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Bulwer Pty Ltd v Ryan[2024] QSC 155

Bulwer Pty Ltd v Ryan[2024] QSC 155

SUPREME COURT OF QUEENSLAND

CITATION:

Bulwer Pty Ltd v Ryan [2024] QSC 155

PARTIES:

Bulwer Pty Ltd ACN 644 791 692

(Applicant)

v

Trent Andrew Ryan and Karen Lee Ryan

(Respondents)

FILE NO/S:

SCR No 617 of 2023

DIVISION:

Trial Division

PROCEEDING:

Application

ORIGINATING APPLICATION:

Filed 4 May 2023

ORIGINATING COURT:

Supreme Court of Queensland at Townsville

DELIVERED ON:

25 July 2024

DELIVERED AT:

Townsville

HEARING DATE:

3 August 2023, (receipt of last submission 16 August 2023)

JUDGE:

North J

ORDER:

  1. 1.
    It is declared that on 14 December 2022, the applicant validly terminated a contract of sale dated 2 August 2022 between the applicant and the respondent in respect of the sale and purchase of two sub-sub-leases having registered dealing numbers 602816638 and 602816639, and 252,000 ordinary shares in the capital of Hamilton Island Development A Pty Ltd ACN 010 254 190 numbered 564,001 to 798,000 inclusive.
  1. 2.
    The sum of $128,500 paid into court in this proceeding on 30 May 2023 be paid out to the applicant, together with any accretions.
  1. 3.
    Within 14 days the parties are to exchange and file written submissions with respect to costs (not to exceed two pages).
  1. 4.
    The costs are to be determined “on the papers” without appearance in person.

CATCHWORDS:

ESTOPPEL – WAIVER – BREACH OF CONTRACT – RIGHT TO TERMINATE – where Seller is the holder of the Shares and the registered proprietor of a Sub-sub-lease – where by virtue of the Articles of Association of the Development Company the holder of the shares is entitled to the Sub-sub- lease and to occupy the apartment upon the conditions set out in the Articles of Association of the Development Company and in the Sub-sub-lease – where the contract of sale is subject to and conditional upon the consents being obtained from certain parties – where if by settlement the Seller has not been able to procure all the consents described in the contract not due to any default of the Seller the parties mutually agree that completion of this Contract shall be extended to that date which is seven (7) business days after the Seller provides written notice to the Buyer that the Consents have been obtained and settlement can proceed – where the consents have not been obtained within 90 days of the date of this contract then either party may elect to cancel this contract and any costs incurred in obtaining consents already obtained shall be borne by the Seller unless the Buyer has not co-operated or caused any delay in obtaining the consents – where parties have mutually agreed to multiple extensions to the sunset date – where the Seller has sought extension to sunset date into new year – where buyer has terminated the contract and sought reimbursement of consent costs paid and a refund of the deposit – whether the Buyer was entitled to terminate the contract or was in breach of contract – whether the Buyer waived its right to terminate – whether the Buyer was estopped from terminating – whether time was of the essence.

CASES:

McPhee v Zarb & Ors [2002] QCA 530, cited

Legione v Hateley (1982) 152 CLR 406, cited

Prospect Resources v Mulyneux [2015] NSWCA 171, cited

Mount Bruce Mining Pty Ltd v Wright Prospecting (2015) 256 CLR 104, followed

Victoria v Tatts Group Limited (2016) 328 ALR 564, followed

COUNSEL:

Mr Kelly for the Applicant

Mr Evans for the Respondents

SOLICITORS:

PD Law for the Applicant

Connolly Suthers for the Respondents

  1. Introduction
  1. [1]
    “Poinciana Lodge” is a building on Hamilton Island. It was constructed by Development Company A Pty Ltd (Development Company). Poinciana Lodge contains a number of residential apartments. The applicant (buyer) contracted with the respondents (sellers) to purchase the seller’s interest in two residential apartments.
  1. [2]
    This was done under a written contract dated 2 August 2022 whereby the sellers agreed to transfer their Sub-sub-lease for the two apartments and the relevant shares in Development Company[1] to the buyer the purchase price of $1,285,000. Pursuant to the contract on 5 August 2022 the buyer paid a deposit of $128,500.
  1. [3]
    The buyer contends that it validly terminated the contract and that it is entitled to the return of the deposit. It seeks a declaration that it validly terminated the contract and orders for the return of the deposit which has been paid into court. The sellers dispute the buyer’s claims on a number of grounds and contend that they are entitled to the deposit.
  1. [4]
    The right to occupy apartments in Poinciana Lodge requires two things, a sub-lease from Development Company and holding a specified bundle of shares in Development Company under its Articles of Association. This arises because Development Company sub-leases the land Poinciana Lodge is built on from Hamilton Island Enterprises Ltd (HIE) and because of the requirement of Development Company’s Articles of Association.
  1. [5]
    When an apartment is sold the outgoing owner (vendor) transfers the sub-sub-lease and shares in Development Company to the incoming purchaser who thus attains the right to occupy the apartment subject though to the transfer process occurring with the consent of:
  1. “(a)
    Development Company – to the transfer of the sub-sub-lease and the shares;
  1. (b)
    HIE – to the transfer of the sub-sub-lease; and;
  1. (c)
    Westpac Banking Corporation (HIE’s financier) – to the transfer of the sub-sub-lease.”
  1. [6]
    In large measure the facts and circumstances are not contentious. This is so because much of the evidence is comprised of the contract and documents such as written correspondence between the solicitors for the buyer and the sellers. As a consequence after final submissions the parties were able to collaborate and submit an agreed chronology.[2] But there are issues of fact arising out of the evidence of the solicitors concerning some conversations that requires resolution as it affects some of the rival contentions.
  1. [7]
    Before turning to the evidence and to its consideration it is helpful to set out some of the relevant contractual terms.
  1. The contract and provisions
  1. [8]
    RECITALS:
  1. “A.
    Hamilton Island Enterprises Ltd. ACN 009 946 909 is the Lessee of the Leased Land pursuant to the Perpetual Country Lease.
  1. B.
    Hamilton Island Enterprises Ltd. ACN 009 946 909 has granted to the Development Company the Sub-Lease.
  1. C.
    The Development Company has constructed on the sub-leased land the building which comprises apartments (including the apartment) and ancillary facilities.
  1. D.
    The Seller is the holder of the Shares and the registered proprietor of the Sub-sub-lease.
  1. E.
    By virtue of the Articles of Association of the Development Company the holder of the shares is entitled to the Sub-sub-lease and to occupy the apartment upon the conditions set out in the Articles of Association of the Development Company and in the Sub-sub-lease.
  1. F.
    The Buyer wishes to purchase and the Seller wishes to sell the Sub-sub- lease and the shares.”

[9]

“10.

Time

  1. 10.1
    Time shall be in every respect of the essence of this Contract.”

[10]

“13.

Consents

  1. 13.1
    This Contract is subject to and conditional upon the following consents being obtained from the following parties prior to the Settlement Date:-
  1. (1)
    the consent of Hamilton Island Enterprises Limited. to the transfer of the Sub-sub-lease;
  1. (2)
    the consent of the Directors of the Development Company to the transfer of the Sub-sub-lease;
  1. (3)
    the consent of the directors of the Development Company to the transfer of the shares;
  1. (4)
    the consent of Westpac Bank (as Mortgagee) to the transfer of the Sub-sub-lease;
  1. (5)
    the consent of Westpac Bank (as Chargee) to the transfer of the Sub-sub-lease.
  1. 13.2
    Promptly after the execution of this Contract, the Sellers will take all necessary steps to obtain the consents mentioned in Clause 13.1. The Buyer acknowledges that the Development Company will require the execution of a Deed of Covenant in such terms as the Development Company’s solicitors approve to evidence the Buyer’s assumption from the Seller of all obligations under and pursuant to the Sub-sub-lease and the Buyer agrees to execute the same promptly on request.”

