Laundy Hotels (Quarry) Pty Limited v. Dyco Hotels Pty Limited atf The Parras Family Trust & Ors

Lower Court Judgment

21/12/2021 Supreme Court of New South Wales (Court of Appeal) (Bathurst CJ, Basten & Brereton JJA)

[2021] NSWCA 332

Catchwords

Contracts – Construction – Interpretation – Termination – Frustration – Supervening illegality – Covid-19 – Public Health Order – Where settlement of goodwill, plant and equipment under contract for sale of hotel and associated business agreed to take place on 30 March 2020 – Where cl 50.1 of contract required vendor to carry on business in usual and ordinary course as regards its nature, scope and manner and repair and maintain assets in same manner as at date of contract and use reasonable endeavours to ensure all items on inventory in good repair and in proper working order – Where Public Health (Covid-19 Places of Social Gathering) Order 2020 (NSW), made pursuant to Public Health Act 2010 (NSW), came into effect on 23 March 2020 and prohibited opening of pubs except for sale of food and beverages to be consumed off premises – Where purchasers asserted contract had been frustrated – Whether supervening illegality pursuant to Public Health Order suspended parties' obligations to seek completion of contract – Whether Public Health Order amounted to doctrine of temporary suspension of obligations inconsistent with approach to resolving questions of supervening illegality