Komtas Pty Ltd v Buckingham
[2001] WASC 193
•26 JULY 2001
KOMTAS PTY LTD -v- BUCKINGHAM [2001] WASC 193
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2001] WASC 193 | |
| 26/07/2001 | |||
| Case No: | CIV:1864/2001 | 19 JULY 2001 | |
| Coram: | MASTER BREDMEYER | 20/07/01 | |
| 8 | Judgment Part: | 1 of 1 | |
| Result: | Application allowed | ||
| PDF Version |
| Parties: | KOMTAS PTY LTD GEORGE HUGH BUCKINGHAM |
Catchwords: | Contract for the sale of land Repudiation by letter Acceptance of repudiation Purchaser entitled to refund of deposit and other moneys |
Legislation: | Nil |
Case References: | Mersey Steel and Iron Co v Naylor Benzon & Co (1884) 9 App Cas 434 Australian Can Co Pty Ltd v Levin & Co [1947] VLR 332 Contract Discount Corp Ltd v Furlong [1948] 1 All ER 274 Cordinup Resorts Pty Ltd v Terana Holdings Pty Ltd (1997) 143 FLR 18 Crump v Cavendish [1880] ex D 211 Daimier Co Ltd v Continental Tyre & Rubber Co (Great Britain Ltd) [1916] 2 AC 307 Evans v Bartlam [1937] AC 473 Fancourt v Mercantile Credits Ltd (1983) 154 CLR 87 Fieldrank Ltd v Stein [1961] 3 All ER 681 Foran v Wight (1989) 168 CLR 385 General Credits (Finance) Pty Ltd v Shipton Holdings Pty Ltd, unreported; SCt of WA; Library No 2054; 19 May 1997 Gillon v Kyle, unreported; SCt of WA; Library No 9123; 16 October 1991 Harrison v Bottenheim (1878) 26 WR 362 Hills v Sklivas [1995] 1 VR 599 Jacka Nominees Pty Ltd (In Liq) v Edwards Karwacki Smith & Co Pty Ltd, unreported; SCt of WA; Library No 920512; 12 October 1992 Jacobs v Booth's Distillery Co (1901) 85 LT 262 Jones v Stone [1894] AC 122 Lewkowski v Bergalin Pty Ltd, unreported; FCt SCt of WA; Library No 7675; 26 May 1989 Lynde v Waitham [1895] 2 QB 180 Moscow Narodny Bank Ltd v Mosbert Finance (Aust) Pty Ltd [1976] WAR 109 Singh v Varinder Kaur (1985) 61 ALR 720 Smith v Town & Country Bank, unreported; SCt of WA; Library No 970716; 18 December 1997 Theseus Exploration NL v Foyster (1972) 126 CLR 507 Webster v Lampard (1993) 177 CLR 598 White v Johnson (1886) 8 ALT 53 Whitehall Holdings Pty Ltd v Custom Credit Corp Ltd, unreported; SCt of WA; Library No 9189; 13 December 1991 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Plaintiff
AND
GEORGE HUGH BUCKINGHAM
Defendant
Catchwords:
Contract for the sale of land - Repudiation by letter - Acceptance of repudiation - Purchaser entitled to refund of deposit and other moneys
Legislation:
Nil
Result:
Application allowed
(Page 2)
Representation:
Counsel:
Plaintiff : Mr I N Wilson
Defendant : Mr M D Evans
Solicitors:
Plaintiff : Ian Wilson
Defendant : Corsers
Case(s) referred to in judgment(s):
Mersey Steel and Iron Co v Naylor Benzon & Co (1884) 9 App Cas 434
Case(s) also cited:
Australian Can Co Pty Ltd v Levin & Co [1947] VLR 332
Contract Discount Corp Ltd v Furlong [1948] 1 All ER 274
Cordinup Resorts Pty Ltd v Terana Holdings Pty Ltd (1997) 143 FLR 18
Crump v Cavendish [1880] ex D 211
Daimier Co Ltd v Continental Tyre & Rubber Co (Great Britain Ltd) [1916] 2 AC 307
Evans v Bartlam [1937] AC 473
Fancourt v Mercantile Credits Ltd (1983) 154 CLR 87
Fieldrank Ltd v Stein [1961] 3 All ER 681
Foran v Wight (1989) 168 CLR 385
General Credits (Finance) Pty Ltd v Shipton Holdings Pty Ltd, unreported; SCt of WA; Library No 2054; 19 May 1997
Gillon v Kyle, unreported; SCt of WA; Library No 9123; 16 October 1991
Harrison v Bottenheim (1878) 26 WR 362
Hills v Sklivas [1995] 1 VR 599
Jacka Nominees Pty Ltd (In Liq) v Edwards Karwacki Smith & Co Pty Ltd, unreported; SCt of WA; Library No 920512; 12 October 1992
Jacobs v Booth's Distillery Co (1901) 85 LT 262
Jones v Stone [1894] AC 122
Lewkowski v Bergalin Pty Ltd, unreported; FCt SCt of WA; Library No 7675; 26 May 1989
(Page 3)
Lynde v Waitham [1895] 2 QB 180
Moscow Narodny Bank Ltd v Mosbert Finance (Aust) Pty Ltd [1976] WAR 109
Singh v Varinder Kaur (1985) 61 ALR 720
Smith v Town & Country Bank, unreported; SCt of WA; Library No 970716; 18 December 1997
Theseus Exploration NL v Foyster (1972) 126 CLR 507
Webster v Lampard (1993) 177 CLR 598
White v Johnson (1886) 8 ALT 53
