PREMIER BUILDING SOLUTIONS PTY LTD (ACN 092 394 833)

Practice and procedure - Appeal against summary judgment - Deeds - Whether there was delivery of the documents - What constitutes delivery - Whether delivery of deeds required - Whether deeds delivered to agent - Whether deeds delivered as escrows - What constitutes an escrow - Whether deed can be delivered as escrow to an intended party - Whether oral condition imposed that was contrary to written terms of the deed - Whether party is entitled to renounce a deed when escrow is not satisfied within a reasonable time - Whether there was evidence of readiness and willingness

Property Law Act 1969, s 9

Orders of the Master set aside and orders dismissing the application for summary judgment and giving the appellant leave to defend the action substituted in lieu thereof

Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd [2001] FCA 1833; (2001) 117 FCR 424

Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47; (2000) 203 CLR 194

Coulton v Holcombe [1986] HCA 33; (1986) 162 CLR 1

Daulia Ltd v Four Millbank Nominees Ltd [1978] Ch 231

Geelong Building Society (in liq) v Encel [1996] VicRp 44; [1996] 1 VR 594

Glessing v Green [1975] 1 WLR 863

House v The King [1936] HCA 40; (1936) 55 CLR 499

Hoyt's Pty Ltd v Spencer [1919] HCA 64; (1919) 27 CLR 133

In re Webb's Lease; Sandom v Webb [1951] Ch 808

Major v Bretherton [1928] HCA 11; (1928) 41 CLR 62

Mathew v Blackmore [1857] EngR 262; (1857) 1 H & N 762

McAlester Canadian Oil Co v Petroleum Engineering Co Ltd (1958) 13 DLR (2d) 724

Metwally (No 2) v University of Wollongong (1985) 60 ALR 68

Naas v Westminster Bank Limited [1940] AC 366

Rose v Rose (1986) 7 NSWLR 679

United Dominions Trust (Commercial) Ltd v Eagle Aircraft Services [1968] 3 All ER 104

Walker v Ware, Hadham & Buntingford Railway Company (1865) LR 1 Eq 195

Water Board v Moustakas [1988] HCA 12; (1988) 180 CLR 491

Westgold Resources NL v St George Bank Ltd (1998) 29 ASCR 396

Wheeldon v Burrows (1879) 12 Ch D 31

1 STEYTLER J: This is an appeal against the judgment of a Master of this Court whereby he ordered that there be a summary judgment in favour of each of the respondents against the appellant arising out of the appellant's execution of a number of documents described as deeds. The judgment was one for specific performance of each deed and for ancillary relief.

2 The Master had before him a large bundle of affidavits. All but one had been filed in support of the application for summary judgment. The exception was an affidavit which had been sworn by the appellant on 4 October 2002.

3 The evidence, as it emerged from the affidavits filed on behalf of the respondents, disclosed that each of the respondents was a shareholder in Tuart Resources Ltd ("the company"). Each of them appointed a stockbroker, Mr Phillip John Coulson, as their agent in respect of their dealings with the company. A seventh shareholder, Ms Anne Louise Hamersley, also appointed Mr Coulson as her agent for that purpose. The respondents and Ms Hamersley did so, according to Mr Coulson (who swore an affidavit on 12 August 2002), "so that ... [he] could attempt to negotiate a commercially advantageous arrangement for each ... [of them], as the value of their respective shareholdings in the Company had dropped considerably". He said that these negotiations took place with the appellant in December 2001 and January 2002. He did not explain why it was that he came to be negotiating with the appellant and nor did he explain what course the negotiations took, save that he said that they culminated in the appellant agreeing "in principle to provide the ... [respondents] with put options over their shares in the Company". According to Mr Coulson, the appellant told him that his reasons for granting the put options were:

"(a) that he envisaged the stock [in the company] to be traded at at least 6 cents by June 2002 [they were then trading at less than half that amount and the option price was 4 cents per share];

(b) that he needed the stock by the end of 2002; and

(c) that ... [Mr Coulson] had shown support towards the company and that ... [the appellant] wished that support to continue until June 2002, by way of the ... [respondents and Ms Hamersley] refraining from selling the shares."

4 Mr Coulson said that each put option was to be provided by deed and that he arranged to have the deeds drawn up by a solicitor. Thereafter, on 11 January 2002, he met with the appellant and Ms Hamersley at Ms Hamersley's home. He presented the appellant with the seven deeds which had been prepared by the solicitor appointed by Mr Coulson for that purpose.

5 The deeds (executed, respectively, in favour of each of the six respondents and Ms Hamersley) were in similar terms. Each recorded that, in consideration of the sum of $1 paid by the grantee to the appellant, receipt of which was acknowledged by the appellant, the appellant granted to the grantee a put option pursuant to which the grantee might require the appellant to purchase shares in the company from the grantee at the specified price and in accordance with the terms and conditions of the deed. There followed a number of provisions dealing with such matters as the manner of exercise of the put option and settlement of the sale of the shares, if the option should be exercised. These included a term to the effect that the put option was to be exercisable by the grantee only during a period commencing on 1 June 2002 and expiring at 5 pm on 28 June 2002 (unless that period was to be extended in writing). Each deed also included a term to the effect that the sale of the shares was to be settled on "the Settlement Date", at a place to be nominated by the grantee, "by payment of the Purchase Price for the Shares by bank cheque or cheques payable to the Grantee ... against receipt from the Grantee of a White Transfer of the Shares executed by the Grantee in favour of the Grantor together with the Share Certificate(s) (if any) relating thereto". Clause 5 of each deed provided that the Grantor should "not be entitled to exercise any voting rights until the Settlement date". Each signature clause, insofar as it related to the appellant, recorded that the document was signed by him as a deed.

6 The appellant read through each of the deeds and then made a note of the name of each grantee, the number of shares held by that person and the "put option sum applicable in each case". He then said that he was "happy" to sign each deed and did so. Mr Coulson then placed the deeds (including that made in favour of Ms Hamersley) in his briefcase and told the appellant that he would arrange for each of the respondents to sign them. Each of the respondents, and Ms Hamersley, later did so.

7 On 29 May 2002, the appellant wrote to Mr Coulson. The body of that letter read as follows:

"Several months ago, by way of offer, I signed agreements in relation to Puts of shares in Tuart Resources Limited owned by yourself, family and clients. Several months have passed and numerous requests have been made for you to communicate acceptance by production of copies of those documents signed by the relevant parties.

Despite those requests, I have never received communication of acceptance and therefore I withdraw my offer effective 29th May 2002. It is only possible for me to inform you as agent as I do not have the details of the clients referred to in documents, as to date I am not in receipt of an acceptance or copy."

8 The respondents did not accept this withdrawal of what the appellant described as his "offer". Instead, on 4 June 2002, each of them served upon the appellant a notice of exercise of the respective put options. However, the appellant never did honour his obligations under each of the deeds notwithstanding that, on a number of occasions after 29 May 2002, he acknowledged that he was bound by them. The sixth respondent, who is Mr Coulson's wife and a practising solicitor, said, in an affidavit sworn by her on 12 August 2002, that, on the date fixed for settlement under the put options, being 18 June 2002, she and another solicitor "were available at the office [presumably a reference to the office which had been designated as the place where settlement would be effected] for the settlement", but that the appellant did not arrive or send any notification of, or explanation for, his absence.

9 The appellant's version of events, as it emerged from his affidavit sworn on 4 October 2002, was rather different. He said that he was "substantially involved" in the development of two vineyards in the south-west of Western Australia, each of which was managed by a company. In 2001 Tuart Resources Ltd acquired the two management companies, each of which needed money. In order to obtain that money the company issued some 56,000,000 shares between November 2001 and March 2002. Moreover, in December 2001 the company "was in negotiations about the allotment of up to 380m shares in the capital of ... [the company] to [Mr] S H Koh". The various issues and proposed issues of shares by the company required ratification by its members and, because of the appellant's "involvement" with the two vineyards, it was important to him that the company should be in a position to lend money to its subsidiary management companies. He was asked by the directors of the company "to obtain support for the required resolutions" and, as a result, spoke with Mr Coulson. He said that he asked Mr Coulson, on about 20 December 2001, "if he would request his clients who owned Tuart shares to vote in support of the issue of shares by Tuart". He went on to say (pars 22 and 23 of his affidavit):

"22. In response to the request made on or about 20/12/01, Coulsen [sic] said he thought he could persuade his clients to agree to vote in support of the required resolutions by Tuart, but that the price of them agreeing to vote that way would be me granting to them put options, which would require me to buy their shares in Tuart for $0.04 cents, exercisable by them in June 2002.

23. I replied I was prepared to grant put options in exchange for the agreement by his clients to vote in support of the required resolutions by Tuart relating to the issue of shares. I also said I believed the price of the Tuart shares would increase by June 2002 and I needed to acquire shares in Tuart anyway because of other commitments I had entered into, but these things were not part of my offer to Coulsen's [sic] clients."

