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Hera Project Pty Ltd v Bisognin [No 3]

Hera Project Pty Ltd v Bisognin [No 3]

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Case Copied 22 May 2017 81 min read

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IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

PROPERTY LIST

S CI 2016 03457

HERA PROJECT PTY LTD (ACN 163 685 041)	Plaintiff
v
GINO ANDREW BISOGNIN	First Defendant
- and -
LEAH JOAN BISOGNIN	Second Defendant

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JUDGE:	RIORDAN J
WHERE HELD:	MELBOURNE
DATES OF HEARING:	27–30 MARCH 2017
DATE OF JUDGMENT:	22 MAY 2017
CASE MAY BE CITED AS:	HERA PROJECT PTY LTD v BISOGNIN [No 3]
MEDIUM NEUTRAL CITATION:	[2017] VSC 268	1^st Revision: 26 May 2017

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PROPERTY – Contract for sale of land – Condition subsequent for registration of plan of subdivision to be achieved by specified date – Loss of right to terminate – Transformation of condition subsequent from one requiring performance by a specified time to one requiring performance within a reasonable time.

CONTRACT – Specific performance – Breach – Contract for the sale of land subject to registration of plan of subdivision – Obligation to use best endeavours to secure registration of plan of subdivision – Content of obligation to use best endeavours – Prevention principle discussed – Whether principle extends to acts that do not constitute contractual breaches – Whether acts of prevention by vendors – Whether purchasers entitled to specific performance – Whether relief should be conditional.

TRADE AND COMMERCE – Australian Consumer Law – Conduct ‘in trade or commerce’ – Whether representations concerning a subdivision of a residential property ‘in trade or commerce’ – Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594 applied – O’Brien v Smolonogov (1983) 53 ALR 107 discussed – Application of the re-enactment presumption.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr N Pane QC with Mr J J Whelan	Russell Kennedy
For the Defendant	Mr J Ribbands with Mr W G Stark	T F Grundy Lawyer

Cases cited

Alstom Ltd v Yokogawa Australia Pty Ltd & Anor [No 7] [2012] SASC 49
Apollo Shower Screens Pty Ltd v Building & Construction Industry Long Service Payments Corporation (1995) 1 NSWLR 561
Balfour Beatty Building Ltd v Chestermount Properties Ltd (1993) 62 BLR 12
Bisognin v Hera Project Pty Ltd [2015] VSC 647
Bisognin v Hera Project Pty Ltd [2016] VSC 75
Built Environs Pty Ltd v Tali Engineering Pty Ltd [2013] SASC 84
Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594
CSS Investments Pty Ltd v LopironPty Ltd (1987) 16 FCR 15
Foran v Wight (1989) 168 CLR 385
Fortress Credit Corporation (Australia) II Pty Limited v Fletcher (2015) 254 CLR 489
Hawes v Cuzeno Pty Ltd (1999) 10 BPR 18,011
Hawkins v Pender Bros Pty Ltd [1990] 1 Qd R 135
Hera Project Pty Ltd v Bisognin [No 4] [2017] VSC 270
IBM United Kingdom Ltd v Rockware Glass Ltd [1980] FSR 335
Jones v Dunkel (1959) 101 CLR 298
Joseph Street Pty Ltd v Tan (2012) 38 VR 241
Masters v Belpate Pty Ltd (2001) 10 BPR 18,527
New Zealand Shipping Co v Societe des Ateliers et Chantiers…

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: [2017] VSC 268
Decision Date: 22 MAY 2017

CaseChat Overview and Summary

Hera Project Pty Ltd, the purchaser, brought an action against the Bisognins, the vendors, for specific performance of a contract for the sale of land. The sale was subject to the registration of a plan of subdivision. The purchasers alleged that the vendors failed to use their best endeavours to secure the registration of the subdivision plan and that the vendors' conduct interfered with the registration process, preventing the purchasers from obtaining specific performance. The case was heard in the Supreme Court of Victoria. The primary legal issues before the court were whether the vendors' failure to use their best endeavours constituted a breach of contract, whether the prevention principle applied to acts that did not constitute contractual breaches, and whether the purchasers were entitled to specific performance. The court also needed to determine whether specific performance should be granted on condition that the subdivision plan was registered within a reasonable time.

The court found that the vendors' obligation to use their best endeavours to secure the registration of the subdivision plan was not a contractual promise to achieve registration but rather a commitment to act in good faith to assist in the registration process. The court held that the prevention principle did not extend to acts that did not constitute contractual breaches. Therefore, the vendors' actions that interfered with the registration process did not amount to a breach of contract. However, the court found that the vendors had breached their obligation to use their best endeavours by actively preventing the registration of the subdivision plan. The court held that the purchasers were entitled to specific performance, but this should be conditional on the subdivision plan being registered within a reasonable time.

The court ordered specific performance of the contract, subject to the condition that the subdivision plan was registered within six months from the date of the judgment. The court also ordered the vendors to compensate the purchasers for the costs incurred in obtaining the judgment. The court held that the representations concerning the subdivision of the residential property were "in trade or commerce" and therefore caught by the Australian Consumer Law. The court found that the vendors had engaged in conduct that was misleading or deceptive in breach of the Australian Consumer Law. The court awarded damages to the purchasers for the loss suffered due to the vendors' misleading or deceptive conduct.

Orders