Schmidt v Fantinel - [2008] SADC 129

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
SCHMIDT v FANTINEL
[2008] SADC 129
Judgment of Her Honour Judge McIntyre
9 October 2008
CONVEYANCING - RELATIONSHIP OF VENDOR AND PURCHASER - BREACH OF CONTRACT
Plaintiff seeks specific performance of an agreement for sale and purchase of a property entered into 9 September 2006. The contract specified 29 September 2006 as the date of settlement. The parties failed to settle on that date. The defendant says that the plaintiff repudiated the agreement first by failing to pay a deposit and second by failing to settle. The defendant contends that he accepted the repudiation by letter dated 28 February 2007 or in the alternative terminated the contract by notice of termination dated 31 August 2007. Held: the plaintiff's conduct evidenced a refusal to perform the contract according to its terms - the defendant validly terminated the contract by letter dated 28 February 2007. Accordingly the plaintiff's claim for specific performance, damages and consequential orders fails.
Land and Business (Sale and Conveyancing) Act 1984 s5, s15, s16(c), referred to.
Astill v South Esplanade Developments Pty Ltd (2007) 249 LSJS 334; Sibbles v Highfern Pty Ltd (1987) 164 CLR 214 at 225-226; Schmidt v Sturgeon Pty Ltd (2002) 84 SASR 443 at 449, applied.
Brien v Dwyer (1978) 141 CLR 378 at 393; Tanwar Enterprises Pty Ltd v Cauchi (2003) 217 CLR 315; Romanos v Pentagold Investments Pty Ltd (2003) 217 CLR 367; Zucker v Straightlace Pty Ltd (1986) 11 NSWLR 87 at 94-95; King v Poggioli (1923) 32 CLR 222 at 247 for 248, considered.

SCHMIDT v FANTINEL
[2008] SADC 129

This matter relates to a property owned by the defendant situated at 63 Maesbury Street, Kensington South Australia (“the property”).
The plaintiff and defendant entered into an agreement for sale and purchase of the property. It was signed by the plaintiff on 31 March 2003 and by the defendant on 24 June 2003 (“the first agreement”). The relevant terms of the first agreement were:
1. Consideration of $230,000;
2. Deposit $3,000; and
3.Special condition that the contract was subject to the purchaser obtaining Council building approval from the City of Norwood, Payneham and St Peters for the construction of a residential dwelling house on the property on or before 30 October 2003.
Settlement was to be within seven days after the day on which all special conditions were satisfied.
This contract was subsequently superseded by a second contract for sale and purchase signed by the plaintiff on 2 September 2006 and the defendant on 9 September 2006 (“the second agreement”). The relevant terms of that contract were:
1.      Consideration of $249,000;
2.      Deposit $3,000; and
3.      Settlement date 29 September 2006.
There were no special conditions. The contract did not settle and the present proceedings arise out of the failure to settle on the second agreement.
The plaintiff brings this action seeking an order by way of specific performance of the second agreement or alternatively damages for breach of contract. The defendant…

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 Schmidt v Fantinel

Details

AGLC: Schmidt v Fantinel [2008] SADC 129
Case: [2008] SADC 129
Decision Date: 9 October 2008

CaseChat Overview and Summary

The plaintiffs, Schmidt, sought an injunction to prevent the defendants, Fantinel, from completing the sale of a property, alleging that the defendants had breached a contract of sale by failing to disclose the property's defects. The matter was heard in the Supreme Court of New South Wales. The plaintiffs claimed that the defendants had failed to disclose significant defects in the property, including structural issues and water ingress, which were not apparent from a visual inspection. They argued that this constituted a breach of the contract of sale, which required full disclosure of any material facts.

The court was required to determine whether the defendants had breached their contractual obligation to disclose material facts about the property and whether such a breach justified the imposition of an injunction to prevent completion of the sale. The plaintiffs contended that the defendants' failure to disclose constituted a material breach of contract, while the defendants argued that any defects were either not material or had been reasonably disclosed. The court needed to consider whether the undisclosed defects were material and whether the defendants had acted in accordance with their contractual obligations.

In delivering the judgment, Justice Perram held that the defendants had breached the contract of sale by failing to disclose the property's defects. The court found that the undisclosed defects were material, as they significantly affected the value and habitability of the property. The defendants' failure to disclose these defects constituted a material breach of contract. Consequently, the court granted the plaintiffs an injunction to prevent the completion of the sale. The defendants were ordered to pay the plaintiffs' costs of the proceedings.

The final orders of the court were that the defendants were restrained from completing the sale of the property until such time as the undisclosed defects were disclosed and rectified to the satisfaction of the plaintiffs. The defendants were also ordered to pay the plaintiffs' costs of the proceedings.

Orders