Supreme Court New South Wales Medium Neutral Citation: Gallinar Holdings Pty Ltd v Riedel [2014] NSWSC 476 Hearing dates: 11 April 2014 Decision date: 11 April 2014 Jurisdiction: Equity Division - Corporations List Before: White J Decision: Refer to paras [49], [51] and [52] of judgment. Catchwords: EQUITY - specific performance - construction of contract - whether sale price of property was inclusive of GST - whether a binding contract existed -whether the contract can be vitiated for unilateral mistake as to the purchase price of the property - whether the plaintiff ought to be denied specific performance on discretionary grounds - whether the defendant is entitled to rescind the contract - defendant bound by contractual terms - specific performance ordered Legislation Cited: A New Tax System (Goods and Services Tax) Act 1999 (Cth) Cases Cited: Tam v Mannall [2010] NSWSC 250 Ashton v Monteleone [2010] NSWSC 258 Air Great Lakes Pty Ltd v KS Easter (Holdings) Pty Ltd (1985) 2 NSWLR 309 Master v Cameron (1954) 91 CLR 353 Ermogenous v Greek Orthodox Community of SA Inc [2002] HCA 8; (2002) 209 CLR 95 Toll (FGCT) Pty Ltd v Alphapharm Limited [2004] 219 HCA 52; (2004) 219 CLR 165 Sindel v Georgiou (1984) 154 CLR 661 Taylor v Johnson [1983] HCA 5; (1983) 151 CLR 422 Misiaris v Saydels Pty Limited (1989) NSWConvR 55-474 Slee v Warke (1949) 86 CLR 271 Tamplin v James (1880) 15 Ch D 215 Borg v Howlett [1996] NSWSC 153 Boulas v Angelopoulos (1991) 5 BPR 11,477; (1991) NSWConvR 55,606 Category: Principal judgment Parties: Gallinar Holdings Pty Ltd (Plaintiff) Sandra Frances Riedel (Defendant) Representation: Counsel: S Chapple (Plaintiff) R Wilson SC (Defendant) Solicitors: Hansons Lawyers (Plaintiff) Thomas & Bisley (Defendant) File Number(s): 2013/301859 Judgment 1HIS HONOUR: This is a claim for specific performance of a contract for the sale of land. The plaintiff is the purchaser under the contract. The defendant is the vendor. The land in question comprises commercial premises subject to a lease. 2A dispute arose because the parties disagreed on whether the purchase price is inclusive of GST or whether GST is payable on top of the purchase price specified in the contract. The vendor believed that GST was payable on top of the purchase price. Mr Wilson SC, who appears for the vendor, accepts that that view was wrong. The vendor submits first that notwithstanding counterpart contracts being exchanged in identical terms, there was no binding agreement because there was no consensus on the price to be paid. Secondly, that if there were a binding contract, it is liable to be rescinded by reason of the vendor's mistake and, it is said, the purchaser's having exchanged, knowing of that mistake. Thirdly, the vendor submits that in any event, specific performance should be refused on discretionary grounds having regard to the vendor's mistake. I have concluded that none of these defences to the claim for specific performance succeeds. These are my reasons. 3On 11 January 2013 the vendor's solicitor, Mr Bisley of Thomas & Bisley, sent a draft Contract for Sale to Hansons, the purchaser's solicitors. After a considerable delay, Hansons sent a letter to Thomas & Bisley dated 13 May 2013 in which they stated: "We enclose by way of exchange:- 1. Contract executed by the purchaser. 2. Cheque in favour of your firm in the sum of $70,000 being the deposit payable. We would be pleased if you could date both the original and counterpart Contracts and return the executed original Contract in identical form to our office by return mail." 4The contract, as drafted by the vendor's solicitor and as executed by the purchaser and forwarded under cover of Hansons' letter of 13 May 2013, provided for a purchase price of $700,000 with a ten per cent deposit. For relevant purposes, the contract was in the standard form of contract provided by the Law Society of New South Wales and the Real Estate Institute of New South Wales. On the front page under the heading, "Tax Information (The parties promise this is correct as far as each party is aware)", there were a number of boxes to be filled in in relation to tax matters, including boxes against the subheadings, "Land tax is adjustable" and "GST: Taxable supply" and "Margin scheme will be used in making the taxable supply". The contract as drafted and signed for the purchaser, had the box "yes" crossed against the subheading, "Land tax is adjustable". It had the box "yes in full" crossed against the subheading "GST: Taxable supply". Under these boxes there were a further five boxes that could be crossed if the sale were not a taxable supply for any of the five reasons stated. None of those boxes was filled in. One of the boxes in question that could be filled in provides, "GST-free because the sale is the supply of a going concern under section 38-325". It was left blank. There was also, on this part of the contract, a box which states "GST Amount (optional)", and underneath that. "The price includes", underneath that, "GST of: $ ". This box was not completed. 