[11]

“17.

Extension of Settlement Date

  1. 17.1
    If on the Settlement Date as specified in the Schedule the Seller has not been able to procure all of the Consents described in Clause 13 not due to any default of the Seller the parties mutually agree that completion of this Contract shall be extended to that date which is seven (7) business days after the Seller provides written notice to the Buyer that the Consents have been obtained and settlement can proceed. This date shall then be and become the Settlement Date under this Contract.
  1. 17.2
    If the consents have not been obtained within 90 days of the date of this contract then either party may elect to cancel this contract and any costs incurred in obtaining consents already obtained shall be borne by the Seller unless the Buyer has not co-operated or caused any delay in obtaining the consents in which case the costs incurred in obtaining the consents already obtained shall be borne by the Buyer.”
  1. [12]
    “Schedule

“7.

Settlement Date:

Settlement shall take place on the date which is the later of:-

  1. 90 days from the date of the Contract or;
  2. seven business days after the conditions referred to in Clause 13 of this Contract have been fulfilled or as provided in Clause 17.1 herein.”
  1. The evidence
  1. [13]
    The persons who (for the most part) acted for the buyer and the sellers were Ms Bernadette Gunders of PD Law (for the buyer) and Ms Karen Kerr of Rod Holloway and Co (for the sellers). Both made affidavits which were filed and relied upon.[3] Both were called as witnesses and cross examined.[4] I have referred to an agreed chronology[5] which identifies relevant dates, events (including correspondence) and cross references to an agreed trial bundle of documents.[6] The chronology is a useful document for understanding the correspondence and documentation especially in context. It is long (more than 13 pages) so I incorporate it in to my reasons by annexing a copy to my reasons.[7]
  1. [14]
    On 16 September 2022 Ms Gunders on behalf of the buyer gave notice that the pest and building inspections were satisfied. The consequence was that consistent with Cl 22.1 of the contract it became relevantly unconditional. Settlement became an issue and this involved the consents specified by Cl 13 being secured. Relevantly the date referred to by the parties as the “sunset date” consistent with Cl 17.2 of the contract became 31 October 2022 being 90 days from the date of the contract. On that date Ms Kerr by email requested that the date for completion of the contract be extended to Monday 28 November 2022 with time remaining of the essence. That extension was granted by email on 2 November 2022 and it was stipulated that time remain of the essence.
  1. [15]
    On 28 November 2022 Ms Kerr emailed Ms Gunders requesting that the “sunset date” to be extended to 5 December 2022 with time to remain of the essence. By email on 29 November Ms Gunders advised that her client agreed, in the circumstances, that the “sunset date” for consents be extended to 9 December 2022. On 5 December 2022 Ms Kerr sent an email to Ms Gunders. She wrote:
  1. “
    Hi Spoke to HIE Nick just now
  1. I am told director will sign the do on Monday 12th that would trigger settlement over the break… and HIE aren’t back till 9th so earliest will be 10th .. unless the parties want to do earlier…is this something your people; would want I don’t want to sort it all and then everyone want NY
  1. I will also have to seek a ext on end date due today so thinking 12th January for ease until we sort the earlier settlement??”
  1. The next email was sent by Ms Dumont of PD Law on 9 December 2022:
  1. “
    We note that the sunset date is due today and await your instructions.”
  1. On 12 December 2022 Mr Tierney (who acted on behalf of Development Company)[8] sent an email to Ms Gunders and copied Ms Kerr in:
  1. “
    Hi Bernie
  1. Nicole is away today so I’m following up on this one. Do you have an anticipated settlement date?”
  1. Ms Gunders (copying in Ms Kerr) responded on 12 December:
  1. “
    We are still waiting on the consent as far as I know, the sunset date has passed and we haven’t had a request from the seller at this point.
  1. Karen are you able to obtain instructions in regard to the sunset date and send through a formal request to extend?”
  1. The following day (13 December 2022) Ms Kerr sent an email to Ms Gunders:
  1. “
    We request the sunset date be extended to 12th January 2023 with time to remain of the essence”
  1. To which Ms Gunders replied:
  1. “
    Waiting on instructions.”
  1. [16]
    On 14 December 2022 Ms Gunders sent an email to Ms Kerr to which a letter bearing that date was attached. By the letter the buyer purported to terminate the contract and sought reimbursement of consent costs paid and a refund of the deposit. The letter read:
  1. “
    RE: Bulwer Pty Ltd A.C.N. 644 791 962 Purchase from Ryan Property: Poinciana Lodge A004 and A005/2 Marina Drive, Hamilton Island QLD 4803
  1. We refer to your correspondence of 13 December 2022. We have now obtained our clients’ instructions.
  1. Our client does not agree to extend the sunset date for consents any further, accordingly pursuant to 17.2 of the contract of sale our client elects to cancel the contract.
  1. We note that your client must reimburse our client for the consent costs paid by our client in the amount of $2,289.38 and the deposit is to be refunded to our client.
  1. Please authorise the agent to release the deposit to our client and arrange for the consent fees to be deposited to our trust account as outlined below:”
  1. [17]
    Between 2 August 2022 when the contract was signed and the termination by the buyer on 14 December 2022 Ms Gunders and Ms Kerr had two conversations and both are of some significance. The first occurred on 22 August 2022 and the second on 5 December 2022. Otherwise they communicated by emails. According to the agreed chronology the first conversation was about obtaining the consents for the purpose of Cl 13.1 of the contract. In her affidavit filed on 28 July 2023 Ms Kerr said, concerning the conversation on 22 August 2022:
  1. “2.
    I refer to the conversation with Ms Gunders referred to at paragraph 6 of my previous affidavit and by way of further detail, the conversation, to the best of my recollection, was to the following effect:
  1. (a)
    I said that I had little to no experience in transactions involving a unit property on Hamilton Island such as the one the subject of the Contract;
  1. (b)
    Ms Gunders said she had significant experience in property transactions on Hamilton Island, and that she would help me if I had any questions;
  1. (c)
    I asked Ms Gunders about the various consents required by the Contract;
  1. (d)
    Ms Gunders said words to the effect:
  1. (i)
    under the contract the buyer was required to pay the costs of obtaining the consents;
  1. (ii)
    in these types of transactions, buyers generally do not take any steps to incur the costs of obtaining consents until the contract goes unconditional as to building and pest; and for that reason the buyer would not take any steps in relation to obtaining consents before the contract had gone unconditional as to building and pest.
  1. 3.
    Following this discussion with Ms Gunders, I proceeded on the basis that the buyer would not take any action in relation to obtaining consents until the contract had become unconditional as to building and pest and that I shouldn’t either. This is normal practice in my experience where conditions haven’t been satisfied.
  1. 4.
    To the best of my recollection, Ms Gunders did not say words to the effect that “I was free to do it my way” or “however it was up to me to decide whether I wanted to wait until after the contract became unconditional to request consents or to go ahead and request them now”. If she had said those words or something to that effect, it would have put me on the ‘alert’ that there was something she wasn’t telling me, or that I was doing the wrong thing.”
  1. Concerning the conversation Ms Gunders said:[9]
  1. “18.
    On 22 August 2022, I received a phone call from Ms Kerr to discuss the progress of consents process and settlement considerations. I know this call took place on 22 August 2022, as I reviewed my phone call logs for this date and received a call from her phone number and recall sending an email the following day after the phone call with contact information to assist Ms Kerr with requesting Consents. A copy of the email, sent at 4:17pm on 23 August 2022 to Ms Kerr following my phone call is at [page 39].
  1. 19.
    To the best of my recollection the following is what I recall from my telephone conversation with Ms Kerr:
  1. a.
    Ms Kerr had indicated that she did not have a lot of experience with Hamilton Island transactions and would be hoping to reach out to me for some assistance. I took this to mean that Ms Kerr had not acted in many Hamilton Island sublease transfers. I told Ms Kerr that I had experience in dealing with Hamilton Island sublease transfers, and so, I told Ms Kerr that I would be happy to provide her with assistance on the general process.
  1. b.
    After Ms Kerr advised that she was not overly familiar with Hamilton Island sublease transfers, I provided her with some information on how the consent process works and explained that Ms Kerr would need to seek the consent of both HIE and The Development Company.
  1. c.
