Windsurfing International Inc v Sailboards Australia Pty Ltd

[1986] FCA 384

CATCHWORDS

CONTRACT - whether contract of sale - "dutch" auction - competing

bids - whether contract formed on execution of contract and

payment of deposit by highest bidder, or not until exchange of

contracts - objective test of intention of parties

- whether contract enforceable - whether memorandum or

note - solicitor's letter enclosing contract for signature

-

whether solicitor had authority to bind vendor.

Bankruptcy Act 1966 ss.30(1), 134(4).

Conveyancing Act 1919 (NSW) s.54A.

Eccles v . Bryant and Pollock [l9481 1 Ch. 93, Summergreene v.

Parker (1950) 80 C.L.R. 304, Allen v. Carbone (1975) 132 C.L.R.

528, Hooker Industrial Developments Pty Ltd v. Trustees of the

Christian Brothers [l9771 2 N.S.W.L.R. 109, S ) 2 - i m -

52 S.R. (N.S.W.) 207, Summit Properties Pty Ltd v. Comserv

(No. 784) Pty Ltd (1981) 2 B.P.R. 9173, B. Seppelt & Sons Ltd v.

Commissioner for Main Roads (1975) 1 B.P.R. 9147.

Smith v. Webster (1876) 3 Ch. D.49, Daniels v. Trefusis [l9141 1 Ch. 788, North v. Loomes [l9191 1 Ch. 378, Woden Squash Courts

Pty Ltd v. Zero Builders Pty Ltd [l9761 2 N.S.W.L.R. 212.

RE: TERRENCE BYRNE and JEAN OLIVIA BYRNE; EX PARTE: NORCO

CO-OPERATIVE LIMITED. EDWARD MICHAEL RING V.

MICHAEL DAVID FOLEY

& MALAESTATES PTY LTD

No. W167 of 1985

Jackson J.

Sydney

11 September 1986

IN THE FEDERAL COURT OF AUSTRALIA	1 1
GENERAL DIVISION	1
1

BANKRUPTCY DISTRICT OF THE STATE OF j NO. w167 of 1985

.- 1

NEW SOUTH WALES AND 1 1

THE AUSTRALIAN CAPITAL TERRITORY 1

- RE : TERRENCE BYRNE and JEAN OLIVIA BYRNE

Bankrupts

EX PARTE: NORCO CO-OPERATIVE LIMITED

Creditor

BETWEEN : EDWARD MICHAEL RING

Applicant

- AND : MICHAEL DAVID FOLEY

and KIM EDWARDS

First Respondent

MALAESTATES PTY. LTD.

Second Respondent

CORAM :	JACKSON J.
DATE :	11 September 1986

SYDNEY PLACE:

MINUTES OF ORDER

THE COURT ORDERS THAT:

1. It be declared that Malaestates Pty Ltd does not have any

interest, whether legal or equitable, in the property

comprised in Certificates of Title Volume 12513 Folio 126

and Volume 10605 Folio 145 by reason of events on or prior

to 19th April 1986.

2. It be declared that Michael David Foley and Kim Edwards

have an equitable interest in the said property as

purchasers under an agreement for sale made on 19th April

1986 the terms of which are set out in Exhibit 1 in these

proceedings.

NOTE : Settlement and entry of orders is dealt with in

Rule 124 of the Bankruptcy Rules.

IN THE FEDERAL COURT OF AUSTRALIA

1

DIVISION GENERAL ) 1

BANKRUPTCY DISTRICT OF THE STATE OF ) NO. W167 Of 1985

)

AND	WALES	SOUTH	NEW	)
)

THE AUSTRALIAN CAPITAL TERRITORY )

- RE : TERRENCE BYRNE and JEAN OLIVIA BYRNE

Bankrupts

EX PARTE: NORCO CO-OPERATIVE LIMITED

Creditor

BETWEEN : EDWARD MICHAEL RING

Applicant

- AND : MICHAEL DAVID FOLEY and KIM EDWARDS

First Respondent

MALAESTATES PTY. LTD.

Second Respondent

CORAM :	JACKSON J.
DATE :	11 September 1986
PLACE :	SYDNEY

2.

. . REASONS FOR JUDGMENT

JACKSON J.

