Rashid Raashed v Mosharrof Hussein

[2013] HCASL 7

RASHID RAASHED

v

MOSHARROF HUSSEIN & ANOR

[2013] HCASL 7
S265/2012

1. The applicant commenced proceedings against the respondents seeking to enforce a written contract for the sale of a business to the respondents. The respondents relied on s 7(1)(a) of the Contracts Review Act 1980 (NSW) ("the Act").

2. On 29 October 2010, the Local Court found that the contract was unjust within the meaning of s 7(1)(a). It ordered that the requirement that the respondents pay a contract balance of $50,063 not be enforced. The Magistrate found, inter alia, that there was a material inequality in bargaining power (s 9(2)(a)); that at the time the contract was made, the respondents were not able to negotiate the contract conditions (s 9(2)(b)); that the respondents were denied an opportunity to obtain legal advice (s 9(2)(h)); and that the respondents were the victims of undue influence (s 9(2)(j)(i)).

3. The applicant appealed to the Supreme Court of New South Wales (Harrison AsJ).  The applicant did not attack the conclusion that the contract was unjust.  Rather, the principal complaint was that the Magistrate had erred in declining to enforce the relevant contractual term to pay the balance in circumstances where it was not possible, in the absence of evidence of valuation, to determine if and to what extent the respondents suffered any financial loss.  The appeal was dismissed.

4. On 24 August 2012, the Court of Appeal of the Supreme Court of New South Wales (Macfarlan JA and Sackville AJA) refused the applicant leave to appeal.  The Court considered that the Magistrate had not erred by failing to take into account a relevant consideration, ie the extent of the benefits obtained by the respondents under the contract.  It held that even if the respondents did receive benefits under the contract of greater value, the amount in issue on any appeal would be limited.  It held that it was not clear that an injustice had occurred, that no question of general principle was at stake, and that the amount in issue on appeal – approximately $29,000 – was far below the threshold of $100,000 to be crossed before an appeal lay as of right.  The Court noted that the costs expended by the parties were disproportionate to the amount in issue. 

5. Several parts of the Applicant's Written Case in this Court stray beyond the only ground in the Draft Notice of Appeal, which is:

   "That relief under the [Act] by way of non-enforcement of a contract in respect of which property had passed to the Respondents and in respect of which the Respondents had placed themselves in a position of being unable to provide 'restitutio in integrum' should not be granted as against the Appellant unless the extent of the non-enforcement was limited to the amount of any loss established by the evidence to have been occasioned to the Respondents as a result of their entry into an unjust contract."

6. The points made by the Court of Appeal in relation to this issue are, with respect, correct.  An appeal would have insufficient prospects of success. 

7. The application is dismissed.

8. Pursuant to r 41.10.5 we direct the Registrar to draw up, sign and seal an order dismissing the application.

J.D. Heydon
26 February 2013 V.M. Bell