    I told Ms Kerr that generally Sellers, who have Contracts that subject to conditions entitling the buyer to terminate, wait until the Contract was unconditional before requesting Consents to limit costs in the event a buyer terminates under a contract condition. Notwithstanding the standard practice on dealing with applying tor Consents, I told Ms Kerr that it would be up to her as to whether she applies for the Consents immediately or waits until the Contract is unconditional before applying.
  1. d.
    Ms Kerr made a comment that she did not know how to locate the contact information to request consents and so I told Ms Kerr hat I would send her an email with contact details for HIE and The Development Company.
  1. e.
    Ms Kerr also asked who is responsible for paying the costs associated with requesting consents. I told Ms Kerr the buyer was required to pay the costs associated with obtaining the Consents and that once I had received the invoice, we would pay the consent fees from funds held on behalf of the Applicant in PD Law’s trust account.
  1. 20.
    The Points of Claim at paragraph 11, make reference to the conversation I had with Ms Kerr on 22 August 2022, some of the statements made at paragraph 11 are incorrect and I say that in relation to matters raised specifically at subparagraphs (ii), (iii) and (iv):
  1. a.
    At no point did I tell Ms Kerr that I would be instructing the Applicant not to take any steps in relation to the Consents process. This would be an unusual comment to make as the Seller is responsible for seeking Consents and it is not something I would usually advise Buyers to do during the course of a transaction.
  1. b.
    I also never told Ms Kerr to refrain from taking any steps in relation to Consents until after Building and Pest had been satisfied. During my conversation with Ms Kerr, I only ever provided general guidance on the procedural elements in requesting the Consents and provided some guidance on the usual process and timings in obtaining consents.
  1. c.
    As consent documents usually need to be signed in original, Once the consent documents were received, I would ordinarily take all reasonable steps to ensure buyers do all things they need as soon as possible to progress consents in a timely manner. In relation to the Applicant specifically, as they resided in Brisbane it was even more pertinent that documents be provided in a timely manner to allow sufficient time for their execution and return by post to our office.”
  1. [18]
    At the trial Ms Gunders was questioned by Mr Evans about the conversation of 22 August 2022:[10]
  1. “
    Yes. I’ll come back to this conversation that you had on the 22nd of August. There’s no file note of this conversation, is there?---No.
  1. In the conversation, Ms Kerr has just told you about her inexperience with Hamilton Island matters and you’ve offered to help. We’ve been through that. During the conversation, she then asked you about the requirement to obtain consents in the contract.
  1. HIS HONOUR: You’re nodding. I think you have to answer that?--- Yes. Sorry.
  1. MR EVANS: Sorry. Thank you. This contract provided, and I’m speaking generally, that consents were required to be obtained by the sunset date?---Yes.
  1. And the sunset date, I don’t think that term appears in the contract, but it seems to be accepted that that’s the date which is 90 days after the - - - ?---Yes.
  1. - - - contract date?---Generally, that’s how we look at it when we look - - -
  1. Sorry, what was - - -?---When we look at those contracts, yes, we take it the sun - that’s the - the sunset date is referred to as the consent date.
  1. Yes.
  1. HIS HONOUR: Is that the same as a settlement date?
  1. MR EVANS: No. Not - well, sometimes. Can I come to that in my submissions, your Honour - - -
  1. HIS HONOUR: Yes.
  1. MR EVANS: - - - but I think for the purpose of this, I’m being pretty general about the transaction.
  1. Now, generally speaking again, if the consents are obtained by the sunset date, then both parties have a right to bring the contract to an end by the giving of a notice of termination?---Yes.
  1. In this contract, the original sunset date was the 31st of October?---Yes.
  1. The contract date was the 2nd of August?---Yes.
  1. So there’s about - what’s that, almost three months to obtain the consents?---Correct.
  1. Now, in this conversation, you said to Ms Kerr that the normal practice in your experience is that the parties will generally wait until the contract goes unconditional before obtaining consents?---Yes.
  1. And that’s what you said to her, but in - I’m asking in your experience, is that consistent with your experience of these transactions? That the parties do that?---Yes, definitely.
  1. You gave her this information because you thought she might not have known it because she - - -?---Yeah. We were having a general discussion about the processes because she wasn’t aware of the processes, and I said, generally, most law firms will wait until those contracts are un - those conditions are satisfied due to the consent - the cost of the consents.
  1. Yes?---And that it was up to her how she wanted to proceed.
  1. Thank you. This is a - of course, this contract was conditional on building and pest ?---Yes.
  1. And I think you’ve just said this in your answer, but I’ll ask it again. The reason for parties to delay it in accordance with this usual practice is so there’s no wasted costs in the event that the right of termination is exercised, for example, under the building and pest condition. No one spent money obtaining consents which are then unnecessary. That’s the point of that - - -?---Yes.
  1. And under this contract, it’s the buyer who pays the cost of obtaining the consents?---Yes. Once we receive the invoices for the consents, we pay it.
  1. Yes?---The buyer pays.
  1. So when we’re talking about avoiding wasting costs, it’s avoiding wasting costs for your client, isn’t it, in this case?---I’m not sure how to answer that.
  1. Well, the buyer normally pays the costs of the consents, you delay - you accepted that?---Yeah.
  1. You delay the procedure for obtaining consents, so no one incurs costs unnecessarily?---Yes.
  1. The only person who’d be incurring those costs would be the buyer?--- Yes.
  1. So the delay is ultimately for the benefit of the buyer?---Yes.
  1. Now, you told Ms Kerr about this normal practice and then you asked her to follow the normal practice, didn’t you?---No. I told her that it was up to her how she wanted to proceed.
  1. I think your words - - -?---So I - I gave her the general processes and I said it was up to her how she wanted to proceed with that.
  1. I think your wording - well, you’ve said it in two ways in your material, I think. One of them was, “You’re free to do it your way,” which I accept carries the same meaning. Well I suggest to you that you didn’t say that?---No. I told her that - that - I would not tell her not to do it. I told her that it was up to her how she did - how she proceeded, how she went about it.
  1. Yes. When parties follow this normal practice, what they’re agreeing to do, in effect, is to delay taking steps towards on obligation which is time sensitive. Is that right?---Yes.
  1. And in your experience, and I’m talking about other transactions, when parties agree to adopt this practice, do the seller’s representatives ever, for example, ask for a corresponding extension of the sunset date?--- Sorry, could you say that again?
  1. When the parties agree to follow this practice - - -?---Yes.
  1. - - - in your experience, which is ultimately for the benefit of the buyer, do the seller’s representatives ever write to you and say, “Hey, we’ve agreed to this for your client’s benefit. We would like a corresponding extension on the sunset date for the period of the delay that we’ve just agreed to.” Do they ever do anything like that?---That does happen, yes.
  1. Have you done that before when you were acting for the sellers?---On different files?
  1. Yes. That’s what I’m - - -?---There’s been times where if my client has wanted to make the process a little bit quicker after the contract’s become unconditional and the buyer’s still got a condition, we will write to them and say that we would like to apply for the consents before the contract’s unconditional, and it’s on that basis that we’ll be applying for the consents straightaway.
  1. Yes. So sometimes - do I take from that answer that sometimes when you’re acting for the seller, you would look to protect their rights - - -?- --Definitely.
  1. - - - in relation to this obligation - - -?---Definitely.
  1. - - - in circumstances where they’ve agreed to delay doing something which they’re obliged to do?---Yes.
  1. Now, you didn’t tell Ms Kerr that, did you?---No.”
  1. [19]
    Ms Kerr was cross examined about this conversation:[11]
  1. “
    Now, you had a conversation with Ms Gunders on 22 August 2022, and in your affidavits - or particularly in your second affidavit you have deposed to that conversation. Could I just ask you some questions about that, if I may, please. So when - or during that conversation, one of the things that you discussed with Ms Gunders is that you didn’t have a lot of experience with this particular type of transaction - - -?---Correct.
  1. - - on Hamilton Island. And Ms Gunders said to you, “Well, I do have experience with these types of things”?---Correct.
  1. And that conversation developed to the point where you asked whether Ms Gunders could provide you with some guidance in relation to how - - -?---Absolutely, yes.
  1. - - - the transaction worked. And one of the things you might need guidance on was the obtaining of the consents under clause 13.1?--- Well, yes. I asked for guidance.