Terrence Byrne and Jean Olivia Byrne were made

bankrupt on 26th February 1985. The applicant, Edward

Michael Ring, a chartered accountant practising at

Murwillumbah, is their trustee in bankruptcy. The assets of

the bankrupts included a freehold property at North Arm in the

Macksv ille region of New South Wales and the issues which

arise Car determination in these proceedings, in which the

Court is invited to exercise the jurisdiction conferred by

ss -30 ( 1 ) and 1 3 4 ( 4 ) of the Bankruptcy Act 1966, relate to that

property.

The fundamental questions which arise in this regard

are whether events which occurred on 19th April 1986 gave rise

to a contract by the applicant to sell the property to Michael

David Foley and Kim Edwards for a price of $151,000.00 and, if

so, whether the contract is enforceable in the light of s.54A

of the Conveyancing Act 1919. Before I turn to the resolution

of those questions, however, it is necessary to set out some

of the events which preceded those which occurred on 19th

April and I shall state now my findings as to those events.

Mr Foley is a Sydney solicitor who has a property in

the Macksville area. Mr Edwards is a Sydney surgeon. In

January and February 1986 Mr Foley had made enquiries with a

3 .

. . q

view to a possible purchase of the property from the applicant

and had made an offer to Mr Ring to purchase it for a price

which was not acceptable to a meeting of creditors held on

17th February 1986. In the result Mr Ring put the property to

public auction, and the auction was conducted	on 5th April
1986.

At the auction the property was passed in. The only

bidder was Mr Foley (then acting on behalf of himself and Mrs

Edwards) and his bid was $100,000.00. I should add that from

15th April onwards Mrs Edwards was no longer involved and

Mr Foley was acting on behalf of himself and Mr Edwards.

After the date of the auction Mr Foley had some

telephone conversations with Mr Ring and increased his offer

to $110,000.00. Again this was not acceptable. In addition

to Mr Foley, however, other persons became interested in the

property. In particular Leigh Francis Ratcliffe, a Melbourne architect acting on behalf of a company Malaestates Pty Ltd,

was in Macksville on 18th April and made an offer of

$120,000.00 for the property to G.J. Kennedy & Co. Pty

Limited, the real estate agent acting on behalf of the

applicant. Mr Beaney, a director of G.J. Kennedy & Co. Pty

Limited, was the person handling the matter at all material times and Mr Beaney communicated by telephone Mr Ratcliffe's

offer to Mr Ring, who was minded to accept it. Mr Beaney then

took' Mr Ratcliffe and the persons accompanying him to the

4 .

office of Messrs Hughes, Perkins & Co., the solicitors

retained to act on behalf of the applicant, in order for them

to see Mr Locke, a senior associate solicitor of that firm, to discuss the form of contract. Mr Locke was not immediately available and Mr Beaney returned to his own office leaving Mr Ratcliffe and his companions waiting at the solicitors'

office. Shortly after Mr Beaney's return to his office Mr

Foley, who had been in the area for the purpose of a court

case at Coffs Harbour, called in to see him. Mr Beaney told

Mr Foley -L the offer by Mr Ratcliffe's interests and in the

event Mr Foley made'an offer of $125,000.00 for the property.

Mr Beaney telephoned Mr Locke and told him of this fact. Mr

Ratcliffe and his companions then returned to Mr Beaney's

office, and, on being told of Mr Foley's offer, Mr Ratcliffe

complained to Mr Beaney that he "had been gazumped". Mr

Beaney, together with Mr Ratcliffe and, it seems, a Mr Owner,

then went to the office of Hughes, Perkins b Co., and went in

to see Mr Locke in his office. In the presence of those

persons Mr Beaney telephoned Mr Ring and discussed with him

the course that should be followed in relation to the offers.

In relation to the terms of that conversation I am

satisfied that Mr Ring, who was to be on holidays in Victoria

from 19th April for a period of some weeks, made it clear to

Mr Beaney that he wanted to have resolved as expeditiously as

possible the competition between potential purchasers of the

property and that he discussed at some length with Mr Beaney

5 .

the procedure which might be adopted to arrive at that result.

I am satisfied that in the course of the discussion he agreed .

with Mr Beaney's proposal that the possible purchasers (who included other persons in addition to those represented by Messrs Ratcliffe and Foley) should be invited to make offers

in competition with each other up to noon, or shortly after,

the following day. I am also satisfied that in order to

encourage the potential purchasers to participate, Mr Ring

authorized Mr Beaney to tell them that the person who made the

highest offer during the competitive bidding on the next day

and who then forthwith paid a deposit of five per cent of the

offered price and signed a contract to purchase the property

would be the buyer. I am satisfied also that Mr Ring told Mr

Beaney that he (Mr Ring) gave an undertaking to the potential

offerors that he would enter into a contract with that person.

