Lampropoulos v Kolnik

Case [2010] WASC 193


JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

IN CIVIL

CITATION:   LAMPROPOULOS -v- KOLNIK [2010] WASC 193

CORAM:   SIMMONDS J

HEARD:   28-30 APRIL, 1, 4 & 5 MAY, 2-4, 7-10 SEPTEMBER 2009

DELIVERED          :   30 JULY 2010

FILE NO/S:   CIV 1578 of 2005

BETWEEN:   PAMELA DENISE LAMPROPOULOS

Plaintiff

AND

LYNNE KOLNIK As Executor of the Will of GERALD THOMAS FOLEY
First Defendant

REGISTRAR OF TITLES
Second Defendant

Catchwords:

Contracts - Formation - Whether parties intended to be immediately bound - Memorandum of understanding in relation to an option providing for option agreement to be drafted

Contracts - Capacity to contract - Soundness of mind - Dementia - Whether party to contract suffering from dementia - Whether party to contract lacked contractual capacity - Whether other party ought to have known of incapacity

Unconscionable dealing - Whether party to contract suffering from special disadvantage - Whether special disadvantage sufficiently evident to other party - Whether other party took unconscientious advantage of special disadvantage

Legislation:

Nil

Result:

Action to enforce contract dismissed
Judgment for first defendant on counterclaim

Category:    B

Representation:

Counsel:

Plaintiff:     Mr M J McCusker QC & Mr A Metaxas

First Defendant             :     Ms G A Archer SC & Mr S R Sirett

Second Defendant         :     No appearance

Solicitors:

Plaintiff:     Metaxas & Hager

First Defendant             :     Downings Legal

Second Defendant         :     No appearance

Case(s) referred to in judgment(s):

Blomley v Ryan [1956] HCA 81; (1956) 99 CLR 362

Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336

Commercial Bank of Australia Ltd v Amadio [1983] HCA 14; (1983) 151 CLR 447

Crago v McIntyre [1976] 1 NSWLR 729

Edna May Collins by her next friend Glenys Lesley Laraine Poletti v May [2000] WASC 29

Ford by his tutor Watkinson v Perpetual Trustees Victoria Ltd [2009] NSWCA 186; (2009) 257 ALR 658

Gibbons v Wright [1954] HCA 17; (1954) 91 CLR 423

Giles v Rooney (1996) 23 MVR 510

Grainger v Williams [2009] WASCA 60

Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305; (2001) 52 NSWLR 705

Masters v Cameron [1954] HCA 72; (1954) 91 CLR 353

McLaughlin v Daily Telegraph Newspapers Co Ltd (No 2) [1904] HCA 51; (1904) 1 CLR 243

Moffatt Property Development Group Pty Ltd v Hebron Park Pty Ltd [2009] QCA 60

Niesmann v Collingridge [1921] HCA 19; (1921) 29 CLR 177

Tranchita v Retravision (WA) Pty Ltd [2001] WASCA 265

Turner v Windever [2005] NSWCA 73

SIMMONDS J: 

Introduction

  1. This is the trial of an action for relief by way of specific performance, damages and consequential relief.  The first defendant has also made a counterclaim for declaratory and related relief.

  2. The plaintiff claims as purchaser under an agreement to purchase a property by the sea at Mandurah.  The agreement is said to be the result of the exercise of an option granted by an option agreement headed 'Memorandum of Understanding' (MOU).  This was entered into with the registered proprietor of the property and subsequently…

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Lampropoulos v Kolnik [2010] WASC 193
Case
[2010] WASC 193
Decision Date

CaseChat Overview and Summary

The case of Lampropoulos v Kolnik was heard in the Supreme Court of New South Wales. The dispute involved a claim by the plaintiff, Lampropoulos, against the defendant, Kolnik, for the sale of a property under the terms of an option agreement. The central issue was whether the option agreement was legally binding and if the defendant had the capacity to enter into the contract, given her advanced dementia.

The primary legal issues the court needed to address were whether the parties intended to be immediately bound by a memorandum of understanding, and if so, whether the defendant had the capacity to contract due to her dementia. The court also had to consider whether the plaintiff was aware of the defendant's incapacity and whether this led to unconscionable conduct. The court examined the circumstances surrounding the formation of the contract and the extent to which the defendant's special disadvantage was evident to the plaintiff.

The court found that the parties did not intend to be immediately bound by the memorandum of understanding, and therefore no enforceable contract was formed at that stage. Regarding the defendant's capacity, the court held that she was suffering from dementia, which significantly impaired her ability to understand the nature and effect of the agreement. The court also determined that the plaintiff was aware of the defendant's incapacity and took advantage of her special disadvantage, leading to unconscionable conduct. As a result, the court ruled in favour of the plaintiff, awarding damages for the breach of the option agreement.

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

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Ratio Decidendi

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