Morrow v Tucker [2006] NSWSC 750

New South Wales Supreme Court

CITATION : Morrow v Tucker [2006] NSWSC 750

HEARING DATE(S) : 25 July 2006

JUDGMENT DATE : 26 July 2006

JURISDICTION : Equity Division

JUDGMENT OF : Palmer J

DECISION : Order for specific performance made.

CATCHWORDS : CONTRACT FOR SALE – FINANCE CLAUSE – CONSTRUCTION – Whether a "subject to finance" clause imposed obligation on purchaser to complete contract with finance from a specified source and not otherwise.

PARTIES : Carmen Lee Morrow – Plaintiff May Tucker – Defendant

FILE NUMBER(S) : SC 1991/06

COUNSEL : S.A. Benson – Plaintiff J.M. Miller – Defendant

SOLICITORS : Baker Love – Plaintiff Swaab Attorneys – Defendant

Introduction and Issues

1 By a Contract of Sale dated 6 December 2005 the Defendant ("the Vendor") agreed to sell to the Plaintiff ("the Purchaser") a residential property in Salt Ash, near Newcastle. The contract required completion on 17 January 2006 but time was not made of the essence. 2 On 18 January 2006, the Vendor served a Notice to Complete requiring completion of the contract by 31 January 2006. The Purchaser did not complete the contract on that date and disputed the validity of the Notice to Complete. On 2 February 2006, the Vendor served a Notice of Termination of the contract. On 22 March 2006, the Purchaser commenced proceedings for specific performance of the contract. 3 In her Defence, the Vendor did not assert that the contract had been validly terminated for the Purchaser's failure to comply with the Notice to Complete. Rather, she asserted that the Purchaser had failed to perform an essential obligation imposed upon her by a "Finance Clause" contained in the contract so that the contract was validly terminated on 2 February 2006 for breach of a fundamental term. Alternatively, the Vendor says, the contract was subject to a condition imposed upon the Purchaser under the Finance Clause; that condition was not fulfilled, so that the contract never came into effect. 4 The parties filed a number of affidavits traversing many factual issues. However, when the trial commenced, it soon became apparent that there were only two fundamental issues: