Ruthol Pty Ltd v Tricon (Australia) Pty Ltd

Ruthol Pty Ltd (the purchaser) and Tricon (Australia) Pty Ltd (the vendor) were parties to a contract for the sale of land. The purchaser was also the lessee of the land from the vendor. The vendor sued the purchaser for rent allegedly owed for the period of delay in completing the sale. The purchaser counterclaimed for damages for breach of contract, alleging the vendor caused the delay. The matter came before the Court of Appeal of New South Wales.

The Court of Appeal was required to determine whether the vendor was entitled to claim rent for the period of delay, notwithstanding that the delay was allegedly caused by the vendor's own breach of contract. Further, the court had to consider whether the purchaser, if entitled to damages for the delay, should receive an allowance for the benefit of not having to pay the purchase price during that period. The court also needed to assess whether any such benefit was caused by the vendor's breach.

The court held that the vendor was entitled to rent for the period of delay. It reasoned that the lease and the contract for sale were separate agreements, and the purchaser's obligation to pay rent under the lease remained despite the delay in completion of the sale. Regarding the purchaser's counterclaim for damages, the court found that while the purchaser was entitled to damages for the delay, no allowance should be made for the benefit of not having to pay the purchase price. This was because the court found that any such benefit was not caused by the vendor's breach of contract, but rather by the purchaser's own decision to delay completion. The court applied the principle that damages are awarded to compensate for loss caused by the breach, and not for benefits that arise independently of the breach.

The appeal was dismissed with costs.