HG & R Securities Pty Limited v Sayer

Australian Broadcasting Corporation v XIV Commonwealth Games (1988) 18 NSWLR 540 Bell v Scott (1922) 30 CLR 387 Beynon v Wongala Holdings Pty Limited [1999] NSWSCA 66 Brickles v Snell [1916] 2 AC 599 Carr v Finance Corporation of Australia (1982) 150 CLR 139 Castle Hill Tyres v Luxspice Pty Limited 7 BPR 14, 959 Clarke v Japan Machines (Australia) Pty Limited [1984] 1 Qd R 404 Collingridge v Sontor (1997) 141 FLR 440 Crowe v Rindock Pty Ltd [2005] NSWSC 375 Dainford v Yulura (1984) NSW Conv R 55-184 Dickinson v Dodds [1876] 2 Ch 463 Emerald Securities Pty Limited v Tee Zed Enterprises Pty Limited (1981) 28 SASR 214 Fekala Pty Ltd v Castle Constructions Pty Ltd [2002] NSWCA 297 Fibrosa Spolka Akcyjna v Fairbairn Lawson Combe Barbour Ltd [1943] AC 32 Film Bars Pty Limited v Pacific Film Laboratories Pty Limited (1979) 1 BPR 9251 Foran v Wight (1989) 168 CLR 385 G R Securities Pty Limited v Baulkham Hills Private Hospital Pty Limited (1986) 40 NSWLR 631 Halkett v Earl of Dudley [1907] 1 Ch 590 CASES CITED : In re National Provincial Bank of England v Marsh [1895] 1 Ch 190 Jillinda Pty Limited v McCourt [1983] NSW Conv R 55 145 Laurinda Pty Ltd v Capalaba Park Shopping Centre Pty Ltd (1989) 166 CLR 623 Lohar Corporation Pty Ltd v Dibu Pty Ltd (1976) 1 BPR 9177 Louinder v Leis (1982) 149 CLR 509 Manton v Parabolic Pty Limited (1985) 2 NSWLR 361 McNally v Waitzer [1981] 1 NSWLR 294 National Westminster Finance Australia Limited v Jackson (Giles J, 8 July 1988, unreported) Neeta (Epping) Pty Limited v Phillips (1974) 131 CLR 286 Nemeth v Reachord Pty Limited (1998) 9 BPR 16,557 Ng v Chong [2005] NSWSC 270 Re Barr's Contract [1956] Ch 551 Re Scott and Alvarez's Contracts; Scott v Alvarez [1895] 2 Ch 603 Segulin v Car Owners Mutual Insurance Co Limited (1984) NSW ConvR 55-191 Sindel v Georgiou (1984) 154 CLR 661 Stickney v Keeble [1915] AC 386 Valoutin Pty Limited & Anor v Furst & Ors (1998) 154 ALR 119 Van Minh Lam v Tuan Hung Nguyen [2003] NSWSC 119 Wilde v Anstee (1999) 48 NSWLR 387 Zaccardi v Caunt, [2008] NSWCA 202

C J Rossiter, Requisitions and Objections on Title: The time for delivery; the vendor's obligation to answer properly made requisitions; the purchaser's remedy for inadequate or erroneous answers (2000) 8 Australian Property Law Journal 1 TEXTS CITED : ICF Spry, Equitable Remedies, 6th Ed. Professor Butt in The Standard Contract for Sale of Land in New South Wales (2nd ed)

PARTIES : HG & R Securities Pty Limited (Plaintiff) Michael John Sayer (Defendant)

COUNSEL : M W Young (Plaintiff) N Obrart (Defendant)

SOLICITORS : Bransgroves (Plaintiff) Sarvaas Ciaparras Lawyers (Defendant)

• 10 - IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

2443/07 HG & R SECURITIES PTY LTD V MICHAEL JOHN SAYER JUDGMENT 1 In this matter, the plaintiff (H G & R Securities), the vendor as mortgagee in possession under a Contract for Sale of Land dated 12 December 2006 ("Contract"), claims recovery of the deposit paid under the Contract and damages from the first defendant (Michael John Sayer) for his failure, as purchaser, to complete the Contract. 2 The Contract was for the sale of land in Burwood for the sum of $2,525,000 exclusive of GST. The completion date under the Contract was 23 January 2007. Completion did not take place on that day. A notice to complete was first issued on 13 February 2007 requiring completion by 28 February 2007. A subsequent notice to complete was issued on 8 March 2007 requiring completion by 3 pm on 23 March 2007. There was no attendance by or on behalf of Mr Sayer at the time and place specified for settlement under either of the notices to complete. 3 On 27 March 2007, H G & R Securities formally terminated the Contract, as it had indicated (a month earlier on 27 February 2007) it would do (Ex A p 264). 4 The property in question has since been resold for a lesser sum ($2,585,000 inclusive of GST). The deposit paid under the Contract (5% of the purchase price) has been paid into court by the second defendant, against whom no order is now sought. At the commencement of the proceedings I dismissed the proceedings against the second defendant by consent with no order as to costs. 5 H G & R Securities seeks damages by way of interest on the full purchase price for the time from 23 March 2007 to the date of resale of the property, and damages by reference to the difference in the resale price with interest on that amount from the date of judgment, together with the release of the deposit and any interest thereon. 6 In resisting the claim made by H G & R Securities, Mr Sayer has raised a number of issues. He seeks, among other things, declarations that H G & R Securities had no title to the property as at the date it terminated the Contract and that it wrongfully terminated the Contract. 7 Mr Sayer relies upon s 55(2A) of the Conveyancing Act 1919 and submits that H G & R Securities is not entitled to damages or to retain any deposit funds, citing Beynon v Wongala Holdings Pty Limited [1999] NSWSCA 66 at [32]. That sub-section gives the court jurisdiction, as noted in Beynon, to order the return of the deposit in cases where the contract was binding at law on the purchaser (and not simply where an order for specific performance of a contract would be refused). Issues 8 First, Mr Sayer disputes that H G & R Securities (which Mr Sayer accepts is the registered second mortgagee of the land in question) had title to the property (or, as seems to have been the thrust of the submissions put to me, was in a position validly to exercise a power of sale at the relevant time). This ground of defence is based on the alleged invalidity of the s 57(2)(b) notices on which H G & R Securities relied in order to exercise power of sale as mortgagee. It is said that the s 57(2)(b) notices were invalid in that they:

(i) overstated the amount outstanding pursuant to the mortgage to such an extent as to render the notices materially misleading and hence invalid ( Clarke v Japan Machines (Australia) Pty Limited [1984] 1 Qd R 404; National Westminster Finance Australia Limited v Jackson Giles J, 8 July 1988, unreported); and

(ii) neither brought to the attention of the mortgagor the particular default ( Segulin v Car Owners Mutual Insurance Co Limited (1984) NSW ConvR 55-191) nor brought to the attention of the mortgagor all that he was reasonably required to do to rectify the default ( Nemeth v Reachord Pty Limited (1998) 9 BPR 16,557). 9 Secondly, it is alleged that, prior to the issue of the respective notices to complete, there was a binding agreement between the parties for the rescission of the Contract; which agreement it is said was repudiated by H G & R Securities, precluding it from enforcing the Contract. 10 This ground of defence arises in the following circumstances. Prior to the issue of the first notice to complete, a request was made by the lawyers acting on behalf of Mr Sayer (Trinity Legal) for the Contract to be amended to reflect the fact that (apparently at the financier's insistence) the property was to be purchased in the name of MJS Holdings (Aust) Pty Limited ("MJS") as the trustee for The Sayer Trust (email dated 1 February 2007 - Ex A p 123). H G & R Securities appears to have had no objection in principle to that proposal (though seeking the costs of the preparation of the amended contract) on the basis that the amended contract "be simultaneously exchanged at settlement" (by which I understand that what was intended was a simultaneous exchange and completion of the amended contract at the time fixed for settlement) (Ex A p 124). The following day, what was proposed by the lawyers acting for H G & R Securities (Bransgroves) was a somewhat different course, namely that the Contract be rescinded and the parties "re-exchange" and simultaneously complete a new contract in the name of MJS (letter dated 2 February 2007 - Ex A p 140). Thereafter, rescission (rather than the amendment) of the Contract seems to have been the proposed course in the contemplation of both parties. As it transpired, however, the parties were unable to agree as to the terms of the deed by which the rescission was to be effected (in particular, as to whether Mr Sayer should be obliged to provide a personal guarantee of the obligations of MJS under the proposed replacement contract for sale of land) and the Contract was not formally rescinded. Mr Sayer relies upon this alleged agreement for rescission as invalidating any power of sale. 11 Thirdly, it is said that the relevant notice to complete (issued on 8 March 2007) was invalid (or could not, in equity, be relied upon) because:

(i) H G & R Securities was guilty of antecedent default, breach and/or delay in respect of the Contract (as a result of its failure to provide, at least seven days prior to completion, a tax invoice for GST purposes pursuant to Special Condition 44.3 of the Contract and its failure to respond to a requisition seeking the provision of cheque directions on settlement);

(ii) H G & R Securities lacks clean hands (on the basis that it had reneged on the alleged agreement to rescind the Contract);

(iii) Mr Sayer was not in breach or guilty of unreasonable delay in the circumstances;

(iv) the notice to complete was defective as to time (the time given not being reasonable in the circumstances) and as to form (not being addressed to Mr Sayer and not stating the amount due on completion); and/or

(v) H G & R Securities was not, at the time it issued the notice to complete, ready, willing and able to complete (by reason of its failure to provide a GST tax invoice; cheque payment directions; and to clear the land tax payable in respect of the property). 12 I address each of the above issues in turn.

1. Validity of power of sale 13 H G & R Securities was the registered second mortgagee pursuant to Mortgage AB 979922. That mortgage was stamped to the sum of $280,000. It was a second registered mortgage. There was a first mortgage over the property securing a loan of $2,190,000. The first registered mortgagee was H G & R Finance Limited, which, on or about 22 December 2005, changed its name to Balanced Securities Limited ("Balanced Securities"). There are common directors between the two mortgagee companies. 14 In evidence were copies of two facility agreements (which I admitted, subject to relevance, over objection): the first between Balanced Securities and the registered proprietor of the land (Ex B pp 33-69) and the second between the registered proprietor and H G & R Securities (Ex B pp; 70-106). Each permitted the assignment by the respective lender of all or any of its rights or obligations under the facility agreement and/or the relevant securities; and precluded the lender (or guarantors) from insisting on provision of notice in writing as a condition to any assignment, transfer or dealing. 15 Also in evidence, again admitted (subject to relevance) over objection, is a copy of a trust journal extract from the financial records of David Geer Lawyers (the solicitors who had apparently acted for both the first and second mortgagees in relation to their facilities), recording the payment out, by trust cheque on 31 August 2006 in the sum of $2,403,787.44, of the first mortgage by H G & R Securities (Ex B p 115). This is consistent with instructions given by Steven Hodges (as H G & R Securities' Senior Credit Manager) to Bransgroves by email on 31 August 2006 (Ex B p 118) and with a Westpac account transaction record for 1 September 2006 (Ex B p 120). 16 It was submitted by Counsel for H G & R Securities, Mr Young, that this material demonstrated that either Balanced Securities was paid out by H G & R Securities as second mortgagee (by way of redemption in defence of its security), and thus the sum of $2.4 million became owing under the first and second mortgages combined, or there was an equitable assignment to H G & R Securities of Balanced Securities' rights under its first registered mortgage. 17 It was submitted by Counsel for Mr Sayer, Ms Obrart, that H G & R Securities did not have the ability to convey title on 23 March 2007 as it had not notified the registered proprietor (before the issue of the s 57(2)(b) notices in late 2006) of the transfer of mortgage.

