Gajic & Anor v Poyser

In *Gajic & Anor v Poyser*, the High Court of Australia considered a dispute concerning the interpretation of a clause within a contract for the sale of land. The purchasers, Mr Gajic and his wife, sought to terminate the contract, alleging that the vendor, Ms Poyser, had failed to comply with a condition precedent. The core of the dispute revolved around whether Ms Poyser had taken all reasonable steps to obtain a necessary planning permit for the property by the stipulated date.

The High Court was required to determine whether the purchasers were entitled to terminate the contract on the basis that the vendor had breached the condition precedent. Specifically, the Court had to ascertain the correct legal test for assessing whether a party has taken "all reasonable steps" in the context of a contractual obligation to obtain a permit, and whether the vendor's actions met this standard.

The Court held that the purchasers were not entitled to terminate the contract. Crennan J, delivering the judgment, clarified that the "all reasonable steps" clause imposed an objective standard of conduct. This required the vendor to take all steps that a reasonable person in her position would take to obtain the permit, even if those steps were not ultimately successful. The evidence demonstrated that the vendor had actively engaged with the planning authorities, responded to their requests, and made genuine efforts to satisfy the permit requirements. Her Honour found that the vendor's conduct satisfied the contractual obligation, and therefore, the purchasers could not rely on the alleged breach to terminate the agreement.