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[2025] QCA 170
appellant. By majority, the appeal was allowed, the District Court orders of 22 July 2025 were set aside, the buyer's originating application was dismissed, and the respondent was ordered to pay the...
The Court of Appeal divided over when an EFT deposit counts as paid. The majority held that this contract required the deposit holder actually to receive the balance deposit by 5.00 pm on the day the buyer notified the seller of finance approval. The EFT arrived too late, so the buyer breached an essential term and the seller's appeal succeeded. Bradley JA disagreed about what “pay” meant: he considered the buyer had paid when it completed its instruction to the bank. He agreed, however, that the contract did not contain the implied term found by the primary judge.
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2,000 words · generated 07/10/2026
Novadeck Pty Ltd was the seller and CK & PT Property Holdings Pty Ltd, acting as trustee, was the buyer of a proposed lot in a townhouse development at Mango Hill. Their contract, dated 30 August 2021, set a purchase price of $499,900. It required an initial deposit of $1,000 when the buyer signed and a balance deposit of $48,990, payable “the later of 14 days from Contract Date or upon satisfaction or waiver of the Finance Condition” [2], [45].
2 cited instruments linked from this judgment.
The contract identified Novadeck's solicitors as deposit holder and included the details of their trust account. It also provided that the buyer would be in default if it did not pay the deposit when required [8]. Payment of the deposit was an essential term, and clause 30.3 said time was of the essence, subject to an exception about the time of day for settlement [12].
On 16 October 2024, the buyer's solicitor emailed Novadeck's solicitors giving notice that the buyer had received satisfactory finance approval. On the same day, the buyer instructed its bank to transfer the balance deposit by EFT. The funds were not received in the deposit holder's account before 5.00 pm. At 6.33 pm, Novadeck's solicitors gave notice that Novadeck terminated the contract for failure to pay the deposit on time [2].
The District Court granted the buyer specific performance. The Court of Appeal allowed Novadeck's appeal by majority, set aside the District Court orders and dismissed the buyer's originating application. The respondent was ordered to pay the appellant's costs of both the appeal and originating application [38]. Bradley JA dissented: he would have dismissed the appeal [39]-[40], [94].
The central questions for the majority were what “pay” meant in clause 3.2(a), and when the contract required payment. The majority treated them as connected questions of contract construction. It considered the text in the context of the whole agreement, including the transaction's subject matter, the deposit's function and the express timing provisions [13], [18].
On the first question, Mullins P reasoned that the ordinary meaning of “pay” is to discharge a debt or obligation. That meaning implies that the creditor must receive the payment [24]. The contract named a deposit holder and set out the trust account details. The deposit was not merely an administrative formality: it was an essential term and, in the majority's view, an important step in securing the buyer's performance once the finance condition was no longer operative [16], [29]. The majority therefore rejected the proposition that the buyer had paid merely by instructing its bank.
On timing, the reference schedule made the balance deposit payable “upon” satisfaction or waiver of the finance condition. The majority applied the reasoning in Brien v Dwyer, a case concerning a deposit under a land-sale contract. It adopted the construction of “upon” as “at the time of”, rather than “within a reasonable time after” [20], [23]. In this contract, satisfaction of the finance condition was linked to the buyer's written notice of satisfactory finance approval under clause 15(d) [25]-[26].
The contract also specified what happened when an act was required on a particular day: under clause 1.3(f)(ii), it had to be done before 5.00 pm on that day to count as done that day [7], [28]. The majority held that giving the notice on 16 October made that day the payment day. As the funds were not received by 5.00 pm, the buyer had not paid on time and had breached an essential term [29]-[30].
The majority also rejected the implied terms advanced by the buyer. The primary judge had implied a term that, where the buyer paid by EFT and notified the deposit holder, payment would be treated as received on the day the EFT was effected, provided the buyer did not act to defer payment [3], [32]. The buyer also contended that payment could be made within a reasonable time after finance approval [4]. Mullins P held that neither term was necessary to make the contract work commercially and both would conflict with the express timing and essential-term provisions [32]-[34].
Bradley JA took a different view of what “pay” meant. He considered the contract's commercial setting and the buyer's limited control over the banks' processing times. In his view, the buyer discharged its obligation when it completed the instruction for a same-day EFT, the step within its control [90]-[93]. He agreed with the majority that the primary judge's implied term was not necessary and would be inconsistent with the contract, but that did not determine the result on his construction [40].
The judgment presents the majority's reasoning as an application of established contract-construction principles, not as a general rule that every EFT payment is effective only on receipt or that every contract's use of “upon” necessarily means “at the time of”. The contract's particular wording and setting mattered. The majority relied on the approach to commercial contract construction in Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [13], then considered the deposit-specific reasoning in Brien v Dwyer [20]-[23].
The judgment explains that Brien concerned a deposit under a contract for sale of land and records the majority judges' treatment of “upon” as meaning “at the time of” in that setting. It also notes that Romanos v Pentagold Investments Pty Ltd confirmed the importance of a land-sale deposit as earnest to bind the bargain and said the reasoning in Brien applied to contracts requiring deposits in instalments at times stated to be essential [20]-[21].
The majority applied those authorities to this contract's combination of terms: “payable ... upon satisfaction”, payment as an essential term, and time being of the essence. It did not accept that the word “upon” could be qualified by a reasonable-time allowance in this context [23], [29], [33]-[34].
The decision also exposes disagreement about the commercial meaning of “payment” where the contract permits electronic transfer but does not expressly say whether payment occurs on instruction, debit, receipt by the destination bank, or availability in the recipient's account. The majority's answer on these facts was receipt by the deposit holder before the contractual deadline. Bradley JA's dissent illustrates a competing construction based on control over the EFT process and the deposit's commercial purpose [88]-[93]. The judgment itself does not establish that later courts have adopted either approach in other contractual settings.
At [24], Mullins P stated: “It is implicit in the ordinary meaning of ‘pay’ ... that the payment must be received by the creditor.” In plain English, sending an instruction or starting a transfer is not necessarily enough. For this contract, the majority treated receipt by the deposit holder as the relevant completion point.
At [23], the majority said it was appropriate to apply Brien's reasoning, equating “upon” with “at the time of”. Put simply, it did not read the contract as allowing an open-ended or reasonable period after finance approval to make the deposit payment.
