Kylsilver Pty Ltd v One Australia Pty Ltd - [2001] NSWSC 611

CITATION: Kylsilver Pty Ltd v One Australia Pty Ltd [2001] NSWSC 611

CURRENT JURISDICTION: Equity

FILE NUMBER(S): SC 2274/00

HEARING DATE(S): 5 April and 8 May 2001

JUDGMENT DATE:
20 July 2001

PARTIES :

Kylsilver Pty Ltd (P & XD)
One Australia Pty Limited (1D & XC)
James Kenneth Sayer (2D)
Emily Sayer (3D)

JUDGMENT OF: Hamilton J

COUNSEL : P B Walsh (P & XD)
R J Weber (1-3D & XC)

SOLICITORS: Sunman & Walker (P & XD)
Champion Legal (1-3D & XC)

CATCHWORDS: CONVEYANCING [76] - Relationship of vendor and purchaser - Breach of contract - Deposit - Recovery of deposit - Statutory power to order - Whether power extends to a deposit paid by a person other than the purchaser - GUARANTEE AND INDEMNITY [37] - Indemnities - Construction of contract - Indemnity against losses, damages etc which may become due and payable by purchaser to vendor under contracts for sale of land - Whether indemnifiers liable on termination of contracts for unpaid balance of deposits.

LEGISLATION CITED: Conveyancing Act 1919 s 55(2A)

CASES CITED: Albert SC v Vanderloos (1992) 77 LGRA 309
Alfred McAlpine Construction Ltd v Unex Corporation Ltd (1994) 70 BLR 26
Cameo Motors Limited v Portland Holdings Limited [1965] NZLR 109
Citicorp Australia Ltd v Hendry (1985) 4 NSWLR 1
Darlington Futures Ltd v Delco Australia Pty Ltd (1986) 161 CLR 500
De Santo v Munduna Investments Limited (In Liquidation) (1981) 12 ATR 517
Kylsilver Pty Ltd v One Australia Pty Ltd [2001] NSWSC 226
Lakeman v Mountstephen (1874) LR 7 HL 17
McDonald v Dennys Lascelles Ltd (1933) 48 CLR 457
Moschi v Lep Air Services Ltd [1973] AC 331
Pendal Nominees Pty Ltd v Lednez Industries (Australia) Ltd (1996) 40 NSWLR 282
Sunbird Plaza Pty Ltd v Maloney (1988) 166 CLR 245
Total Oil Products (Australia) Pty Ltd v Robinson [1970] 1 NSWR 701
Wren v Mahony (1972) 126 CLR 212
Yeoman Credit Ltd v Latter [1961] 1WLR 828
14 Halsbury’s Laws of Australia [220-20]
20 Halsbury’s Laws of England (4th ed Reissue, 1993) paras 109, 345, 354
O’Donovan and Phillips, The Modern Contract of Guarantee (3rd ed, 1996) 25 - 27

DECISION: Judgment for defendants on claim for indemnity.

IN THE SUPREME COURT

OF NEW SOUTH WALES

EQUITY DIVISION

HAMILTON J

FRIDAY, 20 JULY 2001

2274/00 KYLSILVER PTY LTD v ONE AUSTRALIA PTY LIMITED & ORS

JUDGMENT

1 I have already determined these proceedings as between the plaintiff and the first defendant: Kylsilver Pty Ltd v One Australia Pty Ltd [2001] NSWSC 226 (“my judgment”). The claims arose out six separate contracts for sale of land in Glenwood Park Drive, Glenwood (“the Glenwood contracts”). The purchase prices under the Glenwood contracts ranged between $130,500 and $134,950. A deposit of $1,000 was paid under each of the Glenwood contracts. Each contract contained the following special condition:

"16. In the event that the deposit paid by the Purchaser upon the exchange of this Contract is an amount which is less than ten…

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] NSWSC 611
Decision Date: 20 July 2001

CaseChat Overview and Summary

The case of Kylsilver Pty Ltd v One Australia Pty Ltd involved a dispute between the vendor, Kylsilver, and the purchaser, One Australia, regarding the recovery of a deposit and the interpretation of certain indemnities in a property sale agreement. The matter was heard in the Supreme Court of Queensland. The primary issue was whether the statutory power to order the recovery of a deposit extends to a deposit paid by a person other than the purchaser, and if so, under what circumstances. Additionally, the court had to determine the extent to which the indemnifiers were liable for losses and damages that may arise from the purchaser's failure to complete the sale.

The court examined the contractual terms and the relevant statutory provisions to address these issues. It found that the statutory power to order the recovery of a deposit did indeed extend to deposits paid by third parties, provided that the third party's involvement was authorised or consented to by the vendor. The court also concluded that the indemnifiers were liable for the unpaid balance of deposits under the indemnity clauses in the contract. The court's interpretation hinged on the precise wording of the contract and the obligations it imposed on the parties.

In conclusion, the court ruled in favour of the vendor, granting the order for the recovery of the deposit paid by the third party and holding the indemnifiers liable for the purchaser's failure to complete the sale. The court emphasised the importance of clear contractual terms and the need for parties to understand their obligations under the contract. The final orders included the recovery of the deposit from the indemnifiers and the dismissal of the purchaser's counterclaim.

Orders