Federal Court of Australia Creative Property Holdings Pty Ltd (Trustee) v Car Parks Super Pty Ltd (Trustee) [2021] FCA 1478 File number(s): TAD 3 of 2021 Judgment of: O'CALLAGHAN J Date of judgment: 26 November 2021 Catchwords: CONTRACTS – claim for specific performance of a contract for the sale of land – whether binding contract for the sale of land – whether parties intended to be bound only upon the exchange of counterparts – Eccles v Bryant and Pollock [1948] 1 Ch 93 considered and applied CONSUMER LAW – whether by making of offer to sell land respondent engaged in conduct that was misleading and deceptive in breach of s 18 of the Australian Consumer Law Legislation: Competition and Consumer Act 2010 (Cth) Schedule 2 s 18 Cases cited: Chillingworth v Esche [1924] 1 Ch 97 Eccles v Bryant and Pollock [1948] 1 Ch 93 Rana v Google Inc (2017) 254 FCR 1 Sindel v Georgiou (1984) 154 CLR 661 Division: General Division Registry: Tasmania National Practice Area: Commercial and Corporations Sub-area: Commercial Contracts, Banking, Finance and Insurance Number of paragraphs: 140 Date of hearing: 22 October 2021 Counsel for the Applicant: Mr C Gunson SC with Mr D Edney Solicitor for the Applicant: Blackwattle Legal Counsel for the First Respondent: Mr SB McElwaine SC Solicitor for the First Respondent: Archer Bushby Lawyers Solicitor for the Second Respondent: Mr P Lunn of Simmons Wolfhagen Lawyers ORDERS TAD 3 of 2021 BETWEEN: CREATIVE PROPERTY HOLDINGS PTY LTD (ACN 637 144 542) AS TRUSTEE FOR THE CREATIVE PROPERTY HOLDINGS UNIT TRUST Applicant AND: CAR PARKS SUPER PTY LTD (ACN 607 566 094) AS TRUSTEE FOR THE ALLEN FAMILY SUPERANNUATION FUND First Respondent LAUNCESTON CITY COUNCIL Second Respondent order made by: O'CALLAGHAN J DATE OF ORDER: 26 November 2021 THE COURT ORDERS THAT: 1. The applicant's claim be dismissed, with costs. 2. Within seven days, the parties file any submissions that they may choose to rely on in relation to the question of the return of the deposit referred to in [133]-[139] of these reasons. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT O'CALLAGHAN J: Introduction 1 In 1947, Lord Greene MR described the case before him as "one of that long series of cases which no doubt will go on as long as contracts take place, in which one party to a transaction, which was intended to produce a contract and was carried on on the usual condition that it was to be subject to contract, is attempting to say that a contract came into existence at a date on which the other party says that negotiations had not yet been completed and that no binding contract had come into existence at all". See Eccles v Bryant and Pollock [1948] 1 Ch 93 at 96. 2 This is such a case. Here, Creative Property Holdings Pty Ltd as trustee for the Creative Property Holdings Unit Trust (the applicant), claims that it formed a binding contract with the first respondent, Car Parks Super Pty Ltd as trustee for the Allen Family Superannuation Fund (the respondent), for the sale of land owned by the respondent at 41-43 Paterson Street in Launceston. The second respondent, the Launceston City Council (the Council), was the guarantor of the applicant's obligations. The Council appeared at the hearing, saying that it took a "neutral role", which I take to mean that it would abide the result. 3 The parties agreed, and it is the case, that this court has jurisdiction to hear the matter because the applicant made a non-colourable claim under s 18 of Schedule 2 to the Competition and Consumer Act 2010 (Cth) (ACL). See eg the useful collection of cases summarised in Rana v Google Inc (2017) 254 FCR 1 at 7 [21] (Allsop CJ, Besanko and White JJ). 4 The parties argued the case by reference to an agreed bundle of documents. No witnesses were called. The applicant sought to rely on an affidavit of Christopher Billing dated 28 September 2021, but his evidence was irrelevant because it went to the deponent's subjective intentions. I accordingly declined to admit it into evidence. The parties agreed that the relevant intention of the parties is to be determined objectively on the basis of the exchanged correspondence. 5 At one stage, earlier on, the parties had suggested that I should decide the matter "on the papers". Having heard (albeit via Microsoft Teams) the able, and commendably concise, submissions by senior counsel for both the applicant and the respondent, I am convinced that it would have been unwise, and a false economy, to have done so. 6 As will become apparent from an examination of the correspondence exchanged between the respective solicitors for the parties, both the applicant and the respondent at various different times seemed, for want of a better expression, to have lacked enthusiasm to complete the transaction. Be that as it may, why that was so is of no moment for the purposes of deciding the pleaded issues. 7 Before turning to the pleaded case and to the facts, it is helpful to give a brief "who's who". Viridian Lawyers (VL) were the solicitors for and agent of the (purchaser) applicant. Mr Richard Prangell was the solicitor responsible for the transaction. Archer Bushby Lawyers (ABL) were the solicitors for and agent of the (vendor) respondent. Ms Kate Alcorso was the solicitor responsible for the transaction. Simmons Wolfhagen Lawyers (SWL) were the solicitors for and agent of the Council. 8 The applicant's pleaded case was as follows. 9 On 20 November 2020, the respondent offered to sell the land situated at and known as 41-43 Paterson Street, Launceston, being the land more fully described in the folio of the Register kept by the Recorder of Titles under s 33 of the Land Titles Act 1980 (Tas) as volume 147031 folio 1 (the Property) to the applicant (the offer). 10 The offer was alleged to have been comprised of: (1) an email from ABL to VL dated 20 November 2020 at 4:44pm; (2) a letter from ABL to VL dated 20 November 2020; (3) a document entitled "625329 Contract 20.11.2020", being a "Standard Form Contract for Sale of Real Estate in Tasmania – The Particulars of Sale (2018)"; (4) a document entitled "RevisedStandardConditionsofSale 2018-05.07.18", being a "Standard Form Contract for Sale of Real Estate in Tasmania – The Standard Conditions of Sale (2018)"; and (5) a document entitled "625329 Lease", being a lease between the applicant as lessor and Donald Keith Allen and Janet Anne Allen as lessee in respect of the Property. 11 The applicant alleged that the terms of the offer included that: (1) the purchase price would be $12 million; (2) the deposit would be $1.2 million; (3) completion would take place on 4 December 2020; (4) the applicant would enter into a lease of the Property on the terms set out in the lease referred to at [10(5)] above; and (5) the Council would guarantee the applicant's obligations on the terms set out in the standard form contract referred to at [10(3)] above. 12 The applicant alleged that the respondent accepted the offer on 23 and 24 November 2020. 13 The acceptance was alleged to have been comprised of: (1) an email from VL to ABL dated 23 November 2020; (2) an email from VL to ABL dated 24 November 2020 at 2:16pm; (3) a document entitled "625329 Contract 20.11.20 copy SIGNED", being a copy of the standard form contract referred to at [10(3)] above, executed by the applicant; (4) a document entitled "RevisedStandardConditionsofSale 2018-05.08.18 copy SIGNED", being a copy of the document referred to at [10(4)] above executed by the applicant; (5) a document entitled "625329 Lease copy - SIGNED", being a copy of the document referred to at [10(5)] above, executed by the applicant; (6) an email from SWL to ABL dated 24 November 2020; and (7) a document entitled "City of Launceston Signed Contract - 41-43 Paterson Street", being a copy of the document referred to at [10(3)] above, executed by the Council. 14 It was alleged that on or about 24 November 2020, the Council executed the guarantee by affixing its common seal and attesting the document referred to at [10(3)] above, in accordance with s 19(5) of the Local Government Act 1993 (Tas). 15 The applicant's case was that upon the acceptance of the offer, a binding contract was formed between it and the respondent, the terms of which included those set out at paragraph [11] above. 16 The applicant also alleged that at the time the contract was formed, ABL held a deposit in the sum of $1.2 million. 17 The applicant alleged that on 4 December 2020, the respondent repudiated the contract in an email from ABL to VL which said: "I do not have instructions to exchange contracts for the Property at this point in time". 