Provident Capital Limited v Szlasa

[2010] SASCFC 65

SUPREME COURT OF SOUTH AUSTRALIA

(Full Court)

PROVIDENT CAPITAL LIMITED v SZLASA

[2010] SASCFC 65

Judgment of The Full Court

(The Honourable Justice Gray, The Honourable Justice Anderson and The Honourable Justice Kelly)

26 November 2010

CONVEYANCING - BREACH OF CONTRACT FOR SALE AND REMEDIES - ENTITLEMENT TO DEPOSIT - FORFEITURE TO VENDOR

CONTRACTS - GENERAL CONTRACTUAL PRINCIPLES - DISCHARGE, BREACH AND DEFENCES TO ACTION FOR BREACH - REPUDIATION AND NON-PERFORMANCE - REPUDIATION - GENERAL PRINCIPLES

Appeal from judgment following a civil trial in the District Court concerning a contract for the sale and purchase of real property - both parties to the contract asserted that the other had acted in breach of the contract and each claimed the deposit moneys - following trial, deposit moneys paid to purchaser, the respondent to the appeal - contract contained an election clause to substitute first mortgagee and appellant as vendor - time for settlement extended by agreement - purchaser purported to withdraw from agreement to extend time - on vendor's failure to settle on specified time, purchaser provided notice of default and notice of termination - vendor continued to attempt to settle - vendor continued to attempt to effect substitution of vendor - whether withdrawal from agreement effective - whether substitution of vendor effected - whether vendor or purchaser in breach of contract - whether vendor repudiated or abandoned the contract -  whether vendor or purchaser entitled to deposit moneys.

Held:  appeal allowed - deposit should be paid to vendor - purchaser's withdrawal from agreement to extend time ineffective - notices of default and termination issued by purchaser ineffective - contract remained ongoing until vendor effected vendor substitution and made time of the essence - failure of purchaser to settle at this time in breach of contract - no repudiation or abandonment by vendor.

Law of Property Act 1936 (SA) s 7 and s 47, referred to.
Partridge v McIntosh & Sons Ltd (1933) 49 CLR 453; Buhr v Barclays Bank Plc [2001] EWCA Civ 1223; Syme v Commonwealth (1942) 66 CLR 413; Laurinda Pty Ltd v Capalaba Park Shopping Centre Pty Ltd (1989) 166 CLR 623; Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd (2007) 233 CLR 115; DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423; Shevill v Builders Licensing Board (1982) 149 CLR 620; Aclaw Pty Ltd v Fullston [2000] SASC 440, considered.

PROVIDENT CAPITAL LIMITED v SZLASA
[2010] SASCFC 65

Full Court        Gray, Anderson and Kelly JJ

GRAY J.

Introduction

1. This is an appeal from a judgment following a civil trial in the District Court concerning a contract for the sale and purchase of real property.  Both parties to the contract asserted that the other had acted in breach of the contract so as to repudiate the contract and as a consequence, each claimed the deposit moneys.  The Judge concluded that the deposit should be returned to the purchaser. 

2. On 4 June 2008, the plaintiff and respondent, Dorothy Jolanta Szlasa, acting as agent for Andrzej Szlasa and Dorothy Jolanta Szlasa, entered into a contract for the sale and purchase of a residential property at Parkside.  Ms Szlasa paid a deposit of $45,000.00.  The vendor of the property was a company in liquidation, First Pacific Property Development Pty Ltd.  That company was selling the property at the direction of Provident Capital Limited, the defendant and appellant, the holder of a first mortgage over the property.  Provident Capital contended that it had been validly substituted as vendor to the contract. 

3. Provident Capital complained on appeal that the Judge made errors of fact and law that should lead to the setting aside of the judgment and an entry of judgment in its favour. 

4. Before coming to discuss the issues on the appeal, it should be noted that First Pacific has not been joined as a party to the proceedings.  This causes difficulty in formulating the precise terms of an order for the payment or repayment of the deposit moneys in the within proceedings.

   Background

5. To understand the issues on the appeal and to address their resolution, it is necessary to outline the factual background. 

6. On 6 April 2005 First Pacific granted a mortgage to Provident Capital over the Parkside property.  By the terms of the mortgage First Pacific covenanted “for the better securing to the Mortgagee the payment of the monies hereby secured” to mortgage the property to Provident Capital as mortgagee.

