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Rana v Dalla Costa

Rana v Dalla Costa

Case [2014] NSWSC 1113 27 August 2014

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Supreme Court

New South Wales

Medium Neutral Citation: Rana v Dalla Costa [2014] NSWSC 1113
Hearing dates: 23/04/ 2014
Decision date: 27 August 2014
Jurisdiction: Common Law
Before: Harrison AsJ
Decision:
The Court orders that:
(1) The appeal is dismissed.
(2) The decision of his Honour Magistrate Cheetham dated 14 October 2013 is affirmed.
(3) The amended summons filed 4 November 2013 is dismissed.
(4) Costs are reserved.

Catchwords: APPEAL FROM LOCAL COURT - real property - contract for sale of land - split deposit payable by instalments - whether second payment is a penalty - damages - rent earned from the property by the purchaser prior to completion
Legislation Cited: Local Court Act 2007 (NSW), ss 29, 29A, 30, 39, 41
Cases Cited: Ashdown v Kirk [1997] 2 Qd R 12
Boyarsky v Taylor [2008] NSWSC 1415
Financings Ltd v Baldock [1963] 2 Q.B. 104 (CA)
Galafassi v Kelly [2014] NSWCA 190
Golden Oceans (NSW) Pty Ltd v Evewall Pty Ltd [2009] NSWSC 674
Ianello v Sharpe [2007] NSWCA 61
Keneric Tractor Sales Ltd. v Langille [1987] 2 S.C.R 440; (1987) 43 D.L.R. (4th) 171
Luu v Sovereign Developments Pty Limited [2006] NSWCA 40
Ringrow Pty Ltd v BP Australia Pty Ltd [2005] HCA 71; (2005) 224 CLR 656
Romanos v Pentgold Investments Pty Ltd [2003] HCA 58
Shevill v Builders Licensing Board [1982] HCA 47; (1982) 149 CLR 620
Swain v Waverley Municipal Council [2005] HCA 4; (2005) 220 CLR 517
Taylor v Raglan Developments Pty Ltd [1981] 2 NSWLR 117
Texts Cited: John Randall, "Express Termination Clauses in Contracts" (2014) 73(1) Cambridge Law Journal 113
Category: Principal judgment
Parties: Rizwan Rana (Plaintiff)
Elizabeth Dalla Costa (First Defendant)
Representation: Counsel:
C H Cassimatis (Plaintiff)
A D Justice (First Defendant)
Solicitors:
Hunter Family Law Centre (Plaintiff)
Chris Ryan Legal (First Defendant)

File Number(s): 2013/333665
Publication restriction: Nil
Decision under appeal

Date of Decision:

2013-10-14 00:00:00

Before:

Cheetham LCM

File Number(s):

2012/308427

Judgment

HER HONOUR: By summons filed 4 November 2013, the plaintiff appeals from the decision of Magistrate Cheetham dated 14 October 2013 and seeks orders that the appeal be allowed and the judgment in the Court below be set aside.

The plaintiff is Rizwan Rana. The first defendant is Elizabeth Dalla Costa. The second defendant is Salah Bousaleh. The third defendant is Gail Christine Bousaleh. Ms Dalla Costa was the vendor of a property in Hamilton and entered into a contract for sale with Mr Rana and Mr Bousaleh. In the Local Court and in this Court neither Mr Salah Bousaleh nor Mrs Gail Bousaleh played any active role in the proceedings. Neither of them appeared at the hearings in either the Local Court or this Court.

Mrs Bousaleh, who is married to Mr Bousaleh was not a party to the contract for sale of land. As Ms Dalla Costa was the plaintiff in the Local Court and is one of the defendants in this Court and, likewise, Mr Rana was a defendant in the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Rana v Dalla Costa

Details

AGLC: Rana v Dalla Costa [2014] NSWSC 1113
Case: [2014] NSWSC 1113
Decision Date: 27 August 2014

CaseChat Overview and Summary

The appeal before the court involved a dispute between Rana, the appellant, and Dalla Costa, the respondent. The case originated from the Local Court and centred on a contract for the sale of a property. The contract included a split deposit payable by instalments. The central issue was whether the second instalment of the deposit constituted a penalty, and if so, whether the respondent was entitled to damages and whether the appellant was entitled to retain the rent earned by the purchaser prior to completion. The court was required to determine whether the second instalment of the deposit was a genuine pre-estimate of loss or if it was punitive in nature.

The court examined the terms of the contract and the circumstances surrounding the agreement. It noted that the deposit was structured to be paid in two instalments. The court considered whether the second instalment was a proportionate and reasonable pre-estimate of the loss that would be incurred by the respondent if the contract was breached by the appellant. The court also assessed whether the second instalment was a penalty, which would be disproportionate to the loss suffered and would serve a punitive purpose. In addition, the court had to determine the respondent's entitlement to damages for any breach of contract, as well as the appellant's right to retain the rent earned by the purchaser prior to completion.

The court concluded that the second instalment of the deposit was not a penalty but a genuine pre-estimate of loss. The court found that the amount stipulated was not excessive or punitive, and it was a reasonable forecast of the loss the respondent would incur in the event of a breach. Consequently, the respondent was not entitled to damages for the second instalment being a penalty. The court also determined that the appellant was not entitled to retain the rent earned by the purchaser prior to completion as the respondent had not breached the contract, and there was no entitlement to withhold the rent. The appeal was dismissed with the court affirming the decision of the Local Court.

The court's final order was that the appeal be dismissed, and the decision of the Local Court was upheld. The second instalment of the deposit was not a penalty, and the respondent was not entitled to damages. The appellant was not entitled to retain the rent earned by the purchaser prior to completion. The court found that the contract terms were clear and the appellant had not demonstrated any grounds for overturning the Local Court's decision.

Orders