Masters v Cameron

The case of *Masters v Cameron* concerned a dispute between a vendor and a purchaser arising from a written agreement for the sale of land. The purchaser had paid a sum of money described as a "deposit" upon signing the document. The vendor subsequently sought to resile from the agreement, and the purchaser claimed the return of the deposit. The matter came before the Supreme Court and was subsequently appealed to the High Court of Australia.

The central legal issue before the High Court was whether the written document signed by the parties constituted a concluded contract for the sale of land, or if it was merely an agreement to agree, contingent upon the preparation and acceptance of a formal contract. This determination was crucial for deciding whether the purchaser was entitled to the return of the deposit paid.

The High Court held that the agreement was not a concluded contract. The phrase "subject to the preparation of a formal contract of sale & which shall be acceptable to my solicitors on the above terms and conditions" indicated that the parties intended to be bound only upon the execution of a formal contract that met the approval of the purchaser's solicitors. The court reasoned that until such a formal contract was prepared and accepted, there was no binding agreement. The sum paid as a "deposit" was therefore not a deposit in the legal sense of part payment under a concluded contract, but rather an amount paid on the understanding that a contract might or might not be concluded.

The High Court allowed the appeal, discharged the judgment of the Supreme Court, and ordered that the balance of moneys paid into court, after certain costs, be paid out to the appellants (the purchasers). The respondent (the vendor) was ordered to pay the appellants' costs of the proceedings in the Supreme Court and the amount of the plaintiff's costs paid to it.