Meriton Apartments Pty Limited v The Owners Strata Plan No. 72381

Meriton Apartments Pty Limited, the caretaker, sought to enforce a caretaker agreement against the Owners Strata Plan No. 72381, one of the owners corporations, and others. The dispute centred around the validity and enforceability of the caretaker agreement, the rights and obligations of the parties, and the consequences of alleged breaches. The case was heard in the Supreme Court of New South Wales.

The court addressed several legal issues, including whether the caretaker agreement bound the owners corporation that did not formally execute it, whether the contractual termination provision excluded common law rights, whether the caretaker was in "serious persistent and continuing" breach, and whether the owners corporation could act unilaterally to terminate the agreement. The court also considered the admissibility of evidence obtained using a listening device, the existence and breach of any fiduciary duty owed by the developer to the owners corporation, and the implications of repudiation on the contract.

The Supreme Court found that the caretaker agreement bound the owners corporation that did not formally execute it, as it was intended to be a tripartite agreement. The contractual termination provision did not exclude common law rights of termination. The caretaker was found to be in "serious persistent and continuing" breach, but the owners corporation could not unilaterally terminate the agreement due to procedural deficiencies. The court held that the agreement remained on foot following repudiation, and the innocent party could continue to perform the contract and claim the whole of the promised benefit. The use of the listening device was deemed admissible due to implied consent and necessity for protection of interests. The court found that the developer owed a fiduciary duty to the owners corporation, which was breached when the agreement was entered into. However, the owners corporation was barred by delay from setting aside the agreement.

The court ordered that the caretaker agreement remain in effect, and the owners corporation must comply with its terms. The caretaker was to be compensated for the period of the agreement. The developer was ordered to pay damages to the owners corporation for breach of fiduciary duty. The use of the listening device was upheld as admissible evidence.