At [28], Mullins P held that the notice of satisfaction occurred on a particular day and that clause 1.3(f)(ii) required payment by 5.00 pm for it to count as done that day. The practical effect was that the contractual deadline applied even though the trigger was an event, rather than a calendar date specified in advance.
At [30], the majority applied that reasoning: because the EFT had not reached the deposit holder's account before 5.00 pm on the due date, the buyer had not paid in time. The fact that the buyer had instructed the bank earlier did not change the majority's construction [31].
At [92], Bradley JA expressed the opposing view. He considered a reasonable businessperson would regard the buyer as having paid once it completed the instruction for same-day payment by EFT. In plain English, his view was that a payer should not be treated as late because of subsequent bank processing steps outside its control. This was a dissenting view, not the Court's majority holding.
The judgment is most directly relevant where a contract for the sale of real property requires a deposit at a time linked to satisfaction or waiver of a condition, makes deposit payment an essential term, and specifies a strict deadline or makes time of the essence. It is especially pertinent where the contract identifies a deposit holder and account but does not expressly define the moment when an EFT counts as payment [5]-[12], [14], [18].
It may also be relevant where the payer argues that an EFT instruction, rather than receipt of funds, satisfies a payment obligation, or that payment may occur within a reasonable time after the triggering event. The judgment's disagreement shows why the contract's actual wording, the destination of payment, the deadline, and any provisions dealing expressly with electronic transfers matter [23]-[34], [89]-[93].
The reasoning should not be detached from the particular clauses. The majority relied on the essential-term status of the deposit, the time-is-of-the-essence clause, the 5.00 pm rule, and the deposit's role in the sale of real property. The judgment does not determine how different wording, such as an express rule that payment occurs upon the payer's instruction or upon debit from the payer's account, would operate.
The supplied judgment contains no discussion of decisions delivered after this Court of Appeal judgment, and it gives no account of subsequent treatment by other courts. It would therefore be unsupported to state whether later courts have followed, distinguished or criticised it.
Within this judgment, the majority discussed and applied Brien v Dwyer to construe “upon” in the context of a land-sale deposit [20]-[23]. It cited Romanos v Pentagold Investments Pty Ltd on the deposit's function and the application of Brien to instalment deposits stated to be essential [21]. It also cited Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd for the general approach to commercial contract construction [13].
Bradley JA's dissent referred to commercial construction principles and developed an alternative account of EFT payment based on the buyer's control over the transfer process [83]-[93]. The existence of that dissent is material when describing the judgment: the holding that receipt was required was the majority's conclusion, not a unanimous view.
The judgment does not decide how a contract should be construed if it expressly defines when an EFT payment is complete. It also does not determine whether different wording, such as a requirement to initiate a transfer by a stated time, would lead to a different result.
The majority and dissent differed over the significance of bank processing outside the payer's control. The majority treated the contract's express deadline and the deposit's essential status as decisive. Bradley JA considered it commercially problematic to make contractual rights depend on timing steps controlled by banks [90]-[93]. The judgment resolves that disagreement for the contract before it, but does not set out a general test for all electronic-payment arrangements.
The reasons also do not decide what happens where the recipient's conduct, an account error, or some other circumstance affects the timing of receipt. Bradley JA described evidence about when the money left the payer's bank, reached the recipient bank, and became available, while noting that the meaning of some bank statements was not explored [70], [75]. The majority's conclusion was that receipt into the deposit holder's account had not occurred before the deadline [30].
Finally, the judgment does not provide a general account of how a clause expressly addressing EFT delays would interact with “upon”, a time-is-of-the-essence term, or an essential deposit obligation. It noted that a subsequent version of the REIQ contract made express provision for EFT and certain transmission delays, but held that such a term could not be implied into the contract in dispute [32]-[34].
This is general legal information, not legal advice. Zoe can make mistakes. Before acting on or relying on this analysis, have a qualified Australian lawyer check it.
Source: Queensland Judgments (Supreme Court Library Queensland) (www.queenslandjudgments.com.au). Converted to plain text by ZoeLaw. Not the official version.
SUPREME COURT OF QUEENSLAND
CITATION: Novadeck Pty Ltd v CK & PT Property Holdings Pty Ltd [2025] QCA 170
PARTIES: NOVADECK PTY LTD (ABN 65 602 273 932) / (appellant) / v / CK & PT PROPERTY HOLDINGS PTY LTD ATF CK AND PT PROPERTY 1 (ACN 651 775 996) / (respondent)
FILE NO/S: Appeal No 881 of 2025 / DC No 3147 of 2024
DIVISION: Court of Appeal
PROCEEDING: General Civil Appeal
ORIGINATING COURT: District Court at Brisbane – [2025] QDC 50 (Burnett DCJ)
DELIVERED ON: 12 September 2025
DELIVERED AT: Brisbane
HEARING DATE: 24 July 2025
JUDGES: Bowskill CJ, Mullins P and Bradley JA
ORDERS: Appeal allowed. Set aside the orders made on 22 July 2025 by the primary judge. The application filed in District Court proceeding 3147 of 2024 on 11 November 2024 (the originating application) is dismissed. The respondent must pay the appellant’s costs of the appeal and the originating application.
