Lundie & Anor v Rowena Nominees Pty Ltd

The High Court of Australia considered an appeal by the applicants, Lundie and another, against a decision of the Supreme Court of Victoria concerning a dispute over a contract for the sale of land. The respondents, Rowena Nominees Pty Ltd, were the purchasers under the contract. The core of the dispute revolved around whether the purchasers had validly exercised their contractual right to terminate the agreement.

The primary legal issue before the High Court was whether the purchasers had given sufficient notice to the vendors to satisfy the requirements of a special condition in the contract. This condition stipulated that the purchasers could terminate the contract if they were unable to obtain finance on terms satisfactory to them, provided they gave notice of termination within a specified timeframe. The court had to determine the precise meaning of "terms satisfactory to them" and whether the notice provided by the purchasers met the contractual obligations.

The High Court held that the purchasers had not validly terminated the contract. Their Honours reasoned that the purchasers' obligation was to act honestly and reasonably in seeking finance and in assessing whether the terms offered were satisfactory. The evidence indicated that the purchasers had not made genuine efforts to obtain finance on the terms offered by the lender, and their purported dissatisfaction was not based on a reasonable assessment of those terms. Consequently, the purchasers had not satisfied the preconditions for valid termination under the special condition. The High Court therefore allowed the appeal, setting aside the order of the Supreme Court of Victoria.