18 The applicant pleaded that in breach of the contract, the respondent has refused, failed, or neglected to complete the contract, and that it (the applicant) was and is ready, willing, and able to do so. 19 The ACL claim is as follows: 12. Further or alternatively, when the … respondent made the Offer [it] was engaged in trade or commerce. 13. By making the Offer the … respondent conveyed to the applicant a willingness to enter into a binding contract in the terms set out in the Offer. 14. At the time the … respondent made the Offer [it] did not intend to enter into a binding contract in the terms set out in the Offer upon acceptance of the Offer by the applicant. 15. In the circumstances the making of the Offer by the … respondent was conduct that was misleading or deceptive and in breach of s18 of the Australian Consumer Law (being sch 2 to the Competition and Consumer Act 2010 (Cth)) … 20 The applicant sought the following relief: 1. A declaration that the respondents are bound by the contract dated 23 November 2020 (Contract) for the purchase by the applicant from the first respondent the land situated at and known as 41-43 Paterson Street, Launceston in the State of Tasmania being more fully described in the folio of the Register kept by the Recorder of Titles under s33 of the Land Titles Act 1980 (Tas) volume 147031 folio 1 (Property). 2. An order that the first respondent specifically perform the Contract. 3. An injunction pursuant to s232(1) and (6) of the Australian Consumer Law (being sch 2 to the Competition and Consumer Act 2010 (Cth)) requiring the respondent to transfer to the applicant the Property on the terms set out in the Contract. 4. Such further or ancillary orders as the Court considers necessary for the purpose of giving effect to orders 1 and/or 2 hereof. 5. Damages (including pursuant to s236 of the Australian Consumer Law). 6. Costs. 21 The respondent denied the existence of the binding contract alleged. It pleaded, in substance, that: (1) it did no more than invite the applicant to treat with it, upon certain terms, for the sale of the Property; (2) if it did make an offer to sell the Property upon certain terms, it was not open to the applicant to accept that offer because it was subject to a requirement that the parties would not be bound absent exchange; (3) if a contract was entered into to sell the Property as contended by the applicant, the respondent validly terminated that contract by reason of the failure of the applicant to pay the deposit; and (4) the ACL claim is devoid of merit. 22 The factual material is much more extensive than the documents relied on by the applicant in its statement of claim said to prove a binding contract. It is necessary to have regard to additional correspondence, including to understand the parties' dealings with respect to the deposit. The facts 23 It was common ground that all of the facts relevant to the contractual formation, terms and termination questions are in writing. The relevant agreed documents were admitted into evidence as Exhibit 1. 24 I have, for the most part, when quoting from relevant letters and emails exchanged between the parties, omitted formal parts of the correspondence. 25 On 3 June 2020, ABL emailed to VL an undated contract for the sale of the Property, executed on behalf of the vendor, which provided for a purchase price of $12 million, with a deposit of $1.2 million to be paid three business days from the date of the contract. 26 The next day, VL emailed ABL, informing ABL that the applicant accepted "on the terms proposed". The email continued: "I am awaiting confirmation from Launceston City Council, and will contact you shortly concerning execution". Later the same day, VL emailed ABL pointing out "[o]n review, it appears that contract does not specify the land. Could you kindly reissue?" 27 About 15 minutes later, ABL emailed VL as follows: "I sincerely apologise for the error. The tabling on this contract is horrible, where insertion of extra fields does not seem to work properly and tends to have the effect of writing over other content. I have made the correction and double checked fully through (twice) to ensure that no content seems to have been lost due to the insertion. Please find attached for your review". Attached to that email was a Standard Form Contract for Sale of Real Estate in Tasmania which included the description of the Property set out at [9] above. It was not executed. 28 On 5 June, VL emailed ABL: "Thanks Kate, I completely understand. The contract is approved by council and my client is ready to sign. Is your client in a position to sign today?" A little under two hours later, VL again emailed ABL, as follows: "It is very significant to my client that we receive a signed copy from your client today. Please let me know if there is anything my client or I can [sic] to facilitate this". 29 Less than half an hour later, ABL emailed VL as follows: I had called my client and asked for an appointment before your email. He was not available today and made a time with me for Friday next week (his availability). However, I have now forwarded your email to him to put forward your client's position and asked if he can arrange earlier availability. Perhaps your client and Council could sign in the intervening time and the [sic] my client would be the final signatory to obtain. The original could be delivered to my office if it is desired that all parties sign on the one document. 30 On 11 June, VL emailed ABL: "Please find attached my client's executed Contract for the Sale of Real Estate. I will coordinate with council to arrange execution as soon as possible. Could you please confirm that your client is still scheduled to execute tomorrow?" 31 A little over an hour later, ABL emailed VL: "My client's appointment is still on the books for tomorrow. Thank you for your advice that your client has executed". 32 On 12 June, VL emailed ABL: "Can you kindly confirm if your client has executed today?" 33 On 15 June, ABL emailed VL: "My client is interested to know how your client progressed with facilitating Council's signing of the contract". 34 On 17 June, VL emailed ABL: "We confirm execution by both my client and council. We attach scanned counterpart copies for attention. We await receipt of your client's counterpart". 35 Two days later, VL emailed ABL asking for an update. 36 On 23 June, ABL emailed VL: "I apologise for not responding to this email nor returning your calls. I have been snowed under … I have an appointment with my client Thursday morning". 37 On 29 June, VL emailed ABL, again asking for an update. 38 On 30 June, ABL advised VL that a fresh appointment with the respondent had been arranged for the coming Friday because the appointment for the previous Thursday did not proceed. 39 On 6 July, VL wrote this letter to ABL: We refer to the above matter. 1. As you are aware, our respective clients have been in negotiations for the purchase of the land at 41-43 Paterson St, Launceston (Property) for some time. 2. On 2 June 2020 our office was in receipt of an executed contract for the sale of the Property (2 June Contract). 3. The 2 June Contract contained an error whereby the address for the Property was omitted as you inserted the Guarantor details in place of the Property details and did not reinstate the Property details. This error was corrected with apologies by your office on 4 June 2020 (4 June Contract). 4. At no time was there any ambiguity between the parties as to Property to be conveyed, and the 4 June Contract contained no other amendments. 5. On 11 June 2020, our client executed the 4 June Contract as purchaser, and a copy was returned to your office that day. 6. On 17 June 2020, Launceston City Council executed the 4 June Contract as guarantor, and a copy was returned to your office that day. 7. We have not received your client's executed counterpart to the 4 June Contract. We are informed that the delay has been administrative in nature. 8. It is abundantly clear that our respective clients, and Launceston City Council, have demonstrated an intention to be bound to the terms of the 4 June Contract. 9. Our client will proceed on the basis that the agreement is binding and effective as of close of business on 6 July 2020 with settlement due 60 days from this date. 10. In accordance with the terms of the 4 June Contract, our client will coordinate payment of the deposit on or before close of business on 9 July 2020. 