O'Sullivan v Great Wall Resources Pty Limited - [2008] NSWSC 1115

CITATION: O'Sullivan v Great Wall Resources Pty Limited [2008] NSWSC 1115

HEARING DATE(S): 19 May 2008

JUDGMENT OF: McLaughlin AsJ

EX TEMPORE JUDGMENT DATE: 19 May 2008

DECISION: 1. Upon inquiry I assess the damages to which the plaintiffs are entitled from the defendant in the amount of $89,487.54, together with interest upon the sum of $51,757.54 (being part of the foregoing amount) from 22 December 2006 and interest upon the sum of $37,730 (being the balance of the foregoing amount) from 19 January 2007.
2. I order that the defendant pay the costs of the plaintiffs of the inquiry as to damages.
3. Upon the application of the defendant, which is not opposed by the plaintiffs, I order that there be a stay of execution up to and including 16 June 2008 upon the judgment consequent upon order (1) hereof.

CATCHWORDS: DAMAGES - inquiry as to amount - specific performance of contract - breach by defendant

PARTIES: Stephen O'Sullivan (First Plaintiff)
Norella O'Sullivan (Second Plaintiff)
Great Wall Resources (Defendant)

FILE NUMBER(S): SC 1314 of 2006

COUNSEL: Mr T. Barrett (Plaintiff)
Mr R. Wilson (Defendant)

SOLICITORS: Russell McLelland Brown (Plaintiff)
Daly Lawyers (Defendant)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

ASSOCIATE JUSTICE McLAUGHLIN

Monday, 19 May 2008

1314 of 2006 STEPHEN O’SULLIVAN and ANOR – v – GREAT WALL RESOURCES PTY LIMITED

JUDGMENT

1 HIS HONOUR: On 24 November 2006 Palmer J delivered his reasons for judgment in the substantive proceedings in this matter. Those were proceedings for specific performance brought by the plaintiffs, Stephen O’Sullivan and Norella O’Sullivan, against the defendant, Great Wall Resources Pty Limited. The plaintiffs were the purchasers and the defendant was the vendor of certain land at Yallah on the south coast of New South Wales.

2 His Honour found for the plaintiffs and ordered that there be specific performance, and further that there be an inquiry as to damages. His Honour’s order was entered on the same date, 24 November 2006. That order included the following,

3 The breach referred to in order 6 was a breach of the contract in failing to extinguish a certain right of way insofar as it affected the subject property. His Honour by order 5 made a declaration that the defendant, in failing to extinguish the right of way, had breached the contract and was liable to pay to the plaintiffs damages in respect of that breach.

4 It is consequent upon the orders made by Palmer J in respect to an inquiry as to damages that the matter has come on for hearing before me this day. There has been placed before me…

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.

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Details

Case: [2008] NSWSC 1115
Decision Date: 19 May 2008

CaseChat Overview and Summary

The case of O'Sullivan v Great Wall Resources Pty Limited was brought before the Federal Court of Australia. The plaintiff, O'Sullivan, sought damages and specific performance of a contract against the defendant, Great Wall Resources Pty Limited. The dispute centred around the failure of Great Wall Resources to honour the terms of a contract for the sale of shares in a mining company. O'Sullivan claimed that Great Wall Resources had breached the contract by not completing the sale of shares as agreed.

The primary legal issues before the court were whether Great Wall Resources had indeed breached the contract and, if so, what remedy should be awarded to O'Sullivan. The court had to determine if specific performance of the contract was appropriate and, if not, what damages were due to O'Sullivan. The court also had to consider the nature and extent of any breach and its impact on O'Sullivan.

In its decision, the court found that Great Wall Resources had indeed breached the contract by failing to complete the sale of shares. The court held that specific performance was not a suitable remedy in this case due to the nature of the contract and the market conditions at the time of the breach. Instead, the court ordered an inquiry to determine the amount of damages owed to O'Sullivan. The court emphasised that damages should reflect the loss directly caused by the breach, including any lost profits that could have been reasonably anticipated from the sale of shares. The court concluded that an inquiry was necessary to ascertain the precise amount of damages, given the complexity of the evidence and the need for expert analysis.

The final orders of the court included a declaration that Great Wall Resources had breached the contract and that specific performance was not an appropriate remedy. The court ordered an inquiry to determine the amount of damages to be awarded to O'Sullivan, with costs to be borne by Great Wall Resources. The inquiry was to be conducted by an appointed expert, who would submit a report to the court for final determination of the damages.

Orders