Reported Decision: (2008) NSW Conv R 56-205(2008) ANZ Conv R 8-10
New South Wales
Court of Appeal
CITATION: PALASTY v PARLBY [2007] NSWCA 345 HEARING DATE(S): 12 June 2007
JUDGMENT DATE:
6 December 2007JUDGMENT OF: Mason P at 1; Tobias JA at 64; Handley AJA at 65 DECISION: Appeal dismissed with costs CATCHWORDS: DAMAGES – Measure and remoteness of damages in actions for breach of contract – remoteness – liabilities incurred – vendor and purchaser – completion of sale under first contract relied upon by plaintiff to enter into a second contract for purchase of another property – first contract breached by defendant – plaintiff unable to complete second contract – losses resulting from breach of second contract - DAMAGES – Measure and remoteness of damages in actions for breach of contract – remoteness – other cases – interest damages – where timely receipt of monies needed and known to both parties – where return of property under first contract at date of termination does not compensate adequately for losses stemming from the breach - In March 2000 the appellant (the purchaser) contracted to purchase from the respondent (the vendor) a home at Hunters Hill. The price was $3,150,000 and a deposit of $315,000 was paid on exchange. In April 2000, in reliance upon the purchaser completing the contract, the vendor entered into a contract to purchase a home in Killara. The vendor paid the customary ten per cent deposit on that contract. - In May 2000, after the nominated completion date for the Hunters Hill contract had passed and after the issuing of notice to complete, the vendor terminated the contract and the purchaser’s deposit was forfeited. As a result of the termination, the vendor was also unable to complete the purchase at Killara and suffered the forfeiture of the deposit he had paid on that contract. LEGISLATION CITED: Civil Procedure Act 2005
Uniform Civil Procedure Rules 2005CASES CITED: Alexander v Cambridge Credit Corporation Ltd (1987) 9 NSWLR 310
Castle Constructions Pty Ltd v Fekala Pty Ltd (2006) 65 NSWLR 648
Commonwealth v Amann Aviation Pty Limited (1991) 174 CLR 64
Commonwealth v SCI Operations Pty Ltd (1998) 192 CLR 285
Delbridge v Low [1990] 2 Qd R 317
Gould v Vaggelas (1985) 157 CLR 215
Hadley v Baxendale (1854) 9 Exch 341; 156 ER 145
Hexiva Pty Ltd v Lederer (No 2) [2007] NSWSC 49
Heydon v NRMA Ltd (No 2) (2001) 53 NSWLR 600
Holland v Hardy (1882) 3 LR(NSW) 450
Hungerfords v Walker (1989) 171 CLR 125
Jackson v Royal Bank of Scotland plc [2005] 1 WLR 377 (HL)
Jampco Pty Ltd v Cameron (No 2) (1986) NSW Conv R 55-275
Koufos v C Czarnikow Ltd [1969] 1 AC 350
Leggott v Metropolitan Railway Co (1870) LR 5 Ch App 716
Leighton Contractors Pty Ltd v Queensland Insurance Co Ltd (4 October 1978, unreported)
London Chatham and Dover Railway Co v South Eastern Railway Co [1893] AC 429
Robinson v Harman (1848) 1 Ex…
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Details
- AGLC
- Palasty v Parlby [2007] NSWCA 345
- Case
- [2007] NSWCA 345
- Decision Date
CaseChat Overview and Summary
In the Supreme Court of New South Wales, the appellant (purchaser) appealed a decision concerning damages arising from a breached contract for the sale of a property at Hunters Hill. The respondent (vendor) had terminated the contract after the purchaser failed to complete the purchase, resulting in the forfeiture of the purchaser's deposit. The vendor, having relied on the completion of this sale to purchase another property in Killara, was subsequently unable to complete that second purchase and forfeited the deposit paid for it.
The central legal issues before the court were the measure and remoteness of damages recoverable by the vendor for the purchaser's breach of contract. Specifically, the court had to determine whether the vendor's loss of the deposit paid on the Killara property was a foreseeable consequence of the purchaser's breach of the Hunters Hill contract, and whether the return of the Hunters Hill property at the date of termination adequately compensated the vendor for its losses.
The court reasoned that the vendor's loss of the Killara deposit was a foreseeable consequence of the purchaser's breach. It was established that the vendor had entered into the Killara contract in reliance on the completion of the Hunters Hill sale, and that the timely receipt of the purchase monies was known to both parties to be essential. The court held that the return of the Hunters Hill property did not adequately compensate the vendor for the losses stemming from the breach, particularly the forfeiture of the Killara deposit.
The appeal was dismissed, and the appellant was ordered to pay the costs of the appeal.
The central legal issues before the court were the measure and remoteness of damages recoverable by the vendor for the purchaser's breach of contract. Specifically, the court had to determine whether the vendor's loss of the deposit paid on the Killara property was a foreseeable consequence of the purchaser's breach of the Hunters Hill contract, and whether the return of the Hunters Hill property at the date of termination adequately compensated the vendor for its losses.
The court reasoned that the vendor's loss of the Killara deposit was a foreseeable consequence of the purchaser's breach. It was established that the vendor had entered into the Killara contract in reliance on the completion of the Hunters Hill sale, and that the timely receipt of the purchase monies was known to both parties to be essential. The court held that the return of the Hunters Hill property did not adequately compensate the vendor for the losses stemming from the breach, particularly the forfeiture of the Killara deposit.
The appeal was dismissed, and the appellant was ordered to pay the costs of the appeal.
Orders
Orders of the court
Appeal dismissed with costs. IN THE SUPREME COURT OF NEW SOUTH WALES
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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