Gold v The Proprietors - Unit Plan No 52

Gold (the applicant) sought an order from Toohey J, sitting in chambers, to set aside a decision of the respondent, The Proprietors - Unit Plan No 52. The dispute concerned the respondent's refusal to approve a proposed transfer of a unit within the unit plan. The applicant had entered into a contract to purchase a unit, but the respondent, acting under its by-laws, had refused to consent to the transfer of ownership.

The central legal issue before the court was whether the respondent's refusal to approve the transfer was unreasonable. Specifically, the court had to determine if the respondent had acted within the scope of its powers and whether its decision was based on proper considerations, or if it had exercised its discretion in an arbitrary or capricious manner.

Toohey J found that the respondent's refusal was unreasonable. His Honour applied the principle that a body exercising a power to approve or refuse a transfer must do so reasonably and not arbitrarily. The respondent had failed to provide any valid or substantial reason for its refusal, leading the court to conclude that the decision was not made in good faith or for a proper purpose. Consequently, the court ordered that the respondent's decision be set aside.