11. Please confirm urgently that your office is instructed to receive the deposit sum and provide your trust account details. We await your response. 40 On 9 July, SWL wrote to ABL: "Enclosed is a bank cheque for $1,200,000 in payment of the deposit relating to the Contract of Sale for the Property. Please confirm receipt at your earliest convenience". (It seems that ABL retained possession of that bank cheque for some period of time and at some later stage, paid it into its trust account.) 41 On 3 September, Ms Alcorso (ABL) and Mr Prangell (VL) spoke on the telephone. Following that conversation, VL emailed ABL: Confirming the contents of our call today. As discussed, my client has proposed the following: 1. the parties will sign a new contract for the sale of land tomorrow; 2. the contract will be in the form previously agreed, with amendments as follows: 1. settlement to take place 1 week from execution, with a 2 week option to extend at my client's discretion; 2. the sale be described as a going concern, and not subject to GST. The parties can then negotiate terms under which your client may continue to maintain possession of the land next week. To this end, my client has proposed an arrangement whereby your client purchases a unit in the Creative Property Holdings unit trust for $3 million, which conveys special purpose rights to lease the land, or receive any profits from the land, until redeemed. We await your response. 42 Later that day, VL again emailed ABL: "Additionally, I have instructions from my client that he requires an in principle agreement in writing from your client today". 43 The next day, VL emailed ABL: "My client is concerned about the lack of communication from your firm today, given the current state of affairs between our clients. Please urgently advise as to status". 44 On the same day, ABL responded: My client had advised that I should expect to hear from you as my client had spoken to yours and he was considering what my client had put to him in relation to continued operation of the car park in an alternative arrangement to that proposed yesterday. I am gathering that has not occurred – your instructions remain the same? Please confirm and I will advise my client and seek instructions 45 A little under two hours later, ABL emailed VL again: "I have been instructed by my client to issue the attached contract to further negotiations between the parties. I look forward to your response". 46 The attached contract was again in the standard form. It described the Property and provided for a sale price of $12 million and a deposit of $1.2 million payable "on the Contract Date". No "Contract Date" was provided for. The completion date was specified as 23 December 2020. 47 About 15 minutes later, VL responded: Our client does not, and has not, agreed to delay settlement until December. Please find attached contract for execution as previously discussed and agreed between our respective clients. We request that you confirm acceptance as a matter of priority, and we will arrange a courier to your client's location for signing today. 48 The "attached contract" for execution was not contained in Exhibit 1, but the parties did not suggest that anything turned on that. 49 On 8 September, VL emailed ABL: "I am informed that your client will be signing a contract for the sale of land today. Can you please confirm if we are to expect a copy tomorrow?" 50 The next day, ABL emailed VL: "I refer to your email … and message left this morning. I can confirm I am in regular contact with my client. I will be in touch with a response when I receive instructions to do so. I understand our clients also remain in regular contact". 51 On 14 September, VL emailed ABL (emphasis in original): We refer to the above matter. As you are aware, our clients have been engaging in informal discussion to resolve the transfer of land between them. Despite substantial patience from my client, it is now apparent that your client has been negotiating in bad faith in an attempt to further delay settlement and/or avoid performance. As per our letter of 6 July 2020, it is abundantly clear that your client is bound to the terms of the contract executed on 4 June 2020. Nevertheless, my client proposes a video conference this week, with lawyers present, by way of one final attempt to come to a resolution concerning the settlement of the sale contract. If the parties are unable to proceed to execution of sale terms during this video conference, or if your client refuses or fails to attend, I have instructions to commence preparations to seek specific performance. My client requires a response on or before close of business on 15 September 2020 confirming in principal acceptance and a proposed meeting time. 52 ABL did not respond to that email. 53 On 16 September, VL wrote a letter to ABL. The letter was attached to an email which said, relevantly, "[p]lease be aware that our client will not enter into any further negotiations with your client, and requires that all future correspondence … be directed to this office. We note that if your client refuses the attached offer, or does not respond by close of business today, we are instructed to commence preparation to seek specific performance of the contract. Please confirm that you are instructed to accept service". 54 The letter attached to that email, which was headed "Without prejudice except as to costs", read (emphasis in original): We refer to the above matter, to our letter of 6 July 2020 and to our email correspondence of 14 September 2020. 1. We are instructed that our client is prepared to settle the dispute with your client on the following basis: (a) your client to execute the enclosed Contract for the Sale of Real Estate, on or before 18 September 2020; and (b) the purchase of the Site to complete on 25 September 2020; and (c) your client to take a commercial lease to operate the Site until 31 December 2020 for a fee of $50,000, payable at settlement. 2. This offer is made by our clients on the basis that, while it is without prejudice, it will be referred to any ultimate decision maker on the question of costs, and our clients reserve their right to place this letter, together with any response or failure to respond, before the court. In relation to the nature of this offer, we refer you to Calderbank v Calderbank [1976] 4 All ER 333. 3. This offer is open for acceptance until close of business today, 16 September 2020. 4. Our client reserves its rights. We await your response. 55 Later that day, ABL responded: On a without prejudice basis, I have been instructed to advise that the terms set out in points 1(a), (b) and (c) in the letter attached to your email are generally in order. However, I have been asked to clarify: 1. You refer to entry into a commercial lease. Does your client propose that you would draft that document? If so, would the document be available for the terms to be agreed prior to execution of the contract for sale (which I note is required by this Friday 18th September in your correspondence). I would suggest that either the lease terms would need to be agreed prior to execution of [sic] the contract should be conditional on entry into the lease. 2. The contract document you attached was missing the annexure page to the particulars of sale which included the GST provision. I am presuming this was in error as the particulars of contract still refer to 1 annexure page. 3. The proposed contract refers to the deposit as "Already paid, receipt acknowledged". The cheque for the deposit has never been cashed as our client's position has always been that that [sic] those points set out in your letter of 6 July 2020 did not have the effect of contract being in existence between the parties. Therefore, my client's preference for the wording in relation to the deposit would be "Already paid (subject to cheque clearance)". 56 Shortly thereafter, VL responded: 1. We will prepare a lease, to be made available tomorrow. If you have a preferred precedent form for a commercial lease, please provide a copy as a matter of priority. We note that the lease was at the request of your client, and this term is not material to our client. Our client is content to proceed to settlement with no lease. 2. This was an error. Corrected version attached. 3. We agree with this wording. See attached. 