Pittmore Pty Ltd v Chan

Case [2020] NSWCA 344


Court of Appeal


Supreme Court


New South Wales

  • Summary available
  • Amendment notes
Medium Neutral Citation: Pittmore Pty Ltd v Chan; Chan v Tan [2020] NSWCA 344
Hearing dates: 18,19 November 2020
Decision date: 18 December 2020
Before: Bell P at [1];
Leeming JA at [2];
Brereton JA at [214].
Decision:

1. Grant leave to appeal, direct Pittmore to file a notice of appeal in accordance with the draft notice of appeal, and otherwise dispense with the requirements of service.

2. Appeal dismissed.

3. Grant leave to cross-appeal, direct Mr Chan to file a notice of cross-appeal in accordance with the draft notice of cross-appeal, and otherwise dispense with the requirements of service.

4. Cross-appeal dismissed.

5. Subject to order 7 below, Pittmore to pay Mr Chan’s costs of the appeal.

6. Subject to order 7 below, Mr Chan to pay Pittmore’s and Mr Joo Kee Tan’s costs of the cross-appeal.

7. No part of the cost of providing the eight volumes of white folders filed on 3 November 2020 is to be passed on by David Kam & Co, with the intent that the entirety of those costs be borne by that firm.

Catchwords:

CONTRACTS – construction – whether mistake in written agreement can be rectified by construction – inconsistency concerning right to terminate on face of document – primacy given to handwritten amendments

COSTS – appeal books – unnecessary reproduction of thousands of pages already reproduced in appeal books – whether special order as to costs warranted

DEEDS – delivery – whether deed restating terms of joint venture delivered to other side in escrow – whether terms of document precluded finding of delivery in escrow – whether deed even if not delivered effective as simple contract

ELECTION AND WAIVER – where one party continued to perform work and incur expenses pursuant to joint venture after a contractual right of termination had accrued – absence of any reservation of rights – significance of “no waiver” clause

EQUITY – ancillary liability – liability for procuring or inducing breach of trust or breach of fiduciary duty – whether requirement that third party be “dishonest” – whether separate bases of liability for procuring as opposed to inducing breach – whether director of company acting as such capable of procuring or inducing breach of trust by director's company

EQUITY – rectification – whether contract should be rectified in equity if mistake incapable of being corrected by construction

EQUITY – unconscionability – statutory unconscionability – joint venture to develop land for resale – offer made to one party to sell part of joint venture land at profit – offer communicated to other party with invitation to share profit – other party sought to persevere with joint venture – first party purported to terminate and sell land – finding that first party believed entitled to terminate – in fact first party not entitled to terminate – first party’s conduct not unconscionable contrary to s 21 of Australian Consumer Law

Legislation Cited:

Australian Consumer Law, s 21

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AGLC
Pittmore Pty Ltd v Chan [2020] NSWCA 344
Case
[2020] NSWCA 344
Decision Date

CaseChat Overview and Summary

In the case of *Pittmore Pty Ltd v Chan*, the dispute concerned a joint venture agreement for the development and resale of land. Pittmore Pty Ltd (Pittmore) sought to terminate the agreement and sell a portion of the land, while Mr Chan sought to uphold the joint venture. The case was heard on appeal.

The primary legal issues before the court were whether a written agreement could be rectified by construction due to an inconsistency, the effect of handwritten amendments on the interpretation of the agreement, whether a deed restating the joint venture terms was delivered in escrow, and whether a party's continued performance of the agreement after a purported termination constituted an election or waiver of their rights, particularly in light of a "no waiver" clause. The court also considered ancillary liability for procuring or inducing breach of trust or fiduciary duty, and whether a director's company could be liable for such breaches. Finally, the court examined whether the conduct of Pittmore was unconscionable under section 21 of the Australian Consumer Law.

The Court of Appeal held that handwritten amendments to a contract were to be given primacy over printed terms where there was an inconsistency. It found that the deed was not delivered in escrow, but was effective as a simple contract. The court determined that Mr Chan had not waived his rights by continuing to perform the agreement, as his actions were consistent with the continued existence of the joint venture and he had not elected to affirm the termination. Regarding ancillary liability, the court found that a director acting as such could be capable of procuring or inducing a breach of trust by their company. The court also found that Pittmore's conduct, while based on a mistaken belief of its entitlement to terminate, was not unconscionable under the Australian Consumer Law.

The appeal and cross-appeal were dismissed. Pittmore was ordered to pay Mr Chan's costs of the appeal, and Mr Chan was ordered to pay Pittmore's and Mr Tan's costs of the cross-appeal. A special order was made regarding the costs of the appeal books, stipulating that the costs of eight volumes of white folders were not to be passed on by David Kam & Co, meaning that firm was to bear those costs entirely.

Orders

Orders of the court

1. Grant leave to appeal, direct Pittmore to file a notice of appeal in accordance with the draft notice of appeal, and otherwise dispense with the requirements of service.

2. Appeal dismissed.

3. Grant leave to cross-appeal, direct Mr Chan to file a notice of cross-appeal in accordance with the draft notice of cross-appeal, and otherwise dispense with the requirements of service.

4. Cross-appeal dismissed.

5. Subject to order 7 below, Pittmore to pay Mr Chan’s costs of the appeal.

6. Subject to order 7 below, Mr Chan to pay Pittmore’s and Mr Joo Kee Tan’s costs of the cross-appeal.

7. No part of the cost of providing the eight volumes of white folders filed on 3 November 2020 is to be passed on by David Kam & Co, with the intent that the entirety of those costs be borne by that firm.

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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