· Is it open to Mr Sayer to challenge the mortgagee's title? 18 Mr Young submits that it is not open to Mr Sayer to raise any issue as to the ability of H G & R Securities, as mortgagee in possession, to provide good title, having regard to Special Condition 36 of the Contract (in which Mr Sayer expressly acknowledged that this was a sale by the mortgagee and agreed not to make any objection in relation thereto) and s 58(2) of the Real Property Act 1900 (which makes it clear that a purchaser is not bound to inquire as to the mortgagee's title). 19 Special Condition 36, relevantly, provided as follows: SALE BY MORTGAGEE

36.1 The Purchaser acknowledges that he is aware that the Vendor sells the Property and exercises the power of sale conferred by mortgage number AB979922 from Mark Amos to the Vendor dated 8 December 2005 (the "Mortgage").

36.2 The Purchaser must not make any objection or requisition as to the subsistence of default under the Mortgage or as to the power of sale contained in the Mortgage and the assurance to be tendered under this Contract will be a Transfer under power of sale.

36.3 The Purchaser must not make any requisition, objection or claim for compensation, or claim any right to rescind or terminate in respect of the existence or manner of exercise of the Vendor's power of sale as mortgagee.

… 20 Section 58 of the Real Property Act, relevantly, provides as follows: 58 Power to sell (1) Where a mortgagee, chargee or covenant chargee is authorised by section 57 (2) to exercise the powers conferred by this section, the mortgagee, chargee or covenant chargee may sell the land mortgaged or charged, or any part thereof, and all the estate and interest therein of the mortgagor, charger or covenant charger, and either altogether or in lots by public auction or by private contract, or both such modes of sale, and subject to such conditions as the mortgagee, chargee or covenant chargee may think fit, and to buy in and resell the same without being liable for any loss occasioned thereby, and to make and execute all such instruments as shall be necessary for effecting the sale thereof, all which sales, contracts, matters, and things hereby authorised shall be as valid and effectual as if the mortgagor, charger or covenant charger had made, done, or executed the same, and the receipt or receipts in writing of the mortgagee, chargee or covenant chargee shall be a sufficient discharge to the purchaser of such land, estate, or interest, or of any portion thereof, for so much of the purchaser's purchase money as may be thereby expressed to be received.

(2) No such purchaser shall be answerable for the loss, misapplication, or non-application, or be obliged to see to the application of the purchase money by the purchaser paid, nor shall the purchaser be concerned to inquire as to the fact of any default or notice having been made or served as referred to in section 57 (2). … 21 Ms Obrart submits that Special Condition 36, on its proper construction, does not preclude the purchaser from invoking the invalidity of the power of sale to defend an action for damages by the vendor. 22 The difficulty I have with the construction of Special Condition 36 for which Ms Obrart contends (in effect, as I understand it, limiting special conditions 36.2 and 36.3 to the making of objections or requisitions on title) is that it makes a nonsense of the express prohibition, in Special Condition 36.3, on the purchaser claiming any "right to rescind or terminate in respect of the existence or manner of exercise of the Vendor's power of sale as mortgagee". There would be no point making provision to preclude the purchaser calling into question the vendor's title as mortgagee or the existence or manner in which the power of sale were to be exercised (as Special Condition 36 clearly does) if that were not intend to preclude the purchaser on completion from raising the very issue now sought to be raised by the purchaser (albeit in the context of a claim for damages where the purchaser, not having sought to rescind or terminate the contract in reliance on such an assertion, has failed to complete the Contract). 23 In other words, where the purchaser has agreed not to make any objection (or to claim any right to rescind or terminate) on the basis of a challenge to the mortgagee's title, its power of sale, or the exercise of the power of sale, and has failed to complete at a time which has been made of the essence, why should it be open to the purchaser now to raise complaints which it could not have raised at completion? Ms Obrart maintains that in this regard I should construe the Contract narrowly against the vendor. I see no reason to do so but, in any event, I think nothing turns on this for the reasons set out below. 24 While it was submitted by Ms Obrart that it is not unusual for a mortgagee in possession to be challenged as to its title, those challenges (as noted by Mr Young) are ordinarily in the context of a dispute between a mortgagor and mortgagee. Under the relevant provisions of the Real Property Act, as between mortgagor and purchaser, on the registration of a transfer by the mortgagee, the purchaser takes good title unless it has actual notice of a defect in the mortgagee's title. 25 Thus, even where the invalidity of a notice might have enabled a mortgagor to seek an injunction to restrain a sale, in circumstances where the mortgagor does not do so (and here there was no suggestion of any attempt by the mortgagor to restrain the sale to Mr Sayer, though he did seek, unsuccessfully, to restrain the later sale) the court is not precluded from ordering specific performance of a contract at the suit of a purchaser who entered into the contract without knowledge of the invalidity of the underlying s 57(2)(b) notice - Manton v Parabolic Pty Limited (1985) 2 NSWLR 361 at 377-378. If an order for specific performance lies at the suit of the purchaser in such a case then ordinarily the unperformed obligations of the mortgagee must at that time have been susceptible of specific enforcement (I C F Spry, Equitable Remedies, 6th Ed at p 91). 26 (I note, in passing, that the existence of some defect in the s 57(2)(b) notice (even one of which the purchaser is aware) does not of itself necessarily entitle the mortgagor to restrain a sale entered into by the mortgagee under its power of sale (see Emerald Securities Pty Limited v Tee Zed Enterprises Pty Limited (1981) 28 SASR 214).) 27 If, as I read Special Condition 36, it contains a contractual prohibition on the purchaser raising an objection or challenge to the mortgagee's title, and from claiming a right to rescind or terminate based on the alleged invalidity of exercise of the power of sale, what flows from that? 28 There is authority to suggest that a condition that a title for a certain period shall not be required, investigated, or objected to "is perfectly good, and can be enforced against a purchaser" (Kekewich J in Re Scott and Alvarez's Contracts; Scott v Alvarez [1895] 2 Ch 603, concurring with the conclusion as expressed by North J in In re National Provincial Bank of England v Marsh [1895] 1 Ch 190). Nevertheless, where the contract does not go so far as to oblige a purchaser "to accept such title as the vendor can give him, even though it turns out that the vendor has no title at all" (adopting the language of Kekewich J in Alvarez at 626), but rather precludes objections or requisitions being raised against title; and the purchaser on investigation subsequently establishes an actual defect in title, then (as in Alvarez), the court will not order specific performance of the contract by the purchaser. 29 This would lead me to conclude that, if Mr Sayer could establish that in March 2007 H G & R Securities there was a real doubt as to whether H G & R Securities was in fact able to confer good title, then an order for specific performance would not have lain against him at the suit of H G & R Securities, even though he had raised the lack of title in breach of Special Condition 36. Of course, that does not mean that a claim for damages could not now lie against him for breach of the covenant not to raise such an objection to title. In Valoutin Pty Limited & Anor v Furst & Ors (1998) 154 ALR 119, Finkelstein J accepted in principle that a vendor could recover damages for wrongful rescission of a contract of sale by the purchaser even though a court of equity would not have compelled the purchaser to accept a doubtful title (though in that case finding that there was no doubt as to title). Finkelstein J noted that in Alvarez the members of the Court of Appeal (determining a point arising in the proceedings prior to Kekewich J's subsequent decision) were of the view that the fact that the discretionary remedy of specific performance is refused does not affect the legal rights of the parties to the contract. 30 An interesting question might therefore have arisen in this case if H G & R Securities could establish that Mr Sayer was in breach of a contractual obligation not to raise objections as to the exercise of the power of sale, but nevertheless could not establish that it would have obtained an order for specific performance at that date. 31 I do not think it does arise in this case, as the evidence in my view establishes that H G & R Securities, as registered second mortgagee having redeemed or taken a transfer of the first mortgage debt, was in a position to exercise its power of sale and confer good title on the purchaser (at least absent any challenge by the mortgagor to such title or any actual defect in title of which the purchaser was on notice at or prior to completion).