10 Mr Coulson thereafter arranged to have the "agreements" prepared and then met with the appellant at Ms Hamersley's home in order that the appellant might execute them. The appellant read one of the documents and, having done so, asked Mr Coulson "why there was no reference to the agreement by the grantees to them voting in support of the required Tuart resolutions". Mr Coulson responded by saying that "they could not put provisions to that effect into the agreement". According to the appellant (pars 27 to 30 of his affidavit):

"27. I said to Coulsen [sic] I would agree to sign the put options and give them to him ... on the condition he would not deliver them to the grantees until they agreed in exchange for the options to vote in favour of resolutions proposed by Tuart. I requested him to tell me whether his clients agreed to vote in that way and to return the signed put option agreements to me within 7 to 10 days to verify the agreements.

28. I also stated the put options were not enforceable against me until I was told by Coulsen [sic] his clients agreed to vote as required by Tuart and that agreement was verified by the put options being signed by his clients and given to me.

29. Coulsen [sic] said that was what he intended and he had no problem in accepting my condition.

30. On this basis I then signed the put options and gave them to Coulsen [sic]."

11 The appellant said that he thereafter wrote the letter dated 29 May 2002 because he had not received any response to his "proposal" from Mr Coulson's clients. He said that he has never been informed, at any time, by Mr Coulson that any of the "offers" had been accepted.

12 The respondents arranged for Mr Coulson to swear two affidavits in response to that filed on behalf of the appellant. In one of these affidavits (sworn on 18 October 2002) he denied "that there was any reference at all to any conditions to the granting of the put options". However, he went on to say that he was, in any event, informed by each of the respondents "that the condition had been satisfied prior to the delivery of the Deeds". He said, in support of this last contention, that:

a) granted a voting power of attorney to Martin Lawrence Bennett, the Chairman of the Board of Directors of the Company ('Bennett'), in relation to voting at the meetings of the Company in or around July 2001; or

b) abstained from voting at the meetings of the Company; or

c) voted in favour of the resolutions proposed by the ... [appellant] at the meetings of the Company until September ... [2002]."

13 He annexed to that affidavit a bundle of "voting powers of attorney" or "Proxies" which, he said, "granted voting rights to Bennett or failing him Bennett's partner, Anthony William Fairweather in respect of ... [the respondents'] respective shareholdings". That bundle included proxies provided by the second and fifth respondents.

14 In pars 7, 8 and 9 of his affidavit sworn on 18 October 2002, Mr Coulson said:

"7. From my own knowledge acquired whilst working as a stockbroker for Paterson Ord Minnett I state that Nefco Nominees Ltd ('Nefco') and Colbern Fiduciary Nominees Pty Ltd ('Colbern') are the holding companies of Paterson Ord Minnett. Annexed hereto and marked 'PJC2' are copies of proxies executed by Nefco and Colbern ('the Holding Proxies'). Nefco and Colbern held shares for and on behalf of various of the clients of Paterson Ord Minnett. Nefco and Colbern executed the Holding Proxies for and on behalf of the various clients.

8. At the time that the Holding Proxies were signed, the third and sixth plaintiffs or nominees held shares under Colbern and the fourth plaintiff held shares under Nefco. As at July 2001 Nefco held 1,879,000 shares in the Company and Colbern held 4,516,616 shares in the Company ... .

9. I sent the original Proxies and Holding Proxies to the Company by facsimile in or about July 2001."

15 Mr Coulson also deposed to the fact that the proxies to which he referred had never been revoked and that, to the best of his knowledge, each of the resolutions sought to be passed by the company had in fact been passed. He also said that the total number of shares the subject of the proxies to which he referred had exceeded, by some 3,000,000, the total number of shares held by the respondents.

16 In his second replying affidavit, sworn on 28 October 2002, Mr Coulson said that, in his capacity as agent for each of the respondents, he provided to his wife "blank Off Market Transfer forms, as well as the Holder Identification Number for each plaintiff prior to 18 June 2002", which, as I have said, was the settlement date for the purposes of the various put options.

17 The Master provided very brief reasons in support of his decision to award summary judgment. He said that he was satisfied that the documents executed by the appellant "were effective as deeds" and that they had been "delivered back to Mr Coulson" who was, he said, "clearly the agent of the defendant [by which he presumably meant to refer to the respondents]". He said that it seemed to him that that act could "only be seen as delivery of the deeds as is required for a deed to be effective". He went on to say:

"There is an argument to the effect that ... [the appellant] said certain things to Mr Coulson about the deeds only being effective when certain proxies were provided by the ... [respondents] to ... [the appellant]. Assuming that some words to that effect were said it still seems to me that there can be no doubt that there was delivery of the deed and that it became effective and that, I think, is supported by ... Pym v Campbell [1856] EngR 480; (1854) 119 ER 903.

