Grubisa v Zhou [2025] NSWSC 942 | Case summary | Zoe

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Grubisa v Zhou [2025] NSWSC 942 | Case summary | Zoe

The essence of the dispute between the parties is the date of a contract for sale of a property at Brighton Drive, Bella Vista, New South Wales (the Property) owned by the defendant which the plaintiff agreed to buy for $3,700,000.
The defendant contends that the date of the contract is 17 May 2024 whereas the plaintiff contends that it was 23 May 2024. The issue arises in the context of it not being disputed that the contract required settlement 26 weeks from the “contract date”. On 20 November 2024, the defendant served a notice to complete on the plaintiff requiring completion by 4 December 2024. This was subsequently extended to 11 December 2024. Completion did not occur by then and on 11 December 2024 the defendant issued a notice purporting to terminate the contract.
The plaintiff contends, in essence, that the notice to complete is invalid because it was issued less than 26 weeks after the contract date of 23 May 2024 and as such the purported termination based on the notice was invalid.
Prior to the day before the hearing, the plaintiff’s primary case was for specific performance of the contract. The plaintiff had lodged two caveats on the title to the Property. By cross-summons, the defendant sought an order removing the caveats and an order for compensation pursuant to s 74P of the Real Property Act 1900 (NSW) (RPA). The defendant has entered into a contract to sell the Property to a third party for $3.8 million. If settlement does not occur by 15 September 2025, the purchaser has a right to rescind the contract.
The proceeding was heard on 23 July 2025. Shortly after 4pm on 22 July 2025, counsel for the plaintiff notified the Court and the defendant that the plaintiff no longer pressed his claim for specific performance but sought refund of the deposit, including pursuant to s 55(2A) of the Conveyancing Act 1919 (NSW) (CA).
The plaintiff withdrew the first caveat on 14 July 2025 and consented to an order that the second caveat be forthwith withdrawn. I made an order to this effect on 23 July 2025.
The defendant contended that it was not open to the plaintiff to seek return of the deposit pursuant to s 55(2A) of the CA. Having heard argument on 23 July 2025 including as to how the plaintiff put this aspect of the case, I ruled that the plaintiff should be permitted to rely on s 55(2A) essentially for the reason that the defendant was able to meet the case put. Once counsel for the plaintiff clarified the matters relied on in support of the new s 55(2A) claim, counsel for the defendant candidly accepted that he could not identify any prejudice.
Mr J O’Sullivan appeared for the plaintiff and Mr S Philips for the defendant.
For the reasons set out below, the plaintiff’s claim fails.

At 3.27 pm on 18 November 2024, the defendant’s solicitor responded to the effect that the defendant did not agree to the requested settlement extension. If settlement did not occur on 18 November 2024, it was foreshadowed that a Notice to Complete would be issued. A subsequent email from the defendant’s solicitor requested a replacement deposit bond be provided as soon as possible.
At 5.57 pm on 18 November 2024, a Notice of Default was served by email from the defendant’s solicitor to the plaintiff’s solicitor. The default alleged in the notice concerned the deposit bond. The plaintiff was requested to serve a replacement deposit bond and complete the settlement.
On 19 November 2024, the plaintiff’s solicitor emailed the defendant’s solicitor following on from a phone call between the two. The email requested for completion to be scheduled for 20 December 2024.
Shortly thereafter on 19 November 2024, the defendant’s solicitor responded, not agreeing to extend settlement to 20 December 2024. The email advised that if a replacement deposit bond was not provided by 5 pm that day, the defendant would terminate the contract and draw on the bond. If a replacement deposit bond is provided, the vendor would not terminate but issue a notice to complete allowing up to 14 days to settle.
The correspondence continued.
On 20 November 2024, a replacement deposit bond was provided. At 5.50 pm on 20 November 2024, the defendant issued a Notice to Complete requiring completion by 4 December 2024 and stating that time was of the essence.
Settlement sheets were then exchanged nominating 2 December 2024 as the intended settlement date.
Throughout this period, the plaintiff was continuing to seek to obtain finance to enable him to complete on the purchase.
In about late November 2024, the plaintiff engaged new solicitors. On 2 December 2024, the plaintiff lodged a caveat on title to the Property (First Caveat). It incorrectly described the plaintiff’s interest as a mortgage. On 3 December 2024, the plaintiff’s new solicitor wrote to the defendant’s solicitor. The email asserted that the Notice to Complete was invalid because it relied on an incorrect settlement date of 17 November 2024 based on a contract date of 17 May 2024. The email asserted for the first time, that the contract only became enforceable on 23 May 2024 when the deposit bond and s 66W certificate were provided. It was asserted that the 26 week period commenced to run on 23 May 2024.
