Morrow v Tucker

PARTIES : Carmen Lee Morrow (Plaintiff) May Tucker (Defendant)

COUNSEL : Mr A C Casselden (P) Mr J M Miller (D)

SOLICITORS : Baker Love inc Rutter Morgan (P) Swaab Attorneys (D)

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

1991/06 CARMEN LEE MORROW v MAY TUCKER JUDGMENT 1 HIS HONOUR: There is before me a separate procedural question whether the relief sought by the plaintiff pursuant to a notice of motion filed on 19 October 2006 is relief which can be obtained in these proceedings or requires the bringing of a new action.

2 The background is that the defendant as vendor entered into a contract dated 6 December 2005 with the plaintiff as purchaser for the sale of land. The plaintiff commenced these proceedings for specific performance. On 26 July 2006, after a contested hearing, Palmer J made the following declaration and orders:

1. A declaration that the agreement made on or about 6 December 2005 between the Plaintiff and the Defendant ought to be specifically performed and carried into execution.
2. An order that the Defendant specifically perform and carry into execution the said agreement so far as the same remains to be performed.
3. The Defendant is ordered to pay the Plaintiff's costs.
4. Grant liberty to the parties to apply on seven days' notice.

3 The plaintiff's notice of motion filed on 19 October 2006 in the same proceedings seeks the following orders or directions:

1. The defendant execute all such instruments and do all such things as are necessary in order to specifically perform the said agreement in compliance with Justice Palmer's order of 26 July 2006.
2. For the purposes of giving effect to Order 1: (a) the defendant is to attend the office of the Registrar in Equity, Supreme Court, Queens Square at on October 2006 and to execute a Transfer in registrable form by the defendant as transferor to the plaintiff as transferee of the land known as 16 Rookes Road, Salt Ash in the State of New South Wales contained in Certificate of Title Folio Identifier 4/228207; (b) the defendant is to bring with her to the said appointment the title documents for the said land; (c) the plaintiff is to attend the said appointment and to bring with her a bank cheque in the sum of $296,668.58 payable to the defendant, May Tucker being the sum specified in the Settlement Adjustment Schedule annexed hereto as the balance due on completion, and an authority for Swaab Attorneys as stakeholder to account to the defendant for the deposit held by them; (d) the Transfer when executed is to be handed to the plaintiff together with the title documents for the said land in exchange for which the defendant is to be handed the bank cheque for the sum of $296,668.58 and the authority for Swaab Attorneys to account to her for the deposit; (e) if the defendant fails to attend the said appointment or fails to execute any necessary document or to take any necessary step to give effect to Order 1, the Registrar in Equity shall be empowered pursuant to s 94 Uniform Civil Procedure Act 2005 (NSW) to so act in her place; (f) in the event of settlement taking place in accordance with sub-paragraph (e) of these orders, the plaintiff is to pay the sum specified in the Settlement Adjustment Schedule annexed hereto into Court and to deliver to the Registrar in Equity an authority for Swaab Attorneys to account to the Registrar for the deposit held by them; (g) any amount paid into Court pursuant to sub-paragraph (f) of these orders, to be paid out to the defendant upon application to the Court subject to any further orders which the Court may make upon such application being made.
3. The plaintiff's caveat number AC95660 be withdrawn as and from the date of settlement.
4. The defendant to pay the plaintiff's costs.
5. Each party to be at liberty to apply for further directions on giving 7 days notice to the other party.

4 Orders along the lines of those sought in paragraph 1 of the notice of motion were sought in the plaintiff's statement of claim, but were not made by Palmer J.

5 The parties acquainted me with the issues that they would wish to raise at a substantive hearing of the notice of motion. Subsequent to the specific performance decree, the plaintiff did not complete the sale in accordance with notices to complete served by the defendant. The defendant gave notice of termination of the contract. The plaintiff would wish to argue that the completion and termination notices were ineffective because once the specific performance decree was made, the matter came under the control of the Court and the defendant had to apply to the Court for leave to serve such notices or to terminate the contract. The plaintiff says that she did not complete in accordance with the notices to complete because she encountered unexpected difficulty in obtaining finance, but she is now ready, willing and able to complete; and that in the circumstances the Court should make the orders sought in the notice of motion. At a substantive hearing the defendant would wish to argue that she validly terminated the contract pursuant to a contractual right to do so; or that, in the events that have happened, the orders sought by the plaintiff should not be made, whether sought in the notice of motion or in fresh proceedings at a substantive hearing.