7. In the event of default, Provident Capital as mortgagee was permitted by the terms of the mortgage to deal with the property as if Provident Capital owned it, to the extent permitted by law.  This included selling the property as Provident Capital thought fit.  Pursuant to the terms of the mortgage First Pacific irrevocably appointed Provident Capital as attorney to “on your behalf and in the attorney’s name or in your name … [do] anything which, in the opinion of the attorney … you should do … under the law” and, to “use your name to exercise the mortgagee’s powers under … the law or otherwise”.  This power of attorney permitted Provident Capital to enter into the real estate contract dated 4 June 2008 on behalf of First Pacific.

8. The mortgage by its terms recognised that these provisions did not derogate from Provident Capital’s rights at law, including its rights pursuant to the provisions of the Law of Property Act 1936 (SA). As a consequence Provident Capital held a security which, according to the definition of “mortgage” in the Law of Property Act conferred a “charge or lien on … property for securing money or money’s worth”.[1] Provident Capital also had the right of sale described in section 47(1)(a) of the Law of Property Act.[2] 

   [1]    See Law of Property Act 1936 (SA), section 7.

   [2]    See Partridge v McIntosh & Sons Ltd (1933) 49 CLR 453 at 466 where Dixon J explained that a “statutory mortgage does not upon registration effect a transfer to the mortgagee of an estate in the land …. He has, of course, an interest in the land at law, but it is in the nature of a charge”.

9. Provident Capital was entitled to sell the Parkside property in order to recover the moneys First Pacific owed to Provident Capital, and, in connection with a sale, to sign the documents necessary to effect that sale in the name of First Pacific or in the name of Provident Capital.  Provident Capital’s charge extended over the proceeds of sale[3] and it was entitled to have such moneys applied in discharge of the mortgage debt.[4]

   [3]    Buhr v Barclays Bank Plc [2001] EWCA Civ 1223 at [12], [39]-[44] and [50].

   [4]    Syme v Commonwealth (1942) 66 CLR 413 at 430 (Williams J): “…The mortgagee is entitled to have such moneys applied in discharge of the mortgage debt on its due date. They would, therefore, have to be applied in discharge of the mortgage debt if it was then due, or invested until it became due, the mortgagor being entitled to the income until default.” See further the terms of clause 4.5 of the mortgage in the within proceeding relevantly provides: “If the proceeds from the sale of the property are not sufficient to repay the whole of the secured money [the mortgagor remained] liable to the mortgagee for the balance.”

10. By 17 April 2008 First Pacific was in default and Provident Capital, by its solicitor, served a default notice and a notice of intention to exercise its power of sale. 

11. On 4 June 2008 First Pacific by its appointed attorney, Provident Capital, executed the contract for the sale and purchase of the property with Ms Szlasa.  The contract followed a standard form for the sale and purchase of residential property prepared by the Real Estate Institute of South Australia.  For present purposes two clauses in the contract are of particular relevance.  The first relates to the settlement date and the second relates to the right of First Pacific to elect to substitute Provident Capital as vendor.

12. According to the terms of the contract, the vendor was “as described in the schedule to the contract”, which relevantly provided:

    First Pacific Property Development Pty Ltd (in Liquidation) ACN 099 381 941 by its Appointed Attorney Pursuant to a Power of Attorney Granted by the Vendor to Provident Capital Ltd ABN 78 082 735 573 – Vide Memorandum of Mortgage No. 10200936 (and in Particular Clause 4.6 of Memorandum of Common Provisions No. 10048280) …

13. The schedule also provided a further condition concerning the amendment of the description of the vendor:

    At the vendor’s election, the description of the vendor will be amended to “Provident Capital Limited exercising its power of sale under mortgage no 10200936”.  The purchaser may not object to the amendment or delay completion because of the amendment.  If required by the vendor, the purchaser will enter into a new contract reflecting the amended description of the vendor and a completion date the same as the due date for completion under this contract, and otherwise on the same terms as this contract.

14. These conditions in the schedule made it plain to Ms Szlasa that although she was purchasing the property from a company in liquidation, if circumstances required it, First Pacific could be substituted by Provident Capital as the vendor.  One apparent reason for this provision was that there was a second mortgagee to the property and if any difficulty arose in regard to clearing the title for settlement, the sale could be converted to a mortgagee sale, thereby protecting the rights of Provident Capital. 

