Background
Margaret Koh, acting as a self-represented solicitor, negotiated to purchase a property at River Avenue in Chatswood from Arthur Chhoeu for approximately $3.2 million. After extensive negotiations on 14 June 2024, Margaret provided a signed section 66W certificate (which waives cooling-off rights under NSW law) and the parties executed counterpart contracts. The signed counterparts were exchanged on 17 June 2024, but they were not identical: one counterpart omitted clause 46 while the other omitted page 3. Margaret subsequently claimed no binding contract had been formed due to the non-identical counterparts, argued she had not waived her cooling-off rights, and purported to rescind the contract on 24 June 2024.
Arthur contended that a binding contract was formed on 16 June 2024, that Margaret had effectively waived her cooling-off rights by providing the section 66W certificate, and that he was ready, willing and able to complete the sale. He sought damages for Margaret’s failure to complete, calculated as either liquidated damages under the contract or loss on resale. Justice Pike heard the matter over three days in September 2025.
The Court’s Holding
The court upheld Arthur’s contentions in full. Justice Pike found that despite the non-identical counterparts, a binding contract was formed on 16 June 2024 because the parties were in agreement on all essential terms. The court rejected Margaret’s argument that technical defects in the counterparts prevented contract formation, holding that the parties’ intentions and mutual agreement on material terms were conclusive.
On the cooling-off rights issue, the court found that Margaret had intentionally left the signed section 66W certificate with the real estate agents on 14 June 2024 with the express understanding that it would be used if final agreement was reached. This constituted an effective waiver of cooling-off rights under section 66W of the Conveyancing Act 1919 (NSW). Even assuming Margaret had not waived those rights, the court found her purported rescission on 24 June 2024 was ineffective because it occurred outside the mandatory 5 business day cooling-off period. Finally, the court found Arthur was ready, willing and able to complete the sale when he terminated the contract.
Accordingly, the court declared that Arthur validly entered into a binding contract for the sale of the property and that Margaret is liable for damages resulting from her breach.
Key Takeaways
- Non-identical counterparts do not prevent contract formation if the parties are demonstrably ad idem on all essential terms
- A section 66W certificate, once executed and provided by a purchaser prior to auction, operates as an effective waiver of statutory cooling-off rights in pre-auction sales
- Rescission of a land sale contract must occur within the strict statutory cooling-off period; rescission outside this window is ineffective
- Courts will prefer contemporaneous objective documents and inherent probabilities over uncorroborated oral testimony when assessing conflicting factual accounts in contract formation disputes
- A vendor’s readiness, willingness and ability to complete performance is a material element in establishing the purchaser’s liability for damages upon breach
Why It Matters
This decision provides critical guidance for NSW legal practitioners on contract formation in real estate transactions. It confirms that formal regularity in counterparts, while desirable, is not determinative where the parties’ manifest intention to be bound is clear and they have reached consensus on essential terms. The judgment also clarifies the interaction between section 66W certificates and statutory cooling-off rights, establishing that such certificates constitute binding waivers when accepted by the vendor or their agents as part of the exchange process.
Most significantly for practitioners advising purchasers, the case underscores the serious consequences of non-performance: a purchaser who breaches a binding land sale contract faces substantial damages liability (measured as loss of bargain or loss on resale) and cannot escape that liability through technical objections to contract formation or belated assertions of cooling-off rights where such rights were effectively waived. The strict statutory framework governing cooling-off periods in pre-auction sales is enforced with rigor, and attempted rescission outside the prescribed window will fail regardless of the circumstances.