Kraguljac v A & B Property Developments Pty Ltd - [2009] SASC 184

SUPREME COURT OF SOUTH AUSTRALIA
(Civil)
KRAGULJAC v A & B PROPERTY DEVELOPMENTS PTY LTD
[2009] SASC 184
Judgment of The Honourable Justice Kourakis
30 June 2009
CONVEYANCING - RELATIONSHIP OF VENDOR AND PURCHASER - MATTERS ARISING BETWEEN CONTRACT AND CONVEYANCE - CONDITIONS PRECEDENT AND SUBSEQUENT
CONTRACTS - GENERAL CONTRACTUAL PRINCIPLES - DISCHARGE, BREACH AND DEFENCES TO ACTION FOR BREACH - REPUDIATION AND NON-PERFORMANCE
Plaintiff and defendant entered into a contract for the sale of land – it was a special condition of that contract that settlement would take place within 90 days of the defendant removing all of its rubbish, property and materials from the land or earlier as agreed to by both of the parties – the defendant served a Notice to Complete on the plaintiff on 5 March 2008, claiming that the plaintiff had agreed to unconditionally settle on the land on 28 February 2008 – the plaintiff did not settle and the defendant then served a Notice of Termination on the plaintiff – the plaintiff brought proceedings against the defendant claiming that the notices served by the defendant were invalid because the plaintiff did not agree to settle unconditionally on 28 February 2008, that the contract was still on foot and seeking special performance of the contract – the defendant cross-claimed against the plaintiff seeking an order that the contract has been validly terminated and an order cancelling the plaintiff’s caveat over the land – the trial was limited to the defendant’s cross-claim – whether the parties had agreed to unconditionally settle on 28 February 2008 – whether the Notices served by the defendant were valid.
Held: The plaintiff did not agree to settle unconditionally on 28 February 2008 – the Notice to Complete and Notice of Termination served by the defendant were therefore invalid – in the alternative, the Notice to Complete was invalid in that it was not served in accordance with the terms of the contract – the contract remains on foot.
Land and Business (Sale and Conveyancing) Act 1994 (SA) s 6; Law of Property Act 1936 (SA) s 26, referred to.
McBride v Sandland (1918) 25 CLR 69, applied.
Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523; Phillips v Ellinson Brothers Pty Ltd (1941) 65 CLR 221; Neeta (Epping) Pty Ltd v Phillips (1974) 131 CLR 286, considered.

KRAGULJAC v A & B PROPERTY DEVELOPMENTS PTY LTD
[2009] SASC 184
KOURAKIS J
Summary

The defendant, A & B Property Developments Pty Ltd, is the registered proprietor of industrial land at Victoria Road, Largs Bay. I will refer to it as the Largs Bay land. The directors of the defendant are Artur Dyna and William Slipper. On 16 January 2007 the defendant contracted to sell the Largs Bay land to the plaintiff, George Kraguljac, “and/or his nominee”. The contract did not specify a particular date for settlement. Instead, the parties contracted that settlement would take place within 90 days of the defendant…

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 Kraguljac v A & B Property Developments Pty Ltd

Details

AGLC: Kraguljac v A & B Property Developments Pty Ltd [2009] SASC 184
Case: [2009] SASC 184
Decision Date: 30 June 2009

CaseChat Overview and Summary

Kraguljac, the plaintiff, and A & B Property Developments Pty Ltd, the defendant, were parties to a contract for the sale of land. The contract included a special condition stipulating that settlement would occur within 90 days after the defendant removed all rubbish, property, and materials from the land, or earlier if mutually agreed. On 5 March 2008, the defendant served a Notice to Complete to the plaintiff, claiming that the plaintiff had agreed to settle unconditionally on 28 February 2008. The plaintiff did not settle, leading the defendant to serve a Notice of Termination. The plaintiff initiated proceedings against the defendant, asserting that the notices were invalid as there was no agreement to settle unconditionally on 28 February 2008 and that the contract was still active. The defendant cross-claimed, seeking an order to declare the contract validly terminated and an order to cancel the plaintiff’s caveat over the land.

The primary legal issues before the court were whether the parties had indeed agreed to settle unconditionally on 28 February 2008 and whether the notices served by the defendant were valid. The court examined the evidence from the meeting on 5 February 2008, where neither party claimed an agreement had been reached for an unconditional settlement. The defendant argued that the plaintiff’s failure to call off the settlement despite the site conditions on 5 February supported their claim that an unconditional settlement agreement had been made in November 2007. After thoroughly reviewing the evidence, the court determined that the plaintiff did not agree to an unconditional settlement on 28 February 2008 and that the plaintiff's statements on 5 February 2008 did not constitute a waiver of the conditional settlement agreed upon in December. Consequently, the court found the Notices to Complete and of Termination served by the defendant to be invalid.

The court concluded that the Notice to Complete was also invalid as it was not served in accordance with the terms of the contract. Given these findings, the contract remained active. The court dismissed the defendant's cross-claim for declarations of the contract's validity or termination. The court indicated that it would hear the parties' submissions on the form of orders and directions they sought for the hearing and determination of the plaintiff's claims.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

This application was precipitated by my remarks during the hearing arising out of the evidence of what appeared to be the equivocal position taken by Mr Kraguljac about settlement when he met the defendants on 5 February 2008. However, my survey of the evidence relating to the meeting of 5 February shows that neither Mr Dyna nor Mr Slipper claimed that agreement was reached on that day to settle on 28 February. The defendant’s case was really that Mr Kraguljac’s failure to expressly call off the settlement in the face of the state of the site on that day supports their contention that he had, in November 2007, agreed to settle unconditionally. After a careful consideration of Mr Kraguljac’s evidence, I have now found that he did not so agree and that he did not say anything on 5 February 2008 that amounted to a waiver of the conditional settlement that had been agreed in December. Accordingly, there is no utility in allowing the amendment because it would be bound to fail. For that reason I refuse the application.Conclusion For the above reasons, I find that the Notice of Termination was ineffective. I would dismiss the defendant’s cross-claim seeking declarations that the contract is void or that it has been validly terminated. I will hear the parties on the precise form of the orders and on the directions they seek on the hearing and determination of the plaintiff’s claims.

Ratio Decidendi

Legal Principle Established

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