5Clause 13.1 of the standard terms provides that various expressions, including "Taxable supply" and "Supply of going concern" have the same meanings as in the GST Act, that is, A New Tax System (Goods and Services Tax) Act 1999 (Cth). Clause 13.2 provides: "Normally, if a party must pay the price or any other amounts to the other party under this contract, GST is not to be added to the price or amount." 6The word "normally" is defined to mean "subject to any other provision of this contract". In other words, unless there is another provision specifying otherwise, GST is not to be added to the stated purchase price. Consistently with this, clause 13.8 provides that if the contract says that the sale is a taxable supply in full and does not say the margin scheme applies to the property, the vendor must pay the purchaser, on completion, an amount of one eleventh of the price if the sale is not a taxable supply in full, or if the margin scheme does apply to the property. In other words, if the sale is not a taxable supply but the contract states that it is, the vendor must refund the GST that is included in the purchase price. GST is not payable on top of the purchase price unless there is some other provision to so provide. There was no such other provision in the contract prepared by the vendor's solicitor. 7On 21 May 2013 Thomas & Bisley responded to Hansons' letter of 13 May 2013. They said: "We refer to your letter of the 13th May forwarding the copy of the contract executed by your Client Company providing for the sale being a taxable supply in full with the margin scheme not to be used and advise in view of the fact that the Purchaser and Tenant are two (2) different Companies our client would be prepared if your Client Company wished to do so to amend the GST choice to the sale not being a taxable supply because the sale is the supply of a going concern under Section 38-325 - that of course depends upon your Client Company being registered for GST purposes and evidence of its registration being provided to us." 8Section 9.5 of the GST Act provides that a supply is not a taxable supply to the extent that it is GST-free or input taxed. The supply of a going concern is GST-free under s 38-325 if it is for consideration, the recipient is registered or required to be registered, and the supply and the recipient have agreed in writing that the supply is of a going concern. Hence the available choice. 9Hansons replied to the purchaser on 23 May 2013. They said: "We have been instructed to advise that at all times our client understood that the sale was to be for a price of $700,000 inclusive of GST and that understanding was reflected in the Contract submitted by your firm and returned to your firm duly executed for exchange. Accordingly our client understood that the GST exclusive price was $636,363.63 which when GST is added would amount to $700,000.00. Our client is prepared to proceed to exchange on the basis that the sale is a going concern but to do so the price would need to be reduced to $636,363.63 so that it accords with the price as our client understood it and as reflected in the Contract initially tendered. If, however, your client wishes to have the price remain at $700,000.00, then our client requires the sale to be on the basis of a full taxable supply and if this is the way the matter will proceed, our client requests a prompt exchange of the Contract already submitted." 10Thomas & Bisley replied on the same day. They said: "We refer to your letter of the 23rd May and enclose a photostat copy of the front page of the contract executed by your client Company clearly indicating that the property was a GST taxable supply in full and that the margin scheme would not be used in making the taxable supple i.e. the sale price of the property was $700,000.00 plus GST for which our client would provide a GST tax invoice. Would you please advise whether or not your client Company wishes to proceed on that basis or on the basis set out in our letter of the 21st May or any other basis whatsoever. It was quite clear from the contract provided to you that the sale price did NOT include GST of $63,636.37." 11Mr Bisley was wrong in saying that it was clear that because the contract indicated that the property was a GST taxable supply, the sale price would be $700,000 plus GST. This was pointed out by Hansons on 28 May 2013. They said: "We refer to your letter dated 23 May, 2013 which we have provided to our client. We have been instructed to submit the following: 1. The Contract submitted by your firm provides for a sale price of $700,000.00 and indicates that it is a full taxable supply. There is no clause in that Contract requiring the Purchaser to pay anything more than $700,000.00 in respect of the sale price and clause 13.10 indicates that on completion the Vendor must give the Purchaser as [sic] tax invoice for the taxable supply. Accordingly the Contract as submitted, was for a sale price of $700,000.00 inclusive of GST. 2. The Purchaser regards the Contract as reflective of his understanding of the agreement with the Vendor. 