Delaney v Delaney

[2022] VSCA 48

Victorian Court of Appeal

Built by Barristers,
For Australian Law.

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Interrogate

Catchwords

1. Contract
2. › Formation
3. › Completeness of agreement
4. › Heads of agreement
5. › Distinction between essential terms and important but inessential terms
6. › Whether omission of important but inessential terms renders agreement incomplete
7. › Whether parties intended to be bound
8. › Masters v Cameron categories
1. Contract
2. › Formation
3. › Intention to be bound
4. › Objective ascertainment of intention
5. › Relevance of express clause stating intention to be legally bound
6. › Relevance of provision for further agreement with fallback clause
1. Equity
2. › Specific performance
3. › Contract of sale
4. › Interest on purchase price
5. › Whether vendor entitled to interest where vendor responsible for delay in completion

Quick Take

When assessing whether a heads of agreement constitutes a binding purchase agreement, two distinct inquiries must be kept separate: (1) whether the essential terms are present, and (2) whether the parties intended to be bound despite the absence of important but inessential terms. The omission of important but inessential terms (such as tax structure, loan treatment, and price apportionment) does not render an agreement incomplete in the first sense; it is relevant only to the second inquiry as to intention. Express clauses stating intention to be bound, combined with fallback provisions stipulating that the heads of agreement will 'prevail' absent further agreement, are very strong indications of intention to be bound that will be difficult to displace.