57 A few minutes later, ABL responded: "Thank you for your response with the amended contract[.] I am instructed the terms of offer set out in points 1(a) (with the contract as amended by this email) and 1(b) of your letter today are accepted. Our clients can discuss the leasing matter further between themselves further tomorrow and we can then consider further". 58 On 17 September, ABL emailed VL attaching "our lease precedent" and informing VL that "the tenant" would be Donald Keith Allen and Janet Anne Allen. 59 Shortly thereafter, VL emailed ABL attaching a draft lease. The email said, "[i]n the interests of expedience, and minimising matters to resolved [sic] between the parties, I have used your preferred precedent". 60 On 18 September, ABL emailed VL: "I hold an executed contract ready to exchange in the format submitted by your email of 16th September (5:24 pm). Please advise if you are in a position to exchange". 61 A few hours later, VL responded: "Thank you, I will provide my client's counterpart signed sale contract shortly". 62 Shortly thereafter, VL emailed ABL, attaching the applicant's counterpart signed contract and added: "We await your clients' [sic] counterpart". The attached executed counterpart was dated 4 September 2020. Under the heading "Deposit Payment Time", the following words were inserted: "Already paid (subject to cheque clearance)". The "Completion Date" was specified as 25 September 2020. 63 A few minutes later, ABL emailed VL: "My company search for your client indicated it is no longer a sole/director secretary company, but only one director has signed. Please advise". 64 VL immediately responded by email, attaching a current company extract for the applicant and confirming that Mr Christopher Billing was the only current director/secretary. ABL then asked VL to amend the execution clause to note that Mr Billing was signing as sole director as well as sole secretary, and that the contract be dated that day (18 September 2020), not 4 September. 65 A few minutes later, VL emailed an amended contract. 66 ABL responded: "I am going to be difficult and note that your client's execution clause really must say sole director and sole secretary. Rather than sole director only. Can you please correct? Please find attached my clients [sic] counterpart". 67 The counterpart to which ABL referred in that email, which was signed on behalf of the respondent vendor, was dated 18 September 2020. As to the "Deposit Payment Time", the document provided "Already paid (subject to cheque clearance)". Again, the contract had a sale price of $12 million and deposit of $1.2 million. 68 A few minutes later, VL emailed to ABL a signed counterpart which, consistently with ABL's request, was signed on behalf of the applicant purchaser by Mr Billings as sole secretary and sole director. This version of the contract was not signed on behalf of the respondent vendor. 69 A few minutes later, ABL emailed VL: "Thank you. I will contact you in relation to settlement arrangements next week". 70 On 23 September, ABL emailed VL attaching, among other things, a transfer (unsigned) under s 58 of the Land Titles Act 1980 (Tas) and a settlement statement of the same date which, among other things, stated that the amount required to settle the matter as at 25 September 2020 was $12,063,478.17, including a deduction for the deposit of $1.2 million. 71 The next day, ABL emailed VL attaching an amended lease document. The amendments had been made to "rental and outgoings", consistent with what ABL was instructed was "the agreed position". The email also provided that ABL would have a cheque for the rental at settlement. The email also enquired of VL whether they had engaged a local agent for settlement scheduled for the following day. 72 On 28 September, ABL wrote to VL, attaching a notice to complete in the following terms (emphasis in original): CAR PARKS SUPER PTY LTD (A.C.N. 607 566 094) AS TRUSTEE OF THE ALLEN FAMILY SUPERANNUATION TRUST of PO Box 32, Hagley in Tasmania (hereinafter called "the Vendor") HEREBY GIVE NOTICE as follows: 1. The Vendor is ready, willing and able to complete the sale to you of a property situate [sic] at 41-43 Paterson Street, Launceston in Tasmania contracted to be purchased by you by an Agreement dated 18th September 2020 (hereinafter called "the Agreement") and made between the Vendor of the one part and yourself of the other part in accordance with the terms of the Agreement and the offer made by you on 16th September 2020 for resolution of the dispute between the parties. 2. The Vendor has also caused for a commercial lease agreement to be executed in accordance with the terms of offer issued by you on the 16th September 2020, with the tenant agreed by correspondence (Donald Keith Allen and Janet Anne Allen) and at the agreed amended rental, and the tenant is ready, willing and able to proceed with the lease immediately following completion. 3[.] The Vendor requires you to complete the purchase, pay the purchase moneys and deliver up an executed lease on or before 3:00 p.m. on the 12th day of October 2020 and in this respect time is of the essence of the said contract. 4. The Vendor appoints 2:30 pm at the offices of Archer Bushby, 63 Charles Street, Launceston in Tasmania as the time and place for completion. 5. Unless you complete within the time specified in this Notice the Vendor will be entitled to terminate the said contract and seek such relief as it may be entitled at law or in equity. 73 The notice to complete was attached to a letter in these terms: We note that settlement of the above matter was due on 25 September 2020. Your client did not complete on the date named in the contract for completion. Please find attached notice to complete served on your client in respect to the above matter. 74 On 2 October, ABL emailed to VL a signed transfer, answers to requisitions on title, and a settlement statement, which among other things noted that the total amount required to settle as at 12 October 2020 was $12,059,382.81, again allowing for the deduction of the $1.2 million deposit paid. 75 A few minutes later, ABL again emailed VL: I refer to my email of 24 September 2020 attaching terms of lease. I note your advice that your client had no issues with those terms in our attendance of 25 September 2020. In light of the notice to complete issued by the property vendor to your client, I have amended the commencement date of the lease till the 13th October 2020 and attach. I hold an executed lease and a cheque for the rental payable pursuant to the terms ready for exchange. I note a GST tax invoice will be required. 76 On or about 9 October, Mr Allen and Mr Billings exchanged the following text messages. Mr Billings wrote, "Hi Don, how did you go with your lawyer this morning?" Mr Allen replied, "Chris[.] She is on leave[.] Will get her to talk to Richard [Prangell] Monday[.] I see no problem extending 14 days[.] Will confirm am Monday". 77 The parties did not dispute that it is to be inferred from that text message exchange that Mr Billings had asked Mr Allen, independently of their respective lawyers, for a 14 day extension of the time within which the notice to complete insisted settlement occur. 78 The same day, a little later in the afternoon, ABL wrote to VL: "We refer to our telephone attendance today and confirm we have forwarded your advice to Kate Alcorso of our office. Kate is aware of the informal discussion between our respective clients and endeavours to obtain formal instructions from our client on Monday. We intend to respond to you shortly thereafter". 79 On 12 October, ABL emailed VL: "I note that the time for settlement under the notice to complete issued 28th September 2020 is 2:30 pm today. I look forward to seeing your agent at that time". 80 It was also not disputed that it is to be inferred that shortly thereafter, Mr Prangell and Ms Alcorso spoke on the telephone, and as a result ABL emailed VL at 12:59pm that day: "There are no changes to my instructions". 81 At 1:25pm the same day (12 October 2020), VL emailed ABL: My client is deeply disappointed in your client's conduct. In good faith, my client presented your client with the option by telephone last week to proceed today as agreed, or to extend on the basis of a reduction of rent for the premises. Your client clearly indicated an intention to accept the reduction and extend settlement, noting only that legal formalities were pending. That your client has chosen to reverse his position at 12.30pm today, with only two hours of notice, is a show of disturbing bad faith and a transparent attempt to engineer a breach. 