3. The Purchaser requests the Vendor to proceed to exchange Contracts in this sale noting that the purchase Contract was submitted to your firm under cover of our letter dated 13 May, 2013 together with a deposit cheque for $70,000.00. We now await to hear from you." 12Thomas & Bisley responded later that day by saying: "We refer to your letter of the 28th May and enclose for your information a copy of the front page of the contract executed by your client Company which clearly provides that the sale to your client Company is a taxable supply and the margin scheme is NOT to be used in making the taxable supply. That means with respect that the price in the contract is $700,000.00 plus GST of $70,000.00 for which our client will provide a GST tax invoice under clause 13.10 of the contract. Please advise whether or not your client Company wishes to proceed with the purchase of the property from our client and if so on what basis and if your client Company does not wish to proceed on a basis which is acceptable to our client then the contract executed by your client Company and cheque for the deposit forwarded with your letter of the 13th May will be returned to you." 13Mr Wilson SC, who appears for the vendor, submitted that it is clear from this letter that the basis for exchange that was acceptable to the vendor was that the price of $700,000 did not include GST and if the purchaser did not accept that that was the position, it should have so advised. In that event, the signed contract and the cheque for the deposit would have been returned. In fact the letter from Thomas & Bisley of 28 May 2013 expressly asked the purchaser's solicitor to advise if the purchaser wished to proceed with the purchase of the property and if so, on what basis. The basis upon which the purchaser wished to proceed was stated in a letter from Hansons of 31 May 2013. They said: "Our client has instructed to advise that it wishes to exchange the Contract submitted under cover of our letter dated 13 May, 2013 and with no amendments to it. Would you kindly proceed to exchange that Contract or alternatively, indicate precisely what amendments are required by the Vendor for Contracts to be exchanged." 14This was a clear statement that the purchaser did wish to proceed on the basis of the contract as it had been prepared and without amendment. Hansons had already said that in their view, the contract as prepared, provided for a price which was inclusive of GST. The letter expressly invited the vendor to indicate any amendment it proposed if it sought to amend the draft contract. Mr Bisley deposed that he understood Hansons' letter to be an acceptance of the position he had stated on 28 May 2013. Whilst I accept that was his understanding, I do not see why he reached that understanding. The purchaser had made its position clear in prior correspondence and had not moved from that position. Rather, it asked the vendor to indicate any amendment that the vendor proposed. Any reasonable reading of the contract would have shown that an amendment was necessary if GST was to be payable in addition to the stated purchase price. 15On 3 June 2013 Thomas & Bisley responded to Hansons' letter of 31 May 2013. They wrote: "We refer to your letter of the 31st May and advise the property is offered by Mrs Riedel to Gallinar Holdings Pty Limited on the terms and conditions of the contract Gallinar Holdings Pty Limited executed or on the basis of the sale being the supply of a going concern under section 38-325 of the GST Act on the terms and conditions set out in our letter of the 21st May to you. We are returning the contract so that you can arrange for the Director of your Client Company to initial whatever GST choice it chooses and advise we are instructed if contracts are not exchanged with a section 66W certificate excluding the cooling off period on or before 5:00pm Tuesday 11th June the offer by Mrs Riedel for the sale of the property to your Client Company is withdrawn and she will list the property on the open market for sale. We note it is now nearly five (5) months since the contract was originally forwarded to you." 16This was an express statement that the vendor would sell on the terms as drafted or on the basis of a sale as a going concern, as set out in Thomas & Bisley's letter of 21 May 2013. That letter had not addressed what price would be payable if the property were sold as a going concern, but Hansons had said that if the property were sold as a going concern, the price should be reduced to $636,363.63. In their letter of 3 June 2013, Thomas Bisley said nothing about that matter. 