6 The substantive issues are not before me for resolution. The only matter before me for determination concerns the procedure that should be followed where the Court has granted an order for specific performance and subsequent relief is sought in circumstances where the contract has not been completed. It is a purely procedural question. The plaintiff submits that her notice of motion, filed in the original specific performance proceedings, is an appropriate vehicle for the relief which she seeks, pursuant to the liberty to apply granted by Palmer J. The defendant submits that the plaintiff must seek such relief in fresh proceedings.

7 The specific performance decree in the present case did not include any directions as to implementation of the general order for specific performance against the defendant (order 2). Precedents of orders for specific performance in Nevill and Ashe Equity Proceedings With Precedents (NSW) pp 256-257 include a "simple" form of order for performance by a vendor which is not dissimilar to the order made in the present case; a "general" form of order for performance by a purchaser which includes directions for the time and place of, and amount to be paid on, completion; and a "complex" form of order for performance by a vendor which includes detailed directions.

8 A helpful summary of the relevant procedural and substantive principles is found in Fry on Specific Performance (6th ed, 1921) at 546 - 547. That summary supports use of the notice of motion procedure in circumstances where relief is sought following a judgment for specific performance and the contract has not been completed: 1170 . It may and not unfrequently does happen that after judgment has been given for the specific performance of a contract, some further relief becomes necessary, in consequence of one or other of the parties making default in the performance of something which ought under the judgment to be performed by him or on his part; as, for instance, where a vendor refuses or is unable to execute a proper conveyance of the property, or a purchaser to pay the purchase-money. The character of the consequential relief appropriate to any particular case will of course vary according to the nature of the subject-matter of the contract and the position which the applicant occupies in the transaction; but in every case the application must, under the present practice, be made only to the Court by which the judgment was pronounced, and the multiplicity of legal proceedings which sometimes occurred before the fusion of the jurisdictions of the Courts of Chancery and Common Law is now practically impossible. 1171. There are two kinds of relief after judgment for specific performance of which either party to the contract may, in a proper case, avail himself. 1172. (i.) He may obtain ( on motion in the action ) an order appointing a definite time and place for the completion of the contract by payment of the unpaid purchase-money and delivery over of the executed conveyance and title-deeds, or a period within which the judgment is to be obeyed, and, if the other party fails to obey the order, may thereupon at once issue a writ of sequestration against the defaulting party's estate and effects… 1173. (ii.) He may apply to the Court ( by motion in the action ) for an order rescinding the contract. On an application of this kind, if it appears that the party moved against has positively refused to complete the contract, its immediate rescission may be ordered: otherwise, the order will be for rescission in default of completion within a limited time. (emphasis added)

9 The notice of motion procedure is also supported in the following discussion in Jones and Goodhart on Specific Performance (2nd ed, 1996) at pp 256-257: If the defendant fails to comply with the order for completion, the plaintiff cannot immediately proceed to execution (see Palmer v Lark [1945] Ch 182 at 184) but must first apply for a further order directing the defendant to complete (see Morgan v Brisco (1886) 32 ChD 192. The application may be made by summons or motion ; for precedents see 37 Court Forms (2nd edn) (1995) issue pp 123-24, Forms 92,93). In a purchaser's action, the order will normally direct the vendor to execute and deliver to the plaintiff the conveyance or other instrument and to deliver all documents of title to which the plaintiff is entitled as purchaser upon lodgement in court by the plaintiff of the balance of the purchase price (for procedure on lodgement of funds in court, see the Court Funds Rules 1987, SI 1987/82). In a vendor's action, the order will normally direct the purchaser to pay to the plaintiff the certified balance of the purchase price, together with any further interest accruing, on deposit by the plaintiff in court of the executed conveyance or other instrument and all documents of title to which the purchaser is entitled.

