Re Premier Bay Pty Ltd - [2018] VSC 168

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL COURT

S ECI 2017 00129

BETWEEN

DFG SERVICES PTY LTD & ORS	Plaintiffs
v
PREMIER BAY PTY LTD & ORS	Defendants

AND BETWEEN

PREMIER BAY PTY LTD & ORS	Plaintiffs
v
DFG SERVICES PTY LTD & ORS	Defendants

AND

MAURO MONTALTO	Plaintiff
v
DFG SERVICES PTY LTD & ORS	Defendants

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JUDGE:	ROBSON J
WHERE HELD:	Melbourne
DATE OF HEARING:	30, 31 October, 1, 2, 9, 10, 16, 17, 20, 22 and 23 November 2017
DATE OF JUDGMENT:	13 April 2018
CASE MAY BE CITED AS:	Re Premier Bay Pty Ltd
MEDIUM NEUTRAL CITATION:	[2018] VSC 168

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CONTRACT – Property Development Agreement – Specific enforcement – Agreement involved landowners making available land for development by the developer – The Agreement provided Lots 1, 2 and 3 of the landowners’ land to be included in the property development – Landowner refuses to carry out the obligations under the agreement – The developer seeks specific performance.

CONTRACT – Property Development Agreement – Rectification for unilateral mistake – Landowner claims that Lot 1 was not to be included in the contract – Landowner seeks to have the Agreement rectified – Consideration of ‘special circumstance’.

GUARANTEE – The landowner under the Property Development Agreement is a company – Its two directors guaranteed the obligations of the landowner – One of the directors seeks to have the guarantee set aside on equitable grounds.

DAMAGES CLAIM – Negligence – Breach of retainer – Breach of duty of care – Wrongs Act 1958 – The landowner seeks damages against its solicitors and accountant, in the event the contract is not rectified, for failing to ensure that Lot 1 was not included in the development.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr J W S Peters QC with Mr S Rosewarne	Hall & Wilcox
For the First and Second Defendants	Mr S M Anderson QC with Ms K O’Gorman	Holding Redlich
For the Third Defendant	Mr J P Slattery	Piper Alderman
For the Fourth Defendant by Counterclaim	Mr J Tsalanidis	Colin Biggers & Paisley
For the Fifth Defendant by Counterclaim	Mr S R Senathirajah SC	Wotton & Kearney

TABLE OF CONTENTS

Introduction and summary................................................................................................ 1
The parties............................................................................................................................ 4
The development................................................................................................................. 5
Planning................................................................................................................................ 7
The relevant events............................................................................................................. 7
Mr Montalto’s pleaded case............................................................................................. 23
Findings between DFG and the defendants.................................................................. 30
Counterclaim against Crowe Horwath........................................................................... 30
Counterclaim against Sladen........................................................................................... 31
The witnesses..................................................................................................................... 32
Mr Montalto’s special disability..................................................................................... 33
Evidence of Dr Tailby....................................................................................................... 34
Evidence of Dr March....................................................................................................... 36
Evidence of Mr Montalto.................................................................................................. 37
Alleged conversation no 1................................................................................................ 39
Response of Mr Levinge and Mr Dooling..................................................................... 41
Mr Montalto’s evidence continued................................................................................. 43
Alleged conversation no 6................................................................................................ 45
Response of Mr Jeremiah, Mr Di Felice, and Mr Brown.............................................. 48
Alleged conversation no 5................................................................................................ 52
Alleged conversations no 2 and no 3.............................................................................. 52
Response of Mr Dooling and Mr Levinge..................................................................... 57
Mr Montalto’s evidence continued................................................................................. 61
Alleged conversation no 4................................................................................................ 65
Response of Mr Levinge, Mr Dooling, Mr Di Felice…

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.

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Details

Case: [2018] VSC 168
Decision Date: 13 April 2018

CaseChat Overview and Summary

Premier Bay Pty Ltd sought an order for specific performance of a Property Development Agreement from the landowner, who had refused to make Lot 1 of their land available for development. The landowner contended that Lot 1 was not part of the agreement and sought rectification. Additionally, one director of the landowner company sought to have their personal guarantee of the landowner’s obligations set aside on equitable grounds. The landowner also brought a damages claim against its solicitors and accountant for failing to ensure that Lot 1 was not included in the development, alleging negligence, breach of retainer, and breach of duty of care under the Wrongs Act 1958.

The court considered whether the Property Development Agreement should be specifically enforced, whether it should be rectified due to a unilateral mistake, and whether the guarantee provided by one director could be set aside. The court also examined the landowner's damages claim against their solicitors and accountant.

The court held that the agreement should be specifically enforced as the landowner had clearly agreed to the terms, and there was no evidence of any special circumstances warranting rectification of the agreement. The court found that the guarantee provided by the director could not be set aside because there was no evidence of unconscionability or duress. Regarding the damages claim, the court held that the landowner’s solicitors and accountant were not liable because they had acted with reasonable care and skill.

The court ordered the landowner to specifically perform the Property Development Agreement, including making Lot 1 available for development. The guarantee provided by the director remained enforceable, and the landowner's claim against their solicitors and accountant was dismissed.

Orders