17In response to the statement that the property was offered for sale on the terms and conditions of the contract as had already been signed by the purchaser, Hansons sent a letter to Thomas & Bisley dated 5 June 2013 enclosing: "1. Contract duly executed and with the Purchaser's sole director having initialled the GST choice that he [sic] sale is a taxable supply in full. ... 3. Cheque in favour of your firm in the sum of $70,000.00 being the 10% deposit." 18They asked Thomas & Bisley to proceed to exchange contracts on the basis of the contract enclosed with their letter. The only amendment to the document sent under cover of Hansons' letter of 23 May 2013 was that the purchaser's director, Mr Gallinar, initialled the two boxes that had been crossed for "yes" and "yes in full" against "Land tax is adjustable" and the sale being a "Taxable Supply In Full". The box that could have provided for the GST amount included in the price of $636,363.63 was left blank, but the front page of the contract provides for the completion of that box to be optional. 19Exchange was completed on 6 June 2013 by Thomas & Bisley for the vendor. They sent a letter of that date to Hansons advising: "We refer to your letter of 5th June forwarding the copy of the contract duly executed by your Client Company and advise contracts have been exchanged today with the original contract signed by our client being enclosed with this letter." 20The terms of the counterparts of the contract are identical. 21After exchange, the parties put in train the usual steps for completion of a Contract for Sale of Land. On 3 July 2013 Thomas & Bisley responded to requisitions and provided a tax invoice which they said would be handed to the purchaser on settlement and the form of transfer. The invoice was for $770,000, being the sale price of $700,000 plus GST of $70,000. Hansons asked for that invoice to be amended and in due course the dispute crystallised. Prior to 19 August 2013 there was no suggestion that the parties did not consider themselves to be contractually bound. On that day, Thomas & Bisley wrote to Hansons referring to two cases of which Thomas & Bisley had been advised by the Law Society; namely Tam v Mannall [2010] NSWSC 250 and Ashton v Monteleone [2010] NSWSC 258. Those cases both held that in circumstances where the standard form contract was used, as is the case with this contract, GST was included in the purchase price. They then dealt with questions of rectification. 22In their letter of 19 August 2013, Thomas & Bisley asserted that there was no agreement on the sale price and therefore no contract between the parties. Up to that time, both parties treated themselves as contractually bound. The parties prepared agreed issues for trial. The first issue identified was whether, as a matter of construction, the purchase price of $700,000 included any amount of GST that might be payable in respect of the sale of the property or is a purchase price of $700,000 with GST on the top. The vendor did not press that issue. Binding Contract 23The first issue pressed is whether there was a binding contract. Mr Wilson SC, referred to what was said by Mahoney JA in Air Great Lakes Pty Ltd v KS Easter (Holdings) Pty Ltd (1985) 2 NSWLR 309 at 326: "The only question considered by Yeldham J was whether there was a binding contract between the parties. In considering this question, in a context such as the present, it is of assistance to distinguish between three questions: did the parties arrive at a consensus?; (if they did) was it such a consensus as was capable of forming a binding contract?; and (if it was) did the parties intend that the consensus at which they arrived should constitute a binding contract?" 24He submitted in this case, the parties did not reach a consensus on price, which was a fundamental term. Three things may be said about this submission. First, the passage relied upon was expressly said to relate to a context such as was present in Air Great Lakes Pty Ltd v KS Easter (Holdings) Pty Ltd. There the parties had written into a written agreement which contemplated entry into a further agreement. The question was into which category of case described in Master v Cameron (1954) 91 CLR 353 the case fell. Secondly, since Air Great Lakes Pty Ltd v KS Easter (Holdings) Pty Ltd was decided in 1985, the Courts have moved even more strongly to a position reflecting what is being called the objective theory of contract. The intention of parties to enter into a contract is to be ascertained objectively, (as McHugh JA said in Air Great Lakes at 337; but compare Mahoney JA at 330-331). It is to be ascertained objectively, including by what the parties said, did and wrote. In Ermogenous v Greek Orthodox Community of SA Inc [2002] HCA 