Court of Appeal
Supreme Court
New South Wales
- Amendment notes
Medium Neutral Citation: Hobhouse v Macarthur-Onslow [2022] NSWCA 158 Hearing dates: 28 April 2022 Date of orders: 23 August 2022 Decision date: 23 August 2022 Before: Ward P at [1];
Macfarlan JA at [2];
White JA at [43].Decision: (1) Allow the appeal.
(2) Dismiss the cross-appeal.
(3) Set aside the orders made in the Equity Division on 11 June 2021 and in lieu thereof declare that the purported exercise by Mr Macarthur-Onslow on or about 22 April 2021 of the option referred to in cll 5.6 and 12.2 of the Deed of Settlement and Release of 22 February 2021 was ineffective.
(4) Order the respondents to pay the appellant’s costs of the proceedings in this Court and in the Court below.
Catchwords: CONTRACTS — implied term — where the primary judge implied a term into a deed containing an option to purchase land so as to validate the purported exercise of that option — whether the conditions stated in BP Refinery were satisfied — held on appeal that the term was not necessary to give business efficacy to the contract, not “so obvious that it goes without saying” and not consistent with the express terms — further held that it was sufficient that the option, without the implication, was capable of being exercised in many foreseeable circumstances as distinct from all conceivable circumstances
EQUITY — remedies — whether the respondent entitled to relief against forfeiture if option to purchase land was not validly exercised — held on appeal that the respondent did not establish any of the “special heads” of fraud, accident, mistake or surprise, or any other circumstances establishing unconscientious conduct on the part of the appellant — circumstances do not amount to an “accident” where they are reasonably within the contemplation of the parties
Cases Cited: Bell v Lever Brothers Ltd [1932] AC 161
Besier v Foster (1952) 94 CLR 526; [1952] HCA 14
BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266; 52 ALJR 20
Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337; [1982] HCA 24
Con-Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Australia) Ltd (1986) 160 CLR 226; [1986] HCA 14
Hamlyn & Co v Wood &Co [1891] 2 QB 488
Heimann v The Commonwealth (1938) 38 SR (NSW) 691
Hospital Products Ltd v United States Surgical Corporation (1984) 156 CLR 41; [1984] HCA 64
Ikin v The Danish Club "Dannebrog" Inc [2001] VSCA 123
Legione v Hateley (1983) 152 CLR 406; [1983] HCA 11
Liverpool City Council v Irwin [1977] AC 239
Reigate v Union Manufacturing Co (Ramsbottom) Ltd [1918] 1 KB 592
Romanos v Pentagold Investments Pty Ltd (2003) 217 CLR 367; [2003] HCA 58
Sanders v Snell (1998) 196 CLR 329; [1998] HCA 64
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- AGLC
- Hobhouse v Macarthur-Onslow [2022] NSWCA 158
- Case
- [2022] NSWCA 158
- Decision Date
CaseChat Overview and Summary
The Court of Appeal was required to determine two principal issues: first, whether a term should have been implied into the deed to validate the purported exercise of the option, and second, whether the respondent was entitled to equitable relief against forfeiture if the option was not validly exercised.
On the first issue, the Court held that the conditions for implying a term, as established in *BP Refinery (Westernport) Pty Ltd v Shire of Hastings*, were not satisfied. The implied term was not necessary to give business efficacy to the deed, nor was it so obvious that it went without saying, and it was inconsistent with the express terms. The Court found that the option was capable of being exercised in many foreseeable circumstances without the implied term. Regarding the second issue, the Court determined that the respondent had not established any of the recognised "special heads" for relief against forfeiture, such as fraud, accident, mistake, or surprise, nor any other circumstances demonstrating unconscientious conduct by the appellant. The Court considered the circumstances to be reasonably within the contemplation of the parties and therefore not amounting to "accident".
Consequently, the Court of Appeal allowed the appeal, dismissed the cross-appeal, set aside the primary judge's orders, and declared that the purported exercise of the option was ineffective. The respondents were ordered to pay the appellant's costs.
Orders
Orders of the court
(1) Allow the appeal.
(2) Dismiss the cross-appeal.
(3) Set aside the orders made in the Equity Division on 11 June 2021 and in lieu thereof declare that the purported exercise by Mr Macarthur-Onslow on or about 22 April 2021 of the option referred to in cll 5.6 and 12.2 of the Deed of Settlement and Release of 22 February 2021 was ineffective.
(4) Order the respondents to pay the appellant’s costs of the proceedings in this Court and in the Court below.
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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