* Estate agent retained by Cameron drew up a sale note for the sale of Cameron’s property to Masters. * Cameron’s insistence included in the sale note a clause. * Agreement made subject to the preparation of a formal contract of sale, which shall be acceptable to solicitors on the above terms and conditions. * Both parties signed the sale note.
* Masters paid a deposit.
* Masters did not signed the contract prepared by Cameron’s solicitors as Master experienced difficulties arranging necessary finance and wished to withdraw the purchase. * Cameron wished to proceed the sale.
* The court have to decide whether the parties were contractually bound by the sale note(which has been signed by both of them) or whether they would only have formed a binding contract by Cameron’s solicitors(which could not apply, since Masters did not signed.
* Souter v Shyamba Pty Ltd (2003)
* Shyamba owned land at Merimbula, NSW on which it operated a hotel and motel. * 8 October 2001, Souter wrote to Shyamba enquiring whether the property was for sale and one Bennett, a director of Shyamba, telephoned Souter and told him that the price was $3 million. * Negotiations at lower figures failed.
* Fresh negotiations in March and April 2002 resulted a signed document by Souter and by Bennett and one Mirabito on behalf of Shyamba. * The document provided that “This sale will become unconditional upon the purchaser paying the amount of $1,000 into the vendor’s bank account. The purchaser agrees to pay a further $299,000 to the vendor’s solicitor upon exchange of contracts, not later than 16 June 2002 and the balance ($2,700,00) at settlement 1 July 2002. * On 1 May 2002, Souter paid $1,000 unto the vendor’s bank account and Shyamba instructed its solicitors to prepare formal agreements. * On 31 May 2002, Bennett wrote to Souter, stating that the sale had “hit a hurdle in the form of a huge Gazzumpt”. *...