  1. And Ms Gunders said that she’d be happy to provide you with some assistance about the general process - - -?---Yes, correct.
  1. - - - on Hamilton Island transfers. And one of the things that Ms Gunders told you was that you would need to seek the consent of both Hamilton Island Enterprises, which I call HIE?---Yep.
  1. And also Development Company A, which I’ll just call Development Company?---In that conversation, there was a rough outline of procedure, yes.
  1. Yes. And Ms Gunders said to you that, generally, sellers that have contracts that allow the buyer to terminate before it becomes unconditional. In respect of those type of contracts, the general practise is to wait until the contract becomes unconditional - - -?---Could you say that again, please?
  1. - - - before seeking consents?---Sorry. The existing relation of this particular contract?
  1. Yeah?---Yep.
  1. What I’m talking about is in the context of you and Ms Gunders discussing the general approach to Hamilton Island - - -?--- Obviously - - -
  1. - - - transfers?---- - - there’s a cost associated on - for the client, so yes. While there was still clauses to be satis - satisfied; in particular, building and pest.
  1. So the sellers - it was said by Ms Gunders, the sellers will generally not do anything to get the consents - - -?---It was inferred, yes.
  1. - - - during that period. And she said to you also that whether you wanted to apply for the consents in this instance was up to you?---I don’t recall that particular phrase.
  1. Perhaps you recall her saying words to the effect of this is the general practise that sellers wait till it goes unconditional, but you can do it at any time?---I don’t recall that particular sentence being said at the end.
  1. You said to Ms Gunders - or made a comment to the effect that you didn’t know how to find the information about how to request the consents. Do you remember that?---I did ask who - who was who in the zoo, and where I would have to go get the information from, yes.
  1. Yes. And Ms Gunders told you that she’d send you an email with the contact details of the people at HIE - - -?---And she did, yes.
  1. - - - and the people at Development Company. Yes. And you asked who was responsible for paying costs associated with the consents?---I did ask that question
  1. And Ms Gunders told you that it was the buyer - - -?---Correct.
  1. - - - who was responsible. But you understand, don’t you, that under the contract, if it is terminated by the buyers and they’re not at fault for that termination, that it’s your clients who have to reimburse those costs?---Yes.
  1. What Ms Gunders didn’t say to you during that conversation was that it’s buyers who generally don’t take that step. And when I say take that step, I mean seeking to obtain the consents before the contract becomes unconditional?---She didn’t say that. Sorry?
  1. Yes, she didn’t say that. You agree - do you agree with that?---Not that I recall, she said that.
  1. And just so we can be clear, you’re agreeing with my proposition that she didn’t say buyers generally don’t take steps to obtain the consents while the contract’s conditional?---I don’t recall, but it makes perfect sense that you wouldn’t spend money until you are proceeding.
  1. So you don’t recall that. And she said that - and another thing that she didn’t say was that the reason buyers don’t take those steps in relation to obtaining consents before the contract becomes unconditional is because of the potential cost of them?---Well, that does make sense, yes.
  1. And if she had had said things - if she had had said those things about buyers not obtaining consents, that would’ve been - you would’ve found that unusual, wouldn’t you? Because under the contract, it’s the sellers who have to obtain those consents?---Well, yes. But as I said, I was, you know, learning on - on the go.
  1. And ultimately, really, it’s not for Ms Gunders to tell you what to do; you’re an experienced conveyancer?---Agreed.
  1. Ms Gunders didn’t say to you that your clients shouldn’t comply with their obligations to obtain the consents by the sunset date, did she?--- Could you repeat that, please?
  1. Yes. Ms Gunders didn’t say to you that your clients shouldn’t comply with their obligation to obtain the consents by the sunset date?---I don’t recall her saying that to me, no.
  1. And from that discussion on 22 August, there was nothing that Ms Gunders said to you that would make you believe that your clients were relieved of their obligation to obtain those consents by the sunset date?---No.
  1. Nothing Ms Gunders said made you believe that time was not of the essence of the contract, either?---We didn’t have that conversation. But no, she didn’t say anything to me to say time was no longer of the essence, no.
  1. Thank you. And the concept in conveyancing of not taking steps to do things until a contract becomes unconditional isn’t a new one to you, is it?---No.
  1. And that is a principle that can apply to both sellers and also to buyers, isn’t it?---Conveyancing 101: clients don’t like spending money unless they’re proceeding.
  1. Indeed. Now, it’s your normal practice, isn’t it, not to incur costs on behalf of your clients until contracts become unconditional?---Our normal practice is if the client gives us written instructions to proceed and start running up costs, we will but not without written instructions.
  1. All right. Did you receive written instructions from Mr and Mrs Ryan to start running up costs before it became unconditional?---No, I did not.
  1. So the decision not to do anything about obtaining the consents until the contract became unconditional, was that your decision?---There was negotiations in relation to building and pests between the parties that were happening via the agent, so yeah, it wasn’t my decision. I mean, the client was negotiating with the buyer.
  1. All right. Did you seek instructions from the client on that point?---In relation to?
  1. When to start obtaining the consents?---Yeah, they were focusing on the building and pests negotiations.
  1. Right. So were there instructions to you not to seek those content - consents?---I don’t recall tho - that. No.
  1. All right. Do you recall what their instructions were in terms of timing?---They were completely focused on getting the contract unconditional and moving to settlement, negotiating the works and the price reductions with the buyer via the agent.
  1. All right. So just returning to my question, do you remember them giving you instructions about the timing of when to obtain consents?--- In part - no, I don’t recall them saying, you know, go and get those done next week, or whatever. As I say, they were waiting to get the contrac unconditional.
  1. Yes. So after that conversation with Ms Gunders on 22 August, she sent you an email at 4.17 pm on 23 August providing you with the names of the people on Hamilton Island and also the names of the people at Cronin Shearer lawyers to approach to start the process of getting the consents?---Correct.
  1. Do you agree with that?---Yes.
  1. I will hand you up a copy of that email. Have you had a chance to read that, Ms Kerr?---Do you - like me to read it?
  1. Yes, just to yourself is sufficient?---Yes, I have read it.
  1. Excellent. Now, it doesn’t ask you, does it, not to apply for consents?---No, it does not.
  1. And it doesn’t say that the buyers won’t be doing anything until the contract goes unconditional, does it?---No, it does not.
  1. I tender that document, your Honour.
  1. HIS HONOUR: Exhibit 7.
  1. EXHIBIT #7 ADMITTED AND MARKED
  1. MR KELLY: So from 23 August 2022, you had the names and the contact details of the people that you needed to approach to obtain the consents?---Correct.
  1. But you didn’t apply in August, did you?---No
  1. And you didn’t apply in September?---No.
  1. You weren’t really in a hurry to do that until the contract became unconditional?---I was waiting for the matter to - yes, it was going to proceed. Yes.
  1. And you can take it that - and I don’t think it’s in dispute that the contract became unconditional on 16 September 2022. That’s when all the building and pest issues became resolved between - - -?---Yes.
  1. - - - the parties. You’d agree with that? And even though the contract’s unconditional as at 16 September, it wasn’t until 4 October that you sought HIE’s consent, was it?---Correct.
  1. And it wasn’t until 5 October that you sought Development Company’s consent?---Correct.
  1. And that delay of around sort of two and a-half weeks, that had nothing to do with anything that Mrs Gunders had said to you, had it?---No.
  1. And might I suggest to you that it was because you were extremely busyat this time?---I would probably say I was extremely busy. Yes.
  1. And do you agree that that is the reason why there was that delay between 16 September and 4 October?---I’d need to have a look - go back and have a look at my scheduling for then, but fair to say, I would say.
  1. Maybe. Yeah.
  1. HIS HONOUR: It was a busy time for conveyances at that time?---It is.”
  1. [20]
    Concerning the conversation between Ms Kerr and Ms Gunders on 5 December 2022 in her affidavit of 14 June 2023 Ms Kerr said:
  1. “12.
    I recall Gunders suggesting in this conversation that we should try to arrange for settlement in the New Year due to pressures with other settlements before the Christmas closure. I advised her that my preference was for settlement pre closures if possible, as I wanted the file finished. I understood from this discussion, by her suggestion to settle in the new year that extending time was not an issue for the purchaser.”
