WOHB Pty Ltd v Williams

Case [2024] QDC 94

DISTRICT COURT OF QUEENSLAND

CITATION:

WOHB Pty Ltd v Williams & Anor [2024] QDC 94

PARTIES:

WOHB PTY LTD

(ACN 624 271 969)
(plaintiff)
v
JUSTIN GREGORY WILLIAMS AS TRUSTEE OF THE WILLIAMS FAMILY TRUST
(first defendant)
and

ANITA MARIA NIVALA AS TRUSTEE OF THE WILLIAMS FAMILY TRUST
(second defendant)

FILE NO:

1380/19

DIVISION:

Trial

PROCEEDING:

Civil

ORIGINATING COURT:

District Court, Brisbane

DELIVERED ON:

20 June 2024

DELIVERED AT:

Brisbane

HEARING DATE:

27-29 February, 8 March 2024

JUDGE:

Dearden DCJ

ORDER:

(1)   The plaintiff’s application to amend the Claim, and FASOC, is refused.

(2)   The plaintiff’s claim is dismissed.

(3)   The first and second defendants’ counterclaim against the plaintiff be allowed. The plaintiff to pay the first and second defendants the sum of $24,030.93.

CATCHWORDS:

CONTRACTS – Option agreement – whether the option period was five or six months – whether a previous agreement continued to have any effect on a later and formally executed option agreement – whether the plaintiff was induced to enter into the option agreement by a fraudulent or negligent misrepresentation – whether a condition precedent existed – whether rectification is open to change the option period from five months to six months due to mistake – whether the defendants repudiated the option agreement

COUNTER CLAIM – whether the plaintiff failed to complete works carried out on the subject property in accordance with the option agreement – whether the plaintiff failed to provide documents and information relating to that work in accordance with the option agreement – whether the plaintiffs are in breach of the option agreement

LEGISLATION:

Competition and Consumer Law Act 2010 (Cth) sch 2 Australian Consumer Law s 18

Trusts Act 1973 (Qld) s 15

Uniform Civil Procedure Rules 1999 (Qld) r 166(1)

CASES:

Electricity Generation Corporation t/as Verve Energy v Woodside Energy Ltd (2014) 251 CLR 640

Masters v Cameron (1954) 91 CLR 353

G R Securities Pty Ltd v Baulkham Hills Private Hospital Pty Ltd (1986) 40 NSWLR 631

Macks v Viscariello (2017) 130 SASR 1

O’Brien v Smolonogov (1983) 53 ALR 107

BP Refinery Pty Ltd v Hastings Shire Council (1977) 52 ALJR 20

Secured Income Real Estate (Aust) Ltd v St Martins Investments Pty Ltd (1979) 144 CLR 596
COUNSEL:

S Fisher for the plaintiff

R Ivessa for the first and second defendants
SOLICITORS:

Stolar Law for the plaintiff

Mullins Lawyers for the first and second defendants

Introduction

  1. The plaintiff WOHB Pty Ltd (through its director Mitchell McIlwain) and the first defendant Justin Gregory Williams (as trustee of The Williams Family Trust) entered into an option agreement on 23 March 2018 in respect of a block of land at 62 Rodney Street, Wynnum configured as two lots. The plaintiff purchaser had five months from the date of the agreement to exercise the option to purchase the property either directly or by nomination and purported to exercise the option by nomination after that five month option period had expired. The plaintiff’s Further Amended Statement of Claim seeks damages on the…

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AGLC
WOHB Pty Ltd v Williams [2024] QDC 94
Case
[2024] QDC 94
Decision Date

CaseChat Overview and Summary

The case of WOHB Pty Ltd v Williams involves a dispute between the plaintiff, a property development company, and the defendants, Justin Williams and the Williams Family Trust. The central issue revolves around an option agreement for a property located at 62 Rodney Street, Wynnum, where the plaintiff had an option to purchase the property for $500,000, subject to certain conditions. The primary legal issues addressed by the court included whether the option period was five or six months, the impact of a previous agreement on the formally executed option agreement, whether the plaintiff was induced into the option agreement by fraudulent or negligent misrepresentation, and whether there was a condition precedent for the exercise of the option. Additionally, the court considered whether rectification of the option agreement to change the option period from five months to six months was permissible due to a mistake, and if the defendants had repudiated the option agreement.

The court concluded that the option period was five months, as evidenced by the email communication from the first defendant to Maude Thompson of Purplebricks on 27 February 2018. The court found that the previous handwritten agreement did not continue to have any effect on the later and formally executed option agreement. It was determined that the plaintiff was not induced into the option agreement by any fraudulent or negligent misrepresentation. Furthermore, the court held that there was no condition precedent to the exercise of the option, and rectification to change the option period from five months to six months was not available due to the nature of the mistake. The court found that the defendants had not repudiated the option agreement.

Regarding the counterclaim, the court found that the plaintiff had failed to complete the necessary works on the property in accordance with the option agreement and had also failed to provide documents and information relating to the work in accordance with the agreement. Consequently, the court found that the plaintiff was in breach of the option agreement, and the counterclaim was allowed. The plaintiff was ordered to pay the first and second defendants the sum of $24,030.93.

Orders

Orders of the court

(1) The plaintiff’s application to amend the Claim, and FASOC, is refused.

(2) The plaintiff’s claim is dismissed.

(3) The first and second defendants’ counterclaim against the plaintiff be allowed. The plaintiff to pay the first and second defendants the sum of $24,030.93.