15. The contract provided for settlement to occur on the settlement date, which was defined to be the date shown in the schedule and fixed by the agreement as the date of settlement.  In that respect, the special conditions provided:

    The Settlement Date [Clause 1.22]

    Q  a. The 23^rd day of July 2008;   or

    £  b. within        days after the date on which the last of the conditions set out in the Schedule has been satisfied;   or

    Q  c. such other date as is mutually agreed, in writing, by the Vendor and Purchaser.

    The contract neither by its terms nor by its special conditions made time of the essence.  However, under the default provisions, the contract provided that notice could be given to complete the purchase, thereby making time of the essence.

16. Following entry into the contract, it became apparent that the second mortgagee would not allow clear title to be transferred.  This led to an exchange of emails between the brokers for the parties. 

17. On 22 July 2008, Ms Szlasa’s broker, by email to First Pacific, requested that settlement be arranged for 11.30am on 23 July 2008.  First Pacific’s broker responded a few minutes later advising that settlement would be delayed, and some hours later formally requested a 14 day extension of time within which to complete the sale.   Ms Szlasa’s broker responded the same day in the following terms:

    I have now confirmed that my client is agreeable to the 14 day extension SUBJECT to him not incurring any penalties from his bank which is not expected, but [my client] is checking and I will advise shortly if this is the case. 

    There was no further advice about any difficulty with Ms Szlasa’s bank.  Accordingly, the contract settlement date was extended by mutual agreement until 6 August 2008.

18. On 25 July 2008, Ms Szlasa’s broker communicated by email to First Pacific’s broker in the following terms:

    Further to my email of 23 July 2008 stating that my client is agreeable to the 14 day extension, I am now instructed to advise you that my client forthwith withdraws the 14 day extension and will today be serving a notice under section 7.2 of the Contract.

    Clause 7 of the contract addressed respective rights of each of the parties in the event of default, and clause 7.2 was directed to default by a vendor. 

19. Later the same day, Ms Szlasa’s broker, by email, forwarded to First Pacific’s broker an unsigned purported notice of default.  This email advised First Pacific that a signed copy of the notice of default had been sent by registered mail that day.  The signed notice was not received by First Pacific until 29 July 2008.  The notice required completion by 11.30am on 1 August 2008. 

20. On 1 August 2008, First Pacific’s broker by email advised as follows:

    We will not be able to attend settlement today on the above property.

    Our client has been trying to obtain a discharge of mortgage from the second mortgagee so that settlement can proceed.

    Our client has had no success and has requested us to invoke other condition clause 8.1 [sic] of the contract to amend the Vendor description on the contract.

    We will prepare a new contract with the Vendor being our client as mortgagee in possession and send it to your office so your client can execute.

21. In the absence of any immediate response, First Pacific further emailed later in the afternoon of 1 August 2008 with the following request: “please urgently advise your clients intention”.  Minutes later, Ms Szlasa’s broker responded advising that the contract was being terminated.  A purported notice of termination was forwarded to First Pacific on 4 August 2008. 

22. In the months following, Ms Szlasa maintained that the contract had been terminated as a consequence of the breach by First Pacific.  She sought the return of her deposit.  First Pacific denied Ms Szlasa’s assertions, claiming that she had acted in breach of contract, that the contract continued and that settlement should take place. 

23. Two unsuccessful attempts were made to amend the description of the vendor to “Provident Capital exercising its power of sale under Mortgage Number 10200936”.  On 13 August 2008 a form of contract in the name of Provident Capital, exercising its power of sale and as mortgagee in possession, was forwarded to Ms Szlasa.  This proposed contract contemplated the mutual termination of the contract of 4 June 2008, otherwise it was essentially in the same terms as that contract.  On 17 August 2008, a further form of contract was forwarded to Ms Szlasa, seeking to invoke the substitution clause a second time.  This proposed contract provided that the vendor, First Pacific, by its appointed attorney, pursuant to a power of attorney, gave notice that it was exercising its rights contained in the special condition, to amend the description of the vendor.  Ms Szlasa declined to accept either of these contracts as being a valid exercise of rights under the special conditions of the contract of 4 June 2008. 