  1. And in her affidavit of 28 July 2023 she said:
  1. “17.
    In relation to the discussion with Ms Gunders at about 2.45pm on 5 December 2022, the only reason I telephoned her was to pass on the information about when the HIE consents would be signed and to see whether the buyer could settle before Christmas. My recollection is that the conversation was to the following effect:
  1. (a)
    I said words to the effect that:
  1. (i)
    the HIE consents would be signed on or by 12 December 2022;
  1. (ii)
    HIE required at least 7 days’ notice of settlement in order to undertake final meter readings;
  1. (iii)
    HIE’s office was closed between 24 December 2022 and 9 January 2023;
  1. (iv)
    once the consents were provided there would only be a window of a few days to trigger and complete settlement before HIE’s office closed, so the parties would have to work hard to ‘make it happen’ before that time;
  1. (v)
    the sellers were willing to settle the contract in 2022;
  1. (vi)
    if they (i.e. the buyer) couldn’t settle in 2022 I wanted to know when in January 2023 settlement could occur;
  1. (vii)
    “I don’t want this shit show on my desk in 2023”;
  1. (b)
    Ms Gunders laughed at the comment in sub-paragraph (vii) above and said words to the effect that:
  1. (i)
    it will be difficult to settle in 2022 given the matters referred to by me;
  1. (ii)
    she had a substantial work load on other files to complete before the PD Law office closed on 23 December 2022;
  1. (iii)
    she would have difficulty arranging settlement on behalf of the buyer before Christmas;
  1. (iv)
    it would be easier to push settlement to early January 2023 and that is what she would prefer;
  1. (c)
    We discussed possible dates in January 2023 that would be suitable and I said I would send an email confirming my position.
  1. 18.
    As a consequence, I sent an email to Ms Gunders at 2.56pm on 5 December.
  1. 19.
    There was no response to the email referred to in the above paragraph.
  1. 20.
    During the course of the discussion referred to above, there was no indication from Ms Gunders that the matter was going to progress in any way other than that once the consents were obtained the required date for settlement would be agreed thereafter.”
  1. [21]
    Ms Gunders, in her affidavit 1 August 2023 said:
  1. “31.
    At approximately 2.45pm on 5 December 2022, I received a call from Ms Kerr who called to:
  1. a.
    Advise that HIE’s office was closed from 24 December 2022 to 9 January 2023 and that they would not be able to complete any utility reads or take any steps for Settlement during that time (HIE Christmas Closure Period).
  1. b.
    Discuss the Sunset Date and the Settlement Date under the Contract which at this time of the conversation was due on 9 December 2022.
  1. c.
    Provide an update from HIE who told Ms Kerr that HIE consents should be signed on Monday [calculated as 12 December 2022] and that following receipt of those consents Ms Kerr would be looking to settle the Contract.
  1. d.
    Enquire as to whether the Applicant wanted Settlement to take place before Christmas office closures.
  1. 32.
    In response to Ms Kerr’s above comments I:
  1. a.
    Told Ms Kerr that the Applicant would prefer to settle on the Settlement Date in the Contract which was 7 days from the obtaining Consents which had not occurred as yet. It was futile to discuss extensions or variations to the Settlement Date when Consents had not yet been provided as calculation of the Settlement Date is dependent on the Consents being obtained. On this basis any discussion about calculation of Settlement Date and whether it would fall inside the HIE Christmas Closure Period was hypothetical as it was subject to Consents being obtained and dates being calculated.
  1. b.
    Noted that if the Consents are obtained and Settlement (calculated in accordance with the Contract Terms) falls into the HIE Christmas Closure Period, then Settlement will need to occur after HIE Christmas Closure Period.
  1. c.
    Discussed the timeframes for searches to be undertaken and told Ms Kerr that pending when Consents are obtained it may be difficult for these searches to be completed before the HIE Christmas Closure Period, and so Settlement may need to be extended to the beginning of January 2023.
  1. d.
    Discussed with Ms Kerr the Sunset Date and the fact that she may want to request an extension of the Sunset Date, because Consents had not yet been obtained and that on receipt of that request, I would take instruction from Applicant on that request. Ms Kerr had indicated that she would send through a request to extend the Sunset Date to 12 January 2023.
  1. e.
    Told Ms Kerr, in relation to her proposed extension request, words to the effect of it sounded like a plan for the Respondents to request an extension given the above circumstances. In response to Ms Kerr’s query on whether the Applicant would be agreeable to the extension I told Ms Kerr that I didn’t think they would have an issue but that I would need to take their instructions o the request once it is received, as I had not discussed this potential extension with them.
  1. 33.
    I recall this conversation with Ms Kerr but my recollection was also assisted by a file note I prepared at 2.56pm on 5 December 2022.”
  1. [22]
    In her cross examination by Mr Evans Ms Gunders said:[12]
  1. “
    Can I come to the 5th of December conversation?---Yes.
  1. Now, you’ve made a file note of this conversation, haven’t you?---Yes.
  1. I might just go through in a bit of detail, this conversation. Now, Ms Kerr phoned you at 2.45 pm or thereabouts - - -?---Approximately.
  1. - - - on the 5th of December?---Approximately that time.
  1. And when you spoke, she passed on the information that she’d just received from HIE about when the consents would be provided?---She told me that they would be signed on the 12th.
  1. Yes. Thank you. And at this time, there had been a couple of extensions already to the sunset date?---Yes.
  1. So when - at the time that you were having this conversation, the sunset date was the 9th of December?---Yes.
  1. So a few days after the conversation. And she’s just told you that the consents would be provided on the 12th of December, which is, again, after the sunset date. I might, for the purpose of - I’m just - I’m going to go through some dates in December and I don’t want anyone to be confused about it. I might just put a document on the visualiser. Do you see that in front of you?---Yes.
  1. What the document is, is an extract of a calendar for December 2022, and it shows which dates fall on which days of the week? Would you accept that as an accurate - - -?---Yes.              - - - description? Thank you. Now, Ms Kerr told you that the last consents - or the consents from HIE were going to be signed on the 12th of December?---That’s when they told - HIE told her.
  1. That was the information that she had. These were the last consents to be provided under the contract?---I wasn’t aware at the time whether Westpac had consented or not or signed the consents, but yes, we had Development Company consents.
  1. Okay. Now, you would’ve known, of course, that a right to terminate would arise if the sunset date on the 9th of December passed without the consents being obtained?---Yes.
  1. Or without a notice being given in accordance with the contract?---Yes.
  1. Or without an extension - - -?---Yes.
  1. - - of the sunset date being agreed. Now, in the conversation, Ms Kerr said to you words to the effect that she wanted to try and settle the contract as soon as these last consents were obtained. Was it - sorry, you have - you just have - - -?---Sorry, yes.
  1. - - to say yes or no. Thank you?---Yes. Sorry.
  1. And she asked you whether your client wanted to settle to contract in 2023 or try and settle it before Christmas in 2022?---Yes.”
  1. And:[13]
  1. “
    When you were having this conversation, it seemed to be pretty much off the cards that settlement could be triggered on the 9th of December?- --Which conversation are you referring to?
  1. Sorry.  I’m talking about the conversation between you and Ms Kerr - - -?---Yep.
  1. - - on the 5th of December. Now, the context of that conversation was she told you that the consents were likely to be signed on the 12th?--- Yes.
  1. It seemed like it wasn’t going to happen, or the notice wasn’t going to happen, on the 9th, didn’t it?---Yes.
  1. So it seemed likely that some sort of further extension of the sunset date was going to be required?---Yes.
  1. It was just a question of how long?---Yes.
  1. Now, the conversation on the 5th of December was left on the basis that you weren’t then in a position to fix a settlement date, of course?--- Correct.
  1. You both wanted to complete the transaction?---Yes.
  1. Settlement might occur in 2022, but it seemed more likely that it would occur in 2023?---Possibly.
  1. And in either event, an extension was going to be required of the sunset date?---On the 9th, yes.
  1. And you were going to check with your client about whether they particularly wanted to settle in 2022?---I was gonna get instructions from my client once Karen sent me a formal request with what her clients wanted her to do.
  1. Yes. And so the conversation was left on the basis that Ms Kerr was going to send an email to you so that you could take instructions?--- Yes.”
  1. [23]
    When cross examined by Mr Kelly concerning the conversation of 5 December 2022 Ms Kerr said:[14]
  1. “
    MR KELLY: On 5 December 2022, which is getting close to the point in time where the buyer says it terminated the contract, you had another conversation with Ms Gunders by phone on that date, didn’t you?---On the 5th of December?