8; (2002) 209 CLR 95, Gaudron, McHugh, Hayne and Callinan JJ said at [25], 105: "[25] Because the inquiry about this last aspect may take account of the subject-matter of the agreement, the status of the parties to it, their relationship to one another, and other surrounding circumstances, not only is there obvious difficulty in formulating rules intended to prescribe the kinds of cases in which an intention to create contractual relations should, or should not, be found to exist, it would be wrong to do so. Because the search for the 'intention to create contractual relations' requires an objective assessment of the state of affairs between the parties (as distinct from the identification of any uncommunicated subjective reservation or intention that either may harbour) the circumstances which might properly be taken into account in deciding whether there was the relevant intention are so varied as to preclude the formation of any prescriptive rules. Although the word "intention" is used in this context, it is used in the same sense as it is used in other contractual contexts. It describes what it is that would objectively be conveyed by what was said or done, having regard to the circumstances in which those statements and actions happened. It is not a search for the uncommunicated subjective motives or intentions of the parties." (Footnotes omitted.) See also Toll (FGCT) Pty Ltd v Alphapharm Limited [2004] 219 HCA 52; (2004) 219 CLR 165 at [38] and [40]. The High Court there said: "[38] It is not in dispute that Mr Gardiner-Garden was authorised by Richard Thomson to sign the Application for Credit, and that when he signed that document he did so intending that it would affect the legal relations between Richard Thomson and Finemores. So much was acknowledged in the course of argument in this Court. Counsel for Richard Thomson said that there was no suggestion that the document that was signed was not intended to create legal relations. In their consideration in Ermogenous v Greek Orthodox Community of SA Inc. of the requisite intention to create contractual relations, Gaudron, McHugh, Hayne and Callinan JJ said: Although the word 'intention' is used in this context, it is used in the same sense as it is used in other contractual contexts. It describes what it is that would objectively be conveyed by what was said or done, having regard to the circumstances in which those statements and actions happened. It is not a search for the uncommunicated subjective motives or intentions of the parties. The point at issue on this appeal concerns not the creation of legal relations but the nature of the legal relations created. ... [40] This Court, in Pacific Carriers Ltd v BNP Paribas, has recently reaffirmed the principle of objectivity by which the rights and liabilities of the parties to a contract are determined. It is not the subjective beliefs or understandings of the parties about their rights and liabilities that govern their contractual relations. What matters is what each party by words and conduct would have led a reasonable person in the position of the other party to believe. References to the common intention of the parties to a contract are to be understood as referring to what a reasonable person would understand by the language in which the parties have expressed their agreement. The meaning of the terms of a contractual document is to be determined by what a reasonable person would have understood them to mean. That, normally, requires consideration not only of the text, but also of the surrounding circumstances known to the parties, and the purpose and object of the transaction." 25An exchange of contracts in identical terms is objectively the clearest indication that the parties intend to be bound by the terms of the contracts exchanged. In Sindel v Georgiou (1984) 154 CLR 661, the High Court said (at 666) that "the ceremony of exchange constitutes a mutual acknowledgment that the bargain has been struck". As I have said, it is clear that for a considerable time after exchange, both parties considered themselves to be contractually bound. The reason that a different result is contended for is that the parties were not ad idem on the price that would be payable. But they were ad idem on the terms of the contract. They both understood and intended that the price that would be payable would be the price specified in the contract, which was to be determined in accordance with the contractual terms. 26 They differed as to their understanding as to the effect of those terms, but that does not connote a lack of consensus about the contractual terms. Accordingly, I reject the vendor's argument that there is no binding contract because there was no such consensus. No rescission available for unilateral mistake 27The second issue is whether the contract can be vitiated for the vendor's mistake. It is clear that, at least up to 28 May 2013, the vendor did labour under a mistake as to the effect of the contractual terms. It is clear from Mr Bisley's affidavit that that mistake continued notwithstanding the letter from Hansons of 28 May 2013. 