Linfield Developments Pty Limited v Shuangxing Development Pty Limited [2016] NSWSC 68

Supreme Court New South Wales

Medium Neutral Citation: Linfield Developments Pty Limited v Shuangxing Development Pty Limited [2016] NSWSC 68 Hearing dates: 1, 2, 3, 4, 5, 8, 9, 10 and 11 February 2016 Decision date: 14 March 2016 Jurisdiction: Equity Before: Pembroke J Decision: Specific performance granted Catchwords: CONTRACT – conditional call option – contractual right granted by a purchaser to a third party – whether equitable interest in land acquired by third party before purchaser completes purchase CONTRACT – conditional call option – whether equitable interest in land acquired before event of default or exercise of option PRIORITY – competing equitable interests – test for resolution of priority – merits not equal – better equity – general and flexible principle – not dependent on conduct of holder of prior interest being causative of acquisition of later interest PENALTY – a question of construction and characterisation – evidence of value of land irrelevant PENALTY – to be assessed at time of making contract VALUATION – hypothetical development methodology – judicial recognition of weakness of approach – uncertainties inherent in method EVIDENCE – credibility – utmost importance of contemporaneous documents AFFIDAVITS – credibility – limited utility – utmost importance of contemporaneous documents SPECIFIC PERFORMANCE – hardship to defendant – no reason to ameliorate consequences – self-induced conduct Legislation Cited: Australian Consumer Law (Competition and Consumer Act 2010 (Cth) Sch 2) Contracts Review Act 1980 (NSW) Cases Cited: 15 Lorimer Street Pty Ltd v Secretary to the Dept of Infrastructure (1997) 97 LGERA 239 Avco Financial Services Ltd v Fishman [1993] 1 VR 90 Beneficial Finance Corporation Ltd v Multiplex Constructions Pty Ltd (1995) 36 NSWLR 510. Brewarrana Pty Ltd v Commissioner of Highways (No 1) (1973) 32 LGRA 170 Brown v Heffer (1967) 116 CLR 344 Cash Resources Australia Pty Ltd v BT Securities Ltd [1990] VR 576 Caswell v Sony/ATV Music Publishing (Australia) Pty Ltd [2014] NSWSC 841 Champion Home Sales Pty Ltd v JKAM Investments Pty Ltd; Hotray Pty Ltd v JKAM Investments Pty Ltd [2014] NSWSC 952 Circuit Finance Australia (Receivers and Managers appointed) (in liquidation) v Panella [2011] NSWSC 311 Clydebank Engineering and Shipbuilding Company v Don Jose Ramos Yzquierdo Y Castaneda [1905] AC 6 Coastal Estates Pty Ltd v Bass Shire Council [1993] 2 VR 566 Co-ordinated Resources Pty Ltd v Valuer-General (1983) 27 The Valuer 779 Cranston v CBFC Ltd Supreme Court of New South Wales, unreported, 11 June 1993 Dunlop Pneumatic Tyre Company Limited v New Garage and Motor Company Limited [1915] AC 79 Elderly Citizens Homes of SA Inc v Balnaves (1998) 72 SASR 210 Equuscorp Pty Ltd v Glengallan Investments Pty Ltd [2004] HCA 55 Forder v Cemcorp Pty Ltd (2001) 51 NSWLR 486 Forrest & Barr v Henderson & Co (1869) 8 M 187 Gestmin SCPS SA v Credit Suisse (UK) Ltd & Anor [2013] EWHC 3560 GPT Re Ltd v Lend Lease Real Estate Investments Ltd [2005] NSWSC 964 Gwynvill Properties Pty Ltd v Commissioner for Main Roads (1983) 50 LGRA 322 Jessica Holdings Pty Ltd v Anglican Property Trust Diocese of Sydney (1992) 27 NSWLR 140 Lend Lease Real Estate Investments Ltd v GPT Re Ltd [2006] NSWCA 207 Mealey v Power [2015] NSWSC 1678 Onassis and Calogeropoulos v Vergottis [1968] 2 Lloyd's Rep 403 Paciocco v Australia & New Zealand Banking Group Ltd [2015] FCAFC 50 Palm Gardens Consolidated Pty Ltd v P G Properties Pty Ltd [2009] SASC 311 Palmalco Pty Ltd v Minister Administering the National Parks and Wildlife Act 1974 (No 3) (1991) 71 LGRA 441 Person to Person Financial Services Pty Ltd v Sharari [1984] 1 NSWLR 745 Re Henderson's Caveat [1998] 1 Qd R 632 Re Kakadu Resources Ltd [1992] 2 VR 610 Re Premier Freehold Pty Ltd's Caveat [1981] Qd R 547 Radoman Pty Ltd v Vexapu Pty Ltd [2008] NSWSC 8 Ringrow Pty Ltd v BP Australia Pty Ltd [2005] HCA 71 Seven Network (Operations) Limited v Warburton (No 2) [2011] NSWSC 386 S S Pharmaceuticals v Qantas [1991] 1 Lloyd's Rep 288 Thomas v SMP (International) Pty Ltd [2010] NSWSC 822 Watson v Foxman (1995) 49 NSWLR 315 Western Australian Planning Commission v Arcus Shopfitters Pty [2003] WASCA 295 Category: Principal judgment Parties: Linfield Developments Pty Limited – plaintiff Shuangxing Development Pty Limited – first defendant Xiuyan Guan – second defendant Shuangling International Development Pty Limited – third defendant Shuangfu Development Pty Limited – fourth defendant Shuang Sheng Pty Limited – fifth defendant Australia Capital Financial Management Pty Limited – sixth defendant Representation: Counsel: A S Bell SC with C Freeman – plaintiff J E Sexton SC with V Whittaker – first and sixth defendants M Condon SC with I Leong – second, third and fifth defendants S Gallant (solicitor) – fourth defendant