Moses v Ratner [2022] NSWSC 1234

Supreme Court New South Wales

Medium Neutral Citation: Moses v Ratner [2022] NSWSC 1234 Hearing dates: 7, 8 December 2021; 21 February; 22 March 2022 Date of orders: 20 September 2022 Decision date: 20 September 2022 Jurisdiction: Common Law Before: Harrison J Decision: See [61] and [62] Catchwords: CONTRACTS – terms – joint venture to acquire and develop property – where joint venture agreement never reduced to writing – where parties dispute the agreed cost of construction of dwellings on the property Cases Cited: Chant v Curcuruto; Chant v Curcuruto [2021] NSWSC 751 Effem Foods Pty Ltd v Lake Cumbeline Pty Ltd (1999) 161 ALR 599; [1999] HCA 15 Kuhl v Zurich Financial Services Australia Ltd (2011) 243 CLR 361; [2011] HCA 11 LKT v Chun [2004] NSWSC 820 Watson v Foxman (1995) 49 NSWLR 315 Category: Principal judgment Parties: Michael Isaac Moses (Plaintiff) Gabriella Ratner (First Defendant) John Ratner (Second Defendant) Representation: Counsel: A Gruzman (Plaintiff) P Webb QC (Defendants)

Solicitors: Boskovitz & Associates (Plaintiff) A R Conolly & Company (Defendants) File Number(s): 2019/00354282 Publication restriction: Nil

Judgment 1. HIS HONOUR: Sometime around the middle of 2016, Michael Moses on the one hand, and Gabriella Ratner and John Ratner on the other hand, agreed to enter into a joint venture to purchase land at 8 Blake Street, Rose Bay and on it to construct a dual occupancy dwelling consisting of double storey houses with garages and swimming pools. The property was purchased as tenants-in-common for $3,240,000. The transaction was completed on 28 July 2016. 2. At the risk of oversimplification, the object and purpose of the joint venture was to have been the acquisition and development of the property for profit, with finance being provided as a combination of funds supplied by Mr Moses, funds supplied by Mr Ratner, including building costs, and a loan facility with the National Australia Bank. It was agreed that, on completion of the development, an adjustment would be made so that each party's contribution to the final project, including borrowing and other costs, would be the same. However, that relatively uncomplicated aspiration was never achieved. 3. In about December 2018, and following completion of the construction that same month, the properties were subdivided into two strata lots and partitioned. Mr Moses became the sole owner of 8A Blake Street, Rose Bay. Mr Ratner became the sole owner of 8B Blake Street, Rose Bay. Subject only to an agreed adjustment of $200,000 in favour of Mr Ratner to reflect the higher value of 8A, Mr Moses says that Mr Ratner remains indebted to him for a sum representing the amount by which Mr Moses' contribution exceeds his one half share of the acquisition and development costs. Mr Ratner maintains that nothing is owing by him and in fact maintains that Mr Moses owes him money. 4. The major dispute between the parties centres around the price for which Mr Ratner, as the builder, agreed to construct the houses. Despite the somewhat excruciating nature of the several versions of the statement of claim, it is clear enough that Mr Moses contends it was a term of the joint venture that Mr Ratner would build the houses for $1,600,000, or possibly $1,650,000 (inclusive of GST), later varied to $1,850,000. Mr Ratner disputes this and instead maintains that the agreement was that he would build the houses at a rate calculated at somewhere between $5,000 and $6,000 per square metre of internal floor space. On his case, the actual cost of construction would be a joint venture expense, not limited or restricted to a fixed price as Mr Moses claims. 5. Adjudication of this contest is regrettably complicated by the fact that the joint venture agreement was never reduced to writing.