In brief - Purchaser fails to complete and vendor terminates
Pantlin v King involved a contract which was exchanged
for the sale of a property with a 5% deposit and an extended
settlement. The purchaser failed to complete. After a number of
extensions, the vendor terminated the contract.
Ultimately, the vendor's notice to complete was upheld and
the vendor was entitled to release of the deposit and damages.
Notice to complete held to be valid
The court held that the vendor's solicitor was not bound to
answer requisitions out of time but in any event had done so on a
without prejudice basis and that the answers had been sent (even
though the purchaser denied that she had received them).
The notice to complete was held to be valid and to have been
delivered in accordance with the terms of the contract (even
though, again, the purchaser denied she received it). It was also
held that by virtue of the provisions of the contract, a 14 day
period was a reasonable period to require completion.
Wisely, the solicitor for the vendor attended the place of
settlement on the settlement date in the notice to complete and
waited for about an hour to establish that the purchaser would not
The vendor's notice of termination issued was therefore
Court rejects purchaser's claim that property substantially
The purchaser maintained that there was substantial damage to
the property, both at the time the notice to complete was issued
and at the time set down for completion, and that the purchaser was
therefore not required to settle.
On the facts, the court found that, subject to one minor item,
the condition of the premises was in the same state as it was at
the time the purchaser had exchanged contracts. The one item that
it was proven had been damaged between exchange and settlement
could have been rectified for a fairly minimal cost (about $300, on
the evidence) and this did not entitle the purchaser to delay
Vendor attempts to claim capital gains tax from purchaser
One of the major issues for the vendor was that, as the property
had not sold within two years of the death of former registered
proprietor, capital gains tax was payable.
The vendor sought to claim this from the purchaser as well as
the other damages and forfeiture of deposit.
However, as the vendor did not seek to resell the property
within 12 months of the contract's termination, as required by
the standard form of contract, this head of damages was held not to
be recoverable. The court held that the vendor could have resold
the property and still have brought proceedings against the
purchaser for damages and that the vendor had an obligation to
mitigate his loss and therefore this head of damage was not
Party which terminates contract and seeks damages must mitigate
Firstly, it is essential that someone seeking to rely on a
notice to complete does all that is necessary to demonstrate to the
courts that the person is ready, willing and able to settle on the
Secondly, it is essential that a party who terminates the
contract and then seeks damages has done all that it is able to do
to mitigate its loss and is cognisant of the provisions of the
standard contract in New South Wales requiring a claim to be made
within 12 months, so any action that needs to be taken to mitigate
losses needs to be undertaken within this period.
The Council announced planning policies to encourage more inner suburban retirement village and aged care development.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).