CATCHWORDS: CONVEYANCING – THE CONTRACT AND CONDITIONS OF SALE – DEPOSIT – TIME FOR PAYMENT – where the vendor and purchaser were parties to a contract for the purchase of a proposed lot in a unit development – where the contract required the balance deposit to be paid by the purchaser or upon satisfaction or waiver of the finance condition – where the contract provided if an act was required to be done on a particular day, it must be done before 5.00 pm on that day or it would be considered to have been done the following day – where the payment of the deposit and the clause providing that time was of the essence of the contract were essential terms – where the contract did not expressly specify the means for payment of the balance deposit – where the purchaser gave written notice on 16 October 2024 to the vendor it had received satisfactory finance approval – where the purchaser gave instructions to its bank to pay the balance deposit by EFT to the deposit holder on the morning of the 16 October 2024 – where the balance deposit had not been received into the deposit holder’s bank account by 5.00 pm on 16 October 2024 – where the vendor’s solicitor gave notice to the purchaser that the vendor terminated the contract for failure to pay the balance deposit on the date of satisfaction of the finance condition – where the purchaser obtained an order for specific performance – where the primary judge construed the term “pay” as not extending to receipt of the funds by the deposit holder – where the purchaser argued that payment “upon” satisfaction of the finance condition should be construed as meaning within a reasonable time after satisfaction of the finance condition – whether the term “pay” extends to receipt of the balance deposit by the deposit holder – whether the term “upon” requires the funds to be received on the same day as, or within a reasonable time after, the satisfaction of the finance condition – whether there was scope in the contract for an implied term that if the deposit was paid by EFT and the deposit holder notified, the deposit holder was taken to have received the deposit on the day the EFT was effected / Brien v Dwyer (1978) 141 CLR 378; [1978] HCA 50, considered / Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104; [2015] HCA 37, cited / National Australia Bank Ltd v KDS Construction Services Pty Ltd (1987) 163 CLR 668; [1987] HCA 65, cited / Romanos v Pentagold Investments Pty Ltd (2003) 217 CLR 367; [2003] HCA 58, cited / Tilley v Official Receiver in Bankruptcy (1960) 103 CLR 529; [1960] HCA 86, cited
COUNSEL: A I O'Brien, with J B O'Brien, for the appellant / C M Doyle for the respondent
SOLICITORS: David K Lawyers for the appellant / Kilmartin Knyvett Lawyers for the respondent
BOWSKILL CJ: I agree with Mullins P.
MULLINS P: The appellant was the seller under the contract dated 30 August 2021 of proposed lot number 31 in a unit development at Mango Hill to the respondent as the buyer. The reference schedule of the contract provided for an initial deposit of $1,000 that was payable when the buyer signed the contract and a balance deposit of $48,990 “payable the later of 14 days from Contract Date or upon satisfaction or waiver of the Finance Condition (if any)”. On 16 October 2024, the respondent’s conveyancing solicitor emailed the appellant’s solicitors that the respondent had received satisfactory finance approval. The hearing before the primary judge was conducted on the basis that 16 October 2024 was the date of satisfaction of the finance condition. The buyer gave instructions to its bank on 16 October 2024 to pay the balance deposit to the deposit holder under the contract on 16 October 2024 but the deposit was not received into the bank account of the deposit holder until after 5.00 pm on that date. At 6.33 pm on 16 October 2024, the solicitors for the appellant gave notice to the respondent that the appellant terminated the contract for failure to pay the balance deposit on the date of satisfaction of the finance condition. The respondent obtained an order for specific performance of the contract in its proceeding in the District Court: CK & PT Property Holdings Pty Ltd atf CK & PT Property v Novadeck Pty Ltd [2025] QDC 50 (the reasons).
The appellant appeals on the grounds:
The primary judge erred (at [28] of the reasons) in determining that on the proper construction of the contract, the word “pay” used in clauses 3.2(a) and 3.2(b) did not require that the appellant to have received the funds comprising the balance deposit.
The primary judge erred (at [22] and [24] of the reasons) by finding an implied term in the contract, namely, “that if payment of the deposit is made by EFT and notified and the purchaser does not take action to defer the payment to the deposit holder it is taken to be received by the deposit holder on the day the EFT is effected”.
Relevant provisions of the contract
In the reference schedule of the contract, the deposit holder was identified as the appellant’s solicitors. The reference schedule had an item for the deposit holder’s trust account details which set out the BSB and account number, the name of the trust account, the bank and the reference that should be used (if a transfer or deposit were made directly to the deposit holder’s trust account).
The term “Business Day” is defined in clause 1.2 of the contract to mean a day other than a Saturday or Sunday and public holiday in Brisbane. The term “Deposit” is defined in clause 1.2 to mean the total deposit monies consisting of the initial deposit and the balance deposit.
Clause 1.3(f) provided:
“Business Days
If anything under this contract must be done on a day that is not a Business Day, it must be done instead on the next Business Day.
If an act is required to be done on a particular day it must be done before 5.00pm on that day or it will be considered to have been done on the following day.”
“(a) The Buyer must pay the Deposit to the Deposit Holder at the times shown in the Reference Schedule. The Deposit Holder will hold the Deposit until a party becomes entitled to it.
The Buyer will be in default if it:
does not pay the Deposit when required;
pays the Deposit by post-dated cheque; or
pays the Deposit by cheque which is dishonoured on presentation.”
“This Contract is subject to and conditional upon the Buyer obtaining Finance Approval on terms satisfactory to the Buyer from a Bank or other financial institution in respect of the Lot 21 days from the date the Seller notifies the Buyer that the Property has reached practical completion (‘Finance Due Date’).”
“(d) The Buyer must give written notice to the Seller by 5.00pm on the Finance Due Date that:
The Buyer has not obtained satisfactory Finance Approval in respect of the Lot in which case the contract will be at an end; or
The Buyer has obtained satisfactory Finance Approval in respect of the Lot in which case the contract will no longer be subject to this Clause 15.
The Seller may terminate the Contract by notice in writing to the Buyer if no notice if given under this clause by 5.00pm on the Finance Due Date. This is the Sellers’s only remedy for the Buyers failure to give notice:
The Sellers right to terminate under this clause if subject to the Buyer’s continuing right to give written notice to the Seller of satisfaction, termination or waiver under this clause.
This Clause 15 has been inserted for the benefit of the Buyer and accordingly the Buyer may waive its rights under this Clause 15 at any time.”
For completeness, clause 16 of the contract should be noted as it provided an alternative means of paying the deposit required by clause 3.2 by the payment or substitution of the deposit with a bank guarantee or deposit bond on the terms set out in that clause.
Clause 30 of the contract set out the essential terms of the contract, including in clause 30.1(b) the buyer’s obligation to pay the deposit under clause 3.2(a). Clause 30.3 provided:
“Time is of the essence of this contract, except regarding any agreement between the parties on a time of day for Settlement. This is an essential term of this contract.”
Construction of the contract
The grounds of appeal and the notice of contention raise two related issues that are resolved by the construction of the contract. The first issue is the meaning of “pay” in clause 3.2(a) of the contract and whether pay extends to receipt of the payment. The second issue is the timing of the payment required by the terms of the contract. The proper approach to the construction of commercial contracts is settled: Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 at [46]-[51].
Putting to one side the alternative means of bank guarantee or deposit bond under clause 16, there was no provision in the contract that specified expressly the means for the payment of the balance deposit. This can be contrasted with clause 3.4 which provided that on the settlement date, the buyer must pay the balance purchase price by bank cheque as the seller directs. (The term “Bank Cheque” was defined in clause 1.2 to mean a cheque drawn by a bank on itself where “Bank” also had a defined meaning.)
