Riggall v Thompson

Case [2010] QCA 144


SUPREME COURT OF QUEENSLAND

CITATION:

Riggall & Anor v Thompson [2010] QCA 144

PARTIES:

EMMA THOMPSON
(defendant/appellant)
v
BRIAN NOEL MANSON RIGGALL AND JANE REIMAN RIGGALL
(plaintiff/respondent)

FILE NO/S:

Appeal No 10090 of 2009
DC No 422 of 2007

DIVISION:

Court of Appeal

PROCEEDING:

General Civil Appeal

ORIGINATING COURT:


District Court at Brisbane

DELIVERED ON:

11 June 2010

DELIVERED AT:

Brisbane

HEARING DATE:

11 March 2010

JUDGES:

Holmes and Fraser JJA and Daubney J
Separate reasons for judgment of each member of the Court, each concurring as to the orders made

ORDERS:

1.   Appeal allowed to the extent of reducing the judgment ordered in the District Court from $72,817.16 to $70,724.55;

2.   Appellant to pay the respondent’s costs of the appeal.

CATCHWORDS:

CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – CONSTRUCTION AND INTERPRETATION OF CONTRACTS – PENALTIES AND LIQUIDATED DAMAGES – GENERAL PRINCIPLES – where the appellant entered into a contract to buy a residential lot from the respondents – where the appellant was unable to pay the purchase price on the settlement date and extended settlement dates – where the respondents terminated the contract and resold the lot – where the trial judge assessed damages at $72,201.28, subsequently amended to $72,817.16, which included the loss on resale, the holding costs incurred after the appellant’s default, legal fees, real estate agent’s fees and costs, and interest – where the trial judge concluded that clause 9.3  entitled the respondents to adopt all of the options in clause 9 subject to the provisions of clauses 9.4 and 9.5 and at all times subject to the overarching principle of reasonableness in the assessment of damages – whether the primary judge erred in assessing damages under clause 9

CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – CONSTRUCTION AND INTERPRETATION OF CONTRACTS – PENALTIES AND LIQUIDATED DAMAGES – OTHER PARTICULAR CASES – where the appellant challenged the primary judge’s allowance under clause 9.4(1)(b) for real estate agent’s fees and costs and legal fees relating to the contract – whether clause 9.4(1)(b) was penal in allowing the respondents to recover expenses of the contract and expenses of the resale – whether the amount recoverable under clause 9.4(1)(b) was out of all proportion with the loss which the parties might have anticipated at the time of the contract as flowing from the breach and termination of the contract – whether clause 9.4(1)(b) was an unenforceable penalty

CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – CONSTRUCTION AND INTERPRETATION OF CONTRACTS – PENALTIES AND LIQUIDATED DAMAGES – GENERAL PRINCIPLES – where the appellant challenged the primary judge’s allowance of holding costs under clause 9.5 – whether the primary judge erred in allowing the respondents to recover holding costs incurred after the appellant’s default

AHR Constructions Pty Ltd v Maloney [1994] 1 Qd R 460, cited
AMEV-UDC Finance Ltd v Austin (1986) 162 CLR 170; [1986] HCA 63, cited
Botherway v Stinson [1921] NZLR 403, cited
Buchanan v Dunstan [2007] NSWSC 248; cited
Burns v MAN Automotive (Aust) Pty Ltd (1986) 161…

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AGLC
Riggall v Thompson [2010] QCA 144
Case
[2010] QCA 144
Decision Date

CaseChat Overview and Summary

In the case of Riggall v Thompson, the appellant, Riggall, entered into a contract with the respondents, Thompson, for the purchase of a residential lot. When Riggall failed to pay the purchase price on the settlement date and subsequently missed extended settlement dates, the respondents terminated the contract and resold the lot. The trial judge awarded damages of $72,201.28, later amended to $72,817.16, which included loss on resale, holding costs incurred post-default, legal fees, real estate agent's fees, and costs, along with interest. The trial judge concluded that clause 9.3 of the contract entitled the respondents to exercise all options under clause 9, subject to clauses 9.4 and 9.5, and always adhering to the overarching principle of reasonableness in assessing damages.

The primary legal issues before the court were whether the trial judge erred in assessing the damages under clause 9 and whether certain components of the damages, particularly those under clause 9.4(1)(b) and clause 9.5, were permissible. Riggall contested the allowance of real estate agent's fees and costs, as well as legal fees, arguing these were penal and disproportionate to the anticipated loss at the time of the contract. Additionally, Riggall argued that the holding costs incurred after the default were not recoverable. The court was tasked with determining the enforceability of these clauses in light of the principles governing penalties and liquidated damages.

The court found that while the principle of reasonableness applied to the assessment of damages, certain components of the damages were excessive. Specifically, the court reduced the amount of legal fees and real estate agent's fees and costs to a sum that was deemed reasonable. The court also held that the holding costs were recoverable, but the amount allowed was adjusted to reflect a more equitable recovery. The overall judgment was thus reduced from $72,817.16 to $70,724.55.

In summary, the appeal was allowed to the extent of reducing the judgment ordered in the District Court from $72,817.16 to $70,724.55, with the appellant, Riggall, ordered to pay the respondents' costs of the appeal. The court's decision underscores the importance of balancing the principle of reasonableness in the assessment of damages with the specific terms of the contract and the nature of the anticipated loss.

Orders

Orders of the court

1. Appeal allowed to the extent of reducing the judgment ordered in the District Court from $72,817.16 to $70,724.55;

2. Appellant to pay the respondent’s costs of the appeal.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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