The order should specify the time within which the defendant must comply… (emphasis added)

It was also said at 258 - 259 (omitting citations): Alternative relief after judgment A plaintiff who has obtained an uncompleted order for specific performance may be unable to enforce the order or may no longer wish to do so. This may happen, for example, in a purchaser's action if the vendor's title is shown on the inquiry as to title to be subject to a defect which the plaintiff is unwilling to waive; or if it becomes apparent that it will be impossible or not reasonably practicable to enforce the order against the defendant.

But the plaintiff (whether vendor or purchaser) is not entitled to put an end to the contract himself by treating the defendant's continued non-performance as a repudiation of the contract and accepting the repudiation; he must apply to the court for an order discharging the contract. Although the contract continues to exist and is not merged in the order, it is the provisions of the order and not of the contract which regulate the working out or cancellation of the contract. Thus, after an order for specific performance has been made, the contract becomes due for completion at the time directed by the court and neither party can serve a completion notice purporting to make time of the essence, even if the conditions of sale applicable to the contract provide for such a notice. A plaintiff vendor who re-sells the property to a third party without first obtaining the discharge of the order is not entitled to damages for breach of the original contract or to retain the deposit paid under it.

The court will make an order for the discharge of the contract unless it would be unconscionable for the innocent party to exercise his legal right to treat himself as discharged by the other's breach. If the ground of the application is that the vendor has failed to show a good title, the court may refuse to discharge the contract if the defect has been cured before the hearing of the application. If one party fails to comply with the directions of the court as to completion, the court will normally grant an application by the other party for the discharge of the contract.

The order may direct that the contract be discharged if the party in default does not complete it within some specified time, and if the latter has clearly indicated his refusal or inability to complete the contract it is thought that the court may discharge it forthwith.

10 Similarly, Spry in Equitable Remedies (5th ed 1997) states (omitting citations) at p 652: "Hence in circumstances of the kind here being discussed, when, for example, an order for specific performance has been made but the defendant does not comply with it, it is unnecessary to commence new proceedings for damages and it is sufficient to apply to the court for dissolution of the order for specific performance and for permission to accept the defendant's repudiation and for an order declaring the contract to be terminated; and an award of damages may thereupon be made" (emphasis added).

11 The notice of motion procedure which these leading texts support, is also supported by the authorities. In Halkett v Earl of Dudley [1907] 1 Ch 590 at 601 Parker J stated that where a right of repudiation arises after a decree of specific performance has been made, the proper course is "to move to be discharged from the contract" (in modern parlance the word "rescission" rather than "repudiation" would, I think, be the appropriate word). In Stevter Holdings Ltd v Katra Constructions Pty Ltd [1975] 1 NSWLR 459 a vendor had obtained a decree of specific performance of a contract for the sale of land. The purchaser later applied successfully by notice of motion in the same suit for an order that it be discharged from the contract.

12 In Singh (Sudagar) v Nazeer [1979] Ch 474 a decree of specific performance was made following a vendor's failure to complete a contract for the sale of land. That decree included the usual declaration that the contract should be specifically performed and carried into execution, as well as an order providing that the vendor execute a proper transfer of the property. It further provided for completion at a time and place to be appointed by the Court, at which time the vendor was to deliver vacant possession to the purchaser. The vendor became ready to comply with the Court's order but the purchaser became dilatory. Due to lack of progress, the vendor gave a completion notice under a condition of the contract. The purchaser failed to complete. The vendor, by notice of motion in the same proceedings, moved for an order forfeiting the deposit, liberty for the vendor to resell and damages. This claim was founded upon the purchaser's failure to comply with the completion notice. Megarry V-C commented that there was "nothing very remarkable about the order for specific performance": at 477. The substantive question before the Court was: when an order for specific performance has been made, is a completion notice subsequently served under the contract valid and effective? Megarry V-C held at 480 - 482: First, it seems clear that when an order for the specific performance of a contract for the sale of land is made, the contract continues to exist and is not merged in the order…

