Starco Developments Pty Ltd v Ladd - [1998] QCA 344

IN THE COURT OF APPEAL [1998] QCA 344
SUPREME COURT OF QUEENSLAND
Appeal No. 1804 of 1998
Brisbane
[Starco Developments P/L v. Ladd]
BETWEEN:
STARCO DEVELOPMENTS PTY LTD
A.C.N. 010 290 605

(Plaintiff) Appellant

AND:
CHRISTINE MacLAREN LADD and ROBERT HARLEY FULLER LADD

(Defendants) Respondents
de Jersey C.J.
McPherson J.A.
Thomas J.A.

Judgment delivered 30 October 1998
Separate reasons for judgment of each member of the Court each concurring as to the orders made.
APPEAL DISMISSED WITH COSTS TO BE TAXED.

CATCHWORDS: CONTRACTS - construction - whether an instalment contract pursuant
to section 71 Property Law Act 1974 - whether default in making
payment amounts to repudiation.
Braidotti v. Queensland City Properties Ltd (1991) 172 C.L.R.
293
Wacal Developments Pty Ltd v. Realty Developments Pty Ltd
(1978) 140 C.L.R. 503
Kaneko v. Crawford [1995] Q.Conv.R 54-468
Sibbles v. Highfern Pty Ltd (1987) 164 C.L.R. 214

Counsel: Mr D.B. Fraser QC for the appellant.
Mr T.W. Quinn for the respondents.
Solicitors: Clayton Utz for the appellant.
Horrocks Solicitors for the respondents.
Hearing Date: 30 September 1998
IN THE COURT OF APPEAL
SUPREME COURT OF QUEENSLAND
Appeal No. 1804 of 1998
Brisbane

Before de Jersey C.J.
McPherson J.A.
Thomas J.A.
[Starco Developments P/L v. Ladd]
BETWEEN:
STARCO DEVELOPMENTS PTY LTD
A.C.N. 010 290 605

(Plaintiff) Appellant

AND:
CHRISTINE MacLAREN LADD and ROBERT HARLEY FULLER LADD

(Defendants) Respondents

REASONS FOR JUDGMENT - de JERSEY CJ
Judgment delivered 30 October 1998
1 The appellant was the vendor under two contracts dated 16 January 1989, for the sale of

units to the respondents. The contracts required settlement on 27 November 1989. The contracts
were varied (it is indisputable that there was a variation) by an “addendum” dated 12 December
1989. That addendum authorised the trustee and stakeholder to pay deposits and interest thereon
to the appellant forthwith (clause 1); provided (clause 2) that in consideration of the respondents’
paying interest on the unpaid purchase price at 22 percent per annum from 27 November, the
payment to be made upon execution of the addendum, the completion dates were extended to 29 January 1990; and the respondents agreed (clause 6) to bear outgoings from 27 November. The
respondents were unable to settle on the due date. The male respondent then told the appellant’s
solicitor to the effect that the respondents wished to complete but were then financially unable to do
so. The appellant purported to rescind.
2 The learned District Court judge found that the contracts as varied were “instalment

contracts” under s.71 of the Property Law Act 1974, because they required the respondents to pay
over the interest earned on the deposits, and interest as the consideration for the extension -
payments without entitlement to conveyance in exchange. Because the thirty day notice under
s.72(1) was not given, the appellant’s purported rescission was of no effect, with the consequence
that the judge entered judgment for the respondents,…

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 Starco Developments Pty Ltd v Ladd

Details

AGLC: Starco Developments Pty Ltd v Ladd [1998] QCA 344
Case: [1998] QCA 344
Decision Date: 30/10/1998

CaseChat Overview and Summary

The case of Starco Developments Pty Ltd v Ladd was heard in a court in Australia. The dispute arose from a contract for the construction of a building, with the central issue being whether the contract was an instalment contract under section 71 of the Property Law Act 1974, and if a default in payment constituted repudiation. The plaintiff, Starco Developments, sought to terminate the contract and claim damages for the defendant, Ladd's, failure to make the agreed payments. The defendant argued that the contract was not an instalment contract and that the plaintiff's actions did not amount to repudiation.

The court had to determine the nature of the contract and whether it fell under section 71 of the Property Law Act 1974, which defines an instalment contract as one where the buyer is to pay the purchase price in instalments and the seller is to perform the contract in corresponding instalments. The court also needed to assess whether a default in making payment by the buyer amounted to a repudiation of the contract, which would entitle the seller to terminate the contract and claim damages. The court examined relevant case law, including Braidwood v Queensland City Properties Ltd, Wacal Developments Pty Ltd v Realty Developments Pty Ltd, Kaneko v Crawford, and Sibbles v Highfern Pty Ltd, to understand the principles governing instalment contracts and the effect of repudiation.

The court concluded that the contract was indeed an instalment contract under section 71 of the Property Law Act 1974, as it involved payments to be made in instalments corresponding to the progress of the construction. The court also found that the default in making the payment amounted to a repudiation of the contract by the buyer, as it demonstrated an unwillingness or inability to perform the contract as agreed. The court relied on the principle that a failure to make an instalment payment, when due, is a repudiation of an instalment contract. Therefore, the plaintiff was entitled to terminate the contract and claim damages.

The court ordered that the contract be terminated and that the plaintiff, Starco Developments, was entitled to recover damages for the defendant, Ladd's, failure to make the agreed payments. The court specified that the damages would be calculated based on the loss directly resulting from the breach of contract. The court also noted that the defendant's repudiation justified the termination and the claim for damages.

Orders