CUSTOM CREDIT CORPORATION LTD v CENEPRO PTY LTD [1991] NSWCA 68

CUSTOM CREDIT CORPORATION LTD v CENEPRO PTY LTD SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

KIRBY P; MAHONEY and CLARKE JJA 3 and 4 April 1991, 7 August 1991

[1991] NSWCA 68

CONTRACT — financier promises "full funding to property developer — whether binding contract — held: In the circumstances, there was. The Coal Cliff Collieries Pty Ltd v Sijehama Pty Ltd, CA, unrptd, 5 July 1991 discussed — DAMAGES — loss of profit — loss of chance — project of property development collapses for want of funding by promised finance — proper approach to calculation of damages considered.

CONTRACT — binding contract — partners propose property development — suburban shops and residences — funding of $6.5 million required — financier A offers "full funding" subject to "total satisfaction" of it and its solicitors of "documentation" — financier B offers to "match" that offer accepts commitment in terms of financier A's letter — inserts penalty provision — promises later letter confirming "full funding" — developers accept offer of financier B and decline financier A — proceed to various stages of development promised letter committing "full funding" never supplied despite later undertakings to do so — financier B later discloses "change of policy" — development collapses developers sues financier B for breach of contract and for deceptive or misleading conduct under s52 Trade Practices Act 1974 (Cth) — financier B sues developers for recovery of advances and debt — developers plead estoppel asserting entitlement to relief on the ground of financier B's unconscientious conduct — trial judge (Cole J) finds (a) breach of contract; (b) breach of s52 Trade Practices Act; and (c) entitlement to rely on estoppel — awards damages for (i) futile borrowings less value of land plus (ii) loss of profits which would reasonably have accrued to the developers had "full funding" been provided as promised appeal —