· Circumstances in which H G & R Securities came to exercise power of sale 32 It does not appear to be in dispute that there was a monetary default by the registered proprietor under his mortgage to both the first and second mortgagee. (Though I note that there was evidence before me that in other proceedings before this Court there remains apparently a dispute between the former registered proprietor and H G & R Securities. In those proceedings the registered proprietor failed in an attempt (brought some time after the nominated completion date of 23 March 2007) to restrain the later sale of the property.) 33 Two s 57(2)(b) notices appear to have been served by H G & R Securities (being dated 13 October 2006 and 2 November 2006, respectively) (Ex B p 122 and p 133). Each stated that the principal due and remaining unpaid was $2,470,000. (An earlier s 57(2)(b) notice had been served by Balanced Securities in August 2006, limited to the amount of the first mortgage debt - Ex D.) 34 Formal notification of a transfer (on 31 August 2006) of Balanced Securities' mortgage debt to H G & R Securities (though erroneously asserting that this company was now known as Balanced Securities) was not given to the registered proprietor until the issue of a letter dated 28 February 2007 (Ex B pp 141/143). The incorrect reference to Balanced Securities (as being the company formerly known as H G & R Securities rather than, as was the case, the company formerly known as H G & R Finance Limited) was subsequently corrected by letter dated 8 March 2007 (Ex B p 146). On that day Notice of Transfer of Mortgage dated 8 March 2007 was also apparently served on the registered proprietor (by way of service to a firm of solicitors, A Luong and Associates) (Ex B p 145). 35 No copy of the Notice of Transfer was in evidence. There was no production by H G & R Securities of any transfer document in answer to a Notice to Produce served in these proceedings (Ex 1), nor had the solicitor from Bransgroves (Ms Kate Cooper), who gave evidence in the proceedings, seen any such document, (Bransgroves not having acted on the transfer of mortgage). There was, however, a copy of a statutory declaration by a process server (Ex B p 144) as to service of the said documents on 8 March 2007. I accept that, insofar as notice to the debtor was required to effect an equitable assignment of mortgage, as at 23 March 2007 this had occurred (though whether by a formal notice, as such, is not beyond doubt). 36 What seems to be suggested by Ms Obrart is that H G & R Securities had no power of sale if notification of the transfer of mortgages did not take place until 28 February 2007 (Ex B p 143) at the earliest, since that was after the s 57(2)(b) notices had been served (and, if that be relevant, also after the Contract was entered into (12 December 2006) and the first notice to complete had been issued requiring completion by 28 February 2007 at 3.00 pm). It was not until 1.40 pm on 28 February 2007 that the first letter notifying the transfer was sent by facsimile transmission. 37 However, even on that scenario, by the time ultimately fixed for completion (23 March 2007) not only had the s 57(2)(b) notices been served but there had also been notification (assuming that were necessary in light of the terms of the facility agreements) of the transfer of the first mortgage debt. Any challenge to the validity of the s 57(2)(b) notices could be raised by Mr Sayer only in the context of a challenge to the mortgagee's ability to make title on completion (which in my view, is precisely what Mr Sayer had contractually precluded himself (by Special Condition 36) from doing). 38 If I understand her submission correctly, Ms Obrart contends that the statutory requirements for the valid exercise of a power of sale must have been complied with before entry into the relevant contract for sale of land by the mortgagee (T 36), but it may be that she was referring instead to the time at which the notice to complete was issued. Reliance was placed on Carr v Finance Corporation of Australia (1982) 150 CLR 139 which held that a power of sale arising under contractual documents (or a statutory power of sale for that matter) cannot be exercised prior to compliance with s 57(2)(b). What Carr makes clear, however, is that the significance of a failure by the mortgagee to comply with the statutory notice requirements is that the mortgagee cannot exercise its power of sale, but the existence of a contractual power of sale is not itself dependent on such compliance. 39 It is not disputed by Mr Young that until default in compliance by the mortgagor with the requirements of a valid s 57(2)(b) notice, H G & R Securities, as mortgagee in possession, could not proceed to sell the mortgaged property. 40 However, it is clear that the vendor need not have good title when the contract of sale is made (Bell v Scott (1922) 30 CLR 387 at 392), provided that by the time for completion the vendor can confer good title on the purchaser, the principal obligation of the vendor being to convey an indefeasible title to the land on completion (Brickles v Snell [1916] 2 AC 599, as cited by Finkelstein J in Valoutin). Although in Valoutin his Honour went on to consider the circumstances in which a right of repudiation might be exercisable by a purchaser who discovers, prior to completion, that the vendor is neither able itself to convey nor to compel a conveyance by another to the purchaser (and whether, having exercised such a right of rescission, the purchaser might still be liable for damages if the vendor by the time for completion could make title), this issue does not arise here since no assertion as to lack of title was made by Mr Sayer prior to the date specified for completion (and to the extent that he treated the contract as subsisting over the period up to 23 March 2007, he may well have lost any right to repudiate - Halkett v Earl of Dudley [1907] 1 Ch 590; Bell v Scott). 41 Therefore, even if there was an issue as to lack of formal notification of the transfer of mortgage at any time prior to 28 February 2007, I do not accept that this would have precluded H G & R Securities either from validly entering into the Contract on 12 December 2006 or from issuing a notice to complete under that Contract as it did on 8 March 2007. (I consider later the effect, if any, of any invalidity as to form or substance of the s 57 (2)(b) notices on the issue of the relevant notice(s) to complete.) 42 Accordingly, to the extent that I have correctly understood this to be the way in which this first issue was raised by way of defence (and the basis of the claim for the declaration sought by paragraph 23C of the Further Amended Cross-Summons), namely as involving a challenge to the ability of the mortgagee in possession to convey title to the purchaser on completion, I am not satisfied that Mr Sayer has established that H G & R Securities did not have title as mortgagee or was not in a position to convey title as at either 23 March 2007 (the day fixed for completion by the 8 March notice to complete) or 27 March 2007 (the day of termination of the Contract). · Alleged invalidity of s 57(2)(b) notices 43 The second way in which this first issue seems to be raised (as per the first ground in Ms Obrart's written submissions) relates to whether the mortgagee had validly exercised, or was in a position validly to exercise, its power of sale. 44 The submission was put that as the mortgage had only been stamped to $280,000, the claimed mortgage debt of $2,470,000 was an overstatement of such scope as to render the notice invalid. 45 Although there are instances in which overstatement of the monetary default on which a s 57(2)(b) notice is based may invalidate the notice, these occur where the notice is materially misleading. 46 As a matter of fact, it does not appear that there was any actual overstatement in circumstances where the second mortgagee had redeemed or paid out the first mortgage and, whether or not it had taken a transfer or assignment of that mortgage debt, appears clearly to have been in a position to sue for the combined amount outstanding. However, was there a basis for the contention that the notice was misleading? 47 Ms Obrart submits that until the mortgagor received actual notification of the transfer of mortgage (which she says did not occur until 28 February 2007, at the earliest) a notice by H G & R Securities claiming an outstanding debt of some $2.4 million would have been materially misleading. 48 The fact that the borrower was aware, as at the date of the s 57(2)(b) notices, that the principal (which was said under the s 57(2)(b) notice to be due and unpaid) included both the first mortgage debt of $2,190,000 and the second mortgage debt of $280,000 must be apparent from the fact that a Statement of Claim (verified by Mr Hodges) was served with the first (13 October 2006) s 57(2)(b) notice. It contained a breakdown of the sums claimed and, in paragraph 11, the assertion that H G & R Securities had redeemed the first mortgage on or about 31 August 2006 (Ex B p 123-130 at 125). 49 Mr Young submits that in those circumstances there could have been nothing misleading to the mortgagor arising out of the issue of the notice claiming a debt of about $2.4 million at an earlier date. I agree. The mortgagor was on notice that defaults had been claimed on both his mortgages and that H G & R Securities was asserting an entitlement to enforce both mortgage debts. 50 The validity of the s 57(2)(b) notices was challenged on two further bases. 51 The first was as to form; namely that they did not bring to the attention of the mortgagor the particular default (because they did not specify the amount of interest owing); the second was that they did not bring to the attention of the mortgagor all that he was reasonably required to do to rectify the default. I do not accept either criticism. 52 The validity of a s 57(2)(b) notice is tested by reference to the purpose it serves, namely to give the mortgagor an opportunity to remedy the default or defaults which have occurred. It is thus necessary for the notice to identify the relevant default(s) (in which context Ms Obrart relies upon Segulin) and to specify what must be done to remedy the said default(s) (in which context Ms Obrart relies upon Nemeth). 53 In Segulin, Needham J, on an interlocutory basis, considered that the plaintiff had established a probability of success on the argument that a s 57(2)(b) notice requiring the payment of "principal and interest" in an amalgamated amount was invalid in that it did not identify "the amount of principal and the amount of interest". Here, the notice served on 13 October 2006 identified the default relied upon as the failure to pay "Principal due" of $2,190,000 (and legal costs for the issue of the notice including GST of $462.00). 54 That notice in its terms clearly specified the default relied upon as being the payment of principal. The fact that there may have been other defaults (say, payment of interest) is irrelevant if those were not relied upon for the purposes of the notice. 55 The second notice (2 November 2006) nominated an increased sum $2,470,000 (again said to be by way of principal due and remaining unpaid) plus legal costs and GST (again $462.00). 56 There can have been no doubt in the mind of the registered proprietor that the default relied upon was a failure to pay the principal sums owing in default of the registered second mortgage (which, from October 2006, the mortgagor was on notice extended to a default, in the principal owing on the first mortgage). 57 As to the second criticism, with respect it seems to me very clear what the mortgagor was required to do in order to remedy the default: namely, to pay the principal sum outstanding. This is not a case on fours with Nemeth, where the notice left unclear whether the mortgagor was required to remedy certain non-monetary defaults. 58 Accordingly, I consider that the s 57(2)(b) notices were valid and Mr Sayer's first ground of defence fails. 2. Alleged agreement to rescind 59 Ms Obrart contends that there was a binding agreement, constituted by the exchange of correspondence on 2 and 23 February 2007, for the rescission of the Contract, from which agreement H G & R Securities is said wrongfully to have resiled. 60 In response to this, Mr Young submits that:

(i) the 2 February 2007 letter was no more than an invitation to treat, ie a statement that H G & R Securities "would be prepared to rescind" and therefore not capable on acceptance of giving rise to a binding agreement;

(ii) the 2 February 2007 letter does not specify any time at which rescission should take place (the proposal was made by H G & R Securities that the Contract be rescinded at the time of sale and this was not acceptable to Mr Sayer who sought an immediate rescission);

(iii) the notice to complete issued on 13 February clearly operated to revoke any offer of rescission made on 2 February 2007;