24. On 20 November 2008, a third attempted invocation of the special condition allowing for substitution occurred.  On this occasion, it was asserted that “the original contract remains on foot, except that First Pacific has elected to vary the contract to change the name of the vendor to that of [Provident Capital]”.  A copy of the contract of 4 June 2008 was enclosed, which was in the same terms as the original 4 June contract, save that the vendors name was changed to “Provident Capital Limited exercising its power of sale under Mortgage Number 10200936”.  A notice to complete nominating 4 December 2008 as the new date for settlement was served as required by clause 7 of the 4 June 2008 contract.  This notice made time of the essence. 

25. Ms Szlasa did not settle pursuant to the notice to complete and on 5 December 2008, a notice of termination pursuant to clause 7 of the contract was served and a claim made for the payment of the deposit. 

    The Trial

26. Evidence was called from Ms Szlasa, Andrzej Szlasa and their broker, Dennis Robazza.  The relevant documents evidencing the transaction and later dealings between the parties were tendered. 

27. The Judge considered that the purported termination of the contract by Ms Szlasa on 4 August 2008 was ineffective.  The Judge reasoned that the parties had agreed to extend time for settlement until 6 August 2008 and that Ms Szlasa was bound by that agreement and could not withdraw from it.  Accordingly, there was no basis on which Ms Szlasa was entitled to call for settlement on an earlier date. 

28. On the hearing of the appeal, this conclusion was challenged by Ms Szlasa through a notice of contention.  It is convenient to address this issue immediately.  In the event, although there was no formal concession that the Judge’s conclusion was correct, no basis to challenge that conclusion was identified or advanced.  I would reject the notice of contention.  In my view, the conclusion of the Judge on this topic was plainly correct.  The purported termination by Ms Szlasa was ineffective.  Her attempt to resile from the agreement to extend settlement was ineffective.  It follows that the contract of 4 June 2008 remained on foot at this time.

29. The Judge concluded that First Pacific did not validly exercise its right to have Provident Capital substituted as vendor.  He reasoned that this was a consequence of it not exercising the right while the contract was ongoing.  The Judge further reasoned that in any event, the new or amended contract that was proffered was not in the same terms as the original contract and that as a consequence the attempt to substitute was not in accordance with the contractual right to do so:[5]

    In any event, I have had to deal with the possibility that First Pacific validly exercised the right to have the defendant substituted as vendor.  I have concluded that the defendant never became the vendor for two reasons: first, because, even if it is assumed that First Pacific purported to exercise the right to have the defendant substituted as vendor, it did not do so at a time when the right to do so conferred by the substitution clause existed; and second, even if the right had been in existence, that purported substitution was not effective because the new or amended contract was not in the same terms as the original.  The non-existence of the right to substitute arises from my conclusion that the right could only be exercised before any settlement date could fit by reference to the terms of the contract. 

    The question therefore becomes: did First Pacific effectively exercise its rights under the substitution clause on or before 6 August 2008?  The new or amended contract was not tendered before 6 August 2008 or, if it was, it was not in the same terms as the original contract.  This means that right up to December 2008, First Pacific purported to exercise a right that it did not have.  The new or amended contract never came into force and so there was nothing to terminate.  In that case, no forfeiture of the deposit by either First Pacific or the defendant was possible. 

    [5] Szlasa v Provident Capital Limited [2009] SADC 104 at [55] – [56].

30. The Judge then addressed what was described as repudiation, abandonment or abrogation:[6]

    Alternatively, or in addition, First Pacific had repudiated the original contract as early as August 2008 and it continued in that vein until December.  Equally clearly, the plaintiff, since August 2008, sought to recover the deposit.  She did so for the wrong legal reasons because she had not effectively terminated the original contract in August, but that, in my view, does not matter.  Where effectively neither party was prepared to settle in accordance with the original contract, they must both be taken to have abandoned it, in which event, the plaintiff is entitled to recover the deposit.