  1. Yes?---Yeah, correct.
  1. And it was during that conversation that you made inquiries about whether the buyers wanted to have a settlement before Christmas?--- Yes, correct.
  1. And you would accept that whilst the buyers and, indeed, your client may have a preferable position, really, when settlement occurs is dependent upon when those consents are received, isn’t it?---Yeah.
  1. So a party can want all it pleases?---Of course.
  1. Until those consents are in the hand, the matter can’t proceed to settlement. You accept that?---Says when the con - consents are obtained - - -
  1. Yes?---Does it actually say in - physically in your hands?
  1. Well, that’s another issue - - -?---Okay.
  1. - - for the court?---Yeah.
  1. But the requirement of the clause is for them to be obtained. For whatever that may mean, you accept that until they are obtained - - -?---Yeah.
  1. - - the parties can want all they want, but they can’t settle?--- Absolutely.
  1. Now, Ms Gunders told you that during that conversation of 5 December, that her clients would prefer to settle on the settlement date in the contract, which was seven days from the date that you - the consents were obtained, didn’t she?---That conversation was - I was pressing for pre-Christmas settlement, and in that conversation, we were talking about the logistics of closures, getting agrees, etcetera. I don’t recall - no settlement is seven days, because previously, I was told it was 14 days.
  1. And you accept that that’s the wrong advice. It was seven days, not 14?---I accept it was seven days, not 14.
  1. Yes. So - just so we can be clear, I will put that question to you again. Ms Gunders said to you that her clients would prefer to settle on the settlement date in the contract?---I don’t recall those particular words.
  1. She also said to you words to the effect - this is not verbatim. She said words to the effect that it was - there was really no point in discussing a settlement date at that stage or extensions or variations to the settlement date because the consents hadn’t been obtained and settlement was dependent on those turning up?---Well, I was pre- empting that we would have them.
  1. All right. But my question is, Ms Gunders - the proposition I’ve put to you is that Ms Gunders said that to you, that there was no point in discussing settlement dates because it was futile until the consents were received?---I don’t rec - recall those sort of phrases, no.
  1. And she said that whether or not the settlement date falls outside of the closure period for HIE or not was really hypothetical at that stage?--- There’s also the Christmas closure.
  1. If you could just stick for the moment - - -?---Sorry.
  1. - - - because - that’s all right. But just to my question of whether you recall her saying that to you?---Could you repeat that, please.
  1. So Ms Gunders said to you that any discussion about calculation of the settlement date and whether it fell outside the Christmas closure period of HIE was hypothetical because it was all based upon these consents being obtained?---Well, yes.
  1. And she said to you that if the consents are obtained and settlement falls in the HIE Christmas closure period, then the settlement will need to happen after the Christmas closure?---Yes. Correct.
  1. And Ms Kerr - Ms Gunders also said to you in the discussion about obtaining searches for the settlement, that depending on when consents were obtained, it would be - it might be difficult for those searches to be completed before the HIE closure period and so, settlement might need to be extended to the beginning of January. Do you recall her saying that?---Well, yes. That was a given. If they were closed, they couldn’t do the reads.
  1. And - but do you recall her saying that to you?---I recall us discussing it.
  1. Yes?---I don’t recall those exact words, but yes. That was the - the vein of the conversation.
  1. Yeah. And the two of us discussed the fact that you might want to request an extension to the sunset date because the consents hadn’t been obtained?---We were talking about it going into the new year, correct.
  1. And Ms Gunders said that on - effectively, on receipt of your request, she’d take some instructions from her clients about that?--- Conveyancing 101. Of course she needs to get instructions. I was trying to push for pre-Christmas.
  1. And I put it to you - and that’s entirely right. Conveyancing 101, you don’t act without instructions, but she said to you that she’d take some instructions about that?---I’m sure - I’m sure, in her experience, she would’ve said something like that. Of course she would’ve.
  1. Yes?---I don’t recall word for word the conversation.
  1. No. That’s okay. Just doing the best you can. And you indicated to - or you said words to the effect that you’d send through a request to extend the sunset date to 12 January 2023?---Well, yes, but I was also hoping that she would speak with her clients about a pre-Christmas settlement.
  1. And Ms Gunders said to you words to the effect of referring to you requesting an extension to the sunset date, that “sounded like a plan.” Do you remember her saying that? You’ll just have to answer - - -?--- That was - - -
  1. - - - yes or no?---Yeah. Well, yes. We were trying to work a plan out to get the matter settled.
  1. And you asked about the likelihood of the buyers being agreeable to the extension?---Yes, I did - - -
  1. And - - -?---- - - if it went over into the new year.
  1. Yes. And Ms Gunders said to you that she didn’t think they’d have an issue with that, but she’d need to take their instructions once she received the request. Do you recall that?---Well, yes.
  1. Just bear with me a moment, Ms Kerr. One thing that Ms Gunders didn’t say - that she wanted to push the settlement into 2023 or that wasn’t referenced. She didn’t say those things, though?---No, I don’t recall that.
  1. And she didn’t say that her buyer clients would agree to an extension of the sunset date, did she?---She never used that phrase, no. It was indicated - we were - it was - we were talking the commercial side of it.
  1. And I think before you accepted the - I think you put it as “conveyancing 101,” people need to take instructions before - - -?--- Yeah. Of course.”
  1. The findings on the conversations and disputed evidence
  1. [24]
    I have mentioned that there were two conversations between Ms Gunders and Ms Kerr on 22 August and 5 December.[15] Because of differences between them as to what was said it is necessary to make some findings. Ms Gunders made a diary note of the conversation on 5 December.[16] It is apparent from that diary note and the evidence of both Ms Gunders and Ms Kerr that the parties were in the sense at the crossroads. Should an attempt be made to settle before the Christmas break and holiday shutdown or should settlement be extended into the New Year? Both conveyancers were of the same mind, that it was necessary for Ms Kerr to obtain instructions from her client and make a proposal to Ms Gunders. Ms Gunders was to await a formal request by Ms Kerr and to then obtain instructions.[17]
  1. [25]
    The foregoing explains why both sides paid close attention to the letter of 5 December[18] and the respective solicitors understanding of it.
  1. [26]
    What does emerge from the evidence of both concerning the 5 December letter is that neither understood the letter was a request for an extension of either the sunset day or the settlement day into the new year. What does in my view emerge from the evidence is that neither Ms Gunders nor Ms Kerr understood the letter as a request for an extension nor as an unequivocal confirmation that settlement should occur before Christmas. Ms Kerr’s evidence was unequivocal, she did not hold instructions from her client to make a request for an extension of time, she did not intend that the letter be understood as a request for an extension. She was “just putting it out there.”[19] Ms Gunders did not understand the email as a request for her client to advise if they wanted to settle before the business break. She did not understand the letter as a formal request asking for something. She accepted that the letter could be interpreted as a request for advice whether her clients wanted to settle earlier than January[20] but I do not understand her agreement of that interpretation called for a response. She was waiting for Ms Kerr to make a proposal on instructions so she could obtain instructions.[21]
  1. [27]
    Both Ms Kerr and Ms Gunders were experienced conveyancers. But Ms Gunders had considerable experience with conveying Hamilton Island properties (such as the two apartments in question). Ms Kerr did not have that experience. Ms Gunders explained to her some of the requirements of the contracts. Ms Gunders impressed me when she gave evidence under cross examination. She demonstrated intelligence, experience and was articulate thereby demonstrating an understanding of her client’s obligations as a buyer under the contract. Whereas at times I was left with the distinct impression that Ms Kerr was feeling her way concerning both conversations. It was apparent when giving evidence that Ms Kerr was experienced but I have a preference for Ms Gunder’s evidence over Ms Kerr’s where they diverged concerning both conversations. Another reason for my preference emerges from a comparison of the diary notes, exhibit 3 from Ms Gunders and exhibit 6 from Ms Kerr. Neither was suggested to be a comprehensive account of the conversation that day. No one suggested they were verbatim accounts, plainly they are not. But that of Ms Gunders more accurately reflected the conversation as I have found it.
