AMC C11 Pty Ltd v Crown Medical Group Ltd

Medium Neutral Citation: AMC C11 Pty Ltd v Crown Medical Group Ltd [2025] NSWSC 1030

Hearing dates: 5 September 2025

Date of orders: 5 September 2025

Decision date: 09 September 2025

Jurisdiction: Equity - Applications List

Before: Parker J

Decision: See [16]

Catchwords: CONTRACTS – sale and purchase of a business – where contract rescinded for failure to complete a special condition – where purchaser is entitled to recovery of deposit paid under standard form contract clause.
CIVIL PROCEDURE – plaintiff’s application seeking default judgment – where statement of claim does not seek judgment in the amount of the deposit as a liquidated sum – no defence filed by vendor – Uniform Civil Procedure Rules 2005 (NSW), r 16.10 – where evidence and pleadings show purchaser’s cause of action in recovering deposit – default judgment entered for the plaintiff and costs ordered

Legislation Cited: Uniform Civil Procedure Rules 2005 (NSW) rr 16.6, 16.10

Category: Principal judgment

Parties: Principal proceedings
AMC C11 Pty Limited (Plaintiff)
Crown Medical Group Limited (Defendant)
Notice of Motion filed 13 August 2025
AMC C11 Pty Limited (Plaintiff/Applicant)

Representation: Counsel:
C Beshara (Plaintiff/Applicant)
Solicitors:
Doorkeeper Legal (Plaintiff/Applicant)

File Number(s): 2024/464295

Publication restriction: Nil

JUDGMENT- EX TEMPORE

Revised from transcript; issued on 9 September 2025

1. In these proceedings, the plaintiff, who is the purchaser under a contract for the sale and purchase of a business, seeks to recover its deposit from the defendant, who is the vendor under that contract. The business in question is a medical centre located in the Wollongong suburb of Figtree. The contract has been rescinded, and the plaintiff now moves for default judgment.

2. The contract was a Law Society of New South Wales standard form contract for the sale and purchase of business – 2021 edition, consisting of 36 standard form (“SF”) clauses. There were also additional special condition (“SC”) clauses.

3. The purchase price of the business under the contract was $3.55 million. The deposit was $371,700. SF cl 48.1 contained an acknowledgement that this deposit had already been paid. This was because the contract was entered into further following the rescission of an earlier contract for the sale and purchase of the same business.

4. SC cl 49.2 set out various conditions upon which completion depended. SC cl 49.6 provided that if any of those conditions were not satisfied, then either party might, by notice, rescind the contract. SF cl 23.2.1 provided that, upon rescission of the contract, the purchaser was entitled to a refund of its deposit.

5. One of the conditions upon which completion depended was the grant to the purchaser of a new lease over the premises where the business was being conducted. That condition was not satisfied by the date specified in the contract, which was 1 November 2024.

6. On 4 November, the solicitors for the vendor issued a notice of rescission. Their correspondence alleged that the failure to obtain the lease of the premises by the relevant date was due to a default on the part of the purchaser. The letter further asserted that, as a result, the vendor had suffered damage in an amount exceeding the deposit. Accordingly, the vendor’s solicitors intimated that the deposit monies, which were being held by them in their trust account, would be paid into court, and that was done, resulting in separate proceedings in the Equity Division of this Court (with matter number 2024/00462072).

7. The solicitors for the purchaser disputed the allegation that the contract had gone off as a result of their client’s default. The present proceedings were commenced by a statement of claim on 13 December 2024.

8. On 23 December, an appearance was entered on behalf of the defendant by Ms Ranjani Sundar of the law firm, HFW Australia. Proceedings came before the Registrar for case management in the usual way. On 17 June 2025, the Registrar directed that the vendor file its defence by 27 June. These orders were made following negotiations between the solicitors for the parties and with the consent of the vendor’s solicitors. The defence, however, was not filed by the date required by the directions, and no defence has been filed by the vendor in the proceedings since.

9. On 10 July 2025, Ms Sundar filed a notice of ceasing to act for the vendor. Since then, it has been unrepresented in the proceedings.

10. The purchaser’s notice of motion before me was filed on 6 August. It seeks judgment against the vendor in the amount of $371,700, being the deposit monies paid, together with interest and the maximum costs which may be recovered on an application such as this under the Uniform Civil Procedure Rules (“UCPR”). The application is supported by an affidavit which satisfies the requirements of UCPR r 16.6(2). There is evidence before the Court of the service of the notice of motion and supporting affidavit on the vendor at its registered office.

11. The notice of motion also seeks a “declaration” that the sum of money paid into court in the other proceedings constitutes the deposit under the contract, and that the plaintiff is entitled to have those monies paid out of court. I was informed from the bar table that there is a question as to the solvency of the vendor. The purpose of seeking the declaration is to ensure that the purchaser may satisfy its entitlement to have the deposit repaid out of the monies which have been paid into court.

12. So far as I can see, there is no basis for that claim. Counsel accepted that the purchaser’s entitlement to have the deposit refunded was an unsecured one. Although, in an appropriate case, the Court might shortcut recovery of an unsecured claim by ordering the payment of monies out of court, it would be quite inappropriate to do so if there is any question about the vendor’s solvency. Accordingly, I indicated that I would not make the declaration sought by the purchaser. If an application is to be made to have the monies paid out of court, it should be made in the other proceedings.

13. This brings me back to the claim for the entry of judgment, and costs. As it happens, the amended statement of claim does not contain a prayer for relief seeking the entry of judgment for the amount of the deposit as a liquidated sum. However, that does not matter. UCPR r 16.10 provides:

16.10 Judgment not limited by plaintiff’s claims for relief

Whatever the plaintiff’s claims for relief against a defendant in default, the court may, on application by the plaintiff, give such judgment against the defendant as the plaintiff appears to be entitled to on his or her statement of claim.

14. The evidence before the Court establishes that the plaintiff is entitled to a refund of the deposit. I am satisfied that the statement of claim sufficiently pleads the elements of the plaintiff’s cause of action to recover it. Accordingly, I consider that the plaintiff is prima facie entitled to default judgment under the UCPR, and there is no discretionary factor which would dissuade the Court from making that order.

15. In the course of the hearing, it was revealed that the purchaser had earlier provided security for costs in the sum of $30,000. Counsel for the purchaser sought to have this amount released. Although not claimed in the notice of motion, I think this order is consequential upon it, and no unfairness will be done to the vendor if I make the order now. Indeed, it will be a more efficient course than requiring a further application with inevitable further costs.

16. The orders of the Court are:

17. Direct judgment for the plaintiff against the defendant in the amount of $371,700 together with interest down to judgment in the sum of $23,182.

18. Order that the defendant pay the plaintiff’s costs in the amount of $1,596 and filing fees in the sum of $3,699.

19. Order that the security lodged by the plaintiff for the costs of the defendant be released to the plaintiff forthwith.

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