Proctor v Chahl

[2008] NSWSC 1252

CITATION:	Proctor v Chahl [2008] NSWSC 1252
HEARING DATE(S):	4 and 5 November 2008
JUDGMENT DATE :	26 November 2008
JURISDICTION:	Equity Division
JUDGMENT OF:	Ward J at 1
DECISION:	Judgment for defendants/cross claimants.
CATCHWORDS:	CONVEYANCING – Contract for sale of land – Whether contract validly terminated – Notice to complete given before completion date, as properly construed, had expired – Whether Vendors otherwise entitled to terminate by reason of repudiation or fundamental breach – Whether Vendors unable to rely on notice to complete due to Vendors’ breach – Whether Vendors ready willing and able to complete - HELD: Notice to complete invalid – No repudiation or other breach justifying termination by Vendors – Wrongful termination by Vendors itself constituted repudiation. - TIME, WEIGHTS AND MEASURES – Particular words and expressions – Completion date defined as the day “12 months after the date of this contract” – meaning of that expression – HELD: completion date as defined means the day immediately following the expiration of the period of 12 months commencing with the day following the date of the contract.
LEGISLATION CITED:	Interpretation Act 1987 Land Tax Management Act 1956 (NSW) Strata Titles Act 1973
CATEGORY:	Principal judgment
CASES CITED:	Afovos Shipping Co SA v Pagnan [1982] 1 All ER 449 Angus v Kinraid (1988) ANZ Conv Rep 130 Castle Constructions Pty Ltd v Fekala Pty Ltd (2002) NSW Conv R 56-020 Castle Hill Tyres v Luxspice Pty Limited (1996) 7 BPR 14,959 Codelfa Constructions Pty Limited v State Rail Authority (NSW) (1982) 149 CLR 337 Collingridge v Sontor Pty Limited (1997) 141 FLR 440 Dainford v Yulura (1984) NSW Conv R 55-184 Fekala v Castle Constructions Pty Ltd (2003) NSW Conv R 50-042 Gold Coast Oil Pty Limited v Lee Properties Pty Limited [1985] 1 Qd R 416 Holland v Wiltshire (1950) 90 CLR 409 Jillinda Pty Limited v McCourt [1983] NSW Conv R 55 145 Lester v Garland (1808) 15 Ves 248; 33 ER 748 Lohar Corporation Pty Ltd v Dibu Pty Ltd (1976) 1 BPR 9177 Louinder v Leis (1982) 149 CLR 509 McNally v Waitzer [1981] 1 NSWLR 294 Mitchell v Foster (1840) 12 Ad & E 472 Neeta (Epping) Pty limited v Phillips (1974) 131 CLR 286 New Zealand Shipping Company v Société des Ateliers et Chantiers de France [1919] AC 1 Ogle v Comboyuro Investments Pty Limited (1976) 136 CLR 444 Regina v The Justices of Shropshire (1838) 9 Ad & E 173 Rian Financial Services v Alfred Investments Properties Pty Limited (1988) NSW Conv R 55-400 Robinson v Waddington (1949) 18 LJ QB 250 Shaddick v Dunsford Investments Pty Limited (1993) 6 BPR 13-295 Shepherd v Felt & Textiles (1931) 45 CLR 759 Sindel v Georgiou (1984) 154 CLR 661 Strickland v Grieve (1996) NSW Conv R 55-762; (1995) 7 BPR 14-376 Taylor v Raglan Developments [1981] 2 NSWLR 117 Wilde v Anstee (1999) 48 NSWLR 387 Young v Higgon (1840) 6 M & W 49
TEXTS CITED:	Conveyancing Service New South Wales (at para 10205) Lindgren, Time in the Performance of Contracts (2nd ed) Professor Butt, The Standard Contract for Sales of Land in New South Wales, 2nd Ed Seddon and Ellinghaus, Cheshire and Fifoot’s Law of Contract 9th Aust. Ed at [21.24]
PARTIES:	Philip Charles Proctor (First Plaintiff/Cross Defendant) Philip John Dibben (Second Plaintiff/Cross Defendant)) Jaswant Chahl (First Defendant/Cross Claimant) Loris Chahl (Second Defendant/Cross Claimant) Thari Chahl (Third Defendant/Cross Claimant) Javoan Chahl (Fourth Defendant/Cross Claimant) Akiko Chahl (Fifth Defendant/Cross Claimant)
FILE NUMBER(S):	SC 1183 of 2008
COUNSEL:	Izaz Khan with him Mr G Davidson (Plaintiffs/Cross-Defendants) D Warren (Defendants/Cross-Claimants)
SOLICITORS:	Burgess Lawyers (Plaintiffs)/Cross-Defendants) Thomas Presbury (Defendants/Cross Claimants)

- 36 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

WARD J

WEDNESDAY 26 NOVEMBER 2008

1183/08 PHILIP CHARLES PROCTOR & ANOR V JASWANT CHAHL

Hearing dates: 4 and 5 November 2008.

JUDGMENT

1 In these proceedings the plaintiffs (“Vendors”) have sought declaratory and other relief following the termination on 6 July 2006 of a contract for the sale of land (“Contract”) entered into by them, as vendors, on 20 June 2006 with the defendants (“Purchasers”), as purchasers.

2 The land in question (Lot 141 in DP 716312, Folio Identifier 141/716312), known as 105 Crebert Street, Mayfield (“Bella Vista”) is a property in respect of which there is a heritage listing. At the relevant time it was tenanted and used as a wedding reception or function centre.

3 The Vendors contend that they validly terminated the Contract with the consequence that the deposit paid thereunder was forfeited to them. The Vendors seek orders for damages consequent upon the resale of Bella Vista for a lesser purchase price.

4 The Purchasers deny that the Contract was validly terminated by the Vendors and rely upon the Vendors’ notice of termination as a wrongful repudiation of the Contract, which they have accepted. They seek recovery of the deposit, with interest.

Facts

5 The Contract described the land the subject of the Contract in the alternative as being Lot 1411 in an unregistered plan (a copy of which was attached) being part of Lot 141 in DP 716312, or, if Lot 141 in DP 716312 was not subdivided by the registration of a deposited plan at the completion date, the whole of Lot 141 in DP 716312.

6 It was contemplated at the time of entry into the Contract that the Vendors would lodge with the Council an application to subdivide Lot 141 in accordance with the proposed plan of subdivision attached to the Contract and, subject to approval, would register that plan as a deposited plan.

7 Clause 31.1.3 of the clauses to the Contract provided as follows:

If at the Completion Date, the Plan has not been registered at LPI then the Purchaser agrees that it will proceed with the purchase of the Current Lot [Lot 141] instead of Lot 1411 and pay to the Vendor in addition to the purchase price an additional sum of $200,000.00.