After the conversation between Mr Ring and Mr Beaney

concluded, Mr Ring spoke to Mr Locke and in that conversation Mr Ring told Mr Locke that whoever made the highest offer,

paid the five per cent deposit and signed the contract would

be the purchaser and that there would be	no further
negotiations.

I am satisfied also that Mr Ring stated to both Mr Beaney and to Mr Locke that he would leave it to Mr Beaney to

arrange details of the procedure which was to be carried out

the'next day and that Mr Ring told Mr Locke that his firm was

6.

to act on Mr Ring's behalf in the matter.

After those conversations Mr Beaney spoke to Mr Foley

and other persons who had expressed an interest in the

property and informed them of the method of sale which he had

discussed with Mr Ring. In particular, as I find, he told Mr

Foley that the procedure to be adopted the next day was not to

be construed as an "ordinary" auction sale because Mr Ring had

not advertised the sale and was concerned about possible

criticism for not having done so, and for that reason Mr

Beaney was not to sign the contract on Mr Ring's behalf.

On the next day at noon the interested persons were

in Mr Beaney's office and the persons present included Mr

Ratcliffe and Mr Foley. I am satisfied that Mr Beaney, as he

said in evidence, made it plain to the persons assembled in

his office - as Mr Ring had authorized him to do - that the

person who made the highest offer and who signed the form of

contract and who paid the five percent deposit "would be the

successful buyer of the property". I am satisfied also that

he told the persons present that Mr Ring	had given an
undertaking to that effect.

Offers were then called for, and "bidding" proceeded.

Mr Foley's offer of $151,000.00 was the highest. Mr Foley

then signed a form of contract which was provided to him and

-

paid the five per cent deposit. A copy of the contract signed

7 .

by Mr Foley was sent to Mr Ring but Mr Ring has declined to

sign the contract. He has subsequently invited tenders for

the property and Malaestates Pty Ltd was the successful

tenderer, subject to the resolution of the question whether Mr

Foley and Mr Edwards have a prior enforceable contract to purchase the property.

I turn then to consider the particular matters on

which the Court's opinion is sought. They are set out in

5

paragraphs 2 to 7 of the Application as follows:-

" 2 . A declaration as to whether Malaestates Pty

Limited (hereinafter called "Malaestates") has a legal or equitable interest in the whole of the land comprised in Certificate of Title Volume 12513 Folio

126 and Volume 10605 Folio 145 (hereinafter called

"the property") pursuant to or as an incident of

dicussions that took place between Mr Ratcliffe,

apparently an officer of Malaestates, Mr Locke the

solicitor then acting for the AppTicant, Mr Beaney,

the real estate agent acting for the Applicant and

the Applicant.

3 . A declaration as to whether Michael Foley and Kim

Edwards (hereinafter called "the claimants") or

either one of them have a legal or equitable interest

in the whole of the land comprised in Certificates of

Title Volume 12513 Folio 126 and Volume 10605 Folio

145 (hereinafter called "the property") pursuant to

or as an incident of an Agreement for Sale of Land

(hereinafter called "the Agreement") signed by the

said Michael Foley on his own behalf and on behalf of

Kim Edwards delivered to Mr John Beaney the real

estate agent of the applicant together with a deposit

of $7,550.00 on Saturday 19th April, 1986.

4. If the answer to Paragraph 3 hereof is "yes", a

declaration as to whether the claimants or either of

them have such an interest as would, subject to

Paragraph 5 hereof, entitle them to an order for specific performance against the Applicant to enter

- into the Agreement.

5. If the answer to Paragraphs 3 or 4 or either of

8.

them is "yes" a declaration as to the date upon which

the Agreement was entered into or whether the

Agreement would be entered into	on the date upon
which it would be exchanged.

6. In the alternative to Paragraphs 2 to 4 hereof

inclusive, a declaration as to whether the claimants

or either of them have entered into a contract with

the Applicant to enter into a contract containing the

terms and conditions of the Agreement.

7 . If the answer to any of the preceding Paragraphs

is or would result in the Agreement or a contract

containing the terms, conditions and warranties of

the Agreement being entered into on or after 1st May,

1968, declarations that it would be a hardship, in

all the circumstances, to require the Applicant to

specif;-ally perform the Agreement or any such

contract as varied by the warranties and other

requirsments imported into the contract by Section

52A of the New South Wales Conveyancing Act, 1919 as

amended and the Conveyancing (Vendor Disclosure and

Warranty) Regulation, 1986."

