Lee v Lee

The dispute between Lee and Lee, which was adjudicated by the Supreme Court of Victoria, centred on the termination of a contract for the sale of land. The vendor, Lee, terminated the contract, alleging that the purchaser, also Lee, breached a condition by lodging a caveat over the subject property. The purchaser contested the validity of the termination, arguing that the condition was not a true condition, that the vendor induced or invited the breach, and that the vendor’s failure to complete by the date specified in the notice to complete precluded the termination. The purchaser also claimed that the vendor’s right to terminate was lost by the effluxion of time.

The legal issues before the court were whether the condition relied upon by the vendor was indeed a condition, whether the vendor induced or invited the breach, whether the vendor’s failure to complete by the specified date precluded termination for the purchaser’s breach, whether readiness, willingness and ability to perform one’s contractual obligations was necessary to exercise an express right of termination, and whether the vendor’s right to terminate was lost by effluxion of time. The court had to determine the validity of the termination and whether the purchaser’s actions constituted a breach that justified termination.

The court found that the condition relied upon by the vendor was indeed a condition, not a mere warranty. It was determined that the vendor did not induce or invite the breach. The court also held that the vendor’s failure to complete by the specified date did not preclude the termination for the purchaser’s breach. Furthermore, the court clarified that readiness, willingness and ability to perform one’s contractual obligations is not necessary to exercise an express right of termination. Finally, the court found that the vendor’s right to terminate was not lost by effluxion of time.

In light of these findings, the court upheld the vendor’s right to terminate the contract. The orders of the court were that the contract for the sale of land between the parties was terminated, and the purchaser was ordered to pay the vendor’s costs of the proceedings.