  1. The sellers’ contentions and consideration
  1. [28]
    In the closing written submissions the respondents’ counsel broadly speaking advanced four grounds in support of the contention that the applicant buyer was not entitled to terminate the contract on 14 December 2022; waiver, estoppel, thirdly that the buyer was not permitted to take advantage of his own wrong and lastly that, on the proper construction of the contract, the conditions for termination did not exist.[22] But before considering these issues in the context of the evidence and my findings it is necessary to consider whether time had ceased to be essential, an issue raised by the respondents in their Points of Claim.
  1. [29]
    Clause 10 of the contract provided that time was of the essence.[23] On two occasions extensions were sought and granted for obtaining all the consents, Cl 13.1 referred to; from 31 October 2022 to 28 November 2022[24] and from 28 November 2022 to 9 December 2022.[25] On both occasions the sellers stipulated that time remained of the essence. That time was or remained essential was implicitly acknowledged by the seller’s solicitors in their email of 13 December 2022.[26]
  1. [30]
    The documentary correspondence is consistent only with the circumstance being that time was and remained of the essence. The parties’ legal representatives conducted themselves on that basis, there was no communication or conduct that permits a conclusion that time ceased to be essential.[27]
  1. [31]
    Nor was there a clear and unequivocal representation by Ms Gunders that her clients would agree to an extension beyond 9 December 2022 for the consents and would not insist upon the obtaining of consents as of 9 December 2022.[28] The findings I have made concerning the conversations on 22 August and 5 December 2022[29] do not permit that. There was no written communication to that effect.
  1. [32]
    My preference for the evidence of Ms Gunders has a consequence for the submissions made on behalf of the respondents concerning both waiver and estoppel. In closing submissions on behalf of the respondent sellers Mr Evans of counsel was inclined to accept that if I concluded that Ms Gunders evidence concerning the conversations should be accepted in preference to Ms Kerr’s that would have fatal consequences for the respondent’s contentions upon the waiver and estoppel.[30]
  1. [33]
    It should not be overlooked that the written outlines of both counsel[31] were written in advance of the hearing and before the solicitors were cross examined.
  1. [34]
    In his submissions Mr Evans referred to authorities that established that the words or conduct required to demonstrate a waiver may be express or implied but must be unequivocal.[32] The evidence from the documents and Ms Gunders (whose evidence I prefer) does not admit of an unequivocal waiver of a right to terminate if all of the consents required by the contract were not relevantly obtained on or before 9 December 2022.
  1. [35]
    To like effect the sellers’ case on estoppel fails in light of the documentary evidence and my acceptance of Ms Gunders’ evidence. Referring to Legione v Hateley[33] Mr Evans submitted, correctly, that a representation to establish an estoppel must be clear and unequivocal though it need not be express. The evidence as I find it to be does not establish an unequivocal representation that the buyer would not elect to terminate the contract if all of the consents required by the contract were not relevantly obtained on or before 9 December 2022.
  1. [36]
    I turn to the consideration of the seller’s contention that the buyer was not permitted to take advantage of its wrongdoing by terminating in the circumstances. It was submitted that a party to a contract cannot take advantage of its own non-compliance in breach of contract. In particular it was submitted that the buyer, in breach of Cl 13.2 of the contract, cooperated with the seller in not promptly after execution of the contract taking necessary steps to obtain the consents mentioned in Cl 13.1. The submission is unattractive in light of the express stipulation in Cl 13.2 that it was the sellers obligation to act promptly. But the sellers drew attention to both Cl 13.4 which obliged both buyer and seller to promptly do all acts necessary to expedite obtaining consents and also a breach by the buyer arising from the delay in the submission of transfer documents on 26 August when Cl 13.3 required that they be provided on 12 August.
  1. [37]
    In the context of the evidence and the discussions between the solicitors on 22 August 2022 the breach concerning transfer documents pointed to by the sellers is immaterial having no effect or consequence in bringing about the circumstances confronting the parties some months later in December. The breach, such as it was, was relevantly trivial in context and did not bring about or cause the buyers entitlement to terminate.
  1. [38]
    The obligation Cl 13.4 imposed upon the buyer did not operate to result in the circumstances as they stood in December 2022. In the conversation between the solicitors on 22 August mention was made of a practice of not going to the expense of obtaining consents until the contract became unconditional with respect to the building and pest reports the subject of Cl 22. As it transpired the building and pest condition was not satisfied until 16 September 2022. As of 16 September the “sunset date” for obtaining the consents required by Cl 17.2 of 31 October 2022 gave more than enough time for the provision of consents and settlement. In my view the delay occasioned by waiting for the building inspection and pest report did not materially contribute to the failure to have consents by 31 October 2022 let alone 9 December 2022.
  1. [39]
    There is no substance to the seller’s submission.
  1. [40]
    The respondent sellers submit that upon the proper construction of the contract that the obligation to “obtain” a consent in Cl 13 is met when the consenting party gives its formal approval to the transaction by signing the consent and not when evidence of apparent consent is given to the buyer. It is uncontroversial that the Westpac consents were signed (but not delivered) on 29 November 2022 and the HIE consents were signed on 12 December before the purported termination on 14 December. Thus it is submitted, that the consents were relevantly “obtained” within the meaning of Cl 17.2 before termination.
  1. [41]
    It is apparent that it was not until 1:30 pm on 14 December 2022 that copies of the relevant outstanding consents were in the possession of Ms Kerr. The letter of termination had been sent by Ms Gunders to Ms Kerr earlier on 14 December at 11:16 am.
  1. [42]
    The principles governing the construction of commercial contracts are well settled and uncontroversial.[34]
  1. [43]
    The construction contended by the sellers is unattractive. Its effect is that a consent is relevantly “obtained” once a consenting party signs a document and before the solicitors for the contracting parties have seen it nor have a reliable copy in possession. The implications of this construction are unattractive. Its consequence might be that either buyer or seller (or both) would not know whether there was an extant right to terminate or of the settlement date notwithstanding that rights may have been triggered by an unknown event. The better interpretation of the word “obtain” used in clauses 13 and 17 of the contract is that it occurs when a reliable copy relevantly signed or executed is in the possession of the seller and its existence communicated to the buyer. The sellers have not persuaded me of their interpretation.
  1. [44]
    The extended date for obtaining the consents of 9 December 2022 passed and HIE had not consented. Time was of the essence. My conclusion is that the buyer was thereafter entitled, if it chose, to elect to terminate. The letter of termination was sent at 11:16 am on 14 December 2022 before 1:30 pm that day when Ms Kerr received the email attaching the signed consents.
  1. [45]
    The termination was lawful. The applicant buyer has made its case for a declaration and the refund of the deposit.
  1. [46]
    I will make orders in terms of the draft[35] submitted by the applicant buyer for a declaration and an order for payment of the monies paid into Court.
  1. [47]
    In his written submissions counsel for the respondent sellers indicated his client wanted the opportunity to make submissions with respect to costs. In the circumstances I will make an order for the exchange of short written outlines on the issue of costs with the issue to be determined on the papers.
  1. Orders
  1. [48]
    The orders will be:
  1. 1.
    It is declared that on 14 December 2022, the applicant validly terminated a contract of sale dated 2 August 2022 between the applicant and the respondent in respect of the sale and purchase of two sub-sub-leases having registered dealing numbers 602816638 and 602816639, and 252,000 ordinary shares in the capital of Hamilton Island Development A Pty Ltd ACN 010 254 190 numbered 546,001 to 798,000 inclusive.
  1. 2.
    The sum of $128,500 paid into court in this proceeding on 30 May 2023 be paid out to the applicant, together with any accretions.
  1. 3.
    Within 14 days the parties are to exchange and file written submissions with respect to costs (not to exceed two pages).
  1. 4.
    The costs are to be determined “on the papers” without appearance in person.

