Sentinel Property Group Pty Ltd v ABH Hotel Pty Ltd

Sentinel Property Group Pty Ltd (SPG) brought an action against ABH Hotel Pty Ltd (ABH) regarding an option to purchase the site of the Airlie Beach Hotel. The dispute arose from a Heads of Agreement (HOA) dated 7 October 2020, where ABH granted SPG a call option over the land. ABH terminated this option on 13 November 2020, and SPG attempted to exercise the option on 11 December 2020. The primary issues before the court were whether the parties were bound by the HOA, whether ABH effectively terminated the HOA, whether ABH breached the HOA, and whether SPG's attempt to exercise the option had any legal effect.

The court found that the conduct of both parties after 7 October 2020 was consistent with their belief that they were bound by the HOA but not by the Memorandum of Agreement (MOA) or the Proforma Lease. The court ruled that ABH had indeed terminated the call option under the HOA by its letter dated 13 November 2020. Consequently, SPG had no interest in the land, and neither SPG nor the defendant added by counterclaim had any interest in the land. The court granted SPG leave to file a fourth amended statement of claim, entered judgment in favour of ABH on both the plaintiff's claim and the defendant's counterclaim, and ordered the removal of the caveat lodged by SPG over the title to the land.