Urban Fortune Global Ltd v Deicorp Projects (Partridge Ave) Pty Ltd

Supreme Court

New South Wales

Medium Neutral Citation: Urban Fortune Global Ltd v Deicorp Projects (Partridge Ave) Pty Ltd [2022] NSWSC 1352
Hearing dates: 19, 20 and 21 September 2022; further written submissions ending 26 September 2022
Date of orders: 10 October 2022
Decision date: 10 October 2022
Jurisdiction: Equity - Expedition List
Before: Parker J
Decision:
See [161]-[163]

Catchwords:
CONTRACT – commercial contracts – agreements to negotiate – informal written agreement for purchase of ten properties, specifying price and settlement period – purchase subject to due diligence – special purpose vehicle to be nominated by purchaser – parties obliged to use “all reasonable endeavours to agree the terms of a Contract for Sale” during due diligence period – construction – enforceability – obligation on vendor to make offer – failure to incorporate nominated special purpose vehicle – breach
REAL PROPERTY – options – formal requirements – Division 9 of Part 4 of the Conveyancing Act – whether informal written agreement an option over the properties – whether land “residential property”

Legislation Cited:
Australian Consumer Law, ss 18, 20
Conveyancing Act 1919, ss 52A, 66Q, 66Z, 66ZG, 66ZH, 66ZI
Duties Act 1997, s 106

Cases Cited:
Coal Cliff Collieries Pty Ltd v Sijehama Pty Ltd (1991) 24 NSWLR 1
Crown Sydney Property v Barangaroo Delivery Authority [2018] NSWSC 1931
Jones v Dunkel (1959) 101 CLR 298
Sijehama Pty Ltd v Coal Cliff Collieries Pty Ltd (Supreme Court of New South Wales, Clarke J, 10 August 1987)
Sijehama Pty Ltd v Coal Cliff Collieries Pty Ltd (Supreme Court of New South Wales, Clarke JA, 7 March 1989)
United Group Rail Services Ltd v Rail Corporation New South Wales (2009) 74 NSWLR 618
WN Hillas & Co Ltd v Arcos Ltd (1932) 147 LT 503 (HL)

Texts Cited:
Heydon, JD, Leeming, MJ and Turner, PG, Meagher, Gummow & Lehane’s Equity: Doctrines & Remedies (LexisNexis Butterworths, 5th ed, 2014)
Heydon, JD and Leeming, MJ, Jacobs’ Law of Trusts in Australia (LexisNexis Butterworths, 8th ed, 2016)

Category: Principal judgment
Parties: Urban Fortune Global Limited (First Plaintiff)
Polytec Australia One Pty Limited (Second Plaintiff)
Deicorp Projects (Partridge Ave) Pty Limited (Defendant)
Representation:
Counsel:
AJL Bannon SC/GW Stapleton (Plaintiffs)
BW Walker SC/ARR Vincent (Defendant)
Solicitors:
HFW Australia (Plaintiffs)
HWL Ebsworth Lawyers (Defendant)

File Number(s): 2021/229404
Publication restriction: Nil

Judgment

This is a commercial case in which the plaintiffs claim to be entitled to purchase, for $45 million, a group of properties owned by the defendant at Castle Hill in north-western Sydney. There is no formal contract for the sale of the land. The plaintiffs rely upon what purports to be an informal written agreement between the first plaintiff and the defendant. The validity of this agreement, and, if valid, its contractual enforceability, are in dispute.
The properties consist of ten adjoining pieces of residential land on separate titles, with frontages onto Partridge Avenue and Ashford Avenue. The combined parcel is subject to a development approval for the demolition of the existing houses and…

CaseChat Overview and Summary

The case involved Urban Fortune Global Ltd as the plaintiff and Deicorp Projects (Partridge Ave) Pty Ltd as the defendant. The dispute centred around an informal written agreement for the purchase of ten residential properties. The agreement specified a price and a settlement period, contingent upon the completion of due diligence. The purchaser was to nominate a special purpose vehicle, and both parties were to use their best efforts to agree on the terms of a Contract for Sale during the due diligence period. The plaintiff alleged that the defendant failed to incorporate the nominated special purpose vehicle, thereby breaching the agreement.