    Abandonment or abrogation of a contract was considered by Isaacs J in Summers v The Commonwealth (1918) 25 CLR 144. That case involved the supply of goods but the principle applies to any form of contract. The plaintiff invoked the original jurisdiction of the High Court and the trial was heard by Isaacs J. It was held that, in the circumstances of the case, both parties had abandoned or abrogated the contract. Reference was made to cases involving repudiation arising from the conduct of parties. The case is authority which supports my conclusion that First Pacific repudiated the contract by insisting upon the substitution of the defendant as vendor in circumstances not permitted by the original contract: see also Holland v Wiltshire (1954) 90 CLR 409 of at 420 and DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423. The plaintiff did not rely upon that conduct in the sense that she accepted such a repudiation. However, her conduct, in insisting that she had validly rescinded the contract as early as August 2008 constituted on her part an abandonment or abrogation of the contract.

    Arising from this, there is an additional reason why the plaintiff is entitled to the return of the deposit.  It is that First Pacific never effectively made the election while the original contract was on foot.  In other words, by October 2008, when the final form of the new contract was tendered to the plaintiff, the plaintiff and First Pacific had before then mutually abandoned the original contract by their conduct: by the plaintiff who insisted (wrongly) that she had terminated the original contract and by First Pacific who insisted (wrongly) that the plaintiff act in accordance with a purported election which had no contractual force.

    [6] Szlasa v Provident Capital Limited [2009] SADC 104 at [57] – [59].

1. As earlier observed the Judge concluded that Ms Szlasa was entitled to the return of the deposit. 

   The Appeal

2. Before embarking upon a discussion of the issues arising on the appeal, I refer to my earlier comments concerning my rejection of the notice of contention.  The Judge was correct to conclude that Ms Szlasa’s attempt to terminate the contract on 4 August 2008 was of no effect.

3. Provident Capital contended that the conclusions of the Judge involved errors of fact and law.  It was said that the Judge overlooked the email from First Pacific of 1 August 2008, advising of the intention to substitute.  It was argued that this email itself was an effective exercise of the special condition of the contract.  It was submitted in the alternative that if this contention was incorrect, an effective substitution had occurred on 20 November 2008 at a time when the contract of 4 June 2008 remained on foot.  It was the further submission of Provident Capital that the other attempts of substitution were simply ineffective, but did not affect the validity of the contract of 4 June 2008.  There was, it was said, no repudiation, no abrogation and no abandonment on the part of the vendor.

4. Counsel for Ms Szlasa contended that the conclusions of the Judge were correct, that First Pacific had repudiated the contract or alternatively that it had been abandoned.  He further contended that his client had lawfully terminated the contract and that First Pacific had refused to settle in circumstances that amounted to a repudiation or an abandonment. 

5. In my view, the submission of Provident Capital that the Judge had overlooked the email of 1 August 2008, should be accepted.  The Judge made no reference at all to the email or its terms, in his reasons for judgment.  The email was a critical document in the chronology of events.  It demonstrated that while the contract was undeniably ongoing, First Pacific wished to continue with the contract and to exercise its rights of substitution under the special conditions. 

6. I consider that the contract of 4 June 2008 was not terminated by Ms Szlasa.  I do not consider that there was any evidence of repudiation of the contract by First Pacific.  The first two attempts of First Pacific to substitute Provident Capital did not accord with the special condition allowing substitution.  Ms Szlasa rejected both attempts.  Both attempts were of no effect.  The attempts proceeded on an incorrect view of the terms of the contract.  They did not affect the validity of the contract of 4 June 2008.  The third attempt at substitution on 20 November 2008 was, however, effective.  This substitution was made in strict compliance with the terms of the contract.  On this occasion First Pacific acted in accordance with the special condition, and in particular specified that:

   At the Owner’s election, and in accordance with item S ‘Other Conditions’ contained in the schedule to the contract, the description of the vendor named in the contract has been amended to ‘Provident Capital Limited exercising its power of sale under Mortgage No 10200936’ on 20 November 2008.

7. There was no requirement for Ms Szlasa to enter into a new contract at this time.  It is relevant to note that the Notice to Complete of 20 November 2008 nominated a new date for settlement and recorded that time was of the essence. 

8. It follows from the above analysis that the deposit of $45,000.00 should be paid to Provident Capital.  As the Judge found, Ms Szlasa’s attempted withdrawal on 25 July 2008 from the agreement to extend the date for settlement to 6 August 2008, was ineffective.  As a consequence, the notice of default issued on 25 July 2008 requiring completion of the contract by 1 August 2008 was also invalid and ineffective, as was Ms Szlasa’s attempt to terminate the contract on 4 August 2008.  The contract of 4 June 2008 relevantly remained on foot.  The notice to complete served by Provident Capital on Ms Szlasa on 20 November 2008, making time of the essence and requiring settlement of the contract on 4 December 2008, accorded with the terms of the contract and was validly served.  The substitution of Provident Capital as vendor was thereby effected. When Ms Szlasa failed to settle on 4 December 2008, Ms Szlasa was in breach of the contract of 4 June 2008 and Provident Capital was entitled to terminate the contract by virtue of clause 7.

