Piety Developments Pty Ltd v Cumberland City Council

[2024] NSWCA 18

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation:

Piety Developments Pty Ltd v Cumberland City Council [2024] NSWCA 18

Hearing dates:

5 February 2024

Date of orders:

5 February 2024

Decision date:

05 February 2024

Before:

Gleeson JA

Decision:

(1)   That order (2) made by Parker J on 15 December 2023 be stayed pending the determination of the appeal.

(2)   Note the undertaking given by the appellant by its counsel to prosecute the appeal with due diligence.

(3)   Expedite the hearing of the appeal.

(4)   Grant leave to the parties to approach the Registrar to obtain a hearing date with an estimate of one day.

(5)   Stand over the proceedings before the Registrar on 12 February 2024 and direct the parties to agree in advance of that date a timetable for the preparation of the appeal books and exchange of written submissions.

(6)   Costs of the appellant’s motion filed 2 February 2024 will be costs in the cause.

Catchwords:

CIVIL PROCEDURE — stay of judgment pending appeal — where primary judge dismissed claim for specific performance of contract for sale of land and discharged injunction restraining respondent Council from considering rescission motion — where respondent acknowledged that appeal raised serious issues — whether balance of convenience or balance of hardship favours stay of order discharging interlocutory injunction

Cases Cited:

Alexander v Cambridge Credit Corporation Ltd (1985) 2 NSWLR 685

Kalifair Pty Ltd v Digi-Tech (Australia) Ltd (2002) 55 NSWLR 737; [2002] NSWCA 383

Category:

Procedural rulings

Parties:

Piety Developments Pty Ltd (Appellant)
Cumberland City Council (First respondent)
Bilal El-Cheikh (Second respondent)

Representation:

Counsel:
Mr F Corsaro SC (Appellant)
Mr A J McInerney SC (First respondent)

Solicitors:
Darby Jones Lawyers (Appellant)
McCabes Lawyers (First respondent)

File Number(s):

2024/14852

 Decision under appeal 

Court or tribunal:

Supreme Court of New South Wales

Jurisdiction:

Equity Division

Citation:

[2023] NSWSC 1627

Date of Decision:

15 December 2023

Before:

Parker J

File Number(s):

2022/38975

Judgment

1. GLEESON JA: Application is made by the appellant, Piety Developments Pty Ltd (Piety), for a stay pending appeal against the orders made by Parker J on 15 December 2023 dismissing Piety’s claim and discharging the interlocutory injunction granted by the Court below on 9 February 2022, as extended on 14 February 2022 until further order: Piety Developments Pty Ltd v Cumberland City Council (No 3) [2023] NSWSC 1627.

2. Piety was the plaintiff in the proceedings below; it sought specific performance of an alleged contract for sale of land at Lidcombe between the Council as vendor and Piety as purchaser. The injunction granted below was in the following terms:

4.   Upon provision of an undertaking as to damages by the Plaintiff, made through its counsel, to pay the applicable filing fees as soon as practicable an interim injunction, until further order of the Court, from the Defendant taking any action to rescind the resolution of the Defendant dated 3 November 2021 concerning the sale of the property located at 13 John Street, Lidcombe NSW 2141 (the Property) on the basis that it:

a.   would be based on a nullity; or

b.   would be in threatened breach or repudiation of the Agreement.

3. At the time of giving judgment, order (2) made by Parker J stayed the discharge of the interlocutory injunction until five weeks after the delivery of the Court’s reasons for judgment. On 25 January 2024, the Registrar of the Court made orders by consent that order (2) made by Parker J on 15 December 2023 be stayed until 6 February 2024.

4. The Council opposes a further extension of the stay of order (2) below, contending that no prejudice has been established by the appellant, were the stay not extended. The Council offered an undertaking in the following terms:

On a without admissions basis:

Cumberland Council (Council) undertake to Piety Developments Pty Ltd (Piety) that following the outcome of Council’s Recission [sic] Motion lodged 3 November 2021, that it will not dispose of or encumber the subject land (at 13 John Street, Lidcombe NSW) until conclusion of the appeal filed by Piety, on the basis that Piety will apply for expedition of the appeal, to which Council will consent.

Stay application

5. It is necessary to consider whether the appeal raises a serious question to be tried, in the sense of arguable grounds, and if so, where the balance of convenience lies: Alexander v Cambridge Credit Corporation Ltd (1985) 2 NSWLR 685 at 694-695; Kalifair Pty Ltd v Digi-Tech (Australia) Ltd (2002) 55 NSWLR 737; [2002] NSWCA 383 at [17]-[20].

Whether reasonably arguable appeal

6. It is well-established that the Court will not generally speculate upon the appellant’s prospects of success but may make some preliminary assessment about whether the appellant has an arguable case, in order to exclude an appeal lodged without any real prospects of success simply to gain time: Kalifair at [18]-[19]. That is not necessary in the present case as senior counsel for the Council accepts that the grounds of appeal raise serious issues, albeit the Council’s position is that the appeal is a weak case. Having considered the grounds of appeal and noting the concession by the Council, I proceed on the basis that the appeal is at least arguable.

Balance of convenience

7. Turning to the question of the balance of convenience or the balance of hardship, the principal issue is whether the asserted prejudice to Piety, if the stay is not granted with the consequence that the injunction is discharged, is outweighed by the asserted prejudice to the Council if a stay is granted.

8. The effect of the injunction granted below is to prevent the Council from considering the rescission motion in respect of the Council’s resolution of 3 November 2020 accepting Piety’s offer to purchase the Lidcombe land and delegating authority to the General Manager to execute the documents. The rescission motion was lodged shortly after the conclusion of the Council meeting on 3 November 2020.

9. Piety says that it would be prejudiced if the rescission motion was now passed because, if the appeal succeeds, that event could be relied upon by the Council as a discretionary argument as to whether or not specific performance is an appropriate remedy. The Council’s response is that if the rescission motion were permitted and carried (a) that may limit Piety’s relief to damages, and (b) the Council would rely upon the passing of the rescission motion as post-contractual conduct, which would be relevant to whether or not there had been any acceptance (by Council) of Piety’s offer in the first place.

10. At trial, Council had advanced a related argument that Council’s statutory right (indeed, obligation) to allow the rescission motion to proceed was a reason why, even if a binding and enforceable contract had been entered into, only damages could be recovered. Piety responded that any power of rescission the Council might have could not be used to override accrued legal rights, including a right to specific performance. The primary judge referred to these arguments but did not find it necessary to decide that question: at [120].

11. Given that the parties are at issue as to the legal significance of any rescission motion for the relief sought by Piety on appeal, I am persuaded that it is appropriate to maintain the status quo until the determination of the appeal. Accordingly, I have concluded that a stay of the discharge of the interlocutory injunction granted below, pending the determination of the appeal is appropriate.

Orders

12. For the above reasons, the Court orders:

1. That order (2) made by Parker J on 15 December 2023 be stayed pending the determination of the appeal.

2. Note the undertaking given by the appellant by its counsel to prosecute the appeal with due diligence.

3. Expedite the hearing of the appeal.

4. Grant leave to the parties to approach the Registrar to obtain a hearing date with an estimate of one day.

5. Stand over the proceedings before the Registrar on 12 February 2024 and direct the parties to agree in advance of that date a timetable for the preparation of the appeal books and exchange of written submissions.

6. Costs of the appellant’s motion filed 2 February 2024 will be costs in the cause.

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Decision last updated: 06 February 2024