Case Study: Contract Law and Property Sale in Tasmania

This case study analyzes a contract law dispute concerning a property sale in Tasmania, involving a purchaser named Mary and a vendor. The central issue revolves around a delay in payment, communication breakdowns, and the potential cancellation of the contract. The analysis explores the importance of proper communication, the validity of a changed settlement date, and the implications of contract cancellation. It examines the legal rights and obligations of both parties, including the vendor's right to issue notices and the purchaser's right to seek remedies like a refund of the deposit or specific performance. The case references relevant legal principles, including the Standard Form Contract for Sale of Real Estate in Tasmania and contract law provisions regarding written agreements and penalty interest. The conclusion suggests that Mary has a strong case due to the lack of proper notice and a written agreement on the changed settlement date, making it difficult for her to lose the deposit. The analysis emphasizes the importance of adhering to contract terms and the potential consequences of non-compliance.

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Question 4
Proper communication is crucial in any contract. Messages and communications need to be done
within time to ensure that the parties plane themselves effectively. The major issue raised in this
case, is defaulting the dates for a contract and lack of proper communication. The authorized
personnel to make the communication between the purchaser and vendor were able to carry their
duty1. Therefore whether they did the communication without consultation with the vendor is an
internal issue which the vendor team has to resolve independently. The main thing to make sure
in this case that there must be an existing written agreement on the postponement of the payment
to the later date of 6th December. If the para-legal issued a written notice that the settlement of
the payment has changed, then Mary can uptake this issue to court and have it settled in her
favour.
If the buyer is unable to obtain the required purchasing to settle the claim, the vendor is usually
under mandate to offer a notice to the buyer on when he or she should be able to settle the
purchase. The vendor may offer a maximum of 14 days to the buyer to rectify the remedy and
settles the said amount. In this case of Mary, what she is receiving is a cancellation of the
contract2. Since Mary had entered into a contract, she requires a notice that the contract will be
terminated and the conditions on the termination. A grace period should be offered in any
contract to ensure that both parties have room to rectify the problem. Under this situation, Mary
is under the period which she should be serving the notice. Therefore cancelation of the contract
and withdrawing it from her will be illegal, since the para-legal may be aware that the duration
1 NSW: Law Society of NSW and REI NSW - Contract for the Sale of Land; Vic: Law Institute
of Victoria and REI Vic - Contract of Sale of Real Estate; ACT: Law Society of the ACT
2 Standard Form Contract for Sale of Real Estate in Tasmania, in the Standard Condition 17.1

up to 6th December was falling under notice. Under this case, the vendor’s conveyancer should
be arguing on the imposition of penalty interest which is about 2% of the agreed amount3. Since
the deposit is about 10%, which is too high from the amount stipulated in the law for the Penalty
interest rate Act. Mary is within her mandate to request for the refund of the deposit if the vendor
is not willing to sell the property to her anymore.
The vendor is only allowed to take the deposit on the expiry of the rescission notice. Under this
case, the vendor has not issued any notice which will mandate him or her to take away the
deposit. Therefore Mary has a strong case to ensure that she either gets the deal through 14 days
after the expiry of the 27th September date, which will fall in the date stipulated by the para-legal
team or get back the deposit. According to Standard Form Contract for Sale of Real Estate in
Tasmania, in the Standard Condition 17.1, 14 days are the clear notice duration should be
provided to the purchaser to settle the agreed amount4. Upon the elapsing of this period is when
the vendor can take action on reposition of the property and keeping the deposit.
Under the failure to honour the contract due day, the law does not provide for the cancellation.
Therefore vendor’s conveyance should be able to seek other means to resolve the dispute in this
case5. The loss of the interest due to the delays should be the clear way out. In this case, Mary
should be willing to compensate the vendor for the lost interest since she is willing to have the
property. The claims on delaying of the payment under this situation do not guarantee and
amount to cancellation of the deal.
3 NSW Society of NSW and REI NSW – Contract for Sale of Land.
4 Courtney, Thomas B., G. Brian Hutchinson, Dáibhí O'Leary, and Thomas B. Courtney. 2012.
The law of companies.
5 Gullifer, Louise, and Stefan Vogenauer. 2017. English and European perspectives on contract
and commercial law: essays in honour of Hugh Beale.

According to contract laws Section 3(3), all property dealings has to be in writing. Therefore
under this case, we can therefore argue that Mary has a writing concerning the change of the
settlement date6. The vendor will have no claim of anything since the team which was doing
much of the paper work had issues the agreement on the change of the date. Therefore, Mary is
within the stipulated guidelines and can still get the property under her name. In conclusion, it is
clear that it will be difficult for Mary to lose the deposit under this situation since the vendor did
not issue any notice to her. Moreover, it is clear that Mary got a written document on the change
of date. This is a clear document that additional information was offered in the contract.
6 McKendrick, Ewan. 2017. Contract Law.
https://nls.ldls.org.uk/welcome.html?ark:/81055/vdc_100044915165.0x000001.

References
Beatson, J., A. S. Burrows, John Cartwright, and William Reynell Anson. Anson's law of
contract. 2016.
Courtney, Thomas B., G. Brian Hutchinson, Dáibhí O'Leary, and Thomas B. Courtney. 2012.
The law of companies
Gullifer, Louise, and Stefan Vogenauer. 2017. English and European perspectives on contract
and commercial law: essays in honour of Hugh Beale.
McKendrick, Ewan. Contract Law. 2017.
https://nls.ldls.org.uk/welcome.html?ark:/81055/vdc_100044915165.0x000001.
NSW Society of NSW and REI NSW – Contract for Sale of Land.
NSW: Law Society of NSW and REI NSW - Contract for the Sale of Land; Vic: Law Institute of
Victoria and REI Vic - Contract of Sale of Real Estate; ACT: Law Society of the ACT
Standard Form Contract for Sale of Real Estate in Tasmania, in the Standard Condition 17.1
Stone, Richard, and James Devenney.. The modern law of contract. 2018.
http://lib.myilibrary.com?id=1016907.