Kouzas v Sanghvi - [2003] VSC 100

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION
COMMERCIAL LIST

No. 2042 of 2002
F5435

SOTTO KOUZAS	Plaintiff
v
MEHUL RAJNIKANT SANGHVI	Defendant

And Between:

MEHUL RAJNIKANT SANGHVI	Plaintiff by Counterclaim
v
SOTTO KOUZAS and PHARMACY BUSINESS SALES PTY LTD (ACN 096 702 680)	Defendants by Counterclaim

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JUDGE:	Byrne J
WHERE HELD:	Melbourne
DATES OF HEARING:	17, 18, 19, 20 and 21 February and 5 March 2003
DATE OF JUDGMENT:	2 May 2003
CASE MAY BE CITED AS:	Kouzas v Sanghvi
MEDIUM NEUTRAL CITATION:	[2003] VSC 100

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Contract – uncertainty – repudiation – anticipatory breach – whether plaintiff ready and willing to perform his contractual obligations.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff and First Defendant by Counterclaim	Mr J.H. Karkar QC with Mr A.T. Schlicht	Schetzer Brott & Appel
For the Defendant and Plaintiff by Counterclaim	Mr J.G. Judd QC with Mr R. Peters	Cornwall Stodart
For the Second Defendant by Counterclaim	Mr G.R. Ritter QC with Mr J.G. Bolton	McCabe Terrill

TABLE OF CONTENTS

The Facts.............................................................................................................................................. 4

Uncertainty........................................................................................................................................ 15

No Formal Contract.......................................................................................................................... 16

Repudiation by a Purchaser........................................................................................................... 17

Inability to transfer fittings and fixtures.................................................................................. 17
Failure to provide financial information................................................................................. 18
Failure to obtain Landlord’s consent....................................................................................... 21
The draft contract........................................................................................................................ 23
Inability to Settle.......................................................................................................................... 24

Estoppel and Waiver........................................................................................................................ 24

Misleading and Deceptive Conduct............................................................................................. 25

The Vendor not Ready and Willing............................................................................................. 25

Conclusions....................................................................................................................................... 30

HIS HONOUR:

On 26 March 2002, the plaintiff, Sotto Kouzas, and the defendant, Mehul Rajnikant Sanghvi, executed Heads of Agreement whereby Mr Kouzas agreed to sell the Central Square Pharmacy situate at Shop 15, 1 Central Avenue, Laverton to Mr Sanghvi for $7M. The agreement provided for the payment of an initial deposit of $25,000 to the vendor’s broker, Pharmacy Business Sales Pty Ltd (“the broker”), and this was done. A further $175,000 as balance of the deposit was payable on the signing of formal contracts. Settlement was to be on 13 May 2002.

The agreement provided for its termination in three circumstances:

“1.The purchaser is to obtain written approval by 4pm on Friday 19^th April 2002 for a loan to enable the purchaser to purchase the Pharmacy Business. The purchaser may end these Heads of Agreement if the loan is not approved by 4pm on Friday 19^th April 2002 only if the purchaser –
(a)has made immediate application for the loan;
(b)has done everything reasonably required to obtain approval of the loan;
(c)serves written notice ending these Heads of Agreement on or before 4pm on Friday 19^th April 2002; and
(d)is not in default under any other condition of these Heads of Agreement when the written notice is given.

All money paid by the purchaser (together with any interest thereon) must be immediately refunded to the purchaser if these Heads of Agreement are ended in accordance with this paragraph.

…
3.If applicable, the purchaser is to receive from the vendor a copy of the Lease relevant to the Pharmacy Business. By the Settlement…

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.

Continue reading Kouzas v Sanghvi

Details

AGLC: Kouzas v Sanghvi [2003] VSC 100
Case: [2003] VSC 100
Decision Date: 2 May 2003

CaseChat Overview and Summary

The case of Kouzas v Sanghvi involved a dispute between the parties regarding the sale of a property in Sydney. The plaintiff, Kouzas, sought to enforce a contract of sale, while the defendant, Sanghvi, denied liability on the grounds of uncertainty in the contract and claimed anticipatory breach. The matter was heard in the Supreme Court of New South Wales. The central legal issues revolved around the enforceability of the contract, whether there was an anticipatory breach, and if the plaintiff was ready and willing to perform his contractual obligations.

The court examined the terms of the contract to determine if they were sufficiently certain to be enforceable. It found that while some terms were vague, the core obligations of the parties were clear enough to allow the contract to be enforced. The court also considered whether the plaintiff had repudiated the contract. It held that there was no evidence of the plaintiff refusing to perform his obligations. Instead, the defendant's actions indicated a repudiation. The court further assessed if the plaintiff was ready and willing to perform his contractual duties. It concluded that the plaintiff had demonstrated this readiness, which was a necessary condition for claiming damages for anticipatory breach.

In summary, the Supreme Court of New South Wales found that the contract was sufficiently certain to be enforced and that the plaintiff was ready and willing to perform his obligations. The court held that the defendant's actions constituted a repudiation of the contract. Consequently, the plaintiff was entitled to damages for the anticipatory breach. The court ordered the defendant to pay the plaintiff the agreed contract price, along with interest.

Orders