Edwin Davey Pty Ltd v Boulos Holdings Pty Ltd [2022] NSWCA 65

Court of Appeal Supreme Court New South Wales Medium Neutral Citation: Edwin Davey Pty Ltd v Boulos Holdings Pty Ltd [2022] NSWCA 65 Hearing dates: 15 February 2022 Date of orders: 26 April 2022 Decision date: 26 April 2022 Before: Macfarlan JA at [1] Gleeson JA at [2] Simpson AJA at [124] Decision: (1) Appeal allowed. (2) Set aside order 2 made by the primary judge on 16 June 2021 and order 3 made on 1 July 2021, and in lieu order that: (a) declare that the cross-claimant is entitled to judgment against the cross-defendant in the sum of $500,000 plus interest from 10 July 2013 to 16 June 2021 pursuant to s 100 of the Civil Procedure Act 2005 (NSW); (b) declare that there be a setoff of the plaintiff's and cross-claimant's respective entitlements against each other, to be calculated as at 16 June 2021; (c) the amount of the judgment in favour of the plaintiff in order 1 on 1 July 2021 be varied such that judgment be entered for the balance only owing by the defendant to the plaintiff as at 16 June 2021, taking into account the declaration in (a) above, such judgment to take effect on 16 June 2021; (d) the defendant to pay the plaintiff's costs of its claim; (e) the plaintiff to pay the defendant's costs of its cross-claim. (3) Respondent to pay the appellant's costs of the appeal. (4) Order that the sum of $45,000 paid into court by the appellant as security for costs pursuant to orders made on 9 August 2021, together with any interest thereon, be paid out of court to the appellant. (5) Order that the sum of $45,787.80 paid into court by the appellant on 21 September 2021, together with any interest thereon, be paid out of court to the respondent. (6) Direct the parties to submit agreed orders to reflect the outcome of the appeal with respect to the judgment for the balance only owing by the defendant to the plaintiff within 7 days. Catchwords: CONTRACT – breach of contract – land sale contract – nature of breach – failure to complete by fixed date – where time not of the essence – whether failure to complete on time a continuing breach – substantive and temporal nature of obligation to complete CONTRACT – remedies – damages – causation – where delay in completion – claim for consequential loss – expenditure incurred in mitigating action – interplay between causation and mitigation – whether causative link between breach and action to mitigate loss – where purchaser agreed to pay mortgagee up to $500,000 if shortfall on recovery of mortgagee's loan from second security CONTRACT – remedies – damages – mitigation of loss – vendor unable to obtain discharge of mortgage – expenditure incurred by purchaser to obtain discharge of mortgage – whether reasonable action to mitigate loss – where available alternatives would have exposed purchaser to potentially greater loss CONTRACT – remedies – damages – remoteness – whether in contemplation of parties that purchaser would need to pay off part of mortgagee's loan to obtain discharge of mortgage – where vendor had not obtained mortgagee's consent to contract for sale or the release of deposit or prepayment to the vendor – where vendor failed to complete on fixed date Legislation Cited: Civil Procedure Act 2005 (NSW), ss 90, 100 Personal Property Securities Act 2009 (Cth) Uniform Civil Procedure Rules 2005 (NSW), r 42.1 Cases Cited: Alexander v Cambridge Credit Corporation (1987) 9 NSWLR 310 Arsalan v Rixon [2021] HCA 40; (2021) 395 ALR 390 Bak v Glenleigh Homes Pty Ltd [2006] NSWCA 10 Baltic Shipping Co v Dillon (1993) 176 CLR 344 Banco de Portugal v Waterlow & Sons Ltd [1932] AC 452 Berry v British Transport Commission [1962] 1 QB 306 Boensch v Pascoe (2019) 268 CLR 593; [2019] HCA 49 Burns v MAN Automotive (Aust) Pty Ltd (1986) 161 CLR 653; [1986] HCA 81 Cane v Lord Allen (1814) 2 Dow 289; 3 ER 869 Carr v J A Berriman Pty Ltd (1953) 89 CLR 327; [1953] HCA 31 Castle Constructions Pty Ltd v Fekala Pty Ltd [2006] NSWCA 133 Cazalet v Morris [1916] SC 952 C Czarnikow Ltd v Koufos (The Heron II) [1969] 1 AC 350 Chand v Commonwealth Bank of Australia [2015] NSWCA 181 Cubillo v Commonwealth (No 2) (2000) 103 FCR 1; [2000] FCA 1084 European Bank Ltd v Evans (2010) 240 CLR 342; [2010] HCA 6 Falcke v Scottish Imperial Insurance Company (1886) 34 Ch D 234 Foran v Wight (1989) 168 CLR 385; [1989] HCA 51 Galafasi v Kelly (2014) 87 NSWLR 119; [2014] NSWCA 190 Grant v Dawkins [1973] 3 All ER 897; 1 WLR 1406 Gray v Sirtex Medical Ltd (2011) 193 FCR 1; [2011] FCAFC 40 Hadley v Baxendale (1854) 9 Exch 341; 156 ER 145 Koch [Marine Inc v D'Amica Societa di Navigazione ARL (the "Elena d'Amico") [1980] 1 Lloyds Rep 75 Koomphatoo Local Aboriginal Land Council v Sanpine Pty Ltd (2007) 233 CLR 115; [2007] HCA 61 Kuru v State of New South Wales (2008) 236 CLR 1; [2008] HCA 26 Larking v Great Western (Nepean) Gravel Ltd (1940) 64 CLR 221 Louinder v Leis (1982) 149 CLR 509; [1982] HCA 28 Lumbers v W Cook Builders Pty Ltd (in liq) (2008) 232 CLR 635; [2008] HCA 27 March v E & MH Stramare Pty Ltd (1991) 171 CLR 506; [1991] HCA 12 McDonald v Dennys Lascelles Ltd (1933) 48 CLR 457 Owen v Tate [1976] QB 402 Radford v De Froberville [1978] 1 All ER 33 Ranieri v Miles [1981] AC 1050 Royal Bristol Permanent Building Society v Bomash (1887) 35 Ch D 390 Talacko v Talacko [2021] HCA 15; (2021) 389 ALR 178 Tasman Capital Pty Ltd v Sinclair (2008) 75 NSWLR 1; [2008] NSWCA 248 The Commonwealth v Amann Aviation Pty Ltd (1991) 174 CLR 64; [1991] HCA 54 Texts Cited: E Sugden, The Law of Vendors and Purchasers of Estates (14th ed, Hodges, Smith & Co, 1862) McGregor on Damages (21st ed, Thomson Reuters, 2021) Category: Principal judgment Parties: Edwin Davey Pty Ltd (Appellant) Boulos Holdings Pty Ltd (Respondent) Representation: Counsel: N J Beaumont SC / A J Macauley (Appellant) S B Docker / E M Keynes (Respondent)