Kelly v Ollis

In Kelly v Ollis, the Federal Court considered an application for rectification of a contract for sale of land. The vendor's solicitor had failed to insert the agreed date for completion in the contract. The parties had intended to adjust the contract in light of the purchaser's election to undertake subdivision work, but this adjustment was not made. Neither party, nor their lawyers, read the contract before signing it. The purchaser sought rectification of the contract, claiming it did not reflect the parties' agreement due to the missing completion date.

The court had to determine whether there was an operative mistake in the contract that would justify rectification. It considered whether the purchaser had made a mistake and whether the vendor's negligence could be a defence. The court held that there was insufficient evidence that the purchaser made any mistake, as neither party read the contract before signing it. The vendor's mistake was in signing off on the contract without adjusting it. The court noted that this was not a case of a mistranscribed agreement. The court further held that the vendor's negligence could be a defence, but only if the purchaser could show that the vendor's negligence caused the mistake.

Ultimately, the court found that the purchaser had not demonstrated that the vendor's negligence caused the mistake. The application for rectification was dismissed. The court emphasised that rectification is an extraordinary remedy and is only available in limited circumstances. The court noted that the remedy is not available where the party seeking rectification has contributed to the mistake by not reading the contract before signing it. The court also held that the vendor's negligence could be a defence, but only if the purchaser could show that the vendor's negligence caused the mistake. In this case, the purchaser had not made out this defence.