Wendt v Bruce

The plaintiff, William Herbert Bruce, sought specific performance of a contract for the sale of a farm to the defendant, Johann Wilhelm Wendt. The contract, entered into on 9 November 1926, stipulated a completion date of 1 March 1928. A simultaneous share-farming agreement allowed the defendant to possess and farm part of the land during 1927, with the right to fallow another portion after taking possession as purchaser on 1 March 1928. The plaintiff failed to provide clear title by the agreed completion date. On 15 October 1928, the defendant issued a notice making time of the essence and fixing 5 November 1928 as the new completion date, threatening to treat the contract as at an end if the plaintiff defaulted. The plaintiff was ready to settle on 12 December 1928. The defendant remained in possession of the land and harvested a crop sown in 1928. The trial judge found no agreement existed for the defendant to remain in possession to harvest the crop, yet decreed specific performance, a decision affirmed by the Full Court of the Supreme Court of South Australia.

The High Court was required to determine whether the defendant, by remaining in possession of the land and harvesting the crop after the date fixed by his notice, had elected to affirm the contract, thereby precluding him from relying on the plaintiff's failure to complete by that date. The court also considered the reasonableness of the notice period provided by the defendant.

A majority of the High Court held that the defendant's conduct in remaining in possession of the land and harvesting the crop constituted an election to affirm the contract. The legal principle applied was that a party cannot selectively adopt parts of a contract that are beneficial while rejecting those that are disadvantageous; they must either affirm or disaffirm the contract entirely. By continuing to occupy and benefit from the land and its produce, the defendant acted in a manner inconsistent with treating the contract as terminated. This conduct was deemed an unequivocal act demonstrating an intention to keep the contract on foot, thereby waiving any right to rely on the plaintiff's breach of the notice.

The appeal was dismissed, with the majority affirming the decision of the Supreme Court of South Australia. The court found that the defendant's actions amounted to an election to affirm the contract, and therefore, he was precluded from repudiating it based on the plaintiff's failure to meet the deadline set in the notice. The question of the reasonableness of the notice was considered secondary to the finding of election.