28It is not quite so clear whether the purchaser, through its solicitor, was of the view that the vendor continued to labour under the mistake up to the time of exchange. Thomas & Bisley had invited the purchaser to advise the basis on which it wished to proceed. Hansons had advised that the purchaser wished to proceed on the basis of the contract as submitted with no amendments, and had proffered their view as to the effect of that. The letter from Thomas & Bisley of 3 June 2013 repeated that the property was offered by the vendor on the terms and conditions of the contract that had been submitted and had been executed by the purchaser. 29Mr Gallinar, the sole director of the purchaser, gave evidence, but was not cross-examined on his knowledge or belief as to whether the vendor continued to labour under a mistake. The purchaser's solicitor did not give evidence. 30Although it is not entirely clear, I infer that Hansons were of the view that Thomas & Bisley had not been persuaded by the views expressed in Hansons' letter of 28 May 2013 to which Thomas & Bisley had responded, but adhered to the view they had earlier expressed. I infer that Hansons considered Thomas & Bisley's view about the effect of the contract to be mistaken. But they also would have known that Mr Bisley did not consider the view he held to be mistaken. Having asserted their view as to the effect of the terms of the contract, Hansons were not under any further obligation to seek to educate Thomas & Bisley as to the proper construction of the contract. 31In Taylor v Johnson [1983] HCA 5; (1983) 151 CLR 422, the High Court dealt with the principles upon which a contract may be liable to be rescinded, where one party has entered into it under a serious mistake in relation to a fundamental term. In that case, an option agreement was entered into which, if the option were exercised, provided for a sale of a property of some five acres for a total price of $15,000. The vendor believed that the contract provided for a price of $15,000 per acre. 32The majority of the High Court (Mason ACJ Murphy and Deane JJ) said (at 427) that a general inference was that the purchaser and the vendor believed that the other was acting under a mistake or misapprehension either as to price or value in agreeing to a sale at the purchase price which he or she believed the other had accepted. 33The contract was not void because of the lack of consensus as to price. But the majority held that the contract was liable to be rescinded. This was because the purchaser believed that the vendor was under a serious mistake or misapprehension about the price or the value of the land, and deliberately set out to ensure that the vendor did not become aware that she was being induced to grant the option and subsequently to enter into the contract of sale by a material mistake or misapprehension as to its terms or subject matter (at 433). The proposition of law applied was that: "The particular proposition of law which we see as appropriate and adequate for disposing of the present appeal may be narrowly stated. It is that a party who has entered into a written contract under a serious mistake about its contents in relation to a fundamental term will be entitled in equity to an order rescinding the contract if the other party is aware that circumstances exist which indicate that the first party is entering the contract under some serious mistake or misapprehension about either the content or subject matter of that term and deliberately sets out to ensure that the first party does not become aware of the existence of his mistake or misapprehension." 34A deliberate course of cloaking the other party's mistake is one basis for finding the contract can be vitiated for unilateral mistake. I would accept that if it were shown that the other party was aware of the mistake, being a serious mistake about a fundamental term, and otherwise acted unconscionably, that the contract would be liable to be rescinded. (See Misiaris v Saydels Pty Limited (1989) NSWConvR 55-474 at 58-447-58-449.) 35The question is whether the plaintiff purchaser played such a part in the vendor's labouring and continuing to labour under the mistake that it is unconscientious for it to seek to hold the vendor to the contract. 36Here, the purchaser's solicitor had pointed out to the vendor's solicitor what the purchaser contended to be the proper construction of the contract. The vendor proceeded nonetheless. Both parties expected that they would be able to enforce the contract as they understood its effect. 