Bulwer Pty Ltd v Ryan [2024] QSC 155

Bulwer Pty Ltd v Ryan [2024] QSC 155

Bulwer Pty Ltd v Ryan [2024] QSC 155

Bulwer Pty Ltd v Ryan [2024] QSC 155

Bulwer Pty Ltd v Ryan [2024] QSC 155

Bulwer Pty Ltd v Ryan [2024] QSC 155

Bulwer Pty Ltd v Ryan [2024] QSC 155

Bulwer Pty Ltd v Ryan [2024] QSC 155

Bulwer Pty Ltd v Ryan [2024] QSC 155

Bulwer Pty Ltd v Ryan [2024] QSC 155

Bulwer Pty Ltd v Ryan [2024] QSC 155

Bulwer Pty Ltd v Ryan [2024] QSC 155

Bulwer Pty Ltd v Ryan [2024] QSC 155

Bulwer Pty Ltd v Ryan [2024] QSC 155

Footnotes

[1]  And some chattels.

[2]  Exhibit 9.

[3]  Ms Gunders affirmed three affidavits:

a) filed 4 May 2023 (Court File No. 2);

b) filed 19 June 2023 (Court File No. 12); and

c) filed 1 August 2023 (Court File No. 25).

Ms Kerr affirmed two affidavits:

a) filed 15 June 2023 (Court File No. 11); and

b) filed 28 July 2023 (Court File No. 23).

[4]  Ms Gunders’ evidence at T1-18ff and Ms Kerr’s at T1-51ff.

[5]  Exhibit 9.

[6]  Exhibit 1.

[7]  “Chronology Annexure”.

[8]  See Exhibit 7.

[9]  See Ms Gunders’ affidavit filed on 1 August 2023. (Court File No 25)

[10]  See T1-21 l47 to T1-24 l34.

[11]  See T1-54 l12 to T1-58 l26.

[12]  See T1-24 l36 to T1-25 l40.

[13] T1-36 l6-l40.

[14]  See T1-59 l34 to T1-62 l20.

[15]  See [17] above.

[16]  Exhibit 3. It can be noted that Ms Kerr’s corresponding diary note of the conversation is Exhibit 6.

[17]  See [22] and [23] above.

[18]  See [15] above.

[19]  See T1-63 l3-12.

[20]  See T1-32 l40 – 33 l25.

[21]  See T1-31 l34-40.

[22]  See MFI 4.

[23]  See [9] above.

[24]  See Exhibit 1 p279 – 280.

[25]  See Exhibit 1 p351 & 352.

[26]  See Exhibit 1 p360.

[27]  See McPhee v Zarb & Ors [2002] QCA 530 per Williams JA at [20]-[21].

[28]  Consider for example Legione v Hateley (1982) 152 CLR 406 per Mason and Deane JJ at [438] and [440].

[29]  See [26] and [27] above.

[30]  See T1-67 l43 to 69 l10.

[31]  MFI 1, Mr Kelly for the applicant buyer, and MFI 4, Mr Evans for the respondent sellers.

[32]  Referring to Prospect Resources v Mulyneux [2015] NSWCA 171, [68].

[33]Legione v Hateley (1982) 152 CLR 406 at [438] - [440].

[34]Mount Bruce Mining Pty Ltd v Wright Prospecting (2015) 256 CLR 104 at [46]-[51] and Victoria v Tatts Group Limited (2016) 328 ALR 564 at [51].

[35]  See MFI 3.

Close

Editorial Notes

  • Published Case Name:

    Bulwer Pty Ltd v Ryan

  • Shortened Case Name:

    Bulwer Pty Ltd v Ryan

  • MNC:

    [2024] QSC 155

  • Court:

    QSC

  • Judge(s):

    North J

  • Date:

    25 Jul 2024

  • White Star Case:

    Yes

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

Cases Cited

Case NameFull CitationFrequency
Legione v Hatley (1982) 152 CLR 406
3 citations
Jump To
Cite 1 - (1982) 152 CLR 406
Cite 2 - (1982) 152 CLR 406
Cite 3 - (1982) 152 CLR 406
McPhee v Zarb [2002] QCA 530
2 citations
Jump To
Cite 1 - [2002] QCA 530
Cite 2 - [2002] QCA 530
Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104
2 citations
Jump To
Cite 1 - (2015) 256 CLR 104
Cite 2 - (2015) 256 CLR 104
Prospect Resources Ltd v Molyneux [2015] NSWCA 171
2 citations
Jump To
Cite 1 - [2015] NSWCA 171
Cite 2 - [2015] NSWCA 171
Victoria v Tatts Group Limited (2016) 328 ALR 564
2 citations
Jump To
Cite 1 - (2016) 328 ALR 564
Cite 2 - (2016) 328 ALR 564

Cases Citing

No judgments on Queensland Judgments cite this judgment.

1

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