Sterling Estates Development Corporation Pty Ltd v Malouf

NEW SOUTH WALES COURT OF APPEAL

CITATION:      Sterling Estates Development Corporation Pty Limited v Malouf & Anor [2003]  NSWCA 278

FILE NUMBER(S):
41012/02

HEARING DATE(S):               29 August 2003

JUDGMENT DATE: 02/10/2003

PARTIES:
Sterling Estates Development Pty Limited (Appellant)
Sam John Malouf (First Respondent)
Christine Malouf (Second Respondent)

JUDGMENT OF:       Santow JA Tobias JA McColl JA   

LOWER COURT JURISDICTION: Supreme Court

LOWER COURT FILE NUMBER(S):          SC 3128/02

LOWER COURT JUDICIAL OFFICER:     Young CJ in Eq

COUNSEL:
M Cashion SC/S White (Appellant)
M Pesman (Respondents)

SOLICITORS:
Kemp Strang (Appellant)
Patrick Hargraves & Co (Respondents)

CATCHWORDS:
CONTRACT - construction - contract for the construction and sale of an apartment and car space - construction of "Special Faults" clause - D

LEGISLATION CITED:
Public Health Act 1952 (NSW)

DECISION:
1. Appeal allowed.  2. Order that the declarations and orders made by Young CJ in Eq on 24 October 2002 be set aside.  3. Declare that the Notice of Termination dated 3 June 2002 served by the appellant on the respondents in respect of the Contract for the Sale of Land dated 14 February 2000 in relation to Part FI 1/874004 known as Apartment 420 and Carspace 40, The Etage, 2-50 Pyrmont Bridge Road, Camperdown (the "Contract") between the appellant as vendor and the respondents as purchasers was and is valid.  4. Declare that the Contract was validly terminated by the appellant.  5. Order that Caveat registered No. 8684513 be withdrawn by the respondents. 6. Order that the respondents pay the appellant's costs of the proceedings and of this appeal but have a certificate under the Suitors' Fund Act 1951 in respect of the costs of the appeal if qualified.   

JUDGMENT:

IN THE SUPREME COURT  

OF NEW SOUTH WALES
COURT OF APPEAL

CA         41012/02
SC           3128/02

SANTOW JA
TOBIAS JA
McCOLL JA

Thursday, 2 October 2003

STERLING ESTATES DEVELOPMENT CORPORATION PTY LIMITED v
Sam John MALOUF and Christine MALOUF

FACTS

The appellant as vendor and the respondents as purchasers entered into a Contract for the Construction and Sale of an apartment and car space at Camperdown (the "Contract"). The contract provided a procedure for notification by the purchaser of "Special Faults", which were to be repaired by the vendor prior to completion. "Special Fault" was defined in the Contract to mean:

"a fault or defect in the property which:

(a) is structural; or
(b) because of its nature requires urgent attention; or
(c) may cause danger to persons in the property; or
(d) makes the property uninhabitable."

On 14 March 2002, the first respondent, Mr Malouf, sent a letter (the "Special Faults letter") to the appellant identifying a defect said to require rectification prior to settlement, namely a rise in the concrete floor in the lounge room area. On 17 April, the appellant served a Notice to Complete on the respondents requiring completion on or before 3 May 2002. The respondents did not complete relying on the fact that the "Special Fault" had not been rectified. On 3 June 2002 the appellant served a Notice…