Paragraph 2 of the Application relates to a

suggestion raised at an earlier point that by events which

occurred prior to 19th April Malaestates had entered into an

agreement to purchase the property. Malaestates does not now

contend that it acquired any interest in the land other than

in consequence of acceptance of its tender at a later time and

I shall simply declare that Malaestates does not have a legal

or equitable interest in the property by reason of events	on
or prior to 19th April 1986.

I turn then to paragraph 3 which gives rise to the

fundamental questions in these proceedings, the first such

question being whether the events of 19th April gave rise to a

contract between Mr Ring as trustee on the one hand, and

9.

Messrs Foley and Edwards on the other.

The competing contentions are, on behalf of Mr Foley

and Mr Edwards, that a concluded agreement was arrived at upon

the execution by Mr Foley on behalf of himself and Mr Edwards,

of the form of the contract which he signed and on payment of

the deposit and, on behalf of Mr Ring and Malaestates, that no

contract was to be entered into until there had been an

exchange of contracts, i.e. until Mr Ring had executed his

copy of the agreement and sent that copy to the purchaser.

In resolving the competing contentions it is

convenient to refer first to three specific matters to which

reference was made by counsel for Malaestates Pty Ltd as

matters which should lead to the view that there was to be no

contract until there was an exchange of contracts.

The first such matter is that in New South Wales the

common method of entering into contracts for sale of land is

not by vendor and purchaser executing one document which is

the contract of sale, but rather by the purchaser signing the

copy (the "counterpart") of such a document, and the vendor

the original, with the contract coming into existence when the

copies are exchanged. In such a context and particularly (as

was said to be the case here) where there is a reference to "exchange of contracts" in the negotiations, the following

observations of Lord Greene M.R. in Eccles v. Bryant and

10.

Pollock I19481 1 Ch. 93 at 99 will apply:-

"When parties are proposing to enter into a contract,

the manner in which the contract is to be created so

as to bind them must be gathered from the intentions

of the parties express or implied. In such a

contract as this, there is a well-known, common and

customary method of dealing: namely, by exchange, and anyone who contemplates that method of dealing cannot contemplate the coming into existence of a binding

contract before the exchange takes place."

See too Summergreene v. Parker (1950) 80 C.L.R. 304 at 321,

Allen v. Carbone (1975) 132 C.L.R. 528 at 533, Hooker

Industrial Developments Pty Ltd v. Trustees of the Christian

Brothers I19771 2 N.S.W.L.R. 109 at 118, Smith V. - Lush (1952)

52 S.R. (N.S.W.) 207, Summit Properties Pty Ltd v. Comserv (No. 784)

Pty Ltd (1981) 2 B.P.R. 9173 and B. Seppelt & Sons Ltd v.

Commissioner for Main Roads (1975) 1 B.P.R. 9147.

It was said that the case was one to which the observations

, of Lord Greene M.R. were directly applicable because Mr Beaney had

made it clear to all potential purchasers on 19th April that there

would have to be an exchange of contracts, and that normal

conveyancing procedures were to be followed. The evidence of Mr

Foley was to the contrary, however, and on this issue I prefer Mr

Foley's evidence that the topic of exchanging contracts or of

following normal conveyancing procedures was not mentioned to him or

discussed by him prior to his signing the form of contract and

paying the deposit on 19th April.

-

The second specific matter on which reliance was placed was

11.

._

that Mr Beaney had told the persons present at his office on 19th

April that the proceedings were not to be an "auction sale as such"

and that Mr Beaney had "no power to sign the contract on behalf of"

Mr Ring. It was urged that these statements showed that although Mr

Ring had told Mr Beaney that he would contract with the highest

bidder on the 19th who signed the contract and paid the deposit, he

would not be bound until he himself had signed the contract.

Although I think that the expressions of Mr Beaney to which

I have referred , if taken in isolation, might lead to the view that there was not to be a contract until, at the earliest, execution of

a copy of the contract by the vendor, I do not think that they

should be so treated in the present context. I think that Mr Beaney was concerned to state that the proceedings were not an auction "as such" because he wanted to make it clear that the highest bidder

would not become the purchaser "on the fall of the hammer" but only

after signing the contract and paying the deposit and in order to

protect Mr Ring from possible criticism for failure to advertise the

sale. I think also that Mr Beaney in saying that he had not

authority to sign the contract was indicating again that the procedure to be followed was not that of a normal public auction, when the auctioneer would ordinarily have authority to execute on

behalf of the vendor a memorandum of the agreement arrived at with

the highest bidder. In the circumstances I do not consider that Mr

Beaney's statement on the 19th altered the position from that which he had communicated to Mr Poley on the previous evening.