That being the case there was in my view a binding agreement between the parties and it cannot be the case then that there is any collateral agreement which is inconsistent with the terms of the deed. The clear terms of the deed were that when the parties entered into it it did not entitle the ... [appellant] to any voting rights in relation to the shares.

There is an argument that says there was some form of oral agreement as to these voting rights that was not complied with and therefore the ... [respondents] are not entitled to enforce the deed. I have doubts as to whether or not parol evidence on that question would be admissible, but assuming for the purposes of this case that it is, it still would not in any way derogate from the clear words of the agreement ... .

I think perhaps it is as well to draw back for a moment and just have a look at what is being said here. There is in my view no doubt that there was a clear agreement reduced to writing between the ... [respondents] and the ... [appellant]. The ... [appellant] now does not wish to proceed with that agreement and is attempting to extricate himself from it. In my view there is no basis upon which he can do so. All the agreements are binding and effective and the ... [respondents] are in my view entitled to summary judgment."

18 There are three grounds of appeal. They read as follows:

"(1) The Learned Master erred in fact and in law in deciding the documents signed by the appellant ... on or about 11 January 2002 ... were:

(a) deeds; or

(b) agreements; or

(c) enforceable agreements.

(2) The Learned Master erred in fact and in law in deciding delivery of the said documents to Phillip John Coulsen [sic] was delivery of the documents to the respondents ... .

(3) The Learned Master erred in fact and in law in deciding the respondents ... were ready, willing and able to complete settlement of the sale of the Tuart shares to the appellant ... as required by the terms of the said documents."

19 The principles which govern the grant of summary judgment are settled. They are not in dispute in this appeal. It is enough to say, for present purposes, that the power to order summary judgment must be exercised with great care and only when it is clear that there is no real question to be tried: Fancourt v Mercantile Credits Ltd [1983] HCA 25; (1983) 154 CLR 87 at 99.

21 The contentions advanced by the appellant essentially came down to the proposition that the instruments were never delivered, or were delivered as escrows, subject to a condition which was never fulfilled, with the consequence that the put options never came into effect and the appellant was not bound to purchase the shares.

22 While an instrument which describes itself as a deed may in truth be a mere agreement, the respondents' case, as pleaded and, seemingly, as advanced before the Master, was that the instruments in this case were correctly described as deeds. At common law, there are three, somewhat antiquated, formalities which must be complied with in order for an instrument to amount to a deed. The first is that it must be written on parchment, vellum or paper. The second is that it must be sealed. The third is that it must be delivered: Norton, RF, Treatise on Deeds (2nd ed, 1928, 435) and Monarch Petroleum NL v Citco Australia Petroleum Ltd [1986] WAR 310 at 353. These requirements have been altered, in this State, by s 9 of the Property Law Act 1969 (WA) which provides that:

"(1) Every deed, whether or not affecting property --

(a) shall be signed by the party to be bound thereby; and

(b) shall be attested by at least one witness not being a party to the deed but no particular form of words is required for the attestation.

(2) It is not necessary to seal any deed except in the case of a deed executed by a corporation under its common or official seal.

(3) Formal delivery and indenting are not necessary in any case.

(4) Every instrument expressed or purporting to be an indenture or a deed or an agreement under seal or otherwise purporting to be a document executed under seal and which is executed as required by this section has the same effect as a deed duly executed in accordance with the law in force immediately prior to the coming into operation of this Act."

23 There is no doubt, in this case, that each of the instruments was signed by the appellant as the party to be bound thereby and attested by a witness who was not a party to the deed. As to delivery, Kennedy J, in Monarch Petroleum, expressed the opinion (at 353 - 355) that, because s 9(3) of the Property Law Act is expressed to dispense only with "formal" delivery, it should not be regarded as dispensing with any requirement for delivery. While his Honour found it unnecessary to express a final view on that point (see page 355), it seems to me that he was entirely correct in his opinion. As his Honour pointed out (at 353 - 354), as long ago as 1863, in Xenos v Wickham [1863] EngR 411; (1863) 14 CBNS 435, Martin B said, at 473, of delivery that it -

"is a positive absolute rule of the common law, which nothing but an Act of Parliament can alter, and which in my judgment ought not to be frittered away by judicial decisions, to meet the supposed or alleged hardship of a particular case".