8 Clause 31.1.4 made it clear that the Vendors were not obliged to undertake, promote or complete the proposed application for approval and registration of the plan prior to the completion date:

Nothing in this contract or this provision shall require the Vendor to undertake, promote and/or complete its proposed application for approval and registration of the Plan and the Purchaser shall not make any objection, raise any requisition or claim any compensation as a consequence of the Vendors [sic] failure to take such action nor will it delay its subsequent completion of its purchase of the Current Lot on or before the Completion Date in accordance with this provision.

9 There were provisions in relation to the modification or otherwise of the attached plan of subdivision and registration of a s 88B instrument or related documents. These are not relevant for current purposes.

10 There was some argument by the solicitor for the Vendors (Mr Burgess) as to how the subject matter of the Contract was to be described. It was put to Mr Burgess in cross-examination that the subject matter of the Contract was Lot 1411 but, if the Vendors chose not to proceed with the subdivision, then it was to be Lot 141. Mr Burgess did not accept that characterisation; perhaps because the alternative was not triggered only if the subdivision did not proceed (it would also have been triggered if the subdivision did not proceed by reason of lack of approval from the relevant authority).

11 I find it difficult to see anything ambiguous in the operation of clause 31.1.3. It was clearly expressed in the alternative. It imposed an obligation on the Purchasers as at the completion date to purchase the whole of the land if the plan of subdivision had not been registered by then. There was no obligation on the Vendors to procure registration of the plan.

12 Therefore, clause 31.1.3 provided a mechanism by which, as at the completion date (albeit potentially not until the close of business or the latest time at which registration of a plan of subdivision could occur on that date), one could objectively ascertain what it was that the Purchasers were obliged to acquire.

13 The purchase price (for Lot 1411) as disclosed on the front page of the Contract was $3 million. The deposit paid, which was released to the Vendors, was reduced by agreement between the parties to $75,000. If the Purchasers were obliged to purchase the whole of the land (Lot 141) then the total purchase price was increased to $3.2 million.

14 The completion date was specified in the cover page of the Contract as “12 months after the date of this Contract”.

15 The date of the Contract was 20 June 2006. There is a dispute between the parties as to whether the completion date, as defined in the Contract, was 20 June 2007 (as the Vendors contend) or 21 June 2007 (as the Purchasers contend). No plan of subdivision was registered as at either date and, accordingly, the land to be acquired was Lot 141, for the sum of $3.2 million.

16 The Contract was not completed on 20 June 2007. A notice to complete was issued by the Vendors on 21 June 2007, requiring completion of the Contract on or before 3 pm on 6 July 2007. There was no attendance at the place or time appointed for settlement pursuant to that notice to complete and, by facsimile transmission at 3.35 pm on 6 July 2007, the Vendors terminated the Contract. The Purchasers (perhaps with some alacrity given the evidence of the Purchasers’ acknowledged difficulties in arranging finance as at that date) in turn relied upon what they contended was an invalid act of termination of the Contract on 6 July 2007 as a repudiation by the Vendors of the Contract and notified the Vendors of their acceptance of that repudiation as bringing the Contract to an end.

17 Subsequently, Bella Vista was resold, following a public auction held on 15 August 2007, for the price of $ 2 million to Nisner Corporation Pty Limited (“Nisner”). The sale completed on 7 December 2007. Nisner is a company associated with the then tenant of Bella Vista. The Purchasers have raised issues as to the adequacy of the marketing process carried out in relation to the resale.

18 The Vendors submit that even if the notice to complete was not valid (because the completion date was 21 June 2007 as the Purchasers contend) nevertheless the Contract was validly terminated on 6 July 2007 by their acceptance of the Purchasers’ fundamental breach of the Contract and/or repudiation of the Contract. The conduct or inaction comprising that breach or repudiation was particularised in the Amended Statement of Claim filed (by leave) in court on 4 November 2008 as the Purchasers’ failure to send a transfer in accordance with clause 4 of the Contract; the Purchasers’ inability to complete the Contract on the date fixed by the Contract and by the notice to complete; and the Purchasers’ failure to inspect Bella Vista to check the Vendors’ compliance with their obligations under clause 57 within a reasonable time before the date of completion set by the Contract or by the notice to complete.

19 Clause 57 of the Contract provided that, prior to completion, the Vendors would carry out certain works and that, in the event of a dispute between the parties as to whether the work was completed or as to the quality of the completed work, the dispute would be referred to a building inspector who would determine the dispute as an expert and whose determination would be final and binding on the parties.

20 Clause 57 provided, relevantly, as follows:

57. Vendor's Work
57.1 Prior to completion the vendor will, at their own cost and expense and in a good and workmanlike manner, undertake the following work:-

· Repack the piers that are not bearing under the timber floor frame;

· Re-fix tiles to the first floor verandah which have become loose and/or detached;

· Complete painting to the chimneys;

· Repair the damaged ceiling surface to the "Duke of Gloucester" room;

· Repair the broken joints to the front entry roof surface;

· Repair the leak to the front verandah waist;

· Complete the replacement of all guttering and downpipes;

· Instal [sic] new downpipes to discharge rainwater to stormwater pipes;

57.2 In the event of dispute between the parties in relation to the completion or the quality of completion of the vendor's work, the parties are to refer the dispute for determination by an independent Building Inspector having no less than ten (10) years experience in the industry.

57.3 The parties agree that such Building Inspector shall be acting as an expert and his determination shall be final and binding on the parties.

…

21 There was a factual issue as to whether or not all the work required to be done by the Vendors under clause 57 had been done as at the date fixed for completion either by the Contract or by the notice to complete. Apart from various relatively minor items of work which the Vendors contend (but the Purchasers dispute) were complete, the real issue was as to the last bullet point item in clause 57.1. Some new downpipes were installed but those were not connected to any stormwater pipes, for the reason that there were no stormwater pipes. There is, however, a dispute as to whether, pursuant to clause 57, the Vendors had an obligation to install stormwater pipes so as to enable the connection thereto of new downpipes.

22 The Purchasers contended that the Vendors were precluded from relying upon the 21 June 2007 notice to complete and from terminating the Contract (as they did) because of their alleged breaches of clause 57. The Purchasers further alleged that the Vendors were not ready, willing and able to complete the Contract according to its terms at the time nominated for completion in the notice to complete. In particular, it was asserted that the Vendors’ solicitor was unable, or had made no attempts, to discharge land tax payable on the land and was not in a position to effect adjustments required for GST purposes or otherwise as at the time appointed for settlement to take place.