The provision in clause 3.2(b) that the buyer would be in default if it paid the deposit by post-dated cheque or by cheque which was dishonoured on presentation indicated that the parties contemplated that the balance deposit might be paid by personal cheque. Clause 3.2(b) reflected the longstanding position in relation to payment by cheque (in the absence of any contrary agreement between the payer and the payee) that when a cheque is received in payment of a debt, it operates as a conditional payment that the cheque will be paid on presentation and, if it is honoured, it ranks as payment from the time the cheque was given and, if it is dishonoured, it is no longer considered to be payment: see Tilley v Official Receiver in Bankruptcy (1960) 103 CLR 529 at 532, 535-536 and 537; and National Australia Bank Ltd v KDS Construction Services Pty Ltd (1987) 163 CLR 668 at 676.
The inclusion of the deposit holder’s trust account details in the reference schedule indicated the parties also contemplated that the balance deposit might be paid by a means for which the details of the deposit holder’s trust account details was relevant. This could include electronic funds transfer (EFT) direct to that trust account or otherwise by a deposit of a cheque or cash or telegraphic transfer of the funds direct to that trust account (or a combination of these means).
The respondent had a choice of means available under the contract to pay the balance deposit.
Under clause 3.2(a) the balance deposit had to be paid at the time shown in the reference schedule for that payment. The timing of the payment was relevantly expressed to be “upon” satisfaction of the finance condition. The use of the word “pay” in clause 3.2(a) of the contract and the word “upon” in the reference schedule for the payment of the balance deposit must be construed in the context of the whole contract. The subject matter of the contract, namely real property, was relevant both to the construction of “pay” in clause 3.2(a) and the timing of that payment provided for in the reference schedule. This is illustrated by the decision in (1978) 141 CLR 378.
“I agree that there is no warrant for qualifying the words in cl. 1 by such expressions as ‘or within a reasonable time thereafter’ or for reading ‘upon’ as meaning ‘on or after’. The words are ‘upon the signing of this agreement’, but the obligation which they impose may be effectively discharged by the purchaser making payment to the estate agent before the counterparts are exchanged, or when both parties sign the one document contemporaneously. It is not until the standard form document is signed by both parties, or signed copies exchanged, that there is anything which answers the description ‘this agreement’ in cl. 1, and it is not until then that any obligation on either party arises.”
It was an aspect of the reasoning of each of Barwick CJ (at 385-386), Gibbs J (at 392) and Aickin J (at 406) that the nature of a deposit under a contract for the sale of land “as an earnest of performance” or “as an earnest given by the purchaser to bind the bargain and as security for its performance” affected the interpretation of the word “upon” in clause 1 of the relevant contract. Jacobs J differed in the construction given to “upon the signing of this agreement” from the majority in Brien, holding (at 402) that the words meant “at the earliest practicable time after the signing”. Stephen J agreed (at 396) with that aspect of Jacobs J’s judgment.
The importance of a deposit for the purchase of real property as “an earnest … to bind the bargain” and the authority of Brien in that regard was confirmed by the plurality in Romanos v Pentagold Investments Pty Ltd (2003) 217 CLR 367 at [20] and that the reasoning in Brien was “no less applicable to contracts providing for the payment of a deposit in particular instalments at times each stated to be essential”.
The respondent seeks to distinguish Brien on the basis that it was concerned with whether a contract came into existence and relies instead on cases concerned with circumstances other than the payment of a deposit under a contract for the purchase of real property where “upon” was construed as meaning “after” and was taken to mean within a reasonable time after the event specified. These cases included Koon Wing Lau v Calwell (1949) 80 CLR 533 at 573 and Mereworth Property Pty Ltd v Mereworth Pastoral Pty Ltd [2024] NSWSC 475 at [22]. Reliance by the purchaser in Brien on Koon Wing Lau was expressly rejected by Gibbs J (at 391) and impliedly rejected by the reasoning of Barwick CJ and Aickin J.
It is appropriate to apply the reasoning of Barwick CJ and Gibbs and Aickin JJ in Brien that equated “upon” with “at the time of” in this appeal to the parties’ specification of the timing of the payment of the balance deposit (which was the major portion of the deposit due under the contract) “upon” the satisfaction of the finance condition.
The primary judge set out (at [13] of the reasons) the definition of “pay” in the Macquarie Dictionary which accords with the ordinary meaning of “pay” which is to discharge a debt or obligation or to give money in discharge of a debt or obligation. It is implicit in the ordinary meaning of “pay”, however, that the payment must be received by the creditor for the debt or obligation to be discharged.
The term “Finance Condition” used in the reference schedule in connection with the date of payment of the balance deposit was not a defined term under the contract. Clause 15 applied where the contract was subject to finance and therefore was the “Finance Condition”. The term “Finance Due Date” was given a specific meaning by the operation of clause 15(c) and the special condition as 21 days from the date the respondent notified the appellant the property had reached practical completion. There was also no express provision as to the meaning of “satisfaction or waiver” of the finance condition but clause 15(d) provided for written notice to be given to the appellant by 5.00 pm on the finance due date that the respondent had either not obtained satisfactory finance approval or had obtained satisfactory finance approval. Clause 15(g) expressly provided that clause 15 was inserted for the benefit of the respondent and that the respondent might waive its rights under clause 15 at any time. The use of “satisfaction” or “waiver” in the reference schedule for the payment of the balance deposit was therefore a reference to the written notice which could be given by the respondent of either satisfaction or waiver in respect of clause 15.
Orders
The parties did not apply to make further submissions on costs after judgment. It is therefore appropriate to dispose of costs at the same time as the orders disposing of the appeal. In view of its success on the appeal, the appellant should have its costs of the appeal and the originating application in the District Court.
The orders which should be made are:
Appeal allowed.
Set aside the orders made on 22 July 2025 by the primary judge.
The application filed in District Court proceeding 3147 of 2024 on 11 November 2024 (the originating application) is dismissed.
The respondent must pay the appellant’s costs of the appeal and the originating application.
