Ryan v Fergerson [1909] HCA 47; (1909) 8 CLR 731 (9 August 1909)

HIGH COURT OF AUSTRALIA

Ryan Plaintiff, Appellant; and Fergerson Defendant, Respondent.

H C of A

On appeal from the Supreme Court of New South Wales.

9 August 1909

Griffith C.J., O'Connor and Isaacs JJ.

S. A. Thompson, for the appellant.

W. J. E. Davies, for the respondent,

August 9

Griffith C.J.

This is an appeal from an order of the learned Chief Judge in Equity dismissing a summons purporting to be taken out under the provisions of the vendor and purchaser provisions of the Equity Act 1901. I entertain very grave doubt whether the Equity Court had jurisdiction to entertain the application under the circumstances. The plaintiff agreed to buy from the defendant a piece of land through the medium of an agent. The contract was partly in print and partly in writing. The terms of sale were that the purchase money should be £475, of which £75 was to be paid in cash and the balance at the end of three years, with the option of paying it off at an earlier period, the purchaser in the meantime paying interest at the rate of 5 per cent. on the unpaid purchase money. One of the printed conditions of the contract was that the purchaser should within seven days from receipt of the particulars of the vendors' title, at his own expense tender to the vendor or his solicitor, for execution, a memorandum of transfer in conformity with the provisions of the Real Property Act.

It is gravely argued that under that condition the purchaser is entitled at once, without payment of any more of the purchase money than the amount of the deposit, to a conveyance of the property free of encumbrances, leaving as the only protection to the vendor, when the transfer is registered, any right he may have to lodge a caveat against the purchaser's dealing with the land before payment of the balance of the purchase money. So far as the summons can be regarded as an application to the Court to have this declared to be the true construction of the contract, it is probably within the jurisdiction of the Equity Court to entertain it. And such a construction is gravely argued. In my opinion it is incapable of serious argument, when the conditions are considered. It is true that one condition is that the purchaser is to tender a memorandum of transfer within seven days. But it is quite clear that it was never the intention of the parties to a contract of this sort that the purchaser should get a clear title until he had paid the full purchase money. The rule applicable to such cases was laid down by Lord Ellenborough C.J. in Robertson v. French[1], in a passage cited by Lord Halsbury L.C. in Glynn v. Margetson & Co.[2]. That was an action on a policy of insurance, in which, as his Lordship pointed out, the greater part of the printed language was invariable and uniform and had acquired a known and definite meaning. With respect to policies of this sort which are commonly in print with a certain portion in writing, Lord Halsbury said:—"The words superadded in writing (subject indeed always to be governed in point of construction by the language and terms with which they are accompanied), are entitled nevertheless, if there should be any reasonable doubt upon the sense and meaning of the whole, to have a greater effect attributed to them than the printed words, inasmuch as the written words are the immediate language and terms selected by the parties themselves for the expression of their meaning, and the printed words are a general formula adapted equally to their case and that of all other contracting parties upon similar occasions and subjects." I think that it is impossible to contend that under this contract the purchaser is entitled to a transfer until he has paid the whole of the purchase money. The appellant therefore must fail in so far as the summons rests upon that contention, for it asks in substance for a declaration that the purchaser is entitled to an immediate transfer. Then the case is put by the appellant in another way. It turns out that the land is subject to a mortgage for £225, and the purchaser says that he is entitled to a conveyance of the land freed from that encumbrance, or at any rate to enjoy the possession of it free from the risk of any interruption by the mortgagee. For it is only by the mortgagee that he could be put out. He is clearly entitled, when he has paid the purchase money, to get a clear title, and no doubt if he pays it he will get such a title, for the mortgage debt may be paid at any time. The only point then is that he is exposed to the risk of ejectment or something of that nature during the three years. Now it appears in evidence that the mortgagee was aware of and consented to the sale, so that that risk does not exist in fact. If it did, the only consequence would be that the purchaser might be entitled at common law to rescind the contract upon the ground that he had been induced to enter into it by the concealment of a material fact, and upon no other ground. But that point cannot be raised on a vendor and purchaser summons. The proceeding was in my opinion entirely erroneous, and the learned Judge had no course open to him but to dismiss the summons.

O'Connor J.

I am entirely of the same opinion. I do not see how the learned Judge of the Court below could have come to any other conclusion than that at which he has arrived. I do not think it necessary to add anything to what my learned brother the Chief Justice has said.

Isaacs J.

I agree that this appeal should be dismissed. The provision for payment of purchase money required the purchaser to pay a cash deposit of £75, and the balance at the end of three years, with interest in the meantime at the rate of 5 per cent. payable quarterly, and with the option of paying off the whole at any earlier period. That portion of the contract is in writing, and, in accordance with the rule stated by my learned brother the Chief Justice, and followed time after time in the Courts both in England and America, that must have greater weight than any printed provision inconsistent with it. Well, the reasonable and ordinary implication from such a provision is that the conveyance is to be concurrent with the payment in full of the purchase money. The appellant relies upon the first clause of the printed conditions, and he says that that entitles him to a conveyance of the property, notwithstanding the ordinary and legal presumption referred to, and notwithstanding that no portion of the purchase money has been paid except the deposit of £75. That clause provides that the purchaser shall, not may, but shall, within 7 days after the receipt of particulars of title, at his own expense, tender for execution a transfer in conformity with the Real Property Act, and from the completion of the purchase the purchaser shall be entitled to the rents and profits. There is no express provision in that that the vendor shall immediately execute and hand over to the purchaser this transfer duly executed and permit him to take it away and register it, notwithstanding the non-payment of the purchase money, and it does not in its terms profess to give the purchaser any benefit at all except the right to the rents and profits of the land after completion of the purchase, whatever that means. But it puts an obligation upon the purchaser. It limits him as to his freedom of action. He must, within 7 days after receipt of particulars of title, tender for execution a memorandum of transfer. If he is going to accept the title he must accept it in that way. He has to tender a memorandum of transfer in proper form for execution. If he makes any objection or requisition under the fourth condition, then the vendor is to be at liberty to rescind the contract if unable or unwilling to comply with the requisition. But if he accepts the title then it seems to me that, reading that condition with the provision for payment of the purchase money, it means reasonably construed, that he is then, i.e., when the title is accepted by the purchaser, entitled to the rents and profits. Further if, having accepted the title, he pays the purchase money, he is entitled to have the property handed to him free of encumbrance on his tendering a transfer ready for execution. No time is fixed for the execution, and none for delivery up to the purchaser, and therefore there is nothing, in my opinion, to displace the reasonable presumption arising from a consideration of the terms of the provision as to payment of the purchase money, namely, that the two are to be coincident. That is sufficient to dispose of the matter. But there is another question and that is, that the time has not arrived for the purchaser to complain. He is entitled to have his transfer immediately on its being tendered for execution, and if that is done he gets the right to everything else. But if not, he fails. Upon these grounds I think that the appeal should be dismissed.

Appeal dismissed, with costs.

Solicitors, for the appellant, Vindin & Littlejohn.

Solicitor, for the respondent, A. B. Davies.

[1] 4 East., 130, at p. 136.

[2] (1893) A.C., 351, at p. 358.