24 While the Property Law Act is, of course, an Act of Parliament, had Parliament intended to do away with this "positive absolute rule of the common law", it might be expected that it would have said so clearly, rather than merely by declaring that "formal" delivery is unnecessary. It consequently seems to me, as it did to Kennedy J, that all that s 9(3) does is to confirm the existing common law rule (which finds expression in such cases as Xenos v Wickham) that no particular form of words or conduct is necessary to amount to delivery, That it does no more than this is, as Kennedy J pointed out in Monarch at 354, reinforced by the reference in the subsection to "indenting", a practice which had been abandoned long before 1969, when the Property Law Act was enacted. Kennedy J also concluded (rightly so, in my respectful opinion) that, in relation to s 9(4), the preferable view was that it (and s 10(1) and s 10(2), applying to corporations) spoke of execution in the narrower sense, so as not to include delivery: page 354; and see also Hooker Industrial Developments Pty Ltd v Trustees of the Christian Brothers [1977] 2 NSWLR 109 at 122.

25 It is enough to meet the requirement of delivery that there be acts or words sufficient to show that the document is intended by the party to be executed as his or her deed, presently binding on him or her: Tupper v Foulkes [1861] EngR 240; (1861) 9 CBNS 797 at 809; [1861] EngR 240; 142 ER 314 at 319; Xenos v Wickham (1867) LR 2 HL 296 at 312, per Blackburn J; Windsor Refrigerator Co Ltd v Branch Nominees Ltd [1961] Ch 88 at 98, per Cross J; and Vincent v Premo Enterprises (Voucher Sales) Ltd [1969] 2 QB 609 at 619, per Lord Denning MR. There is no need for any physical handing over of the deed: Doe d Garnons v Knight [1826] EngR 153; (1826) 5 B & C 671 at 689 - 692; [1826] EngR 153; 108 ER 250 at 257; and Xenos v Wickham (HL) at 323. Whether there has, or has not, been delivery is a question of fact: Xenos v Wickham, at 309, 311 and 319; Ansett Transport Industries (Operations) Pty Ltd v Comptroller of Stamps [1985] VicRp 7; [1985] VR 70 at 78. Intention to deliver may be expressly proved or inferred from circumstances: In re Carile (decd); Dakin v Trustees, Executors and Agency Co Ltd [1920] VicLawRp 86; [1920] VLR 427 at 433. While intention is to be ascertained from circumstances prior to or contemporaneous with delivery, it is permissible to look at later events in order to ascertain what was the intention of the person concerned at the critical time: Poole v Neely [1976] 1 NZLR 529 at 541 and Monarch Petroleum at 356.

26 An intended deed may be delivered as an escrow, to take effect upon the happening of a specified event, or upon condition that the deed is not to take effect until some condition is fulfilled or performed: Xenos v Wickham (HL) at 323; Beesly v Hallwood Estates Ltd [1961] Ch 105 at 117; In re Carile, above, at 431 - 432 and Monarch Petroleum, above, at 356. Whether it is delivered absolutely or in escrow is a question of intention and, as was said by Parke, B, in Bowker v Burdekin [1843] EngR 277; (1843) 11 M & W 128 at 147; [1843] EngR 277; 152 ER 744 at 751:

"you are to look at all the facts attending the execution, - to all that took place at the time, and to the result of the transaction, and therefore, though it is in form an absolute delivery, if it can reasonably be inferred that it was delivered not to take effect as a deed till a certain condition was performed, it will nevertheless operate as an escrow."

27 See also Beesly, at 117; Monarch Petroleum at 356; Federal Commissioner of Taxation v Taylor [1929] HCA 13; (1929) 42 CLR 80 at 87 - 89 and Vincent v Premo Enterprises at 620 and 623.

28 There is nothing in Pym v Campbell [1856] EngR 480; (1856) 6 El & Bl 370 (referred to by the Master) to the effect that the grantor under an intended deed cannot orally declare that the deed is delivered subject to a condition. That case supports the proposition that no addition to or variation from the terms of a written contract can be made by parol (see at 905 per Erle J and per Campbell LJ). However, an oral statement that an intended deed is delivered as an escrow is not an impermissible parol addition to or variation from its terms. It is merely a statement that the intended deed is not to come into effect until a specified condition is fulfilled. It was also said, in Pym v Campbell (by Crompton J at 905), that an instrument under seal cannot be a deed until delivery and, when there is a delivery, that estops the parties to the deed with the consequence that a deed cannot be delivered as an escrow to the other party. Whatever may be the position in that regard in England (see, now, Terrapin International Ltd v Inland Revenue Commissioners [1976] 1 WLR 665 at 670 and the discussion in each of Fisher v Westpac Banking Corporation (1993) 43 FCR 385 at 389 - 391, per French J, and Monarch Petroleum, above, at 356 - 357 per Kennedy J), it seems to be accepted, in Australia, that an intended deed can be delivered as an escrow to a person who, if it ultimately takes effect as a deed, will become a party to it: see In re Carile, at 431 - 432; Federal Commissioner of Taxation v Taylor; and Monarch Petroleum, at 357.

