Measey v Evans
[1996] QCA 108
•19 April 1996
IN THE COURT OF APPEAL
SUPREME COURT OF QUEENSLAND
Appeal No. 74 of 1994.
Brisbane
[Measey v. Evans & Ors.]
BETWEEN:
BRIAN HAROLD MEASEY and PATRICIA MARY MEASEY
Appellants
AND:
EARNEST VICTOR EVANS, EDWARD JOHN EVANS,
GRAHAM DOUGLAS EVANS and KAREN PATRICIA LANGTONRespondents
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Pincus J.A.
Ambrose J.
Helman J.
___________________________________________________________________
Judgment delivered 19/04/1996
Joint reasons for judgment of Pincus J.A. and Helman J. and separate concurring reasons for judgment of Ambrose J.
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APPEAL ALLOWED WITH COSTS. ORDERS MADE BELOW SET ASIDE.
IN LIEU:
DECLARATION THAT RESPONDENTS NOT ENTITLED TO TERMINATE THE CONTRACT DATED 30 APRIL 1993 THE SUBJECT OF THESE PROCEEDINGS, AS THEY PURPORTED TO DO BY THEIR SOLICITOR’S LETTER OF 1 NOVEMBER 1993 AND THAT, NOTWITHSTANDING SUCH LETTER, THE CONTRACT REMAINED BINDING ON THE PARTIES. IT WILL BE FURTHER ORDERED THAT THE RESPONDENTS PAY THE COSTS OF THE PROCEEDINGS BELOW.
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CATCHWORDS: CONTRACT - right to waive benefit of condition - right to waive benefit of condition although condition unfulfilled - clause expressing "The parties acknowledge that this special condition . . . is solely for the benefit of the Purchaser" - no express right to affirm - right to terminate - Gange v. Sullivan (1966) 116 C.L.R. 418 at 443 - not solely for benefit of purchasers despite express provision - reconciliation of clauses of contract.
Counsel:Mr P D McMurdo QC for the appellants.
Mr M M Stewart for the respondents.
Solicitors:Gadens Ridgeway for the appellants.
Tobin & Co. for the respondents.
Hearing date: 11 July 1995.
JOINT REASONS FOR JUDGMENT OF PINCUS J.A. AND HELMAN J.
Judgment delivered 19/04/1996
This is an appeal from a judgment of the Supreme Court refusing an application by the appellants for declarations relating to a contract for the sale of real property. Under the contract, dated 30 April 1993, the respondents agreed to sell to the appellants certain commercial shops at Cairns for $750,000. Under special condition 1, the Standard Conditions of Sale approved by the Queensland Law Society Incorporated and adopted by the Real Estate Institute of Queensland in August 1990 formed part of the contract; those Standard Conditions were not in evidence before the primary judge and are not in the record, presumably on the basis that they contain nothing relevant to the present dispute.
The contract also contains a special condition 6, which makes the sale subject to the obtaining of a certain approval. The issues before the primary judge, raised again in this Court, were two: first, whether the appellants (the purchasers) had a right to waive the benefit of the condition as to approval and to call for settlement of the transaction, although the condition was unfulfilled, and secondly, whether if they had such a right they exercised it by a letter dated 29 October 1993. The primary judge held against the purchasers on both these points.
Condition 6 is as follows:
"6. Zoning - Council Consent
(a)The Vendors warrant and represent to the Purchaser that the Land is currently zoned ‘Main Business and Shopping’.
(b)This Contract and the performance of the Purchaser’s obligations hereunder is subject to and conditional upon the Cairns City Council (‘the Council’) granting on or before the date being sixty (60) days from the date hereof (the ‘Approval Date’) its consent for the use of that part of the land not currently leased for the conduct of a car hiring business (to include the storage of cars and a workshop) (‘the Approval’) on terms and conditions satisfactory to the Purchaser at his absolute discretion.