Background

Background to the litigation

TB: Trial Bundle.The facts It is convenient at the outset to traverse the facts, which are relatively brief and straightforward. All findings of fact, where contested, are in accordance with the civil standard (balance of probabilities). Mitchell Robert McIlwain, director of the plaintiff company, together with his father Graeme McIlwain, in late January 2018, arranged to physically inspect a property at 62 Rodney Street, Wynnum which they found on an ad on realestate.com.[1][1]T1-29. On 10 February 2018 Mitchell McIlwain, Graeme McIlwain, Maude Thompson from real estate agency, Purplebricks, and Justin Williams (first defendant) met at 62 Rodney Street, Wynnum. While sitting on the carpet (there was no furniture in the house at the time), a handwritten agreement was drawn up by Ms Thompson, then signed by Mitchell McIlwain on behalf of the purchaser WOHB Pty Ltd and by Justin Williams as trustee for the Williams Family Trust.[2][2]1-33 – 1-40 (Mitchell McIlwain); 2-7 – 2-8 (Graeme McIlwain); 2-18 – 2-19 (Maude Thompson); 2-45 – 2-46 (Justin Williams). The operative terms of that brief handwritten agreement are as follows:-“Dated 10.2.18Call option premium:$100,000 (non-refundable)Exercise price $500,000Total if exercised $600,000Exercise date: six months from 10/2/2017 (or confirmed execution)Call option premium: paid upon contract executionSeller: Justin Williams as trustee for the William [sic] Family TrustBuyer: WOHB Pty Ltd/Mitchell Robert McIlwain – DirectorOffer: Seller has (???) no liability for cost of buyer developingBuyer shall develop the site with no cost or liability to the sellerBuyer shall pay all costs of approval and otherwiseBuyer & Seller to finalise ASAPTarget execution: 16th February 2017 [sic]Subject: subject to agreement on final form agreementSeller: Justin Williams ATF WFTPurchaser: WOHB Pty LtdReceived sum of $100 as initial deposit”[3][3]Exhibit 1 – TB 146; T1-34-1-40. On 27 February 2018, Maude Thompson from Purplebricks forwarded an email received from the first defendant which in turn attached an option agreement and associated documentation (the sales contract that would apply if the option was exercised).[4] Relevantly, in that email chain, the email from the first defendant to Maude Thompson of 27 February 2018 contains this paragraph:“The term of the option is five months because the other side has one month to get their deal in order to move forward. If they declare the option at five months but don’t want to go through with it by the sixth month mark the construction of the agreement permits such. This means that from their side they just declare the option at five months no matter what knowing they have a month to get out of it they want.”[4]Exhibit 1 – TB 149-184. Further in the same email there is this paragraph: “Let them know I don’t want much argy bargy on this agreement as there is other interest in the property and this captures very well what both parties have sought. The five-month v six-month thing may seem odd at first but the lawyers tell me this is pretty much how it is done as it gives the other side one month to get their own sales contracts in place within the term of the option period.”[5] [5]Exhibit 1 – TB 150; T1-41-1-42.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Accordingly, the application to amend the Claim and FASOC, is refused. Conclusion The inevitable conclusion is that the plaintiff’s case has completely failed. Accordingly, the plaintiff’s claim should be dismissed.Counterclaim The defendants in their counterclaim assert that after the plaintiff requested, and the defendants granted consent for the plaintiff to demolish the house on the property and reconfigure sewerage and power, in about April 2018, the plaintiff disconnected but did not complete works necessary to reconnect the sewerage and power.[107][107]FAC [9]-[12]. Option Agreement clauses 16.1, 16.3, 16.6, 16.7 and 16.9 provide:Clause 16.1 “The Seller grants the Buyer and its officers, consultants, servants, workmen and agents unrestricted access to the Property for the purpose of carrying out inspections, investigations, surveys, tests and to develop the Property (including but not limited to earthworks and operational works on the Property) at the Buyers cost. The Buyer agrees to indemnify the Seller from and against all actions, costs, claims, proceedings and demands that the Seller may suffer or incur as a result of the Buyer being afforded access to the Property in accordance with the provisions of this clause. The Buyer must obtain and keep in full effect in the name of the Buyer, any [sic] noting the interests of the Seller, any insurances over the Property that are reasonable required by the Seller, including but not limited to contractor’s all risk insurance and public liability insurance with limits of not less than $10,000,000 per occurrence. All insurance policies required by this clause will be taken out with insurers acceptable to the Seller and on policies and in forms satisfactory to the Seller. The Buyer must supply the Seller with copies of the certificates of currency of each insurance policy taken out in accordance with this clause. The Buyer must provide these certificates of currency to the Seller before any access is granted. The Seller must act reasonable in this regard.”Clause 16.3 “The Seller shall promptly:(a) Sign (as registered owner of the Property) all development applications that the Buyer may wish to make in respect of the Property;(b) Sign all consents and other documents required to enable the Buyer to complete, lodge and pursue its proposed development within a reasonable time of being requested to do so by or on behalf of the Buyer including but not limited to:i.Owner’s consent for power abolishment;ii.Owner’s consent for Queensland Urban Utilities for Water and Sewerage connections; andiii.Owner’s consent for IDAS Form 1 for the Demolition Approval Application.”Clause 16.6 “The Buyer must ensure that any work undertaken in developing the property needs to be completed in full (including removal of any rubbish) to the standards as defined in the Queensland Building and Constructions Commission Act 1991 and in accordance with any approvals required by relevant authorities.”Clause 16.7 “In the event that the Buyer does not exercise the Call Option within the Option Period, the Buyer must provide the Seller with any and all information relating to the work undertaken (including but not limited to drawings, plans, approvals etc) within a reasonable time from the expiry of the Option Period and assigns all interest and rights to these to the Seller.”Clause 16.9 “The Buyer will obtain written consent of the Seller prior to undertaking any works on the Property (including but not limited to the demolition of the house of the Property), which consent shall not be unreasonably withheld.”

Ratio Decidendi

Legal Principle Established

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