12.

l

The third matter is the fact that the form of contract

actu ,ally executed by Mr Foley was altered slightly by him prior to

execution. The contract had originally been prepared, as I find, by

Hughes, Perkins & Co. on Mr Ring's instructions for the auction on

5th April and Mr Foley added to the description of the improvements

the words " & cottage" following the existing words "Farm

improvements". Mr Ring had left it to his solicitors to prepare a

form of contract suitable to the occasion on the 19th and I do not

think that their authority, or that of Mr Beaney, was limited to

obtaining the signature of the highest offeror-to a contract which

was in exactly the same form as that which they had prepared for the

earlier unsuccessful auction.

The ultimate question which remains, however, is whether,

applying an objective test, it was the intention of the parties that

a contract be made upon the execution of the contract and the

payment of the five per cent deposit by the highest bidder on 19th

April.

In my view it was the intention of the parties that a

contract would result at that time, and there are several features

which lead me to that view.

In the first place I am satisfied that Mr Beaney

communicated accurately to potential bidders what he had been told

by Mr Ring, and his conversation with Mr Ring took place in the

presence of Mr Ratcliffe and Mr Owner. Those gentlemen raised

13.

."

specifically the questions whether the deposit required would be

five per cent rather than ten, and also "that if they happened to

have been the successful, or the highest offer made, that the

contract would go to them. They wanted to make sure that there

would not be any further gazumping as they put it." It seems

unlikely that they would readily have assented, without objection,

to a procedure which would result in Mr Ring having the opportunity,

after 19th April, to receive other bids against them or to seek to

get them to increase their bids further. That view is supported by

the fact that after it became apparent on 19th April that Mr Foley's

offer was the highest, Mr Ratcliffe said that his party would not

leave until they had seen Mr Foley "sign the contract and pay the

money".

As I have said above, however, the question is ultimately

one of determining what was the intention of the parties. The

circumstances were admittedly not the - norm and all parties wanted to

bring the matter to a conclusion. I am satisfied that, in order to

seek to get the highest price for the property Mr Ring instructed Mr

Beaney to inform potential purchasers, and Mr Beaney did so inform

potential purchasers, that	he would contract with the highest
"bidder" on the 19th April	who paid the deposit and signed the

contract. I am satisfied that Mr Ring intended to bind himself

contractually on the happening of the last of those events, and that

that intention was communicated to and understood by Mr Ratcliffe

and Mr Foley prior to the commencement of bidding on the day. It

seems to me that the fact that it was contemplated that Mr Ring

14.

would sign a copy of the contract does not mean that the undertaking

.

which-he-gave-was to be treated as illusory, or binding in honour

only. As a matter of practicality a purchaser would want a copy of

the contract signed by the vendor.

The question which then arises is whether the contract is enforceable, reliance being placed on s.54A(1) of the Conveyancing

Act 1919 which provides that:-

"(l) No action or proceedings may be brought upon any

contract for the sale or other disposition of land or

any interest in land, unless the agreement upon which

such action or proceedings is brought, or some

memorandum or npte thereof, is in writing, and signed

by the party to be charged or by some other person

thereunto by him lawfully authorized.w

The contract, of course, has not been signed by Mr

Ring and the only document which might constitute a "memorandum or note" in terms of s.54A(1) is Exhibit 1 , a

letter dated 22nd April 1986 from Hughes, Perkins & Co. to Mr

Ring addressed to him at his daughter's home in Victoria where

he was on holidays.	The letter encloses the original contract
and says:-

"RE: BYRNE - BANKRUPTCY AND SALE TO FOLEY & EDWARDS

Enclosed plese (sic) find original contract herein

for signature by you as vendor. We would be grateful

if you would also sign at the bottom of the page of

special conditions and return the contract to us at

your earliest possible convenience."

