Legal Research
Cases
Wu v Statewide Developments Pty Ltd

Wu v Statewide Developments Pty Ltd

Case [2010] NSWSC 1016 10 September 2010

No judgment structure available for this case.

Type to search within this case.

CITATION: Wu & Anor v Statewide Developments Pty Ltd [2010] NSWSC 1016

HEARING DATE(S): 30 August to 2 September 2010

JUDGMENT DATE :
10 September 2010

JURISDICTION: Equity Division

JUDGMENT OF: Palmer J

DECISION: Declaration that Plaintiffs validly rescinded contract and consequential orders.

CATCHWORDS: CONVEYANCING – CONTRACT FOR SALE – RESCISSION – ELECTION – WAIVER – before completion of contract, vendor creates restrictive covenant on title giving effect to an Environmental Management Plan, to ensure that soil contamination is properly managed – whether covenant detrimentally affects property to a substantial extent – whether purchasers entitled to rescind in accordance with contractual term – whether, after valid rescission, purchasers could elect to affirm contract. - DAMAGES – vendor holds property for three years after rescission of contract – whether vendor can recover as damages mortgage payments and holding charges incurred.

LEGISLATION CITED: Conveyancing Act 1919 (NSW) – s 55(2A), s 88B

CATEGORY: Principal judgment

CASES CITED: - Agricultural & Rural Finance Pty Ltd v Gardiner (2008) 238 CLR 570
- Commonwealth v Verwayen (1990) 170 CLR 394
- Hadley v Baxendale (1854) 9 Exch 341, 156 ER 145
- Havyn Pty Ltd v Webster [2005] NSWCA 182
- Higgins v Statewide Developments Pty Ltd [2010] NSWSC 183
- Nassif v Caminer [2009] NSWCA 45
- Romanos v Pentagold Investments Pty Ltd (2003) 217 CLR 367

PARTIES: Da Hui Wu (First Plaintiff/1st Cross Defendant)
Jing Jing Li (Second Plaintiff/2nd Cross Defendant)
Statewide Developments Pty Ltd (Defendant/Cross Claimant)

FILE NUMBER(S): SC 2007/254837

COUNSEL: S.P. Brennan (Plaintiffs/Cross Defendants)
J. Stoljar SC, Ms J. Taylor (Defendant/Cross Claimant)

SOLICITORS: Gregory J. Goold (Plaintiffs/Cross Defendants)
Mallesons Stephen Jaques (Defendant/Cross Claimant)

07/254837 Wu & Anor v Statewide Developments Pty Ltd

JUDGMENT

10 September, 2010

Introduction

1 On 6 July 2006, the Plaintiffs entered into a contract to purchase from the Defendant a three bedroom unit in Building G of a large development in the course of construction at Rhodes. The contract price was $880,000 and the Plaintiffs paid a deposit of $88,000 on exchange.

2 In these proceedings the Plaintiffs seek primarily a declaration that they have validly rescinded the contract and they claim consequential orders. In the alternative, they seek an order under s 55(2A) Conveyancing Act 1919 (NSW), for the return of the deposit.

3 The Defendant seeks a declaration that it, not the Plaintiffs, has validly rescinded the contract for the Plaintiffs’ breach. It says that the deposit of $88,000 is forfeited to it. In addition, the Defendant seeks damages. It has been unable to sell the home unit in the period of more than three years since, on both parties’ assertions, the contract was rescinded. The Defendant seeks damages for the holding costs of the unit, amounting to $264,555.61.

4 There is virtually no dispute as to the underlying facts. Most are apparent from contemporaneous documents. There are no issues which depend upon findings as to the credit of witnesses.

Facts

5 The subject unit, Unit 304G, is located in Building G on 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.

Continue reading Wu v Statewide Developments Pty Ltd

Details

AGLC: Wu v Statewide Developments Pty Ltd [2010] NSWSC 1016
Case: [2010] NSWSC 1016
Decision Date: 10 September 2010

CaseChat Overview and Summary

In the matter of Wu v Statewide Developments Pty Ltd, the dispute before the court centred on the sale of a property, with the vendor creating a restrictive covenant on the title before the completion of the sale. The purchasers sought to rescind the contract due to the covenant's detrimental effect on the property, as provided for in the contractual terms. The vendor, however, argued against rescission and claimed damages for the mortgage payments and holding charges incurred after the rescission. The court was required to determine the validity of the rescission, the possibility of affirming the contract after rescission, and the vendor's entitlement to damages for the period the property was held after the rescission.

The primary legal issues before the court involved the interpretation of the contractual term allowing for rescission and whether the restrictive covenant created by the vendor amounted to a substantial detriment to the property. Additionally, the court had to assess whether the purchasers could elect to affirm the contract after validly rescinding it, and whether the vendor was entitled to damages for the mortgage payments and holding charges incurred post-rescission.

The court ruled that the restrictive covenant created by the vendor did indeed amount to a substantial detriment to the property, thereby justifying the purchasers' decision to rescind the contract. Furthermore, the court determined that the purchasers were entitled to elect to affirm the contract after rescinding it, and that the vendor was not entitled to recover the mortgage payments and holding charges as damages for the period the property was held post-rescission. The court found that the vendor's actions had prejudiced the purchasers' ability to enjoy the property, and as such, the vendor was not entitled to recover the holding costs.

The court's final orders confirmed the validity of the purchasers' rescission of the contract and their election to affirm it. Additionally, the court ruled that the vendor was not entitled to recover the mortgage payments and holding charges incurred after the rescission. This decision underscores the importance of careful consideration of restrictive covenants and their potential impact on property, as well as the rights of purchasers in the event of a substantial detriment.

Orders