23 Therefore, whatever else may be the case, the Purchasers said that the Vendors were not in a position validly to terminate the Contract as they purported to do on 6 July 2007.

1. When, properly construed, was the completion date of the Contract?

2. Were the Vendors obliged to notify the Purchasers within a reasonable time prior to completion what land was to be acquired (that being dependent on whether the plan of subdivision had been registered by the completion date) and, if so, was sufficient notification given prior to the completion date?

3. Were the Purchasers otherwise entitled to a reasonable time to complete the Contract after notification of the land to be acquired?

4. If the notice to complete was not valid, were the Vendors nevertheless entitled to terminate the Contract on 6 July 2007 by reason of the Purchasers’ breach and/or repudiation of the Contract?

5. If the notice to complete was otherwise valid, were the Vendors entitled to call for completion (and terminate the Contract as they did) in circumstances where there was a subsisting dispute as to the compliance by the Vendors with clause 57 or, alternatively, if, as a matter of fact, clause 57 had not been complied with by the Vendors as at the time the notice to complete was issued or as at the time for completion?

6. Were the Vendors ready, willing and able to settle in accordance with the terms of the Contract at 3.00 pm on 6 July 2007?

7. If termination by the Vendors was valid and effective to bring the Contract to an end, what is the measure of the Vendors’ damages in all the circumstances?

24 If the first issue is determined in favour of the Purchasers, then strictly speaking the only remaining issue is that identified above as the fourth issue. However, as all issues were argued during the hearing I have addressed each of them in these reasons.

Issue 1 - Completion Date

25 As noted above, completion date was defined on the front page of the Contract as being “12 months after the date of this Contract”.

26 The date of Contract was 20 June 2006. Accordingly, the completion date, as defined, was the date “12 months after 20 June 2006”.

27 Both parties agree that “after” requires 20 June 2006 to be excluded in the calculation of the 12 month period. Therefore, the 12 month period commenced on 21 June 2006.

28 Exclusion of the date of the Contract from the calculations accords with s 36 of the Interpretation Act 1987, since the completion date is clearly to be calculated from a given day (that day being the date of the Contract) and this also accords with numerous authorities (see those cases referred to in argument in Robinson v Waddington (1949) 18 LJ QB 250, especially Regina v The Justices of Shropshire (1838) 9 Ad & E 173; Young v Higgon (1840) 6 M & W 49; Mitchell v Foster (1840) 12 Ad & E 472).

29 The Vendors submit that the 12 month period ends on 20 June 2007, calling in aid by way of analogy the definition provisions in the Interpretation Act which make clear that a calendar month means a period commencing at the beginning of the day of one of the 12 named months and ending immediately before the beginning of the corresponding day of the next named month; and that a calendar year accordingly means the year commencing 1 January and concluding 31 December.

30 The 12 month period “after” 20 June 2006 would ordinarily expire on 20 June 2007, consistent with the way in which a calendar year is calculated.

31 The difference between the parties in effect is whether the completion date is the last day of that 12 month period or the commencement of the first day thereafter, which logically is the start of the next 12 month period.

32 When calculating the time “within” which something has to be done, a party has until the end of the final day to do so (see Priestley JA in Shaddick v Dunsford Investments Pty Limited (1993) 6 BPR 13 295 at 13 301 where a requirement that something be done “within eight weeks” from a Thursday was to be calculated from the Friday with each week ending on the succeeding Thursday). It might be thought that, on that basis, a 12 month period for completion was intended to run through to, and expire, at the end of the last day of that period (20 June 2007).

33 However, the difficulty for the Vendors is that until the commencement of the next 12 month period it cannot be said that the whole of the previous 12 month period (that being the 12 month period commencing from the day after the date of the Contract) has expired.

34 In Strickland v Grieve (1996) NSW Conv R 55-762; (1995) 7 BPR 14, 376, a very similar definition of completion date was considered by Young J (as he then was). There, the completion date was defined as “the date which is 8 weeks after the date of this contract”. There was some dispute in that case as to the date of the contract (which is not in issue here) but for present purposes the case is authority for the proposition that the completion date when such a formulation is used is the first day after the expiry of the relevant (there, eight week) period which commenced the day after the date of the contract.

35 By analogy with the expression “the day after tomorrow” his Honour found that the day eight weeks after the making of the contract would be the day “immediately following the expiry of eight weeks from the making of the contract” (my emphasis).

36 There is obviously merit in the court adopting a consistent approach to such clauses so as to allow certainty in conveyancing practice.

37 The potential for confusion which a definition of completion date (such as that used in the Contract) by reference to a date which is a specified period after the date of the contract is adverted to in the Conveyancing Service New South Wales (at para 10205):

Particular care should be given to the completion date. The best course is to enter a specific date but frequently this is not possible. … Language such as “six months after the date of this Contract” should be avoided due to the ambiguities in such wording.

38 The scope for continuing uncertainty in this regard is perhaps illustrated by his Honour’s comment in Castle Hill Tyres v Luxspice Pty Limited (1996) 7 BPR 14,959, citing Strickland, that:

“… depending on how one construes the provision (cf Strickland v Grieve …) the date on which completion was intended to take place was 21 or 22 September 1995”.

39 If one cannot logically say that there has been a period of time from a particular day or event until the whole of that period of time has elapsed, then it follows that a completion date fixed for a 12 month period after a particular day does not arrive until the first point at which the whole of the 12 month period has come to an end. If so, then the completion date here must be the day immediately following the expiry of the 12 month period.

40 Applying Strickland, the completion date under the Contract therefore was 21 July 2007.

41 Professor Butt in The Standard Contract for Sale of Land in New South Wales 2nd edition (para 1.21) notes that, in the absence of express provision or established commercial convention, the time for doing something does not expire until midnight of the relevant day, citing, amongst others, Afovos Shipping Co SA v Pagnan [1982] 1 All ER 449 and Lester v Garland (1808) 15 Ves 248; 33 ER 748. In other words it would not be until midnight on 21 June 2007, on this analysis, that any party would be in breach of the obligation to complete and, hence, the first day on which a notice to complete could issue would be 22 June 2007.

42 Accordingly, the notice to complete served on 21 July 2007, based as it was on the alleged failure of the Purchasers to complete by the (incorrectly stated) completion date, was invalid.

and

Issue 3 - Were the Purchasers otherwise entitled to a reasonable time for completion?

43 The view I have reached on the first issue strictly speaking makes it unnecessary for me to consider the second and third issues.

44 However, for completeness, I note that it was contended by the Purchasers that there was an implied obligation on the Vendors to notify them within a reasonable time before the completion date precisely what land they were obliged to acquire where, as here, that depended on matters within the Vendors’ own knowledge; and that the Vendors did not do so and were therefore precluded from relying on the notice to complete even if it were otherwise valid and effective.