Assuming, as it is necessary to assume for these

purposes, that a concluded agreement had been arrived at

15.

before Exhibit 1 was sent, it is clear that the letter, when

read with the contract for signature, sets out all the terms

of the agreement. The argument, however, is that the

solicitors had no authority to bind the applicant by any such

memorandum, reliance being placed on Smith v. Webster (1876) 3

Ch.D. 49. In that case it was held that a letter forwarding a

draft contract where a matter was subject to negotiation,

could not amount to a memorandum for the purposes of the

statute. In the present case, however, an agreement was

already arrived at and the solicitors had express authority to

send the contract to Mr Ring. The case is thus one to which

the principle in Daniels v. Trefusis 119141 1 Ch. 788 is more

appropriate. There Sargant 3. said at 798-799:-

"The second objection is more formidable and is

supported at first sight by the well-known case of Smith v. Webster. But when that case is carefully

examined, both on its own facts and in the liaht of

the two subsequent cases of Jones v. Victoria-Graving

Dock Co. and John Griffiths Cycle Corporation v.

Humber & Co. (a case which was reversed In the House

of Lords on entirely different grounds), it becomes

apparent that the present case is not within it.

Smith v. Webster really decided that the authority of

a solicitor to prepare a draft contract did not

include, and indeed was inconsistent with, an

authority to state, in a binding form and so as to

constitute a contract, the rough heads of information

which had been given by the client to the solicitor

as material on which to draw the formal contract.

But here the authority was not a general authority at

all, but an authority to forward to the plaintiff's

advisers certain particular documents. And although

the defendant may not have been contemplating that

those documents would form a note or memorandum of

the contract sufficient to satisy the Statute of

Frauds (indeed nothing could have been further from

his thoughts), that did not in my judgment invalidate

the authority to forward the documents, or prevent

all those legal consequences flowing from the

forwarding which would undoubtedly have flowed from

_.

16.

it had the defendant forwarded the statements himself

and signed the letters enclosing them. It seems to

me that the unintentional by-product of satisfying

the Statute of Frauds may be produced as completely

by a note or memorandum signed by an agent of the

party as by a note or memorandum signed by the party

himself, provided, of course, that the agent had

authority to sign the particular note or memorandum.

Mr Martelli indeed urged that Messrs Taylor h Co. had

no authority to sign the letters enclosing the two

statements, since they might have been sent without

any accompanying letter or signature. But I do not

think that this argument is sound in a case like the

present, where the normal and usual method of

communicating the two statements was adopted, namely,

by means of the post and by enclosing them in letters

referring to or indicating the enclosures. I am

therefore of opinion that the letters and statements

in question are sufficient to satisfy the statute.”

See too North v. Loomes I19191 1 Ch. 378 at 383 and Woden

Squash Courts Pty Ltd v. Zero Builders	Pty Ltd [l9761 2
N.S.W.L.R. 212 at 220.

I am thus satisfied that there is a memorandum or

note satisfying s.54A(1) and it is unnecessary in the light of

those views to deal with the other issues relating to s.54A

which were raised before me.

It follows that I should declare in relation to

paragraph 3 of the application that Messrs Foley and Edwards

have an equitable interest in the property pursuant to an

agreement for sale entered into between them as purchasers and

the applicant as trustee on 19th April 1986. It was not

suggested that if I were to answer paragraph 3 in that way,

there was any reason why Messrs Foley and Edwards were not

17.

. ..

entitled to specific performance of the agreement, and it is

not necessary to make any declaration in relation to paragraph

4 . In relation to paragraph 5 it follows from the views I

have taken earlier that the contract was entered into	on 19th
April 1986.

It is unnecessary to answer paragraph 6 and it is

agreed by the parties that it is unnecessary to answer

paragraph 7 if I am of the view that a contract was entered

into prior to 1st May 1986.

The orders which I shall make are as follows:-

1. I declare that Malaestates Pty Ltd does not have

any interest, whether legal or equitable, in the

property comprised in Certificates of Title Volume

12513 Folio 126 and Volume 10605 Folio 145 by reason

of events on or prior to 19th April 1986.

2. I declare that Michael David Foley and Kim

Edwards have an equitable interest in the said

property as purchasers under an agreement for sale

made on 19th April 1986 the terms of which are set

out in Exhibit 1 in these proceedings.

- I shall hear the parties as to the costs of the proceedings.

18.

I certify that this and the 17

preceding pages are a true copy of the his Honour Mr Justice Jackson.

Associate:

Date: 11 September 1986

Solicitor for the applicant: Mr P.M.Fordyce of Messrs P.A. Somerset & Co.

Counsel for the first respondent:	Mr R,M. Smith
Solicitors for the first
respondent:	Foleys
Counsel for the second respondent:	Mr N.C. Hutley
Solicitors for the second
respondent:	Martin h Martin, Melbourne
Dates of hearing:	6 r 7 August 1986