82 On 14 October, ABL wrote to VL: Pursuant to the Notice to Complete issued by our client on the 28th September 2020, your client had until 3:00 pm on 12th October 2020 to complete the purchase of the property. Your client failed to do so. Accordingly, our client terminates the contract between the parties dated the 18th September 2020. 83 VL responded at 10:14am on 16 October in a letter headed "Without prejudice except as to costs", as follows (emphasis in original): We refer to the above matter, to your letter of 14 October 2020, and to our email of 12 October 2020. 1. We take this opportunity to confirm the following: (a) On or about 8 October 2020, our client presented your client with the option by telephone to proceed with settlement on 12 October 2020 as anticipated, or to extend settlement on the basis of a reduction of rent for the premises; (b) Your client clearly indicated an intention to accept the reduction and extend settlement, noting only that legal formalities were pending; (c) Two hours before the original 12 October 2020 settlement date, your client attempted to re-affirm the initial settlement date and time, leaving insufficient time for our client to complete, in what was a transparent attempt to engineer a breach of contract. 2. Our client rejects the purported termination contained in your letter of 14 October 2020. 3. Nevertheless, we are instructed that our client is prepared to settle the dispute with your client on the following basis: (a) your client to execute a new Contract for the Sale of Real Estate (Contract) for the Paterson St Site (Site) for the previously agreed sum, on or before 23 October 2020; and (b) the deposit under the Contract to remain unchanged, as already received; (c) settlement under the Contract to occur on the earlier of: (i) the expiration of 6 calendar months; or (ii) the completion and approval of any Development Application for the Site; the earlier of which being the "Sunset Date"; or (iii) at our client's discretion, any time before the Sunset Date with 2 weeks notice, subject to a lease back of the premises until the Sunset Date. (d) In addition, your client will: (iv) Grant to our client a power of attorney to complete any required Development Applications for the site, support and approve any such applications and do any and all other things required to approve and progress our client's intended development of the Site; and (v) Not to make objections to any such development, disparage our client or any other stakeholders with respect to the development; and (vi) Agree to keep confidential any and all matters arising from the acquisition of the Site, any development on the Site or arising from this settlement offer. (e) any lease to operate the Site be on terms previous [sic] agreed, at a monthly rent of $20,000 payable in advance. 4. If your client does not accept this offer, our client required [sic] immediate return of the deposit sum in your firm's possession. 5. This offer is made by our clients on the basis that, while it is without prejudice, it will be referred to any ultimate decision maker on the question of costs, and our clients reserve their right to place this letter, together with any response or failure to respond, before the court. In relation to the nature of this offer, we refer you to Calderbank v Calderbank [1976] 4 All ER 333. 6. This offer is open for acceptance until close of business today, 16 October 2020. 7. Our client reserves its rights. We await your response. 84 At 11:14am the same day, ABL sent a without prejudice email to VL, which read: "I refer to your letter … I presume you received the automatic response that I am at a seminar today. I have, however, spoken to my client. I am instructed that my client has spoken to yours and he was aware this letter would be forthcoming. He indicated to your client that we would respond next week and your client had no difficulty with that". 85 At 5:22pm that day, VL responded: "This comes as a surprise to my client. I am instructed that my client requires a response before 12 noon on Monday". 86 On 21 October, VL wrote a letter to ABL, again headed "Without prejudice except as to costs": We refer to the above matter, and to our letter of 16 October 2020. 1. We note that we have received no response or acknowledgement of our letter. 2. We take this opportunity to confirm that the offer contained in that letter has now lapsed. 3. Our client is ready, willing and able to proceed on the basis agreed between the parties by telephone on 8 October 2020 and appoints 2.30pm, on 26 October 2020 at the offices of Sproal & Associates, 71 St John Street Launceston, Tasmania as the time and place for completion. 4. If your client does not appear for completion, we are instructed to commence urgent action for specific performance[.] 5. Our client reserves its rights. We await your response. 87 On 26 October, ABL emailed VL: On a without prejudice basis to the different views as to the discussions held on or about 9th October 2020 between the parties, I have been instructed to enquire whether your client has executed a lease of the property to Mr & Mrs Allen. What is your client claiming are the terms agreed in relation to the lease? 88 ABL and VL exchanged a number of emails in relation to the lease over the course of that day. 89 On 11 November, VL emailed ABL (emphasis in original): I understand that our clients are speaking this afternoon at 5pm. I am instructed by my client that if the parties are unable to resolve the matters between them today with respect to the acquisition of the Paterson St location, that my client is unable to continue to rely on the patience of Launceston City Council. As a result, the following is the final offer from my client: 1. Settlement to proceed on 4 December 2020, subject to a new sale contract to be executed tomorrow; 2. Lease extended to end of March 2021 at nominal cost to your client; 3. [O]ther terms to remain the same as previously agreed. Please be aware that my client is unable to enter into any further negotiation, and requires confirmation in writing from your office today if the above terms are agreed. If the above is not agreed today, our client requires the immediate return of the deposit sum. 90 The next day, 12 November, ABL wrote a letter to VL, headed "Without prejudice save as to costs", as follows: We refer to our prior correspondence in this matter. Your client has sought the immediate return of the deposit sum held in respect to the Contract dated 18 September 2020 ("the Contract")[.] Our client has terminated the Contract due to your client's failure to settle by 12 October 2020, the day at which the Notice to Complete issued by our client expired. Accordingly, pursuant to Standard Condition 18(b) of the Contract, the deposit is forfeit to the Vendor. We note that your client disputes our client's entitlement to terminate. Our client categorically denies the assertions made by your client that a variation of the time for settlement was agreed between the parties. However, as a show of good faith and to resolve the disputes between the parties, our client has confirmed that they would agree for the deposit to be released to the Purchaser on the basis that the Purchaser confirms that no action will be brought by the Purchaser for specific performance, damages or otherwise in relation to the enforcement of any agreement between the parties for the sale of the Property by the Vendor to the Purchaser. We look forward to your response. 91 VL responded the next day as follows: My client accepts your clients [sic] terms. Please arrange for the deposit to be returned by bank transfer to: Viridian Lawyers Pty Ltd Trust Account BSB: [###-###] Account: [#########] Alternatively, please arrange for a bank cheque to be delivered to the offices of Sproal & Associates. 92 At 4:44pm on 20 November, ABL emailed VL, attaching a letter headed "Without prejudice" as follows: We refer to our previous correspondence in respect to the above matter and note that our respective clients have continued to attempt to resolve the differences between them. We understand that our clients have negotiated some further terms, which may form a fresh contract between them for the sale by our client of the above property to your client, which would resolve those disputes. We are accordingly instructed to submit the following: 1. Proposed Contract for Sale of Real Estate, comprising Particulars of Sale and Standard Conditions of Sale; and 2. Lease, which is to be annexed to the Contract as Annexure A. Please advise if your clients will accept the terms proposed by close of business on Monday 24 November 2020. Please also confirm if your client has corresponded with and obtained the agreement of Council to execute the agreement. If your client and Council are amenable, then we would appreciate if you could also confirm when you will hold a contract executed by your client and by Council in readiness for exchange. 