45 If there was such an implied obligation, it would arguably be inconsistent with the express terms of the Contract, which contemplated that registration might take place right up until the date of completion but that completion was still required on that date and which provided that the Purchasers could not delay completion because of matters relating to the subdivision.

46 In that regard, the facts of this case are not dissimilar to those in Wilde v Anstee (1999) 48 NSWLR 387. There, the vendor was required to ensure “prior to completion” (but not at any specified time before completion) that the boundary of the property was adjacent to and contiguous with the boundary of a waterfront lease area. Austin J held that the special condition in question did not contain an implied term that contiguous title be obtained at a reasonable time before the date fixed for completion.

47 Similarly, I do not believe it could be said that there was an implied term that subdivision would take effect within a reasonable time prior to the completion date because the Contract itself contemplated that subdivision might occur up until the completion date.

48 Was there an implied obligation nevertheless to notify the Purchasers of the status of the proposed subdivision at any particular time? I do not accept that as a matter of business efficacy of the Contract such a term would need to be implied. It was always open to the Purchasers to make relevant enquiries in advance of the completion date in order to ascertain and prepare for whatever might be the likely eventuality. To paraphrase the position in Wilde v Anstee it would seem that the parties would on the face of the Contract be said to have accepted that the purchasers would not need any additional time to finalise arrangements for settlement even if they only ascertained (or were notified) the position in relation to subdivision at the close of business on the completion date.

49 Accordingly, had it arisen I would have found against the Purchasers on the second issue.

50 That said, whether the Vendors could insist upon completion on the completion date, and issue a notice to complete immediately thereafter if completion did not occur on that day, if they had not first given reasonable notice of the land to be acquired is a more difficult question.

51 Ordinarily, once the date for completion has passed, a notice to complete may (subject to the notice giver not itself being in default of its relevant obligations under the Contract and being ready, willing and able to complete, as discussed below) be given – Louinder v Leis (1982) 149 CLR 509.

52 However, as pointed out by Mason J in Louinder v Leis, before a notice to complete can be validly given (in a case where the contract stipulates a completion date), not only must the intended recipient of the notice be in breach by failing to complete on the stipulated date, or guilty of unreasonable delay, but also the party giving the notice must be free of default, or breach or antecedent relevant delay (my emphasis); there citing Neeta (Epping) Pty limited v Phillips (1974) 131 CLR 286.

53 I was referred to Wilde v Anstee in this regard. There, as noted above, Austin J rejected the contention that there was an implied term in the Contract that the plaintiff would not require completion until a reasonable time had elapsed after the plaintiff had notified the defendant of the registration of the plan in question. However, his Honour also noted that, for the purposes of specific performance and other discretionary remedies, equity will not regard a notice to complete as effective unless a reasonable time has elapsed after the Vendors have made good their title.

54 Reference was made to Jillinda Pty Limited v McCourt [1983] NSW Conv R 55 145 where, on the true construction of the contract for sale, McLelland J held that the purchaser’s obligation to complete on 19 February was conditional on the vendor having furnished a certificate (pursuant to s 70(1)(c) of the Strata Titles Act 1973 (now repealed)) within not less than seven days before that date. The Vendor was in default because it did not furnish the certificate until 18 February and his Honour held that the vendor’s delay in performance of that obligation remained relevant to the relative situation of the parties in respect of completion at the time when the notice to complete was given on 22 February. His Honour concluded that the notice to complete was invalid both because there had been no relevant default by the purchaser and because the vendor’s previous delay remained relevant to prevent the issue of a notice at that stage.

55 In Wilde v Anstee his Honour distinguished Jillinda because his Honour considered that the contract in Wilde did not require the boundary adjustment to occur at any specified time prior to completion but simply “prior to completion” and it could not be said that special condition 6 contained an implied term that required contiguous title to be obtained at a reasonable time before the date fixed for completion.

56 In Castle Hill Tyres, Young J had referred to cases (of which he said New Zealand Shipping Company v Société des Ateliers et Chantiers de France [1919] AC 1 is the archetype), which made it clear that a clause allowing service of a notice to complete can only be relied on by parties who are innocent of default which brought about the non-occurrence of the relevant event and had said that to permit a notice merely to be given because the completion date has passed would go against that rule. Twenty-four hours after satisfaction of the relevant condition (registration of the lease) was found not to be a reasonable time for settlement. His Honour considered that at least some seven to 14 days should have been given to enable the purchaser to arrange for the financial institution which was assisting it to get the paperwork together to allow for completion.

57 In Castle Hill Tyres his Honour said that generally speaking 14 days was the norm and if a notice to complete was to allow less than 14 days there must be some special matter that could be pointed to as to why that was reasonable.

The adequacy of time of a notice to complete must depend on all the circumstances of the case. Especially one must remember the purpose of a notice to complete, that is, to limit the time beyond which Equity will no longer assist the party allegedly in default to obtain specific performance.

58 Austin J in Wilde v Anstee, rejected a submission, put by analogy with Castle Hill Tyres, that the defendant was entitled to reasonable notice to enable him to “get the paperwork together” for completion after registration of the deposited plan. Austin J considered that the relevant entitlements of the parties were governed by the express terms of the Contract under which the first defendant had agreed to complete on 19 December if at any time prior to that date the Vendor complied with special condition 6 and said (at [34]) that:

By entering into a contract in those terms, the first defendant agreed, in effect, that he would not need any additional time to ‘get the paperwork together’ if special condition 6 was complied with at the last minute. Given the speed of searching the computerised land titles register, that is not an unreasonable or surprising agreement to make.

59 Here, was there “antecedent relevant delay” so as to preclude the Vendors giving a notice to complete unless a reasonable time had been allowed for the preparation of settlement documentation? The “delay” of which complaint was made was not delay in making good the Vendors’ title, nor did it relate to the satisfaction by the Vendors of any condition to which the sale was subject.

60 It is difficult not to see this as a case (similar to Wilde v Anstee) in which the parties should be taken to have agreed, in effect, that they would not need any additional time to complete even if registration of the plan of subdivision occurred at the last minuted.

61 Nevertheless, I note that Austin J appeared to draw comfort, in reaching that conclusion, from the fact that what remained to be done (once the vendor had made good its title) in that case could be achieved fairly quickly.

62 Here, once it became clear what land was to be acquired a number of matters (such as upstamping the Contract and the transfer) had to be finalised, the time for doing which would not have been as speedy.

63 Therefore, had it been necessary to decide this issue I would have been inclined to hold that, notwithstanding the express provisions of the Contract in relation to completion and the issue of a notice to complete, the Vendors could not, in equity, rely upon such a notice if reasonable notice had not been given in advance of the land to be acquired.

