New South Wales
Court of Appeal
CITATION: World Best Holdings Limited v Sarker [2010] NSWCA 24
This decision has been amended. Please see the end of the judgment for a list of the amendments.HEARING DATE(S): 25/02/2010
JUDGMENT DATE:
15 April 2010JUDGMENT OF: Tobias JA at 1; Campbell JA at 2; Handley AJA at 3 DECISION: (1) Appeal as to Grounds 1 -- 15 dismissed;
(2) Leave to appeal in respect of Grounds 16 -- 22 refused;
(3) Appellant to pay the respondent's costs.CATCHWORDS: CONTRACT – construction - pre-contractual negotiations as such and post-contractual conduct - not admissible on construction. - CONTRACT - party preventing or obstructing performance by other party - cannot take advantage of own wrong - other party not in breach. - CONTRACT – damages - reliance loss - onus on party in breach to prove that performance would not have enabled innocent party to recover expenditure. - LANDLORD & TENANT – repudiation - innocent party entitled to terminate lease - landlord not bound to comply with s 129 of Conveyancing Act. - LANDLORD & TENANT - breach by tenant of essential term - termination by landlord - compliance with s 129 of Conveyancing Act essential. - LANDLORD & TENANT - retail lease - statutory prohibition of unconscionable conduct - landlord in breach. - ADMINISTRATIVE DECISIONS TRIBUNAL - orders for costs - relevant factors. - ADMINISTRATIVE DECISIONS TRIBUNAL – orders for costs - appeal to Supreme Court on questions of law - appeal only by leave. LEGISLATION CITED: Administrative Decisions Tribunal Act, s 119(1), (1A)(c)
Conveyancing Act, s 129
Retail Leases Act, s 8(1), s 62B(1)
Supreme Court Act, s 101(2)(c)CATEGORY: Principal judgment CASES CITED: Agricultural and Rural Finance Pty Ltd v Gardiner (2008) 238 CLR 570
Alghussein Establishment v Eton College [1988] 1 WLR 587 HL
Apriaden Pty Ltd v Seacrest Pty Ltd (2005) 12 VR 314
Attorney-General of New South Wales v World Best Holdings Ltd (2005) 63 NSWLR 557
Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337
Commonwealth of Australia v Amann Aviation Pty Ltd (1991) 174 CLR 64
Cripps v G & M Dawson Pty Ltd [2006] NSWCA 81
Foran v Wight (1989) 168 CLR 385
Franklins Pty Ltd v Metcash Trading Ltd [2009] NSWCA 407
Gumland Property Holdings Pty Ltd v Duffy Bros Fruit Market (Campbelltown) Pty Ltd (2008) 234 CLR 237
J&C Reid Pty Ltd v Abaw Holdings Pty Ltd (1988) NSW Conv R 55416
Lakshmijit v Sherani [1974] AC 605
Laurinda Pty Ltd v Capalaba Park Shopping Centre Pty Ltd (1989) 166 CLR 623
Marshall v Council of the Shire of Snowy River (1994) 7 BPR 14,447 CA
New Zealand Shipping Co Ltd v Société des Ateliers et Chantiers de France [1919] AC 1
North v Marina (2003) 11 BPR 21,359
Panamena Europa Navigacion (Compania Limitada) v Frederick Leyland & Co Ltd. [1947] AC 428
Peter Turnbull & Co Pty Ltd v Mundus Trading Co (Australasia) Pty Ltd (1954) 90…
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Details
- Case
- [2010] NSWCA 24
- Decision Date
CaseChat Overview and Summary
The dispute in *World Best Holdings Ltd v Sarker* concerned a retail lease and arose between the landlord, World Best Holdings Ltd (appellant), and the tenant, Sarker (respondent). The matter came before the Supreme Court of New South Wales, Court of Appeal.
The Court was required to determine several legal issues, including whether pre-contractual negotiations or post-contractual conduct could be admitted to construe the terms of the lease. It also considered whether the landlord, by preventing or obstructing the tenant's performance, could take advantage of its own wrong, thereby rendering the tenant not in breach. Further issues involved the availability of reliance loss damages, the onus of proof in such claims, and whether the landlord was entitled to terminate the lease for the tenant's breach of an essential term without complying with section 129 of the *Conveyancing Act 1919* (NSW). The Court also had to consider whether the landlord's conduct constituted unconscionable conduct under the relevant retail lease legislation and the principles governing appeals from the Administrative Decisions Tribunal on questions of law.
The Court held that pre-contractual negotiations and post-contractual conduct are generally inadmissible for the purpose of construing a contract. It affirmed the principle that a party who prevents or obstructs the performance of a contract by the other party cannot rely on that non-performance as a breach. Regarding damages, the Court noted that the onus rests on the party in breach to demonstrate that performance would not have enabled the innocent party to recover their expenditure. The Court found that the landlord had breached the lease and engaged in unconscionable conduct, and that the landlord was not entitled to terminate the lease without complying with section 129 of the *Conveyancing Act 1919* (NSW).
The Court ordered that the appeal concerning grounds 1 to 15 be dismissed, leave to appeal in respect of grounds 16 to 22 be refused, and that the appellant pay the respondent's costs.
The Court was required to determine several legal issues, including whether pre-contractual negotiations or post-contractual conduct could be admitted to construe the terms of the lease. It also considered whether the landlord, by preventing or obstructing the tenant's performance, could take advantage of its own wrong, thereby rendering the tenant not in breach. Further issues involved the availability of reliance loss damages, the onus of proof in such claims, and whether the landlord was entitled to terminate the lease for the tenant's breach of an essential term without complying with section 129 of the *Conveyancing Act 1919* (NSW). The Court also had to consider whether the landlord's conduct constituted unconscionable conduct under the relevant retail lease legislation and the principles governing appeals from the Administrative Decisions Tribunal on questions of law.
The Court held that pre-contractual negotiations and post-contractual conduct are generally inadmissible for the purpose of construing a contract. It affirmed the principle that a party who prevents or obstructs the performance of a contract by the other party cannot rely on that non-performance as a breach. Regarding damages, the Court noted that the onus rests on the party in breach to demonstrate that performance would not have enabled the innocent party to recover their expenditure. The Court found that the landlord had breached the lease and engaged in unconscionable conduct, and that the landlord was not entitled to terminate the lease without complying with section 129 of the *Conveyancing Act 1919* (NSW).
The Court ordered that the appeal concerning grounds 1 to 15 be dismissed, leave to appeal in respect of grounds 16 to 22 be refused, and that the appellant pay the respondent's costs.
Orders
Orders of the court
(1) Appeal as to Grounds 1 -- 15 dismissed;
(2) Leave to appeal in respect of Grounds 16 -- 22 refused;
(3) Appellant to pay the respondent's costs.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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