Whitehall Holdings Pty Ltd v Custom Credit Corp Ltd, unreported; SCt of WA; Library No 9189; 13 December 1991
(Page 4)
1 MASTER BREDMEYER: This is an application by the plaintiff for summary judgment against the defendant. The plaintiff Komtas Pty Ltd, a company controlled by Mr Charles Joseph Morrone, signed a contract of sale with the defendant on 5 October 1999 to purchase the defendant's property at 1138 Hay Street, West Perth. The price was $770,000. The deposit of $20,000 was paid and the balance was due and payable on 5 October 2000. It was not subject to finance. There were two special conditions - only one of which is relevant to this application - namely:
"The Vendor agrees to allow demolition or refurbishment of the building and will sign any building applications required by the Purchaser."
- The contract was stamped. The contract incorporated the joint form of general conditions for the sale of land (1998 version) (the "joint conditions"). The contract provided that rates and taxes were to be adjusted on settlement and that possession was to be taken on settlement.
2 Shortly after entering into the contract the plaintiff lodged a caveat against the title to protect its interest.
3 Shortly after signing the contract Mr Morrone said that Mr Buckingham asked him to pay the rates and taxes from 5 October 1999 because Mr Buckingham was impecunious. Mr Morrone said he agreed to do this provided he would get an adjustment - meaning a credit - for those rates on settlement. On 13 October 1999 Mr Morrone paid the water rates and the shire rates from 5 October 1999 to 30 June 2000. A little later he paid the land tax for the same period. In early 2000 the plaintiff had the power disconnected and paid $2,023 for that and had the building demolished and paid $4,000 for that.
4 In June or July 2000 Mr Morrone presented a transfer to Mr Buckingham for him to sign. According to Mr Morrone, Mr Buckingham said he would not sign it until the purchase price had been paid in full.
5 Mr Buckingham has a different version of that incident. He says that Mr Morrone wanted the property to be transferred then and there. Mr Buckingham said he refused. He said, in effect, "You can't get a transfer until you pay the balance of purchase price and the outstanding outgoings".
6 In a summary judgment application, when the plaintiff and defendant give different versions of an event, the court should normally accept the
(Page 5)
- defendant's version as arguable unless it is inherently incredible, or contradicted by documents or other evidence. On that principle I should accept the defendant's version, which I do not regard as inherently incredible or contradicted by documents etc. But in this case it matters not which version I accept because, on any view, there was not a breach of the contract at that time. The plaintiff was not put off by the defendant's words. The plaintiff purchaser had the duty under the contract to submit a transfer signed by him and stamped, to the vendor, a reasonable time prior to settlement, and the plaintiff did that. Mr Morrone presented a stamped transfer to the defendant for execution on 3 October 2000. That was a bit late, but still in time for the settlement to have taken place on 5 October.
7 On 5 October 2000 I consider there were breaches of contract on both sides. On the plaintiff's side there was no evidence that he attended settlement or was ready to attend settlement with a cheque for $750,000. There was no evidence that the plaintiff was ready, willing and able to pay the rates and taxes which were then owing from 1 July 2000 to 5 October 2000. On the defendant's side, there is no evidence that he was ready with a signed transfer and the duplicate title to take part in the settlement.
8 Because of the plaintiff's breaches of contract, the defendant could have given a 14 day notice of default to correct the breaches. If he had done that, and the plaintiff had not responded, the defendant could have forfeited the deposit - see cl 19(1)(d) of the joint conditions and also sued for damages.