Second, it also seems clear that once an order for specific performance has been made, there are adequate remedies available to either party if the other does not appear to be proceeding under the order with due dispatch. Thus an application may be made for a time and place for completion to be fixed, or for an order rescinding the contract, either forthwith, if the other party is refusing to complete, or else in default of completion within a limited time. I need not set out all the possibilities in detail: they appear in Fry on Specific Performance, 6th ed. (1921), pp. 546 - 553; and see Capital and Suburban Properties Ltd v Swycher [1976] Ch. 319, especially at pp. 330, 331. By applying to the court for an order of specific performance, and obtaining it, I think that the applicant has put it into the hands of the court how the contract is to be carried out. As the court has become seised of the matter, and has made an order, it seems to me that subject to anything that the parties may then agree, the working out, variation or cancellation of that order is essentially a matter for the court. The continued existence of the contract is one thing, its working out is another.

Third, it seems plain that in ordinary circumstances the machinery provisions of a contract for the sale of land are intended to govern the carrying out of the contract between the parties out of court, and are not directed to carrying it out when an order for specific performance has been made. That order is made, of course, by reference to the rights of the parties under the contract; but, when made, it is the provisions of the order and not of the contract which regulate how the contract is to be carried out. Provisions in the contract as to the deduction of title, the preparation and delivery of the conveyance, the mode and date of completion and many other matters must all, it seems to me, yield to any directions on these matters which are given in or under the order for specific performance… In my judgment, where, as in this case, an order for specific performance contains not only the declaratory part but also the consequential directions (I adopt the terminology of Hasham v Zenab [1960] AC 316), those consequential directions regulate the performance of the contract so long as they stand and are not varied by the court. If those consequential directions are not complied with, then the court may make an appropriate order in respect of the default, that default being a breach not so much of the still subsisting contract as of the order of the court as to how that contract is to be carried out: see Griffiths v Vezey [1906] 1 Ch. 796.

That brings me to the fourth point, namely, whether a completion notice served under the contract after the order for specific performance has been made is valid and effective; and that, of course, is the point that I have to decide on this motion. Megarry V-C dismissed the motion, holding that as a matter of construction of the relevant condition of the contract, it did not apply when a decree of specific performance had been made; that even if it was intended to apply, it would not operate unless the decree had contained some provision which preserved its effect, which was not the case; and that the completion notice was accordingly bad.

13 The notice of motion procedure is also supported by the House of Lords' decision in Johnson v Agnew [1980] AC 367. There, on the vendors' summons, an order for specific performance of a contract for the sale of land was made in what was described in the Court of Appeal as "the accustomed form, ordering that the contract be specifically performed, directing certain accounts to be taken, ordering that the amount found to be due to the vendors on the taking of those accounts be certified, ordering that the vendors be at liberty to execute a suitable conveyance in escrow and directing that upon the vendors, at a time and place to be appointed by the court, delivering such conveyance to the purchaser together with the title deeds and an acknowledgement in respect of any deeds not handed over the purchaser should at the same time and place pay to the vendors the amount of the certified balance": [1978] Ch 176 at 186. Before the order could be carried out, the vendors' mortgagees sold the property. The vendors applied by notice of motion in the same proceedings seeking orders that the purchaser should pay them the balance of the purchase price and interest and for an enquiry as to damages suffered by the vendors by reason of the purchaser's failure to complete. Alternatively, the motion sought a declaration that the vendors were entitled to treat the agreement as repudiated by the purchaser and an enquiry as to damages sustained by them due to that repudiation. The Court of Appeal discharged the order for specific performance and ordered termination of the contract and damages. An appeal to the House of Lords was dismissed. Lord Wilberforce stated a number of "uncontroversial" propositions of law, including the following ([1980] AC 367 at 393-394): Fourthly, if an order for specific performance is sought and is made, the contract remains in effect and is not merged in the judgment for specific performance…

Fifthly, if the order for specific performance is not complied with by the purchaser, the vendor may either apply to the court for enforcement of the order, or may apply to the court to dissolve the order and ask the court to put an end to the contract. For present purposes, the significant point is that the notice of motion procedure was followed by the vendors and accepted by the Court.