The email further stated, under the heading “1.3 Readiness to Settle”:

The plaintiff was extensively cross-examined as to his ability to raise the necessary funds to complete the purchase of the Property. The plaintiff was no doubt optimistic that he would be able to raise the necessary funds and gave evidence of potential alternative, and more expensive, sources of funds. The simple fact is that he was not able to raise the necessary funds.
The solicitors for the respective parties then sought to negotiate for settlement to occur on or before 4.30 pm on 11 December 2024. The plaintiff’s position was that the defendant was required to issue a new Notice to Complete which the defendant did not agree with.
On 4 December 2024, the plaintiff’s solicitor emailed the defendant’s solicitor contending that the valuer appointed by the plaintiff’s mortgagee was denied access to the Property to carry out their valuation further delaying settlement. There was some suggestion that this denial of access was a reason why finance was not obtained prior to termination by the defendant. I do not accept this. Shortly after the email from the plaintiff’s solicitor, the defendant’s solicitor directly communicated with the potential lender confirming that the defendant was willing for settlement to occur on or before 4 pm on 11 December 2024, subject to conditions which were set out. The email further stated that if access is requested, please arrange it directly with the agent as the Property is subject to tenancy.
On 6 December 2024, the defendant’s solicitor wrote to the plaintiff’s solicitor to the effect that the defendant was agreeable to extending the settlement to 11 December 2024 on the basis that penalty interest would continue to accrue from 18 November 2024 until completion.
Completion did not occur by 11 December 2024. At 5.25 pm on 11 December 2024, the defendant’s solicitor served a Notice of Termination on the plaintiff’s solicitors. Later that day the plaintiff’s broker wrote to the defendant’s solicitor seeking recission of the Notice of Termination and proposing settlement on 23 December 2024.
The proceedings were commenced on 13 January 2025.
In March 2025, the defendant re-listed the Property for sale.
Prior to this time and since termination, the defendant had been overseas in China on holiday.
On 16 June 2025, the defendant exchanged contracts for the sale of the Property with new purchasers for $3.8 million. Shortly thereafter, on 26 June 2025, a second caveat was lodged by the plaintiff this time better describing the plaintiff’s caveatable interest (Second Caveat).
On 8 July 2025, the defendant’s solicitor wrote to the plaintiff’s solicitor requesting removal of the caveats. On 14 July 2025, the plaintiff withdrew the First Caveat.
As set out above, at the hearing before me on 23 July 2025, consequent upon the plaintiff no longer seeking specific performance, the plaintiff consented to an order that he withdraw the Second Caveat, which I then made on 23 July 2025.
Under the terms of the contract for sale of the Property entered into between the defendant and new purchasers in late June 2025, in the event that settlement does not occur by 16 September 2025 for the vendor’s default, including because the caveats are not removed, the purchasers have the right to rescind the contract.

There was no suggestion that these terms were not in fact agreed prior to execution of the Authority to Exchange. They were. In any event, the parties’ execution of the Authority to Exchange manifests their agreement.
Under the heading “DEPOSIT BY INSTALMENTS” the purchaser (plaintiff) promises on execution of the Authority to pay the vendor’s (defendant’s) agent the total deposit of $370,000. Provision is then made for the deposit to be paid by instalments with the second instalment due after the five day cooling off period.
Under the heading “Purchaser/s” the plaintiff, relevantly, confirms that he has executed an agreement for the sale of land. Further, the plaintiff acknowledges that he has expressly authorised the agent to attend to the exchange of contracts on his behalf, that he is aware of the five day cooling off period and that after this period the agreement is unconditional. The plaintiff also acknowledges his awareness of “the completion date of the contract as per special condition”.
Each of the plaintiff and defendant executed counterpart contracts in identical terms which were provided to the agent along with the Authority.
It is clear on the evidence that the agent then exchanged contracts, pursuant to the authority granted to him, on 17 May 2024. Both contracts are dated 17 May 2024 and it appears the agent provided the executed documents to the plaintiff’s and defendant’s solicitors on 20 and 22 May 2024 respectively. 17 May 2024 was a Friday and the Docusign records show that it was early in the evening when the defendant signed the documents and returned them to the agents.
