Tran v Rich

In *Tran v Rich* [1997] NSWCA 322, the New South Wales Court of Appeal considered a dispute between the appellant, Mr. Tran, and the respondent, Mr. Rich, concerning a contract for the sale of a business. The core of the disagreement revolved around whether the respondent had breached the contract by failing to complete the sale within the agreed timeframe.

The Court of Appeal was required to determine whether the respondent's failure to complete the purchase of the business by the stipulated date constituted a repudiatory breach of the contract, thereby entitling the appellant to terminate the agreement and claim damages. A key issue was whether time was of the essence in the contract, and if so, whether the respondent's delay amounted to such a breach.

The Court found that the contract did not expressly make time of the essence. However, it held that the respondent's conduct, particularly his prolonged and unexplained delay in completing the purchase, amounted to a repudiatory breach of the contract. The Court applied the principle that a party's persistent and unjustified failure to perform a fundamental obligation under a contract can be treated as a repudiation, even if time is not of the essence. This entitled the appellant to accept the repudiation and terminate the contract.

The Court of Appeal allowed the appeal, setting aside the trial judge's decision and ordering that the contract be terminated. The matter was remitted to the Supreme Court for the assessment of damages.