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Salienta v Clancy

Salienta v Clancy

Case [1999] NSWSC 916 14 September 1999

Contract Formation

Proprietary Estoppel

Agricultural Tenancies

Property Law

Contract Law

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CITATION: SALIENTA v CLANCY & ANOR [1999] NSWSC 916

CURRENT JURISDICTION: EQUITY

FILE NUMBER(S): 2747 OF 1998

HEARING DATE(S): 9 &10/3; 7-11 & 30/6; 1 & 2/7/99

JUDGMENT DATE:
14 September 1999

PARTIES :

Salienta Pty Ltd v. Stephen William Clancy & Anor

JUDGMENT OF: Bryson J at 1

COUNSEL : I.G. Harrison SC and A.J. McInerney for Plaintiff
M. Einfeld QC and G. Parker for Defendants

SOLICITORS: Hunt & Hunt for Plaintiff
Greaves Wannan & Williams for Defendants

CATCHWORDS: VENDOR and PURCHASER; PROPRIETARY ESTOPPEL; AGRICULTURAL TENANCIES; - Forsyth QC and his trust co. owned 12000 ac Yarrawah at Hay and permitted Clancy and his trust co. to conduct operations including grazing and cropping from October 1992 until Forsyth died in August 1997. During this time Clancy carried out extensive irrigation works and other improvements with Forsyth's knowledge approval and encouragement and earnt large sums from operations. The basis of dealing was recorded in a long series of letters and several documents - Option, Memorandum, Contract and Licence. Contract was poorly drafted by Forsyth and neogtiations for over 2 years between solicitors for formal contract to be exchanged did not result in exchange. Several weeks before Forsyth's death Clancy objected to the price and contended it was unfair and did not give credit for his improvements. Forsyth's executors treated this as repudiation, gave notice of termination and sued for possession. Clancy disputed that the Contract was intended to be binding, alleged that it was unconscionable, alleged a Proprietary Estoppel and relied on the Agricultural Tenancies Act. These defences failed on the facts, principally (1) the Contract was intended to be binding (2) If there had been room for Proprietary Estoppel, the property was held out as available only on payment of Forsyth's price, which Clancy was unwilling to pay (3) there was no sharefarming arrangement as between Forsyth and Clancy.

ACTS CITED: Agricultrual Tenancies Act 1990 ss.19, 27.

CASES CITED: Austotel Pty Ltd v. Franklins Selfserve Pty Ltd (1989) 16 NSWLR 502 at 604
Cameron v. Murdoch (1986) 63 ALR 575
Dudgeon v. Chie (1954) 55 SR (NSW) 450
Dudgeon v. Chie (1955) 92 CLR 342 at 347
Plimmer v. Wellington Corporation (1884) 9 App. Cas. 699
Silovi Pty Ltd v. Barbaro & Ors (1988) 13 NSWLR 466
Waltons Stores (Interstate) Ltd v. Maher (1988) 164 CLR 387

DECISION: See para.114

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

BRYSON J.

TUESDAY 14 SEPTEMBER 1999

2747 of 1998 SALIENTA PTY LTD v STEPHEN WILLIAM CLANCY & ANOR
JUDGMENT

1 HIS HONOUR: The litigation and the parties. These proceedings relate to possession and ownership of “Yarrawah”, a rural property in the Hay district said to contain approximately 12,000 acres. Yarrawah is the land in Certificates of Title Volume 14803 Folio 20 and Identifiers 9/756766 and 13/756766. There are now extensive irrigation works on the property, almost all of which were constructed by the defendants since the relevant events opened in October 1992. 2 The Arrangement of the Judgment.
The…

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.

Continue reading Salienta v Clancy

Details

AGLC: Salienta v Clancy [1999] NSWSC 916
Case: [1999] NSWSC 916
Decision Date: 14 September 1999

CaseChat Overview and Summary

In the case of Salienta v Clancy, the dispute involved a complex set of land dealings between the vendor, Forsyth QC and his trust company, and the purchaser, Clancy and his trust company, over the 12,000-acre Yarrawah property at Hay. The vendor granted the purchaser rights to conduct operations, including grazing and cropping, from October 1992 until the vendor's death in August 1997. The purchaser undertook extensive irrigation works and other improvements with the vendor's knowledge, approval, and encouragement, and earned significant sums from the operations. The basis of the dealing was recorded in a series of letters and several documents, including an Option, Memorandum, Contract, and Licence. Despite negotiations for over two years, the parties did not exchange a formal contract. Several weeks before the vendor's death, the purchaser objected to the price, contending it was unfair and did not credit his improvements. The vendor's executors treated this as repudiation, gave notice of termination, and sued for possession. The purchaser disputed that the Contract was intended to be binding, alleged it was unconscionable, and asserted a claim of Proprietary Estoppel. The purchaser also relied on the Agricultural Tenancies Act.

The legal issues before the court included whether the Contract was intended to be binding, whether there was room for a Proprietary Estoppel, and whether there was a sharefarming arrangement under the Agricultural Tenancies Act. The court found that the Contract was indeed intended to be binding and that if there had been any room for Proprietary Estoppel, the property was held out as available only on payment of the vendor's price, which the purchaser was unwilling to pay. Furthermore, the court determined that there was no sharefarming arrangement between the parties. These findings led to the conclusion that the purchaser's defences failed on the facts.

The court's reasoning was based on the detailed documentary evidence and the parties' conduct over the years. The court found that the extensive works undertaken by the purchaser and the large sums earned from the operations, all with the vendor's knowledge and encouragement, supported the conclusion that the Contract was intended to be binding. The court also found that the property was held out as available only on payment of the vendor's price, which foreclosed any claim of Proprietary Estoppel. Finally, the court held that there was no sharefarming arrangement as between the parties, which meant that the Agricultural Tenancies Act did not apply. The outcome was that the vendor's executors were entitled to possession of the property.

The final orders of the court were that the purchaser's defences failed and that the vendor's executors were entitled to possession of the Yarrawah property at Hay. The purchaser was ordered to vacate the property and pay any costs associated with the proceedings.

Orders