The parties were clearly following the customary method of making a binding contract for the sale of land by the exchange of counterparts: see Allen v Carbone (1975) 132 CLR 528; [1975] HCA 14 at 533 per Stephen, Mason and Murphy JJ. A binding agreement was reached on exchange which took place on 17 May 2024. The fact that the agreement was not unconditional until the expiry of the cooling off period or provision of a s 66W certificate does not gainsay this. None of this provides any basis to discern a common intention of the parties that the contract date was only when the contract became unconditional. The contract date was stated on the counterparts – 17 May 2024. It was obviously not in dispute that the three Special Conditions set out in the Authority were not included in the counterpart contracts. This is of no relevant significance in my view. Whilst the exchanged “Contract for Sale of Land” was liable to be rectified to include the three Special Conditions, this would not alter the contract date of 17 May 2024.
The fact that the deposit was not paid at the time of execution and then exchange does not suggest that the intention of the parties was that the contract date was only when the deposit was paid and/or that there was no binding contract until the deposit was paid.
There is nothing to suggest that the parties did not intend to be bound in the customary way, by the exchange of counterpart contracts. The plaintiff was under an obligation to pay the deposit, and it would likely have been open to the defendant to terminate the contract if the deposit was not paid.
An important aspect of the plaintiff’s rectification argument was reliance on apparent commercial common sense. So the argument ran, a vendor would not want to be bound if the deposit had not been received and a purchaser would not want to be bound to buy if it was not able to pay the deposit.
It has often been observed that caution should be exercised by courts in attributing a particular commercial intent or understanding of commercial common sense to parties: see, for example, The J & P Marlow (No 2) Pty Ltd v Hayes and McCabe (2023) 112 NSWLR 29; [2023] NSWCA 117 at [76]-[80] per Bell CJ. I do not accept there is any relevant uncommercial outcome in a binding agreement having been made on 17 May 2024. Much more would also be required to demonstrate the clear and convincing proof necessary to succeed in a rectification claim.
Counsel for the plaintiff also sought to place reliance on the correspondence between the representatives of the parties in the period 17 May 2024 to 23 May 2024. I have set out the correspondence earlier in these reasons. For example, on 17 May 2024 the agent sent an SMS message to the purchaser requesting the deposit bond, or the 0.25% deposit “to hold this property any further” and on 20 May 2024 wrote to the plaintiff’s solicitor referring to the s 66W certificate and deposit bond being sent to the defendant’s solicitor “so that the property can be finalised as sold”. On 22 May 2024, the agent sent an SMS to the plaintiff relevantly stating that “contract can only be complete with deposit receipt or the deposit bond”.
I do not regard these communications as providing any clear or convincing proof of a common intention of the parties as claimed by the plaintiff. They are perfectly consistent with a binding agreement having been reached on 17 May 2024 with the agent chasing the purchaser for the s 66W certificate so that the purchaser would no longer be able to rescind in the cooling off period, and chasing the deposit - which the purchaser was contractually obliged to pay. Once these matters had been satisfied, the agent would then have the necessary comfort to remove the Property from the market. The agent was no doubt seeking to encourage the purchaser to attend to these tasks.
For the same reasons, and although not pleaded, I also do not regard these communications as suggesting, as appeared to be floated by counsel for the plaintiff in closing address, that the parties did not intend to be bound until the deposit had been paid and a s 66W certificate provided.
No case was pleaded that the parties were still negotiating terms until 23 May 2024. Such a case was floated in closing address. Given no such case was pleaded it need not be addressed. In any event I do not read the dealings between the parties on 17 May 2024 and thereafter to 23 May 2024 as demonstrating no agreement until 23 May 2024 when the plaintiff agreed to a minimum rental at which the Property could be rented out. Nothing that occurred after 17 May 2024 leads me to conclude that the parties were not bound by the exchange on 17 May 2024. The email at 12.26 pm on 23 May 2024 is simply recounting the agreement set out in the Authority to Exchange. Agreement had also been reached – as recorded in the Authority to Exchange – for the defendant to rent the Property out. There was nothing to suggest that the whole deal was contingent on the defendant and plaintiff agreeing on the minimum weekly rental.
Reliance was also placed by the plaintiff on a print out from the RP Data platform (operated by CoreLogic Limited) in relation to the Property. The evidence was that the platform “records, among other things, historical property listings and advertising campaigns”. The relevant entry for the Property referred to a campaign from 10 February 2024 to 24 May 2024 with the Property being “sold with 66W by Rahul Sehgal”.
