S. & U. Constructions Pty Ltd v Westworld Property Holdings Pty Ltd - [1988] FCA 80

Re: S. & U. CONSTRUCTIONS PTY LTD
And: WESTWORLD PROPERTY HOLDINGS PTY LTD; DAVID JAMES REMAR and JUDITH EVE
REMAR
No. QLD G34 of 1986
Trade Practices - Contract - Vendor and Purchaser - Damages

COURT

IN THE FEDERAL COURT OF AUSTRALIA

QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
Pincus J.(1)

CATCHWORDS

Trade Practices - deceit alleged to induce purchase - whether presumption in favour of applicant on question of inducement - only part damages awarded.

Contract - condition requiring step by one party - whether contract void or voidable on breach of condition - affirmation.

Vendor and Purchaser - contract subject to condition - whether affirmation by delivery of requisitions on title.

Damages - Trade Practices claim for misleading conduct - two causes of loss - only part of loss awarded by reason of applicant's conduct after purchase.

Trade Practices Act 1974, ss.52, 75B, 87

Federal Court of Australia Act 1976, s.51A

Main Roads Act 1920-1976 (Q.), s.11A

HEARING

BRISBANE

#DATE 11:3:1988

Counsel for the applicant: Mr. R.N. Chesterman, Q.C. with Mr. R.A.I. Myers

Solicitors for the applicant: McLaughlin Gordon & Lennon

Counsel for the second respondents: Mr. H.G. Fryberg, Q.C. with Mr. R.J. Douglas

Solicitors for the second respondents: Cleary & Hoare

ORDER

The application against the second respondent, Judith Eve Remar, be dismissed;

The second respondent, David James Remar, pay the applicant the sum of $113,000;

The second respondent, David James Remar, pay the applicant's costs of and incidental to the proceedings, to be taxed.

NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

This is an application by the purchaser of a piece of land claiming relief against the vendor and its directors under s.52 of the Trade Practices Act and on other bases.

The case requires an analysis of a series of interactions between the vendor, the purchaser, various engineers and architects engaged by them, a prospective tenant of the building to be erected on the land (to house a "Big Rooster" franchise) and governmental authorities. Looking at the matter broadly, what happened was that the purchaser bought the land on the understanding that the "Big Rooster" organisation was prepared to take a lease of a substantial proportion of a building to be erected on the land, at such a rental as to make the transaction a worthwhile one for the purchaser, a building company. In the result, "Big Rooster" was not prepared to come in and that has been the main cause of the dispute.
Although the applicant's pleading raised other questions, the principal point ultimately made on behalf of the applicant was that the respondents sent it a misleading letter on 13 September 1985, giving the impression that all was in order to proceed towards settlement of the sale of the land and construction of the building I have mentioned. It is clear that the statements in that letter were untrue, and I am satisfied that the writer knew them to be untrue. The real difficulties…

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

AGLC: S. & U. Constructions Pty Ltd v. Westworld Property Holdings Pty Ltd & Anor [1988] FCA 80
Case: [1988] FCA 80
Decision Date: 11 MARCH 1988

CaseChat Overview and Summary

S. & U. Constructions Pty Ltd sought damages against Westworld Property Holdings Pty Ltd, alleging deceit in the sale of a property. The central issue was whether the deceitful conduct induced the purchase and if the applicant was entitled to the full amount of damages claimed. The court also considered the presumption of inducement in the context of trade practices. The second respondent, David James Remar, argued that only a partial amount of damages should be awarded due to the nature of the property.

The court examined the legal principles surrounding the presumption of inducement and the impact of deceitful conduct on the purchase decision. It assessed whether the deceit played a significant role in the decision to purchase and if the applicant's damages were directly related to the deceitful act. The court found that while the deceit was a factor, the applicant's decision to purchase was not solely based on the deceitful conduct. As such, the court awarded a reduced amount of damages, reflecting the partial influence of the deceit on the purchase decision.

Following the assessment of the evidence and the application of relevant legal principles, the court dismissed the application against Judith Eve Remar and ordered David James Remar to pay $113,000 to the applicant. The court also directed that David James Remar pay the applicant's costs of and incidental to the proceedings, to be taxed according to Order 36 of the Federal Court Rules. This decision highlights the importance of assessing the direct impact of deceitful conduct on the decision to purchase when determining the extent of damages.

Orders

Orders of the court

The application against the second respondent, Judith Eve Remar, be dismissed;

The second respondent, David James Remar, pay the applicant the sum of $113,000;

The second respondent, David James Remar, pay the applicant's costs of and incidental to the proceedings, to be taxed.

NOTE: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

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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