Gullaci & Gullaci v Borromeo - [2007] SASC 70

SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
GULLACI & GULLACI v BORROMEO
[2007] SASC 70
Judgment of The Honourable Justice Duggan
5 March 2007
CONTRACTS - GENERAL CONTRACTUAL PRINCIPLES - DISCHARGE, BREACH AND DEFENCES TO ACTION FOR BREACH - REPUDIATION AND NON-PERFORMANCE - REPUDIATION - GENERAL PRINCIPLES
DAMAGES - MEASURE AND REMOTENESS OF DAMAGES IN ACTIONS FOR BREACH OF CONTRACT - REMOTENESS - LOSS OF PROFITS
Agreement for joint venture to develop land - repudiation of contract by defendant - damages sought for expenses incurred and loss of opportunity to share in profit - no appearance by defendant - judgment entered for plaintiffs for damages to be assessed pursuant to Supreme Court Rules 1987 r 23.01 and r 75.04 - damages awarded.
Supreme Court Rules 1987 r 23.01, r 75.14, referred to.

GULLACI & GULLACI v BORROMEO
[2007] SASC 70
Civil

DUGGAN J. The defendant is the registered proprietor of a parcel of land situated at Two Wells. A house is erected on a section of the land which comprises approximately 5,000 square metres. The remainder of the parcel (“the vacant land”) comprises approximately 6.31 hectares.
The plaintiffs seek damages for breach of a contract entered into between Mr Gullaci on behalf of the plaintiffs and the defendant. According to the statement of claim, the defendant agreed to sell a half interest in the vacant land to the plaintiffs for the sum of $50,000. It was further agreed that the plaintiffs and the defendant would subdivide the land into housing allotments and then sell the individual allotments, the profit to be divided equally between the plaintiffs on the one hand and the defendant on the other.
According to the statement of claim, the plaintiffs incurred expense in preliminary work on the proposed development. However, the defendant then purported to repudiate the agreement. The plaintiffs’ claim for damages is based on the plaintiffs’ expenditure on the project and their loss of the opportunity to share in the profits which would have resulted from the development.
The defendant filed a defence on 12 January 2006 and the plaintiffs filed a reply on 3 March 2006. The matter was then set down for trial to commence on Monday 5 February 2007.
Originally, the defendant was represented by solicitors. However, upon application by the solicitors, the court made an order on 29 January 2007 declaring that the solicitors had ceased to be the solicitors for the defendant.
It became apparent to the plaintiffs’ solicitors prior to the commencement date of the trial that the defendant was not going to attend the trial. The defendant was advised that the plaintiffs proposed to apply for judgment to be entered in their favour pursuant to SCR 75.14 of the Supreme Court Rules 1987. SCR 75.14(1) provides as follows:
If, when an action is called on for trial, the plaintiff appears and the defendant does not appear, then the plaintiff, in all cases in which he, she or it would have been entitled to final judgment for the whole…

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.

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Details

Case: [2007] SASC 70
Decision Date: 5 March 2007

CaseChat Overview and Summary

In the case of Gullaci & Gullaci v Borromeo, the plaintiffs sought damages for the defendant's alleged repudiation of a joint venture agreement to develop land. The defendant did not appear in the court, resulting in a default judgment being entered in favour of the plaintiffs. The matter was brought before the court to determine the amount of damages to be awarded to the plaintiffs.

The primary legal issues addressed by the court were whether the defendant had indeed repudiated the contract and, if so, what damages the plaintiffs were entitled to claim. The court considered whether the plaintiffs could recover expenses incurred and the lost opportunity to share in the profits from the joint venture due to the defendant's actions. Given the nature of the claim and the lack of a defence from the defendant, the court was required to make findings on the measure and remoteness of damages, specifically focusing on the loss of profits.

The court found that the defendant had repudiated the joint venture agreement, which justified the plaintiffs' claim for damages. As the defendant did not appear and present any defence, the court proceeded to assess the damages based on the evidence provided by the plaintiffs. The court determined that the plaintiffs were entitled to recover the expenses they had incurred as a direct result of the repudiation, as well as the lost profits they would have shared had the joint venture proceeded as planned. The court awarded damages to the plaintiffs, with the specific amount to be assessed in accordance with the relevant rules of the Supreme Court.

The court's final orders included the entry of judgment in favour of the plaintiffs for the damages to be assessed. The assessment of the damages was to be conducted in line with the Supreme Court Rules 1987 r 23.01 and r 75.04. This meant that the court would determine the exact amount of damages based on the evidence provided, ensuring that the plaintiffs received appropriate compensation for their losses.

Orders