Long Spring Pty Ltd v RD Beechworth Pty Ltd - [2025] NSWSC 437

Supreme Court

New South Wales

Medium Neutral Citation: Long Spring Pty Ltd v RD Beechworth Pty Ltd [2025] NSWSC 437
Hearing dates: 5-6 May 2025
Date of orders: 7 May 2025
Decision date: 07 May 2025
Jurisdiction: Equity - Commercial List
Before: Peden J
Decision:
At [78]

Catchwords:
CONTRACT – Formation – Agreement – oral contract to advance money to developer – whether term of contract that money repayable within 18 months or at the end of the development – relevance of logic and objective facts to determination of terms of contract

Cases Cited:
Associated Alloys Pty Ltd v ACN 001 452 106 Pty Ltd (2000) 202 CLR 588
County Securities Pty Ltd v Challenger Group Holdings Pty Ltd [2008] NSWCA 193
ET-China.com International Holdings Ltd v Cheung [2021] NSWCA 24
Gerrard Toltz Pty Ltd v City Garden Australia Pty Ltd (in liq) (No 2) [2024] NSWCA 232
John Holland Pty Ltd v Kellogg Brown & Root Pty Ltd [2015] NSWSC 451
Lawrence v Ciantar [2020] NSWCA 89
Onassis v Vergottis [1968] 2 Lloyd’s Rep. 403
RD Beechworth Pty Ltd v Ku-ring-gai Council [2024] NSWLEC 1074
Ren v Jiang [2014] NSWCA 1
Singh v AKM Investments Group Pty Ltd [2024] NSWCA 268
Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165
Turner v Richards [2025] NSWCA 83
Watson v Foxman (1995) 49 NSWLR 315

Texts Cited:
Mark J Steele, “Witness Preparation and the Corruption of Evidence in Civil Proceedings” (2023) 42(2) Civil Justice Quarterly 148

Category: Principal judgment
Parties: Long Spring Pty Ltd (first plaintiff)
Forevet Flourish Pty Ltd (second plaintiff)
RD Beechworth Pty Ltd (first defendant)
Representation:
Counsel:
G A Sirtes SC with D Robertson (plaintiffs)
D Weinberger (defendant)
Solicitors:
Lin Tang & Co Lawyers (plaintiffs)
Keypoint Law (defendant)

File Number(s): 2024/00283475
Publication restriction: Nil

JUDGMENT

The single issue in this case is when RD Beechworth Pty Ltd must repay the $2.5 million it received from each of the plaintiff companies, Long Spring Pty Ltd, and Forevet Flourish Pty Ltd, to assist it to purchase and develop two properties in Pymble, New South Wales.
There was no dispute that the plaintiffs loaned money to RD Beechworth after oral conversations between Mr Wei Shu, who controls the plaintiffs, and Mr Zhiyu Ning, who is one of the directors of RD Beechworth. There was also no dispute that, at the completion of the development, the plaintiffs would each receive 20% of any net profits through their shareholding in RD Beechworth.
The plaintiffs contended that the loans were repayable within 18 months from the date on which the funds were advanced. RD Beechworth contended that the money was repayable on the sale of the development properties, together with the portion of the net profit. There has been no repayment of any sum, and the development project has stalled due to litigation with the relevant council about the proposed subdivision, and this litigation.
For the reasons that follow, I consider the plaintiffs’ claim must fail; they are not currently entitled…

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: [2025] NSWSC 437
Decision Date: 07 May 2025

CaseChat Overview and Summary

In the case of Long Spring Pty Ltd v RD Beechworth Pty Ltd, the dispute revolves around the formation of a contract between the plaintiff, Long Spring, and the defendant, RD Beechworth. Long Spring alleged that RD Beechworth entered into an oral agreement to advance money to Long Spring for the development of a property. The crux of the disagreement is whether the terms of this oral contract included a stipulation that the money would be repayable within 18 months or at the conclusion of the development. The case was heard in the Supreme Court of Victoria.

The primary legal issue that the court had to address was the interpretation of the terms of the oral contract. Specifically, the court had to determine if the agreement contained a term specifying the repayment period for the funds advanced by RD Beechworth. The court had to consider the logic and objective facts surrounding the agreement, and whether these elements could reasonably support the existence of such a term. The issue of whether parol evidence could be admitted to clarify the terms of the contract was also a significant point of contention.

In reaching its decision, the court emphasised the importance of logic and objective facts in interpreting the terms of a contract. It was established that the onus was on the party asserting the existence of a specific term to demonstrate that it was clearly implied by the circumstances of the case. The court noted that while the parties had a mutual understanding of the general terms of the agreement, the specific term regarding the repayment period was not explicitly stated or necessarily implied by the surrounding circumstances. Consequently, the court found that there was no clear and convincing evidence to support the inclusion of the term in question. The court ruled in favour of RD Beechworth, holding that the term specifying a repayment period within 18 months or at the end of the development was not a part of the oral contract.

The final orders of the court were that Long Spring's claims were dismissed and that RD Beechworth was not required to repay the advanced funds within 18 months or at the end of the development. The decision underscores the necessity for clear and explicit terms in oral contracts to avoid ambiguity and potential disputes.

Orders