Vendor and Purchaser—Contract of sale of land—Certainty—Purchaser's covenant to grant lease to third party supplier of petroleum products "upon such reasonable terms as commonly govern such a lease"—No evidence concerning terms of lease in common use—Term of lease and rent not specified—Whether such covenant, void for uncertainty, severable. Practice (Vict.)—Supreme Court—Interest on judgment—To be allowed "upon application" at hearing—What constitutes application—Supreme Court Act 1958 (Vict.), s. 78 (1)* (as amended by Supreme Court (Interest on Judgments) Act 1962 (Vict.), s. 2).
Decisions
October 31. The following written judgments were delivered:- McTIERNAN J. These appeals are from the Full Court of the Supreme Court of Victoria. (at p450)
2. The appellant in the first appeal was the defendant in an action in which the respondent as plaintiff sought to make him liable to pay back 15,600 pounds ($31,200) which was part of the deposit which the plaintiff had paid on a sale and purchase of land. The plaintiff was the purchaser and the defendant was the vendor. The action was dismissed. On appeal by the plaintiff the Full Court made an order that judgment be entered for the plaintiff. The amount of the judgment is $31,200. In a cross appeal and in the second appeal the plaintiff complains that the Full Court made no order for the payment of interest. (at p450)
3. As a result of negotiations which Brew commenced, Whitlock agreed to sell and Brew agreed to purchase an area of land at Brighton Beach, Victoria, for the price of 165,000 pounds . A contract of sale was drawn up and Whitlock and Brew signed it. (at p451)
4. The part of the contract headed "Terms and conditions of sale" provided as follows :
"The purchaser shall pay a deposit of 16,500 pounds of which 100 pounds shall be paid on or before the signing hereof and 16,400 pounds within fourteen days from the date hereof and shall pay the residue of the purchase money as follows : - (a) 39,500 pounds within forty-five days from the date hereof, and (b) the balance, namely, 109,000 pounds within twenty years from the date hereof."
Clause 5, one of the "special conditions" of the contract, reads thus :
"Portion of the land sold is used for the sale of petroleum, oils and greases and petroleum products of the Shell Co. of Australia Limited. The purchaser covenants that he will immediately upon taking possession hereunder grant a lease of that portion of the land sold as is now used for the sale of the abovementioned products to the Shell Co. of Australia Limited upon terms that the said land leased as aforesaid be used by Shell or their sub-tenant or licensee for the sale of such products and upon such reasonable terms as commonly govern such a lease. In the event of any dispute between the…
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.
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Details
AGLC
Whitlock v Brew [1968] HCA 71
Case
[1968] HCA 71
Decision Date
CaseChat Overview and Summary
The High Court of Australia heard an appeal in *Whitlock v Brew*, concerning a dispute over a contract for the sale of land. The appellant, Whitlock, sought to recover a deposit paid by the respondent, Brew, under a contract for the sale of a service station and associated land. Brew had purported to terminate the contract, and Whitlock sought to retain the deposit.
The central legal issue before the Court was whether the contract was void for uncertainty, specifically concerning the clause that stipulated the purchaser would lease the service station back to the vendor at a rental to be agreed upon between the parties. The Court was required to determine if this clause created a binding obligation or merely an agreement to agree, and if the latter, whether it rendered the entire contract unenforceable.
The High Court held that the clause relating to the leaseback was void for uncertainty because it failed to establish a concluded agreement on a fundamental term, namely the rent. However, the Court further considered whether this uncertainty vitiated the entire contract. Applying principles of severability, the Court determined that the leaseback provision was an essential part of the overall transaction and not merely an ancillary term. As such, its invalidity meant that there was no binding contract for the sale of the land. The Court therefore found in favour of the respondent, Brew.