Broughton v B & B Group Investments Pty Ltd

[2017] VSCA 227

Victorian Court of Appeal

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For Australian Law.

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Interrogate

Catchwords

1. Contract
2. › Construction of contract
3. › Sale of business
4. › Special condition entitling purchaser to terminate after due diligence
5. › Whether condition required causal link between information obtained during due diligence and decision to terminate
6. › Text, context and purpose of contractual provisions
1. Contract
2. › Sale of business
3. › Termination by purchaser
4. › Measure of damages
5. › Whether time for assessment of damages is date of breach, date of abandonment of specific performance application, or date of trial
6. › Absence of evidence of value of business
7. › Onus on innocent party to establish departure from date-of-breach rule
1. Appeal
2. › Appeal from findings of fact
3. › Whether judge's findings influenced by assessment of credit should be disturbed
4. › Uncontested testimony demonstrating error
5. › Robinson Helicopter Co Inc v McDermott [2016] HCA 22 applied
1. Evidence
2. › Rule in Browne v Dunn
3. › Important allegation not put to witness at trial
4. › Effect on weight of unchallenged evidence

Quick Take

A due diligence termination clause requiring the purchaser to have 'conducted the due diligence' before terminating imposes a causal link between the due diligence and the termination decision, but does not require the due diligence findings to be new information or the sole or dominant reason for termination — it suffices that information gained during due diligence formed part of the decision. A vendor claiming damages for breach of a sale of business contract assessed at a date later than the date of breach must adduce evidence justifying the departure and establishing the value of the business at the alternative date; asking prices and offers made in distressed circumstances are insufficient.