Goldmaster Homes P/L & Anor v Johnson & Ors

[2004] NSWCA 144

NSW Court of Appeal

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Interrogate

Catchwords

1. Contract
2. › Formation
3. › Offer and acceptance
4. › Whether concluded contract established on evidence
5. › Three discrete arrangements in telephone conversation
6. › Whether arrangements interrelated or formed one bargain
7. › Whether consideration supported alleged promise
1. Contract
2. › Construction
3. › Right of first refusal
4. › Nature and content of obligation
5. › Whether 'first refusal' is a technical term or colloquial expression
6. › Distinction between option and right of pre-emption
7. › Whether formal written offer required to discharge obligation
8. › Whether American authorities should be followed in Australia
1. Contract
2. › Performance and breach
3. › Right of first refusal
4. › Whether obligation discharged by providing price list and opportunity to purchase
5. › Whether definitive refusal by promisee discharged obligation

Quick Take

In Australian law, 'right of first refusal' is not a technical term with an established legal meaning but a colloquial expression of flexible import, and its meaning must be determined from the whole of what the parties have said and the surrounding circumstances, following Woodroffe v Box. American authorities treating it as a term of art should not be followed. A right of first refusal may be sufficiently discharged by providing the promisee with genuine prices and an opportunity to purchase, without the need for a formal written offer containing all terms of a proposed sale to a third party. Informal references to a 'right of first refusal' without elaboration of the mechanism for its exercise may be insufficient to create a binding contractual obligation.