(c)The Purchaser shall make application for the Approval in the prescribed form and manner as soon as practicable after the date hereof and prosecute such application with due diligence. The Vendor shall sign all forms, applications, consents and other documents required in connection with the Purchaser’s application and otherwise assist (at the Purchaser’s expense) the Purchaser in securing the same. In particular but without limiting the obligation of the Vendor as aforesaid the Vendor shall allow the Purchaser and his agents to enter upon the subject property upon reasonable notice at all reasonable times in connection with the preparation of such application and the Vendor shall not obstruct or otherwise hinder the Purchaser in the exercise of such rights provided that the Purchaser in the exercise of those rights shall cause as little inconvenience as possible and no damage to either the Vendor or his property or the lessee and if any damage is so caused the Purchaser shall adequately compensate the Vendor or any lessee as the case may be therefore.
(d)If written notification of the Approval is received by the Purchaser prior to the Approval Date in terms satisfactory to the Purchaser then the Purchaser shall give the Vendor within three (3) days from and inclusive of the date of receipt of the Approval written notice of such receipt and the parties shall proceed to complete this purchase on the date being fourteen (14) days from and inclusive of the date the Purchaser gives such notice to the Vendor PROVIDED THAT if the Approval is not obtained by the Purchaser from the Council by the Approval Date or is obtained but is subject to conditions not acceptable to the Purchaser then the Purchaser shall elect by giving to the Vendor within three (3) days from and inclusive of the Approval Date or the receipt of the Approval as the case may be notice in writing to either rescind this Contract or to proceed to completion.
In the event that the Purchaser rescinds this Contract then the deposit paid by the Purchaser pursuant to the terms hereof shall be forthwith refunded to the Purchaser without any deduction whatsoever and this Contract shall be at an end.
In the event that the Purchaser elects under this sub-clause to proceed to complete this purchase then the date for completion shall be fourteen (14) days from and inclusive of the date upon which the Purchaser gives to the Vendor the notice of intention to proceed and the condition referred to in this clause shall be deemed waived by the Purchaser. The parties acknowledge that this Special Condition 6 is solely for the benefit of the Purchaser.
(e)For the purposes of this clause and the condition contained herein where on or before the Approval Date the Approval has been given by the Council on terms and conditions satisfactory to the Purchaser but the Council or any Government Authority or any other person or corporation (other than the Purchaser) has a right of appeal or review in relation to the Approval which, if exercised, may result in the Approval being withdrawn or qualified or made subject to a condition or conditions to which it is not subject at the time it is given then the Purchaser shall within three (3) days from and inclusive of the date of receipt by the Purchaser of written notification of the Approval elect by notice in writing to the Vendor or its Solicitors to either:-
(i)rescind this Contract whereupon the deposit paid by the Purchaser pursuant to the terms hereof shall forthwith be refunded to the Purchaser without any deduction whatsoever; or
(ii)extend the Approval Date (the ‘Extended Approval Date’) until:-
(A)where such right of appeal or review is not exercised - the day following the last day on which such right could by law have been exercised, or
(B)Where such right of appeal or review is exercised - the day following the day on which a decision is given pursuant to the exercise of any right of appeal or review itself becomes final and not subject to any further right of appeal or review provided that if such appeal or review is upheld which results in the Approval being withdrawn or qualified or made subject to conditions not satisfactory to the Purchaser then the Purchaser may within seven (7) days of the said decision terminate this Contract whereupon the deposit paid by the Purchaser shall be refunded to the Purchaser without any deduction whatsoever.
Provided however that if the later of such dates shall be a date later than six (6) months from the date hereof then either party may by notice in writing to the other terminate this Contract whereupon the deposit paid by the Purchaser pursuant to the terms hereof shall forthwith be refunded to the Purchaser without any deduction whatsoever.
If the Purchaser does not elect to terminate this Contract pursuant to this sub-clause then the date for completion shall be fourteen (14) days after the expiration of the Extended Approval Date. "
It will be noted that the last sentence of para. (d) reads "The parties acknowledge that this Special Condition 6 is solely for the benefit of the Purchaser".
It was argued that the presence of this provision dictated that the first point should be decided in favour of the purchasers. It is convenient to consider the construction of condition 6, in the first instance, as if the provision just quoted were not included in it.
Subclause (b) makes the approval date 60 days from the "date hereof"; since the contract is dated 30 April 1993, the approval date was 29 June 1993. Under subcl. (d) it is provided (omitting some detail) that if satisfactory approval is received before the approval date then the purchasers are to give notice to the vendors accordingly and completion is to take place in 14 days; but if no such approval is obtained, then the purchasers are given a choice, to be exercised within the time specified, either to rescind or to require completion - in the latter case, completion takes place, again, in 14 days.
