Court of Appeal

JLF Corporation Pty Ltd v Matos [2016] QCA 355 (16/3338) Fraser and Gotterson and Philip McMurdo JJA 23 December 2016

Full-text: QCA16-355.pdf

Catchwords

CONVEYANCYING – OPTIONS – where the respondent purchased property from the appellant – where the respondent and the appellant entered into a Put Option Agreement whereby the appellant agreed to purchase back the property if the respondent sent a contract contained in a schedule prior to a certain date – where the respondent sought to exercise the put option – where the respondent used the tenth edition of the REIQ/Queensland Law Society standard form contract in lieu of the eighth edition of the contract attached to the Put Option Agreement – where the primary judge held that the respondent validly exercised the put option contained in a written Put Option Agreement between the respondent and the appellant dated February 2012 – where the appellant argued that the exercise of the put option was invalidated by the delivery of the tenth edition of the standard form contract rather than the edition contained within the Put Option Agreement – where the respondent submitted that the primary judge’s conclusions were correct – whether upon the proper construction of the Put Option Agreement, it required, for the valid exercise of the put option, that the respondent deliver a contract in the form of the eighth edition of the REIQ/Queensland Law Society standard form

Summary Notes

General Civil Appeal – where the respondent purchased property from the appellant – where the respondent and the appellant entered into a Put Option Agreement whereby the appellant agreed to purchase back the property if the respondent sent a contract contained in a schedule prior to a certain date – where the respondent sought to exercise the put option – where the respondent used the tenth edition of the REIQ/Queensland Law Society standard form contract in lieu of the eighth edition of the contract attached to the Put Option Agreement – where the primary judge held that the respondent validly exercised the put option contained in a written Put Option Agreement between the respondent and the appellant dated February 2012 – where the appellant argued that the exercise of the put option was invalidated by the delivery of the tenth edition of the standard form contract rather than the edition contained within the Put Option Agreement – where the respondent submitted that the primary judge’s conclusions were correct – whether upon the proper construction of the Put Option Agreement, it required, for the valid exercise of the put option, that the respondent deliver a contract in the form of the eighth edition of the REIQ/Queensland Law Society standard form – where the resolution of the appeal turns upon the proper construction of the Put Option Agreement – where an objective approach must be adopted in that exercise; the meaning of that agreement must be determined by what a reasonable business person would have understood it to mean, and that requires consideration of the language of the agreement, the surrounding circumstances known to the parties, and the commercial purpose or objects to be secured by the agreement: Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 – where there is no relevant ambiguity about the meaning of the relevant clause – where the only way in which the put option could be exercised, if the respondent chose to exercise it, was “by the Owner delivering to JFL two (2) copies of the Contract…”, and otherwise as prescribed in cl 2.4 – where the primary judge noted that cl 2.4 did not itself contain express terms requiring an executed contract in the form of the eighth edition of the standard form contract, but that was conveyed with at least equal clarity by the inclusion in Schedule 1 of a form of contract with several identifications in it that it was the eighth edition of the standard form contract – where the clear language of cl 2.4 of the Put Option Agreement made the delivery to the appellant of two copies of the eighth edition of the REIQ/Queensland Law Society standard form of contact for houses and residential land, duly signed by the respondent, an essential requirement for the exercise of the put option – where the respondent’s delivery of signed copies of the tenth edition of that standard form contract did not comply with that essential requirement, with the result that the put option was not exercised. Appeal allowed. Set aside the declarations and orders made in the Trial Division. Dismiss the originating application. Costs.