Pearson v Sunland Southbank Pty. Ltd.
[2000] QDC 225
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- Unreported Judgment
- Pearson v Sunland Southbank Pty. Ltd.[2000] QDC 225
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Pearson v Sunland Southbank Pty. Ltd.[2000] QDC 225
Pearson v Sunland Southbank Pty. Ltd.[2000] QDC 225
DISTRICT COURT OF QUEENSLAND
CITATION: | Pearson & Pearson v. Sunland Southbank Pty. Ltd. [2000] QDC 225 |
PARTIES: | MAXWELL JOHN PEARSON and JUDITH CECILIA PEARSON v. SUNLAND SOUTHBANK PTY. LTD. |
FILE NO: | 1048 of 1998 (Southport) |
DELIVERED ON: | 28 July 2000 |
DELIVERED AT: | Brisbane |
HEARING DATES: | 11 and 12 July 2000 |
JUDGE: | Skoien S.J.D.C. |
ORDER: | Judgment for defendant on claim and on counterclaim |
CATCHWORDS: | Uncertainty of contract – Internal layout of unit to be constructed not contained in contract of sale – Layout plans otherwise available to purchaser. |
COUNSEL: | Mr Cochrane for plaintiffs Mr Roney for defendant |
SOLICITORS: | Nicholsons for plaintiffs Hickey Lawyers for defendant |
- [1]This is a claim for $85,000 for money had and received by the defendant to the use of the plaintiffs. It is to recover the amount of the deposit on a contract of sale of a home unit from the defendant to the plaintiff which was forfeited by the defendant upon the refusal of the plaintiff to complete the sale. There is a counterclaim by the defendant for $22,272 being the legal costs and commission incurred by it on the sale of the unit to another purchaser.
- [2]In 1996-1998 the defendant built a high rise building called Sun City in Surfers Paradise. By April 1996 the project was far enough advanced for the defendant to obtain expressions of interest to purchase units in the building and soon thereafter prospective purchasers of units began to sign contracts of sale. The building plan was registered on 22 July 1998 upon which it became possible for contracts of sale to be completed.
- [3]When called upon to complete their purchase on 6 November 1998 the plaintiffs refused to do so, alleging that their contract of sale was void for uncertainty. That uncertainty, as relied on at the trial, fell into two categories. First the plaintiff relied on the fact that the contract did not incorporate any detailed internal layout of the unit. Second the plaintiff relied on the fact that while the contract specified a “Unit Type I”, as the subject of the contract, that type of unit was not otherwise described.
The Facts
- [4]Mr. and Mrs. Pearson were social friends of Mr. Abedian, a director of Sunland. Some time in about April 1996 Mr. Pearson became aware of the fact that Sunland was proposing to build Sun City. On 18 April 1996 the Pearsons signed a “Letter of Intent to Purchase” Unit Sub PI on level 37 of the building for $855,000. The letter was expressed to be not a contractual document. The unit referred to was one of the intended sub-penthouses in the planned building.
- [5]On the back of the letter of intent Mr. Pearson wrote in his own handwriting:-
“Following my discussions with Mr. Soal (sic) Abedian of Sunland Homes particularly the telephone call held at 10.35 am this day being the 18th April 1996 it was mutually agreed the executing of the Purchase Agreement shall not be facilitated until at least the 23rd of June 1996 as the earliest opportune date. Considering the purchasers (M.J. & J.C. Pearson) shall not return to Australia from Europe until the above date.
Pearson’s solicitor: Gray & Maloney
Attention Stephen Gray
Phone: 07 3221 8200
Fax 07 3221 3940.”
and this endorsement was signed by both of the Pearsons. The note also advised the name and contact details of the Pearson’s solicitors. To my mind it demonstrated that the Pearsons were anxious not to miss out on the opportunity to buy the sub-penthouse on level 37, which seems counter to the evidence of Mr Pearson that he was really only signing the letter of intent to help Sunland arrange its finance.
- [6]Subsequently the parties signed the written contract of sale dated 24 July 1996. According to its terms Sunland agreed to sell and the Pearsons agreed to purchase the freehold title to the unit identified as “Lot 262 as highlighted in Schedule 1, being Unit Type I”, for $850,000. A deposit of $85,000 by way of bank guarantee was put forward.
- [7]In Schedule 1 to the contract, on a page headed: “Draft Building Units Plan, Proposed Level AN” a floor plan is reproduced showing three units. One is numbered 262 and is highlighted in green. It gives an area of 250m². The drawing shows the external walls, indicates the position of two balconies and the positions of four small voids (as the evidence showed, to carry services such as water and electricity). Schedule 2 set out a schedule of finishes for “Sub Penthouse Unit Types H & I”, and on another schedule two car park spaces are also highlighted in green.
- [8]The building was completed and when built it included on level 37 a sub-penthouse, number 262, the shape and dimensions of which coincided precisely with that highlighted in green on the contract.