93 The proposed Contract for Sale of Real Estate referred to in that letter was unsigned, and relevantly provided that the deposit was $1.2 million. Under the heading "Deposit Holder" and the words "(Insert name of person or organisation that will hold the Deposit)" were the words "Archer Bushby". The contract also provided under the heading "Deposit Payment Time" as follows: "Within 3 business days of the date of the Contract". The document was undated, but specified a completion date of 4 December 2020. 94 On 23 November, VL emailed ABL: "As requested, we confirm our clients [sic] agreement. We expect to provide executed counterparts tomorrow". 95 At 2:16pm on 24 November, VL emailed ABL: "Please find attached our client's signed counterpart agreements". 96 The counterpart documents were in the same form as those emailed by ABL to VL on 20 November 2020, and signed by the applicant. 97 Less than ten minutes later, VL emailed ABL: "I am informed that council's solicitors hold their clients' [sic] executed counterpart Contract for the Sale of Real Estate. Could you please confirm your preferred process for exchange". 98 Later that day, the solicitors for the Council, SWL, emailed ABL (copied to VL), attaching the contract signed by the Council in its capacity as guarantor "by way of exchange". The email concluded: "I look forward to receiving the Vendor's signed counterpart". 99 On 26 November, VL emailed ABL (copied to SWL): "Could you please advise when my client can expect your client's signed counterpart". 100 On 2 December, VL emailed ABL: "We note that the proposed settlement date is fast approaching. Could you please advise urgently if my client can expect an executed agreement today". 101 ABL emailed VL later that day, saying that they would respond when they had instructions. 102 Two days later, ABL emailed VL: I refer to my email of 2 December 2020. I do not have instructions to exchange contracts for the Property at this point in time. However, my client has asked that I pass on that he remains engaged with the process being undertaken and we are in regular communication. 103 On 8 December, SWL wrote to ABL: I understand that the attached contract signed by my client in their capacity as Guarantor was provided to you on 24 November 2020 together with the counterpart signed by the Purchaser in anticipation of exchanging contracts with the Vendor. Over 2 weeks have elapsed since the signed contracts were provided to you. I understand that whilst you do not have instructions to exchange contracts your client 'remains engaged with the process'. My client has advised that they are extremely frustrated with the delays in finalising this matter. Accordingly, I am instructed as follows: 1. The Deposit that my client paid pursuant to the Contract that the parties exchanged in June 2020 and subsequently agreed to end must be returned to my client without delay. 2. Exchange of Contracts – exchange of contracts is to occur by 5pm, 10 December 2020. If exchange does not occur within this timeframe then my client's contract will be withdrawn and my client will cease to be Guarantor. 3. Settlement – assuming that the Contracts are exchanged within the timeframe required by my client, settlement is to occur on or before 4pm Friday, 18 December 2020. If this timeframe is not met, my client will cease to be the Guarantor. Whilst my client is exploring alternative options, I am instructed that my client currently remains committed to the development of a bus exchange on the Site. 104 On 10 December, SWL emailed ABL: "I refer to your recent letters and note that the issue of returning the deposit has not been addressed. I am instructed that the issues raised in your letters will not be addressed until the deposit has been returned to us. Attached are our trust account details". 105 On 16 December, SWL wrote to VL, referring to their 10 December email to ABL, as follows: "To enable the release of the deposit, please confirm to Kate Alcorso that they are authorised to return the deposit by depositing it into our trust account …" 106 The same day, VL emailed ABL, copied to SWL, referring to SWL's 10 December email, as follows: "Our client authorises the return of the deposit in accordance with the instructions provided by [SWL]". 107 VL emailed ABL two days later, copied to SWL, as follows: "Given that your client refuses to confer on settlement, that the deadline for settlement under the exchanged contracts has passed and that the guarantor has withdrawn its guarantee, please urgently specify the basis on which your client is withholding the return of the deposit. We await a response by close of business today". 108 On 1 February 2021, ABL wrote a letter to VL, headed "Without prejudice save as to costs": We refer to our letter of 12th November 2020 referencing the forfeit deposit and your response of the 13th November 2020. Subsequent to that correspondence we received correspondence from Simmons Wolfhagen on behalf of the Launceston City Council claiming the deposit was forfeit to their client and seeking that it be paid to them, referencing earlier correspondence to that set out above. While, you have subsequently confirmed your client authorised the return to Simmons Wolfhagen, the various claims in thee [sic] correspondence have left our client unclear as to whether your client's authorisation for payment to Simmons Wolfhagen encompasses and satisfies the arrangements proposed in the correspondence of 12th and 13th November. We look forward to your response. 109 VL responded by email to ABL two days later, copied to SWL, as follows: Our client considers that the arrangement proposed in your correspondence of 12 November 2020 has long since expired, and we note the failure by your client to once again comply with its own proposed terms. For the avoidance of any ambiguity, our client unequivocally withdraws any agreement to such an arrangement. Our client's instruction that payment be made to the Simmons Wolfhagen Trust Account remains, and our client demands that the return of the deposit be attended to by close of business today. If the deposit is not returned today, I have been advised that the Council's solicitor has instructions to commence legal action in the Supreme Court seeking an order for the return of the deposit to the Council. 110 On 5 February, ABL wrote a letter to VL, headed "Without prejudice save as to costs": We refer to your email of 3 February 2021 in relation to the above matter. The sum of $1,200,000.00, which constituted the deposit was forfeit to our client, in consequence of your client's breach of contract. Our client remains willing and able to return the sum to Simmons Wolfhagen (in accordance with your authorisation of 16 December 2020), on your confirmation of agreement to the terms in the correspondence dated 12 and 13 November 2020. We look forward to your confirmation. 111 On 9 February, VL emailed ABL, copied to SWL, as follows: We refer to your letter of 5 February 2021, my client has instructed me to accept the terms of the offer contained in that latter [sic]. You are authorised to return the $1.2 million deposit to the Simmons Wolfhagen Trust Account. The deposit is to be returned by 5pm tomorrow, being Wednesday, 10 February 2021. 112 The following day, VL again emailed ABL, copied to SWL, as follows: We have received no correspondence from you concerning the return of the deposit in accordance with our email of 9 February 2021. We note therefore that your client has once again failed to return the deposit, and our client's acceptance has now lapsed. Our client reserves its rights. 113 On 11 February, ABL forwarded to VL a draft unsigned deed of release "to reflect the terms from our correspondence in more formal detail". 