McGettigan v Eliran Pty Limited [1999] NSWSC 769

New South Wales Supreme Court CITATION : McGettigan v Eliran Pty Limited [1999] NSWSC 769 CURRENT JURISDICTION : Equity Division FILE NUMBER(S) : 2517/99 HEARING DATE(S) : 22/07/99 JUDGMENT DATE : 22 July 1999

Brian Oliver McGettigan (P1) PARTIES : Lynette Anne McGettigan (P2) Gary James Morrison (P3) Eliran Pty Limited (D) JUDGMENT OF : Young J

COUNSEL : I M Wales SC and M Hadley (P) J A Needham (D) SOLICITORS : Harrington Maguire & O'Brien (P) Tonkin Drysdale Partners (D) CATCHWORDS : Conveyancing [59]- Time- Whether of essence- Commercial contract concerning investing in hotel. Words & Phrases- "Find an investor" Gerlach v Pearson [1950] VLR 321 CASES CITED : Lindsay v Mahoney (1979) 1 BPR 9584 Re R [1966] 3 All ER 613 Turnbull v Wightman (1945) 45 SR (NSW) 369 DECISION : Declarations made

THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

YOUNG, J

THURSDAY 22 JULY 1999

2517/99 - McGETTIGAN & ORS V ELIRAN PTY LIMITED

JUDGMENT

1 HIS HONOUR: The Kincumber Hotel Unit Trust is a trust of which the defendant is the trustee and, broadly speaking, there are three sets of beneficiaries, the McGettigan interests, who hold about 35 percent, the McGuinness interests who hold about 60 percent and a third person who holds 5 percent. The beneficiaries have been in dispute and earlier this year, in accordance with the trust deed, the McGettigan interests asked that their interest be redeemed. 2 In order to fund the redemption, the trustee put up for sale the only significant asset of the trust, namely the hotel, but the reserve was not met. 3 The McGettigans then sought to have a receiver appointed and to force the sale of the property. Those steps resulted in a settlement being reached on 16 June 1999, which involved a referee working out various accounting issues based on the common assumption that the hotel was worth $6.5 million gross, and the referee would come to a calculation as to the value of the McGettigans' interest. Although the referee was to be appointed within two days of 16 June, no time was laid down for his or her determination. 4 Clauses 4 to 7 of the terms of settlement were then as follows: "4. The Defendant shall have until 30 June 1999 to find an investor willing and able to invest sufficient funds to enable the Defendant to pay out the Plaintiffs in accordance with clause 7 of the Kincumber Hotel Unit Trust Deed. On such funds being paid to the Defendant, the Plaintiffs shall forthwith be paid the following sums on account of their entitlements as unit holders, with any further payment or refund to be made forthwith upon the Court's adoption of the Referee's report: