Martin v Purnell, Martin v Individual Homes

The proceedings involved two consolidated appeals, *Martin v Purnell* and *Martin v Individual Homes*, heard by Hayne and Callinan JJ of the High Court of Australia. The dispute concerned the interpretation of a clause within a standard form contract for the sale of land, specifically relating to the vendor's obligation to provide vacant possession. The purchasers sought to terminate the contracts, alleging that the vendors had failed to provide vacant possession as required.

The central legal issue before the High Court was whether the vendor's obligation to give vacant possession under the standard form contract extended to ensuring that no tenant remained in possession of the property at settlement, even if the lease agreement was not in breach. The court was required to determine the precise meaning and scope of the term "vacant possession" in the context of a residential property sale where a tenant was lawfully occupying the premises under a lease that had not yet expired.

The High Court held that the term "vacant possession" in the standard form contract meant that the purchaser must be given possession of the land free from any right of occupation by any other person. This included the right of a tenant under a lease, even if that lease was not in breach. The court reasoned that the vendor's obligation was to deliver the property in a state where the purchaser could immediately occupy it, and the presence of a lawful tenant prevented this. Therefore, the purchasers were entitled to terminate the contracts.