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ARTICLE · 10 NOVEMBER 2017

Residential Focus - 8 November 2017: Part 1 - Contract void for illegality?

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The Court held that the contract for the sale of land was able to be performed lawfully, so it was not unenforceable.

AustraliaReal Estate and Construction
Eleanor Grounds
Eleanor Grounds
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On 23 October 2017 the New South Wales Court of Appeal handed down its decision in REW08 Projects Pty Ltd v PNC Lifestyle Investments Pty Ltd [2017] NSWCA 269. The case concerned a contract for the sale of land which the appellant argued was void for illegality.

Facts

The appellant entered into a contract to sell a lot in a subdivision at Schofields in western Sydney to the respondent. The contract stipulated the purchase price was $485,000, with a deposit of $250,000 to be paid. Two special conditions in the contract provided:

  1. that the appellant vendor had a right to rescind the contract and simultaneously enter into a new contract on identical terms; and
  2. for a price reduction of $235,000 (being the balance of the purchase price) to be made at settlement provided that the purchaser respondent met all obligations under the contract by that time.

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