- [9]I am satisfied that from about 1 May 1996 and up to the completion of the building Sunland maintained a site office, on the walls of which were displayed framed scale plans of each type of unit (including sub-penthouse, Unit type I). Under each of those plans, on the floor below it, was a scale model of the unit. There was also, in respect of each type of unit, a display of the materials to be used as finishes. There were also brochures containing scale plans of each type of unit kept in the site office which Ms Scott (the project manager appointed by Sunland’s real estate agent) habitually gave to possible purchasers. Unit 262 was built and finished in accordance with the displayed scale plans and models.
- [10]In evidence Mr Pearson complained that he frequently asked to be given a copy of the floor plans for the unit but that his requests were ignored. I cannot accept that. Why would a developer or a developer’s selling agent do that? Furthermore, the Pearsons engaged the services of a solicitor who was described by Mr Pearson as being most meticulous. It is curious that, if Mr Pearson were fruitlessly requesting floor plans, the solicitor’s correspondence and diary notes did not record that.
- [11]I accept Ms Scott’s evidence that on occasion at about the date of the contract Mr & Mrs Pearson were in the site office looking at the displays. Based on the fact that she was the project marketing manager for the building, I think it more probable than not that she followed her usual practice and actually spoke with them about the sub-penthouse they were interested in buying.
- [12]Mr Pearson denied any such occasion. In rejecting his evidence on the point I do not suggest that he was lying. It seems that he intended to re-sell the unit at some time, either before he and his wife were called on to complete their purchase or soon afterwards and he said that he was confident that such a re-sale would be for at least their purchase price of $850,000. He said that therefore he was not very interested in the details of the unit. That may explain his failure to recall the occasion of which Ms Scott gave evidence. I am doubtful, however, that a businessman of Mr Pearson’s experience and eminence would have contracted to pay such a large sum of money, or would have been able to feel such confidence in recovering the purchase price, had he not some knowledge of what the unit was going to be like. That assists me to accept Ms Scott’s evidence. Regrettably Mrs Pearson was not called, nor was her absence explained. I think I should add that I do not accept Mr Pearson’s evidence that Mr Abedian, or anyone else on behalf of Sunland, had undertaken to attend to the re-sale of the unit. Again, the Pearson’s solicitor’s correspondence and notes make no mention of any such arrangement.
Certainty
- [13]On the evidence this contract is a standard contract of its type. It is a contract to sell title to real estate under the provisions of the Building Units and Group Titles Act 1980. The registered building units plan presumably complied with s. 9(1) of the Act which simply requires the boundaries of each lot to be defined. Once registered each lot may be dealt with as may any other type of land (s. 8(3)). Thus lot 262, once the plan was registered, became a piece of real property capable of being transferred to the Pearsons by completion of their contract. The Pearsons repudiated the contract before completion could occur and Sunland called up the guaranteed deposit of $85,000. In any event, it is clear that Sunland was at all material times and in accordance with the contract, ready, willing and able to complete.
- [14]It is clear from the terms of the contract (see para [6] above) that the highlighted unit 262 was a Unit Type I. The contract did not itself contain the plans for the internal construction of the unit but, as I have found, these plans were not only readily available to the Pearsons but were actually shown to them in the site office, and given to them in a brochure.
- [15]Extrinsic evidence other than the parties’ own understanding of the agreement may be used to clarify ambiguities or omissions as to what the subject matter of the agreement was; see Life Insurance Co of Australia Ltd v Phillips (1925) 36 CLR 60 at 71 and 78-80, or to establish the background and evident purpose of the agreement, including its subject matter. Thus, in Havenbah Pty Ltd v Butterfield (1974) 133 CLR 449 the High Court was able to uphold a contract for the sale of land when the precise location of land to be excised from a larger parcel had been left ambiguous. It did so by reference to objective criteria, a description of some aspect of the land which was capable of being used by, for example, a surveyor, to describe the land which the parties had imperfectly described in their agreement. See also Sunbird Plaza Pty Ltd v Boheto Pty Ltd (1983) 1 Qd.R. 248.
- [16]Even provisions apparently vague or uncertain can be given substance if there is some external yard stick or standard by reference to which the content of the agreement can be more precisely defined. For example, an agreement on the terms of “the usual” terms of a party was certain once it was ascertained that there were usually such terms, whether known to the purchaser or not; Carter & Harland, Contract Law in Australia 3rd ed. para [261] and cases there cited.
- [17]This case falls squarely within the principles referred to in paras [15] and [16] above. There is no lack of certainty in the contract and the plaintiffs were not entitled to repudiate it. Their claim for the return of the deposit fails.
Counterclaim
- [18]The plaintiffs accept that, in the event of their claim failing, the defendant is entitled on its counterclaim to the sum of $22,272. The contract, by clause 15.6, provides for interest on any judgment against the plaintiffs at the rate of 15% and I see no reason to depart from that agreed rate.
Conclusion
- [19]I give judgment for the defendant on the claim and on the counterclaim for $22,272 together with interest on that sum at 15% from 6 November 1998.