114 On 3 March, ABL wrote to VL: I refer to the proceedings commenced by Creative Property Holdings Pty Ltd against my client, Car Parks Super Pty Ltd and the Launceston City Council in proceeding TAD3/2021 in the Federal Court of Australia. That proceeding will be vigorously defended by my client. The assertion that the parties entered into an enforceable contract for sale between 2 and 24 November 2020 is factually and legally wrong. Without limiting the various matters that my client will rely upon in defence of that proceeding and without acknowledging in any way the merit of the contention that the parties have entered into an enforceable contract, even if that contention were to be made good in the proceeding, then the simple fact is that the Purchaser failed to pay the deposit of $1.2M and the contention at paragraph 8 of the statement of claim that this firm "held the deposit" is plainly wrong for the reason that that money was held pursuant to an earlier contractual arrangement between the parties that was the subject of dispute. My client's primary defence to this proceeding is that the correspondence from this firm of 20 November 2020 did not amount to an offer that was capable of acceptance by the Purchaser and the Launceston City Council and, in any event, was expressly made subject to the exchange of contracts. No exchange of contracts by the Vendor occurred. The law is clear that, in that circumstance, there is no enforceable contract Eccles v. Bryant [1948] Ch 93 at 99. In the event that, contrary to my client's view, the parties did enter into an enforceable contract between 20 and 24 November 2020 (which is strenuously denied by my client), then I am instructed to give notice that the Vendor terminates that Contract for non-payment of the deposit by the Purchaser and or the Launceston City Council, as the case may be. 115 On the same day, ABL also sent via hand delivery to VL this letter: I refer to the exchange of correspondence between Archer Bushby of 12 November 2020 and Mr Richard Pragnell [sic] of 13 November 2020. Pursuant to the compromise agreement as evidenced by this correspondence, I deliver a bank cheque in the sum of $1,200,000.00 being a refund of the deposit paid to Archer Bushby as stakeholder, pursuant to the Contract dated 18 September 2020 between Car Parks Super Pty Ltd as the Vendor and Creative Property Holdings Pty Ltd as the Purchaser, for the sale of land at 41-43 Paterson Street, Launceston. 116 On 12 March, VL wrote to ABL: We refer to the above matter, and to your letter of 3 March 2021. 1. We enclose, and return, the bank cheque for $1,200,000 delivered to the office of our agent on 3 March 2021. 2. Our client rejects, and does not accept the refund of its deposit on the purchase of the land at 41-43 Paterson St, Launceston (Land). 3. We take this opportunity to remind your client that: (a) it repeatedly failed to comply with its obligations under its own offer for settlement of 12 November 2020; and (b) our client clearly and unequivocally withdrew its agreement to the settlement offer by email on 3 February 2021. 4. Our client continues to be is [sic] ready, willing and able to complete settlement on the land at the earliest opportunity. Consideration The claim for specific performance 117 As Lord Greene MR explained in Eccles v Bryant and Pollock [1948] 1 Ch 93 at 99-100: It is said that a contract took place when, in response to an alleged invitation on behalf of the vendors, the purchaser signed his part of the contract and communicated the fact to the vendors. It was argued that there is no necessity in this class of case for an exchange of documents at all, and that the references which have taken place in very many judgments in this court and other courts to an exchange are either inaccurate or wrong; a contract in this class of case, it is said, does not require exchange. The answer to that seems to me to be a simple one. When parties are proposing to enter into a contract, the manner in which the contract is to be created so as to bind them must be gathered from the intentions of the parties express or implied. In such a contract as this, there is a well-known, common and customary method of dealing; namely, by exchange, and anyone who contemplates that method of dealing cannot contemplate the coming into existence of a binding contract before the exchange takes place. It was argued that exchange is a mere matter of machinery, having in itself no particular importance and no particular significance. So far as significance is concerned, it appears to me that not only is it not right to say of exchange that it has no significance, but it is the crucial and vital fact which brings the contract into existence. As for importance, it is of the greatest importance, and that is why in past ages this procedure came to be recognized by everybody to be the proper procedure and was adopted. When you are dealing with contracts for the sale of land, it is of the greatest importance to the vendor that he should have a document signed by the purchaser, and to the purchaser that he should have a document signed by the vendor. It is of the greatest importance that there should be no dispute whether a contract had or had not been made and that there should be no dispute as to the terms of it. This particular procedure of exchange ensures that none of those difficulties will arise. Each party has got what is a document of title, because directly a contract in writing relating to land is entered into, it is a document of title. That can be illustrated, of course, by remembering the simple case where a purchaser makes a sub-sale. The contract is a vital document for the purpose of the sub-sale. If he had not got the vendor's part, signed by the vendor, to show to the sub-purchaser, he would not be able to make a good title. 118 The position is the same in Australia. As Mason, Murphy, Wilson, Brennan and Dawson JJ said in Sindel v Georgiou (1984) 154 CLR 661 at 665-666: The usual practice in New South Wales is for parties entering into a contract for the sale of land to exchange signed counterparts of a written contract so that, in consequence of the exchange, the purchaser has possession of a copy signed by the vendor and the vendor has possession of a copy signed by the purchaser: Allen v. Carbone (1975) 132 C.L.R. 528, at p. 533; Brien v. Dwyer (1978) 141 C.L.R. 378, at p. 391; Smith v. Lush (1952) 52 S.R. (N.S.W.) 207, at p. 212. When the parties propose to enter into a contract for the sale of land by the customary procedure of exchange they do not contemplate the coming into existence of a binding contract before the exchange takes place. The exchange "is the crucial and vital fact which brings the contract into existence": Eccles v. Bryant and Pollock [1948] 1 Ch. 93, at p. 99. The ceremony of exchange constitutes a mutual acknowledgement that the bargain has been struck. In earlier times that ceremony invariably took place at the office of one of the solicitors, exchange being effected by physical delivery. In more recent times exchange of contracts is effected by post (Eccles v. Bryant and Pollock) and, sometimes, constructively by telephone: Domb v. Isoz [1980] 1 Ch. 548. 119 In even more recent times, of course, exchange of contracts is routinely effected by email. 120 It follows that if parties do not intend to be bound until exchange, until that occurs it is open to any party to withdraw. 121 In my view, the correspondence in evidence, and in particular the correspondence upon which the applicant relies in its statement of claim, shows that the parties did not intend any departure from the customary procedure of exchange, and that they mutually contemplated that a contract would only come into existence upon the signing and exchange of counterparts. 122 In my view, the applicant's case that its offer was accepted and that a binding contract was formed between it and the respondent (which included the various terms as to deposit, purchase price, completion date, and so on) by the exchange of the pleaded correspondence, set out at [10]-[13] above, cannot be accepted. That very correspondence (and much of the correspondence that preceded the pleaded documents, if it matters) shows – to my mind beyond a doubt – that the parties did not contemplate the coming into existence of a binding contract before exchange. 123 ABL's 20 November 2020 offer (at [92] above) expressly sought confirmation as to when the purchaser's solicitor (and the Council) would be ready to exchange contracts, viz: If your client and Council are amenable, then we would appreciate if you could also confirm when you will hold a contract executed by your client and by Council in readiness for exchange. 