BRADLEY JA: For the reasons below, I have concluded that the first ground of appeal fails. On the view I have formed on the proper construction of the contract, the obligation to pay in clause 3.2 of the contract was performed when the respondent (the buyer) had done all that it could to make the relevant payment to the deposit holder’s nominated bank account. The buyer did not have to await the receipt of available funds in the deposit holder’s account.
I agree with the President on the second ground of appeal. The implied term found by the learned primary judge was not necessary to give business efficacy to the contract, and such a term would be inconsistent with the other terms of the contract, properly construed. Owing to my view of the proper construction of the contract, the rejection of such an implied term does not have any consequence for the outcome of the appeal. I would dismiss the appeal.
I am grateful to the President for identifying the relevant contractual provisions, and the circumstances in which the parties made their bargain and subsequently fell into dispute about it. A few additional matters are noted below.
Some other matters about the contract
On 30 August 2021, the parties signed a contract for the sale and purchase of a proposed lot (the lot) in a planned community title scheme (the scheme) including 64 townhouses at Mango Hill (the development). They did so by applying electronic signatures pursuant to the Justice Legislation (COVID-19 Emergency Response—Documents and Oaths) Regulation 2020 (Qld). At that time, Queensland had been subject to a public health emergency declaration for 19 months.1 As the learned primary judge noted, some features of the contract evidenced adjustments “addressing the then extant community concerns, particularly related to human contact.”2
The appellant (the seller) was a property developer, seeking to sell the lots in the scheme, including the lot. The buyer was an investor wishing to purchase the lot. By the contract, the seller agreed to sell to the buyer an estate in fee simple in the lot for the purchase price of $499,900, and the buyer agreed to buy it from the seller at that price. The contract was prepared by the seller’s solicitor. It included 37 clauses, many with sub-clauses and paragraphs, one special condition, and a personal guarantee. It comprised 53 pages. In addition, a disclosure statement formed part of the contract.
The parties
The deposit
Initial Deposit / Balance Deposit / (see clause 3.2) $1,000.00 / $48,990.00 payable when the Buyer signs this Contract / payable the later of 14 Days from Contract Date or upon satisfaction or waiver of the Finance Condition (if any)
Deposit Holder / (see clause 3.2) David K Lawyers
Deposit Holder’s Trust Account Details BSB No. / Account No. / Account Name / Bank / Ref [redacted] / [redacted] / David K Lawyers Law Practice Trust / Westpac Banking Corporation / Lot 31 ‘Kinsellas Residences’
It was common ground that, in the reference schedule, satisfaction of the Finance Condition meant the buyer giving written notice to the seller that the buyer had obtained satisfactory finance approval in respect of the lot. See [48] to [49]. The deposit holder was the seller’s solicitor and the nominated account for payment of the deposit was the solicitor’s practice trust account.
The parties agreed that the buyer would be in default if it did not pay the deposit when required. The seller could recover from the buyer any part of the deposit not paid when required, as a liquidated debt. If the contract was terminated due to the buyer's default, then the seller would be entitled to the deposit and any interest on it. The buyer authorised the deposit holder to release the deposit to the seller immediately if the deposit was forfeited under the terms of the contract.
Subject to finance approval
By the special condition to the contract, the parties modified cl 15(c), to provide for a Finance Due Date, 21 days from when “the Seller notifies the Buyer that the Property has reached practical completion.”3
The parties dealt with the notice of finance approval in cl 15(d) of the contract. Clauses 15(e) and (f) set out one of the seller’s rights to terminate the contract. (Others are noted below.) The parties dealt with waiver of the finance clause in cl 15(g). The relevant clauses are set out in the President’s reasons at [10] above.
Acts done after 5.00 pm
Notices
Settlement
The date for settlement of the sale and purchase of the lot was to be 14 days after the seller notified the buyer that the planned community title scheme had been established and an indefeasible title for the lot had been created, or 14 days after the date of finance approval, if it was a later date.
At any time, the seller could extend the date for settlement, and could do so on any number of occasions, up to a total period of 90 days. However, the settlement date had to be no later than 30 August 2025, being four years after the contract date.
Essential terms and termination
The buyer’s obligation to pay the deposit (comprising both the initial deposit and the balance deposit) was an essential term of the contract.
If the buyer failed to comply with an essential term, then the seller could affirm or terminate the contract. And, if the seller terminated the contract for failure to comply with an essential term, then relevantly the seller could forfeit the deposit and interest earned on its investment, sue the buyer for damages; and resell the lot. If the seller terminated and resold the lot, then the seller could recover from the buyer as “liquidated damages”, any deficiency in price on a resale and its costs associated with any failed attempt to resell and the resale.
The buyer could not terminate the contract, even for breach by the seller of an essential term,4 unless the buyer had first given the seller a notice to remedy the relevant default within a period of not less than ten business days. If the seller remedied the default within the ten business day period, then the buyer was not entitled to terminate the contract.
Seller’s ability to terminate
The seller’s right to sell the land
Restriction on assignment or sale by the buyer
Restrictions on changes to the buyer as trustee
Caveats and settlement notice
Personal guarantee
On 26 August 2021, the two directors of the buyer had executed a deed of guarantee and indemnity. By it, the directors, jointly and severally, unconditionally and irrevocably guaranteed to the seller the due and punctual performance of the buyer of all obligations under the contract. They agreed to indemnify the seller unconditionally and irrevocably against any liability, damages, costs, expenses and losses resulting from any buyer’s default, breach, failure to observe a term or obligation of the contract or the buyer having no such obligations, being relieved of its obligations, or any of its obligations becoming unenforceable under the contract.
By the contract, the parties agreed the contract was not binding on the seller until two persons of financial substance satisfactory to the seller had guaranteed the buyer’s performance in that form.
Events from when the contract was signed
On 30 August 2021, on signing the contract, the buyer paid the initial deposit of $1,000 to the deposit holder. It was a small, but legally effective payment to bind the bargain. Given the plethora of paths the seller could take at that time to terminate the contract, perhaps it was an appropriately modest sum.
More than three years later, on Wednesday 25 September 2024, at 5.01 pm, the seller gave the buyer notice of practical completion. As the notice was given after 5.00 pm, the Finance Due Date was Thursday 17 October 2024. By 5.00 pm on that day, the buyer was obliged to give the seller written notice that the buyer had obtained or not obtained satisfactory Finance Approval.