64 Were the Purchasers notified in advance of the completion date as to the status of the plan of subdivision and, if so, when?

65 There was a factual dispute in this regard as between the respective parties’ solicitors.

66 Mr Burgess, the solicitor for the Vendors, gave evidence that, in a telephone conversation on 8 June (of which he made no relevant note), he informed Mr Presbury, the solicitor for the Purchasers, that the plan of subdivision was not going ahead. However, the first time that an assertion of that kind was made by him was in a supplementary affidavit filed by Mr Burgess in these proceedings.

67 Neither solicitor’s file note of the conversation is lengthy and it is fair to say that neither note purports to record a complete version of the conversation.

68 Mr Burgess is a solicitor of some 25 years’ experience. He would be expected, I think, to realise the importance of keeping a note of any communication of significance in property transactions. Mr Burgess’ evidence was that he did not see this as being necessarily of importance, from which I would conclude that any reference by him in that conversation to the status of subdivision can only have been a passing or casual reference, the significance of which may or may not have been appreciated by Mr Presbury. Mr Burgess said that he did not expect there would be any necessity to confirm this in writing.

69 Mr Presbury, who struck me as being careful and precise in his answers in cross-examination and has 40 years’ experience as a conveyancer, similarly made a note of his conversation with Mr Burgess but again made no note of any such notification.

70 I would have expected Mr Presbury to have included a note had he been informed that the land was not being subdivided, since it would surely have been apparent to him that his clients would in those circumstances be obliged to purchase the whole of the land and he could be expected to advise his clients accordingly. There was no evidence that he did so.

71 It may well be that Mr Burgess simply did not see this communication as being of any importance at the time and therefore did not record it in his contemporaneous file note or in his first affidavit but, if so, then the lack of a note by Mr Presbury suggests that the significance of any such communication also escaped Mr Presbury at the time. I do not suggest that either solicitor was dishonest in the giving of his evidence in this regard, but I find it unlikely that Mr Presbury would not have appreciated the significance of there being no subdivision had he been told that, whether in an informal conversation or otherwise.

72 On the balance of probabilities I cannot be satisfied that there was an oral notification on 8 June to the effect now attested to by Mr Burgess. I place no weight on the fact that Mr Burgess’ written communications around that time still referred in the header to the sale of “Part Lot 141”. I accept it is likely that this was just a typographical error flowing from use by his secretary of a standard file reference or template.

73 However, I do place weight on the fact that neither solicitor has any contemporaneous written note of a communication to that effect. Had Mr Presbury been made aware at the time as to the identity of the land which was to be acquired then I think it reasonable to assume that at the very least he would have notified his client that the sale was to be of the whole of the land. It does not appear that he did so or that he took any step to prepare a transfer in that regard until after the notice to complete (which clearly identified the subject land) was served.

74 There was some evidence of a valuation for mortgage purposes having been commissioned by the Purchasers on about 20 June 2007 which covered the whole of Lot 141. However, that valuation was commissioned directly by the Purchasers (not Mr Presbury) and would equally be consistent with them preparing for the possibility that they would have to acquire the whole of the lot (rather than having been notified to that effect).

75 Therefore as a matter of fact I cannot form the necessary degree of confidence to make a finding of fact that notification took place on 8 June 2007.

76 The Purchasers say that they were entitled to written notification of any matters of which notice was required under the Contract. In any event, the Purchasers contend that there would not have been reasonable notice for them to prepare the transfer even if the 8 June conversation was as the Vendors contend or if proper (written) notice to perform had otherwise been given at that stage. The Purchasers rely upon Sindel v Georgiou (1984) 154 CLR 661, where it was said that strong circumstances were necessary for there to be less than 14 days’ notice. There, of course, the notice in question was a notice to complete; not a notice to perform. Here, the Purchasers say that if notification occurred on 8 June they had in effect only 12 days’ notice to prepare the transfer, sign, stamp and submit the unstamped Contract; and obtain finance for the extra money.

77 In relation to the administrative matters, the time allowed (if notification had been given on 8 June) would seem to me to have been reasonable and Counsel for the Purchasers conceded that perhaps three to four days would have been as long as it would have taken to carry out these tasks. In relation to the arranging of additional finance, the Purchasers were on notice since the commencement of the Contract that they were potentially liable to complete the purchase of the whole of Lot 141 and to pay an extra $200,000 and might be expected to have commenced making arrangements for finance at a much earlier time. It would seem from the evidence that attempts to arrange finance were still being made on 20 June 2007 (only a day before the date of completion on the Purchasers’ calculations), when a mortgage valuation for the whole of the property was sought.

78 In those circumstances, I am not satisfied that 12 days’ notice would not have been a reasonable time had notification then been given that the purchase price was to be for an additional $200,000.

79 However, as I have been unable to find that there was notification prior to 21 June 2007, I would have been of the view (had this issue required determination), that a notice to complete (which was otherwise valid) served on that date could not be relied upon by the Vendors.

Issue 4 - Repudiation

80 The Vendors say that, in any event, they were entitled to terminate for repudiation by the Purchasers at common law of the Contract and that they did so.

81 There is no need for a notice to complete to be issued before termination where there has been a repudiation by a party of its obligations under the contract (see Professor Butt, The Standard Contract for Sales of Land in New South Wales, 2nd Ed, para 15.4A footnote 215, citing by way of example Gold Coast Oil Pty Limited v Lee Properties Pty Limited [1985] 1 Qd R 416 at 420; Angus v Kinraid (1988) ANZ Conv Rep 130).

82 However, repudiation is by no means easy to establish at common law. I was referred to the judgment in Laurinda v Capalaba where repudiation was established from accumulation of the purchaser’s actions both before and after the service of an invalid notice to complete. The Vendors also relied upon Ogle v Comboyuro Investments Pty Limited (1976) 136 CLR 444 at 450.

83 In particular, Vendors relied on one or more of the following as constituting repudiation:

(i) Failure to settle on the due date (and lack of finance);
(ii) Failure to send the transfer in breach of s 4;
(iii) Failure to inspect within a reasonable time of completion, indicating an inability or unwillingness to complete, coupled with raising trivial matters in relation to the fulfilment of clause 57.

(i) Failure to settle on the due date

84 This is dealt with partly above. Given the view I have formed as to the specified completion date, there can be no repudiation arising out of a failure to settle on 20 June 2007. Moreover, the completion date itself had not been made of the essence, so breach of the obligation to complete on 21 June 2007 (even assuming that was not caused or excused by breach on the part of the Vendors) would not evince an intention by the Purchasers not to be bound by or honour the Contract.