9 Because of the defendant's breach of contract on 5 October, the plaintiff could have given him 14 days notice under cl 18(1)(b) of the joint conditions, calling on the defendant to sign the transfer and attend on settlement.
10 No notices of default were given by either side.
11 I should add that the oral agreement for the purchaser to pay the rates and taxes from 5 October 1999 should, as a matter of construction, be subject to the joint conditions. It is as if it was added in as a special condition 3 on the contract of sale form.
12 As I have said, nothing happened on 5 October 2000, the day of settlement. The next step was a letter or note from the defendant delivered to the plaintiff about mid-October 2000. It is undated. I reproduce it:
(Page 6)
- "Mr Charles Moorone [sic]
The Contract to buy 1138 Hay St has now become null & void since 5th Oct 2000 therefore the following now applies
1 You are required by law to withdraw your claim on the above property.
2 You have also offended by advertising it.
3 Also you are to repay debt owing to me of $22:16 for leaving out the 29th February plus $1080 Marginal region tax which you already know.
4 You still owe Water Rates from 30th June and you will be required to pay Land Tax 30th June.
It is with most regret to tell you if you fail of paying any of the above you will lose your Licence as an Estate Agent.
[signed] E Buckingham"
13 The plaintiff says that that is a repudiation letter. The defendant says I should not conclude that in a summary judgment application; that the matter should go to trial so that oral evidence of the circumstances surrounding the writing and delivery of that letter could be given. The defendant's counsel has referred me to a passage from Lord Selborne in Mersey Steel and Iron Co v Naylor Benzon & Co (1884) 9 App Cas 434 at 438 - 439:
"You must look at the actual circumstances of the case in order to see whether the one party to the contract is relieved from its future performance by the conduct of the other; you must examine what that conduct is so as to see whether it amounts to a renunciation, to an absolute refusal to perform the contract ... and whether the other party may accept it as a reason for not performing his part."
- Having read that and looked at the defendant's version of the surrounding circumstances in par 11 of his affidavit, I am satisfied from the wording of the letter that it shows a clear and unequivocal repudiation - that the contract is at an end - that Mr Buckingham does not intend to go ahead with the sale. It shows that he does not intend to perform the contract. It is "null & void".
(Page 7)
14 I consider that the letter was written before he attended the meeting. Its wording was therefore carefully chosen. Its wording was not qualified by oral words spoken at the time of handing it over. Points 1, 2, 3 and 4 in the letter are not qualifications of the first sentence. Rather, they are consequences that Mr Buckingham is spelling out. Because the contract is null and void, you have to do the following, for example: (1) withdraw the caveat, and (3) and (4) pay the outstanding rates. It is probably implicit in this letter that Mr Buckingham will be keeping the deposit.
15 I consider the repudiation was accepted by Mr Wilson, solicitor for the plaintiff, in his letter of 11 January 2001. I particularly refer to the words: " ... there is no doubt that you have repudiated the contract ... our client demands repayment of $32,568.37", and then a breakdown of that sum is given.
16 The next letter from Corsers, solicitors for the defendant, of 19 January 2001, was an attempt to affirm the contract - "We have instructions to proceed to settlement of the sale by your client", but I think it too late. I consider the defendant had repudiated and the plaintiff had accepted that by the letter of 10 January.
17 It follows from my views that the conduct of sale is at an end. The repudiation letter and the acceptance (that is, an offer and acceptance) achieved that. Question: who repudiated the contract? Answer: the defendant. It follows that the plaintiff should get its deposit back and the other moneys it has paid. There will be summary judgment for the plaintiff.
18 I will give my thoughts on the other action - CIV 1498 of 2001 - which will be obiter. I will not make any orders on that action. In what follows, I will continue to refer to Mr Buckingham as the defendant and Komtas Pty Ltd as the plaintiff.
19 Because of the defendant's repudiation and the plaintiff's acceptance of that, the defendant vendor cannot now get specific performance. The defendant would like damages. That is the alternative relief sought in his claim. He would like to forfeit the deposit etc. I consider he cannot do that. He is stuck with cl 19(1)(d) of the joint conditions. He should have given a 14 day notice calling on the plaintiff to remedy the default (namely, to produce the $750,000 and to pay the outstanding rates). If that had been done, then by that clause he could have got damages.
(Page 8)
20 From the defendant's point of view, what a pity he did not read the fine print of the contract, or get legal advice, before writing his null and void letter.
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