Santow JA at 1; Tobias JA at 180; Brownie AJA at 181
DECISION:
(1) The appeal is allowed in part. ; (2) The cross-appeal is dismissed. ; (3) Set aside Orders 2 and 3 made by Palmer J on 3 August 2004, and in lieu thereof order that the Defendant pay to the Plaintiff damages for breach of the Contract for Sale of Land dated 19 September 2002, to be ascertained by the Master upon enquiry. ; (4) Vary Order 6 made by Palmer J on 3 August 2004 by deleting therefrom the reference to Order 2. ; (5) Set aside Order 7 made by Palmer J on 3 August 2004, and in lieu thereof order that judgment be entered for the Cross-Claimant in the sum of $92,739 together with interest pursuant to the Supreme Court Act. ; (6) Set aside Order 7A made by Palmer J on 3 August 2004. ; (7) Each party is to pay its or her own costs both on the appeal and in the court below.
CATCHWORDS:
CONTRACT - misrepresentation by vendor in sales brochure as to size of property - standard contract for sale of land - contract affirmed by purchaser after discovering misrepresentation - subsequent failure to complete by purchaser not caused by misrepresentation - whether vendor entitled to rely on Notice to Complete and terminate contract - entitlement to damages for breach of contract - TRADE PRACTICES - s42 Fair Trading Act 1987 (NSW) - whether misrepresentation misleading and deceptive conduct - effect of word "approximately" in representation - effect of disclaimer on representation - whether conduct in "trade or commerce" - whether causation established - whether conduct of representee so unreasonable as to sever the chain of causation - damages for misleading and deceptive conduct - PROPERTY - EQUITY - s55(2A) Conveyancing Act 1919 (NSW) - deposit forfeited by vendor after failure by purchaser to complete contract - whether proper to exercise statutory discretion to order the deposit to be returned - factors relevant to exercise of discretion
[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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AGLC
Havyn Pty Ltd v Webster [2005] NSWCA 182
Case
[2005] NSWCA 182
Decision Date
CaseChat Overview and Summary
In *Havyn Pty Ltd v Webster*, the New South Wales Court of Appeal considered a dispute arising from a contract for the sale of land. The purchaser, Havyn Pty Ltd, alleged misrepresentation by the vendor, Mr. Webster, regarding the size of the property as depicted in a sales brochure. Despite discovering the alleged misrepresentation, the purchaser affirmed the contract but subsequently failed to complete the purchase. The vendor sought to rely on a Notice to Complete and terminate the contract, and also claimed damages for breach of contract and forfeiture of the deposit. The purchaser counterclaimed, alleging misleading and deceptive conduct under the *Fair Trading Act 1987* (NSW) and seeking the return of the deposit under section 55(2A) of the *Conveyancing Act 1919* (NSW).
The Court of Appeal was required to determine several key legal issues. Firstly, whether the vendor was entitled to terminate the contract and claim damages for breach, given the purchaser’s affirmation of the contract after discovering the alleged misrepresentation and the absence of causation between the misrepresentation and the failure to complete. Secondly, whether the vendor's conduct constituted misleading or deceptive conduct in trade or commerce under the *Fair Trading Act*, considering the use of the word "approximately" and the presence of a disclaimer in the brochure, and whether the purchaser's conduct severed the chain of causation for any such misleading conduct. Finally, the Court had to consider whether it was proper to exercise its statutory discretion to order the return of the deposit, and if so, on what terms.
The Court of Appeal found that while the vendor's representation regarding the property size, even with the word "approximately," could be considered misleading or deceptive conduct, the purchaser's subsequent affirmation of the contract and the lack of causation between the misrepresentation and the failure to complete meant the vendor was not entitled to terminate the contract on that basis. However, the Court held that the purchaser was in breach of the contract by failing to complete, and the vendor was entitled to damages for that breach. The Court also determined that the purchaser was entitled to judgment for the deposit paid, as the vendor's conduct in seeking to forfeit the deposit after the purchaser's failure to complete, in circumstances where the misrepresentation was not the cause of that failure, weighed against the vendor in the exercise of the statutory discretion.
The appeal was allowed in part, and the cross-appeal was dismissed. The orders of the primary judge were set aside and varied. The Court ordered that the purchaser pay damages to the vendor for breach of the contract, to be ascertained by the Master. The Court also ordered that judgment be entered for the purchaser in the sum of $92,739, representing the deposit, together with interest. Each party was ordered to bear their own costs of the appeal and in the court below.
Orders
Orders of the court
(1) The appeal is allowed in part. ; (2) The cross-appeal is dismissed. ; (3) Set aside Orders 2 and 3 made by Palmer J on 3 August 2004, and in lieu thereof order that the Defendant pay to the Plaintiff damages for breach of the Contract for Sale of Land dated 19 September 2002, to be ascertained by the Master upon enquiry. ; (4) Vary Order 6 made by Palmer J on 3 August 2004 by deleting therefrom the reference to Order 2. ; (5) Set aside Order 7 made by Palmer J on 3 August 2004, and in lieu thereof order that judgment be entered for the Cross-Claimant in the sum of $92,739 together with interest pursuant to the Supreme Court Act. ; (6) Set aside Order 7A made by Palmer J on 3 August 2004. ; (7) Each party is to pay its or her own costs both on the appeal and in the court below.