There was some discussion before us as to what would happen under subcl. (d) if, instead of waiting to see whether approval was available, the purchasers decided to do without it and call for completion. Mr McMurdo Q.C., for the purchasers, argued that it is reasonably implicit in subcl. (d) that this can be done; the contention has some force. Under subcl. (d) if no approval is obtained the vendors must wait for 60 days before the purchasers’ obligation to choose between affirmation and rescission arrives; the purchasers have an absolute right, even if there is no approval, to require completion. If, instead of waiting the whole 60 days, the purchasers decide after, say, 30 days that no approval is likely to be forthcoming, or that they do not require an approval, it is not easy to see how the vendors are disadvantaged if the purchasers then call for completion within a reasonable time.
Under subcl. (e), again omitting some detail, if a satisfactory approval is given before 29 June 1993, but there is a right of appeal, then the purchasers may rescind the contract or extend the approval date until the day after the last day for appeal or, where an appeal is made, the day after the appeal is decided. As we understand the provision, the purchasers exercising the right of extension do not, at the time they exercise it, have to choose between those two dates; the extension takes the approval date up to one or the other of the two dates, depending on the course of events. Then subcl. (e) goes on to say in substance that if the appeal is upheld the purchasers may terminate the contract. There are of course other possibilities; the appeal may for example be dismissed or may be abandoned, and there is nothing in subcl. (e) to say what the rights of the parties then are. Nor indeed does the contract expressly say that if the appeal is upheld, destroying the approval, the purchasers may nevertheless require completion; but no doubt that is implicit. Some implications would also be necessary to deal with the circumstances that the appeal is dismissed or withdrawn.
The most important omission, however, from subcl. (e), for the purposes of the present dispute, is that it gives the purchasers no express right to affirm, in any circumstances. The closest approach to the grant of such a right is in the last sentence, which produces what might be called a deemed affirmation if the purchasers do not elect to terminate under the subclause.
Again, it is not on the face of it easy to see why (ignoring the effect of the last sentence of subcl. (d)) an implication of at least some right of affirmation should not be made in subcl. (e). The vendors must, under the subclause, wait for up to six months from the date of the contract to be told whether the transaction is to proceed. If an approval were granted and an appeal lodged which the purchasers thought to be likely, or certain, to fail, what harm is done to the vendors if the purchasers are taken to have a right to require completion, despite the pendency of the appeal? The implication of such a right does not contradict any express provision of subcl. (e) or any other part of the contract; in particular, it does not conflict with any right to require completion expressly given by subcl. (e), because as has just been noted there is no such right. Further, it is not easy to see why the purchasers should not be able to call for completion, where there is a right of appeal, rather than rescinding or extending the appeal date; the purchasers might be willing to take a chance that no appeal will be lodged, or that if lodged it will not succeed.
The relevance of these considerations is that one reason for declining to imply any general or particular right in a purchaser to require completion under such a contract is that the contract makes express provision for such a right. Such a provision is to be found only in subcl. (d), which applies where, to put it simply, there is no satisfactory approval by 29 June 1993. But where, as here, the condition does not seem to deal comprehensively with the circumstances which are likely to arise, there is less reason for holding that implications of a right to require completion are excluded.
To return to the facts, the parties agreed on 16 June 1993 to extend the approval date from 29 June 1993 to 6 July 1993 and that was later extended to 9 July 1993, by which time Cairns City Council had written to the purchasers to say that it intended to approve their application subject to certain conditions. Although that letter in terms merely intimated an intention to approve, it was treated by the parties as an approval within the meaning of condition 6, and it was common ground before us that the letter constituted such an approval. On 9 July 1993, the approval date was, by agreement, extended to 14 July, and on 13 July the purchasers’ solicitors wrote to the vendors’ solicitors to say in effect that objections having been received, the purchasers, pursuant to special condition 6(e), wished "to extend the Council’s approval date until determination of any objections". Although not accurately expressed, this letter was treated as an election to extend the approval date, under condition 6(e); in any event, by letter dated 14 July 1993 the vendors agreed "to the extended approval date as defined in the contract". A notice of appeal against the Council’s decision was filed on 2 August and after some further correspondence the vendors’ solicitors wrote to the purchasers’ solicitors on 19 October 1993 advising that "if the purchasers do not complete the purchase within six months of the date of contract then they propose to terminate the contract". That six month period expired 11 days later - i.e. on 30 October 1993. The purchasers sought a further extension of the approval date but that was refused, and on 29 October 1993 the purchasers purported to elect not to terminate the contract pursuant to special condition 6(e) and to call for completion on 15 November 1993. At that date the appeal against the Council approval was still pending.
