Gubbay v Burnet - [2012] NSWCA 174

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation: Gubbay v Burnet [2012] NSWCA 174
Hearing dates: 30 May 2012
Decision date: 30 May 2012
Before: Bathurst CJ at [1]; Basten JA at [20]; Tobias AJA at [21].
Decision:
Appeal dismissed with costs.
[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Catchwords: CONTRACT - termination - rescission - whether contract affirmed or terminated
CONTRACT - termination - breach - defences - compromise - whether release of cause of action by accord and satisfaction
EQUITY - estoppel - promissory estoppel - whether respondent estopped from terminating contract for appellant's breach
Legislation Cited: Conveyancing Act 1900, s 55(2A)
Property, Stock and Business Agents Act 2002, s 86
Category: Principal judgment
Parties: Lily Maria GUBBAY (Appellant)
David Anthony BURNET (First Respondent)
Pamela Jane CLANCY (Second Respondent)
Representation: Counsel:
Mr M W Sneddon; Mr A Ahmad (Appellant)
Mr J A Darvall (Respondent)
Solicitors:
Spooner & Hall (Appellant)
Kevin O'Kane & Co (Respondents)

File Number(s): 2010/225317
Decision under appeal

Citation:

[2011] NSWSC 977

Date of Decision:

2011-08-29 00:00:00

Before:

Bergin CJ in Eq

File Number(s):

2010/225317

Judgment

BATHURST CJ: This appeal was heard on 30 May 2012. At the conclusion of argument the Court ordered that the appeal be dismissed with costs and that our reasons would be provided in due course. My reasons for joining in the orders of the Court now follow.

The appellant, Ms Gubbay, purchased a property in Collaroy Plateau, New South Wales, from the respondents, Mr Burnet and Ms Clancy, at auction on 12 December 2009 for $2,300,000. She signed a contract for the sale of land and provided a deposit cheque in the amount of $230,000 to the agent of the respondents. Four days later the appellant's solicitor advised the respondents' solicitor that the cheque would be dishonoured as the appellant did not have the means to pay it. The appellant's solicitor raised the possibility of a $50,000 replacement deposit being accepted by the respondents in lieu of the $230,000 deposit. The respondents' solicitor sought instructions, and discussions were had in the ensuing days as to alternative arrangements that might be agreed upon. No alternative arrangements were agreed.

On 23 December 2009 the respondents' solicitor wrote to the appellant's solicitor in the following terms: "We have been instructed that, unless a satisfactory resolution occurs by 5.00 p.m. today, our clients will forthwith terminate the Contract and enforce their rights against your client." On the same day, the appellant's solicitor wrote to the respondents' solicitors advising that "given the time of year" a bank cheque for $50,000 was to be forwarded to the real estate agent of the…

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 Gubbay v Burnet

Details

AGLC: Gubbay v Burnet [2012] NSWCA 174
Case: [2012] NSWCA 174
Decision Date: 30 May 2012

CaseChat Overview and Summary

The appeal concerned a dispute between Gubbay (appellant) and Burnet (respondent) regarding the termination of a contract. The primary legal issues before the Court of Appeal of New South Wales were whether the respondent was estopped from terminating the contract due to the appellant's breach, whether the contract had been affirmed, and whether a release of the cause of action had occurred by way of accord and satisfaction.

The court considered whether the respondent's conduct gave rise to a promissory estoppel, preventing them from exercising their contractual right to terminate. It also examined whether the appellant's actions constituted an affirmation of the contract after the breach, thereby precluding termination. Furthermore, the court assessed whether any agreement reached between the parties amounted to an accord and satisfaction, which would extinguish the original cause of action for breach.

The Court of Appeal ultimately dismissed the appeal. The reasoning involved a detailed analysis of the principles of estoppel, affirmation, and accord and satisfaction in the context of contractual disputes. The court found that the elements required for these defences were not established on the facts, and therefore the respondent was entitled to terminate the contract. The appeal was dismissed with costs.

Orders

Orders of the court

Appeal dismissed with costs.

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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Medium Neutral Citation:	Gubbay v Burnet [2012] NSWCA 174
Hearing dates:	30 May 2012
Decision date:	30 May 2012
Before:	Bathurst CJ at [1]; Basten JA at [20]; Tobias AJA at [21].
Decision:	Appeal dismissed with costs. [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
Catchwords:	CONTRACT - termination - rescission - whether contract affirmed or terminated CONTRACT - termination - breach - defences - compromise - whether release of cause of action by accord and satisfaction EQUITY - estoppel - promissory estoppel - whether respondent estopped from terminating contract for appellant's breach
Legislation Cited:	Conveyancing Act 1900, s 55(2A) Property, Stock and Business Agents Act 2002, s 86
Category:	Principal judgment
Parties:	Lily Maria GUBBAY (Appellant) David Anthony BURNET (First Respondent) Pamela Jane CLANCY (Second Respondent)
Representation:	Counsel: Mr M W Sneddon; Mr A Ahmad (Appellant) Mr J A Darvall (Respondent) Solicitors: Spooner & Hall (Appellant) Kevin O'Kane & Co (Respondents)
File Number(s):	2010/225317
Decision under appeal	Citation: [2011] NSWSC 977 Date of Decision: 2011-08-29 00:00:00 Before: Bergin CJ in Eq File Number(s): 2010/225317