29 The effect of execution of a deed as an escrow was explained by Lord Denning MR, in Kingston v Ambrian Investment Co Ltd [1975] 1 WLR 161 at 166 as follows:

"When a party executes a deed of transfer as an escrow, it means that he executes it subject to a condition, express or implied, which is thereafter to be fulfilled. As soon as the condition is fulfilled the transfer becomes complete. The deed operates to transfer the title to the transferee. If, however, the condition is not fulfilled, the deed is not effective to make the transfer. What, however, is the position during the intervening time between the time when the deed is executed and the time when the condition is fulfilled? The law says that during this intervening time the maker of the deed cannot withdraw it. He cannot recall it or repudiate it. He must await the event to see whether or not the condition is fulfilled."

30 See also Foundling Hospital v Crane [1911] 2 KB 367 at 375, per Vaughan Williams LJ, and 379, per Farwell LJ; and Monarch Petroleum at 357.

31 Counsel for the appellant contended that, if the condition is not fulfilled within a reasonable time, a person who has delivered a document as an escrow may renounce it as, indeed, the appellant purported to do, in his letter dated 29 May 2002, in this case (albeit he used the language of contract, referring to a withdrawal of his "offer").

32 We were referred, in this respect, to the cases of Beesly, Alan Estates Ltd v W G Stores Ltd [1982] Ch 511, Venetian Glass Gallery Ltd v Next Properties Ltd [1989] 2 EGLR 42 and Eljon Pty Ltd v Chief Commissioner of State Revenue [1999] NSWSC 266.

33 In Beesly, at 118, Harman LJ supposed that:

"there must come a time, if there be unreasonable delay in the performance of the condition, when, in these days at any rate where equitable principles govern the actions of the court, the person or firm that has executed the escrow would be released from its obligation."

34 In the same case, at 120, Lord Evershed MR said that he had no doubt that, if performance of the condition was long enough delayed, the party who had delivered the deed might be relieved in equity from any further consequences.

35 In Alan Estates, at 520, Lord Denning MR (who described the doctrine of escrow as a "relic of mediaeval times") said that, if conditions are not fulfilled at all, or not fulfilled within a reasonable time, the maker of the escrow can renounce it and, on his or her doing so, "the transaction fails altogether".

36 What was said by Lord Denning MR in Alan Estates was referred to in Venetian Glass at 45 (where Harman J mentioned that his Lordship had there set out what the law on escrow was) and in Eljon at [34].

37 As to the suggestion that there is, in a case of unreasonable delay, a right to renounce the escrow, there is, so far as I am aware, no other authority to support it than what was said by Lord Denning in Alan Estates and his Lordship there cited no authority in that regard. While his comments were, as I have said, referred to in each of Venetian Glass and in Eljon, in neither of those cases did the question of a right to renounce arise and, in each, the reference to what had been said by Lord Denning was made in a wider context. What was said by each of Harman LJ and Lord Evershed MR in Beesly is, in my opinion, more consistent with the notion that equitable relief is required in a case of that kind.

38 Whatever may be the position in England, it seems that, in Australia, equitable relief is required in a case in which the condition imposed by the grantor has not been fulfilled within a reasonable time and the grantor wishes to be relieved of his or her obligation under the deed. In Federal Commissioner of Taxation v Taylor, Rich, Starke and Dixon JJ said (at 87) that, if a deed was delivered upon the faith of the other parties executing it, then, if they should fail to do so -

"relief in equity is available to the party who executed it upon the faith of the others doing so. (See Carew's case [No 2] [1855] EngR 255; (1885) 7 DeG M & G 43 at 52; Luke v South Kensington Hotel Co (1879) LR 11 Ch D 121 at 125".

39 More recently, in Monarch Petroleum, Kennedy J, after considering a number of the cases, concluded that what emerged from them is that, in the absence of any condition as to time (and counsel for the appellant did not contend that what was said by the appellant in par 27 of his affidavit, quoted earlier in these reasons, amounted to a condition of that kind), the only remedy for delay on the part of non-defaulting parties in assenting to deeds was to seek the aid of equity to have them delivered up for cancellation. His Honour was unable to accept that there was any sufficient basis for the view that the mere lapse of time before the execution of a deed by another party either enabled the party who had delivered the deed to renounce it or prevented the other party from assenting to it (page 361).

40 That said, it is clear that, if a condition imposed by the grantor is not performed, the deed never becomes binding: see Kingston v Ambrian Investment Co Ltd, at 166; Beesly, at 118; and Monarch Petroleum, at 357.