85 As to the assertion as to lack of finance, while a party can terminate without prior notice to complete if it can prove that the other party would have been unable to comply with the notice allowing reasonable time to complete (Rian Financial Services v Alfred Investments Properties Pty Limited (1988) NSW Conv R 55 400 at 57 699), the evidence does not enable a finding that performance of the Contract would have been impossible.

86 There is no doubt that the Purchasers, through their solicitors, had communicated to the Vendors problems in relation to arranging finance by 20 or 21 June 2007. The solicitor for the Purchasers, Mr Presbury, admitted candidly in the witness box that the Purchasers did not have the finance to complete on the completion date or, indeed, at any time.

87 However, as at 20 June 2007 the Purchasers were still taking active steps to obtain finance and it cannot be said that it would have been impossible for them to procure finance had the Contract not been terminated on 6 July 2007.

88 The statement contained in Mr Presbury’s letter dated 6 July 2007 (to the effect that it appeared settlement was not feasible that day) is equally referable to the then dispute as to compliance by the Vendors with clause 57. At no time did the Purchasers evince an unequivocal intention not to complete the Contract.

(ii) Failure to send a transfer

89 Professor Butt (para 4.15) recognises the possibility that the purchaser’s conduct in failing to serve a form of transfer, when viewed in the context of the purchaser’s conduct as a whole, may evince an intention entirely to repudiate the contract, citing Neeta, (but noting that repudiation is rarely to be found in contracts for sale of land). Where the purchaser’s failure to send a form of transfer would be a breach, but that obligation would not necessarily be of the essence, Professor Butt suggests that the vendor should first issue a notice to perform.

90 The Purchasers say that they were not obliged to send a transfer until they knew what property they were purchasing; that there was an implied obligation on the part of the Vendors to notify them accordingly; and that they were entitled to reasonable time after they were so notified in order to submit the transfer. The Purchasers say that it was not until they knew which of the two alternative lots they were in fact obliged to purchase that they were able to finalise arrangements for the purchase; including, as would have been necessary in the circumstances, upstamping the Contract and the transfer; and arranging additional finance for the additional purchase price. I have considered those matters above.

91 The failure of the Purchasers to send the transfer until shortly before the completion date nominated in the notice to complete does not seem to me to evince an intention not to be bound by the Contract. The fact is that, when the Vendors pressed for a transfer, one was prepared and sent under cover of a letter dated 4 July 2008. Moreover, the Purchasers rely upon Fekala v Castle Constructions Pty Ltd (2003) NSW Conv R 50-042, per Hodgson JA at 58,597 (and, at first instance, Windeyer J in Castle Constructions Pty Ltd v Fekala Pty Ltd (2002) NSW Conv R 56-020 at 58,379) as authority for the proposition that, by issuing a Notice to Complete without stating that compliance with clause 4.1 was required, the Vendors waived the requirement for submission by the Purchasers of a transfer.

(iii) Failure to inspect/raising of allegedly trivial issues re Special Condition 57.1

92 There was no express obligation on the part of the Purchasers to inspect the land prior to completion. Failure to inspect until shortly before settlement does not, in my view, amount to repudiation, whether alone or in combination with the other matters raised by the Vendors. It was Mr Presbury’s evidence, which I accept, that it was Mr Presbury’s practice to carry out such an inspection shortly before completion. This is logical; since it is only as at the completion date that the works must be complete.

93 Further, while some of the matters raised may well have been characterised as trivial, the dispute as to stormwater pipe connections was clearly not so, and, the Purchasers were entitled to raise issues with the works if there was a bona fide basis to do so. The evidence was that they did so on the basis of advice from an independent building consultant.

Conclusion as to repudiation

94 Taking all the conduct particularised by the Vendors into account, I am not satisfied that the Purchasers repudiated or renounced the Contract.

95 It is clear that if a party wrongfully terminates for non-compliance with a notice to complete (because the notice to complete is invalid) that conduct of itself can constitute repudiation, see Collingridge v Sontor Pty Limited (1997) 141 FLR 440.

96 It follows that the Vendors themselves repudiated the Contract on 6 July 2007 and the Purchasers were entitled to, and did, accept that repudiation and thereby brought the Contract to an end.

Issue 5 - Even if there had been a repudiation by the Purchasers, was there an affirmation by the Vendors of the Contract such that the right to terminate the Contract was lost?

97 In view of my findings on the fourth issue, this question does not arise.

98 A notice to complete given following one party’s repudiation does not necessarily constitute an election by the giver of the notice never to accept repudiation. The Vendors relied on Holland v Wiltshire (1950) 90 CLR 409 as authority for the proposition that such a notice does no more than evince an intention to treat the contract as subsisting but only for the period up until the time stipulated for completion in the notice and that it is conditional on compliance with the notice.

99 If, as I have found here, the notice to complete is invalid but (which I have not found) the notice giver would otherwise be entitled to terminate for the recipient’s repudiation, the mere giving of the notice does not preclude termination for repudiation (see Taylor v Raglan Developments [1981] 2 NSWLR 117 at 134 and Professor Butt, para 15.50 and cases cited in footnote 221 including Holland v Wiltshire).

100 Therefore, if I had found repudiation then the service by the Vendors of the invalid notice to complete would not of itself preclude later reliance on repudiation.

101 The notice of 6 July was predicated on a failure to complete not a repudiation per se. Where a party has purported to terminate upon an invalid ground, that termination will not necessarily be ineffective if a separate (valid) ground does exist (Shepherd v Felt & Textiles (1931) 45 CLR 759). Therefore, had I been satisfied that the Purchasers had repudiated or renounced the Contract by 6 July 2007, (and subject to any issue which might arise by reason of the Vendors’ possible awareness of and non-reliance upon a ground of termination; see Seddon and Ellinghaus, Cheshire and Fifoot’s Law of Contract 9th Aust. Ed at [21.24]) I would have considered the Vendors’ communication on that date as effective acceptance of the Purchasers’ repudiation.

Issue 6 - Were the Vendors unable due to their own default to rely on any otherwise valid notice to complete?

102 The second of the requirements for a valid notice to complete is that the giver must be free of relevant default. The nature of a breach which disentitles the issuer of notice to complete is one which is relevant to or connected with the securing of completion (Neeta). In Collingridge v Sontor it was said that a party’s breach disentitles that party from giving a notice to complete only where it goes to time or to completion.

103 I was referred also to Lindgren, Time in the Performance of Contracts (2nd ed) for the proposition that a party’s breach will not preclude that party from giving a valid notice to complete where it has ceased to be of any operative effect in the progress towards completion or cannot reasonably be said to be the cause of the other party’s failure to complete.