(iv) in circumstances where completion of the Contract was already due, there should be implied, in any offer that was found to have been made on 2 February 2007, that it was only open for acceptance within a reasonable time and I should infer that any such reasonable time had expired so that the offer was no longer "on the table" by 23 February 2007. 61 It is further said in this regard that the estoppel case articulated in submissions by Ms Obrart (but not articulated in any way in the Cross-Summons) can be no better than the alleged contract. 62 As to (iii), Mr Young relies on Dickinson v Dodds [1876] 2 Ch 463 where it was held that an offer to sell property might be withdrawn at any time before acceptance without any formal notice to the offerees. There, a sale to another party was held to be an effective withdrawal of the offer. 63 Here, however, I do not regard the issue of the notice to complete (in the circumstances) as revoking or withdrawing any offer to proceed on completion by way of a sale to MJS. All that was being done, in my view, was to complete the formalities to make time of the essence for completion by Mr Sayer (or, if he wished to proceed with the simultaneous rescission/exchange, by MJS) on 23 March 2007. 64 As to (iv), while I accept that it might be implied in the offer that it was open for acceptance within a reasonable time, I am not satisfied that a reasonable time would necessarily have lapsed prior to the completion date. (If not accepted by then, however, then I consider any such offer would lapse and the vendor could require completion.) 65 Turning to (i) and (ii), the allegation that there was a binding agreement to rescind needs to be considered in the context of the events as they occurred. Although, these were summarised briefly earlier, it is necessary to consider them in further detail at this point. 66 There was some delay in the progress of the matter to completion, apparently due to delays caused by the election of the purchaser to have the margin scheme applied (for which a valuation of the property was required to be obtained by the purchaser). After a series of communications pressing for advice as to the progress of the valuation and when settlement could be anticipated (Ex A pp 111-113, 115, 116) Bransgroves advised on 30 January 2007 that in the absence of a satisfactory response a notice to complete would be issued (Ex A p 118). 67 Trinity Legal, in response, advised that their client would proceed with paying the full 10% GST (Ex A p 119). As noted above, the Contract named Mr Sayer as the purchaser and on 31 January 2007 Trinity Legal forwarded a proposed transfer naming him as transferee (Ex A pp 121/122). 68 On 1 February 2007, a request was made for the Contract to be amended to name MJS as the purchaser (Ex A p 123). While this could have been effected (pursuant to clause 4.3 of the Contract) simply by the tender of a transfer in MJS' name (provided it was accompanied by a signed direction from Mr Sayer), Bransgroves had no apparent difficulty with an amended contract being exchanged at settlement and requested an amended transfer (Ex A p 124). 69 On 2 February 2007, Trinity Legal, by email, wrote to Bransgroves, saying: As we stated, in the event that you prepare and submit a new Contract to us, we will require confirmation that the existing Contract is rescinded. Upon settlement , the new Contract can be exchanged/settled and the existing Contract rescinded. If this is suitable, please arrange to have the amended Contract forwarded to us as a matter of urgency. (my emphasis). 70 The words "in the event that" are conditional and not suggestive of any binding obligation at that stage. What is also clear is that at this stage Trinity Legal had in contemplation that (whether there be rescission and a new contract or simply an amended contract) the relevant formalities would be completed at the same time as settlement took place. 71 By response, Bransgroves wrote later by email on that same day: We advise that our client would be prepared to rescind the original contract on the following basis: 1. The parties re-exchange a new contract in the name of MJS Holdings (Aust) Pty Ltd ACN 123 246 364 as trustee for The Sayer Trust; 2. The settlement date remains the same, being 23 January 2007 (retrospective); 3. Interest for late settlement in accordance with clause 38 of the Special Conditions of the Contract, be paid from the date of settlement, 23 January 2007; 4. Land Tax be adjustable to the date of settlement, being 23 January 2007. 72 Item 4 is perhaps of some relevance, since Trinity Legal had previously advised (by facsimile transmission on 17 January 2007) (Ex A p 108) that their client would not agree to any adjustment for land tax and required a cleared land tax certificate prior to or on settlement (referring to clause 14.4.1 of the Contract) to which Bransgroves had responded (Ex A p 136) (without demur from Trinity Legal) that they would present a cheque in favour of the Office of State Revenue at settlement for the land tax. 73 On 2 February 2007, a new transfer naming MJS as purchaser was forwarded to Bransgroves (Ex A pp 145/146). It would seem, from the text of Trinity Legal's 2 February 2007 email (sent at 3:33 pm by Ms Elizabeth Aliperti), that the amended transfer was sent prior to receipt of the email from Bransgroves (which was apparently emailed by Ms Haleh Hamzavian at about 4.22 pm and faxed at 5.30 pm on that date - Ex A pp 141/142 respectively). 74 What followed next was the issue of the first notice to complete dated 13 February 2007 (Ex A p 150), (which Trinity Legal (after being pressed to acknowledge receipt) alleged was invalid as to substance and form, without deigning to provide any reasons or to respond to a request for particulars of that assertion) (Ex A p 156). 75 It was not until 23 February 2007 that Trinity Lawyers responded to the 2 February 2007 letter from Bransgroves which had set out the basis on which H G & R Securities was prepared to rescind the Contract, stating that: … our client agrees to the conditions noted therein to enable the rescission of existing Contracts. 76 Trinity Legal requested that a replacement contract be urgently forwarded and continued: Furthermore we confirm that the rescission of existing Contracts along with the simultaneous exchange of the replacement Contract will need to be effected immediately as we are instructed that our client's incoming mortgagee requires same to be effected prior to settlement. 77 Stopping there, all that the 2 February 2007 facsimile transmission, on its face, conveyed was a statement of the terms on which H G & R Securities "would be prepared to rescind". It was not, in my view, in terms an offer capable on acceptance of giving rise to a binding contract. It was no more than an invitation to treat. (If so, the issue of a notice to complete on 13 February 2007 could not be said in any way to amount to a repudiation of by H G & R Securities any agreement between the parties.) 78 Furthermore, the acceptance by Trinity Legal on 23 February 2007 of the conditions noted in that letter "to enable the rescission of existing Contracts", in effect added a new term (namely, the immediate rescission and simultaneous exchange - notwithstanding that Trinity Legal had earlier contemplated that rescission of the Contract and exchange/settlement of the new contract would take place on settlement). 79 Accordingly, even if the 2 February 2007 letter had contained an offer which was capable, on acceptance, of creating a binding agreement (which I do not believe it did) there was not any unconditional acceptance of such an offer on 23 February 2007 so as to give rise to any binding agreement on that date. 80 Since I do not think there was, as at 13 February, an "offer" as such which was capable of acceptance, the issue whether it was or should be taken to have been withdrawn by the issue of the notice to complete (as was submitted by Mr Young), or was subject to an implied term that it be accepted within a reasonable time (and, not having been accepted before then, was not still being on the table as at 23 February 2007) (as submitted in the alternative by Mr Young), does not arise. Had it been necessary to reach a conclusion on those issues, I have already indicated my views. 81 The 23 February 2007 letter, at best, constituted a counter offer capable of acceptance by Bransgroves' client. More likely it, too, was an invitation to treat (ie an indication of Mr Sayer's preparedness to accept the conditions outlined in earlier correspondence if Bransgroves' client would agree to an immediate rescission/exchange in advance of what both parties must have understood at that stage to be the nominated settlement date - 28 February 2007). 82 The submission of a Deed of Rescission and Exchange on 26 February 2007 by Bransgroves (including, as it did, a requirement that Mr Sayer provide a guarantee in respect of the obligations of MJS) is consistent with H G & R Securities having originally been prepared on settlement to accept a rescission of the Contract if accompanied by a simultaneous exchange and, now having been told that the rescission/exchange would have to take place prior to settlement, seeking to put in place a means by which it would be in the same position as it would have been under the previous rescission proposal (viz-a-viz personal liability of Mr Sayer for the settlement sum). 83 On 27 February 2007, Trinity Legal advised that their client was not agreeable to the guarantee/personal liability clauses of the deed which had been submitted and formally put Bransgroves on notice that … "our client will not be proceeding with any Rescission/Exchange [unless the guarantee/personal liability clauses of the Deed were deleted]". 84 It was, of course, open to Mr Sayer to take that stance. However, having done so, it is hardly for him to complain at the fact that H G & R Securities then chose to continue on the basis of the original (and still subsisting) Contract. The terms on which H G & R Securities had been prepared to effect a rescission/exchange had not been met. It had at that stage no obligation to proceed with the proposed rescission/exchange on settlement, let alone an obligation to proceed with an immediate rescission/exchange; nor was it in my view any way precluded from exercising its rights under the Contract and relying on any notice to complete which had earlier been validly issued. Nowhere is there an allegation that H G & R Securities was estopped from so doing, nor was there evidence before me to support such a finding. 85 At that stage (27 February 2007), H G & R Securities or its lawyers apparently became concerned that Mr Sayer may not have obtained finance and was simply seeking to avoid personal liability (see Bransgroves' letter of that date Ex A p 264). Bransgroves notified Trinity Legal that unless Mr Sayer agreed to the terms contained in the Deed, H G & R Securities would, pursuant to the Notice to Complete under the "old contract", seize the deposit and re-market the land. 86 However, the first notice to complete had incorrectly notified the address for completion. Although this was corrected at 1.40 pm on 28 February 2007, when there was no attendance for Mr Sayer at the re-notified place for settlement on 28 February 2007, H G & R Securities did not elect immediately to terminate the Contract. Trinity Legal were invited to explain why the vendor was not by then entitled to terminate (Ex a p 272). They again chose not to respond to that request (although on 5 March 2007 Trinity Legal did assert that finance could be obtained) (Ex A p 275). 87 The second notice to complete was issued on 8 March 2007, service being effected by delivery to the offices of Trinity Legal. No sworn affidavit of service was tendered, although a copy of a signed statutory declaration from a process server was tendered. 88 By letter dated 9 March 2007 (Ex A p 282) Bransgroves responded to the 5 March 2007 letter, confirming, in effect, their client's willingness to proceed by way of a sale to MJS if there was a bona fide intention to settle on the part of Bransgroves' client, and stating If your client is ready willing and able to settle and the incoming mortgagee is ready then why cannot we do a simultaneous exchange on settlement stating and that way our client will not require the protection of a guarantee by your client. [to whom they can there have been referring only to Mr Sayer] 89 Nothing further was heard. By letter dated 22 March 2007, Bransgroves reminded Trinity Legal that settlement was due to take place the next day and asking if they were going to attend (Ex A p 289). There was no response to that query nor (as was conceded) was there any attendance on behalf of Mr Sayer (or MJS) at settlement on 23 March 2007. 90 In determining whether communications between parties contributed to a binding contract, the court may interpret those communications by reference to the subject matter and surrounding circumstances, including stands of reasonable conduct in the known circumstances (McLelland J in Film Bars Pty Limited v Pacific Film Laboratories Pty Limited (1979) 1 BPR 9251). The commercial context in which the communications take place is normally of importance (Gleeson CJ in Australian Broadcasting Corporation v XIV Commonwealth Games (1988) 18 NSWLR 540 at 548). The subject matter or complexity of the transaction may in appropriate cases lead to an inference that the parties' common intention was not to be bound by an agreement until a formal G R Securities Pty Limited v Baulkham Hills Private Hospital Pty Limited (1986) 40 NSWLR 631. 91 Here the alleged agreement related to the manner in which proprietary interests were to be conveyed. Ordinarily, when dealing with such interests, one would expect a degree of formality in the documentation of the parties' agreement. Here, although what was contemplated was not particularly complex (and the same end result could have been achieved without any amendment/rescission of the Contract) the timing of the proposed rescission was a matter of some importance and was not the subject of any clear agreement between the parties. 92 In the circumstances I cannot ascertain any common intention of the parties immediately to be bound to the respective proposals contained in the 2 and 23 February correspondence. 93 I find that no binding agreement to rescind came into existence on 23 February 2007 and that the defence based on this allegation also fails. 3. Validity of notice to complete 94 There are five bases on which it is alleged that the 8 March 2007 notice to complete (on which H G & R Securities relies) was invalid:

(iii) lack of breach/unreasonable delay on the part of the purchaser,

(v) lack of readiness, willingness and ability to complete. 95 As to (ii), it was conceded that this ground of defence must fail if (as I have held is the case) no binding agreement came into existence on 23 February 2007, as it was predicated on there being a binding rescission agreement on which H G & R Securities reneged. Accordingly, I need not consider this issue other than to note, again, that the alleged agreement was not inconsistent with a requirement that completion take place on a completion date nominated in accordance with the Contract. I address the remaining bases of alleged invalidity as follows:

(i) alleged antecedent breach by vendor 96 Before a notice to complete can be validly given (in a case where the contract stipulates a completion date), not only must the intended recipient of the notice be in breach by failing to complete on the stipulated date, or guilty of unreasonable delay, but also the party giving the notice must be free of default, or breach or antecedent relevant delay (Mason J in Louinder v Leis (1982) 149 CLR 509 citing Neeta (Epping) Pty Limited v Phillips (1974) 131 CLR 286). This is the second of the requirements noted by Professor Butt in The Standard Contract for Sale of Land in New South Wales (2nd ed) for the issue of a valid notice to complete. 97 The submission by Ms Obrart in this regard was that a relevant delay by the vendor not need be taken as high as one which precluded the purchaser from completing. It was said that the vendor should not be allowed to put the purchaser to strict time limits if the vendor had itself been dilatory in responding to the purchaser's requests. It was also suggested that it created "at least a confusing position from the purchaser's point of view in the sense that does it mean that the vendor is ambivalent about settling the contract?" Ms Obrart suggested that H G & R Securities had (in the context of its response to the requisitions seeking information as to cheque directions) represented that something would be done prior to completion and, in those circumstances, the vendor should not be permitted to specify a time for completion (presumably until a reasonable time after it had provided that information). 98 The requirement that the giver must be free of relevant default was considered in Neeta and in Collingridge v Sontor (1997) 141 FLR 440. The nature of a breach which disentitles the issuer of notice to complete was said to be one which is relevant to or connected with the securing of completion (Neeta). In Collingridge v Sontor it was said that a party's breach disentitles that party from giving a notice to complete only where it goes to time or to completion. (So, for example, in Lindgren, Time in the Performance of Contracts (2nd ed) it is said that a party's breach will not preclude that party from giving a valid notice to complete where the breach has ceased to be of any operative effect in the progress towards completion or cannot reasonably be said to be the cause of the other party's failure to complete.) 99 Was there a "relevant default"? It is submitted that at the time of issue of the notice to complete H G & R Securities was guilty of default, breach and/or delay in respect of the original Contract such that it was disentitled from issuing a notice to complete, because of failure to comply with Special Condition 44.3 and clause 14.4. 100 Special Condition 44.3 provided that: 44.3 The Vendor must at least 7 days prior to settlement provide the Purchaser a tax invoice (or a copy of the tax invoice, the original of which must be handed over on settlement), in respect of the GST payable under the Contract.