41 That brings me back to this case. It seems to me, firstly, that the Master rightly found, on the evidence as it presently stands, that the requirement of delivery was satisfied.

42 Counsel for the appellant argued in this respect that, because Mr Coulson had never been appointed as the appellant's agent by an instrument under seal, he could not have had the authority to deliver the deeds to the respondents or their solicitors. There is support for the proposition that an agent's authority to deliver a deed must have been conferred by an instrument under seal duly executed by the principal. In Powell v London & Provincial Bank [1893] 2 Ch 555 at 563 Bowen LJ said that "An agent to deliver a deed must be an agent appointed under seal" (see also at 565 - 566, per Kay LJ). In Re Seymour [1913] 1 Ch 475 at 481, Joyce J said:

"There are certain things in the law which are well settled, and, as Lord Lindley said, whether you like it or not, and one is that an authority to an attorney to deliver a deed on behalf of another can only be conferred by an instrument under seal duly executed by the principal. That appears over and over again in the reports and in the case of Powell v London and Provincial Bank."

43 (See also Windsor Refrigerator Co, above, at 98, per Cross J). It is also true that, while that requirement, if correct (see D'Silva v Lister House Development Ltd [1971] Ch 17 and Longman v Viscount Chelsea (1989) 58 P & CR 189 and see also the discussion by Helsham CJ in Hooker Industrial Developments Pty Ltd, above, at 119 - 120), has been abrogated elsewhere (see, in Victoria, s 73B of the Property Law Act 1958 (Vic)), it has not been abrogated in this State. However, on the evidence as it presently stands, Mr Coulson does not appear to have been the appellant's agent for the purpose of effecting delivery of the deeds. Rather, it seems to me that the evidence suggests that he was the agent of the respondents for the purpose of taking delivery of the instruments and there is no suggestion that he required the authority of the appellant for that purpose.

44 That said, it also seems to me that, if it be assumed that the appellant's evidence, as it presently emerges from his affidavit, might be accepted at trial (and that assumption should be made in favour of a defendant, for the purposes of a summary judgment application, where it is a case of word against word and it is not feasible, at that stage, to make any confident assessment of where the truth lies), then it is open to a court to find that the appellant delivered the instruments to Mr Coulson upon the condition that the appellant should not be bound by them until such time as the grantees thereunder had agreed to vote in favour of the resolutions referred to.

45 Counsel for the respondents sought to persuade us that an oral condition of the kind referred to was inconsistent with the terms of each deed (a contention which appears to have held some attraction for the Master). I am not at all persuaded that that is so. I have already said that there is no reason why an intended deed cannot be delivered in escrow upon the strength of an oral condition, at least if it does not contradict any of the written terms of the deed. The only written term which was relied upon in this last respect was cl 5 of each of the deeds which, as I have said, provided that the appellant, as grantor, should "not be entitled to exercise any voting rights until the Settlement date". It was suggested that the oral condition amounted to an exercise of voting rights by the appellant. I am unable to accept that that is so. The appellant was not, by the terms of the oral condition, entitled to exercise any voting rights. Rather, he required each of the grantees to undertake to exercise its own voting rights in a particular way, if that grantee wished to take the benefit of the deed. In any event, it seems to me to be at least arguable that that clause was designed only to cater for the situation in which the deed had taken effect and the option had been exercised, but in which settlement had not yet occurred, and that its purpose was merely that of protecting each grantee's rights until settlement had occurred.

46 Next, there is the question whether the condition (if there was such) was satisfied in each case. Counsel for the respondents sought to persuade us that it was (albeit there was no finding by the Master to this effect). He referred, in this respect, to the evidence of Mr Coulson with respect to the signing of proxies (which appear to have been executed in July 2001, some months prior to the execution of the intended deeds by the appellant on 11 January 2002) and to the delivery of those proxies to Mr Bennett and Mr Fairweather. However, the evidence fell short of establishing that this amounted to satisfaction of a condition (which only came into existence some months later) requiring the respondents to vote in favour of the resolutions to which I have earlier referred, there being no evidence (other than by way of inference) as regards the voting position of either of Mr Bennett or Mr Fairweather. Moreover, the evidence fell short of establishing that any proxy, at all, was given by the first respondent.

47 Counsel for the respondent also pointed to the fact that the resolutions in question had in fact been passed. However, this seems to me not to advance the argument in any way. The condition was not that the resolutions should be passed, but that the respondents should agree to vote in favour of them. There is no evidence to say which, if any, of the respondents in fact voted in favour of the resolutions, whether by proxy or otherwise, and, indeed, the critical resolution appears to have been passed on a show of hands.