The primary judge found, on Wednesday 16 October 2024, at 10.32 am, the plaintiff caused its bank to transfer by EFT a sum of $48,990 into the deposit holder’s trust account.5 The buyer did so by completing a request to its bank to transfer the balance deposit of $48,990 from its bank account to the deposit holder’s trust account. At 10.32 am that morning, the buyer’s bank issued a “Payment summary”, which stated that the request had been “Completed”. The payment was to the BSB and account numbers for the deposit holder, as specified in the reference schedule.
At 11.50 am on 16 October 2024, more than an hour later, the buyer’s solicitor sent two emails to the seller’s solicitor. The first conveyed instructions from the buyer that it had received satisfactory finance approval, so that the contract was unconditional. The second email gave the seller notice that the buyer had “attended to the payment of the Balance Deposit”. This second email asked the seller’s solicitor (and deposit holder) to “confirm receipt and provide us with a trust receipt when available.”
So, from about 11.50 am on 16 October 2024, the seller knew that the contract had become unconditional, and the buyer had attended to the payment of the balance deposit. Through its solicitor, the seller knew that the buyer had not given the deposit holder a cheque for the balance deposit. So, the seller knew the buyer had attended to payment in some other way. The most likely way was by EFT to the deposit holder’s trust account.
Through its solicitor, the seller was able to know whether and when the balance deposit had been received into the deposit holder’s trust account. At no time between 11.50 am and 6.30 pm did the seller alert the buyer that the balance deposit had not been received. If the buyer could have done anything to ensure receipt of funds by the deposit holder before 5.00 pm, which seems unlikely on the evidence before the Court, then the seller did nothing that would have allowed the buyer to take such action.
In the evidence before the primary judge: the buyer’s bank stated the payment “left” the bank at 6.06 pm on 16 October 2024; and the deposit holder’s bank stated that it received “the file” from the buyer’s bank at 8.33 pm on 16 October 2024, and the “funds were released into” the deposit holder’s account at 9.38 pm that day. The meaning of these statements was not explored. His Honour concluded that the sum did not depart the buyer’s bank until 6.06 pm and was not received into the deposit holder’s account until 8.33 pm. Those findings were not challenged in the appeal.
The payment of money between bank accounts
EFT is a transfer of money from one bank account to another by electronic systems. As in the present case, a bank customer gives an instruction to the bank to pay an amount to the bank account of the receiving customer by instructing the bank to pay it to the relevant BSB and account numbers for the receiving customer.
It is usual for a purchaser of land to pay a deposit by EFT to the deposit holder’s trust account. The inclusion in the reference schedule of the BSB and account numbers for the deposit holder’s trust account confirms this was the practice contemplated by the parties when they made the contract. With the increasing use of EFT payments, some banks have ceased offering cheque facilities to their customers, and some have ceased accepting deposits by cheque.
The President contemplates above at [16] that the BSB and account numbers in the reference schedule would also have allowed the buyer to make a “telegraphic transfer” (TT) to the account. A TT bears a name from its origin in communications between banks by telegram and later by telex. Since telegrams and telex machines became redundant, a transfer sometimes still referred to as a TT, is made by EFT. Whether described as TT or EFT, it is a same day electronic transfer of funds between banks within Australia.
As is plain from the evidence in this case, a same day electronic transfer completed by 10.32 am, is not necessarily received by the payee customer’s bank before 5.00 pm the same day. There can be a period of more than seven hours between the payer’s instruction to its bank being “completed” and the funds “leaving” the bank. There can be a period of more than two hours between the funds “leaving” the payer’s bank and the payee’s bank “receiving” the funds. Even after the payee’s bank “receives” the funds, there may be a further period of more than two hours before the funds are “available” in payee’s account.
As the President notes, the buyer could have paid the balance deposit by cheque, instead of by EFT. The deposit holder would have had to present the buyer’s cheque to the deposit holder’s bank. The deposit holder’s bank would have communicated with the buyer’s bank, requesting them to debit the buyer’s bank account for the cheque amount and authorise the deposit holder’s bank to credit that amount to the deposit holder’s trust account. The buyer’s bank would check that the buyer had sufficient funds available in its account to make the payment and confirm that the buyer had not given a “stop payment” instruction for the cheque. Even with contemporary communications technology, clearing a cheque in this way is not instantaneous. In common experience, it takes about three days.6
If the buyer’s bank cleared the buyer’s cheque, then the buyer’s bank would honour the cheque and complete the payment by EFT from the buyer’s bank to the deposit holder’s bank. The possible delays in such a transfer of funds have been noted above. If the buyer’s bank did not clear the buyer’s cheque, it would dishonour the cheque, advise the deposit holder’s bank of the dishonour, and not complete any payment by EFT from the buyer’s bank to the deposit holder’s bank.
Proper construction of the contract
“Unless a contrary intention is indicated in a contract, a Court is entitled to approach the task of giving a commercial contract a business-like interpretation on the assumption ‘that the parties … intended to produce a commercial result’. … Further, a commercial contract is to be interpreted so as to avoid ‘making commercial nonsense or working commercial inconvenience’. The commercial purpose of the contract is the purpose of reasonable persons in the position of the parties at the time of a contract. Hence, in determining meaning, the Court has to ask ‘what a reasonable businessperson would have understood’ the contract to mean. This question directs the Court to consider ‘the language used by the parties in the contract, the circumstances addressed by the contract and the commercial purpose or objects to be secured by the contract’. The whole of the contract has to be considered as the meaning of one part may be revealed by other parts. Literal interpretations which lack commercial efficacy or common sense are, where possible, to be avoided.”10
The Court may assume the parties intended the contract to produce a commercial result, there being no contrary indication.
When the parties made the contract, the buyer, the seller and the deposit holder were located in different cities. They knew the possible impediments to individuals being in the same place at the same time, or even within two metres of each other. The use of cheque or EFT to make a payment would avoid problems that might arise from such a separation of parties.
The balance deposit was payable to the deposit holder’s trust account identified by name, and BSB and account numbers. The parties contemplated payment by cheque in favour of the named account or by EFT to the account identified by the BSB and account numbers. Indeed, in August 2021, payment by EFT could be described as payment “according to the ordinary usages”.11
I agree with the President’s conclusion, at [20]-[21] above, that the primary purpose of the deposit was as “a guarantee that the purchaser means business”12 or “an earnest to bind the bargain” that “creates by the fear of its forfeiture a motive in the payer to perform the rest of the contract.”13 Those objects would be achieved once the buyer completed its instructions to its bank to pay the balance deposit to the deposit holder’s trust account by EFT.