101 Ms Cooper accepted in cross-examination that on her review of the conveyancing file held by Bransgroves she had seen no evidence of any GST invoice prepared prior to the specified settlement date. 102 Reference was made to Jillinda Pty Limited v McCourt [1983] NSW Conv R 55 145 where, on the true construction of the contract for sale in that case, McLelland J held that the purchaser's obligation to complete on a particular date was conditional on the vendor having furnished a certificate (pursuant to s 70(1)(c) of the Strata Titles Act 1973 (now repealed)) within not less than seven days before that date. The vendor was in default because it did not furnish the certificate until the day before completion and his Honour held that the vendor's delay in performance of that obligation remained relevant to the relative situations of the parties in respect of completion at the time when the notice to complete was given (two days after the date fixed for completion). His Honour concluded that the notice to complete was invalid both because there had been no relevant default by the purchaser (the condition to which the purchasers' obligation was subject not having been satisfied) and because the vendor's previous delay remained relevant to prevent the issue of a notice at that stage. 103 Here, the provision of a GST invoice was not something on which completion was expressly made conditional under the Contract. Nor is it likely in my view that the failure to provide such a notice prior to settlement would have caused or contributed to Mr Sayer being able to complete at the appointed time. I do not accept that it precluded the purchaser from assessing the GST payable and attending on settlement with a cheque for the requisite amount and (to the extent that this may be relevant) I note that Mr Sayer neither gave evidence himself nor adduced any other evidence to suggest it had impacted on his ability to settle. 104 I say, "to the extent that this may be relevant" because I accept that the onus is on H G & R Securities (the party asserting the validity of the notice to complete) to establish what is required for a valid notice to complete. However, where, as here, there is nothing to suggest that breach of a non-essential term (service of a GST invoice) would have impeded the purchaser's ability to settle, then the absence of evidence from the purchaser to suggest that it had done so reinforces my conclusion that this was not a relevant antecedent breach by the vendor. Trinity Legal were aware of the fact that on completion "the purchase price plus full 10% GST" would be payable and would have been capable of calculating that amount. I do not consider that the breach of clause 44.3 was an antecedent relevant breach precluding H G & R Securities from issuing a notice to complete on 8 March 2007. 105 The second basis on which it is said that there was an antecedent breach or delay was in the lack of a response to a requisition which had been made for the provision of cheque directions. Again, I cannot see that this in any way prevented the purchaser from attending settlement or delayed completion of the contract. 106 It is relevant to note that the requisition in question was not a requisition on title in the strict sense. (See C J Rossiter, Requisitions and Objections on Title: The time for delivery; the vendor's obligation to answer properly made requisitions; the purchaser's remedy for inadequate or erroneous answers (2000) 8 Australian Property Law Journal 1, in which the author noted that traditionally there were four senses in which the term requisition was commonly used, the fourth being "requisitions in the nature of general inquiries". Even in that fourth sense, the author noted the purchaser's entitlement as being to make inquiries as to matters pertaining to the property to be sold.) 107 A requisition seeking information as to how settlement cheques are to be drawn cannot be regarded as a requisition on title. It can only be a requisition, at its most general, in the fourth sense referred to by Associate Professor Rossiter. Even assuming that there was an obligation on the vendor to answer such a requisition in a timely fashion or at all, what flows from the failure of the vendor here to do so? 108 The response provided by letter dated 9 January 2007 (Ex A p 98) was that "Cheque directions will be provided in due course". No such directions were ever provided. In the absence of cheque directions, it would surely have been open to the purchaser to attend on settlement with a cheque made payable to the vendor for the balance of the purchase price (plus the GST payable). 109 Associate Professor Rossiter (in the context of requisitions in the nature of general enquiries about the property and improvements erected thereon) notes that (unlike the case of replies to requisitions on title in the strict sense) a failure properly to answer requisitions about the quality of the property where the purchaser has no legal ground to resist completion should in the usual event give rise simply to a liability to pay nominal damages (p 17). A fortiori, it is difficult to see how a failure to respond to a request for cheque directions in this case could have sounded in anything but the most nominal of damages. It surely cannot have given rise to the failure of Mr Sayer to complete. 110 It was suggested that a representation that cheque directions would be provided in due course might have caused delay or confusion of some kind. I have difficulty seeing how there could have been any confusion in this case from the purchaser's point of view as to the vendor's intention to settle the contract. H G & R Securities issued two notices to complete; before it did so there had been numerous enquiries as to the arrangements in relation to fixing a settlement date; the correspondence in relation to the proposed rescission of the Contract made it very clear at all times that H G & R Securities was not prepared to postpone the settlement date; by letter dated 27 February the intention of H G & R Securities to rely on the Contract (and to terminate and re-market the property if the purchaser failed to settle) was made clear; and, the day before settlement, there was correspondence putting the Trinity Legal firmly on notice of H G & R Securities' intention to press for completion on 23 March 2007. 111 I think it highly unlikely that, had Mr Sayer otherwise wanted (or been able) to complete the Contract, the lack of cheque directions (or the lack of GST invoice) would have caused him any real difficulty in completion. The deafening silence from his lawyers, when pressed time and again in relation to settlement (including on 22 February 2007 as to whether they intended to attend on settlement) and in relation to requests for information as to why (if it be the case) the vendor had not validly made time of the essence or could not insist upon completion, is redolent of a purchaser not wishing or able to complete; not of one being precluded by the vendor's conduct from so doing. 112 The breach or delay of which complaint was made was not delay in making good title, nor did it relate to the satisfaction by H G & R Securities of any condition to which the sale was subject. I do not regard the facts as establishing any relevant estoppel against H G & R Securities, as was suggested. Moreover, I note there was no evidence of any reliance on any such representation so as to make it unconscionable for the vendor to act inconsistently with or resile from any such representation (even had one been found to have been made). Accordingly, I find that there was no antecedent relevant breach or delay such as would preclude H G & R Securities giving a notice to complete on 8 March 2007.

(iii) Alleged lack of breach or unreasonable delay by Mr Sayer 113 It is a necessary requirement (and the first of those cited by Professor Butt) for a valid notice to complete to be issued on a purchaser that the purchaser was in breach or guilty of unreasonable delay - Crowe v Rindock Pty Ltd [2005] NSWSC 375 at [29]; Ng v Chong [2005] NSWSC 270 at [29], citing Neeta (Epping) Pty Ltd v Phillips (1972) 131 CLR at 286 at 299 as follows: In relation to such a notice given by a vendor to a purchaser the following questions must be answered: (i) was the purchaser in breach of any term of the contract or guilty of unreasonable delay? (ii) Was the vendor himself in default by breach of any term of the contract or guilty of any antecedent relevant delay? (iii) Was the time fixed a reasonable time in all the circumstances. 114 It is said that Mr Sayer was not in breach of the Contract, or guilty of unreasonable delay, as at 8 March 2007 and/or that, if he was, H G & R Securities was estopped from relying thereon. The claim based on estoppel was not articulated in the Cross-Summons. 115 As to the first matter, Mr Sayer was clearly in breach of the obligation to complete on 23 January 2007. Under the Contract, this, without more, entitled H G & R Securities to issue a notice to complete; and the parties were agreed that a 14 day period from the service of the notice was a proper and reasonable time for a notice to complete (Special Condition 37.1). 116 As to the second matter, the submission that Mr Sayer was not guilty of unreasonable delay seems to be based on an argument that, in circumstances where H G & R Securities did not object to the sale being completed by MJS and where the parties were corresponding as to how that might be achieved, the time period for a notice to complete should in effect be suspended in some fashion. I cannot see any basis for such an argument absent a claim based on estoppel and I do not accept that the material before me provides any basis for a claim based on estoppel. 117 Under the Contract, completion was due on 23 January 2007. Mr Sayer was on notice from the time of service of the first notice to complete (if not, indeed, before) that H G & R Securities was calling for completion to take place. As at the time of the service of the first notice to complete there had been no acceptance of any of the "conditions" which had been outlined in the 2 February 2007 letter as being the basis on which H G & R Securities would be prepared to rescind the Contract and enter into a new contract with MJS. 118 It must have been clear to Mr Sayer that H G & R Securities was relying on its rights under the Contract unless and until it was replaced with a contract signed by MJS and therefore that, unless rescinded, he was liable to complete in accordance with the Contract. 119 The estoppel raised in the oral submissions made during the hearing (though not pleaded) is said to arise from a representation contained in the 2 February 2007 letter that H G & R Securities would rescind the Contract. 120 There is in my view no inconsistency between the vendor pressing for completion on 23 March 2007, and the only representation which could reasonably be said to arise out of the 2 February correspondence (namely, that if certain conditions were satisfied H G & R Securities would be prepared to agree to a rescission of the Contract, those conditions including that there be a simultaneous exchange and settlement by MJS on the date already fixed for settlement ie no delay in settlement). The fact that H G & R Securities intended to rely on its rights under the Contract had been made very clear to Mr Sayer by the correspondence on 27 February 2007. 121 Further, Mr Sayer was on notice as at 9 March 2007 that H G & R Securities was still prepared to do what it had said, on 2 February 2007, it was prepared to do (see letter 9 March 2007); if there was a bona fide intention on Mr Sayer's part to settle. 122 In the circumstances, even if there was reliance by Mr Sayer on a representation contained in the 2 February correspondence (and there was no evidence of this - indeed, Mr Sayer chose not to give any evidence in the proceedings), there is nothing unconscionable in the vendor continuing to press for the completion of the Contract on 23 March 2007. H G & R Securities had affirmed its willingness to effect a simultaneous rescission/exchange and settlement on completion. I can only assume that, as between Mr Sayer and MJS, if MJS had been ready, willing and able to complete on 23 March 2007 then Mr Sayer would have been in a position to effect this.