The plaintiff’s contention was that this entry was likely made by the defendant’s agent (Mr Sehgal) and provided some evidence that the contract date was 23 May 2024. As I understood the submission, it was that the Property would not have been taken off the market until there was a binding contract – which was 23 May 2024 – and it would have taken the agent a day or so to take the Property off the market.
The print out is nothing more than an entry made by an unknown person (perhaps Mr Sehgal) as to the date on which the Property ceased to be marketed. Even if it is accepted that a property would have ceased to be marketed after it had been sold, or more accurately the contract date, this has no bearing, in my view, on the date on which the property was in fact sold. This is determined by the dealings between the parties, not an online entry by a third party even if that third party acted as a real estate agent for the vendor. The relevant entry also does not assist being one day after the plaintiff’s contended date of contract. The contention that it would have taken the agent a day or so to make the entry is pure speculation and highlights the irrelevance of the evidence.
I therefore conclude that the contract date was 17 May 2024 – being the date when contracts were exchanged, and the 26 week settlement period ran from this date and not 23 May 2024, as contended for by the plaintiff.
In light of the abandonment of the specific performance claim, it is thus not necessary for me to consider whether the plaintiff was ready, willing and able to complete. I am in no doubt that the plaintiff was willing to complete in November and December 2024. I am also in no doubt that in November and December 2024, the plaintiff was not ready or able to complete because he could not raise the necessary monies. The plaintiff was extensively cross-examined on this topic. The cross-examination demonstrated, quite clearly in my view, that whilst the plaintiff was no doubt working hard to raise the completion monies and was hopeful they would be raised, he was never able to raise the money. It is to be remembered in this regard that even after the defendant had terminated the contract and was asked to withdraw the notice, the plaintiff’s requested settlement date was still 23 December 2024.
In answer to various questions about finance, the plaintiff said that he had alternative sources of finance available but they were considerably more expensive. I am sceptical whether this was in fact the case but in any event, the evidence is irrelevant in circumstances where the plaintiff never obtained the necessary finance.
No attempt was made by the plaintiff to prove that he was ready, willing and able to complete at the time of the hearing. Whilst the claim for specific performance was abandoned, had I found in favour of the plaintiff that the termination by the defendant was wrongful and thus had to determine whether the plaintiff was contractually entitled to a return of the deposit, an issue may have arisen as to whether the plaintiff was required to demonstrate he was ready, willing and able to complete as at 22 July 2025 when the plaintiff elected to bring the contract to an end by reason of the defendant’s allegedly repudiatory conduct: see Lewington v Dulyakarn [2025] NSWSC 635 at [121]-[138].

For the reasons set out above, the plaintiff’s claim fails. The statement of claim should be dismissed.
It is unclear to me whether any further orders are necessary on the cross-claim, save for costs. Counsel for the defendant indicated at the start of the hearing on 23 July 2025 that if the plaintiff was to consent to an order that the Second Caveat be withdrawn and consented to an order that the plaintiff pay the defendant’s costs of the cross-summons in a gross sum to be agreed or determined by the Court within 28 days, then the defendant would not press any relief in relation to the cross-summons. Later that day, the plaintiff consented to an order that the Second Caveat be withdrawn. No consent was forthcoming on costs. No submissions were ultimately advanced by the defendant in support of any other relief on the cross-summons.
The parties requested that I not make any orders as to costs at this stage, but rather determine the substantive issues only.
I am content to go along with this course although it seems to me that absent any application for a special costs order, the appropriate order is that the plaintiff/cross-defendant pay the defendant/cross-claimant’s costs of the statement of claim and the cross-claim. The defendant/cross-claimant also foreshadowed making an application for a gross sum costs order in relation to the cross claim - that is obviously a matter for the defendant/cross-claimant.
The orders of the Court are:
Statement of claim dismissed.
Direct the parties to confer to seek to agree any other orders to give effect to these reasons, including on the cross-claim and as to costs.
Direct the parties to provide to my Associate by no later than 27 August 2025 any agreed orders.
To the extent that orders are not agreed, direct the parties to provide to my Associate by no later than 27 August 2025, the form of orders for which each party contends together with any material and submissions (limited to three pages) in support of those orders.
Direct the parties to provide any material and submissions (limited to two pages) in reply by no later than 5pm on 3 September 2025 whereupon the remaining issues will be determined on the papers.