To come back to subcl. (e), it is necessary to deal with the question: what, under the express terms of the subclause, were the parties’ rights in the events which happened? It has been noted that the purchasers were given, by para. (ii)(B), an express right to terminate, but that does not apply because it has to do only with the case where the appeal is upheld. Each party has a right to terminate under the proviso which follows that subparagraph and, in the events which happened, namely that an appeal was lodged, that right arose if the day following the day on which the appeal was decided was later than 30 October 1993. The appeal was never decided, but presumably one should read the proviso as creating a right of termination at the end of the six month period if the appeal has not by then been decided - although the proviso does not say so. The last sentence says that if the purchasers do not elect to terminate "pursuant to this subclause" then the date for completion is to be 14 days after the expiration of the extended approval date; since that date was, in the events that happened, the day of decision of the appeal (which had not been decided) there was no right or obligation to complete under that last sentence of the condition. It should be noted that there is a potential conflict between the last and second last sentences; that should we think be resolved by implying that the last sentence does not apply to the election to terminate referred to in the second last sentence, but only to that referred to in subpara.(ii)(B). The result is that neither party had under the express terms of the subclause a right to terminate or affirm on 29 October.
If the vendors are to succeed that must be on the contention that subcl. (e), properly construed, does not permit the purchasers to call for completion if, before the appeal mentioned in the subclause is determined, they wish to complete the contract. An oddity which arises from that construction is that, in such a situation as the present, the purchasers could force completion by consenting to the allowance of the appeal, thereby bringing about an obligation on each party to complete, under the last sentence of subcl. (e). But the vendors must say that, on its proper construction, the contract does not allow the purchasers to achieve completion, if they do not wish to insist on there being an approval, by the simpler means of waiving the whole condition and calling for completion.
We come now to the last sentence of subcl. (d), so far not taken into account. It contains an acknowledgement that this "Special Condition 6 is solely for the benefit of the Purchasers". The effect of such a provision, if taken literally, is that the condition may be waived by the party for whose benefit it was inserted: Gange v. Sullivan (1966) 116 C.L.R. 418 at 443. In the present case one cannot, despite the terms of the sentence just quoted, treat the whole condition as solely for the purchasers’ benefit.
There are provisions in the condition which must be held to be for the benefit of the vendors. One is contained in the proviso included in the first sentence of subcl. (d) which obliges the purchasers to make an election within the time specified. There is a right to require completion expressly given to the purchasers, but with a limitation attached to it, and in the circumstances there dealt with the purchasers could not we think require completion other than within the time limited; the right to insist on compliance with that time can be said to be for the benefit of the vendors. Then the second-last sentence of the condition, which allows either party to terminate in certain circumstances, must be treated as one which benefits the vendors, in the sense of giving them a right which they would not otherwise have.
But that provisions of this character, giving rights to the vendor, can be pointed to is not a justification for reading the last sentence of subcl. (d) out of the condition. Where parts of a clause or of a contract seem to clash, ordinarily the court will attempt to reconcile them, rather than ignoring one part. Here, reconciliation can be effected by treating the rights given to the vendors by the condition as exceptions to the proposition in the last sentence of subcl. (d): that sentence governs the parties’ rights except insofar as it is inconsistent with any specific right accorded to the vendors under the condition.
