McKenzie v Villata

In *McKenzie v Villata* [1995] NSWCA 285, the New South Wales Court of Appeal considered a dispute between a vendor and a purchaser concerning the sale of a property. The purchaser sought to terminate the contract of sale, alleging that the vendor had failed to provide vacant possession by the settlement date.

The central legal issue before the Court of Appeal was whether the vendor had breached the contract by failing to deliver vacant possession on the stipulated date, and if so, whether this breach entitled the purchaser to terminate the agreement. The court also had to consider the proper interpretation of the contractual term requiring vacant possession.

The Court of Appeal found that the vendor had indeed failed to provide vacant possession as required by the contract. The court reasoned that the presence of a tenant, even one with a right to remain, constituted a failure to deliver vacant possession. This failure was considered a fundamental breach of the contract, entitling the purchaser to terminate. The court applied the principle that a vendor's obligation to provide vacant possession is a material term of a contract for the sale of land.

Consequently, the Court of Appeal dismissed the vendor's appeal and affirmed the purchaser's right to terminate the contract.