(iv) alleged time/form defects · Time 123 It is the party who serves a notice to complete who bears the onus of proving that it gives a reasonable time for completion: Laurinda Pty Ltd v Capalaba Park Shopping Centre Pty Ltd [1989] HCA 23; (1989) 166 CLR 623 at 640, 647; and it has been held that in general (unless there are strong circumstances indicating otherwise,) 14 days will be the minimum period required for a notice to be reasonable: Laurinda at 623. 124 Reliance was placed on what was said by Young J (as his Honour then was) in Castle Hill Tyres v Luxspice Pty Limited 7 BPR 14, 959, namely, that if a notice to complete were to allow less than 14 days there must be some special matter that could be pointed to as to why that was reasonable. The adequacy of time of a notice to complete must depend on all the circumstances of the case. Especially one must remember the purpose of a notice to complete, that is, to limit the time beyond which Equity will no longer assist the party allegedly in default to obtain specific performance. 125 It was submitted by Ms Obrart that the 14 day period given in the circumstances of the present case was inadequate. It was conceded by Ms Obrart, somewhat cryptically, that the notice to complete in this case gave "at most" 14 clear days. 126 The reason it was said that here the time allowed was "at most" 14 days, was that the 14 clear days counted from the time of service of the notice on the purchaser's solicitors. It was said that I should not "deem" service to have been effected on that date. 127 However, there is no need to "deem" any particular date as the date of service in this case, since the evidence shows that the notice was delivered to the premises of Trinity Legal on 8 March 2007 and clause 20.6.3 of the Contract permitted service to be effected by way of service on a party's solicitor. 128 There was in evidence before me a copy of a statutory declaration as to service of the notice to complete. It was submitted that this was not the ordinary method of proving service; that ordinarily being done by way of a sworn affidavit. While that may be the case, it was open to Mr Sayer to lead evidence to dispute the fact of service had there been any real issue as to the receipt by Mr Sayer's solicitors of the notice to complete on 8 March 2007 (when the process server says in his statutory declaration he delivered it). No such evidence was given. 129 Ms Cooper, who did not have the conduct of the conveyancing transaction but has had the conduct of these proceedings, gave evidence that she had reviewed Bransgroves' conveyancing file in the matter and, as I understand it, the communications from the process server in question formed part of that file. 130 I do not consider there to be any serious dispute as to service of the notice to complete on Trinity Legal having been effected on 8 March 2007. Rather, issue was taken that Trinity Legal also acted for MJS and it was suggested that this might have been productive of some confusion (something I address below in relation to the issue raised as to defective form of the notice). 131 The fact that Trinity Legal also apparently acted for MJS is in my view quite irrelevant to the issue as to whether 14 days was a reasonable period of time to allow for completion. Trinity Legal acted for Mr Sayer. Service was effected on them. There is no reason to suggest that the notice would not have come to his attention as quickly in those circumstances as it would have done had Trinity Legal not also acted for MJS. 132 I was referred to the judgment of Burchett AJ in Van Minh Lam v Tuan Hung Nguyen [2003] NSWSC 119 where his Honour considered the law governing a party's entitlement to issue a notice to complete. His Honour noted that in Louinder, the High Court (unlike in the present case) was there concerned with a contract for the sale of land which did not fix a date for completion as distinct from a case where the contract stipulate the date for completion although without making time of the essence. In Van Minh Lam his Honour appears to have considered that, in circumstances where the contract specifically provided that a period of 14 days from the service of a notice would be a proper and reasonable time for completion, this would be seen as a reasonable period to allow, so long as the party was in fact justified in giving notice to complete. There, however, the party which had issued a notice to complete was not justified under the contract in so doing and was thrown back upon the rights available to it under the general law. Burchett AJ noted that: … if, as the Judges of the High Court considered in Sindel v Georgiou , the circumstances justifying the giving of a notice to complete may bear on the period which it is appropriate to allow, it seems to me to follow that, where the contract permits a particular length of notice, then that period must reciprocally be seen as capable, in a given case, of affecting the decision where the circumstances do justify the giving of such a notice. It is to be borne in mind that the same passage in the judgment in Sindel v Georgiou makes it clear that a clause in a contract to the effect that 14 days is to be deemed a reasonable time, is not the same thing as a requirement that a party giving a notice to complete must specify in it a period of 14 days, and no other period. 133 In Sindel v Georgiou (1984) 154 CLR 661, their Honours considered that the determination of what was a reasonable time for completion of a contract for sale of land, judged in the light and circumstances of the particular case, was "very much a matter of impression". 134 In Zaccardi v Caunt [2008] NSWCA 202, Campbell JA noted (at [87]) that in deciding what is a reasonable time to complete one must bear in mind the role that a notice to complete plays in the law concerning contracts, there outlining the different ways in which common law and equity courts had regarded contractual provisions concerning time in contracts before the fusion of administration of law and equity effected by the Judicature Act 1873 (Eng). His Honour noted that before the Judicature Act: Service of a Notice to Complete sought to bring about, by the time of termination, a situation in which an equity court would no longer regard it as unconscientious for a contracting party to insist on its strict contractual right to terminate. Thus, what counts as a valid Notice to Complete was judged by equity's standards. One requirement of a valid Notice to Complete is that it give a reasonable time for the recipient to carry out whatever step in the contractual process the Notice calls on the recipient to perform. What counts as "a reasonable time" , for the purpose of a Notice to Complete, is a time such that an equity court would not intervene to grant specific performance, or relief against forfeiture, if a Notice had been served and the time allowed by it had elapsed without the required action being taken. 135 His Honour noted that after the Judicature Act, the circumstances in which breach of a term (thenceforth regarded as intermediate) fixing the time for taking a step in the performance of a contract gives rise to a right to terminate were identical with those circumstances in which an equity court would not, before 1873, have intervened to grant relief; one of which being non compliance with a valid notice to complete. 136 In considering whether the time limited by a notice is reasonable, the court must consider all the circumstances of the case including (per Lord Parker of Waddington in Stickney v Keeble [1915] AC 386 at 419) not just what remains to be done at the date of the notice but other matters including whether a party "has continually been pressing for completion, or has before given similar notices which he has waived". 137 Those circumstances would also include the fact that (as here) the parties have already agreed that a 14 day period would be reasonable. 138 I have found that there was not any antecedent relevant delay or other conduct on the part of H G & R Securities which precluded it from issuing a notice to complete on 8 March 2007. 139 It was properly conceded by Ms Obrart that there was no evidence that Mr Sayer required more than 14 days in order to complete the Contract but it was submitted that an inference could be drawn that 14 days was not a reasonable time in the circumstances of this case because requisitions had not been answered and because this was a contract for a very large sum of money. The unanswered requisitions related solely to the drawing of cheques which could surely have been attended to within the 14 days allowed (and had there been any difficulty in that regard no doubt Mr Sayer could have raised this). As to the sums of money involved, had Mr Sayer considered more than 14 days would be necessary to attend to completion following service of an notice to complete, he could have sought a different time period to be specified in the agreement in the first place. In my view there is nothing to suggest that 14 days was not a reasonable time within which Mr Sayer could, had he so wished or been able to do so, have completed the Contract. 140 Accordingly, I am satisfied that the notice to complete allowed Mr Sayer a reasonable time to complete the Contract. · Form 141 As to the alleged defect in form, the notice to complete is not in its terms addressed to Mr Sayer, in the sense that it takes the form of a letter, on Bransgrove's letterhead, and is addressed as follows; Att: Elizabeth Aliperti Trinity Legal L 2 9-13 Argyle Street Parramatta NSW 2150

After the heading "NOTICE TO COMPLETE", the letter commences:

"Dear Madam". 142 Ms Obrart relies on the fact that it is not "addressed" to any specific person (including the defendant's solicitor) but is simply stated to be to the attention of Trinity Legal. Technically, it is addressed to Trinity Legal, and marked to the attention of Elizabeth Aliperti. 143 In my view to accept this submission would be a triumph of form over substance. The letter describes itself as a NOTICE TO COMPLETE; it identifies the matter as "Re: H G & R Securities Pty Ltd sale to Michael John Sayer"; it identifies the property by name and folio identifier numbers; and it goes on to say: As solicitors for (H G & R Securities) … on behalf of the vendor we give your client, Michael John Sayer, notice that … (my emphasis) 144 Point 2 of the notice then expressly requires "your client" (which can only, given the reference details in the introductory paragraph, be a reference to Mr Sayer) to complete the purchase and pay the balance of the purchase price. 145 It is submitted that it is a requirement of a notice to complete that the person required to complete be named as an addressee and that it is insufficient for the notice to be addressed to the purchaser's solicitor Ng v Chong. However, this is not a case where, as in Ng v Chong, there were a number of purchasers, one of whom was not addressed in the notice. Additional lack of clarity is said to have been created by the fact that Trinity Legal were apparently acting for MJS as well as Mr Sayer (although all the correspondence from Trinity Legal seems to have reference the matter back to Mr Sayer). 146 I cannot accept these submissions. The notice was in the form of a letter (but clearly headed Notice to Complete). While it was marked to the attention of a specified lawyer and addressed to Trinity Legal, its text makes it very clear that the party who was required to complete was "your client, Michael John Sayer". I do not accept that there was any confusion likely to have been engendered by this form of address nor did Mr Sayer give any evidence that he had suffered any confusion. Indeed, as noted above Mr Sayer gave no evidence at all as to his position. 147 Given that each of Trinity Legal, Mr Sayer and MJS must have well understood that as at 8 March 2007 no contract had been executed by MJS (and Mr Sayer had already notified H G & R Securities, via his lawyers of his refusal to entertain the idea of executing the Deed of Rescission provided to Trinity Legal), no one could have had the slightest doubt that this notice was requiring completion by Mr Sayer. 148 It is then said that the notice was defective in that it did not specify the amount due. It is clear that a notice to complete must state with reasonable explicitness what is required to be done: Fekala Pty Ltd v Castle Constructions Pty Ltd [2002] NSWCA 297 at [24]. However, there, this question was raised in circumstances where it was unclear whether the notice required a non-monetary default to be rectified. There can have been no such uncertainty in this case.

