Siev v Magid

[2004] NSWCA 135

CITATION:	Siev v. Magid [2004] NSWCA 135 revised - 06/05/2004
HEARING DATE(S):	26 and 27 February 2004
JUDGMENT DATE:	5 May 2004
JUDGMENT OF:	Mason P at 1; Hodgson JA at 28; Stein AJA at 129
DECISION:	Appeal dismissed with costs.
CATCHWORDS:	CONTRACTS - Interpretation - Extrinsic evidence - Breach - Whether justifying termination - Recovery of money paid - Whether payment conditional or unconditional - Total failure of consideration.
CASES CITED:	Baltic Shipping Co. v. Dillon (1993) 176 CLR 344 Commonwealth Securities Ltd. v. South Pacific Pty. Ltd. [2003] NSWCA 199 David Securities Pty. Ltd. v. Commonwealth Bank of Australia (1992) 175 CLR 353 Heckenberg v. Delaforce [2000] NSWCA 137 Rawson v. Hobbs (1961) 107 CLR 466 Saunders v. Vautier (1841) Cr & Ph 240, 41 ER 482
PARTIES :	Dan Siev - appellant Robert Magid - respondent
FILE NUMBER(S):	CA 40688/03
COUNSEL:	Mr. R. Ellicott QC with Mr. J. Robson for appellant Mr. D. Hammerschlag SC with Ms. E. Frizell for respondent
SOLICITORS:	Hunt & Hunt for appellant Blake Dawson Waldron for respondent

LOWER COURTJURISDICTION:	Supreme Court - Equity Division
LOWER COURT FILE NUMBER(S):	ED 50135/01
LOWER COURT JUDICIAL OFFICER :	Macready AJ

CA 40688/03
ED 50135/01

MASON P
HODGSON JA
STEIN AJA

Wednesday 5 May 2004

SIEV V. MAGID

HEADNOTE

FACTS
By an agreement dated 23 March 2000, the appellant agreed to sell his rights in certain shares to the respondent for US$1,500,000, one half of which was payable within 21 days and the balance of which was payable within 15 months. The agreement provided that, upon receipt of the first payment, the appellant would take certain steps to give effect to the transfer of his rights in the shares to the respondent.

The respondent made the first payment, but the appellant did not take the required steps at all (per Hodgson JA, Stein AJA agreeing) or until May 2001 (per Mason P). The appellant did not at any time achieve an effective transfer of the rights in the shares to the respondent. The respondent purported to terminate the agreement in August 2001.

The appellant sued the respondent for the second payment, and the respondent cross-claimed for recovery of the first payment. The primary judge found for the respondent on both claims. On appeal to the Court of Appeal:

HELD
(1) The appellant had committed a breach of the agreement entitling the respondent to terminate it.
(2) Accordingly, the appellant was not entitled to the second payment.
(3) Steps in performance of the agreement prior to effective transfer of the rights in the shares were conditional upon such transfer taking place, and since it had not taken place, the respondent was entitled to recover the first payment.

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CA 40688/03
ED 50135/01

MASON P
HODGSON JA
STEIN AJA

Wednesday 5 May 2004

SIEV V. MAGID

Judgment

1 MASON P: I have had the benefit of reading the judgment of Hodgson JA. It set out the facts and issues. Subject to what follows, I agree with his Honour’s…