As has been explained above, the stage at which the transaction had arrived was governed by the scheme set out in subcl. (e) not subcl. (d); but the last sentence of subcl. (d) applies to the whole condition and its curious location does not, in our view, affect its construction. Looking now at subcl. (e), we can find nothing in it which expressly accords a right to the vendors, other than the second-last sentence, which gives a right of termination, but not one operative before the six month period mentioned in that sentence expires. Mr McMurdo Q.C., for the appellant, did not contend that the last sentence of subcl. (d) affects the parties’ rights after the expiration of the six month period; his contention was, in effect, that it gives the purchasers, in circumstances of the present kind, a right of waiver at any time during the six month period.
As a general proposition, that appears to us to be correct. To put the matter at the lowest, if the last sentence of subcl. (d) were not there, it might be questionable whether the purchasers would have had a right to waive the condition, so far as that could be done without conflicting with rights given to the vendors by the condition; the last sentence of subcl. (d), to our minds, has the effect of resolving that uncertainty in favour of the purchasers. It appears that the vendors’ submission gives no effect to the sentence in question, treating it as surplusage.
It must be held that the purchasers were entitled to waive the condition on 29 October 1993, being a date within the six month period mentioned in the proviso to subcl. (e).
The next question is whether that right was exercised by the letter of 29 October 1993. The argument to the contrary is that the letter did not in terms rely on any right arising from the last sentence of subcl. (d), but referred only to subcl. (e) and was so expressed as to encourage the vendors to think that no right, other than one expressed in subcl. (e), was being asserted.
The purchasers’ difficulty is created by the purported election not to terminate which the letter expresses. As has been pointed out, subcl. (e) creates two rights of termination in the purchasers, but plainly neither of them applied. Therefore, the purported election not to terminate under the subclause had no legal effect. It should be added that no case is made that the vendors were in fact misled by the implicit assertion on the part of the purchasers that subcl. (e) gave them, in the circumstances, a right to terminate; there is no reason to think that if the mistaken reference to termination had been excluded from the letter the vendors would have done other than what they did, which was to purport to terminate themselves. In these circumstances the reference should be treated as of no real significance and one is left with the purchasers’ clear call for completion. Had the purchasers written merely calling for completion, that would necessarily have implied a waiver of the condition which had not, on 29 October, been fulfilled. It is our view that it would be pedantic to treat the mention of election not to terminate as altering what would otherwise have been the legal effect of the letter. It should be added that counsel for the vendors disclaimed any contention that the time by the letter fixed for completion was other than reasonable.
It is perhaps permissible to note that, looking at the case broadly, the result which follows, namely allowance of the appeal, does not appear to be unjust; as has been pointed out, the vendors on 19 October wrote in terms which imported that they desired early completion of the contract and that is what, on 29 October, they were offered.
The appeal is allowed with costs and the orders made by the learned primary judge set aside. In lieu of those orders there will be a declaration that the respondents were not entitled to terminate the contract dated 30 April 1993 the subject of these proceedings, as they purported to do by their solicitor’s letter of 1 November 1993 and that, notwithstanding such letter, the contract remained binding on the parties. It is further ordered that the respondents pay the costs of the proceedings below.
REASONS FOR JUDGMENT - B.W. AMBROSE J.
I have had the advantage of reading the reasons for judgment of Pincus JA and Helman J which sufficiently set out the relevant facts and issues canvassed in this appeal.
I agree that the appeal should be allowed and that the proposed declaration should be made.
Although condition 6 is not drawn with precision, it is clear that it is designed to give the purchasers an election to rescind if they do not obtain council planning consent to use part of the land, the subject of the contract, for the purpose of a car hiring business.
To the extent that 6(d) and (6e) provide for fixing the date for completion they do so only by reference to the obtaining of such planning consent.
The object of this condition is achieved in substance by 6(b) under which the performance of the contract by the purchasers is conditional upon the council giving planning consent on terms satisfactory to them.
Although upon the wording of 6(b) "the contract" itself is also expressed to be so conditional, in my view that adds nothing of substance to the equally express wording that performance of the purchasers' obligations under it are conditional. It is only council approval on terms satisfactory to the purchasers in their absolute discretion which is required to satisfy both the enforceability of the contact by the parties to it and the performance by the purchasers of their obligations under it.