14 In Buckman v Rose (1980) 1 BPR 9558 an order was made for the specific performance of contracts for the sale of land. The precise form of the order is not apparent from the judgment. The order reserved liberty to apply. The defendant vendor failed to comply with the order. The plaintiffs then applied, by motion in the same proceedings, for orders rescinding the decree for specific performance and discharging the contracts. The ground of the application was the failure of the defendant to comply with the orders or otherwise to perform the contracts, a failure which the plaintiffs claimed created a repudiation of the contracts which entitled them to have the contracts discharged. When the motion came on for hearing the defendant wished to complete the contracts. McLelland J held that the Court retained jurisdiction after the decree for specific performance to make the orders sought in the notice of motion; that the exercise of the jurisdiction was a matter of discretion; and that in view of the defendant's professed willingness to complete and the fact that both parties had been in occupation for a considerable period, the defendant ought to be given a further opportunity to perform the contracts. His Honour said at 9559: The first ground upon which the defendant resists this application is that the order… for specific performance, being in the nature of a final order, is incapable of being discharged or varied by application in these proceedings except to the limited extent permitted by the Supreme Court Rules… This submission was supported by reference to the principle applied in Bailey v Marinoff (1970) 125 CLR 529 and Gamser v Nominal Defendant (1976) 136 CLR 145.

It is however, well established that the lastmentioned principle does not operate to prevent a court which has made an order for specific performance of a contract from subsequently, on application made in the same proceedings , ordering that the contract be discharged and that proceedings be stayed under the order for specific performance, where the defendant has failed or refused to comply with the order for specific performance… In appropriate circumstances, an application for discharge of the contract may also be made after an order for specific performance, by the defendant…

An order for specific performance does not supersede the contractual rights and obligations of the parties but it subjects the future exercise of those rights and performance of those obligations to the control of the court… (emphasis added)

15 In JAG Investment Pty Ltd v Strati [1981] 2 NSWLR 600 the Court of Appeal held that whether or not a decree for specific performance of a contract is general or specific and conditional upon previous steps having been taken, the approval of the Court is required to exercise any rights of rescission arising under the contract because the future performance of the contract has been brought within the control of the Court, and such approval is a matter for the exercise of the Court's discretion. The decree of specific performance in this case included an order granting liberty to apply. Various events occurred thereafter and ultimately the vendor's solicitors wrote to the purchaser's solicitors giving notice that the contract was terminated as provided by a special condition of the contract. Subsequently the vendor commenced fresh proceedings in which it sought a declaration that the contract had been rescinded. The purchaser cross-claimed in the same proceedings seeking a declaration that the contract had not been rescinded and orders in aid of the earlier decree. It also filed a notice of motion in the original proceedings seeking relief similar to that sought in the cross-claim. At first instance McLelland J made a declaration in the fresh proceedings that the contract had come to an end, dismissed the cross-claim in those proceedings and dismissed the notice of motion of the purchaser in the original proceedings. The appropriate procedure does not appear to have arisen as an issue. There was no suggestion that the notice of motion was procedurally inappropriate.

16 In Sunbird Plaza Pty Ltd v Maloney (1988) 166 CLR 245 at 260 Mason CJ, after reviewing the authorities, said at 260: "we should continue to apply the proposition that rescission after an order for specific performance requires the leave of the court or, more appropriately, the vacation of the order. These authorities proceed on the footing that once a plaintiff has obtained an order for specific performance of a contract, he cannot be permitted to act inconsistently by rescinding it so long as the defendant is required by order of the court to complete the contract".

