Rasch Nominees Pty Ltd v Bartholomaeus

Rasch Nominees Pty Ltd appealed to the Full Court of the Supreme Court of South Australia against a refusal to grant specific performance of a contract for the sale of real estate. The contract, entered into on 31 October 2005, involved Rasch Nominees purchasing three allotments of land from Mr and Mrs Bartholomaeus. Two of these allotments were subject to a registered lease held by Mount Barker Properties Pty Ltd, which contained a right of first refusal. Subsequently, Mr and Mrs Bartholomaeus sold the same two allotments to Mount Barker Properties, a transaction that settled on 17 January 2006.

The central legal issues before the Full Court were whether Mount Barker Properties could be imputed with knowledge of the Bartholomaeuses' conduct through its director and conveyancer, whether the Bartholomaeuses' actions constituted fraud under the *Real Property Act 1886* (SA) or the principle in *Barnes v Addy*, and whether their conduct amounted to misleading or deceptive conduct in trade or commerce in breach of the *Trade Practices Act 1974* (Cth).

The Court, by majority, dismissed the appeal. It was held that Mount Barker Properties could not be imputed with knowledge of the Bartholomaeuses' misleading and deceptive conduct. Consequently, no relevant finding of fraud could be made against Mount Barker Properties, and as it was not associated with the impugned conduct, there was no basis to grant relief under the *Trade Practices Act*. Furthermore, a majority of the Court found that the sale of the land did occur in trade and commerce, disagreeing with the trial judge's reasoning that the sale was not part of the Bartholomaeuses' trading activities due to their retirement.

The appeal was dismissed. The Court noted that the question of costs would require further consideration.