Source & Resources Pty Ltd v Porada & Anor - [2007] NSWSC 883

Reported Decision:
(2007) NSW Conv R 56-193

New South Wales

Supreme Court

CITATION: Source & Resources Pty Ltd v Porada & Anor [2007] NSWSC 883

HEARING DATE(S): 18/07/07

JUDGMENT DATE :
13 August 2007

JUDGMENT OF: Gzell J

DECISION: Declaration that the plaintiff had validly rescinded the contract. No order as to damages under the Real Property Act 1900, s 74P(1)(c).

CATCHWORDS: CONTRACTS - General Contractual Principles - Waiver - Conditional contract for sale of land to defendants with rights to rescind if condition not met by specified date - Plaintiff purported to rescind after time had expired - Whether by continuing appeal against refusal of local council to approve plan of subdivision of the land the plaintiff had elected to keep the contract on foot - CONVEYANCING - Land Title under the Torrens System - Caveats against Dealings - Caveat lodged with honest belief, based upon reasonable grounds, that caveators had a caveatable interest - No evidence that opinion had changed - Whether plaintiff entitled to damages under the Real Property Act 1900, s 74P(1)(c) because of alleged unreasonable stand in commercial negotiations for withdrawal of the caveat to allow refinancing

LEGISLATION CITED: Real Property Act 1900
Real Property Amendment Act 1996

CASES CITED: Craine v Colonial Mutual Fire Insurance Co Ltd (1920) 28 CLR 305
United Australia Ld v Barclay’s Bank Ld [1941] AC 1
Sargent v ASL Developments Ltd (1974) 131 CLR 634
Gilbert v Healey Investment Pty Ltd (1975) 1 NSWLR 650
Treloar Nominees Pty Ltd v Buttrey (1977) 1 BPR 97077
Shield Properties & Investments Ltd v Anglo-Overseas Transport Co Ltd (1985) 273 Estates Gazette 69
Elspan v Eurocopta [1999] NSWSC 555
Bedford Properties Pty Ltd v Surgo Pty Ltd (1981) 1 NSWLR 106
Beca Developments Pty Ltd v Idameneo (No 92) Pty Ltd (1990) 21 NSWLR 459
Dykstra v Dykstra (1991) 22 NSWLR 556
Gustin v Taajamba Pty Ltd (1994) 6 BPR 97468
Commonwealth Bank of Australia v Baranyay [1993] 1 VR 589
Edmonds v Donovan (2005) 12 VR 513

PARTIES: Source & Resources Pty Ltd - Plaintiff
Hans Joachim Porada - First Defendant
Rhonda Christine Porada - Second Defendant

FILE NUMBER(S): SC 1524/07

COUNSEL: Mr E Cox - Plaintiff
Mr I Faulkner SC - Defendant

SOLICITORS: Walker Hedges & Co Solicitors - Plaintiff
Warren McKeon Dickson Lawyers - Defendants

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

GZELL J

MONDAY 13 AUGUST 2007

1524/07 SOURCE & RESOURCES PTY LTD v HANS JOACHIM PORADA & ANOR

JUDGMENT

Introduction

1 Hans Joachim Porada and Rhonda Christine Porada, the defendants, entered into a contract for sale of land with the plaintiff, Source & Resources Pty Ltd, to purchase lots 15 and 16 in an unregistered plan of subdivision of land at Pambula Lake, Princes Highway, Broadwater, in New South Wales. Completion of the contract was conditional upon Source & Resources obtaining the approval of the local council to the subdivision plan by a specified date. That date was extended on two occasions, 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 Source & Resources Pty Ltd v Porada & Anor

Details

AGLC: Source and Resources Pty Ltd v Porada [2007] NSWSC 883
Case: [2007] NSWSC 883
Decision Date: 13 August 2007

CaseChat Overview and Summary

The parties involved in this case are Source & Resources Pty Ltd, the plaintiff, and Porada & Anor, the defendants. The dispute concerns a conditional contract for the sale of land, where the defendants had the right to rescind if a specified condition was not met by a certain date. The plaintiff attempted to rescind the contract after the time had expired. The court was required to determine whether the plaintiff's actions in continuing an appeal against the local council's refusal to approve a plan of subdivision of the land constituted an election to keep the contract in place. Additionally, the court had to consider whether the plaintiff was entitled to damages under the Real Property Act 1900, s 74P(1)(c) due to the defendants' alleged unreasonable stand in commercial negotiations for the withdrawal of a caveat that had been lodged to allow refinancing.

The court examined whether the plaintiff's continued appeal against the council's decision constituted an election to maintain the contract. It was found that the plaintiff had not effectively elected to keep the contract on foot by continuing the appeal. The court also considered the issue of the caveat lodged by the plaintiff, which was based on an honest belief and reasonable grounds that the plaintiff had a caveatable interest. There was no evidence that this opinion had changed. The court assessed whether the plaintiff was entitled to damages due to the defendants' alleged unreasonable conduct in refusing to withdraw the caveat to allow refinancing. The court concluded that the plaintiff was not entitled to damages under the Real Property Act 1900, s 74P(1)(c) because there was no evidence of unreasonable conduct by the defendants.

In conclusion, the court ruled that the plaintiff's continued appeal did not amount to an election to keep the contract on foot. Furthermore, the plaintiff was not entitled to damages due to the defendants' refusal to withdraw the caveat. The orders of the court reflect these findings, dismissing the plaintiff's claims and affirming the rights of the defendants under the conditional contract for the sale of land.

Orders