149 It is said that there was no communication by H G & R Securities as to the amount it considered to be owing on completion and, hence, that the scope for uncertainty concerning the interest payable on the Contract sum at completion rendered the notice to complete invalid for lack of specification of an amount. 150 Again, I do not accept this submission. Bransgroves had previously confirmed that interest for late settlement was to be charged in accordance with clause 38 of the Special Conditions of the Contract from the date of settlement, 23 January 2007 (Ex A pp 136 and see p 140 also). It might be a different matter if Mr Sayer had turned up to the settlement with a cheque based on incorrect interest calculations and H G & R Securities had then refused to accept it, but that did not occur here. (iv) Alleged lack of readiness, willingness and ability to complete 151 The third requirement for a valid notice to complete is that the vendor be ready, willing and able to complete at the time of issue of the notice Zaccardi v Caunt at [110]. This is a matter of fact. It is submitted by Ms Obrart that as at 8 March 2007 H G & R Securities was not ready, willing and able to complete. 152 This raises the issue of land tax. As noted earlier, Trinity Legal had made clear to Bransgroves that Mr Sayer did not agree to the adjustment of land tax (his consent being necessary as the Contract did not say that land tax was adjustable - clause 14.4) and that he required land tax clearance certificates to be provided on exchange. 153 While Trinity Legal appeared prepared to accept, as one of the conditions for rescission/exchange of contracts, that land tax be adjustable, I have found that there was no binding rescission agreement. Hence, H G & R Securities remained obliged on completion to provide title clear of any charge for land tax. There appears no dispute that neither at the time the notice to complete was issued nor, later, on the settlement date had any cleared land tax certificate(s) been obtained. 154 Does that mean that H G & R Securities was not in a position as at 8 March 2007 to issue a valid notice to complete? 155 Austin J comprehensively analysed the land tax provisions and their effect in a somewhat similar context in Wilde v Anstee (1999) 48 NSWLR 387. Reference was made by Austin J to the requirement that the giver of a notice to complete must be ready, willing and able to proceed to completion (as stated by Dankwerts J in Re Barr's Contract [1956] Ch 551 at 556). The link between this requirement and the traditional equity pleading in a suit for specific performance (noted by Campbell JA in Zaccardi v Caunt in the passage which I have earlier quoted) was referred to by Austin J, citing McNally v Waitzer [1981] 1 NSWLR 294 per Reynolds JA at 296 and Hutley JA at 303. 156 In McNally, it was recognised that the obligation on the Vendor to remove the charge for land tax (there arising under the Land Tax Management Act 1956 (NSW)) was an obligation which arose on completion. Hutley JA said (at 303-304): The vendor has to get rid of the charge for land tax, but only at the latest on completion and there is no objection to him giving a valid and effective notice to complete if at the time he gives it the property is still subject to land tax . … The correct rule, in my opinion, is simply that a vendor who is in default in respect of things which up until then should have been done cannot give a notice to complete, but he can give notice to complete prior to performing all those other things which he has to perform in order to complete the contract. The vendor does not have to satisfy the purchaser prior to completion that the land is not subject to a charge for land tax. He has, at the most on completion, to provide satisfactory evidence to the purchaser that either the land is not subject to land tax, or, if it is, that liability has been discharged in the course of completion itself. (my emphasis) 157 In Wilde v Anstee, Austin J considered whether the law required that before the notice to complete was served the vendor needed to put in place arrangements with the Office of Statement Revenue for the issue of a clear certificate on completion, or whether it was sufficient that those arrangements be made and notified to the purchaser in time for completion on the day on which the notice fixed for completion. Austin J considered that a notice to complete would be ineffective unless it was true (on the facts that existed at the time when the notice was given), that the vendor was able to make arrangements with the Office of State Revenue for the issue of the clear certificate and was ready, willing and able to do so. His Honour considered that perhaps notice would be effective if the evidence showed that the Office of State Revenue had adopted the practice of releasing land on payment of an estimated amount routinely or in normal circumstances and went on to say (at [54]): But where there is a real doubt at the time of service of the notice as to whether the Vendor is in a position to obtain the land tax clearance by the date for completion as stated in the notice, the Vendor is not able, ready and willing to proceed to completion and conversely the Purchaser cannot be said to have defaulted by not completing at the Contractual time for completion. 158 Here, there was evidence that Mr Sayer's solicitors had made enquiries of the Land Tax Office as to the clearance of the land tax and had obtained formal statements of the land tax charge for the 2007 year (Ex A pp 126-135), which were then forwarded to Bransgroves. 159 Bransgroves had notified of their intention at settlement to present a bank cheque in favour of the Office of State Revenue for clearance of the land tax in the sum of $23,340.55 (this having been the clearance amount advised by the Office of State Revenue) (Ex A pp 136/137). There was no objection to that proposed course of conduct. 160 There is evidence (in the form of correspondence from Bransgroves to Trinity Legal following the first unsuccessful settlement attempt) that a solicitor from Bransgroves had attended settlement armed with a bank cheque for the land tax. (Insofar as this be relevant, there was no dissent by Trinity Legal to the implicit proposition that the tender on settlement of a bank cheque for land tax would suffice.) 161 I would infer, from the fact that land tax assessments had already issued and that Bransgroves had asserted a willingness to tender a bank cheque for the said amounts, that as at the date the notice to complete was issued H G & R Securities was ready, willing and able to procure a clearance of the land tax on completion. There seems to have been no doubt as to the ability of the vendor to make arrangements for the clearance of land tax by completion; assessments had issued and Bransgroves had already liaised with the Land Titles Office in that regard. Certainly, there is nothing to cause me any real doubt (to use Austin J's words) at the time of service of the notice as to whether H G & R Securities would be in a position to obtain the land tax clearance by the date for completion as stated in the notice. 162 On that basis, the fact that there had been no actual clearance of the land tax as at 8 March 2007 does not invalidate the notice to complete which was served on 8 March 2007. 163 Accordingly, I find that the 8 March 2007 notice to complete was valid and that Mr Sayer was obliged to complete on 23 March 2007 with time then being of the essence.