17 In Precision Pest Control Pty Ltd v Ligon 158 Pty Ltd (2004) 12 BPR 22,681 a specific performance decree was made by consent. It contained a declaration that a contract for the sale of land be specifically performed and carried into execution on the basis that the vendor would convey the land to the purchasers; and, secondly, an order that, in the event of default, the Registrar in Equity be empowered to execute all instruments and do all things in the name of, and on behalf of, the vendors as may be necessary in order to specifically perform and carry into execution the contract. The Court noted the agreement of the parties concerning the time and place for, and amount to be paid on, completion. Subsequently the plaintiff purchasers applied in the same proceedings for an order that the Registrar execute a transfer in accordance with the consent orders. Palmer J held at 22,683 that, although the orders were defective in many respects, "…the future performance of the contract was, by those orders, brought within the control of the court and no party to the contract could exercise a right of rescission or serve a notice to complete without the approval of the court or without first having applied successfully to the court for an order vacating the orders for specific performance: Jag Investment Pty Ltd v Strati [1981] 2 NSWLR 600; Facey v Rawsthorne (1925) 35 CLR 566; Sunbird Plaza Pty Ltd v Maloney (1988) 166 CLR 245. The defendants have never applied to vacate the orders made on 10 November 2004." Palmer J treated the application before him as one whereby the plaintiffs sought the Court's supervision as to how the contract was now to be performed. His Honour said at 22,685 [24]: "How the court supervises the performance of a contract within its control is a matter for the court's discretion: see Jag Investment Pty Ltd v Strati, above. The plaintiffs' failure to bring to the settlement a cheque in favour of the correct payee was a mistake easily corrected, as the plaintiffs immediately offered to do. Mr Binetter unreasonably refused them the opportunity to correct the mistake. In my opinion, the defendants cannot rely upon the defendants' [sic] mistake as a ground upon which the court should now refuse to give such directions as will ensure due performance of the contract by the defendants".

18 In Zorbas v Titan Properties (Aust) [2005] NSWSC 440 the court ordered that a contract for sale of land between the parties "be specifically performed and carried into execution", and that the defendant purchaser attend on a specified date, and at a specified time and place "to do all things necessary to complete" the contract and to pay the plaintiff a specified sum and interest. Liberty to apply was granted. On the date specified in the order the defendant's solicitor failed to attend for settlement. The matter was re-listed before the Court in the original proceedings. Campbell J held: 12 It is a general principle concerning orders for specific performance that once an order for specific performance has been made the contractual rights of the parties are not superseded but the future exercise of rights and performance of obligations under the contract is under the control of the Court - or, looking at it from the other side of the coin, the working out of the order for specific performance is under the control of the Court: Singh v Nazeer [1979] Ch 474 at 481-2; Buckman v Rose (1980) 1 BPR 97059, Sunbird Plaza Pty Ltd v Maloney (1988) 166 CLR 245 at 259-260.

13 Even though there is no mandatory requirement for the Court to give a person who has been ordered to perform a contract a second chance, the Court, both pursuant to its power to control the working out of the order for specific performance, and pursuant to its power under Part 2 rule 3 of the Supreme Court Rules 1970 , to extend times for compliance with a judgment or order, has the power to fix a new time for compliance, if one has already been fixed and not complied with. …

31 For these reasons, I would be willing in principle to make a further order which gives the first defendant further time in which to settle the transaction, and which states with specificity what is to be done at such settlement. Thereafter his Honour made detailed orders to give effect to settlement involving the execution of documents and payment of moneys, and granted liberty to apply.

19 Some of the above cases having been cited by the plaintiff in argument, the defendant submitted that they were distinguishable. The first reason, the defendant submitted, was that the principle that the rights and obligations of parties come under the control of the court after an order for specific performance has been made, only applies where a party purports to rescind the contract, as in Sunbird, and not where a party purports to exercise a contractual right. I do not accept the submission. Cases such as Singh, Precision Pest Control and Zorbas illustrate that the principle applies equally where a party wishes to exercise a contractual right, such as termination, after an order for specific performance has been made.

20 Secondly, the defendant submitted that the cases were distinguishable because, so far as the judgments disclose, they included particular directions to give effect to the general specific performance relief. In contrast, in the present case the specific performance decree did not include particular directions to give effect to the general declaration that the agreement be specifically performed and carried into effect, or to give effect to the general order that the defendants specifically perform and carry into execution the agreement so far as the same remains to be performed. It was conceded for the defendant that had particular directions been made, this point could not be raised. However, it was submitted that having regard to the structure of the decree the defendant was at liberty to exercise her contractual powers without reference to the Court, that the matter did not remain under the control of the Court, and that the relief now sought by the plaintiff could only be sought in fresh proceedings.