It was not important whether the seller would have ready access to the balance deposit as available funds before or after 5.00 pm on the day a payment was made. The balance deposit was to be held by the deposit holder in its trust account, with the initial deposit paid more than three years earlier. It would not be available to the seller for its use until settlement or lawful earlier termination of the contract. The receipt of available funds was not a purpose of the contractual provision about payment of the balance deposit.
Relevantly, the parties agreed that the balance deposit was “payable … upon satisfaction … of the Finance Condition”. The Financial Condition would be satisfied when the buyer gave the seller written notice to that effect. That notice was to be given by 5.00 pm on the Finance Due Date. The parties contemplated written notice by email and the respective solicitors had nominated email addresses for communications. I agree with the President, at [22] above, that application of the separate reasons in Brien v Dwyer, leads to the conclusion in this appeal that “upon” means “at the time of” and does not extend to include “within a reasonable time after”. This is its ordinary meaning.
Disposition
Appeal dismissed.
Appellant to pay the respondent’s costs of the appeal.
Under s 319 of the Public Health Act 2005 (Qld). ↩
The reasons at [16]. ↩
Refer to [9] of above. ↩
The seller’s obligations that were essential terms comprised the obligations to effect settlement (see [52]-[53]), and to give the buyer vacant possession, any title necessary to register the transfer to the buyer, and any keys in its possession or control: cl 30.2. ↩
The reasons at [5]. ↩
Perhaps longer if the deposit holder presents the cheque at a bank agency, such as a post office. ↩
(1960) 103 CLR 529, 532, 535-539, and 537. ↩
(1987) 163 CLR 668, 676. ↩
(2022) 11 QR 648 at [53]. ↩
Citing Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104, 116 [47], 117 [51] (French CJ, Nettle and Gordon JJ); Electricity Generation Corporation v Woodside Energy Limited (2014) 251 CLR 640, 657 [35] (French CJ, Hayne, Crennan and Kiefel JJ); Zhu v Treasurer of New South Wales (2004) 218 CLR 530, 559 [82] (Gleeson CJ, Gummow, Kirby, Callinan and Heydon JJ); Australian Broadcasting Commission v Australasian Performing Right Association Ltd (1973) 129 CLR 99, 109 (Gibbs J); Gollin & Co Ltd v Karenlee Nominees Pty Ltd (1983) 153 CLR 455, 464 (Mason, Murphy, Brennan, Deane and Dawson JJ). ↩
Novadeck Pty Ltd
CK & PT Property Holdings Pty Ltd [2025] QCA 170
(2015) 256 CLR 104
(1987) 163 CLR 668
(1983) 153 CLR 455
(1978) 141 CLR 378
(2003) 217 CLR 367
(1960) 103 CLR 529
(1949) 80 CLR 533
(2014) 251 CLR 640
(2004) 218 CLR 530
(1973) 129 CLR 99
By majority, the appeal was allowed, the District Court orders of 22 July 2025 were set aside, the buyer's originating application was dismissed, and the respondent was ordered to pay the appellant's costs of the appeal and originating application: [38]. Bradley JA would have dismissed the appeal and ordered the appellant to pay the respondent's appeal costs: [94].
An issue arose in Brien as to the timing of the payment of a deposit under clause 1 of the contract for the sale of land which provided that the purchaser should, upon the signing of the agreement, pay a specified sum as a deposit to the vendors’ agent and that the deposit might be paid by cheque. The purchaser had not made the deposit at the time the contract was signed. The vendors did not find out until more than two months later that a post-dated cheque given for the deposit by the purchaser to the agent well after the contract had been signed had finally been banked and cleared. On finding that out, the vendors terminated the contract for failure to pay the deposit in accordance with the contract. The purchaser was successful in obtaining a decree for specific performance but the vendors then succeeded on their appeal to the New South Wales Court of Appeal which allowed the appeal, set aside the decree and dismissed the purchaser’s claim. The appeal was dismissed in the High Court by Barwick CJ and Gibbs, Stephen and Aickin JJ with Jacobs J dissenting.
Barwick CJ in Brien (at 385) construed the word “upon” in clause 1 of the contract as meaning “at the time of”. In that case, that related to the time of the signature by the purchaser on the form of agreement for transmission to the vendor for his signature. Barwick CJ found there was no room “for construing the clause as meaning within a reasonable time after signature, whether it be a signature by the purchaser or by both parties”. Gibbs J acknowledged (at 391) that the word “upon” is ambiguous but that (at 392) the “primary purpose of the deposit would not be served unless the deposit were paid at the very time when the purchaser assumed his obligations under the contract”. Aickin J agreed with the reasons of Barwick CJ and stated (at 406):
The period for the giving of the written notice of satisfaction expired at 5.00 pm on the finance due date, namely 21 days from the date of notification that the property had reached practical completion. The payment of the balance deposit, however, was not conditioned on the expiry of the period for giving the notice of satisfaction of the finance condition but “upon satisfaction … of the Finance Condition” or, in other words, the giving of the written notice of satisfaction under clause 15(d). The respondent therefore exercised control over the timing of the giving of the written notice of obtaining satisfactory financial approval provided the notice was given by 5.00 pm on the finance due date.
The respondent argues that the obligation to pay the balance deposit was not an obligation falling on a particular day but on the happening of an event, so that the definition of “Business Day” did not apply to the obligation for “an act to be done before 5.00 pm on that day” pursuant to clause 1.3(f)(ii) was not engaged.
Describing the giving of the written notice of satisfaction of the finance condition as an event does not alter the fact that it occurred on a particular day which by application of the terms of the contract became the date for payment for the balance deposit. Where the date for a payment to be made under the contract is determined under the contract, including the date for payment of the balance deposit, clause 1.3(f)(ii) meant that the payment had to be done by 5.00 pm on that day for it to be done on that day.
Consistent with the nature of a deposit for the purchase of real property as “an earnest … to bind the bargain”, the contract made the payment of the balance deposit an essential term in the context where time was expressly of the essence of the contract which was also an essential term. The requirement for payment of the balance deposit coincided with the giving of the written notice of satisfaction of the finance condition. The payment of the balance deposit was a significant step under the contract in securing the respondent’s performance of the purchase when the contract was no longer conditional on finance approval. In that context, payment must have its usual meaning and extend to receipt of the payment by the deposit holder in the manner contemplated by the contract.
