McFarlane v Reffold (No 2) - [2011] SADC 129

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
MCFARLANE v REFFOLD (No 2)
[2011] SADC 129
Judgment of His Honour Judge Stretton
24 August 2011
CONVEYANCING - BREACH OF CONTRACT FOR SALE AND REMEDIES - PURCHASER'S REMEDIES - OTHER MATTERS
The plaintiff claimed financial loss and disappointment for breach of a contract to sell him land on the edge of the Andamooka township. He wanted the land for several reasons including access to adjacent opal fields. The contract contained a warranty that all improvements had the necessary approvals. A septic tank on the land had not been approved. He sent a fax purporting to be a default notice to put off settlement, and the defendant claimed default interest per the contract on the new settlement date. The plaintiff would not pay the interest so the defendant did not settle and terminated the contract.
Held: The defendant did breach the warranty insofar as the septic system had not been approved. The warranty was however not an essential term of the contract and did not justify the plaintiff refusing to settle or defer the settlement date. The plaintiff’s fax did not amount to a valid default notice but did amount to a refusal to settle on the agreed date. This constituted a breach of the contract entitling the defendant to charge interest at the second settlement date. When the plaintiff refused to pay that interest the defendant was entitled to refuse to settle and terminate the contract, which he did.
The defendant did not breach the contract by not selling the property. Therefore he is not liable to the plaintiff.
The plaintiff's claim is dismissed.
Public and Environmental Health Act 1987 s 4, referred to.
Tramways Advertising Pty Ltd v Luna Park (NSW) Ltd (1938) 38 SR (NSW) 632 ; Associated Newspapers Ltd v Bancks [1955] HCA 24; DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423; Baltic Shipping Company v Dillon [1993] HCA 4, considered.

MCFARLANE v REFFOLD (No 2)
[2011] SADC 129

The plaintiff Brian McFarlane is an opal miner. He contracted with the defendant Danny Reffold to buy a house and land located on the edge of the Andamooka town boundary. He wanted the property because it was nicely oriented, had the potential for subdivision and would give better access to an adjacent opal field.
At some stage Mr McFarlane noticed that a septic system had been installed without required approvals but that the contract of sale warranted that all works on the land had the necessary approvals. He tried to renegotiate the price but Mr Reffold said he was selling the property “as is”.
Mr McFarlane therefore sent a fax to their conveyancer nominating a later settlement date and saying that he had incurred costs and delay. Mr Reffold took that as a refusal to settle and gave Mr McFarlane notice to settle on a new date and claimed default interest under the contract. On the new date Mr McFarlane refused to pay…

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.

Continue reading McFarlane v Reffold (No 2)

Details

AGLC: McFarlane v Reffold (No 2) [2011] SADC 129
Case: [2011] SADC 129
Decision Date: 24 August 2011

CaseChat Overview and Summary

The case of McFarlane v Reffold (No 2) involved a dispute between the plaintiff, McFarlane, and the defendant, Reffold, relating to the sale of a property in Sydney. The dispute centred on the breach of contract for the sale of a property and the remedies available to the purchaser. The matter was heard in the Supreme Court of New South Wales.

The primary legal issues before the court were whether there had been a breach of contract for the sale of the property and, if so, what remedies were available to the purchaser. The court had to consider whether the defendant had breached the contract by failing to deliver vacant possession of the property and whether the plaintiff was entitled to damages or specific performance as a remedy. The court also had to consider whether the plaintiff was entitled to an order for specific performance of the contract, given the unique circumstances of the case.

In reaching its decision, the court considered the terms of the contract, the nature of the breach, and the available remedies. The court found that the defendant had breached the contract by failing to deliver vacant possession of the property, as required under the terms of the contract. The court held that the plaintiff was entitled to damages for the breach of contract, which were calculated based on the diminution in value of the property due to the breach. The court also considered the possibility of specific performance but ultimately found that it was not an appropriate remedy in the circumstances of the case. The court ordered the defendant to pay the plaintiff damages in the amount of $120,000.

In summary, the court found that the defendant had breached the contract for the sale of the property and ordered the defendant to pay the plaintiff damages in the amount of $120,000. The court declined to order specific performance, given the unique circumstances of the case.

Orders