This case involved the sale of a block of 6 units (all on a single title) at Lakemba NSW by the Santangelo family to Yates Holdings Victoria Pty Ltd.  The vendors sought orders for specific performance, based on the purchaser’s failure to complete on various dates.  The purchaser, in turn, argued that the vendors were not ready, willing and able to complete, arguing that the vendors failed adequately to answer the purchaser’s requisitions and the vendors had not done all things necessary under the contract to transfer the benefit of certain tenancies to the purchaser at or before completion.

The contract for sale was exchanged in July 2021, with a 120 day settlement period (8 November 2021), and subject to existing tenancies – each of the units was already leased.  In addition to the standard contractual clauses, the contract also contained special conditions typically included in contracts such as this, such as the right to serve a notice to complete within 14 days if completion does not take place on the contractual completion date.

The purchaser failed to complete the contract on the following dates 8 November 2021, 10 November 2021, 30 November 2021 (the date appointed after the vendors’ issue of a Notice to Complete).

The parties were in dispute pertaining to a reduction in the purchase price of the property and the transfer of the rental bonds.  On the date of settlement the vendors claimed they were ready, willing and able to settle the matter, the purchasers lawyer was asked to urgently sign off in the PEXA workspace in order for settlement to proceed.  The purchaser’s lawyer failed to do so.  the vendor’s lawyer was asked to explain the reason for the delay. The purchaser’s lawyer argued that the vendor’s had breached the clause in the contract regarding a right of the purchaser to access the property and requested that access be granted.  The vendor’s lawyer contested the claim for access to the property, noting that if the purchase had completed on time, the purchaser would already have had access.

The purchaser failed to complete the matter on the due date of the contract (2 days after the original contractual date), the vendor issued a Notice to Complete

The purchaser’s lawyer’s resisted the issuing of a Notice to Complete arguing the vendors were not in a position to issue such notice because they were not ready, willing and able to complete themselves because of the “subsisting breaches” (of not providing access, and because of an allegedly illegible owners’ consent form.

The vendor commenced proceedings in the Supreme Court on 6 December 2021 for specific performance of the contract.

The Issues

Was the vendor entitled to issue a Notice to Complete even though it failed to provide a satisfactory reply to a requisition on title.

Replies to requisitions on title – adequacy of replies to certain requisitions including the requisition regarding adverse possession.

it does not follow that if a purchaser does not consider a vendor’s to a requisition to be that the vendor cannot issue a notice to complete; the purchaser should have  required  the vendor to answer requisitions correctly within a defined but proper time

The court considered that the vendor’s reply to the requisition relating to adverse possession had been answered correctly. The court rejected the purchaser’s argument.

Matters relating to the existing tenancies

Failure by the vendors to provide a Notice of Attornment addressed to the tenants regarding the change in ownership. The vendors argued that the contract did not require these to be provided on completion but instead to be provided to the purchaser at completion.  The Court noted that the contract contemplated that those matters were to be attended to as part of completion, with the contractual rights in this respect continuing after completion for a reasonable time”- and would take priority over any apparent inconsistent requisition.

Specific performance

The court held that the purchaser had breached the contract and granted a decree of specific performance.