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Willis v Crosland

Willis v Crosland

Case [2021] VSCA 320 23 November 2021

Contract Formation

Breach of Contract

Repudiation & Termination

Ready, Willing and Able

Termination Clauses

Contract Law

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SUPREME COURT OF VICTORIA

COURT OF APPEAL

S EAPCI 2021 0024

ANNE WILLIS	Applicant
v
LOUISE VANESSA CROSLAND	Respondent

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JUDGES:	SIFRIS, WALKER JJA and MACAULAY AJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	28 October 2021
DATE OF JUDGMENT:	23 November 2021
MEDIUM NEUTRAL CITATION:	[2021] VSCA 320
JUDGMENT APPEALED FROM:	[2020] VCC 1964; [2021] VCC 39 (Judge Macnamara)

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CONTRACT – Sale of land – Clause permitted purchaser to terminate contract if purchaser (a) obtained report which designated current defect in structure on land as ‘major building defect’ (b) gave notice and (c) ‘is not then in default’ – Payment of deposit due at midnight on 18 December 2019 – Purchaser gave notice of termination at 7:51 pm on 18 December 2019 – Purchaser had paid most but not all of deposit – Whether trial judge erred in finding that purchaser was not ‘ready, willing and able’ to perform and so was ‘then in default’ – Purchaser not in actual breach – Whether purchaser was ‘ready, willing and able’ did not affect ability to exercise contractual right – Vendor contended by notice of contention that purchaser repudiated the contract and was ‘then in default’ – Repudiation not sufficiently raised below – New issues raised on appeal – Relevant conduct not repudiatory – Suggested repudiation not accepted before notice of termination – Purchaser was ‘not then in default’ – Vendor contended by notice of contention that report did not provide sufficient basis to terminate contract – Report did provide proper basis – Termination by purchaser valid – Appeal allowed – Notice of contention dismissed.

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APPEARANCES:	Counsel	Solicitors
For the Applicant	Mr P Solomon QC with Mr J McComish	DST Legal
For the Respondent	Mr J Twigg QC with Mr W Newland	Ferdinand Zito & Associates

SIFRIS JA
WALKER JA
MACAULAY AJA:

Introduction

The critical issue for consideration in this application for leave to appeal is whether a notice of termination given by the applicant as the purchaser of a property was a valid and effective termination of the contract of sale. General condition 21 in the contract entitled the purchaser to terminate the contract if the purchaser obtained a building report which disclosed a current defect in a structure on the land and designated it as a ‘major building defect’ (‘Condition 21’). That condition provided that the purchaser could only terminate if the purchaser ‘is not then in default’.

The notice of termination was given at 7:51 pm on 18 December 2019. The time for payment of the deposit was midnight that day. The purchaser had paid most, but not all, of the deposit prior to 7:51 pm. She contended that, at the time of service of the notice, she was ‘not then in default’, because the time for payment had not then arrived. She sued to recover the deposit paid. The vendor contended that the balance of the deposit due ($2,500) could not be paid before midnight and that the purchaser was therefore not ‘ready, willing…

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.

Continue reading Willis v Crosland

Details

AGLC: Willis v Crosland [2021] VSCA 320
Case: [2021] VSCA 320
Decision Date: 23 November 2021

CaseChat Overview and Summary

In Willis v Crosland, the primary dispute was whether the purchaser's attempt to terminate a contract for the sale of land was valid. The contract contained a clause that allowed the purchaser to terminate if certain conditions were met, including obtaining a report identifying a major building defect, giving notice, and not being in default. The purchaser gave notice of termination shortly before the deposit was due, but had not yet fully paid the deposit. The vendor argued that the purchaser was in default because they had not fully paid the deposit. The purchaser claimed they were not in default and had the right to terminate the contract.

The legal issues before the court were whether the purchaser's failure to fully pay the deposit rendered them 'in default', thus invalidating their right to terminate, and whether the vendor had properly raised the issue of the purchaser's repudiation of the contract. The court examined the terms of the contract and the actions of the purchaser, including whether the purchaser had made a clear and unequivocal statement of unwillingness to perform their obligations. The court also considered whether the report provided a sufficient basis for the purchaser to terminate the contract.

The court found that the purchaser's failure to fully pay the deposit did not affect their ability to exercise the contractual right to terminate if they were not in default. The court held that the purchaser was not in actual breach of the contract, and that the vendor's contention regarding the purchaser's repudiation was not sufficiently raised below. The court also determined that the report provided a proper basis for terminating the contract. As a result, the purchaser was deemed 'not then in default' and their notice of termination was valid. The appeal was allowed, and the notice of contention was dismissed.

Orders