   Repudiation or Abandonment

9. The remaining question relates to the Judge’s conclusion with respect to repudiation and abandonment.

10. The Judge reasoned that “First Pacific … repudiated the original contract as early as August 2008 and it continued in that vein until December”.[7]  Earlier, as recorded above, the Judge said that “both parties by November 2008 had acted in such a way that they had each abandoned or abrogated the original contract”.[8]

    [7]    Szlasa v Provident Capital Limited [2009] SADC 104 at [57].

    [8]    Szlasa v Provident Capital Limited [2009] SADC 104 at [53], see also [58]-[60].

11. Whether a party has repudiated – or renounced – its contractual obligations is to be determined objectively.[9]  At the very least, Provident Capital always remained “willing to perform the contract according to its tenor”.  As was observed by Stephen, Mason and Jacobs JJ in DTR Nominees:[10]

    … there are other cases in which a party, though asserting a wrong view of a contract because he believes it to be correct, is willing to perform the contract according to its tenor.  He may be willing to recognize his heresy once the true doctrine is enunciated or he may be willing to accept an authoritative exposition of the correct interpretation. …

    [9]    Laurinda Pty Ltd v Capalaba Park Shopping Centre Pty Ltd (1989) 166 CLR 623 at 657-658 (Deane and Dawson JJ); see also Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd (2007) 233 CLR 115 at [47], [56] and [68] (Gleeson CJ, Gummow, Heydon and Crennan JJ).

    [10]   DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423 at 432.

12. Provident Capital consistently demonstrated that it wished to sell the property to Ms Szlasa as evidenced by the repeated invitations to Ms Szlasa to settle, in August, October and November 2008.  The invitation of November 2008 brought the matter to a head with a notice to complete and later a notice of termination.  Provident Capital always wished to proceed with settlement.

13. As has been observed by the High Court, repudiation is a serious matter and will not be “lightly found”.[11]  Absent clear renunciation, or if there are attempts to perform a contract, there is no renunciation.[12]

    [11]   Shevill v Builders Licensing Board (1982) 149 CLR 620 at 633 (Wilson J), citing Ross T. Smyth & Co Ltd v T D Baily, Son & Co [1940] 3 All ER 60 at 71.

    [12]   Shevill v Builders Licensing Board (1982) 149 CLR 620 at 633 (Wilson J), citing Mersey Steel and Iron Co v Naylor, Benzon & Co (1884) 9 App Cas 434 at 438 - 439; Aclaw Pty Ltd v Fullston [2000] SASC 440 at [17] (Duggan J).

14. Ms Szlasa rejected the attempts to settle on the ground that she had already lawfully terminated the contract on 4 August 2008.  The Judge’s finding that this was “sufficient acceptance” by Ms Szlasa of the vendor’s repudiation, was incorrect.  There was no vendor repudiation.  There had been, as discussed above, no prior lawful termination by Ms Szlasa. 

15. The Judge’s conclusion that First Pacific abandoned the contract cannot be sustained.  At all times from August 2008, the vendor maintained that the contract remained on foot.  There is a clear documentary trail evidencing this state of affairs.  First Pacific and Provident Capital wished to proceed with the contract and to settle. 

16. There was no repudiation by First Pacific or Provident Capital.  There was no abandonment by First Pacific or Provident Capital.  There was no conduct on the part of First Pacific or Provident Capital that would give rise to any form of estoppel.

    Conclusion

17. I would allow the appeal.  I would set aside the orders made by the trial Judge.  The deposit of $45,000.00 should be paid to Provident Capital.  I would hear the parties as to the terms of an order to give effect to my reasons.  I would hear the parties as to costs.

18. ANDERSON J.     I agree that the appeal should be allowed. I agree with the orders proposed by Gray J and I agree with his reasons.

19. KELLY J:             I agree with the orders proposed by Gray J and with his reasons.