124 Three days later, on 23 November, VL replied: "We expect to provide executed counterparts tomorrow" – which does rather indicate that the purchaser's solicitor likewise believed that exchange of counterparts was agreed to be necessary in order for a binding agreement to exist. 125 And the next day VL wrote to ABL: "I am informed that council's solicitors hold their clients' [sic] executed counterpart Contract for the Sale of Real Estate. Could you please confirm your preferred process for exchange". 126 The Council was of the same mind. For example, its solicitors wrote to ABL on 8 December 2020 (see [103] above) that "I understand that the attached contract signed by my client in their capacity as Guarantor was provided to you on 24 November 2020 together with the counterpart signed by the Purchaser in anticipation of exchanging contracts with the Vendor"; that the Council was "extremely frustrated with the delays in finalising this matter"; and that exchange of contracts should occur by 5pm on 10 December 2020. 127 It seems to me, therefore, that it is quite clear that all parties, including the Council, understood that the "well-known, common and customary method of dealing" – exchange of counterpart contracts – was necessary in order to bring into existence a binding contract for the sale of the Property. 128 As I said, if it matters, this was the case throughout the dealings that led to the correspondence relied on by the applicant in its statement of claim. By way of example, on 18 September 2020, ABL wrote to VL (at [60] above): "I hold an executed contract ready to exchange in the format submitted by your email of 16th September (5:24pm). Please advise if you are in a position to exchange". 129 The immediate reply the same day read: "I will provide my client's counterpart signed sale contract shortly". About two hours later, VL wrote to ABL again, "attach[ing] my client's counterpart signed contract" and noting that they awaited "your clients' [sic] counterpart". 130 Because there was no exchange of counterparts, the applicant's claim for specific performance and declaratory and injunctive relief must therefore be dismissed. The ACL claim 131 The applicant did not say much in support of its ACL claim, which was founded on the allegation that when the respondent made the 20 November 2020 offer, it did not intend to enter into a binding contract. As the respondent submitted, and quite apart from anything else, no evidence was led in support of it. 132 But, in any event, there was nothing misleading about the notion that the respondent could decide to withdraw at any time prior to exchange, for the reasons I have explained above. The ACL claim will therefore also be dismissed. The deposit 133 The respondent also submitted, in the alternative, that if the applicant and the respondent entered into a contract for the sale of the Property on or about 23 or 24 November 2020, the applicant failed to pay the deposit. Because I have found that no such contract was brought into existence, the issue does not arise. 134 The respondent's argument with respect to the deposit was that the cheque for $1.2 million, which had been agreed by the parties represented payment of the deposit for the two earlier proposed transactions that failed to complete, was not applied to the contract alleged in this proceeding. That submission turned on the wording of the deposit clause which inserted "Archer Bushby" (ABL) after the pro forma instruction in the standard form contract "(Insert name of person or organisation that will hold the deposit)". (The contract also provided that the deposit was payable within three business days of the date of the contract, which was undated. See [93] above.) 135 The respondent, however, did not proffer any reason or explanation as to why the deposit, if it had been intended only to be applied to the two earlier transactions, was not then returned. In his oral address, Mr McElwaine accepted that "if there is one matter of criticism of the vendor in all of this … it's that timely steps were not taken to comply with the settlement agreement, so far as return of the deposit is concerned", and "the vendor ought to have acted in a more timely way to return that deposit held pursuant to the September contract". The agreement to which Mr McElwaine referred is contained in the correspondence set out at [90] and [91] above. 136 In my view, the notion that, objectively construed, the relevant exchanges between the parties mean that they are to be taken to have agreed that although the cheque for $1.2 million, originally paid on 9 July 2020 (see [40]) was applied to the two earlier transactions, it was not to be applied to the contract alleged in this proceeding, is highly improbable. As Mr Gunson put it in his reply submission: In my submission, it defies any commercial logicality that, firstly, the offer put by Viridian Lawyers was that the terms of the new contract would otherwise be on the same terms as previously; which included the deposit being re-used or recycled to constitute a deposit. Then what happens without any express notice or drawing of attention to the distinction, Archer Bushby put in a standard requirement for the payment of the deposit. The first respondent has not repaid the deposit as required by its previous agreement in the course of conduct leading to an ongoing settlement of the matter. They still held a deposit in relation to what ultimately must have been perceived as a contract discharged by agreement. Archer Bushby is admitted to be the agent of the first respondent; at that point it was holding $1.2 million of the applicant's money that it had no entitlement to retain. That must be interpreted, in my submission, as a matter of commercial reality and common sense as constituting payment of the deposit. There were no attempts made by the applicant to recover payment of the deposit whilst it clearly thought that it had a contract on foot. There was no attempt made by the first respondent to repay the deposit during that period of time. Of some significance, Mr McElwaine concedes that there was a delay in paying the deposit and writes it off in submissions from the bar table as merely being, 'A bit of a delay, an administrative hold up,' in payment of the 1.2 million. It's not a $50 deposit. But yet it doesn't adduce any evidence to explain that. The first respondent could have given evidence to say, 'Look, I was slack at getting instructions to repay the deposit.' Ms Alcorso could have given evidence to explain why the deposit wasn't paid. Instead they've chosen not to do so and, rather, to try and adduce evidence of an unavoidable administrative delay through oral submissions of counsel during the course of a hearing. Your Honour ought reject that, given that they had the perfect opportunity to respond to that issue and have chosen not to, and accept that when looked at objectively all the parties saw the 1.2 million that Archer Bushby was holding, as agent for the first respondent, as representing the deposit. 137 I agree with those submissions. It follows that if I am wrong in my finding that no contract was brought into existence, and that, to the contrary, a contract was brought into existence, that contract would not fail for want of payment of the deposit. 138 Neither the applicant nor the Council pleaded a case that if there was no contract as alleged, that the respondent (or its solicitor) was obliged to refund the sum paid by way of deposit. It may be that such a pleading was unnecessary, because where, as I have found, there is no contract between the parties, the Council, who paid the deposit, would ordinarily be entitled to a refund of it, because it was "a deposit paid in anticipation of a final contract and nothing more". See Chillingworth v Esche [1924] 1 Ch 97 at 112 (Warrington LJ). 139 Because the point was not pleaded or argued, and because it is not altogether clear (to me) where and by whom monies representing the deposit are currently held, or even whether there is any disagreement about the question of refunding it in the event that the applicant's case that there was a contract brought into existence failed, if any party wishes to make a submission on the point, they may do so within seven days of the date of these reasons. Disposition 140 For those reasons, the applicant's claim will be dismissed, with costs. I certify that the preceding one hundred and forty (140) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice O'Callaghan. Associate: Dated: 26 November 2021