Redevelopments Pty Limited v Enima Pty Limited

[2010] ACTCA 13

ACT Court of Appeal

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For Australian Law.

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Interrogate

Catchwords

1. Contract
2. › Construction
3. › Objective theory of contract — common assumption not reflected in written terms
1. Contract
2. › Implied terms
3. › BP Refinery test — business efficacy — term not necessary where contract effective without it
1. Equity
2. › Rectification
3. › Pre-condition of actual agreement on omitted term — absence of common intention between relevant parties
1. Equity
2. › Estoppel
3. › Promissory estoppel and estoppel by convention — elements not established against nominee purchaser

Quick Take

The ACT Court of Appeal held that a common assumption shared between the original parties to an option deed (that a development application would be lodged before exercise) could not support the implication of a contractual term, rectification, or estoppel against a nominee purchaser who was not party to the original negotiations. The contract's express provisions satisfactorily accommodated the scenario where no development application was made, yielding an $8 million purchase price rather than $10 million, and the entire agreement clause reinforced that the written terms governed. The Court left open whether clause 38.4 of the contract might entitle the vendor to a future price adjustment if the purchaser later made a change of use application.