. That rule is really there to cover situations such as Lloyds’ policies, where policies of insurance nominate lawyers who may be served because one never knows the names with whom one is really dealing: see the note in Supreme Court Practice at 9.9.1. The words in the contract would need to be much expanded to cover the court process if it is desired that clause 20.6.3 cover the present situation.
10 However, in all the circumstances I am satisfied that the proceedings have come to the notice of the first defendant and confirm informal service under Part 9 rule 11 of the Supreme Court Rules.
11 On the evidence before me, the parties agreed that either party could make time of the essence if the contract was not completed by 31 March 2000. The plaintiffs’ notice to complete has made time of the essence. The first defendant has not complied with the notice and so breached an essential term of the contract and this entitles the plaintiffs to terminate.
12 I have perused the conveyancing file which has been tendered. There is no suggestion in it that there was any conduct of the plaintiffs disentitling them to rely on their contractual rights to issue a notice to complete. Accordingly:
1. I confirm the informal service on the first defendant.
2. I make orders 1 and 2 in the summons.
3. I order that the first defendant pay the plaintiffs’ costs to date.
4. I stand over the balance of the proceedings to 5 September 2000 at 9.50am before me.
5. The exhibits may be returned except for the copy contract marked PX01 which is to be kept in the file in case I need to have reference to it on the next occasion.
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