Gladio Pty Ltd v Buckworth [2015] NSWSC 922

Supreme Court New South Wales

Medium Neutral Citation: Gladio Pty Ltd v Buckworth [2015] NSWSC 922 Hearing dates: 2 March 2015, 15 June 2015, 16 June 2015, 17 June 2015, 18 June 2015 and 19 June 2015 Decision date: 14 July 2015 Jurisdiction: Equity Division Before: McDougall J Decision: Plaintiff to have judgment against first defendant for $145,000 plus interest. Judgment for second defendant and for cross-defendants. Costs reserved. Parties to bring in draft orders. Catchwords: CONTRACT – rescission – contract for sale of shares in company – where shares carried right to exclusive occupation of an apartment held in 'company title' – where cl 6.1 of the contract required the company to consent unconditionally to the transfer – where consent was given, provided that the purchaser accede to certain amendments to the 'house rules' – whether such consent sufficient for cl 6.1

CONTRACT – rescission – where cl 10(g) of the contract required company to keep proper records – whether cl 10(g) a condition or a mere warranty – where company failed to minute a decision to grant a revocable licence allowing the former shareholder to install an air-conditioning system – where purchaser had no means of ascertaining the existence of that licence or that it was revocable at will – whether purchaser entitled to rescind under cl 10(g)

EQUITY – innocent misrepresentation – where vendor at all material times had a copy of a letter setting out the terms of the licence – where vendor failed to disclose licence to purchaser – where a reasonable purchaser would assume the air-conditioning was included – whether vendor's omission amounted to an implied representation that the air-conditioning was entirely 'within Unit 20' – whether it amounted to an implied representation the purchaser would have exclusive rights to use the air-conditioning