Confirms that a vendor who exercises a contractual power of resale upon the purchaser's default provides a complete answer to claims for both specific performance and damages, even where the vendor has previously obtained judgment for the purchase money.
Waldon Plaintiff, Appellant; and The Rostrevor Estate Limited (In Liquidation) and Others Defendants, Respondents.
H C of A
On appeal from the Supreme Court of South Australia.
23 September 1926
Knox C.J., Isaacs and Starke JJ.
Kerr (with him Sutherland), for the appellant.
Cleland K.C. and Hicks, for the respondent company, and Treloar, for the respondent Mrs. Nicholls, were not called upon.
Knox C.J.
In my opinion this appeal should be dismissed. I have nothing to add to the reasons given by Napier J.
Isaacs J.
I agree that the appeal should be dismissed. Apart from the special provisions of clause 12 of the one set of conditions and clause 9 of the other, I should feel considerable difficulty, in view of what has taken place, in entirely absolving the respondent company. Apart from those special provisions the governing circumstances are these:—The company sued for the whole of the balance of the purchase-money and recovered judgment for the amount with interest and land tax. That was a distinct affirmance of the contract, and, so far as its effect went, was specifically insisting on the performance of the contract. That judgment is still in existence and operative. But clause 12 and clause 9, which I think are substantially identical in this respect, appear to me to constitute a special provision for self-protection on the part of the company against loss arising from non-performance of the contract by the original purchaser. That special contractual provision is to the effect that if the company cannot get the money contracted to be paid by the original purchaser from him, then, without prejudice to any other remedy which might otherwise have been open to it, the company may resell the land and endeavour to get the money from someone else. If the company is successful in that attempt and actually receives the purchase-money, the original purchaser has nothing more to pay. If the company is not successful in obtaining the amount originally agreed to be paid, the original purchaser is liable for the deficiency, and, if the company obtains more than the amount of the original purchase-money, the company is entitled to keep the surplus. That being so, the appellant having failed to perform his original contractual obligation to pay the purchase price, thereupon the condition came into existence upon which the company could exercise its power of self-protection, and the company did exercise that power. The inevitable result of exercising the power is that the appellant could not have the land. That entirely affords an answer to his claim for specific performance. And, since it was under his authority that this course was taken, his claim for damages must fail. Upon the merits and applying the case of Economic Life Assurance Society v. Usborne[1], those two clauses afford a complete answer to the appellant's claim, even if he be at liberty now to press for common law damages.
Starke J.
I agree that the resale by the company was justified by clauses 9 and 12 of the conditions.
Appeal dismissed with costs.
Solicitor for the appellant, A. J. L. Sutherland.
Solicitors for the respondents, Robert Homburg; J. L. S. Treloar.
[1] (1902) A.C. 147.