21 In my view, this is not a sound point of distinction. In principle, where an order for specific performance has been made, whatever its precise form, the rights and obligations of the parties come under the control of the Court, or, looking at the other side of the coin, the working out of the order of specific performance comes under the control of the Court. In principle, I see no justification for a different procedure depending on the precise form of the order. This is supported by the authority of Pratt v Hawkins (1991) 32 NSWLR 319 where an order was made by consent that a contract for the sale of land "be specifically performed according to its terms". This was similar in form to the order made in the present case. Subsequently a further order was made by consent that the contract "be rescinded". An application was made for the return of the deposit under the Conveyancing Act 1919 s 55(2A). Young J (as his Honour then was) held at 324: "When an order for specific performance of a contract is made, the contractual rights of the parties under the contract continue in existence but there is superadded the requirement to defer to the court's direction and control in respect of any matter which the parties cannot themselves solve by agreement". After referring to Singh, Buckman and Jag (above), his Honour continued at 325: It is not competent, in my view, for vendors who have obtained an order for specific performance to give a notice to complete without the leave of the court… As after a decree of specific performance there can be no termination without the leave of the court, the only appropriate method of procedure is to write a letter to the party allegedly in default indicating that a notice of motion seeking termination will be filed if there is no action by the opponent. Indeed, the preferable course is to apply for directions for the implementation of the decree of specific performance which fixes times and places for various steps to be performed and contains a default order for termination if those times are not complied with.

The vendors put that the consequences I have just indicated only apply if a " full " order for specific performance is made. They take this word from the judgment of Megarry V-C in Singh's case. They point to the fact that in the instant case a very strange form of specific performance order was made. It did not reserve any further consideration or even liberty to apply. It is very difficult to see how the order could have been enforced short of attachment. It should be stated that care must be taken even with consent orders that they can be enforced if need be. Of course the usual form of order made in New South Wales is a declaration that the contract ought to be specifically performed, an order for its specific performance and a reference to the making of directions for the implementation of the decree of specific performance to the master.

However, despite its imperfections it does seem to me that the order made by consent on 17 January does mean that the parties were committed to complete the contract according to its tenor under the control of the court and not otherwise. Because of this view it is not necessary to go to whether the notice to complete was in any event in proper form or whether the vendors were ready willing and able to complete at the appropriate time. (emphasis added) Thus, his Honour contemplated that after judgment for specific performance, where the decree was in similar terms to the order in the present case, the appropriate procedure for further relief was by way of notice of motion in the same proceedings.

22 In my view, the liberty to apply which was granted in the present case authorised the plaintiff to apply for directions as to the implementation of the general order for specific performance, which is what she now seeks to do; but the application could have been made even in the absence of an express reservation of liberty to apply. In Phillips v Walsh (1990) 20 NSWLR 206 at 209-210 McLelland J said (omitting most citations): The question whether any particular application can properly be made in existing proceedings is a matter to be determined according to general law principles as modified by any relevant statutory provision. One such principle of the general law is that when proceedings have been disposed of by a final order which has not been entered, the proceedings are at an end and cannot be revived… There are a number of exceptions and qualifications to this principle but none that has any relevance to the present application, unless it be that subsequent to a final order application may be made for the purpose of dealing with a matter involved in, or arising in the course of, working out that order; for example, by making more specific provision for its implementation or by modifying its operation to take account of some subsequent change of circumstance or by enforcing it. This exception or qualification does not, however, extend to an application made for the purpose of giving substantive relief not sought in the statement of claim or which is substantially different to that given by the final order…

In a final order, liberty to apply is often expressly reserved as authority to make a subsequent application for the purpose of dealing with a matter involved in or arising in the course of working out the order; but the absence of an express reservation of liberty to apply does not preclude such an application: see Penrice v Williams (1883) 23 Ch D 353; Light v West & Sons Ltd [1926] 2 KB 238; Chandless-Chandless v Nicholson [1942] 2 KB 321 and Re Porteous (at 385; 91).

23 For these reasons, in my opinion, the relief sought by the plaintiff pursuant to the notice of motion filed on 19 October 2006 is relief which can be sought in these proceedings and does not require the bringing of a new action. Costs are to be costs in the motion. The exhibits may be returned.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.