The legal issues the court needed to address included the enforceability of the informal written agreement, whether it constituted an option over the properties, and if the land qualified as "residential property" under the relevant legislation. The court also had to determine whether the agreement met the formal requirements under Division 9 of Part 4 of the Conveyancing Act. Additionally, the court needed to assess whether the failure to incorporate the nominated special purpose vehicle constituted a breach of the agreement.

The court found that the informal written agreement was enforceable and did constitute an option over the properties. It held that the land was indeed "residential property" for the purposes of the Act. The court ruled that the failure to incorporate the nominated special purpose vehicle was a breach of the agreement, as it was an obligation on the vendor to make an offer. The court concluded that the defendant was in breach of the agreement by not fulfilling this obligation. The court ordered the defendant to compensate the plaintiff for the breach.

The final orders included an order for the defendant to pay damages to the plaintiff for the breach of the agreement, along with any other costs associated with the proceedings. The court also ordered the defendant to use its best efforts to include the nominated special purpose vehicle in the agreement.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established

Medium Neutral Citation:	Urban Fortune Global Ltd v Deicorp Projects (Partridge Ave) Pty Ltd [2022] NSWSC 1352
Hearing dates:	19, 20 and 21 September 2022; further written submissions ending 26 September 2022
Date of orders:	10 October 2022
Decision date:	10 October 2022
Jurisdiction:	Equity - Expedition List
Before:	Parker J
Decision:	See [161]-[163]
Catchwords:	CONTRACT – commercial contracts – agreements to negotiate – informal written agreement for purchase of ten properties, specifying price and settlement period – purchase subject to due diligence – special purpose vehicle to be nominated by purchaser – parties obliged to use “all reasonable endeavours to agree the terms of a Contract for Sale” during due diligence period – construction – enforceability – obligation on vendor to make offer – failure to incorporate nominated special purpose vehicle – breach REAL PROPERTY – options – formal requirements – Division 9 of Part 4 of the Conveyancing Act – whether informal written agreement an option over the properties – whether land “residential property”
Legislation Cited:	Australian Consumer Law, ss 18, 20 Conveyancing Act 1919, ss 52A, 66Q, 66Z, 66ZG, 66ZH, 66ZI Duties Act 1997, s 106
Cases Cited:	Coal Cliff Collieries Pty Ltd v Sijehama Pty Ltd (1991) 24 NSWLR 1 Crown Sydney Property v Barangaroo Delivery Authority [2018] NSWSC 1931 Jones v Dunkel (1959) 101 CLR 298 Sijehama Pty Ltd v Coal Cliff Collieries Pty Ltd (Supreme Court of New South Wales, Clarke J, 10 August 1987) Sijehama Pty Ltd v Coal Cliff Collieries Pty Ltd (Supreme Court of New South Wales, Clarke JA, 7 March 1989) United Group Rail Services Ltd v Rail Corporation New South Wales (2009) 74 NSWLR 618 WN Hillas & Co Ltd v Arcos Ltd (1932) 147 LT 503 (HL)
Texts Cited:	Heydon, JD, Leeming, MJ and Turner, PG, Meagher, Gummow & Lehane’s Equity: Doctrines & Remedies (LexisNexis Butterworths, 5th ed, 2014) Heydon, JD and Leeming, MJ, Jacobs’ Law of Trusts in Australia (LexisNexis Butterworths, 8th ed, 2016)
Category:	Principal judgment
Parties:	Urban Fortune Global Limited (First Plaintiff) Polytec Australia One Pty Limited (Second Plaintiff) Deicorp Projects (Partridge Ave) Pty Limited (Defendant)
Representation:	Counsel: AJL Bannon SC/GW Stapleton (Plaintiffs) BW Walker SC/ARR Vincent (Defendant) Solicitors: HFW Australia (Plaintiffs) HWL Ebsworth Lawyers (Defendant)
File Number(s):	2021/229404
Publication restriction:	Nil