To the extent that 6(b) makes the contract conditional it is of similar import to that considered in Sandra Investments Pty Ltd v. Booth (1982) 153 CLR 153 where Gibbs J, at p. 157, said of the clause there under consideration that:"The approval in cl. 24 was expressed in the form of a condition precedent, but it was a condition precedent not to the formation of the contract but to the obligation to complete it."
At p. 159 he continued:
"If the matter is approached by asking whether cl. 24 was a condition solely for the benefit of the purchaser, so that the purchaser was entitled to waive performance of it, ... It was argued that the condition was not one solely for the benefit of the purchaser for two main reasons. First it was submitted that the provisions of cl. 24 were 'so inextricably mixed up with the other parts of the transaction that they could not be severed', to use the words of Hawksley v. Outram ... If cl. 24 did not contain the words giving the purchaser the option to cancel the contract the case might resemble Heron Garage Ltd v. Moss [1974] 1 WLR 148, where a provision in the contract that completion would take place on the expiration of one month from the receipt of a planning consent was regarded as supporting the conclusion that a stipulation making the agreement conditional upon the obtaining of the consent could not be waived: see at p. 154. Similarly in Sheridan v. Nikolic [1982] Qd R 725, the date for completion was expressed to be 'within 14 (fourteen) days of notification of registration as per clause 24', and cl. 24 provided that the contract was subject to and conditional upon a realignment of a boundary and the registration of a plan of subdivision; by cl. 25 it was provided that in the event of that condition not being complied with the contract should become null and void. It was held that the condition stated in cl. 24 could not be unilaterally waived by the purchaser, because the date for completion could only be determined if the condition was fulfilled. However in neither of those conditions was there any provision giving the purchaser a right to choose whether or not the contract should be cancelled if the condition was not fulfilled, and the cases are distinguishable for that reason."
At p.161 while commenting that in every case one must have regard to the words of the particular contract in question, his Honour observed with respect to the contract he was there considering:
"The provisions of cl.24 show unequivocally that the parties intended that the consequence of a failure to obtain the council's approval should be that the purchaser would have the option either to cancel the contract or to proceed to carry it into effect. The purchaser chose the latter course."
In that case both Gibbs CJ with whom Mason and Murphy JJ agreed, and Wilson J expressed the view that once it was decided upon a proper construction of the contract that the purchaser could choose to allow it to remain on foot notwithstanding a failure to obtain the council planning approval there was no difficultly in holding that completion should take place within a reasonable time from the date upon which the purchaser exercised its option - i.e. waived fulfilment of the condition which was solely for his benefit: see at pp. 158 per Gibbs J and 164 per Wilson J. A waiver of 6(b) would not therefore make the contract unenforceable because of the absence of any expressly stated date for completion.
However condition 6(b) be characterised, in my view, it is inserted solely for the benefit of the purchasers. In this respect I refer to the discussion in George v. Roach (1943) 67 CLR 256 particularly at pp. 259, 260 per Latham CJ, p. 260 per Rich J and p. 263 per Stark J.
In my view, condition 6 generally is clearly severable from the rest of the contract and thus may be waived by the purchasers.
Condition 6(c) is merely ancillary to 6(b) and is designed to facilitate the prompt application for and securing of council planning consent. In effect it requires each of the purchasers and vendors to promptly take steps necessary to secure council planning consent.
Condition 6(d) provides for two contingencies:
Receipt by the purchasers of council planning approval on terms satisfactory to them within 60 days of the signing of the contract - i.e. by 29 June 1993 - the "approval date"; and
non receipt of such an approval by the approval date.
In the event of (i), subject to 6(e), both purchasers and vendors must proceed to complete the contract within 14 days of the purchasers giving written notice of receipt of approval to the vendors (the notice must be given within 3 days of such receipt).
In the event of (ii), the purchasers must elect in writing within 3 days of the refusal date or, as the case may be, of receipt of an approval in terms not acceptable to them to either rescind the contract or proceed to completion.
If the purchasers give written notice of election to proceed, then again the purchasers and vendors must complete with 14 days of the date of that written election.
In the event of the purchasers' election to proceed in spite of a satisfactory approval not having been received from the council, 6(d) goes on to provide:"... the condition referred to in this clause shall be deemed to be waived by the purchaser. The parties acknowledge that this special Condition 6 is solely for the benefit of the purchaser."