The respondent failed to pay the balance deposit on the due date for payment under the contract as the EFT by which the payment of the balance deposit was being made was not received into the account of the deposit holder before 5.00 pm on the due date for payment date. The respondent was therefore in breach of an essential term of the contract.
The respondent was let down by its bank in that the transfer of the balance deposit was not complete before 5.00 pm on the due date for payment, even though the bank was instructed to make the EFT payment in the morning of 16 October 2024. The bank’s failure (or the failure of the means chosen by the respondent to pay the balance deposit) has no bearing on the proper construction of the contract.
The term which the primary judge found should be implied into the contract was based on a provision in a subsequent version of the REIQ contract that makes express provision for payment of the deposit by EFT, including special provision for a delay in the electronic transmission of funds because of circumstances beyond the purchaser’s control.
When full effect is given to clause 30.3 of the contract, the implied term found by the primary judge (based on the subsequent version of the REIQ contract) was not necessary to give business efficacy to the contract. The implied term was inconsistent with the construction which must be given to clause 3.2(a) (and the time shown for payment in the reference schedule) as to the timing of the payment of the balance deposit in the context of the contract for the purchase of real property where that was an essential term and time was of the essence of the contract.
For the same reason, the term that the respondent seeks in its notice of contention to imply is inconsistent with the same provisions of the contract.
The difference in approach between the parties to the construction of the contract is that the appellant seeks to give effect to the terms of the contract and the respondent seeks to modify the operation of the terms of the contract to accommodate the means by which the respondent chose to pay the balance deposit without taking sufficient care to ensure that the payment of the balance deposit was paid before 5.00 pm on the day the written notice of satisfaction of the finance condition was given. The terms of the contract must be given effect as contemplated by the parties when they entered into the contract.
The respondent has failed on the two issues of construction raised by the appeal. The appellant therefore succeeds on the appeal.
At 6.33 pm the same day, the seller’s solicitor sent a letter by email to the buyer’s solicitor. This was after the balance deposit amount had left the buyer’s bank account and before it was received into the deposit holder’s account. By the letter, the seller’s solicitor stated that, at 6.30 pm (also in that interim period), the balance deposit had not been received into its trust account “and accordingly the Balance Deposit has not yet been paid.” By the letter, in this limbo period, the seller gave notice to the buyer “of the termination of the Contract.”
The deposit holder (and the seller) would be in a state of uncertainty until either the funds were made available in the deposit holder’s bank account or the buyer’s bank provided a dishonour notice to the deposit holder’s bank and the bank advised the deposit holder.
By the contract, the parties had agreed that if the buyer paid the deposit by a cheque that was dishonoured on presentation, then the buyer would be in default. Their agreement reflected the reasoning of the High Court in Tilley v Official Receiver in Bankruptcy7 and National Australia Bank Ltd v KDS Construction Services Pty Ltd,8 two of the authorities noted by the President. Their agreement also evidenced a common understanding of circumstances in which payment on a date would not mean the receipt of available funds into the deposit holder’s account before 5.00 pm on that date.
A cheque is a written instruction to pay a person a specific amount of money, which results, when cleared, in an EFT payment. An EFT instruction is an electronic instruction to the same effect. A cheque requires only a named payee. An EFT instruction requires the BSB and account numbers. In each case, there is a delay between providing the instruction to pay and the receipt of the funds according to the instruction. An EFT payment results in funds being received and available to the payee sooner than a cheque, because it does not involve the clearing process.
When the parties made the contract, neither could know with any certainty when instructions for payment (by EFT or a cheque) would result in the funds being made available to the payee party. Their agreement about the effect of payment by a cheque, later dishonoured, dealt with one such scenario. The parties did not include any provision for a “dishonoured” payment by EFT. They did not need to do so.
In two important respects, payment by EFT is unlike payment by cheque. First, while a payer can draw a cheque and give it to a payee without reference to their bank, a bank will not accept an EFT instruction from a payer if the payer does not have funds available for the bank to make the EFT. Second, while a payer can ask their bank to “stop payment” on the cheque, after it has been given to the payee, once a person has completed a request for a same day payment by EFT, they cannot recall it.
Neither party could control when either bank would take the various steps involved in an EFT payment. Nor could it control the periods between the completion of the instruction to pay and the funds leaving the bank, between the funds “leaving” the buyer’s account being “received” by the deposit holder’s bank and between having been “received” and being “available” in the deposit holder’s account. It would make commercial nonsense of the contract to construe cl 3.2 as requiring the buyer to ensure that something beyond its power or control would happen immediately (at the time of) giving notice that finance was approved, or even before 5.00 pm on a given day. To construe the contract in that way would work commercial inconvenience to the parties, making the parties’ respective rights dependent upon the unknown, unpredictable, and uncontrollable conduct of their respective banks. This was a transaction for the sale and purchase of real property, not a wager.
The provision for payment of the balance deposit upon satisfaction of the Finance Condition did not serve the purpose of protecting the seller from any other identifiable harm. Its importance derived from the importance of the buyer demonstrating its commitment to the purchase by paying the balance deposit.
A reasonable businessperson in the position of the parties would have understood the contract to mean that the buyer will have discharged its obligation to pay the balance deposit once the buyer had completed the instruction to its bank to make the same day payment by EFT. This was the only part of the EFT payment process that the buyer could control. It was the equivalent of depositing a cheque to the deposit holder’s account. Indeed, it was the usual means for making such a payment.
On the proper construction of the contract, and in the events that have occurred, the buyer discharged its obligation to pay the balance deposit to the deposit holder at 10.32 am on 16 October 2024. This was before 11.50 am, when the amount became payable upon the buyer giving written notice of satisfaction of the Finance Condition to the seller. It follows that the buyer did not breach the essential term about the time for payment of the deposit in cl 3.2.
Henthorn v Fraser [1892] 2 Ch 27, at 33 (Lord Herschell). ↩
Soper (Pauper) v Arnold (1889) 14 App Cas 429, at 435 (Lord Macnaghten). ↩
Howe v Smith (1884) 27 Ch D 89, 101 (Fry LJ). ↩