104 The Purchasers contended that breach of the Vendor’s obligation under clause 4.2 of the Contract to provide information needed for the form of the transfer in relation to the identity of the property to be purchased was a default which went to their inability to comply with the notice to complete within time, because otherwise they could not practically achieve the steps necessary for completion by the completion date. So, for example, it was submitted that, as a practical matter, it is unlikely that the Land Titles Office would accept the stamping of two transfers.

105 However, given the deemed waiver of the Purchasers’ obligation to provide a transfer (arising from issue of the Notice to Complete) I am not satisfied that this is a relevant breach. In those circumstances, however, the Vendors would be obliged to prepare their own transfer (and they did so).

106 The Purchasers also relied in this context on the alleged breach of clause 57 (principally the failure to connect new downpipes to stormwater pipes) and the alleged failure of the Vendors to refer the dispute between them as to this matter for determination in accordance with that clause.

107 The evidence before me from various builders suggested that any breach of clause 57 (other than in relation to the stormwater pipes) was not substantial and was more likely than not to have been cured by the completion date or by the dated fixed for completion in the notice to complete.

108 The real dispute was as to that last bullet point item. There were no stormwater pipes. Therefore, insofar as the requirement to install new downpipes to provide for discharge to stormwater pipes is concerned, the Purchasers say the Vendors were obliged first to install stormwater pipes.

109 I was taken to pre-contractual documents which it was said would assist in the construction of this clause. In particular, it was said that the pre-contractual communications showed the importance attached by the Purchasers to (and acceptance by the Vendors of) the requirement that this work be done. However, pre-contractual negotiations and evidence of a party’s subjective interests are inadmissible in construing a contract, even if there is ambiguity (Codelfa Constructions Pty Limited v State Rail Authority (NSW) (1982) 149 CLR 337). There is no claim here for misrepresentation or for rectification. I do not consider that regard can properly be had to that material for the purposes of construing this clause.

110 If the parties had intended that there be an obligation to install stormwater pipes, the Contract could easily have been drafted to have so provided. The Contract did not do so in express terms and I do not consider there is a basis on which to imply such an obligation. There is still some operation that can be accorded to this last bullet point without the need to imply such an obligation. For example, that bullet point would oblige the Vendors to install new downpipes and probably also to ensure that they be capable of connection to any future stormwater pipes. Nevertheless, if there are no stormwater pipes to which the drainage downpipes can presently be connected then, logically, there can be no breach by reason of a failure to do so.

111 The next alleged breach was the failure to refer (what was acknowledged to be) a dispute between the parties for determination under clause 57. The Contract places an obligation on both parties in that regard and there was equally no referral by the Purchasers of the dispute for determination. I do not accept that any such breach would ordinarily disentitle the Vendors from issuing a notice to complete (since a claim for damages would still be preserved even if it were later found that there had been a breach of the obligation to carry out the works prior to completion). It is arguable that in some cases a breach of that kind might go to completion; for example where completion was conditional upon those (since until a dispute in relation thereto was determined, it may be impossible for a party to know if it was obliged to complete). However, clause 57.1 does not make completion conditional on this work being done and, on balance, where neither party chose to invoke the procedure for determination of disputes in my view it would not have been a disentitling factor.

112 Therefore had it been necessary to determine this issue I would not have found that the Vendors were precluded, by reason of the alleged breaches, from relying on the notice to complete.

Issue 7 - Was the Vendor ready, willing and able to complete?

113 The third requirement for a valid notice to complete is that the vendor be ready, willing and able to complete. This is a matter of fact.

114 Here, the evidence showed that as at the time fixed for completion the Vendors had no cheque for 1/11th of the purchase price (as the Purchasers contend was required pursuant to standard condition 13.9); had not made arrangements for any adjustments in favour of the Purchasers; and, most relevantly, had not made arrangements in relation to land tax.

115 Pursuant to clause 13.9, the Vendors were obliged to pay to the Purchasers on completion 1/11th of the purchase price if, first, the Contract stated that the sale was a taxable supply and did not say that the margin scheme applied to the property, and, secondly, if either the sale was not a taxable supply or the margin scheme applied to the property.

116 The Contract clearly stated that the sale was a taxable supply.

117 By reference to the fact that no box was ticked in respect of the relevant item of GST information on page 2 of the standard form of contract, it also stated the margin scheme did not apply. Therefore for the purposes of standard condition 13.9, the Contract did not say the margin scheme applied to the property.

118 Therefore the first limb of clause 13.9 was satisfied. Nevertheless, before any obligation to pay the 1/11th sum arises, either 13.9.1 or 13.92.2 must apply. It was submitted for the Purchasers, in effect, that even if the wrong box had been ticked on the cover page in relation to the margin scheme, nevertheless it was for the Vendors on settlement to pay the 1/11th sum because there was a promise in special condition 13.6 that the margin scheme did apply.

119 The Purchasers pointed out that no claim for rectification of the Contract in this regard had been made. It did not seem to me that this was a particularly meritorious submission if, as I apprehend is the case, the reality is that as a matter of law the margin scheme did not apply to this sale and the wrong box had been ticked.

120 In any event, clause 13.6 does not in its terms say that the margin scheme applies. It merely promises that if (which the Contract does not) the Contract says the margin scheme applies then the Vendors promise it will apply. Nowhere in the Contract does it say the margin scheme applies. Nor was there evidence that the margin scheme did apply.

121 The Purchasers also rely on clause 13.10 which obliges the Vendors to give the Purchasers a tax invoice for any taxable supply by the Vendors by or under the Contract and say that if clause 13.9 did not apply there was a requirement to hand over a tax invoice on settlement. No such tax invoice was available at settlement.

122 I note, in this regard, that in Lohar Corporation Pty Ltd v Dibu Pty Ltd (1976) 1 BPR 9177 Hutley JA considered that there, where the appellant’s solicitor had already received notice that there was to be no settlement (because the respondent had not obtained the money to settle) the appellant was justified “in not going through the laborious and expensive processes involved in an abortive settlement”. There, however, there seemed to have been a more definitive statement of inability to complete than in this case where the Purchasers’ solicitor had simply stated that settlement on 6 July did not appear to be feasible.

123 Therefore, while I am inclined to the view that the fact that a tax invoice had not been prepared before settlement would not be decisive, there is some doubt as to the Vendors’ readiness to settlement in that regard.

124 The real difficulty in relation to the Vendors’ readiness to complete on 6 July 2007 is in relation to the land tax.

125 Austin J gave a comprehensive analysis of the land tax provisions and their effect in this context in Wilde v Anstee. Reference was made by Austin J to the requirement that the giver of a notice must be ready, willing and able to proceed to completion (as stated by Dankwerts J in Re Barr Contract [1956] Ch 551 at 556; this being the third of the requirements listed by Professor Butt for a valid notice to complete). The link between this requirement and the traditional equity pleading in a suit for specific performance was referred to by Austin J, citing McNally v Waitzer [1981] 1 NSWLR 294 per Reynolds JA at 296 and Hutley JA at 303.