I would construe "the condition referred to in this 'clause' above as referring to 6(b) which makes the contract and/or the performance of the purchasers' obligations under it conditional upon obtaining council planning consent satisfactory to the purchasers. The waiver contemplated is to the obtaining of council planning consent by the purchasers.
For the same reason I would construe the "special condition 6" acknowledged to be solely for the benefit of the purchasers as referring to the substance of cl. 6(b).
In my view 6(d) is only ancillary to 6(b) and designed to regulate and constrain the rights of the purchasers to either affirm or rescind the contract in the event that they do not receive within the specified time a council approval satisfactory to them.
Condition 6(e) in my view is also ancillary to 6(b). Its object is to preserve the rights of the purchasers to rescind if council approval acceptable to them may be or is altered upon appeal so that the approval given by the council is overturned or becomes subjected to conditions which are unsatisfactory to them. If an approval satisfactory to the purchasers is given by council by the approval date and is subject to appeal by somebody other than the purchasers which might result in it being "withdrawn" or qualified in some way to make it different from the approval which satisfied them then within 3 days of receipt of the written approval the purchasers must elect in writing to either -
rescind the contract; or
extend the approval date to the later of -
(a)the day after the appeal period expires; or
(b)if an appeal is instituted, the day after the appeal decision is given.
The applicable date is defined to mean "the extended approval date".
A council approval may be given upon such terms (or in the absence of terms) that the purchasers foresee difficulty in opposing an appeal successfully.
If an appeal results in council approval being withdrawn or qualified so that it is no longer satisfactory to the purchasers, then the purchasers may, within 7 days of the delivery of the appeal decision, rescind the contract.
A proviso to 6(e) then provides that if "the latter of such dates" - presumably the "extended approval date" being the date on which final judgment on appeal is given - is a date more than 6 months after the date of contract, then either the vendors or the purchasers may by notice in writing to the other elect to terminate the contract.
If the purchasers do not so elect (and presumably if the vendors have not within that time so elected) the date for completion is 14 days after the extended approval date.
6(e) is designed to define the rights of vendors and purchasers with reference to the appeal provisions of the Local Government (Planning and Environment) Act and their possible or actual impact upon the planning consent given by the council. It also defines their rights to avoid their obligations under the contract in the event that the decision upon any appeal instituted against the planning consent given to the purchasers has not been given within 6 months of the signing of the contract.
Upon the facts of this case which are outlined in the reasons of Pincus JA and Helman J it is unnecessary on my view to embark upon a detailed consideration of the extent to which the vendors might be said to benefit from the right they are given (along with the purchasers) to rescind the contract in the event of the "extended approval date" being later than 6 months from date of contract. The last paragraph of 6(e) might arguably limit the right of the vendors to rescind after the expiration of 14 days of the extended approval date. However, it is quite unnecessary to determine this point. On the facts of this case, the "extended approval date" as defined and as varied by vendors and purchasers, was 30 October 1993 and whatever right was given to the vendors to rescind under 6(e) it was not exercisable on or before 29 October 1993 when the purchasers purported to waive the condition contained in 6(b). As I have indicated in my view at that time 6(b) was solely for their benefit.
It is unnecessary to give consideration to what may have been the position had the purchasers purported to waive the condition on or after 30 October 1993. The right to rescind given under 6(e) during whatever time the vendors may have been able to exercise it, stood quite independently of the right of the purchasers to waive 6(b) which at all material times was for their benefit only; 6(e) was only ancillary to 6(b) and was designed to specify the rights of the parties in the event of delay in the completion of the appeal process beyond 6 months of the signing of the contract. To the extent that the right to rescind given to purchasers and vendors under 6(e) was for the benefit of both, it depended upon the specified period of delay in obtaining a final decision on appeal and not upon the obtaining of the council approval which gave birth to that appeal. Although the council approval was the basis of any decision which might be given upon appeal against it, it necessarily stood quite independently of that appeal decision for the purpose of defining the rights of the vendors and purchasers at a time prior to the arising of the right given to them to rescind under 6(e).
I agree that the appeal should be allowed with costs and that the other orders proposed by my brothers should be made.
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