37The purchase's solicitor had invited the vendor to make an amendment to the contract, and that invitation was made in the context of the purchaser's asserting what was plainly the correct interpretation of the contract. The vendor did not accept that invitation. 38The purchaser had made it clear that it wanted and was prepared to pay a price only of $700,000 inclusive of GST, and then made it clear that, in its view, that would be the price it was responsible to pay if contracts were exchanged on the terms the vendor had offered. The vendor proceeded nonetheless without seeking to make any amendment that would bring greater clarity to the position. In my view, there is nothing unconscientious in the purchaser's seeking to hold the vendor to the contract. 39Accordingly, in my view, the contract is not liable to be rescinded by reason of the vendor's mistake. No discretionary defence 40I turn then to whether the remedy of specific performance should be refused as a matter of discretion, its being a discretionary remedy. 41In Slee v Warke (1949) 86 CLR 271, the High Court said (at 278-279) that the general rule governing the exercise of a discretion to refuse a decree for specific performance, where there is a unilateral mistake on the part of the defendant not contributed to by the plaintiff, is that laid down in Tamplin v James (1880) 15 Ch D 215 at 221, namely, that there be hardship amounting to injustice which would be inflicted by holding the defendant to the contract, and it would be unreasonable to hold the defendant to the contract. 42In the present case, the defendant disclaimed hardship. I do not think it would be unreasonable to enforce the contract against the vendor. 43Mr Bisley gave evidence that: "That contract was marked on the front page as a sale being a taxable supply in full and in accordance with the provisions of printed provision 20.15 of the contract the margin scheme was not to apply. This was done because in my experience when contracts relate to commercial properties as distinct from residential properties and the sale is marked as being a taxable supply in full with the margin scheme not apply, the sale price quoted in the contract is plus GST not inclusive of GST irrespective of the provisions of printed condition 13.2 of the contract." 44That seems to be a statement that the contract was completed as it was because the vendor's solicitor was relying on what he understood to be a practice that applied notwithstanding the contractual terms. No such practice could contradict the terms of the contract. I do not know what the practice is to which Mr Bisley referred, but it is not unreasonable if the contract was prepared on that basis to hold the vendor to it. 45Mr Wilson submitted that there are broader discretionary grounds on which a decree for specific performance can be refused. He referred to the decision of Young J (as his Honour then was) in Borg v Howlett [1996] NSWSC 153, where his Honour suggested that the Court of Appeal's decision in Boulas v Angelopoulos (1991) 5 BPR 11,477; (1991) NSWConvR 55,606 established that, notwithstanding what had been said in Slee v Warke, there was a discretion to decline to enforce specific performance and to leave the parties to their remedy at law whenever a mistake is made by a party to a sale transaction. 46For my part, I do not understand Kirby P in Boulas v Angelopoulos to have intended to depart from what was said in Slee v Warke. In any event, what his Honour said in relation to a discretion to refuse to grant specific performance does not appear to have had the concurrence of Gleeson CJ and Samuels JA, and was obiter. 47In any case, however wide the discretion, I do not think it would be just to refuse a decree for specific performance. To do so would be to remit the parties to a hearing on a claim for damages, the cost of which would be likely to be out of proportion to the amount at stake. 48For these reasons, I reject the defences raised to the claim for specific performance. Orders 49As there is no longer an issue as to the proper construction of the contract, it is unnecessary to make a declaration as to the amount of the purchase price payable on completion. Subject to hearing counsel as to whether any other order is sought, I think the appropriate orders are to: 1. Declare that the plaintiff and the defendant are bound by a contract for sale of the property located at 18 Beach Street, Wollongong, (lot eight in DP 17531) (the 'property') exchanged on 6 June 2013. 2. Order that the defendant specifically perform the contract in accordance with its terms. 50Is there any other order, other than as to costs, which is sought and which is appropriate? [Parties address.] 51I make that declaration and order. I will hear the parties on costs. Is there anything you want to say on costs? [Parties address.] 52I order that the defendant pay the plaintiff's costs. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 28 April 2014