IAMBIC PTY LTD -v- NORTHWIND HOLDINGS PTY LTD [2001] WASC 44

Jurisdiction:	SUPREME COURT OF WESTERN AUSTRALIA	Citation No:	[2001] WASC 44
Case No:	CIV:2633/2000	Heard:	14 FEBRUARY 2001
Coram:	MASTER BREDMEYER	Delivered:	21/02/01
No of pages:	6	Judgment Part:	1 of 1
Result:	Application allowed
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Parties:	IAMBIC PTY LTD NORTHWIND HOLDINGS PTY LTD (ACN 008 464 037)
Catchwords:	Equity Specific performance of a contract for the sale of shares Specific performance sought by vendor for the payment of a sum of money
Legislation:	Nil
Case References:	Pasedina (Holdings) Pty Ltd v Khouri (1977) 1 BPR 9460 Turner v Bladin (1951) 81 CLR 463 Beswick v Beswick [1967] 2 All ER 1197 Ready Construction Pty Ltd v Jenno & Anor (1984) Q ConvR 54-142

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

IN CHAMBERS

CITATION : IAMBIC PTY LTD -v- NORTHWIND HOLDINGS PTY LTD [2001] WASC 44 CORAM : MASTER BREDMEYER HEARD : 14 FEBRUARY 2001 DELIVERED : 21 FEBRUARY 2001 FILE NO/S : CIV 2633 of 2000 BETWEEN : IAMBIC PTY LTD

Plaintiff

AND

NORTHWIND HOLDINGS PTY LTD (ACN 008 464 037)

Defendant

Catchwords:

Equity - Specific performance of a contract for the sale of shares - Specific performance sought by vendor for the payment of a sum of money

Legislation:

Nil

Result:

Application allowed

(Page 2)

Representation:

Counsel:

Plaintiff : Mr C F McLeod

Defendant : Mr J D Steedman

Solicitors:

Plaintiff : Deacons Lawyers

Defendant : Karp Steedman Ross-Adjie

Case(s) referred to in judgment(s):

Pasedina (Holdings) Pty Ltd v Khouri (1977) 1 BPR 9460
Turner v Bladin (1951) 81 CLR 463

Case(s) also cited:

Beswick v Beswick [1967] 2 All ER 1197
Ready Construction Pty Ltd v Jenno & Anor (1984) Q ConvR 54-142

(Page 3)

1 MASTER BREDMEYER: This is an application by the plaintiff for summary judgment seeking specific performance of an agreement. The agreement is for the sale and purchase of shares. The plaintiff is the vendor and the defendant, the purchaser.

2 The agreement for the sale of shares was in two parts. The first part was for the sale of 500,000 shares in Noizenet Pty Ltd ("Noizenet") for $250,000, payable on 1 March 2000. That money was paid and those shares were transferred. I am only concerned with the second part of that agreement which, as varied, was that the plaintiff sell to the defendant 1,000,000 shares in Noizenet for $500,000, payable by an instalment of $100,000 by 1 September 2000 and $400,000 by 16 October 2000. The defendant paid the instalment of $100,000. The plaintiff seeks an order that the defendant specifically perform and carry into execution its obligations under the deed and the variation by the payment to the plaintiff of the sum of $400,000 within seven days.

3 Specific performance is an equitable remedy whereby a party to a contract is directed to perform his obligations thereunder according to its terms. It presupposes an executory contract, as distinct from an executed one, where something remains to be…

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: [2001] WASC 44
Decision Date

CaseChat Overview and Summary

The Supreme Court of Western Australia considered an application for summary judgment in the case of Iambic Pty Ltd v Northwind Holdings Pty Ltd. The plaintiff, Iambic Pty Ltd, sought specific performance of a contract for the sale of shares, claiming that the defendant, Northwind Holdings Pty Ltd, had failed to pay the remaining $400,000 of the agreed purchase price of $500,000 for 1,000,000 shares in Noizenet Pty Ltd. The defendant argued against specific performance on the grounds of hardship and futility, claiming that it lacked the financial capacity to pay the remaining amount and that it would be futile to order specific performance as the defendant did not have the funds.

The court examined the principles of specific performance and the circumstances under which it might be granted. It noted that specific performance is an equitable remedy that directs a party to fulfill their contractual obligations. Although less common in cases where the obligation is to pay a sum of money, specific performance may still be appropriate when damages are not an adequate remedy, as established in Turner v Bladin. The court also considered whether the defendant's arguments of hardship and futility were sufficient grounds to oppose specific performance. It found that mere financial difficulty alone does not constitute hardship and that the defendant's desire to exchange its shares for shares in a new company before fulfilling the contract did not amount to hardship as defined in the cases.

The court concluded that the plaintiff was entitled to specific performance of the contract, subject to the defendant's liberty to apply for relief from the order if specific performance proved futile. The court granted the plaintiff's application for summary judgment, ordering the defendant to pay the remaining $400,000 within seven days. The order included liberty to apply, allowing the defendant to seek relief from the court if specific performance was found to be futile. The court reserved its decision on costs pending further submissions from the parties.

Orders