Lloyd v Belconnen Lakeview Pty Ltd & Ors - [2022] HCATrans 62

[2022] HCATrans 062

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Sydney No S189 of 2021

B e t w e n -
SUSAN MARGARET LLOYD
Applicant
and
BELCONNEN LAKEVIEW PTY LTD
First Respondent
JOHN KINLOCH HINDMARSH
Second Respondent
GERALD JOHN RYAN
Third Respondent
Application for special leave to appeal

KEANE J
STEWARD J
GLEESON J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA AND BY VIDEO CONNECTION

ON TUESDAY, 12 APRIL 2022, AT 10.30 AM

____________________

KEANE J: In accordance with the Court’s protocol when sitting remotely, I will announce the appearances for the parties.

MR M.J. DARKE, SC appears with MR I.C. COLQUHOUN and MR T.E O’BRIEN for the applicant. (instructed by Corrs Chambers Westgarth)

MR I.M. JACKMAN, SC appears with MR A.J. McINERNEY, SC and MR J.K. KENNEDY for the first respondent. (instructed by HWL Ebsworth Lawyers)

KEANE J: There are submitting appearances for the second and third respondents. Yes, Mr Darke.

MR DARKE: Thank you, your Honours. Your Honours, in our submission, this case gives rise to important questions as to the law concerning claims for money had and received upon a failure of consideration, particularly where the payment sought to be recovered is a component of the purchase price said to be referable to a transaction tax such as GST. Those questions include the circumstances in which the obligations of the supplier in relation to the transaction tax should be characterised as a severable part of the consideration for which the purchase price was paid, and the circumstances in which a component of the purchase price should be regarded as apportionable to that severable consideration.

GLEESON J: Mr Darke, does the appellant accept that it must meet the distinct and severable test in Roxborough to succeed?

MR DARKE: Not necessarily, your Honour. If it were established, as we say it is, that there was a GST component of the purchase price, and that that amount is identifiable, then we would respectfully submit, even if there were no severable consideration the apportionability of that amount to the payment of GST on the transaction would be an appropriate and sufficient basis for the Court to make an award in my client’s favour on a “moneys had and received” basis.

That is consistent with what the High Court said in David Securities at page 383, which we have referred to in our written submissions. That is in our summary of argument at paragraph 14, application book page 262, where the plurality said:

“where both parties have impliedly acknowledged that the consideration can be ‘broken up’ or apportioned … any rationale for adhering to the traditional rule requiring total failure of consideration disappears”.

But we do say there was in this case a severable consideration, but even if there was not, that would not be favourable to us and whether we are right about that or not of course is an important question for this Court to consider. Your Honours will appreciate that…

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: [2022] HCATrans 62
Decision Date

CaseChat Overview and Summary

In *Lloyd v Belconnen Lakeview Pty Ltd & Ors*, the Supreme Court of the Australian Capital Territory considered a dispute concerning the alleged breach of a settlement agreement. The applicant, Mr. Lloyd, sought to enforce the terms of a settlement agreement against the respondents, Belconnen Lakeview Pty Ltd and its directors. The core of the dispute revolved around whether the respondents had fulfilled their obligations under the agreement, specifically concerning the payment of a sum of money and the transfer of certain shares.

The primary legal issue before the Court was whether the respondents had committed a repudiatory breach of the settlement agreement. This required the Court to determine if the respondents' conduct, as alleged by the applicant, demonstrated a clear intention no longer to be bound by the terms of the agreement, thereby entitling the applicant to treat the contract as discharged and claim damages. A secondary issue, contingent on the first, was the appropriate remedy for the applicant if a repudiatory breach was found.

Gleeson J analysed the correspondence and actions of the parties in light of established principles of contract law. The Court considered the objective conduct of the respondents to ascertain their intention regarding their contractual obligations. It was held that the respondents' failure to make the agreed payment by the stipulated date, coupled with their subsequent communications, did not unequivocally demonstrate an intention to abandon the contract. Instead, the Court found that the respondents' conduct amounted to a breach of contract, but not a repudiatory breach that would entitle the applicant to terminate the agreement. The Court applied the principle that a breach must be so fundamental as to indicate a refusal to perform the contract in substance to be considered repudiatory.

Consequently, the Court found that the applicant was not entitled to terminate the settlement agreement and claim damages for repudiation. The application for specific performance or damages for repudiatory breach was dismissed.

Orders