126 In McNally, the obligation on the Vendor to remove the charge for land tax (which arises pursuant to s 47 of the Land Tax Management Act 1956 (NSW) was said to be an obligation which arises on completion. Hutley JA said (at 303-304):

The vendor has to get rid of the charge for land tax, but only at the latest on completion and there is no objection to him giving a valid and effective notice to complete if at the time he gives it the property is still subject to land tax. … The correct rule, in my opinion, is simply that a vendor who is in default in respect of things which up until then should have been done cannot give a notice to complete, but he can give notice to complete prior to performing all those other things which he has to perform in order to complete the contract. The vendor does not have to satisfy the purchaser prior to completion that the land is not subject to a charge for land tax. He has, at the most on completion, to provide satisfactory evidence to the purchaser that either the land is not subject to land tax, or, if it is, that liability has been discharged in the course of completion itself.

127 The difficulty for the Vendors here, is that, in the absence of a certificate available on completion that the land tax had been cleared or the arrangements for completion being such as to enable land tax to be cleared at settlement, on an application of the principles outlined in Wilde v Anstee it could not be said that the Vendors were ready, willing and able to complete in accordance with the Contract at the time specified in the Vendors’ notice to complete.

128 It was said that the Vendors would have been prepared to offer an undertaking on completion and that this was in accord with normal conveyancing practice. However, in Dainford v Yulura (1984) NSW Conv R 55-184, Rath J held that, when land was subject to a land tax charge but the amount of tax had not been assessed, the purchaser was not required to accept at completion the vendor’s undertaking to pay the land tax when assessed. That holding was not affected by the matter on appeal, since there the parties assumed that the vendor was obliged to have land tax removed as at settlement by payment of the assessed tax and not having done so was not able to settle.

129 Austin J made it clear in Wilde v Anstee that in his view the vendor’s obligation to give good title on completion would be discharged if, on completion, the purchaser and persons acquiring interest under the purchaser had protection conferred by s 47(1c) by virtue of the issue at or prior to completion of a certificate that no land tax is charged on the land procured by release and payment of an amount estimated by the Office of State Revenue. However, no such procedure was invoked by the Vendors in this case.

130 Austin J considered the question whether the law required that the vendor must put in place arrangements with the Office of Statement Revenue for the issue of a clear certificate on completion before the notice to complete was served, or whether it was sufficient that those arrangements were made and notified to the Purchaser in time for completion on the day on which the notice fixed for completion. Austin J considered that the notice to complete would be ineffective unless it was true, on the facts that existed at the time when the notice was given, that the Vendor was able to make arrangements with the Office of State Revenue for the issue of the clear certificate and was ready, willing and able to do so. His Honour considered that perhaps notice would be effective if the evidence showed that the Office of State Revenue had adopted the practice of releasing land on payment of an estimated amount routinely or in normal circumstances. His Honour said (at [54]):

But where there is a real doubt at the time of service of the notice as to whether the Vendor is in a position to obtain the land tax clearance by the date for completion as stated in the notice, the Vendor is not able, ready and willing to proceed to completion and conversely the Purchaser cannot be said to have defaulted by not completing at the Contractual time for completion.

131 Whether or not, as at the time the notice to complete was issued in this case – 21 June 2007 - the evidence would have supported such a conclusion as to the Office of State Revenue’s practice is not necessary for me to determine at this stage. Here, it does not appear that any such arrangement had been made.

132 The Vendors cannot, in my opinion, rely upon an assumption that the Purchasers would have accepted an undertaking on completion whatever may be the standard conveyancing practice in that regard. It would have been open to the Purchasers to rely upon their strict legal rights and refuse to accept an undertaking on completion.

133 Accordingly, by reason of the position in relation to land tax, the Vendors were not in a position to give title clear of any charge for land tax and hence were not in a position to complete.

Damages

134 I should note that there was, finally, an issue as to whether or not any, and if so what, damages could be recovered. It was asserted that there was no basis on which to ascertain the appropriate damages because it was said that the evidence of resale was unreliable (given the criticisms made by the Purchaser of the marketing process).

135 The valuation expert relied upon by the Vendors, Mr Rich, in his report suggested that the requisite time for marketing was three to six months. It is accepted that there was no marketing period of that length in this case. However, in cross-examination the expert explained that what he meant by this was that this was how long, in his experience, it was likely to take to sell a property of that kind. He said that in the ordinary course the commencement of the process by way of an auction (as happened here) would be the way in which to proceed.

136 It was accepted that this was a heritage listed property for which there would be a limited range of purchasers. I am not prepared on the evidence to make a finding that the marketing of the property was inadequate or that the purchase price obtained for the property was below market value.

137 In particular I note that the sole difference between the valuers in this regard was whether or not any value could properly be put on the so called “additional” land being land which Mr Simm (for the Purchasers) assumed could be used to generate further revenue on the basis that there had been an earlier DA which had provided for the building of town houses on the site. The valuation methodology was otherwise accepted by both valuers as being the same and they achieved a similar value for the main property at $2 million. I am not satisfied that a value could properly be placed on the additional land in light of the constraints in relation to the development of heritage land. Mr Simm seemed to base his conclusion in this regard on an assumption drawn from an expired development application.

138 Therefore, other than some adjustments which would have to be made in the Purchasers’ favour (in relation to agents’ commission – which would have been less on the resale – and legal costs of the mortgage which could not have been recouped), had the Vendors otherwise succeeded I would have been prepared to fix damages at the difference in the purchase price on resale.

Conclusion

139 I find that the notice to complete issued on 21 June 2007 was not valid and effective. It was issued prior to the Purchasers being in breach of the obligation to complete, the completion date as I have found being 21 June 2007.

140 I do not find that there was any repudiation or renunciation by the Purchasers of the Contract or that the Vendors were otherwise entitled to terminate the Contract as they did on 6 July 2007. In any event the Vendors were not ready, willing and able to settle as at the nominated date for completion (6 June 2007), at the very least because they had not procured or made arrangements in relation to the discharge of land tax.

141 Accordingly, the wrongful termination by the Vendors on 6 July 2007 constituted a repudiation by them which it was open to the Purchasers to accept, and they did so. That determines the matter in favour of the Purchasers.

142 I find for the Purchasers and dismiss the Vendors’ claim with costs. I order the repayment by the Vendors to the Purchasers of the deposit, with interest.

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