Chan v Dainford Ltd [1985] HCA 15

High Court of Australia Gibbs C.J. Mason, Wilson, Brennan and Dawson JJ. Chan v Dainford Ltd [1985] HCA 15

ORDER Appeals allowed with costs. Set aside the orders of the Full Court of the Supreme Court of Queensland and in lieu thereof order that the appeals to that Court be dismissed with costs.

Cur. adv. vult.

The Court delivered the following written judgment:—

1985, March 12 Gibbs C.J., Mason, Wilson, Brennan and Dawson JJ.

In the Supreme Court of Queensland, Dainford Ltd. as vendor brought actions against Mr. and Mrs. Chan respectively as purchasers, seeking specific performance of contracts for the purchase of home units in a building to be known as "Peninsula" on the Gold Coast. The contracts were made on 19 August 1981 before "Peninsula" was built and therefore before a building units plan was registered under the Building Units and Group Titles Act 1980 Q. ("the Building Units Act"). Sheahan J. gave judgment for the purchasers. The Full Court set aside those judgments and in lieu thereof decreed specific performance. Special leave to appeal to this Court was granted, limited to certain grounds. The issue for determination on these appeals, as we would state it, is this: were the respective purchasers entitled to avoid their contracts pursuant to s. 73 of the Property Law Act 1974-1978 Q.? The relevant provisions of that section read as follows:

(1) A vendor under an instalment contract shall not without the consent of the purchaser sell or mortgage the land the subject of the contract.

(2) Where land is mortgaged in contravention of this section —

(a) the instalment contract shall be voidable by the purchaser at any time before completion of the contract;

(b) the vendor shall be guilty of an offence against this Act and liable to a penalty not exceeding five hundred dollars.