Solid Investments Australia Pty Ltd v Clifford - [2010] VSCA 59

SUPREME COURT OF VICTORIA

COURT OF APPEAL

No 3787 of 2009

SOLID INVESTMENTS AUSTRALIA PTY LTD
SOLID INVESTMENTS AUSTRALIA PTY LTD	Appellant
v
JENNIFER LILIAN CLIFFORD	1^st Respondent
and
MARIAN MARGARETTA BAYLEY	2^nd Respondent

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JUDGES:	MANDIE and HARPER JJA and EMERTON AJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	9 March 2010
DATE OF JUDGMENT:	24 March 2010
MEDIUM NEUTRAL CITATION:	[2010] VSCA 59
JUDGMENT APPEALED FROM:	Clifford v Solid Investments [2009] VSC 223 (Bongiorno J)

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REAL PROPERTY – Sale of land – Sale of lots on unregistered plan of subdivision – Whether Purchasers had lawfully rescinded contracts under s 9AE(2) of the Sale of Land Act 1962 (Vic) – Whether special condition in contract empowering Vendor to extend period for registration of plan of subdivision meant that ‘another period’ had been ‘specified’ within the meaning of s 9AE(2) – Whether Purchasers had waived or elected not to exercise their right to rescind.

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APPEARANCES:	Counsel	Solicitors
For the Appellant	Mr M H Whitten	Challenge Legal
For the Respondents	Mr T R Messer	Mitchell Burke & Co

MANDIE JA:

The appellant (‘the Vendor’) appeals from a judgment of a judge in the Trial Division by which it was declared that the respondents (‘the Purchasers’) had lawfully rescinded two contracts for the sale of land with the Vendor pursuant to s 9AE(2) of the Sale of Land Act 1962 (Vic) (‘the SLA’).

Facts

By a contract of sale with the Vendor dated 31 July 2006, the first respondent purchased Lot 401 on an unregistered plan of subdivision with respect to a multi-storey development in Geelong. By a contract of sale with the Vendor dated 2 August 2006, both respondents purchased Lot 402 on the same unregistered plan of subdivision. The contracts of sale are relevantly identical and the same questions arose in relation to each of them.

Each of the contracts was expressed to be conditional upon registration of the plan of subdivision and conferred on the Purchasers a right to avoid the contract if the plan was not registered on or prior to ‘the Plan Registration Date’, that date being defined as ‘the date that is 30 months after the Date of Sale’. Thirty months after the Date of Sale under the contracts was 30 January 2009 and 2 February 2009 respectively. However, the contracts also purported to give the Vendor a right to extend the Plan Registration Date in certain circumstances.

The relevant special conditions of the contracts provided as follows:

1.        Definitions and Interpretations
1.1      Definitions
In this contract, unless there is something inconsistent in the subject matter or context: -
(a)       …
‘Plan Registration Date’ means the date that is 30 months after the Day of Sale…

4 Contract condition on registration of plan
4.1This contract is subject to and conditional upon the registration of the Plan;
4.2If the condition referred to in Clause 4.1 hereof is not satisfied prior to the Plan Registration Date the purchaser may at any time after the Plan Registration Date but before 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.

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Details

Case: [2010] VSCA 59
Decision Date: 24 March 2010

CaseChat Overview and Summary

Solid Investments Australia Pty Ltd, acting as the purchaser, filed an action against Clifford, the vendor, concerning the sale of lots on an unregistered plan of subdivision. The dispute was heard in the Supreme Court of Victoria. The central issue was whether the purchasers had the right to lawfully rescind their contracts of sale under section 9AE(2) of the Sale of Land Act 1962 (Vic). This hinged on whether a special condition in the contract, which allowed the vendor to extend the period for registration of the plan of subdivision, constituted a specified 'another period' within the meaning of the Act.

The court had to determine whether the purchasers' right to rescind was affected by the special condition that permitted the vendor to extend the registration period. Furthermore, the court examined whether the purchasers had waived or elected not to exercise their right to rescind. In reaching its decision, the court considered the statutory framework provided by the Sale of Land Act 1962 (Vic) and the contractual terms between the parties. The court's analysis involved interpreting the legislative intent behind section 9AE(2) and assessing whether the special condition aligned with or deviated from this legislative purpose.

The Supreme Court of Victoria ruled that the special condition in the contract did not constitute a specified 'another period' within the meaning of section 9AE(2). Consequently, the purchasers were entitled to rescind the contracts. The court found that the purchasers had not waived or elected not to exercise their right to rescind, as there was no evidence of conduct indicating such a decision. As a result, the court ordered that the contracts of sale were rescinded, and the purchasers were entitled to a refund of their deposits.

Orders