Validity of Termination 164 I note that the Further Amended Cross-Summons seeks a declaration that the Contract was wrongfully terminated. No submissions were addressed to me on that issue per se. I therefore assume the position of Mr Sayer to be that the alleged wrongfulness of the termination of the Contract turns on whether the notice to complete had validly been issued (and hence whether Mr Sayer was in breach of an essential term by not completing on 8 March 2007). 165 It was not, as I understand it, suggested for Mr Sayer that, in the absence of a certificate available on the completion date that the land tax had been cleared or evidence as to arrangements for completion being such as to enable land tax to be cleared at settlement, H G & R Securities was not in a position to tender performance of its obligations when the time came for completion. However, in case that was intended to be raised by way of defence, I address that issue as follows. 166 There is no suggestion that H G & R Securities had obtained, prior to the time appointed for completion, or held at the time it terminated the Contract, cleared land tax certificates. In Dainford v Yulura (1984) NSW Conv R 55-184, Rath J held that, when land was subject to a land tax charge but the amount of tax had not been assessed, the purchaser was not required to accept at completion the vendor's undertaking to pay the land tax when assessed. (On appeal, the parties proceeded on an assumption that the vendor was obliged to have land tax removed as at settlement by payment of the assessed tax and, not having done so, was not able to settle.) However, here, the amount of tax had been assessed, so the difficulty faced in Dainford (or for that matter in McNally v Waitzer) does not arise. 167 Austin J made it clear in Wilde v Anstee that in his view the vendor's obligation to give good title on completion would be discharged if, on completion, the purchaser (and persons acquiring an interest under the purchaser) had the protection conferred by s 47(1c) by virtue of the issue at or prior to completion of a certificate that no land tax is charged on the land, procured by release and payment of an amount estimated by the Office of State Revenue. 168 Particularly in light of the correspondence on 17 January 2007, H G & R Securities could not, in my opinion, have relied upon an assumption that Mr Sayer would have accepted an undertaking on completion to clear the land tax (whatever may be the standard conveyancing practice in that regard). Absent any estoppel arising out of the communications prior to settlement, it would have been open to Mr Sayer to rely upon his strict legal rights to refuse such an undertaking. Whether he would have accepted a bank cheque for the land tax (even assuming one had been drawn for the purposes of the 23 March 2007 settlement, as it apparently was in anticipation of the 28 February settlement but as to which as at 23 March there was no evidence) is perhaps less clear. 169 However, if as seems to be the case no land tax clearance certificate(s) had been obtained prior to completion, does that mean that H G & R Securities was not able to tender performance on its part, so as to be in a position to terminate and claim damages for Mr Sayer's breach in failing to tender the purchase priced on completion? 170 Mr Young submits that I should treat Trinity Legal's letter of 27 February 2007 (Ex A p 264) as a repudiation of the Contract or an assertion that neither Mr Sayer nor MJS would complete unless or until H G & R Securities agreed to delete clauses 7 and 8 from the Deed. I do not consider that the correspondence goes so far as to establish a repudiation. Certainly, the letter contains a clear assertion that Mr Sayer would not execute a Deed of Rescission containing those clauses and would not be proceeding with any rescission/exchange but I do not read this as an assertion that Mr Sayer would not otherwise complete the Contract (particularly given that he could easily have done so without any rescission, by simply nominating MJS as the transferee). 171 I note, in this regard, that in Lohar Corporation Pty Ltd v Dibu Pty Ltd (1976) 1 BPR 9177 Hutley JA considered that there, where the appellant's solicitor had already received notice that there was to be no settlement (because the respondent had not obtained the money to settle) the appellant was justified "in not going through the laborious and expensive processes involved in an abortive settlement". There, however, there seemed to have been a more definitive statement of inability to complete than here where the Trinity Legal had simply failed to respond to a request to confirm whether they would attend upon settlement. 172 In Foran v Wight (1989) 168 CLR 385, the High Court considered whether a notice of rescission which had been given by the purchasers under a contract for the sale of land was invalid on the ground that the purchasers were not ready and willing to complete on the due date for want of funds. It was noted that the obligations of the vendor and purchaser on completion were mutually dependent and concurrent obligations (in the absence of any contrary stipulation) and that the primary rule was that neither party who fails to perform his obligation when the time for performance arrives can rescind for the other party's failure at that time to perform his obligation. 173 Deane J noted that in the ordinary case of a contract for sale of land: Neither vendor nor purchaser will be guilty of breach of contract if he fails to complete within the time or upon the day fixed in the contract unless the other party tenders performance of his concurrent obligations. 174 Brennan J stated, in the context of considering for a damages claim what was required to be established in terms of readiness, willingness and ability to perform: A breach by A of an essential term of the contract entitles B to rescind the contract and recover damages for the loss of the benefit of which, had the contract been performed, he would have been entitled. Whether the breach be anticipatory or actual, it is necessary to form an estimate of what would have happened had the contract been performed in comparison with what has happened, the contract being broken: see Hochster v De La Tour [1853] 2 EL & BL 678 at 691. Where B, being otherwise ready and willing to perform his part of mutually dependent and concurrent obligations , acts on A's intimation of non-performance and does not tender performance of his own obligation, his is entitled to damages for A's non-performance. In assessing the damages, it is necessary to form an estimate of the benefit to which B would have been entitled had performed his contractual obligation. (my emphasis) 175 In other words, in order to terminate a contract for sale of land in reliance on a breach of an essential term (as was the case here), the party so terminating must be in a position to tender performance and, if it does, then the relevance of that party establishing (on the balance of probabilities) its readiness and willingness to complete is as to whether that party can establish damages by reference to the position that party would have been in had there been no breach of that essential term. 176 If a party in the position of H G & R Securities, as vendor, terminating for what on this case is a clear breach of an essential term, is not in a position to prove that (had the purchaser not breached its obligation to attend at completion and pay the purchase price) it would have been able to perform its concurrent obligation to transfer title, then the party terminating the contract would not be in a position to claim damages (although it would appear that the party would be in a position to recover the deposit). Brennan J drew a distinction between readiness and willingness up to the time of an intimation of non-performance and readiness and willingness when the time for performance arrives (at p 431). Readiness and willingness to pay the price when the time for completion arrives was seen by his Honour as a condition precedent for the recovery of substantial damages but not essential to establish that a vendor, who had given an intimation of non-performance and failed to perform, was in breach. 177 In Foran v Wight the question of assessment of damages did not arise as the purchasers, having purported to rescind for the vendors' breach, sought merely to recover the deposit. Brennan J noted that: The finding, albeit obiter , of Needham J that the purchasers had not discharged the onus of proving readiness to complete seems to relate to the likelihood of the purchasers' having in hand on 22 June the finance needed to settle. That question does not fall for determination. Had the purchasers sought to recover substantial damages from the vendors for the vendors' failure to complete on 22 June, the purchasers' inability to prove, on the balance of probabilities, that they would have been able to pay the price on that day would have been fatal to the claim. But the purchasers abandoned a claim for damages for the vendors' breach. 178 In circumstances where his Honour considered that it could not be found that the purchasers were substantially incapable of raising the finance needed to complete at the time the vendors' solicitor intimated that completion would not take place, and had acted upon that intimation to suspend arrangements with the finance company which was to provide the major part of the finance, his Honour considered that the inference was that the purchasers had acted on the intimation and were up to the time when the intimation was given, ready and willing to complete. In those circumstances, the vendors' failure to complete on 22 June was a breach of contract which entitled the purchasers to rescind. Upon rescission of the contract, the consideration for which the purchasers had paid the deposit failed totally and Brennan J considered that the purchaser became entitled to recover the deposit not as damages but in quasi contract as money paid for a consideration that totally failed (citing Fibrosa Spolka Akcyjna v Fairbairn Lawson Combe Barbour Ltd [1943] AC 32) and noting that the purchasers' claim for the deposit was not founded on the contract which they had rescinded. 179 Failure to complete within a stipulated time, where time is of the essence, clearly constitutes an actual breach of the contract entitling the other party to terminate at least where that party is in a position to tender performance of its concurrent obligations under the contract. 180 Here, there is an argument that Mr Sayer had intimated that he would not attend on settlement (by his solicitor's letter of 27 February 2007, and their failure to confirm arrangements to do so) and therefore that H G & R Securities did not need to put itself in a position to tender performance. However, I do not consider that in the present case there was an unequivocal or unqualified intimation that Mr Sayer would not complete the Contract on the date fixed for completion, even though I think the likely inference from the failure of Trinity Legal to respond to Bransgroves' enquiry on 22 February 2007 is that Mr Sayer did not intend to do so. 181 Nevertheless, there is evidence that H G & R Securities was in a position to tender performance on the date nominated for completion and attended at the time and place nominated for settlement ready to do so. There was (admitted over objection in the absence of the solicitor in question) an email or electronic file note of attendance by a solicitor, Ms Haleh Hamzavian, at the time and place specified for settlement (Ex A p 269, 292). The evidence by Ms Cooper, also of Bransgroves, was that this email attendance note was in accordance with the ordinary practice within Bransgroves for solicitors recording (electronically) attendances on conveyancing matters. This email is consistent with other similar attendance notes exhibited in the proceedings. 182 I gave leave to H G & R Securities to read an affidavit of Ms Hamzavian, notwithstanding that Ms Hamzavian was unavailable for cross-examination, on the basis that Ms Hamzavian's affidavit, other than in paragraph 15, largely dealt with documentary evidence and it seemed to me that in assessing paragraph 15 this would a question of weight given the absence of the ability for her to be cross-examined by Mr Sayer's Counsel. There was a minor discrepancy between paragraph 15 of the affidavit and Ms Hamzavian's electronic file note of attendance (Ex A p 292); there being a ten minute discrepancy in the time frame noted. The electronic file note was in the same form as attendance notices that had been posted in relation to the first date scheduled for settlement both from Ms Hamzavian and another solicitor who attended at a separate address for the first 28 February 2007 settlement. Given that Ms Hamzavian was not cross-examined, I would rely on the contemporaneous written record of her attendance in preference to her affidavit and do not place any weight in this regard on paragraph 15 of the affidavit. 183 There was evidence to suggest that Ms Hamzavian had attended on the earlier date specified for completion in February 2007 with a bank cheque payable for the land tax. There is nothing to suggest Ms Hamzavian did not similarly attend settlement on 8 March 2007 with, among other things, the necessary documents in order to convey title to the purchaser (including, consistent with what according to her earlier file note had occurred on 28 February 2007, a bank cheque for settlement of the land tax) and would, had the purchaser been entitled to insist thereon at the time fixed for completion, have been in a position to obtain a land tax clearance certificate on presentation of a bank cheque for the assessed amount. However, there is no direct evidence of this. Ms Obrart submits, and I accept, that it is for H G & R Securities to establish its loss. It is required to do so on the balance of probabilities. 184 I consider that on the balance of probabilities, H G & R Securities, has established, first, that there was an attendance on its behalf on the completion date for the purposes of tendering performance of the vendor's obligations under the contract and, secondly, that it would have been in a position to complete on 23 March 2007 (the land tax being capable of clearance by the simple procedure of tendering a bank cheque on settlement or at the Land Titles Office). The fact that Mr Sayer chose not to attend on settlement means that the purchaser did not, in effect, put the vendor to the test (unlike the situation which occurred in Fekala v Castle Constructions where the purchaser did so and the vendor was in fact unable to complete). 185 Significant in this regard is that this is not a case where land tax had not already been assessed. It had been assessed and the Land Tax Office had indicated what was required for the land tax to be cleared. There is no suggestion that H G & R Securities would not have been financially in a position to clear the land tax on completion. 186 By contrast, in Wilde v Anstee, where the issue was whether there was readiness and willingness to complete as at the time of issue of the notice to complete, no steps had been taken to ascertain the land tax to be paid and, according to his Honour, it seems there was real doubt as to the ability of the vendors to arrange for clearance of the land tax certificate at the time the notice to complete was issued. 187 In McNally v Waitzer, on the other hand, where the land tax assessment had been issued before the notice to complete was served (and therefore, at the time of service of the notice, the vendor was in a position to remove the land tax charge simply by payment of the assessed amount), Hutley JA noted that the vendor did not have to satisfy the purchaser prior to completion that the land was not subject to a charge for land tax "he has, at the most on completion, to present satisfactory evidence to the purchaser that either the land is not subject to land tax or, if it is, that liability has been discharged in the course of completion itself." His Honour there drew an analogy with the practice on discharge of mortgages. In those circumstances, in Wilde v Anstee, Austin J accepted that the analogy drawn with the discharge of the mortgage would be a close one. Approaching the issue in that way, his Honour reconciled the apparent point of difference between the Court of Appeal in McNally v Waitzer and McLelland J's comments in Jillinda. His Honour read Hutley JA's remarks in the Court of Appeal as proceeding on a factual assumption that there would be no obstacle to the vendor freeing the land from the land tax charge on or prior to completion and went on to say: "this is clearly so if land tax has been assessed before the notice is served, and it is also the case if land tax is assessed after the service of the notice but before the date fixed for completion. It is also true, in the absence of a relevant assessment, if it is clear that at the time of service of the notice the Office of State Revenue will release the land upon payment of an estimated amount out of the settlement moneys." 188 Austin J considered that the court could have regard to the practical circumstances of the case. His Honour accepted that a vendor who had first made proper arrangements with the Office of State Revenue could proceed to issue a notice to complete requiring completion before a land tax assessment was available. I have already found in this regard that it was open to the vendor here (H G & R Securities) to issue the notice to complete when it did, arrangements having already been made as to the amount for which the land tax could be cleared. 189 I note that in Zaccardi, Campbell JA, albeit again in the context of assessing the validity of a notice to complete, appeared to have been prepared (notwithstanding the absence of evidence of steps taken to obtain discharge of the mortgage) to infer that the vendors were ready and willing to complete on the day the notice was issued and would be ready, willing and able to complete at the time called for by the notice, having regard to "the rudimentary tasks that vendors under a contract for sale of Torrens title land are called on to perform (even when they need to arrange discharge of a mortgage), and the prompt service of the purported Notice to Complete". Here the preparation of a GST invoice, even if (which I doubt) essential for completion, was clearly a rudimentary step and the arrangements for clearance of land tax (likened in McNally to discharge of a mortgage) had earlier been put in train. 190 In the circumstances, having regard to the evidence of the land tax assessments, I am satisfied that the land tax charges would have been able to be cleared by H G & R Securities tendering the assessed amount prior to or in the course of completion. (Similarly, had Mr Sayer on completion insisted on provision of a GST invoice it would have been a simple matter to provide one - if necessary by preparing one during the course of completion.) 191 Accordingly, had this been a separate ground on which the claim by H G & R Securities was resisted, I would have held that it failed. Damages claimed 192 H G & R Securities claims:

(a) release of the $126,500 plus any interest thereon;

(b) damages in the sum of $274,385.84 (being $400,635.84 less $126,500);

(c) interest on $400,635.84 since 15 December 2007 at Supreme Court rates less any interest under (a). 193 As to damages, Ms Obrart submitted that if it is found that the plaintiff is entitled to recover from the defendant any damages, deposit funds are required to be set off against those damages (Buchanan v Dunstan [2007] NSWSC 248, per White J at [48], [69]). This is conceded by H G & R Securities. 194 The resale contract price was $175,000 lower than the price under the Contract in GST exclusive terms and the completion date fixed under the resale contract was 15 December 2007. 195 Effectively what is sought is the difference in the resale amount (less the amount already paid into court being the 5% deposit of $126,250) and the release of that 5% deposit, plus interest on loss of use of the moneys for the whole of the purchase price over the period from 23 January 2007 to the date of the resale. 196 In an affidavit sworn by Mr Hodges, the credit manager of H G & R Securities, the interest lost was calculated as being $225,635.84 (at a rate of 10% which is less than the 12% interest rate provided in Special Condition 38 of the Sale Contract in the event of late completion). Added to the $175,000 resale deficit, the loss claimed is therefore $400,635.84. Mr Hodges was not cross-examined on this affidavit (though he had been required to be made available for cross-examination). I accept his evidence as to the interest calculations. Conclusion 197 I find that the Contract was validly terminated by H G & R Securities and that it is entitled to the relief it has claimed. I propose to make orders as follows:

1. I declare that the plaintiff has effectively terminated the Contract for Sale of Land dated 12 December 2006 between the plaintiff the first defendant.

2. I declare that the plaintiff is entitled to the release to it of the sum of $126,250 held as to the deposit under the said Contract, which has been paid into Court, and any interest accrued thereon to the date of payment out to the plaintiff.

3. I order the first defendant to pay damages for breach of the Contract in the sum of $274,385.84.

4. I order the first defendant to pay interest on the sum of $400,635.84 calculated at Supreme Court rates from 15 December 2007 to the date of payment (less any interest paid under order 2). 198 I will hear the parties as to costs. **********

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