48 In all of these circumstances, it seems to me that this was not a case for summary judgment and that the issue of whether there was an oral condition and, if so, whether it was satisfied, should have been left over for trial.

49 I should add, before leaving grounds 1 and 2, that, in my opinion, it is unnecessary to canvass a number of arguments put to us which depended upon ordinary rules relating to offer and acceptance. Those rules have no relevance in the case of a deed: Monarch Petroleum, at 352 - 353. The rationale underpinning the execution of a document as a deed is that the document is to be binding simply by reason of its character, with any action being brought upon the deed itself and not upon the promise.

50 This conclusion makes it unnecessary for me to consider ground 3. However, I will, in any event, deal briefly with it.

51 The appellant contends, under this ground, that there was no evidence that any of the respondents was in a position to complete the sale of the shares when the time came for settlement under each deed and that, on that basis alone, summary judgment should have been refused. It is, of course, well recognised that the readiness and willingness of a plaintiff to perform a contract is at least a factor relevant to the exercise of a discretion whether or not to order specific performance: Fitzgerald v Masters [1956] HCA 53; (1956) 95 CLR 420 at 434; Australian Hardwoods Pty Ltd v Commissioner for Railways [1961] 1 WLR 425 at 432 - 433; and Bahr v Nicolay (No 2) [1988] HCA 16; (1988) 164 CLR 604 at 619. The question of readiness and willingness is one of substance, not to be resolved in any technical or narrow sense: Mehmet v Benson [1965] HCA 18; (1965) 113 CLR 295 at 307; Bahr v Nicolay [No 2] at 619.

52 I have mentioned that in this case each deed required the appellant to pay for the shares in question by bank cheque or cheques payable to the grantee against receipt from the grantee of an executed transfer together with the relevant share certificate or certificates. The only admissible evidence before the Master in this respect was that to which I have earlier referred to the effect that blank transfer forms were provided to the sixth respondent at some time prior to 18 June 2002 and that she, and another solicitor, "were available at the office for the settlement" on 18 June 2002. There is nothing to say that she had, in her possession, all of the executed transfers and necessary share certificates (some of which appear to have been in the name of Nefco Nominees Ltd and Colbern Fiduciary Nominees Pty Ltd, the third and sixth respondents "or nominees" having, as I have mentioned, been said by Mr Coulson to have held shares "under Colbern" and the fourth respondent having been said by him to have held shares "under Nefco"). While it might be inferred from the evidence that the sixth respondent was in a position to settle the transaction on her own behalf and on behalf of each of the other respondents on 18 June 2002, I do not consider that mere inference is enough to justify a remedy so drastic as summary judgment, at least in a case such as this in which the affidavits filed on behalf of the various respondents are deficient in material respects.

53 So, for example, Mr Giuseppe Scaffidi, who swore an affidavit on behalf of the first respondent, said, in par 6 of the affidavit that he (and not the first respondent, of which he is a director) was the holder of 8000 (presumably intended to read 800,000) shares in the company as at December 2001. Mr Eugenio Scaffidi, who filed an affidavit on behalf of the second respondent, said, in par 6 of his affidavit, that he (and not the second respondent, of which he is a director) was the holder of 1,700,000 shares in the company as at December 2001. Mr Maynard Throsby, who filed an affidavit on behalf of the third respondent, said, in par 6 of his affidavit, that he (and not the third respondent, of which he is the sole director) was the holder of 1,000,000 shares in the company as at December 2001. However, Mr Coulson said, in par 6 of his first affidavit, that, as at January 2002, each of the first, second and third respondents was, respectively, the holder of 800,000, 1,700,000 and 1,000,000 shares in the company and, in par 7, that they had been shareholders (presumably of these shares) in the company for many months. No explanation was provided for the

apparent discrepancy, which may or may not have been a product of sloppy drafting. Nor was anything said (otherwise than by inference) about the shareholding of any of the respondents at the time of the proposed settlement.

54 Summary judgment should consequently have been refused on this ground also, in my respectful opinion.

55 For all of these reasons it seems to me that the appeal should be allowed, that the orders of the Master should be set aside and that there should be substituted, in lieu, orders dismissing the application for summary judgment and giving the appellant leave to defend the action. I would hear further from the parties as regards the making of any ancillary orders.

56 MCKECHNIE J: For the reasons given by Steytler J with which I am in entire agreement, I would also allow this appeal.

57 HASLUCK J: I have had the advantage of reading in draft the reasons for judgment of Steytler J. I agree with those reasons and agree that the appeal should be allowed.