The commentary in the By Lawyers Conveyancing NSW Guide and 1001 Conveyancing Answers (NSW) has been updated to highlight some important considerations brought to light in the recent decision on the NSW Court of Appeal in Namrood v Ebadeh-Ahvazi [2017] NSWCA 310, namely the importance of issuing a Notice to Complete before purporting to terminate and the distinction between the completion date and the actual date of completion.

The ‘completion date’ is specified in the contract, but because time is not of the essence and settlements are often delayed, the actual completion date can be a later date. Any provision in a contract providing that something must be done on or by completion is not necessarily a requirement that it be done on or before the completion date

The facts in this case were that the contract of sale provided for work to be done on or by completion. When the completion date passed a notice of termination was served by the purchaser without first serving a notice to complete making the completion date of the essence. The work was subsequently finished and as no essential completion date had been established by a notice to complete, the purported termination by the purchaser failed, was deemed a repudiation of the contract and the deposit paid was forfeited to the vendor. The fact that a time and date for settlement is agreed does not of itself make time of the essence and justify termination.  Either the essentiality of time must be agreed at the outset, or it must be made essential by serving a notice to complete.

This case also highlights the potential issues that arise with inserting special conditions regarding compliance with works notices, which necessarily override s 11 of the Law Society Contract by virtue of the definition of ‘normally’ therein.

The commentaries in the By Lawyers Conveyancing Guides – Acting for the Purchaser and Acting for the Vendor, as well as the relevant sections of 1001 Conveyancing Answers NSW, have been updated accordingly.